Front Page Titles (by Subject) LETTER VII.: EFFICACY OF ANTI-USURIOUS LAWS. - The Works of Jeremy Bentham, vol. 3
LETTER VII.: EFFICACY OF ANTI-USURIOUS LAWS. - Jeremy Bentham, The Works of Jeremy Bentham, vol. 3 
The Works of Jeremy Bentham, published under the Superintendence of his Executor, John Bowring (Edinburgh: William Tait, 1838-1843). 11 vols. Vol. 3.
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- Errata—vol. III.
- Defence of Usury; Showing the Impolicy of the Present Legal Restraints On the Terms of Pecuniary Bargains; In Letters to a Friend.
- Letter I.: Introduction.
- Letter II.: Reasons For Restraint—prevention of Usury.
- Letter III.: Reasons For Restraint—prevention of Prodigality.
- Letter IV.: Reasons For Restraint—protection of Indigence.
- Letter V.: Reasons For Restraint—protection of Simplicity.
- Letter VI.: Mischiefs of the Anti-usurious Laws.
- Letter VII.: Efficacy of Anti-usurious Laws.
- Letter VIII.: Virtual Usury Allowed.
- Letter IX.: Blackstone Considered.
- Letter X.: Grounds of the Prejudices Against Usury.
- Letter XI.: Compound Interest.
- Letter XII.: Maintenance and Champerty.
- Letter XIII.: To Dr. Smith, On Projects In Arts, &c.
- A Manual of Political Economy: Now First Edited From the Mss. of Jeremy Bentham.
- Chapter I.: Introduction. *
- Chapter II.: Analytical Survey of the Field of Political Economy.
- Chapter III.: Of Wealth.
- Chapter IV.: Of Population.
- Chapter V.: Of Finance.
- Chapter VI.: Operation of a Sinking Fund On the Production of Wealth.
- Chapter VII.: Noscenda.
- Observations On the Restrictive and Prohibitory Commercial System; Especially With a Reference to the Decree of the Spanish Cortes of July 1820.
- Preface.: Observations, &c.
- Section I.: Nature of the Prohibitory System.
- Section II.: Mischiefs of the Prohibitory System.
- Section III.: Causes of the Prohibitory System.
- A Plan For Saving All Trouble and Expense In the Transfer of Stock, and For Enabling the Proprietors to Receive Their Dividends Without Powers of Attorney, Or Attendance At the Bank of England, By the Conversion of Stock Into Note Annuities.
- Chapter I.: Plan For the Creation, Emission, Payment, and Eventual Extension, of a Proposed New Species of Government Paper, Under the Name of Annuity Notes.
- Chapter II.: Form of an Annuity Note. (see Table II.)
- Chapter III.: Comparison of the Proposed, With the Existing Government Securities, &c.
- Chapter IV.: Grounds of Expectation, In Regard to the Proposed Measure.
- Chapter V.: Financial Advantages.
- Chapter VI.: Advantage By Addition to National Capital.
- Chapter VII.: Advantage By Addition to Commercial Security.
- Chapter VIII.: Particular Interests Concerned.
- Chapter IX.: Rise of Prices—how to Obviate.
- Chapter X.: Reduction of Interest—proposed Mode Compared With Mr. Pelham’s.
- Chapter XI.: Moral Advantages.
- Chapter XII.: Constitutional Advantages.
- Chapter XIII.: Recapitulation and Conclusion.
- Appendix A.: Government Ought to Have the Monopoly of Paper Money, As Well As of Metallic Money.
- Appendix B.: Paper Money—causes Why Not Circulated By Government Without Interest, As Well As By Individuals.
- General View of a Complete Code of Laws.
- Chapter I.: General Division.
- Chapter II.: Relations Between the Laws Concerning Offences, Rights, Obligations, and Services.
- Chapter III.: Relation Between the Penal and Civil Code.
- Chapter IV.: Of Method.
- Chapter V.: Plan of the Penal Code.
- Chapter VI.: Of the Division of Offences.
- Chapter VIII. Titles of the Penal Code.
- Chapter IX.: First General Title of the Civil Code, * of Things.
- Chapter X.: Second General Title of the Civil Code. of Places.
