  Honesty relates to transactions in which money or other property is concerned. In its broadest sense, it forbids not only the violation of the rights of individuals, but, equally, acts and practices designed to gain unfair emolument at the expense of the community, or of any class or portion of its members. It enjoins not merely the paying of debts and the performance of contracts, but rigid fidelity in every trust, whether private or public. Its ground is intrinsic fitness; and a sense of fitness will suggest its general rules, and will always enable one to determine his duty in individual cases. Its whole field may be covered by two precepts, level with the humblest understanding, and infallible in their application. The first relates to transactions between man and man,—Do that, and only that, which you would regard as just and right, if it were done to you. The second embraces concerns that affect numbers or classes of persons,—Do that, and only that, which, were you the responsible trustee and guardian of the public good, you would prescribe or sanction as just and right. [pg 135] Notwithstanding the undoubted increase of dishonesty in recent times and its disastrous frequency, there can be no doubt that the majority of men are honest, and that the transactions in which there is no deception or wrong, largely outnumber those which are fraudulent. Were this not so, there could be neither confidence nor credit, enterprise would be paralyzed, business would be reduced to the lowest demands of absolute necessity, and every man would be the sole custodian of what he might make, produce, or in any way acquire. There can, therefore, be no element more directly hostile to the permanence, not to say the progress, of material civilization and of the higher interests which depend upon it, than fraud, peculation, and the violation of trust, in pecuniary and mercantile affairs, and with reference to public funds and measures. Yet there are methods, for which to a large degree honest men are responsible, in which dishonesty is created, nourished, and rewarded. In political life, if few office-holders are inaccessible to bribes, it is not because men of impregnable integrity might not, as in earlier times, be found in ample numbers for all places of trust; but because the compromises, humiliations, and concessions through which alone, in many of our constituencies, one can become the candidate of a party, are such as an honest man either would spurn at the outset, or could endure only by parting with his honesty. So long as men will persist in electing to municipal trusts those whose sole qualification is blind loyalty [pg 136] In addition to this complicity with fraud and wrong on the part of the public, there are many ways in which dishonesty engenders, almost necessitates dishonesty. A branch of business, in itself honest, may be virtually closed against an honest man. The adulterations of food, so appallingly prevalent, will suggest an illustration of this point. There are commodities in which the mixture of cheaper ingredients cannot be detected by the purchaser, and which in their debased form can be offered at so low a price as to drive the genuine commodities which they replace out of the market; and thus the alternative is presented to the hitherto honest dealer to participate in the fraud, or to quit the business. The former course is, no doubt, taken by many who sincerely regret the seeming necessity. [pg 137]Dishonesty not only injures the immediate sufferer by the fraud or wrong, but when it becomes frequent, is a public injury and calamity. In one way or another it alienates from the use of every honest man a very large proportion of his earnings or income. In this country, at the present time, we probably fall short of the truth in saying that at least a third part of every citizen's income is paid in the form of either direct or indirect taxation, and of this amount a percentage much larger than would be readily believed is pillaged on its way into the treasury or in its disbursement. Then, as regards bad debts (so-called), most of them fraudulently contracted or evaded, they are not, in general, the loss of the immediate creditor, nor ought they to be; he is obliged to charge for his goods a price which will cover these debts, and honest purchasers must thus pay the dues of the insolvent purchaser. Nor is this a solitary instance in which innocent persons are obliged to suffer for wrongs with which they seem to have no necessary connection. There are very few exceptions to the rule, under which, however, we have room but one more example. It is a well known fact that many American railways have not only cost very much more money than was ever laid out upon them, but are made, by keeping the construction-account long and generously open, to represent on the books of the respective corporations much larger sums than they cost,—especially in cases where the enterprise is lucrative and the dividends are limited by statute. [pg 138]Now in some sections of our country a transaction of this kind—essentially fraudulent, under however respectable auspices—is a disastrous check on productive industry by the heavy freight-tariff which it