CAPITAL .AND LABOR. SPEEOH DELIVERED IN THE * . ’ HOUSE OF REPRESENTATIVES, i JANUARY 18, 1867. / WASHINGTON, D. C.: McGILIi & WITHEROW, PRINTERS AND STEREOTYPERS, 1867. .}' <. • I - "I : ‘ * '■ ■ « SPEECH. The House being in the Committee of the Whole on the state of the Union, and having under consideration the President’s annual message— Mr. KUYKENDALL, said: Mr. Speaker : The bill which I introduced on the 7th of January, 1867, entitled “An act to provide a true national currency and to provide for the collection and disbursement of the * reve¬ nue , and the liquidation of the national debt , and for other purposes'' as will be seen by the title, relates to one of the most important subjects of legislation, a subject which has engaged the at¬ tention of our most profound statesmen from the earliest history of our (Government, and has been more or less prominent before every Congress that has convened since the establishment of the Government, and which to-day is as much an open question as when first introduced into the halls of legislation. Hardly a day passes without the introduction of some measure looking to a change in our monetary laws, or for the estab¬ lishment of a new monetary system, indicating the universal opinion that the present system is imperfect, if not radically wrong. The latter I hold to be true, and the bill which I introduced contemplates a thorough change in the financial policy of the Government, as well as important alterations in our revenue system. Among the chief objects for which Govern¬ ments are instituted, is that of protecting the rights of property and securing its equitable dis¬ tribution, according to the labor or service per¬ formed in its production. And no Government, whether republican or not, that fails to effect these important ends, can permanently secure the prosperity and happiness of the people. It cannot be successfully denied that physical and intellectual labor employed in production, and in the distribution of tho products of labor, is the true and only source of national wealth, and that laborers, as a whole, are poor. Look where you will upon society, you will see those who build palatial residences, living in hovels; those who manufacture the finest apparel, clothed in : the coarsest fabrics; and those who produce in abundance the most wholesome and delicate food, subsisting upon the poorest diet; all de¬ prived of the time and means necessary for social and intellectual culture, and to a great degree des¬ titute of the ordinary comforts and conveniences of life; eondemned to lives of unremunerated toil; while another cl ass, few in number, notphys- ically, intellectually, or morally better than the average of society, acquire the larger portion of the products of labor, live in comparative idleness, surrounded with all the comforts, conveniences, and luxuries of life. Besides this evil of central¬ izing wealth in the possession of the few, every few years our country is visited with a monetary crisis, prostrating all branches of productive in¬ dustry and legitimate enterprise, deranging com¬ mercial operations, retarding the development of our natural resources, preventing us from becom¬ ing self-sustaining and independent as a nation. This disparity in the conditions of society, these monetary crises and commercial disasters, are at one time attributed to over-production, another time to short production ; again they are as¬ signed to the want of sufficient tariff on imports or duties on foreign manufactures. We have greatly increased production by the invention of labor-saving machines, have raised and lowered tariffs without producing any permanent bene¬ ficial effects, unless it be the building up a cotton- mill or iron aristocracy. The wealth continues to centralize in fewer hands; the number of in¬ dustrious poor who own no real and little per¬ sonal property, continues to increase. None of the causes assigned have ever satisfactorily ac¬ counted fqr these wrongs or pointed to a remedy, because they do not reach the true source of the evil, which will be found in the unfair distribu¬ tion of the products of labor between non-produ¬ cing capital and producing labor caused by the institution of money on a wrong principle, and with too great power over labor and property. Money is the medium of distribution between- non-producing capital and labor, the rate of in¬ terest determining what proportion of the prod¬ ucts of labor shall be awarded to capital for its use, and what to labor for its productions ; and the law instituting it is the most important fun¬ damental law in any nation ; if established upon a wrong basis it cannot be rightly governed by subsequent laws. I am aware that this measure, or any one pro¬ posing such a thorough change in the monetary system and financial policy of the Government, will meet with opposition; first from the prejudices that exists general^ in the human mind against changes in the systems and usages to which they have been long accustomed; but these pre¬ judices, where honestly entertained, will readily yield to conviction. Yet it will meet with op¬ position of another and different character, one having its root in avarice, founded on the per¬ sonal and pecuniary interest of ssulless usurers, the corporations and monopolies which have been fostered into gigantic proportions, endowed with 4 dangerous powers over the property and liberties of men, by the fraudulent monetary system, the overthrow of which the bill contemplates. I have no hope that this interest will yield to any arguments I may offer, or indeed to any that can be offered ; it has a death grasp upon the nation, which, like the institution of slavery, it will not yield until utterly destroyed. But re¬ lying upon the ultimate triumph of truth, this, nor any other opposition, shall deter me from the discharge of what I hold to be a sacred duty which I owe to my immediate constituents, as well as to the American people generally, that of warning them of impending danger by point¬ ing to the path of safety. The bill provides for the reorganization of the Treasury Department of the United States, by the establishment of a “ Board of Management of the Currency and Revenue,” consisting of the Secretary of the Treasury, and four other mem¬ bers, who, in all matters relating to the currency and revenue, are to have an equal voice with the Secretary of the Treasury. The objects sought to be secured by this plan are, first, a more thorough supervision and personal inspection of the detail of the business belonging to this im¬ portant branch of the public service, by compe¬ tent and responsible officers, than can possibly be given to it by any individual, however talented and capable he may be. Admitting that a single individual may have been able to discharge these important duties before the war, when the revenues were derived mainly from custom duties and the sale of the public domain, and when the Department was not charged with the duties of providing the currency, I think it will not be doubted that the war has increased the duties and responsibilities of the Department at least fourfold, and that they are too onerous to be discharged by any, individual without detriment to the public interest. Greater uniformity in the financial policy of the Government would be attained under the proposed