The reflector. (Milledgeville, Ga.) 1817-1819, June 16, 1818, Image 1
THE REFLECTOR.
MILLEDGEVILLE, G. TUESDAY, JUNE 16, m«.
BANKING.
om niles’ weekly register.
E PAPER SYSTEM—NO. Ill
EFFECTS ON THE FARMERS.
bo cultivators of the earth consti-
Aniericaii nation. The products of
are its only real and substantial
,'licy furnish the food of man—they
he merchant the staples of his trade
manufacturer the materials of his
ship—to the laborer his most whole*
d virtuous occupation—and to the
e his employment and his bread.—
ure is the only lasting source of na-
altli, because it is independent of
itical changes that turn the course
erce and manufactures into new
; and its history never presents such
of short lived grandeur, founded by
t decay, as are exhibited by Tyre,
Genoa, and many other states. An
ral people belong exclusively to
country ; and are in a great de-
of the reach of those regulations,
lie pleasure of governments, ovei
y have no control ; which exercise
e influence on the well being of mer-
and render those dependant on coin-
Imost as much the subjects of every
tc as of their own. Agriculture is.
phatically, the employment becoming
ican people, since*it introduces none
tremendous inequalities of wealth
erty, that create the materials of ty-
■nobles and beggars—oppressors and
Its gains are moderate and sure ; it
s by salutary degrees, and by the ex-
f industry and frugality, the two
illars o A virtuous state. Its invio
leration is, in short, to produce a
id system of equality—equally re
frain the splendid, corrupting prodi
f unbounded wealth, and the debasing
edness of pinching poverty. It was
ture that changed the earth from a
less to a garden, and jnan from a
i) a civilized being. Its virtuous la-
lile they mellowed the soil, humani-
manners, and turned him from war
ider,hitherto his only occupations,to
;e social feelings, tp cherish social
and that sacred good fellow ship
irises from the influence of neighhor-
the interchange of friendly offices, and
le of mutual depcndunco.
e, then, the face of the country is the
rror in which to look for the expres-
national happiness. The situation
farmer is my criterion of national
ity. Agricultural plenty makes n
•ich and happy—commercial plenty,
our’s, is the forerunner of national
ition—for a great importation of
if they are not paid for by an exchange
iroducts of the land, make a nation of
and a nation of debtors is a nation
Let brokers and speculators per-
he farmer preserves his sturdy inde-
e ; for, so long as that is preserved,
r honest classes of the community
decay ; unless, as in the present state
s, the country has been bloated, by
1 means, into a precocious expansion
innot be either salutary or lasting,
us free ourselves from the wretched
cm, and, though we mny not see so
-start brokers rolling in wealth, oi
suffering laborers, who are swal-
by the monopoly of speculators—or
wretched paupers, reduced from
iehes to real beggary—yet, sir, we
what is much better : we shall see
stead, a wholesome, widely diffused
nee among all classes, equally re-
om the extremes of splendor and
on which the republican institutions
ountry may rest iii security.
:g then, to the welfare of theTarmer
st, and the only, foundation of na-
osperity, whenever I wool detest the
r of any system, financial or com.
I always study its effects on the
interest; and if I find them injurious
do not hesitate to pronounce the sys-
iso and impolitic. The interests of
vatorsof the land can never be sacri
hose of any other class, or classes of
iiuity, without the injury recoiling
ir own heads. As well might we at-
deepen a stream of water by drying
rce—or to purify it by pullut.ug the
from whence it Issues. Let me now
0 enquire into the efficiency of the
tern, testing it by these plain pfinci-
h I defy the most logical broker, or
1 speculator to overthrow, however
scurc them, by quoting the jargon
1 economists, originally hired to
he national debt of England,
o boasted benefits which the far-
baid to derive from the paper-rag
re the facility of procuring money,
banks, wherewith to improve their
d the increased price of the land
of its produce. As to the first, sir,
I am one of those desperate unbelievers, who
doubt whether the virtue, the happiness, or
the prosperity of the people, are enhanced by
the facility of running in debt. I believe that
the only true and lasting basis of honorable,
and salutary independence, to the laboring
classes, is industry and frugality ; fur I know
by experience, that a dependanre on any o-
ther prop is sure to be followed by idleness,
debauchery, exti avagaiirc and ruin. Whcm -
verw state of public feeling is produced,
where men are not ashamed of being in debt,
the mind loses its proper sense ol manly inde
pendence, and whenever the salutary obsta
cles of borrowing money are removed, and
men are invited to be become debtors by the
facility of borrowing money, the axe is laid
to the root of national industry, which is the
foundation of national virtue and prosperity.
