Atlanta tri-weekly journal. [volume] (Atlanta, Ga.) 1920-19??, 1921-03-03
Courts Decision
On Farm Banks
To Aid Farmers

NO recent development Is Ca IC u
lated so much to relieve the financial
situation throughout the country, and
especially in the south, as the de-
cision of the United States supreme
court Monday sustained the consti-
tutionality OF the federal farm loan
act
1t will enable the federal farm land
banks throughout the country, OF
which one is at Columbia, S. c., to
resume operations Immediately, and
their functions and facilities will, 1t
Is confidently believed, bring results
that viii be reflected in every field
OF industry commercial and aSricul-
tural activities.
Nothing has happened since the
period of depression began that Will
operate so abundantly to improve IL
nancial conditions as the resumption
Of the activities of the federal farm
land banks" declared Andrew j.
Flemming. secretary of the Georgia
Farmers union, Tuesday morning.
II expect to see farm loan assocla-
lions by the hundreds organized
throughout the south within the next
few months, and as these organlza-
tions are perfected millions of dol
lars will be placed in circulation
money that will enable the farmers
to liouidate their debts and face the
future with the knowledge that 1t is
full Of promise"
Mr.. Flemming added that Monday
night he was informed of an assocla-
ton that is to be formed immediate
ly in Hancock county, and he knows
Indirectly of hundreds of others that
will come into existence Immediately,
As Mr.. Flemming explained, the
provisions of the federal farm loan
act require that ten or more farmers
organize an association in order TO
nartiripate in the benefits of the
farm loans from the land banks.
Borrow On Land.
Local farm loan associations thus
orpanized in accordance with the pro-
visions of the law enable the joint
members to borrow on their lana
not less than $4,000 at rates OF IN
terest that heretofore have never
run as high as 6 per cent per an
mum. The law provides, further, Tor
the authorization of these loans over
a long term of years, so that the
repayment is made in such small
sums as to make it easy Tor the
farmers to make them without serl-
Gus difficulty
The money na:1ined by the banks
to advance to the farmers IN long
term loans at low rates of interest
is secured through the sale by the
hanks of farm loan bonds, which are
tax free and which heretofore have
been eagerly sought as investment
by the capital of the country. The
sale of these mortgages creates
revolving fund of millions.
The federal farm loan act was in
satisfactory operation and was work
ing wonders in assisting the farm
ers of the country when it's opera
ton was effectively suspended by
litigation that was instituted in
Kansas City. The act was attacked
as demonstrations and this operated
to estop the activities of the federal
farm loan banks, of which there are
twelve in various sections of the
country.
At the time of the suspension of
It's activities there had been or
:anized in the United States 1886
ocaI farm loan associations, which
rad borrowed from the federal land
banks exceeding $500, 100000. In the
state of Georgia, upward of 100 70
.ai associations had been organized,
out when the suspension came all of
hem had not exercised their priv
nege of credit These, it is stated,
will be revived at once, and will
avail themselves of the credit facil-
tiles Of the land bank at Columb
Used for improvements
The federal farm loan act provides
hat the money obtained on loans
rom the land banks shall be used on
nent of farm lands, but it Is the
5iew Of Mr.. Fleming and others that
:hese restrictions will not hinder the
effectiveness of the bank as an
agency in relieving general condi-
ions.
Many farmers in Georgia and
in the south" explained Mr.. Flem-
ing, ARE head-over-heels in debt to
their land as well as to supply mer-
chants and bankers. The mortgages
against their property. held by Drt-
vate interests, have made it inpos-
sible for them to liquidate other
debts.
But now that they can obtain
loans from federal land banks at low
rates Of interest and are assured that
these loans will be authorized, it will
be possible for them to liquidate
other accounts than have annoyed
them, and. in the end. it is obvious
better conditions will ensue."