of any reserve, we will now state what we consider to be desirable, if practicable.

That our money system is defective-extremely defective; that it has run into excesses; that it is responsible for the social corruption and demoralization; the dislocation of labor, and consequent scarcity and high prices of all articles of provision; that there exists redundancy of the currency, and that the standard of value is thereby depreciated, we presume no one will deny. The evil has existed, exists still. How to cure it? This is the question.

The disease, so to speak, being chronic, no good physician would employ or counsel the employment of an active treatment, of strong remedies. Whatever the measures, therefore, of which the government may avail, they should be applied in a gentle manner so as not to aggravate the condition of the patient. His morbid condition disposes him to prostration, and great tenderness is therefore necessary. Nor is this mode of treatment rendered the less necessary by the fact, that his unhappy condition arises from a violation of all the principles of prudence. A kind hearted physician does not resent the failure to observe a diet, nor the neglect even of his remedies by the patient. Thus let us deal with our monetary, economic, and social sufferer; and thus proceeding, without entering, in the slightest degree, upon the legal question of vested rights, with which we have nothing to do, it is our opinion :

:

First. That the government should, by all means, recover back from the banks which now exercise it, the issue power, substituting the bank circulation by a national issue; and this being effected, gradually reduce the sum of the issues until there be established, a little more or less, a parity of value between such issues and metal; that the government should, by no means, concern itself about the course of the foreign exchange, but should abstain from all interference therewith, this being a purely commercial question, once that the currency be brought within its normal limits by means of a gradual and gentle diminution of its volume.

Secondly. If it be not practicable for the government to recover back the issue power from the banks now exercising it, then it should oblige those banks to make such a gradual and gentle contraction of their circulation and credits upon their books, as to re-establish the par between their circulation and metal; and this being accomplished, with the greatest ease imaginable, the banks can recommence specie payment. Although a very large number of the commercial community entertain a different opinion, we are perfectly satisfied that, with loyalty and a sincere desire to co-operate with the government, on the part of the banks, there will not be the slightest inconvenience, nor should it cause the least shock to trade, that the necessary contraction to re-establish the par between the bank issues and metal be effected within the term of six months.

We have remarked, that once re-established a parity between the bank issues and metal, a return to specie payments would be made without difficulty, and we found this assertion upon the assurance that, this parity between the bank issues and metal being re-established, foreign exchange would rise to par, and as soon as this shall occur, all motive for the exportation of metal will disappear, and the banks would incur no risk, having even a small reserve of metal, in offering to give that, which nobody would desire to receive.

We are done. And if our crude ideas can be of any value to the country with which are linked all our interests, present and future, our wishes will be fully gratified, and our object in offering them accomplished.

Art. IV. THE EFFECTS OF USURY ON PRICES AND WAGES.

THIS seems the proper place, in treating of the effects of usury on prices, to point out the distinction which exists between usury and credit. Although I have hitherto spoken indiscriminately of the usury and credit systems, yet there is in reality an essential difference between the two things. Credit is the entrusting another with goods or property without payment, and is always associated, in its practical operation, with debt. Usury refers, strictly speaking, to increase only. It is the hire of the loan of money, the rent of land, the increased price put upon goods given in credit. In this light it is invariably presented to us in Scripture. We are all thus far familiar with the existence of usury. In respect that the credit system has established two prices-a price or discount for cash, and an enhanced price on time-we may, without being far astray, speak of that system as one of usury. I will not attempt to define that line which separates traffic from charity, or to lay down for any the proper course of conduct to be pursued in regard to those whose circumstances prevent them from obtaining the necessaries or comforts of life, or who have nothing to give in exchange for those commodities. That there is no charity in business is a truthful sentiment originating in the well known principle of mutual compensation in trade. Some will consider every calamity a fitting occasion of speculation, even as others will consider every case of distress or want a fitting subject of trade. All trade, it must be admitted, is carried on for the supply of human wants, and we must, to all intents and purposes, class the man who is compelled to borrow money with the man who is compelled to borrow food or raiment. The Jews were (I suppose on account of the hardness of their hearts) permitted to take the pledge, but the curse of God rested upon the habitation of the man who withheld it. I am aware that there is a sort of convenient morality abroad, which foists upon the broad shoulders of the Jewish nation, many of the stricter requirements of the divine law. It would subserve no good purpose to condescend upon particular cases. Every man is equally reprehensible, for it fosters speculation, encourages idleness, robs labor of a share of its earnings, creates poverty, tempts young men on the threshold of life to begin business on others' means, disarranges the healthy division of labor, imposes a money despotism, and ministers to that inordinate lust for gold which is never satisfied. If there were any doubts existing in our minds as to the application of the anti-usury Mosaic laws, they ought to be set at rest for ever by the promulgation of the apostolic decree, "Owe no man anything," an injunction which has reference not so much to those who are involved in debt as to those who are clear of debt, not to a part or community only, but to the whole Christian church, and which has also

