280 Cooperation in Agriculture 



farmers, especially the tenant farmers, secure their credit in 

 this way. While the system is not wholly bad, it is often 

 accompanied by the gravest abuses. By the manipulation 

 of the crop, the unscrupulous dealer can keep the farmer 

 indebted to him continuously. The farmer may lose his 

 independence, he is under the control of the dealer who 

 handles his crop, and he often pays an enormous rate of 

 interest indirectly as a result of the way in which his 

 crop is manipulated by the dealer. Under the chattel 

 mortgage system the farmer may be prevented from mak- 

 ing permanent improvements on his property, and he is 

 likely to be in a condition of continual financial slavery 

 to the unscrupulous agents who handle his business. 

 Unless the crop is an unusual one and the prices are 

 abnormally high, he may never be lifted out of debt. 



The Store Credit System 



Under the store credit system, of which there are many 

 forms, the store gives the farmer the right to purchase the 

 fertilizer, tools, feed, wagons, and other necessities needed 

 in the household or on the farm. This form of credit is for 

 current expenses and not for permanent improvements on 

 the property. The storekeeper does not often loan money, 

 though sometimes the farmer can secure direct loans 

 by giving a crop lien or other form of chattel mortgage 

 as security. If the character of the farmer is good 

 and the risk reasonably safe, the credit may not need 

 to be secured, and the bills that have accumulated at the 

 store during the season are paid when the crops are sold. 

 Where the reputation of the farmer is less certain and 

 the risk correspondingly greater, and where the methods 



