Year: 1877

f: SUNDAY. AUGUST 10
property, and cannot be separated therefrom'
but are not the property itself. When We
buy title to property we pay for and in ef~
feet buy the physical actuality or right OF do
minion over it which the credit or.
title represents. When we sell titles
| or credits in excess of or sepa-
rate from the embodied labor they are
supposed to represent, We call the act sw1n-
| ding, and why? Because the title to prop
erty, where there is no physical actual1ty, IS
a fraud and delusion. The theory that
every thing is property that can be sold VIII
hardly be accepted by the man who buys q
title and finds that what it purports to rep
resent has no physical actuality- Mr. WELLS
thus defines the relation of debts to prop
erty:


Adebt is an eridence Of a transfer Of property or
Of serrtces and On <quita6e right to property itself
or to other equitable rights to property; but Tue
value of debt as right rests entirely on the CIR
cumstance that 1t ia power to appropriate tne fe'
cults OF embodied labor or physical ac1nal't'es.
A debt payable in merely imaginary things %ou4o
be an imaginary debt. AZ between debtor and crea"
tor, debts inchoate equitable titles. superior
and paramount to the debtors titles Tor they Will
finally absorb BY legal process the entire estate anu


interest Of tho debtor in the subect Of the lte to
the extent OF the money due The debtor usually
holds the legal title to property, with power
to sell, but be nevertheless always holds It -
trustee for his creditor that 10, subject to the
equitable right title Of the creditor TO the same
property. Debts, again, ore the Titles or the rep
resentatiues Of property or OF money due. a
warehouse receipt given for wheat IS title to Inc
wheat hut 1t lis not the wheat itsel1' nor 1s Tue
deot the property 1t represents. There is no value
in the debt except in the property which It repre-
sents, OF to which it is IN equitable title


In his opinion, Judge FOSTER said "that
property and a debt considered as repre-
sentative Of the property pledged for its pay
ment) constitute together but one subject
for the purpose Of taxation. The tax being
paid on the property without diminution on
account Of the debt, nothing remains to be
taxed. The debt indeed, aside from the
property behind it, and of which it is the
representative, is simply worthless" The
Connecticut Court conceded that in the case
of real and tangible property tho title is not
capable Of being severed from the property
and taxed separately in different jur1sdlo-
tions. But the debt, which WAS charge on
the property, an intangible right or interest
in that property, the Court declared existed
as separate property, and was taxable in
Connecticut.


The whole article Of Mr. WELLS will be
laid before the readers of THE TRIBUNE, and
no paper of greater interest has been pub
lished for years. He traces the effect of the
principles affirmed by this decision to its
logical conclusions We trust the paper will
have wide reading in this State, especially
by politicians who affect to treat capital as
an enemy of the human family. We trust
that the effect of the whole system Of taxa
ton Of credit or debt will bo carefully
observed. Wehope that every ma7 III Illinois
who has. q mortgage on his land will read
this paper and figure how much he pays
for the luxury Of having q law that
mortgages shall bo taxed There are out
standing in this State from two hundred and
fifty millions to three hundred millions of
dollars Of mortgages, bearing an average rate
Of per cent interest. Of these mortgages
there are twenty-five millions assessed and
taxed. But the legal inbility to be taxed
the fact that the law provides for the taxa
ton of mortgages-enters largely into the
arrangement for loaning money. Whatever
the rate of interest may be ut which the
lender would be willing to take the mort
gage, he invariably and reluctantly adds
thereto an average of 9 per cent to cover the
taxation to which he will be legally subject,
and which possibly he may have to pay. If
the State collects per cent tax on $25, 600, 900
Of mortgages, and the people pay in consid-
GRAFTON thereof per cent additional inter-
est on $500, ,00o,O Of borrowed money, the
economic wisdom which maintains this
policy may find in the result how severe is
tho punishment it inf1icts- II, in addition
to this, the nonresident mortgages ere to bo
taxed in their own States on the debts due
them in Illinois, then in all future contracts
the borrowers will have to pay, in the form
of an increased rate of interest, the tux i'm
posed by other States. The attempt in Con
necticut to collect taxes on money invested
and loaned in Illinois, to collect taxes on the
business done in this State, is but a part Of.
the same system of taxation of titles and
debts which is embodied in the Revenue law
Of Illinois, and which has cost this State SO
much, and which has repclled SO much cap
ital. The evils Of the law are felt in all
their force, while the attempts at compensa-
ton have proved, necessarily, abortivo.