Jasper County Democrat, Volume 19, Number 60, Rensselaer, Jasper County, 25 October 1916 — PRESIDENT WILSON TALKS TO FARMERS ON RURAL CREDITS [ARTICLE]

PRESIDENT WILSON TALKS TO FARMERS ON RURAL CREDITS

Also Discusses Good Roadsand the Relations of Capital and Labor. HOW FARMERS MAY BORROW lUnder Rural Credits Payments Are Made Easy With Forty Years Time and Low Interest —Agricultural Extension Explained.

The Nation is Out of War The State is Out of Debt The Democrats Did It!

BY WILLIS S. THOMPSON. Indianapolis, Oct. 14. —The address of President Wilson which was delivered at Tomlinson hall Thursday was an excellent setting out oi the provisions of the rural credits and agricultural extension acts, both, as the Indianapolis Star says, are “pet measures of the President.” In introducing the President, Leonard B. Clore, who presided for the committee of farmers who were responsible for this second speech being made, said: This is a great gathering of farmers. Those of you who are not farmers are largely dependent upon the farmer. The value of agriculture has been recognized in the past by A FEW OF OCR GREAT LEADERS but today we find it different. We find that there is a universal appreciation, we find that the success or failure of the American farmer is having a great deal to do with the credit of our country. We find in the American type that splendid citizenship that is not only Interested in the education of his children, but 18 interested in the community, in the township, in the country, in the 'state, in the nation and in the national progress. We are honored upon this auspicious occasion by the presence of Hon. Woodrow Wilson. President of the Vnited States. President Wilson said:

Fellow-citizens: Mr. Clore remarked that this was a notable company of farmers. I judge by your response that not all of you are farmers, but I have come here because of the very great compliment of an invitation from some representative farmers of Indiana, to give myself the pleasure of speaking about the agricultural Interests of the country. I am proud, my fellow-citizens, to have been associated with the pieces of legislation which have had for their object the thoughtful promotion and assistance of agriculture in the Vnited States, and I want your attention while 1 speak of some of the chief of them. As Mr. Clore says it is universally recognized that the great farming industry of this country lies at the base of our national life. We of course get our food from the farm. Until a man is fed he cannot think about anything. A man cannot worship God on an empty stomach. A man cannot love his country on an empty stomach. A man cannot conduct his daily labor without the assistance of food. There is a sense therefore in which the farmer keeps the fires of life burning in every one of us: and therefore it is a matter of very great surprise that not until very recent years has the national legislation in this country been directed towards the imperative office of seeing that food enough is produced in this country, and that it is marketed in a busi-ness-like and thorough going fashion. It is an interesting circumstance, my fellowcitizens, —those of you who are farmers will bear witness to this that until the passage of the Federal Reserve Act the farmers of this country were not upon the same footing with other business men in America. Apparently America had made the mistake of supposing that all that a farmer did was to raise crops, and I suppose incidentally to haul them to market, or haul them to the nearest railway station so that they might get to a more distant market; whereas, as a matter of fact, the, farmer cannot be efficient in the conduct of his industry unless he is a business man. Unless he knows, that is to say, howto co-operate with other farmers in marketing his crops, not in.driblets and wagon loads, but in train loads. He has got to be a business man in knowing as other business men do, how to co-operate with other farmers in the conduct of what is really a business of distribution as well as a business of production. lie cannot cooperate along the lines of ordinary activity unless he is supported in that activity by the instrumentalities of credit at the bank, just exactly as other business men are supported.

Things Necessary. Therefore when we came to look over the field available for legislation for the assistance of the fanner we saw that there were two things necessary to do. One was to assist the farmer as a farmer and the other was to assist the farmer as a business man. Some part of the assistance given to the farmer as a farmer is of long standing in the legislation and practice of this country—l mean agricultural instruction. It is an interesting thing that the land grant policy and the agricultural colleges which have received aid from the Federal Government for the purpose of promoting agriculture, experiment stations, and agricultural Instruction in colleges, have gone very much further and is still very much more advanced than similar given to any other industry by the Federal Government. One of the signal omisaions of federal legislation yet to be remedied is giving vocal education in other Industries upon the same scale and with the same intelligence upon which it has been given to agricultural interests. It is dearly the legitimate function, if it be not the clear duty, of the Federal Government, to see that instruction in scientific agriculture Is as wide spread as it is possible to make it: but obviously it is also its duty to see that men are trained in their vocations, in the mechanical callings, in all those great processes which have made this country rich, and Uy reaction have tended to make th* farmer himself rich. But only iu recent years, my fellow-citizens, has it

