HDi483 Al Ai ,1 ;■ New York State College of Agriculture At Cornell University Ithaca, N. Y. Library Cornell University Library HD 1483.A2 American commission for the study of the 3 1924 013 995 331 D Congress 1 „„„ . „„ f Document Sd Session / bJiJNAlJi | ^^^ ^^^^ AMERICAN COMMISSION FOR THE TUDY OF THE APPLICATION OF THE CO- OPERATIVE SYSTEM TO AGRICULTURAL PRODUCTION, DISTRIRUTION, AND FINANCES IN EUROPEAN COUNTRIES UNDER THE DIRECTION OP THE SOUTHERN COMMERCIAL CONGRESS f PRESENTED BY MR. SMITH OF GEORGIA Feb.buaky 11, 1913.— Ordered to be printed WASHINGTON LlDRARt FEB 4 iM6 DEPT. OF AGRIC. ECON, FOREWORD. The following pages were prepared by The Southern Commercial Congress in order to make known the public considerations which led to the decision to appoint an American commission to inquire into the organization of agricultural business in Europe. It has been thought well that I should explain briefly how the project which has received such remarkably influential support came to assume its present shape. The researches of the International Institute of Agriculture in Rome, Italy, had demonstrated the immense importance which Governments on the Continent of Europe attach to the employment by farmers of the best business methods which it would seem are by general consent cooperative. Hon. David Lubin, the American delegate to the institute, had in numerous publications impressed upon the American public the importance of an improved system of agricultural credit, which, probably owing to his advocacy, figured prominently in the presidential campaign, each of the three parties making it part of its constructive policy. This gave rise to a non- political movement aiming at a thorough European inquiry as a preliminary to legislative or other action. The President summoned a conference of the governors of the States at the White House on December 7, 1912, for the consideration of this question. The interest aroused led to a widespread feeling that the scope of the Jnquiry should be broadened. The instructions, which are printed in the following pages, will explain the precise nature and purpose of the investigation which is to take place. It is hoped that as the result of the publication of this and the other documents the commission, which is to set out on the 26th of April, will carry to Europe two delegates from every State in the Union and thus be truly representative of the Nation at large. In conclusion a word may be said as to the nature of the support received from both sides of the Atlantic. The commission has been indorsed by the House of Governors, and also by the President, the President elect, and the ex-President, whose letters are printed as a part of this document. We further call attention to the letters and documents prepared by Hon. David Lubin and to the remarks of Sir Horace Plunkett, who speaks as the representative of that branch of the English-speaking peoples which has made its own investigations into continental agricultural systems and has learnt its own lesson therefrom. With such evidence before us we can not doubt the im- portance of these questions. Respectfully submitted. Clarence J. Owens, Managing Director, The Southern Commercial Congress. GENERAL INSTRTTCTION TO THE COMMISSION. The inquiry will embrace an exanaination of the methods employed by progressive agricultural communities in production and marketing, and in the financing of both these operations. Special note will be taken of — First. The parts played, respectively, in the promotion of agri- culture by the Governments and by voluntary organizations of the agricultural classes. Second. The application of the cooperative system to agricxiltural production, distribution, and finance. Third. The effect of cooperative orgamzation upon social conditions in rural commimities. Fourth. The relation of the cost of Mving to the business organiza- tion of the food-producing classes. Notes on Itinekaey of the American Commission. Sir Horace Plunkett will cooperate with Mr. David Lubin in map- ping out the itinerary. The commission will leave New York on the 14,000 ton steamship Saxonia, of the Cunard Line, April 26, reaching Naples on May 10. The itinerary includes the followiag countries: Italy, Hungary, Austria, Germany, Denmark, Sweden, Holland, Belgium, France, England, and Ireland. The party will spend 70 days on land, divid- ing the time among the above countries. The contract with the Eager Tours Co., J. Howard Eager, manager, Baltimore, Md., which wiU manage the trip, provides for the pay- ment of $50 when the steamer reservation is made, the balance, $1,150, to be paid not later than March 15, 1913. The treasurer of The Southern Commercial Congress is placed under- special bond to handle this fund. First-class accommodation in outside rooms will be provided for the party, going and returning. The commission will return on the Cedric, of the White Star Line, which leaves Queenstown July 18. First-class hotel accommodations, three meals per day, transporta- tion of one steamer trunk and one suitcase per passenger, aU necessary carriage drives, with transfers to and from all hotels, all tips to hotel and railway employees, and all ordinary fees will be cared for by the Tours Co. A number of very desirable staterooms have been reserved for outward and return passage, and will be allotted strictly in order of application. It is, therefore, desirable that the preliminary deposit of $50 be forwarded at once. On May 10 a reception will be tendered the American commission in Rome and will be attended by King Victor Emanuel and Queen Helene. AMERICAN COMMISSION FOR THE STUDY OF THE APPLICATION OF THE COOPERATIVE SYSTEM TO AGRICULTURAL PRODUCTION, DISTRIBU- TION, AND FINANCES IN EUROPEAN COUNTRIES. Resolutions Adopted at Fourth Annual Convention of the Southern Commercial Congress in the Conference on Agricultural Finance, April 1-6, 1912. Whereas the solution of the problems of rural finance lies at the basis of every attempt to improve rural conditions; and Whereas the latent wealth of the farmer can only become active wealth through the possibilities of credit freely obtainable on the basjs of his character and his assets; and Whereas there are in operation in Europe the following systems and their variants, namely, Raiffeisen, Schulze-Delitzsche, and Landschaften; and Whereas these systems have during their existence greatly stimulated rural finance in these European countries; and ■'\- Whereas we are convinced that the systems should be further studied by the United States: Therefore be it Resolved, That we recommend to the directors of the Southern Commercial Congress that a select committee on rural finance investigation, consisting of one or more, but preferably two, members from each State of the Union, go to Europe in the summer of 1912, under the general management of the Southern Commercial Congress, and under the administrative management of an executive committee to be elected by the members of the select committee and under by-laws to be adopted by the committee as a whole; be it further Resolved, That the daily findings of the select committee shall be recorded in