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B1NXING-A 8CIIEME OF CBEDIT IN
FLATION. Money and banking aro the chief factors in the mechanism of exchange, and this is the most important ques tion which confronts the people of this country to-day, Every producer of wealth labors to create something that can be exchanged for the pro ducts created by the labor of others. The transfer of these products from the producer to the consumer consti tutes the commerce of the world and affects every vein, artery and fiber of our civilization. Every expense of every name and character connected with the exchange must be paid by the consumers, the great mass of whom are laborers m the varied fields of industry. Hence labor is not only the sole producer of wealth but is also the principal consumer, and is therefore pre-eminently inter ested in the machinery by which wealth is exchanged. According to Adam Smith, the product of labor is its natural re ward, and as labor is both the pro ducer and the consumer, it follows as a logical sequence that absolute jus tice would secure to labor as a pro ducer all that labor was required to pay as a consumer, less an equitable compensation for transportation, su perintendence, etc., connected with the distribution. This would secure an abundance to every useful worker just as long as an abundance was produced. But under our existing system of exchange the producers of wealth find themselves growing poor. The farmers of this county, once the owners of the great bulk of the , wealth of the nation, now possess less than 22 per cent, of that wealth, and yet they have been engaged in the work of furnishing the food for the world. They have been engaged in a losing business as demonstrated by statistics. They have lost in the exchange the wealth created by their labor, and what they have lost consti tutes the major part of the vast ac cumulations of wealth now in the possession of our American plutoc racy. It therefore becomes a matter of the first importance that the average citizen and voter should understand the system by which the products of his labor are exchanged. Money is a legal tender for debt in which all bal ances must be p-id on the demand of the creditor, but it is only a compari tively small per cent, of our circulat ing medium. Ninety-five per cent, of the business exchanges of the country are effected by means of credit bearing interest Money is deposited in .the banks by persons having funds which they do no ned ' for immediate use. These deposits are loaned by the banks to borrowers, secured by mortgages on property. When the borrowers expend the money it is returned by others to the bank in the form of deposits, and again loaned to other borrowers. By this process the same dollars are 'continually being loaned and re loaned for interest Thus by con tinually creating interest bearing debt, money is kept in circulation and the wheels of commerce moving. Under this system cnly the small cash reserves required by law are kept in the banks. According to the latest figures that we have at hand the banks of the country had in their vaults in October, 1890, a cash re serve of 475,754,000, while they owed their depositors the snm of $4,194, 000,000. We thus learn that the banks at that time had on hand a lit tle more than enough to pay 81 in $8 of the sum which they owed their de positors. The difference between the cash reserve and the amount due de positors, the enormous sum of $3,758, 246,000 is a purely credit currency, with no foundation in money whatever. And yet this bank credit that has been loaned to the people constitutes the basis of the interest bearing debt that burdens the industries of the country, every dollar of which the money power claims must be paid in gold. At an average rate of only 6 per cent, interest, this bank credid, or confidence money, costs the people $225,421,760 per annum, a sum equivalent to the earnings of 626,374 laborers, at $1 per day. Such is the system of bank credit which under our monetary system takes the place that should be filled by full legal ten der money. As the basis of this credit currency is only about one eighth of its volume, the withdrawal of a email portion of the bank re sources must be followed by a con traction of the circulating medium equal to eight times the amount of the money withdrawn. Thus $100, 000,000 withdrawn from the bank re serves would be equivalent to with drawal of $800,000,000 from the circu lating medium. Under such a system of credit in flation the people are kept in contin ual danger of financial reverses. De pression to agriculture, poverty and suffering to wage workers and bankruptcy and ruin to legitimate business are its legitimate fruits. Fif teen thousnd business failures dur ing 1890 emphasises the demand for its removal and the establishment in its place of a debt paying system of finance. Productive labor creates the wealth that is exchanged by the legitimate business classes. Both labor and business suffer from the exactions of monopoly. If they were to form a co-partnership on the basis of ex changing service for service, no pow er of agregated capital could compell either, to pay tribute. These class es ought to become better acquainted. The wealth producer ought to know more of business methods while the business man should study labor ethics. When farmer competes with farmer for a chance to sell bis products, and when wage-worker competes with wage-worker for an opportunity to sell his labor, capital is king. But when capital competes with capital to secure the products of the soil or the services of the