Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1916-01-15
RURAL CREDITS
LEGISLATION WILL
HELP THE NATION
Primary Purpose Is to
Strengthen Country's Ag-
ricultural Position
MARKETS FOLLOW
Nv ALBERT N. HoGG

Assistant Cashier Sorp9 Exchange National
The primary purpose Of rural credits
,.sisJetjon Is to increase the AGRICULTURAL
strength OF the nation by deereas'ng ie,n n
sen.pcy During the decade 1900 TO 1910,
ancv Increased at the rate of is per
~ II i23 farms of 800 acres had been
sk.ndoned and the abandonment had
sosn nreceded by tenantry The country
,s waking UP to the fact that this Is an
unhealthy national condition.
In 1912 the platforms of the three great
political parties contained rural credit
planks. s..,
Already more than 100 rural credit bills
.a,,e been proposed in Congress through
..nst if not all of these. runs the vicious
feature of Government aid and class leg
islatIon.
The last bill, now in the hands OF the
,,anlsinp and Currency Committee of both
houses, is intended to take the place of
all preceding bills.
n proyIdes for the creation of a farm
,oan board of five members TO be APP
pointed by the President; the establish
r,ont Of IL regional banks, each with a
capitnl stock of $500, 5000, These banks
sviiI he allowed to issue farm loan bonds
tn the amount of 20 times their capital.
An important provision Of the bill re-
ouires that the individual borrower must
anplv for his mortgage loan through
local cooperative association, the borrow
er contributing per cent. OF the loan to
tbe capital of the local organization,
which i'm turn subscribes like amount
10 the capital of the land bank
II has been concuslvely shown that
any plan which will assist the deserv-
ing borrower who cannot command the
facilities OF the present banking sys-
tenn must necessarily oe based on local
co-operative associations. This 'a' ture
Of the proposed bill is in entire -ecord
with successful methods used abroad
GOVERNMENT CONTROL OBJECTION
The chief objection TO this measure will
arise over the Government control and
Government aid features. President viii
son himself has said that the former
should expect no special privileges, eX-
tending to him the credit of the Govern
ment
New York state has established land
bank, and a large New York trust COM
pany has purchased $4,000 of the fist
series Of the bonds issued by the bank
at ~ per cent. interest. The law Great
ing the bank coutempIates the co-ordna-
tlon Of the savings and loan associations
of the State with local cooperative asso-
Citations. But the state advances no aid
TO the former nor is it controlled, as the
Federal measure proposed, by n Govern
ment board and political appointments.
As much as the New York land bank
has been criticised II has some strong
T lures For insta o, tn" individual
borrower must have % to 80 per cent OF
the purchase irice OF tho property, while
70 to 80 pcr cent. list be provided by tho
focal savings and loan association, so
that not over 90 per cent. of the appraised
value will be provided by the issue of
bonds
Helping the farmer o0ntcmplates also
adequate facilities for personal credits |.
e. credit for current farm needs. More
than 5000 banks are doing this each year,
and were the farm mortgage property
taken care of by land banks, State or ma
ti0nal, 1t would seem that the present
banking system, with the Federal reserve
facilities for redisCount of current farm
paper. should In .rcHr moo g"re take care
OF current farm needs. With the estab
llshmCnt OF lOCa cooperative associa-
tons, the legitimate farming demands
should be fully covered in the particular
locality.
STATES FEELING WAY.
Better marketing enditons naturally
go hand l.. hand with any movement of
this kind, but this is more of local
question. The organization OF farm units
will lead to development along these
lines AS a matter of fact, many com
munties have been organized from time
10 time to improve marketing conditions.
and the results have fully justified this
method of dealing with the pro- lem.
The States are feeling their way in this
matter; so should the National Govern
ment be very careful in enaCting any
egislnt OF at tho present time. except on
conservative lines. II at all. Had not the
Federal reserve act better be tried out
ars
Has any one observed, by the way, that
those sections OF the country which could
never see any value in the establishment
OF a United States mercantile marine are
now the most ardent champions of
measures promising Government aid to
the farmer?