Usury makes it possible to impose on the poor the principal burden of taxation. Though taxes are levied upon property it is a delusion to think that those who own no property pay no taxes. By usury the taxes are easily slipped upon the poor.
If the tax levy is one per cent. on property then in a year the one hundred dollars has been decreased by one dollar and is but ninety-nine, unless that dollar has been supplied from other earnings of the owner. Thus vacant lots, jewels and hoarded stores are a burden to their owner. But when the property can add to itself an increase, then there need be no diminution of the amount, and no sacrifice is necessary on the part of the owner. If the wealth is placed in the form of a loan on mortgage on a house, the tenant in his rental pays the interest on that mortgage, which meets the tax and also yields a revenue to the owner, and leaves the wealth undiminished. The tenant earned the tax, and both property and owner are relieved. The mortgage may be upon a manufacturing plant, when the operatives pay the tax from their earnings.
The bonded debt of a city or state, in the ultimate result, is collected from the productive labor. Topay the interest and principal of the bonded debt of a city the tax levy is increased, and a greater proportionate amount of labor is appropriated. Laboring people without property are often amazed at the indifference of property holders when a great bonded debt is incurred, as both interest and principal are to be paid by a tax upon property. Those who make the loan to the city, and all who hold mortgages and dividend paying properties, are complacent because the taxes of a hundred years would never diminish their property a dollar, though the tax levy should be doubled. It would raise the interest on money, diminish the price of labor and raise the price of goods, but those who profit by the gain of usury are untouched by it.
Recently complaints were made by the tenants of one of the poor districts of London because their rentals had been greatly increased. The reply of the landlord was direct and clear: "You have voted for public improvements and now you must pay for them."
The same is true of the interest and principal of the national debt. The revenue is raised from a levy upon importations, as, for example, tea, the tax on which is ten cents per pound. The tax is collected from the importer and by him attached to the price for which it is sold to the wholesale dealer and by him attached to the price he charges the retail dealer and by him the amount is collected from the consumer.Sufficient notice is usually given that the importer and the dealers may dispose of all their goods before the tariff is removed. A public announcement of such a purpose was recently made in reference to the tax upon tea.
The tax collected from the consumer is far heavier than the mere levy of the government. The importer demands a profit on the amount of revenue tax he has paid as well as on the amount he pays for the goods. This results in greatly increasing the burdens of the poor. The revenue tax recently imposed by Great Britain of three pence per cwt. on wheat and five pence per cwt. on flour resulted immediately in the addition of one penny to the price of the four-pound loaf to the consumers.
Again: This attributing to property the quality of self-perpetuation and increase has led to its incorporation and in a manner separation from those who own it. Property must always have an owner.
Personality must always come in else there are no rights to be considered. Labor apart from a person laboring and property apart from a person owning are impersonal and no ethical or moral laws can be applied to them. They are only physical forces and material things. The wind may push against a tree and overcome its resistance and the tree falls. That is merely an abstract force against a material thing. But when my energy is exerted against your tree and destroys it, then personal responsibility and personalrights must be considered. A righteous adjustment between labor and capital can never be arrived at without the consideration of the personal elements on both sides. The moral and ethical laws must be applied as well as the physical and economic.
Incorporated property, however, has eliminated from it the ethical and moral responsibility of personality and is regarded as possessed only of economic and physical qualities and restrained only by legal statutes.
Incorporated properties are not generally managed by those who own them. The managers are employed by the owners, who are ready to pay large compensation to those who have the tact and brain and nerve power and peculiar quality of conscience to gain for them a satisfactory increase. It is their work to press this irresponsible material body up against "flesh and blood."
The incorporation employs the laborer when his labor earns a satisfactory dividend on the capital, and lays him off or discharges him whenever it seems most to the advantage of the investment. A plant is built and operated for a time and then the plant is closed, or the location is changed without the slightest regard to the sacrifices of the poor laborers who have gathered around and are left stranded.
Laborers everywhere throughout Christendom need and beg for a Sabbath of rest, but neitherphysical needs nor conscientious scruples are regarded when a greater dividend can be gained in seven days than in six.
On the part of the workman, resistance is useless. He can do nothing but yield to the economic and physical force managed by those in whom human sympathy and pity for the suffering and helpless are not permitted. The dividend must be gained though it be necessary to grind the poor.
The owner of this steel plant is in a distant city. All employes, from the manager down to the porter, must so serve that he shall receive the dividend. This mercantile house is owned by a woman on a pleasure trip round the world. All who are connected with this business must so serve and sacrifice that she shall receive her income regularly. This railroad is owned by those who have gone a-yachting in southern seas. It must be so managed that the revenues shall not fail whatever the sacrifice required of others.
