The Credit System

The fact is, the mercantile system, introduced by England, or the credit system, that is, the system of making debt pass for capital, is itself failing, in consequence of its own expansion. The principle of the system, as we understand it, is to do business on credit and to rely on the profits of the business done to pay the interest on the borrowed capital and to discharge in time the loan itself. This would, perhaps, be well enough if the capital borrowed were real capital, for the volume of business would then not exceed the ability of the country to sustain and no general depression of business could occur. But it is credit, not capital, that is borrowed. The banks do not lend money, they simply lend their credit, and consequently depend on their debtors for the means to sustain their own credit or to redeem their bills; and these depend on the amount and profits of the business they do on their borrowed credit. If they fail the bank fails, or suspends, as it is politely called. The greater the facility of borrowing credit, the greater the extension of business. The multiplication of banks of discount facilitates the borrowing of credit, tempts an undue proportion of the young men of the country into business, and those already engaged to extend their business operations, till business is expanded far beyond the wants of the community or the ability of the industry and productions of the soil to support; and a collapse and business depression, as well as widespread financial ruin, inevitably follow. No wisdom, foresight, or prudence, no business tact or capacity, can save a house that has borrowed or given credit from failing, for it will be carried down by the collapse of credit or the demand for payment of the debt hitherto used as capital; and the means to pay it will not be forthcoming when business has been overdone.

Business men feel the pressure and, with us, demand of the government more currency or more banks to facilitate credit. Fatal delusion! The difficulty is not the lack of currency nor of institutions of credit, but that people have nothing to part with to sustain credit. We presume the business of the country, trade, manufactures, and internal improvements, is even now in excess of its actual ability, and consequently things must be worse before they can be better. All nations that turn their energies in the various channels of business, or make business their leading interest and push it beyond the ability of labor and the soil to sustain, must be constantly experiencing what we have been experiencing since September, 1873. In reality, the depression complained of is only an effort of nature, so to speak, to expel a disease that, if not expelled, must prove fatal. It is the result of the operation of the vis medicatrix of nature, and however painful it may be, it will bring with it a cure unless we immediately rush, as we are not unlikely to do, on the first symptoms of returning health, into another business debauch.

What remedy the government can apply we are neither statesman nor financier enough to say, but we do not believe there is any effectual remedy possible short of breaking up entirely the system that treats debt as capital; for in the long run the interest that must be paid on the borrowed credit used as capital will more than absorb the average net profits of the business that can be done with it. Individuals may succeed and enormous estates be accumulated, but the business classes as a body will fail and end poorer than they began. The nation will be only impoverished and weakened. Government may aggravate the evil, but we see little it can do to mitigate it. Neither resumption of specie payments nor inflation of the currency will cure it or permanently lessen it. We are an old man, but we cannot remember a time when we did not hear a loud demand for more currency; and even when the banks professed to redeem their bills in coin, the same periodical panics occurred, or seasons of business depression and hard times that have occurred under our present irredeemable paper money, only more frequently. We remember 1819, 1829, 1836-7, 1849, 1857, which were as disastrous as 1873 or as is 1875. We know no way of preventing these periodical panics, if you choose to call them so, with a mixed currency of gold and paper, or with banks of discount authorized to pay out their own notes as money, that is, to lend their credit instead of their capital.

Our studies of finance and political economy were made many years ago, say from 1829 to 1843, and we are too old to revise the views we then formed. We then became a “hard-money” man and opposed to all banks except banks of exchange, deposit, and transfer of credit. Such a policy may be objected to as likely, if it is adopted, to diminish largely the volume of business and to keep idle the little savings of the people; but that is precisely the result we would bring about. We grant our views are old-fashioned and directly opposed to those of the modern business world, to the spirit of enterprise now so loudly boasted; but we are not so silly as to suppose that any community will adopt them, and so we forbear to urge them. Yet we would restrict the volume of business, the trade and enterprise of the community to its real capital, and instead of facilitating the entrance of young men without capital into business, we would send them to cultivate the soil, employ them in agriculture or the mechanic arts; and that not for purposes of exchange or the acquisition of wealth, but to gain an honest living by the sweat of their face. This is the normal condition of man on the earth, and every departure from it is attended with more or less evil to body or soul, or to both. Yet by our age of material progress and “advanced ideas” this can be regarded only as very absurd and as betraying complete ignorance of the world we live in.

