The daily Gate City and constitution-Democrat. (Keokuk, Iowa) 1916-1922, 1916-07-21
RURAL CREDITS OPERATION.

RURAL CREDITS OPERATION.
The New York World assumes that the pass
ING to the statute books Of the rural credits bill
through the signature of President Wilson IS
"a great democratic achievement that paper
evidently failing, either through ignorance or
intent to recall that rural credits legislation was
advocated by Mr. Taft during his administra-
ton and that the bill recently passed became a
law with the approval Of both parties in con-
gross.
The rural credits law means much to the
farmer Under the system now provided for 1t
will be possible for owners Of farming land to
borrow money on long time and at living rates
Of interest Government is behind the plan, but
only to the extent Of making it stable and COM
prehensive By cooperation on the part OF
landowners and judicious management on the
part of government, it will never again be nee
essary for those who have the best of all securi-
ties to pay usurious rates of interest or, to be
subject at the will of creditor to sheriff's
sale.
Nearly forty per cent of the farms of the
United States are operated by tenants. One
third of the farms operated by their owners are
mortgaged Including commissions, it is esti-
mated that American farmers are paying eight
and one half per cent. on their loans, which IS
about twice the rate paid by farmers In Ger
many, France and other European countries
where land banks have long existed.
Here is what farmer who needs money can
do under the rural credits law:
First. he must join what is to be known as a
national farm loan association, paying in So for
one of it's shares for each $1OO he wishes to bor
row. He has one vote share, but not to ex-
coed ten votes in all.
Next, he applies to the association for the
loan, giving his personal note therefor, secured
bv a first mortgage on his farm. If the associa
ton approves the loan, it turns the note and
mortgage over to a land bank. The bank sends
the amount Of the loan to the association, which
hands the money to the farmer. No commission,
brokerage or rake-off is charged the borrower.
No single loan is to be for less than 500 or
more than $4,000; nor for less than five years
or more than forty years. The loan must not
/, exceed 60 per cent, and preferably should not
90 beyond so per cent. of the market value Of
the land covered by the mortgage.
The borrower pays, semi-annually, the inter
est on his note plus an installment Of the prlnci
Ipal. He must not be charged over per cent.
interest.
Each national farm loan association must
have at least ten members, and it cannot begin
business with less than $4,000 in loans applied
| for.
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officer. committeeman or member to accept any
commission, fee or perquisite of any kind for
granting any loan. The only paid officer is a
observation-disclosures.
Money can be borrowed by this system in or
der to pay for agricultural land, equipment,
fertilizers, live stock, buildings and improve
4 ment. or to discharge prior mortgage.
I The land bank may charge. the borrowing
farmer only l per cent. more than the rate it
gets on it's bonds. This margin of one point is
to cover expenses and profits.
! The war department has acted wisely in dis
regarding the politicians and sustaining the
action of Major General Leonard Wood in or
dering two officers of New York infantry
regiment mustered out Of the federal service on
account of physical disability. Keep politics
! out of the army.
| The need for cleaning the city which the cpl
demic of infantile paralysis has stimulated in
New York has already resulted in crop of 612
fines for sanitary offenses. This is a striking