Hon. W. B. WILSON, Chairman Committee on Labor, UNIVERSITY OF VIRGINIA, Charlottesville, Va., April 22, 1912. House of Representatives, Washington, D. C. DEAR SIR: I regret very much that sickness in my family will prevent the acceptance of your invitation to be present at the hearing of your committee on the bill to encourage industrial education in the secondary schools. I believe that this proposition will have as far-reaching influence on the future girl and boy as has the agricultural work done by the colleges of agriculture in making more intelligent farmers. Even as great as is the practical value of this kind of training, it is not so great as is its social value in training thinking citizens, by giving training which they continually apply, and hence think about outside the school as well as inside. Very truly, yours, Hon. W. B. WILSON, Chairman Committee on Labor, R. M. BIRD, Professor of Chemistry. RHODE ISLAND STATE COLLEGE, House of Representatives, Washington, D. C. DEAR SIR: I regret sincerely that, while I heartily approve of the general ideas contained in your bill, and hope during my lifetime to see them enacted into law, I can not feel that there is yet a sufficient body of public opinion united and enthusiastic for the provisions of this bill or even for the main idea of having the General Government enter upon the territory of the secondary schools, to give the vitality required for passage through the present Houses of Congress. You, of course, are much better informed on such matters than I am, and perhaps I have no right to express to you any opinion. It is right, however, for me to say that on a recent visit to Washington, in discussing the Page bill with some of those with whom I personally might possibly have some influence, I found the feeling very strong that such a measure is too complicated, too comprehensive, and in many of its parts too antagonistic to the susceptibilities of the people of large parts of our country to command their support. I therefore write, with regret, to say that I do not see how my appearance at the hearing could be helpful. Thanking you for the courtesy of writing me, I am, Very truly, HOWARD EDWARDS, President. COOPERATIVE LAND-MORTGAGE BANKS. COMMITTEE ON AGRICULTURE, The committee met at 11.50 o'clock a. m., Hon. John Lamb (chairman) presiding. The CHAIRMAN. We have arranged a hearing this morning to consider Senate joint resolution 75, to provide for the appointment of a commission to investigate the operations of cooperative landmortgage banks and cooperative rural credit unions in other countries. [S. J. Res. 75, Sixty-second Congress, second session.] JOINT RESOLUTION To provide for the appointment of a commission to investigate the operations of cooperative land-mortgage banks and cooperative rural credit unions in other countries. Resolved by the Senate and House of Representatives of the United States of America in Congress assembled, That the President is hereby authorized to appoint, by and with the advice and consent of the Senate, a commission of three members, not more than two of whom shall be of one political party, to investigate the operations of cooperative land-mortgage banks and of cooperative rural credit unins in other countries; compensation of the members of the commission shall be five thousand dollars each. Said commission is hereby authorized to employ such clerks, stenographers, and other assistants as may be necessary, which employees shall be paid such compensation as the commission may deem just and reasonable, upon a certificate to be issued by the chairman of the commission. For the purposes of its investigations the commission shall be authorized to incur and have paid upon the certificate of its chairman such expenses as the commission shall deem necessary: Provided, however, That the total expenses authorized or incurred for compensation, employees, and otherwise shall not exceed the sum of thirty thousand dollars. Said commission shall, not later than one year after appointment, submit a report to Congress, embodying therein recommendations as to how the systems of such land-mortgage banks and rural credit unions may best be adapted to the needs and requirements of the people of the United States, and at that date this commission shall cease to exist. Passed the Senate May 7, 1912. CHARLES G. BENNETT, Secretary. By H. M. ROSE, Assistant Secretary. As you will recollect, we had some discussion of this indirectly one day in connection with another matter, and ex-Gov. Herrick, of Ohio, had something interesting to say along this line. We also have before us House resolution 294, introduced by Mr. Lever, and I will ask Mr. Lever to present the gentlemen who are to address the committee. Mr. LEVER. Mr. Chairman, I desire to present Mr. C. W. Burkett, editor of the American Agriculturist, of New York. STATEMENT OF MR. C. W. BURKETT, EDITOR OF THE AMERICAN AGRICULTURIST, OF NEW YORK. Mr. BURKETT. Mr. Chairman and gentlemen of the committee, I desire to call attention to the committee report to the British Government, in which the following statement was made: Cooperative credit, as illustrated in the People's Bank of the Raiffeisen and other patterns on the Continent, is a modern discovery which may be likened, as a factor in production, to the discovery of steam. This whole subject of cooperative mortgage banks and rural credit associations has created an immense interest in this country, especially among the farming people