EEPOET OF THE SECEETAEY OP AGEICULTUEB. 85 



The duty of preparing and reporting to the Congress on or before 

 January 1, 1916, a bill or bills providing for the establishment of a 

 system of rural credits adapted to American needs and conditions has 

 been imposed upon a joint committee of the House and Senate. It 

 is expected that as a result of the deliberations of this committee 

 legislation will be proposed which will furnish a practical solution 

 of the problem from the financial viewpoint. 



It is generally recognized that the rural-credit problem is not a 

 simple one. It is essentially complex. There is no single solution 

 of it. Specific financial legislation on the part of the Federal Gov- 

 ernment, or of the State, or of both, will not furnish a full solution. 

 It seems clear that there should be a Federal law providing for a 

 land-mortgage banking system. It is a question whether by Federal 

 action existing banking arrangements may not be so modified as to 

 bring them into closer contact with rural communities and with 

 individual farmers, giving farm collateral more readily and fully 

 the advantages of the rediscount feature of the Federal Reserve Act. 

 It also seems clear that legislation on the part of States permitting 

 and encouraging the creation of personal-credit unions and removing 

 any obstacles that may exist to the easier and more orderly handling 

 of farm finance should be enacted. Reenforcing such agencies there 

 would be at work all the great forces of the Department of Agri- 

 culture, of the land-grant colleges, and of the State agricultural de- 

 partments. Their activities all contribute to make agriculture more 

 profitable, to improve distribution, to eliminate waste, and to inject 

 business methods into farming. In proportion as they accomplish 

 these tasks they tend to solve fundamentally the whole problem of 

 rural credits. Further Federal legislation vitally important to a 

 more efficient agriculture, such as a cotton-standards act, a grain- 

 grades bill, a permissive warehouse law, and proposals for the im- 

 provement of marketing conditions, also will contribute directly to 

 its solution. 



But even if all the desirable legislation were enacted and were put 

 into operation there still would be a vast amount of constructive 

 work to be done by individuals and groups of individuals, including 

 the farmer, the business man, and the banker. If these assume a 

 helpful and constructive attitude, they will furnish indispensable 

 support for practical reforms. All these forces working in combi- 



