The circle banner. [volume] (Circle, Mont.) 1914-1939, 1920-01-16
FARMERS TO own
BIG LAND BANKS
George W. Wiokersham Tells
How Federal Institutions
win Be Taken Over.
TO BUY GOVERNMENT STOCK

Eventually the Borrowers viii AZ
quIre Complete Ownership Of Banks
Established Under Federal
Farm Loan Act.
That the federal land banks and tn,
Joint stock land banks are importan
supplements to the national bank sys
TEN and the federal reserve system wal
emphasized by former Attorney Gen
eral George w. Wickersham in the fed
eral court at Kansas City, where he
appeared with Charles e. Hughes and
w. G. McAdoo to defend the constitu-
tionality Of the farm loan act.
Mr.. Wickersham, who with Mr.. Nc
Adoo. appeared as attorneys for the
joint stock land banks. made very
clear the exact service which the fed
eral land banks perform and their
exact relation to the financial system
OF the country. He also made clear in
what respects the joint stock land
banks differ from the federal land
banks.
Protecting Small Borrowers Rights.
Both types of banks federal and
joint stock) were created by the gov
eminent to provide aid for the agricul-
tural interests of the country. Mr..
Wickersham said that the government
with wisdom and singular comprehen-
sion, had reached out to take care Of
every element of borrowers. Therefore
the federal land banks were created to
provide credit for small borrowers, and
the Joint stock land banks were ere
ated to provide a similar agency
through which the larger borrowers
among farmers might secure ample
funds, without having to rely upon the
funds which had been assembled for
the use Of the small borrowers, and
without danger OF depriving the Small
borrower Of the very money which had
been assembled for his particular use.
He pointed out how In the case Of
the establishment Of federal land
banks the government had subscribed
to the stock of these banks as tenn
porary aid to the particular class of
borrowers it was intended these banks
should accommodate. But, he said,
this was only a temporary aid and that
the government had provided that the
stock which had been subscribed by
the government should be taken up
the end, In very short time, the small
borrowers will own their own banks,
that is, that the federal land banks
Will be privately owned In the end
sven as the joint stock land banks are
now privately owned. ;,
Federal Banks for Associations
"The federal land banks do not lend
o individuals" said Mr.. Wickersham,
they lend to organizations Of borrow
RS, who together must desire at least |
10000 and who must organize them
lelves into a farm loan association,
md they must subscribe to per cent
# the amount Of the loan which they
eek, in the stock Of the federal land
'ank, as condition to securing the
Dan.
Provision is made that when these
'anks are set up, If within limited
ime subscriptions are not made to the
nent, through the treasury depart
nent, shall take up the minimum
mount Of stock with which they are
uthorized to start business, tO-wit,
100000. Then. a. they proceed In
heir operation, as they loan to these
ssociations and as these associations
to their stock, by and by, by
he operations Of the system, the stock
,hich the government has taken is re-
red, and ultimately those banks come
ito the control of their stockholders.
Farmers to Own Banks.
1.-THE federal government. as stock
older, will pass out, and II the sys-
I'm be successful, after a-~certain
myth o. ume,Athe land banks will be
wned by the various loan associations
hich are borrowing through the land
anks, and they will 90 ahead on the
npetus Of private ownership.
Having thus provided a system
hereby this great scheme shall be
unched and become at once opera
We and money shall become avail
de to the farmers desiring 1t, the act
80. provides that there be created 4
fferent class Of banks. namely, the |
int stock land banks. ii
Following the analogy Of the ma {
onal banks, the act provides that I
ON the outset, those banks shall be I
ganized by private individuals. The {
ock shall be subscribed BY private {
and when 100000 Is q
described, then the bank may begin
J operations 9
Joint Stock eanks Controlled.
"Since the enactment of the law. n I
ssuch banks have been organized In
6erent parts Of the country, and they
9 set forth In the petition, and their =
gregatc capital IL something more
an 100000.
Nov despite the fact that those
nks are privately owned, from the
ginning Of their operations, they and 9
cir operations are subjected to con- =