Galveston Labor Herald (Galveston, Tex.), Vol. 1, No. 16, Ed. 1 Saturday, November 16, 1912 Page: 1 of 8
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VOL. 1.
GALVESTON, TEXAS, SATURDAY, NOVEMBER 16, 1912.
No. 16
More About the Loan Shark Evil
As It Exists in Galveston
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How much have they
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tractor (while he also knew that the
covered $284.50 and costs.
ing for the pound of flesh.
323323332333
3 338
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home people. And, by the way, consid-
erable of the labor employed by the
San Antonio contractor came with him
and went away with him, I agree with
you, work that belongs to Galveston,
give to Galveston.
I am glad to see the Herald taking
up this question, and it deserves the
support of every well-thinking business
man of Galveston, and I desire that
you add my name to your list of sub-
scribers.
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Leading Galveston Attorney Exposes Their Methods and
Cites Cases In Which Borrowers Have Recovered from
the Sharks Twice the Sum Paid Them.
I
The Labor Herald’s Exposures of Last Week Meet with
Approval, and if the Victims Have Any Eight Left in
Them, the Loan Shark Evil Must Soon Be Extinct in
This Good City.
4
p)
Look at the picture “Scenes, Along Galveston Wharf Front.
Surely that’s what the lawyers call “the physical facts of the case.
o
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FAVORS GALVESTON WORK
TO GALVESTON CONCERNS.
——--o----
It cannot be denied that if Mr. Taft
made a good president, a very large
number of the voters of the country
failed to appreciate his efforts.
---------o---------
Labor and capital will never grasp
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“Who is Chief of Police.”
Galveston Labor Herald:
Your invitation to contribute an ar-
ticle on the tribute levied by the loan
sharks on the laboring men of our city,
is accepted with the hope that the dis-
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the city with the purpose of arranging
for the presentation of the moving-pic-
ture show which his organization has
had on the road for two seasons. The
plan is highly educational, and has won
unstinted praise rfom all who have
seen it.
and by virtue of the statute law of this
state, the borrower may recover from
the lender double the amount of usur-
ious interest paid within two years
next before the date of suit. This pro-
vision has been construed by our
courts to mean double the amount of
interest paid, not merely the excess
over the legal rate. It has always been
held that the mere form of the trans-
action is not the test, but the question
is whether or not the transaction is a
loan of money; if it is, and the rate of
Galveston, November 9, 1012.
Galveston Labor Herald:
Referring to your article in the Her-
ald of the 9th, “Do Business Concerns
Really Favor Home Industry?” brings
to mind the action of one of our city
commissioners a few years ago in
awarding a city contract. There were
two bidders on the reinforced concrete
storm drain on 29th Street. By a
strange coincidence both bids were ex-
actly the same to a cent, with the ex-
ception that one bidder, the home con-
tractor, stated in his bid that if the
excavations did not have to be hauled,
which he had previously ascertained
would not be allowed, he would allow
Beaumont loan company, doing busi-
ness in Galveston. He paid in / two
years $94.45 as interest, and the shark
still claimed more than the principal.
He brought suit in the Justice Court,
and the justice held as does Judge
Mann, that the contract was one for a
loan of money, usurious and void, and
rendered judgment, which was appeal-
ed to the County Court, with a similar
result, Judge Mann entering judgment
for L. for $188.90 and costs.
S. R., a colored man, borrowed sev-
eral amounts aggregating about $50,
paying 25 per cent interest per month.
He paid back at least four times that
sum in interest, and brought suits to
recover double what he had paid in
two years before date of suit. Both
of the Justice Courts and the- County
The above statemnt is taken from
facts proven by the court records of
Galveston County in cases tried in
court hence they are public property.
A few instances of such transactions
But it makes no difference. We don’t care. That’s what the
Bourbons said in France—but they wrecked their throne, and they
were a heap stronger than any body is toaay in power.
Whom must we blame?