Financial Remedies

The various remedies suggested, whether by the president or by prominent merchants, traders, and bankers, are puerile, and not even palliatives. There is no remedy for a gangrenous limb or safety for the patient but in amputation, and not always even in that. The essence of the present system is in using debt as capital. Under it no debts are ever really paid; there is only a transfer of the debt, and all debts are mortgages on the future. A debt discharged in bank-notes becomes a debt against the bank; in greenbacks, it becomes a debt against the government, but in neither case is there any liquidation of the indebtedness. If the government credit fail – and a revolution or gross mismanagement may cause it to fail – somebody must lose; if the bank fail – and fail it must if it overdoes its business, if its debtors fail, if it lock up its means in unavailable or worthless assets, if there is a considerable shrinkage in their market value, or it its officers are speculators, stock-gamblers, swindlers, or defaulters – its creditors necessarily lose. The bank depends on its debtors for its ability to pay its own debts, and the government would bankrupt the whole people were it to attempt to liquidate at once its entire indebtedness. It is more than it now is able to do to meet its ordinary expenses and pay the interest on the public debt. For remedy, say some, create more banks, repeal all restrictions on their circulation, and relieve them of obligations to keep a reserve on hand. Authorize free banking, or banking by anybody that pleases, say others. Let the government issue more greenbacks or treasury notes, say others still; that is, remedy the evil by increasing it, or inflating still more our over-inflated credit!

The fact is, we have been attempting to be a great business community as distinguished from an agricultural community, and have subjected agriculture itself to the laws of commerce and manufactures. We have attempted to do more business than the country required or its capital and labor could sustain. We have been in too great a hurry and wished to plant and reap the same day. We have been carrying out vast schemes of internal improvements which exceed our means, and we are crippled with debt. We have operated on borrowed capital, which we have received in the shape of perishable merchandise and which we have consumed, leaving the original loan uncancelled. These loans, being paid chiefly in goods imported, have greatly stimulated the extravagance of the people and introduced a love of show and the habit of living beyond their income, while they are left to pay for the internal improvements, as far as paid for at all, out of their own pockets, and still taxed in one form or another to pay the interest constantly accruing to the foreign creditor, or the domestic creditor to whom the claim has been transferred. This tax for interest on debt and to support the extravagance generated by our foreign loans received for the most part in the shape of perishable merchandise, is too heavy for our land and labor, productive as is the one and intense and long-continued as is the other, and the consequence is that the people are in debt, and, speaking generally, live on credit or draw on their capital, hitherto chiefly in land, the better portion of which has already been parted with, eaten up, or worn out.

The remedy is not easy, for the ruling classes have not either the wisdom or the virtue to apply any effectual remedy. The most that they will tolerate is such measures as will enable them to tide over the present crisis or palliate its severity, but leave in full force all the causes that have produced it. Many of these causes are moral and social and beyond the reach of legislative or governmental action. So far as the remedy depends on the government, it consists: 1, in the total repeal of the legal-tender act and making nothing a legal tender but gold and silver; and, 2, in the restriction of the banks in the issue of their notes or bills to their actual ability at any time to redeem them in the lawful money of the United States. The twenty-five percent reserve the banks are now required to keep in their vaults affords no adequate security either to bill-holders or to depositors, as the present crash proves. The banks must not be allowed to draw interest on their debts which exceed their means of redeeming them on demand, nor use deposits as capital. We do not disguise the fact that these two measures would cause a considerable shrinkage in values and greatly diminish the volume of the business of the country; but they would tend also to check wild and reckless speculation and to place the business of the country on a safe and wholesome basis. Matters must become worse before they can become better. The volume of business we are doing is too large for the capital of the country, and it cannot be lessened without more or less suffering for a time to the mass of individuals. We have nothing with which to extinguish our indebtedness, whether foreign or domestic, but the produce of land and labor, and till we are compelled to bring our expenses within the income from land and labor, and so far within as to leave a surplus for a sinking-fund, we shall be afflicted with periodical panics like the present. Trade and large manufacturing establishments, as distinguished from domestic industries, are ruining us, as they ruin, in the long run, every nation that depends on them. The political economists are the most consummate fools going, for they regard man only as a producing and consuming animal and are ignorant of the sources of real wealth.

