274 IOWA DEPARTMENT OP AGRICULTURE 



one lump sum, have them mortgage their lands, individually and col- 

 lectively, for a period of twenty years agreeing to pay off these mortgages 

 in stipulated annual payments at a low rate of interest so that they 

 could get out of debt, improve their lands, put their people to work, 

 and he able to pay their taxes to the government. Tlie plan was adopted. 

 Frederick the Great furnished $262,000 from his private treasury to 

 finance the institution, and the first landschaft was organized in the 

 province of Silesia. The barons mortgaged their land for enough to pay 

 their debts, their taxes, and to start their tenant farmers to work; they 

 continued to pay their obligations promptly because the government re- 

 quired them to do it; and at the end of twenty years those lands were 

 free from debt, except in some cases where the mortgages were renewed. 

 That institution is doing business today in the same locality, and from 

 that simple beginning grew the great German system of financing agri- 

 culture which has developed the agricultural resources of that empire 

 to such a wonderful extent. The reason the German empire is holding 

 at bay today the allied armies of civilization, and that the black cloud of 

 autocracy is threatening the future liberties of the world, is because Ger- 

 many had foresight enough a century and a half ago to lay broad and deep 

 the foundations for financing her agriculture so that she could build a 

 stable commercial structure, and that is what we are up against. These 

 farm institutions grew' so prosperous that when the University of Ber- 

 lin was founded, the German government borrowed the money to do 

 the first building from the farmers' co-operative banks, which owed their 

 origin to the establishment of the landschaft in Silesia, under the reign 

 of Frederick the Great. It is a good thing we learned the lesson in time 

 to enable our farmers to avail themselves of the benefits of that kind of 

 a system, before we were brought face to face on the battle line with 

 people who are past-masters in the administration of it. 



Q. How large a territory do these loan associations cover? 



Mr. Odell : We have in the state of Iowa 238 local organiza- 

 tions, either completely formed or in process of organization, 

 which cover almost every county in the state. There are some- 

 times two or three in a county. We do not wish to have more 

 than one in a given town or community. They sometimes cover 

 the entire county, as, for illustration, the one which we have in 

 Des Moines, which has under its jurisdiction all of Polk county. 

 In Shelby county we have four associations, which have filed ap- 

 plications for loans to the amount of over $800,000. 



Q. Who receives this one-half per cent? 



Mr. Odell : We have recommended to all of our associations, 

 under the informal recommendation which is made by the Farm 

 Loan Board, that this local association, when it selects its princi- 

 pal business officer, who is termed the secretary-treasurer, shall 

 be paid a compensation fixed at one-half of one per cent of the 

 amount of the loans. This officer need not necessarily be a mem- 



