AGRICULTURAL CREDIT IN THE UNITED STATES 967 



to issue debenture bonds against rural real-estate mortgages for 

 a period not exceeding thirty-five years. Bonds were to be issued 

 only against loans running for more than five years. The bond 

 issue was limited to fifteen times the capital and surplus of each 

 bank and was to be secured by first mortgages on farm lands 

 located in the state where the bank was situated. An attempt 

 was made to give standing to the bonds by making them legal 

 investment for time deposits of national banks and of savings 

 banks in the District of Columbia and for trust funds and estates 

 administered by the United States courts, and by providing that 

 they might be used as security for loans from national banks to 

 national farm land banks or to individuals. The value of the 

 mortgages was to be at least equal to the par value of the bonds 

 outstanding. The rate of interest charged for the loan should 

 not exceed the rate on the bonds by more than 1 per cent, which 

 should cover all administration charges. The bill also prescribed 

 the purposes for which loans might be secured : (a) to "complete 

 the purchase of agricultural lands mortgaged; (b) to improve and 

 to equip such lands for agricultural purposes ; and (c) to pay and 

 discharge debts secured by mortgages or deeds of trust on said 

 lands." Loans were not to exceed 50 per cent of the value of 

 improved farm lands, or 40 per cent in the case of unimproved 

 land. The appraisement was to be made by a committee of three, 

 appointed by the board of directors from their own body. 



Numerous other bills were also introduced at about the same 

 time as the Moss-Fletcher Bill, among which the Bathrick Bill 

 deserves attention. This provided for loans by the government, 

 at a rate not to exceed 4^ per cent, to farmers direct or through 

 farm credit associations which should become surety for all mort- 

 gages made through them. The government was to borrow, at a 

 rate not to exceed 3 * per cent, the funds to be used for this pur- 

 pose ; and the distribution of such funds was to be made by 

 a bureau to be established in the Department of Agriculture. 



Extensive hearings on the Moss-Fletcher Bill were held, 

 during which the impression gained ground among members of 

 Congress that this was not radical enough to satisfy the farmers, 

 that it was a bankers' bill drawn in the interest of the lenders 



