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gradually finding their way, not in name indeed, but in their essence, among all who take up the cause of education, with a view to fix it upon a right basis: we cannot then but consider Pestalozzi, with all his errors, with all his imperfections, and all his wants of philosophy, to have been a light in the world, which it will take some time to extinguish; and, in this view, a guide to his species, and a benefacter to mankind.*
THOSE who are at all conversant with the wants of the poor, will immediately acknowledge that the loan of a small sum in temporary emergency, or by way of capital, to be employed in industrious pursuits, is one of the best means of assisting the poor and industrious.
Our attention has been called to the subject by an interesting pamphlet, written by Francis Trench, Esq. on the advantages derived by the poor from these institutions. Speaking of the difficulties under which the poor labour, and their inability to provide for sudden emergency, Mr. Trench says—
"The impossibility of obtaining the use of a small sum of money at particular moments, frequently causes whole families to fall into sudden distress, from which they can never again extricate themselves; and frequently excludes an industrious man from all hope of bettering his condition, when opportunities arise; and this occurs even where it is evident that the means of subsequent repayment might be produced with ease and certainty.
"In fact, the accumulation of a sum, very trifling in the eye of the rich, is to the labouring classes a most difficult task. The rate of wages, and the means of employment, are seldom adequate to do more than provide the poor with the articles of daily and hourly necessity; so that however intelligent, labourious, and conscious of the benefit of possessing a few pounds for an unforeseen accident, or for the advancement of their condition by a small outlay, they are frequently unable to gather such an amount together. It is almost incredible what a series of sufferings and what destitution originate from this cause. "The poor man perisheth because of his poverty;' or, in other words, one impoverishing circumstance causes another, till he is utterly ruined; and the inability to obtain one article of comfort or necessity, prevents all hope of self-advancement in external circumstances. The experience of every one who has taken any interest in the affairs of the
*To those who wish to drink deeply into the spirit of Pestalozzi's method, we would recommend the perusal of his Plan of Education, by Dr. Biber, which contains copious extracts from his works, and extensive details of the practical parts of his method. We have frequently been obliged to refer to Dr. Biber's works, and have found in them so much sound philosophy, and true Christian character, as to recommend them to all-whether parents, teachers, or principals, as highly illustrative of the science of mind, and of true and natural views of teaching.
poor, will enable him to recall numerous instances illustrative of the above statement.
"A parent is often prevented from apprenticing a child to an advantageous trade, from the want of assistance towards the requisite premium and outfit.
"In the repairs of dwelling-houses, and other similiar instances, the poor often require to hire the labour of others, at a time when a small portion of such labour would save much ultimate expense, if they had but the means of commanding it.
"The artizan frequently is compelled to remain idle, from being unable to obtain the price of tools and the raw materials of work; and is thus entirely disabled from pursuing his branch of trade.
"Where any portion of land is held, the labourer frequently experiences much difficulty in obtaining seed for his ground, in purchasing a cow, pigs, or other profitable stock, and in effecting any improvement, or commencing operations on his small allotment.
One member of a family becomes incapacitated from work, by sickness or accident. To supply comforts and necessary relief, much immediate expenditure is requisite, the funds for which cannot be obtained, notwithstanding the comparative certainty that if a small sum could be borrowed for such an excellent purpose, the other members of the family, or the sick man on his recovery, would repay the money by weekly instalments.
Of the tendency of Loan Funds the following testimony is afforded— "Wherever a Loan Fund has been established, its tendency has not only been to prevent distress, but the invariable and immediate consequence has been to promote industry, honesty, sobriety, and other moral virtues, within the circle to which it extended, among that numerous class who from their situation looked forward to the possibility of wanting its aid at any future time. They see that none who are addicted to idle or vicious habits are considered worthy of receiving a loan, and there being a necessity of bringing forward a respectable person as security for each borrower, it soon is observed that such a guarantee cannot be obtained by any one who would be
* Those cases of want are only brought forward, in which there would be a fair prospect of repayment by small instalments.
