THE RURAb NEW-YORKER 
ioe 
1913. 
FARM CREDITS IN THE UNITED STATES. 
No. 4. 
It remains for us in this farm credit 
discussion only to consider what system 
would be best adapted to the American 
people for personal farm credits. The 
principles under which the European 
systems are operated are practically the 
same as we found in the mortgage 
credits. They have two systems, one 
corresponding to our partnership organ¬ 
izations, which over there is called the 
Raiffeisen system, with unlimited re¬ 
sponsibility of membership; the other, 
the corporate system, known over there 
as the Schulze-pelitzsch banks, with un¬ 
limited membership responsibility. These 
societies do a general banking business, 
but they are organized on co-operative 
lines, and each member must hold at 
least one share of stock. The par value 
of their stocks runs from $30 to $-100. 
They accumulate a surplus which can 
be used only to make up losses. Through 
the membership they accumulate quite 
a large basic capital, and they receive 
savings accounts from members and 
non-members and pay interest on them. 
The rate of interest paid depends upon 
the time the deposit is left with the 
bank, but it is paid from the day it is 
deposited to the day it is withdrawn. 
Under the law they may organize with 
limited or unlimited responsibility of 
members. About one-third of these 
banks in Germany are organized with 
unlimited responsibility charters. They 
make short-term loans to members and 
usually require endorsement or .collat¬ 
eral, though they sometimes loan on cur¬ 
rent account. In these current accounts 
the members decide how much the bank 
can safely loan to any particular mem¬ 
ber, and then he is allowed to draw up 
to that amount as he needs it, and pays 
interest only on the amount he uses. If 
his deposits overrun the borrowing, he 
then receives interest on his deposit. 
The principles of these Schulze- 
Delitzsch banks seem to be well enough 
adapted to the American needs. They 
could be organized in neighborhoods re¬ 
moved from cities and large villages, 
and would gather up the idle money of 
the neighborhood, and the people would 
find in these banks a safe depository and 
receive interest on the deposit from the 
time that they were able to leave it in 
the bank. In the meantime the money 
would be used as capital and devoted to 
productive uses in the hands of the 
members of the banks and helping, in 
the production of a new wealth in the 
neighborhood, which is always a benefit 
to all concerned. 
As we are situated now the savings 
of country people must be kept in the 
home where they are idle, and deposited 
in a National bank where they draw no 
interest, or in a savings bank where they 
will draw interest between certain fixed 
periods. This money, representing the 
savings of farmers deposited in National 
banks, cannot be loaned to other farm¬ 
ers on mortgages or on mortgage col¬ 
lateral, because the National laws do 
not permit. The same money deposited 
in savings banks will not be loaned on 
farm mortgages because the savings 
banks do not favor farm mortgage risks. 
There may be cases when this preju¬ 
dice is overcome, but if so they are ex¬ 
ceptional, and the rule is that such loans 
are not made. The savings banks do 
not loan on personal credit. In favored 
sections farmers of standing and re¬ 
sponsibility are, of course, at the pres¬ 
ent time able to get accommodations 
with endorsement or collateral from 
National banks where they carry ac¬ 
counts, but there are many sections far 
removed from National banks, and it 
cannot be said that these banks forrn 
any system adapted to the use of farm 
credits. A National bank was organized 
without any thought to serve the indi¬ 
vidual farmer. The only thought given 
him was apparently that it must not loan 
on farm mortgages. We are not quar¬ 
reling with this provision, because we 
can see sound reasons for it. We have 
no purpose at this time to criticize the 
law under which the National banks are 
organized, or the methods under which 
they do their business. They were or¬ 
ganized to render a service to the manu¬ 
facturing and transportation interests of 
the country. They have rendered this 
service. They were not organized to 
serve the farmer. They are hardly quali¬ 
fied to do it, and in practice they do not 
do it except to a limited extent. It is 
true that there are sections of the Mid¬ 
dle West where farmers deposit freely 
with the National banks, and where 
farmers own the controlling interest in 
them. In some of these sections it is 
said that the banks favor the farmer 
above other interests. This is only nat¬ 
ural enough under the circumstances, but 
instead of being an argument against 
the system of rural banks, it is, to our 
minds, an argument in favor of them. 
It shows that where there is a banking 
system that they can use the farmers 
patronize it and mould it to their serv¬ 
ice, but there are many farm sections 
where a National bank could not be 
formed under the laws governing them 
at present, and in no. event can they 
furnish the facilities that should be af¬ 
forded and can be afforded by properly 
constituted farm credit systems. 
