? AGRICULTURAL DISCONTENT 



permanent support of their members. The most novel of the innovations 

 was the "maintenance" or "penalty clause," which provided that any 

 member who sold to a private dealer was required to compensate the 

 cooperative elevator by paying into its treasury a specified sum, usually 

 from one-half to one cent per bushel on all grain sold. At least four Iowa 

 farmers' elevators are known to have adopted such clauses during the 

 eighties and nineties: one in Marcus in 1887 and three others in Rock- 

 well, Rockford, and Rock Valley in 1889, 1891, and 1892, respectively. 

 The object of the penalty clause was to bind the farmers to their own 

 elevators, and to some extent it seems to have succeeded. In spite of the 

 continued opposition of the line companies and the hard times of the 

 iSgo's, the cooperative movement endured. In Iowa alone it has been 

 estimated that between 1897 anc ^ I 93 fr m two to seven elevators were 

 organized each year, despite the persistent and well-organized opposition. 46 

 The success of the cooperatives in dealing with their opponents is well 

 illustrated by events that transpired in Iowa following the organization 

 in 1900 of the Iowa Grain Dealers' Association. This association provided 

 for a union of forces between the independent dealers and the line com- 

 panies, who together considered themselves entitled to the entire grain 

 business. Through the association these two groups entered into agree- 

 ments over prices and the sharing of all available business. But the farmer 

 cooperatives were quick to retaliate. Meeting in Rockwell in November, 

 1904, the representatives of seventeen farmer elevators launched a counter- 

 association known as the Iowa Farmers' Grain Dealers Association. The 

 object of this new agency was to assist farmers who wanted to handle 

 their own grain business in the formulation of suitable by-laws and in 

 the adoption of sound methods of operation. The success of its propaganda 

 is attested by the fact that the number of farmer elevator companies in 

 Iowa grew from 30 in 1904 to 511 in 1921. Aid of various kinds was offered 

 by the state association: legal advice, commercial information, an audit- 

 ing service, information regarding competent managers, advice on the 

 selection of elevator sites and the erection of buildings. As the farmer eleva- 

 tors grew in numbers, their bargaining strength won them better treat- 

 ment from the railroads and from terminal purchasers. They also had a 

 large part in the passage of the Iowa cooperative law of 1915. By 1913 



46. Ibid., pp. 241-46. 



