[1888]
Seven Financial Conspiracies Which
Have Enslaved the American People.
by
Mrs. Sarah E.V. Emery.
“The great debt that capitalists will see to it is made out of the war, must be used as a measure to control the volume of money.”
— Hazzard Circular.
In memory of my sainted father,
who, foreseeing the results of our civil war, and the conditions that must arise from the corrupt financial system adopted in its early stages, gave warning to his children, entreating them ever to remember the cause of the oppressed, and ever to condemn a system of legislation calculated to reduce the laboring classes to a state of abject and hopeless servitude; in remembrance of his prophetic words, and his great love for humanity, this little volume is sacredly dedicated to the enslaved people of a dying republic.
Sarah Emery
Seven Financial Conspiracies
Preface.
Would I add another to the multiplicity of books that is flooding the country? Why not? It is only a little book I offer, but it contains truths which if understood by the masses, would tend to awaken them to the dangers which threaten our free institutions. “Eternal vigilance is the price of liberty,” and a people too indifferent or to self-satisfied to be mindful of their liberties are unworthy of such a boon.
Republics are lost because their guardians — the people — entrust them to scheming politicians. We did not profit by the experience of other Republics, but followed in their footsteps, — and in their downfall we see our pending doom. That such a doom may be averted, I believe to be the desire of every patriotic citizen; and if, in the perusal of these pages, my readers are awakened to a consciousness of impending danger, I shall feel that this labor has not been in vain. A revolution is upon us. Let us see to it that it is wrought by ballots, rather than bullets.
Sarah E.V. Emery.
Preface To Two Hundred And Twentieth Thousand Edition.
Four years ago it was with many misgivings that I presented “Seven Financial Conspiracies” to the public. Would it be received with contempt or would the masses comprehend its plain though startling truths, were problems that I felt myself unable to solve. But the rapidly increasing demand for the book has been more than a satisfactory answer to my doubtful questionings. The cordial greeting which the little messenger has received from every State and Territory in the Union is indeed gratifying, for the profound interest manifested in its teachings gives assurance that the principles of justice are deeply rooted in the hearts of the American people. Scores of times have I been assured that the startling truths presented in this little book have revolutionized entire counties.
While I am gratified that such happy results have been brought about through its teachings, I take to myself but little credit for the good that has been accomplished.
This little work is but the reflection of a wonderful luminary from the pen of one of the purest philanthropists of this age — Col. B.S. Heath. For years I was a student of his inestimable book, “Labor and Finance Revolution,” and sat a disciple at his feet until I became most thoroughly imbued with the spirit of his teachings.
To B.S. Heath this country owes a debt of gratitude that can never be paid until his teachings become so thoroughly incorporated into the life of every American citizen that he will know no duty higher than that of overthrowing the monopolistic powers that threaten the life of this nation.
Sarah E.V. Emery.
Note. — Col. Benjamin S. Heath’s book, “Labor and Finance Revolution.” can be obtained by sending $1.00 to his widow, Mrs. Louisa M, Heath, 1081 W. Monroe St., Chicago, 111.
[1888]
Seven Financial Conspiracies Which Have Enslaved the American People
by
Mrs. Sarah E.V. Emery.
Chapter One
The Civil War Preliminary to an Infamous Plot
The Earl of Chatham, England’s great statesman, once said, “Show me the laws of a country and I will show you the condition of its people.”
Starting upon this proposition, we are led to the conclusion that the laws of our country are not in accordance with the principles of justice and equality, for there is nothing in the condition of the masses that denotes prosperity, but rather a tendency to poverty and demoralization. No period of our history has been marked by such general dissatisfaction.
Wherever we turn is discontent; labor idle, or at least working on short time and low pay; mill after mill silent; furnaces cold and unproductive; tramps filling our highways; the gaunt wolf of starvation staring into desolate homes, and strikes against starvation wages — those forerunners of revolution springing up on every hand. On the other side, we see granaries bursting with the abundance with which God has fattened the land, palatial mansions rising in fabulous magnificence, and mountains of wealth — the product of half-requited labor — poured into the coffers of the idle and affluent. All over the land the wail of distress comes up from poverty-stricken homes crushing out the manhood and womanhood of human kind, blighting the beauty and buoyancy of youth, and destroying the faith of mankind in an all-wise merciful father. In a land of plenty, where the willing hand of industry has created untold wealth, why should that hand be paralyzed for want of the very wealth it has created? Why should comfortable food, clothing and homes be denied to those who have produced these things in such abundance? Reader, these are questions that must soon be answered before the tribunal of a long-suffering but much enduring people.