We do not expect either of the two measures we recommend – measures designed to put a stop to the use of debt as capital or stock in trade – will be adopted, nor do we expect to see any efficient remedy applied to the evils of which everybody complains. The present crisis will, after ruining thousands, perhaps hundreds of thousands, who will be unheeded as the slain in battle, exhaust itself, and the survivors, unwarned by experience, will resume the old course and count the battle won; till a new crisis, a new crash, or prostration of credit comes, from which the widow and the orphan, people of moderate means, and the laboring classes, as usual, will be the principal sufferers. Men will not believe that the worship of Mammon is suicidal and that political economy, to be successful, must, like virtue, be based on the principle of self-denial. The modern system of business and finance, which is that of using debt for capital, has too strong a hold on most modern nations, especially Great Britain and the United States, for any power in them to cast it off. It is rapidly becoming universal; it has triumphed over statesmanship, morality, and religion, and we suppose it must run its course till the modern nations find their boasted civilization evaporating in smoke. “The wicked shall be turned into hell, and all the nations that forget God.”

The Essence of Political Economy

The political economists consider man only as a producing, distributing, and consuming machine, and seek only to get the greatest possible supply with the greatest possible demand. ... I look upon man as having a sentient, intellectual, and moral nature, and I seek for him the greatest possible sum of virtue and happiness. It is not likely, then, that the political economists and I should think alike. It adds not to the well-being of the poor that the aggregate wealth of a nation increases if they are all the time growing poorer and find it every day more difficult to supply their wants or to obtain by honest industry their bread. Under the new system it may be that wealth increases, but the tendency in the great industrial nations is to concentrate it in fewer hands or in huge overgrown corporations, which in your country are stronger than the government and control, not always the elections, but the legislative assemblies, both state and national. ...

To make a man happy we should study not to increase his stores, but to diminish his desires. The political economists study to increase a man's desires and to develop new wants in him in order to increase as much as possible consumption, which, in turn, will increase the demand, and the increased demand will stimulate increased production. The demand creates the supply and the supply stimulates consumption, which, in turn, creates an increased demand. This, if I understand it, is the essence of your modern science of political economy. But what is the gain to the laborer? ...

The more wants one has that one is unable to satisfy, the more one suffers. A man's happiness does not consist in the number of wants satisfied, but in having no wants unsatisfied. It may well be conceded that if the laboring classes were thrown back into the condition in which they were in the middle ages, or even in the sixteenth century, they would be far more wretched than they are now; but that is not the question. Were their means of satisfaction less in proportion to their actual wants then than they are now in proportion to their present actual wants? No doubt more wants may now be satisfied, but that is nothing if there is a proportionate increase of wants that are not and cannot be satisfied.

The Wealth of Great Britain

Nowhere did I find the extremes of wealth and poverty so striking as in Great Britain. The wealth of her nobility was often great, but that was in most cases due to the enhanced value of their landed estates and led to no painful reflections. But the huge wealth of her merchant princes, her cotton or industrial lords, her bankers and money-changers, contrasted sadly with the mighty mass of pauperism, every day increasing and supported by rates levied on householders, themselves often but a shade above the pauper.

I could not but think by what a terrible tax on the laboring classes their enormous wealth must have been accumulated. Their wealth has been gained at the expense not only of the laboring class of their own country, but at the expense of the laboring classes of British India and of all nations against which Great Britain holds the balance of trade. It has been gained by coining the toil, the sweat, the tears, and the blood of millions; and what can I say in defense of the system that permits, encourages, nay, demands for its success, such gross outrages upon our fellow-men?

Trade Does Not Enrich A People

But there are things of greater value to a nation than trade. No nation is really enriched by trade. Trade accumulates luxuries, but luxuries impoverish, not enrich a people. All real wealth is in land and labor, and that nation is richest in which labor can the easiest obtain from the land the means of subsistence and comfort. The land is with us vastly more burdened than it was fifty years ago, and hence it is far harder for the laborer to maintain his independence. Land and labor have to sustain with us a lavish expenditure, a luxury and extravagance that tax their energies far beyond their present capacity, since our indebtedness, our drafts on the future, must be counted by hundreds, if not by thousands of millions. All credit is a draft on the future, and the amount of a nation's indebtedness is the excess of its expenditures over its income. The actual addition to our productive capital in any one year does not equal the indebtedness we contract during that year, and hence with all our trade and industry we rather grow poorer than richer, and the difficulty of living becomes greater. The fact of this difficulty every poor man feels, and feels notwithstanding the new lands opened to cultivation and the immense additions made every year to our wealth by the immigration of hardy, healthy, able-bodied adult laborers, men and women. The reason of this is the fact that by the modern system of trade and commerce we increase the burdens of land and labor. Let China engage in trade with the energy and enterprise displayed by Great Britain, and she would soon find herself unable to support her four hundred millions of inhabitants, and the want and wretchedness of her population would be increased a hundred-fold; for the additional burden it would impose on land and labor would be expended in luxuries, and worse than a dead loss to the nation. ... The evil that weighs us down is in the immense numbers of non-producers land and labor have to support, and to a great extent in luxury and extravagance.

