Missouri Country Life Conference. 253 



tion of the foreign-loan system, while co-operation among our 

 farmers has been tried often, and, according to my observation, 

 to no great success. In Germany every thirteenth inhabitant 

 is a member of one of these afTiliated associations, and while all 

 rural banks accept deposits from everyone, they will only lend 

 to members who are properly endorsed by other members. 

 Savings accounts in both France and Germany far outnumber 

 those in this country, and the rate of interest paid is about three 

 per cent. It is easy to see the source of the money loaned to 

 the European farmer, while in this country, with its vast oppor- 

 tunities for speculation, our people, in a large measure, prefer 

 to do their own investing in land where the possibility of large 

 returns is so attractive. 



Many Americans have for years advocated the making of 

 farm loans by the government, which is a fallacy. The whole 

 plan of government farm loans or government guaranty of farm 

 loans, as in the case of the Saskatchewan idea, eventually will 

 resolve itself into this: No government can make loans simply 

 because it is a government. No government can rise superior 

 to the economic laws which govern the value of money, and no 

 government can fix an interest rate which will apply on all farm 

 lands alike. To attempt to do this would be to invite disaster. 



The cry for cheap money for the farmers is largely one by 

 those who do not understand the situation. During the last 

 year it is a fact that farmers in Illinois have been able to borrow 

 money through the life insurance companies at lower rates than 

 the big business men of Chicago have been able to secure it. 

 The only reason why more thinly-settled sections have not been 

 able to do this is that the local conditions do not warrant it, 

 and this would be the same whether the government or a pri- 

 vate individual attempted to make the loans. 



It is my opinion that if we are to inaugurate a successful 

 system of farm credit we should try to forget the methods 

 employed by credit associations in Europe. What we should 

 do is to try to comprehend the principles employed and seek to 

 adapt them to American ideals, customs and governmental 

 methods. 



What is wanted is some method by which young men who 

 wish to become farmers may offer evidence of ability, thrift 

 and character. There is wanted some guarantee that the money 

 will be used for productive purposes and sufTicient supervision 

 to determine that the money will be wisely expended. What is 