such form that each member may return to his State possessed of one copy of said findings for publication and use in his State and that a second copy be given to the Nation through publication to be recommended to the Congress of the United States for general distribution ; and be it further Resolvtd, That we preferably recommend two members from each State for the reason that when the committee returns there will be in each State two men well informed on the whole subject and locally interested in solving the problems of rural finance as presented by the State of their residence, and for the additional reason that a large committee bringing many minds to bear upon the phases of one subject can be expected to produce greater national good than would be possible from investigation by a small committee not individually representative of the States of the Nation and in a measure unacquainted with the varying reeds of the various sections. The convention, by a rising vote, also passed unanimously the following resolution: Whereas the International Institute of Agriculture was established at Rome in 1905 upon the initiate of His Majesty "\'ictor Emanuel III, King of Italy, who provided it with land and buildings and is contributing with prmcely generosity toward its work in addition to the official support and participation therein by Italy, by the United States, and by 48 other Governments, together representing 95 per cent of the world's area and 98 per cent of the world's population; and Whereas it is now realized that the International Institute of Agriculture is doing a work of incalculable value to the world as a whole and to the United States of America: Now, therefore, be it Resolved, That the Southern Commercial Congress, in convention assembled, with 24 States represented, voices the sentiments of the American people in hereby recog- nizing the valuable services of the King and Government of Italy in making possible that great world federation for progress, the International Institute of Agriculture. We trust that the institute may continue to be increasingly successful in securing intei-national cooperation in world crop reports, in disseininating agricultural intelli- gence, in promoting cooperative agricultural finance, in fostering more economic aistribution of the world's agricultural production, and in facilitating better under- standings between the peoples of the earth. 5 ITINERARY FOR THE COMMISSIOIT. LETTER FBOM HON. DAVID liUBIN, AMERICAN DELEGATE TO THE INTERNATIONAL INSTITUTE OP AGRICULTURE, ROME, TO DR. CLARENCE J. OWENS, MANAGING DIRECTOR SOUTHERN COM- MERCIAL CONGRESS, WASHINGTON, D. C. In a recent letter you say: "You will greatly assist me if you will map out the itinerary for the select committee." In reply to your request, I wrote on for the opinions of authorities in the several countries to be visited, stating: The committee will leave New York some time in the latter half of April, to be in Rome during the seseioii of the General Assembly of the Institute, to be held in the first fortnight in May. It will be due in New York on its return journey in the early part of August. Beginning and terminating in New York, the trip is to occupy 90 days time. The ocean voyage to and fro, and spare time, will take about 24 days, thus leaving about 66 days available for the investigation in the European countries. The following are some replies received to the above : OPINION OF THE DELEGATE OF HUNGARY. The delegate of Hungary to the International Institute of Agri- culture, His Excellency, Mr. Edmond de Miklos, writes from Alacsta, Hungary: With regard to the itinerary of the select committee, my judgment would be to make the study in the following countries: Italy, 8 days; Austria, 5 days; Hungary, 5 days; Germany, 10 days; Denmark-Sweden, 10 days; Belgium-Holland, 10 days; France, 8 days; and Ireland, 8 days. Two days could be used here or there, thus making up the 66 days. The best route would be for the committee to go from Italy direct to Hungary, and thence, via Austria, to Germany. My Government will do its utmost to receive your compatriots with the honor due to your fine country and to our old friendship and sympathy. It seems to me it would be advantageous to the outcome of your work to draw up a list of questions and send over that list in January or February, so that the different Governments and associations may be enabled to arrange in advance the best facilities for the study by your select committee. THE OPINION OF THE SECRETARY GENERAL OF THE INSTITUTE. Prof. Giovanni Lorenzoni, Secretary General of the International Institute of Agriculture, writes: The itinerary could be mapped out on the following plan: Italy (Rome, Bologna, Piacenza, Milan, Cremona) ; Austi'ia-Hungary (Budapest via Trieste, Vienna, Prague); Germany (Dresden, Berlin); Denmark (Copenhagen); then back to Germany (Munster, Cologne, Darmstadt, Munich); France (Paris); Belgium (Brussels); Holland (The Hague); Great Britain and Ireland (London, Dublin), and from Queenstown back to New York. COOPEBATIVE SYSTEM OF AGBICULTUBE IN EUEOPE. 7 OPINION OF TIIE PRESIDENT OF FEDERATION OF AGBICULTUBAL CO- OPERATIVE SOCIETIES OF GERMANY. The following is the opinion of Mr. H. E. Haas, president of the Keichsverband der deutschen landwirtschafthchen Genossenschaften, Darmstadt, Germany: It was with great interest that I noted the contents of your letter of July, 1912, with regard to the itinerary of the American committee on their torn- in Europe for the purpose of studying the European rural cooperative credit systems. I also received, some days ago, a letter from the secretary of state for the Interior giving me all the necessary information relating to the proposed tour. • Speaking in the name of the Imperial Union of German Agricultural Cooperative Societies, I shall be most pleased to afford your committee every facility possiVjle to make their tour in Europe, and more especially in Germany, of the greatest service. With regard to the itinerary of the committee, as its purpose is the study of the organization of the cooperative rural credit systems, it is of course understood that kmdred branches, such as cooperative purchasing, dairy farming, marketing, and the other fields of cooperative activity, should only be treated as of secondary importance, leaving the greater part of the time for the study of agricultural credit. It is certainly advisable that the tour begin in Rome, so that the committee take part in the General Assembly of the International Institute of Agriculture, in May, 1912, where they will meet leading experts on this subject who will be in attendance. They can then first study the organization of the Italian cooperative credit systems. Considering the limited time at the disposal of the committee, the tour should embrace only a few countries, so as to enable it to devote as much time as possible in those countries where these systems have reached their highest development. Sub- ject to further consideration, I should propose; Italy, Hungary, Austria, Germany, Denmark, France, and Ireland. I hope that Germany will have the privilege of receiving the committee