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MONEY AND INTEREST.

his back, the hilarious crowd, if it does not forget his failure to perform the prescribed feat, at least good-humoredly forgives it. But I am not so good-natured. I admit that, as a clown, I find the editor interesting, but his performance, appropriate enough in a Barnum circus ring, is out of place in the economic arena. So I propose to ignore his three pages of antics and note only his ten-line slip between the elephant's legs, or, laying metaphor aside, his evasion of my question.

I had challenged him to point out any lending of capital in a typical banking transaction which I had described. He responds by asking me to define capital. This is the slip, the evasion, the postponement of the difficulty. He knows that, if he can draw me off into a discussion of the nature of capital, there will be an admirable opportunity for more clownishness, since there is no point in political economy that lends itself more completely to the sophist's art than this. But I am not to be turned aside. I stick to my question. In regard to the notion of capital the editor of To-day will find me, so far as the immediate question at issue is connected with it, the most pliable man in the world. I will take the definition, if he likes, that was given in the previous article in To-day. There it was said that money was one thing and capital another; that capital consists of the agencies of production, while money is only a means for the transfer of these; that what men really want is not money, but capital; that it is for the use of capital that interest is paid; and that this interest, this price for the use of capital, lowers, generally speaking, as capital becomes plentier, and probably cannot disappear unless abundance of capital shall reach the extreme of common property. Now I have shown (at least I shall so claim until my question is answered) that in the most ordinary form of transaction involving interest—namely, the discounting of notes—there is absolutely no lending of capital in the sense in which capital was used in To-day's first article, and the consequence, of course, is that that defence of interest which regards it as payment for the use of capital straightway falls to the ground. But if the editor of To-day does not like the view of capital that was given in the article criticised, he may take some other; I am perfectly willing. He may make a definition of his own. Whatever it may be, I, for the time being and for the purposes of this argument, shall say "Amen" to it. And after that I shall again press the question whether, in the transaction which I described, there was any lending of anything whatever. And if he shall then answer, as a paragraph

in his latest article indicates, "Yes, the bank lent its notes to