MORTGAGOR FAMILIES.
It must be borne in mind that in this chapter we have to consider only
those families of the nation which were in possession of real or
artificial[86] property before and after the year 1890. And we have
especially to consider those of them whose properties were mortgaged;
and those whose properties were to be lost in consequence of the
mortgages they were encumbered with. While the propertyless or the
tenant families, that were treated in the preceding chapter, will now be
kept in the background of the statistics with which we have to deal.
When, however, we are through with the statistics, we may make
references to and may even make special statements about the tenant
families treated before; while the prominent position will now be given
to the mortgagor families, showing how they fall from the class of
property owners, become debtors to the owners of greater wealth, lose
their properties and increase the numbers of the propertyless.
It is important to note here that the loss of the rights to property
always precedes the actual loss of property itself; and that the fall of
the propertied into the sphere of dividogenesure, also precedes the
actual economic slavery of those that become propertyless.
The very day in which a propertied person mortgages his property he
loses his rights for the wealth he has owned, because his property goes
from him as a security [SN: LOSS OF RIGHTS PRECEDES LOSS OF PROPERTY.]
for the loan he makes. And while losing the rights, he takes upon
himself the obligation to divide the results of his labor between the
lender and himself, and thus falls under the influence of
dividogenesure. For, henceforth, he spends his active energy in favor of
the creditor and himself, and is obliged to regard the interests of the
creditor as of more importance than his own. The rate of interest to the
creditor must be accurately paid so much per cent per annum for the
loan. Hence, the mortgagor at once appears in the position of a tenant
of farm or of any other property. And it depends on the rate of the
percentage he agreed to pay out of the results of his labor whether he
is better off or worse even than a mere tenant. It also depends on the
fact whether his mortgaged property is a large one or small, and whether
he has mortgaged one part or the whole of his resources of wealth. In
any way, a mortgagor, according to the degree of his indebtedness, is an
economic slave of the owners of greater wealth. And he must have a
supernatural ability and must use an extraordinary effort in order to
pay his debt or to redeem his property. Otherwise his property must pass
into the absolute ownership of the wealthy families that millions of
other individuals already labor for under the modern type of slavery.
But let us now see the statistical facts and then we may better judge of
what mortgages signify and what they mean to the nation. We shall take
the other class treated in the same bulletin out of which we extracted
the 6,624,259 tenant families for the preceding chapter.[87]
STATISTICS.[88]
“Extra Bulletin No. 98 of the United States Census, 1890,” (of the
mortgagor families) “says:”
That out of the whole 4,767,179[89] farming families in the United
States only “65.92 per cent,” or 3,142,414 families “own the farms [SN:
FARM FAMILIES IN DEBT.] cultivated by them.” And “that 28.22 per cent,”
or 886,839 families out of the 3,142,414 owning ones, “own subject to
encumbrance,” i. e., they are in debt; “and 71.78 per cent,” or
2,255,575 families, “own free of encumbrance.” So that among every 100
farm owning families 72[90] own without encumbrance and 28 own with
encumbrance.
And the same Bulletin further says: That “on the owned farms there are
liens[91] amounting to $1,085,995,960, which is 35.55 per cent of the
value of the encumbered [SN: DEBT AT 7.07 PER CENT.] farms, and this
debt bears interest at the average rate of 7.07 per cent,” which is more
than 7 dollars for every $100 borrowed. It is at this rate per annum
that the farmer’s labor energy is drained by the wealthy creditors or by
the bankers. “Each owned and encumbered farm on the average is worth
$3,444.” This average, of course, includes the families far above $3,444
worth and far below it—“and” each, on the average, “is subject to a debt
of $1,224.”
