AGRICULTURAL DISCONTENT 



convinced even the most enthusiastic exchange supporters that their ter- 

 minal livestock-marketing operations were either ill advised or misman- 

 aged, or both. 83 



The war years witnessed a rapid growth in the grain business of the 

 exchange. New elevators were built or acquired, the number of stock- 

 holders was increased, and the financial reports presented favorable ac- 

 counts of the progress of the organization. By midyear of 1922, the ex- 

 change owned eighty local elevators fifty-two in North Dakota, two in 

 South Dakota, and twenty-six in Minnesota. The exchange also operated 

 twelve local cooperative elevators for farmer groups that either were un- 

 able financially to operate themselves or else preferred to operate as part 

 of a large marketing organization. 86 



The stockholders' report for 1922 hinted that the financial condition 

 of the exchange was not so healthy as previously claimed. Then, in the 

 following year, the ugly rumors that circulated were confirmed. The 

 capital stock of the exchange had been impaired to the extent of $750,000; 

 money that had been obtained from the sale of the grain in the pool of 

 1923 had been diverted to the general business of the exchange; and a 

 substantial amount of pool money had not been paid to the stockholders. 

 Some fifteen elevators were located in territory that was not essentially 

 grain-producing. 87 



Poor business leadership was the most important single reason for the 

 decline of the exchange. Beginning with the time when one of its man- 

 agers did not know enough to keep his personal accounts separate from 

 those of the company, through the period when the business policies of 

 the exchange had oscillated between "applied Christianity" and progres- 

 sivism in politics, down into the unhealthy expansion of the war period,, 

 the history of the exchange was one long procession of errors. 



Psychologically also the management of the exchange was handicapped. 



85. Equity News, March i, 1915, p. 714. 



86. Montana Equity News, April 17, 1919; Ralph L. Harmon to Austin P. Haines y 

 September 9, 1919, in the possession of R. L. Harmon of South St. Paul. See also- 

 H. B. Price, "Farmers' Cooperation in Minnesota, 1917-1922," University of Minne- 

 sota Agricultural Experiment Station, Bulletin 202 (St. Paul, 1923), p. 35. 



87. Equity Cooperative Exchange, Statement by the Board of Directors (Fargo, 

 N. Dak., 1922), p. 3; Equity Cooperative Exchange, Twelfth Annual Stockholders 

 Convention, January 16-17-18, 1923. 



