The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1922-04-07
GUIDE TAKES issue
WITHREP. fOCHT
AS TOLOAN.RATE
Insists 1 Per Cent Month.
ly Not Enough for
Pawnbrokers.
DRIVES AWAY TRADE
Says None of This Class of
Loans Made in District
In Six Years.

Contending that per cent
month on notes and pawnbroker
loans Is not sufficient in Washington,
William r. GUIDE. a member of the
citizens committee. yesterday took
exception to the statement credited
to Representative Focht, that those
who loan money on the bare note
without pledge assert that / per
cent Is all they need"
Mr.. GUIDE. who for nine years has
been endeavoring to have the pres
ent loan law raised from / per cent
to Q per cent a month, made the
following statement:
Quotes from Record.
"On page 1866 of the COMPRESSION.
al Record, Mr.. Focht is quoted as
saying in the discussion of the pawn
brokers' bill on March 10, 1892, In
response to a question from Mr..
Burton:
Il will say that the gentlemen
who advocated having this measure
apply to the bare note without
pledge have argued that 1 per cent
Is all they need, and that even 1
per cent would be all that a pawn
broker would need, but the pawn
broker makes the contention that he
needs more. and we are discussing
the contention of the pawnbroker
rather than the man that Is salts
fed. What Is the answer to that"
1T is difficult to understand how
Mr.. Focht could make such a state
ment as this. because il Is contrary
to what was said at length in the
hearing.
Il. Nowhere in the hearing does
IL appear that those who advocated
the provision for other loans as we'll
as pawnbrokers' loans argued that
per cent Is all that is needed; and
1t would have been foolish for them
to do so. because the fact that not
one loan has been made under the
District law for more than six years
proves that l per cent per month is
not enough.
"2. The purpose of the Commits.
sioners' bill, which was advocated
In the hearing, was to secure ar
increase in the rate from the i'm.
possible l per cent to the 2 per cent
per month originally asked for.
Contention Of Citi.ens.
Commissioner Brownlow and va.
rious members of the citizens com.
mittee argued that per cent wa.
not enough in commenting on the
Dyer bill (p. 49,. in a letter to the
conferees dated January z. 1911;
(p. 22). in a statement that 1t ha,
been found impossible to start
business here at / per cent pei
month Opp. 81. 20 and So, and in
similar statements that / per cent
a month was not enough. with q
request for 2 per cent a month
opp. SO. IS and So. There are man,
other statements to this erec In
the hearing.
Tn addition to this II was also
explained. as to loans and notes
that although four large companies
doing a pawnbroking business 10.
Gated in Boston. New York. Chicago
and San Francisco were doing bust
ness at 1 per cent a month (p. 2os)
Those are all large cities. and
this business is a pawnbroking bust
ness entirely and not loans on
notes. small loans. as they are ordi-
narily understood. and there Is
nowhere in the country where the
small-loan business is now beng
done at 1 per cent per month
nowhere
"'Mr. Focht: On notesr
ANSWER: On notes.
1T was therefore argued that I
per cent per month was not enough
for loans on notes anywhere. nor
pawnbrokers' loans IN Washington
though 1t might be in larger cities
Quotes Mr. Focht.
"3. Mr.. Focht himself stated in
the hearing that those who -advo-
Gated provision for loans on notes
argued that l per cent is not
enough.
"'Mr. Focht: You concede that
this l per cent is not enough and
has not worked" Up. 2D.
"Mr. Focht: Then that is all
there is to it: 1t is only a question
OF the rate. What you want to say
then is that we need to change the
rate, that the present interest
charge of 1 per cent per month is
not enough.
ANSWER: Yes: that Is the case
"'Mr. Focht: Who Is responsible
for 1t.
taken In its judgment. It made II
1 per cent per month. and anyone
who reads the Record knows that
they meant to help the poor people
Up. 26).
TT is very strange that Mr.. Focht
should have forgotten all this; and
since II is SO plainly proved that
per cent is not enough for either
pawnbrokers' loans or other small
loans. and since all concede that
provision for other loans. on which
the Pennsylvania law allows 3h
per cent. is necessary as well al
for loans on pledges. il Is to bt
hoped that Mr.. Focht will correct
this error by advocating the passagt
of the Commissioners bill, II. r
5015. which will increase the rate
in the District law to 2 per cent