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B23805
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Reasons for the abatement of interest to four in the hundred and the objections against it fairly stated and briefly and fully answered / by E.H.
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E. H.
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1692
(1692)
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Wing H21
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18,351
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71
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be anticipated upon a borrowing Clause shall sooner be brought in and that will be of great use to the Nation so that what is here urged against lessening Use is when well weighed a very strong reason for it but what if Money should flow in will it not find a way out Have we any ground to fear it will be lockt up there I am sure there is no such danger in time of Peace and much less during a chargeable War Object 7. That Widows and Orphans will suffer much by an abatement of Interest Those who have Sixty Pound a year for a 1000 l. will then have but Forty Answ I answer thus This will not be a general prejudice because they are few in number in respect of the whole Nation for they are scarcely one to twenty of the whole People and of those not one in Forty will suffer by an abatement of Interest for these reasons many of them have Land or Annuities and such persons may gain more by the rise of Land than they will lose by the fall of Use-money Many Executors allow Orphans no Interest and yet justifie themselves by Law to such Orphans it will be no damage to lessen the Legal Rate of Interest Their Portions will be of the same esteem and of the same value to buy every thing except Lands and they were never given them with that intent for then their Parents might as well have given them Lands So that it is only the income of their Portions that will be lessened and that but for a short time till the young men set up their Trades or till the Maidens or Widows marry But how severe soever the lowering of Interest from Six to Four in the Hundred may be to Widows Orphans or younger Brothers yet they will have as much Rent for their Money as the Gentry and their Elder Brothers have for their Land for the Land of England doth not yield Four in the Hundred After Interest is reduced to Four in the hunnred many will leave their Children Annuities or Estates running in Trade as they do in Holland and Italy whereby the abatement of Interest will become profitable not prejudicial to them and advantageous to the whole Nation by enlarging Trade Object 8. That Gentlemen must give more with their Daughters for Portions by which means a great part of the Inheritance of such Gentlemen's Estates will be lessen'd and more incumber'd Answ This Objection is founded upon a Supposition that the value of the Principal Money is sunk and therefore they must give greater Portions but that is a mistake for 1000 l. will be as much valued by a Trades-man as it is now it will buy as much Goods of some sort more after Usury is abated as it will now Foreign Stocks or Wares may be Sold 2 l. per Cent. cheaper than now they can be afforded for and the greatest part of the Ladies expence is in Foreign Wares so that they may then maintain themselves almost as well with forty Pounds a year as they can now with threescore But if larger Portions should be requisite the Gentleman will be better able to raise them for his Rents will be better paid and his Land will sell for a third part more so that his Estate will be less incumber'd then before Object 9. Others object That an Abatement of Interest by a Law is not practicable nor would it be conducive to the end aim'd at tho they confess a low Interest doth most encourage Trade and advance Land Answ Some Men fancy That such a Law would be only advantageous to Scriveners who will have more for Procuration and Continuation If this should happen tho I see no reason for it the Borrower might afford to give more to the Scrivener when he pays less to the Usurer Interest hath been abated twice in England by Act of Parliament within the space of fifty years with very good success and great advantage to the Kingdom and what should hinder its effect now more than formerly If a Law will not do it why do the Usurers always oppose the passing of an Act to that purpose The true Reason seems to be because they are wise enough to know that a Law will certainly do it as it hath done already tho they would perswade others to the contrary Octject 10. Many assert That low Interest is not the Cause but the effect of Riches or otherwise say they Why are not all Countries rich they having it in their Power to make themselves so by a low-stated Interest by Law Answ That low Interest is the cause of Riches I appeal to the Judgment of the Parliament in the 21 Jac. and of that in the 12 Car. 2. who ascribe the decay of Trade the fall of Rents the discouragement of all Improvements and good Husbandry to the height of Interest and those wise Considerations did induce them to pass two Acts as may be seen by the preamble to the Acts reducing Usury from Ten to Eight and from Eight to Six in the Hundred The Authority of so many wise and worthy Patriots and the visible usefulness of those Acts confirm'd by Seventy years Experience is I doubt not of so great weight that no Man without immodesty can deny that low Interest is the cause of Riches Vide p. 31. to p. 39. Object 11. Lastly some alledge That all the Reasons urged for reducing Interest to Four in the Hundred will