We Cannot Go Back

I propose no going back to former industrial arrangements. True, I do not believe all is gold that glistens, nor that the people are really any better off under the new system than they were before it was adopted; but since it is adopted and habits and modes of action are conformed and adjusted to it, we could not dispense with it without causing a far greater evil than was caused by its introduction and adoption. The church can use your railroads and steamboats for her missionaries, and your lightning telegraphs for rapid communications between her head and members. If it was no advantage to make the change, it still would be a great disadvantage to be forced to return to the past.

The world, with its present passions and interests, knows not how to dispense with the modern industrial and mercantile system, ruinous to the real virtue and happiness of the people as it may be. It is the reigning order, and even they who dislike it cannot live without it and are obliged to conform to it. The world, which does not and cannot appreciate the superiority of the spiritual to the temporal, nor take any very broad and comprehensive views even of the temporal, cannot spare Great Britain or suffer her to be eclipsed. Her downfall would carry with it the downfall of the whole credit and funding system, that ingenious device for taxing posterity for the benefit of the present generation. Stock-gambling would fall, the whole system of fictitious wealth would disappear, and the greater part of modern shams and illusions. The downfall of Great Britain would produce a universal convulsion and produce effects of hardly less magnitude than the downfall of ancient Rome. The emancipated nations would not know how to use their newly-recovered liberties. The keystone would be struck from the arch of the modern world. The crash some day must come, but no nation is ready for it, and the nations most hostile to Great Britain will rather labor to sustain her in order to prevent the catastrophe than to hasten her downfall.

Political Economists take too Narrow a View

We know that we do not follow Adam Smith or any of the political economists, though it is possible that we have studied him and them as much as most men have. They are right enough from their point of view and in their narrow sphere, but the system they defend, when carried into practice and made the rule of national policy, is about as absurd and mischievous a system as the devil ever assisted the human mind to invent. ...

We are far from believing that the modern industrial and commercial system inaugurated by the treaty of Utrecht, 1713, and at the head of which is Great Britain, is a system really advantageous to the world or destined, in fact, to be a permanent system. We believe it impoverishes more than it enriches nations, while it favors their moral degradation. It multiplies luxuries to an enormous extent, as we can see by simply looking about us in our own city, but it does not render a people really wealthier or render it more easy for them to obtain a living. Expenses are increased at a greater ratio than gains. The general style of living requires an income larger than can possibly be obtained in the slow and regular way of business or industry. Hence the rage for speculation, the reliance on a lucky hit, in which few can be successful, to make a fortune. Hence the innumerable failures, bankruptcies, insolvencies, frauds, dishonest contrivances which are the disgrace of modern states and are fast destroying all confidence of man in man. We sometimes think that Great Britain, by carrying with her everywhere this demoralizing system, more than overbalances the good she does by her advocacy of the great principles of civil freedom and constitutional government. A war with her that should break up this system and force us to become less a commercial and more an agricultural people would, we have no doubt, in the long run, prove an advantage to us, both under an economical and a moral point of view. But as long as the system remains each nation must in self-defense adopt it, defend it, and draw from it all the advantage it can. Therefore, though disliking the system, we still urge our government to guard it with vigilance.

Results of the Modern System

We might go further in proof of the sad state to which we are coming or have already come. We are told, on tolerable authority, that in this city of Boston, which we take it is the model city of this country, there are some four thousand wretched prostitutes out of a population of about one hundred thousand. This fact is not only a lucid commentary on our morals, but also on the difficulty there is in getting a living by honest industry; since prostitution is resorted to in this and all other countries rarely through licentiousness, but chiefly, almost wholly, through poverty. We are also told by the agents of the police, who have the best means of knowing, that the principal supply of these victims to poverty and men's infamy comes from the factories in the neighboring towns – no uninteresting comment on the workings of the factory system built up by our banks and high tariffs, and which the chiefs of our industry have taken and are taking so much pains to fasten on the country! ...

