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THE BANK'S PART IN
THE FARM PROBLEM
By H. LANE YOUNG
Member American Bankers Associa¬
tion Agricultural Commission
/■\NE of the most discussed and least
understood questions regarding
the farmer’s problems is the part the
bank has played,
or is to play, in
financing the
farmer. The basis
of co-operation
between the two,
however, is a very
simple one.
Both sides are
subject to criti¬
cism for the con¬
dition that exists
today. The major
share of the blame
, rests on those
banks that have
failed through disregarding funda¬
mental principles in loaning other
ipeople’s money, that have encouraged
the farmer to expect bank loans with¬
out first putting his business on the
• earning basis which would justify a
bank to lend him money.
One of the underlying reasons for
the failure of so many country banks
has been the existence of too many
banka. With the limited business of
the commmunity divided among too
many banks it was impossible for them
to make enough money to justify the
employment of officers with the proper
ability to manage the bank success¬
fully. Then the scramble for business
was so hard that good judgment and
foresight were forgotten in granting
loans, with the resultant failure of
the weaker institutions.
*’ In the future, banks are not going
to loan the money of their depositors
without the kind of security that can
be immediately realized upon in case
the loan is not paid, or unless the ap¬
plicant presents a sound and success¬
ful record of business operation—
whether that business be manufactur¬
ing, merchandising, or farming.
Farming-Banking Interdependent
This is a perfectly obvious attitude,
because country banking cannot be
successfully and profitably carried on
unless farming is successfully and
profitably operated—the two busi¬
nesses are dependent upon each other.
There Is no longer any question that
the time has arrived for these inter¬
dependent businesses to reach a com¬
mon ground of understanding of the
requirements that both must meet for
their mutual welfare.
There is no doubt but what the fu¬
ture prosperity of the farmer and the
basis of cooperation between banker
end farmer is the intelligent diversi¬
fication of crops. It is necessary, how¬
ever, to have the right conception of
diversification.
The mistake that many farmers
have made in attempting to diversify
has been to invest too much money,
time and land in a new and untried
crop—sometimes a hazardous crop, or
one for which no immediate market
has been developed, resulting in a loss
of the Initial effort and discourage¬
ment of future efforts on a more con
eervative basis.
i Disregarding the primary and essen¬
tial principle of farming—namely, In¬
creasing earnings by decreasing the
cost of production through the prac¬
tice of building up soil by crop rota¬
tion and intensive cultivation, Is re¬
sponsible for a. large share of the
farmers’ trouble today.
An Agriculturalist
Sees Farm Board’s Job
The new Agricultural Marketing Act j
approaches farm relief from a materi¬
ally different point of view from that
of former bills before Congress in re¬
cent years, says Dean ILL. Russell of
Wisconsin University College of Agri¬
culture in the American Bankers As¬
sociation Journal.
“It contains a new idea,fraught with
the greatest possibilities—the organi¬
zation of a Federal Farm Board,’’ he
says, “It has been possible for farm
cooperatives to borrow from Federal,
aided institutions before, and at a ma.
terially lower rate than city business
pieit had to pay for working capital,
tut this is the first set-up made by
the government in which a commis¬
sion has been carefully chosen to give
undivided attention to an effort to
solve the problems of a farm group.
“It Is hard to conceive of a higher
degree of responsibility than must he
assumed by this commission, L T o board
ever created by congressional action
Jia 3 been clothed with as wide plenary
powers. It is authorized not only to
advise hue to execute, to plan and put
its plans into effective action, to buy
and hold, to dump, to dip into the
Federal treasury to accomplish its
ends with what would be almost un¬
limited resources to any private com¬
mercial concern. The board’s only
' job ie tp succeed, and no govern¬
mental agency even during the war
tiihe emergency had a wider latitude.
“Many will think the farm relief
program will he universally applicable
to the individual land owner or oper.
Btor. Such procedure is far from the
case. Aid is to be extended through
cooperative organizations by making
it possible for such groups to obtain
cash advances to hold crops so as to
permit of more orderly marketing.
“While the primary relation Is with
cooperatives, the Individual or unor¬
ganized farmer will also profit by the j
activities of his organized fellorzs. If
» stabilized program of merchandising
is able to eliminate the surpl uses
(
J
H. Lane Young
exert such depressing influence on
prices the general price relation
j [ individual should be improved. If this occurs the
farmer should also benefit.
“It is here the government is pro.
posing a novel attempt in economics.
Through stabilization corporations for
each commodity it is proposed to
make possible the handling of the
surplus so as to lessen its disturbing
influence on prices. With non-perish¬
able products such a program is, of
course, conceivably possible,' but one
wonders what would happen if a sta¬
bilization corporation had to handle a
perishable crop in great quantities.