hold as strongly against all Vsury Answ To this I answer No for many Improvements are made with borrow'd Money and several considerable Trades are carri'd on with Loans which would fall or decay unless Money could be had readily and freely 'T is true if Money'd men would lend their Money freely and gratis upon all occasions then doubtless Trade would flourish most and Land be advanced to its highest Value but since the Usurer is not so publick-spirited it is necessary that a moderate Interest should be allowed to invite him to part with his Money frankly but why so great as to discourage Trade and wholly to depress Land nay to exceed the Rent of it I see no occasion My Lord Bacon in his time in his Essay upon Usury thought it expedient that Use should be brought to 5 l. in the Hundred and highly reasonable that the Rent of Land should always exceed the Interest of Money and I am sure at Four in the Hundred it will not do that I have now gone through all the Objections of moment that ever I could find in Print or meet with in Conversation I have answered every one of them distinctly with as much brevity and perspicuity as possibly I could If through inadvertency I have omitted any I ask the Reader 's pardon how many more Objections soever may occur this short Answer will serve for all We have often and continually felt the good Effects of an Abatement of Interest and therefore we may reasonably expect the like advantage the Objections were the same then as now and can have no greater force nor be of worser consequence I wish what is said may give satisfaction if it doth not I hope this Subject which is of so general concernment and publick use to the whole Nation will be better handled by a more acceptable and successful Pen. The CONCLVSION THE raising the value of Land at this time seems most necessary the Nation being engaged in such a chargeable War For the Land is the Fund that ever hath maintain'd and must still support and preserve the Government Have not all our late Taxes been raised upon Land Excise Customs upon Home-Commodities which Duty ariseth from the product of Land or Impositions upon foreign Goods the last of which doth tho not so immediately fall upon Land For the Gentry and consumer of foreign Wares must pay at least so much dearer as the Duty amounts to If the Charge of our Government and Defence should increase as they have lately and I am afraid must still the Power of France being so formidable and should Their Majesties Customs decline as they must unless we have a free and uninterrupted Trade at Sea then I would gladly be informed from any Projector how this happy Settlement can be kept up or the French kept out without a General Excise or an Extraordinary great and lasting Land-Tax Money must be granted in proportion to future Exigencies how great soever they may be There is no true Englishman but will chearfully give his Money when Life Fortune and Family are at Stake I need not remind any Gentleman how Rents fall and Tenants break tho very honest and industrious But one thing I desire all Gentlemen especially such who have no Places to consider seriously in what manner after what poor fashion they must live if but half of their Estates be thrown into their own hands I doubt they will find it very difficult to stock that half and when Taxes and all other Charges are paid and the usual deductions made not to reckon Casualties I fear they will see very little Money Nothing but an abatement of Interest can effectually reach the Usurer who must otherwise grow rich in time of War whilst others labour under heavy pressures In a word no Law can be of greater advantage to the Nation than an Act to reduce Interest to 4 l. per Cent. it will produce the most general good with the least private disadvantage it will give great satisfaction to the whole Kingdom it will make an abundant recompensation for the Great Taxes and heavy Impositions which the necessities of Publick Affairs have required the Parliament to lay upon the People and it will enable the Landed-men to bear exceeding Taxes with great ease and chearfulness No Consideration whatsoever hath induced me to expose these lines to publick view and censure but the deep sense I have of the Free-holder's and Farmer 's Poverty the visible decay of Trade the prospect of the pitiful condition of the Ancient Nobility and Gentry who have not been brought up to Husbandry if once their whole Estates should be Untenanted nothing else hath brought this Treatise forth therefore I hope if I be mistaken in the Remedy propounded the Candid and Ingenuous Reader will easily forgive me and acquaint the World with a more speedy and effectual way to raise the value of Land and increase Trade FINIS
may multiply People and the multiplication of People may cause a greater Fertility in that Country so the Abatement of Interest causeth an encrease of Wealth and the encrease of Wealth may cause a further Abatement of Interest Since our first Abatement Discourse of Trade of Interest the Riches and Splendour of this Kingdom is very much increas'd as appears from the new Buildings fine Furniture and number of Coaches from our Shipping and Navigation from the improvement of our Customs which doth not proceed so much from the advancement of the Rates of Goods as from the encrease of the bulk of Trade for tho some Foreign Commodities and Manufactures are advanc'd yet others of our Native Commodities and Manufactures are considerably abated in the Book of Rates England hath been enrich'd constantly and proportionably to and after our several Abatements of Interest by Law from an Unlimited Rate to Ten from