The Indiana State sentinel. [volume] (Indianapolis) 1868-1895, 1874-11-03
THE COOPERATIVE woRKINGMEN

THE COOPERATIVE WORKINGMEN
THE PROPOSED PLAN OF RELIEF IN LOUIS
vILLE-THE sCHULTZE-DELITZSCH SYSTEM
Its SUCCESS IN GERMANY-CO-oPERATI
STORES FOR wORKINGMEN.
The Louisville Commercial. in noticing a
meeting of the workingmen of that city
seeking for some method of cooperative re-
lief, speaks thus of the plans suggested: In
studying the wants of the workingmen.
Schultze- Delitzsch, the head OF German CO.
operation, reckoned among the greatest of
them inability to obtain loans on the same
terms that employers did. He saw that
man who had no guarantee to offer, except
his willingness and ability to work, pos
sessed in reality no security at all. We get
the idea from Schultze-Delitzsch. He
says: "No matter how probable that
an individual is honest, and can earn
enough 10 pay you, he may die, be robbed, or
be prevented in some other way from meet
ing his obligations; but a body OF individ-
uals is to be trusted. Skill and Willingness
to work. and the combination of this Skill,
this labor and their earnings, does count
for capitals perfectly good, negotiable
commodity" The idea of the object of the
association. The objections brought against
it at the first have been met and overcome
by the loan associations of the peoples
banks of Germany. These banks are formed
| by the wOrkiDgmen. Each men,
| Der subscribes for one share, which
| is all ne is entitled to hold. The price of
each share is equal 10 about 81 90 in our
| money. It is paid on entering. or in
monthly installmeDts after enterance. These
are, as a rule, as small as twelve and halt
cents. The entrance fee, which is from rs
cents to 81 80, and which goes toward the
reserve fund, is also payable in monthly IN
stallments. The profits of the banks are di-
| vided among the members in proportion to
the amount each has paid. Until a share is
| fully paid for the amount of the dividend upon
| Ii is credited in part payment. The number
of members is unlimited, and entrance is
allowed to any one who will subscribe to
the rules of the society. Withdrawal at any
| time is permitted, provided that due notice,
according to the statutes, be given. Any
Withdrawing member, however, is liable
for the debts formed by the society
during his membership, until dis
charged from that liability in such a
way as the association approves. The
question very naturally suggests itself,
HOW Is THE MONEY RAISED?
The collection of a few hundred shares of
81 so gives only a scsnT capital. The money
borrowed by the society is raised on the
joint credit of the members, in virtue of the
unlimited liability of all of them. Each
member is personally liable to the full ex-
tent O I his property This is the great I'M
DERIVING power-the foundation stone of
the system, and is the guarantee upon
which all loans are obtained. This, at
first, may be considered risky, and the
association may be obliged for a time
| to pay higher rates than the wholesale
market price, but it soon becomes established
as firmly as other financial institutions, and
can buy in the market on equal terms with
/ 4 - 49, L.
beers, it may be stated that the banks buy
money at wholesale. and sell it at retail to
their customers. Few people, doubtless,
realize what this means. The difference be-
tween the wholesale and retail prices is
greater than imagined. The. difference in
Germany is generally four per cent. For
instance, bank buys at four per cent.
and sells at eight per cent, then
there is a dividend of four per cent.
to be divided among its members.
This seems large margin, but American
workmen pay twenty and thirty per cent
on money that is borrowed in the first place
at from seven to ten per cent. The members
of these associations, then, can get loans at
the market rates. and they also receive divi-
dends which are in reality rebates on even
these rates. Money is merchandise. The
peoples banks OF Germany are cooperative
stores, dealing in money instead of bread
stuffs and groceries, and dealing out that
money equally. The banks loan money
only to their own members. This is one of
the main precepts of the Schultze- Delitzsch
plan. Another is never to lend money for a
longer term than that for which it has been
borrowed. The history of the peoples banks
of Germany shows
BRILLIANT RECORD.
At the closing of the Franco-German war
their number was 1871, an increase of III
during the war. OF these banks about 500
!
described. The others differed but slightly
from it. The progress made has been rapid
and substantial. In 1859 there were eighty
societies. In 1869 there were 735 societies,
and instead of is, 200 members, the number
had increased during the ten years to
304, 772. In 1859 the total of shares and re-
serve funds amounted to $685. In 1869 it
stood at IS, 400, 900. The borrowed capital in
1859 was $4,000, and in 1869 it had increased
to SS2,500,000. OF this sum nearly one half
consisted of savings deposits. The outbreak
of the Franco-German war exposed the