In view of these facts and the responsibilities that rest upon us as American citizens, I earnestly ask that you lay aside your prejudices, and with me briefly consider a few of the circumstances that have brought about this deplorable condition. It is within the memory of many of my readers when millionaires were not indigenous to American soil. But that period has passed, and today we boast more millionaires than any other country on the globe; tramps have increased in a geometrical ratio; while strikes, riots and anarchists’ trials constitute an exciting topic of conversation in all classes of society. There is no doubt but that the unequal distribution of the products of labor is one of the most fruitful sources of social and political disturbances.
Any rational person must admit that a nation’s prosperity does not lie so much in the amount of its wealth as in a just distribution of that wealth among those who have produced it.
That nation is the most prosperous whose laborers hold warranty deeds, rather than leases of their homes, and a hundred cottage homes and gardens owned by a hundred workingmen is greater evidence of national prosperity than a million of property in the hands of a single individual. The ownership of home is the great safeguard of liberty, and it is impossible for a people long to remain free who do not own their homes. History bears us out in this statement, and we trace with minuteness the connection between land monopoly and national death. God has implanted in the human heart an unquenchable thirst for knowledge and for liberty, a knowledge of that liberty which makes men free from the bondage of their physical necessities and breaks the manacles of that slavery which through all ages, the strong have imposed upon the weaker portion of mankind.
Since the day that Esau sold his birthright for a mess of pottage, crafty men have taken advantage of the physical necessities of their less artful brothers; since that day, too, hungry men have been selling the birthright of their liberty for a mess of pottage which barely enables them to eke out a miserable existence. From the days of Esau to the present time two classes of people have existed upon this earth, the one class who live by honest labor, the other who live off of honest labor. From earliest times the one class have lived by tilling the soil, raising flocks and herds, delving in mines, working in wood, brass and iron, or deriving their subsistence from the waters over which God had given them dominion. The other class consisted of roving bandits, who under chiefs or leaders subsisted by swooping down upon and plundering the honest toilers; sometimes a strong band would take possession of a rich territory, subdue its people and divide the spoils between themselves; the chief became king, the brigands nobility, and the conquered people who only the day before were happy possessors of homes, became the slaves of this robber band who ruthlessly wrenched from them their homes and the products of their toil.
Today the same two classes exist as of old, not only in Europe but in this America, which gave such glorious promise of protection to its toiling people. True, the robber chiefs of our times have not by physical force taken possession of our toilers, and the products of their labor; they did not swoop down upon these people with bayonets and bowie knives; they did not say to them we have conquered your country and you are our slaves; ah, no, the terms robber and brigand are too harsh; civilization has advanced, and these terms are obnoxious to the refined intelligence of the age. The civilized brigandage of today is ashamed of its ancestry, but its appetite for plunder is no less ravenous and daring. Modern brigandage is carried on under more euphonious titles, and new methods of robbery are employed. Instead of “robber king” and “brigand chief” we have today the money king, the coal king, the cattle king, the railroad magnate, the telegraph monopolist and the lumber baron. Instead of spoils and plunders, we have interests, dividends, revenues and rents.
The system of American government as instituted by our fathers afforded little if any opportunity for robbery and oppression. Having successfully repelled their enemies across the water their prowess was established, and the civilized world stood in awe of the young republic. Not a crowned head of Europe aspired to clip the wings of the young American eagle, and for fourscore years the proud bird soared defiantly through the American heavens, or hovered above the sacred temple of our liberties. But, alas, in an evil hour the tempter came, the guardians were betrayed, and the very sanctuary of our liberties became the charnel-house of American freedom, and the market place of American honor.
Thirty years ago the American laborer was a prospective lord. He saw within his reach a home of plenty for his family, and an old age of comfort for himself. The bright picture before him inspired industry, economy and sobriety, and the laborer was a peaceful, sober, respected citizen. The condition of the American people less than half a century ago is graphically portrayed by Chas. Dickens, who, visiting in this country in 1842, wrote from Boston to a friend in London: “There is not a man in this town nor in this State who has not a blazing fire, and meat every day for dinner, nor would a flaming sword in the air attract more attention than a beggar in the streets.” But today what is the outlook for the wage-worker of this country? He sees before him only toil, unremitting, half-requited toil; hope dies out in his bosom, despondency takes possession of his heart; and unless sustained by a strong faith and a giant will he breaks beneath the weight of oppression, seeks relief in a suicide’s grave, or worse still attempts to drown his grief in the intoxicating cup and finally drifts into the great army of inebriates.