- Chapter XI.: Third General Title of the Civil Code. of Times.
- Chapter XII.: Fourth General Title of the Civil Code. of Services.
- Chapter XIII.: Fifth General Title of the Civil Code. of Obligations.
- Chapter XIV.: Sixth General Title of the Civil Code. of Rights.
- Chapter XV.: Seventh General Title of the Civil Code. of Collative and Ablative Events.
- Chapter XVI.: Eighth General Title of the Civil Code. of Contracts.
- Chapter XVII.: Ninth General Title of the Civil Code. of the Domestic and Civil States.
- Chapter XVIII.: Tenth General Title of the Civil Code. of Persons Capable of Acquiring and of Contracting.
- Chapter XIX.: Of the Particular Titles of the Civil Code.
- Chapter XX.: Of Elementary Political Powers.
- Chapter XXI.: Of Elementary Political Powers— Subject Continued.
- Chapter XXII.: Plan of the Political Code.
- Chapter XXIII.: Plan of the International Code.
- Chapter XXIV.: Plan of the Maritime Code.
- Chapter XXV.: Plan of the Military Code.
- Chapter XXVI.: Plan of the Ecclesiastical Code.
- Chapter XXVII.: Plan of Remuneratory Laws.
- Chapter XXVIII.: Of Political Economy.
- Chapter XXIX.: Plan of the Financial Code.
- Chapter XXX.: Plan of Procedure Code.
- Chapter XXXI.: Of the Integrality of the Code of Laws.
- Chapter XXXII.: Of Purity In the Composition of a Code of Laws.
- Chapter XXXIII.: Of the Style of the Laws.
- Chapter XXXIV.: Of the Interpretation, Conservation, and Improvement of a Code.
- Pannomial Fragments.
- Chapter I.: General Observations.
- Chapter II.: Consideranda.
- Chapter III.: Expositions.
- Chapter IV.: Axioms.
- Nomography; Or the Art of Inditing Laws: Now First Published From the Mss. of Jeremy Bentham.
- Chapter I.: The Subject Stated.
- Chapter II.: Relations.
- Chapter III.: Proper End In View.
- Chapter IV.: Imperfections Primary.
- Chapter V.: Explanations Relative to the Imperfections of the Second Order.
- Chapter VI.: Of Remedies. *
- Chapter VII.: Of Language.
- Chapter VIII.: Of the Perfections of Which the Legislative Style Is Susceptible.
- Chapter IX.: Of Forms of Enactment.
- Appendix. Logical Arrangements, Or Instruments of Invention and Discovery
- Equity Dispatch Court Proposal; Containing a Plan For the Speedy and Unexpensive Termination of the Suits Now Depending In Equity Courts. With the Form of a Petition, and Some Account of a Proposed Bill For That Purpose
- Section I.: Purpose Explained. Jeremy Bentham to the Honest and Afflicted Among Equity Suitors.
- Section II.: Equity Suitors’ Petition For Dispatch Court. to the King’s Most Excellent Majesty, —
- Section III.: Dispatch Court Bill—some Account of It.
- Section IV.: Information Requisite From Petitioning Suitors.
- Equity Dispatch Court Bill: Being a Bill For the Institution of an Experimental Judicatory Under the Name of the Court of Dispatch, For Exemplifying In Practice the Manner In Which the Proposed Summary May Be Substituted to the So Called Regular Sy
- Editor’s Note.
- Part I.—: Judiciary.
- Section I.: Judge Located, How.
- Section II.: Remuneration.
- Section III.: Registrar, &c.
- Section IV.: Eleemosynary Advocate.
- Section V.: Judges’, &c. Deputes.
- Section VI.: Judge’s Powers—exemptions—checks.
- Section VII.: Prehensors and Messengers.
- Section VIII.: Consignees; * Or Say, In-trust-holders.
- Section IX.: Grounds of Decision For the Dispatch Court Judge.
- Section X. ‡: Suits’ Comparative Suitableness; and Order of Cognizance.
- Section XI.: Auxiliary Judges and Accountants.
- Section XII.: Sittings, Times Of.
- Part II.—: Procedure.