system; there would always be three experienced members in the Board, which would constitute a majority and prevent any sudden change in case of a change in the political sen¬ timents of the Administration. This would give confidence to the business community. Our country has become so extended, and our interests so varied, that it is impossible that any man, or any set of men, residing in one locality, can have a full and clear knowledge of the busi¬ ness of all the other localities. In order to obvi¬ ate this difficulty, and that all sections and in¬ terests may be fairly represented in the Board, the bill provides for choosing the members by districts. The bill contemplates the abolishment of all banks, State and national. It could therefore hardly be expected that any one who favoi'3 the continuance of that system of currency, or who is interested in those institutions, could so far control his prejudices and interests as to give the proposed plan a fair trial. Besides, this class of the community have controlled the financial policy of the Government and the currency of the nation for the past thirty years; and there is in the minds of the people very generally an idea that they have conducted them with an eye single to their own aggrandizement, without re¬ gard to the interests of the industrial classes. I have therefore thought it the wisest policy to exclude from the Board of Management of the Currency and Revenue all stockholders and bank officers. As money exercises a wonderful power in every departmentof business and industrial occupation, and as its nature and regulation appear to have baffled the wisdom of political economists, and led them to the conclusion that its alternate abundance and scarcity, and the fluctuating rates of interest, are irremediable evils, a full and clear knowledge of its nature and prop¬ erties, the functions it performs in business transactions, is an indispensable prerequisite in order to its institution upon true princi¬ ples.* Money is then the legal medium for the exchange of property and products; the legal tender in the payment of all debts, public and private, and a legal lien on all the property in the nation. To be fitted for the performance of these functions, it must be endowed with the following properties or powers, to wit, power to represent value, to measure value, to exchangQ value, and to accumulate value by interest. These properties or powrnrs are inherent in no natural substance, and must be conferred on the material used for money by national law. Money has no material value, only an immaterial or legal value. The material of money, gold, silver, pqper, or any other substance, is a legalized agent made to express the form, properties, or powers of money and render them available in business transac¬ tions. Common usage has applied the term measure to the material by the means of which length, weight, etc., are ascertained. It matters not whether the yard stick or pound weight be of wood, iron, or gold, length and weight are the only properties necessary to be expressed by them, and possessing the standard limits, their material is a matter of indifference. Of course some material is indispensable; but the only thing that makes one substance preferable to another is its superior convenience. So of money ; it is a matter of indifference by what material the powers are expressed, for the ma¬ terial is merely a substance fixed upon by law; the natural powers of any material do not make it money. Its powers and agency, as money, are delegated to it by law, in addition to its natural capabilities. When gold is used, the powers conferred upon it make it an equivalent for every species of property.* If gold had not been select¬ ed for the material of money, and a legal power given to it to exchange property, and to accu¬ mulate interest for its use, a man would have a3 little need for more gold than he requires for utensils and ornaments, as he has for more clothes than he can wear, or more tools than he can use. But when it is made the agent of these legal powers, it becomes necessary to acquire the gold in order to discharge debts; and the quantity of 5 the metal being limited, its owners are enabled to extort from the necessitous a very high price for its use. The common opinion that the ma¬ terial of a currency must be- something scarce and difficult to procure, that the limited amount may render it permanently valuable, arises from a misconception of the nature of money, the properties of which are entirely independent of the material. The value of money depends upon its powers to represent, measure, accumulate, and exchange value. These powers, given to any convenient mate¬ rial by congressional enactment, will qualify it for a medium of exchange, and, in every partic¬ ular, constitute it money. The power to make money and regulate its value is an essential at¬ tribute of sovereignty, carrying with it the power to control the value of all the property in the cation, regulate the division of the products be¬ tween capital and labor, and fix the rewards of labor in every department of industry. While this power has been wisely and properly granted to Congress, there is no more authority granted to that body by the Constitution of the United States to delegate this sovereign power to any class of individuals or corporations, than there is for the delegation of the judicial power. It is, therefore, the imperative duty of Congress to institute money upon such a wise and just basis that its value and powers may be uniform throughout the jurisdiction of the Government; and with the power vested in the sovereign peo¬ ple to regulate its value so that it may distribute products to producers according to the labor and service performed in their production. Time will not permit me, on this occasion, to treat in detail the general nature and properties of money as fully as the importance of the sub¬ ject demands, and i shall, therefore, confine my¬ self to a few brief remarks on its accumulative power, and then proceed to show that the rate of interest is the governing power in the dis¬ tribution between- capital and labor, and that the present rates greatly exceed the increase by nat¬ ural production. The rate, or ahiount, of inter¬ est theft the dollar commands, determines its value, and makes it equal to a given amount of actual value, or property, as much as the net proceeds of a farm determines its value—which consists in its value to produce. The value of the money is artificial, and depends on its legal >ower to represent actual value and to accumu- ate by interest. A farm that produces a net annual income of a thousand aollars is more valuable than one that yields but five hundred dollars; so, a dollar that can be loaned for twelve per cent, is more valuable than one that can be loaned for but six per cent. The value of money as much depends upon its legal power to be loaned, for an income, as the value of the farm does upon its power to produce. Any increase or diminution of the power of money to accumu¬ late by interest increases or diminishes propor¬ tionately its value, and, consequently, its power over labor and property. To keep the value of money uniform, the rate of interest must be kept uniform. Doubling the power of the dollar to accumulate doubles the value of the dollar. It may