Evening star., 1933-04-09
New Chief of Farm Credit
Agriculture

needed to perfect the plan, and this
Is up to Congress.
But all this, as was said above, Is
only the first part of the farm-credit
program. The second part, though not
immediate and urgent, is not less i'm
portant in the whsle picture.
Once clean-cut, simple credit
structure, adequate to meet the needs
of agriculture, is set up, or Is well on
the way, it Is the Presidents further
thought that it should be decentral-
ment owned by the farmers them
selves. The system would consist es-
sentially of regional cooperative credit
organizations. locally controlled and
getting somewhat the same kind of
supervision from Washington that
the Federal Reserve System exercises
over member banks. At first the Gov
ernment itself would have to operate
the entire system, but as rapidly as
possible control would be turned over
to the communities.
If such a plan were carried out 1t
would nulltfy any criticism that farm
credits were arbitrarily controlled.
So much for the farm-credit set-up
as 1t is conceived in these early stages.
Mr.. Morgenthaus job is not by any
means confined to the heady and in
spring work of helping to formulate
and carry out broad plan like this
There are the devilish and messy de-
tails of cleaning up the legacy left by
previous efforts to stabilize the market
in various farm commodities. Wheat,
which Is now statistically strong. Is
probably the least troublesome part
of the problem. Much more difficult
is the matter of more than 10000
bales of cotton on which the Farm
Board made loans, and nice bill for
carrying charges coming in inexorably
every month. This represents about
one third of the annual consumption
of cotton by domestic mills. But in ad-
dition, Mr.. Morgenthau, as a result of
his Office. Is coffee merchant on a
large scale and under the reorganiza-
ton will inherit from the Crop -produc-
ton Loan Division of the Department
of Agriculture liberal supplies of al
most everything from cotton to canned
tomatoes. OF roughly 100000 bushels
of bluegrass seed in the United States,
the Farm Board had loans out of around
2,300,000 bushels. And so on.
Acts as er-Salesman.
How to get out from under this stag
gering inventory is enough to turn an
ordinary man into a nervous wreck Mr.
Morgenthau apparently remains calm
pending the appointment of a liquidatoI
in chief-and what a job! Mr.. Morgen-
thau has been acting as the Govern
ment's super-salesman himself
One thing he determined to do and
that was to liquidate as rapidly as pos
sible. The policy of hanging on is
finished. It not only means a con-
stantly increasing loss; it means that
existing funds that might be made
available for the legitimate marketing
operations Of co-operatives must be
used to hang on to stocks that are
nothing but a drag on the market
Getting rid of them is a painful op-
Grafton, but it has to be done. Also
Mr. Morgenthau is against keeping Sc
cret any longer the amounts of va
rious commodities on hand. Uncertainty,
in his view, helps to keep the market
depressed.
Moreover" he said, "once imme-
diate commitments are out of the way
Farm Board loans-or what used to be
Farm Board loans-Will be made only
for the actual marketing business OF
co-operatives. Cooperative marketing
reduces costs and makes possible a
SICdtCI ICbutN dIlG
this is legitimate use of Government
funds. But public funds cannot be used
to aid speculation in commodities
whether on the part of cooperative;
or anything else"
Another change in policies has been
the speeding up of loans. Formerly
the making of a loan was a cumber-
some procedure that sometimes took
weeks. We have simplified it to the
point where we can get loan through
within "a hours of the time the appli-
cation for the loan Is made. In this
speeding-up process, DR.. w. L. Myers
of Cornell, my assistant, and Herbert
E. CASTOR, who was appointed secre-
tary of the Farm Board when took
Office, have gladly taken on new and
difficult responsibilities"
Which seems to be the spirit in
Washington these days.