114 



reason, but not sufficiently strong to account for it al- 

 together, since for the most speculative of commercial 

 enterprise money abounds. Neither can the absence of 

 commercial integrity be advanced, for farmers are no- 

 toriously honest. 



One explanation is the somewhat reduced profit of 

 the business, since the demand is for cheap money, and 

 this pre-supposes a small profit for the borrower and 

 little interest for the lenders of the money, unless they 

 are able to add to the legitimate interest of the money 

 advanced, an additional gain through other operations 

 in connection with the business. 



CAPITAL AND PRODUCTION, 



Credit exists for the cereal farmer, he monopo- 

 lises one fifth of the total credit of the country, there- 

 fore it is not a question of credit insufficiency, but 

 rather of the means by which it is accorded. 



The remedy, apparently so easy to advocate State 

 credit direct to the farmer, is out of question; under 

 the most favourable of circumstances the participation 

 of the State cannot cover more than one hundredth of 

 the sum required. Credit extended in one form or an- 

 other for agricultural purposes, apart from that ac- 

 corded the farmer by the land owner, amounts annu- 

 ally to over 2000 million pesos paper. No State, how- 

 ever rich, could undertake to monopolise credit for agri- 

 cultural purposes . 



The theory of credit is based on the facilities for 

 repayment. By .facilitating matters so that repayment 

 is eas3', the greatest step towards securing credit on 

 good conditions is made. The essential thing then is to 

 afford the farmer the good conditions, the facilities for 

 repayment from the adequate returns on the money ad- 

 vanced him, and a profitable margin over and above 

 all for himself. 



In my opinion then the persistent call of the farm- 

 er for money loans or credit to work his business are 

 not so much due to the faults of his ways, or to his ab- 

 sence of true capital, but to the haphazard and defi- 

 cient way in which additional capital, or money, is ob- 

 tained by him, when compared to the sound and orderly 

 organisation which prevails when similar credits are 

 demanded for purely commercial purposes. 