There can be no question that within the last three hundred years there has been a most wonderful increase of industrial activity, of man's productive power, and of the aggregate wealth of the world. Great industries, so to speak, have within these three hundred years sprung up, never before conceived of; man has literally made the winds his messengers and flames of fire his ministers; all nature works for him; the mountains sink and the valleys rise before him; the land and the ocean fling out their treasures to him; and time and space are annihilated by his science and skill. All this is unquestionable. On the other hand, equally unquestionable is it to him who has looked on the matter with clear vision that in no three hundred years known to us since men began to be born and to die on this planet, upon the whole, it has fared worse, for soul or for body, with the great mass of the laboring population. Our advance, it would seem, has been that ordered by the militia captain, an “advance backwards!” This statement may or may not make sad work with our theories of progress of the race, progress of light, of political and social well-being, and all that; but it is a fact, an undeniable, a most mournful fact, which get over we cannot, try we never so hard.

For these last three hundred years we have lost or been losing our faith in God, in heaven, in love, in justice, in eternity, and been acquiring faith only in human philosophies, in mere theories concerning supply and demand, wealth of nations, self-supporting, labor-saving governments; needing no virtue, wisdom, love, sacrifice, or heroism on the part of their managers; working out for us a new Eden, converting all the earth into an Eldorado land, and enabling us all to live in Eden Regained. We have left behind us the living faith of the earlier ages; we have abandoned our old notions of heaven and hell, and have come, as Carlyle well has it, to place our heaven in success in money matters, and to find the infinite terror which men call hell only in not succeeding in making money. We have thus come – where we are. Here is a fact worth meditating.

Even your modern slaveholder is obliged to recognize a relation between him and his slave of a more generous and touching nature than any recognized by the master-worker between himself and his workman. The slave when old or sick must be protected, provided for, whether the owner receives any profit from him or not; the master-worker has discharged all the obligation to his operative he acknowledges when he has paid him the stipulated wages. These wages may be insufficient for mere human subsistence, and the poor worker must die; but what is that to the master-worker? Has he not paid all he agreed to pay, even to the last farthing, promptly? We have not heard on our southern plantations of Stockport cellars, of bread-and-soup societies by the charitable, and men stealing in order to be sent to the House of Correction so as not to starve. This much we can say of the slave, that if he will tend pigs in the wood he shall have some parings of the pork, and so long as his master has full barns he is not likely to starve. Would we could say as much of the hired laborer always!

What is the Remedy?

But, after all, what is the remedy? Let us not deceive ourselves. The whole head is sick, the whole heart is faint. Our industrial arrangements, the relations of master-workers and workers, of capital and labor, which have grown up during these last three hundred years are essentially vicious, and, as we have seen, are beginning throughout Christendom to prove themselves so. The great evil is not now in the tyranny or oppressions of governments as such; it is not in the arbitrary power of monarchies, aristocracies, or democracies; but it is in the heart of the people and the industrial order. It is simply, under the industrial head, so far as concerns our material well-being, in this fact, this mournful fact, that there is no longer any certainty of the born worker obtaining always work whereby he can provide for the ordinary wants of a human being. Nor is this altogether the fault of the master-workers. To a very great extent the immediate employer is himself in turn employed; and as all who produce produce to sell, their means of employing constantly and at reasonable wages evidently depend on the state of the market; workmen must, therefore, with every depression of trade, be thrown out of employment, whatever the benevolence of the master-workers.

Nor is it possible, with the present organization, or rather disorganization of industry, to prevent these ruinous fluctuations of trade. They may undoubtedly be exaggerated by bad legislation, as they may be mitigated by wise and just administration of government, but prevented altogether they cannot be. For this plain reason, that more can be produced in any given year with the present productive power than can be sold in any given five years – we mean sold to the actual consumer. In other words, by our vicious method of distributing the products of labor we destroy the possibility of keeping up an equilibrium between production and consumption. We create a surplus – that is, a surplus, not when we consider the wants of the people, but when we consider the state of the markets – and then must slacken our hands till the surplus is worked off. During this time, while we are working off the surplus, while the mills run short time or stop altogether, the workmen must want employment. The evil is inherent in the system. We say it is inherent in the system of wages, of cash payments, which, as at present understood, the world has for the first time made any general experiment of only now, since the Protestant reformation.

