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.. as*** m. .' * up's? * ■> ■ • -w- ■ - * • ' | Industrial Farming In Europe BY HARVIE JORDAN Agriculture in the United States is not keeping apace with the prog ress and the developement of other great industries of the nation. Fed eral statistics clearly indicate the truth of this assertion. It is a lamen table fact, and at the same time a most serious one,that farmers of the United States are not now produc ing a sufficient quantity of the prin cipal staple food products to supply the daily needs of the American pop ulation. In 1904 this country export ed more than fifty million dollars, worth of beef to foreign nations, while for this year exports are prac tically nothing. Instead of exporting, we are importing large quantities of meat products from South American countries, and it is feared the same conditions will soon apply to bread stuffs. Within the past decade the popu lation of the United States has in creased 21 percent, while our food products have increased only 10 per cent, indicating a shortage of 11 per cent in production, as compared with the increase in population. Again, tenantry on American farms is rapidly increasing, especially in the South. Large landlordism is also in creasing in relative proportion as small landowners are being shifted to tenantry. This most undesirable condition of affairs has not only attracted the se rious attention of leading agricultu ral economists, but that of our state and federal governments as well. The step in the effort toward the re habilitation of American agriculture, which appeared most feasible, waste investigate the operations of the agricultural industry in those Euro pean countries where the business of farming had become successful and profitable. Commission Appointed. The origin of the movement toward federal legislation and eo-operation on this most important matter began during the close of ex-Bresident Taft’s administration. When the con gress of the United States, last March, passed an act authorizing the president to appoint a commission of seven delegates to visit European countries, make a careful study of the various phases f rural credits and rep< r; hack its findings to con gress. The act was approved March 4, and President Wilson made the appointments a few weeks later. I had the honor of being named one of the delegates to serve on this federal commission, which left New York April 26, together with the American commission, made up of sixty delegates from thirty five states of the union and five provin ces of Canada. The two commissions, co-operating together, extended then investigations by personal study into the following fifteen countries: Italy, Hungary. Austria, Russia, Germany, Switzerland, Denmark, Norway, Sw-eden, Belgium. Holland, France, England, Scotland and Ireland. The investigation covered a period of three months, and the reports are now being compiled'for publication. The report of the United States commission will be made directly to congress and become a public docu ment and the basis for federal legis lation, while that of American com mission will be distributed to the various states and agricultural orga nizations of this country and Canada. It is confidently believed that the information gathered by those com missions will enable the federal gov ernment and the vai it us state legis latures. with the co-operation of the people, to enact laws a hicn w ill meet the needs of American agriculaure for a safe and sound system of rural finance, which is the recognized fun damental basis upon which the re habilitation of American agriculture must be founded. Banking For Farmers. The great masses of American far mers market their products but once a year, hence short time loans as ap plied to the ordinary business of com merce is of but little value to those engaged in agriculture. Banks en gaged in tiie commercial business of short time deposits and short time loans cannot supply the needs of the pit dueers .f the soil, humo rs re quire a separate and distinct system of banking, a system which will se- cure loans upon long time at a low rate of interest and with a gradual repayment of the principal. The best agricultural countries in Europe realize the importance and necessity of inaugurating an inde pendent system of banking for the farmers, and for the past half century these purely agricultural banks have provided financial facilities for foreign farmers, which would never have been possiple with commercial banks. Wherever these rural bank ing systems have been inaugurated, the business of agriculture has been industrialized, and made highly pros perous and successful. Lands have doubled and trebled in value; the yealds of crops have multi plied in quantity; the lands are bet ter tilled and fertilized: farmer ten ants are rapidly becoming lanblords; the middleman has been entirely dis placed; co-operative buying and marketing societies have been orga nized on strictly business lines and the producers have won success in the economic management of their own affairs in the handling and dis tribution of their products from the farm to tne retailer or consumer. Effect en Pricees The adoption on