,,usury3    ,,or    ,,interest1         
,,premium ,,and ,,discount4      ,a     
,,lecture    ,,delivered    ,,before    
,,the ,,students    ,,of                
,,crittenden',s    ,philadelphia        
,commercial ,college1      ,,by    ,s4  
,h4 ,,crittenden1    ,attorney at ,law1 
,,consulting ,,accountant ,,and         
,,principal4      ,,philadelphia3       
,,ringwalt  ,,brown1 ,,steam-,,power    
,,book ,,and ,,job ,,printers1    ,nos4 
#aaa  #aac ,,south ,,fourth ,,street4   
#ahfc4            ,,usury3    ,,or      
,interest1 ,premium and ,discount4      
,a ,,lecture,a    ,,delivered ,,before  
,,the ,,students ,,of    ,,crittenden',s
 ,,philadelphia ,,commercial ,,college1 
,,by    ,s4 ,h4 ,,crittenden1 ,,attorney
 ,,at ,,law1    ,,principal4      ,our  
subject to-day is ,,usury4      ,we will
 first speak of this subject in its     
direct relation to  ,book-,keeping4     
,that is1 as to its treatment under     
different forms1 on  the ,ledger1 since 
this is in reality the phase in which it

 is of most  importance for us to       
consider it4 ,afterwards we will glance 
at the  matter in the view of utility1  
economy and legality4    ,the ledger    
titles which embrace this subject1 are  
,interest1 ,discount  and ,premium4     
,these are all often1 and indeed        
generally1 embodied in one  account1    
headed ,interest1 yet they are radically
 different divisions of  the account1   
both in their nature and manner of      
computation2 although  all tending to   
one point1 when placed upon the         
merchant's books1 viz3  to add to his   
total gains or losses4    ,mc,cullock's 
,commercial ,dictionary has the         
following definitions of  ,interest and 
,discount3    8,interest1 is the sum    
paid by the borrower of a sum of money1 
or of  any sort of valuable produce1 to 
the lender1 for its use40    8,discount1
 is an allowance made on account of an  
immediate advance of  a sum of money1   
not due till some future period40       
,premium1 according to ,webster's       

,dictionary1 is 8a bounty1 or  something
 offered or given for the loan of money1
 usually a sum  beyond the interest40   
,these definitions1 though not full1    
will yet serve as a foundation  on which
 to construct an explanation that may   
make these terms more  easy of          
comprehension4 ,you perceive that in    
order to apply the  definition of       
,interest1 which ,i have quoted1 we must
 look upon every  person who is indebted
 to another1 as a borrower2 that is1 as 
having  in his possession1 certain      
property which belongs of right to that 
other person2 and for retaining the use 
of which he must pay him an  equivalent4
 ,if you consider in this light all     
transactions in which  ,interest is     
demanded and paid1 this portion of the  
subject will perhaps  be sufficiently   
plain without additional comment4    ,it
 is in relation to the second division  
of the account that most  confusion     
usually arises4 ,there are not less than
 three distinct  transactions1 which are

 all included in the usual language of  
business  men1 under the single term    
,discount4 ,they are3    #ast4 ,when a  
deduction is made for payment of a note 
or account before  due2 #b;d4 ,when a   
per centage is taken off from a sale1 in
 consideration  of ready money2 #c;d4   
,when money is remitted from one country
 to another1  at an additional expense  
or at a loss4    ,if at an expense1 it  
is sometimes called ,premium4    ,for   
illustration1 under the #ast division2  
suppose ,a holds a note  against ,b for 
#ejj due in four months1 and ,b comes   
to-day and proffers  payment2 the custom
 is1 for ,a to deduct the interest on   
#ejj for four  months1 from the face of 
the note2 and to accept the balance as  
payment  in full3 thus considering the  
use of the remainder of the amount1     
sufficient to compensate for the        
deficiency in the payment of the face   
of the bill4 ,but this is manifestly    
incorrect1 if we take the existing  law 
of this ,state1 which declares the value