We notice the otner papers have nothing to say. There is an
old story that the power of gold has choked justice for awnile, but
that later it triumpns. Ill-gotten goods may bring luxury, but not
happiness. How much, must we say?
permitted said nothing about it) in his
bid. The contract by all manner of
right should have been awarded to the
home contractor. The commissioner
was so anxious to save the city money
that he stated to the home contractor
that he would have to see what the
other contractor would allow. Of
course, the other contractor, knowing
that the home contractor had made an
allowance, and wanting the contract,
allowed $500.00 and the contract was
awarded to him. This contractor be-
ing a resident of San Antonio, I am in-
formed that he made enough money on
The following article is prepared at
the special request of the Labor Her-
ald, by a practicing attorney of Gal-
veston, who is well known to have a
thorough familiarity with the subject
of which he writes. His future ar-
ticles on the same subject will be
awaited with interest. The widest pos-
sible circulation and publicity of these
exposures is requested, to the end that
this great evil may be relieved, if not
absolutely wiped out of existence.
one dollar per foot, which would have
been about $900.00. The other con-
of the Boot and Shoe Workers, Inter-
hauling of the excavation would not be national Union would soon arrive in
genius.
We have some interesting exhibits—we are not putting all our
cards on the table. W e are nolaing our hanas like a canny Scot—
we don’t mean the Sons of Scott—tney are somewnat murky.
Watch for our next issue. We don’t want to tell, all we know,
though we do know that the people are just crazy for us to tell
them.
scheme is resorted to in order to con-
ceal or disguise th etransaction. Mills
vs. Johnson, 23 Tex. Sup., 329; Nichols
vs. Clairborne, 39 Tex. Sup Ct., 365;
Crozier vs. Stephens, 2 App. Cas., 802;
Watson vs. Aiken, 55 Tex. Sup. Ct.,
541; Lawrence vs. Griffin, 30 Tex. Sup.
Ct., 402; all adhere to the doctrine
above laid down.
Victims of these people should not
be discouraged from litigating their
rights, simply because they have no
receipts. Their word is as good and
better than that of the shark. The sub-
terfuge of salary assignments has been
exploded by the courts, and such trans-
actions have been held as matter of
law to Ve ordinary loans. Such salary
assignments are absolutely void in law,
as any competent- attorney can testify,
and for reasons which will be readily
apparent to every student of the law.
Employers of labor should refuse to
recognize any such assignments or or-
ders, but instead should lend their aid
and advice to those who are so un-
fortunate as to be victims of this vic-
ious system. The total exacted is too
heavy to be submitted to without a
hands until capital realizes that labor
this and ather contracts in this city has the right to live.
Galveston Labor Herald
OFFICIAL ORGAN OF GALVESTON LABOR COUNCIL AND AFFILIATED UNIONS.
left for her. You can see her begging in the picture.
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outside contractor; the home man was
They say that there is someboay who sticketh closer to the given the contract. This is patronizing
. . - to try him again, it would seem, but
-out 8ave him judgment, and he re- Fredericks and his backers are striv-
from cases actually tried in court.
F. C. borrowed at various times
from one company doing business in
Galveston, sums of money from $30 to
$50. He executed the usual salary
“assignment,” paying 20 to 25 per cent
interest per month, for from three to
four years; in other words, on a loan
of less than $50, he paid between $300
and $500 interest, and the shark still
claimed about $75 was due him. This
victim brought suit in our County
Court for double the amount of usur-
ious interest paid within two years,
attacked the assignment for fraud,
and Judge Mann sustained him, gave
him judgment for $536 and costs and
held that the alleged “assignment” of
salary was only a fraudulent device to
evade the usuary law.
W. T. borrowed from $20 to $35 at
different times, and executed the usual
salary assignment; he brought suit to
recover double the usurious interest
paid for two years, and recovered judg-
ment for $320.70 and costs, and cancel-
closures of the methods pursued by
these people will result in driving them might be herein recited; they are taken
The Galveston Labor Council met in
regular session last Monday evening.
The business transacted was gotten
through with in quick time.
Bro. William J. Deasy, who has filled
the office of recording secretary for
some time, tendered his resignation,
this action being by him deemed neces-
sary inasmuch as so much of his time
is occupied with other business that
it was impossible for him to do full
justice to the position. His resigna-
tion was accepted with regret. Bro.
Jamse P. Walsh of the Typographical
Union was selected to succeed Bro.
Deasy. Bro. Walsh has been active in
the labor interest in Galveston for
many years, and he assumes the duties
of the recording secretaryship with
the confidence of all that his discharge
of the duties will be complete.
Bro. J. W. Young was chosen read-
ing clerk.
New delegates from the Musicians’
Union were seated. They are: Bros.
H. Reed and Tony Pucciarello.
From the Barbers’ Union Bro. Wil-
son was seated as delegate.
It was announced that Bro. Baxter
ment, with the power to collect.
