The Richmond palladium and sun-telegram. [volume] (Richmond, Ind.) 1907-1939, 1922-12-14
Raruch Plan Annroved

Baruch Plan Approved
Among the various proposals for
the form which the legislation should
take. one which has dependable and
authoritative backing comes from r.
NJ. Baruch. Several months ago Mr..
Baruch was asked by the Kansas
state board of agriculture and the
American farm bureau federation to
put his mind on the problems in
volyed in the financing and merchan-
dising aspects of farming.
Mr. Baruch spent much time in con-
ference with the officials of the Amer
lean farm bureau federation and with
other sources of information and 1ud9-
ment in this field. The results of his
investigation and thought we're en-
bodied by Mr.. Baruch in report
which he made before the annual con-
vention of the American farm bureau
federation at Chicago this week.
Mr.. Baruch's recommendations are
that a new financial system should be
set up to increase the volume OIL
credit fer three classes Of farm needs:
credit based on the harvested crop as
security for the purpose of the more
orderly marketing of these crops, SIM
liar credit for the purpose of raising
the purchase of machinery and fertI-
lizer to make n" crops, TINS latteI
differing from the first in the faeI
that bv the nature of the case there
is no collateral. To meet these needs
Mr. Baruch's proposed legislation
would provide warehouses in which
tbe farmer can deposit his crop.
The crop would be graded officially
..Tot or ~
other neutral authority which wouit
REGISTER the grade and amount an
issue certificate for il. This certifl
cate would be made :Ie basis of whicl
the farmer could borrow and wou!;
he enabled TO hold back his crop from
the market until sach time as h
sbould feel disposed to sell. In sim
liar way. Mr.. Barucn would set up ;
mechanism for credit to cattle raiser
on the security of their cattle proper
lv inspected, and with restrictions ap
plicab;e in the circumstances.
Mutually Endorsed Notes
When il comes to credit for thu
planting of crops, Mr.. Baruch recon
mends the organization of local asso
citation of farmers who shall mutual,
indorse each others notes. All thre
Raruch would make discountable L
the federal reserve system, so lon
as the maturity of the notes is within
nine months. The local association
he would have controlled by centra
organization under federal authority
and would allow each regional institt
tion to issue and sell its obligation
in the open market to the extent c
ten times its capital
Mr. Baruch's plan asks for financla
aid from the federal government I
the extent, and only to the extent, tha
the initial capital of the new syster
should be provided by the treasury.
To Pay Back Sum
The amount needed he estimates g
from fifty to hundred million dollar:
This initial capital provided by tn
treasury would be paid back to tn
treasury in due course out of the no
nal profits of the new institution.
This plan of Mr.. Baruch's, of whie
only the barest outlines are give
here. is the fruit of so painstaking
survey Of the situation. that it is pro-
able that whatever legislation is pas
ed will not differ greatly from it.
fact. most of the bills introduced hay
been similar to Mr.. Baruch's plan. Bl
while most of the proposed bills al
within this field of carefully teste
practicability, there are other .mea
please Turn to Page Thirteen)