- Section XIII.: Definitions. *
- Section XIV.: Examination of Solicitors.
- Section XV.: Initiatory Examination of Parties, &c.
- Section XVI.: Appropriate Intercourse, Constant and Universal, Secured.
- Section XVII.: Mutual Security For Forthcomingness of Persons and Things. ‡
- Section XVIII.: Evidence-procuring Money, How Provided.
- Section XIX.: Subsequential Evidence, How Elicited.
- Section XX.: Execution, How Performed.
- Section XXI.: Equity Court Costs, How Disposed Of.
- Section XXII.: Dispatch Court Costs, How Disposed Of.
- Section XXIII.: Eventual Retrotransference of a Suit to the Equity Court.
- Section XXIV.: Expense of the Court, How Provided For.
- Supplemental Sections:—
- Section I. Or XXV.: Bankruptcy and Insolvency.
- Section II. Or XXVI.: Henceforward Dispatch Court.
- Schedules to the Bill.
- Plan of Parliamentary Reform, In the Form of a Catechism, With Reasons For Each Article: With an Introduction, Showing the Necessity of Radical, and the Inadequacy of Moderate, Reform.
- Section I.: History of the Ensuing Tract—alarming State of the Country and the Constitution.
- Section II.: Most Prominent Present Grievance, Gareisoning France.
- Section III.: Causes of the Above and All Other Mischiefs:—particular Interests Monarchical and Aristocratical, Adverse to the Universal—their Ascendency.
- Section IV.: Sole Remedy In Principle—democratic Ascendency.
- Section V.: Remedy In Detail: Radical Parliamentary Reform: Elementary Arrangements In This Edition of It—their Necessity.
- Section VI.: Differences Between This and the Original Editions of Radical Reform.
- Section VII.: Virtual Universality of Suffrage Further Considered.
- Section VIII.: Virtual Universality of Suffrage—its Undangerousness.
- Section IX.: Freedom of Suffrage Further Explained—seductive Influence—its Forms, Instruments, &c.
- Section X.: Bribery and Terrorism Compared.
- Section XI.: Purchase of Seats—in What Cases Mischievous—in What Beneficial.
- Section XII.: Secresy of Suffrage—its Importance Further Developed.
- Section XIII.: Exclusion of Placemen, &c. From the Right of Voting—mischievousness and Profligacy of the Opposite Arrangement.
- Section XIV.: Universal Constancy of Attendance—its Importance.
- Section XV.: Representatives—impermanence of Their Situation—its Importance:—objections—their Groundlessness.
- Section XVI.: Moderate Reform—its Arrangements—their Inadequacy.
- Section XVII.: Trienniality Inadequate;—annuality Necessary.
- Section XVIII.: Interests Adverse to Adequate Reform—support Given By Them to Moderate, to the Exclusion of Radical: Tories—whigs—people’s Men.
- Catechism of Parliamentary Reform; Or, Outline of a Plan of Parliamentary Reform; In the Form of Question and Answer; With Reasons to Each Article.
- Section I.: Ends to Be Aimed At On the Occasion of Parliamentary Reform.
- Section II.: Means, Conducive Towards These Ends.
- Section III.: Means—their Uses, With Reference to Their Respective Ends.
- Section IV.: Means Conducive to Aptitude In Members: I. Placemen Not to Vote, Nor to Be Seated By Election.
- Section V.: Means, &c. Continued.—ii. Placemen Seated By the King, With Speech and Motion, Without Vote.
- Section VI.: Means, &c. Continued.—iii. Elections Frequent—annual.
- Section VII.: Means, &c. Continued.—iv. Speeches Authentically and Promptly Published.
- Section VIII.: Means, &c. Continued.—v. Attendance, Punctual and General, Secured.
- Section IX.: Inconveniences Incident to Elections, and Election Judicature.
- Section X.: Election Inconveniences—means For Their Removal.
- Section XI.: Collateral Advantages, Referable to the Situations of Electors, Placemen, Lords, &c.
- A Sketch of the Various Proposals For a Constitutional Reform In the Representation of the People, Introduced Into the Parliament of Great Britain, From 1770 to 1812.
- Radical Reform Bill, With Extracts From the Reasons.
