Belding banner. (Belding, Mich.) 1889-1918, 1916-08-30
RURAL CREDITS
LAW WILL BENEFIT
ALL GOOD FARMERS
WORKING PLAN OF NEW LAW
AS 1T WILL BECOME Eff
FECTIVE JAN. /, 1916

After years of agitation or of "de-
layed JUSTICE" as President Wilson
!. pat it, the farmers of this country
are to have a chance to borrow money,
On their farms as security, at low
rates Of interest and with the priv
iiege of long time for repayment.
Farmers hitherto have been the VIC
TINS of the money sharks" to a
greater extent than any other class.
OF total of over % billions of dol
iars of loan and investments by
American banks, the farmers have
had only about 10 per cent. The
farmers got three-fourths OF their
loans from broker sand professional
cxtortionate interest rates and also
levied heavy rake-offs in their guise
81 commissions, etc.
Altogether, it is figured, the farm
cws have paid between eight and nine
Per cent on their loans, or double
what the farmers of Europe have to
pay. How could our farmers COM
pete with the farmers of the Old
World under such unfavorable condi-
lions?
Americans are prone to think of the
United States as being extremely
&progressive, but as a matter of fact
We are singularly backward about
many things. The rest of the world
had the parcel-post half a century
before we did, and it has taken a pro-
ionged fight to secure a rural credits
law, notwithstanding all the political
parties have declared themselves for
it In their Platforms,
Of course there are always inter-
ested persons who oppose such re-
form legislation. Many men who are
connected with banks and loan in
stitutions have frowned on the pro-
posed farm-loan project. Naturally
they are afraid that it may take some
of their business away. Some fear
that it may operate to injure credit
and initiate interest rates, by intro
ducing a "fiat" element into loans.
But in perfecting the measure which
recently passed congress and became
n law every effort was made to meet
the objections, and the act is we'll
provided with safeguards.
Many farmers criticize the law be-
cause it provides for loaning money
only to farmers who already have
good security in the shape of farms
that they own. 1t is argued that the
very people who need loans most are
hose who have little or no visible
assets, and that those who already
own farms are not the ones who
should have been helped.
There was lingering idea in some
sections of the country that all that
was necessary was for the govern
nent to print up money in unlimited
quantities and loan this out to any,
body who wanted it. But this scheme
Il making printing press money"
was turned down by congress.
1t must be remembered that
money is a representative of value,
and that that value cannot be Great
ed out of nothing. Credit is simply
the ability to use somebody else's
money, and before borrower can use
another's money he has to secure the
consent of the lender. The lender
has to be satisfied that the borrower
will not squander the money and be
Unable to pay the interest when due.
Borrowers who have doubtful Gre
dit always have to pay extra high
rates of interest. for the simple rea-
son that the risk is greater and the
people who have money will not lend
IL out at low rate in such cases.
Wherever the plan has been tried or
striking off "fiat" money and lending
Il to the people, utter failure has re-
suited Hence it was that it was de-