332.4973 N 377/m
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NORTHWESTERN
UNIVERSITY
LIBRARY
EVANSTON
ILLINOIS
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'om the Rational papmers' Alliance
TO THE
Honorable the Congress
op THE
UNITED STATES.
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MEMORIAL
To the Honorable the Congress of the l'm ted States:
Your Memoralists, citizens of the United States, and delegates
to the National Farmers' Alliance in Annual Meeting assembled, re¬
spectfully represent:
That the present economic and financial condition of the
£o"ntry is anomalous, inasmuch as, while the production of wealth is
unprecedented, the condition of the producers of wealth is not im¬
proving, but is on the contrary retrograding. While no period has
"Witnessed a greater aggregate increase of wealth than the past
twenty years, at the same time the farmers of the country are
sinking deeper and deeper in debt. It is becoming rare to find farms
which are not mortgaged, tenant farmers are rapidly increasing, and
failures of country merchants are becoming more numerous day by
day.
In addition to this private indebtedness there is a corporate and
municipal indebtedness which is of appalling magnitude, and which
causes a further exhaustive drain upon the energies of our people.
While the farmers of the country are becoming involved in debt,
the artizans and laborers are finding the conditions of life harder.
Many are idle, many are working on reduced time, and poverty and
distress were never more common in our land than now. This causes
dissatisfaction and strikes, often riots and bloodshed, exasperates em¬
ployers, and continually widens and deepens the chasm between labor
and capital, which ought to have no existence.
On the other hand, forced by a continually narrowing margin of
Íirofit to reduce expenses and secure safety for investments, manufac-
urers and dealers are driven to combine to accomplish these ends,
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and trusts which seem pernicious and tyrannical are formed. Mean¬
time there are two classes of men who seem above-the reach of adverse
financial fortune, money lenders and railroad owners. Of these the
former are leaping a harvest of wealth unprecedented in the history of
the world.
While we do not wish to complain of the prosperity of any class,
we believe that the prosperity of a state is measured by that of all its
people instead of a few of them; and that any nation is surely on the
road to decay where a few handlers of wealth absorb the greater pro¬
portion of its productions, while its producers remain stationary or
grow poorer.
Your Memorialists believe that as these disorders are financial in
their character, their causes may be found in the financial system of
the country.
First, the volume of the currency furnished by the government is
insufficient to transact the bu iness of the country upon a cash basis,
and the people are therefore forced to do it upon a credit basis. This
must be apparent at a glance
In 1865 we had about $1,900,000,000* currency of all kinds in
circulation; we had only 31,000,000 of population, of which 10,000,-
000, people of the southern states, were then just beginning again to
use our money. We were then doing business upon a cash basis; we
were free from debt and prosperous. We were in that condition in
spite of an exhaustive war and solely by virtue of the volume of cur¬
rency made necessary by the war. We have now of all kinds of money
less than S i,600,000,000. We have over 60,000,000 of population
instead of 31,000,000, and our annual production, by virtue of our
extended agriculture and the increased use of mechancial appliances,
is three times what it was than, thus making a relative decrease of
two thirds in our money volume. We are now universally in debt,
only a few of our people are prospering, and they at the expense of
all the rest. It is obvious from this comparison that the great evil is
a restricted volume of money.
Your Memoralists believe that to restrict the currency of a people
toan amount insufficient to transact its business operates solely to the
Note.—Total circulation in 1865: State Banks, $142,919,638; Demand
notes, $472,603; One and Two Year notes of 1863, $42,308.710: Com¬
pound Interest notes, $193,756,0S0; Fractional Currency, *25,005,828; Na¬
tional Bank notes, $146,137,860; Legal Tender notes, $431,066,428; Coin,
$400,000,000; Temporary loan, redeemable on ten day.-«' notice, after thirty
davs, bearing 4 to 6 per cent interest, and paid out by the Treasury on current
account, and entering into the circulation, $400,000,000 to $Soo,ooo,ooo.
advantage of the money-lending class, and is diSas'tVoîis'tb âll^'other,
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Money possesses two powers which are of .transcen'dent import¬
ance,—the power to fix or measure values, and the power to accumu¬
late by interest. It is an accepted financial law that the value or
price of property or products maintains a certain fixed relation to
the amount of money available for circulation. With a skrinking
vertone of money values skrink, and vice versa. This law applies to
'all accepted money. A shrinkage in the volume of accepted paper
jcurrencies has the same effect upon prices, productive industry and
prosperity as a shrinkage in the volume of metallic money. This
shrinkage may be absolute or it may be relative. An increased
population, with a p:oportionately increased volume of business, and
the volume of money stationary, would have the same effect as the
ibpMÉage f the volume of money with production stationary.