In no well organized state of society ought
the generality of men to become borrowers ;
and in no <"luss of any community can bor
rowing become general, without ultimately
ending in its ruin. A mart may sometimes be
placed in a situation where a loan will be
greatly advantageous ; but he who bottoms
his prosperity on money belonging to others,
and whi h may he reclaimed at any time, is
worse ill.m the fool who built his house on a ;
foundation of sand.
There was a time—I speak in the melan
choly past tense when recurring to tho days
of agricultural prosperity—There was a time
when it was disgraceful in a farmer to borrow
money, and his respectability was seriously
injured by becoming a dependant on banks,
l hese honest people had a just and instinc
tive abhorrence to those institutions, and,
without exactly reasoning on the subject, they
arrived at just conclusions. They sawthat
the art of becoming rich without either capi
tal or industry—the power of creating wealth
from rags—must in the end, inevitably prove
highly injurious to every man possessed of
real property. It was plain, that if men could
grow rich by such means, the value of indus
try and land must continue to diminish insen
sibly, because it is impossible (o give a ficti
tious value to any imaginary and worthless
commodity, without diminishing in ’he like
proportion, the value of what is real. The
firmer had earned dearly,-the money with
which he purchased his land ; and when he
saw the facility with which land could he ac
quired without tabor, or silver, or geld, la
could not. fail to he struck with the conviction
of the truth. He saw and felt that the sys
tem of rags must either be destroyed or that
lie must become an accomplice or «v victim.
These truths are every day coming home to
the farmers, in proportion as the number of
banks, without capital, is increased ; and we
now every day see them, either selling their
lands to invest the proceeds in banks, or to
flee to some sequestered region where none
are to bo found—or we see them driven to sa
crifice their inheritance to pay their dis
counts.
Of all men living, the American farmer
had the least occasion to borrow money. If
he was horn to tlic inheritance of a farm, that
farm would stippot t him as it did his father
before him—if like him, he was frugal and
industrious. If he had no land of his own lie
could get it in his neighborhood ; he could
buy it without money, and pay for it by his
industry. The payments were always so pro
portioned, as to give him a fair chance of
meeting them from the profits of his lahd.
and, being aware of this, he lost every other
dependence but that of becoming a man—a
■lcpcndance on his own exertions. The differ
ent periods of payment were distant and cer
tain, and he knew the precise time that they
would he demanded. He gave no security,
but a mortgage on his farm, and he allowed
no extraordinary premium on the score of
the uncertainty of being able to pay. He could
therefore pursue the even tenor of his indus
try, without being drawn off every 60 days,
to raise the ways and means for paying th,-
sixty days’ bank accomodations; ami sel
dom if ever did it happen, that he was forc
ed, as now a-days, to sacrifice his farm and
his produce at half price, to some hungry
bank director, to pay a loan unexpectedly
demanded on some frivolous pretence, if,
in short, he was prudent and industrious—
and without these, even bank loans will not
enrich tile farmer—he soon became indepen
dent ; for he did not rely on the conscience
of brokers, or the good will of the petty di
rectors of a petty village bank, thirsting for
his land, because they were poor, and care
less of the means of acquiring it—because
they were unprincipled.
Or if, sir, he found it difficult to procure a
farm on these terms in his more immediate
neighborhood, the fertile regions of the w6st
and south, where land was cheap, and labor
the source of wealth, were open to his enter
prise and industry. Here ho was certain of
independence, and sure to grow moderately
rich, as rapidly as it is salutary for man to
become so. He required not a shilling to buy
a farm, for his labor was sure to make it his
own, and his landlord knew his interest too I
well not to render the situation ofhis settlers!
as easy as possible. There was a contest for
settlers, and not for lauds on which to settle.
1 assert, therefore, that the farmers wanted
no greater facilities in raising money than
they possessed before the erection of a sin
gle bank ; and I appeal to ilieir present de-
(lining state, that the facilities they now pos
sess, in "iHiseqd^nce of the multiplication of
. Iicse mibchievouS and liYiprincipled institu
tions, are the sources of their speedy and in-
‘ vitahie t! ay. Such however, was the sit
uation of the agricultural interest, previous
lo the grand conspiracy of desperate specula
tors, against the laboring classes, and hold-
decs of real property, in the United States.