We are now led to the question, wherefore this amazing change in the condition of the working classes of this country? There is a solution to this problem. As I have before stated the American system of government afforded little or no opportunity for robbery and oppression, but the vast plains and teeming valleys of this grand republic, with its innumerable sources of wealth, and millions of industrious population, was a coveted prize long sought by civilized brigandage. To obtain possession of this vast wealth and reduce an intelligent people to the position of slaves, was by no means an easy task. But the promptings of avarice were not to be silenced, and greed was on the alert for an opportunity to seize the coveted prize. The fatal opportunity at last presented itself. African slavery had been a source of contention from the very foundation of the republic, and its agitation finally culminated in the secession of a majority of slave holding states. The war cloud was gathering and the mutterings of dissatisfaction were portentous of a coming storm. Old men ominously shook their heads; young men stoutly declared that “the Union must be preserved”; and mothers on bended knee clasped more closely their precious boys, and prayed God that the storm cloud of war might pass. But above all the prayers, wailings and forebodings, the attentive listener could hear from Wall Street the echoes of jubilant satisfaction, and harmonious preparations for an onslaught upon the industry and prosperity of the country. Nor was Wall Street alone in this exultation over a prospective civil war; all along the line were ringing notes of exultation, even our beloved Michigan swelled the cry “to arms!” led on by that great leader who startled the entire Christian world by his infamous declaration, “That a nation is not worth a curse without blood-letting.” A declaration that must forever dishonor the name of its illustrious author.
Now do you ask why this exultation over a prospective civil war? Do you ask why the money-kings of Wall Street and the great political chieftain of Michigan were so anxious, and positively joyous, when the guns were turned upon Fort Sumter and the declaration of war sent its thrilling notes throughout the length and breadth of our land? Do you ask why their hearts became like steel, and their thirst for human gore insatiable? Why human life had lost its sacredness, and the thunderings of the war trumpet was music in their ears? Reader, do you imagine it was because of their great love for the dusky toilers in the cotton fields of Mississippi, or because the finer instincts of their nature revolted against the cruel system of African slavery? Do you suppose the story of Uncle Tom and Little Eva had touched their hearts and they had sworn vengeance upon the perpetrators of such cruelty? No, no; the money kings of Wall Street, and the great political chieftain of Michigan, were not the men whose hearts were touched with pity by the cries of distress. Their love of gain had stilled the finer instincts of their nature, and they rejoiced because they saw in the preparation for war their long-coveted opportunity for plunder. The calamity of war must bring its necessities, and through these necessities they determined to subjugate their unsuspecting brother men. To accomplish this it became necessary to obtain possession of the national finances. As blood, the circulating medium of the body, is the life of the body, so they knew that money, the circulating medium of the country, was the life of the country. Its industry, its education, its morality, in truth, its very life depended upon its medium of exchange. Controlling it, they could inflate or depress the business of the country at pleasure, they could send the warm life current through the channels of trade, dispensing peace, happiness and prosperity, or they could check its flow, and completely paralyze the industries of the country. They knew their opportunity was at hand, and the tidings of war that blanched the cheek and sent terror to the heart of the multitude was to their ears sweeter than the music of the spheres.
Scarcely had the war cloud broken were the gold and silver money of the country disappeared. True to the history of metallic money in all ages, in the hour of peril, of a country’s greatest need, her gold and silver money always takes flight. What had become of it? Why Shylock had obtained possession of it, for what purpose we shall see hereafter.
The necessities of the war required vast sums of money; but the treasury was empty, the gold and silver money of the country had fled. What was to be done? The government was in duty, bound to suppress the rebellion, to defend herself against the aggressions of her enemy. She must call out troops, clothe, feed and provide them with munitions of war. She must equip hundreds of thousands of soldiers to defend the liberties that had been entrusted to her keeping. But where should she derive means for this vast expenditure, where, in her distress, should she look for succor and support? Where, indeed, could the government look except to her own moneyed classes? Did not Wall Street rejoice in the declaration of war, and loudly protest against the secession of the slave States? Surely, Wall Street would come to the rescue, and pour out her treasure in defense of the government. So said justice, so said patriotism, but history tells us quite another story.
Neither American nor foreign capitalists would loan money to the government upon any reasonable terms. True the banks would loan their notes at 20 per cent, discount, that is, they would exchange eighty dollars of their notes for one hundred dollars in government bonds, bearing a high rate of interest, payable in gold, and backed by the government; but they had not the power to make even these notes good in the hands of the soldier. Foreign capitalists would not at that time loan us any money, for they hoped and expected to see the republic rent in twain and the star of our liberty sink in a night of anarchy and blood.