- Preliminary Explanations.
- Title of the Proposed Act.
- Section 1.—: Seats and Districts.
- Section 2.—: Electors, Who.
- Section 3.—: Eligible, Who.
- Section 4.—: Election Offices.
- Section 5.: Election Apparatus.
- Section 6.—: Promulgation of Recommendations In Favour of Proposed Members.
- Section 7.—: Voters’ Titles Pre-established.
- Section 8.—: Election, How.
- Section 9.: Election Districts and Polling Districts, How Marked Out.
- Section 10.—: Vote-making Habitations, How Defined.
- Section 11.—: Members’ Continuance.
- Section 12.—: Vacancies Supplied.
- Section 13.—: Security For the House Against Disturbance By Members. †
- Section 14.—: Indisposition of Speakers Obviated.
- Appendix, Including General Explanations.
- Radicalism Not Dangerous. Extracted From the Mss. of Jeremy Bentham. *
- Part I.—: Introduction.
- Section I.: Radical Reform Bill Recapitulated.
- Section II.: Persuasion of the Dangerousness of Radicalism—cause of It, and of the Vituperative Expression Given to It.
- Section III.: Terms of the Accusation,—speeches From the Throne, 16 Th July and 21 St November 1819.
- Section IV.: The Accusation In General Terms—counter-averment.
- Section V.: Plan of This Defence.
- Part II.—: Deference From the General Nature of the Case.
- Section I.: Conditions Necessary to a Man’s Embarking In Such a Design.
- Section VII.: Concurrence In Any Other Extensive Plan of Spoliation Impossible.
- Section VIII.: Concurrence of Any Constituted Authorities Impossible.
- Section IX.: Accomplishment Impossible—design Impossible.
- Section X.: The Talked-of Spunge No Proof of the Design.
- Part III.—: Defence From Experience In the Case of the United States.
- Part IV.: Defence From Particular Experience In the Case of Ireland: Years 1777 Or 1778, to 1783.
- Section I.: Analogy Between This and the Previous Case.
- Section II.: Democratic Ascendency, How Produced.
- Section III.: Fruit of Democratic Ascendency a Golden Age.
- Section IV.: Coincidence of Its Characters With Those of Radicalism.
- Section VI.: Extinction of Democratic Ascendency and Reform—restoration of Monarchico-aristocratical Ascendency, and Its Consequences.
EFFICACY OF ANTI-USURIOUS LAWS.
Before I quit altogether the consideration of the case in which a law, made for the purpose of limiting the rate of interest, may be inefficacious with regard to that end, I cannot forbear taking some further notice of a passage already alluded to of Dr. Smith’s: because, to my apprehension, that passage seems to throw upon the subject a degree of obscurity, which I could wish to see cleared up in a future edition of that valuable work.
“No law,” says he, “can reduce the common rate of interest below the lowest ordinary market rate at the time when that law was made. Notwithstanding the edict of 1766, by which the French king attempted to reduce the rate of interest from five to four per cent., money continued to be lent in France at five per cent., the law being evaded in several different ways.”
As to the general position, if so it be, so much, according to me, the better: but I must confess I do not see why this should be the case. It is for the purpose of proving the truth of this general position, that the fact of the inefficacy of this attempt seems to be adduced: for no other proof is adduced but this. But, taking the fact for granted, I do not see how it can be sufficient to support the inference. The lw, we are told at the same time, was evaded: but we are not told how it came to be open to evasion. It might be owing to a particular defect in the penning of that particular law; or, what comes to the same thing, in the provisions made for carrying it into execution. In either case, it affords no support to the general position: nor can that position be a just one, unless it were so in the case where every provision had been made that could be made, for giving efficacy to the law. For the position to be true, the case must be, that the law would still be broken, even after every means of what can properly be called evasion had been removed. True or untrue, the position is certainly not self-evident enough to be received without proof: yet nothing is adduced in proof of it but the fact above noticed, which we see amounts to no such thing. What is more, I should not expect to find it capable of proof. I do not see what it is that should render the law incapable of “reducing the common rate of interest below the lowest ordinary market rate,” but such a state of things, such a combination of circumstances, as should afford obstacles equally powerful, or nearly so, to the efficacy of the law against all higher rates. For destroying the law’s efficacy altogether, I know of nothing that could serve, but a resolution on the part of all persons anyway privy not to inform: but by such a resolution, any higher rate is just as effectually protected as any lower one. Suppose the resolution, strictly speaking, universal, and the law must in all instances be equally inefficacious—all rates of interest equally free; and the state of men’s dealings in this way just what it would be, were there no law at all upon the subject. But in this case, the position, in as far as it limits the inefficacy of the law to those rates which are below the “lowest ordinary market rate,” is not true. For my part, I cannot conceive how any such universal resolution could have been maintained, or could ever be maintained, without an open concert, and as open a rebellion against government; nothing of which sort appears to have taken place: and, as to any particular confederacies, they are as capable of protecting any higher rates against the prohibition as any lower ones.
