CAPITAL 301 



It has become so much a live issue that the national 

 political parties have included it in their platforms, and 

 without doubt something will be done in the near future to 

 establish either public or private institutions from which 

 farmers may make loans on favorable terms. 



Unless the farmers take a hand in this, the financial 

 interests of our country are likely to shape such institu- 

 tions to suit their interests first and the farmers' interests 

 second. Already there are suggestions of a large central 

 land bank with almost unlimited capital for financing 

 farmers, of land mortgage associations with like gigantic 

 capital to handle loans on farm real estate. But there are 

 some fundamental factors concerned in the matter that 

 must be observed if a system is established that will give 

 the relief that is necessary and proves the success that 

 similar institutions have proven in European countries. 



FIRST : Farmers must be represented in its manage- 

 ment and control. The German agricultural credit or- 

 ganizations, which are the best in the world, are managed 

 by farmers and for farmers. They are literally a union 

 of the farmers for the farmers and by the farmers. Bankers 

 and financiers can cooperate and assist such organizations, 

 but they cannot do for the farmers what they must do for 

 themselves. 



SECOND : Farmers' credit organizations must be on a 

 limited liability, basis. For that reason the Raiffeissen 

 system which is so widely distributed in Europe and by 

 many advocated for introduction in America is not appli- 

 cable to our conditions, because the one thing on which 

 Raiffeissen built his association was the unlimited liability 

 of members. It was literally " one for all and all for one." 

 The American farmer will not become a member of an 

 association by which he makes himself liable for all of 