Hence it follows that the principle of dividogenesure, in these cases,
has a yearly demand that every debtor should, on the average, pay about
$86.53 worth of the results [SN: INTEREST.] of his labor energy to his
creditor. And it is a question whether even a highly effective capital
worth $1,224 is really able to increase the yearly results of the
debtor’s labor to the extent of $86.53—I mean an increase in his product
absolutely due to the aid of the borrowed capital on which he is to pay
this sum as the annual interest charge. It is rather probable that the
majority of the mortgagors pay more than half of this annual percentage
at the expense of their personal energy, even under the condition of the
most effective use of the borrowed means. For the rate of 7.07 per cent
is unconscientiously exorbitant and is generally abnormal.
As to the families owning homes, the corresponding facts are “that
27.70[92] per cent,” or 809,831 families, out of the 2,923,577
home-owning families, “own their [SN: HOME FAMILIES IN DEBT.] homes with
encumbrance, and 72.30 per cent,” or 2,113,746, “own them without
encumbrance.” So that in every 100 home-owning families 28 are in debt
and 72 are free of debt. “The debt on owned homes aggregates
$1,046,953,603, or 39.77 per [SN: DEBT AT 6.23 PER CENT.] cent of the
value of the encumbered homes, and bears interest at the average rate of
6.23 per cent. An average debt of $1,293 encumbers each home, which has
an average value of $3,250.” This average again includes the family
homes worth far above and far below the indicated value. While the homes
below this value may have greater encumbrances than the others; and it
is certainly the poorer families that lose their properties first, if
they attempt to get rich by means of the loans they can obtain at the
rate of exorbitant per cents.
If then the average debt of these 809,831 families is $1,293 and the
rate per cent for it is 6.23 per cent per annum, every one of them [SN:
AVERAGE OF INTEREST.] is, therefore, a subject to the principle of
dividogenesure at the rate of $80.55 a year. It must, however, he
understood that the averages indicate only the general truth, and always
conceal the particular miseries and distress of many millions of the
people. And I understand that many of these debtors have been in the
gainful pursuits spoken of by Mayo-Smith, and hence the dividogenesure
presses upon them from two or even more sides. But it is only the next
census that will show us the situation these debtors are in.
Let us now speak about the cities and towns with one side of which we
have become acquainted in the preceding chapter.
CITIES AND TOWNS.
“There are 420 cities and towns that have a population of 8,000 to
100,000, and in these “cities [SN: OWNERS OF THE CITIES FOUND AMONG
414,544 FAMILIES.] and towns 64.04 per cent,” i. e., 1,120,433 “of the
home families hire and 35.96 per cent,” i. e., 629,146 families “own
their homes, and of the home-owning families 34.11 per cent,” i. e.,
214,602 “own with encumbrance and 65.89 per cent,” i. e., 414,544 “own
free of encumbrance. The liens on the owned homes are 39.55 per cent of
the value of those subject to lien. Several averages show that the rate
of interest is 6.29 per cent; value of each owned and encumbered home is
$3,447; lien on the same is $1,363.” (See Appendix I.)
So that these debtors of the 420 towns and cities are also subject to
the principle of dividogenesure at the rate of $85.73 each per every
year, as long as the mortgages remain in force and are not foreclosed.
“The cities that have a population of 100,000 and over” (up to millions)
“number 28, and in these cities 77.17 per cent,” i. e., [SN: OWNERS OF
THE LARGE CITIES FOUND AMONG 276,744 FAMILIES.] 1,503,911 “of the home
families hire and 22.83 per cent,” i. e., 444,923 “own their homes;
37.80 per cent,” i. e., 168,179 of the latter families have encumbrance
and 62.20 per cent,” i. e., 276,744 families are free of encumbrance.
Averages for owned and encumbered homes are: Encumbrance, $2,337; value,
$5,555; rate of interest, 5.75 per cent. Homes are encumbered for 42.07
per cent of their value.” This is the largest average encumbrance among
all encumbered homes and farms.
