The Oroville weekly gazette. [volume] (Oroville, Wash.) 1905-19??, 1913-09-05
FARM CREDITS FOR AMERICA


Homer c. Price, dean college OF
agriculture, Ohio State University,
read the following interesting paper
on improving farm credits in America
before the National Conference on
and Farm Credits at Chi
cago:
American farmers have never been
more prosperous than they are at
the present time. Prices for farm pro-
duce are high, crops are good and
farm land is constantly advancing in
value. Why then is the question of
farm finance occupying such prom
inent place in the public mind? l be-
lieve that it is because of this pros
perity that farmers are awakening to
the fact that they lack any adequate
system of financing their enterprises.
1t is the prosperous business that can
use capital to advantage and 1t is the
prosperous farmer who can afford to
borrow capital to invest in his bust
ness. But the industry of agriculture
is made up of small, Independent COM
mercial units and lacks the advantages
of combination found in other indus
tries. Particularly is this so in the
matter of credit and the individual
finds himself seriously handicapped in
the matter of financing his enterprises
as compared with large commercial
interests of the city. We have been
entirely self satisfied with our agri-
culture in the past and have revelled
in exploiting virgin soil. We have had
little time or inclination to know what
the older countries were doing. But
all of sudden we have awakened to
the fact that we do not possess all
that is worth knowing in agriculture
and that in agricultural credit, CO.
operation, distribution and farm or
ganization we are woefully behind
some of our European neighbors.
Foremost among the nations in fl
nancing their agriculture stands Ger
many. For nearly a century and a
half they have successfully conducted
their Landschaften or land mortgage
association, the oldest and l believe
the most satisfactory institution that
has been developed to furnish real
credit THAT is, credit on real estate) to
farm owners. The great advantage
of the Landschaften Is the fact that II
serves as the medium by which farm
mortgages are converted into negoti-
| able securities by means of mortgage
bonds. We recognize that there is nc
better security than arabic farm land
and no form Of property less liable
to be destroyed by act of man or God
But because of the difficulty of trans.
fering title in real estate, the delay
occasioned by the legal procedure OF
| foreclosure and the tedious process
of examining the title to ownership
land is not the most desirable security
for credit and for many kinds of in
vestment is not accepted. Through
their land mortgage associations the
German farmers are carrying at the
present time one billion dollars II
farm loans on which they are paying
on the average four per cent interest
(Pfandbriefen) their farm mortgage
securities are made as negotiable a.
government bonds and are "giltedged
securities, accepted in all circles
There is no foreign system of agricul
tural credit that we can hope to trans
plant bodily to this country any NOR
than we can hope to transplant an
other foreign institutions. Our Gus
toms, laws, traditions and condition
are different and all that we can hop
to do is to take principles and adar
them to our conditions so that W
may accomplish the same results.
we will profit from the experience
other countries and take the best o,
of their systems We should be abb
to develop a system of rural credit
America better than anything that no
exists.
Combining my remarks to rel
credit chat is, loans secured by far
lands), the things that we need to a
complish by means Of rural cred
system, as l see it, are: CD To col
vert farm mortgages into securiti
that are readily negotiable; (2)
provide longtime loans that are r
paid on the amortization plan al
which cannot be called in except f
cause; (3) to convert the farm MOI
cages into standard securities that W
be excepted for all classes of inves
ments; (D to secure rate of int
est commensurate with the securi
| given; 60 to provide that loans m
l be made and repaid with miniml
expense and loss of time on the p'
of the farmers. How Is this to
. done? That is the question that