The Caucasian. (Clinton, N.C.) 188?-1913, 1913-05-15


socat!ng a system % cheap loan
credits TO farmers and farm tenants.
and said that / offered 10 plan. The
plan for system Of cheap farm cred
it's can BE- copied from any OF the
successful plans now in operation In
a dozen countries The problem here
and everywhere is how TO secure
sufficient cheap capital 10 make any
OF these plans d complete success.
The essence OF my suggestion vas
the use Of Postal Savings Bank funds
By the government. 10 supplement,
the funds that would be raised by
the farmers. TO furnish the capital
necessary for such Farm Credit
Banks. You objected TO this ready
efficient means for supplying suffl-
cient capital. declaring that the farm
eTs need no help from the govern
ment, and that all they had 10 do
was 10 rely on themselves and use
the building and loan association
plan to secure all of the money that
was needed.
All experience has shown that the
one essential thing for the success
of the Farm Loan Credit Banks is
TO be able 10 secure as much capital,
at low rate Of interest, as the land
owner and tenant needs, and for
which he can offer ample security.
The various countries Of Europe
J where the governments have aided
farmers, in supplying this capital
are countries wherein the most bene-
ficient results have been accomplish
ed. The system of cheap farm
credits in France has been more sue
cessful and beneticient than in any
other country in the world and this
! has been due entirely TO the fact
/ that the government has furnished
sufficient capital to these banks, to
supplement the capital furnished by
the farmers themselves, so that
every farmer may secure all needed
capital at a very low rate Of inter-
est.
This government is in a position
to assist its farmers by furnishing
such capital, even to larger extent
than France is doing, and can do so
without loss or risk, by using for
this purpose, the large and increas-
ing funds deposited in Postal Saw
ings Banks. This is the plan that |
proposed, and if put into operation
would solve the whole question and
would result in the Immediate estab-
lishment of Farm Loan Banks in ev-
cry agricultural community Of the
whole country.
The European systems have,
everywhere, been success to q
: greater or less degree, the degree
measured, however, by the amount
of available capital for such loans.
The building and loan plan sug-
doubt, intended to followshrdlu-ezjd
gested in your editorial was, no
doubt, intended to follow the plan
in operation in parts Of Germany
and Austria, known as the Schulze-
DelitZsch Banks. This system of CO.
: operative banks is not composed OF
farmers alone, but includes artisans
merchants, industrial workmen, pro
fessional men and persons Of indie
pendent means. The last report
= which l have before me, on these
banks shows that only 26 per cent
of the membership are farmers, anC
that only 2.41 per cent are farm la
borers or tenants These banks are
operated on the building and loar
plan of this country, and are not ruT
chiefly in the interests of the farmer
but especially in the interests Of
jewellers in towns and cities, and the
rate of interest is higher than il
the pure farm loan banks, known il
Germany and Austria as the Reiffei
sen System.
These building and loan (SchulZe
Delitzsch) banks, which are operat
ed for profit, were established iI
, Germany and Austria before the
Reiffeisen Banks, but their failure
to meet the needs of cheap farm
credits caused the establishment O.
, the latter system which makes loan!
. only to farmers and farm tenants, a
!, a low rate of interest and without
any profit to the members or stock
holders.
The farmers of those countries arr
f rapidly Withdrawing from the build
: ing and loan plan, and therefore
! the Reiffeissen System of Rura
, Banks has been rapidly growing
= These two cooperative systems o
, credits, at low rates of interest t
their members, have been adopted
with more or less changes in ever.
o country in Europe. The capital TO
these banks has been chiefly secured
= either by membership dues, or stool
: taken by the members, or by the is
sue of bonds behind which all o
q the property of the community stoo'
. as security and also the deposits
q similar to deposits in our Postal Saw
, ings Banks, by the members and cit
: liens generally. Many of these bank
! started, at first, as purely cooper
alive concerns with no government
supervision, but by degrees in nearl
every country they have been super
. vised and regulated by the respectiv
) governments. not only for the safet