wage-worker, labor will be king. Labor will never be freed from the tribute it now pays to monopoly until it learns to co-operate. Usury may bo described as the worm that dieth not Day and night Sundays end hollidays included, it is gnawing at the vitals of industry. Were it not for Senator Peffer's beard, Jerry Simpson's feet and Mrs. Lease's mouth the old party press wouldrun out of subjects for brainy editorials. IT IS PAID FOR. Parties who receive The Advocate and who have not subscribed for it, need hava no fears about taking it from the office. The Advocate is never sent to anybody with a view of asking pay for it afterwards. It is paid for if you receive it. All the powers exercised by cor porations are taken from the powers which were delegated by the people to the government. These powers should be returned to the govern ment and exercised for the benefit of the people, and not for the enrich ment of a corporate plutocracy. "Tbe farmer who hangs on to his old party affiliations is to a very great ex tent responsible for all the poverty that exists among the tillers of the soil. The producers of the food pro ducts of the world ought to be the most independent class of people in the world. Yet the banker, the spec ulator in farm products, the railroad operator and protected manufacturers amass millions, while the farm er comes out indebt to non-producers at the end of the year. Ex-Congressman Hanback is re ported as saying in a recent speech, that, had he the power, he would stop the pension of every soldier who has formerly been a Republican and recently voted the People's party ticket. If this is true it would seem Chat pensions are regarded as rewards for service to the Republican party, and not as obligations of the govern ment for services, rendered in the army and navy of the United States. Will Mr. Hanback rise and explain? Banking is the chief factor in the mechanism of exchange. When the producers of wealth, have sufficient intelligence, to provide themselves currency at cost, by which to effect exchanges, pay debts and employ themselves in producing what they consume, they will then be masters of the situation. And until they do this, they will be compelled to pay tribute to banks and monied syndicates in the shape of usury, for the privilege of exercising their natural right to exchange the wealth created by their labor. Politicians seek to keep the city workmen out of the People's party by telling them that farmers' as a class favor low wages and long hours. This is certainly not true bo far as Kansas farmers are concerned. In 1888 they gave a majority of 82,000 for Harrison and protection, for the avowed purpose of securing better wages for the American workman. Of course the scheme failed, as it always will fail to secure this result, but that was not the fault of the farmers. Capitalistic employers, always found in the old parties, are the real enemies of high wages and short hours. . See our new clubbing offer on page eleven. If you wish to keep posted you can not afford to miss our Wash ington articles during the coming session of Congress. Labor is the creator of capital and yet capital assumes to dictate laws that labor must obey. The thing created thus assumes to be greater than its creator. "Shall the clay say unto the potter, 'What makest thou!' " The esteemed Atchison Champion of the 8th inst. presents its reasons with a long editorial article on the subject of "Socialism Illustrated" and uses country roads as the illustration. Did it ever occur to the Champion that if the people who have in charge the care of the country roads were paid a fair salary for their time and labor as is done with the managers of railroads, etc., the county roads would probably be kept in as good condition as the railroads! There is no work or business so well paid for as that of the government service. Even monopolists concede that man has a right to life and law punishes the murderer. But no man can live if he is deprived of a place to live. His right to a home on the soil is just as sacred and just as well founded in absolute justice as his right to life, and yet under a govern ment which is supposed to derive its powers from the consent of the governed, we permit millions to be disinherited. We inherited a conti nent and to day the fairest portion of it has passed in to the hands of land monopolists. Comment is unneces sary. ' Joe Hudson, who sheds so many bitter scalding tears lest the full legal tender paper currency in which the supreme council of the Farmer's alii-. ance proposed that pensions to old soldiers should be paid may be de preciated, has never a word to say in condemation of the act of a Republi can congress by which the currency in which they were paid while in ac tual service was PURPOSELY de preciated, and the vast amount of which they were robbed by act of Congress was transferred to the ca pacious pockets of the bondholders. O, consistency ! What a fraud ! Probuctive labor creates all there is of wealth and this wealth is ex changed by means of money which is a creature of law. Under our mone tary system a few control the distri bution of money and charge enough for its use to absorb the lion's share of the wealth created by the many. Hence the wealth produaer grows , poor while money lenders and specu lators in labor's products amass mil lions. This condition of affairs admits of but one remedy. The pro ducers of wealth, the great mass of the people, whose will, legally ex pressed, is the law, must control the issue and the distribution of the medium by which the wealth created by their labor is exchanged.