 of the money to be but six  per cent4  
per annum1 to be founded on just        
principles4 ,for the interest  on the   
remainder of the note1 after deducting  
the interest on the face  of the note   
therefrom1 is not sufficient at the same
 rate per cent4 to  make up the original
 sum4 ,so that ,b1 by paying thus in    
advance1 secures  a larger rate of      
interest than is lawful4 ,yet this is   
the usage1 and  it is an old adage1 and 
well established1 that usage makes law4 
,this  is what is termed ,bank          
,discount4 ,true ,discount1 is such a   
sum1 as1  when deducted from the        
original debt1 the interest on the      
balance will  just equal the amount     
deducted4 ,the method of ascertaining   
this is by  proportion1 or1 as it is    
called in arithmetics1 rule of three4   
,thus  we would say1 as the amount of   
#ajj4 and interest for the given time   
and rate is to the interest on #ajj4 for
 the same time and rate1 so  is the     
total sum to the amount of discount to  

be deducted therefrom4  ,stated thus1-- 
#ajb4jj 3 #b4jj 33 #ejj4jj 3 the answer4
    #b;d4 ,if ,c sells goods to ,d and  
within a certain limited time1 usually  
among the jobbing trade of our city #cj 
days after purchase1 ,d pays for  them  
in cash1 usage again allows him a       
deduction from the face of the  invoice 
of say #e per cent4 ,this is also called
 ,discount1 but it is  not properly     
such4 ,for it is only a deduction of    
such a proportion or  per centage of the
 bill1 on fulfillment of certain        
conditions2 while  ,discount is reckoned
 with reference to time to run1 as well 
as rate per  cent42 in fine1 ,discount  
is simple ,interest paid beforehand4    
#c;d4 ,the term ,discount is also       
applied to that sum which is advanced   
beyond or deducted from the amount of a 
debt1 in remitting money from  one      
country to another4    ,thus1 if ,i wish
 to remit a sum of money to any foreign 
country1 it is  needful for me to       
ascertain what is the difference of     

valuation at the  present time between  
money of the denominations used and     
ordinarily  obtainable here1 and those  
in the country to which the remittance  
is  to be made4 ,this valuation ,i      
suppose you all understand is a merely  
arbitrary one1 fixed at the will of the 
supreme power in any ,state1 and        
varying according to circumstances and  
the ideas of the law makers4 ,if1  for  
instance1 owing to the different amounts
 of alloy used in coining  pieces of    
corresponding value in different        
countries1 there is say #e  per cent4   
more precious metal in the coin of that 
country to which ,i  wish to remit than 
in that of our own country1 ,i must     
necessarily pay  this difference in     
addition to the original sum1 in order  
to render  the account of my            
correspondent good according to the     
valuation in his  country4 ,if on the   
other hand the intrinsic value of our   
coin is #e per  cent4 the greater1 then 
one hundred dollars of our coin will pay

 one  hundred and five dollars of the   
other4    ,the proper term for this is  
,exchange1 and if this name were        
universally adopted1 there would be far 
less of confusion in the ideas          
associated with such transactions1 in   
the minds of most persons4    ,we will  
now turn to a consideration of the      
peculiar nature of ,interest1  or more  
properly ,usury1 and the reasons        
assigned for a limitation of  its rate  
by law4 ,formerly1 the amount received  
in payment for the loan  of capital1 was
 denominated ,usury2 that is to say1    
rent for its use and  enjoyment4        
,this is the correct term1 for ,interest
 is only the rent1 or price paid  for   
the enjoyment of an object of value4    
,but this word has acquired an odious   
meaning1 and is now understood to       
express an illegal and oppressive rate  
of interest only1 the milder but  less  
expressive term being substituted by    
common usage4    ,in earlier times1     
before the advantage and utility of a   

reserve  capital was known and          
appreciated1 the demand of a rent for   
its use  by lenders1 was looked upon as 
an abuse of power1 and an oppression    
towards the needy4 ,and1 more still1 it 
seems from the accounts handed  down to 
us by the writers of those days1 that   
even that frugality1  without which     
capital cannot be amassed1 was looked   
upon as parsimony1  and deemed a public 
injury1 by the populace1 who looked upon
 all sums  not spent by the great       
proprietors1 as lost to themselves4     
,they could  not comprehend that money  
laid by1 as a capital for some          
profitable  employment1 was to all      
intents equally spent2 and that to in a 
way  far more beneficial to the poor4   
,for a laboring man is never sure of    
earning a subsistence save where there  
is a capital in reserve for  him to work
 upon4 ,this inability to understand its
 use gave rise to  strong prejudice     
against rich individuals1 who do not    
spend their whole  income as it comes   

