The Nonpartisan Leader Newspaper, September 20, 1920, Page 7

platform is: “Rural credit banks operated at cost.” The Bank of North Dakota, created by the 1919 legislature, recently celebrated its first birthday. It has in its first year of operation completed near- 1y 800 farm loans, totaling in amount more than $3,000,000. All of these loans were made at 6 per cent mterest, with provision by which the borrower, paying an additional 1 per cent each year, pays off the prmclpal at the end of 80 years. According'to the statistics of the United States: department of agriculture, the average interest rate on farm mortgages in North Dakota has been . 8.7 per cent. The average rate in the western half of the state, in which most of the state loans have been made, however, is higher, running from 9 to 10 per cent. It is natural that this should be the case because in the eastern part of the state, where 6 and 7 per cent money is obtainable, there is less de- mand for state loans. If 9% per cent be taken as the average rate of interest on loans that are being supplanted by state loans, the $3,000,000 state loans that have been made thus far represent a saving to these farmers. of $105,000 per year, the difference between 6 and 9% per cent interest. However, this is only a small part of the savmg' that has been effected by the -state-owned bank. The bank is closing new loans every day. ans of more than $2,000,000 have been approved, in ad- dition to the $3,000,000 completed. According to various estimates, from $100,000,000 to $300,000,000 has been loaned to North Dakota. Denmark 'farme_r‘s on first mortgages. The fact that the . ‘state-owned: bank is now loaning money at 6 per /. cent tends’to reduce the interest rate on all new loans, in spite of the fact that money is higher on- the world market than ever before. But loans to farmers, though the primary pur- vose for which the Bank of North Dakota was created, do not measure its usefulness. When the bank was created the members of the legislature were at the same time providing for other features of North Dakota’s industrial program—the state- owned mill and elevator and the state‘Home Build- ing association. They were far-sighted enough to consider the possibility that organized big business might attempt to use its power to cylpple these un- dertakings and they said, in thelr conferences STATE BANK STRONG ENOUGH TO FINANCE STATE INDUSTRIES “We can make t\:he Bank of North Dekota strong and powerful enouegh to finance the state industries - if - privately controlled banking, power refuses to buy state bonds.” So they added to the powers of the Bank of North - Dakota the power to finance the state and its indus- tries. Just as the legislators had foreseen as a pos- sibility, the organized money power of the country attempted to crush the North Dakota state pro- gram. -After contracts had been signed for the sale of $2,000,000 of state bonds, the validity of the North Dakota industrial program was attacked in the courts and a bitterly contested suit was carried to the supreme court of the United States, In the meantime money began to command higher anc higher rates of inte¥est in the world's markets anc state bonds, which a year ago were readily salable at b per cent, can not now be floated at 5% or ever 6 per cent. By the time thé state had won its case in the supreme court of the United States it was virtually impossible to sell municipal bonds of any kind. But for the Bank of North Dakota work or the great terminal elevator and flour mill at Grand Forks would have stopped immediately. But the Bank of North Dakota was on hand, strong enough to finance the work on the terminal elevator and flour mill, the work of the Home Building associa- tion and all other state enterprises that needed money. The state of North Dakota itself has been loaned considerable money by the state bank, during the period while tax collections are being made by the counties and the money is not yet available in the state treasury. By being able to transfer funds from one part of the state to the other, as they are needed, the state bank also helps the local banks; which deposit money with it, in their times of need. By acting as a clearing house for the banks of the ' state, the Bank of North Dakota is saving thousands of dollars every week for the banks. It is handling daily transit business amounting to more than $1,000,000 and running as high as $4,000,000. “On ~all of these dlearings the small banks formerly had (Continued on page 18) Land of Farm Co- Operation \ State Action and Voluntary Group Action Go Hand in Hand BY SPECIAL CORRESPONDENT agricultural co-operation in the world. The co-operative movement started “there in 1860. That it started in the country, instead of in the cities, as the co-operative’ movement has started in most other nations, was due to the Danish trade law of 1857, Today Denmark is the wealthiest country in the world in proportion to its population, and the wealth is also much more evenly divided than in countries like the Wnited States and Great Britain. This is in marked con- trast to the condition when the co-opera- tive movement started. Then Denmark was bleeding and exhausted from a losing war with the great military state of Prussia and could barely support its deci- mated population: One-half of the households of Denmark are today supplied with all their needs through the