The writer once heard an American statesman, who afterward became President of the United States, deliver an elaborate and carefully prepared oration on a great occasion, in which he discussed the growing power and controlling influence in state and national affairs of incorporations. He did not formulate a remedy but said, "The problem to be solved by the next generation is, how shall the people be protected against the encroachments of incorporated wealth?" It need scarcely be said that therewas no discussion of that question during the campaign which closed with his election to the presidency.
Usury is both the basis of the incorporation and the instrument of its oppression. Incorporated wealth must not be permitted to claim personal rights and yet escape personal responsibility. It must be held to the same ethical and moral laws as the individual. Personal responsibility must not be eliminated from property. It must not be divested of personal responsibility and then pressed as a mere material thing up against "flesh and blood."
No instrument of oppression ever surpassed in severity the usury of incorporated wealth and retained the pretense of respectability. It is sucking the blood of the poor every hour, yet they cherish and pet the vampire, not realizing that it is their blood upon which it feeds.
Usury increases its burdens in proportion to the poverty. It is the most oppressive upon the poorest. Property in any measure is a relief. However small the amount may be, to that degree it assists in bearing the burden. Those who have a home are relieved of the burden of usury by rent. Those who own their shops or farms on which they can employ their labor are relieved of the usury of tools and material. From the conditions now prevailing the burden of usury rests on all those, the half of whose income is the product of their own labor. The one who receives one-half his income from the interest on property and one-half from his own labor has no advantage from usury. The income of his labor would bring him as many of the comforts of life as his labor now does, plus the income from his property. There is no advantage until a greater part of the income is derived from property. A small savings account, adding a few dollars annually to the income, is a very small offset to the constant drain from usury in all that we buy and upon all our earnings. The full burden however is upon those who have nothing but their own productive energy; who receive onlywages and must buy in the market. As the relief afforded by property decreases, the oppressive burden of usury in present conditions increases.
It is a fair estimate that usury is oppressive until relieved by the income from property to the amount of one-half of the entire income received. When less, the oppression begins and leans its full weight and without pity upon the poorest and most helpless.
He that has no property is dependent upon others for employment and in his wages must give a part of his product as tribute to the capital he uses. This, in the case of the average wage earner in this country, is not less than one-third, that is, he who earns one dollar and a half will receive as wages one dollar, the other half dollar is retained by the employer as due for the capital invested. Then having no home he must pay tribute to property in shelter for himself and family. The rent will be higher in proportion to the poverty of the apartments. The poorest tenement returns the highest rate of interest to the landlord.
His decreased wages do not make the necessities of life proportionately cheap to him. He pays usury in the price of the fuel which he burns, of the oil, gas or electric light in his home. In the price of vegetables, bread and clothes and shoes. There is an increased outgo at every turn which he cannot avoid. He is helpless to resist.
He can but struggle staggering along while work is given and his health and strength remain. When these fail he falls and must become entangled in debt, from which there is no hope of being able to extricate himself.
The state recognizes the hopelessness of the poor man who is in debt and has provided a relief by bankruptcy, by which he may again arise and struggle on. This discharge in bankruptcy is an act of mercy but the relief from the oppressions of usury would be an act of justice. Grinding the helpless poor between low wages and high prices and then relieving them by the act of bankruptcy is only pulling them out of the mill to throw them into the hopper again, for the wage earner who has no protection from any property is between these upper and nether mill stones.
Those who defend the fraud of usury always take to cover behind the widow and the fatherless. They plausibly pretend to be zealous for their protection while endeavoring to hide their own greed. Their pleas are often touchingly pathetic. "A thrifty loving father was taken away by death from a dear wife and sweet little ones. They had always leaned on his strong arms. He was their joy, their protector and their support. This widow and her fatherless children are left with nothing to support them except the saved hard earnings of this husband's life. As these earnings are their only support they are deposited with care with the 'Security Co.' for safety andthat the regular interest dues may be received without fail. If there should be one failure they would suffer. The 'Security Co.' loan their deposits as opportunity offers. They take some local mortgages and also some mortgages on western lands. They buy some bonds of a milling trust and also of a railroad and street car line and some national bonds and loan on personal security to local merchants and traders. From all these sources the interest is regularly collected and regularly paid to this widowed mother, without which she and her little fatherless dear ones must suffer. 'Certainly,' they say 'usury is not oppressive to the widow and the fatherless. Usury comes to the help of the helpless.'"
Another faithful industrious father was taken away from his wife and his little ones. He had been their stay and support. He was sober and thrifty but sickness and untoward conditions made accumulations impossible. When he, the head of the home, was taken away there was nothing for the support of these helpless little ones and their widowed mother but her own arms and head and heart. There was no time for sentiment and tears. These little ones must be sheltered and their hungry mouths must be fed. Restraining her grief, she bravely undertakes the heavy task.
