"Recently notice has been given by leading bankers of their intention to discriminate against municipal loans. And as things now stand, it is certain that, if an organised effort is made generally by the bankers throughout the country by advising clients against such investments and by refusing to accept municipal bonds as collateral security for overdrafts, &c.--a serious check will be put upon public enterprise. Those who imagine bankers either impotent or incapable of such treason against the public interest should remember what took place in the United States in 1893. "The natural suggestion to be offered as a counter-move to the threat of the bankers and their Industrial Freedom League is to add to those enterprises now under municipal control that of banking. And surely there is nothing which lends itself more easily to municipalisation! If the credit of a banking house can be employed for promoting enterprise and earning dividends, why cannot municipalities employ their own credit directly? In others words, why cannot the credit of a city be utilised to carry on its municipal works instead of it having to borrow the credit of a bank and pay interest charges? Consider how public works are now financed. The London County Council decides to build decent and respectable houses in some locality for the working classes. It requires, we will say, _500,000l._ with which to build dwellings for 2,000 families. Bankers are invited to tender for the loan, and finally the Council gets this advance on a guarantee of 3 per cent. per annum, the principal being repayable at the end of thirty-three and a third years. At the end of this period the Council will have paid the bank _500,000l._ in interest as well as the _500,000l._ original loan. The charge for the loan is equal to the entire cost of the whole undertaking; the result is that each family must pay about twice the amount of rent that it would otherwise have to pay if the Council had not incurred interest charges through borrowing other people's credit. Was there ever greater lunacy in public affairs? "Suppose that instead of issuing credit in the shape of bonds of large denomination, the Council issued it in notes of small denominations of pounds and shillings. Does anyone mean to assert that that credit which is eagerly purchased by a banker would be refused by a bricklayer or stonemason? Supposing the London County Council was empowered to issue its credit in one-pound notes, as well as large amounts, and supposing it was compulsory that these notes were good in payment of rates. Is there any question as to their being acceptable? The plan is so simple and so safe that at first it seems amazing it should have been so long out of employment."[761]