The progressive farmer. [volume] (Winston, N.C.) 1886-1904, 1891-11-24
Az ABLE DEFENDER.
Governor Pennoyer Favors Government
Loans TO the People.
The PrincipleW the Sub Treasury Bin
Sustained IN q Strong Article By
the Governor Of OregOn-Im-
prorcd Land tie Safest
Of Securities.

Governor Sylvester PennOycr, Of
Oregon, contributes an interesting and
able argument in the last number Of
The North American IeUier in defense
Of the Alliance principle Of government
loans II the people. The article l.
worthy Of general peTu=al and discus
sion. Some Of his best points are con
tainei IN the following extracts:
The mutterings q discomfort. al
though heretofore diEre gaTd@d. have
been universal. They could find 70
expression in the platform Of any ~El-t-
ing political party, and therefore L4v"
been cOltcmncd a. we'll as Uuh@@Je3.
These m~uttcrings have AT length found
voice In q new political org suIzatiOn.
and their long pent up expression ~lll
undoubtedly be the great slogan Of the
coming presidential contest Hence Il
Is Of the most vital concern To the
party itself. as well as u the people
whose interests it would s~ubScrve. that
its financial policy should be u that
can be defended upon thu grounds Of
justice, Of public necessity and Of Dusi-
ness principles. If such Il policy can
be formulated the young STRIPPING Of a
party VIII win to its following the
honest hearted yeomanry Of the whole
country, and may achieve a pDlltlcai
victory ~unrivaled in this country for
more than half a century past.
In the first place. therefore. the cur
rency which is proposed TO be issued
should be based upon perfectly secure
and im~parishabla foundation. and
should be a legal tender for all debts,
public and private. Such a basis can
only he furnished by the real property
Of the country. To accept personal
security, or any other security than
the improved real property Of the
country, would be to hazard the loan,
which the government, in the interest
OF the whole people, poor aS welt a.
rich. cannot justly do. There can be
NJ better or safer security for a govern
ment loan than the real property Of
the nation. If the loan is placed upon
such property at n Ia f or one third
Of It's real value. It IS rs cur as the
government itself, and the currency
based upon such a loan Is as good a.
a government bond OF gold and silver.
The main argument against such =
policy IS based upon its supposed i'm
practicabilitv. This has been answered.
by stubborn facts. The State Of Ore
gOH has nOw % than two million
dollars Of school money loaned upon
the improved farm property Of the
Stat. The amount Of the loan Is fixed
at one third of the fairly appraised
value Of the farm. The entire manage
meut Of the loan IS COnfded 10 the
State school land board. c assisting Of
the Governor, Secretary Of State and
State Treasurer. and Is without any
cost 10 the State other than thai in
involved in the salaries paid to the
members Of the board for their entire
official duties. amounting IN all to
s., so per annun. The applicant pays
for the examination Of the title to his
land and its appraisement by the at
tOrney Of the board for the county IN
which the land is situated.
The machinery IS perfect and com
paratively inexpensive, and the seCur-
ity the best in the wO Ii. The loans
for the whole State are made by the
State Board at the capital, and the
distribution Of funds throughout the
State is fairly made. This system has
been a blessing to Oregon farmers, and
it may be a blessing to the farmers Of
the whole country by demonstrating
the entire feasibility Of l~oaning govern
ment money upon the improved real
property Of the country.
The next question Of Importance
SSO1FCA ny VIC pIOpOcCA 1III1IlCILI ~ >
tenn Is: How shall the money be pro
cured by the government for making
such a loan, If required. it could and
would be procured as it was in order
tOcarry onthe late war. but theamOunt
to be provided would to a great extent
depend upon the exact conditions of
the fiscal policy to be established.
IF the loans were made to the people
upon improved real property at a rate
not exceeding 4 per cent, and the cur
rency for such loans, as well as gold
and silver, was changeable at will into
government treasury notes or bonds
bearing interest not exceeding 3 per
cent, the result would undoubtedly be
that the issuance Of not nearly so
much currency would be required as
would be if no such provision for fund
ing it was made, inasmuch as investors
in government securities would largely
furnish the required amount.
If a policy be adopted of changing
the currency into bonds and the bonds
into currency, at the will Of the holder
of either, under the necessary restric-
tiOns, the whole financial business of
the country could be adjusted to the
proposed system without any greater
enlargement Of the volume Of the cur
rency of the country than its actual
business requirements demand. Such
a policy would place the currency of
the nation upon the safest foundation
possible, and would entirely preclude
those extremes Of contraction and ex-
pansiOn so hurtful to business interests;
for if there should be in circulation
more money than could be advantage
Ously used it would seek investment in
COVER ment securities. while, if there
should be an urgent need for more, the
bonds would be changed into currency.
The loaning Of money by the govern
ment at 4 per cent. would at once fix
that rate throughout the country with