ORGANIZATION OF ACKICUI/rURAI, CklvDIT 3() 



At present a Spanish farmer can nominally obtain the credit he needs, 

 outside some establishments having more or less local importance, from the 

 following institutions : the positos, the Bank of Spain, the Mortgage Bank, 

 the Bank Leo XIII, and the rural funds. We say nominally because, in 

 consequence of the faulty management of which we have spoken, the pdsi- 

 tos are far from supplying the needs of the peasants ; the Bank of Spain, 

 in spite of goodwill and government encouragement (i) has not the organiza- 

 tion and elasticity necessary to transactions in agricultural credit ; the Mort- 

 gage Bank, although specially founded to help agriculture, is active, almost 

 exclusively, in urban spheres ; the Bank Leo XIII, while by its loans to agri- 

 cultural sjTidicates it accomplishes really useful and practical work, has 

 its sphere necessarily limited by its connection with the Church and suffers 

 all the consequent inconveniences ; and finally the rural funds, except in a 

 very small number of districts like Extremadura and Navarre (2) for lack 

 of resources only vegetate miserably. 



To resume : in no country as much as in Spain is capital withdrawn 

 from the country districts, including capital formed there and emanating 

 therefrom, and does it so tend to be invested securely in State funds rather 

 than to find any investment where interest depends on the work and intelli- 

 gence of those administering it. The farmer on the other hand cannot obtain 

 credit directly from the large urban establishments which in Spain absorb 

 public savings, for these do not know him and do not accept his signature. 

 It follows that it is necessar}^ to create an organism which will be able to 

 procure funds where money is concentrated, placing it at the disposal of 

 peasants to be employed productively. This necessity forms the basis of 

 the Central Fund of Agricultural Credit at which the decree which we will 

 examine aims. 



§ 2. The royai. decree of 12 july 1917. 



Under the modest title of " decree relative to the creation of a central 

 fund of agricultural credit " the royal decree of the 12th of July of this year 

 covers the whole problem of agricultural credit and establishes the bases 

 of an organization which will allow of its solution. The measure does not 

 confine itself to setting up an official establishment responsible for supply- 

 ing money to agriculture. It at the same time defines and regulates the 

 reciprocal relations of the farmers grouped in associations and offering in 

 the collective liability of all their members a sufficient guarantee to lend- 

 ing institutions, and also the relations of these associations with the Central 



picion with which they are still regarded by peasants, in spite of the very considerable servi- 

 ces they once rendered to agriculture, is easily understood. For caciquismo in the Spanish 

 country see Bulletin des Institutions Economiques et Sociales for July 1912, page 123. 



(i) See our issue for November 1915, pages 33 and 34. 



(2) See our issue for March 1915, pages 10 to 27. 