still retain the name of dollar , but it will possess twice its former power over property and labor. It may be objected that, while what has been said of money is true, so far as our home busi¬ ness is concerned, yet the adoption of such a monetary system would operate injuriously upon our foreign trade; that, as all commercial na¬ tions have legalized the so-called precious metals as money, we cannot maintain commercial rela¬ tions with them unless we also legalize them as money. A sufficient answer to this objection is, that our coin is not current or legal money, at the standard fixed by our laws, in any foreign nation. They only receive it at the standard fixed by their laws, and greatly prefer our bul¬ lion to our coin. Besides, legitimate commerce is the exchange of the products of the territory and labor of one nation for those of another. All beyond mere barter is a matter of debt, and if we imported three hundred millions of dollars (that being about the amount of our coinage) in excess of the exports of our production, we would have to part with all our coin, which would derange the entire industrial interests of the nation. Again, if we did not use these met¬ als for a circulating medium, we would have more of them to ship abroad as bullion, to settle balances or to exchange for articles of real value. We could take up three hundred millions of our national -bonds, now held abroad, and thereby save eighteen million dollars of interest annu¬ ally—which would be a great relief to a people overburdened with taxes. The advocates of a specie currency argue that the so-called precious metals require about an equal amount of labor for their production the world over, and therefore they are the true measures of all values—that it is the labor incor¬ porated into them that gives them their value as money. If this be true of these metals, it should be true of all the productions of labor. If A produces, by one hundred days’ mining, gold to the value of two hundred dollars, the • Government will stamp it as money for him; and if B produces, by one hundred days’ labor, two hundred bushels of wheat, which the Gov¬ ernment purchases of him for two hundred dol¬ lars, and he is willing to take a piece of papev stamped as money by the Government, “ two hundred dollars,” there can surely be no valid objection against the Government doing so. It would represent the same amount of labor ; and if it had the same legal powers as the gold, it would perform all the functions of money equally as well, coextensive with the jurisdic¬ tion of the law. We have a practical illustra¬ tion of this in the first series of Treasury notes issued, which was fifty millions, payable in coin on demand. These notes passed at par with coin until the banks and the Government suspended specie payments, when they began to depreciate in value, as compared with coin, and continued to decline until they were made receiva¬ ble for duties on foreign imports, or in other words, were made legally equal to coin, when 6 they immediately rose to par and have remained so ever since ; or if D be the holder of a bond for one thousand dollars which he wishes to con¬ vert into money, and is willing to exchange it for a legal tender Treasury note, it is difficult to conceive of any valid reason why the Govern¬ ment should not make the exchange, rather than subject him to heavy discount, for the benefit of some banker. This erroneous idea that the value of money inheres in its material, and that gold and silver possess some indefinable property or qualification, that fits them above all other substances for the material of money is at the bottom of the false theories respecting the the nature of moneys, and its rightful institu¬ tion. It is the cause of its alternate abundance and scarcity, of the high and fluctuating rates of interest, and has led to the adoption of the many false systems of banking, by which the legitimate business of the countrv has been so often deranged, and the industrial wealth-pro¬ ducing classes robbed of the products of their labor. And while this mistaken notion is en¬ tertained by the people and their law-makers these evils must continue. But when the nature and properties of money are clearly understood, and there is a willingness on the part of all to be governed by the precepts of the golden rule, the chief difficulty in the way of its institution on true principles will be removed ; and its institu¬ tion on correct principles will do more to lift the weight from the back of the industrial classes, and encourage the development of our resources, than all the bankrupt and tariff laws that have been enacted since the formation of the Govern¬ ment. I come now to show that the rate of interest on money is the governing power in the distri¬ bution of the products of labor between non- producing capital and producing labor. There are but two purposes to which the yearly pro¬ ducts of labor can be applied. One is the pay¬ ment of the yearly rent or interest on the capital employed, and the other is the payment of labor* The rate of interest maintained on loans of money determines what proportion of the earn¬ ings of labor shall be paid for the use of capital, and what proportion shall be paid to the laborers for their productions. If laborers pay to capital as rent or interest for the year their whole sur¬ plus products, the laborers, as a body, work for a mere subsistance of food, clothing, and shelter. To give an idea to what extent the power of interest operates, it is only necessary to say, that all the money lent on bonds and mortgages by individuals, by insurance and trust companies, all lent for United States, State, county, city, railroad, canal, and other bonds, to make public improve¬ ments, whether these improvements be made by corporations, by the State, or by individuals, also all the money lent by banks, brokers, and individuals on promissory notes—all these loans are operating with a like centralizing power against the producer and distributors of the national wealth and in favor of the money lend¬ ers. This power also establishes a like rate per cent rent to be paid for the use of all property, real and personal. All the goods on hand in the nation, and in process of being manufactured, are under tribute to this centralizing power." It is an unavoidable power, because it is insti¬ tuted and enforced by the national laws, and is the basis upon which all market values are founded. It may. be proper to remark in this connection, that in the calculations that follow, I have compounded the interest annually, which is the national law governing increase by per¬ centage. The lowest rate of interest upon money established by any State is six per cent per an¬ num, and the rate has fluctuated between six and twenty per cent, since the formation of the Government. If we take into the account the rates authorized on the bonds of the United States, States, &c., and the price at which these bonds have been sold and the exorbitant rates in many cases charged in business transactions, I think it will not be doubted that the rate has averaged as much as ten per cent, per annum since the earliest settlement of the country. To get a clear idea of the accumulative power of money and its in¬ fluence in the distribution of the wealth of the nation, we must take the longest