been revealed that It Is not enough to bare experiment stations at the colleges and to have classes at the colleges where ont of books young fellows can learn to know more, theoretically, about farming than their fathers did. I have known certain farmers to be rather resentful when the youngster came home and pretended to know more than hla dad did about how the land ought to be cultivated. I have alee seen that same youngster sometimes raise more to the acre than his father did. which was an additional source of chargin, I dare say. Rut that is not enough. The boys who can go to college and hear lectures on agriculture and take part in the experiments on the college farm are only a handful after all. just as the boys who can go to college for any other purpose are only a handful after all. So that only recently, and only within a year or two on a proper scale, has the process of carrying experiments away from- the colleges out on to the farm, been adopted. Making Sacrifices. Now look what that means. One of the most interesting things—l had almost said one of the most touching things—to me about the public servants in Washington is this: that there is a great body of public servants that the bulk of the nation never hear anything about. They hear about the Postmasters and the Internal Revenue Collectors, but of that other great body of appointments which have too often been regarded as patronage—politics touches all that, or tries to touch it - but not the great bureau of standards of Washington, not the great agricultural department, in the many bureaus of the Interior Department, in the Department of Commerce, in the Department of Labor. there are men with the best scientific brains of the nation serving the government and serving it for one-half or one-third or one-fourth what they could get if they allowed themselves to be employed by Industrial corporations. There is not any more devoted or admirable body of public servants in America than these men es science serving their fellow-citizens on a pittance. I do not like to speak of it because it is not creditable to the gorernmeut that it pays them so little, but it is creditable to them that they serve for so little. I want to pay them my tribute of respect and admiration. Now these men in the laboratories of the Agricultural Department are doing this: They are preparing for distribution among all the farmers in the Union the scientific knowledge of the world with regard to soils, the fertilization of soils, the cultivation of soils, the rotation of crops, the kind of soil this crop should have as distinguished from the other, and It is trying now through the almost innumerable agents of the government going abroad in this country, to show in every neighborhood how this science is to be applied to bring the agriculture of the nation up to the standard which we all want it to attain ; because, my fellow-citizens, except here and there, the agricultural lands of this country are not producing what they ought to produce. They are not producing as much per acre as similar lands much longer Used, much more nearly exhausted, are producing in other countries where scientific methods are more universally employed.

Can Be Corrected. I was told by a grain merchant so long as ten years ago that grain exports was becoming a decreasing business; that the population of this country was growing so that a larger and larger proportion of our cereals were being consumed In this country and a smaller and smaller proportion *shipped to foreign countries. Now that is perfectly susceptible of beihg corrected if scientific farming is widely enough employed. I am told, and I believe upon competent authority that the tilled and cultivated lands of this continent ought to produce in the aggregate twice as much as they are producing now. In proportion as this country grows in population we can supply the rest of the world with food in smaller and smaller quantities. unless we improve and increase our production per acre. We ought to continue to feed the world. Not really in order that our farmers may get rich, but in order that we might acquit ourselves like men of knowledge and men of efficiency. But not only does the Agricultural Department conduct demonstrations on the farm, but it "has repeatedly, within the last few years, undertaken to do what it never did before —acquaint the farmer in detail with his markets, their whereabout, their pri<-e. the means of access to them, the methods of co-operation which ought to make success easier then it is if there is no co-operation; and has undertaken in a great bureau of markets to guide the businesslike farmer in selling his crops at the greatest advantage and where they are most needed and along with that has gone the very interesting development of the Parcels Post, whereby the most perishable kind of farm products can be rapidly shipped and distributed in moderately small quantities. I mean products like eggs and things that must be shipped at once, and must be widely distributed at once; that cannot be put in warehouses. 1 know that eggs are sometimes put in warehouses. I think I can recognize that kind of an egg when I eat it, and it seems to me not to have the real spice of life in it. The real egg industry is the industry which is served by the Parcels Post. By all of these methods, some of them old. most of them Hew, the government of the United States fans been trying to serve th* rarmer and the farm. Take it to Him. Not to make him goto school somewhere to find out what the latest discovery in regard to soils is. but to take it to him and explain it to him, and show it to him on a piece of ground. But the new thing, the absolutely new thing, and the thing that it is astounding should be new, is assisting the farmer as a business man. I am told that some very Interesting hearings took place in this city not long ago when the Rural Credit Board visited Indianapolis and sought to take testimony as to the conditions, which that board has imposed upon it as a duty. I am told that in that bearing testimony was given that it was not particularly difficult in Indiana for a farmer to get a loan of a thousand dollars or. more, but it was very difficult for him tb get a loan of less than a thousand dollars; and it was rather difficult for him to get a loan of even a thousand or more at the rates of interest wbicli other business men pay for the money which they borrow That was exactly what the Federal Reserve Act was made to meet. I like to tell about this because the farmers do not seem to have discovered it. and the bankers do not seem to hare divulged it.