So that every debtor in these 28 large cities (and there are 9 of them
in every 100) is a subject to the principle of dividogenesure at the
rate of $134.37 each in every year as long as the mortgage is in force
and is not foreclosed. It is after the foreclosure that the debtor
cannot even redeem his mortgaged property; he has then to remain
propertyless. Let us now sum up the preceding conclusions in a tabular
way, as follows:
United States Farms and Homes.
----------------------------------+----------+-----------
The Farm-Families. | Per Cent.| Number of
----------------------------------+----------+-----------
The total of families occupying | |
farms | | 4,767,179
| |
(1) out of them: The families | |
hiring farms | 34.08 | 1,624,765
+----------+-----------
(2) and the families owning farms | 65.92 | 3,142,414
| |
Out of the last 65.92 per cent. | |
of them are those owning farms | |
with encumbrance | 28.22 | =886,839=
| |
And those owning them free of | |
encumbrance | 71.78 |2,255,575
----------------------------------+----------+-----------
The Home-Families. | |
----------------------------------+----------+-----------
The total of families occupying | |
homes | | 7,922,973
| |
(1) out of them: The families | |
hiring homes | 63.10 | 4,999,396
+----------+-----------
(2) and the families owning homes | 36.90 | 2,923,577
| |
Out of the last 36.90 per cent. | |
of them are those owning homes | |
with encumbrance | 27.70[93]| =809,831=
| |
And those owning them free of | |
encumbrance | 72.30 | 2,113,746
----------------------------------+----------+-----------
Total of farm and home families |
with encumbrance | =1,696,670=
---------------------------------------------+-----------
This double table shows clearly enough that there were 8,320,831 tenant
and mortgagor families that have been subject to the principle of
dividogenesure. And [SN: SUBJECT TO DIVIDOGENESURE.] that these families
had 41,061,563 individual members, including children that have now
grown up to the same fate of the drain of labor energy, under which
their unfortunate parents have been. For all these individuals, of
course, cannot exist without working in favor of the few money lenders
and propertied men, because the tenants have no resources to apply their
energy to, and the mortgagors cannot profit themselves by the loans of
exorbitantly high per cent of interest. Hence, they are all drained and
all are economic slaves of the wealthy few.
Besides, the necessary life-expenses of every one, subject to a strong
dividogenesure,[94] are absolutely greater than the same expenses of any
one in the wealthy group. While the incomes of the rich that the
millions of other individuals and the forces of capital work out, cannot
even be compared with the semi-incomes of the poor that are obliged in
any way to work for the wealthy, when these are disposed to give them a
chance to work.
Further, is it not an abnormal reality that the 420 towns and cities in
the United States should belong [SN: CITIES OWNED BY LESS THAN 24 PER
CENT OF THEIR PEOPLE.] to less than 24 per cent of the entire population
in them? And is it not strange that the remaining 76 per cent of the
inhabitants in these cities and towns should live and labor with the
purpose of feeding, fattening and enriching these 24 per cents of the
people who are really the owners of these towns and cities? And is it
not abnormal in the extreme to have 28 cities, populated by hundreds of
thousands and by millions of individuals; and that these [SN: CITIES
OWNED BY LESS THAN 14 PER CENT OF THEIR PEOPLE.] cities, including all
kinds of buildings, machines, houses, etc., etc., should actually be
possessed by less than 14 per cent of their population? And that, in
addition to this extreme abnormity, the remaining 86 per cent of their
people should be obliged to divide all results of active and creative
energy with these few owners of the great cities?
But what is inconceivably strange is that this extremely abnormal
situation should be produced in a nation governed by the people’s
representatives chosen by their good will and purpose; and that this
will and purpose should bring about the results of so great injustice
and wickedness against this people, is only possible on the basis of
ignorance, neglect of duty and selfishness.
Let us now have an idea of the progress of development of the principle
of dividogenesure in the United States, and of the rapidity with which
the people fall under its oppressive influence, thus gradually becoming
propertyless or the absolutely helpless economic slaves of those that
capture them within the extensive nets of that principle.