Words are inadequate to express the hopeless condition of the country, and it would be almost impossible to give credence to the demands of avarice, were not its authenticity sustained by the most reliable records. From Appleton’s Cyclopedia for 1861, page 296, we learn that the money kings of Wall Street graciously tendered loans to the government in her distress at from 24 to 36 per cent, interest — these same money kings whom today we hear quoted as those generous, patriotic capitalists. Why, sirs, the South itself was not more formidable and determined in the preservation of her slave property than were these Shylocks in their determination to wrench from the government in her distress, such usury as would have put to shame their world renowned ancestor. On the one hand appeared the bristling steel of the enemy; on the other, disguised as a friend and urging on the war, stood Shylock clutching his gold and demanding therefor a rate of interest that would drain the life blood of the nation more effectually than the bullets of a Southern foe.
But what was Shylock to do? The gold and silver of the country were in his possession, and they would not serve his purposes unless he could loan them to the government at exorbitant rates of interest. Knowing the necessities of the government these Shylocks determined to persist in their demands, for they had planned through the misfortune of the government to enrich and aggrandize themselves. This was why they rejoiced while others wept, this was why the tidings of war brought gladness to their hearts. By hoarding the gold and silver of the country they thought to compel the government to accede to their demands, and while the soldier was giving his life on the battle field they would gather to themselves riches and power.
But the great leader, Lincoln, was not to be baffled; he loved the people better than Shylock, and justice better than oppression. From the constitution he read, “Congress shall have power to declare war.” Again he read, “Congress shall have power to coin money.” Then to the world he declared that Congress would coin money, and that the government, at whose head stood the fearless Lincoln, would not submit to the infamous demands of Shylock. Following this declaration came the enactments of July 17, 1861, and February 12, 1862, authorizing the issue of $60,000,000 treasury notes, not bearing interest and payable for all debts, public and private.
These first issues of greenbacks constitute the demand notes, which, unlike all subsequent issues did not contain the exception clause, consequently they have always been at par with gold, and establish the fact, that had it not been for the exception clause on the greenback they would have always remained at par with gold. Wherever gold went these demand notes could go, even into the coffers of the bond-holders. They paid his interest, paid duties on imports, the millionaire took off his hat to them, and the banker made obeisance.
The issuance of this money at once brought relief to the country. With it the soldier was paid for his services, and his equipments furnished. Light began to break through the darkness that spread over the country, the destitution of the soldier’s family gave way to moderate comfort, and although the pall of death was frequently spread at his door, its terror was relieved by the assurance that the government had made provision for his family. With an abundance of money, not even the blight of war could check the prosperity of the country, save in those sections desolated by its immediate ravages.
Commerce, industry and education received a new impetus, and flourished as never before in the history of the country.
But Shylock was sullen and disconsolate, having failed in his scheme to rob the people through exorbitant rates of interest, he immediately entered upon another scheme of brigandage which even the adroit Lincoln seemed unable to fathom. Having hoarded the gold and silver of the country, it was through this channel, if at all, he must despoil the country. Now, since Congress had made provision to supply the country with government money, there was no longer a demand for Shylock’ s hoarded gold, and his purposes seemed thwarted. But greed neither slumbers nor sleeps, nor did Shylock rest until his bandits had an appointed rendezvous. We find that only four days after the passage of the legal tender act to supply the country with government money, a bankers’ convention was held in Washington, consisting of four delegates from New York banks, three from Philadelphia, and three from Boston. Shylock was alarmed; he saw in the legal tender act a friend to the people, that it would transfer the monopoly of the money from his hands to the control of the people, he saw in it a precedent which, if established, would forever after enable the government to relieve itself and the people without submitting to his usurious extortions. He knew, too, that the government supplied with its own money would have no occasion to call from its hiding place his hoarded gold, unless by some means he could create a market for it. This, then, was plainly the object of that notable bankers’ convention, to create a demand far Shylock’s hoarded gold.
Subsequent legislation tells us how well they succeeded.
Chapter Two
The Exception Clause
To the busy world there was nothing remarkable in the calling of a convention at Washington. But why a bankers’ convention? And why called immediately upon the passage of the legal tender act? What had been done that necessitated such a speedy gathering of the money mongers? Why, Congress had made the money of the government full legal tender for all debts, and Shylock and his gold had been ignored. The bankers must have a consultation, and have it at once. They must get control of Congress and devise some means by which the demand for their gold would become imperative. There is left no room to doubt but that the conspiracy perfected at that convention resulted in that infamous exception clause on the greenback, and was consummated by act of Congress, February 25,1862, wherein it was stipulated that the greenback should be legal tender for all debts, public and private, except duties on imports and interest on the public debt, which from that time forward should be paid in coin. Shylock rejoiced; he had accomplished his purpose, he had created a demand for his gold. Henceforth government should bow to him, and none should question his right to wield the golden scepter of money king. He had not conquered by bayonet or bowie knife, neither army nor navy had been at his command, but he had subjugated this people more effectually than ever Alexander or Napoleon had conquered.