If once established there will be no. 
rivalry between National banks and 
farm credit banks. They would supple¬ 
ment each other, assist each other and 
profit by each other. The farm credit 
bank would gather up and make avail¬ 
able for purposes of production hun¬ 
dreds of thousands of dollars that do 
not now find their way to the National 
banks, and the surplus of these farm 
credit banks would naturally find its 
way to the National banks, while the 
credit afforded to the smaller banks 
would create new forms of credit, part 
of which would be absorbed by the Na¬ 
tional banks by discounting bills at farm 
credit banks in time of need. 
The farmer who is obliged to depend 
upon his storekeeper, implement dealer 
and feed mill for his banking facilities 
knows that he pays pretty well for his 
accommodation, and when he remembers 
the occasions when he is able to go free 
into the market and buy for cash, hq 
realizes the force of the familiar argu¬ 
ment, “Money talks.” The farmer is no 
different from other business men. The 
R. N.-Y. has borrowed money at 5% per 
annum and saved 5% per month on the 
transaction. This is not an unusual ex¬ 
perience for business men. A saving 
of this kind cannot be made by either 
business man or farmer on machinery 
or fertilizers, or other apparatus, that 
are not turned over at frequent intervals, 
but there are many farmersjiuying food 
on monthly credits who probably save 
as much money by discounting their 
feed bills for cash as they make in ac¬ 
tual net profit on the milk produced. 
It is true that many farmers have these 
credit facilities now through the Na¬ 
tional bank, and make use of cash trans¬ 
actions. It is not necessary to speak for 
them. This class of farmer is well able 
to take care of himself. We think it 
will be conceded that there is no other 
paper in this country that represents so 
large a class of these prosperous busi¬ 
ness farmers as are found on the sub¬ 
scription list of The R. N.-Y., and for 
this reason it is sometimes asked why 
we are at so much pains to take up the 
burden of the less favored farmer. To 
be frank with these critics we confess 
that we believe our first motive is bred 
in sympathy and fellowship with the 
farmer who is now struggling with the 
problems, not to say hardships, of the 
farms, as we ourselves have struggled 
in the past. Besides, we believe it the 
best function of a farm paper to do for 
its people the things which they are un¬ 
able to do for themselves, and in this 
we believe that our large army of well- 
to-do and prosperous farmer friends 
share our sympathies, and the approval 
of the work is abundantly expressed in 
the continued support and unsparing 
confidence. 
A farm credit system, however,! will 
benefit no one class in excess of another. 
This is a cardinal principle of co-opera¬ 
tion, and where this function is lacking 
true co-operation does not exist. 
JOHN J. DILLON. 
BUSINESS POINTERS, 
Now that parcel post has started, 
farmers must look about and see how 
successful business men are handling 
small enterprises. Here and there we 
find individuals selling food products in 
competition with the big monopolies and 
getting their share. That is because 
they have what Carl Schmitt in “The 
Child” called “a patent of nature.” For 
example, a society near New York sells 
“Straight Edge Bread,” made of whole 
wheat. Here is part of the certificate 
which goes with each loaf: 
Etas not been pawed over by horsey¬ 
smelling teamsters, nor ieft about exposed 
to dust and dirt on doorsteps, sidewalks 
or store counters, but was taken with clean 
hands from the baker’s table and sealed in 
waxed paper to insure its cleanliness and 
freshness; that it does not dry up and 
become stale the day it is baked, but is 
better the next day and still better the 
next —because alum, ammonia and other 
harmful chemicals commonly used to make 
an armful of baked bubbles for almost 
nothing are omitted. The cooperative labor 
and first-class materials put into it and 
the hygienic conditions under which it is 
baked make it worth 10 cents. 
That is the sort of thing which helps 
make the “patent.” 
One of our Maine readers, Mrs. Jean¬ 
ette S. Rogers, is trying to revive an 
apple orchard. The marketing problem 
is hardest, but as a help she sells 
through a local store and advertises in 
the town papers. Here is a reduced 
copy of part of one advertisement. 
Q not Q 
APPLES 
The Q not Q has taken the Agency for tho fam 6 u 9 
Rogers* Apples, grown on the farm of Mrs. J. S. Rogers at 
North Newburgh. These apples are raised, packed and 
wrapped by apple experts and arc by far the finest apples 
lever offered for sale at this store, Oregon Apples NOT ex¬ 
cepted. Rogers* Apples come packed in spotlcssjy clean 
bushel boxes, each apple being wrapped in a dainty sanitary, 
wrapper. Fifty to sixty per cent, better in quality. 
The real genuine MAINS APPLE taste. No more Oregon 
Apples on sale at the Q not Q. Seven varieties of Rogers* 
Maine Apples in stock for Saturday, viz: Honey Pinks, 
Baldwins. Kiftgs, Snows, Fallawatcrs, McIntosh Reds and 
Mildings, (Gravenstcin Typ*). 