In this happy state of self dependence they
lived, increased and flourished, until the
grand discovery which lias immortalized the
age, and will in the end make its fate an ex
ample, and a warning to posterity. I mean
the discovery of the magnum bonum of brok
ers, beggars and speculators, the great chym-
ical desideratum which hnfllcd the science of
former ages, and eluded the researches of
wicked wights, where ingenuity was suppos
ed tq be quickened by unholy leagues with
the prince of darkness—I mean, the true anil
genuine philosopher’s stone, heretofore believ
ed to reside in metals, hut now found to con
sist in a mere transmutation of rags. We
know not the name of the chosen genius win.
first made this fortunate discovery, and cal
culated so justly on the credulity of mankind.
Rut as necessity is said to be the mother of
invention, it is probable (he world is indebt
ed fur this most valuable secret, to some
beggarly itinerant, who having exhausted
all methods of swindling by retail, luckily
at last hit upon tins admirable expedient for
carrying on business by wholesale.
Since then the decline of the landed inte
rest has been exactly in proportion to the in
crease of the means of trading, speculating,
monopolizing, and lending by the agency of
paper banks—to the increase of the bank di
vidends, and the rate of depreciation in the
paper currency. The temptation of nine or
10 per cent, per ann. obtained by the invest
mg money in (lie banks, no matter whether
gained honestly or not, has caused all the
ik-ating capital of the country to be embark
ed in hunks, which arc now become tho nnlv
loiih rs ui money, through discounts or thro’,
the channel of usurers', broke-rs, and bank
directors. To the hanks then the farmer is
courteously incited to borrow money, whe
ther he wants it or not. There is no difficul
ty in his getting loans to the amount of near
ly tho value ofhis farm. Nay, it appears by
a report of a committee of the assembly of
tin-state oi New York, that he is actually
coaxed, seduced, into burrowing, by the
cunning jackalis of the country banks. That
this seduction is carried on, on a most exten
sive scale, my own experience has demon
strated. It is proved by the iiinumcrahh
suits brought by the banks at every town a-
gainst the holders of real property;—it i-
proved by the te.-:liouiny of thousands of far
mers, forced into tue sacrifice of their lands,
to pay bank discounts ; and it is unanswera
bly proved, by the notorious fact, that tin
hanks arc gradually > quiring possession of
a great portion of the real property in their
respective neighborhoods. No wonder, sir—
people who can manufacture rags at pleasure,
which they never mean to redeem, and pass
them off for money, A get real property pled
ged, for the payment of debts thus incurred,
must and ui!l, at no distant period, acquire
virtual possession of nil the real property of
the country.
I, sir, live in a district where there arc
sixteen or seventeen banks and corporations
issuing paper money, within 10 miles square.
Its population may. he, SO,000, and it.$ trade
may amount to three, four or five millions
annually. One would be puzzled to guess
where all these banks find employment for
their capital,—it really makes me sttlilewhen
1 apply the word capital to modern paper
banks !—the riddle is easily read—they lend
them out on chc security of lots bought, and
houses built with rags borrowed of these
banks, to whom almost every house and foot
of land is tributary, and every man a slave.
1 have estimated on correct general data—
that all the property, real and personal, land
and live stock, two legged and four legged
tfiiimals inclusive, if it were sold to-morrow,
would not redeem the paper issued by these
precious monied institutions. By a late ex
position of the affairs of these banks, made to
the secretary of the treasury .and inadvertant
ly published, it appears that the amount of
specie then in their vaults, was somewhere a-
bout one fifteenth the amount of their debts
to the. public !
What a glorious* state-of things ! and what
a consoling reflection it is, to know that this
state of things is not peculiar to the flourish
ing district,I have the good fortune to inha
bit, but is widely diffused, and every day be
coming more extensive and diversified. South
of the Connecticut river, we seldom find a
state legislature, meeting without increasing
these blessings ; and the first embryo act of
! legislation in the new states, is tho creation
of a litter of banks, to enable a knot of spe
culators to monopolize the land, and hold it
at a fictitious value, which impose on the
land holder an idle and erroneous persua
sion, thatAic has all at once grown rich.—
Thus, instead of the country prospering by
its pure and genuine sources of prosperity,
these are in fact destroyed by the fictitious
substitutes, that possess no other attribute
of reality, than the means of scattering ru
in around them.
