Tuesday, August 29, 2006
Sunday, August 27, 2006
I've been working on indexes of Hall's radical fables and parables--no small feat, since he published everywhere from St. Nicholas to the American Journal of Eugenics (the continuation of Lucifer, the Lightbearer.) The list is over 250 titles long now, and I'm not even through compiling what I have in hand. I've also started work on a project pulling together "all things Bolton Hall" from the pages of the New York Times, literally hundreds of letters to the editor, bits of biographical detail and records of political involvements.
Other posts on Bolton Hall:
Thursday, August 24, 2006
So, why all the question marks, qualifications, and "i think..."s? The 1891 Citizen's Money includes, on the title page, this interesting line:
the Sociedad Las Clases Productoras.
This probably refers to the 1886 edition of The Financial Problem, which has the phrase "the principles of monetary science" in its subtitle. But there may be a good deal about Alfred Westrup we don't yet know. Westrup's involvement with the Sociedad Las Clases Productoras is a mystery yet to be unravelled. An Alfred Westrup was involved in supplying telephone service to Mexico (roughly December, 1878), and an Alfred B. Westrup shows up in the records of the American and Foreign Christian Union. (Westrups show up as Southern Baptist missionaries in Mexico, and one was "killed by Indians" in that service.) Correspondence with an Alfred B. Westrup (almost certainly "ours") shows up in the Augustin Frédéric Adolphe Hamon Papers.
NOTE: Those attempting to follow Westrup's debates in Liberty via the APS online collection will find that at least one piece of the puzzle is missing. The APS collection is incomplete, and lacks the issue (v.6, iss. 1; Aug 18, 1888; #131 in the LMP microfilm edition) containing J. Herbert Foster's initial response to Westrup. The article is "Shall the Transfer Papers be Taxed?" and it includes a response by Tucker. I'll try to get the letter scanned and online.
Tuesday, August 22, 2006
[I posted an earlier version of this yesterday, but a computer glitch devoured a couple of hours of bibliographic work. Here is an complete version, with the lost material restored and some additions.]
The other new text is Citizens' Money, a pamphlet based on a talk given several times by Westrup, which was also published in Liberty. See the bibliography below for citations and links.
- The abolition of interest a simple problem: the pending crisis the death struggle of a moneyed aristocracy and the labor pains of a new birth to industry. New York : M. Hill, 1879. (18 pages) [transcription in progress]
- Address on a new system of money: given at the Chicago chapter of the American Institute of Banking : held in the Northwestern University Building, May 23, 1916. [Chicago? : s.n.], 1916.
- Citizens' money, a lecture on the "National banking system." Delivered in Chicago and published in "Liberty," of Boston, in 1888. San Fran: Equity publishing co, 1890. (21 pages)
- Citizens' money, a critical analysis in the light of free trade in banking a lecture by Alfred B. Westrup ... delivered in Chicago, Sunday, June 3, 1888, and in Toledo, O., under the auspices of the Society for Economic Inquiry, Feb. 19, 1891. Chicago: Mutual Bank Propaganda, 1891. (27 pages)
- The Financial problem, its relation to labor reform and prosperity :the principles of monetary science demonstrating the abolition of interest to be unavoidable. Chicago : Mutual Bank Propaganda, 1891. 2nd ed. Dallas, Tex. : Pub. by the author, 1886. (32 pages)