Now, if John Smith borrows less
than $50, and is a white man, the rate
is 20 per cent per month, so the assign-
ment states the consideration at 12;
if a negro, the rate is 25 per cent per
month, and the colored man pays an
extra 5 per cent only because his skin
is black. The same kind of documents
are executed by both. If at the end
of the month John Smith is unable to
pay, and will pay the interest, the
shark collects the interest and makes
John Smith sign a new paper of the
same sort; but if Smith cannot pay,
he is sized up, and if a bad prospect,
the shark files his “assignment” with
the employer and demands the full
amount; and as such borrowers are
generally employes of corporations and
railroads, the obliging (?) cashier hon-
ors same, deducts the amount from
Smith’s salary, and in some instances
at least takes his “bit,” and discharges
Smith as an object lesson to other vic-
tims.
But if Smith is a good prospect, and
the loan not too large, the interest is
added to the principal, and Smith ex- '
out of business. That the evil of pay-
ing ruinous rates of interest is sapping
the very life out of laboring-men in
their clutches, is apparent; for it
means abject poverty, and the denial
of the necessities of life, to satisfy the
rapacious maw of the loan shark.
The victim of the shark is lured to
ruin by the ease with which he can
obtain the first loan. Generally no se-
curity is asked, and the borrower se-
cures the money by signing an appar-
ently innocent paper, printed in small
type, which he is given no opportunity
to read. If he desires to inspect it
critically, an excuse is found for re-
jecting the loan. He wakes up to find,
that he has signed away every right
he possesses, save that of the air he
breathes; and the relentless shark
would require him to sign that away
also, if he had a means of enforcing
payment by cutting off the ozone.
These innocent documents recite
lation of the assignment, the judge
making the same ruling as in the pre-
vious case. Notwithstanding it was
clearly proven that T. had paid $160.35
as interest in two years, and as much
more in the two years previous, the
shark still claimed he owed much more
than he had originally borrowed.
W. N. borrowed less than $50, prom-
ised to pay 20 per cent per month and
executed the usual assignment; paid
$167.40 as interest within two years,
and brought suit to recover it and a
like sum as usurious interest; also to
cancel the assignment of salary. On
the trial, the facts being proven, the
county judge held the assignment void
as such, and that the transaction was
a loan of money at usurious interest,
no matter what the shark called it, and
entered judgment for N. for $334.80
and costs.
R. B. L. borrowed money from a
interest exceds 10 per cent per annum,
then it is usury, no matter by what man 111 power than does a brotner—in tact, the party can’t even
name the transaction is called, or what leave scnool witnout being accompanied by an oversnadowng evil
ecutes a new document, paying 20 to
25 percent compound interest—or in-
terest upon interest. But no papers
are ever returned to the victim, nor are
any receipts given on such transac-
tions. Frequently, in order to confuse
the borrower,1 renewals are made out
in slightly larger or smaller amounts,
and as no receipts are given, and no
old papers returned to the borrower,
the victim hesitates about atking ac-
tion in the courts, because he thinks
he has no evidence of the usurious con-
tract.
ago,” which, in our language, means Carthage must be destroyed
and locally means, if tney don’t do the ngnt thing they must be
wiped out. Remember our motto: "Delenaa est money lender with
otticial power without authority of law.”
Our issue of November 9th was read by everybody in Galves-
ton that could get a copy. See page 4.
Have those who are in charge of our city government read
that issue? We don’t know. We do know that nothing has been
done. We repeat the article. We shall call, if necessary, upon
them by name after this issue to find out whether they know the
things exist about which we complain. We had hoped it would
not be necessary. We shall mail by registered mail a copy to each
and every person whose duty it is to remedy the conditions, and if
necessary, if they receive the paper in that manner, we shall
state the fact of their receipt of the information. They can’t
dodge this paper—we are here—here to stay.
We think that it is necessary for the money lenders to get
money from somebody to carry on their business. From whom do
they get it? The banks? That’s where everybody gets money.
If not from the banks, from whom, and what business contract
have they with them? Its their business—maybe.
We ask the people to look into these matters for themselves.
Ring up 39 and ask for the Chief. If you don’t recognize the voice
get a squad from the “Tacoma” and go into the office and ask for
.c
P. L., another colored man, borrow-
ed about $15, and paid as interest in
two years $24.50. The shark still de-
manded his pound of flesh, and on the
trial P. recovered judgment for $49
with costs, and enjoined the shark
from attempting to collect the original
sum borrowed, Judge Mann making
the injunction permanent.