* * * * *
“Extra Census Bulletin No. 71 gives the statistics on mortgages by
amounts, length of mortgage, rate of interest for the United States from
1880 to 1889.”
It says: “That during that time 9,517,747 real estate mortgages, stating
amount of debt incurred, were made in the United States, representing
[SN: INCREASE OF MORTGAGES.] an incurred indebtedness of
$12,094,877,793. The number of mortgages made during one year[95]
increased from 643,143 in 1880 to 1,226,323 in 1889, or 90.88 per cent,
and the yearly incurred indebtedness increased from $710,888,504 in 1880
to $1,752,568,274 in 1889, or 146.53 per cent.”
“With regard to mortgages on acre-tracts, the number made during 10
years was 4,747,078, representing an incurred indebtedness [SN:
ACRE-TRACTS.] of $4,896,771,112.” The increase in making them was as
follows: “The number of these mortgages made in” the year “1880 was
370,984; in 1889, 525,094.” So that during the years between these “an
increase of 41.54 per cent” was made; “while the incurred indebtedness
increased from $342,566,477 in 1880 to $585,729,719 in 1889, an increase
of 70.98 per cent.
“The increase was relatively larger in the case of mortgages on lots.
They numbered 4,770,669 during the 10 years, and the indebtedness [SN:
ON LOTS.] incurred under them amounted to $7,198,106,681. From 1880 to
1889 the annual number made increased from 272,159 to 701,229, an
increase of 157.65 per cent. During the same time the amount of annual
indebtedness incurred increased from $368,322,027” in the year 1880, “to
$1,166,838,555” in the year 1889, “an increase of 216.80 per cent.”[96]
As you see, the yearly increase in the numbers of making new mortgages
was astonishingly great on all sides. This progress of falling under the
influence of dividogenesure, falling into debt, indicates that the
people could not avoid becoming slaves to the percentages for loans.
This progress indicates that they were compelled by the generally
abnormal conditions of existence to take the risk of losing their
properties. And all cities thus grow as “New York City,” where “but 6⅓
per cent of the families owned their homes”[97] in 1890.
“AMOUNTS:”
“During the decade 622,855,091 acres were covered by 4,758,268 mortgages
stating and not stating the amount of indebtedness incurred under them.
The number of acres covered by mortgage in 1880 was 42,743,013; in 1889,
70,678,257; an increase of 65.36 per cent. In the case of lots covered
by mortgage the increase was 198.25 per cent. The number” thus “covered
by mortgages stating and not stating amount of indebtedness in the
former year being 429,955; in the latter year 1,282,334.
“At the end of the decade, January 1, 1890, the [SN: ON ACRES AND LOTS.]
real estate mortgage indebtedness amounted to $6,010,670,985,” on the
whole, “represented by 4,777,698 mortgages,”[98] which were divided into
the mortgages on the acres and the mortgages on the lots.
It was also computed that the average length of a mortgage in the United
States is longer than four and a half years, or exactly [SN: LIFE OF
MORTGAGE.] “4.660 years.” The Bulletin calls it a “life of a mortgage,”
which may last “as much longer without being paid off;” that is, a
mortgage may last as long as the creditor gets his rate of interest, or
as long as his increasing interest is secure in the whole value of the
mortgaged property. Otherwise a mortgage is foreclosed.
But what is specially important for us is whether the mortgagors are
able to extinguish their debt with the same rapidity with which it was
incurred by them? If they are able to pay off their debts at the proper
times, then mortgaging of property would at least appear uninjurious to
their well being, though it could not be regarded as profitable to them.
The same “Bulletin No. 71,” however, states that, “since mortgages in
force were made, 12.68 per [SN: ORIGINAL DEBT PAID: 12.68 PER CENT.]
cent of the original amount of indebtedness incurred under them has been
extinguished by partial payments.” Now, it was time to extinguish all
the original amount on mortgages in force. Yet 87.32 per cent of the
original indebtedness could not be paid off by the debtors. And this is
a sign of the [SN: ORIGINAL LOSS OF PROPERTY: 87.32 PER CENT.] most
forcible argument, showing that the greatest majority of the mortgagors
have been on the way to ruin, and on the way of losing their properties.
