The Lampasas Daily Leader. (Lampasas, Tex.), Vol. 11, No. 56, Ed. 1 Tuesday, May 12, 1914 Page: 2 of 4
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THE LAMPASAS DAILY LEADER
The Source of the Bank Account.
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Co-Operative Farm
Products Marketing
How It Is Done in Europe and May Be Done
in America to the Profit of Both
Farmer and Consumer
By MATTHEW S. DUDGEON.
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(Copyright, li>14. Western Newspaper Union. >
WILL THE BANKERS REFORM?
Copenhagen, Denmark.—The Ameri-
can banker must reform. If he does
not he will be up against it as are
others who refuse to mend their ways.
The American farmer cannot get
money of American bankers upon
terms suited to his needs. He is go-
Ung to have the money from some
eource. If the banker will not give
4t to him he will organize a new kind
of a bank* for you may rest assured |
that the American farmer is going
to have an opportunity to borrow
money upon some suitable basis. The
Irish farmer can get money on favor-
able terms; the Belgian farmer co-
operating with his neighbors does his
own banking; in Germany the co-
operative banks do a business that is
astonishing in its volume; in Denmark
lit iB easy to get money for buying a
farm or for temporary investment in
seeds, fertilizers or stock. The same
is true of the farmer in Italy and
Prance; even in benighted Russia
farm credits are cared for by co-
operative organizations.
Do the bankers of America think
■that the American farmer is going to
.consent to continue to be the only
icivilized agriculturist who haB no ade-
quate borrowing facilities. That is
not the American way. What, then,
can possibly prevent the formation of
jco-operative credit associations all
•over America? Nothing, except the
^presence of some institution that will
ido for the American farmer what co-
operative credit is doing for the Eu-
ropean farmer. If the American bank-
er washes to do the banking business
(of America so far as the farm is con-
cerned, he and he alone can give the
farmer this sort of an institution and
[thus make co-operative credit socie-
jties unnecessary. It is up to the
[banker.
Capital for Farming. 1
Formerly when an American farm
could be acquired by living upon it,
[when horses and oows and implements
[were cheap, and when fertilizers,
blooded stock, and special high-grade
(seeds were unknown, a young man
■with comparatively little capital could
begin farming. Now considerable capi-
tal is as necaseary to success in agri-
culture as it is in the manufacturing
Industries. Every wise farmer knows
ithat money Judiciously expended in
[better stock, bettef buildings, labor-
saving machinery, proper fertilizers,
,and good seed will net large returns.
But it takes money to do these things.
Consequently there is a demand for
iloans.
In America the farmer can seldom
jget a loan on terms that meet his
[needs. In Ireland, Belgium, Germany,
/Holland, Denmark, France, Italy and
[elsewhere upon the continent the
.banks have forced the farmers to or-
ganize co-operative credit societies. In
many instances the government also
■has aided the co-operative banks in
obtaining money for loans. These so-
cieties are taking a safe, profitable
business away from the bank. Now
when it is too late the banks realize
'their mistake.
To buy a farm there are a number
iof different methods open to the Dan-
ish farmer. It must be remembered
ithat in Denmark a farm is consid-
ered as having live stock and imple-
ments used in working the land in-
separably attached to it, hence the
purchase price to be paid includes all
equipment necessary to the operation
iof the farm and all mortgages- are se-
icured by~a pledge of this persenal
property as well as of the real estate.
If the would-be buyer has forty per
cent, of the purchase price he may
apply to a credit society for a long-
time loan amounting to sixty per cent,
of the value of the farm and all equip-
ment and stock upon it. The loan may
run from forty-five years to seventy-
nine years. The borrower has his
prospective purchase surveyed and as-
sessed. He makes out a mortgage and
delivers it to the co-operative society.
This mortgage and hundreds of oth-
ers like it are delivered to a trustee
with a trust deed which pledges them
as security for a series of bonds. The
co-operative society guarantees the
bonds also.
