> I 



PROVISION OF BORROWING FACILITIES. 285 



Judged by these postulates the regime of the individual money 

 lender is wholly defective ; he satisfies, indeed, the condition of 

 proximity, but it is impossible for him, trading as he does upon his 

 private capital supplemented merely by occasional borrowings, to 

 satisfy the demands for loans at any time and to any amount ; he 

 has no rules save those of his own conscience, and they are variable 

 at pleasure ; he is but too prone it is the imperfection of human 

 nature to exact terms high in proportion to the urgency of the 

 borrower's need, and not in proportion to the security offered ; his 

 accounts, if kept at all, are just what he chooses to write and no 

 others, and are subject to no check or audit : he is apt to be swayed by 

 greed, whether of money, land or power ; he can not consent to lock 

 up his capital for a lengthy series of years, or to receive it back in 

 infinitesimal driblets, indistinguishable from the interest with which 

 they are paid. On the other hand, since it is impossible to trust the. 

 individual money lender with the powers of distraint or other summary 

 recovery, he is put to considerable expense, delay, loss and fraud in 

 the recovery of his ' loans, a loss which he recoups with a handsome 

 increment from his clients, so that the punctual and honourable 

 borrower pays for the offences of the defaulter. 



It is, then, certain that the subs citation of organized credit for 

 that of the money lend er is a necessary development of civilization : 

 the individual system is only an elementary stage which must be 

 eventually passed as general wealth, order, business confidence, and 

 habits of association develop. The questions for consideration are the 

 direction in which such credit shall develop, the means by which 

 it can be encouraged, the modes in which it will work, and the effects 

 which it can be made to produce upon the nation. 



The functions of true credit. It would be out of place to discuss 

 the remedies for the ill plight of agriculture other than that of the 

 organization of credit ; it is permissible merely to point to the lessons 

 of his&ry as teaching the unexpected and indeterminable difficulties 

 of the Asocial problem, even as regards agriculture. Liberty was 

 granted to the feudal quasi-serf by the admirable legislation of VON 

 STEIN and HARDENBERG, with liberty of action as regards the land ; 

 the unforeseen result is the existing mortgage debt of about 

 500,000,000 in Prussia alone. Equality was the revolutionary 

 demand, and equal rights of inheritance a natural and jnst corollary; 

 again the result has been the overwhelming indebtedness of the 



