RURAL CREDITS 713 



world and the relatively unmarketable form in which his securities 

 were presented. Now that agriculture is taking its place in the busi- 

 ness world on an even footing with other industries, the farmer must 

 learn to compete with other users of capital. The growth of small 

 country banks, aided now by the federal reserve system goes far 

 toward giving him an adequate machinery for personal credit or 

 short time loans. The Federal Farm Loan act provides an essentially 

 similar and thoroughly American device for making the invest- 

 ment capital of the whole country accessible to the farmer for land 

 mortgage purposes. If this machinery can be coupled up with vigor- 

 ous, self-reliant, and co-operative activity on the part of those who 

 need credit in their agricultural enterprises, we may hope, in time, 

 to see a large part of the difficulties of this transition era disappear. 



A. The Coming of the Rural Credit Problem 



231. AGRICULTURAL DEPRESSION AND THE INCREASE OF 

 FARM MORTGAGES 1 



BY J. R. ELLIOTT 



Probably no better proof of the loss of the farmer's relative capital 

 power is required than in his growing dependence for his capital on 

 the successful men of other occupations. And it certainly is an 

 unquestionable indication of coming disaster, if this demand for aid 

 by the farmer be growing faster than the increase in the value of his 

 possessions. Fifty years ago farm mortgages were rare in America; 

 today they are the rule in many localities and everywhere they 

 threaten to defy the farmer's efforts to contend with the load they 

 create. 



It is claimed of New England that at least 333 per cent of the 

 farms are mortgaged to the capitalists. Few undertake to deny this 

 startling declaration. In fact, it is generally admitted. Mr. Heath, 

 Commissioner of Labor Statistics of Michigan, has recently reported 

 on the mortgage indebtedness of the farmers of his state. He stated 

 that he has reports from 90,803 farms, or 58 per cent of all the farms 

 in the state. The assessed valuation of all farms reported is $194,- 

 854,663, upon which there is a mortgage indebtedness of $37,456,272, 

 or a little more than 19 per cent of the total assessed valuation, and 



x Adaptec 1 from American Farms, Their Condition and Future, pp. 45-52. 

 (G. P. Putnam's Sons. Copyright by J. R. Elliott, 1890.) 



