INTEREST ON MONEY.
The House resolved itself into Committee of the Whole, (Mr. Edwards in the Chair,) and took up the several bills concerning interest on money - and first the committee considered Mr. Stsmfield's bill (65) to amend sec. 4, of the interest law, so as to allow of the recovery of principal and interest in cases where more than legal interest has been contracted - the committee having heretofore adopted Mr. Colgrove and Mr. Usrey's amendment, substituting a conventional rate of interest as high as ten per cent, on money loaned - restricting banks to loans payable at their banking-houses, and from taking exchange on notes and bills payable at any other place, [as printed in page 84 of these reports.]
Mr. STANFIELD stated the provision of the original bill, and the reasoning for it, and the support which its principle had already received in our own legislation allowing the usurious money-lender to recover his principal. He regarded the amendment of Mr. Colgrove as out of order - not being germane or pertinent to the preposition.
The CHAIRMAN. The amendment was adopted by the committee the other day. And since Mr. Martin's bill, (123) with an amendment, and also a petition on this subject, from sundry citizens of Vermillion county, and another bill have been referred to this committee, the parliamentary law prescribes that questions can only be put upon motion. The question to recommend the bill as amended to the House, pending when the committee rose last Wednesday, will be put, unless another motion be made, which can have precedence of that.
Mr. Speaker GORDON moved to report a motion to the House that the bill and amendment be indefinitely postponed. The burden of proof was upon the friends of this proposition raising the rate of interest. He had before endeavored to refute the arguments submitted in favor of it. Since the former discussion, he had learned that the Ohio Legislature-(a State where they had made trial of the higher rate)have returned to the old rate of 6 per cent. He went on, at some length, with the argument against any increase of the present legal rate.
Mr. STANFIELD stated the order, and acquiesced in the motion of Mr. Gordon.
page: 122[View Page 122]Mr. COLGROVE reiterated his former argument for his amendment - alleging again, that the banks were the Shylocks in our State, and replying to Mr. Gordon. It was not proposed to establish the rate of 10 per cent., but to establish a principle of law bv which parties shall not contract for more than 10 per cent, he supposed when his amendment was adopted in Committee of the Whole the other day, that the vote thereon was a test of the feeling of the House on the subject.
Mr. COMSTOCK. In his opinion, whoever pays more than 6 per cent., "pays too dear for his whistle." He would adhere to those rules of law which were calculated to enrich a people. He would not, by his vote, give countenance to any principle that would oppress the arm of labor.
Mr. DOBBINS defined his position to the question. The principle of the bill involved a contest between capital and labor A mechanic himself, he would give no vote for a law to oppress the mechanics of the State- He showed the practical workings of such a law as the bill proposed, and honed the committee would recommend its indefinite postponement.
Mr. MELLETT, though not in favor of this bill, he and his constituents were in favor of some change of the law on this subject. Some legal rate should be fixed, to determine the value of the use of money in the absence of any contract, but beyond this, he considered, there should be no restriction upon contract for interest. He replied to the foregoing arguments against the bill. The opposition to the bill proceeded upon the principle that men did not know how to take care of their own interests in a contract. If gentlemen would have laws and contracts enforced, there was a necessity that there should be discretion allowed to the contracting parties. No law should restrict the discretion of parties competent to contract, &c.
Mr. STILES also spoke at length on the whole subject, submitting conclusions his opposition to the passage of the bill, and in reply to sundry arguments in support of it. The plea of violation was no argument against the law. There was no law in all the code hut could be made liable to such an objection. He was willing to vote for a law giving ten per cent, on contract, with the privilege of avoiding the four per cent excess, by paying the legal rate and accruing costs.
Mr. PARRETT looked at some of the probable results of the passage of the bill. It would induce the most stringent collections of money in order to put it out at interest. It would draw money from the manufacturer and the laborer, and put it into the vaults of the capitalist. It was the duty of the representative here to protect the interests of the whole peoplenot the interests of the few, &c.
Mr. GRIFFIN. The operation of the bill would not reach the case of the debtor, about which gentlemen had been warmly talking. It was only to affect money loaned upon contract Readmitted that the onus of the justice and the emergency of the bill rested upon its friends, and proceeded to distinguish between things right in - themselves, and things made right by law a thence to show that this people - the borrowing classes of the people - were desirous of a higher rate of interest, and the Legislature had only to authorize it and it became right. Such, alone, would enable individuals to come into equal competition with bankers in the business of hiring money; it would "remove the deposits" from the banks and invest the money elsewhere. The ten per cent, law in Ohio had accomplished its objecthad drawn capital with her borders, and now she was prepared to repeal it, &c.
Mr Speaker GORDON regarded the amendment of Mr. Colgrove as unconstitutional, because it was an infraction of that clause which prohibits the Legislature from granting to any citizen, or class of citizens, any privilege or immunity which is not extended equally to all. Here was the privilege of four per cent, advantage to the money-leader. What an immense advantage this privilege would give to the banks. It would increase the annual amount of interest paid by the people of Indiana to three million of dollars. And such a thing was demanded by the people! say the gentleman from Randolph and the gentleman from Lake. There were not 300 names on all the petitions of the session asking for such a law, &c. He looked at the past experience of the State under legislation in this direction, and replied to the foregoing arguments. This same scheme of a high rate of interest was now cramping and crushing out the energies of the people of the State of Wisconsin, &c.
Mr. NEBEKER of Warren, made an effectual motion, that the committee rise, and ask leave to sit again to-morrow.
Mr. Speaker Gordon's motion to recommend the indefinite postponement of Mr. Stanfield's bill, as amended, was now agreed to.
On motion by Mr. AUSTIN, it was agreed that the committee recommend that Mr. Martin's bill (123) and amendments thereto, be laid on the table.
On motion by Mr. STANFIELD, the committee rose, and the Chairman reported their action, as above.
The House then (at 4:45 o'clock) adjourned.
