968 READINGS IN RURAL ECONOMICS 



rather than of the borrowers and that it was inadequate to afford 

 the needed relief. It was claimed that the Bathrick Bill had the 

 support of the farmers' organizations. The hearings also brought 

 out the fact that the Moss-Fletcher Bill by no means met the 

 unanimous approval of the members of the Commission. The 

 upshot of the matter was that the Moss-Fletcher Bill was with- 

 drawn and the Committee on Banking and Currency gave out 

 the statement that an expert had been summoned to draw a new 

 bill. This was subsequently introduced under the name of the 

 Federal Farm Loan Act. 



The Federal Farm Loan Bill differed radically from its pre- 

 decessors. It aimed to create a system analogous to the newly 

 established federal bank system. Its administration was placed 

 under the control and direction of the Federal Reserve Board, 

 which was to appoint a Farm Loan Commissioner. Any number 

 of natural persons not less than five might form a National Farm 

 Loan Association, whose application for a charter must be passed 

 upon by the Farm Loan Commissioner. The capital stock of such 

 an association should not be less than $10,000; and this stock 

 might be taken on the Building and Loan Association plan. The 

 cooperative principle was also recognized in the provision that 

 loans should be made to shareholders only. The association was 

 to have the power to make loans on first farm mortgages only, 

 the rules governing the making of the loans following the general 

 lines of the Moss-Fletcher Bill except that no power to issue 

 bonds was granted the association and that appraisal was placed 

 in the hands of the Farm Loan Commissioner. 



The Federal Reserve Board further was to establish as many 

 Federal Land Bank districts as there are Federal Reserve dis- 

 tricts. In each one of these districts there should be organized 

 a Federal Land Bank, with nine directors, three appointed by the 

 board, six elected by the farm associations. Fach association 

 must subscribe for at least $1000 of capital stock of the Land 

 Bank, and each Land Bank must, before beginning business, have 

 at least $500,000 in capital stock. In case a bank failed to get 

 this amount subscribed " it shall be the duty of the Secretary of 

 the Treasury to subscribe the said unsubscribed balance." The 



