The representative. [volume] (St. Paul, Minn.) 1893-1901, 1894-07-04
MUNICIPAL MONEY.
Approved by Honest and Thoughtful
Men.

Approved by Honest and Thoughtful
ST. PAUL Mimi, June 29-Your issue Of
June u contained letter from the pen of
Mr.. R. P. Hoskyn in which that gentle
man ably presented his views commenda-
tory Of what he calls the Municipal Bond
Plan" I am exceedingly pleased to note
that this plan meets the approval Of honest
and thoughtful men. No matter when or
where 1t was originated it is based upon
that principle expressed in the motto
Equal rights to ALL special privileges to
none" I sincerely hope, and I believe that
Mr.. Hoskyn hopes, that the discussion of
the merits or defects Of this plan may be-
come general, and would feel proud of the
Peoples Party of Minnesota, If, waving
none Of its other monetay plans, it would
at its next state convention drop the SUBJ
treasury plan and adopt the municipal plan
instead
Some singular objections have been made
in my presence by some sincere and in
telligent persons to the use of ponds as
basis for this municipal money issue. In
their minds the term bonds is associated
with the most gigantic swindlers and the
deplorable slavery Of modern times. They
therefore want none of them. little
tlOuSHl VIII easily QlSpel the preJuQlc6S
thus thoughtlessly expressed. Bonds
simply evidences of obligations When they
are forged, counterfeited, obtained by
fraud, they are hateful and oppressive
The bonds of slavery are damnable. But
the bonds of love, the bonds of sympathy
| the bonds of honest social organization are
most desirable. The bonds which repre-
sents an unholy compact whereby man
is bound to render forever the fruits of his
labor to a drone or tyrant in the form
Of inf Is 6axrio HOY of he INST
selfish and execeable motives But each
community owes it to every other COM
munity to recprocate all benefits con-
ferred. The city of San Francisco has
right to require that the city Of Boston.
should it obtain money from the govern
| ment the municipal plan, place in the
United States treasury the evidence of it's
intention to deal fairly by all the country
to redeem it's obligations to repay it's loan
in kind or value, and that it has kept with
in the limit of it's allowance. These evil
dences are the bonds of honor, the pledges
OF confidence and an anchor of faith
Since writing the letter for the Repre-
sentative concerning this plan, l have not
been able to resist the belief that 1T is sus-
ceptible of still greater simplification. In
stead of having the money signed by NUM-
cipal officers it might just as well be issued
from the United States treasury as treas
ury notes, with a statement on the back
that they are issued on the security OF GER
tain bonds and guaranteed. They
should bear the promise in writing as fol-
lows: The United States government prom
Uses to furnish to the bearer on demand one
(or any denomination dollars worth of any
kind of property With this charge 1 con-
fess it seems to me this plan is perfect.
AS stated in my former letter 1t involves
the principal of the national bank issue,
but takes the principle from a clique OF
bankers and long horned swindlers and
gives it to all the people This
plan would forever present those
senseless fancies which produce star
walton in the midst of plenty. The
panic which we are now passing through
is bankers panic, but it is the peoples
dire distress.
In this connection it is not improper to
mention the logic of the banking system.
We are now told that there is plenty of
| money in the country piled up in Eastern
banks How did it all get there? An
| illustration will suffice to show. Suppose
| the national bank issue to be s212 0O0, 600.
| This is loaned to So-called business men,
| who again loan it on real estate and other
mortgages, and buy interest-bearing bonds.
The interest paid by the government it's
bonds and by the people in their loans
| makes an average earning of at least 10
per cent per annum. If this be so, then
the principal will double itself every II
years What does this mean? The
amount Of national bank money does not
Increase. 1t has rather diminished in
! quantity. If the bank gets back all the
money it loans out in II years in the form
| of interest then where is the principal?
1t is apparent that the doubled wealth of
the banks consists of s212 coo in money
and $212, 100000 worth of the debtors prop
erty. They have the money all back, and
the same quantity in the mortgages
other securities of the same burdensome
character Then comes panic. The
people have neither money property
only experience. And these panics come
about every 10 years. The banks and
financiers call them periods of liquida-
tion.' That is to say, the people are
paying up their debts. At the present
time everybody seems to concede that
more money is needed in the country.
Even the banks, while they try to confuse
the people by pointing out the piled up
money in Eastern banks, insist that they
ought to be given 81 900 600 more money
by the government to supply the peoples
needs More than this, it is believed that
the Republican party, if it gets into power
will issue 00000,0O0 in gold bonds, and
that these will furnish the national banks
basis for getting a national gift of $780,
OOO,0O0 loan to the people. But will this
restore good times? There will be no diff
ficulty in issuing and circulating municipal
money, but it will be impossible to get
the additional bank circulation out to
the people Why? They cannot even get
the small amount which they now have
piled up, in circulation. The reason is
plain. They do not loan on mortgages
second mortgages. The whole country is
practically under mortgage. Few men
have what is considered good security
There will therefore be little or no call
for money. But the banks do not take
this view of the matter They demand
liquidation if it renders half the people
homeless. They close out all the mort
cages. They clear the titles of incum-
brances. They not only have the money
piled up in their vaults, but they or their
stockholders, have all the property in their
own names. Now they drive the prices
up. Now they sell out again to suckers
Now they loan their principal on the clar-
fled titles, and the larger their loans and
the more they have to loan on interest
the greater and more terrific are the panic
and ruin when the allotted 10 years drain
Is over. Only the farmer; he is permitted
to carry the same old load until he doubles
up with pain and sorrow, and drops into
his grave. Now that the free land is
nearly all gone, he will probably, in few
years, unless something is done to free
him, step down to the lower levels of
European peasantry or serfdom. Not the
least cause for this degradation is the ma
tional bank, which his vote, as much as
anybody's, has helped to sustain
We think this municipal money plan is
the specific remedy for this particular
organic disease, and while we believe it
does not affect or confuse the silver ques-
ton, 1t does affect, and If adopted will
crowd out the Ubiquitous national bank
system. FRANCIS H. CLARKE
Big Stone County Convention
BARRY. June %, A. d. 1894