in2 such a feeling still exists to a    
great extent3  formerly it was          
universal4 ,lenders themselves were     
infected by it1 and  were so much       
ashamed of the part they were acting as 
to employ the most  disreputable agents 
in the collection of profits perfectly  
just1 and  highly useful to society4    
,there have been from time to time      
various species and modifications of    
statutes1 and enactments for the        
promotion of public liberty1 and the    
advancement of happiness1 both private  
and public4    ,yet1 though these       
ordinances have been provided in all    
good faith1 by  the legislators1 it is  
evident to every person who observes    
closely1  and compares causes and       
effects1 that oftentimes their operation
 is  inefficient for the end aimed at2  
and often directly the reverse in       
effect from the original intention of   
their makers4 ,especially1 it  seems to 
me1 is this the case in the matter of   
those laws relating to  ,usury4         

,there exists almost universally1 a sort
 of hereditary prejudice against  the   
very name of ,usury4 ,almost every one  
will plead guilty to such  feelings as  
these3 8,usury is a bad thing1 and as   
such ought to be  prevented2 ,usurers   
are a bad sort of men1 a very bad sort  
of men1 and  as such ought to be        
punished and suppressed40 ,now1 it is   
not wonderful  that men fall into such  
opinions1 and become firmly grounded in 
them1  when they hear them handed down  
and repeated by those to whom they are  
in the habit of looking with confidence 
for correct ideas4    ,for it cannot be 
expected that the mass of mankind should
 find leisure1  even had they the       
ability1 to examine into the grounds of 
a hundredth  part of the rules and      
maxims which they find themselves       
compelled to  follow and observe4 ,the  
fact is1 that wherever it has been      
attempted to  limit the rate of         
,interest1 or to abolish it altogether  
by law1 there  the practice of ,usury   

has uniformly revived4 ,and1 as might   
naturally  be expected1 the more severe 
the penalties1 and the more rigid their 
execution1 the higher the rate of       
interest was sure to rise4 ,because  the
 risk being so much greater1 the lender 
must needs have a larger  premium of    
insurance to tempt him to incur it4 ,it 
is a matter of  history1 that at ,rome1 
during the continuance of the republican
 form of  government the rates of       
interest were enormous4 ,the simple and 
plain  reason of this was1 that the     
debtors who were always plebeians1 were 
continually threatening their patrician 
creditors4    ,so also1 in those        
,christian countries where ,interest on 
loans has been  forbidden1 or what is   
equivalent1 where it has been placed by 
law  at so low a point as would not     
suffice to pay the risk of loss to a    
lender1 the practice has been made over 
almost entirely to the ,jews2  while at 
the same time so great has been the     
extortion1 oppression1 and  humiliation 

to which this people were exposed that  
nothing short of a  very heavy rate of  
,interest could indemnify them for such 
risks and  repeated losses4    ,thus in 
any case the ratio of the ,premium of   
insurance1 which  frequently forms the  
greater portion of what is called       
,interest1 will  depend upon the degree 
of security presented to the lender4    
,the greater  the risk1 the higher will 
be the rate of ,interest4 ,when we      
detach from  the rate of interest all   
that is paid as a security to the lender
  against the risk of partial or total  
loss of his capital1 it remains to      
consider that part which is purely and  
simply ,interest3 that is to say1  rent 
paid for the use of capital4    ,this is
 the point upon which many wise         
legislators have endeavored to  lay down
 laws as infallible guides1 and many    
learned economists have  advocated such 
restrictive enactments1 as even to this 
day obtain in  most civilized countries4
 ,the ,romans seem1 according to ,cato1 

to  have considered an ,usurer1 as worse
 than a thief4 ,for1 says he1 8,our     
,ancestors1 enacted in their laws1 that 
a thief should be condemned to  pay     
double1 but an ,usurer1 quadruple40     
,even that most learned commentator on  
law1 ,sir ,henry ,blackstone1           
pronounces that a legal limit ought to  
be placed to this branch of  trade4     
,i will quote from ,blackstone1 on this 
subject4 ,he says1 when speaking  of the
 general points in the contract of      
hiring and borrowing3 #b ,com41  p4     
#ded1 8,there is one species of this    
price or reward1 the most usual  of any1
 but concerning which many good and     
learned men have in former  times very  
much perplexed themselves1 and other    
people1 by raising  doubts about its    
legality in foro conscientie4    8,that 
is1 when money is lent on a contract1 to
 receive not only the  principal sum    
again1 but also an increase by way of   
compensation for  the use2 which is     
generally called ,interest by those who 

