470 AGRICULTURAL CREDIT.—DAVIDSON. 
then repeatedly urged that “a measure which would provide 
facilities for the establishment of local banks . . . would 
confer a great benefit.” (Can. Hansard, 1885, p. 119.) And the 
advantage was supposed to be that savinos would by this means 
be fixed in their own localities, to the great benefit of borrowers, 
at least in such provinces as New Brunswick, which saves more 
than it can lend. Whether this difficulty can be overcome is 
another question. It is not overcome by any European system, 
for People’s Banks were devised to provide a remedy for this 
evil. Nor is it overcome under the highly decentralized system 
of the United States. The Canadian banking system is not an 
agricultural system, and perhaps never has been any more fitted 
to supply agricultural credit than it is to-day; but it is a better 
system, even for the farmer, than any other that has been 
devised as an ordinary banking system. As a matter of fact, 
fixing local savings, which seems so desirable to the borrower 
who resides in a district that saves more than it invests, is not 
realisable under modern business conditions. Sooner or later, 
economically or otherwise, surplus savings will find their way to 
the district where there is demand for them. ‘he distant bor- 
rower 1nay be made to pay more, but the money cannot be kept 
at home. 
There have been various proposals to amend our own and 
other banking systems in the interests of the farmers. So far 
as the Dominion is concerned, these proposals have been either 
to adopt the Dominion system of local banks or to establish land 
banks—neither of which promises any relief. The small local 
bank is not forbidden by our Canadian banking act, though 
new banks with less than $500,000 cannot now be established 
with rights of issuing paper money. Such local banks do ezntinue 
to exist, and chiefly in the maritime provinces. Of fourteen 
banks with a paid up capital of less than a million, ten are in 
the maritime provinces. None of the New Brunswick banks has 
an authorized capital of more than $500,000, and the average is 
only $293,000; one of these, the People’s Bank, the smallest in 
the Dominion. Yet these small banks do not serve to fix savings 