Money being the instrumentality by which commodities are ex-
d,an inadequate volume of it means stagnated trade,low prices,
diminished reward for labor, restricted production, and an increase
of the weight of existing obligations.
This power to fix values, and the power to accumulate by interest
are the qualities which give money control over labor and production,
and enable the money lenders to accumulate in their hands the greatest
share of produced wealth.
The depression of prices and the growing indebtness of the country
have been continous since the effort to bring the basis of our money to
¡the single gold standard began—in short since the contraction of the
currency relative to production began. This depression must con¬
tinue and must be aggravated, as long as this relative disturbance con¬
tinues. Prices are only the expression of the relation of money and
ether things, and there is no botton to prices as long as money may
row Relatively less in volume. The present economic situation is
imply the logical result of the change in these relative conditions
r'hich (has been going forward for the past twenty years. A greatly
increased population, and production, a diminished volume of cur¬
rency; a continual depression of prices and values, a constantly swell¬
ing volume of debt, the depression of labor, a clogging of demand re¬
sulting in so-called overproduction,and a prodigious golden harvest of
interest.
. Ymiq^/emónhliifft invite your attention to the pregnant fact that
Jttri£i*s M £w>»lu<its measure the reward of labor and the vulue of inter¬
est. As" ¡.." ire's* shrink the reward of labor diminishes and the value of
interest increases. Thus while production brings to the debtor less
reward, interest commands more of his products. Hence in both
directions is the indebted producer scathed, while with every succes¬
sive fall in prices the money lender commands more of the proceeds
of his labor.
The prodigious concentration of wealth in our cities, and in few
hands, is also the logical outgrowth of this depression of prices,
coupled with the accumulative power of interest. To illustrate! this
absorption, take for example our four thousand million of watered rail¬
road securities, which bear about 4 per cent interest. Allow 3 per
cent, reloaned semi-anunally, and the principal wdl double in 23^
years. Say 24 years, and carry the computation forward for 120
years, and we have the enormous sum one hundred and twenty-eight
thousand million—twice and a half the value of all the property of
the United States.
Take the $ r^yuua;000 on the farms of "Nebraska at 7 per i cent
interest, which is less than the interest actually being paid. Reloaned
semi-anunally it doubles in ten years. Carry the computation for¬
ward 50 years, and the prodigious sum of four thousand eight hundred
millions is produced.
Your Memoralisfs respectfully represent, that the depressian "in
prices, stagnation in trade, recurring labor troubles and increasing
debt, can only be arrested by a larger supply of money relative to
production; and that this end cannot be secured under the present
system by which the government furnishes money to the people, ¡¡-
Money is loaned by the government on the security of U. S.
bonds, at cost of issue, to a small class of citizens, who reloan it to
the people at exhorbitant rates of interest. It is difficult to see any
necessity for the intervention of this small class between the govern¬
ment and the people. It is also difficult to see why bonds, which
are variable in quantity and value, and which may have their value
greatly impaired by a public calamity, should be preferred as security
to land, which is invariable in quantity, of less changing value, and
forms the basis all production.
Land is the ultimate and natural security for all money. Whether
borrowed by the banker, merchant, manufacturer or farmer, its secur¬
ity and interest for its use must be found in the productions of land
and labor. This being the case, ) our Memoralists consider the loaning
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iiÉbney direct to the people, on land security, at cost of issue, a more
just and equitable way of putting money in circulation than the pres¬
ent method,
Your Memoralists would further respectfully represent that this
injustice underlying our monetary system—the monopoly of our
money by a small class, and the accumulative power of interest—
really underlie most of the complaints which comprise what is termed
the labor question. Interest is the basis of rent and transportation
charges, and largely determines the wages of labor in our factories
and mines. It will be seen that it forms a burden from which no
man can escape. That freedom from debt gives immunity from it is
a delusion As long as credit is the basis of our business every con¬
sumer must bear his share of the unnecessary burden.
In a couivry where all are theoretically equal any great injustice
in the statute book cannot fail to cause discontent and breed social
disorder. How much greater this effect when the injustice is so great,
and so closely connected with our daily labors and needs.
Your Memoralists therefore most humbly pray that your honor¬
able body will "-1"!'1 ;i'l to asking thto-h^dy to,
issue an increased volume of money, to be issued direct tothe peopleon
land security, at a low rate of interest, to the end that an adequate me¬
dium for the exchange of commodities may be had, the prices of
products and labor increased, prosperity restored to the people, and
the burdens of debt and interest gradually removed.
And your Memorialists will ever prav.
Signed on behalf of the Alliance by
J. Burrows, President.
H. L. Loucks, Vice-President.
August Post, Secretary.
332.4973
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