cent. because he thinks money is fairly worth
it, or simply because the legislative body of
the great State of New York, the moneyed
centre, fixed the rate of interest at that rate.
Mr. ABBOTT. Will the gentleman allow
me a question"
Mr. SANDS. Yes, sir.
Mr. ABBOTT. If the government is paying
seven and three-tenths per cent., can I borrow
money at six per cent. while the government
is in the market ?
Mr. SANDS. I can get as much money as I
want to-morrow at six per cent.; and so can
you, I have no doubt. Take up your paper
to-day, and you can have the money to-
morrow,
Mr. NEGLEY. Does the gentleman mean
to say or to insinuate that the credit of the
government is not as good as his ?
Mr. SANDS. Did the gentleman say or in-
sinuate so ?
Mr. NEGLEY. That is the result of it.
Mr. SANDS. The gentleman says and means
to say, that the reason why the government
is paying this is because the local legislation
of New York fixed the rate of interest at that;
and the government in its necessities was
forced into the market, and had to pay their
price. I ask gentlemen this question. Sup-
pose the legislature bad fixed the rate of in-
terest at six percent, and no more, would the
government be asking loans at seven and
three-tenths per cent, ?
Mr. NEGLEY. Has not New York paid seven
per cent. for twenty years? And did not the
government borrow money at five per cent. ?
Did the seven per cent. of New York then
compel the government to give seven per
cent. or five?
Mr. SANDS. The government has borrowed
money I believe, as low as four and a half
per cent., borrowed it from New York capi-
talists. Bat what is the result? Gold is at
two fifty to-day. Do you, as a loyal man,
say there is just ground for this? it is not
true. Look how it operates. The govern-
ment borrows five hundred millions in New
York. The legal price upon that, suppose it
to be six per cent. or five per cent.—I will
assume it to be five per cent., taking the
gentleman's figures—and the interest upon
five hundred millions will be twenty-five
millions of dollars. These money people, who
always take care of their own interest,
get this interest paid in gold. What do they
do with the twenty-five millions paid them
by the government of the United States
in gold? They control the money market
of the country, forcing gold up to its pres-
ent prices. They get their twenty-five mil-
lions of dollars of interest, and go right
down into Wall street, and for that gold
they ask and receive sixty-two and a half
millions of dollars. How much per cent, is
that on five hundred millions. It is twelve
and a half per cent. That is what they re-
68 |
ceive according to the present rates of gold.
Out of a legitimate interest of five per cent.
upon five hundred millions of dollars which
they hold, these men every year manage to
make sixty-two and a half millions, or twelve
and a half per cent. on their capital. That
is in plain figures. They get their interest
of twelve and a half per cent., and they go
out into the market and buy up government
bonds at par; and the bonds thus purchased
pay them now seven and three-tenths per cent.
That is the secret of the price of gold this
day; that and nothing else.
I am opposed to the amendments from
these considerations, leaving all other con-
siderations entirely out of the case, because
we are all borrowers, all debtors paying in-
terest so long as this government stands. I
am paying my tax, and every man paying
his tax is paying the money lenders, the
usurers, the government interest. I am
therefore interested for myself and for the
people, in fixing the rate of interest so that
it shall not grind the people of the country
further into the dust. Heaven knows we are
burdened enough as it is. Heaven knows
that at six or five per cent. you have got
enough to carry. The people have enough
to pay annually in the way of interest. Your
taxes are only taxes in name; they are inter-
est in fact; and at the present rates of gold
they are interest at twelve and a half per cent.
You propose to raise it still higher. You
propose, lest the people of the United States
should not be sufficiently burdened with
taxes, to raise the rate of interest still higher.
Take the rate of seven and three-tenths per
cent., and make the calculation. I think we
have now a debt of about $2,000,000,000.
At this rate of interest the country will be
forced hereafter for all time to pay $146,000,-
000 annually; and she must double the sum
if she has any hope of the time coming when
the people shall escape from the burden of
the present rate of taxation.
It has been argued here that by not rais-
ing the rate of interest equal to that in New
York, you will keep capital out of the State.
There are also facts to answer this. One
gentleman upon this floor told me he knew
of $10,000,000 looking for investment now
in Maryland, at the present rate of six per
cent. in Maryland lands and Maryland mines,
looking for investment here, in the faith that
Maryland with her resources will become the
little empire she ought to be. In my own
county, for instance, look at the large
amounts of Northern capital, New York city
capital. If my colleague is here he will
assure you that in our county large and
magnificent estates have been bought recently
at half price, and paid for by New York cap-
ital, where they pay seven per cent., brought
here to pay for Maryland lands. Why?
Because they know these lands are going to
enhance in value. The seven per cent. does |