For Congress to stipulate that only a certain article should be used in payment of certain government debts was simply to create a demand for that article. Had the act read that only white pigeons should be used in payment of interest and import duties, do you not see how a demand for white pigeons would have been created? And if one hundred men had secured a corner on the pigeon business it would have been equivalent to a corner on the government. This is precisely what Congress did for Shylock — it gave him a corner on this government.
But I am asked what harm if Congress did create a demand for Shylock’s hoarded gold? The wage worker says it did not affect me, as I was working by the day, month or year. The manufacturer says it did not affect me, as I did not use imported material. The consumer says it made no difference with me, for I did not pay duties on imports, neither did I pay interest on bonds. Well, if none of these individuals were affected by this measure I am certainly in the wrong and most humbly beg your pardon, unless an investigation reveals a different state of affairs.
First, we will see who paid the premium which Congress offered on Shylock’s gold, and secondly how much Shylock was benefited thereby. You remember that during the war our cotton and sugar crops were cut off in the south and we were obliged to import these articles from foreign countries. At one time the duty on sugar was 76 per cent, about the same time the premium on gold was 185 per cent. That is, it took two hundred and eighty-five cents in greenbacks to buy one hundred cents in gold. Had it not been for the exception clause on the greenback the importer would have held his sugar at $1.76, but besides the import duty he must also pay the premium on the gold. One hundred cents in gold cost him two hundred and eighty-five cents in greenbacks. At the same rate, seventy-six (the import duty), cost him two hundred and sixteen cents in greenbacks, so that instead of paying 76 per cent duty he actually paid 216 per cent, or 140 per cent more than he would have paid had there been no exception clause on the greenback. This $1,40, which went directly into Shylock’s coffers, was added to the price of the sugar and paid by the wage-worker, the manufacturer, and every other consumer of imported sugar. In the same way we were compelled to pay enormous prices for tea, coffee and several hundred imported articles.
In the year 1864, the American people paid, in consequence of the exception clause, nearly four hundred million dollars, or about eighty-seven dollars to each family. With wages at $2.00 per day the head of each family worked forty-three and one-half days during the year, or nearly one day in each week for the gold gamblers of Wall Street. The government never received one farthing of that enormous sum, and the masses of the people never understood why they paid such exorbitant prices. Shylock did not go to them with bayonet and bowie-knife and demand their money, but in every pound of imported sugar, in every yard of imported clothing they paid him tribute just the same. The weapons with which he conquered were statutory laws enacted solely for his benefit. Think of the situation. The soldier facing death on the battle field for $16 per month, sends that money to his sorrow stricken family to be used in supplying them with the necessaries of life; and in the purchase of their food and clothing with this blood-bought treasure, they pay indirectly to the gold gamblers of Wall Street from 25 to 50 per cent. Where is the man or the woman whose cheek does not burn with indignation and shame as he contemplates this robbery of the soldier and his family.
But again, the enormity of the crime did not end with Shylock’s power to rob the people through import duties. The exception clause had depreciated the greenback. This was a part of Shylock’s scheme. I know you have been told by the popular press and orators of every reason under heaven — except the right one — why the greenback was depreciated. They have told you it was because the Democrats cried them down; and again, because so many were issued it was feared the government would not be able to redeem them. Why, my friends, if the best man in Michigan were to give his notes and then refuse to receive them for debts due himself could it have any other effect than to depreciate them? I tell you it was a part of Shylock’s scheme, nothing but depreciation could follow the exception clause. Now, why did Shylock wish to depreciate the greenback? Simply to enable him to get more of them in his possession with which to buy government bonds. Having purchased such legislation he could buy bonds with greenbacks at face value, and by means of the exception clause he could turn his gold into greenbacks at enormous advantage. Let us take a view of the situation.
It is A. D. 1864. The country is desolated by war. Scarcely a family in which death has not entered. Fathers, husbands, brothers and sons have been stricken down at the battle of Spotsylvania, or the Wilderness, and there is mourning throughout the land. The wail of the widow and the cry of fatherless children are heard alike in the homes of affluence and poverty. Mothers wring their hands and cry aloud in an agony of grief, an only son has been smitten down in the battle of the Wilderness, or perhaps a first-born, with shattered limbs, lies writhing and delirious in a distant hospital. The pall of death is over the land. But the clamor and clangor of business goes on.
