52 ECONOMICS OF LAND TENURE IN GEORGIA [52 



prosperous. Most of them did not make any entrepre- 

 neur's profit; many of them not only failed to make nor- 

 mal returns to labor and capital, but even sank in the 

 business much of the capital with which they began the 

 period. This capital was sunk in two ways: one has 

 just been described at considerable length; the other 

 was in the nature of a decline in the value of the land. 



Since 1898 the situation has materially improved. The 

 farmers in general and the landowning farmers in par- 

 ticular are now in much better economic condition than 

 they have been for many years — in fact their condition is 

 better than it has been at any time since the war. Three 

 important influences have contributed to the bringing 

 about of this result: the Farmers' Alliance movement, 

 the increase in the number of country banks, and the 

 higher prices that have prevailed in the cotton market 

 since 1898. These influences will be considered in the 

 remaining parts of this chapter. 



In order to appreciate the full significance of the Alli- 

 ance movement it is necessary to refer again to the 

 credit system for the purpose of directing attention to 

 one aspect of it thus far not mentioned, although in reality 

 it is the essential feature of the system, and has, there- 

 fore, played an important role in the breaking-up of the 

 old plantations — a process whose outward manifestations 

 were described in connection with the operation of the 

 lien laws. Reference is made to the conspicuous differ- 

 ence between cash and "time" prices in the credit ar- 

 rangement. It is this difference between cash and credit 

 prices that has caused the system to bear so heavily on 

 the farmers of the state. The procedure by which this 

 comes about will now be described. 



At the beginning of each year the farmer resorts to 

 the merchant, with whom he negotiates for a line of 