- ---. 3rd ed. Chicago : Mutual Bank Propaganda, 1891 (30 pages)The new philosophy of money: a practical treatise on the nature and office of money and the correct method of its supply. Minneapolis: F.E. Leonard, 1895. (192 pages)
- ---. 2nd ed. Chicago : B. Canode, 1915. (174 pages)
- Plenty of money. A new and scientific plan by which credit in the form of paper money is provided and substituted for credit in the form of goods. New York, L. Weiss & Co., printers, 1899. (13 pages)
- Plenty of money (a synopsis of the "New philosophy of money"): A new and practical plan by which secured credit in the form of paper money is provided and substituted for unsecured credit in the form of book accounts. 2nd ed, rev. Chicago, Ill., 1915. (28 pages) [with Mrs. Maud Denning Westrup]
- Sex slavery: an essay presenting some practical helps for the perpetuity of happiness after marriage, the borning of better babies and how parents should deal with their children regarding the question of sex in accordance with the doctrine of egoism. Chicago, U.S.A. : By Alf. B. Westrup, 1914. (39 pages)
- Tucker, "On Picket Duty," Jul 17, 1886. Vol. 4, Iss. 6; p. 1
- Tucker, "On Picket Duty," Jul 7, 1888. Vol. 5, Iss. 24; p. 1
- Westrup, "The National Banking System," pt. 1, Jul 7, 1888. Vol. 5, Iss. 24; p. 7
- Westrup,"The National Banking System," pt. 2, Jul 21, 1888. Vol. 5, Iss. 25; p. 7
- Westrup, What Mutual Banking Would Do. Sep 15, 1888. Vol. 6, Iss. 3; p. 5
- J. Herbert Foster, "Money and Capital," Dec 1, 1888. Vol. 6, Iss. 8; p. 4
- Westrup, "Mutual Money," Jan 5, 1889. Vol. 6, Iss. 10; p. 5
- Tucker, "On Picket Duty," Jan 5, 1889. Vol. 6, Iss. 10; p. 1
- "Mutual Bank Propaganda," Aug 10, 1889. Vol. 6, Iss. 19; p. 6
- Tucker, "On Picket Duty," Dec 28, 1889. Vol. 6, Iss. 23; p. 1
- Tucker, "On Picket Duty," Sep 27, 1890. Vol. 7, Iss. 12; p. 1
- Tak Kak, "Sentimental and Incomplete," Mar 7, 1891. Vol. 7, Iss. 23; p. 1
- Tucker, "On Picket Duty," May 16, 1891. Vol. 8, Iss. 2; p. 1
- Tucker, "A Standard of Value a Necessity," Jun 13, 1891. Vol. 8, Iss. 4; p. 2
- Westrup, "A Necessity or a Delusion,--Which?" Jun 27, 1891. Vol. 8, Iss. 5; p. 2
- Tucker, "On Picket Duty," Jun 27, 1891. Vol. 8, Iss. 5; p. 1
- J. Greevz Fisher, "Free Trade in Banking," Jul 11, 1891. Vol. 8, Iss. 6; p. 3
- Tucker, "On Picket Duty," Aug 8, 1891. Vol. 8, Iss. 9; p. 1
- Galveston News, "The Essentials of Sound Money," Aug 8, 1891. Vol. 8, Iss. 9; p. 1
- Fisher/Tucker, "The Equalization of Wage and Profit," Aug 22, 1891. Vol. 8, Iss. 11; p. 2
- Tucker, "On Picket Duty," Sep 5, 1891. Vol. 8, Iss. 13; p. 1
- Galveston News, "How Much Can Be Loaned?" Sep 12, 1891. Vol. 8, Iss. 14; p. 3
- Galveston News, "No Misrepresentation," Oct 3, 1891. Vol. 8, Iss. 17; p. 4
- Tucker, "On Picket Duty," Oct 3, 1891. Vol. 8, Iss. 17; p. 1
- Memphis Commercial, "Another Editor Favors Free Banking," Oct 31, 1891. Vol. 8, Iss. 21; p. 1
- Tucker, "On Picket Duty," Oct 31, 1891. Vol. 8, Iss. 21; p. 1
- The Jeffersonian, "A Notable Exception," Jan 2, 1892. Vol. 8, Iss. 30; p. 4
- Victor Yarros, "Mutual Bank Notes," Feb 6, 1892. Vol. 8, Iss. 35; p. 2
- Tucker, "On Picket Duty," Jun 4, 1892. Vol. 8, Iss. 42; p. 1
- Westrup, "Was the Money Question Dodged?" Jun 4, 1892. Vol. 8, Iss. 42; p. 3
- "A Letter from Mr. Westrup," Aug 6, 1892. Vol. 8, Iss. 50; p. 3
- "Mutual Bank Propaganda," Jul 14, 1894. Vol. 10, Iss. 5; p. 8
- Henry Seymour, "The Standard of Value," Oct 6, 1894. Vol. 10, Iss. 11; p. 3
- Henry Seymour, "The Standard-of-Value Controversy," Oct 5, 1895. Vol. 11, Iss. 11; p. 5
- Stephen T. Byington, "Anarchist Letter-Writing Corps," Mar 21, 1896. Vol. 11, Iss. 23; p. 5
- "Let Us Emancipate the Race!" The North American Review (1821-1940). Boston: Jul 1918. Vol. VOL. CCVIII, Iss. NO. 752; p. 159.