“Is it going to he possible for a sta¬
bilization corporation to stabilize? It
would be one thing if it had merely to
stabilize the American situation, hut
often that situation is cfimplicated
with world conditions. Perhaps the
very fact that such a stabilization cor¬
poration is in position to function may
have a steadying effect on the market.
“Markets respond to psychological
stimuli as do individuals. The very
fact that the government has now def.
initelv stepped into the breach with
ail of its resources available to make
the new plan work will exert un¬
doubtedly a strong stabilizing effect.
"It would be presumptuous to fore¬
cast. what the ultimate effect of the
new act will be. It can, however, be
definitely stated that in the present
plan much of the philosophy that had
been so drastically criticized as eco.
nomically unsound has been elimi¬
nated. The <#cisting plan is worth
trying. It will undoubtedly cost the
Federal treasury no inconsiderable
amounts of money, but if it. produces
the hoped-for result it will have been
well worth while.”
BANKING FINDS THE
WAY TO SAFER ERA
By FRANK W. SIMMONDS,
American Bankers Association
In considering the banking situa¬
tion throughout the country, the fact
should be kept in mind that while one
bank In - ten failed during the past
eight years,- it is far more important
that nine hanks out of ten, operating
in the same general field, serving the
same communities and meeting al¬
most identically the same problems,
weathered the economic storm of re¬
adjustment successfully. This achieve¬
ment cannot, he ascribed to any ele¬
ment of luck, but rather to consistent
adherence to sound banking principles
and profitable practices. Through
worthy and efficient management they
met the issues and problems confront¬
ing them, squarely and successfully.
Banking Is regarded as tho keystone
of our entire business structure, hence
bank failures are rightly regarded as
intolerable public calamities that must
absolutely be prevented. The three
major objectives of all inter-bank or.
ganizations, whether local, county, dis¬
trict, state or national, are to make
banking safer for all concerned and,
through increased' efficiency in bank
management and supervision, to lessen
or eliminate all forms of losses so that
greater rewards may accrue to bank¬
ing and better service to the public.
There is definite evidence throughout
the country of a strong and growing
spirit of cooperation among bankers
and banking organizations, which is
resulting more and more in strength¬
ening the work of all.
Clearinghouse associations among
banks in city, county or district groups
undoubtedly constitute the chief line of
defense against bad banking practices.
They have demonstrated that they are
the principal factor in bringing about
reformation in banking regulations,
improvements in banking methods and
the observance of sound banking prin¬
ciples. For many years the primary
purpose of a clearinghouse association
was the clearance of checks, hut today
it Is the clearance of banking ideas
and the solution of banking problems.
Clearinghouses supply the local ma¬
chinery essential for setting up and
putting in practice necessary stand¬
ards and uniformities. There are now
435 clearinghouse associations in cit¬
ies, towns, counties and groups of
counties in the United States.
Men today are more intelligently
group-minded than ever before. Bank¬
ing is combining the best elements of
competition with sound group action.
By virtue of this combination, individ¬
ual thought has much wider possibili¬
ties of expression. In general, group
action has not stifled hut has stimu¬
lated individual thinking and initia¬
tive. Better inter-hank organization
and relationships afforded by clearing¬
houses would have undoubtedly saved
many institutions that have suffered
failure hi the past. The clearing¬
house activities of the American Bank¬
ers Association are conducted for the
purpose of encouraging ever widening
cooperation along fundamental princi¬
ples and practices among hanks
through clearinghouse associations.
Bankers in every city, county or dis¬
trict can, through the agency of a
clearinghouse, promote better, safer
and more profitable banking and also
serve their communities better.
There never was a time when suc¬
cessful bankers were so alert to the
value of team work for putting tho
entire banking structure in prime con¬
dition. Sound hank management is
the order of the day. Constructive
cooperation is more than a sentiment,
ft is an economic necessity, a matte;
of enlightened self-interest, and suc¬
cessful bankers more and more are
utilizing the agency of constructive
group action in developing and estab¬
lishing necessary standards and uni¬
formities in banking practices. Each
year banking is becoming more of a
science and attaining higher profes.
cl ona l standards.
J THE CLEVELAND COURIER, CLEVELAND, GEORGIA.
r On the Safe Sid.
There are so many “unsafe’’ things
around a home. If a mother will think
of such things, serious injury is spared
the baby at its Investigating age. She
can teach the older children to co-op¬
erate with her In keeping sharp objects,
such as pencils, scissors and knives
from the baby’s grasp. Medicines and
matches may be kept on a high shelf,
and while cooking, the handles of pans
should not be left In such a position
that baby can grab at them and spill
the hot liquid. Eternal watchfulness
Is the price of safety!
