Part 16 (1/2)
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 princ.i.p.al, 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 the burden 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 chancellor of 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 const.i.tutional 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 inst.i.tutions. 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 a.s.sociation with the republic in 1171, and dominated it, sapping its life, and a.s.suming 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 a.s.sociated in the responsible duties. After this, and about the time of the a.s.sociation 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 pa.s.sed there were no steps taken toward a return, but the authority and power was more and more centralized. The ruling cla.s.s was, in a hundred years, limited to those families enrolled in the ”Golden Book.” In another hundred years the government 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 a.s.sistance, giving them special privileges to secure a permanent loan. They were to loan the crown 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 a.s.sociated 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 law was 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 the world, 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 United States. 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 p.r.o.nounced in their opposition.
”The banking system concentrates and places the power in the hands of those who control it.