She rents a room but the rental is high, for the interest must be paid on a mortgage held by the Security Co. She finally finds a shop where shesecures employment but the wages are low, for the shop is heavily mortgaged to the Security Co. and the interest must be paid or the shop will be closed and even this opportunity for scant wages will be lost. The distance requires that she shall ride to her work but the round trip costs two nickels and one of them goes to the Security Co. for interest on their bonds and stock. She buys a loaf of bread but the wheat was raised on a western farm mortgaged to the Security Co. and the interest was charged up against the wheat. The wheat was floured in a trust mill and the interest on the Security Co. bonds were charged up against the flour. It was transported by a railroad that charged up against it the interest on the bonds held by the Security Co. It was baked in a mortgaged oven and handled by a local dealer doing business on capital he had borrowed of the Security Co. How much of her bread money went for interests is an intricate problem. She only notices that her loaf is small.
The same oppressive tribute must be paid on all that she buys to feed and clothe herself and her little ones.
The first widow does not live upon the earnings of her husband. They are untouched at the end of a year nor diminished as the years pass. By the operation of usury she has lived upon the hard earnings of this poor widow. The laborers on the western farms contributed to her support in decreases of wages;the operatives of the railways, the workmen in the mill, the baker and merchant all contribute a portion, but it cannot be denied that the heaviest burden comes upon the poorest. The rich widow has fed her children with the bread which the poor widow earned.
The flaunting sympathy for the poor of those who themselves feed upon them, is rank hypocracy. Nor can those who have grown fat by the practice of usury, condone the crime by tossing back to them a portion of the unjust gain.
"Is it such a fast that I have chosen? A day for a man to afflict his soul?... Is not this the fast that I have chosen?... To undo the heavy burdens and to let the oppressed go free?... Is it not to deal thy bread to the hungry, and that thou bring the poor that are cast out to thy house?"
The dictum of Bacon that "Usury gathers the wealth of the realm into few hands" is readily proven and fully verified in the experience of these times. The tendency to centralization under a system of usury or interest-taking is so strong, and the modern result so apparent that the statement only is necessary.
Usury not only enslaves the borrower and oppresses the poor who are innocent of all debt, but it also affects the rich by gathering the wealth of the wealthy into fewer and fewer hands. There is a centralizing draft that threatens and then finally absorbs the smaller fortunes into one colossal financial power. It is as futile to resist this as to resist fate. Wealth cannot be so fortified and guarded as to successfully resist the attack of superior wealth when the practice of usury is permitted. The smaller and weaker fortune, using the same weapon as the larger and stronger, must inevitably be defeated and overcome, and ultimately absorbed.
Rates of interest do not affect the ultimate result. Under a high rate the gathering is rapid, under a low rate the accretions are slower, but the gathering into few hands is none the less sure. Rates of interestonly place the convergent center at a nearer or more remote period.
If any interest is right, compound interest is right. When simple interest is due and paid, it may be loaned to another party, and thus the usurer secures interest upon his interest, though not from the same debtor. When the interest is to be paid annually, it is to be assumed, if not paid, that the debtor takes it as a loan in addition to the face of the note of his obligation. This saves the care of receiving and re-loaning to another. The custom of usurers, however, is to renew the note, adding the interest to the face, if unpaid. The mass of bank paper is renewed each ninety days: Compounded four times a year, whether to the same or to another debtor, the result in accretion is the same.
Few realize the rapidity at which a loan increases, accelerating in geometrical progression as time passes. Any loan will double itself at three per cent. in twenty-three and a half years; at seven per cent. in ten and a fourth years, and at ten per cent. in seven and a third years. One dollar loaned for one hundred years, at three per cent., would amount to nineteen dollars; at seven per cent. one thousand dollars, and at ten per cent. thirteen thousand.
The island upon which New York stands was bought from the Indians for the value of twenty-four dollars by Peter Minuits in 1626. Yet, if the purchaser had put his twenty-four dollars at interest,where he could have added it to the principal at the rate of seven per cent., the accumulation would now exceed the total value of the entire city and county of New York.
M. Jennet quotes the elaborate calculation of an ingenious author to show that 100 francs ($20) accumulating at five per cent. compound interest for seven centuries, would be sufficient to buy the whole surface of the globe, both land and water, at the rate of 1,000,000 francs ($200,000) per hectare (nearly four square miles). From this we can gather that $20 at five per cent. compound interest for 700 years, would buy all the earth, mountains, and swamp lands, and water, at $80 per acre.