It is thus the millions of tenants appeared in 1890.
THE PER CAPITA DEBT.
Instead of being paid off at proper times, the mortgage debt was
accumulating so far that if it were divided among the entire population
in 1890, every man, woman and child would have been in [SN: PROPORTIONS
ON STATES.] debt of $96. Just as the Bulletin says that “the mortgage
debt per capita in the United States is $96; the three largest state
averages (omitting the District of Columbia) are $268 in New York, $206
in Colorado, and $200 in California. The smaller ones are found in the
south and the Rocky Mountain region.”[99] Such is the per capita debt in
these three States.
“In 41 States 28.86 per cent of the taxed acres are covered by mortgages
in force. The largest proportion of mortgaged acres is in Kansas, where
60.32 per cent of the total number of taxed acres are mortgaged.
Nebraska stands next, with 54.73 per cent; South Dakota third, with
51.76 per cent.[99]
“In the five States, Illinois, Kansas, Missouri, Nebraska, and South
Carolina, 23.99 per cent of the taxed lots are covered by mortgages in
force,”[99] and so on in the other States. But the most important fact
is the annual interest the people have to pay to the wealthy few for
their loans.
AVERAGE RATE PER CENT ON THE
DEBT.
“The average rate for all mortgages in the United States is 6.60 per
cent. For mortgages on acres,” the average is “7.36 per cent; for
mortgage [SN: U. S. RATE PER CENT.] on lots, 6.16 per cent. These rates
make the annual interest charge on the existing real estate mortgage in
the United States amount to $397,442,792.”[100]
Now we have reached the principle point in these statistics. Imagine
that the families in debt are annually charged with the rate of interest
amounting to $397,442,792 [SN: INTEREST CHARGE.] worth of the results of
their labor, and that the group of creditors get this amount of wealth
yearly without work. And think that, if the average life of a mortgage
is even 4½ years long, these families have to pay $1,788,492,564 worth
of wealth produced by their energy during this time. But we were told
that the average length of a mortgage life continues “as much longer
without being paid off,” that is, it lasts nearly 10 years, and these
families have, therefore, to pay nearly $4,000,000,000 worth of the
wealth produced by them during this time. That is how the debtors are
affected by the principle of dividogenesure which steadily works in all
directions in favor of the wealthy few. This is the economic slavery
that the Nineteenth Century has established for the people of the United
States.
The Bulletin shows that this interest charge is for mortgages on
acre-tracts and on lots, against which the debt of $6,010,670,985 was in
force in 1890, after which it continued to exist and to increase
probably with the same rate as it increased in the previous decade. For,
nothing special has been done to prevent the needy people from
mortgaging their properties. So the mortgages were increasing and the
annual interest charge against lots and acres, too, continued to
increase.
But the Extra Bulletin No. 98 shows that the indebtedness on owned farms
was equal to $1,085,995,960,[101] and the same on owned homes was equal
to $1,046,953,603;[102] [SN: INTEREST CHARGE ON FARMS AND HOMES.] so
that, added together, these two classes of debt amount to
$2,132,949,563, as was stated in this Bulletin. And the average rate of
interest on this debt is shown at the end of the second Bulletin to have
been 6.65 per cent per annum. And “the annual interest charge is
$141,910,106”[103] that has been a burden on 1,696,670 families
represented here in the table, p. 116. Of course, thousands of these
families have now lost their properties forever, as there were liens on
their farms and homes representing the above total of more than
2-billion dollars.
If we now unite the annual interest charge on [SN: COMBINED INTEREST
CHARGE.] the acres and lots mortgage debt, and the annual interest on
farms and homes mortgage debt, we find that these charges amount to
$539,352,898 in every year, which must be paid in any way.