think it  lawful1 and ,usury by those   
who do not so2 for those enemies to     
,interest1 in general1 make no          
distinction between that and ,usury1    
holding any increase of money to be     
indefensibly usurious4 ,and this  they  
ground1 as well on the prohibition of it
 by the law of ,moses among  the ,jews1 
as also upon what is said to be laid    
down by ,aristotle1 that  money is      
naturally barren1 and to make it breed  
money is preposterous  and a perversion 
of the end of its institution1 which was
 only to serve  the purposes of         
,exchange1 and not of increase4 ,hence  
the school divines  have branded the    
practice of taking ,interest as being   
contrary to the  divine law1 both       
natural and revealed3 and the canon law 
has proscribed  the taking any1 the     
least1 increase for the loan of money1  
as a mortal  sin4    8,but in answer to 
this it hath been observed1 that the    
,mosaical precept  was clearly a        
political1 and not a moral precept4 ,it 

only prohibited  the ,jews from taking  
,usury from their brethren1 the ,jews3  
but in  express words1 permitted them to
 take it of a stranger2 which proves    
that the taking of moderate ,usury1 or a
 reward for the use1 for so the  word   
signifies1 is not malum in se1 7a sin in
 itself considered17  since it was      
allowed where any but an ,israelite was 
concerned4 ,and  as to the reason given 
by ,aristotle1 and deduced from the     
natural  barrenness of money1 the same  
may with equal force be alleged of      
houses1 which never breed houses2 and   
twenty other things1 which nobody       
doubts it is lawful to make profit of1  
by letting them to hire4    8,and though
 money was originally used only for the 
purposes of  exchange1 yet the laws of  
any ,state may be well justified in     
permitting it to be turned to the       
purposes of profit1 if the  convenience 
of society1 7the great end for which    
money was invented17  shall require it4 
,and that the allowance of moderate     

,interest tends  greatly to the benefit 
of the public1 especially in a trading  
country1  will appear from that         
generally acknowledged principle1 that  
commerce  cannot subsist without mutual 
and extensive credit4 ,unless money1    
therefore1 can be borrowed1 trade cannot
 be carried on3 and if no  ,premium were
 allowed for the hire of money1 few     
persons would care to  lend it2 or1 at  
least1 the ease of borrowing at a short 
warning1 7which  is the life of         
commerce17 would be entirely at an end4 
8,and as to any scruples of conscience1 
since all other conveniences  of life   
may be either bought or hired1 there    
seems to be no greater  oppression in   
taking a recompense or price for the    
hire of this1 than  of any other        
convenience40    ,for the taking of such
 recompense we have moreover1 the very  
highest  authority in the words of our  
,saviour1 who1 in the parable of the    
talents1 censures the slothful servant  
in these words3 8,thou wicked  and      

slothful servant1 thou knewest that ,i  
reap where ,i sowed not1 and  gather    
where ,i have not strewed4 ,thou        
oughtest therefore to have put my  money
 at the exchangers1 and then at my      
coming ,i should have received  mine own
 with ,usury40    ,dr4 ,adam ,smith1 in 
his work entitled 8,wealth of ,nations10
 ,vol4 #a1  p4 #dbi1 published in #aggf1
 and which has been long a text book for
  political economists1 says3 8,a       
capital lent at ,interest may1 in this  
manner1 be considered as an assignment  
from the lender to the borrower  of a   
certain considerable portion of the     
annual produce2 upon condition  that the
 borrower in return shall1 during the   
continuance of the loan1  annually      
assign to the lender a smaller portion1 
called the ,interest2  and at the end of
 it a portion equally considerable with 
that which had  originally been assigned
 to him1 called the repayment4 ,though  
money1  either coin1 or paper1 serves   
generally as the deed of assignment1    

both  to the smaller and to the more    
considerable portion1 it is of itself   
altogether different from what is       
assigned by it40 ,and again3 8,as such  
capitals are commonly lent out1 and paid
 back in money1 they constitute  what is
 called the monied interest40 8,in some 
countries the ,interest of  money has   
been prohibited by law4 ,but as         
something can everywhere be  made by the
 use of money1 something ought          
everywhere to be paid for the  use of   
it4 ,this regulation instead of         
preventing1 has been found from         
experience1 to increase the evil of     
,usury2 the debtor being obliged  to    
pay1 not only for the use of the money1 
but for the risk which his  creditor    
runs by accepting a compensation for    
that use4 ,he is obliged1  if one may   
say so1 to insure his creditor from the 
penalties of ,usury40    8,in countries 
where ,interest is permitted1 the law1  
in order to prevent  the extortion of   
,usury1 generally fixes the highest rate

