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hands the burden of this cost has been transferred with it. Is it likely that men who acquire money by paying this cost will lend it to others without exacting this cost? If they should, they would be working for others for nothing,—a very different thing from "receiving pay for work they had not performed." No man can lend money unless he either issues it himself and pays the cost of making the tokens, or else buys or borrows it from others to whom he must pay that cost.




[Liberty, December 13, 1884.]

To the Editor of Liberty:

The "Picket Duty" remarks of November 22 in regard to the importance of "free money" (with which I mainly agree) impel me to say a few words upon the subject. It is desirable, it seems to me, that Liberty should give its ideas upon that subject in a more systematic form than it has yet done (1). To be sure, it is easy for those who think to see that, if all laws in regard to money were abolished, commerce would readily provide its instruments of exchange. This might be promissory notes, or warehouse receipts, bills of lading, etc.; but, whatever it might be, the Anarchist could not doubt it would be better than that ever issued under monopoly.

Theoretically, at least, Liberty has expressed the idea that any circulating medium should be made redeemable; but in what? If in gold, or in gold and silver, does it not involve the principle of a legal tender, or of a tender of "common consent?" and they do not greatly differ (2). It seems to me that the great fraud in regard to money starts just here, and vitiates all forms of finance as of trade (3). I define money to be a commodity or representative of a commodity, accepted by or forced upon the common consent, as an invariable ratio and medium of exchange. Now, since the price of all things else is variable and subject to extreme fluctuations, the dollar in exchange, and especially where the exchange is suspended as in borrowing, or buying on credit, becomes, as friend Pink suggests, a "war club" rather than a tool or instrument of commerce.

Pardon me if I inflict some technicalities upon the readers of Liberty. I would discard the use of the word value from questions of exchange, or else divide its several parts, as value in use, value in service and compensation, and value in exchange. But ratio is a much better word. I would then define the Ratio of Utility to be the proportion in which any thing or service effects useful ends, in sustaining human life or adding to human enjoyment,—a constant Ratio.

The Ratio of Service, the proportion in which different services, of the same duration in time, effect useful ends.

The Ratio of Exchange, the proportion in which one commodity or service will exchange for another service or commodity at the same time and place. This is a variable ratio, whose mean is the ratio of service.