and that the time devoted to it will not be too limited. As soon as I know how many days are reserved for the stay in this country I shall immediately propose a detailed itinerary for Germany. I attach the greatest importance to the tour, but would suggest for your considera- tion that a subcommittee of the delegation make a longer stay in Germany and in some of the other countries, supplementing, by additional studies, the work done. I suggest this because England and Japan have applied this method with success. Awaiting your answer, I beg to remain, yours, faithfully, H. E. Haas. From the views set forth above, I would suggest that in making up your final itinerary you include the following countries to be visited by the committee as a whole: Italy, Hungary, Austria, Germany, and France ; while subcommittees should visit Russia (St. Petersburg), the Balkan States, Sweden, Denmark, Switzerland, Belgium, Hol- land, and Ireland. For instance, while the committee as a whole is at work in Austria- Hungary subcommittees could be detailed to Russia and the Balkan States, while at work in Germany subcommittees could be detailed to Sweden, Denmark, and Switzerland, and when working in France subcommittees could go to Belgium, Holland, and Ireland. The select committee should also, in my opinion, divide the inves- tigation it is to make into four main branches, with a subcommittee for each of the following: The Raifleisen, the Schulze-DeHtsche, and the Landschaften systems, as well as the Landwirtschaftsrat. These studies again will have to be subdivided under the following heads : Farms, cooperative societies, universities and colleges, Government departments, legislation and laws, credit banks, central banks, and agricultural associations. Besides these there should be a committee on organization, with the following subdivisions: Finance, audit, by-laws, program, report, route. 8 COOPEHATIVE SYSTEM OF AGBICTJLTUKB IN EUEOPB. A plan like this would give the select committee the information on all the various systems in the European countries. At the same time it would give the committee as a whole the best opportunity for investigation in the five principal European centers of rural coopera- tive credit. In view of the importance of Germany for the purposes of this investigation, it seems to me that one month's time should be devoted to that country. I would also suggest that in visiting a country each important section of the same be assigned to a subcommittee, each subcommittee reporting to the committee as a whole on stated occasions. David Lubin, Delegate of the United States, International Institute of Agriculture, Rome, Italy. THE OPINION OF AMBASSADOR MYB.ON T. HEBBICK. [Extract from a letter from Hon. Myron T. Herriek, American Ambassador to France, addressed to the managing director of the Southern Commercial Congress.] I have made a cursory investigation of this subject and have been speaking on it from time to time the last three or four years. Last year I made some investigations which I am contmuing here, at the request of the Department of State, and as a result of all this I have arrived at the firm conviction that the establishment of rural credit system or systems is an imperative need. There is nothing so impor- tant to-day before the American people, in my opinion, not even excepting the currency reform, and it is my desire, therefore, to in some way assist in the estabhshment of a sound economic system in our country at the earliest possible date. Consequently I shall most earnestly welcome your commission on its visit to Europe. I should be pleased to know your plans at as early date as possible in order that I may be in Paris to receive you. [Extracts from letters from Ambassador Herrick to Hon. David Lubin, American delegate, International Institute of Agriculture.] The purpose of all interested is, or should be, to bring to the Ameri- can people information on aU the methods employed in Europe which have proven of value to agricultural interests. It would be a very good idea if we could center all th's work in one organization, such as the Southern Commercial Congress. I think it would be most unfortunate if after the public has been awakened to an interest in this matter, ill-considered organizations should succeed in getting into the field and bringing about a repeti- tion of the farm-mortgage financial disasters of some 25 years ago. * * * Therefore, I am most willing that authoritative warning be made on this point. COOPEEATIVE SYSTEM OF AGEICULTUBE IN EUROPE. 9 THE JURY OF INQUIRY ON THE EUROPEAN COOPERATIVE RURAL CREDIT SYSTEMS. MODE or PROCEDURE OF THE AMERICAN COMMISSION IN ITS TOTTR THROUGH THE EUROPEAN COUNTRIES. (Leaving New York, steamship Saxonia, April 26, 1913.) International Institute of Agriculture, Rome, Italy, January 11, 1913. Dr. Clarence J. Owens, Managing Director, Southern Oommercial Congress, Southern Building, Washington, D. C. Dear Dr. Owens: In response to the request of The Southern Commercial Congress I herewith submit a report, proposing a mode of procedure for the American commission on its tour of investigation in the European countries. The suggestions offered are the result of consultation with delegates to this rastitute and other authorities on the European rural cooperative credit systems. As a preliminary to my statement I wish to observe that it is essen- tial that candidates for appointment as commissioners possess the proper qualifications for the work they are to perform. The impor- tance of this work, the magnitude of the factors to be investigated, and the comparatively short time in which all this is to be done, will afford but little opportunity for sight-seeing or social functions. There will be neither time nor place on this commission for mere junketers, sight-seers, amateurs, or dilettanti. Every working hour during the allotted time at the disposal of the commission will have to be devoted to serious work. the jury of inquiry. In the main, as I have already informed you, the general opinion is favorable to conducting the investigation on the method of a " jury of inquirer. " What IS this "Jury of inquiry" method? It is this: During the various sessions of the American commission in the countries visited, designated members of the European cooperative credit associations, both men and women, will be asked to appear before it and to reply to questions relating to their own experiences as members and cooperators of rural credit associations. The American commission will, in fact, act as a grand jury, and the people who are to appear before it will be of eveiy grade, the renter, the small landowner, the great landowner, the officers of the minor associations and those of the larger associations, and, besides these, the semiofficial and official authorities and their advisors, as well as other parties directly or indirectly affected by these associations. The leading questions and answers at these "Jury of inquiry" sessions will be taken down in shorthand, and embodied in the general report of the commission. The Congress of the United States will be asked to have this report made a "public