 which can  be taken without incurring a
 penalty4 ,this rate ought always to be 
somewhat above the lowest market price1 
or the price which is commonly  paid for
 the use of money by those who can give 
the most undoubted  security40    8,if  
this legal rate should be fixed below   
the lowest market rate1 the  effects of 
this fixation must be nearly the same as
 those of a total  prohibition of       
,interest40    8,the creditor will not  
lend his money for less than the use of 
it  is worth1 and the debtor must pay   
him for the risk which he runs by       
accepting the full value of that use4   
,if it is fixed precisely at the  lowest
 market price1 it ruins1 with honest    
people1 who respect the laws  of their  
country1 the credit of all those who    
cannot give the very best  security1 and
 obliges them to have recourse to       
exorbitant usurers40    8,the legal     
rate1 it is to be observed1 though it   
ought to be somewhat  above1 ought not  
to be much above the lowest market rate4

 ,if the  legal rate of interest in     
,great ,britain1 for example1 were fixed
 so  high as eight or ten per cent4 the 
greater part of the money which was  to 
be lent1 would be lent to prodigals and 
projectors1 who alone would  be willing 
to give this high rate of ,interest4    
,sober people1 who will  give for the   
use of money no more than a part of what
 they are likely  to make by the use of 
it1 would not venture into the          
competition4 ,a  great part of the      
capital of the country1 would thus be   
kept out of the  hands most likely to   
make a profitable and advantageous use  
of it1 and  thrown into those most      
likely to waste and destroy it4 ,where  
the legal  rate of ,interest1 on the    
contrary1 is fixed but a very little    
above the  lowest market rate1 sober    
people are universally preferred as     
borrowers  to prodigals and projectors4 
,the person who lends money gets nearly 
as  much ,interest from the former1 as  
he dare take from the latter1 and  his  

money is much safer in the hands of the 
one set of people1 than  in those of the
 other4 ,a great part of the capital of 
the country is  thus thrown into the    
hands in which it is most likely to be  
employed  with advantage4 8,no law can  
reduce the common rate of ,interest     
below  the lowest ordinary market rate  
at the time when that law is made4      
,notwithstanding the edict of #agff1 by 
which the ,french king attempted  to    
reduce the rate of ,interest from five  
to four per cent41 money  continued to  
be lent in ,france at five per cent43   
the law being evaded  in several        
different ways40    ,puffendorf1 whose  
treatise on the 8,laws of ,nature and of
 ,nations10 was  published in ,england  
in #agaj1 says3 8,the arguments which   
are brought  against ,usury are easily  
answered4 ,it is urged that the loan of 
a  consumable commodity ought to be     
given gratis1 because the loan of all   
other things is so4 ,but ,i answer that 
,i have the power of granting the  use  

of my goods that are not consumable     
either gratis1 or for rent3  whereof1   
the one is a loan1 the other a letting4 
,so what should  hinder me from granting
 the use of my money also1 either       
gratis1 or  for a certain recompense8   
,when one man borrows to increase his   
wealth1  or improve his condition1 why  
should another lend to him for nothing8 
,nay1 'tis an unreasonable thing1 when  
you vastly improve your fortune  with my
 money1 not to admit me to some share of
 the gain4 ,for ,i1 in  the meantime1 am
 debarred from making that advantage    
which ,i might  have otherwise expected1
 by applying it to my own use4 ,besides1
 ,i have  parted with something         
valuable1 which ought therefore to be   
considered3  for in lieu of my money1 ,i
 have only an action against your       
person1  which cannot be prosecuted     
without some trouble4 ,it may also      
happen  by some accident that the debt  
may be lost4 ,nay1 sometimes the debtor 
must be courted and caressed1 that it be