A cargo of goods has entered one of our ports; government requires the duty to be paid in gold. The importer proceeds at once to Wall Street, which, after the exception clause was placed on the greenback, became the great gold market of the earth, and as Judge Kelley justly said, “It invited from all the money centers of the world their most voracious vampires to come here and fatten upon the life-blood of the American people.” Thither our importer wends his way, and as it chanced to be the month of July, 1864, he found he must pay $285 in legal tender money for $100 in gold. But there is no alternative, he pays the required sum, adds that much more to the price of his goods, and turns over the $100 in gold to the custom house officers, who duly deposit it in the United States Treasury. There we leave our importer, who has been compelled to add to the price of his goods, not only the import duty but also the enormous premium on Shylock’s gold. Let us now return to our Wall Street broker and see how he has been effected by the calamity of war. The $285 in greenbacks, which the importer paid him for the $100 in gold, he immediately invests in government bonds at face value. His next step is to draw interest on his bonds, for the act of February 25, 1862, stipulated that his interest should not only be paid in gold but in advance. Having drawn his gold interest in advance he is prepared on the morrow to sell it to the next importer, and with each exchange he clears $185 on every $100 in gold. Shall we ever cease to extol the patriotism of those Wall Street capitalists? But our picture is not complete until we take a look at the soldier. Sixteen dollars per month seems a small compensation for one to stand before death in its multitude of forms. But the soldier’s love of country overcame his fear of death, and he braved the terrors of the battle field that he might bequeath to his little ones the inheritance of liberty; and if not impelled by love of country, the government did not hesitate to use its prerogative of “drafting into the service.” But did it draft money? No. It must not interfere with the “sacred rights of property.” Human life must be sacrificed for its protection, but property was inviolable.
During the latter part of the war the government paid the soldier $16 per month in greenbacks for risking his life on the battle field; with this he could purchase just $16 in government bonds. But the government paid Shylock in gold for risking his credit, and for sixteen dollars in gold, during the month of July 1864, he could purchase $43.60 in government bonds. The question now arises, how much did the government actually pay the soldier, and how much is still due him? Morally, and I believe legally, our government is today under greater financial obligations to the soldier than it is to the bond holder. Who will dare to say that human life is less sacred than capital? Or that every greenback dollar paid the soldier was not redeemed by his service — perhaps his life? Is there a quality in redemption that asks a higher price than agony and blood?
President Cleveland has been greatly censured for vetoing private pension bills, but how many of those who condemn him uphold the action of the government that perpetrated this wholesale robbery upon the soldier? And how many of them voted against General Weaver’s bill for making up to the soldiers the difference between gold and the depreciated currency in which they were paid? It is folly to claim that the war and business could not have been carried on without Shylock’s gold. We have already shown that the government after issuing its own money — the greenback — had no need of gold, until, through strategy, the exception clause was placed on the greenback, and placed there for no other purpose than that of creating a demand for the gold hoarded by the money kings of the country.
During the past few years, several states have made large appropriations for the erection of soldiers’ homes. Doubtless to many, this seems a very beneficent act on the part of the government, but is it beneficence when the robber restores a part of his ill-gotten gains to the man he has victimized? Had the interests of the soldier been as carefully guarded during the war as were the interests of the money monger, there is no doubt but that many who today languish in these institutions would be comfortable and happy in homes of their own, independent of either public or private charity.
Chapter Three
National Banking System
The next scheme for robbing the people was the national bank act, passed in 1863. Of all the villainous schemes of robbery ever practiced upon any people our national banking system stands preeminent. By it Shylock was permitted to invest his greenbacks in government bonds at face value; upon these bonds he not only drew gold interest in advance but by means of the bank scheme he actually had 90 per cent of their value returned to him. While drawing interest upon the entire investment in the form of bonds, 90 per cent of it has been returned to him in the form of national bank notes, and it is with these he carries on his banking business, loaning them out upon the most advantageous terms. On the one hand, he draws interest from the government; on the other, /ram the same investment he draws interest from his individual debtors.