possible period in our history. The first permanent settlement on our territory was made at Jamestown, in Vir¬ ginia, in 1607, or two hundred and sixty years ago; now, if these settlers had purchased of the mother country the entire territory of the United States for one dollar, and given their obligations bearing ten per cent interest, payable two hund¬ red and sixty years after date, their obligations would fall due the present year, and I doubt not it would be considered by many to have been a good financial operation, and all that would be necessary to discharge this obligation would be for the Secretary of the Treasury to part with a portion of the gold now lying idle in the Treas¬ ury, or to make a draft for the money deposited with the national banks. But the result will, I think, convince the most strenuous advocate for high rates of interest, that no nation or people can pay ten per cent without robbing labor and centralizing the wealth in the hands of the very few. This one dollar with interest at tQn per cent compounded annually for two hundred and sixty years, will amount to fifty nine billion six hundred and fifty million dollars, or over three times the present value of all the property real and personal of the United States. There are in the United States at the present time about seven million two hundred thousand male inhabitants over the age of .twenty years, and allowing each of them to work three hundred days in the year, the number of day's work performed annually would be two billion one hundred and sixty million. To pay the annual interest on the above sum would require two dollars and seventy- six cents ($2 76) for each day’s labor performed in the nation. Now, let us see what the result would have been with the honest and well regib- lated dollar—with money so instituted as to bo the servant and not the master of labor. Had the obligations for the payment of the one dollar been made to bear three per cent per annum, the amount would be two thousand one hundred 7 and eighty dollars. But it may be objected that the resources of the country were not developed as rapidly during her colonial condition as since the establishment of her independence, and that the per cent, is above the average rate of interest. I will therefore compare the increase in the na¬ tional wealth by natural production, with the accumulative power of money at seven per cent, interest since the Declaration of Independence. There are in the thirteen original colonies or States three hundred and forty-seven thousand square miles, or two billion ninety-five million seven hundred and sixty thousand acres, which I will suppose our ancestors to have purchased in 177G at fifty cents per acre, including improve¬ ments and personal property, the amount would have been ten hundred and forty-seven million eight hundred and eighty thousand dollars.' This would have been but little over two hundred and fifty dollars per capita , which I think will not be censidered an over estimate of the then value of the property of the nation, for allow¬ ing it to have increased at the rate of increase during the decade from 1850 to I860, which was three and one-third per cent per annum, the amount on the 4th of July, 1867, would in round numbers be twenty billion seven hundred and twenty-three million, three hundred and twenty thousand dollars, ($20,723,320,000,) which is a little in excess of the present value of the na¬ tional wealth, which is, in round numbers, twenty billion three hundred and thirty million dol¬ lars. Now, had the then estimated value of the wealth of the nation, ten hundred and forty- seyan million, eight hundred and eighty thou¬ sand dollars ($1,047,880,000) increased at the rate of seven per cent, per annum for the same time, the amount woula, in round numbers, be five hundred and six billion one hundred million dollars, or nearly twenty-five times the value of the national wealth on 4th of July, 1867, in¬ cluding the territories since acquired. Again, to present this subject in still stronger light, I will estimate the Revolutionary war to have cost the nation three hundred and sixty-two million, one hundred and twenty thousand dollars, ($362,120,000,) which I think all will admit a very moderate estimate: suppose our ancestors, at the time of the Declaration of Independence, to have purchased the country of England for this sum, and given their obligations, bearing seven per cent, interest, payable ninety-one years after date, with interest compounded annually ; this, I doubt not, would be considered to have been a good financial operation; and so it would, if money were worth seven per cent, per annum, or the increase in the national wealth had equalled seven per cent, per annum. Such a negotiation would have saved the cost of the Revolutionary war. I will, therefore, add it to the then estimated value of the national wealth; which would make the value of the national wealth at that time one billion, four hundred million dollars. Had this sum increased at the rate of three and one-third (3£) per cent, per an¬ num, the amount would be twenty-seven bil¬ lion six hundred and eighty-three million dollars, ($27,683,000,000.) while the increase on the three hundred and sixty-two million one hundred and twenty thousand dollars ($362,120,000) for the same time, at seven per cent., would be one hundred and seventy-four billion nine hundred and thirty million dollars, ($174,930,000,000,) or over six times the amount of what the entire national wealth would have been, and over eight times the amount of the present value of the national wealth. There are a class of financiers, claiming to be honest and intelligent, who argue that money is worth more in new and undeveloped than in old and improved countries. I have heard hundreds of them contend that it was worth ten per cent, in the State of Illinois. For the benefit of this class I will exhibit the following facts. I will take the State of Illinois, which contains 55,000 square miles, or 35,200,000 acres, and which, considering fertility of soil, mineral wealth, commercial advantages, and variety and salu¬ brity of climate, I think is not surpassed by any other contiguous territory of equal extent pn this eontinent or elsewhere. I think it quite safe to assume that the rate of interest on money there has averaged ten per cent, per annum since the first settlement of the territory, which I will assume was on the 4th of July, 1816, or fifty-one years ago. Now, had the present settlers or their ancestors purchased the entire territory of the State at the Government price of one dollar and twenty-five cents per acre, and given their notes or obligations therefor, bearing ten per cent, interest per annum, these obligations would fall due the present year, and would amount to the enormous sum of five billion seven hundred and eighteen million forty-four thousand four hundred and forty-four dollars ($5,718,044,444,) or one hundred and sixty-two dollars and forty- four cents ($162.44) per acre, for each and every acre of land within the limits of the State. Tlie interest on the total sum for one year would be five hundred and seventy-one million eight hun¬ dred and four thousand four hundred and forty- four dollars, ($571,804,444,) to pay the interest which would require an annual rental of sixteen dollars and twenty-four