 not lost4 ,and some borrow on  purpose 
to make their creditors dependent on    
them4 ,as1 the ,marechal de             
,rochelause1 when he was taxed by ,louis
 ,,xiii4 with taking part with the      
,duke of ,mayenne1 pleaded in excuse1   
that he did not follow the ,duke1  but  
his money3 for his debt would be in a   
desperate condition if he did  not stick
 close to his debtor4    8,besides1 it  
is not seldom that we lend to persons   
who are utterly  unable to pay2 and     
therefore some are of the opinion that  
it would be  for the advantage of the   
public1 to allow none but merchants to  
take  up money at use2 for this would   
make the poor industrious1 and force    
them to frugality1 who1 some of them1   
are not afraid to pay ,interest  for    
money to maintain their extravagancies4 
,and monied men1 rather than  let their 
money lie dead1 would either take to    
merchandise themselves  or would put out
 their money to those who do3 which     
would make trade  flourish to the great 

benefit of the commonwealth4    ,grotius
 is of the opinion1 8that the legal     
interest ought to be stated1  not       
according to the gains of the borrower1 
but the loss that thereby  accrues to   
the lender3 as in buying and selling1   
and other contracts1  no regard is had  
to what the receiver may make of the    
commodity1 but  what goes away from the 
seller40    8,and in this case so much  
goes away as every man in his own       
calling  might1 and usually does1 make  
of his money2 allowance being made for  
hazards1 which in some cases are more1  
and in others less4 ,with this1  ,i so  
far agree3 that no man can complain1 if 
his debtor makes a vast  and unexpected 
return of his money2 but yet there is no
 doubt but ,i may  demand higher        
,interest of him that makes a very      
gainful trade1 than ,i  can of another  
who drives a poor one40    ,these are   
the opinions of men learned in the      
science of political  economy2 and are  
entitled to weighty consideration2 but  

it seems to me1  they do not1 any of    
them1 reach quite far enough into the   
subject4 ,all  of them appeared to be   
fettered by the pressure of that same   
generally  recognized opinion to which  
,i have before adverted4    ,the        
proposition ,i am inclined to favor on  
this much mooted point is  aptly        
expressed in the words of ,jeremy       
,bentham4 ,it is1 8that no man of  ripe 
years1 and of sound mind1 acting freely1
 and with his eyes open1  ought to be   
hindered1 with a view to his advantage1 
from making such a  bargain in the way  
of obtaining money1 as he thinks fit1   
nor1 7what is  a necessary consequence17
 anybody hindered from supplying him1   
upon any  terms he thinks proper to     
accede to40    ,there are but two       
definitions which can be given to       
,usury4 ,one is1  taking a larger rate  
of ,interest than the law allows2 this  
is the  legal or1 political definition4 
,the other is taking more ,interest     
than is usual for other people to give  

and take2 this is the moral  one4 ,and  
now1 in order that the law may touch the
 point1 and actually  prohibit ,usury1  
it is needful first that the law should 
supercede  morals1 or conventional      
custom1 and fix that point4    ,one     
thing is certain1 that antecedently to  
custom1 which has grown  to be          
established conventionally1 there could 
not be such a thing as  ,usury4 ,for    
what rate of interest is more right than
 another8 ,in one  land ten per cent4 is
 the legal and therefore 7as the        
advocates of  limitation would say7 the 
proper rate2 in an another five per     
cent4 is  the utmost which the tender   
consciences of the legislators will     
allow4  ,even in the same country1 from 
time to time1 the rates are and have    
been varied as the wants of the         
community1 the exigencies of the times1 
or the whims of the legislators         
prompted4    ,it is1 then1 convenience  
which has produced whatever there is of 
custom in the matter4 8,and what1 7asks 

,bentham appropriately17 is  there in   
custom1 to make it so much more         
deserving of observance than            
convenience1 which first gave it birth80
    ,it is convenient for me to give #h 
per cent4 for money4 8,no10 says the    
law1 8you shall not40 ,why8 8,because it
 is not convenient for your  neighbor to
 give more than #f per cent4 for it40   
,can anything be more  absurd8    ,then 
again1 as to the opprobrious name4 ,no  
appellation or particular  stigma of    
disrepute affixes to a man who being the
 owner of a house1  gets as high a rent 
for it as he can4 ,indeed this is the   
common  practice with such persons1 and 
nobody is ashamed to do so1 or          
professes to do otherwise4 ,now1 why a  
man who possesses money1 and  takes as  
much as he can get for it1 say #h1 #aj  
or #ab per cent4 should  be loaded with 
vile epithets1 any more than if he had  
bought a house  with it1 and then made  
the same profit from renting the house1 
is more  than ,i can see4    ,another   