- The Auditor. Chicago, Ill.: Auditor Pub. Co., 1891[?] [free banking journal edited by Westrup. Copies of at least some issues are in the Labadie Collection, UMich.]
Monday, August 21, 2006
Tuesday, August 15, 2006
A Southern Prophecy: The Prosperity of the South Dependent upon the Elevation of the Negro, originally a series of essays in The Independent, June-July, 1887. Blair's anti-protectionism was of the sort to warm the heart of an anarchist. In his writings on "special legislation" he takes the approach of encouraging farmers, his primary audience, to repeal all the legislation they can. He appears to have been close to Westrup's position regarding the "standard of value" question. In the essay that follows here, he makes a very interesting set of arguments for the free currency position. I'm working up a "selected writings" collection of Blair's writings, which I hope to post soon.
RIGHT OF INDIVIDUAL TO COIN MONEY
Slightest thought should show the injustice and absurdity, and therefore injury of such prohibition; but as some cannot think, and many will not think, these perceive neither the injury, injustice nor absurdity, and as the few who do think qualify their perceptions With so many imaginary and impossible fears they might as well not think. Hence, all unite in preventing individual doing as he pleases with his own, respecting coining money and issuing circulating promises to pay. All fear to permit right and leave consequences to righteous nature, lest nature stultify herself and bring evil out of good.
To prevent right is to commit wrong. Now, what is government that it can righteously prevent one doing as one pleases with one's bullion and putting one's property into such shapes as one pleases? Government is not, as generally supposed, a mysterious, omnipotent creature whose simple fiat makes right and wrong, but is merely an aggregate or collective individual. Aggregation of individuals into government does not impart to the aggregate a different nature from its component units, nor rights different in kind, however in degree, from said units—no more than aggregation of seeds of wheat until they fill an elevator changes the nature of the grain. Government differs from the individual only as the grains from the mass—that is, in degree not in nature. How, as righteous individual cannot arbitrarily prevent individual doing as he pleases with his own, so neither can the aggregate individual or government righteously prevent its individual units. Or, if the aggregate can righteously control its individual units respecting coining money and issuing circulating promises to pay, and should do so, so can and so should it in every respect; unless, indeed, government is not an aggregate individual, or that mere aggregation confers rights or a nature unpossessed by its component units.
But the aggregate individual or government forbids the exercise of individual right in these respects on the ground of trespass, assuming that worthless money would then "flood the country," that people, not knowing good from bad money, would refuse to accept it; that business would be stopped and ruin follow, or that if accepted, that all, but especially the ignorant poor, would be daily swindled—every man being either swindler or swindled, and finally all swindlers. Why such direful results should follow, the exercise of a simple right can only be explained on the ground that people are either imbecile or dishonest. Let us examine the objection.
It is undeniable that checks, which are entirely of individual coinage (coinage being simply putting into convenient shape for circulation) are money; that checks do vastly more monetary work than all governmentally-coined specie and notes and corporation-coined notes, and that checks are vastly more essential to progress and welfare than specie and notes. Money in its conventional sense of specie and notes might be obliterated, and commerce would hardly miss them; because commerce is mainly conducted by individually coined and issued money—namely, checks. Indeed, in August, 1393, conventional money—viz., specie and notes practically disappeared, yet business, judged by bank clearings, vas not greatly curtailed, and the curtailment arose from distrust and not from insufficiency of checks. Melt every government coin and strike never another, burn every governmentally-controlled note and print never another, and leave money to individual initiation and control, and then, but only then, will cease the interminable dissensions about money because public convenience will then see that money will always be proportioned to the needs of business.
Now if the poor and ignorant have not been swindled by this individually coined and issued money—namely, checks—if the public has received it freely to its advantage, and if without this individually-created money progress would have been impossible and decay inevitable, why should untold—why, indeed, should any injury result from extending individually-coined and issued check-money to individual coining his own bullion, and to individual putting his own property into a circulating shape. Conversely as unrestricted issue of checks has enormously increased human welfare, why should not farther extension to unrestricted coinage of one's bullion and unrestricted putting one's property into circulating shape still further increase human welfare? It would, but unfortunately we forbid. But prevention having lamentably failed, because monetary solution is confessedly as remote as ever, liberty cannot be worse. Let us, therefore, try liberty, and as liberty has assured success in all other business, we may rely upon it assuring success in coinage and currency. Let us look further.