Let us not be misinterpreted. We repeat not here the folly of some men about equality and every man being in all things his own guide and master. This world is not so made. There must be in all branches of human activity, mental, social, industrial, chiefs and leaders. Rarely, if ever, does a man remain a workman at wages who could succeed in managing an industrial establishment for himself. Here is our friend Mr. Smith, an excellent hatter, kind-hearted, charitable, and succeeds well; but of the fifty hands he employs not one could take his place. Many of these journeymen of his have been in business for themselves, but failed. They are admirable workmen, but have not the capacity to direct, to manage, to carry on business. It is so the world over. There must be chiefs in religion, in politics, in industry; the few must lead, the many must follow. This is the order of nature; it is the ordinance of God; and it is worse than idle to contend against it. The great question concerns the mode of designating these chiefs and the form of the relation which shall subsist between them and the rest of the community. Our present mode of designating them in the industrial world – in the political we manage it in this country somewhat better – is obviously defective, and the relation expressed by wages in our modern sense of the term is an undeniable failure. Under it there is no security, no permanency, no true prosperity, for either worker or master-worker; both hurry on to one common ruin.

This, we are well aware, will not be believed. We do not believe ourselves ill. We mistake the hectic flush on the cheek for the hue of health. “We have heard,” say our readers, “this cry of ruin ever since we could remember, and yet we have gone on prospering, increasing in wealth, refinement, art, literature, science, and doubling our population every thirty years.” Yes, and we shall continue to prosper in the same way. The present stagnation of trade will last not much longer; business will soon revive, nay, is reviving; and we shall feel that the evil day is too far off to be guarded against. We shall grow richer; we shall build up yet larger industries; the hammer will ring from morning till night – till far into the night; the clack of the cotton-mill will accompany the music of every waterfall; the whole land be covered by a vast network of railroads and canals; our ships will display their canvas upon every sea and fill every port; our empire shall extend from the Atlantic to the Pacific and from the Northern Ocean to the Isthmus of Darien; we shall surpass England as much as ancient Carthage surpassed the mother Phoenicia; be the richest, the most renowned nation the world ever saw. All this it needs no prophetic eye to foresee; prosperity of this sort we may have, shall have. It is not of outward, material ruin we speak. But what will avail all this outward prosperity – our industries, our wealth, our arts, our luxuries, our boundless empire, our millions of people – if we contain in our midst a greater mass of corruption, of selfishness, of vice, of crime, of abject misery and wretchedness than the world ever saw before? And yet such will be our fate if we continue on in the path, nay, the broad road, in which we are now traveling.

But once more, we are asked, what is the remedy? Shall we go back to the middle ages? ... No, dear countrymen, no. This is no longer possible even if it were desirable. ...

We would have men governed, and well governed, let who will be the governors or what form adopted there may be for selecting them. God's curse and humanity's curse also do and will rest on the no-government schemers. Satan himself was chief anarch, and all anarchs are his children. Men need government, nay, have a right to demand government, without which there is no life for them. We would also see revived in all its medieval force and activity the Christian faith, and as the interpreter of that faith the Christian church, one and indivisible; the ground and pillar of the truth; clothed with the authority which of right belongs to it; and enjoining and exercising a discipline on high and low, rich and poor, as effective as that of the middle ages, but modified to meet the new wants and relations of Christendom. There is no true living on this God's earth for men who do not believe in God, in Christ, in the ever-present spirit of truth, justice, love; in the reality of the spiritual world; nor without the church of Christ, active and efficient, authoritative over faith and conscience, competent to instruct us in the mysteries of our destiny, to direct us wisely and surely through the creation of a heaven here on earth, to a holier and higher heaven hereafter. We must revoke the divorce unwisely and wickedly decreed between politics and religion and morality. It must not be accounted a superfluity in the politician to have a conscience; nor an impertinence to speak and act as if he believed in the eternal God and feared the retributions of the unseen world; nor inconsistent with the acknowledged duties of the minister of religion to withhold absolution from the base politician, the foul wretch, whatever his private morals, who will in public life betray his country or support an unjust policy through plea of utility or mere expediency. It must not always be in vain that a public measure is shown to be unjust in order to secure its defeat or just in order to secure its adoption. Nations must be made to feel that there is a Higher than they, and that they may lawfully do only what the Sovereign of sovereigns commands. Right must be carried into the cabinet councils of ministers, into legislative halls, into the bureaus of businesses, and preside at the tribunals of justice; men must be made to feel deep in their inmost being, whether in public life or in private life, that they are watched by the all-seeing Eye, and that it is better to be poor, better to beg, better to starve, than to depart in the least iota from the law of rigid justice and thrice-blessed charity. This is what we need; what we demand for our country, for all countries; and demand too in the reverend name of Him who was, and is, and is to be, and in the sacred name of humanity, whose maternal heart is wounded by the least wound received by the least significant of her children.

