Seventy-Third Annual Report 1213 



guarantee those of the state association, so that there shall he 

 one common issne from a central organization in this country, 

 the great reservoirs of capital in the old world as well as in the 

 new will he at the command of the American farmer. 



We cannot, of course, transplant anv institution from abroad 

 without some moditications. There is one feature about the 

 Credit Foncier which we should not be willing to adopt in this 

 country, especially since the legislation of Governor Hughes, and 

 that is the feature of what is called lottery premiums, by which 

 the holder of one bond of a certain number will draw a special 

 prize when the bond is paid. Anglo-Saxon legislation, at least 

 in modern times, does not look favorably upon lotteries as a 

 means of raising public revenue. It is true also that the Credit 

 Foncier de France has not done as much for the farmer as it 

 might have done. A considerable proportion of its loans are 

 made upon urban and suburban property, and that constitutes 

 perhaps an argument against too great centralization, because 

 the C^redit Foncier de Franco — and that is true substantially 



t- 



I think of the larger institutions of Hungary and Germany — are 

 single institutions, with branch offices of course, but controlled 

 absolutely from the center, so that they have not the local sym- 

 pathy and do not make the effort for local development which 

 would be made l)y a local land mortgage bank. If we can combine 

 with the prestige and the resources which arise from centraliza- 

 tio2i, the local interest which arises from a state institution, then 

 we shall get the benefits of both. 



I shall not have time to-night to go in great detail into the 

 local cooperative credit associations. Very often, more perhaps 

 than in the matter of the land mortgage banks, it is necessary 

 that local conditions should be carefully studied and that the 

 institution or the form of organization adopted should meet local 

 prejudices and to a certain extent local experience. It is in 

 Germany that these institutions have perhaps attained their 

 greatest development. There the farmers of a given community 

 get together, form a mutual society, turn in what money they 

 have by way of deposit — those who have a surplus — and take 

 that surplus and lend it to their associates. But the loan is 

 guaranteed by the whole society. In some societies the principle 