It is certainly not the yearly charge of the memorial past, but it was
stated as existing in the year 1890, and would naturally continue as an
annual interest charge up to the present day. The debtors must use an
extraordinary effort in their toil, in order to get sufficient results
from their applied energy for clearing up this annual interest charge,
and keeping themselves alive.[104] And to speak about an unusual
prosperity of the people under such conditions is as absurd as to say
that the creditors are growing poor from receiving the annual interest
charge consisting of $539,352,898 worth of wealth because they get it
yearly without work.
Yes, every one that speaks about prosperity in the United States knows
what he means. For the statistical facts prove that there is an unusual
prosperity for the very few that the tens of millions of individuals are
bound to work for. But, is it prosperity for these millions of the
propertyless * * * and debtors? No, there is positive enslavement for
them and their children. And it is the innocent children or posterity
that are to be specially pitied.
These tens of millions of individuals become weaker and weaker consumers
of their own products and products of the nation. So that, the few
prosperous families are obliged to look after wider foreign markets to
export to the produce that the millions here have no means, no
purchasing power to acquire. It has long been the case in England, where
millions of the people wear overcoats, for instance, from 5 to 10 years
each, without being able to procure new ones; while the exports of all
goods are ever going on to the different foreign markets. And the
United States are growing similar to Great Britain in almost every
respect. * * *
“The percentages representing encumbrance for various rates of
interest,” says the Extra Bulletin [SN: RATES OF INTEREST ARE HIGHER ON
THE POOR.] No. 71, “show that the larger encumbrances bear the lower
rates of interest, as a general fact.” And the differences in the rates
of interest are from “less than 6 to greater than 12 per cent.” Hence,
the poorer the mortgagors, the greater the weight of oppression they
bear; and the greater oppression they bear, the quicker they lose their
properties, and the greater becomes the number of tenants and of
economic slaves which we have.
The brute-minded creditors think that it is natural to skin the
helpless, because they have no great security for the loans.
What is the significance of mortgages for the nation? And what do other
men acquainted with mortgages think of them?
The significance of mortgages has already been considered by many
thoughtful men, and it is not out of place to quote here the ready views
of some of them.
SIGNIFICANCE.
As there are two economic classes of the people in the United
States,[105] so “there are two views, both of which must be understood.”
The [SN: SEMI-OPTIMISTIC VIEW.] view presented by writers like Mr.
Edward Atkinson is known to some people as worthy of regard,
notwithstanding that these writers knock their heads against a
mountainous wall of facts. “They argue that the mortgage is an
indication of prosperity.” Mr. Atkinson says, in the “Forum” for May,
1895, writing (before the complete mortgage returns given above had been
reported) concerning the census returns for 33 States:
“The first startling fact is that in these 33 States and Territories
nearly 7,000,000 mortgages have been recorded in ten years for a total
sum of nearly $9,500,000,000. The final statement, covering the whole
country, which has not yet been published, discloses the fact that
9,517,747 mortgages were executed in the decade 1880-89 to the amount of
$12,094,877,793.”[106] * * *
And then because “on the first of January, 1890, the amount of these
mortgages remaining unpaid in the whole United States was
$6,019,679,985,[107] Mr. Atkinson says: “It therefore appears that
during the decade one-half of the mortgage debt incurred had already
been paid.” But he forgets to deal with the process of losing property
by the thousands of the debtors who appeared without property in 1890.
And being uncertain about mortgages on acres and lots at the beginning
of the last decade, he infers that “the least estimate of the sum due on
acres and lots at the beginning of this period (1880-90) would
be $1,500,000,000.” And continues that “these original mortgages
executed prior to 1880 must have been wholly liquidated, mostly by
payment.” * * *
As regards this point we have equal or even greater reason to say that
those mortgages have mostly been liquidated by an absolute loss of
property, because at the end of the decade we have had many millions of
propertyless families.
