Wealth is the product of labour; is anything that labour produces or gathers. But the functions of money are representative wholly. Money takes the place of wealth for the time—stands for it. Here is the fallacy of a specie basis for money: specie is wealth, and can be made a basis for the issue of money, but the error consists in making a distinction against other kinds of wealth which would be equally as good. Anything that has value may properly be made a basis for the issue of a currency.
If we trace the origin of money, all this will be made plain. At the basis of all questions relating to wealth and money, lie the elements—the land, the water, the air—and these are the free gifts of God to man. None have the right to dispossess others of their natural inheritance in these elements. The right to life carries along with it the right to the use of so much of each of these elements as is necessary to support it. No one has a natural right to more than this. Hence, men have no more right to seize upon the land and deprive others of its use, or part with it to others for a consideration, than they have to bottle the air for the same purpose. There can be no ownership of the elements; no ownership of the land any more than of the air or water. Pretended ownership is another name for a usurpation. But the elements, unused, are valueless. Labour applied to them yields results, and these are valuable, consequently wealth; the net results after subsisting the people are the accumulated wealth of the world, and there is no other wealth.
MONEY THE ROOT OF ALL EVIL.
If every person were to produce all the different things he needs or wants, there would be no use for money, and the people would escape the curses that follow in its trail, but experience taught labourers that it was an economy for each to labour in some special way, and to exchange his surplus products for those of others labouring in different ways. Besides, the different climates produce different commodities, of each of which all other climates require a share. Out of these facts came agencies for effecting exchanges—money, the merchant and commerce. In their origin and normal functions they are the agents, the servants of labour; but when from exchanging the products of labour they grew into speculating in these products, then they assumed abnormal functions, and became the masters of labour. It must be seen, therefore, that the only legitimate method by which wealth can increase, is by adding to itself the net results of labour; indeed that is the only way in which it can increase. It must also be clear that these results belong in toto to their producers, since, if nothing were exchanged save equivalents, these results could never pass from the hands of their producers. But by permitting the representatives of wealth—money—to have the power to increase, the makers of money have been able to filch all the net earnings from labour, and as a result of this, most of the accumulated wealth of the world is in the hands of the makers of money instead of in those of the makers of wealth. This may be legal, but can never be made just. Had the labourers been let alone they would have continued to produce and exchange their commodities among themselves without any trouble, and they could have always maintained themselves comfortably. But the “middlemen”—their agents—conceived, constructed and thrust upon them a vicious system of money, by which they are forced to pay tribute on everything that passes from, or is received by them, which tribute amounts to the total net products of all the industries.
THE PRIVATE BANKING SYSTEM.
The system of private or corporate banking is an example in point. Why do individuals want a gold basis upon which to issue currency? To get the privilege to levy interest on many times as much currency as they have capital invested. A bank with an actual capital of $100,000 in gold could issue $300,000 in currency, all which it could loan out together with nearly all the deposits that it could secure, which, in some instances, have been known to amount to ten times the capital. Why should not a class of men, if the people are blind enough to let them do it, speculate upon the credulity of the public through the idea that they are rendering a public service? Why should they not desire to “bank,” when by banking they can receive interest on $1,000,000, when otherwise they could collect it upon $100,000 only? The same idea is the inspiration of national banking, and of those who oppose a national currency. The banks bought, say $100,000 of United States bonds from the Government for $60,000. These bonds they deposited with the treasurer, and the people were required to pay $6000 a year interest on them, while the banks received from the Government $100,000 in national bank currency with which they were set afloat. These notes were loaned to the people, who again paid an interest on the same capital of $6000, or 20 per cent. per annum—$12,000 on $60,000; and yet the bank men have made the people think that they are offering them great accommodations. “Oh,” says the National Bank legislator, “we must get rid of these abominable, depreciated, irredeemable greenbacks, and make room for more national banknotes.” Do you know for what that legislation is bidding? He wants, if he has not already got it,—from some national bank man in his district, or else he has an interest in some bank. What is the security of national bank notes? United States bonds deposited in the Treasury. What is the security of the bonds? The public faith of the United States. What is the security of the greenbacks? The public faith of the United States. What difference in this respect, then, is there between national bank notes and greenbacks? None. Then as a currency there is this difference between the bank notes and greenbacks: If greenbacks were to take the place of the bank notes, the bank men would not get 20 per cent. interest on their capital, and the privilege of receiving and loaning the deposits of the people.
