GOVERNMENT CONTROL OF MONEY. 267 



experience proves that government money is perfectly secured by bonds 

 which citizens can give. The mode of operation might be about the 

 same as that now in practice by the most reliable and successful real 

 estate and loan agencies, except, chiefly, that charges to the borrower 

 shall not exceed what it actually costs to perform the work, which is 

 about one per cent per annum on the amount borrowed. The ex- 

 perience of the best loan companies shows that when considerable 

 amounts are handled, one per cent is ample to pay all expenses. One 

 example may be cited : A well-organized, well-managed Western loan 

 agency has been doing an average business of $2,000,000 annually for 

 some years, with an average force of twenty persons, whose salaries do 

 not exceed $1,000 a year. This is equal to one per cent on the amount 

 of business transacted. A considerable part of the work done by a 

 private company would not be required in a government agency. No 

 outside agents, except examiners, would be required ; and if one 

 examiner were kept in every county, to be transported from place to 

 place by applicants for loans, the expense of that department might be 

 materially lessened. One per cent will pay all expenses of the pro- 

 posed plan as an entirety. The persons in charge of the agency should 

 be strictly business men, not politicians, and appointed on recom- 

 mendation of business men. The superintendent of the central agency 

 might be appointed by the President, and he (the superintendent) 

 should appoint all the local officers, who in turn would employ such 

 assistants as might be needed, subject to approval of the general 

 superintendent. 



This scheme has all been thought out in detail, but there is not room 

 here to give more than a general outline of it. It is altogether practical, 

 simply applying existing methods in an improved plan. Even in the 

 matter of foreclosing a mortgage, the government would be doing no 

 more than it has done a thousand times in the same courts which would 

 have jurisdiction in cases arising under the proposed plan, the difference 

 being only that in one case the parties were both citizens ; in the other, 

 one of them would be the government. Land sold in favor of the gov- 

 ernment would become government land subject to public sale to the 

 highest bidder. 



For loans on personal security and for short time, this plan may be 

 adopted : amend the national banking law so that lawful money, instead 

 of bonds, may be deposited as security for circulation ; let banks with 

 small capital be established in small places, say as low as $15,000 to 

 $20,000, limiting loans to small amounts. No loan shall be made for 

 more than ninety days, charges not to exceed what would be equal to 