Assuming imbecility and dishonesty as usually done, but ordinary common sense, no more embarrassment nor damage should result from individual coinage than from individual checks. We know neither the weight nor fineness of governmental coinage, but we accept it from general appearance, and seldom are even the poor and ignorant deceived; and so would it be with individual coinage, and inexpensive scale and gauge would easily allay doubt. Really, however, governmental coinage, except our silver coinage, is private coinage, because the bullion is owned by and coined for the individual, and the government that made it repudiates it if clipped, sweated, worn by use, or defaced by simple device or even letter, and individual to avoid loss must be watchful, but he need be no more watchful regarding individual coinage. Whatever teaches watchfulness is beneficial. But watchfulness, like all habits, would become automatic, and would be practiced without effort. Fools pass on and are punished because not watchful, while the wise pass over the same route and are rewarded because watchful. Insomuch as individual coinage promotes watchfulness will it be beneficial.
"But individual coinage would bewilder and betray by its variety." By no means; because, though every one could and might coin of different weight, fineness, shape and device, yet it is improbable that coins differing much from present coinage would be struck. Public taste and convenience which has determined dollars for us, sovereigns for Englishmen, francs for Frenchmen, &c., and a circular shape for all, would settle that. As stated, we would judge individual coinage as we now judge governmental coinage, by appearance, but scale and gauge would assure certainty, because if scale registered correct weight and gauge correct size, there could be no deception. Owing to great expense of a mint, there would probably be few or no individual coins, but bullion-holders would carry their bullion to corporate mints just as holders of ore send their ores to corporate smelters for refining.
But why not let coinage remain under governmental control? Because governmental control is trespass against the individual; because government should no more supply coinage than food, clothing, vehicles, or even wives; because government has no more right to forbid its component units to put bullion into coin than wheat into flour or cotton into cloth, &c., &c., and because when government punishes the individual for so doing it becomes as real a malefactor as highwayman who holds up train.
Individual coinage would promote public and private morality, because circulating by virtue of intrinsic value and not by virtue of force, it would destroy "legal tender," always possible and sometimes actual robbery. Legal tender is a perpetual menace to honesty and a perpetual temptation to dishonesty, and individual coinage, removing both menace and temptation, would, as stated, promote morality. Legal tender is substantially a device whereby creditor may exact more or debtor pay less than is equitable. The strength of silver legislation has been legal tender. Free coinage was demanded because legal tender would permit payment in an inferior medium, and free coinage was resisted to compel payment in a superior medium. But for legal tender, the Bland bill, the Sherman bill, and silver agitation and legislation, the cause of untold injury, would never have been. The monetary problem will remain unsettled so long as legal bender stands in the way. Legal tender should be may, not must. That is, government may prescribe what, in the absence of stipulation, shall be legal tender. For example, government might enact that "bankable funds" should, in default of stipulation, be legal tender.
Individual coinage would always assure specie "commensurate with the needs of business," because then both silver and gold would circulate freely, side by side, at market value. With compulsory legal ratio they cannot circulate freely, and thus the world loses the services, partially at least, of the metal that chances to be dearest. Except with us, the world is now deprived of the use of silver, but we use silver at great peril, because its legal tender value is so much greater than its bullion value that creditors are constantly exposed to spoliation from inability to maintain the legal ratio. The fear of this inability principally caused the unparalleled financial and commercial disaster of 1893. Specie would then fluctuate in value with its parent bullion, like flour with its parent wheat, but no more inconvenience would arise from one than from the other. In spite of legal tender, however, specie does and must in the long run fluctuate with bullion. Prices would then be in gold' silver or currency, or indifferently in all or either, just as, before resumption, prices were in gold or currency. Standard coins would likely bear present names and general appearance, and would always mean a definite weight and fineness, and any variation above or below standard would be settled by custom, like cotton contracts are, namely, a contract for a stipulated quality may be satisfied by grades above or below contract by paying or receiving a specified difference. Custom would solve all difficulties arising from individual coinage.
