The Redwood gazette. [volume] (Redwood Falls, Minn.) 1873-1940, 1922-08-16

Continued from First Page)
time to discuss the details Of all this
legislation, but wish to review few
matters which think have been OF
vital interest to agriculture.
FARM CREDITS
One of the prime necessities of the
farmer is cheaper credits. The fact
that his business is small as compared
with the whole, makes it more diff
cult for him to readily obtain CHEAP
credits to carry on his business, anc
the great banking machinery which We
have adopted, and the Federal Re
serve System, were not adequate te
take care Of rural credits. Therefore
the President recommended an agrl
cultural conference, which was hele
last winter, and A Joint Agricultural
Committee of the two Houses made
an inquiry and reported in favor OF q
rural credit system for personal cred.
it's to farmers. We have also passed
LEGISLATION to increase the amount Of
money which the Federal Farm Loan
Banks might loan to farmers on real
estate throughout the country.
When President Harding came into
office the Federal Farm Loan Banks
were practically at a standstill Tor
want of funds, We appropriated $780,
100000 to be deposited in the Farm
Loan Banks, and we provided that
these banks might sell their bonds
at 51a percent without increasing the
rate of interest to be charged to the
farmer, and, in fact, the Government
can now sell these bonds at much less
than 51a percent, and is doing so.
While, of course, every individual far
mer has not had the benefit Of this
law, it has greatly relieved the money
market for farm loans, and can say
from personal knowledge that the
Farm Loan Banks are now loaning to
the fullest capacity of their organiza-
ton, and if they continue to operate
at their present rate Of speed, they
will, in the course of another five
years, have absorbed practically all
of the farm loans that are eligible, or
about two and one-half billions Of dol
lars of loans in this country. 1t has
had the effect also of greatly reduc-
ing the rate Of interest which other
associations and individuals are charg-
ing farmers for loans. In Minnesota
alone, since the Farm Loan Bank re-
sumed business in June, 1921, 7,179,-
700 has been loaned, and So, 597 ,450 by
the Joint Stock Land Bank.
One further law is necessary, and
that is to create branch of this Farm
Loan Bank in the nature Of a reserve
bank, to take care Of short cred
it's for farmers, in the same way as the
Federal Reserve Bank is taking care
of short-term credits for all other
banks. This is now pending and be-
ing considered by the Congress.
WAR FINANCE CORPORATION
You will remember that in the sum-
mer and fall of 1921, the market for
farm products was so bad and the
prices so low that it was impossible
for the farmers to obtain even the
cost of producing them, that the banks
in the farming districts were loaded
up with farm paper which could not
be paid, and a national disaster was
threatened if conditions were not i'm
proved. The President appealed to
Congress for immediate temporary re-
lief, in order, first to furnish for
eign market for our surplus, and, sec
ond, to carry the farm products until
they could be orderly and regularly
exported. The bad financial condition
of European countries, and the lnabil-
ity of our farmers and local banks and
exporters to carry the products, made
it necessary that the Government come
to their relief in this great emergency.
/ do not believe, as principle, in the
Government doing the business of the
country. I think the people are turn
ing too much to the Government every
time their business is not good, hop
ing for legislation to pull them out of
the hole. But this was an exceptional
condition following the war, affecting
the great agricultural interests of the
country. The President appealed to
CONGRESS-.
r I introduced in the Senate and there
was passed and enacted into law what
is known as an amendment to the War
Finance Corporation Act. The War FL
nance Corporation had been created
during the war to finance export pro-
ducts of this country, and it had ceased
business under the order of President
Wilson and was closing up it's activi-
ties.
The bill which I introduced and
which became law extended the life
of the Corporation for one year, which
has since been made two years, and
provides, in substance, that in order
to create market for the sale of farm
products and to carry such products
until they can be sold, and to provide
adequate banking facilities, the War
Finance Corporation is empowered to
make advances not exceeding one year
and to renew such advances not ex-
ceeding three years, these advances
to be made to any person engaged in
dealing in or marketing any such pro-
ducts, or to any association of far
mers or producers, for the purpose of
assisting such persons or associations
to carry such products until they could
be exported or sold in an orderly man.
ner.
Advances were authorized also to
banks and bankers who had made ad-
vances to the farmers, in order to en-
able the local banks to carry the far
mers until their paper could be paid
No bank was authorized to charge
So of VIII hot