NEW DEAL: FIRST PHASES 499 



in the United States. 57 Of this number better than 360,000, or more than 

 one-third of the applicants, were from the nine states of the western Mid- 

 dle West. The greatest number of applications from any single state were 

 filed by the farmers of Iowa 52,299. This figure even exceeded that of 

 Texas, where the applications numbered 50,188. Next in order were Minne- 

 sota with 45,754; Wisconsin with 45,335; North Dakota, 45,239; Kansas, 

 41,593; and Illinois, 38,177. On the basis of applications filed, the farmers 

 of the western Middle West were definitely among the most numerous 

 as well as the hardest pressed. 58 About 90 per cent of the total amount 

 actually lent was used to liquidate prior indebtedness. 59 



Help was also extended to indebted farmers through agreements to 

 reduce the amount of their claims. From May i, 1933, through December 

 31, 1934, there was an aggregate scaling-down of Federal Land Bank loans 

 that amounted to about $75,000,000. There were also interest reductions, 

 extensions, and deferred payments on Federal Land Bank loans. The 

 F.C.A. encouraged the state governors to set up farm-adjustment com- 

 mittees to handle cases of excessive indebtedness that were submitted to 

 them either by debtors or creditors; settlements were negotiated without 

 resorting to foreclosures. Committees were organized in more than 2,700 

 counties in forty-four states and handled successfully over 40,000 cases 

 involving about $200,000,000 of principal indebtedness. Short-term credit 

 was provided, and production-credit associations were organized to serve 

 all parts of the United States and to take the place of the twelve regional 

 agricultural credit corporations set up in the fall of 1932. Emergency 

 crop and drought loans were made available to farmers who could not 

 offer adequate security. 60 



Besides these emergency financing measures, there was developed a 

 complete and permanent credit system for farmers. These lending institu- 

 tions were divided into three groups: long-term credit, short-term produc- 

 tion credit, and credit for farmers' cooperative buying and selling or- 

 ganizations. Long-term loans were secured by first mortgages on farm 

 real estate, and were available through the twelve Federal Land Banks 



57. Second Annual Report of the Farm Credit Administration, 1934 (Washing- 

 ton, 1935), pp. 2-3. 



58. Ibid., p. 92. These figures are from Table 2 in the appendix. 



59. Ibid., p. 3. 60. Ibid., pp. 4-6. 



