The Atlanta constitution. [volume] (Atlanta, Ga.) 1885-19??, 1893-04-11
Farmers buying on Credit.

interests of agriculture all over the country
We believe that the almost universal prac-
tice of buying on credit has been the
most damaging and depressing in its eff
fccts. On careful inquiry into the caus-
es which have led to the practice we have
been unable to find anything in the history
of the past, or anything that is now operat-
ing, that justlties or cOmpels 4 continu-
ance of the system. Indeed, it is not
worthy to be dignifed with the title of
SYSTEM as it is a mere habit, and a
most pernici0uS one 1t has been usual 10
attribute 1t to the losses resulting from the
late war, and the farmer, III particular,
has been justified in the score of loss of
slave property and the so-called destruction,
of capital. This, however, will not "hoN
water for it is Il fact that Il very la
majority OF the present farmers of y
late slave states never owned slay(let
Moreover, the practice is Just as wide
spread lii the northwestern states as it ie
IL the south. Z
We do not propose to institute search
ing inquiry into the causes and origin oil
the present credit system, but simply to-
say that 1t is an unnitigated evil and
ought to be abolished Its practice in in
diyldual cases is generally the badge and
proof OF Improbable methods Of farming
Now we do not mean to say
mat Il farmer should never
borrow money, although we will say thar
he should beware of borrowing money ex-
cept III case of absolute necessity On the
contrary, Ii n man is so unfortunate as to
be placed IN II position that he must either
borrow money or buy on credit, or beg, or
steal, or starve or go naked we would
justify him in adopting the alternatives
IN the order in which they are here printed
borrowing money with which to pay cash is
the least of the evils ard is named first. 1t
is the only sensible way of buying on
credit and yet ii should not be rcs0rted TO
except III case of pressing necessity as a
choice OF evils, The interest demanded for
money-cYorbltant as the rate certainly
ISIS much less than the difference be-
tween the cash and credit prices of goods
ms IS perhaps fully explained by the fact
mat III money transaction the borrower
Knows what he is 10 pay for the use Of the
moHey-the rate percent. while i'll the case
Of buying goods on credit the buyer rarely
SHOWS or cares to inquire what per cent
OF TIE cash price IS charged gainst him
Inc merchant himself is not particular about
th9t he takes care to make his credit
pHceS high enough at the beginning of the
buying season to yield him q tremendous
interest not less than 50 per cent per an
AHn ~ tie majority Of cases and frequently
ually November list. AS the season adyan-
cess, credit prices remaining The
same. the rate of interest or
craht charge constantly increases be,
cause the time is becoming shorter As
minimizing man would say that Is cor ~! 10
pound Tor bacon bought now, Atrta D"
and to be paid for October list, woui,
cheaper than to pay > cents month-...t
per cent per annum- for money with which
10 pay II cents per pound cash for the same
bacon. But he would be wide of the truth
me y cents per pound charged for the
SIX months credit is Just so per cent rer
aunum against ~ per cent per annum
which he would have to pay for Tie money,
Moreover the merchant has probably paid
notmore than 10 cents per pound for his
bacon. If he sells it for II cons cash,
he realizes. at once, profit ~ - pc,. cent
on the cost. If he sells ut Is cents
pound on six months time he viii realize-if
he collects the debt at the end of The credit
porlod-the profit and interest together 100
per cent per annum on the first cost! Ana
who pays this profit and interest? Why
the farmer who buys the lacon. II is o1litp
true that the merchant does not collect all
his debts; some he loses entirely; some h.
collects by the aid of the law ana at the
expense of lawyers commissions But
those who nay the merchant make good the
losses incurred through those who DO rot
pay or who are forced to pay by the process
Of law.
The moral and application is: Farmers
don't buy on credit. if You have to borrow
the money to paw cash, The nose remote
application is don't buv what YOU don't
need and produce at home what You lc-
qlire if it can be done at less cost than you
viii have to pay for it III the market.
&. j z.