Another mathematical genius says, had one cent been loaned on the first day of January A.D. 1, interest being allowed at the rate of six per cent. compounded yearly, then 1895 years later—that is on January 1, 1895—the amount due would be $8,497,840,000,000,000,000,000,000,000,000,000,000,000,000,000 (8,497,840,000 decillions). If it were desired to pay this in gold, 23.2 grains to the dollar, then taking spheres of pure gold the size of the earth, it would take 610,070,000,000,000,000 to pay for that cent. Placing these spheres in a straight row, their combined length would be 4,826,870,000,000,000,000 miles, a distance which it would take light (going at the rate of 186,330 miles per second) 820,890,000 years to travel.
The planets and stars of the entire solar and stellar universe, as seen by the great Lick telescope, if they were all in solid gold, would not nearly pay the amount. A single sphere to pay the whole amount, if placed with its centre at the sun, would have its surface extending 563,580,000 miles beyond the orbit of the planet Neptune, the farthest in our system.
It may be added that if the earth had contained a population of ten billions, each one making a million dollars a second, then to pay for that cent it would have required their combined earnings for 26,938,500,000,000,000,000,000 years.
Anyone can figure on this and see if it be correct.
Had Peter only thought to put one cent at interest, there would be no call now for Peter's pence.
With any accretion allowed, the concentration of wealth is irresistible. However small the amount of capital, if permitted to grow at any rate of increase it will ultimately absorb everything. Any finite quantity permitted any finite rate of increase, will, in finite time, gather all that is less than infinite.
The only difficulty in this accretion is to secure debtors that will not die. We inherit the property of our fathers, but fortunately we do not inherit their personal debts. This difficulty is being overcome by bonds of corporations and nations that live on, though the individuals composing them may, age after age, pass away. This makes the increaseperpetual. Generations may come and go, but the concentration of wealth goes uninterruptedly on.
This is not visionary theory, but is shown in the practical results everywhere apparent.
The usurers of England, a little over two hundred years ago, secured a charter for a bank on the condition that they loan the crown or government 1,200,000 pounds sterling, about six million dollars.
This was a perpetual loan, never to be repaid, but annual interest at eight per cent. was to be paid by the government forever. This constant annual interest paid to this bank has made it such a financial power that it reaches and draws to itself of the resources of all lands. The aggregated wealth of the institution, if the accretions were continuous, would now be $25,165,824,000,000. The wealth of the United Kingdom is estimated at fifty billions, and all Europe two hundred billions, the United States seventy billions, and the whole world's wealth at five hundred billions.
Were the accretions of the bank at eight per cent. undisturbed and unconsumed, it would now take fifty worlds as rich as ours to pay that debt. It is sometimes wondered how there can be such an accumulation of wealth in one institution as to control the finances of the world.
It is often attributed to superior wisdom or some profound, occult manipulation. It is but the naturaloperation of the principle of interest—accretion from age to age.
The managers may be stupid dolts, only so they do not interfere with the usurious principle in its eternal pull on the resources of mankind.
The interest bearing debt of the United States, at this date, is about one thousand millions. This in one hundred years at six per cent. would amount to $340,000,000,000; five times the whole present wealth of the nation.
The smallest national bank organized, by the deposit of $25,000 of bonds yielding two per cent. interest, and permitted to re-loan the same funds to its private customers at eight per cent., could gather to itself in one hundred years, $345,225,000.
The wealth of an individual or of a family may also grow with the years as they pass. The property may be in public bonds or that of incorporations, requiring no care or effort on their part, yet it may be continually increasing. A usurer in any community in one life comes to absorb the wealth of that community, though the amount loaned at the beginning was small.
The accretions are the irresistible result of the principle of usury.
The wealth is more and more centralized as the years pass. Great trees in the forest shadow the smaller, and rob them of the sunshine and moisture until they perish. Great fish in the crowded pondfeed upon the smaller. Individual manufacturers are absorbed by the great combinations called trusts. The stockholders of a railroad are absorbed by those who have large and controlling interest. But the railroad is itself absorbed by another yet greater corporation, and this again by a great combine that eliminates the influence of all but the chief control, and tends to a complete centralization of all the systems.
There is no escaping from this centralizing draft upon all resources, when the system of interest-taking is as general as now. Freedom from personal debt does not deliver us. The farmer, the most independent of men, in his own home, free from personal debt, yet must contribute to this centralizing by paying interest on bonds in every shipment of produce, and every mile of railroad travel. He pays tribute also in all the tools that he buys, in the food that he eats and the clothes that he wears.
This centralizing draft is constant, though not always equally apparent. Certain favorable conditions may hold in check, for a time, the adverse influence and cause a temporary distribution of wealth to the producers. Its force is not, however, destroyed, but only restrained for a time, and then draws with accumulated power.
