The Mitchell capital. (Mitchell, Dakota [S.D.]) 1879-1918, 1891-04-17
THE FARMERS ALLIANCE IN POL,
~ iTIcs.

THE FARMERS ALLIANCE IN POL
iTIcs.
E. V. Smalley in Northwest Maga-
zine: 1t is curious fact that farmers.
who are, as a rule, strong and clear
thinkers wit hin the range of their own
experience and interests, are pretty
sure to do stupid things, which, react
upon themselves, whenever they get
control of a legislative body. The Far
mers' Alliance is having great swing
just now, in the prairie states of the
West. Its representatives are present
in large numbers in the legislatures of
those states. They were elected to pass
laws that would benefit the agricultural
class. The first thing they seek to do,
whether it be in Kansas, Nebraska, or
Minnesota, is to strike at capital. They
appear toregard the capitalist as sort
of ogre. living somewhere down East,
who devours the substance of the far
mers of the West. They must make
him smart in some way; SO they bring
in bills to reduce the interest, to tax
mortgages held outside the state where
the mortgaged property is loca-
ted, and to hamper the business of rail-
roads and cut down their earning be-
yond the limit of possibility of paying a
fair return on the money invested in
them.
All this is on par for stupidity with
the action of the fellow who sawed of
the limb he was sitting on, between him
self and the trunk of the tree. Capital
is as necessary to the prosperity of the
West as rain to the growth of the crops.
Every new country has labor and land
and resources in the way of natural pro-
ducts, but it has no noaccumulated capital.
Every old country, if fairly endowed by
nature, has a surplus of capital to loan.
In the West the cities have been built
the railroads constructed and the farms
opened with the aid of Eastern capital.
The boundary between the loaning sec
tion of the country and the borrowing
section is constantly advancing West.
A generation ago it was the Allegheny
Mountains. Now it runs little west of
Chicago. In twenty years more Mime
sofa will be lending state instead of a
borrowing one. 1t takes time and labor
to conquer new region, compel nature
to yield up her wealth, provide the COM
forts OF high civilization with all its
equipment of education, religion and
philanthropy, and enable the popula-
tion to accumulate a surplus Of capital
beyond what can be proftably used at
home. To cut off the fertilizing stream
of capital from a new community or
even to impede or check the freedom
of its flow is to insure hard times and
invite disaster. The rate of interest is
always higher in new communities than
in old ones, because the security is not
as good and the capital must pass
through the hands of middle men who
charge for their services. The owner
of an old and we'll improved farm in
Pennsylvania, with its fences, orchards
and substantial buildings, can borrow
money at a less rate of interest than
the owner of a stretch of prairie in
North Dakota, who has nothing to
show upon it but patch of breaking
and shanty.
If a Western farmer needed to hire
horses to work his fields he would not
think it smart thing for the legisla-
ture to pass law fixing the hire of
horses at a price below what the owners
could let them go for, and adding pains
and penalties of imprisonment and con-
6scation in case higher rate should
be demanded. If such law should be
passed he would expect the horse own
ers to go somewhere else where they
could find better and safer market
for their stock. Yet this is exactly
what the Farmers Alliance, in many of
the Western states, is trying to do
with capital. If they have their way
they will drive money out of their COM
munities and pay the penalty in bank
ruptcy and misery.
1t is proper for statutes to fix the rate
of interest where no rate is named in
the note, but to fix castriron limit on
the right of contract is injustice and
folly. 1t is particularly unjust towards
the poorer classes who have no security
to offer that is frst-class and who un-
der such law would be cut off from all
chance of borrowing money. It is the
man who wants to borrow on second
mortgage to save his farm from sale
under first mortgage; or the man who
needs money to develop some enter
prise of untried merit that pays high
interest and is glad to pay high inter-
est if he can get what he sorely needs.
The owner of big building in ST. Paul,