But look at it in another light. Suppose the security of the national bank notes were their own capital instead of the bonds, who would not prefer to trust the faith of the United States, rather than that of any individual in these times of Credit Mobilers, Tweed and whiskey rings? Then, again, why should individuals furnish the circulating medium of the people, when the people can furnish it themselves and save the expense? $1,000,000,000 is as small an amount of currency of all kinds as will transact the business of the country properly. Why should not the $60,000,000, which the people would have to pay the banks for interest on this, be paid to the Government for greenbacks? And more! Why should not all the interest that is now paid to individuals and banks for private loans, be paid to the Government? It is estimated that the average amount of private loans for the whole country is not less than $5,000,000,000 upon which, at even 6 per cent. interest, the people are taxed $300,000,000. Is there any valid reason why the Government should not loan this money and receive this interest? Yes, for if it did, the rich could not live in luxurious idleness, while the poor are obliged to labour twice the natural time to subsist the world.
WHY DO THE PEOPLE PAY INTEREST?
Or still again: why should the people pay any interest at all on loans from themselves? Why should not their agent—the Government—when amply secured, freely loan the people all the money that they want for use? Suppose that the farmers and the manufacturers did not have to pay interest on the money that they are compelled to have to produce their crops and goods? Don’t you see that they could compete successfully with the people of any country in the world, in the production of anything? Institute free money and there would be no necessity for a tariff for protection to keep out the cheaper goods of other nations. But on the contrary, this country would shortly be supplying other nations with the very things with which they are now supplying us and thereby crippling our manufactures and productions. Besides, all the people would be constantly employed, prices would be low, every comfort and even luxury abundant and in the reach of all, and thrift would replace stagnation everywhere. Plenty of money, plenty of work and plenty of everything that the ingenuity and strength of man can make, are the most favourable conditions for the masses; while just the reverse is true for the privileged classes. But why, since the former class outnumbers the latter, as five to one, do not the former have all things their own way in this country where the majority rule? Ask the masses this, and they can make no reply. But it is because the superior intelligence and tact of the minority enable them to concoct schemes by which, without seeming to do so, they reduce the majority to actual, though mostly unconscious servitude; making them pay, first, all the interest on the public and private debts; next, all the expenses of the national, state, county and municipal governments; and next, obtain their own support and the increase of their wealth from them. Do you think that I overstate this? I think I can make it so clear that you cannot doubt it; and if I do, will you not think differently of the toiling masses than you have thought of them heretofore? At the beginning of any year take the amount of real wealth in the hands of the non-producers. During the year the governments continue, the taxes are gathered and the expenses are paid: your debts, your expenses and all; the producers have continued to labour as usual, and at the end of the year find themselves just where they were at its beginning; but the property of the wealthy classes has increased about three per cent. for the whole country. And while the latter class has become fewer in numbers and richer individually, the former has increased in numbers and become poorer individually. Now these are the facts, and with them before them who will pretend to say that the class who have not produced anything have added to the aggregate wealth? Whence has come this increase of wealth? From the wealth producers, from the labouring classes and from no other source. Industry being the sole source of wealth, it could have come from no other source. Hence let the non-producer get his increase by whatever strategy, it comes in some channel directly from the producer. This may be done by interest, by speculation, by sharp trades, by profits; but let it be by which it may, the producer has to pay the bill. In other words, every addition that is made to the wealth of non-producers is so made at the expense of the producers, the former having so much more than they had which they did not produce, and the latter having so much less than they did produce. This is self-evident, and all the sophistical argumentation that can ever be made cannot make it otherwise. The minority may attempt to explain it away; to show that this and that are so and so; but here are the facts staring them in the face, and they will no more down than would Banquo’s ghost for the guilty Thane. There they stand, an everlasting condemnation of the rule of the minority and the servitude of the majority. Nothing can be clearer; nothing truer. And is it not a shame that it is true?