Times of industrial depression and commercial disasters are occurring over and over again. Some economists attribute them to the peculiar industrialand monetary conditions of the periods in which they occur; but they have seldom agreed as to the causes of any particular panic. They are so regular in their recurrence that some economists have thought they must be produced by some constant cause; like the moon causing the tides of the ocean. Both are true. There is a general and there is also a secondary or superficial cause.
The times of greatest commercial disasters in this country were in the years 1809, 1818, 1837, 1873, 1893.
The political economists can assign as reasons some peculiar conditions prevailing in each of these periods, but the wisest have never gone deep enough to discover the general cause; this constant centralizing draft of usury.
In these periods of commercial disaster there is no destruction of property. There is only a general shake up and redistribution. All the wealth of the country remains, but after the disaster wealth is always found to be in fewer hands. Some have become rich, many who were thought to be wealthy are ruined, and the number of the poor has been multiplied.
A patient may be afflicted with some deep-seated, chronic disease that makes him very easily affected by a change of the weather, by a change of his diet or of his bed, and these may be assigned as the causes of his frequent relapses, and they are the immediateor secondary causes, but the real cause is the deep-seated, chronic disease. Cure that disease and the changes in conditions, now so serious, would not be noticed by the healthy man.
The real and constant cause of our recurring financial disasters is this centralizing usury that directly opposes the distribution of wealth that is natural, when the producers of wealth are permitted to receive and enjoy it. Root out this evil, and then the trifling differences in our harvests, changes in our tariff laws, currency legislation, and the score of other things that now affect us, would be unfelt by the healthy body politic.
If this centralizing power is destroyed then the natural distribution would be undisturbed, and these, so-called, panics would be unknown.
The debt habit has been diligently cultivated and encouraged, until the nations are enslaved. Public bonds imply bondsmen, and the nations are no longer free. There is a mortgage upon the inventive genius, industry and productive energy of the world.
Usurers greatly prefer an organized government as a debtor. The individual may die, but a nation's debts bind from age to age, are bequeathed by the fathers to the children, and thus descend from generation to generation. The bonds of no corporation, however great and rich, can be so secure. They embrace special industries, while national debts are a claim upon every industry and a mortgage upon every foot of soil, and every dollar of present personal property, and of all that may be produced in the whole realm.
If we express the world's indebtedness, the national debts, in the terms of our currency, as nearly as we can reduce the currency of other nations to such an expression, we find the national debts as follows, in 1890:
Denmark$ 33,004,722Great Britain3,848,460,000United States915,962,112Germany1,956,217,017Austria-Hungary$2,666,339,539France4,446,793,398Russia3,491,016,074Italy2,324,826,329Spain1,251,433,096Netherlands430,539,653Belgium360,504,099Sweden64,220,807Norway13,973,752Portugal490,493,599Greece107,306,518Turkey821,000,000Switzerland10,912,925These debts aggregate$22,955,386,008
Hundreds of millions have been added to these national debts in the last ten years. Nearly every nation has increased its indebtedness, possibly no nation has decreased it, and others, like China, with its recent great loan, and little Korea, with its twelve millions, must be added to the list. The debts of the nations of Europe have been increased until they now amount in the aggregate to twenty-three billions. The debts of the nations of all the world have increased one-half since 1890, and now aggregate thirty-three billions.
These great national debts are practically perpetual, and though they may be at so low a rate of interest as three per cent., they absorb the energies of the people, and, like a glacier grinding over the earth, crush all beneath them.
Public debts are incurred to relieve the present wealth of the burden of present duty. Debts place the whole burden on producers of the future. Theyrelieve those who hold the wealth now, but are a draft upon those who make the wealth that is to be.
An individual incurring debt places a mortgage upon his productions; by a pledge of future production he relieves himself of the strain of the present.
A family incurs debt; a part of the members of the house are strong and capable of productive labor, and a part are not; the whole burden of the payment comes upon the productive members of the home. The weak and helpless and the indolent, though strong, bear no part of the burden. This family has a home, and a mortgage is placed upon it to secure the present needs. The burden of paying the interest on this mortgage, and the final payment of the principal, is wholly on the capable and industrious members of the family.
National debts are incurred to relieve the present wealth of the burden of present government calls and obligations, and to roll it upon those who shall produce wealth in the future. So the debt of a city, state, or nation is a present relief to property holders, by placing the producers under future obligations.
A street in a city is to be paved; no additional tax is levied; but bonds are issued running twenty years.
This relieves the present wealth of the burden, placing it upon those who shall produce the wealth that shall be in twenty years.