imposes,—so heavy sometimes as to keep bulky commodities, as wheat and corn, out of the markets where, at a fair cost for transportation, they might find remunerative sale. Thus the very means devised for opening the resources of a region of country may be abused to their obstruction and hindrance. In fine, dishonesty in all its forms has a diffusive power of injury, and, on the mere ground of self-defence, demands the remonstrance and antagonism of the entire community. While in most departments of conduct there is a wide neutral ground between the right and the condemnably wrong, there are matters of business in which there seems to be no such intermediate territory, but in which what is fair, honorable, and even necessary, is closely contiguous to dishonesty. Thus, except in the simplest retail business, all modern commerce is speculation, and the line between legitimate and dishonest speculation is to some minds difficult of discernment. Yet the discrimination may be made. A man has a right to all that he earns by services to the community, and these earnings may in individual instances reach an immense sum. We can easily understand how this may be, nay, must needs be the case with the very high salaries paid to master manufacturers. Such salaries would not be paid, did [pg 139] Thus also, when, in anticipation of a scarcity of some one commodity, a merchant so raises the price as essentially to diminish the sale, he earns his increased profits; for an enhanced price is the only practicable check on consumption. For instance, if at the actual rate of consumption the bread-stuff on hand would be consumed a month before the new harvest could be made availing, no statistical statement could prevent the month of famine; but experienced grain-merchants can adjust the price of the stock in hand so as to induce precisely the amount of economy which will make that stock last till it can be replaced. They will, indeed, obtain a large profit on their sales, and will be accused by ignorant persons of speculating on scarcity and popular apprehension; but it will be due wholly to their prescience that the [pg 140] The same principles will apply to speculation in stocks, which is in many minds identified with dishonest gain. Stocks are marketable commodities, equally with sugar and salt. They are liable to legitimate fluctuations in value, their actual value being affected, often by facts that transpire, often by opinions that rest on assignable grounds. Now if a man possess skill and foresight enough to buy stocks at their lowest rates and to sell them when they will bring him a profit, he makes a perfectly legitimate investment of his intelligence and sagacity, and in facilitating sales for those who need to sell, and purchases for those who wish to buy, and thus preventing capital from lying unused, or remaining inconvertible at need, he earns all that his business yields him by the substantial services which he renders. The legitimate business of the merchant and the broker is contingent, as we have seen, on fluctuations in the market, and he who has the sagacity to foresee these fluctuations and the enterprise to prepare for them, derives from them advantage to which he is fairly entitled. But it is precisely at this point that the stress of temptation rests, and the opportunity presents itself for dishonesty in ways of which the laws take no cognizance, and on which public opinion is by no means severe. The contingencies which sagacity can foresee, capital and credit can [pg 141] In the cases cited it may be seen how closely the right abuts upon the wrong, so that one may over-pass the line almost unconsciously. Yet it is believed that a man may determine for himself on which side of the line he belongs. The department of business, or the mode of transacting business, which cannot by any possibility be of benefit to the community, still more, that which in its general course is of positively injurious tendency, is essentially dishonest, even though there be no individual acts of fraud. He [pg 142] Among the many mooted cases in which the question of honesty is involved, our proposed limits will permit us to consider only that of usury14 (so-called). There can be no doubt that usury laws and the opinion that sustains them sprang from the false theory, according to which money was regarded, not as value, but merely as the measure of value. It is now understood that it owes its capacity to measure value solely to its own intrinsic value; that its paper representatives can equal it in purchasing power only when convertible at pleasure into coin; and that paper not immediately convertible can obtain the character of money only so far as there is promise or hope of its ultimate conversion into coin. It follows that money stands on the same footing with all other values,—that its use, therefore, is a marketable commodity, varying indefinitely in its fitting price, according as money is abundant or scarce, the loan for a long or a short period, and the borrower of more or less certain solvency. For ordinary loans the relations of supply and demand are amply competent to regulate the rate [pg 143] |
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