these rural bank ing systems have not only had the ef fect of emancipating the foreign farmers from the grip of the usurer and dominion of the middleman,but they have had the further most com mendable effect raising the prices to ! the consumer. In connection with the present sys tem of rural credits in this country,! desire to especially point out the fol ! lowing important facts: The only food products raised on American farms which are ample to supply the | ever increasing demands of our pop ulation, are those products, such as butter, poultry, eggs and vegetables, | the sale of which yields a cash return i each week and thereby properly fi nance themselves. Those staple products requiring twelve months or longer in their ; preparation f< r market, and which must t< gre..t extent be financed in the production on borrowed capital or with supplies bought on high cred it pr’ces, we find gradually .falling behind and unable to supply the needs of the Air.ercan nation. These facts clearly emphasize the imperative need- of a system of rural finance which will enable our farm ers to'improve the present methods of ; griculture and to multiply the productive capacity of their soils The foundation capital for rural banking systems in European coun tries were supplied many years be fore the successful organization of co-operation marketing socities was made possible. In Europe, land mortgage banks provide all the facilities for supply ing land owners with ample capital on long time loans at a very low rate of interest. The rate of interest is low because the character of secur ity offered is regarded as absolutely safe. Likewise, the improved farm ing lands of the United States should become a liquid asset in supplying all the active capital in re- quired in carrying on the busi ness of the farm, instead of lying practically dormant as it does today, and only being utilized for the single purpose of crop production, while the land owners have to secure then credit from outside sources at usuri ous rates of interest. The operation of the European land mortgage banks is simple. Loans to farmers are usually granted for a period of fifty years, in amounts at from 50 to 60 per cent at the market value of the lands offered as security All loans are made upon the mortiza tion plan of gradual redemption, that is. the payment of a small annuity on the principal each year by the bor rower, so that at the end of the period for which the loan is granted, the principal, as well as the interest, is paid in full and the debt cancelled. lo illustrate: .a land owner, with improved farming lands, valued at say. 610,000 desires a loan for $5.0 n for a period of fifty years. The appli cation is tiled with tneland mortgage bank operating in tr.e territory of the a ►plicant. and after inspection, i!' b'und satisfactory, the loan isgrante 1 and tiie money laid over to the bm THF, COFFEE COUNTY PROGRESS, TK)Ur;f A c . GEORGIA row r er after a mortgage on the lands i offered as security has been executed to the bank. The interest rate on these European land mortgage loans is uniformly 4 per cent per annum; the annual amortization payment to gradually pay off the principal in 50 years, is one-half of one per cent, and the usual charge made by the bank for handling the loan, is one quarter of one per cent, which makes a total an nual interest charge against the bor rower of four and three-quarters per cent. The amortization payments each year gradually reduce the amount of interest. In some instances these farm axe made for periods of 20, 40 and 60 years, the table of the a mortization payments being regulat ed to meet the period of the loan. Against these mortgage loans bends are issued by the banks, which are guaranteed not only by the underlying security of the land mort gage, but by the entire assets of the bank: In some countries the govern ments guarantee these bonds in ad dition to the securities already stated. The land bonds are sold in the open market to all classes of investors, and are by law made as safe for the in vestment of trust funds and savings deposits as are government bonds. These European land mortgage banks are prosperous institutions, and.„my investigations did not disclose the record of a single failure among them in any of the countries visited. Where the gorernment furnished the foun dation capital for these banks they are non-dividend-paying institutions, all the profits which are accumulated going into the reserves and thereby j increasing the resources for addition al loans. There are likewise joint ! stock land mortgage banks, which aie very profitable and pay good div idends each year to their stockholders | besides accumulating splendid re iser ves. Hundreds of millions of dollars have been loaned to farmes ! under this system of financing agri ! culture, and the commercial banks of the European countries are in no wise antagonistic to these land mort gage banks. The result of this system of farm finance, based upon long ti ne loans, low rates at inrerest and amortiza ti n, with land as security, has been ■t< revolutionize agriculture in Euro pean countries and has had the effect of placing the business of farming j upon a modern