The expenses of a great war must be met. Present taxes may be slightly increased, but to meet theburden consols or public bonds are issued to be paid at a distant date. This relieves the present wealth, but binds it upon those who shall be the producers of wealth in the generations to come. Hume says, "The practice of contracting debts will almost invariably be abused by every government. It would scarcely be more imprudent to give a prodigal son a credit with every banker, than to empower statesmen to draw bills in this manner on posterity."
These public bonds are the golden opportunity of the usurers. Not only is their wealth relieved of all burden, but it affords an opportunity of profitable investment with the best possible debtor. They can pose as enterprising citizens, and urge great public improvements, and at the same time gain a most sure and profitable investment. They can pose as patriots in time of war, and urge that it be pressed with energy at whatever cost of treasure and blood. It is not their blood that is shed, nor their wealth that is wasted. It gives them the opportunity of binding their burdens on the nation for the producers of the coming generations to carry.
Usurers never wish public debts paid. They wish them issued for as long time as possible, and then reissued, or the time extended before they are due. This is done by the figment called refunding, as if it were a concession and favor to a poor debtor. It is but a device to keep the burden on the public back. It is not a financial feat and triumph for the chancellorof the exchequer to refund a public debt. He but yields himself as a tool to the usurers to continue their loans. They resist the payment when due, but when an officer is found willing to extend them before they are due all trouble is avoided and the accretions of interest are not interrupted for a day.
Those who hold the bonds of a nation direct its destinies. The nation borrowing is servant to the lender, just as an individual. The nation compromises its freedom and becomes the slave of its bond-holders. The usurers use their power for the advancement of their own material interests, and hold all other purposes of government as inferior to their own ends. This subordination of a people, to the creditors, is fatal to republican and constitutional governments; the form may be preserved for a time, but the substance of free government has departed.
The concentration of wealth carries with it the concentration of power, and is inimical to republican institutions. A proper distribution of wealth and power must be preserved or popular government is put in jeopardy.
The first bank of deposit and discount was the Bank of Venice, in the republic of Venetia. It continued its existence for six hundred years, until the government that gave it life itself perished. From its long continuous business, and its success as a bank, it has been spoken of in every work on banking as a model. It began its association with the republicin 1171, and dominated it, sapping its life, and assuming its functions, until the bank practically ruled the state, and when one fell both perished in 1797. The usurers received their hold on the state in a time of the greatest need. The republic had been impoverished by the crusades, and was in dire financial straits. Advantage was taken of this by the usurers to so bind the bank and state together that when one lived the other must, or both must die together. Stock in the bank was a loan to the state at four per cent. annual interest. The union seemed to promise great prosperity for a time, but really absorbed all the republic's vitality during the last hundred years of their life.
Venetia was at the first a pure democracy. The Doge was elected by the people and administered the government, himself being the responsible head. He, later, chose advisers, or a cabinet, to be associated in the responsible duties. After this, and about the time of the association with the bank, a representative council was elected by the people, and the government was administered by the Doge and this council. This was gradually transformed from a government of the people to an oligarchy; and as the years passed there were no steps taken toward a return, but the authority and power was more and more centralized. The ruling class was, in a hundred years, limited to those families enrolled in the "Golden Book." In another hundred years thegovernment was in control of the "Council of Ten." Later the secret tribunal of three was the terror of the people and the instrument of their oppression. The republic was only such in name, the people were deprived of all voice in the government, and the Doge became a puppet to obey the ruling cabal.
Shakespeare went to Venice to find his typical usurer in Shylock the Jew. He found there also his typical Christian, Antonio. Antonio was a benevolent great soul, who loved his friends, supported all benevolences, and hated the usurers. Shylock hated him because he would lend without interest, and was constantly reproving him for his usurious practice.
The contest between the usurers and the people of the Venetian republic was a struggle for the life, but the usurers never relaxed their hold. They dominated until the end.
Another great triumph of the usurers was in England at the time of great need. William and Mary had been placed upon the throne by the Protestants, but were in need of money to carry on the struggle for its complete establishment. This was the usurers' opportunity. Former kings, in like straits, had confiscated the wealth of the usurious Jews, Lombards and Goldsmiths, and appropriated their property as a penalty for their unchristian practice, but William and Mary entered into a contract with them to gain their assistance, giving them special privileges to secure a permanent loan. They were to loan thecrown 1,200,000 pounds sterling. This was never to be repaid, but interest at the rate of eight per cent. per annum was to be paid forever. This loan was a marvel of success. There was a great rush of usurers to place their money with the crown as a perpetual loan at that rate of increase. Their usuries, which had hitherto been counted dishonest gain, were henceforth to be honorable, and they esteemed as patriots.
Thus, the first Protestant power in the world was established in the hands of usurers, and bound to continue associated with them forever. The story, by Macauley, of the establishment of the Bank of England, is familiar to all students of English history.
