Albuquerque morning journal., 1922-12-31
TREASURY BACKS
CAPPER BILL To
ASSIST FARME RS
Secretary Mellon Comes Out
in Support of the Kan
sans Measure, With MI
nor Notifications

Washington, Dec. S0--The en-
dorsement and support OF the
treasury department was given TO-.
day to the capper agricultural
cl edits bill as against its principal
rival, the Anderson-Lenroot cred
its measure, which recently was
introduced into the senate and
house with the backing Of secre-
tary of Agriculture Wallace and
other government officials.
Secretary Mellon in testimony
presented at closing hearings to-
day of the senate banking COM
mittee on farm credits legislation
and in q letter sent to Senator Nc
Lean of Connecticut, the commit
tee chairman, came out IN sup
port of tho Capper bill, with min
or notifications and with an
amendment to extend for nine
months after next. June 30 the
farm loan powers OF the war fin
ance corporation.
Support was given the Ander-
SON -Lenroot bill, on the other
hand, by Secretaries Wallace and
Hoover, also appearing before the
committee behind closed doors.
Secretary Wallace was understood
to have urged the committee 70
report the Anderson-Lenroot bill
on the ground that 1t was more
nearly adequate TO the needs Of
the farmer than the Capper bill.
Mr.. Hoover, whose testimony was
said to have related more gener-
ally to the need of agricultural
credits than to details of its eX-
tension, appeared to favor the An
derson-Lenroot measure, which
would set up farm credits depart
ments In the existing federal land
banks with an authorized govern
ment-furnished capitalization oil
s6O,O0O,000 for the IL banks.
To Draft Legislation
With the views of the three cab
met members before 1t, the COM
mittee prepared to draft legisla-
tion which will harmonic the
widely conflicting opinions held by
its members and by members OF
congress generally as to the form
Of aid to be extended the farmers
and livestock growers OF the
country.
The Capper bill which was
drafter with the assistance OF Dir.
ector Meyer OF the war finance
corporation, and presented with
the endorsement of the American
Livestock association, would pro-
vide for organization under super
vision of the comptroller OF the
currency, Of private credit and dis
count corporations with a mini
mum capitalization OF S25o,O0O
for extension Of the period dur.
ing which agricultural paper shall
be eligible for re-disccunt from SIN
to nine months, and for acceptance
by federal reserve banks OF paper
of cooperative associations OF ag-
rIculturalists sor re-discopnt as
agricultural paper.
Secretary Mellon in his letter
and also in his testimony presented
number 81 objections TO the
Anderson -Lenroot bill, declaring
that 'It would place tho govern
ment to large extent in the
commercial banking business,
would make heavy drafts upon the
treasury for the capital of the
farm credits departments and
would mean either more govern
ment borrowing or higher taxes
on all the people and would pro-
vide for issuance Of taX-exemption
collateral trust bonds to raise ad-
ditionai necessary funds. Ampll-
flying his last objection, Mr. Mel
ion said at would come with par
ticularly bad grace. for the red
eral government to authorize ore
alton of d large volume OF new
tax exempt securities" OF the time
1t was seeking to shut OF the
flow of such securities through
amendment Of the federal consti-
tuition.
Diversity of Opinion
Pointing to the diversity OF opin-
ion on the Anderson-Lenroot Dill,
Mr.. Mellon In his letter added:
an view of the substantial OBJ
tections to the bill already pointed
out, l believe that the most help
that can be pursued now Is TO
adopt a substitute measure along
the lines of the Capper bill, with
the suggested extension of the life
Of the war finance corporation un-
til March 81, 1924. This would
adapt our present banking System
to the needs of agriculture and
include the best features OF the
various rlans upon which there, IS
virtual agreement
Il would admit TO discount on
the federal reserve banks agricul-
turaI paper with a maturity up to
nine months, secured by commod-
tiles in process of orderly market
ing or by livestock which is being
fattened for market. To this there
can be no substantial objection. II
is safe, and the testimony before
your committee shows that It will
be helpful..... A rural credits
program like that embodied, in
substance in the Capper bill,
would draw capital and credit
from available sources for use
where needed by the agricultural
and livestock industries and would
accomplish this on a business bas-
is, without depending on govern
ment money or tax exemptions. At
the same time It would enlarge the
facilities of the federal reserve
system. to provide further for ag-
ricultural discounts and I hope SO
as to encourage larger member
ship among eligible banks in the
agricultural districts and would
extend up to $4,000 the limit on
loans by federal land banks. AL
together. it presents a comprehen-
sive plan of permanent relief on
practical lines"
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