co-operative societies. These ~ are a few of the things the farmer can do through his co-operative: Buy a farm and build a house. | Get a personal credit loan to buy seed, stock and machinery. Have his milk churned by a co-opera- tive creamery, his butter and eggs sold - by €o-operative export societies. Send ' his livestock to co-operative ° slaughter houses and packers, His wife buys all household supplies at a co-operative store. ALL PROFITS DIVIDED AMONG CO-OPERATORS His daughter probably works in a co- operative factory under healthy condi- tions, living im a co-operative apartment house and dining at a co-operative cafe. Finally, the farmer insures himself and his family, his house, farm, stock and, crop in a co-operative insurance society, ‘sends any sick member of the household to a co-operative sani- tarium and spends the summer at a co-operative vacation camp. ‘And from all this no one gets a cent of private profit. In 1919 the total number of member§/ of the Dan-’ ish co-operatxve societies was 317,000, of whom 252,659 lived in the country districts and- 64,341 in the cities. In proportion to the: population, ‘the membership was 10 per cent, but as generally an entire household is admitted as one member, it would be more correct to say that the membership 4 icals, margarine, etc. / sl o5 ENMARK' is'the foremost country in - in proportion to the households, of which Denmark has about 600,000, was about 50 per cent. In 1918 the turnover of the Danish co-operative _ societiés amounted to about $40,000,000, or $112 per member. The total has increased rapidly in the last few years, to a large extent because of the general rise in prices. But also prior to the war, before the revolution in prices, the co-operatives developed in a remarkable way. In 1909 the turnover was $18,000,000; in 1913 it had increased to $26,000,000, and in 1918 it culminated with $40,000,000. “HELPING”. TRADE (R % ’/lr{’h//// each case. The lmportant thmg is to get nd of him. Through the “Joint Society for Danish Co-Opera- tive Societies” the co-operative movement not only carries on a wholesale business, but also is actively engaged in manufacturing. On account of the diffi- , culties, during the last few years, in procuring raw materials-, especially for the manufacture of oleo- margarine, the profiilction_ of the Joint society reached its peak in 1916, when it was:$4,500,000. ‘Among the manufacturing econcerns established by the Joint society are factories making chocolate, candy, cigars and cigarettes, soap, mustard, chem- Ready-made stits, under- ; PAGE SEVEN i —Drawn expressly for the Leader by W C. Morns. Whenever farmers or workers propose to det rid of a profiteerlng mid- dleman, the plea is made that he is “helping trade.” The fact is that a profiteer is always interfering with trade. Whether it is best, in any given case, to get rid of the, profiteer by voluntary co-operatlon between producers and consumers or by state action (which is me;ely co- operation on a larger scale) depends upon circumstances in in Richest Country of Europe wear, bicycles, etc., also are manufactured by the \ Joint society, whose profit on trade and manufactur~ ing in 1916 amounted to nearly $2,000,000. In 1919 there were 1,691 co-operative societies in Denmark. Of these 19——11 in the cities and 8 in the country districts—each had a turnover of about $80,000 a year. The combined profit of all the Danish co-operative societies in 1919 was $2,500,- 000, which at the end of the year was distributed among the members just as the profit of the Joint society wag distributed among the several societies. In this way the members of the co-oper- atives not only bought their goods con- l siderably cheaper than in most retail I stores, but at the end of the year they received a dividend of 6 or.7 per cent on the total amount of their purchases during ~the year. However, the interests that are pralsmg co-operation and at the same time urging farmers to stay out of politics can get no satisfaction out of what has happened in Denmark. Co-operation in Denmark start- ed in the country as the result of the trade law of 1857 and has glways been encourag- ed by the government. The government saw in co-operation the only chance to rescue Denmark from disaster. DENMARK’S LAWS LIKE THOSE OF NORTH DAKOTA A\ As co-operation has grown, state aid to the farmer has grown along with it. Den- mazk is the only country in the world which gives the farm laborer a chance to own a farm. A farm laborer with five years’ practical experience can get a'$2,800 loan from the government. - On this he pays 6 per.cent interest per annum, which, at the end of a term of years, obliterates - both principal and interest This p?wsmn of the Danish law is very similar t6' the home building plan in North 4 Dakota, which also extends state credit to non-owners of land in order that they may get a start. The co-operatives also are ready to help a man to buy a 10 or 12-acre farm. After he owns the land he can‘get further loans either from the governmient, as in North Dakota, or from the co- operative societies, in addition to loans on his per- sonal credit as a member of the co-operative society. - Denmark is noted for the excellence of its free agricultural colleges. In the attention paid to its agricultural colleges and its farm and home buying plan, Denmark and North Dakota are following much the same courses. & N