cents ($16.24) per acre on all the lands in the State, or probably as much as thirty dollars per acre for that portion under cultivation, while the value of the State as per census of 1860 was but eight hundred and seven¬ ty-one million eight hundred and sixty thousand two hundred and eighty dollars ($871,860,280.) If you double this amount it will not amount to one third of the accumulations of the interest on the purchase, at one dollar and twenty-five cts. ($1.25) per acre, there is not one of my col¬ leagues that does not know that the lands, with all the cities, towns, railroads, and other im¬ provements, would not sell for half the amount of the accumulations by interest on the first purchases. This, too, notwithstanding that pop¬ ulation and wealth has poured into the State beyond any parallel. Kellogg, who has given this subject of the accumulative power of money and the distribu¬ tion of wealth, as much attention, and treated it 8 more ably than any man of the age, says, that before the war as much as one half of all the wealth of the nation was owned by five per cent, of the population, and these for the most part, the non-producers, who loaned their money, or rented their property to the wealth-producing classes. The effect of the war has been to dimin¬ ish production, increase the rate of interest on money, and to centralize the wealth more rap¬ idly. I therefore think it quite safe to estimate that as much as sixty per cent, of the wealth is now owned by five per cent, of the population. If any one doubts this let him take any city or town, the population of which is ten thousand, and see if he cannot find one hundred of the most wealthy citizens who own at least sixty per cent, of the property, and allowing five to the family, this would make five hundred, which is five per cent, on ten thousand. Taking the na¬ tional wealth at twenty billion dollars, it would give to the non-producing class twelve billion dollars of the national 'wealth, which they loan or rent to the industrial classes, and the rate of interest will average at least eight per cent, per annum, making the yearly burden imposed upon labor nine hundred and sixty million dollars ($960,000,000,) while the increase on twenty billion dollars ($20,000,000,000) of national wealth at three and one-third per cent, per an¬ num, will amount to but six hundred and sixty- Beven million dollars ($667,000,000), leaving the wealth-producing classes indebted to capital or the non-producers two hundred and ninety- three million dollars ($293,000,000) at the end of the year. But the question naturally arises how we are to ascertain the just rate of interest on money. Happily we are not without sufficiently reliable data to approximate the true rate nearly enough for all practical purposes. Agriculture is tue leading interest and foundation of the national wealth ; and the increase in this important branch of industry may be taken as the true in¬ dex in all other departments ; and the division between landlord and tenant may be safely adopted as the rule of distribution between capi¬ tal and labor in all other branches of productive industry. And I find by careful examination and critical analysis, that during the decade from 1850 to 1860, which was as prosperous a one as we have had since the establishment of the Government, the increase in improved lands and unimproved lands was forty per cent., the increase in wheat, rye, corn, and oats, forty-four per cent., and the increase in all kinds of live stock, thirty-four per cent. Taking then, the increase in lands, all kinds of grain and live stock, and the total increase in these staple pro¬ ductions of agriculture for the ten years was thirty-nine per cent., or three and one third per cent, per annum, nearly; and a rentor cannot afford to pay over one third of the net proceeds and keep up all repairs of a good and will-im¬ proved farm. If then the division of products detween capital and labor in the most important pranch of productive industry, be adopted as the standard of distribution between capital and labor in all other departments of useful industry it will be seen that the true rate of interest on money should be but one and one ninth per cent, per annum. Now let us see how the ac¬ count would stand between labor and capital with the rate of interest on money at one and one ninth per cent, per annum. Twelve billion dollars at this rate would be one hundred and thirty-three millions, while the increase on twenty billions ($20,000,000,000) of national wealth at three and one-third per cent, would be six hundred and sixty-six million dollars, ($666,000,000,) leaving a balance in favor of the wealth-producing classes at the end of the year of five hundred and thirty-three million dollars ($533,000,000,) with interest at two and half per cent., the balance in favor of the industrial classes at the end of the year would be three hun¬ dred and sixty-six million dollars, ($366,000,000), and with interest at three per cent., the balance in favor of labor would be three hundred and six million dollars ($306,000,000) annually. A result, in either case, more encouraging to the industrial wealth-producing classes, and one very much more to be desired by all patriots, philanthropists, and Christians, than the former one, which will leave labor indebted to non-pro¬ ducing capital two hundred and ninety-tbiee million dollars ($293,000,000^ anuually. I come next to consider the fitness or rather the unfitness of the present monetary and reve¬ nue systems, and the financial policy to meet the wants of the Government and business in¬ terests of the country. Time, on this occasion will not permit me to examine in detail the laws creating, the so-called national banks, and es¬ tablishing the revenue system, and I must con¬ tent myself with the notice of only a few of their most important provisions, which will serve to indicate their general character, and show that they are calculated to promote the in- tererest of non-producing capital and to impose unnecessary and grievous burdens on the enter¬ prising industrial classes. We have contracted an enormous national debt, one more onerous than that of any civil¬ ized or Christian nation on the globe. Th« annual interest on the national debt of Great Britain is but one hundred and twenty-one mil¬ lion dollars ($121,000,000.) When the patriotic bankers and financiers get the “greenbacks" withdrawn from circulation, and the whole na¬ tional debt converted into gold interest bearing bonds, and we add to the national debt proper, that of townships, counties, cities, and States, con¬ tracted for war purposes, our arinual interest will amount to at least two hundred and forty million dollars in the money of trade. Every dollar of this debt, interest, as well as principal must be paid by the labor of the nation. It makes no difference whether it is collected from duties on foreign imports, excise on whisky, tobacco, and other luxuries. I care not how cunningly taxes may be laid, the burden must as surely as death will come to all the living, in the end all be borne by labor. It is therefor® the interest, nay the imperative duty of every 9 Christian, philanthropist, patriot, and lover of justice, as well as of the entire industrial classes, to see that these burdens are made a? light as possible and equally