The Bingham County news. [volume] (Blackfoot, Idaho) 1918-1930, 1923-07-06
EDISoN-FORD PLAN
UNFAIR TO FARMER
Third Article Shows How Credit
Test Would Fail Him in
His Need.

The unfairness to the farmer OF
the Edison-Ford commodity money
scheme, although ostensibly aimed to
improve his economic position, is dis
oussed In the present article, which
II the third In series prepared by the
American Bankers Association, re-
viewing the exposure of the weak
nesses of the plan as presented by
william T. Foster, Director of the
Pollock Foundation for Economic Re-
search.
Briefly, the plan, sponsored by Thorn
~ Edison and Henry Ford, would pro-
vide for Government warehousing OF
basic commodities, against which cur
rency would be loaned, during storage,
10 the producer without interest, up to
half the average value of the prod
ucts for the previous twenty-five
years. On the other half Of the value
the producer would receive certif-
Gates which he could sell or use for
bank loans.
Restricted Credit
In chat provision allowing for Gov
eminent loans only up to half the
average value for twenty-five years
M. Foster finds particular weakness
n the scheme. Hs points out tAst
prices have risen 50 high since 1896
hat the farmer could borrow ON most
products much less than half the pres
eat value Of the products-much less,
II faGt, than he could borrow directly
IRON the banks. Loans on the other
AAn the value. which would be on
virtually . second mortgage basis, no
says, would not be desirable for the
hanks.
The plan IL not fair even to farm.
srs; It involves unjust discrimina-
t1on," Mr.. Foster says. 1.-THE Edison
plan dxes the loan values of all prod |
ucts absolutely, uniformly and arbi- |
trarily. It ignores the relative pros
poets of different commodity markets.
Only by the merest chance would such
. method give a fair loan valuation.
Fifty per cent of the average price
for the previous twenty-five years
would be too high for some commodi-
ties and too low for most of them.
With such details the Edison plan II
not concerned.
Banks Fairer to Farmers
THE general practice of the banks
ID not only fairer to farmers, but it Is
,ounder business. There is no justi-
ication for basing the loan value Of
anything upon average prices in past
years. Sound banking practice looks
o the future. A bank-for the pro-
lection of it's depositors, If for no
,ther reason-must consider above
the prospects of getting
is money back. And a farmers pros
,ects of repaying loan from the sale
# his product depend entirely on fu-
ure prices, not at all on past prices.
LAST years runs do not count in this .
ears game"
AS to the claim that the Edison
Ian would curb speculation in farm
Mr.. Foster says:
There is nothing In the Edison
Ian that would tend to abolish spec
lation. Even after the farmer had
tored his products and obtained a
IAN from the Government, he would
till be free to sell his products out
ght to spectators. The farmer
'o,ild have all the inducements to sell
,at he has today, and spectators
'ould have all the inducements to
ny.
Clearly, then, tho Edison plan
ould not provide q money that is :.
,under than gold money: It would :
ot provide q money less subject to :,
in value; 1t would not en-
Die farmers to obtain larger loans :.
IAN they can now obtain: It would :
1t divorce agriculture from the
mixing system; and It would not .
inmate speculation In farm prod I.
.ta !"