+ I consider it well worth while to transcribe a few remarks of one at present engaged in the superintendence of the Fund from which the small table of English Borrowers has been taken. 'One striking point I have noticed, not only in those who are deriving the benefit of a loan, but in those who are anticipating one, viz. an emancipation from those habits which if continued, must have brought individuals to the necessity of applying for parochial aid. I am fully persuaded were Loan Societies generally established, and vigilantly looked after, the spirit of independence would be revived, and we should see the working classes strenuous in maintaining themselves, and encouraged by a feeling of being trusted with a loan, coming from those who have a confidence in the borrower's honesty. I have received repeated thanks for this trust, and all say they prefer it to a gift. The bringing into immediate contact the Borrowers and the Lenders has a most excellent effect.'
likely to prove a defaulter. The probability of personal loss, even if there was no other motive, will naturally prevent any person from becoming bound for the idle, the dishonest, or the drunkard; and the securities being frequently in the class of life immediately above that of the borrowers, have means of being intimately acquainted with their characters.
"Neither must it be forgotten, that a most desirable link or bond is formed between all classes by the existence of such an institution. The wealthy will probably supply funds for its maintenance, and having more leisure, will take an active part in its direction and superintendence; thus shewing a desire for the general welfare of their neighbourhood, and supplying several hundreds annually with a valuable species of relief. The middle classes usually give security, and thus prove their good opinion of those who deserve it. Individuals in this station will perhaps have one, two, or more poor persons whom they are willing to aid; and having such a small number to attend to, will be enabled to guard themselves against that deception, in regard to the character and circumstances of borrowers, which would unavoidably be practised on those who would have some hundreds on their books at the same time. The poorer objects of pecuniary assistance have been found most grateful for the benefits conferred upon them, and in general have zealously endeavoured to shew their conviction of the valuable nature of the relief by doing all in their power to fulfil the objects of the design."
There are many excellent authorities for the adoption of establishments of this kind; among these were Franklin and Dean Swift, both of whom bequeathed money, and arranged measures for the maintenance of such institutions after their death: that left by the former comprehended a scheme of vast magnitude, and thousands in America have been started in the world, or saved from folly in it, by the noble provision of Franklin. Adam Smith says, "money,' says the proverb, 'makes money,' when you have got a little, it is often easy to get more, the difficulty is to get that little." Colquhoun, in his work on the Police of the Metropolis, employs the annexed remarks, which are most applicable to the point in question: "In considering the innocent causes of indigence, it will be seen that the irremediable cases, requiring constant and permanent support, are few in number compared with those of useful labourers broken down for the moment, but who, by the judicious application of well-timed props, might be restored to society, and their industry rendered again productive."
Various are the places where the system of lending money has been adopted with signal success. In Bristol, a small capital which never exceeded £432, enabled a society, called "the Bristol Prudent Man's Friend Society," to circulate an amount of £14,303 among the necesitous and industrious, during the period from 1812 to 1825, where it is represented that small sums thus employed, have saved whole families from becoming dependent on charity and parochial aid. In Bath, a Loan Fund has been engrafted on the Mendicity Society of Monmouth Street; the annual sum lent has been about £640; the annual average deficit about £6; the number of families annually relieved about 240.
We cannot however do better than give the following extract from the report of the Parliamentary Committee of 1830, appointed to inquire into the distresses of that country, which it will be seen recommends the diffusion of the loan system most powerfully.
"As one mode of ascertaining the economical condition of the people of Ireland, your committee have considered the state of some of the charitable Loans and the accounts of the Savings' Banks.
"Under the first class of these institutions small loans are made to the necessitous, but trustworthy persons, which are repayable with interest, and re-applied in the same manner. Thus the charity not only supports itself, but the principal accumulates by the addition of interest.
"During the management of Mr. Baylee, a witness examined before your committee, the Pery Charitable Loan has more than doubled,— not a farthing of the money is idle; as soon as the amount of the Loan is collected, that Loan is instantly let out, and it is stated to have had the effect of producing habits of punctuality in the performance of their engagements.
