The daily telegram. [volume] (Clarksburg, W. Va.) 1901-1926, 1914-04-18
.G0UL TER TALKS
ON THE RURAL
CREDIT SPILL
Government Expert Explains
Measure in Speech before
Farm Conference.
tsx AsseeIArEo sRasn


CHICAGO, April 1s.PIans for
| farm credits as outlined in the pro
posed law framed by a commission
on agricultural credits after a study
| of European systems and now pend-
ling in Congress under the name OF
the Fletcher and Moss bill, were
summarized today by DIR. John Lee
Coulter, chief Of the division OF agrt-
cultural research in the census bu-
reau at Washington, ID. c., speaking
before the second National Confer
ence on Marketing and Farm Cred
It's meeting here in joint session with
the western Economics Society. He
! toll of the study OF the commission
of which he was secretary, and add:
ed:
"a special bill was drafted by the
lcommission covering the problem OF
lIong-term or land-mortgage credit
This was introduced IN the Senate by
Mr.. Fletcher, of Florida, chairman
+, of the commission, and in the House
by Mr.. Moss, of Indiana, vice presl-
dent of the commission.
New Banking System.
| 1.-THE first recon mendateon OF the
commission in the bill is that farm
real estate be made the basis of
new banking system exclusively FOR
] farmers. 1t was urged that the farm
this business and operate under fed
eral charter. This IS opposed to q
system of government loans direct
! from the United States to the millions
of farmers in thu country But the
commission urged that federal
bureau of farm land banks be estaip-
Iished, to be charged with the duty
of inspection and close supervisor
over the institutions chartered. This
/ I. rn1ufEA6 the farm
LAND bank as the present comptroller
of the currency is to the national
banks, or. as the Interstate Com
merce Commission is to common
carriers There would be certainty
| from the beginning that no mtsdee is
would be allowed and exploitation
would be impossible.
Restricted Clauses.
s'These farm land banks might be
organtzed by farmers Cborrowers) or
capitalists Glen 1ers.) They wouAu
llend directly to formers and accept
mortgages, deeds Of trust, vendors
liens, etc, as evidence OF the loan,
| and in turn they would issue lana
| bank bonds in amount equal to the
mortgages held or loans made. BY
selling these bonds more money
would be AVAILABLE to lend to more
i farmers, etc.
| MANY IeSLIlCI1N6 C4dAA9SC9 w. -
such as-1) No loan shall be more
| than twenty per cent of the paid-up
/ capital stock of the bank; (2) no loan
II shall represent more than fifty per
i cent of the appraised value OF the
Il property lnortgaged in the case OF Inn
\ proved land, or forty per cent in other
Il cases; go no institution shall take
\ deposits exceeding fifty per cent OF
4 the paid-up capital stock, but snall
depend on the sale Of bonds for FUNDS
with which to make loans; az no
bank shall make loans Tor longer eI
4 period than thirty-five years; (S)
loans made for longer period than
live years must be gradually reduced
by the payment of a small instalImenI
/ each wear in addition to interest
charge: (6) the rate of interest TO
Farmers shall nnnot exceed the inter
Fest paid to bond holders by more than
one per cent; Cd no institution sna4I
make loans for a longer period than
/ five years an dissue bonds based upon
the same exceeding fifteen times the
amount of ,paid-up capital and sur
plus and (S) al institutions must &C
| cumulate reserve funds, etc.
Special Privileges.
ION the other hand, the farm. land
banks are given corresponding spec
ial privileges. For instance, the bonds
are given special favors wherever they
apepar; the United States govern
ment vii Invest postal savings funds
in them, thus showing the confidence
of the government in their stability
thustees of trust funds under federal
courts are allowed to invest in them;
they may be used as collateral with
national banks if one wishes to Dor
row; etc; all instruments held by the
bank INCLUDING bonds, MORTGAGES,
etc.) are to be exempt from taxation,
thus removing burdensome double
taxation from the farmers beck"
Other Bills
Mr.. Coulter summarized several
other bills for rural credits now be-
fore Congress and added:
'sAll or nearly all Of these recognize
most Of the same fundamental bases
as the commissions bill. Most OF
them, however, provide either for d.
rect loans from the United tSates gov
eminent to the millions of individual
farmers or variations from this; or,
on the other hand, provide for the in
corporation of one or few great cen
trail mortgage banks. The commits
sion was opposed to both OF these
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