progressive and prof itable industrial basis. The Eurc-j pean farmers are therefore, far a- i of the American farmers in the m:th \ ods employed in the cultivation and j fertilization of the soils, the yields of crops per acre, systematic mark eting of their products and the co operative purchase of their supplies j Their entire business is carried on upon a strictly spot cash economic basis. Being able to secure am ple cash capital through the liquifica tion of their landed assets, the farm ers of Europe are able to economize the production of crops,organize eo- operative marketing societies and to own and operate great supply stores where their needs are secured at the lowest possible prices. There are no supply merchants in European eountries who sell to farmers on credit as we have in this country. The European far mer could not exist under such a system. It violes every law of eco nomics and will ultimately work out in disaster for every farmer who is subjected to its influences. The Reiffeison System For the small European land-own ers and tenants the system of rural banks bearing the name of Reiffeison the originator of them, has been most successfully organized. These smali | banks supply the requirements of short time loans of six ar.d twelve months’ duration, and in some in stanese.for a longer period. They are organized by farmers in local com- munities, practically without capital, and are non-dividend-paying institu tions. They receive deposits from o itsider.-, but grant loans only to tneir members. They are known as banks of unlimited liability. 1 e -ause tin men.tiers <f the institution a;e j'nntly and severally liable for an urn made to a member. Kenceeae:: mem be is closely watched 'egardifij. hi energy, morals and inp-^ritfr. Each small Reiffei-on bai k is fed- 1 erated with a large central bank, or ganized to rediscount the paper of the smaller banks, and which in turn is connected with the big state bank of issue; so that, in case a loan can -1 not he promptly granted to a ! cause‘of insufficiency of funds, the I note is indorsed by the brnk, obligat- I ing all the membership for its pay ; ment, and then sent up to the cen tral bank has not sufficient funds to rediscount the note owing to heavy demands for loans, the note is again . indorsed by the central bank and forwarded to the state bank of issue, where the final rediscount is made and the needed funds at once sup plied. Here we find a system of pyramid banking for the small farmers lead ing upward from the little commun ity banks through the larger central banks with which they are federated to the government banks of issue. In times of depression from tempoary crop failures or money tightness from any cause, the government provides a cheap, simple and elastic system of rural credit which relieves the farmers from the embarassing pressure of creditors and funishes ample capital to meet their needs at all times. There are many thousands of the small Reiffeision banks in op peration in all the countries of Eu rope, doing an annual business of hundreds of millions of dollars upon a prefectly safe and sound basis,and supplying a medium of help to small farmers which could not possible be secured through any other source. The annual rate of interest on these short time loans is uniformly 4 per cent, and under this system of rural member by the small bank be-credita thousands of tenant farmers have been able to buy and pay for small farms and thereby become happy and prosperous landlords, the best asset any ration ever posessed. Farm Production The cultivated farm lands in the European countries I visited are maintained up to the highest point of fertility. The area of farm land cultivated per family is small, aver aging about one-third of the acreage j planted per family in the South. The ' most of the farm work is done by hand, and the ox is the usual draft j animal employed on the farm. The hand is deeply plowed, thoroughly I pulverized and a splendidly prepared ! seed bed arranged before the crops are planted. A perfect system of | diversification is strictly adhered to : a change in crops, planted on the dif ferent plats, being made each year. | Nearly every farm is stocked with | cattle, ar.d the barnyard manure is | carefully preserved and spread over the soil. The most fertile land I saw was in those sections where cattle were m st abundant, while the most unproductive lands were in sections ! where Lut few cattle were kept. No matter how heavy the application of i commercial fertilizers, it has become an established fact, from long exper ience. that real soil improvement could not be built up and maintaind without cattle and barnyard manures European farmers use commercial First Class Auto Service. * V !