A Speech on the Principles of Finance

by Victoria C. Woodhull

Incidentally in this connection, because it has an indirect bearing upon the question under consideration, I wish to call attention to a mistake that has been productive of more financial ills and consequent injustice to a large proportion of the people, who are the wealth producers, than any other single cause, and that is the fundamental error of making land, wealth, which it is no more entitled to be, scientifically, than gold is to be called money. Wealth is that which is produced. Land exists. All improvements made upon land are wealth; but the land proper, never.

In this almost fatal mistake—almost fatal to the humanitarian interests of the so-called common people—which is fundamental in its nature, is found the basis upon which rest the vast disparities in the distributions of wealth, and which gives to certain favored individuals the means of realizing vast fortunes without ever resorting to the production of wealth, or of even accumulating it by trafficking in the different kinds of wealth.

There are numerous examples of this manner of becoming possessed of riches. People acquire title to lands which, by favorable location, come into great demand and consequently rise in value from one dollar per acre to hundreds of thousands of dollars per acre. By what principle of equity and right should any person be entitled to such vast increases in capital invested in land, when it is entirely attributable to the movements of the community which produce it, and in no single particular to the individual? To be so entitled is for the individual to possess advantages over others to which no just communal government should for a moment consent—is to have the right to appropriate to self the results of labor which belong in common to all the people. Such results are against all principles of equity and justice, and is one of the greatest, if not the greatest error of the present, regarding the equities of property, and is the foundation and prophecy of all other kinds of monopoly.

It occurs to me that an objection may be raised to my argument classing gold as wealth, and defining wealth to be that which can be made use of to minister to life, comfort and happiness; or perhaps to the distinction of permanent and transitory wealth. Gold, as permanent wealth, can only minister to man through its exchange for other valuables of which direct use can be made. It may be said that in that sense gold can legitimately be money.

But if there are objectors to this argument, I beg to call their attention to the conclusive fact that gold can never be representative of all other kinds of wealth. It is just as impossible that it should be, as it is that a bridge one hundred feet in length should span a river five hundred feet in width. It must further be remembered that the uses for which money is required demand an invention which can be made use of for no other purpose whatever, and that money is the name of an invention demanded and made for the purpose of facilitating exchanges—for making them easy, convenient and adaptable to all conditions of all persons.

Every attempt ever made to compel gold to answer the demands of money has been a disastrous failure. So long as a country enjoys continuous prosperity under a gold standard of value, it is all well enough. The people make use of an expanded volume of currency in the full faith that prosperity will continue and everything be smooth and right.

But anon a change comes, the nation is precipitated into conditions which require more than its accumulations of gold to meet. That being exhausted, it is inevitable that representation be resorted to. The wealth in the form of gold not being adequate, and other wealth not having been used or accepted as money, paper representatives of it are the only resort. So it appears that when an emergency arises the people are involuntarily pressed to the use of the principle of representation, which is the only scientific thing that can be called money. So that while a paper representative of wealth is, with everything else, a product of labor, it is more than that; it is the embodiment and application of a principle, which other products of labor are not; and all principles are fundamental; are the basis of all permanent and all purely scientific things and truths, while wealth is the realized product of the outworking of principles, directed and appropriated by man for his use and convenience.

The direct inquiry can now be made as to what will best perform what the people require of money; and money is that which can be used to represent real values without an absolute transfer of such values. The basis of all value of this country is our present accumulated real wealth and our capacity to increase it, and this accumulation and the prospective increase may be wholly represented by money and the nation never become bankrupt.

A person may possess wealth to the amount of ten thousand dollars upon which he may issue his representatives of value or promises to pay that value. These representatives of value would circulate among those who believe in the capacity and intention of the utterer to give up to them, when demanded, that which they represent. Everybody by his individual right has the authority to issue such representatives of value, and no government has any right to prohibit their circulation; because the people, as individuals, have the right to take or refuse them. The issue of bank notes is upon the same principle, and so long as the government does not in substance indorse these issues, the people have the perfect right to deal in them—to receive and deliver them.

But there is an insuperable objection—one which cannot be overcome by any governmental requirements—to these representatives being called the real money of the people, since circumstances over which neither their utterers nor receivers can have any control may render them valueless—may make it impossible for those who uttered them to redeem them—and their holders find themselves with bits of paper representing nothing; but for which they parted with real value.