There are thousands of farmers who 
might well use their local papers to sell 
goods. 
Free Advertising. —In some of the 
\\ estern cities the large daily papers 
have encouraged parcel post dealing by 
offering free advertisements to farmers. 
Here is part of a notice printed in the 
Cincinnati Post: 
So The Post is going on the job as a 
master of ceremonies to introduce you per¬ 
sonally to each other. Here’s our plan : 
The Post is read by 90 per cent, of the 
people of the city, Mr. Farmer. We intend 
to priiit your name with a statement of 
what you sell and your postoffice address 
for six days, free. We are not recom¬ 
mending you to anybody. You’ll have to 
do that with your produce. But we are 
going to give our thousands of readers a 
chance to test the parcel post in a most 
practical way, to determine whether or not 
it really will reduce the High Cost of 
Living. We want you to write your name 
on a post card, with a statement of what 
you have to sell and your address, thus : 
John Smith, Box 10, R. F. D. No. 6, 
Batavia, O. Eggs, Butter, Bacon. 
That’s all. .Tust write that on a post 
card and sent it to The Post’s Parcel Edi¬ 
tor. We will print that Absolutely Free 
for six days where every one of our readers 
can see it. If they want anything you 
have to_ sell, they will communicate with 
you. We want our readers to know who 
you are and where you can be reached. 
Get together. You ought to be good 
friends with profit to each of you. 
The object of this is to encourage 
direct dealing between producer and 
consumer, and we understand that con¬ 
siderable trade was started in this way. 
Eggs and Butter.— The worst com¬ 
plaints we have yet heard about our 
American parcel post are in regard to 
egg and butter shipments. The rates 
are too high to make any but the finest 
of eggs on short routes'profitable, and 
there is some breakage. These things 
will be remedied in time. Consul Skim¬ 
mer at Hamburg, Germany, has sent the 
following regarding the German system: 
The parcel post service of Germany is 
used to a very large extent by farmers 
in their dealings with city customers, and 
especially for delivery of butter and eggs. 
Butter thus shipped is wrapped first in 
parchment paper and then packed in a 
cardboard box. As a rule, shipments under 
10 pounds are not made, each pound being 
separately wrapped, the total shipment in¬ 
cluding nine pounds of butter, net. These 
pasteboard butter boxes come with an 
upper and lower part and are folded to¬ 
gether and fastened with metal clamps to 
make the finished box. In knocked-down 
condition these boxes can be had in this 
country for §23.20 per thousand for the 
best quality and $21.42 for the second 
quality. The boxes can be saved and used 
over again. The clamps cost 33 cents per 
thousand. 
Eggs are shipped either in strong card¬ 
board or wooden boxes, the inside of which 
contains corrugated cardboard partitions 
forming squares large enough to receive 
one egg. Between each layer of cardboard 
partitions a sheet of cardboard is placed. 
The wooden boxes are rather attractively 
finished and cost at retail 95 cents each. 
They are provided with a padlock and neat 
cover, and can be used for an indefinite 
period. Pasteboard egg boxes containing 
partitions for 10 eggs can be had for 
$45.22 per thousand, and boxes to contain 
24 eggs for $71.40 per thousand. 
Retail Credit.— I have watched with 
interest your campaign for parcels post, 
and now that we have it I rejoice with 
you; it is certainly good, if for nothing 
else than to compete with express com¬ 
panies in shipping of small packages. 
But this talk from several sources of 
using it for the delivery of farm prod¬ 
ucts seems to me to be something of a 
joke; aside from anything else, who is 
going to collect? It is all very well to 
talk of receiving ’phone or mail orders 
and filling them by mail, but who is 
going to get the money? I am a pro¬ 
ducer of high-grade dairy and poultry 
products, which I sell entirely to high- 
class retail trade, and it seems to me 
from experience where goods are de¬ 
livered in person that delivery by post 
is out of the question except to a few 
known people who are willing to pay 
that extra 10 or 12 cents on a dozen 
eggs, etc., and are known to be good 
pay. In my business I have found this 
a pretty good rule to go by: “Every 
consumer is a dead beat until he has 
proved he is honest, and then don’t trust 
him too far.” The parcels post is a big 
thing to the farmer, but before he starts 
to use it for a delivery wagon let him 
look into what he has yet had little 
experience with and what will loom 
larger when he tackles it—“retail credit.” 
Nyack, N. Y. t. h. l. 
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1 " 
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Name. | 
Town. I 
R.F.D.State. 
WATERLO'C BOV 
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