New-York tribune., 1916-07-19
A Sign of the Times.

~
The rural credits law, which President
Wilson signed on Monday, is a sign OF tne
times. It is one sign Of the awakening IN
this country to the fact that in point OF
economical and industrial organization the
United States has yet to take It's place OH
the list of nations which have learned now
to develop and utilize their full strength.
Industrally and economically we are FAR
from being a nation in the true sense OF
nationality. We have clung blindly to the
ideas of our Colonial and parochial period.
We have let individuals, groups and IN
terests shift for themselves, have encour-
aged individualism instead of unity OF ef-
fort and have allowed industry, commerce,
transportation and agriculture to work out
their own fortunes without supervision
on the part of the government which would
have directed all effort to common ma
tional ends.
Agriculture has Jagged furthest behind
in the -you-please struggle for eco
nomic success. 1t was in the hands of
class least able to secure capital or TO
achieve results through increasing skill IN
labor and decreasing waste in operation.
The United States is one Of the foremost
agricultural countries in the world. But
il is not foremost in the utilization OF the
resources at its command in scientific agri-
culture or in the ratio of yields to the area
cultivated.
Our farmers have, on the average, pur-
sued the old, shiftless hand-to-mouth meth
DDS of the past. They have had to con-
tend with poor labor and poor credit
most of all perhaps with poor credit. The
cost of capital in the old days of the West
ern farm mortgage era was pitifully exces-
sive. Loan sharks were allowed TO make
ruinous profits at the expense of an indus
try which lay at the foundation of national
prosperity.
We have begun to realize the economic
follv of the sin against true national de-
velopment involved in such a situation. 10
give credit to the farmer is labor OF con-
structive craftsmanship, for agricultural
prosperity means prosperity for all the
other producing classes.
In the new rural credits law the govern
ment goes & certain distance toward guar
the American farmer adequate
access to capital. He has not had that IN
the past. Out of total of $21 900 ,OOOOOC
of loans and investments made by Ameri-
can banks, only about $2,250, 100000 go to
the farmers. They have also had to pay,
on the average, higher interest rate than
they could afford to carry, considering the
backward character of the farming in
dustry.
The new law aims to establish a farm
loan bank system which will absolutely
limit the interest rate on farm mortgages
to 6 per cent 1t extends the governments
aid to the Federal loan banks which take
up mortgages and selling bonds based on
them. That is as it should be. The Fed
eral government should not hesitate to
use its power to stabilize economic condl-
tions in agriculture and to natlonallze the
credit system on which agriculture must
rest.
The new system will be perfected grad
ually in practice. 1t has numerous ap-
parent defects. But its principle is thor
oughly sound. Rural credits are neces-
sary part of any modern nations internal
machinery 1t is evidence of how fast W.
are travelling toward saner national con
ceptions that less than ten years ago the
creation of national farm loan bank sys-
TEN in this country was still considered
one of the ideals of very hazy and dis
tant future.
Al