New Iberia enterprise and independent observer. (New Iberia, La.) 1902-1944, 1913-09-20
FARM MORTGAGES AND
CREDIT BANKS.

One hears much ignorant out
cry these days in favor of banks
that will lend money TO farmers.
The Impression is practically
universal hat the prosperity OF
the farmer would be greatly en-
hanoed if some plan should be
devised TO make il easier for the
farmer TO obtain money by mort
gasing his farm. There are cir
cumstanccs under which prac-
tical business farmer might profit
by cncumbering his farm with d
mortgage, but in 30 per cent o.
the eases where a farmer mort
cage. his farm for any purpose
except 10 enable him to pay for
t. qhe struggle with interest and
debt process too severe, and after
n few years the farm passes into
the ownership of the creditors.
I'm some way, the principle OF
cooperative farm credit banks
has been confused with the reg,
ular commercial banks, in the
minds Of many, and the sound
argument. advanced IN favor oi
farm credit banks have been mis-
takenly interpreted by many as
endorsements Of the plea to make
if easier to obtain money from
Ale. regular banks on farm mort
cages. There is no similarity
tween the two AS IA matter
of fact, all sound economists
have noted the danger to the
farm that grows out of ma, KING
easy to mortgage the farm,
md the best thought of the rip
est students Of political economy
has been devoted to the task o.
working out "A sounder scheme OF
farm finance.
In last week s issue Of The
Country Review Mr.. n. O. Mel
son pointed out with much clear
ness and force the harm wrought
the farm mortgage and con
trasts it with the beneficent IN
fluence exerted by people S ere
dit banks. In that article, which
ought to be read and studied by
every farmer and business man
in the South, Mr.. Nelson thus
epitomizes the subject under dis
cussiou:
"The prime motive and motive
power in the people $ banks IS to
direct the farmer s own work,
organize his selling and buying
,nd furnish the needed cash for
doing these things and no other,
and this only if his neighbors
know him to be honest and IN
1ustrious. Read this paragraph
again. and you will have in a
the whole Of the famous
Raiffeissen. peoples bank, or
.redit society
1t will be observed that the
mortgage of the farm is not con
emplated under this system-ln-
Iced, the. system was devised
With the distinct purpose in view
# removing the temptation t.
mortgage the farm by supplying
, simpler and better plan OF IL
,ansing the farm industry of the
country. AS Mr.. Nelson points
,ut. it provides a way to capita
ize the industry and honesty OF
rom 20 to 100 neighbors, who,
through the association, borrow,
lpon their joint note. a sum cal
ulated to meet the working
reeds of each farmer, and apper-
ion the money among themselves
~ their several needs.
,v borrowing through the asso-
iation, buying through it and
elling through it, better prices
.urm. and cheaper transpor-
alton rates are obtained, while
very member being personally
ound up in the success OF the
lovement. each will see that ev-
ry other member lives up to the
prms of his agreement.
Thus a members credit does
os depend, as in the ordinary
bank, upon his abil-
y to put UP gilt-edged CONNER
lal paper as collateral for his
,an; the collateral that counts IN
he farm credit associations be-
~ individual honesty and in
ustrv and the confidence of his
ssociates. With these as assets,
g will be able to borrow such
loney a he may need-not to pay
ebts, but to buy seed. fertilizer,
,rm animals, implements, etc,
, enable him to farm success
lilly.
The moral value Of this sys
I'M of cooperative farm credits,
!, valuable as the system is from
pecuniary standpoint, is more
aluable still for the good effect
produces upon the members of
le association and upon the en-