Arizona republican., 1922-03-06

business conditions throughout the
country Roger W. Babson, economist,
furnishes the following exclusive
statement to the Arizona Republi-
can on conditions in the farming
sections of the middle west.
There is no use Disgusting the fact
that conditions are pretty bad out
here. The expected fall rise in busi-
ness was apparent In all sections of
the countrye except in these western
states bordered by the Mississippi on
the east and the Rocky mountains on
the west. Throughout 1920 the farm
ers tended to hold their crops pend
ing higher prices but, as statistics
clearly indicated would be the case,
prices declined throughout the year.
Hence farmers reached the end OF the
year with pressing obligations and
no funds. All classes Of farmers
were hit but I find those depending
primarily upon corn are the worse
off OF all the state in this belt. !
find Iowa most depressed and Min
nesota the best off.
Those engaged in stock raising or
more properly speaking in the feed
ing of stock--haye the greatest mon
etary loss. Many a farmer l have
met, who year ago purchased stock,
has been feeding it IL months and
cannot today get for his fat cattle
what he paid a year ago. Others
have cattle which they purchased g
months or two years ago and these of
course are in much worse fix. The
same applies TO sheep and hogs.
Hence the banks in the cattle and
sheep sections are in a weak condi-
tion. although / believe 95 per cent
of them will come through all right.
Il find a great interest in this Sec
tion for heavy protective tariffs, eS-
peciaIly on wool, hides and other
products entering into industry. The
farmers are panic stricken, grasping
at straws here and there for tenn
porary help. They are the real boil
shevists today and are actually ia
voring some OF the uneconomic doc
trines that Russia has already tried
and found to be useless. Only great
er efficiency and wider markets will
belp the farmer in the long run.
Higher tariffs tend only TO reduce ef-
ficiency and narrow our markets.
Besides the farmer will never get a |
tariff on his raw materials without |
giving the manufacturers a, tariff on |
manufactured products and the dou-
BILE tariff will so increase the cost OF |
living that no one will be better off.
Generally speaking, the wheat
growers of the northwest are not |
like the corn and cotton |
growers. Minneapolis I find to be |
the most optimistic city of the west |
ern states. The banks of Minnea,
polls and st. Paul, seemed to be in |
good condition and the stores OF these |
cities are doing a fair business. Per-
haps it may be said that Minnesota |
has turned the corner: but this is not |
true of any other state in this belt. |
Nineteen hundred and twenty-five is |
destined to be bad year for this |
section.
"This means that the western,
states will buy very little during |
1929, even although they bought al
most nothing during 1921. The pur-
chasing power of the farmer has been
cut from 80 to 75 per cent. More
over, his hope rests not in higher
prices but in reducing his operating |
expenses. Manufacturers and mer-
chants desiring to dispose of goods in
these states during 1922 must fea- /
ture smashing price reductions"
Farmers will not be attracted by the /
quality OF the goods. Price will be
the only consideration. Labor saw
ing devices and other necessities may |
be sold but very few pianos, phono-
graphs, or luxuries of any kind will
be shipped into these states during
the current year.
statistics have strongly indicated
that even during average years very
few farmers have made money oper-
sting their farms. mean that il
farmers were obliged to keep books
the same as manufacturers and |
charge up wages for themselves and
families and interest on their invest
ment. most farms would show a loss
on average years. The farmer has
really made his money through the
natural increase in the value of his
land. The farmer is technically
great speculator. He speculates not |
only in his products but in his real /
estate holdings. There are far more
spectators in Nebraska than in New
York.
Farmers complain about the wa
tered stock of the industrial corpora
tions of the east, but there is far
more water in their farms than in
the average industrial corporation of
New England, New York or Pennsyl-
vania. However. there won't be much
specuIating in farm lands during
1922. The tendency will be con-
stantly downward Farm land prices
are bound to go through a period of
readjustment and the lands OF these
western states will suffer the most.
The greatest decline will come in /
farms which are rented. The real
farmer who both owns and operates
has nothing to fear from temporary
decline in values. Like the seasoned
who have weathered
many depressions, by not expanding
during the preceding periods of pros
perity, the honest dirt farmer has
nothing to fear.
what is the hope for this section
is the question which everybody
asks. The answer is that old and
one diversified farming"