1914. 
THE STORY OF A CO-OPERATIVE SUCCESS. 
Part I. 
[At the recent meeting of the New York State Agri¬ 
cultural Society, Mr. L. G. Tucket-man read a strong 
paper giving a history of the Hudson River Valley 
Exchange. We are very glad to give it here.] 
THE BEGINNING.—In March, 1912, C. E. Thurs¬ 
ton of New York and W. Y. Yelie of Marlborough, 
called upon number of farmers in the district from 
Newburgh to Highland to discuss a plan for coopera¬ 
tion among the fruit growers of the Hudson River 
Valley with a view to improving our marketing con¬ 
ditions. The result of their efforts was a meeting 
of some 40 men in Milton, when the subject was 
discussed, and a committee of live appointed, of 
which I was one, to draft a constitution and by¬ 
laws for a cooperative association, and report at a 
meeting a fortnight later. The committee finally 
adopted the following preamble: 
The object of this exchange shall be to encourage the 
cooperation of the fruit growers of the Hudson River 
Valley for the protection and advancement of their com¬ 
mon interests. 
1. By securing and disseminating such scientific and 
practical information as shall promote the general ad¬ 
vancement of the fruit-growing interests in this district, 
and shall tend to the improvement of the quality and 
quantity of our products. 
2. By securing such legislation ns may be advan¬ 
tageous and preventing that which may be detrimental. 
3. By securing such improved facilities in transporta¬ 
tion as shall tend to give us more expeditious and 
economical distribution of our products. 
4. By endeavoring to secure a better and more uni¬ 
form system of packing and package. 
5. By devising some system of marketing our 
products, as shall open up and develop markets, and 
to give the growers a fair and remunerative return. 
(j. By endeavoring to obtain such improved system of 
crop reports as shall furnish accurate information con¬ 
cerning production, thereby enabling the fruit growers 
to know the exact situation. 
7. By cooperative purchase of such supplies as are 
needed by the members. 
FORMING THE COMPANY.—We determined 
that it would be advisable to incorporate a company, 
venturing slowly, as this was a new deal to us all. 
We set the capital stock at $2,000, divided into 100 
shares at $20 each, no member to own more than 
four shares. Stock does not carry voting power. 
Each registered member has one vote only in the 
Hudson River Fruit Exchange, Inc. The government 
is vested in an executive committee of five, who were 
chosen in 1912, one for three years, two for two 
years, and two for one year. As these terms expire 
members are elected for terms of three years. We 
thus always have three men familiar with the work. 
This committee annually, from its members, ap¬ 
points the officers for the year. All are subject to 
recall by the exchange. Three articles of the by¬ 
laws should be read in full: 
Art. VI. Members of this Exchange bind themselves 
when consigning fruit, to ship only to commission 
houses or auctions duly designated by the Exchange. 
They also agree to ship all fruit up to grade under the 
label of the Exchange, and fruit not up to grade with¬ 
out the label. 
Art. VII. Fruit sold through the Exchange f. o. b. 
shipping point or on track shall pay ro the Exchange a 
commission of 3 per cent, of the gross price. In such 
cases the Exchange stands behind such sales and guaran¬ 
tees the price to the grower. The members reserve 
the right to negotiate private sales on which no com¬ 
mission shall be due the Exchange. 
Art. XIII. At the end of each fiscal year, after all 
the expenses of the Exchange shall have been paid, the 
executive committee shall from any surplus remaining, 
declare a dividend not exceeding five per cent, on the 
par value of shares issued. The entire balance of such 
surplus shall be distributed among the members who 
have shipped fruit through the Exchange during such 
year in proportion to the value of their respective 
shipments. 
The last sentence of Art. VII caused much dis¬ 
cussion. and many members feel that it should not be 
in. and we have made efforts to have it removed, but 
I regret to say that it still stands. I shall take up 
this matter later on. 
STARTING THE WORK.—It was May before we 
were incorporated and ready to begin work. As 
secretary-treasurer, it devolved upon me to find a 
manager. Answers to advertisement were varied 
and curious, but a man in Minnesota seemed to fill 
the bill, though many members felt that anyone 
totally unacquainted with this region would never 
do. But this man’s references were so good and his 
letters were so clean cut that 1 wired him to come 
on, and we hope he will never leave us. I tell you 
this because the manager is the heart and soul of 
any cooperative concern. It was June when he took 
hold, an utter stranger in' the community, with 30 
scattered members willing to try an experiment. 
