The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1918-05-28
TOPEKA STATE JOURNAL
INFORM A TON
BUREAU
THE SPREAD OF THE FARM LOAN
FREDERIC ]. HASKIN, Director,
Washington. d. c.

THE SPREAD OF THE FARM LOAN
/ Washington, D. c., May 24.-There
are now as many national farm loan
associations as there are counties in
the United States. This means that
5000 associations have been chartered
by the Federal Farm Loan board
| during the first year of actual opera
| ton of the twelve Federal land banks.
1t does not, of course, mean that
| there is an association in every coun-
| ty, for not all counties are agricul-
turaL
These farm loan associations have
membership of about fifty thousand
farmers, and to these men nearly a
hundred million dollars have been
loaned by the Federal land banks.
That means. among other things,
| that in this time of food scarcity the
national government has been the
means of putting into the hands of
the farmers who produce the food
one dollar for every inhabitant of the
| nation. There is no place where the
investors dollar could do him more
good just now.
The distribution of these farm loan
associations over the map OF the
country is irregular, showing that the
credit offered by the federal LAND
banks flows where 1t is needed, act
ing as a regulator of interest rates,
and supplementing other banking Ia
cilities where they are inadequate In
such states as Ohio, Iowa, Illinois ana
southern Wisconsin. where land val
ues are high and well standardized,
and where the wealth of great cities
/ is near at hand. the farm loan asso-
Citations are few Nevertheless. the
farm loan system has not been with
out influence even in these regions OF
prosperity for there has been a de-
crease in the interest rates charged
by the esta blfshed mortsaeiHs Gun
Germs.
Ru, the federal land banks have
found their great field OF usefulness
in the south and the southwest, from
the tidewater regions of the Atlantic
to the dry-farming country OF western
Kansas and eastern New Mexico.
Turnout this region a variety OF CIT
cumstances had made it hard Tor the
farmer to obtain money Lana values
are not fixed and we'll known; agrlcul-
ture is often In an experimental and
hence temporarily uncertain stage;
large cities with the strong and per-
fected financial systems. which make
low interest rates possible, are lack
ing. As a result. the southern ana
southwestern farmer has often paid
as high as Is per cent for short-time
personal credit, while loans on land
have brought from to 3 per cent
with the additional expense of com
missions on frequent renewals. Incl
dentally. this is the region TO Wnlcn
the nation must look for considerably
increased production which it needs
a region of swamp. timber, brush and
second growth in the east, of irrigable
arid lands farther west. =
Money is necessary to multiply its
production and money is what 1t lacks.
That is why Texas has 259 farm loan
associations. and Mississippi 129. The
Ninth farm loan district, including
Colorado, Kansas, New Mexico and
among the districts. with s76 associa-
lions.
Another region where the farm loan
system has conspicuously come into its
own is the northwest, where cut-over
timber lands are waiting to be made
into farms. Thus Washington has the
second largest number of associations
among the states, with 100: while
North Dakota has 124. In the noun
tain states of the west, where mining
and cattle ranching replace small
grain agriculture. the farm loans are
in relatively little demand as yet, Ari-
IONA having but four associations and
Nevada three. These two states are
at the foot Of the list.
A farm loan may be as small as
500 and can not exceed $4,000. The
average size is $2.27o. There is now
vigorous agitation to have the limit
raised to $500 as a $10.0 loan is
too small for the purposes of many
farmers. and the limit has checked
the spread of the farm loan system
in a few of the best farming regions
in the country.
The average number of members in
farm loan association is seventeen.
The minimum allowed by law is ten.
Some of the associations have from
forty to eighty members. these large
associations usually being the result
of the consolidation of smaller ones
During the year that the farm loan
system has been in operation there
have been thirty-three cancellations of
charters, and nearly all of these are
due to such consultations to form
stronger organizations.
The future growth of the farm loan
system is an interesting subject for
speculation. Aitho in one year the
board has formed as many associa-
tons as there are counties. and has
loaned practically a hundred millions.
it is still extending its activities at a
rapid rate, and has great field before
1t. There are something over six mill
lion farms in the United States, and
of these 40 per cent are mortgaged,
which means that approximately two
and half million farmers are bor-
rowers of money. Even if the farm
loan system should continue to sup
ply fifty thousand farmers every year,
it will be many years before it has
reached the limit of it's possible extern
sion. OF course. many Of these farm
ers are in regions where other credit
facilities are as good as the federal
farm loan system has to offer. On
the other hand, in the west and south
men are daily buying and taking up
unimproved lands. and these are the
farmers to whom the federal loans are
especially valuable Many of them
could not obtain longtime credit from
any other source And these pioneers,
who are putting new lands under the
plow- are especially deserving of fed
eral aid. for an adequate food supply
in the future will depend to some ex-
tent upon them