of Liberty and Victory bonds, but no one would imagine that those add anything to the wealth of the nation as a whole. On the contrary the very purpose of those bond issues was to facilitate the waste of wealth in warfare. The persons, who in subscribing for the bonds loaned their own credit to the Government obtained through the bonds a mortgage on all the wealth of the country, or rather a lien on the future earnings of all the people.
It is appropriate here to explain the nature of the Liberty bonds and Victory notes to which the people of the United States subscribed during the war. These were not direct drafts on the wealth of the country, for as will presently be shown the wealth of the country consists of lands, houses, railways, etc., and no one can give a part of his house or his cattle. In fact the whole thing was a credit operation. Through his credit the subscriber obtained a means of payment whereby he paid for his bond. This credit might have been based in part on existing wealth and in part upon the prospect of new savings, which meant the creation of new wealth. As between the Government and the subscriber the Government obtained the command over goods which was surrendered by the subscriber, the Government entering into an obligation to return this in the future. The position of the American debt, as an internal affair, is that a corporation subscribing for $1,000,000 of Liberty bonds credited the nation with that number of dollars, taking the national bonds in return. Possibly it had to mortgage its physical property in order to do this. The Government converted these credits into the form of circulating medium, with which producers were paid for their raw materials, and