H. B. borrowed from four companies
about $75 four to five years ago; has
been paying on an average of $15 per
month, for from four to five years. In
other words, the sharks have collected
from him on a $45 loan, over $750 on
a bluff that if he didn’t pay they would
file his assignments and cost him his
job. This victim has refused to be
bluffed any longer, and papers are now
being prepared to make the sharks dis-
gorge, and it is pretty safe to say that
B. will recover judgments aggregating
$700, being double what he has paid
them within the past two years.
These are but a very few of the
cases, but there are hundreds of hun-
dreds of similar ones.
Our constitution provides, “See. 11,
Art. 16. All contracts for a greater
rate of interest than 10 per cent per
annum shall be deemed usurious. * *
home industry, and is one of the ways
to build a city. It left the money at
home and if the home contractor makes
any money, he spends it at home and
helps build up the city. If the six
houses that were built in San Antonio
with Galveston money had been built
here, they would have added to the
taxable values of this city for years to
come, and in my judgment, would have
been a good investment at the same
, Al
A Ay
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him—maybe you might recognize the voice. Would they let their
picture be taken when a conference is held every morning. Surely
there’s no secret. It don’t do to say “I didn’t do it,” and still by a
person’s action permit the things to continue. Pilate, after con-
demning Christ, thought he would escape criticism by washing his
hands and saying, “I am innocent of the shedding of this just man’s
blood.” What hypocricy. It doesn’t get by any more now than
it did at the time of the Savior. A stranger looked for the city
automobile, but didn’t see it stabled in the city stables lately. He
was told that it didn’t belong to the city, even if it was stabled be-
neath the City Hall.
to buid six nice houses in San Antonio.
How is that for patronizing home in-
dustry? Compare this transaction
with our sister city—Houston. They
told one of our contractors in the tin
line, if he wanted Houston contracts
he would have to move to Houston.
Again, at Shreveport, La., there was a
paving contract let. A home bidder
was 5 cents per yard higher than one
All Justice Loving Citizens Should Be
Arrayed on the Side of the Unfortunates
Scene Along the Wharf Front on Pay Day.
The poor pie woman, who only sells them pies, not first, almost last.
3
that in consideration of a sum of
money mentioned, the signer sells his
salary, past, present and future, no
matter where or by whom employed
and for a period of four years, to the
lender.
The language of the document is
carefully framed; and literally, the vic-
tim sells his salary outright—sells all
his saary for four years, no matter
by whom or where employed, and gives
the lender the right to receive and col-
lect it. Hence, if John Smith is work-
ing for $100 a month, and borrows $10,
he sells his salary for four years,
amounting to $41800, for $10. Of course,
the borrower thinks he signs the paper
as security for the loan; but the paper
reads that it is an absolute assign-
In Old Rome they had a motto. It was: "Delenda est Carth- price or even a small advance paid to
follows as sw .y and surely as day
follows the night.
In my next article, I will attempt to
expose the methods of these loan agen-
cies in making loans on chattel mort-
gages, with a suggestion as a remedy;
and in my third article, will offer some
suggestions for the further control of
the business of lending money on chat-
tels, and on unsecured paper, to be
enacted by the legislature, and to
which I shall invite the attention of
our senator and our two members of
the legislature.
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The second trial of Clarence Darrow
is now set for Nov. 25. It were useless
A Galvestonian.
-------------o------------
GALVESTON LABOR
COUNCIL MEETING.
struggle. The law provides an ample
remedy; one which relieves the victim
of the debt, and returns to him double
what 'he has paid within two years;
and the borrower should not permit
any false pride or threat of persecu-
tion to prevent him from asserting his
right to that which the people through
their legislature has given him. The
shark is a coward. He will fight be-
hind the back, but he won’t dare come
out in the open and litigate with his
victim, man to man, unless forced to
do so as a defendant; and then, he re-
sorts to technicalities and strained
constructions of the law, in the hope
to escape the just consequences of his
unlawful business; but he does not es-
cape, for the law is so well settled, and
so well known to the profession, that
a judgment for the victim, relieving
him of the debt, and awarding him
damages in dou’ he interest paid,
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Galveston Labor Herald (Galveston, Tex.), Vol. 1, No. 16, Ed. 1 Saturday, November 16, 1912, newspaper, November 16, 1912; Galveston, Texas. (https://texashistory.unt.edu/ark:/67531/metapth1481538/m1/1/: accessed July 18, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting Rosenberg Library.