Remarks on the Notes to the Translation of Child (1753–1754)
(Effects of high interest)2 I am not sure whether it is correct to say that a high rate of interest impedes the circulation of money and that by making it liable to a charge, it compels us as it were to bury it by converting it into hoards or into plate. On the contrary, it appears at first glance that the higher is the rate of interest on money, the less of an encumbrance it should be for people, because it is a good’s low price that renders it troublesome to the owner. Thus if the opulent rentier invests his money in plate and jewels, it is not because opportunities for lending are wanting, but rather because they are on too easy terms, because people grow rich in too little time, because they soon prefer the pleasure of spending what they have acquired to that of increasing their wealth. Thrift lasting for some years is sufficient to restore a family’s fortune; this is followed by dissipation and by the enormous extension of luxury. Luxury is the fruit of the excessive inequality of wealth and idleness. Now, the high rate of interest of money causes the inequality of wealth because money attracts money and absorbs all the profits of industry. It produces idleness because it offers an easy means of growing rich without working.
KeywordsInterest Rate Public Debt Public Revenue Great Trade Popular Demand
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