It Is from the sale of these bonds
that the co-operative society obtains
its funds. These co-operative credit
associations have in the beginning no
capital whatsoever. Each is simply
an agency whose functions are to see
(1) that the real estate security of-
fered is assessed at its true value;
(2) that the title is clear; (3) that the
mortgages are properly executed;
(4) that they are -grouped, pledged
and deposited with the trustee;
(5) that the trustee issues bonds;
(6) that the land, buildings and equip-
ment are properly cared for and their
value is not permitted to deteriorate;
(7) that the payments of principal and
interest are promptly met.
Easy Repayment of Loans.
The farmer pays from four to six
per cent, of the principal amount each
year. This is not wholly interest, how-
ever, for it includes a small install-
ment of principal, for the mortgages
are all amortization mortgages. Pay-
ment of this fixed sum annually or
semi-annually for the fixed period
therefor automatically discharges the
debt. A small amount out of each
payment is also set aside for reserve
for the co-operative society and for
an expense account. It has been the
universal experience, however, that
the expense runs very low.
Still Easier for the Farm Laborer.
There are other forms of loans even
more advantageous to the borrower,
particularly if he is one of the poorer
farm laborers. If such a laborer seeks
to become a land owner on a email
scale he may under certain conditions
secure a loan for nine-tenths of the
value of the proposed purchase, being
required to advance only one-tenth of
the purchase price in cash. The gov-
ernment furnished the funds for these
loans. The conditions are (1) the bor-
rower must have been engaged in ag-
ricultural labor for five years (women
may take advantage of this law as
well as men); (2) the land must not
exceed ten acres in extent nor $2,144
in value; (3) the borrower and pro-
spective purchaser must agree to crop
the farm in a certain manner, dividing
it up into five or seven fields and fol-
lowing a certain rotation of crops, thus
insuring continued productiveness and
preventing deterioration of soil fer-
tility. Under these mortgages the
borrower pays three per cent, interest
with no installments upon the princi-
pal for the first five years. Then he
pays, in addition to the interest one
per cent, upon two-fifths of the loan as
an installment upon principal, doing
this until the two-fifths of the loan 1b
entirely discharged. Thereafter he
pays an annual installment of one per
cent upon the three-fifths remaining
of the principal, this being in addi-
tion to his three per cent, interest
as before. The bonds may be issued
upon unstamped paper and are free
from tax.
Does the Danish farmer take advan- l
tage of these opportunities? Are the j
tenants becoming land owners? The [
facts are these: Denmark has 2,600,000
population, somewhat less than that
of Chicago. It has about 500,000 fami-
lies, including those in cities and vil-
lages as well as those in the rural re-
gions. These co-operative credit soci-
eties have a membership of over
200,000; that is to say, two out of
every five families in the entire coun-
try are represented in them. Largely
as a result of this credit system ninety
per cent, of the farmers of Denmark
own their own land.
How Character Is Capitalized.
Obtaining a loan on personal secur-
ity has been euphoniously termed
“capitalizing character.” It is not an
inept phrase since any farmer who has
a good character, who is a sober, hon-
est, industrious, intelligent, productive
worker, has a capital that is consid-
ered a proper basis for credit and he
can in fact capitalize his character.
His character is in very truth under
these conditions his capital. Here is
the way it is done here in Denmark:
By the law enacted in 1898 the gov-
ernment is authorized to turn over to
the credit association $1,250,000, for
which the associations account to the
government at the rate of three per
cent, per annum. This sum is placed
at the disposal of the farmers’ credit
association in order that these asso-
ciations may be ready to give small
loans to their members. When any
farmer finds it urgently necessary to
secure a loan in order to meet ex-
penses such as the payment of wages,
the price of better seeds, or of artifi-
cial manures, or of feed for cattle, he
makes application to one of these as-
sociations. In determining the amount
of the loan to be granted to each man
it is the theory that the earning ca-
pacity of the borrower should be taken
into account. This is thought to be
best indicated by the number of dairy
cows which he owns.. A member may
thus obtain a loan to about $13 per
head of cattle fed and milked on the
place. The loans must be repaid in
from one to nine months. Interest
must not, according to the original law
exceed 4% per cent, per annum to
the borrower.