For instance, you borrow $100 from your national banker, he graciously loans it to you at ten per cent in advance, which actually leaves you but $90. With this $90 you supply your family with food and clothing, upon a large part of which, as we have already shown, you pay an import duty, this import duty, please remember, went into the treasury and from thence paid interest on this same banker’s bonds. Now is it not clear that your banker has been paid two interests upon the same money, one directly upon the bank notes, presented him by the government, which he loaned to you at ten per cent interest, the other indirectly as interest on his bonds, which was paid with the import duty that had been added to the price of your goods? Now it is not for me to condemn individuals for taking advantage of this infamous law, but we do in most unqualified terms, denounce such a system of public robbery. None but the wealthy classes are able to enter upon this profitable banking business. If it is proper for the government to make the business of the wealthy thus lucrative, is it not equally just to give like advantages to the poorer classes?
A wise government will look to the interests of its wealth producers who constitute the great toiling masses, and a just government would make the way to prosperity as easy for its humblest as for its most wealthy citizen. If this system is good for banking it ought to be good for every other legitimate enterprise, and every other law-abiding citizen is entitled to like consideration.
Let us see how this system would affect, that great industrial class, the farmer. To illustrate: Mr. Jones is a farmer in easy circumstances; the markets are favorable and he concludes to sell his wheat crop; accordingly he hauls 1,000 bushels to market; having no immediate use for the money, he agrees with the buyer to sell at $1 per bushel and take in payment this $1,000 note. It is a long-time note, fully secured, bears a good rate of interest, payable in gold semi-annually in advance. Mr. Jones being well secured, feels that he has made a good exchange, in place of property idle and subject to loss in his granary, it is now safe and yielding a handsome income. He is congratulating himself upon his ability as a financier, when he is accosted by the dealer, who informs him that he — the dealer — has on hand another variety of wheat equally good as that he had just purchased, and since he had found Mr. Jones a keen, thrifty business man, he would present him with 900 bushels of it. The only expense to Mr. Jones would be the cost of handling, which would be one per cent of the value of the wheat, or $9. The wheat should be taken to Mr. Jones’ granary, where he could loan it to his neighbors upon the most advantageous terms. Nothing would be required of him for twenty years; at the end of that time, unless they could enter into a new contract, it would be necessary for him to return the 900 bushels of wheat; nothing would be required of him for the use of it, although by judiciously loaning to his neighbors twenty fold had been returned to him.
Words could scarcely express the surprise of Mr. Jones upon hearing this irrational proposition. We may imagine him taking the $1,000 note from his pocket, and scrutinizing it with the gravest suspicions, or inspecting the shining gold pieces — his advance interest — to satisfy himself that they are not spurious. But being reassured, he hastens home to carry the news of his good fortune to the partner of his joys. He playfully drops the shining gold pieces into her lap, with the assurance that they are partial proceeds of the wheat, and that they are hers to invest in the new silk she had so long desired. Mrs. Jones expresses great surprise, for she had been previously informed that a $1,000 interest bearing note would be the return for the wheat. Mr. Jones complacently taking the note from his pocket, informs her that the gold pieces are simply the advance interest on his note; he then expatiates upon the beauties and advantages of such a system, declaring that hereafter his notes must be drawn with interest payable in advance. Then with an air of haughty indifference, he informs her that besides the gold interest and $1,000 note, 900 bushels of wheat were being returned to him, and that the very men who hauled away the 1,000 bushels in the morning were returning with 900 to be replaced in his granary.
This announcement was too startling for truth-loving Mrs. Jones. She threw up her hands in horror; for twenty-eight years she had been the wife of Darius Jones, and for the first time in all these years she had occasion to doubt his veracity. But the unwelcome thought was checked as a shudder of fear ran through her frame. “Poor Darius,” thought she, “must be insane.” Great sobs of grief began to choke her utterance, when casually glancing out of the window, she saw a train of loaded wagons coming up the lane. She stood for a moment dazed, great beads of perspiration appeared on her forehead. She looked at Darius, at the approaching train, then nervously scanning the $1,000 note, she pushed it with the gold from her, and burst into a flood of agonizing tears. It was long before Darius could reconcile his wife to this mysterious proceeding, but there was a vein of ambition in her nature which dominated at times, and when she saw the benefits that must accrue from such a transaction, she not only became reconciled but regarded with pride the acumen that had so increased their material prosperity. From that time the Joneses moved in the most aristocratic circles, and were accounted among the “best” people of the community.