That was about the size of it. But the manager 
hustled. Our commission men were chosen with a 
view to concentrating our shipments to prevent 
competition with ourselves and to let buyers know 
just where oiy fruit was to be found. The houses 
chosen were naturally men we were used to and 
had confidence in. The custom in our section has 
been for such houses to pay their agents three of the 
10 per cent, charged the farmer for selling. We 
THIS RURAL NEW-YORKER 
arranged with most of our houses that the Ex¬ 
change be made agent and receive that three per 
cent, on all produce consigned by members of the 
Exchange. That was to be our source of revenue. 
MARKET REPORTS.—Mr. Hilderbrand, our 
manager, arranged to supply complete market re¬ 
ports to our members each morning by ‘phone. 
Until then few of us had been able to get any re¬ 
liable reports, and the custom of the many local 
buyers had been to use this ignorance very much 
to their own advantage. For instance, those buyers 
receive from their houses in berry time 10 cents 
per crate for buying, and each morning receive word 
as to what they shall pay, let v»s say, for straw¬ 
berries that day. Supposing the price given them 
be 10 cents per quart. Under the old system the 
buyer paid what he could make the grower accept, 
and pocketed the balance. The Exchange entered 
the field and paid the full daily price as well as 
giving complete market reports, with the result that 
for the first time in our section the local price of 
berries was kept on a par with the wholesale prices 
in the Eastern markets. This made men take notice, 
and in spite of the hardest kind of knocks from 
buyers and outside commission men we began to 
receive applications for membership. 
THE NEW CURRENCY LAW. 
Part I. 
[We have had many requests for a synopsis of the 
new currency law. The following has, therefore, been 
prepared.] 
“An Act to provide for the establishment of Fed¬ 
eral reserve banks, to furnish an elastic currency, 
to afford means of rediscounting commercial paper, 
to establish a more effective supervision of banking 
in the United .States, and for other purposes.” “The 
Federal Reserve Act,” to use its short title, was ap¬ 
proved by President Wilson. December 23, 1913, and 
was the Administration's Christmas gift to the 
American people. Within five weeks over 5,000 
national banks have notified the Government of their 
desire to become a part of the new banking system. 
Only five banks in each of our two largest cities 
remain to be heard from in favor «»f becoming mem¬ 
bers. The largest bank in the United States, the 
National City Bank of New York City, having a 
capitalization of nearly $300,000,000, has asked for 
membership. To date only two national banks have 
declined to join. It now seems certain that the 
combined banking systems of the country will soon 
be members of a system of banks that will exceed 
that of the combined capital of the Bank of England, 
Bank of France, Bank of Germany, and Bank of 
Russia. 
FEDERAL RESERVE BOARD—The new bank¬ 
ing system is to be controlled by a Federal Rese- e 
Board of seven members, the Secretary of the 
Treasury and the Comptroller of the Currency of 
the United States to be members ex-officio. The five 
members are to be appointed by the President of 
the United States by and with the consent of the 
Senate. The salaries are to be $12,000 a year and 
necessary travelling expenses. The first board is 
to lie appointed for terms of two, four, six, eight and 
10 years, and thereafter for terms of 10 years. Their 
sal a ries and expenses are paid by the Federal Re¬ 
serve banks. Each member is to devote his entire 
time to the duties of the office, and cannot hold 
office in any bank at the time nor for two years 
thereafter. The Federal Reserve Board is author¬ 
ized to examine the accounts, books, and affairs of 
the Federal Reserve banks and the member banks; 
to publish a weekly statement of the condition of 
Federal Reserve banks; to permit or require Federal 
banks to rediscount paper of the member banks and 
fix the rates of interest: to supervise the issue and 
retirement of Federal reserve notes; to suspend or 
remove any officer or director of any Federal bank; 
to require the writing off of doubtful assets of Fed¬ 
eral banks; to suspend the operations of any bank 
for violating the provisions of the currency law; 
and to exercise general supervision over the Federal 
Reserve system. This Reserve Board is similar to 
the Interstate Commerce Commission in several re¬ 
spects, but has a larger degree of control. 
FEDERAL RESERVE DISTRICTS, CITIES AND 
BANKS.—The United States is to be divided into 
not less than eight nor more than 12 districts which 
are naturally the banking territories of from eight 
to 12 large cities. In each of these cities is to be 
established one Federal bank. The Federal Reserve 
districts are not made with any regard to State 
lines. No Federal Reserve bank can have less than 
$4,000,000 subscribed capital stock with which to 
begin business. The new system is being organized 
by an “Organization Committee,” composed of the 
Secretary of the Treasury, the Comptroller of the 
Currency, and the Secretary of Agriculture.” Every 
national bank in the United States and every eligible 
State bank or trust company must signify in writing 
before February 20 its acceptance of the terms and 
provisions of the new law. The National banks 
that fail to come into the system lose their national 
charter. Each bank coming into the system is called 
a “member” bank, and is required to subscribe to 
stock in the Federal Reserve bank of the district 
in which it is located. Each bank must take stock to 
an amount equal to 0% of its capital and surplus. 