Danish Bankers Have Reformed.
The fact that there are in Denmark
many banks which are organized for
the sole purpose of meeting the needs
of the farmers has awakened the Dan-
ish banker to the fact that the rural
credit is a big business which he-can-
not afford to ignore. Compared with
the American banker the Danish
banker most decidedly has reformed.
He does meet the needs of the farmer
in a manner which would surprise
Americans. This is particularly true
of the method in which he assists in
financing co-operative associations.
When the big Trifolium dairy associa-
tion was formed, for example, it was
done in this way: One hundred farm-
ers, most of them owners of large
farms, formed an organization for the
manufacture of dairy products and for
the further purpose of supplying milk
to the city of Copenhagen. These one
hundred farmers were the owners of
something like 12,000 cows. While
they individually had property, real
and personal, they had no money
which they wished to invest in a co-
operative organization. They there-
fore sent their leaders to the bank
to borrow the money. They simply
asked the bank for a loan of $125,000
on the note signed by these leaders.
The bank did not require the other
members of the association to sign
the note, although by the terms of the
agreement into which all had entered
in the formation of the co-operative
association all were liable, jointly and
severally, for the debt contracted at
the bank. As a matter of course the
bank made the loan to these farmers
at a low rate of interest.
Can Banks Supply Rural Credit?
I have said it is up to the banker
to supply the American farmer with
loans similar to those supplied to the
European farmer. But there are those
who say that the joint stock bank can
never meet the farmers’ needs as do
co-operative credit societies and that
co-operative credit will come in spite
of all the bankers can do.
Dr. Charles McCarthy is of this
number. He bases his conclusion on
these grounds: First, no joint stock
bank can afford to tie its money up
for long-period loans as do the credit
banks. These deposits are all short-
time deposits. They have.no way of
hypothecating one series of loans in
order to raise money for another se-
ries.
Second: No money-making concern
can possibly serve the farmers as do
co-operative credit societies whose sole
aim is to aid the-borrower and. to pro-
tect his interests.
But in agriculture a system of rural
credit cannot be a substitute for
brains and business sense and a mar-
keting system. Unless the farmer pro-
duces a good product and sells It to
advantage his farming will be a fail-
ure. Easy loans will only make it
a bigger failure. Co-operative credit
is important, but with It must come
a better system of marketing eithei
co-operative or otherwise, which will
give the farmer more than half what
is paid for the farm product. And so
far as we can learn co-operative mar
ketlng Is the system which will do this.
HOBSON’S RETORN
By M. QUAD.
It was all over with Private John
Hobson. For two years hte had been
a member of Company C, Seventh regi-
ment, stationed on the frontier, and
ever since the first week he had been
on the blacklist. He got drunk; he
disobeyed orders; he quarreled with
his comrades; he fell asleep on sentry
duty; he left the post without leave;
he was the most slovenly man of his
company. It was far easier to tell
what he hadn’t done than what he had.
Private John Hobson had been ad-
vised, reprimanded, sent to the guard-
house, mulcted of his pay, given extra
duty and threatened with court-mar-
tial, but after two years he was the
same man still. It was inevitable that
the end would come, and come it did.
He was court-martialed on about a
dozen charges and convicted on all of
them, and the sentence was that he be
imprisoned for one year and then be
discharged in disgrace. It was a duty
the officers owed the regiment and the
service, and yet they felt a bit sorry
for the victim. He waB morally irre-
sponsible rather than vicious. The
devil in him had more likely descended
than developed.
“I’m sorry for you in a way,” said
the colonel, “but it was no use trying
-to do anything with you. I never saw
a man like you. You have been
charged with everything but coward-
ice, and if we had not been at peace
with the Indians that charge would
probably have been included.”
