26 AGRICULTURE OF MAINE. 



rather briefly to describe two that in the judgment of those who 

 have been making careful inquiry into the operation of these 

 credit systems abroad are best adapted to American conditions. 

 The first of these is the so-called Raiffeisen system, so called 

 because of the name of the founder, a man in Germany who in 

 abovit the year 1849 observed the handicap that rested on the 

 German farmer in the matter of obtaining credit to handle his 

 activities and organized among local groups of German farmers 

 these so-called Raiffeisen associations. They were based 

 upon certain, rather few, fundamental principles. One of these 

 was the unlimited liability of each member of the association 

 for the obligations of the association. Another feature of this 

 system was the confining of the borrowing privilege to mem- 

 bers of the association only. The credit of those who belonged 

 to this association was of a personal character only. That is, 

 there was no mortgage upon any real estate individually. It 

 was simply the matter of combining the personal credit of those 

 who wished to join the association and who contemplated be- 

 coming borrowers themselves to a greater or less degree. 

 Again, the cost of maintaining these associations was made very 

 low. There was only one officer — and that, I may say, is still 

 the feature of this system — who received any compensation, 

 the treasurer. And when I say that today the expense 

 of maintaining these local agricultural credit associations 

 averages only about $150 or $175 a year, we appreciate the 

 great economy that is associated with their conduct.. A 

 further feature of these associations is a committee, a super- 

 visory committee, that passes upon the application of any 

 would-be borrower, who, it is to be remembered, must himself 

 belong to the association, and inquires into the purpose for 

 which he wants his loan. The loan must be applied to a so- 

 called productive purpose, it would not be permitted to be ap- 

 plied to a consumptive purpose; a man would have to demon- 

 strate to the satisfaction of this committee that the purpose for 

 which he wanted this small loan was one that was reasonably 

 likely to succeed. If in the judgment of the committee the pur- 

 pose was not apt to be a successful one he would be refused 

 a loan. The man as a borrower would also be required to 

 have two sureties on the note he would give representing the 

 loan, the names of two people, also themselves members of 



