The New York herald., 1922-11-20
Farmers Loans and Taxes.

When THOMAS c. ATHEsoN told the
National Grange at its annual con-
vention that it is useless for farm
ers to look for lower taxes while they
vote new State bond issues and de-
mand more national government dis
bursements he talked common sense.
And it is a common sense which the
level headed farmer ought easily to
Grange legal representative declared
'the American farmer cannot be con-
vinced of this. as was shown in the
recent election, when farmers OF
Oklahoma and Kansas elected Gov
ernors pledged to reduce taxes and
at the same time voted to pay ex
service men a bonus"
Since every dollar that is spent
by government, whether national,
State or local, must come out of the
taxpayer, either as direct or an
indirect tax, the farmer or anybody
else hits his own pocket when he
votes for or countenances increased
public expenditures, no matter what
they go into. There is no way to
avoid some government expenditures,
OF course. just as there is no way for
the taxpayer to escape paying the
bills. But when the cost of govern
ment for whatever reason gets so
high that it bends the taxpayers
back it begins to dig great holes in
his business, because money that goes
into the tax collectors till cannot go
into the development of a, business,
whether it is q farm, a factory or
shop.
While, however, the National
Grange spokesman was as sound as
sound can be on what makes taxes,
he was not so happy in his remarks
to the farmers on their borrowing.
This is what he is quoted as saying
on that subject: "The American
farmer must get into his economic
cyclone cellar, must retrench and quit
borrowing money"
But il is as reasonable and as neces-
sary for the farmer to borrow money
from the banks to carry on his busi-
ness as It is for the manufacturer
and the merchant to borrow money
from the banks to carry on their busi-
ness. AS a matter of fact, the nature
of the farmers business makes 1t
even more necessary for him TO have
bank facilities than it is for the man
ufacturer and the merchant to have
bark facilities This is so because
the farmer cannot cash in on his
crops for a year after he starts to
raise them, while the manufacturer
and the merchant can make rela-
lively quick turnovers on their goods
after they make or buy them.
And the truth about the money re-
quired to carry on ones business is
that it costs II you borrow it at the
bank, but Il costs just the same IL you
have il piled up in a safe in cold cash.
IL must be perfectly obvious that II
farmer we're holding in his safe n
constant cash fund Of, say. $4,000 to
avoid borrowing at the bank TO carry
on his business he would be losing
the interest he could be earning on
that $4,000 IL he had IL invested in
securities or in the expansion Of his
own business.
A business loan of $4,000 at the
bank might cost the farmer at the
rate of per cent or s per cent.
year as long as It was needed
each season, but $4,000 OF his own
capital put into bigger and better
business might earn him much more
than what the bank interest on his
loan would amount to.
The American farmer. like all other
Americans, can profit by cutting out
waste and practising other wise econ
omy in the conduct of his busi-
ness and by giving it generally first