But the chief feature of the situation Mr. Atkinson wishes to vindicate
is that the mortgage growth indicates prosperity and not the system of
tenancy and landlordism as in Great Britain. He says:
“The evidence is conclusive that the increase of hired farms does not
imply the permanent establishment [SN: AFRAID OF PRIMOGENITURE.] of the
relations of landlord and tenant after the English fashion. It does not
imply the concentration of land in fewer hands, but rather the reverse.
It does imply better and more intelligent methods of agriculture, larger
and more varied crops produced from lessening areas of land throughout
the whole great grain-growing section,”[108] and so on.
As to the prosperity, I will say, that a family securing a large amount
of borrowed money or capital at low rates of interest may [SN:
CONDITIONS OF PROSPERITY.] prosper under mortgage by efficiently
applying the capital on its wealth, by efficiently applying the labor
energy of the family members, and, especially, by efficiently applying
hired labor upon its farm or any other kind of property. So that, only
those mortgagor families can have prosperity, which are aided by many
agencies in drawing incomes from their land. While all the poorer
families must be ruined by the mortgages.
As to the argument that we have no establishment of tenancy after the
English fashion of primogeniture, it is enough to refer the reader to
the third chapter of this work, and beg him to understand it well by
reading a second time. For the effects of primogeniture and
dividogenesure are the same, as both principles demand that millions of
individuals should divide the sole results of their applied energy with
the few owners of capital and wealth, or else these millions must starve
without employment. They produce economic slavery in England and in the
United States, where most of the people are now propertyless and
therefore helpless.
Dividogenesure, however, differs from primogeniture by including all
mortgagors into its sphere of oppression.
And it seems to me perfectly naive to assert that “larger and more
varied crops are produced from lessening areas of land throughout [SN:
LOGIC QUEER.] the whole grain-growing section” of the country. For it
really means that the more land the people lose through mortgages, the
better crops they will produce, and hence the best crops must be
produced by them when they lose all the land they formerly owned.
But Mr. Atkinson does not here deal with the fact that more than 64 per
cent of the population in 420 cities and towns, and 77 per cent of it in
the 28 largest cities are also tenants of homes, beside the tenants of
farms he writes about. He does not speak of the fact that the 420 cities
and towns actually belong to less than 24 per cent of their population,
and that the 28 great cities in the United States really belong to less
than 14 per cent of their population; and that the whole population of
the 448 cities and towns are bound, by dividogenesure, to work in one or
other way for the small per cent of their wealthy neighbors, the only
independent population that holds the others in slavery. A dealing with
these tenants would disprove his position. See appendix I.
Mr. G. H. Holmes, writing in the “Annals of the American Academy and
Social Science Quarterly,” gives a more balanced view on the subject. He
says:[109]
“While mortgage debtors must admit that they have done better to obtain
real estate on credit [SN: PINCHING EFFECTS.] than not to obtain as much
of it as they have done, or not to obtain it at all, they are
nevertheless in a situation where they feel the pinching effects of a
reduction or loss of income more than real-estate owners do who are not
debtors. This is owing to the interest that is wanted by the mortgagee.”
While a still better view is given by Rev. Wm. Bliss, editor of the
Encyclopedia of Social Reform.[110] He says:
“The mortgage indicates a hope of progress, but also a slavery to
interest under which many sink.”
It is exactly the point of reality, for many propertied families borrow
money with the hope of getting economically better off, but the [SN:
DECEITFUL HOPES OF VERY MANY.] hopes mostly deceive them, and they find
themselves in the trap of slavery on account of paying too high rate of
interest for the loans they obtain. And it is this slavery to interest
that makes them absolutely propertyless, slaves to dividogenesure.
