The farmer and mechanic. [volume] (Raleigh, N.C.) 18??-19??, 1914-05-05

farmer and TO the necessity OF &C
ton. Ambassador Myron L. Herrick
is really the father of the present
rural-credit agitation He interested
President Taft, and this started an
stimulus, which was inner
tied by Mr.. Wilson. Through the IN
fuence of Senator Duncan tletcner'
and with the help Of the Southern
Commercial Congress, an American
commission went abroad last year 10
mite report.
Now the interesting thing about
this commission. as we'll as the many
individuals who have gone on SINH
lar Investigations, is that they dis
play great enthusiasm over the varl-
Gus credit agencies at work and man
ifest much surprise over the results
Of cooperation. They write long and
learned reports extolling these CO.
operative activities and lamenting
their absence in this country.
But all Of them are not familiar
with the economic systems Of their
own land. An incident which was
brought to the notice OF the Congress
sional Rural Credit Committee will
illustrate. A resident Of Columbus,
Ohio, went to Europe to study rural
credits. On his return he wrote an
elaborate pamphlet praising the beau
ties of certain foreign loans, and say
ing how much it was to be regretted
that they had never been attempted
in America. Yet within two blocks
Of his house lived the president of a
building and loan association that had
more than 81, 900, 900 out in farm
loans on the exact plan that was be-
ing held up as a model.
AS a matter Of fact, We have no
lack Of cooperative agencies in the
United States. The only trouble has
1nnn fhof thov ora no liplxa1 With
rural lending. Take, for example, the
building and loan association. When
operating under adequate statutory
! protection, it is an almost ideal CO.
operative structure.
Best Of all cooperative agencies is
the Credit Union, already authorized
by legislative action in New York,
Massachusetts, Texas. and Wisconsin.
Thus there is no lack of available
agency; what we need is the law to
~galvanize it into a bulwark for the
farmers financial needs.
The only remaining question Their
is: What shall hat law be?
In selecting a type Of institution to
handle American rural credits a pro
position more difficult than is present
ed in Europe is encountered, for the
reason that u territory is so vast
and there is such diversity of climate
products, people, and methods Of
farming. Such an institution, OF
rather one wing Of it, needs co-opera-
tive effort, and u people have only
scratched the surface of cooperation
At this writing the Congressional
subcommittee charged with the in.
vestigation Of rural credits has jus
concluded it's hearings, and set abou
sitting the flock Of bills submitted To-
the establishment Of some definite
and permanent system. A brief diges
of the most important will show wha
our legislators ave in mind.
The so-called Fletcher-Moss Bill
represents the sentiment Of the Am
erican commission that went to Eu
rope last year. 1t is what might b
. called a near cooperative scheme. Il
a word, it authorizes the formation
Of land banks all over the country
? Any ten or more men with a mini
: mum capital Of $40 900 can start on
= of these banks. lend money on mort
cages, and then issue debenture
against these liens not to exceed fit
. teen times the capital stock and sur
plus or the face value Of the under
: lying mortgages. These institution
are to be called National Farm Ian
q Banks, and when conducted under &C
; operative auspices must include tn
word "Co-operative'' in. the title. Tn
loans made by the land banks ma
be amortized, and the rate of inter
est shall not be more than / per Ger
higher than the face interest rate {
the debentures issued. This bill 70
lows the Credit Foncier idea closel,
with the exception hat the propose
IS American banks are also authorize
j, to do a commercial banking bushes
,e The objection to this measure, mad
RS in various expert quarters, is that tt
d small land banks would find it diff
t. cult to market their debentures; tn:
a the multiplicity of them would crea1
a. confusion and that the small capit;
- required would induce unscrupulo,
people to form them for land explo
OF tatiOn.
- The next most important measu1
- the Bathrick Bili-calls for Cover,
;" ment loans direct to the farmer md,
the supervision OF a Farm Cred
Board. The funds for these loa1
In are to be derived from the Issue
- United State s IL Der cent ho,d