A man has no business to live in a style which his income cannot support, or to mortgage his earnings of next week or of next year, in order to live luxuriously to-day.  The whole system of Debt, by means of which we forestall and anticipate the future, is wrong.  They are almost as much to blame who give credit, and encourage customers to take credit, as those are who incur debts.  A man knows what his actual position is, if he pays his way as he goes.  He can keep within his means, and so apportion his expenditure as to reserve a fund of savings against a time of need.  He is always balanced up; and if he buys nothing but what he pays for in cash, he cannot fail to be on the credit side of his household accounts at the year’s end.

But once let him commence the practice of running up bills—­one at the tailor’s, another at the dressmaker’s and milliner’s, another at the butcher’s, another at the grocer’s, and so on,—­and he never knows how he stands.  He is deceived into debt; the road is made smooth and pleasant for him; things flow into the house, for which he does not seem to pay.  But they are all set down against him; and at the year’s end, when the bills come in, he is ready to lift up his hands in dismay.  Then he finds that the sweet of the honey will not repay for the smart of the sting.

It is the same as respects the poorer classes.  Not many years since, Parliament passed a law facilitating the establishment of Small Loan Societies, for the purpose of helping small tradesmen and poor people generally to raise money on an emergency.  The law was at once pounced upon by the numerous race of Graballs, as a means of putting money in their purse.  They gave the working classes facilities for running into debt, and for mortgaging their future industry.  A few men, desirous of making money, would form themselves into a Loan Club, and offer sums of money ostensibly at five per cent, interest, repayable in weekly instalments.  The labouring people eagerly availed themselves of the facility for getting into debt.  One wanted money for a “spree,” another wanted money for a suit of clothes, a third for an eight-day clock, and so on; and instead of saving the money beforehand, they preferred getting the money from the Club, keeping themselves in difficulties and poverty until the debt was paid off.  Such a practice is worse than living from hand to mouth:  it is living upon one’s own vitals.

It is easy to understand how the partners in the Loan Club made money.  Suppose that they advanced ten pounds for three months at five per cent.  It is repayable in weekly instalments at ten shillings a week,—­the repayments commencing the very first week after the advance has been made.  But though ten shillings are repaid weekly until the debt is wiped off, interest at five per cent, is charged upon the whole amount until the last instalment is paid off.  So that, though the nominal interest is five per cent., it goes on increasing until, during the last week, it reaches the enormous rate of one hundred per cent.!  This is what is called “eating the calf in the cow’s belly.”