But under that act a farmer can borrow any sum of money upon exactly the same basis that anybody else can. If I am a merchant and have a bill of lading, I can *c to the bank with that bill of‘lading and borrow money on it at a reasonable

rata of interest. NoW. under the Federal Reserve Act. if you can present a paper, the security of which is your cattle, or the products of your farm, when the same are somewhere in a warehouse, for which yon can shbw a warehouse certificate, you have got the same kind o/-commercial paper that I as a merchant would have if I have a bill of lading; and yon could get money on that for the things you are doing right away, bnylng fertilizer, or buying additional cattle, using it for the improvements you Intended to put on the farm right ■way, or implements yon must buy. And upon that security the bank can lend just as freely as it would lend the merchant npon bls security. By sending that to the Federal Reserve Rank of the district, they could get currency on it; so you cannot expand that kind of credit —I mean that kind of a demand for money beyond the supply of money, because the money comes In quantities to meet the demand and shrinks with the shrinks of the demand. Never before in the history of this country, to our shame be it said, did we have an elastic currency. Now No Limit. We had a fixed body of currency and when you went to move the Crops you ran up against the limit of it. There is not any limit any more. Or to speak more correctly. the only limit is the good commercial paper, and your commercial paper is as_good as anybody else’s. That not only, but the time upon which you can borrow is even more favorable than that upon which the merchant can borrow. The Federal Reserve Act limits loans to merchants upon their mercantile paper to a limit of ninety days. It limits agricultural paper to six months. In other words, you have twice as long a period in which to pay that loan as has the merchant. That is not because the law wanted to play favorites, or had any features of class legislation, but because of the law of nature. which takes about six months to turn around. We didn’t fix the six months. It was fixed by the revolutions of the seasons; and I think thnt is very prudent; apd which conforms its terms to the revolutions of the seasons. If it did not, the seasons would not mind, but the country would suffer; whereas, in ordinary mercantile procedure, it does not take six months to turn around; you can realize upon your merchandise within a shorter time; whereas the farmer cannot realize on his crops until his crops come out of the ground where they are growing. That is where his assets are going to Come from ; and that is where he is going to get the money to pay his debts. Permits Banks to Loan. Not only that, but for the first time in the history of the country, the Federal Reserve Act permitted the national bankers of this country to loan money on the security of land mortgages. Allowed them to loan up to twenty-five per cent. ,0f their capital, plus twenty-five per cent, of their time deposits. In other words, it made, if I remember the figures correctly, five hundred million dollars available for loaning on the security of land mortgages. In 1915 twenty millions were loaned on that basis, and by June. 1916. forty-five millions had been loaned on that basis And whereas, the other loans of the bankers, responding to the expansion of commercial credits among the farmers, that had been practically negligible before that time, at the present time they foot a hundred and twenty-five millions. Not only that, but the farmers are getting wise about it- I heard just the other day of a group of farmers in Montana who went to the bankers from which they had been borrowing, and said. “We are not going to borrow from you any longer at the interest we have been paying, ’because we have discovered we can get it cheaper.” Whereupon the natural thing happened, the rates of interest in the banks, which had before been loaning to them. Came down to the level which is established in this new competitive market by the Federal Reserve Act. But you cannot get money on a land mortgage under the Federal Reserve system for a longer period than five years. That was why the Rural Credits Act was made supplemental and corrective— not so much corrective as supplemental because it was necessary to devise a new’ system for lending money on the security of land. I am not going into the details of that system, because they are available to you: though they are extremely interesting, r am merely going to call your attention to this, that under that system you can borrow from the new series of banks, with an additional and new capital, with additional resources, and with much of the assets of the United States Treasury back of it. money on long terms, as much as forty years, not less than five. It does not invade the validity of the Federal Reserve Act, you observe. It is not less than five, but anywhere from five to forty years. Not only that, but if you borrow for forty years, you Will find by the time thirty-three years have gone by. that you have paid the mortgage, because there is a system of amortization, as it is called. That is merely a big word which means paying it off by degrees. A period of amortization by which by paying one per eent. of interest on the loan, that one per cent, accumulating at compound interest will, in a period of thirty-three years, have paid off the principal of the mortgage. So that a man may Ijy keeping up his payments of interest carry a forty year mortgage, and, before the forty years is over, find be has not got any mortgage. In the meantime, the twelve Rural Credit banks, which this system establishes, will be so related to each other and So administered in co-operation With each other, that the resources of each will be the resources of all—or rather, I should put it, the resources of all will be the resources of each; so each will be as strong as the system. Co-Operative Work. And not only that, but it rests, first of all, upon a voluntary co-operative association of farmers themselves. You don’t borrow as individuals, but first ten. or more, farmers establish themselves together, and through the combination apply for the loans which their members desire. You don’t have to go to the bank to get the loan; you are certified by your association; and if the security, under the assessment of the value of the land, be found to be correct, you can borrow up to fifty per cent, of the value, without so much as going and speaking with the authorities of the bank, through the common agent of the association. So tha| these are the means by which the Federal Government is helping the farmer to do business in a business-like way; and back of that, my fellow-citizens, remember that the Congress has passed the Warehouse Act, which gives assistance to the Federal Government in the establishment aud maintenance of warehouses, so that ihars Kight be more warehouses available

