A Letter to Grover Cleveland Part 5

The laws arbitrarily prohibiting, or arbitrarily qualifying, certain contracts, that are naturally and intrinsically just and lawful, are so numerous, and so well known, that they need not all be enumerated here.

But any and all such prohibitions, or qualifications, are a denial of men's _natural_ right to make their own contracts. They are a denial of men's right to make any contracts whatever, except such as the governments shall see fit to permit them to make.

It is the _natural_ right of any and all human beings, who are mentally competent to make reasonable contracts, to make any and every possible contract, that is naturally and intrinsically just and honest, for buying and selling, borrowing and lending, giving and receiving, any and all possible commodities, that are naturally vendible, loanable, and transferable, and that any two or more individuals may, at any time, without force or fraud, choose to buy and sell, borrow and lend, give and receive, of and to each other.

And it is plainly only by the untrammelled exercise of this _natural_ right, that all the loanable capital, that is required by men's industries, can be lent and borrowed, or that all the money can be supplied for the purchase and sale of that almost infinite diversity and amount of commodities, that men are capable of producing, and that are to be transferred from the hands of the producers to those of the consumers.

But the government of the United States--and also the governments of the States--utterly deny the _natural_ right of any individuals whatever to make any contracts whatever, for buying and selling, borrowing and lending, giving and receiving, any and all such commodities, as are naturally vendible, loanable, and transferable, and as the producers and consumers of such commodities may wish to buy and sell, borrow and lend, give and receive, of and to each other.

These governments (State and national) deny this _natural_ right of buying and selling, etc., by arbitrarily prohibiting, or qualifying, all such, and so many, of these contracts, as they choose to prohibit, or qualify.

The prohibition, or qualification, of _any one_ of these contracts--that are intrinsically just and lawful--is a denial of all individual _natural_ right to make any of them. For the right to make any and all of them stands on the same grounds of _natural_ law, natural justice, and men's natural rights. If a government has the right to prohibit, or qualify, any one of these contracts, it has the same right to prohibit, or qualify, all of them. Therefore the a.s.sertion, by the government, of a right to prohibit, or qualify, any one of them, is equivalent to a denial of all _natural_ right, on the part of individuals, to make any of them.

The power that has been thus usurped by governments, to arbitrarily prohibit or qualify all contracts that are naturally and intrinsically just and lawful, has been the great, perhaps the greatest, of all the instrumentalities, by which, in this, as in other countries, nearly all the wealth, acc.u.mulated by the labor of the many, has been, and is now, transferred into the pockets of the few.

_It is by this arbitrary power over contracts, that the monopoly of money is sustained._ Few people have any real perception of the power, which this monopoly gives to the holders of it, over the industry and traffic of all other persons. And the one only purpose of the monopoly is to enable the holders of it to rob everybody else in the prices of their labor, and the products of their labor.

The theory, on which the advocates of this monopoly attempt to justify it, is simply this: _That it is not at all necessary that money should be a bona fide equivalent of the labor or property that is to be bought with it;_ that if the government will but specially license a small amount of money, and prohibit all other money, the holders of the licensed money will then be able to buy with it the labor and property of all other persons for a half, a tenth, a hundredth, a thousandth, or a millionth, of what such labor and property are really and truly worth.

David A. Wells, one of the most prominent--perhaps at this time, the most prominent--advocate of the monopoly, in this country, states the theory thus:

A three-cent piece, if it could be divided into a sufficient number of pieces, with each piece capable of being handled, would undoubtedly suffice for doing all the business of the country in the way of facilitating exchanges, if no other better instrumentality was available.--_New York Herald, February 13, 1875._

He means here to say, that "a three-cent piece" contains _as much real, true, and natural market value_, as it would be necessary that all the money of the country should have, _if the government would but prohibit all other money_; that is, if the government, by its arbitrary legislative power, would but make all other and better money unavailable.

