The Mankato free press. [volume] (Mankato, Blue Earth County, Minn.) 1879-1924, 1922-11-03


the intehest being represented by
negotiable coupons are readily cash
at any bank and collected in the due
course of banking. An interest cou-
pom on state or municipal bond is
almost equivalent to cash for any
purpose.
1T is not strange that the life in
surance companies, whose reserves
were formerly in farm mortgages
exclusively, now buy municipal.
state and United State bonds-tax
free, convenient, instantly market
able, as liquid as cash With the
sources OF farm credit drying up,
the farmer is being reduced to a
situation where he must either:
First: Pay of his mort
cages. which is impossible.
Second: Renew them, which
is becoming increasingly diff
cult.
Third: Place his own credit
requirements on the tax exempt
government basis, by borrowing
from the state funds which the
state in turn has borrowed on its
own securities.
1T is becoming apparent that if
the FARMER cannot have at his com
| mand some such means as the Rural
Credits, Amendment contempiates,
he eventually will either lose his
farm or pay for his credit a rate
much higher than he should pay!
considering the stability OF the Sc
curity he has to offer.
Government bonds can be sold
at a lower rate of interest than can
any other form OF credit IL the gov
q ~ ~ hot fvz
dustry, which is more essential to its
existence and the existence OF the
state than any other, and which
more than any other has been men
aced by the recent contraction of
credits and depression of prices,
why should it not place its own Dor
rowing power at the service of agri-
culture especially when it can do so
without the risk of losing cent?
Loans BY South Dakota
The state of South Dakota has
loaned $38,000,000 to $500 farmers
during the last five years, under a
system identical with that contem-
plated by Amendment No. 1. Its
credit has not been impaired there
by. Its farmers have been getting
than would have prevailed If the
system, and they have placed their
farm loans on an amortization basis,
paying the principal off at rate of
one percent year.
The South Dakota farmer, at the
end of thirty odd years will have a
farm free from incumbrance; the
Minnesota farmer, without a rural
credits system based on the amori-
cation plan, viii at the end of the
same thirty odd years have nothing
to show for his effort except a larg-
er pile of interest receipts.
But, some argue, we have Fed
eral Land bank system; they ask,
why duplicate the machinery of the
| federal government?
: Failure of Land Bank System
Because the Federal Land bank
system has failed utterly TO take care
country, and will continue to fall,
unless it is prodded into greater
activity than has been manifested
| in the past, by an Overwhelming
and continuously aroused public
sentiment.
THE Federal Land Banks have
placed arbitrary limitations on the
number of applications they would
receive from each local association;
they have placed impediments in
the way of forming new local assoc
iations. They have neglected to
maintain a clerical force adequate
to care promptly for the business
offered. They have been guilty Of
inexcusable delays-from three to
six months-in completing loans.
They have pleaded lack of funds as
an excuse for refusing loans, and at
81 a 80
bonds to investors who demand
them. The Federal Land Banks are
organized on the foreign, un- Ameri-
can plan which requires the forma-
ton of associations, plan unadapt
able to and distasteful to, the Amer
ican farmer, who is first of all an
individualist and VINO refuses to un-
derwrite the obligations of his neigh
bors, and who would rather go with
out relief than get it by entangling
his own affairs with those OF his
neighbors ~
1.-The farmers Of Minnesota want
a state rural credits system. They
refuse to pay unconscionable profits
to loan agents; they do not propose
to be deprived of credit facilities
because of the enlarging issues of
tax exempt securities: they want
lower interest rates; they want the
amortization privilege; they don't
want to be hampered by the red tape
the delays, the inadequacies, the en-
tangling complications which have
characterized the activities of the
Federal Land Banks. ...
They want the simple, direct
workable, economical South Dakota
plan adopted in Minnesota; and to
that end they ask the city voters
of Minnesota to vote with them in
favor of the adoption of Amendment
~ !" ...a.-.