414 BANKS AND MONEY. 



will not cover the payment of about $800,000,000 premium, in 

 gold, to the holders of those bonds in time of peace. 



Language more forcible than elegant, has been used in the 

 meetings of the Western State Agricultural Societies on this 

 subject, and without regard to other burdens of taxation from 

 which the wealth of the country manages to escape. &quot;When 

 the people of the country get to understand how they have 

 been compelled to pay tribute to capitalists, and how the capi 

 talists have controlled the legislation of this country, by brib 

 ery and corruption, and by munificent gifts to men whom they 

 expected to work in their interest when in power; the driving 

 out of the ancient money-changers from the Temple will be a 

 mild affair in comparison with the kicks and cuffs they will re 

 ceive from an outraged people.&quot; 



A low rate of interest, then, is a gauge of the farmer s pros 

 perity. The &quot;New York Merchant and Banker&quot; acknowledges 

 it to be the test of civilization: 



What is the best criterion of the degree of civilization to which a 

 people has attained ? Some promptly answer, &quot;Tha proportion of 

 those who can read and write in the total population;&quot; but this will 

 not serve, for census figures are not always reliable, and literary in 

 struction by no means secures commercial or political intelligence 

 and prosperity. Others will say, &quot;the relative wealth of countries;&quot; 

 but this is very difficult to determine, and if ascertained, the more 

 important inquiry remains in which countries is that wealth in 

 creasing, and where is it growing less ? Others still will name the 

 degree of religious devotion, the extent of virtue, the development of 

 learning, the culture of art and science in various lands; but neither 

 of these is practically available as a standard, since before it can be 

 so applied, it must itself be quantitatively determined. 



It then states that there is, however, a test quantitative in its 

 nature, self -determining 1 , and for the most part readily ascer 

 tained. It is the average rate of interest actually paid for loans on 

 good security. Not, of course, the rate sanctioned by law; for the 

 only relation of this rate to that actually paid, is commonly a tend 

 ency to heighten the latter by increasing the risk of the loan. The 

 rate of &quot;pure interest&quot; does not greatly differ in different countries, 

 and is not far from four per cent. The amounts demanded or offered 

 and actually paid for loans above this rate, consist mainly of premi 

 ums of insurance on the risk the lender considers himself to take 

 when he puts his property out of his possession. When it is re 

 membered that confidence is a plant of slow growth; that it is devel 

 oped by long experience, and very quickly and easily destroyed, and 

 that its development to such a point that premiums on risks of loan 

 are nearly nothing, means that commercial practice and legal ad 

 ministration have convinced property-holders by experience that 

 their property is secured to them through business honor or through 