The fear of "wild cat" banking is chimerical. No analogy exists between now and fifty years ago when people were defrauded by "yellow dog" notes, &c., though by no means to the extent charged and supposed. Then in the greater part of the country specie was almost unknown, and what we had was mostly slick Spanish quarters, ninepences and fourpences, and even these were scarce; so the people had to use risky currency. But now gold is to be had for the asking and silver goes a-begging, and therefore no necessity exists for accepting any note. Say "No" and specie is at once forthcoming. If people wish to be defrauded they will find now many to accommodate them, but it would be no worse under individual than under governmental issue. No law can protect such people, either then or now.
Individual issue would prevent currency famines with their inseparable disasters. Thus could person or corporation have issued notes last summer, they could, as circulation was withdrawn, have supplied the vacuum, and they would have done so, because every locality would have paid handsomely for the issues of its banks or wealthy citizens; but because this natural right was forbidden, currency disappeared, most banks were virtually under protest, and general bankruptcy was averted only by forbearance of creditors. Indeed, currency would not have been withdrawn if known that it could have been replaced by individual issue.
While bank issues would generally be preferred, there are many times, places and occasions when individual issues would be useful. For example: For six months each year there is almost complete dearth of money throughout the South, and all business is thereby curtailed and much business stopped. Now, every town has some bank, banker or individual whose issues at such period would readily circulate in its neighborhood, and all or many localities doing the same, there would then be a satisfactory local circulation supplying local needs as effectually as greenbacks or specie. If no demand, there would, of course, be no issue, but if a demand, it would, of course, injure to prevent the demand being supplied. Such issues being strictly local, the people would not likely lose by fraud or recklessness, because they would know who were reliable or reckless, and would therefore be forearmed. The South now pays Northern bankers heavily for money to move its cotton, &c. These local issues would lessen, if not altogether stop, this heavy expense. In the autumn, when greenbacks and specie sought the cotton, these issues would be retired or not, according to public convenience. As acceptance of individual issues would he optional, they could circulate only as found useful. To prevent their issue is therefore a public injury. To prevent all but governmentally-controlled corporations to convert cotton into yarns or cloth or wheat, into flour, and then arbitrarily to restrict production and make it a grave crime for individual or unofficial corporation simply to have in possession spindle or loom or burr, would be justly considered not only an injury, but a crime. But Government commits a similar injury and crime when it arbitrarily regulates banks and restricts their issues and makes individual possession of die or plate, and much more their use, a crime. To prevent right is to commit wrong, and to prevent the useful is to produce injury. When, therefore, Government prevents individual right to coin money and issue notes it becomes a trespasser, an evil-doer, and when it prevents individual from doing these useful things (if not a public convenience it could not be done) it injures the public. Nature resents and punishes interference, and to prevent exercise of individual right of coining and issuing notes is interference with nature.
* A crossed check is similar to our checks marked "Payable only through Clearing-House.'' The holder cannot draw the money. It must be deposited.
Sunday, August 13, 2006
The link above is to an electronic copy in the Gallica collection. Use the "télécharger" button to assemble a complete pdf file or download it in chapters from Northwestern's "Homicide in Chicago" pages, which also feature a nice selection of related newspaper articles, photographs and illustrations.
Friday, August 11, 2006
Westrup is first mentioned in the pages of Liberty on July, 17, 1886. In the "On Picket Duty" column, Tucker writes:
There are some interesting details here, not the least of which is that The Financial Problem is not Westrup's earliest publication. Some additional OCLC digging clarifies things a bit. One of the records notes that the pamphlet was: "Originally published as pamphlet, 1879, under title: The abolition of interest, a simple problem." OCLC lists no 1879 publication of The Abolition of Interest, but does list an 1897 edition, 18 pages long. It seems unlikely that Westrup, having revised the work, and enlarged it to 30 pages, would have reprinted this version six years after the publication of the 1891 3rd edition (again, under the title The Financial Problem) and two years after publishing his magnum opus. It seems most likely that the 1897 date is a typo.
Alfred B. Westrup, of Dallas, Texas, has issued a second and revised edition of a pamphlet published by him several years ago. Its new title is "The Financial Problem: or, the Principles of Monetary Science." The views are practiacally the same as those set forth by Colonel Greene in his "Mutual Banking," but Mr. Westrup has formualted them a little differently. He realizes the superlative importance of the money question, and has gone to the bottom of it. Any one may secure this pamphlet by forwarding twenty-five cents to Mr. Westrup, his address being simply "Dallas, Texas." The Galveston "News," which advocates with marvellous clearness and ability the financial system proposed by Greene and Westrup, makes a rather trivial criticism upon Mr. Westrup's statement that "interest upon money loaned on good security is irrational," seeming to suppose that he applies the adjective "irrational" to the conduct of borrowers and lenders under present financial conditions. Mr. Westrup's meaning clearly is that interest upon money loaned on good security stamps as irrational the monetary system which makes it possible.
