GENERAL FARM PROGRAAI 391 



Mr. CooLET. You "would not want tliem to liave loans unless tliey 

 could meet those minimum requirements, would you ? 



Mr. Talbott. May I suggest that I believe directly and indirectly 

 I could answer your question, Mr. Congressman, in just a moment, 

 with the following suggestion. There are many areas where there 

 are existing cooperatives where they have the management, know- 

 how, and the capital base where expansion of facilities could be car- 

 ried on through loans and that would undoubtedly be done in the 

 banks for the cooperatives. 



But there are areas where storage facilities are needed, where there 

 is no knowledge among farmers' cooperatives. 



They do not have the management or the know-how, and undoubt- 

 edly tliere are areas where they do not have the capital to meet the 

 40 or 50 percent requirements for the cost of facilities and the addi- 

 tional requirement for operating capital. 



I should like to call the attention of the committee to the record 

 of the Rural Electrification Administration, not to analyze that, but 

 for this purpose : Insofar as anyone can determine, the funds loaned 

 by the Rural Electrification Administration have not resulted in any 

 losses or even prospective losses to the Federal Treasury. 



There are loan funds. They are organizations which are directed 

 by the Congress to be promoted in their organization by the REA 

 and areas where people do not have the know-how, management, 

 training, supervision, the technical studies and all of that to organize 

 the REA cooperative, and 100 percent facility loans and capital to 

 be paid back over a long period of years at a reasonable interest rate. 



Mr. CooLET. The REA is the only agency of the Government mak- 

 ing those loans. We have the Bank for Cooperatives created for the 

 very purposes of making loans to cooperatives. If we have that 

 facility and the funds available, why would you suggest giving the 

 Commodity Credit Corporation the identical power to make identical 

 loans ? 



Mr. Talbott. It was our thought that the reason for thinking in 

 terms of the Commodit}' Credit Corporation was that this deals with 

 the storage of agricultural commodities and that relates itself to 

 the whole problem of the Department of Agriculture, the building 

 of reserve stocks and all of the rest of it. 



Mr. CooLEY. That is just one activity of a cooperative. They have 

 other purposes. Every farm cooperative may embrace the rights 

 of storage. If you have an agency of the Government, let us not 

 create any new areas. 



Mr. Talbott. But there are many areas of the country where there 

 are not existing cooperatives with a capital basis. 



Mr. CooLET. It may be that the farm leaders of this country have 

 not educated the farmers. The Government is ready and willing 

 to help them through an existing gency. To create another agency 

 is not going to inform the farmer any more than he is informed 

 right now. 



]Mr. Talbott. May I submit. Mr. Congressman, that if we had 

 merely set up loan funds for the Rural Electrification Administration 

 in 1935 and merely said to the public at large if farmers wanted to 

 get together and organize a power distribution coperative and if they 

 want to find and train the technical people and management, then 