document," and important sections of the same will be reprinted for general circulation. That the plan just outlined is a necessary step toward the adapta- tion of the European cooperative credit systems to American needs must be obvious to the intelligent inquirer. It is true that up to the S. Doc. 1071, 62-3 2 10 COOPEEATIVE SYSTEM OF AGRICTJLTTJEE IN ETJEOPE. present time much light has been thrown on these systems. In the first place there are the twenty and odd volumes dealing with this subject published by the International Institute of Agriculture. Then there is the inTestigation by the American diplomatic service, and the statement in the letter to the governors by the President of the United States; and, lastly, there was the governors' conference with the President. Is not all this sufficient? By no means; all the information obtained so far no more gives a true insight into the real working of these European credit systems than would be given of the Masonic order or of the Grange by simply publishing their by-laws, the routine of their mode of procedure, or the statistical data concerning them. Only a man high in the Masonic order or in the Grange can set forth understandmgly just what Masonry or the Grange stands for. If outsiders were permitted to enter the lodge rooms of the Masonic order or of the subordinate. State, and national Granges, observe their operations, interrogate their members and officers, questioning them fuUy upon all essential points of informa- tion, and receiving correct answers to these questions, only then would such outsiders be adequately informed on the subject. With this in mind, it is proposed that the American Commission, which is to consist of two delegates from each State, and some "dele- gates at large," do this kind of work by constituting itself into a "jury of inquiry." This "jiu-y of inquiry" will be the best means of obtaining a fundamental, practical knowledge of the European rm-al cooperative credit systems as they are, and of arriving at the best mode for their adaptation to meet the needs of the American farmer. It must be admitted by all who are fair-minded in this investigation, primarily concerning, as it does, the welfare of the farmers, should be taken in hand, by the farmers themselves. It would be unsafe to have this matter decided vicariously for them. It shoxild not be decided for them by bankers or other outsiders. It will be time enough for the bankers and others to give their opinion on any plans proposed when the American Commission has returned from Europe, brought in its findings, and submitted a plan. And now, as the farmers, through the commission of two from each State, are to make this investigation in Europe, it would appear to me that the "jury of inquiry" offers the simplest and most effective mode of doing so, and this stand has met with the approval of the delegates of the International Institute of Agriculture whom I have consulted on the subject. ORGANIZATION OF THE AMERICAN COMMISSION. In previous communications to the Southern Commercial Congress I have already pointed out the need for the American Commission to organize before it reaches Rome, so that on its arrival no time be lost in preliminary work which can be done before or during the voyage. The commission can organize, adopt its by-laws, and appoint its subcommittees while on the steamer en route for Rome. Trie 10 or 12 days of the jom-ney on the ocean can be profitably em- ployed toward this end. Yours, sincerely, David Lubin, Delegate of the United States International Institute of Agriculture, Rome, Italy. COOPEBATIVE SYSTEM OP AGEICULTUBB IN EUROPE. 11 PLANKS IN THE PLATFORMS OF THE DEMOCRATIC, REPUBLICAN, AND PROGRESSIVE PARTIES IN THE LAST PRESIDENTIAL CAMPAIGN. DEMOCRATIC. Of equal importance with the que8tion of currency reform is the question of rural credits or agricultural finance. Therefore, we recommend that an investigation of agricultural credit societies in foreign countries be made, so that it may be ascertained whether a system of rural credits may be devised suitable to conditions in the United States. REPUBLICAN. It is of great importance to the social and economic welfare of this country that its farmers have facilities for borrowing easily and cheaply the money they need to increase the productivity of their land. It is as important that financial machinery be provided to supply the demand of farmers for credit as it is that the banking and currency systems be reformed in the interest of general business. Therefore, we recommend and, urge an authoritative investigation of agricultural credit societies and corporations in other countries. And the passage of State and Federal laws for the establishment and capable supervision of organizations having for their purpose the loaning of funds to farmers. PROGRESSIVE. We pledge our party to foster the development of agricultural credit and cooperation, the teaching of agriculture in schools, agri- cultural college extension, the use of mechanical power on the farm, and to reestablish the country life commission, thus directly pro- moting the welfare of the farmers, and bringing the benefits of better farming, better business, and better living within their reach. JOINT RESOLUTION PASSED BY THE SENATE OF THE UNITED STATES AUGUST 15, 1912. Whereas the Department of State of the United States detailed, upon the application of the Southern Commercial Congress, David Lubin, American delegate to the Inter- national Institute of Agriculture, Rome, Italy, to direct a conference on agricul- tural finance, held under the auspices of the Southern Commercial Congress in Nashville, Tenn., April 1 to 6; and Whereas 27 States were represented through delegates in the conference; and Whereas resolutions were unanimously adopted providing for an American commission to go abroad for the investigation of rural credits in Europe; and Whereas the Southern Commercial Congress will send the commission abroad, com- posed of delegates from all States of the United States, to report to the International Institute of Agriculture (which, under treaty, is supported by the Government of the United States) at the time of the meeting of the general assembly of the Inter- national Institute of Agriculture, May, 1913: Therefore be it Resolved, That the Congress of the United States, in recognition of the valuable service to be rendered the United States in the investigation of the European systems of agricultural finance, hereby indorses the proposed American commission and invokes for it the diplomatic consideration of the countries to be included in the itinerary. 