The Nonpartisan Leader Newspaper, May 6, 1918, Page 12

| | ; " loot the treasury. This War Financea Congress BY W. G. ROYLANCE HE American farmer has so long been on the ragged edge of the financial system that most people find it difficult to grasp the idea that there is any need to give any special considera- tion to the problem of farm finance, even in so critical a time as the present. Many still think that not any but the most thriftless farmers will borrow money anyhow, no matter how good a chance they get to borrow. Self-constituted ad- .visers constantly urge the farmer against going into debt, and usually fail to distinguish between legitimate borrowing for purposes of production, and running into debt to cover living expenses. Until recently this country had no policy of farm finance. Private bankers and trust companies gave some attention to the mortgage loan side of it, but almost wholly from ‘the point of view of the in- vestor, and scarcely at all from the point of view of the needs of the farmer, or that of the absolute need of the entire nation for an agricultural de- velopment that would assure a sufficient food sup- ply. Thus it has happened that the country in entering the most destructive war is faced with the danger of a falling off in production that may seriously prolong the war, or even impair the cer- tainty of victory. STATESMEN RIDICULE FARM LOAN SYSTEM Neither the government nor the people of the country have bgen blind to the importance of the food supply. When it was said, just after America entered the struggle, that “food would win the war,” everybody understood. But few realized that farm- ing would have to receive as much care on the part of the government as the building of ships, the raising and equipping of armies, the financing of war industries, or the bringing out of the chaos into which private mismanagement and mistaken public policy had brought the railroads. It was not widely understood that the farms would have to be manned, financed and provided with marketing and transportation facilities much better than they had ever had before, if they were to produce the food that would win the war. Among all these matters that of farm finance has been least understood. Few statesmen were able to see that there was any call for extraordi- nary provision on the part of either the nation or the states. When, after private banking interests had failed to handle the federal farm loan bonds, it was proposed, in order to save the farm loan systemn from failure and ' destruction, that the United States treasury be empowered to pur- chase $1,000,000 of the bonds, not only did pri- vate banking interests, through a paid lobby, do their worst to defeat the measure, but many well- intentioned financiers and public men ridiculed the proposal. “What,” they asked, “is the sense of borrowing money from the farmers by the sale of Liberty bonds, if the government is to return it to them immediately through the farm loan banks.” FOOLISH DELAY OF THE BAER BILL When it became ap- parent that because of extraordinary crop losses last year and the year before, many wheat growers would be unable to plant a crop this year, & relief measures = were proposed. These meas- ures were widely . con- demned as schemes to was: notwithstanding that every.day the food sitn- ation is becoming more ‘of their present equipment. Many farmers in the Northwest would be producing fat cattle of this t port that they now lack. It is well finished stock ready for the block t man, But to finish them requires capital that they may be held these things are not available to United States farmers Canada within the last year cattlemen are being financed laid down by the Nonpartisan league for “state-managed rural credits at cost,” one of the most impor- tant planks of the League platform. : i %, e Sk 3 7 menacing; that without help thousands of farmers will be unable to pay for feed for their work ani- mals or seed for planting; that local banks are asking from 10 to 12 per cent for season loans; and that many of the banks are unable to supply the needs of the farmers even at those rates. The most important of the proposals for finan- cial relief to the farmers, that embodied in the Baer bill, was misunderstood and delayed. The argument that defeated it in committee was by the secretary of agriculture, which was that it was then too late to help this spring’s planting. After the defeat of the bill in committee, by the vote of the'chairman, there was an awakening. It was re- ported that Mr. Baer was asked to get together - the other representatives of the states most need- ing aid and frame a new bill, calling for a smaller appropriation, and including a provision for the mobilization of farm labor. This was done and the new bill was passed by the lower house of con- gress. The senate, however, has dilly-dallied until, even if the bill is accepted there it will be too late. What planting will be done is already in. POOR REASONING OF THE OPPOSITION What is the actual situation, for the relief of