This bank is a great corporation; the Board of Directors is composed of twenty-six members, who elect their own successors, and thus it is entirely independent. It makes laws for its own direction in the name of the people or defies their control. In 1797 it secured an order from the privy council ordering itself to suspend specie payment. It obeyed its own order promptly, and at the same time announced their strength and that the order would be temporary; but for one excuse and another it was continued for twenty-five years.
Sir Robert Peel, in 1844, having become convinced of the dangerous and disastrous influence, expanding and contracting its loans, secured the enactment of a law to regulate and limit its circulation. This lawwas distasteful to the bank, and was, upon its enactment, defied by open disobedience. It has not only dictated the laws for its own regulation, but directed both the domestic and the foreign policy of the government. It has subordinated the public weal to financial profit. This corporation of usurers manage all the finances of the kingdom, and has more influence than Crown and Parliament combined. As a great uncrowned king it dictates the diplomatic policies of the United Kingdom. Its influence has not been extended to promote Protestant Christian faith, Jews are not zealous for any Christian sect; nor for the purpose of lifting up the degraded and enlightening them; nor in the east has it exercised its power to relieve human suffering, but its diplomatic policy has been mercenary greed always.
It should be noted that the enlightened Christian people of the United Kingdom are not the English government. There has been, for two hundred years, a power behind the Throne, behind Parliament, behind the people, essentially selfish and commercial. This has controlled India for profit, while the benevolent people were anxious to christianize and uplift. It has befriended the Turk while England wept over the Turkish barbarities. It forced opium upon China while the Christian people sent missionaries. The people of England love freedom, yet the government has endeavored to crush it in the American colonies and everywhere throughout theworld, when in conflict with a selfish commercial policy. The English people cry out against human slavery, yet in the struggle in the United States, when slavery was in the balance, the English government earnestly espoused the cause of those who upheld slavery. The English people rejoiced that the slave trade in Africa was abolished, yet the government enacted the hut tax, and compels now the service of the young and vigorous blacks in the mines, sending them back to their people when their strength declines.
In the establishment of the republic of the United States there was a strong resistance to any debt or subordination to usurers. The history of banks in the United States shows a struggle at the birth of the nation between the usurers, who demanded the management of the finances, and the people who resisted. This struggle continued for half a century, when the people triumphed, and for thirty years there was no hint of a purpose to overthrow what was regarded as the settled policy of the nation.
The first bank was incorporated in 1791. Its establishment was strongly resisted, but being urged by the Secretary of the Treasury, a charter was granted for twenty years. When that charter expired by limitation in 1811, there was a struggle by the usurers to secure its renewal, but they were defeated. They did not, however, abandon their effort. In 1816 they secured the charter of the second bank of the UnitedStates. This charter was also limited to twenty years, expiring in 1836. There was a tremendous struggle for its renewal, but the chief executive, backed by a strong political party, so completely defeated it that the usurers for the time yielded, and for thirty years the settled policy of the government forbade the alliance with usurers and the making of any public debt. Many of the leading statesmen of that period were very pronounced in their opposition.
"The banking system concentrates and places the power in the hands of those who control it.
"Never was an engine invented better calculated to place the destines of the many in the hands of the few, or less favorable to that equality and independence which lies at the bottom of our free institutions."—J.C. Calhoun.
"I object to the continuance of this bank because its tendencies are dangerous and pernicious to the government and the people. It tends to aggravate the inequality of fortunes; to make the rich richer, and the poor poorer; to multiply nabobs and paupers, and to deepen and widen the gulf that separates Dives from Lazarus."—Thomas H. Benton.
"I sincerely believe that banking establishments are more dangerous than standing armies. I am not among those who fear the people. They and not the rich are our dependence for continued freedom. And to preserve their independence, we must not letour rulers load us with perpetual debts."—Thomas Jefferson.
"Events have satisfied my mind, and I think the minds of the American people, that the mischief and dangers which flow from a national bank far overbalance all its advantages."—Andrew Jackson.
The usurers were compelled to remain under public condemnation during thirty years, as sentiment was strongly against them and conditions were not in their favor, but they did not relax their watchful effort nor abandon hope of ultimate success. When the nation was struggling to prevent its dissolution in 1861-5, and unusual war measures seemed necessary to meet the great emergency, the usurers saw their opportunity and came forward, as they did in Venice and England; they would loan the government the funds necessary to carry on the war, if the government would comply with their conditions and grant them the privileges demanded. They asked that their loan be perpetual, like the English loan; that they should be freed from the burdens of the government; that their loan should be free from taxation; that they should receive their interest semi-annually, and not in the common legal tender, but in coin; that they be permitted to issue their own notes as currency to be loaned to their customers; that the government discredit its own issues and endorse theirs; and that they be given a monopoly by taxing out of existence all opposition.
