And the same Bulletin further says: That “on the owned farms there are liens[[91]] amounting to $1,085,995,960, which is 35.55 per cent of the value of the encumbered |DEBT AT 7.07 PER CENT.| farms, and this debt bears interest at the average rate of 7.07 per cent,” which is more than 7 dollars for every $100 borrowed. It is at this rate per annum that the farmer’s labor energy is drained by the wealthy creditors or by the bankers. “Each owned and encumbered farm on the average is worth $3,444.” This average, of course, includes the families far above $3,444 worth and far below it—“and” each, on the average, “is subject to a debt of $1,224.”
Hence it follows that the principle of dividogenesure, in these cases, has a yearly demand that every debtor should, on the average, pay about $86.53 worth of the results |INTEREST.| of his labor energy to his creditor. And it is a question whether even a highly effective capital worth $1,224 is really able to increase the yearly results of the debtor’s labor to the extent of $86.53—I mean an increase in his product absolutely due to the aid of the borrowed capital on which he is to pay this sum as the annual interest charge. It is rather probable that the majority of the mortgagors pay more than half of this annual percentage at the expense of their personal energy, even under the condition of the most effective use of the borrowed means. For the rate of 7.07 per cent is unconscientiously exorbitant and is generally abnormal.
As to the families owning homes, the corresponding facts are “that 27.70[[92]] per cent,” or 809,831 families, out of the 2,923,577 home-owning families, “own their |HOME FAMILIES IN DEBT.| homes with encumbrance, and 72.30 per cent,” or 2,113,746, “own them without encumbrance.” So that in every 100 home-owning families 28 are in debt and 72 are free of debt. “The debt on owned homes aggregates $1,046,953,603, or 39.77 per |DEBT AT 6.23 PER CENT.| cent of the value of the encumbered homes, and bears interest at the average rate of 6.23 per cent. An average debt of $1,293 encumbers each home, which has an average value of $3,250.” This average again includes the family homes worth far above and far below the indicated value. While the homes below this value may have greater encumbrances than the others; and it is certainly the poorer families that lose their properties first, if they attempt to get rich by means of the loans they can obtain at the rate of exorbitant per cents.
If then the average debt of these 809,831 families is $1,293 and the rate per cent for it is 6.23 per cent per annum, every one of them |AVERAGE OF INTEREST.| is, therefore, a subject to the principle of dividogenesure at the rate of $80.55 a year. It must, however, he understood that the averages indicate only the general truth, and always conceal the particular miseries and distress of many millions of the people. And I understand that many of these debtors have been in the gainful pursuits spoken of by Mayo-Smith, and hence the dividogenesure presses upon them from two or even more sides. But it is only the next census that will show us the situation these debtors are in.
Let us now speak about the cities and towns with one side of which we have become acquainted in the preceding chapter.
CITIES AND TOWNS.
“There are 420 cities and towns that have a population of 8,000 to 100,000, and in these “cities |OWNERS OF THE CITIES FOUND AMONG 414,544 FAMILIES.| and towns 64.04 per cent,” i. e., 1,120,433 “of the home families hire and 35.96 per cent,” i. e., 629,146 families “own their homes, and of the home-owning families 34.11 per cent,” i. e., 214,602 “own with encumbrance and 65.89 per cent,” i. e., 414,544 “own free of encumbrance. The liens on the owned homes are 39.55 per cent of the value of those subject to lien. Several averages show that the rate of interest is 6.29 per cent; value of each owned and encumbered home is $3,447; lien on the same is $1,363.” (See Appendix I.)
So that these debtors of the 420 towns and cities are also subject to the principle of dividogenesure at the rate of $85.73 each per every year, as long as the mortgages remain in force and are not foreclosed.
“The cities that have a population of 100,000 and over” (up to millions) “number 28, and in these cities 77.17 per cent,” i. e., |OWNERS OF THE LARGE CITIES FOUND AMONG 276,744 FAMILIES.| 1,503,911 “of the home families hire and 22.83 per cent,” i. e., 444,923 “own their homes; 37.80 per cent,” i. e., 168,179 of the latter families have encumbrance and 62.20 per cent,” i. e., 276,744 families are free of encumbrance. Averages for owned and encumbered homes are: Encumbrance, $2,337; value, $5,555; rate of interest, 5.75 per cent. Homes are encumbered for 42.07 per cent of their value.” This is the largest average encumbrance among all encumbered homes and farms.
So that every debtor in these 28 large cities (and there are 9 of them in every 100) is a subject to the principle of dividogenesure at the rate of $134.37 each in every year as long as the mortgage is in force and is not foreclosed. It is after the foreclosure that the debtor cannot even redeem his mortgaged property; he has then to remain propertyless. Let us now sum up the preceding conclusions in a tabular way, as follows: