It is the abuse, however, or the execs sive use of this form of credit, which is mischievous. If properly used, and within reasonable limits, it is as useful as credit in any other form. A few examples will suffice to illustrate this position. The receipts of different consumers are irre gular ; their consumption constant. With in the year their receipts and expenditure may be about the same ; but in point of time, they cannot be accurately balanced and adjusted one to the other. This system of credit enables them to provide for themselves and their families without privation, and at the cost of no one else. By an operation scarcely perceptible, their receipts and expenses are adjusted. lf, instead of satisfying their wants, they had suffered privation, trade would have been injured and capital employed less fully. Again, a man who pays for everything he consumes a year hence practically adds to his capital a sum equal to the value of his consumption. He gains a. whole year of productive industry in advance of his own subsistence. It is true that he will ulti mately have to pay for it, together with a high interest ; but if he has been able, in the meantime, to apply this additional capital so productively as to leave a balance in his favour, he has en riched himself and the community. The tradesmen who have trusted him, and the capitalists by whom they have been aided, will have made a profit upon his consump tion, and have realized the interest upon their loans ; while he will have given more employment to capital and to labour than he would have been able to give if he had been compelled to pay for his own subsistence from day to day.
In various other ways credit, in this form, is a valuable auxiliary to capital and industry; but whenever it is injudiciously given or accepted it becomes injurious. In this respect it does not differ from other forms of credit. The precise uses of credit in general have been already explained. In whatever form it is judi ciously and honestly applied it is an efficient agent in the circulation and pro ductive use of capital ; but whenever it is used without judgment or fraudulently abused, it becomes injurious, and wastes capital instead of encouraging its growth. AU great means conducive to social good are, unhappily, liable to perversion and abuse. The public credit of nations and mercantile credit have too often been abused, as recently, in the most signal manner, by the Americans ; and the system of tradesmen's credit has also been shamefully perverted ; but all alike are conditions inseparable from the applica tion of capital to the infinite purposes for which it is required. The advantages of credit are so great that it will always be extensively used in every form of which it is susceptible ; but its evils may be mitigated by the judgment and experience of capitalists, and by improved laws for adjusting the relations between debtor and creditor. [DEBTOR AND CREDITOR; NATIONAL DEBT.]