To many of my readers, no doubt, this little story appears like a most exaggerated fiction, but truth is stranger than fiction, and this truth is not only strange but startling. He who doubts its authenticity has only to read the laws which govern our national banking institutions, and in proof of the rapacity of the system let me add that there is today a bill pending in congress, whereby it is proposed to make the bank circulation, not 90 but 100 per cent, the full face value of the bond; in other words, Mr. Jones proposes the return of a full 1,000 bushels of wheat in addition to his $1,000 bond and advanced gold interest. But the clear-headed, vigilant Weaver is on guard, and to him the people may safely entrust this momentous question. Further, the national banks, as depositories for the U.S. Treasury, today hold $59,000,000 of the people’s money upon which they are not paying one cent interest, but are and have been for the last 20 years loaning it at from 8 to 10 per cent, or using it for effecting corners on the necessaries of life. At one time the First National Bank of New York — John Sherman’s bank — had the free use of $43,000,000 of the people’s money, at a time when its own capital stock was less than a quarter of a million. It was thus that honest John Sherman “east anchor to windward” when he was the people’s servant.
The founders of our government had a salutary dread of the bankers’ influence making itself felt in shaping the national legislation. They anticipated the evils that we have seen in our days to result from allowing the banking interest to become dominant in the halls of Congress. We find, therefore, the Third Congress of the United States Senate passing the following resolution on the 23d of December, 1793:
“Any person holding any office or any stock in any institution in the nature of a bank for issuing or discounting bills or notes payable to bearer or order, cannot be a member of the House whilst he holds such office or stock.”
The resolution was signed by the President, George Washington.
At that time there were only three banks in the whole country. Yet even then Congress thought that the bank influence was such a standing danger to the maintenance of legislative purity that it deemed it necessary to provide against it by special legislation.
The three banks of 1793 have grown to over 3,000, and the banking interest as we have seen at one time had 189 representatives in Congress, the next largest representation being that of the legal profession, while the industrial classes were comparatively without any representation.
It is hardly necessary to point out the results of the large preponderance of bankers in Congress. It has for years been seen in the whole tenor of Congressional legislation. The interests of the industrial classes have been constantly and systematically sacrificed, while the interests of the moneyed classes have been persistently pushed to the front. Now has the law of 1793 been repealed? If not, are there not enough honest men in Congress to see that it is put into effect? Unless something be speedily done to revive this law, our government will soon be openly, as it already is secretly, a bankers’ government.
If anyone doubts that the national banking system was not deliberately planned for the purpose of robbing the people, he may be undeceived by a careful perusal of the following private circular, sent out to the bankers of the country by their secretary, James Buell. Here is the circular:
DEAR SIR — It is advisable to do all in your power to sustain such daily and prominent weekly newspapers, especially the agricultural and religious press, as will oppose the issuing of greenback paper money, and that you withhold patronage or favors from all applicants who are not willing to oppose the government issue of money. Let the government issue the coin and the banks issue the paper money of the country, for then we can better protect each other. To repeal the law creating national banks, or to restore to circulation the government issue of money, will be to provide the people with money, and will therefore seriously affect your individual profits as banker and lender. See your member of Congress at once, and engage him to support our interest, that we may control legislation.(Signed by the Secretary.)J AS. BUEL,No. 147 Broadway (Room 4), New York.
Mark you it is especially the agricultural and religious press through which the secretary designs working upon the prejudices of the people. Surely not a very tame reflection upon the intelligence of these classes, but when we hear the so-called Christian minister upholding such a system of class legislation, it is evident that at least so far as such religionists are concerned, Mr. Buell did not “reckon without his host.”
Now we have no more right to condemn the men who have taken advantage of our banking laws than we have to condemn the liquor seller who complies with the requirements of the liquor law. They are both law-abiding citizens, both doing a legitimate business. The trouble is not with the individuals, but with the law. Comparatively few men will be better than the law makes them. So long as robbery is legalized, we must be afflicted with robbers. This morning the country is horrified with the news of a shocking railroad disaster, and the horror is magnified by the rumor that ghouls in human form perpetrated the most fiendish robberies upon the dead and dying; indeed it is even asserted that these fiends planned the disaster for the sole purpose of robbing the victims. But we have another picture. The life of our nation is trembling in the balance. A million of armed men face each other on the battlefield, the roar of artillery and the thunderous note of the cannon send desolation to thousands of stricken households; our country is one vast graveyard, and the land is red with fratricidal blood. In our nation’s capitol are assembled the law makers of the land; among them are those who encouraged and urged on the war, who declared that “a nation is not worth a curse without blood-letting.” These are they who sat in our congressional halls and speculated upon the most effectual means of robbing the widows and orphans of these dead and dying soldiers, who instituted laws by which the children and children’s children of these helpless soldiers should henceforth become their wage-slaves, and the bondmen of their children through all generations. Laws which, unless repealed, are destined soon to crush out the liberties of the people and the life of our Republic. Theirs was legalized robbery — the railroad bandits wrecked only a train — but these a nation.
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