distributed on all classes and interests. The first question that arises is, will the financial policy adopted and being pur¬ sued by the Government lead to these results? I think a thorough investigation and careful ex¬ amination of the subject will convince any intel¬ ligent, impartial mind that it will not. The reasons upon which this opinion is founded, are as follows: The same parties who have con¬ trolled! the money interests of the nation in the past, are to conduct it in the future, and by means somewhat similar, to wit: a bank cur¬ rency purporting to be redeemable in money ; under the former system this currency was is¬ sued under the authority of the several States, sectional interests and jealousies prevented a consolidation, and lessened the power of the bankers for mischief. The currency issued b} 7 these institutions was never any better apology for money than falsehood for truth. The neces¬ sity for money to conduct business operations, and the absence of anything better, compelled the people to accept their notes in exchange for their property and products, which gave the bankers the control of the moneyed interest of the whole country; with power to regulate the value of all the property in the nation, and fix the rewards of labor in every department of in¬ dustry ; and they wielded this power with an eye single to their own benefit. They expanded and contracted the currency, raised and lowered the rate of interest, encouraged or prostrated all legitimate enterprise and productive industry, set the laws at defiance, and suspended and re¬ sumed specie payments at pleasure, and in every possible way made the public interest subservi¬ ent to their cupidity. The so-called national banking system is founded on the same princi¬ ple, with greatly multiplied powers for mischief. A change of base, while the principle remains the same, can, at best, be but the exchange of one evil for another. To get a clear understand¬ ing of the practical workings of this system and its powers for oppressing the wealth-producing classes, we must consider it in connection with the laws authorizing the national loans and es¬ tablishing the revenue system, for they are in¬ separably connected. Time, on this occasion, will not permit a general review of those laws, and I will therefore confine myself to the con¬ sideration of a few of their most important pro¬ visions, which I think will serve to show that they are founded on a wrong principle and in¬ imical to, and subversive of the principles of freedom and equality, upon -which our demo¬ cratic institutions are founded, and must work great injustice to the wealth-producing classes. The law enacting the national banking system clothes the Secretary of the Treasury of the United States with unprecedented and danger¬ ous power, his control over the Bureau of the Currency is absolute without check or restraint from any other department of the Government. Indeed, so far as the interest of the people is concerned, with but few and unimportant excep¬ tions, these unrestricted powers prevail through¬ out the whole law. Thus the whole moneyed in¬ terest of the nation is under the control of a single man, the banks are only the medium through which this centralized power operates. And when these despotic powers (for such they surely arc) are vaelded by one whose life has been devoted, not to encouraging the develop¬ ment of the national resources by aiding hone&k industry and fostering legitimate enterprise, but to sacrificing public and private interests, and filching from honest toil the last farthing when necessary to pay large dividends to the stockholders in the banks with which lie may have been connected or over which he may have been called to preside. This is the charac¬ ter of the man these bankers will insist shall fill the office of Secretary of the Treasury of the United States, and they will permit no other character to occupy that place for any length of time, for through Congress they have the power to remove him, and should this system be con¬ tinued, we will not have many elections before a majority of that body will be stockholders in these banks, if indeed that be not the case al¬ ready. I venture the* prediction that if you should interrogate the Secretary as to the wis¬ dom and justice of his plan, he would tell you it was the wisest and best that could possibly be devised, for he had consulted with the lead¬ ing bankers and most intelligent business men of Wall street, New York, Third street, Philadel¬ phia, and State street, Boston, by all of whom it was most heartily approved, and well it might be, because if you could go back and get at the paternity of the measure, you would find it originated with them, was presented by them to the Secretary for his approval, and not by the Secretary to them for their endorsement. This is the history of every financial measure adopted by the Government since the commence¬ ment of the rebellion, excepting alone the issue of the legal tender Treasury notes, and this was the measure that sustained the credit of the Gov¬ ernment and carried us through the darkest hours of our troubles, and which was opposed by these bankers and intelligent business men at every step, and which they now demand shall be blotted from our statutes. It is entirely un¬ necessary for me to say anything, in this con¬ nection, in relation to the business and interest of the bankers, these are understood by all; but a word in reference to the business and in¬ terests of these intelligent business men, of whose wisdom and patriotism newspapers have so much to say, and who have so much influence in molding the financial legislation of the Govern¬ ment, may not be amiss; for it would be very natural to suppose that they were the energetic, enterprising portion of our business community, who are engaged in the development of our re¬ sources ; but not a bit of it. They are the specu¬ lators in stocks, food, clothing, and all the products of labor, standing between the pro¬ ducers and consumers—amassing fortunes by a species of the very worst kind of gambling; and 10 While they are permitted to exercise such a pow¬ erful influence over the financial policy of the Government, as they now do, we can be nothing but a nation of gamblers ; useful enterprise can¬ not be undertaken ; nor can the legitimate com¬ mercial operations of the nation be conducted other than as gambling operations. These banks are authorized to be located in every city and village throughout the length and breadth of the land, forming a complete system of financial es¬ pionage. Under the revenue system they will have their thousands of agents in every part of the country, clothed with authority to pry into the affairs of each individual. I say their agents, because they will control the Govern¬ ment, and no officer or agent of the Government, who is not in the interest and the willing tool of this moneyed aristocracy, can hold any office or place under the Government. Through these means they will have a full knowledge of the business of every miner, farmer, mechanic, mer¬ chant, manufacturer, railroad company, and other enterprises in the nation. This will enable them to operate understandingly and with their un¬ restricted power over the currency of the nation, they can make every other interest, however