• K < jjJ f . ' / j’lOG, - In which yon could put your cropa, get your certificates of storage; and then borrow your money on these certificates. And not oqly that, but it has passed an act. which, ft seems to me. la of the very greatest value to the farmer. I mean the Grain Standards Act, by which grain is to be sold and bought according.to certain standards, which have sometimes been neglected in the buying; and by the negligence of which the farmer has sometimes been sadly cheated in the prices be got. So that the Federal Government is seeing to it that the middle man pays for what be gets, and that by Indisputable methods the grain Is standardized, so that Americans buy what they think they are told they are buying and foreigners buy what they are told they are buying: and all the world knows that America is trading on a business basis. ' Proud of It. Now, don’t you think tbaLls an interesting story? That is the story I came to tell you; and I am going to say In your private ear that I am personally proud to tell it. because I was personally privileged to have a great deal to do with it. Don’t misunderstand me, I am not claiming the Credit for this, I am simply wanting to tell you how appreciative I aril to have an opportunity in It. I don’t apparently do much more than sign bills; but I always know what is in them before I sign them. All tie rest of my life it will be a matter of pride with me that I was priviledged to play a part .in serving the farmers of this country to be better farmers and to be real business men. They were at a fatal disadvantage in the field of credit; they were at a fatal disadvantage in the distribution of their products; they were at a disadvantage, as compared with farmers in other countries, with respect to the scientific methods of farming. Now, most of these things have been corrected. At any rate, we have got a beginning; and it only depends upon our energy and intelligence how much we make out of it. For my part, I look forward to an unprecedented Increase in the efficiency of the American farm, and an unprecedent increase in the efficiency and happiness of the American farmer. A man is happy, I take it, in proportion as he accomplishes something. Some people thUik they are happy in proportion as they do nothing. Some people, as a witty acquaintance of mine said, devote themselves to expense regardless of pleasure. They don’t know whart pleasure is. The supreme human measured it seems to me, is to do something worth doing the way it ought to be done. That is one reason I am interested in politics. I don’t regard politics as an opportunity to talk, but as an opportunity to unite with other men in accomplishing something. If I didn’t, I would talk about something else, because I know a good many subjects about which you can talk, and the average audience won’t know whether you are talking sense or not.—some subjectswith which I had a speaking acquaintance when I was a college man. Methods of Organizing. But politics is a method of organizing the national life in a way that will do the nation the most good. And whenever it gets off that conception, it becomes uninteresting, because it Is futile, and I am not Interested in futile things; but I am intensely interested, fellowcitizens, in the politics which is going to organize this country for unparalleled efficiency in the years to come. This country has a role to play in the world which does not merely consist of feeding it; does not merely consist in furnishing it with better manufactured goods than you can get anywhere else; does not merely consist in furnishing it with coal and gold and iron and all the other priceless deposits of our wonderful Continent, but it consists in supplying it with conceptions of justice and liberty, which will put breath in the lungs of every free man. I am interested in the farmer because I want people well enough fed to do the job to the queen’s Aaste.

In course of his address at the Coliseum at the state fair grounds, the president said: There is one field in which we are particularly sluggards, X mean understanding the relation between capital and labor. Nothing can be for the Interest of capital that is not for the interest of labor, and nothing can be in the interest of labor which is not in the interest of capital. If men want to get rich, they must have human relationships with those who help them to get rich. That is a lesson that men have been exceedingly slow to learn—slower than any other lesson of co operation in America. I pray God that their eyes may be opened and that they may see that the future of this country lies in their co-operation, open, candid and cordial, and uot in their antagonism, and that if they will once get together and plan in the same spirit the same thing, the industry of America will go forward by leaps and bounds such as we have never yet seen.

Sometimes it is necessary, in order to arrest attention, to pull men up with a round turn and say, “Stop, look, listen,” because presently, if you don’t, the great forces of society will correct the things that have gone wrong. Society is the jury. The parties are not going to settle; the nation is going to settle, and I am counsel for the nation.