“I know I’ve made a lot of trouble,
colonel,” replied the man, “but nobody
can call me a coward. If we’d had a
fight I know I’d have been in it with
the rest.”
“Such men as you are shirks when
there is any fighting to be done. Your
barrack brawls don’t signify soldierly
courage. It’s no use to talk, however;
you know your sentence.”
Hobson was sent to the guardhouse
to wait for the day when he should be
sent off under escort, and the sergeant
of the guard was surprised to see his
prisoner shed tears.
“You ought to have known it would
come,” he said, in sarcastic sympathy.
“Look here, Bergeant,” said the man,
as he crowded back his emotions, "the
colonel called me a coward.”
“Well, do you find any fault about
it?”
“Do you believe I’m one?"
“Of course.”
“And does Corporal Shanley and all
the boys believe so?”
“Not a doubt of it.”
“Good "God, but I can’t stand that,
sarge! I’ve shirked duty and been a
nuisance to everybody, but don’t call
me a coward. I’m to be sent to prison
and disgracefully discharged, but
leave me one thing to build up on
again. Call me a devil, a fool and a
lunatic, but don’t say I’d shirk a fight.”
“Let me tell you something, Hob-
son,” said the stern-faced old ser-
geant, as he looked the prisoner up
and down in contempt. “Judging by
what I’ve seen of you I wouldn’t agree
to drive a dozen redskins off this res-
servation with a thousand men like
you behind me. That’s pat, my man,
and you may swallow it or no.”
Hobson grew white-faced and turned
away and. wept, while the sentinel at
the door laughed unfeelingly and
asked him if he had any Indian scalp-
locks to prove his bravery.
“Why, the sight of a buck in war
paint would have scared him out of his
shoes!” was the general verdict of his
comrades, and each and every one
added a wish that he had never come
to the company.
That night Hobson dug his way out
of the guardhouse, and the various
squads sent out next day in search of
the deserter failed to get any trace of
him. Desertion was a fitting climax
to his career, and he would likely be
heard of next as an outlaw. Weeks
passed and dreary winter gave place
to spring. Sometimes the men won-
dered about Hobson, but nothing was
advanced to his credit. He had got
clear off, and no one thought to ever
see him again. Indeed, there were
weightier things to think of. The In-
dians were becoming restless, and re-
ports of war dances were coming in al-
most daily. They might go on the
war path and massacre a dozen set-
tlers and scalp a few teamsters, and
the troops might have a hot chase to
drive them back over the Republican,
but it would end there. The idea that
they might attack any of the frontier
posts was too absurd. It was so ab-
surd that at Fort Wallace no defensive
preparations of any sort were made.
Even the guard at the powder maga-
zine was limited to one man.
On a certain Wednesday the reports
were more numerous and disquieting,
and the men were paraded and in-
spected to be ready for an order to
take the field. If there was any excite-
ment it vanished as the companies
marched back to their quarter*. The
colonel looked down from the hill into
the peaceful valley with his binocu-
lars and felt relieved. He noticed the
grazing herds—the curling smoke from
the farmhouse chimneys—the plow-
men in the fields and the freighters on
the winding highway, and he smiled
at the idea of danger. The hostiles
might do their bloody work over the
range to the north, and over the river
to the weBt, but they would, not come
within fifteen miles of the fort. /
That night at ten o’clock the sen- J
tinnel at the gate cried: “Halt! Who/ '
comes there!” Then he called for the/
corporal of the guard, and he for the,'
officer of the day, and ten minutes/
later, the colonel, who was about tqi
seek his bed, was called out. He
found a man in citizens’ dress with
the officer of the day and a sentinel.
The man was rough, unkempt and
ragged. He was hungry and footsore
and exhausted.
"Who is it and what’s the news?’”
queried the colonel, In no agreeable
frame of mind.