point1 in which the good policy of the  
existing restrictive  laws upon this    
subject1 seems doubtful1 is that they   
operate in only  one direction4 ,if it  
is wrong1 and worthy of punishment1 to  
take more  than the fixed maximum of    
interest for the use of money1 why not  
make  it a penal offence to offer less  
than that amount1 as well as to  accept 
more8    ,there are divers reasons given
 by the advocates of the laws           
restricting  the rates of ,interest why 
they are beneficial and ought to be     
enforced4  ,among these are3 that they  
prevent prodigality1 and protect the    
poor  and simple from extortion and     
imposition4    ,as to preventing        
prodigality3 does not every one know    
that so long  as a person has money1 or 
property of any sort1 with which it is  
possible for him to display prodigality1
 no ,usury laws will stop him  from     
expending it2 and1 that after his       
property is gone and he has no  more to 
expend1 none are more ready to promise  

the largest ,interest1  providing he can
 thereby obtain additional money to     
spend8 for what he  gets is clear gain1 
he having nothing to lose4 ,this1 it    
would seem is a  hopeless class1 for    
whose protection or advantage to        
legislate4    ,besides prodigals1 there 
are three other classes1 to whose       
benefit such  restrictive laws are      
supposed by their authors to insure4    
,they are the  indigent1 the rashly     
enterprising1 and the simple4 ,that is  
to say1  those whose pecuniary          
necessities are so pressing1 as to      
render them  willing to pay an          
,interest1 above the ordinary rate1     
rather than not  to have the money2     
those who from rashness1 may be disposed
 to venture  upon the giving such a rate
 without duly considering the           
consequence2  and those whose natural   
carelessness combined with ignorance    
would lead  them to acquiesce in it4    
,let us look at the conditions of these 
classes a few moments4 ,here  is a small

 trader we will say1 whose stock in     
trade consists of only  a small amount  
of property1 combined with an1 as yet1  
perfectly  untarnished reputation for   
punctuality in payments4 ,this last1 all
  who know anything of business1 will at
 once admit to be the principal1  and   
most important item of his stock4 ,for  
with such a character1 no  merchant will
 refuse to credit him for articles      
needful to carry on his  business2 and  
thus all goes well with him4    ,but now
 his carefully cherished credit is in   
danger4 ,he has been  disappointed in   
his expectations of a ready sale for    
some part of his  goods1 or in obtaining
 money promised him for a debt1 and     
finds himself  without the means to     
promptly meet an obligation falling due 
to-morrow4    ,his position is such in  
the matter of property as not to render 
it  worth anybody's while to lend him at
 the legal rate2 in short he  cannot    
raise money to meet this obligation at  
that rate1 and must do  one of two      

things--either lose his credit1 which   
will ruin utterly  his prospects of     
making a comfortable subsistence for his
 family2 or  he must obtain the means of
 saving this cherished treasure intact1 
by  paying somewhat more for the use of 
the money4 ,we can at once see what  he1
 who has every motive and means for     
judging rightly in the matter1  would   
decide to be the wisest course1 and the 
one nearest the path of  rectitude4 ,as 
a matter of course1 if he could obtain  
the money at a low  rate1 he would not  
pay the higher one4 ,but now the        
legislator who knows  nothing of any of 
these circumstances1 but whose heart    
overflows with  prudence1 and loving    
kindness for the poor man1 steps in1 and
 says3 8,it  signifies nothing2 you     
shall not have the money1 for it would  
be doing  you a mischief to allow you to
 borrow on such terms40 ,there might be 
worse cruelty1 but not easily greater   
folly4    ,next1 in regard to the       
ignorant and simple1 for whose          

protection from  imposition or fraud1   
these laws are enacted4 ,first1 could   
any degree  of simplicity or want of    
tact be greater or more evident than    
that  displayed in such a case as we    
have just spoken of2 where a legislator 
could confine a man under such          
circumstances1 to a given rate of       
,interest8    ,second1 suppose the      
wisdom of the legislator to be never so 
much  greater than that of the          
individual1 no matter how weak that may 
be1  how useless is the exertion of it  
in this case only1 while there  remains 
so many other occasions where the       
simplicity of the sufferer  would make  
him the victim of injustice1 and where  
the legislator cannot  interpose to     
protect him4 ,in every day affairs1 in  
the matter of buying  and selling1      
whether with money1 or on credit1 such  
persons are liable  to be overreached2  
and yet none have thought that for this 
reason1 a  legal price ought to be set  
upon all goods1 of whatever description4

