246 AGRICULTURAL DISCONTENT 



states, grain, livestock, oil, and farm and household supplies were han- 

 dled successfully and in growing quantities by cooperatives. 



One of the first major business enterprises of the Farmers' Union in 

 the Northwest was acquired full grown when the Iowa Farmers' Union 

 took over the old livestock branch of the Equity Cooperative Exchange 

 in South St. Paul, and then transferred its ownership to the Unions of the 

 northwest states. The volume of business transacted by this firm never 

 was great, yet it attracted much attention because of the policy it adopted 

 with reference to patronage dividends and because of its quarrel with the 

 Central Cooperative Livestock Commission Association, also of South 

 St. Paul. 



It will be recalled that the Northwest Committee had announced that 

 the patronage dividends which it normally would pay to its patrons would 

 be withheld to promote the organizational and educational activities of 

 the Union. Patronage dividends were also employed, in part, to pay for 

 the building purchased from the defunct Equity Cooperative Exchange. 

 When this policy went into operation in 1926, the immediate effect was 

 a drop in the patronage of the firm, especially among those farmers who 

 shipped to the agency but did not belong to the Union. 66 



The quarrel between the Union house and the Central Cooperative 

 represented a good deal more than the rival ambitions of two competitive 

 firms. The Central Cooperative, supported as it was by the Minnesota 

 Farm Bureau and the extension division of the University of Minnesota, 

 adhered to the basically different point of view from that held by the 

 Farmers' Union and accepted by its agency. The Union maintained that 

 the solution to the farm problem would best be reached by one centraliz- 

 ing force in this case the Union to which all the different commodity 

 organizations should belong. The Central, on the other hand, was simply 

 a single commodity organization and was content to operate by itself 

 alone. The Union insisted that the farmers would obtain a better price 

 for their goods only when they, as producers, were strong enough to 

 control the flow of their commodities and so to fix their own prices. The 

 Central, while conceding that such a situation might be ideal, maintained 

 that it would be impossible to achieve. The Union agency, by virtue of 

 the fact that it was the successor to the Equity house, the oldest marketing 



66. Farmers' Union Herald, June, 1927. 