12 cooperative system of ageicultuee in eueope. letter from president taft to senator dxtncan u. fletcher, president op the southern commercial congress. The White House, Washington, February 10, 1913. My Dear Senator Fletcher: It gave me great pleasure to invite the attention and interest of the governors of the several States to the proposed inquiry into agricultural credits. The entire system of agricultural business which is practiced by the farmers of the United States needs to be greatly improved, m view of the failure of our food supply to keep pace with the increase of our population. I trust that eveiy State m the Union will participate in an inquiry which, it is quite certain, will be of real and lasting importance to our rural population. Sincerely yours, Wm. H. Taft. Hon. Duncan U. Fletcher, United States Senate. LETTER FROM PRESIDENT ELECT WILSON. '„ y- State OF New Jersey, Executive Department, January SO, 1913. Hon. Duncan U. Fletcher, Washington, D. C. My Dear Senator : The inclosed letter from Sir. Horace Plunkett will explain itseh. I had a long talk with Sir Horace the other day, and I write now, as he suggests, to tell you that the proposed enlarge- ment of the scope of inquiry by the commission which is to visit Europe has my entire and cordial approval. I think there are few safer guides than Sir Horace Plunkett. Cordially and sincerely, yours, Woodrow Wilson. LETTER FROM FORMER PRESIDENT ROOSEVELT. My Dear Senator Fletcher: Sir Horace Plunkett has told me that the commission to be appointed by the governors of the several States, which originally intended to inquire into agricultural credit ia Europe, now intends to broaden the scope of inquiry so as to embrace the methods employed by progressive agricultural communities in production and marketing as well as in the financing of both these operations. I am very glad of this wise decision, as I confess I did not regard the limited inquiry originally announced as likely to do good to this country, nor the special subject to be inquired into as one which lent itself to the proposed method of investigation. But very great good can be accomplished if the commission thoroughly and impartially investigates the matters to which it is now announced that special attention will be given. I understand that both the President and the President-elect have cordially indorsed the proposal in its present form, and as an Ex-President I am glad to jom in expressing _my own belief in the wisdom of the course you and your associates in this important project have adopted. When I was President I tried to open up this untiUed field of social inquiry by the creation of the Country Life Commission. I am pleased to learn that so valuable a contribution to this work as you COOPEBATIVE SYSTEM OF AGBICULTURE IN ETJKOPE. 13 have projected is about to be made. I shall give it my own zealous support, and, moreover, I feel that it is entitled to the heartiest support of every man awake to what is probably the most vital need of this country. The census reports are sufficient in themselves to show that the yield per acre of our farm lands tends at best to be stationary, and indeed would undoubtedly have gone back if it had not been for the great increase in price of practically all of the staples of life. In spite of a very liberal appreciation of his product, the condition of the farmer has shown no improvement at all commensurate A\'ith the increased cost to the consumer of what he raises. This is thoroughly unsatisfactory. As I gather from the instructions you are issuiag to the commission, you hold that the problem to be effectively treated must be treated in its entirety. I gather also that you believe — and in this I am wholly with you — that the trouble is to be sought and the remedy found chiefly in the matter of business organ- ization. Of course with this must go, an improvement ia fanning methods and an improvement in social conditions in the country districts; but the former is being adequately provided for ia this country and the latter ■will probably be u^Ji >;aken by numerous agencies — the country church, the Y. M. C A., the granges, etc. — which are available for the purpose, when the business of the farmer is placed on a sound economic oasis. I am glad to observe that you indicate that cooperation is the chief subject of inquiry. I am confident this is the real solvent of the business problem. With its adoption ia Europe has grown up the very salutary doctrine which our farmers heed to learn, that they can do more by combiaed and individual action for the improvement of their conditions than the best governments can or ought to do for them. Moreover, Ave must remember that the improvement in the farmers' condition is not their business only; for their welfare is the funda- mental need of the country. Unless the farming communities are on a satisfactory basis it wiU be found in the long run that the conditions of the whole country are on an unsatisfactory basis. The English- speaking peoples not only in America but of Great Britaia and the colonies must wake up to the fact that for over half a century every wise advance in the line of proper development of farming life has taken place not in the English-speaking coimtries as a whole but ia certain progressive States of Continental Europe. It is to these States that we must turn, and to which you AAisely turn, to find out how they have practically met the problems which now confront us and which once confronted them. I hope a very fuU study Avill be made of the Irish rural situation, because in that country most progressive farmers are reorganizing their business upon lines laid do'mi after a study of the continental agricultural systems you are about to examine. Of course our own special n^eds and aptitudes, our customs and ways of thought and of life, a\t11 have to be taken into account in applying the lesson learned from abroad. But the fact remains that these lessons can and must be applied here in this country, and that very great good will come from their application. Faithfully yours, Theodore Roosevelt. aESOLTJTIONS ADOPTED BY NATIONAL ORGANIZATIONS INDORS- ING THE AMERICAN COMMISSION THAT IS BEING ASSEMBLED BY THE SOUTHERN COMMERCIAL CONGRESS. AMERICAN ASSOCIATION OF COMMBBCIAL EXECUTIVES. Whereas the Department of State of the United States detailed, upon the application of the Southern Commerical Congress, David Lubin, American delegate to the Inter- national Institute of Agriculture, Rome, Italy, to direct a conference on agricultural finance, .held under the auspices of the Southern Commercial Congress in Nashville, Tenn,, April 1 to 6; and Whereas 27 States were represented through delegates in the conference; and Whereas resolutions were unanimously adopted providing for an American commission to go abroad for the investigation of rural credits in Europe; and Whereas the Southern Commercial Congress will send the commission abroad, com- posed of delegates from all States of the United States, to report to the International Institute of Agriculture (which, under treaty, is supported by the Government of the United States) at the time of the meeting of the general assembly of the Inter- national Institute of Agriculture, May, 1913: Therefore be it Resolved, That the American Association of Commercial Executives, in recognition of the valuable service to be rendered the United States in the investigation of the European systems of agricultural finance, hereby indorses the proposed American commission. farmers' national congress. Resolved, That the Farmers' National Congress favors an investigation of agricul- tural banking and credit in vogue in Eiu-ope and indorses the movement