Custer weekly chronicle. [volume] (Custer City, S.D.) 1890-1931, 1916-10-21
STATE RURAL CREDIT VS..
FEDERAL RURAL CREDIT

The democrats are pointing with
pride to the rural credit law Just snac-
ted by Congress and holding out high
hopes TO the farmers of cheap money
put the facts do not seem TO warrant
their claims 1t is liable TO fan as
nat as did the postal savings bank
because the law is the result OF com
promise and there are jokers in it
Whlch VIII prevent its successful
operations.
Two claims are made for the law:
FIRST, that II was the best law which
could be passed without offending the
eastern interests, which is probably
true.
Second. that it will secure so,ne ad-
dittonal democratic votes, which may
also be true.
when the hearing was held AT Sioux
FAILS recently with view TO de-
termining the location OF one of these
branches, the farmers present asked
some very embarrassing questions.
They were informed that six per cent
interest was contemplated with some
slight hope that they might eventually
farmers replied that they could now
borrow money as cheap without going
through all the government red tape
II you, MI Farmer want to secure
loan under the proposed federal
rural credit plan, you would have TO
get nine other farmers 10 sign your
note and guarantee your payment
They must also mortgage their farms
for about thirty years to secure your
loan. or course, the plan is that
these ten form an association and
rsciproeate, but under the provision
OF the law II requires unanimous ac-
uon and any one man can ballS after
wards when the next mans turn has
been reached. Is 1t likely that many
American farmers are willing to have
their property tied up in such a way
II YOU secure loan Of $1,000. 90.
five. per cent Of it, ($5O.O .OO) is with
held and you are compelled to invest
this $4,000 in stock in the branch bank
me best thing that can be said for the
farmer whether he wants to make anV
use OF this system or not
one outstanding feature OF the law
! mat there are number of office
holders appointed to manage IL, at
100000 year Then there is a
provision for federal inspectors who
VIII travel at your expense to ex-
national administration to take care
OF some more deserving democrats. .
STATE SYSTEM.
The matter Of rural credits would
nave a discouraging outlook for the
south Dakota farmer were il not for
ahe Lact that relief is promised from
can state administration have al the
suggestion of members OF the Equity
league, submitted an amendment ia
the state constitution providing for
a state system of rural credits This
10 the amendment which the repubIican \
candidate for governor, Peter Norbeck,
not only in getting IL through the
legislature, but has conducted a state
wide hight for IL in the present cam
balghi ana you VIII also remember
that II was one OF the subjects under
controversy in the Norbeck- Richards
debate Ia the last primary campaign
The state plan proposed is the same
as has been In operation In New Zea.
land for quarter Of "A century nv
pertence has shown that the actua'
cost OF handling the loans includin .
losses mas been less than one-half ol
one per cent. 1t is similar TO the MIS- =
that has been in force In Australia 10,
over 20 years and has more recentIS
been, adopted by British Columbia. I,
provides for the state using its credit
for the benefit of the farmers in "a,
matter of securing farm loans Tbat
Is, the state will issue it's own Ions
time oonds which can probably be-
sold at three to four per cent witt
the understanding and agreement thai
the money is secured for the purposs
OF ioaning to the farmers and tn,
trust as security the state guarantees.
ing their payment The money wiz
be loaned on system similar TO thai
money is now loaned. and this state
In Its twenty-five years of experienc,
In loaning this money from the school
fund has never lost a dollar
The leading bankers of this STATE
are endorsing the plan for they have
not SUFFICIENT money to make these
loans themselves, and many OF tharr
feel that IL will not only be for ths
general welfare, but also add TO the
prosperity OF the banks IL the farrIn >
communities are more prosperous =
Money secured in this way could be
loaned on long terms-say twenty-fiv,
or thirty years under the Amortization
plan. That is, small payment on the
principal to be made each year until
the loan is wiped out Farmers favor
ing this plan should vote for consti-
tutionsI amendment number foar on
next election day.--Redfeld Press.