These were great demands, and were regarded as extortionate and oppressive. The struggle was severe, but the enemy in the field was threatening the life of the nation, while the usurers were urgent and posing as patriots, that they might accomplish their ends. True patriots, anxious to defeat the enemy in arms, regarded these usurers at home as equally the enemies of freedom. They were in a strait betwixt two foes.
Secretary McCullough said, "Hostility to the government has been as decidedly manifested in the efforts that have been made in the commercial metropolis of the nation to depreciate the currency as has been by the enemy."
The opposition to the usurers was very strong and bitter, but the conditions were in their favor and they gained a decided advantage. In the Senate the vote stood twenty-three yeas to twenty-one nays. It was carried only as a war measure. There was an effort to limit the usurers' privileges to the war and one year after its close. This was not successful, but their loan was confined to the war debt, and their time to its payment, limited to twenty years.
This action caused great distress and dark forebodings of evil to many of the thoughtful. It was setting aside the policy of the nation, which had been generally acquiesced in as wise and judicious and safe for many years. The old patriot Thadeus Stevens, in the opening of a speech in a preliminary skirmish betweenpatriotism and usurers, said: "I approach the subject with more depression of spirits than I ever before approached any question. No personal motive or feeling influences me. I hope not, at least. I have a melancholy foreboding that we are about to consummate a cunningly devised scheme, which will carry great injury and great loss to all classes of people throughout the Union, except one." Later he said, in excuse of the action, "We had to yield, we did not yield until we found that the country must be lost or the banks gratified, and we have sought to save the country in spite of the cupidity of its wealthier classes."
The usurers have never relaxed the hold they secured by this victory, and have since been continually increasing their power. They obtained an extension or "refunding" of the war debt, and a renewal of their charters by the general laws, so their hold is indefinitely extended. Bonds are no longer limited to the covering of war expenses, but are issued freely in times of peace. The traditions of the fathers have been cast to the winds, and their fears derided and their policy changed. The usurers have been firmly in the saddle for many years, and have defeated every effort that has been made to unseat them.
The great debts of the nations have brought all mankind into subjection to the usurers. Those who hold the bonds have the destinies of the race in their hands. They pervert the ends of government; theprotection of life, liberty and the highest good of all the people; they make governments their tools to gather and appropriate the earnings of the many.
They have exalted Mammon upon the throne of the world, and scoff at the God of heaven, who seeks the poor and needy, and who would in love lift up every son and daughter of the whole race.
Milton presents Mammon as one of the devils cast out of heaven with Satan, and as saying in the council of the demons, "What place can be found for us within heaven's bound, unless heaven's Lord we overpower?... How wearisome eternity so spent in worship paid, to one we hate."
The reign of Mammon subordinates character and virtue and liberty and human life to sordid gain, yet he holds the scepter of power.
He elects legislators and senators. He elects governors or directs their arrest if they refuse to obey him. He elects presidents and dictates their policies. He places kings on their thrones and holds them there while they do his bidding. He strips a Khedive of power, and yet retains him as a collector of revenue. He steadies the Sultan's tottering throne, and compels six great Christian powers to stand by in silence while humanity is outraged. The Armenian's blood must be permitted to flow because the persecution is by a great servant, the Sultan, who pays interest on bonds, and his victims are only freemen. The murder of one hundred thousand Armeniansmeant nothing to Mammon. But when the Cretans were persecuted by the same Sultan, the suffering and bloodshed was soon ordered stopped by these same six powers, at Mammon's command. The Cretans were servants of the common master; the Cretan bonds were endangered. The cry of suffering humanity came up to deaf ears, but the cry of endangered bonds was heard from afar by this reigning god of wealth.
The little republics of Africa were freemen, and therefore Mammon sees them strangled with indifference. Mammon gathers the civilized nations around China and demands that she shall be enslaved by all the bonds she can safely carry or submit to vivisection and distribution.
This enslavement of the race is not by the destroying of intelligence, nor by denying the first principles of civil liberty, nor by crushing the aspirations for freedom, but by producing conditions that make the application of these principles and the exercise of freedom impossible. Though the race may increase in intelligence and theoretically have correct views of personal freedom and civil liberty, yet the conditions produced necessarily by usury utterly prevent their realization. The intelligence and aspirations of the race never were higher than at present, their subjection and subordination to material wealth was never more complete.
The scepter wherein lies Mammon's power to sway the nations is usury. When bonds bear no increase his sovereignty is gone. All motive to involve the nation in debt at once disappears, and the power to control is lost. Moses' law was divinely wise that forbade interest, that his people could not be enslaved and might remain a free people forever.