to send a national investigating cgmraission abroad to study and report upon the rural credit system in effect in continental European countries. NATIONAL GRANGE. Whereas the Department of State of the United States detailed, upon the application of the Southern Commercial Congress, David Lubin, American delegate to the International Institute of Agriculture, Rome, Italy, to direct a conference on agricultural finance held under the auspices of the Southern Commercial Congress in Nashville, Tenn., April 1 to 6; and Whereas resolutions were unanimously adopted providing for an American com- mission to go abroad for the investigation of rural credits m Europe; and Whereas the Southern Commercial Congress will send the commission abroad, com- posed of two delegates from each State of the United States, to report to the Inter- national Institute of Agricultiure, which under treaty is supported by the Govern- ment of the United States, at the time of the meeting of the general assembly of the International Institute of Agricultiu'e, May, 1913: Therefore be it Resolved hy the National Grange in convention assembled at Spokane, Wash., That in recognition of the valuable service to be rendered the United States in the investiga- tion of the European systems of agricultural finance they hereby indorse the proposed American commission. Resolved, That we, the members of the National Grange, in annual session in the city of Spokane, Wash., in this our forty-sixth annual session, do urge that the legis- lature of each State in the United States appropriate ?2,400 to defray the expenses of two delegates who, in company with the delegates from the other States, shall make a study of the various financial systems of the world and evolve a plan that shall meet our financial needs. 14 COOPEEATrVE SYSTEM OP AGRICULTURE IN EUROPE. 15 LETTER FROM CHAMBER OP COMMERCE OF THE UNITED STATES OF AMERICA INDORSING THE AMERICAN COMMISSION. January 30, 1913. Dr. Clarence J. Owens, Managing Director, Southern Commercial Congress, Southern Building, Washington, D. C. Dear Sir: I am instructed by our board of directors to make the following reply- to your esteemed favor of the 8th instant. We recognize the necessity which exists for improving financial methods as applied to agricultural life to the end that the disproportionate drift to the cities may be halted and farm life become more productive and attractive. We recommend the creation of a representative national commission to go abroad in April, 1913, to study the methods of Europe and to consider methods of adaptation to the needs of agricultural America, and will take under advisement your cordial invitation to name a mem.ber of the commission as one of the delegates at large from the United States. Very truly, yours, Elliott H. Goodwin, Secretary. CANADIAN PROVINCE OF SASKATCHEWAN TO BE REPRESENTED ON AMERICAN COMMISSION. Executive Council, Saskatchewan, Regina, November 21, 1912. Senator D. U. Fletcher, President Southern Commercial Congress, Southern Building, Washington, D. C. Dear Sir: I was in Berlin, Germany, in September last, and took occasion in behalf of the farmers of Saskatchewan, amongst whom there has been recently a good deal of discussion on the question of the rates they are obliged to pay for borrowed money, to look into the systems of agricultural cooperative credits prevailing in Prussia with the result that I was put into communication with Mr. David Lubin at Rome, and from Mr. Lubin the suggestion has come to me that we should seek to arrange with the Southern Commercial Congress for representation on the select committee which is to go to Europe in May, 1918, to pursue investigations into the question in several of the countries of Em-ope. I have discussed the matter with my colleagues and am authorized to write and ask you whether it will be possible for us to arrange to send with the select committee one or two delegates to represent the Province of Saskatchewan. If the consent of the Southern Commercial Congress is granted I would ask that you let me have as soon as possible some particulars m connection with the matter of the expense, because it will be necessary for us to ask the necessary financial provision to DC made by our legislature while it is in session and probably not later than 20th December next. If we can have the privilege of representation on the select com- mittee we shall, of course, cheerfully undertake our proportion of the general expenses in the same way as if Saskatchewan were one of the States responsible for the originating of the inquiry. Believe me, my dear sir, very sincerely, yours, Walter Scott, Premier of Saskatchewan. [Telegram.] Regina, Saskatchewan, February 5, 1913. Clarence J. Owens, Southern Commercial Congress, Southern Building, Washington, D. C. Re your letter November 30th last, Saskatchewan Government appointing two delegates, John H. Haslam and Dr. E. H. Oliver. Treasury department will at once forward money to you for reservation. Am writing. Walter Scott. EXTRACTS FROM LETTERS FROM HON. DAVID LTTBIN, AMERICAN DELEGATE TO THE INTERNATIONAL INSTITUTE OF AGRICUL- TURE. The success of this moTement will mean more for the South than is even dreamed of to-day by its most zealous friends; it will not merely mean the economic regeneration of the Southern States, but their pohtical regeneration as well; and, more than that, as this is a matter which concerns the welfare of all the American people, and as the leadership under which this welfare is to be attained was initiated and is guided and directed by a- southern organization, this, if successful, must necessarily secure for the South that exalted and commanding position so ardently desired for her by her well- wishers. ******* And this (referring to the lack of organization on the part of the farmer) is the same sad story of the farmer in all ages and all times. He is the last man to change his dialect, to change- the dogmas of his reUgion, to change his habit of dress, to change his mode of thought; and no wonder, when we consider that the poor devil speaks to barb-wire fences, to pigs, and to clods of earth, whUe his urban neighbor mingles with his fellow man, and as "iron sharpeneth iron" so the urbans become shrewd and aggressively cunning, which enables them to lord it over the dull and sluggish rural mind. But the merciful God sees it all, and, at diverse times and places, lie prompts certain among men to take up this fight and champion the cause of this sluggish- witted man of the soil; and thus we have men like Buring, Kaiffeisen, Schultz-Dehtzsch, Luzzatti, Wollemborg, and Plunket. And the fight is a good one and noble, for it means much more than a fight for some men, for a class; it means a fight for the nation, and, in this instance, for the American Nation, for, be it ever remembered, the farmers of a nation, just because their minds are sluggish, are the conservatives, the conservatives that hold in check the radic,al urbans, whether of organized capital or of organized labor. But in order that this conservative may perform his function it is essential that he be not eaten up as he was in old Rome, and by the very same "robber baron," nowadays called "the trust." If the farmers can be aroused to a sense of their potential power, if that power can be awakened, called into action, it would then be an easy task to brush aside exploiting infiuences. There is no power greater in all the United States than the wiU power of the many. That power is majestic, imperial; but it is only effective in action. It is impotent when inactive. The farmers may complain until they burst, and they will have help or sympathy from no one, but if they rise up, united, and in action, they become invincible. If the farmers want cheap money, or, better yet, dynamic money, if they want to brush aside the exploiting financier and the exploiting trust, they can have what they want and do what they will. Let 16 COOPERATIVE SYSTEM OF AGRICULTURE IN EUROPE. 