102 ILLINOIS ACADEMY OF SCIENCE 



should alternately lead. In the '80s and '90s production led 

 demand, prices were low, and consequently the profits of agri- 

 culture were small. Prices were high because demand led 

 supply and there was a prosperous era for the farm operator. 



OPERATORS LIVING ON INTEREST, UNPAID LABOR, OR OUT OF 



CAPITAL. 



From the data secured from 765 farms it was found 

 that 164 farms secured labor incomes of less than $1. 

 This means that one-fifth (21.6 per cent) of all operators in 

 this region live on interest or unpaid labor, or out of capital. 

 It is unfortunate that so high a percentage as one in every 

 five farmers lives not on the current surplus which he has cre- 

 ated by productive labor, but on his family labor and 

 interest on his capital, or by impairing his capital. An oper- 

 ator during his productive life is rarely justified in living on his 

 capital unless he suffers from a destruction of capital or losses 

 due to causes over which he has no control. 



Among those living on their interest are found many of the 

 older men who have worked hard producing commodities for 

 society and accumulating wealth for themselves. Very few 

 question whether these men are justified in retiring and en- 

 joying the results of their labor. Many of these men desire, 

 however, to remain on the farm during the rest of their natural 

 lives instead of moving to town. In general it would probably 

 be better if a farmer of this kind rented his farm to a younger 

 man and lived in a house on the farm instead of continuing to 

 run the place. The farm rented to a young man will usually 

 be operated more efficiently than it would be by an owner who 

 has passed the prime of life. It is hard to vindicate any group 

 of individuals who live on the interest of their farm invest- 

 ments during their productive period, except during times of 

 financial loss due to causes over which they have no control. 



The fact that 2.5 per cent of the operators live on the unpaid 

 labor of the family is evidence that these families are not so 



J In this discussion it must be borne in mind that 5 per cent is the rate used in 

 calculating the interest on capital. That this is a conservative rate hardly seems to 

 need discussion ; but many of the old men who have worked hard and passed the 

 most productive part of their lives are satisfied with less than 5 per cent upon the 

 present valuation of the land. These older men may have secured the land when it 

 was cheap and at its cost price it may now be yielding a good return. In their 

 opinion the land may now be over capitalized. 