Ten to Eight and from Eight to Six in the Hundred And I think it may reasonably be hoped that a further Abatement will produce more Riches as well here as it hath done in Holland As it hath been in England so my Author saith it is in all Europe and other parts of the World insomuch that to know whether any Country be Rich or Poor or in what proportion it is so The resolution of this Question viz. What Interest do they pay for Money will tell you for all Countries are at this day Richer or Poorer in an exact proportion to what they pay and have usually paid for the Interest of Money That an Abatement of Interest would encrease Trade which is the cause of Riches and would raise the value of Land and keep up Rents was the opinion of the Parliament in the 21 Jac. 1. and of another in the 12 Car. 2. as appears in the Preamble to those Acts which I desire the Reader once more to look over again That they were not mistaken in their Sentiments is evident from Seventy years Observation beyond all Contradiction insomuch that it must be granted by all Englishmen for it can no longer be made a Question That to abate Interest will advance Land and encrease Trade and consequently is the cause of Riches It is confest on all hands that in Holland Interest is lower than in England but some are pleas'd to say That is not the effect of Laws but proceeds only from the Plenty of Money for in Holland there is no Law restraining Usury To which I answer out of my Anonymous Author in his Discourse of Trade That it may be true that in Holland there hath not lately been any Law to limit Usury to the present Rate it is now at viz. 3 or 4 per Cent. yet most certain it is that many years since there were Laws in Holland that reduc'd Interest to 8 6 and afterwards to 5 per Cent. An. 1640. and in the year 1655. to 4. per Cent. as he affirms pag. 31. and no doubt but they would by Law lessen Usury still were it necessary at this time It having always been the policy of that State to keep down the Interest of their Money 3 or 4 per Cent. under the Rate of what is usually paid in their Neighbouring Countries we never yet abated our Interest but they soon after abated theirs Interest hath been at 6 per Cent. in Holland but after it was reduc'd to Eight in England it was reduc'd to Four in Holland and now being at Six here 't is there at Three so that they have always kept the same advantage in Trade from our over-ballance by Usury well understanding the Profit they have from thence It may not be impertinent to recite here so much of the French King's Edict as concerns this matter for perhaps all may not elsewhere come to the sight of it He found that Ten or Eight in the Hundred did ruine many good Families hindered the Traffick and Commerce of Merchandize and made Tillage cheap and Handicrafts to be neglected many desiring through the easiness of a deceitful Gain to live idlely rather than give themselves to Arts or to Till or Husband their Lands For these Reasons he did forbid all Usury at an higher Rate than 6 l. 5 sh. in the Hundred This Edict was ratify'd in the Court of Parliament I have transcrib'd this out of a discourse of Trade pag. 51. Should I pursue all the advantages to Trade which may reasonably be hoped for from an Abatement of Interest or should I enumerate all the benefits which will redound to the Kingdom by the encouragement and encrease of Trade this Piece would swell into a large Volume I need not tell you of what great use the lowering of Interest would be to the Government That the King might with much less Charge build Ships and set out his Fleet that all Ammunition and other Necessaries for the Army would be much cheaper That upon all occasions he would be more readily suppli'd with Money These Considerations alone are of no small Concernment to the Nation for the more easily the Government can be maintain'd the less Taxes will be wantting It would be unnecessary to add any more upon this Head which relates to Trade I make no doubt but the Reasons alledg'd will convince the Merchant and Trades-man That a further Abatement of Interest will be no prejudice to them but will highly advance their Calling I proceed now to the next thing propounded to the Consideration of the Reader wherein I shall endeavour to satisfie the Landed-man That to lessen Usury will be of very great advantage to him by raising the Value of Land in Purchase and by enabling his Tenants to give more for his Farm or at least to pay his Rents fooner CHAP. II. That Abatement of Interest will raise the Value of Land THE inseparable Affinity betwixt Trade and Land is so obvious to every Man's understanding that I think it will not be deni'd but when Trade flourisheth Land always bears a good price and the Landlord's Rents are well paid When Trade decays Rents are never well paid and the price of Land falls too on the other hand when Rents fall and Farmers break then Shopkeepers fail and Merchants give over The Interest of one is so interwoven with the others that it cannot be ill with Trade but Land will fall nor ill with Land but Trade will feel it This Observation is by experience found so true that no Trader or Landed-man can make the least doubt of it That Land in England hath risen in value as Interest hath Discourse of Trade been abated is matter of fact and every Owner of Land can best judge of this look but into your Ancestors Deeds of Purchase made Seventy years ago and you will find that Land was then fold for 10 or 12 years Purchase but an enquiry into the gross Sum of Money paid will be more exact and less fallible than to make an estimate by the years Purchase for many Farms