All suffer more or less by this substitution
of idea), lor real wealth, but none so vitally
as the gVcat landed interest, which is tho
hack bone of the country. The means which
formerly sufficed to make the farmer inde
pendent, arc now no longer so, because the
value of money is decreased, in a much
greater ratio, than the rise in the price ofhis
land and its produce ; and above all, be-
i ause, a mode of living extravagant beyond
all former example, is introduced, every
where in this country, by the brokers, hank
directors, and speculators, to which the re-
tenues and the gains of every other class of
people are entirely inadeq late. The natu
ral, and therefore the inevitable consequence
of this state of things, may lie readily an*i-
i ipated. Either the, farmer is tempted to
sell his land and invest it in some neighbor
ing bank, lured by the irresistible argument
of nine or ten per cent, or he : s tempted to
borrow money which he does not w ioi, to
speculate, and grow rich of a sudden, like
his neighbor the bank director. If I. t.x.’s
the first course—the stock of capital in •.••sl
ed in the cultivation of the land, is dim iti
ed in proporti ,n t6 the recruits thus ml
from honest and permanen' in-1; pcudi-ncc, to
take tiie chances of broking and spcnn.r.lio'i,
and deposit their real rich 's in »tie same fate
with the ideal wealth of penuvless ..((ventu
rers. From a useful citizen adding i vy
day to the wealth ofhis country and the
happiness of his fellow beings, he sinks into
a useless drone, nay, a mischievous tempi-a*
—an animal who preys on tho unsuspecting,
and grows rich on the distresses of his
neighbors.
If, on the contrary, the farmer is tempted,
and coaxed to accept of a discount, and this
is done continually by the country and vil
lage hanks, which are of course ever on tiie
alert to procure, the security of real property
for their rags—what then is the rominoii ef
fect of such imprudence ? He obtains a tem
porary accommodation for sixty days, which
cannot be useful to him in the slow progress
of agricultural economy, and which tiie as
surance of his friend, the bank director, that
his note will be renewed forever if he wishes
it, renders him careless in repaying. Nine
times out of ten l e is not read/ to pay (lie.
note—■.vlii- h is renewed a decent number of
times, until the favorable period for it fusing
all further accommodation arrives, Bruks
never want a decent excuse for this—but the
real reason generally is, that s line h.inirv
bank director, had cast tim eyes of longing
on ’he good man's farm, which in pro<\ ss of
time, is sold at public vendue, am 1 .'ucriticed
fur half or otic third i its value,—because
the little country bank, having every body
in debt, has only to draw in its discc its
suddenly, to make money s.i scarce in tour
neighborhood, that then is n > competition of
purchasers, instances of this kind o> car so
frequently ir. tin. vicinity of ibis'* pe>.*.» o-
principlcd establishments, that the p.of
land, so far fro.a being • .•c, • nbiine in
the country, has srsta.ned u raol .i-pr.cia-
iicn, on account of the n her of farms,
that are. every where sacrificed in the man
ner I have stated. There are. more f ,r..is
for sale ; than fair and honest purchasers to
buy them ; and though we find land nomi
nally at a great price, we do not anil reauy
purchasers at all for it, except bans di-. c-
tors and speculators, w ho having a mam.fac
tory of money of their own, don’t mind a
few thousands one way or other To th se
who never mean to redeem their rags, the e-
mission of a few more or less is < f no earthly
consequence. Hence it is that the most
carelessly generous people in the world, arc
for the most part those that never pay their
debts. It is not they wbo give the money—
but the laborious tradesman who is never
paid for his work—and the honest farmer
who is stinted in the enjoyment of his well
earned independence, to supply the unprin
cipled prodigality of gamhl'rs and spend
thrifts. It is thus that laborers dwindle into
paupers, and land pass away for paper mo
ney—for an ideal equivalent—iinpuchntly
professing to be what it is not; for a mire
promise, that will not, and as I shall hereaf
ter prove, cannot, aiid is not meant to he ful
filled. It is thus that the agriculturalist,
the proprietor of real estate, is impoverished
by the diversion of the capital of the country,
from the land to the bank ; from the bank to
the broker’s shop—to be dealt out at usuri
ous interests. It is this way that the r ,tl
property is swallowed up by an idei I mon
ster, having neither flesh, or substance, or
soul, but voracious beyond the fabled appe
tites of either giant or ogre.