New Ulm review., 1922-10-25
AMENDMENT No.
VILLA T ARM MERS.
STATE CAN NEGOTIATE LOANS
IS ON REAL ESTATE BY
PROPOSED ACT.
ADOPTION FAVORED BY ALL
PARTIES. JOHNSON MAKES
STATEMENT.

STATEMENT.
All political parties have joined in
supporting Amendment No. l which
will enable the state to establish and
maintain a system Of rural credits for
the purpose of loaning money and ex-
tending credits to farmers upon real
estate security.
Minnesota farmers have for years
needed facilities which would provide
credit for capital investments at low
interest rates. The plan is to amend
the constitution SO that the state can
sell bonds at low rates Of interest to
obtain money for the farmers on first
mortgage securities. The interest
rate charged the borrower will be
enough higher than paid, to cover the
cost Of operating the system.
Farmers to Benefit.
The constitution of the State OF
Minnesota which specifically provides
that Minnesota's credit shall not be
"given or lent to any individual, asso-
citation or corporation has been an
insurm obstacle in the path
of state rural credits system such as
economists and farm leaders agree is
needed for the proper development Of
the states agricultural resources.
The Rural Credits amendment
which the voters will be asked to pass
on November Z is merely an enabling
act removing the Constitutional re-
strictions which heretofore have pre-
vented legislative action. While the
amendment paves the way for the
establishment Of the rural credits
system, and it's adoption means that
the agricultural Industry will obtain
great direct benefits, the indirect re-
suits will improve the situation of
every man and woman in the state,
according to statement made by
j. F. Reed, chairman of the Farmers
Special committee on Amendment
No. /.
Will Help City Residents.
tsPersons living in the cities and
towns will be among the first to be
aided, because once the system is in
operation, it will release vast amounts
Of capital now engaged in the farm
| mortgage business Mr.. Reed says
"This capital, seeking employment
will be available for home building
and other development work in the
cities. Moreover, with this new force
I in the financial field, the competition
it will offer will tend to stabilize and
reduce rates Indirectly on city proper
ty, exactly as it will directly in the
farm mortgage field.
Viewed from the larger and even
more vital standpoint, better long
time, credit arrangements for the
farmers will help the average citizen
Of the state because Of the sta bilizing
Influence that will be exerted on the
great vital business Of food production,
Minnesota, it should be remembered,
prospers only as its farmers prosper.
System Is Success. #
"a state rural credits system such
as can be organized, when the amend
ment has been adopted, is not an ex-
pertinent; South Dakota has a state
plan that has been in successful opera
tion for five years. It has loaned
$3s,000,O0 to $500 farmers in that
time. s3 i=
''The Federal Land Bank of St,
Paul has for its foundations a Flan
similar in many respects to that hast
which proponents Of Amendment Mol
have in mind. However, additional
machinery is needed for the reason
that thus far the federal rural credits
system has been able to handle only
10 per cent Of the farm mortgage. loans
i in the state.
European countries are far ahead p4
|; United States in the matter Of Ions
time loans to farmers. One Of the
|.most important factors in the building
Eof the German Empire was the Rura
1 Credits system by Bismark. Eng
Hands Rural Credits system serves no1
only farmers Of the Islands, but i,
4 several branches Of the Empire .,
well. !" H5.
Ballot Is Pink.
Il The Constitutional amendmen'
4 ballot which will be given to ever,
voter going to the polls November
| lis pink in color and covers two pro
/ positions, the first Of which is Amend
Il ment No. I, Rural credits. The Law
ii provides that the amend dment shall b
Il declared adopted only when It shall b
a found that q maj Of the voter
4 voting shall have registered for il
] Failure to mark rural credit ballot
~.