The producers news. [volume] (Plentywood, Mont.) 1918-1937, 1933-10-13
How Does Cancellation Strike
You, Mr.. MOrgenthau?
AN EDITORIAL

HENRY MoRGENTHAU is the Governor of
IL the Farm Credit Administration of the
Roosevelt government. He is the man who by
refnancing, is saving the farmers of this coun-
try from foreclosure md encompassing ruin.
On the radio the other night Mr.. Morgen-
THAI explained how refinancing is saving the
farmers He told the story of John Hagen,
f.rmer in county, Illinois. Here are some of
the things Mr.. Morgenthau said:
Low prices for his hogs, and his cattle, his
corn ard his wheat, have brought him close to
the financial rocks. But he is a good farmer and
ne has 200 acres of good land in a good farm
ing country. He has an $4,000 first mortgage
on his farm, a conservative mortgage in ordi-
nary times, which he has been paying per-
cent interest. In the last year he hasn't been
able to meet his interest payments. The mort
gage is threatening foreclosure. He has made
various attempts to arrange new mortgage,
but without success. The story he has heard
everywhere is that nobody is making any new
loans farm land
"But this is not the greatest of John Hagen's
troubles. He has had to borrow more money in
recent years to pay taxes, to buy food and
clothing for his family, to put in his crops He
is in debt to the town banker, to the implement
dealer to the feed dealer, to the general merch-
mt. Beyond the first mortgage, he owes $500,
and interest this amount averages per cent.
He has been able to get this lire of credit be-
cause he is known as good farmer nnd a man
who pays his debts But now all these creditors
are pressing him hard and threaten to throw
him into foreclosure if the first mortgage holder
doesn't.
"He has had to take his boy out of school
to save expense and to help him with the work.
Last year, with the closest economy and hard
work, he barely made operating expenses, not
including his taxes and his interest, which
amounted to 1920 alone"
Mr.. Morgenthau then went ON to tell how the
farmer, John Hagen, heard about government
refinancng and obtained new loans to pay off al
his debts. Thus John Hagen has been saved.
"His interest charges" said Mr.. Morgen-
than, "are now 1905 instead of 1920. This il
all he will have to pay for three years Afte
TINT he will have to begin paying off the sec
ond loan of $4,000 at the rate of $500 a yea
and two years later he will need to begin max
ing sm2ll principal payments on the $4,000"
NOW, Mr.. MORGENTHAU, there are some o
IN US who are too dumb to understand how thi
is going to save John Hagen. Of course, you ar
a very educated man and an expert in thes
things, and we are only simple farmers who fin
it hard to follow your complicated reasoning
But if John Hagen last year. with the closes
economy and hard work, barely made his OF
Grating expenses and was unable to pay inter
est md taxes amounting to 1920, how is he gOin
to pay $605 this year,
! Maybe you will tell us that increased price
for farm products will bring John Hagen
greater income this year? Well, don't expe
us to believe that stuff anymore. Why yo'
own friends tell us differently.
We heard from the U. s. Department
!. Agriculture that between July Is and Augu
is, the farmers purchasing power dropped
per cent. Secretary Wallace said on Septemb
8 that while farmers cash income has been
creased, the higher retail costs have absorbed {
increase and left him better off for meetl
his interest, taxes end fixed charges.
There is a Lot Of talk that farm prices ma
risen. But it seems that this Is only talk.
latest report of the U. S. Bureau Of Labor .