The herald., 1896-01-02
Loans To. Not From. the People


ity for the sentiments expressed.l
Loans To, Not From, the People
EDITOR HERALD-In Saturdays HERALI
is a brief contribution signed "Wes
Hughes" proposing as remedy for thu
financial embarrassment of the govern
ment, loans from the people of the United
States, in sums of $50, 500, $500, etc., tt
the extent of 500, 100000 or more, ant
the government issuing therefor its bonds
at a low rate of interest. The writel
thinks that the patriotism of the people
would cause them to ''respond with en-
thusiasm," and sin six months to take
$50O,O00,0 900 WORTH of these bonds. AL
though he does not say so, it is, of course
to be presumed that the people would
draw the 4 per cent. interest that is now
paid ito few foreign bankers, who in
time Of national disasters are serious
menace to our prosperity"
While | agree that such a scheme would
be an improvement on the hackneyed for
eiRn policy of my old. ime Ohio friend
Senator Sherman, by which millions OF
dollars are every year contributed by the
United States to support ana enrich Eng
lish capitalists, in the way of interest on
bonds, still l think there is better way
even than the improvement, by which the
uceSSu tulluOLS Oh IuOllty Illdy Oo Idlocu'
not only for ''the present emergency" but
in more prosperous and peaceful times.
With our liberal editors leave l will
state it:
1t will be admitted by every reader Re-
publican, Democrat, Populist. and even
foreign capitalist. that the foundation of
the credit required to float the bonds neces-
sary to raise money is the solid and re-
liable responsibility of the United
States government itself, or the peo-
pie back Of it whom it represents.
Without this, foreign bankers would not
advance the money for our bonds, nor
would our own patriotic citizens long con-
tinue to do SO, if the general government
should continue unstable and the individ-
ual states shattered with dissensions and
governmental conflicts. But it is presum-
able that our own people have more con-
fidence i'll the stability of our government
financially as well as organic-than for
eigners; therefore those who have money
enough, over and above their own personal
cheerfuly do SO. 1t is evident, then, that
the character and condition of the Amer
lean people and their government are
what give value to the paper bonds that
may be issued for their benefit.
This being the case, why have any inter-
mediate agency between the government
and those to whom it is indebted for sal
with to cancel the same? Its greenbacks,
treasury notes, or whatever else they may
called. would be just as valuable as the
present forms of bonds. They are nothing
more than "promises to pays" and when
paid with the proceeds of subsequent
bonds, issued for the purpose, and still but
promises, possess no more intrinsic value
than greenbacks or treasury notes.
What l propose then-and it is the
policy of many thinking and sagacious
business men all over the country-is. that
the government take advantage of it's
financial credit and trustworthy standing
and loan its responsibility for what it is
reasonably worth in the way of interest,
instead of giving capitalists the advantage
of it. and paying them per cent bonus in
addition. Have congress pass bill
authorizing the treasury department to
issue greenbacks and treasury notes of
larger amounts, to be loaned to the people
on satisfactory security. at or 3 per cent
lnterest-the extreme amount that agricul-
tural lands will warrant in the way of in
terest on mortgage loans. Let the issues
be gradual and not to exceed. to the money
now in circulation. over $50 or $35 per
capita. The interest should be required in
advance. or taken out OF the amount
loaned, and collected annually in advance,
which, at the low rate of interest can well
be afforded, and thus render the ere dit
more safe.
Such loans would be taken freely enough
to afford the government all the revenue
necessary to supply its various depart
ments, at but slight addition to the pres
ent expense of running them. BY saving
the expense of interest on bonds, and hus-
banding other sources of revenue. the pres
ent public debt might in time be paid off,
which never will be or can be done under
the present financial methods.
Another consideration. and not the lea at
important, in favor of this financial scheme
is, that it would afford like facilities to all
classes of citizens for enjoying the benefits
to be derived from its adoption. The bor-
rowing, or bonding, practice benefits only
the wea THY and well-to-do, who have by
one hocus-pocus or another accumulated
sufficient money to enable them to loan to
the government at good rate of interest,
and TO thus increase their wealth and rem
der it more secure.
But how is it with the more numerous
class Of our people-the industrial and pro-
ducing men and women of our land? This
special legislation that helps the capitalists
TO increase their bank accounts whether it
rains or shines-whether business is pros
porous or disastrous. and the more disas-
trous to the poor the better for the rich as
a general thing-increases the burdens OF
the poor. Not only are they deprived of
the pay to be sucked from government
bonds, but they are compelled to contrib
ute to this pap by paying more, in the way
of tariffs. etc., and for everything they
wear, and much of what they eat.
And those farmers, mechanics and other
producers whose little property is mort
gagged are forced to bear a large part of the
expense of carrying these bonds. While,
if the government should loan its credit in
the way of money to all alike on the same
terms, the rate of interest on mortgages
would speedily be reduced and the poorer
classes would be benefited proportionately
with the rich. We would have no more
ten. eight or even six per cent notes secur.
ed by mortgages. Shylock's occupation
would in truth be gone and prosperity and
happiness prevail. ELIAS LoNGLEY.
South Pasadena, December %, 1895.