  ,nor1 supposing that even this endless
 undertaking were accomplished by  the  
legislator1 would it avail anything     
unless he also should regulate  the     
exact amount of each article which each 
man should buy4    ,when matters arrive 
at this point1 we find the person in the
 position  of those for whom the law    
provides entirely1 as not being fit to  
take  care of themselves3 such are      
usually denominated idiots4    ,and now1
 as we have considered at some length   
the needlessness and  inefficiency of   
such legislation1 let us for a few      
moments1 look at  some of its evil      
results4    ,we will speak at first of  
those who are by this means virtually   
prohibited from obtaining money on      
loans4 ,consider for a moment1 what     
distress and inconvenience it would     
produce were the privilege of  borrowing
 denied to everybody4 ,just that        
inconvenience is occasioned to  those   
people whose security would1 if they    
were allowed to add a little  of the    

rate of ,interest1 be sufficient to     
obtain the needed funds1  but is not    
sufficient for that purpose when such   
liberty is denied4  ,thus the misfortune
 of not happening to be possessed of    
that amount of  property which is       
considered a sufficient security1 is    
made the ground1  under such            
legislation1 of inflicting hardships    
upon a man1 which those  who are so     
fortunate as to have such security do   
not suffer4    ,the only point of       
distinction between the two classes1 is 
that the  necessity of one is greater   
than that of the other4 ,for were this  
not  the case1 they would not be        
willing1 as we have supposed1 to pay    
more  to be rid of it4    ,another ill  
effect1 is that of rendering the terms  
of obtaining money  so much the worse   
for many whose circumstances are such   
that they are  not altogether precluded 
from obtaining it1 at some rate4 ,those 
who  cannot borrow1 may get what they   
want1 so long as they have anything  to 

sell4 ,but1 while out of loving         
kindness1 or other motive1 the law      
precludes a man from borrowing1 upon    
terms too disadvantageous1 it  does not 
forbid him from selling at any1 even the
 most ruinous rates4    ,everybody knows
 that forced sales are attended with    
loss3 and to this  loss an amount of    
,interest1 which would at first seem    
exorbitant1 would  bear but a small     
proportion4    ,when a man's goods are  
taken1 and sold under an execution1 it  
is  considered a good sale if the net   
amount reaches two-thirds what it  would
 take to replace them again4 ,in this   
way the kindness of the law1  costs him 
directly #cc-a_/c per cent4 at least2   
supposing1 what is seldom  the case1    
that no more property was taken than    
just enough to satisfy  the claim4 ,now1
 if he had been permitted to hire the   
money at1 say #ab  per cent4 per annum  
it would require nearly three years for 
the same  amount to accrue1 as interest1
 while the probabilities are that he    

would be able to pay off the whole debt 
long before the expiration of  that     
period4    ,to the laws prohibiting     
,usury1 too1 we may look1 as the prime  
cause  of the establishment1 and the    
strongest supporter of that branch of   
business1 which is ordinarily looked    
upon as so disreputable1 and at  whose  
door are laid so many and grievious     
complaints of oppression1  c41 viz3     
pawn-broking3--a business based only on 
the unsatisfied wants  and necessities  
of that very class for whose protection 
from imposition  such laws are made4    
,so we might multiply cases and         
arguments1 but perhaps sufficient has   
already been said to lead those who     
think1 to the conclusion that is        
embodied in our proposition3 viz3 that  
every man ought to have the  same right 
to buy and sell money at a profit1 as he
 has to do so with  merchandise or other
 property4      ,illustration3          
,,crittenden',s ,,philadelphia          
,,commercial ,,college4    ,established1

 #ahdd4 ,incorporated1 #ahee4           
,,footnote3    ,a ,entered according to 
,act of ,congress1 in the year #ahfc1 by
 ,s4  ,h4 ,crittenden1 in the ,clerk's  
,office of the ,district ,court1 for the
  ,eastern ,district of ,pennsylvania4  
,,transcriber',s ,,notes3               
,italicized text is surrounded by       
underscores3 italics4      ,obvious     
typographical errors have been          
corrected4      ,archaic or alternate   
spelling has been retained from the     
original4