Old Roman Sacrifice
Tiie relief of Anaglyphs Traiani In
the Roman forum represents the sac¬
rifice of the bull, sheep and pig which
usually accompanied the purificatory
ceremonies or lustrum. Efaeh animal
represents a valuable part of the farm¬
er’s stock. The ceremonies generally
took place at the close of the census
and for the army at the beginning
of a campaign and probably also in
connectibn with the founding of tem¬
ples and other similar occasions. The
animals were led around the assem¬
bly and then sacrificed.
Not to Be Expected
An actress was traveling to the
seaside to join a concert party. At
the London station the porter cast a
disapproving eye upon her large quan¬
tity of luggage and intimated that she
would have to pay “excess” unless she
was a theatrical artiste.
“That’s exactly what I am,” said the
girl.
“Well, then, miss,” said the harried
man, “why didn’t ybu say so at first?
I can’t go about all day long insulting
passengers by asking them if they’re
actresses.”—London Answers,
Change* in Moon
The dark of the fnoon is the Inter¬
val of a few days of invisibility when
it is near conjunction with the sun.
The moon at that time is between
the sun and earth, and nearly lu a
line with them, the nntUumlnatcd face
of the moon being presented to the
earth. In relation to the moon’s
phases, this period comes between the
last quarter and the new moon.
>s Up
U nder Fire.
Up and down race the pistons—like the rapid-fire of a
machine gun. Steady barrage of explosions in the cylin¬
der! Searing heat! It takes a TOUGH oil to stand up
under fire in a modern motor. And PAN-AM is tough*
sturdy, safe. Moving metal parts are properly lubricated.
Test PAN-AM motor oil for yourself. You’ll find SAFE
lubrication, courteous service at any PAN-AM sign.
PAN-AM PAN AMERICAN PETROLEUM CORPORATION
PAN-AM
MOTOR OILS
Mustn’t Keep Shifting
It’s all right for u young man to
start at the bottom of the ladder if
he doesn't keep moving around from
one ladder to another.—Los Angeles
Times,
Great Auk in Museum
An assembled skeleton of the ex¬
tinct Great Auk, the huge bird onc-e
quite common in North America, is on
exhibition at the Field Museum of
Natural History, Chicago.
Mechanical Stuttering
The height of curiosity would seem
to have been reached by the man who
tvants to hear what a slow-motion talk¬
ing picture would be like.—Portland
Oregouian.
Defining the Millennium
One definition of the millennium
would be the day when,tlie found ad¬
vertisements equal the lost.—New
York Sun.
Strain I* Right
Tlie way some families keep up a
front imposes a great strain on the
shops they deal with.—Rutland Daily
Herald.
Generous
The main difficulty about people who
borrow trouble is that they want to
pay back more than they borrow.—
Gloversville Leader-Republican.
You Can Get Stuck, Though
The difference between ticker tape
and adhesive tape is that the latter
has no quotations on it.—American
Magazine.
Marked Era in Warfare
Poisonous gas w as first used during
the World war at Ypros on April 22,
1915, when the Germans usod chlorine
gas.
Big Demand for Paper
One hundred and eighty pounds of
paper is the yearly requirement of
every individual in the United States.
Long Length of Web
A spider lias been known to spin a
thread almost 20 miles long.
A Dollar Dinner for Four
Escalloped Salmon with Lima Beans and NoodUs —54f
Radishes and Sliced Cucumbers —15^
Bread and Butter—
Blackberry Ice-Cream —19^
Black Coffee —
4 7C ‘jlTOUR 'll cellent people may have an ex¬
: dinner at home for a
1 dollar—a quarter apiece—if the
marketing is carefully done and the
various items of the menu skilfully
combined.
To make the salmon dish, remove
:he fish from a tall can (28 cents)!,
•emove skin and hones, and place as
whole as possible in the center of a
urge, shallow baking plate. Make
i sauce of one and one-half table¬
spoons blitter, two tablespoons flour,
one cup milk, liquor from the can
and salt and pepper. Pour over the
salmon. Cover with one-third cup
-runibs buttered with one tablespoon
of butter and sprinkle two table¬
spoons grated cheese over; bake in
a hot oven until brows. Meanwhile,
have half a six-ounce package of
egg noodles cooked, drained and
seasoned anti half of a number 2
can of lima beaus heated. Arrange
these in a border around the cilmnn
This dish makes the whole main
part of the meal, supplying meat,
starchy cereal and vegetable, and all
its ingredients cost only 54 cents.
For the ice-cream, scald together
contents of a six-ounce can of evap¬
orated milk, one-third cup sugar
and two tablespoons water, and cooL
Add two tablespoons lemon juice
and one eight-ounce can of black¬
berries mashed and pressed through
a coarse sieve. Freeze as usual*