17 them take this work in hand, let them soUdly petition tlieir legisla- tures to vote for the $1,200 appropriation to defray the expenses of each of their delegates to the select committee, and let this select committee go to Europe and study up the agricultural financial sys- tems in operation there, the European cooperative rural credit sys- tems; and let them think over and digest all that they will thus learn, generalize on its adaptability to American needs, and they wiU be almost certain to overcome the evils under which they now labor, evils which confront them, evils which grow as time, experi- ence, and opportunity permit. And those who aid in bringing about the abolition of these evUs help make this country the greater, the stronger, and the better. And right here it is in order for the American farmer to do some cool and deliberate thinking, so as to place himself in a position for effectual accomplishment. We all know that we must employ the g roper means if we are desirous of producing certain ends. This law olds good in bridge buUding, in bread making, in dishwashing, in anything that we do, and it holds good in the case under consid- eration. If the American farmer desires to benefit by the investigation of the European cooperative credit systems, it then becomes impera- tively necessary for him to be represented on the select committee, not merely by a per cent of its membership, but by a very large per cent, the larger the better. The work should not be done vicari- ously for the Ainerican farmer; it should not be done for him by bankers, nor should it be done for him by professional men, nor by men of leisure, nor by men of other occupations; it should, primarily, be done by the American farmer himself. It may be said that the farmer's mind is of too simple a cahber for the proper understanding of the great question before us, requiring, as it does, financial, industrial, commercial, and economic experience of the widest range and the highest order. Assuming this to be true, it nevertheless follows that the best composition of the com- mittee for the end in view will be in the main the farmers; for, let it once be understood that an authoritative delegation consisting mainly of American farmers, officially accredited by the States and by the Nation, consisting of two from each State of the Union, is to visit the European countries for the proposed purpose, and this will at once arrest the attention of eminent and capable thinkers in all the world and bring forth their comment. It is these comments, when blended with the experience acquired by the American farmers on this committee, which will indicate the most practicable method of adapting the European systems to meet the needs of agriculture in the LTnited States. The American farmer should, therefore, busy himself in the work of obtaining the funds necessary for his State delegation. EXTRACTS FROM THE ADDRESS OF HON. EMMET O'NEAL, GOV- ERNOR OF ALABAMA, AT THE GOVERNORS' CONFERENCE, HELD IN RICHMOND, VA., DECEMBER 6, 1912. [Got. O'Neal is chairman of the committee on rural credits of the House of Governors.] The Southern Commercial Congress has already undertaken, with most commendable zeal, to send a commission to Europe composed of two delegates from each State to make a careful examination and study of the systems now prevailing in Europe and to report their conclusions to some subsequent meeting of the association, after which suitable legislation can be proposed and adopted. The Senate of the United States has already adopted a joint resolution indorsing the action of the Southern Commercial Congress. In my judgment there should be immediate action taken to establish some wiser and better system of loans on farm lands, a system by which these loans could be made readily negotiable, and at low rates of interest, and by which by using amortization the borrowing farmer can repay his loan in small annual payments by the time the loan matures. In the South, especially, there is urgent need of some system by which land credits can be quickly mobihzed, by which mortgage security can be made readUy marketable, negotiable, and available. After a mortgage loan is made the lender should be provided with some method by which he can rediscount his mortgage security like any other negotiable paper. By a system of land mortgage bonds easily negotiable that large mass of our people who have smallsums to invest could find an absolutely safe investment, which they could also use as collateral or readUy sell in the open market. These same persons are generally the principal victims of unscrupulous promoters who exploit millions of dollars worth of fictitious stock and bonds the chief value of which oftentimes consists only in the handsomely engraved certificates on which they are printed. The estabhshment of banks of the K.aiffeisen, Shulze-Delitzsch type in Germany and the Luzatti system in Italy must depend upon the action of each State. I believe that every one who makes a study of these cooperative systems can but reach the conclusion that they can be successfully operated in this country by being so modified or altered as to meet conditions in America. We must remember, however, that before we can establish similar systems of banks for the extension of rural credit in this country a propaganda of education and study must be undertaken. A central office might be established to gather together aU possible information and lay down fundamental principles, to arouse public interest, to present the results of study of foreign practices, and to formulate proposed legislation. From the central office branches could be easily established in every State to commence a campaign of education, to present the fundamental principles and necessities which make the establishment of these systems of rural credit so imperative, and to arouse public interest in this important movement. The Southern Commercial Congress has already patriotically undertaken this task and proposes to make an exhaustive study of tliis entire subject, and the results of then- investigation win no doubt be extremely valuable. 