Thus much, indeed, must be admitted, that the low rate in question, viz. that which was the lowest ordinary market rate immediately before the making of the law, is likely to come in for the protection of the public against the law, more frequently than any other rate. That must be the case on two accounts: first, because, by being of the number of the ordinary rates, it was, by the supposition, more frequent than any extraordinary ones: secondly, because the disrepute annexed to the idea of usury, a force which might have more or less efficacy in excluding from the protection above spoken of such extraordinary rates, cannot well be supposed to apply itself, or at least not in equal degree, to this low and ordinary rate. A lender has certainly less to stop him from taking a rate which may be taken without disrepute, than from taking one which a man could not take without subjecting himself to that inconvenience: nor is it likely that men’s imaginations and sentiments should testify so sudden an obsequiousness to the law, as to stamp disrepute to-day, upon a rate of interest to which no such accompaniment had stood annexed the day before.
Were I to be asked how I imagined the case stood in the particular instance referred to by Dr. Smith,—judging from his account of it, assisted by general probabilities, I should answer thus:—The law, I should suppose, was not so penned as to be altogether proof against evasion. In many instances, of which it is impossible any account should have been taken, it was indeed conformed to: in some of those instances, people who would have lent otherwise, abstained from lending altogether; in others of those instances, people lent their money at the reduced legal rate. In other instances, again, the law was broken: the lenders trusting, partly to expedients recurred to for evading it, partly to the good faith and honour of those whom they had to deal with: in this class of instances it was natural, for the two reasons above suggested, that those where the old legal rate was adhered to, should have been the most numerous. From the circumstance, not only of their number, but of their more direct repugnancy to the particular recent law in question, they would naturally be the most taken notice of. And this, I should suppose, was the foundation in point of fact for the Doctor’s general position above mentioned, that “no law can reduce the common rate of interest below the lowest ordinary market rate at the time when that law was made.”
In England, as far as I can trust my judgment and imperfect general recollection of the purport of the laws relative to this matter, I should not suppose that the above position would prove true. That there is no such thing as any palpable and universally notorious, as well as universally practicable receipt for that purpose, is manifest from the examples which, as I have already mentioned, every now and then occur, of convictions upon these statutes. Two such receipts, indeed, I shall have occasion to touch upon presently: but they are either not obvious enough in their nature, or too troublesome or not extensive enough in their application, to have despoiled the law altogether of its terrors or of its preventive efficacy.
In the country in which I am writing, the whole system of laws on this subject is perfectly, and very happily, inefficacious. The rate fixed by law is 5 per cent.: many people lend money; and nobody at that rate: the lowest ordinary rate, upon the very best real security, is 8 per cent.: 9, and even 10, upon such security, are common. Six or seven may have place, now and then, between relations or other particular friends: because, now and then, a man may choose to make a present of one or two per cent. to a person whom he means to favour. The contract is renewed from year to year: for a thousand roubles, the borrower, in his written contract, obliges himself to pay at the end of the year one thousand and fifty. Before witnesses, he receives his thousand roubles; and, without witnesses, he immediately pays back his thirty roubles, or his forty roubles, or whatever the sum may be, that is necessary to bring the real rate of interest to the rate verbally agreed on.
This contrivance, I take it, would not do in England: but why it would not, is a question which it would be in vain for me to pretend, at this distance from all authorities, to discuss.