The Nevada County picayune., 1923-03-08
FORD-EDISON SOUND FINANCE

v acknowledged defects in our present monetary system. One of the great est of these defects is the inheebility of our circulating medium. Admit ting for arguments sake that for eight months in the year that there is a sufficient volume i'll circulation to transact the business of those months. during the remaining four the great cotton and grain crops are on the market and require an i'm mense additional amount of money to move them. If those who own the gradually the difficulty would be greatly lessened. but unfortunately they are not financially able to do this. although their cooperative so- cieties have recently helped them to some extent The enforced shortage of money at this period causes an an- nual loss of many millions of dollars to farmers who must sell at a sacri- flee. loss that is greatly felt by all in their communities who are depend ent upon them in a business way. Later, as the cotton and wheat finds it's day to market, the financial strin gency relaXes. but this reacts on those who have sold as they have to buy supplies in a higher market.
 The plan of Ford and Edison to remedy this condition is simple and effective. It is for the government to warehouse certain non-perishable products. issuing negotiable ware house receipts for them. loaning one half of their valge on non-interest bearing legal tender notes. These notes as they find their way into cir culatiOn will he the imitation of cur rency prevent d falling of prices, and as the products upon which the mon ey is loaned are withdrawn from storage and the cash advanced re turned it is withdrawn from circula ton, thus preventing an undue infia- tion of currency, thus automatically regulating the per capita in circula- tiOn.
 This is the principle of the Ford Edison plan which is similar to that of the Sub Treasury" plan advocated by the Farmers Alliance three dec- ades ago. Points of difference are: The Alliance plan provided for the warehousing of cotton and grain only as those were the principle products that caused a fiuctuating of prices. The Ford Edison plan calls for the building of cement warehouses by the government, while the Alliance plan permitted the government to build. acquire by purchase, or rent existing warehouses. The Ford-Edison plan provides that no interest be charged on the government loans, while the Farmers Alliance plan provided that two per cent interest be charged to cover costs.
 Most of the objections urged against the Sub Treasury plan fell to the ground when argued As the government was furnishing the banks with money at one per cent 1t WAS contended that it could be given the farmers at two per cent upon the best security in the country. As the gov ernment was making business of warehousing whiskey and issuing cer- tificates that were negotiable at any bank. it could hardly say it was 'un- constitutional" to do the same with cotton and wheat. Class legislation was charged, but could not be sus- tained in the face of the Govern ment's business dealings with the banks and distillers, and the fact that the farmers were paying for what they received, and this plan was necessary for the public welfare, that the government should issue nOn-in- terest bearing notes was considered by the money loaners a crime, but this has been done before with success, was constitutional, and could ba done again. The banks claimed that the money they borrowed from the gov ernment was secured by gold bonds but hte farmers argued that their wheat and cotton was better security than gold bonds. While the Su Treas nrv Plan had a strong following it