18 EXTRACT FROM THE ADDRESS OF PRESIDENT TAFT AT THE BANQXTET GIVEN IN HONOR OP SIR HORACE CTJRZON PLXJNKETT, TENDERED BY THE SOUTHERN COMMERCIAL CONGRESS, AT THE SHOREHAM HOTEL, WASHINGTON, D. C, JANUARY 27, 1913. Mr. President, Sir Horace, gentlemen of the Commercial Con- gress, and fellow guests — for I see some here who do not belong to that Congress: It is a great pleasure for me to come here to testify by my coming my profound respect for your guest of honor. There is not anything that the Southern Commercial Congress has done that shows the sin- cerity of its purpose more than this honor to Sir Horace Plunkett. He has been engaged in a country in which the accumulations of mis- taken legislation had produced such a condition that it needed almost the surgeon's knife to bring about a betterment; but the history of the land legislation of Ireland is one that now with its successful result we ought to study for the purpose of enabling us to see whether we can not take something from that experience to help us on. It is true they have no constitution in England or in Ireland that is written, and ParUament is absolute, and there were a good many things done with respect to land in Ireland that we could not do here under our Constitution and that would not have been justified, except for the evils that had grown out of Parliamentary legislation and of a misstatement — or a misunderstanding certainly — of the necessities of Ireland. Now, Sir Horace Plunkett has worked in that field, and he has made a great success ; and it is certain that the Southern Com- mercial Congress is looking to the improvement of the South and the improvement of agricultural methods, and the improvement of those methods with relation to the improvement of the people engaged in agriculture has done something that can be of great assistance to them. Now I came here to say that and that only. The subject of credits and the necessity for improving the method of the securing of better credit to the farmers is one that I have dis- cussed, taking much of it on credit, because I haven't had the per- sonal experience that justifies me in speaking with any authority. Tiie results that we have seen in Germany and in France and in other countries — doubtless in Ireland — make me think that we would be without our usual willingness to adapt everything good that we see unless we take up this subject, study it, as you propose to study it, through your commission, and then adapt it through the States in so far as it may be adapted to our civilization and our people. We used to think that we could not learn anything about agriculture from the other side, that we were so rich and that our crops were so big that really to look over to England where they had to cultivate down to the last foot was to do something that indicated a retrogression rather than a progression, but now we are reaching a point where we can calculate that unless we do something in the way of improving our methods of agriculture we shall be at a point where we shall have to import what we eat, and we shall become dependent on other coun- tries rather than to feel the independence which has swelled our heads to a point — sometimes I think to a point of danger. We have a great deal to learn, and I doubt not that from such authority as Sir Horace Plunkett we can learn a great deal. 19 COMMISSION'S PURPOSE AND SCOPE. Referring to tlie purpose and scope of the proposed commission, intro- ducing Sir Horace Plunkett, at a dinner in his honor in Washington, Janu- ary 27, 1913, Senator Duncan V. Fletcher, president of the Southern Comnaercial Congress, said: In 1892 — over 20 years ago — Edward T^ Peters, under the direc- tion of J. R. Dodge, statistician, prepared a report on cooperative credit associations in certain European countries and their relation to agricultural interests for Hon. J. M, Rusk, Secretary of Agriculture, who published it. In this report there is discussed quite clearly, though concisely, the German credit unions or people's banks, the Raiflfeisen loan associations, German legislation on cooperative associations, people's banlcs of Austria-Hungary, cooperative banking in Italy, and coopera- tive banks in Russia. In transmitting the report it is stated "these people's banlcs have a success that justifies their existence, as they fill a virtual vacuum in banking opportunities for the agricultural and industrial classes." It is stated they "in a large number of cases have been of great benefit to agriculturists" and that "cooperation has assumed an altogether new importance as the result of circumstances especially characteristic of the industrial era in which we live." Since 1892 much has been said and more written on this subject. Theses, magazine articles, and books have been published, using the systems established in European countries a half century ago as the theme. Documents have been printed in great quantities. That such systems possessed undoubted merit has been recognized; indeed, the long-continued success these institutions have enjoyed should be ample evidence of their beneficial and sound character. Yet no permanent impression was made on American minds. The great body of our people engaged in agricultural pursuits caught only an occasional and then but a faint gleam of light. Perhaps others who better understood what was being put forth did not care to give it circulation or have it considered ; at any rate, no serious, effective steps were taken to give any of these systems a fixed foothold here. No agency took up the matter in any businesslike way and pushed a movement forward which was calculated to put in operation in this country some one of these financial or cooperative plans, devisfld primarily for the benefit of the producer and to advantage conditions of country life, in such form as would be suited to our circumstances. The International Institute of Agriculture, tlarough the American delegate, Mr. David Lubin, has been bombarding us for years with printed material on the subject, stressing its importance and urging action. What was needed was an organized force behind the movement which would enlighten the people on the subject, and give it such direction as would surely accomplish definite results. Such an agency has at last been found. 20 COOPEEATIVE SYSTEM OF AGRICULTURE IN EUROPE. 21 Last April, by order of the State Department, Mr. Lubin came from Rome, the headquarters of the institute, to attend the annual meeting of the Southern Commercial Congress in Nashville. His purpose was to arouse our people to positive action. He insisted that we should assemble representatives from the different States for a six days' con- ference in Nashville, just preceding the convention. We did that, and delegates from 27 States, for six days, under the guidance of ]\ir. Lubin, with the publications of the International Institute of Agri- culture and other documents as textbooks, reviewed the whole subject of cooperative rural credit and its branches, with the result that a resolution was adopted calling on the Southern Commercial Congress to raise a commission to be composed of two selected men from each State, to go to Europe, visit the various countries where these financial systems are in operation, and study them and the laws governing them at first hand; where cooperative societies among farmers an