in our section of the country. It is not my purpose, in the few remarks I will make to-day, to enter into a description of the different systems of these mortgage banks as operated in the European countries, but I have heard a great deal about the cooperative banking systems. For instance, the popular banks and the Raiffeisen banks of Germany in 1909 did a total business of $1,800,000,000, or something like 18,000,000,000 marks. Now, that is an immense help and aid to the farming population. Ex-Gov. Herrick said not long ago that the German Emperor had said the Raiffeisen banks had done more for Germany's industrial development than any efforts that had been made in any direction. The situation in this country is this: We have built up our city institutions; we have built up our railroads and our industrial enterprises, and every sort of institution or enterprise of an urban nature has had legislation and the direction of our best and ablest men. In agriculture there has been individual action; but when it comes to the building of a railroad, or a certain body of capitalists desire to put through a railroad, they establish their enterprise by providing for cooperative effort and everybody chipping in a little by buying bonds or stocks, or something like that, and then the thing is put through. These bonds may sell for 4, 4, or 5 per cent, depending upon the safety and other conditions that are back of them. Supposing several farmers desire to put through a drainage enterprise. Can they issue bonds on that drainage enterprise? There are no means under the sun to-day whereby farmers have any opportunity for cooperative effort in order to get through some of their cooperative enterprises. Mr. MAGUIRE. Yo do not deny that they have the right to organize a drainage district under the drainage laws in the different States and issue bonds? Mr. BURKETT. There are in certain sections laws providing for the organization of drainage districts. North Carolina is one of the States, but in New York we can not issue bonds. I have a little farm up there I would like to drain, but there is no provision for it under the State law. Mr. WICKLIFFE. You could do it, however, by securing the necessary State legislation, like they do in any other State where they have a law providing for the organization of drainage districts. Mr. BURKETT. In some places they had large areas which were to be drained, and they have passed laws providing for that; but, for instance, in places like New York, there are lands there which require drainage, but they are only a small part of the territory, and no laws have been passed. Mr. RUBEY. We have drainage districts in Missouri, under our law. Mr. TALCOTT. You are speaking of individual farmers. Mr. BURKETT. The individual farmers; exactly. Supposing I wished to develop my farm and I had to have a little more money; the only way I could get it is by going and have a mortgage placed upon the farm, and in order to obtain this money I will have to pay higher rates than the municipal enterprise that wants to borrow money. The municipal corporation which desires to put in a system of waterworks can issue bonds, and the credit of the city is in back of that enterprise. They can sell those bonds at a rate of interest around 4 or 4 per cent. If I wish to raise some money to carry on my farm operations, I have to go to a bank and give a personal note, bearing one or two names, or else place a mortgage on my farm, and I can not obtain the rates which the city enterprise can. Now, these credit organizations in Europe simply permit the farmers to get together and give their own personal credit, through their association, and borrow this money. As I stated a moment ago, $4,800,000,000 represents the total business of those banks in Germany in 1909. That would mean to our farmers if a body of, say, 10, 20, 30, 40, 50, 100, or 200 of them would get together in a partnership and desired to carry on something and to borrow money for this enterprise, that they could obtain this money on exactly the same basis as the municipality could obtain the money-at the same rate of interest. Mr. MCDERMOTT. What do they have to pay in the old country? Mr. BURKETT. Three and one-half to four and one-half per cent. Mr. LEVER. What is the general average for farm loans in this country? Mr. BURKETT. They run all the way from 5 to 8 per cent. Mr. BURKETT. In certain sections of the South and West-is there any gentlemen here from Kansas? Mr. TAGGART. I am from Kansas. Mr. BURKETT. What are the mortgage rates in Kansas? Mr. TAGGART. You mean for borrowing money on farms? Mr. TAGGART. I have not known of anything less than 6 per cent. Mr. TAGGART. Yes; 7 is quite common. There may be cases where the security is very excellent, and at certain times, when they might secure money at a little less than 6, maybe 5; but I have never known of any loans being made at less than 6 per cent. Mr. MAGUIRE. In Nebraska they are loaning money on mortgages at 5 per cent. Mr. TAGGART. That might be true in Kansas. You know I live. in the city. Farther out in the country they might get loans for 5. Mr. SIMMONS. May I ask if the rate of interest for loans on farm property is any higher than the rate of interest for loans in the city? Mr. TAGGART. Not so high. They loan money at 8 per cent in the city there on homes. They have done it and they do it. Seven per cent is very good. Mr. BURKETT. The mortgage rate in New York City, I should say, is 5 and 6 per cent. |