Duty of Capitalists

Of industrial reforms properly so called we speak not. Owenisms, Saint-Simonisms, Fourierisms, Communisms, and isms enough in all conscience are rife, indicating at least that men are beginning to feel that the present industrial relations are becoming quite unbearable. Three years ago we brought forward our “Morrison Pill,” but the public made up wry faces and absolutely refused to take it; so much the worse for them. We cannot afford to throw away our medicines, even if they are quack medicines. We cease attempting to prescribe. We leave this matter to the natural chiefs of industry, that is, to bank presidents, cashiers, and directors; to the presidents and directors of insurance offices, of railroads and other corporations; heavy manufacturers and leading merchants; the master-workers, in Carlyle's terminology, the Plugsons of Undershot. Messrs. Plugsons of Undershot, you are a numerous and a powerful body. You are the chiefs of industry, and in some sort hold our lives in your pockets. You are a respectable body. We see you occupying the chief seats in the synagogues, consulted by secretaries of the treasury, constituting boards of trade, conventions of manufacturers, forming home leagues, presiding over lyceums, making speeches at meetings for the relief of the poor and other charitable purposes. You are great; you are respectable; and you have a benevolent regard for all poor laborers. Suffer us, alas! a poor laborer enough, to do you homage and render you the tribute of our gratitude. Think not that we mean to reproach you with the present state of industry and the workingmen. We have no reproaches to bring. But ye are able to place our industry on its right basis, and we call upon you to do it; nay, we tell you that not we only, but a Higher than any of us, will hold you responsible for the future condition of the industrial classes. If you govern industry only with a view to your own profit, to the profit of master-workers, we tell you that the little you contribute to build workhouses and to furnish bread and soup will not be held as a final discharge.

If God has given you capacities to lead, it has been that you might be a blessing to those who want that capacity. As he will hold the clergy responsible for the religious faith of the people, as he will hold the political chiefs responsible for the wise ordinance and administration of the government, so, respected Masters, will he hold you responsible for the wise organization of industry and the just distribution of its fruits. Here we dare speak, for here we are the interpreter of the law of God. Every pang the poor mother feels over her starving boy is recorded in heaven against you and goes to swell the account you are running up there, and which you, with all your financiering, may be unable to discharge. Do not believe that no books are kept but your own, nor that your method of book-keeping by double entry is the highest method, the most perfect. Look to it, then. What does it profit, though a man gain the whole world and lose his own soul? Ay, respected Masters, as little as ye think of the matter, ye have souls, and souls that can be lost, too, if not lost already. In God's name, in humanity's name, nay, in the name of your own souls, which will not relish the fire that is never quenched nor feel at ease under the gnawings of the worm that never dies, let us entreat you to lose no time in rearranging industry and preventing the recurrence of these evils, which with no malice we have roughly sketched for you to look upon. The matter, friends, is pressing, and delay may prove fatal. Remember, there is a God in heaven who may say to you, “Go to now, ye rich men, weep and howl for your miseries that shall come upon you; your riches are corrupted, and your garments are moth-eaten, your gold and silver is cankered; and the rust of them shall be a witness against you, and shall eat your flesh as it were fire. You have stored up to yourselves wrath against the last days. Behold the hire of the laborers who have reaped your fields of which you have defrauded them, crieth out; and the cry of them hath entered into the ears of the Lord of Sabaoth.” This is not our denunciation; it is not the declamation of the agrarian seeking to arm the poor against the rich; but it is God himself speaking to you now in warning, what he will hereafter, unless you are wise, speak to you in retribution.





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