per cent. interest by transferring their capital
to New York.
Then there comes in another grave ques-
tion. Your savings banks in the State of
Maryland have deposits from poor people,
and in the city of Baltimore, one of them
has deposits solely from poor people, rang-
ing from five dollars up lo a thousand; and
in the aggregate, it amounts to millions of
dollars. That money must be employed by
the bank, and by law at six per cent. interest.
Out of that has to come the hire of the clerks
of the bank, much increased beyond what it
was at the time when living was less expen-
sive than now. The tax of the United States,
and the tax of the State of Maryland, must
be paid out of that six per cent. So that
when the time comes for the bank to declare
its extra dividend, the poor people must be
told that out of this six per cent, the bank
has not been able to make enough to declare
the dividend. All of the money goes to the
pour; not one cent to the men who conduct
the bank, not one cent to any stock, because
there is no stock. All the money they make
goes to the poor who deposit in the bank;
and at six per cent. interest, they cannot
make enough to declare the extra dividend
to the frugal poor who there deposit their
savings.
So far then, from the operation of the
amendment being, as the gentleman from
Howard described it, against the poor people,
it is a benefit to the poor people; because the
bank at seven per cent. would make one per
cent. more, and it would distribute the
money among the poor.
Mr. SANDS. I suppose the poor people are
the stockholders of our banks.
Mr. CUSHING. There are no stockholders
to the savings banks. I am glad the gentle-
man asked the question, because it shows
that he argued the question before the house
without the mere fundamental elementary
knowledge of it. He comes before the house
and treats a question of finance as a question
of stump oratory, or question of antagonism
between the rich and poor, altogether ignor-
ing the fact that by a just use of money the
poor are benefited, ignoring the fact that by
the proper use of money in your State the
majority of the people in your State must be
benefited. He treats it as a question of ora-
tory, forgetting that the judicious use of
money for the interest of the moneyed class, is
also tor the interest of the laboring class;
that as soon as yon depress the use of money,
and drive money out of the State, your
poorer classes go down; making no distinc-
tion between the question of the appointment
of an attorney general, and the question of
dealing with the finances of your State; as
if to the people of your State the questions
were synonymous at all, to be treated in the
same way, or to be argued on the same
grounds. It is to be expected that in the |
formation of a constitution, gentlemen shall
give a consideration to questions in some
direct ratio to the importance and character
of the questions themselves, and not take
everything as a case of declamation before
the body, and to be treated under political
prejudices.
The gentleman from Kent (Mr. Chambers)
introduced, or gave notice of anamendment
which, after an argument against the injuri-
ous effects of an unlimited rate of interest
give's up the whole principle, and allows an
indefinite rate of interest always to be
charged. Examine it, and see if that is not the
effect of it. The gentleman declares that it is
utterly indifferent to him whether six or
seven per cent. is charged.
Mr. CHAMBERS. Not indifferent. I said I
preferred six to seven; but objected particu-
larly to the additional authority legalizing
any rate agreed upon.
Mr. CUSHING. The provision which the
gentleman introduced to take the place of
that second clause, is a provision that in all
cases the borrower shall pay all the United
States, all the State, and all the county taxes.
That is to say, every man in your community
that loans money shall forever be free from
all share in your taxes; that he shall always
be released by law—
Mr. CHAMBERS. It is not an obligation
but an authority.
Mr. CUSHING. Because the amendment
proposed here gives only authority to make
such contracts, and not an obligation, do you
suppose th at the lender would not always
force the borrower to pay the tax? They
will always do it. Is it not human nature,
that when you give authority to enforce the
payment of the taxes by the needy man, he
will always pay them? The provision of the
gentleman from Kent is eminently wise, for
the interest of bank stockholders, and emi-
nently unwise with regard to any other class
of people.
The amendment as proposed, to raise the
interest to seven per cent., protects the in-
terest of the stockholder of the banks; yet it
does not throw upon the borrower from the
bank the onus of paying all those taxes. In
any bank the money used is not the capital
of the bank, but the deposits in the bank.
You would then halve the deposits in the bank
used by the bank, not paying one cent of taxes
from the bank, but rolling up dividends to the
stockholders in property amounting in some
cases to five or six times their capital. For
instance, a bank has a capital of one million,
and deposits amounting to five millions of
dollars; and uses the whole deposits to loan,
on which it receives interest at six per cent.
Under the provision of the gentleman from
Kent, it would receive on the capital loaned,
in addition to the six per cent., the United
States tax upon the bank, the State tax upon
the bank, the county tax upon the bank, and |