Individuals and corporations may take stock not to 
exceed $25,000 in amount. If the amount subscribed 
by banks and individuals and corporations is not 
deemed sufficient by the Organization committee 
then the committee allots to the United States the 
balanced required. p. n. c. 
ANOTHER FORM OF DIRECT TRADE. 
I am not a farmer, but have taken your paper for 
some years to keep me good-natured after riding home 
in the Subway at 6 p. m. I have seen a great deal 
in The R. N.-Y. about that 35-cent dollar the farmers 
are getting, or sometimes no dollar. Wh6re I am em¬ 
ployed thei-e are 15 married men who are fond of good 
food and fair prices for the same. I have a crate of 
eggs sent to me every Monday, another man potatoes 
and butter. They are all taken at the farmer’s price, 
plus the express or freight. The farmer gets his money 
right back, we save the middleman’s profit, and what 
we get is A-l. I would say anyone can do the same. 
A church might help its congregation that way and 
make a little something. At first the concern found 
fault because as soon as a crate of eggs came every¬ 
one quit work to get his, but the manager soon fell in 
line, and now asks when the next crate is coming. I 
get my eggs from Vermont, and the express is only 53 
cents on a crate. Farmers could combine and get all 
there is in it this way, and not wx-ite your paper to 
collect bad debts for them. G. II. MORSE. 
New York. 
We print this as showing another way to direct 
trade. In this case it is cooperative buying rather 
than selling. Workers in a city factory or store 
combine and buy in wholesale lots. The goods are 
distributed here—each man carrying home his own 
share. As Mr. Morse says, this gives the consumer 
fresh goods at a fair price, while the shipper has a 
sure trade with the middleman’s tax added to what 
he could otherwise obtain. The suggestion that 
churches, clubs and other city societies could use 
their organization to increase such trade is a good 
one. The time is surely coming when such work 
will be recognized as one of the most important ser¬ 
vices which fraternal societies can work up. There 
will be no use writing to Mr. Morse for trade, for 
his society is well supplied, but we print this to 
show another way in which this direct trade can be 
developed. 
POOR SAMPLES OF MIXED FEED. 
We send you three samples of ground grain feed. Our 
grain dealer, who for years has sold us satisfactory 
feeds, agreed to furnish us five tons of sample No. 1, 
if after trial for a week it proved a good mixture for 
our herd of 20 cows. The cows did nicely on it, and we 
told him to bring along the remainder. The second 
batch, sample No. 2, arrived, and after feeding it a few 
days we noticed the cows fell off a little in milk, and 
when the third batch arrived and gave poorer results, 
than the other two, we began to worry and look for a 
cause. Sample No. 3, is from batch No. 3. We exam¬ 
ined the three samples under a reading glass, and it 
only made us more sure that they are not the same 
mixture, or at least the same quality as No. 1. which 
is the best. He not only sent five tons but got eight 
tons unloaded before I knew it. If the feed is all the 
same quality I can use all he has sent, but I do not 
like the thought of paying for mill sweepings. I have 
not paid him yet, and wish to get your opinion of the 
deal before I do so. The grain dealer told me by tele¬ 
phone this morning that he would see us next week and 
would give us satisfaction if we would tell what we 
wanted. I asked the Director of our State Experiment 
Station to examine the samples, but he told me that as 
long as there was no guarantee on the bags he could do 
nothing. The price we were to pay for this mixture of 
equal parts oats, oil meal. bran, and two parts corn- 
meal, was $29 per ton. Is it worth it? Please give 
us your advice. j. f. c. 
Rhode Island. 
Under a microscope it is evident that samples 2 
and 3 are inferior. Sample 1 appears to be what is 
claimed for it—oats, oil meal, bran and corn— 
though a closer examination would be needed to 
prove it. The other samples clearly contain trash 
like mill sweepings and oat hulls, and we do not 
wonder that the cows fell off in milk. In such a case 
we think the experiment station should act as um¬ 
pire and state how much inferior these samples are. 
While the lack of guarantee may take this out of 
any legal consideration, it is clearly evident to any¬ 
one who can see that two of these samples are not 
worth as much as the other. W 7 e think the station 
can and should tell how much less and then help 
adjust the matter. 
A Philadelphia jury gave a verdict of $8,500 to a 
boy who lost the use of one eye through an explosion. 
In New Jersey some yeai-s ago a jury decided that a 
boy “killed by a car had no earning capacity and thus 
had no value.” 
