The labor journal. [volume] (Everett, Wash.) 1909-1976, 1916-03-10

essential to the transaction of bust
ness, is largely fictitious, that is, it
does not exist. The money" used in
business is of an entirelv di.t rent ma
ture from what capitalistic schools ol
political economy claim it is.
Two Kinds of Money
There are two kinds of money in
circulation. One is legal money and
the other credit money. Legal money
is issued by the government and is
legal tender for all debts, public or
private. 1t constitutes about 3 per.
cent. of the total circulation and is
used mainly for Change" Credit or
commercial money is issued by banks,
private persons and corporations.
Legal money is honest money-it is
a medium of exchange, issued by So
ciety government for the purpose
of facilitating barter and trade. IL
represents the credit of the nation and
has back of it the developed and I'M
developed resources of the nation.
Credit money is issued for the pur-
pose of getting interest by the parties
who manipulate it. 1t represents the
credit given to private persons and
corporations who borrow" it mot the
bankers who "lend' it) and is backed
by their individual wealth. 1t is used
as medium of exchange for pay.
Pay for Their Own Credit
The preposterOus part of our money
system is that the farmers, manufac-
turers, mine, railroad and telegraph
managers, in short, all business inter.
ests of the country, and the cities,
counties states and nation furnish ali
the credit money in existence and
then pay for the use of it. The habit
of paying some private individual or
corporation for the use of money has
become so strongly fixed by long u.s.
age, that it is difficult to give it up
although the necessity for it has en-
tirely passed away.
Money is the greatest labor saving
! invention of the ages. Without it a
world commerce would be impossible
In primitive ages when trade was
slowly emerging from barter, gold AM
silver were used for money. These
metals, on account of their glitter
malleability and nOn-corosive nature
were in universal demand for orna
mentation. This general demand
coupled with a limited but steady sup
ply, gave them value that fluctuated
but little and made them a standard
by which the value of other com
modities could be measured These
qualities also made gold and silver
mediums of exchange.
Credit Money Now Dominates
Gold and silver were current money
throughout the historic times, giving
away to credit" money as the inter
course between nations and between
IHulf luudlS anu SIOupS VI luulNluu
within nations became more and more
equitable, mutual and systematic.
The Bank of Venice issued its
notes" promising to redeem then
with gold on presentation at the bank
These notes" circulated throughout
the civilized world sometimes even a
a premium over gold on account O.
their greater convenience for trans
portation and daily use. The intro
duction of paper money stimulated
commerce to remarkable degree.
With the development of civilization
and the growth of confidence anC
trust in each other, metal money has
almost entirely given way to credi
money. Today only about 1 per cent
of money is in circulation in metal.
Instinctively, men fear the return
of barbarism through war and tn,
= fighting nations of Europe are pledg
, ing gold in payment of their wa
. obligations, indicating the possibilit,
, of the destruction of modern civilizs