great, subservient to their cupidity, and tax the industrial classes until they become as help¬ less as the fly in the spider’s web—tax their manhood out of them. Their circulation is to be apportioned among the States and Territories by the Secretary of the Treasury, having due regard to the existing bank¬ ing capital, resources, and business of such States and Territories. The effect of this will be to give a few of.the eastern cities and villages the control of the currency of the nation, they having major part of the existing banking capital. The law pro- videsthat three-fifths of the amount to be kept on hand in lawful money to redeem their circulation may consist of clearing house certificates, and balances due from other associations. The effect of this will be to require the banks in our large cities to keep on hand but ten cents, and those located in all other places but six cents on the dollar in lawful money, for the redemption of their circulation, or an average of about eight per cent. It would be quite natural to conclude that the banks gave the Government some val- able considerations for the grant of those sover¬ eign principles and powers; but they do not. They are to have the use of the public money (except receipts from customs) for banking pur¬ poses. They draw the interest in gold on the bonds deposited to secure the redemption of their circulating, notes, and receive ninety per cant, of the value of the bonds so deposited, which they loan to the people at from seven to tan per cent., and to reimburse the treasury for printing their notes, and all other expenses in¬ curred under the law, and in lieu of all taxes on their circulation, and the bonds deposited to secure the redemption thereof, they are required to pay into the national treasury only one half of one per cent, semi-annually, which will not probably more than defray the expenses incurred by the Government under the law. Thus, in¬ stead of the bankers paying a liberal bonus to the Government for these unheard-of privileges and powers, as claimed by the bankers and their allies, the law virtually exonerates them from taxation. Let us now look at the profits these bankers derive from this system. To put in ci> culation three hundred million dollars ($300,- 000,000) currency, will require the deposit of three hundred and thirty-three million three hundred and thirty-three thousand three hurt- dred and thirty-three dollars ($333,333,333) in bonds, on which they draw six per cent, in gol 15 payers. I have estimated that these classes were, under the present system, paying to non-pro¬ ducing capital rent or interest on three fifths of the national wealth, or twelve billion of dollars, ($12,000,000,000,) and that the rate of interest averaged as much as eight per cent, annually. If the system here proposed be adopted, the two billion six hundred million dollars ($2,600,- 000,000) would cease to be a charge on the tax¬ payers, and must therefore be deducted from the twelve billion dollars ($12,000,000,000) upon which the industrial classes are now paying in¬ terest or rent, which would leave nine billion four hundred million of dollars ($9,400,000,000) upon which they would have to pay interest or rent. Now if this system be adopted and the rate of interest on the Government indebtedness be fixed at three per cent., the account between non-producing capital and productive industry would stand thus: $12,000,000,000 at 8 per cent. $060,000,000 9,400,000,000 at 3 per cent. 2S2,000,000 Net annual saving to the tax-payers. 67S,000,000 With the rate of interest on the Government bonds at two and a half per cent, the result would be thus: $12,000,000,000 at 8 per cent. $900,000,000 9,400,000,000 at per cent. 235,000,000 Net annual saving to the industrial wealth- producing class.••. 725,000,000 With the rate of interest at three per cent. the daily saving would amount to one million eight hundred and fifty-seven thousand five hun¬ dred and thirty-four dollars, ($1,857,534,) and at two and a half per cent, it would be one mil¬ lion nine hundred and eighty-six thousand three hundred dollars, ($1,986,300.) The smallest of these annual savings would, in a few years, build the necessary furnaces, mills, and factories, to supply our wants as well as to construct all needful lines of transit. The wisdom of the policy of giving to labor all necessary protection in the development of our natural resources to the extent, at least, of supplying our own wants is too manifest to admit of argument. But I think a greater delusion never entered the mind Ctf man than that the effect of our so-called pro¬ tective tariff laws is to encourage productive in¬ dustry and protect our labor against the pauper labor of Europe. Their effect is directly the op¬ posite. They protect our aristocratic capital in the shape of fallacious bank promises against the capital of Europe, support a shoddy bank¬ ing system, and build up a cotton and iron-mill aristocracy, and burden and oppress the wealth- producing classes. The English Government securities bear three per cent, interest per annum, and, with money instituted on true principles, no sound reason cam be given why it should bear a higher rate in the United States. I have good authority for saying that with capital at three per cent., iron (an article of prime necessity) can be manufactured for the tfupply of the northwest, at least from the ores of Lake Superior, Wisconsin, and Missouri, wifch the coals of Illinois, Chicago, St. Louis, and intermediate points in the coal basin in the valley of the Illinois river, without a fraction of protection beyond that afforded by the cost of transportation from Europe. Ana this, I believe, will be found true in other lo¬ calities as well as of other articles. We boast of our inexhaustible deposits of coal, iron, and other minerals, and their easiness of ao- cess; of our water power and other advan¬ tages and facilities for manfacturing ; and such indeed is the quality, abundance, and accessi¬ bility of our ores and coal, that, in the localities named, it does not require over two-thirds of the labor to produoe a ton of iron that it does in England, where it is manufactured from lean ores dug from thin veins hundreds of feet below the earth’s surface. Yet, with all these advan¬ tages, we are told thatJphor cannot be employed in this important branch of industry without increased rates of protection. The foregoing figures will, I think, explain this anomaly. I think they also show very clearly that the wrongs and oppressions which the industrial classes are suffering are caused by the unfair distribution of the productions of la¬ bor between non-producing capital and produo- ing labor, resulting from the institution of mo¬ ney with such power over labor and property that even a prohibitory tariff could not afford them any general permanent relief, for the reason that it would not reach and remove the cause. But with money instituted upon true principles and a just rate per cent, established for its use, la¬ borers would receive an equitable proportion of their productions and capital a just reward for its use. All branches of productive industry would be quickened ; capital would seek invest¬ ment wherever there was a reasonable prospect of a fair return for its use. Instead of shipping the raw material across the continent, and