For the proper signification of this word, see last year's Magazine, page 573,

reference, by implication, to the lender as well as the borrower, to the seller as well as the buyer. The apostle has evidently had reference, in this injunction, to that system of credit which has been associated with usury from the earliest ages, and of the manifold evils of which he could not be ignorant. Although there may be credit without usury, there can be no usury without credit.

There is no material difference, as bearing upon the principal objects of our inquiry, between the lending of money on interest and the giving of goods on credit. In commerce, the giving of goods on credit is the giving of goods on usury. As a general thing, no man can afford to give his goods on time on the same terms as for immediate cash. The great bulk of transactions are now undertaken on credit. An increased price is therefore put upon the goods when given on time, and this is the usury of goods. This usury becomes a "charge on merchandise" just the same as cartage, freight, or any other item of expense. This distinction, as expressed by "discount for cash," is familiar to every one. The present credit system, so far as credit is exercised, and so far as that credit operates in usury or increase of price, is identical with the renting of land on hire and the lending of money on interest. There is no difference-I speak now merely with reference to effects-between a banker giving a thousand dollars on interest for three months, and a merchant giving a thousand dollars' worth of goods on a credit of three months. They give property of equal value in both cases; the right of propriety rests equally with the merchant as with the banker; the buyer gives, at the three months end, not the same goods, but an equivalent value; the borrower of the money gives, at the maturity of his note, not the same money, but an equivalent value. Each party gives but a promise to pay. The one employs another's money; the other employs another's goods. The only distinction I perceive is that the merchant is paid in money, whilst the banker is paid in kind, a distinction of little moment. The giving of money on usury is not, therefore, the selling of money; the giving of goods on credit, if it may be called the selling of goods, introduces a principles, if not subversive of, at least prejudicial to, the principles of barter upon which all commercial transactions are properly founded. When goods are paid for and settled, then, and not till then, are they virtually bought and sold. I do not now speak particularly of the so-called payment by means of spurious paper money. The passage of such a medium is in every respect identical with the passage of counterfeit gold or silver, and no man will be so foolish as to say he has

men.

⚫ Modern expositors have set aside the force of this injunction, by making it refer to indebted You may get into debt, they say, but get out of it again as quickly as possible. It is like telling the thief that he is permitted to steal, but that he must return the property without any unnecessary delay. This piece of Jesuitism has borne its fruit. Everywhere we see manses, schools, and the very house of God built upon credit. And the Christian community has too often witnessed the Church herself reduced to the necessity of going a-begging for means to liquidate her debts. If this is not conformity to the world, I do not know what is. Ought not the Church to show unto her people the more excellent way, instead of thus sin fully indulging in a vice strictly forbidden by that book, the tenor of whose precepts she professes to teach? The Church, like the world, must go into undertakings beyond the means which God has given her, and ever and anon her adherents are startled with piteous appeals to relieve her of indebtedness to the extent of fifty, sixty, or even a hundred thousand pounds. The Church has, no doubt, in these acts exhibited but another illustration of the wonderful ingenuity with which the human mind will impose upon itself. Still, let it be understood, I speak, in these articles, only of the credit system in its broad and general features and as associated, practically, with usury or increase, (and which has become so very generally a cloak for the sin of the Church in incurring debt, heedlessly and needlessly.) and not of those rare and exceptional cases in which credit may be lawfully asked, such as the breaking down of your wagon or the casting of your horse's shoe.

been paid when he takes base coin. The lending of money on interest and the giving of goods on credit are identical in so far as they each create a debt. Let the terms of human contracts be what they may, it is plain that there can be no effectual sale which does not virtually transfer the ownership of the goods. With regard both to the case of money and goods, a charge is of necessity made for the use and risk, and this charge is known as interest or usury.