“It’s Hobson, sir,” answered the ar^
rival, as he wearily saluted.
“Hobson? Hobson? Why, you are
the deserter and have come to give
yourself up. Adjutant, why wasn’t
this man sent to the guardhouse in-
stead of disturbing me?”
“He has news, sir,” replied the ad-
jutant.
"Colonel,” said the deserter, as he
leaned heavily against the veranda of
the commander’s quarters, "I’ve been,
living among the Indians, greasers
and outlaws since I deserted. You
may know that the Sioux are ready
for the war-path, but I don’t believe
you know that old Concha and 600 war-
riors are hiding along the river over
there and will move on you tonight.
It has been planned for days, colonel*
and they’ll be here to attack in the
gray of morning. . I’ve known it for
three days past, but I couldn’t get
away to give you warning. I dodged!
them tonight, and here I am and my
news is straight. They’ll sweep the
valley clear and then rush the fort.
Now, send me to the guardhouse aa
a deserter and get ready for trouble.”
There was a moment’s silence as the
deserter finished. There had been a
ring of truth in his every -word, and
no one doubted his news.
“Hobson, you are no coward, and
you will not go to the guardhouse,”
frankly replied the colonel, as he ex-
tended his hand.
Then men went galloping down into
the valley to warn the settlers and
bring them in, and the fort prepared
for defense. Orders were issued in.
whispers and men moved about like
shadows. In three hours a o_’east-
work of boxes, bales of r>.ay, wagons,
and turf covered the most exposed
point and the one most likely to be at-
tacked. An hour later every man who
could fire a gun was crouching behind
it and waiting for the expected attack.
"Sergeant,” whispered the deserter,
as the non-com. peered into his face
through the darkness, “you said I was
a coward.”
"Yes, I did.”
“And you said that Corporal Shan-
ley and all the boys believed me a
coward.”
“Well?”
“Well, I’ll make you all take it back
tonight or go to h——1 trying!”
Moving with the footsteps of ghosts,
and leaving the crickets still singing-
behind them, Concha’s 600 warriors
left their lurking place under cover of
darkness and swept up the valley.
They found it deserted of human life,
but, conscious of their strength, they
pressed on to the fort. At the first
signs of daylight they raised a savage
cry and made their rush. But for the
extemporized breastwork the post
would have been carried off-hand. The
rifle fire surprised and checked them,
but they were not panic-stricken.
They rushed again and again, and at
length, at one point, half a score of
them broke through. Six or seven offi-
cers tried to drive them back with
sword and revolver, and the melee had
become bloody and furious, when a
man with clubbed musket dashed in.
and cheered as he laid about him. It
was the deserter. He cheered and he
struck, and he struck and he cheered,
and every time the musket stock
crashed down it shattered a skull. He
did not fight like a man, but like a
devil. Almost with his -own hands he
killed or drove back such ae had sur-
mounted the works.
All along the line the hostiles had
had enough. Two hundred of their
number lay dead on the green grass as
Concha gave the word to draw off, and
this heavy loss was to break the pres-
tige of the Sioux chieftain and make
him beg for lasting peace.
“Hobson! Hobson! Where is Hob-
son?” called the colonel, as the fight
was over and his heart beat with grati-
tude for the man who had brought the
warning.
"Here, sir,” replied Sergeant Davis,
as he pointed to one of the 20 dead
men inside the breastwork—a dead
man with three dead warriors lying
within reach of his hand.
“And I called that man a coward!”
“And so did I, sir, and so did we
all, and may God forgive us for it!"
(Copyright, 1514. bar Dally Story Fub. Co.>
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Vernor, J. E. The Lampasas Daily Leader. (Lampasas, Tex.), Vol. 11, No. 56, Ed. 1 Tuesday, May 12, 1914, newspaper, May 12, 1914; Lampasas, Texas. (https://texashistory.unt.edu/ark:/67531/metapth897942/m1/2/: accessed July 17, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu.; crediting Lampasas Public Library.