"In Derry a similar charity was established, the fund having been created by collections at three charity sermons, preached by the Lord Bishop of Derry, by a Presbyterian minister, and by a Roman Catholic clergyman. A principal sum of £500 in small loans has, in twentyone years, been lent out in 12,600 small loans, giving relief to families containing 63,000 persons, and affording pecuniary assistance equal to £27,300. On this sum the loss by default of payment has not exceeded £7 18. Od.
"The same system has been applied with equally useful effects to the encouragement of industry among the fishermen; and it has been a most gratifying circumstance to your committee, to remark that a balance of the subscription raised in England in 1823, for the relief of Irish distress, continues to be usefully and benevolently applied to this purpose. Mr. Barry observes that the repayment of these small loans has been uncommonly regular, considering the miserable state of destitution in which these persons are; a fact which proves that there is a very current disposition, on the part of the peasantry, to avail themselves of any advantages which may be granted; and that there is a fair and honest disposition to make repayment when they are enabled so to do'.-Report, No. 1, p. 17.
"See also the interesting evidence of Mr. Godly.-Reports on the state of Ireland, 1825, p. 57.
"In the Meath Loan Fund, which is the largest in Dublin, only £8 has been lost by bad debts in ten years, and its beneficial effects are felt in every part of that city.
"At Castle Townshend, in the county of Cork, a fund was carried on for two years by a friend of the writer, during which time the utmost assistance was rendered to all descriptions of the poorer classes, and at the close of the period mentioned, when the fund was called in to be handed over to a new secretary, not a shilling was lost. and complete success were so striking, that upon this means were increased by subscriptions to more than original amount.
Its utility occasion its treble their
"One instance more. The writer was himself engaged in the management of a charitable Loan Fund, in one of the midland counties in Ireland, during the greater part of the first year of its establishment. The result of the first year's proceedings was as follows:-the original sum subscribed amounted to a little more than £100: £695 was circulated during the year: 425 persons obtained loans: 240 persons became securities: £1 5s. was lost, though made up within a few shillings, by fines of 6d. considered necessary and adopted in compliance with one of the rules. These facts are worthy of consideration.
"In Scotland a vast deal of benefit has resulted from banks and cash credits, nearly on the system here recommended; but they are chiefly for* a class above that of the labouring poor, and do not descend to a scale sufficiently low for them. One of the Parliamentary witnesses examined on the subject of Scotch Banking, observes, that a sum less than £50 is seldom lent. How desirable it is that the poorest and most numerous class of society should have similar advantages ! All improvement in man's condition is relative, and the use of a sum of from one to five pounds, may confer as much real and essential service on the poor, as hundreds or thousands could on those in a more elevated and wealthy station of life.
"These details have been given to shew that the writer is not advocating an untried or speculative plan, but merely desires to diffuse and extend a system already tried and approved of in various localilties.
"It would be unavailing to describe the advantages resulting from the plan, or to give examples of its success, unless the measures are recorded step by step, through which individuals practically interested on these topics might be able to realize it without needless toil, difficulty, or disappointment. The following account may perhaps appear a little protracted and tedious, but the mode here described of establishing the fund, of keeping the books, and of conducting the business, has been found so efficient, that it is not unworthy of being carefully examined; success chiefly or entirely depending on judicious management, and on maintaining a system of accounts that will occupy but little time, and present a clear and immediate view of the whole state of affairs relative to the money borrowed, the instalments repaid, &c. &c. The employment of two hours a week by two persons will be found sufficient for the direction of the whole charity, on the method here described."
The method of commencing, forming, and conducting a Loan Fund, will be found fully detailed in Mr. Trench's tract: it ought to be studied by all who are desirous of bettering the condition of the poor man, by teaching him how to assist himself. The plan described is not indeed one of those grand and captivating schemes, which are daily put forth, and as rapidly forgotten, but one which will work a silent unobtrusive way, like the little rivulet in the broad meadow,
* I have no wish to imply any doubt of the indirect good of the Scottish system to the labouring man;-from the supply of capital to the farmer and the general improver.
VOL. I.-Feb. 1835.