Tucker next notes (July 7, 1888, "On Picket Duty") that:
A. B. Westrup's lecture on "The National Banking System," begun in this issue, was given in Chicago, in reply to Banker Lyman B. Gage's defense of that system at one of the "Economic Conferences" held in that city, and made a marked impression.Westrup's lecture, which was reprinted several times in pamphlet form (see my original bibliography), was also the basis of the pamphlet Citizens' Money (1890, 1891). Liberty ran it in two parts (July 7 and 21) in 1888.
The original occasion for the lecture was the "Economic Conferences between Business Men and Working Men," held in Chicago, and covered in some depth by The Open Court. The August 1888 Unitarian Review listed the following topics announced for presentation:
- The Aims of the Knights of Labor, George A. Schilling.
- Banking and the Social System, Lyman J. Gage.
- The Labor Question from the Stand-point of the Socialist, J. Morgan.
- Is the Board of Trade Hostile to the Interests of the Community? Charles L. Hutchinson.
- A View from the Labor Sanctum, Jos. R. Buchanan.
- Socialism as a Remedy, Franklin MacVeagh.
- An American Trade Unionist's View of the Social Question, A. C. Cameron.
Meanwhile, back in Liberty, J. Wm. Llloyd mentions Westrup's lecture (Sept. 15, 1888), and Westrup published a letter, "What Mutual Banking Would Do," in the same issue, reponding to J. Herbert Foster. This short exchange marked Westrup's entry into the controversies of Liberty's letters pages, where he would be a major player in the "standard of value controversy," starting in 1891. Out of those debates would develop the more mature form of his mutual currency theory, which is presented in full in The New Philosophy of Money. That volume resembles Tucker's Instead of a Book and Greene's Fragments, consisting of collected controversies, previously published material, and new writings, but it is arguably much more coherent than the other works. I'll be posting on online edition of that soon, but as a sort of taster, I'm posting Plenty of Money, the introductory text which Westrup and his wife prepared in 1899. Once I get a chance to collate the items reprinted in The New Philosophy of Money against the original letters and essays, I'll start collecting the otherwise uncollected bits.
Thursday, August 10, 2006
"For always in thine eyes, O Liberty!
Shines that high light by which the world is saved;
And though thou slay us, we will trust in thee." JOHN HAY.
The Capital Controversy.
I consider the question of the status of money—whether money be capital or not—as of very great importance. It is because money has been generally regarded as a form of wealth that interest seems to have a real justification. Once let it be understood that money is not a thing, but a system, and many of the misconceptions circumscribing the subject will be dispelled.
Money is a labor-saving system of book-keeping. It is a convenient modus of keeping account of credits.
A merchant's books are not wealth; hence they cannot be capital. They are memoranda of wealth which he has agreed to deliver and which has been agreed to be delivered to him The books are merely aids to his memory. When a merchant deplores the "credit system," it is really the complicated book system he has in mind. The less complex system of credit by certificates insured by a good bank would be satisfactory to him, without doubt.
There are two ways in which commerce can be conducted. One is exchange of commodity for commodity,—barter. The other is exchange of commodity for credit, and, if the credit take form,—as, for instance, the form of certificates insured by a bank,—money.
Money is an evidence of debt. If the debt be well secured, and the certificate of the debt be so drawn us to carry forceful conviction that it is well secured, then such evidences of debt will pass from hand to hand in exchange for wealth, and such certificates of debt will be money.
Money is a labor-saving device for the facilitation of exchanges. It avoids the need of sending the wealth along with the promise to exchange or deliver wealth, or services. When a certain bulk of bullion is fashioned into the shape of coin (indicating the quantity and value of the metal so coined), the shape and size of the coin is the money, and the metal is the wealth which is sent along with the shape to prove its worth.
The money issues of a cooperative bank do not perform the function of gold and silver coin. They better perform the function which gold and silver coin was designed to perform.
Credit is not a thing. It is a quality. It is a part of the intelligence of mankind and inheres in man himself.
