The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-03-09
Federal Aid for the Farmer.

farmer Is all Astounding. "A certain
amount Of difficulty attaches to the
processes Of social uplift which ar" In
tended to enable people to crafty their
desire for urban life by tightening the
burden of living costs In cities without
restoring n normal balance Of popula-
ton between urban centres and the
rural districts. The solution when
seems to have been hit uTOn Is de-
scribed in the phrase rural credits"
which Is on all political tongues. The
States, including New York, are taking
the matter up and are proposing to he
stow on their farmers fresh borrowing
facilities. but Mt the moment attention
is chiefly engaged with the Federal
propaganda for the sen,e end.
1t Is assumed that Congress not only
should but will soon enact law pro-
viding for farm credit system be-
cause in other countries there are spe-
cial financial devices to enable the farm
ers to borrow money, the underlying
assumption being, In the case OF the
United States, that II the American
farmer can incur more debt than he
already owes, but at lower rates OF In
terest than he now pays, agricultural
pro,inctiyeness will be vastly stimu-
lated and living costs will come down
everywhere. Thus would the pleasures
Of gregarious urban existence be
made available without penalty In the
price Of freedom from agricultural
isolation.
BY such an outcome Of Federal phi
lanthropy. which OF course ignores the
rural vote in its project of doing some
thing for the farmer, the increase OF
urban population would be accelerated
and its dlsproportion to rural popula-
| tion emphasized. but nobody seems to
think that this would have the effect
Of requiring progressive stimulation
/ Of agricultural production in order to
keep prices down. Nor does II seem to
oncur to anybody that the farmer may
not particularly care to have his prices
kept down. The whole problem Is to
be solved by offering the farmer a
larger and more attractive opportunity
TO 20 into debt than he now enjoys.
One trouble with the propagandists
OF rural credit systems is that they
overstress the past and present cost Of
money TO the farmer and appear TO
ignore his borrowing habits. Senator
FIrTCHrR's name Is identified most
prominently with the leading pro-
gramme at Washington for putting the
farmer in pawn. Senator F1ETCHER
addressed "A joint hearing Of the House
and Senate Banking and Currency
committees recently on the subject Of
rural credits and in the course Of his
address he said that the farmers Of the
United States already owed s6,OOO.OOO.-
900, Of which one-third was secured
by farm mortgages lie reported the
interest paid as ranging from 8 to "a
per cent. a year without taking account
Of stifY commissions charged by bankers
} and loan agents.
Now the interesting point Of this Is
the pronounced tendency OF debts TO
accumulate against American farms.
The American farmer Is the grea test
borrower in the world. This Is fact
OF record which cannot be disputed
and It's impllca tons cannot be sighted
by any glib direction Of attention to the
difference between the prevailing price
Of agricultural credits here and abroad
or to the contrast between interest
rates to the American farmer and
the interest charged for accommoda
+. ton to other forms Of industry In the
/ United States. On his record 1t can
be predicted that If the American
> farmer Is supplied with fresh facili
ties for borrowing, especially at rates
of interest approximating the interest
charges in other lines Of economl,
activity, he will proceed TO pile up q
' colossal mountain OF Indebtedness.
BY all this we do not mean to say
that schemes for improving the agrl
cultural credit system are unworthy
Of consideration. Some notice should
= however, be taken OF the probable con
sequence Of enhancing the temptat ior
to an inveterate debtor to swell bill
total OF obligations There is room fo
fair argument that the farmer has no
suffered from lack OF credit accOmmO
:, dalton and that the chief rea son why h,
. is not hopelessly insolvent to-day Is be
. cause high interest charges have KEEP
: him from borrowing Ms heavily as h
:, would have liked to.
. There is another side TO the rura
credit problem than that which is de
;. noted by comparison Of interest rates
side which Is represented by com
PARSONS OF habit 1t has not been con
templated as carefully as 1t should. an,
II new rural credit systems are to b
set up they might very we'll includ
b. rigid safeguards against the thriftles
i propensity which American agricul
tural history has demonstrated.