I do not allege but that a certain species of barter or interchange is effected and carried on by means of the credit system. Exchange is carried on, and that most expeditiously, too. But, at what a cost is this "facility" obtained! We have been told that the credit system is that by which the barter or exchanges of one set of men are placed over again st those of another set, or by which the debts and credits of one nation are extinguished by the debts and credits of another. These are just the ideas of the socialist introduced into trade. If mankind were resolved into one vast trading partnership or company, such ideas might perhaps hold; but, as nature has constituted us not only with varied passions and interests, but also with distinct, definite, and separate rights, all such attempts to reduce mankind into these degrading positions must end in failure, as they have always done. The course of events have but too plainly proved to us the nature of this social credit system. It is a fatal step to attempt to establish a sort of universal moneyed partnership in order to extinguish the debts of society with the credits of society. A thousand influences are daily at work to falsify the calculations, disarrange the plans, and prejudice the adjustments of such a finely balanced. scheme. The complications of it are such that the failure of a single individual largely involved may disarrange the whole. Its only basis is a confidence as capricious as it is vain. Let the thousands of millions of dollars lost under it-lost not through its abuse but use-let the enormous national, municipal, public, and private debts, declare whether or not it is a system which extinguishes the debts of society by means of its credits. Let the blighted hopes and blasted homes of millions of honest men declare the nature of this credit system. The calculations of insurance companies as to the average duration of human life in particular districts or countries may be pretty generally correct. When applied to individual cases, these calculations are in the highest degree presumptuous and uncertain. The foolish anticipations of the credit system are of exactly the same nature. It is indispensable, in matters of business, that every man should stand upon his own feet; and trade will flourish better when there is less sham and more reality, fewer promises and more performances.

Let us distinguish three different parties by the letters A, B, and C. A and C are engaged in trading with each other-that is, the one exchanges the surplus production of his commodities for the surplus productions of the commodities of the other. It is admitted, even by the advocates of the credit system, that all trade is founded on the recognition of this simple principle of barter. A has commodities which he does not require-C has commodities which he does not require. The surplus commodities of A are just the very thing which C requires-the surplus commodities of C are just suited for the wants of A. An exchange therefore takes place between the two parties-that is, A sells a certain amount of goods to C, and C sells an equivalent value of goods to A, an operation

which, whilst relieving each of a superfluity, provides each with things indispensable. The only result of the introduction of a medium of exchange-like goods, for example-between two parties is that the values of these commodities are expressed in money terms. It makes no essential difference if either A or C should have in possession more or less metallic money. On the principles above stated, they must each have given a proportionate amount of value in commodities for this money. Let us now suppose that B interposes between A and C as a middleman or banker He ceases from the work of production, of laboring for himself, and says, "If you, A and C, will support me by your labors, I will serve you mutually in the way of "facilitating" your exchanges. Now, if it be true that all barter or trade is founded on the simple priciples of one party exchanging his surplus commodities for the surplus commolities of another, what possible purpose of utility can B subserve in this self-imposed middle station? It cannot possibly be shown that B is of any service there, for the trade, barter, or exchange which we have set forth, are independent of any such aid. In the circumstances now stated it needs no argument to show that B is a useless burden on the two par-. ties A and C-a burden in regard to the labor necessary to sustain him, and a burden, eventually, on the prices of the commodities raised by A and C. I shall not be assuming any uncommon case, if I suppose that B comes between the parties-between the buyer and seller-armed with only a very large ledger and a very large stock of credit and confidence. With these three precious commodities he is prepared to go into business on a great scale. But B finds that a cash trade affords for him but a barren prospect, so he labors assiduously to subvert the simple principles of barter as laid down by all the economists. Instead of cash he must substitute credit. Debt must be created, or his business will starve him out. He is not satisfied with the facilities of payment he already affor is to A and C. His position as a mere agent is not half dignified enough. He must have trade built upon the bubble of credit, rather than the foundation of cash, and labors to impress them with the necessity and advantage of buying on credit and selling on credit. He denounces the efforts of any one bold enough to lift his voice in favor of the cash system as the beretical notions of a heated and visionary imagination. He sets himself up as possessed of unlimited wealth, and tells these simple traders that, like the magician of old, he has a book, a mere inscription in which turns everything into gold; that he has, in fact, discovered the philosopher's stone. It will never do if A and C persist in buying and selling for cash, in giving value for value, in bartering commodities for commodities. B therefore labors to substitute debt for cash, promises to pay for payment. It is essential, in every respect, that either A or C should fall behind-that some misfortune or calamity should overtake one or other of them which, whilst leaving some sort of substantial security, should destroy the present means of livelihood, or that one or other of them should aspire to something beyond his means. It is quite an indifferent matter to B how many penniless distributors step in between A and C. If collateral security of any kind can be given, he is ready to accommodate each and all. He rightly judges that the more freq ent the inscriptions in his magic book, the better he will fare, and, in his personal aggrandizment, he wisely sinks the public good, well knowing that that public will not trouble itself to inquire too discrimina