even across the ocean, as we now do, manufactories of all kinds would be established wherever nat¬ ural advantages and facilities offer, and the pro¬ ducer and consumer brought side by side, and their exchanges made without the aid of middle men and extortionate carriers. New and com¬ peting lines of transit would be constructed wherever there was a prospect for a fair return on the investment. Thus the carrying monopo¬ lies, which are literally robbing the producing classes, will be destroyed. The people could regulate the currency to suit themselves, and so few would be the articles needing and so small the amount of protection required, that no serious objection would ever be made to it by any section or party. The vexed questions of the currency and protection would be very nearly entirely removed from our na«r tional councils, and the business of the nation would not, as under the present system, be sub¬ ject to the control of a few avaricious bankers and the whims of some utopian financier who may chance to be called to the Secretaryship of the Treasury of the United States. Here I propose to rest the argument, believing that sufficient has been presented to convince the most strenuous advocate of protection ^hat 16 the adoption of the monetary system proposed in the bill will do more to protect labor, foster and encourage productive industry and legiti¬ mate enterprises in the developement of our na tural resources, than all the protective tariff laws that ever have or can be enacted ; that the present wrongly constituted monetary system is the chief of monopolies, and its overthrow will cause the downfall of all railroad and other kin¬ dred monopolies. J will now present and point out the fallacies of some of the objections that may be made to the proposed plan. It may be objected that I have estimated the amount of t*he circulating medium necessar)' to make the exchanges of the property and pro¬ ducts of the nation too high. To this I reply, the amount of currency needed by a nation is in proportion to its production; and as the adop- tion of this system would take away the occupa¬ tion of the bankers, brokers, and speculators, they would be compelled to earn their living by honest industry, which would add them to the industrial classes, the direct effect of which would be to increase production; and the impetus giv¬ en to enterprise by the establishment of a just rate of interest on money would require a much larger amount^er capita than when, as under the present system, it is controlled and doled out to the people by a few selfish bankers. To this addi¬ tion to the wealth-producing classes must be added the army of clerks, assessors, collectors, inspectors, and other officers and agents em¬ ployed by the Government in the collection of the internal revenue; for under the operation of this system the Government expenditures would be so reduced that the funds necessary to defray the current expenses could be collected mainly from custom duties and the sale of the public domain. Any deficit that might occur could be assessed on the several States and collected by them with the employment of but little addi¬ tional force beyond that required in the col¬ lection of the revenue for State purposes. Besides, the emancipation of labor from the thraldom imposed by the present ‘false system, with the inducements offered by our agricultural and mineral resources and other advantages and facilities, would draw from the Old World thou¬ sands of skilled miners, artizans, and others, which, I think, would soon create a demand for a greater rather than a less amount than I have estimated, and our debt would be absorbed into the currency in a shorter time than I have named. Another and favorite objection that the bank¬ ers and their allies will make to this or any measure looking to the emancipation of labor from the thraldom imposed upon it by their false system is, that, since money never has been in¬ stituted on a just principle, it never can be. This is the argument used by kings and despots to prove that they have a divine right to rule, and that a democratic or republican government is a trespass against divine authority, and never will be per¬ mitted to stand, except for a brief period of time. It has just as much force and reason in the former case as in the latter. To say that the people will not accept, in ex¬ change for the products of their labor, legal-ten¬ der Treasury notes, issued as provided in the bill, is to say that they will repudiate the Gov¬ ernment; and to say they have not the intelli¬ gence and virtue necessary to properly regulata the currency, under the provisions of the bill, is to deny that they have the capacity for self-gov¬ ernment. I have shown, and I think clearly proven^-— 1st. That the poivers of money are legal and entirely independent of its material—its powers as money being derived from the law instituting it and making it a legal tender ; that the power to make money and regulate its value is an es¬ sential attribute of sovereignty; and that it is the medium of distribution to non-producing capital and producing labor, the rate of interest determining what proportion of the products of labor shall bo awarded to laborers for their pro¬ ductions, and what to capital for its use. 2d. That our present monetary system is founded on the aristocratic idea of government, and is inimical to and subversive of our demo¬ cratic republican institutions. If continued in operation, the wealth must be rapidly central¬ ized in the hands of the few non-producers ; the wealth-producing classes oppressed, degraded, and ultimately reduced to a state of positive servitude, democracy prove a failure, and uni¬ versal suffrage—a sham. 3d. That it has been demonstrated wit h P-qnflT clearness that the monetary system contem¬ plated by the bill is founded on the democratic idea of government, adapted to the genius of our free institutions, and in harmony with the letter and spirit of the Constitution ; that under its operation labor would be properly compen¬ sated, the wealth diffused and distributed accord¬ ing to the labor or service performed in its pro¬ duction democracy maintained; and universal suffrage rendered ja universal blessing. Having pointed out, and as I believe fully sustained, its superiority in all respects in an economical point of view, it only remains to show its advantages in a political point of view. It would restore commercial relations between all parts of our common country ; develop and harmonize that mutuality of interest which naturally exists between the different sections of our extended domain, growing out of varieties of climate and productions, which b}* unwise legis¬ lation has been made to appear adverse and conflicting ; it would interest each citizen pecu¬ niarily in the preservation and perpetuity of the Government. Dispensing its blessings im¬ partially to all, it would make us a homogeneous family of States—one in interest, one in sympa¬ thy, and one in purpose. United by theso strong ties, our Union would stand proof alika against the machinations of enemies within and the assault of foes from without. Pass the bill, adopt this system, separate tha races, colonize the African, elect General Grant President in 1868, then peace, prosperity, and happiness, will reign over our glorious country.