The Northern Pacific farmer., 1885-04-16
THE CREDIT SYSTEM.
Tho Losses Sustained by Farmers In Conse-
qaence of tho Liberal Use Of Credit.

Tho Losses Sustained by Farmers In Conse
quence of the Liberal Use Of Credit.
Until about twenty-five years ago
ays Tile Chicngo Times, almost all tht
trade OF farmers was carried on by
means of barter. They exchanged the
products of their farms not only TO,
goods. but for the services of mechan
les: A farmer took a load of grain
fruit, or meat to the nearest town, and
exchanged it on the best terms he
could for articles he wanted for him.
self or family. Sometimes a farmer
would make a contract with some
country merchant to take his surplus
grain at the current price and receive
the worth of it in goods as he wanted
them: The majority of men hired to
do work on farms received little or no
cash. They took orders on the mer-
chants with whom their employers
traded. Hired girls received orders
for dry goods instead of money. Un-
less cash was expressly stipulated, the
majority of laborers expected to re-
ceive ''store pay'' for their work. In
many of the northern states, butter,
eggs. sheep pelus, and dried apples
took the place of money. They form
ed the great bulk of the currency, and
without them it would have been diff
cult to carry on a retail business.
lhey constituted the common circulat-
ing medium. They were refused by
scarcely any one. except the tax col
lector, the postmaster, and the travel
ing Snowman.
The civil war and the general intro
duction of railroads changed all this.
Ihe former was the means of causing
money to circulate freely, and indi-
rectly produced safe paper currency.
Ihe latter brought a cash market to
the neighborhood where almost every
farmer lived. At nearly every rail-
way station persons established them
selves who were ready to pay cash for
every article produced on farms.
Farmers now receive, or may receive,
cash for whatever they have to dispose
OF. They also have the means of as
certaining in every considerable town
on any day the price of every COM
modify in all the principal markets in
the world: A few traders in some
sparsely- settled districts continue to
do barter business tor the accommo-
dation of some of their customers.
But it is conducted on a cash basis.
The farmer knows the cash price of
the articles he sells as we'll as of those
he buys. In most towns, however,
one set of men buy products of farm
ers and pay money for them, while an
other set sell the goods that farmers
desire to purchase. The farmer no
longer asks how many pounds of su-
gar he can get for crock of butter at
a certain weight. Neither does he in
quire as to how many clothespins he
can obtain for dozen eggs.
Trade in one respect is now con-
Quoted in the country in the same
way that it is in cities. 1t is carried
on through the agency of money. 1t
is to be regretted that it is not always
conducted on cash basis as we'll as
on a money basis. The credit system
prevails to an almost alarming extent
among the farmers of the northwest.
Some classes of goods, notably agri-
cultural implements, are generally
sold on credit. The high prices asked
for most of them are chiefly due to the
fact that they are sold on long time
Ca+h was required to purchase mate
rials to make the implements and to
pay workmen for putting them to-
gether. Manufacturers and dealers
make a large addition to the prices of
articles that are sold on time. If the
practice of selling them on credit is
general, the cash buyers are assessed
to make up the losses that occur. In
some sections of the west it is rare to
find a farmer who is not in debt for
plows, harrows, seeders, moving and
reaping machines. The purchases are
generally made in anticipation of
large crops, which in many cases are
not raised. In the event of a satisfact-
ory crop, the money received for it is
generally all required to pay for the
machinery purchased to help produce
it.
The practice often indulged in by
farmers of having an open account
with merchants is not in the interest
of thrift and economy. Persons often
purchase articles that they do not
really need when they can obtain them
without the payment of money. They
see them in store, know that they can
obtain them on credit, have them added
to their account, and take them home.
When all the members of a farmers
family are allowed to obtain goods in
this way, it is no wonder that the ac-
count becomes very large, and that it
is all on one side of the journal or
ledger. The wonder is, taking the sea-
sons as they go, that the farmer has
any money after he has settled his
store bills with the money received
from the sale of his crop. There is
genuine pleasure in having money in
ones pocket. There is also genuine
pleasure in having money to spend for
articles wanted for present or future
use. Very few persons, however, ex-
perience much qualification in paying
out large sum of hard-earned money
for clothes that have been worn out,
food that has been eaten, and fuel that
has been burned. There is very little
pleasure in paying for past enjoyment.
No one is happy in paying for frollc
that occurred so long ago that it is
almost forgotten.
Much of the misery and many of the
of society come from an
money that is to be earned.
Many persons living in large towns
spend their wages week or month in
advance of the regular payday. They
are always in debt. and, of course, al
ways without ready money. They are
never in a situation to take advantage
of low market to lay in stock of the
things they are certain to need in a
short time. Let even short sickness
occur, or let them be turned out of
for a brief period, and
they are dependent on charity for sup
port. They are members of the great,
unthrifty multitude that is to be found
in every large city. The farmers pay
day comes at long and sometimes at
intervals. When it does
come, it should result in the reception
of money that can be used for present
and future wants and pleasures. If
all the money received for crops and