Benjamim Tucker on "usery" and the state...

[FrankChodorov]

Tucker was not primarily concerned about particular wrongs; he wanted to correct the system that generates and makes possible individual wrongs...his position regarding the State and money monopoly derived from his Socialist convictions.

today Socialism has degenerated into a doctrine of totalitarian Statism, but in the 19th Century the term referred to an intent to fundamentally reorganize the societal systems so as to return the full product of labor to the laborers. In 1881 this intent was formulated in a New York newspaper: "Somebody gets the surplus wealth that labor produces and does not consume. Who Is the Somebody?" Tucker answered:

    What are the ways by which men gain possession of property? Not many; Let us name them: work, gift, discovery, gaming, the various forms of illegal robbery by force or fraud, usury . . . .

    Is the Somebody the laborer? No; at least not as laborer; otherwise, the question were absurd. Its premises exclude him . . . .

    Is the Somebody the beggar, the invalid, the cripple, the discoverer, the gambler, the highway robber, the burglar, the defaulter, the pickpocket, or the common swindler? None of these, to any extent worth mentioning . . . . These people get some of the wealth . . . but labor can spare them the whole of it, and never know the difference.

    Then we have found him. Only the usurer remaining, he must be the Somebody whom we are looking for; he and none other. But who is the usurer, and whence comes his power? There are three forms of usury: interest on money, rent of land and houses, and profit in exchange. Whoever is in receipt of any of these is a usurer. And who is not? Scarcely anyone. The banker is a usurer; the manufacturer is a usurer; the merchant is a usurer; the landlord is a usurer; and the working man who puts his savings, if he has any, out at interest, or takes rent for his house and lot, if he owns one, or exchanges his labor for more than an equivalent - he too is a usurer. The sin of usury is one under which all are responsible. But all do not benefit by it. The vast majority suffer. Only the chief usurers accumulate: in agricultural and thickly settled countries, the landlords; in industrial and commercial countries, the bankers . . . .

    And where do the Somebodies get their power? From monopoly. Here, as usual, the State is the chief of sinners. Usury rests on two great monopolies - the monopoly of land and the monopoly of credit. Were it not for these, it would disappear . . . .

    The usurer is the Somebody, and the State is his protector.1

[BillyC]

Usery is Americas favorite poison, get it now pay later.

[FrankChodorov]

Usery is Americas favorite poison, get it now pay later.

"I sincerely believe... that banking establishments are more dangerous than standing armies.
- Thomas Jefferson

got that right...

I hope you do not fall for the fallacy that gold needs to serve as both a basis of issue and a standard of value...

The basis of issue of money is any property that the money represents and which imparts value to the money. That is why "inflation" occurs when money is issued without adequate or any security.

Since ancient times a superstition prevailed that only gold and/or silver are a proper basis for issuing money. Since these metals are scarce, their owners could charge interest for the mere use of them to effect exchanges. Proudhon, Warren and Greene showed that all labor products can be used as a basis of issue, i.e., can be monetized at the mere labor cost of bookkeeping (less than 1/2%), and as a result no one need borrow capital (gold or silver) or pay interest, which is any price in excess of the labor cost of doing business, and which is only a result of monopoly.

Tucker contemplated that the proper function of a "credit-shop" - or bank - is to establish credit on a large scale, probably by agreement with other banks, and then to underwrite the credit of less widely known local property owners whose property is the basis of their credit. Thus ruinous interest rates can be eliminated by mutual credit.

Originally, capital (gold or silver) was actually loaned, and interest was usury paid for the mere use of it. During the time when Tucker published Liberty, it was widely held that a bank could not operate without capital. This superstition seemed to justify the legal requirement that the founders of a bank put up reserves of capital to use as a basis of issuing money. This effectively restricted banking to the wealthy. Tucker, following Proudhon and Greene, argued that the property of the customers could be used as a basis of issue, and therefore no lending or borrowing need occur, and money could be had without interest.

Today the bankers are more clever; they have taken the position of the mutualists that they need not risk their own capital, yet they require their customers to mortgage their property on the pretext that it is "collateral" security for the miscalled "loan". However, since nothing is loaned, and since the pseudo-notes they issue are not redeemable in anything, the procedure is but a device to get unearned title to other people's property. Thus a basic principle of mutual money has been co-opted by the bankers, and corrupted by them into a triple steal: that is, they get contingent ownership of customer property; they issue money without redemption; and they charge interest to their customers for the privilege of being cheated.