And it follows that the claim of Mr. Atkinson, that mortgages are
profitable to both the mortgagor and the mortgagee is only true in the
cases of paying the rates of interest not exceeding 3 per cent per
annum, which, however, does not exist in America. And if this rate had
been in existence, then, an effective application of all possible
agencies of production could make the mortgages profitable to the
mortgagors and the mortgagees. While under the present conditions they
are only ruinous to the former and most profitable to the latter.
But let us see the other view on mortgages which must be understood too.
“The view that America is becoming a nation [SN: SEMI-PESSIMISTIC
VIEWS.] of tenants is well known,” says Mr. J. P. Dunn, Jr., writing in
the Political Science Quarterly for March, 1890, after describing the
situation as regards the Western States.[111]
“BURDEN OF DEBT.”
“The mortgage indebtedness of the Western States is a matter worthy the
attention of economists [SN: MOUNTAINOUS AND IMMOVABLE.] and statesmen,
as well as of the people of those States. Whatever may be thought of its
effects, it is a fact—mountainous and immovable. And more, the
probabilities that loom far above the figures here presented make it
very questionable whether the alarmists who have discussed the subject
have in fact materially exaggerated the existing conditions. * * *
“If the people of the Western States may be considered thrifty and
judicious, the people of Michigan may, and by the official records their
condition appears to be as bad as that of their neighbors in Indiana. In
1887 an attempt was made by the bureau of statistics to ascertain the
mortgage debt of the State through personal declarations of the owners
of land. * * * The returns show (report of 1888) that the real estate
mortgages of the State amount to $129,229,553, with an annual interest
payment of $9,451,851 on [SN: AN EXAMPLE OF FORECLOSURES.] a total
realty valuation of $686,614,741. Of this amount $64,392,580 is on
farms, and the annual interest charge is $4,636,265,” which the farms
pay out of their produce. “The number of foreclosures made during the
year was 1,667, and in only 131 cases were redemptions made, leaving a
net loss of 1,536 pieces of property by foreclosure in one year. The
situation apparently justifies the statement of Commissioner Heath that
a very large per cent of the people seem to be in a financial rut, and
are unable to extricate themselves.”
Here you are. Mr. Dunn’s view is not an argument based upon an inference
from a guess, but on immovable facts of evidence which testify that the
State of Michigan [SN: LOSSES IN ADDITION TO LOSSES.] alone assists the
prosperity of the few wealthy families by the yearly contributions of
$9,451,851 worth of wealth produced by the labor energy of its debtors.
And that in addition to this contribution, the same debtors make a net
loss of 1,536 pieces of property by foreclosure in one year. That’s how
this civilized nation regulates the system of money-lending for helping
the people to live. And that’s how the civilized slavery is instituted.
It is by becoming mortgagors that the families pass from a bad degree of
slavery to a worse, until they lose all property, and become totally
helpless slaves of dividogenesure.
But do not flatter yourself by thinking that this is only the fate of
Michigan. No, the people’s economic conditions are more or less similar
in all the States and Territories, and some States are much worse off
than Michigan, as the statistics show their situation.
Mr. D. R. Goodloe, in the “Forum” for November, 1890 (not knowing yet
the facts of the East), says:
“The conclusion from this melancholy array of facts is irresistible. The
virgin soil of the West is rapidly ceasing to be the home and [SN: A
CURSE OF HUMANITY.] the possession of the sturdy American freeman. He is
but a tenant at will, or a dependent upon the tender mercies of soulless
corporations and of absentee landlords. We have abolished monarchy, and
primogeniture, and church establishments supported by the State, yet the
universal curse of humanity, the monopoly of the earth by the wealthy
few, remains.” * * *
And I can tell Mr. Goodloe that these few have monopolized, not only the
earth of the country, but also the hundreds of cities and towns,
together with their buildings, their capital, their natural and
artificial wealth, their houses, etc., etc., and the tens of millions of
the inhabitants of these towns and cities too, have been economically
enslaved, under the system of dividogenesure, to the same wealthy few.