>-i ‘ ;fr ‘* *' *• . ALSO AGENTS FOR STUDEBAKER, CHALMER l fertilizers quite extensively, even up lon a greater .scale than the farm j ers of this country. As an illustration of this fact. I call attention to the use of potash by German farmers. Practically all of the potash used in commercial fertilizers throughout the civilized world comes from the great under ground deposits in German mines. One-half of the entire output of the potash mines in Germany each year is used up by German farmers on their cultivated lands, one-fourth comes to this side of the Atlantic for use by American farmers, and the other fourth goes to other agricul tural countries in Europe; hence German Farmers use twice as much potash as do all the farmets of Am erica combined, and as much as Am erica and all other agricultural coun tries combined. But their method of cultivation and fertilization gets results. I saw fields of growing, wheat in northwest Germany that would thrash seventy-five bushels of grain per acre, and fields of oats that would yield 125 bushels per acre. The average yield of wheat in Ger many is about forty bushels per acre on lands which have been in constant cultivation for the past thousand years, while the average yield of wheat per acre in this county is from twelve t© fourteen bushels per acre, and the stumps of the trees from our virgin forest are still standing in the fields. The difference in yield is due to the scientific culture and fertilization of the soil by the German fanners and to their system of crop rotation, the heavy use of barnyard manure and the intensive methods of planting. There are no barb wire fences in Europe, very little pasturage'&nd no waste land. Cattle generally are kept in stalls, well bedded with wheat rye, or oat straw. Residences, barns and outbuildings are constructed of brick or stone and generally thatch ed with wheat straw’. I saw roofs of buildings covered with straw which had withstood the storms of fifty winters and w’ere still in good con dition. The barns are large and roomy and generally constructed as an extention of the dwelling, so that the farmer’s residence and barn are all under the same extention roof. The principal field products are wheat, oats, barley, rye, alfalfa, clover, sugar beets and vegetables. Live stock is a leading industry, and nothing but pure bred animals are kept on the farms. Graded stock has practically played out. In all of the fifteen countries vi. ited 1 did not see a single Jersey cow. The average European farmer de pends upon the dual purpose cov; a cow 1 red* for milk and butter, and aiso f beef. Ti e finest t catue m tne w<>nd oi tms type are large b’ack and white i o vs of H< band and Germany, known in this country as the Holstein-Friesan breed. These cows weigh fr >m 1,40(1 to 1,600 pounds and sell on an average for S2OO per head for milking purposes ar.d for about $l6O per head f. r beef. Marketing and Buying In Germany alone there are more than 60,(»00 co-operative farmers’ societies. When it is considered that Germany is hardly more than twice the size of Georgia, we can j have some conception of the extent ; to wich European farmers are organ l ized. These societies are organized strict ly for business and are regularly chartered, with ample working cap ital, rules and regulations to carry on each special line of industry in which they are engaged. 1 visited and personally inspected some of their large dairy manufacturing fac tories in Germany and Holland. At these establishments butter and cheese are manufactured in large quantities. All the capital invested in these plants is owned by the far mers in the surrounding territory, stock being issued on the basis of the number of cows owned and milked by each farmer. Milk from these farms is delivered daily to the facto ry. The cream is at once separated from the milk, which is then deliver ed back to each farmer, who takes it home to be fed to the calves and pigs. A well equipped laboratory is operated in connection with these factories, where the milk from each farm is tested for butterfat twice each week, and if the butterfat in the milk falls below a certain fixed percentage of, say 3 per cent, the owner is notified to give more atten tion to the feeding of hie cows, and a second failure will bring about the imposition of a heavy penalty. Like wise the milk is tested for cleanliness by straining samples through cotton for the detection of particles of dirt, trash, etc. The products of these factories are shipped to large con sbming centers and delivered into the hands of the retail trade by agents in the employ of the factory so that the middleman has been discarded entirely. The same system of business ap plies to the societies of truck, grain and live stock growers. The farmers i through co-operative effort and the : ability to secure abundant supplies of cash capital, market their products and distribute them through their own representatives to the various towns and cities for consumption. They regulate the supply to meet the | demands of consumption, and, know ling the market value oi their pro j ducts, so manage the sales as to make good profit on their industry. If the methods of these European farmers could be applied to agricul ture in the South, our cotton grow ers would soon become the most pros perous and independent farmers in the world. Aside fr.-'in marketing and distri buting. Europe in farmers have learn ed the economic advantages of co operative l uyir g. In practically eve: y large agricultural country which 1 visited 1 had the opportunity of in specting a great supply More, < wn- ; | and operated by farmers, in the oby' Co. ti rued on page seven