The Washington herald., 1914-01-30

BILLS ESTABLISH
FARMLANDBANKS
House and Senate Measures
introduced Provide for
National System.
VIEWS NOT UNANIMOUS
Proposed Legislation Is Tentative
Form Of Administration Rural e
Credit Policy.
VIEWS NOT UNANIMOUS

There were introduced in the SenatI
and House yesterday by Senator Fletcher
or Florida, and Representative Moss, o
Indiana, respectively, duplicate bills pro
viding for the establishment Of nationa
farm land bank system. These measures
are tentatively the administration billi
for the establishment of a national rural
credit system They represent the result
OF the labors Of a United States COM
mission appointed by President Wilson
last April to investigate the rural. credit
systems In European countries and re-
port thereupon.
The bills in the forms introduced yes
terday lack the unqualified Endorsement
of the membership of the House Baaking
and Currency Committee. They repre-
sent in the main the views of the COM
mfttee and have, so far as the general
principle expressed therein Is concerned,
the appreciation of President Wilson.
President Wilson has been positive upon
one point with regard to a rural credit
system for the United States. He is op-
posed to any scheme by which the United
. States government should become direct
~ the creditor of the farmer. This view
is in entire accord with the views of the
majority members of the House Commit
tee on Banking and Currency.
On the other hand, there Is a strong
sentiment in the House Committee in
favor of further investigation of Amer
lean agricultural conditions. either at
first hand or through the medium of the
Agricultural Department and the Census
Bureau. through which legislation may
he drafted along American lines. 1t Is
feared by some of the members of the
House committee that the bills as in
troduced yesterday express to too great
an extent the result of their European
modelings.
Provides for Establishnent.
The bill. as introduced yesterday. pro-
vides for the creation, operation and
supervision of a national farm land bank
system, through which the farm land
banks to be established under the terms
of the act or to be created through the
liberalization of existing State farm
mortgage concerns and farmers banks,
shall become the new rural credit system
of the United States.
The bill provides for the creation Of a
bureau of the Treasury Department in
charge of commissioner who will be
appointed for a five-year term. 1t pro-
Vides that this bureau shall prepare and
keep for the use of the public amorti-
ton tables framed to show the rate per
centum per annum for the amortization
of mortgage loans and deed Of trust
notes for periods of from six to thirty |
five years.
1t provides that two classes of banks |
may be organized as national farmland |
banks. The first class will be regular |
tanks of not less than $4,000 capitaliza- /
tion, of which. no person shall hold more |
than 10 per cent of the capital stock, and |
of which the par yalue per share shall |
be 800. The second class of banks shall 1
be known as national farmland cooper
ative banks In these. shares may be is /
sued at s25 each. /
Under the terms of the projected law
the dividends from these banks may be |
set by the boards of directors based /
primarily, of course. upon the earnings |
nj the bank. 1t is, however. provided /
that the dividend rate shall not exceed |
the legal rate of interest of the State
in which the bank is established. The
surplus OF earnings of the farmland !,
banks must, under the terms of the law,
be paid back to the patrons of those in
stitutions
The power of these banks to make for
eign loans upon first lien mortgages or
first deeds of trust may be for either
ong or short terms, but provision is in