And this is the theory, on which John Locke, David Hume, Adam Smith, David Ricardo, J. R. McCulloch, and John Stuart Mill, in England, and Amasa Walker, Charles H. Carroll, Hugh McCulloch, in this country, and all the other conspicuous advocates of the monopoly, both in this country and in England, have attempted to justify it. They have all held that it was not necessary that money should be a _bona fide_ equivalent of the labor or property to be bought with it; but that, by the prohibition of all other money, the holders of a comparatively worthless amount of licensed money would be enabled to buy, at their own prices, the labor and property of all other men.

And this is the theory on which the governments of England and the United States have always, with immaterial exceptions, acted, in prohibiting all but such small amounts of money as they (the governments) should specially license. _And it is the theory upon which they act now._ And it is so manifestly a theory of pure robbery, that scarce a word can be necessary to make it more evidently so than it now is.

But inasmuch as your mind seems to be filled with the wildest visions of the excellency of this government, and to be strangely ignorant of its wrongs; and inasmuch as this monopoly of money is, in its practical operation, one of the greatest--possibly the greatest--of all these wrongs, and the one that is most relied upon for robbing the great body of the people, and keeping them in poverty and servitude, it is plainly important that you should have your eyes opened on the subject. I therefore submit, for your consideration, the following self-evident propositions:

1. That to make all traffic just and equal, it is indispensable that, in each separate purchase and sale, the money paid should be a _bona fide_ equivalent of the labor or property bought with it.

Dare you, or any other man, of common sense and common honesty, dispute the truth of that proposition? If not, let us consider that principle established. It will then serve as one of the necessary and infallible guides to the true settlement of all the other questions that remain to be settled.

2. That so long as no force or fraud is practised by either party, the parties themselves, to each separate contract, have the sole, absolute, and unqualified right to decide for themselves, _what money, and how much of it_, shall be considered a _bona fide_ equivalent of the labor or property that is to be exchanged for it. All this is necessarily implied in the _natural_ right of men to make their own contracts, for buying and selling their respective commodities.

Will you dispute the truth of that proposition?

3. That any one man, who has an honest dollar, of any kind whatsoever, has as perfect a right, as any other man can have, to offer it in the market, in compet.i.tion with any and all other dollars, in exchange for such labor or property as may be in the market for sale.

Will you dispute the truth of that proposition?

4. That where no fraud is practised, every person, who is mentally competent to make reasonable contracts, must be presumed to be as competent to judge of the value of the money that is offered in the market, as he is to judge of the value of all the other commodities that are bought and sold for money.

Will you dispute the truth of that proposition?

5. That the free and open market, in which all honest money and all honest commodities are free to be given and received in exchange for each other, is the true, final, absolute, and only test of the true and natural market value of all money, as of all the other commodities that are bought and sold for money.

Will you dispute the truth of that proposition?

6. That any prohibition, by a government, of any such kind or amount of money--provided it be honest in itself--as the parties to contracts may voluntarily agree to give and receive in exchange for labor or property, is a palpable violation of their natural right to make their own contracts, and to buy and sell their labor and property on such terms as they may find to be necessary for the supply of their wants, or may think most beneficial to their interests.

Will you dispute the truth of that proposition?

7. That any government, that licenses a small amount of an article of such universal necessity as money, and that gives the control of it into a few hands, selected by itself, and then prohibits any and all other money--that is intrinsically honest and valuable--palpably violates all other men's natural right to make their own contracts, and infallibly proves its purpose to be to enable the few holders of the licensed money to rob all other persons in the prices of their labor and property.

Will you dispute the truth of that proposition?

Are not all these propositions so self-evident, or so easily demonstrated, that they cannot, with any reason, be disputed?

If you feel competent to show the falsehood of any one of them, I hope you will attempt the task.

SECTION XIV.

If, now, you wish to form some rational opinion of the extent of the robbery practised in this country, by the holders of this monopoly of money, you have only to look at the following facts.