which Mr. Baer’s bill was introduced? Replivs from over 3,000 farmers and 1,800 banks to inquiries sent out by the National Nonpartisan league, show that there is most pressing need for over $60,000,000 more than the local banks can lend to the farmers. For the money that is avail- able the banks are asking from 10 to 12 per cent for the season, and will accept only merchantable security. In many instances farmers greatly in need of money for the purchase of seed are not able to furnish such security, and in many others, farmers able to furnish the security refuse to pay the high rates, declaring that their earnings from the farm will not warrant it. In the absence of financial relief these farmers will plant a smaller acreage, confining their operations to the capacity Some people are in- clined to condemn this cautious attitude on the part of the farmers; but the farmers are undoubtedly right. They will do no good either to themselves or their country by planting more than they can take care of. In fact to do so would incur a waste of their labor and equipment and render them un- able to go on with next year’s production. The government has departed from business tradition with regard to the financing of the other industries. and activities necessary to carrying on the war. It advances to munition makers, ship- builders and those engaged in other industries closely connected with war operations, 30 per cent of the price of materials contracted for. It man- S PAGE TWELVE, ype if they had the financial sup- that bring prosperity, to the cattle- , capital to purchase or raise feed; and (except through banks at high interest). In by state and municipal rural credits along lines nd the American Farmer Is Neglecting to Aid the Most Vital Industry at the Time Food - Is Worst Needed—What Happened to the Baer Bill? ages and finances the railroads for their owners, and guarantees them returns .on their shares of stock, equal to their average annual earnings for the last three years. Nor is this enough. There is now before congress a bill providing for the cre- ation of a finance corporation, through which the government will supply money to industries neces- sary for carrying on the war, where such industries can not be financed through the ordinary channels. Yet it seems to be expected that the farmer, en- gaged in the most necessary war industry of all, will worry through somehow without help, and will “deliver the bacon.” And doubtless he will, but the bacon may be a little lean. After all, the worst feature of the farm finance situation is the extortionate rates the farmer has to pay. He will do his best to put in, bring through and harvest the required acreage, and to do this many will borrow every dollar they can get, re- gardless of the high rates. But it will require only a few years of such rates to ruin the most pros- perous farmer. It has been possible to pay these high interest rates in the past only because the virgin fertility of the land was not yet exhausted, and at that it could be done only on the best land. On the poorer farms high money rates and other unfavorable economic conditions have already bankrupted thousands of farmers. If the war con- tinues two or three years, with no adequate finan- cial system for the farmers, thousands more will be added to that number. If the farmers in the Dakotas, Nebraska, Kansas, Texas, Colorado and Montana who suffered most crop losses last year and the year before borrow this year at 10 per cent, enough to enable them to make up their de- ficiencies and carry them through until after the harvest, they can not under the most favorable conditions produce enough to pay the interest on what they borrow and leave enough ahead to plant a crop next year. If, through drouth or other un- avoidable causes, they lose again this year, their case will be hopeless. As producers of food they will be eliminated. f A Business Man With the Farmers Doland (S. D.) Editor Gets Rough Treat- ment From A. R. Fryer ! There are some enlightened business men who see that the National Nonpartisan league is for the benefit of the whole people. One of these. is A. R. Fryer, president of the Farmers’ Lumber company, Doland, S. D. In a letter to the Leader he says: “IT SEEMS STRANGE THAT SOME PEOPLE WILL FIGHT THE FARMER WHEN IN FACT THEY WOULD ALL BE OUT OF BUSINESS IF THE FARMER WOULD QUIT THEM COLD. Wake up, you farmers, and let them hear from you!” The rest of his letter reads: “I have been reading your magazine for the last 18 months and will say that you are shed- - ding much light on the dark spots. I hope to see this good work go on for years. It has taken the . farmers a long time to wake up, but when they do, look out. i “There are a lot of pin- head editors in other places besides here in our town—men who will stoop to any dirty work for a few dollars. We have one of the smallest, sneakiest editors that ever lived. e “Our editor is all the time finding fault with the Nonpartisan league print a lot of bosh for’ the Republicans.” while he is being paid to 7