One's credit is a part of himself. It is his credibility. If he have "good credit," his promise to deliver wealth or perform labor will be believed, and, if the promise be in writing; it will be money with a limited extent. If the maker of the written promise be known to have accumulated property, the money will be better money and circulate somewhat more widely than if he had no property. If he pledge his wealth,—pledge himself to deliver his wealth at some future time in the event that he cannot otherwise redeem his promise,—there will be a further improvement in the quality of the money. But if he mortgage his wealth to a bank, and the bank accepts his written obligation to give up his wealth in the event that he cannot otherwise meet his promise, and if the bank thereupon issues its own notes to him in exchange for his notes, then there is issued the best form of money, because it is the best system of utilizing credit. This money will circulate wherever the bank is known to be a conservatively managed institution issuing no notes except upon the faith of ample security pledged to be delivered in case of certain contingencies.
The editor of Liberty has said: "The bank performs the same service that is performed by the registry of deeds office in the case of land transfers,—that of making the title more secure in the eyes of the parties interested or liable to become interested." I agree to this. But the certificate issued by the registrar has none of the power or capacity of the transferred land. The certificate is merely a certificate, after all. And the same is true of the credit certificates issued by the bank. The bank here occupies the position of an insurance company. It assures all men that its notes are based upon tangible property worth considerably more than the amount of the bank-notes issued to the mortgagor. The money is somewhat similar to a policy of assurance. The policy is not the paper upon which the guarantee is inscribed. The paper is the durable form upon which the guarantee is recorded It is the guarantee of the bank which is the money.
You say: "In reality the money is not the paper, but is the monetary power or function or capacity naturally inhering in the wealth which the paper represents." I contend that there is no monetary power inhering in wealth. Whatever there be of such power inheres in man. It is the power or sagacity to make exchanges on credit, and the credit in turn is based largely upon the known ability of the debtor to meet his obligations. He gives the bank such security us warrants the bank in giving assurance of security to all the world, and the bank's certificates (money) are the tangible forms of this assurance.
The discovery that the possessor of wealth could inspire his neighbors with confidence in his credit was not in itself an addition to the wealth of the world. It is true that the discovery tends to overcome the wastes, inconveniences, and labor incident to barter, and thus will liberate some labor from that form of service, allowing it to be utilized in other directions. But the discovery of the process was merely an advance in human sagacity, and, being a part of man himself, it cannot be classed as wealth. Nor is wealth used in the transaction of credit. It is only used in case the debtor fails otherwise to redeem his promise. In fact, the chief value of credit over barter lies in the fact that the use of the wealth is obviated.
"Monetary power" is a term which cannot be used as applying to wealth without ascribing to wealth some such metaphysical qualities as matter-of-fact commerce has never yet recognized. Unless the symbol may be said to be "the soul" of the thing symbolized, I cannot conceive of any such power inhering in a thing If it were at all proper to regard the symbol synonymous with the thing, then money may be truly said to be debt. since money is really the symbol of debt.
Many of the social injustices which stand between man and his comfort have their origin in the superstition that money is "the soul of wealth," and that wealth has a monetary power a which can live apart from the body.
There is no such process possible as the monetization of wealth, except by barter. There can be monetization of credit. It is the monetization of credit for which the advocates of the mutual bank should contend.
One of my objections to the terms of your syllogism (the one most particularly applicable to this controversy) is that at money is not a thing.
Monday, August 07, 2006
I had previously read Campbell's The true greenback : or the way to pay the national debt without taxes, and emancipate labor (1868), which appears as an appendix to the 1971 A. M. Kelley reprint of Kellogg's Labor and Other Capital, and both works are of much the same character. Kelloggism retained Kellogg's theory of the nature of money and his emphasis on the right of government to regulate interest rates, but maintained almost none of the practical features of his Safety Fund. This seems to be true of William Sylvis' adoption of Kellogg's ideas as well. (See his "What Is Money?") We know that Ezra H. Heywood flirted briefly with these ideas during his affiliation with the National Labor Union, but greenbackism was generally pretty far removed from the labor notes and mutual banks of the mutualist and individualist anarchist traditions.
Friday, August 04, 2006
Wednesday, August 02, 2006
The archive is in the familiar Making of America format, so you'll have to page through things. Plain text is available, and relatively well edited, so the archive ought to be usefully searchable.
I'll treat both of these figures in more depth soon...