There are, in this country, I think, at least twenty-five millions of persons, male and female, sixteen years old, and upwards, mentally and physically capable of running machinery, producing wealth, and supplying their own needs for an independent and comfortable subsistence.

To make their industry most effective, and to enable them, _individually_, to put into their own pockets as large a portion as possible of their own earnings, they need, _on an average_, one thousand dollars each of _money capital_. Some need one, two, three, or five hundred dollars, others one, two, three, or five thousand. These persons, then, need, _in the aggregate_, twenty-five thousand millions of dollars ($25,000,000,000), of money capital.

They need all this _money capital_ to enable them to buy the raw materials upon which to bestow their labor, the implements and machinery with which to labor, and their means of subsistence while producing their goods for the market.

Unless they can get this capital, they must all either work at a disadvantage, or not work at all. A very large portion of them, to save themselves from starvation, have no alternative but to sell their labor to others, at just such prices these others choose to pay. And these others choose to pay only such prices as are far below what the laborers could produce, if they themselves had the necessary capital to work with.

But this needed capital your lawmakers arbitrarily forbid them to have; and for no other reason than to reduce them to the condition of servants; and subject them to all such extortions as their employers--the holders of the privileged money--may choose to practise upon them.

If, now, you ask me where these twenty-five thousand millions of dollars of money capital, which these laborers need, are to come from, I answer:

_Theoretically_, there are, in this country, fifty thousand millions of dollars of money capital ($50,000,000,000)--or twice as much as I have supposed these laborers to need--NOW LYING IDLE! _And it is lying idle, solely because the circulation of it, as money, is prohibited by the lawmakers._

If you ask how this can be, I will tell you.

_Theoretically,_ every dollar's worth of material property, that is capable of being taken by law, and applied to the payment of the owner's debts, is capable of being represented by a promissory note, that shall circulate as money.

But taking all this material property at _only half_ its actual value, it is still capable of supplying the twenty-five thousand millions of dollars--or one thousand dollars each--which these laborers need.

Now, we know--because experience has taught us--that _solvent_ promissory notes, made payable in coin on demand, are the best money that mankind have ever had; (although probably not the best they ever will have).

To make a note solvent, and suitable for circulation as money, it is only necessary that it should be made payable in coin on demand, and be issued by a person, or persons, who are known to have in their hands abundant material property, that can be taken by law, and applied to the payment of the note, with all costs and damages for non-payment on demand.

_Theoretically,_ I repeat, all the material property in the country, that can be taken by law, and applied to the payment of debt can be used as banking capital; and be represented by promissory notes, made payable in coin on demand. And, _practically_, so much of it can be used as banking capital as may be required for supplying all the notes that can be kept in circulation as money.

Although these notes are made legally payable in coin on demand, it is seldom that such payment is demanded, _if only it be publicly known that the notes are solvent_: that is, if it be publicly known that they are issued by persons who have so much material property, that can be taken by law, and sold, as may be necessary to bring the coin that is needed to pay the notes. In such cases, the notes are preferred to the coin, because they are so much more safe and convenient for handling, counting, and transportation, than is the coin; and also because we can have so many times more of them.

These notes are also a legal tender, to the banks that issue them, in payment of the notes discounted; that is, in payment of the notes given by the borrowers to the banks. And, in the ordinary course of things, _all_ the notes, issued by the banks for circulation, are wanted, and come back to the banks, in payment of the notes discounted; thus saving all necessity for redeeming them with coin, except in rare cases. For meeting these rare cases, the banks find it necessary to keep on hand small amounts of coin; probably not more than one per cent. of the amount of notes in circulation.

As the notes discounted have usually but a short time to run,--say three months on an average,--the bank notes issued for circulation will _all_ come back, _on an average_, once in three months, and be redeemed by the bankers, by being accepted in payment of the notes discounted.