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cial paper or agricultural paper. If they had this warehouse receipt plan there would be no trouble at all. The mortgage loans, however, are too long and not liquid enough for the local bankers to use, and this joint stock of the farm loan banks takes care of that.

I just want to say that there is a plan like this at the Government experimental creamery at Grove City, and if any of you come there I will be glad to take care of you. It is in Mercer County between Pittsburgh and Erie.

Chairman MINER. We have had some pretty interesting papers at this congress, and we are going to have some more, but I regard the cne you have just heard as one that contains a good deal of meat. It affects some of you gentlemen from various angles. There are some big producers here and I see also some very large handlers in one of the largest cities in the country, if not in the world. I don't know how it appeals to them, but from the quality of the people I see here I think you gentlemen ought to discuss this in a very able fashion. It is open to you. How about our friends from the West? I see some of the largest western dealers are here.

Dr. C. L. ROADHOUSE (of California). In 1917 I visited Grove City for a few days and had the pleasure of meeting the author of this paper and attending a meeting of dairymen that were met to consider the purchase of another carload of purebred animals. The extension worker from the Dairy Division of the United States Department of Agriculture was present and the local banker whom you have listened to in reading this paper. And during the course of the afternoon arrangements were made for the extension worker with such dairymen as desired to make a trip with him for the purchase of cattle, and orders from others who could not make the trip, meant the beginning, I think, of the work which has been explained by the speaker.

I was impressed with the building up, the rapid building up of this community, which, I believe until the Federal creamery was located at Grove City, was not recognized in the community. I have used this community as an illustration in farmers' meetings and dairymen's meetings since that visit to Grove City, and I believe it illustrates what can be done when dairy farmers and local business men and dairy extension workers come together to work out a community problem together.

As I recall it the various extension programs such as the purebred bull campaign, the silo campaigns, and such similar various extension activities were applied to the Grove City dairy community, and it appealed to me as being a real development along those lines.

Mr. HARSHAW. You will be interested to know that it was the first county of Pennsylvania free from tuberculosis.

Chairman MINER. There are several angles to this discussion still. gentlemen.

Mr. E. W. LANGFORD (of England). I am pleased that we were given an opportunity of listening to this paper. I think it has been one of the most important since the congress began, and I take it the gentleman who read the paper was addressing these remarks in the paper to farming in general rather than to the dairying industry in particular.

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Mr. HARSHAW. Yes; although that applies to the dairy industry

Mr. LANGFORD. It is rather more that phase of it that I would like to briefly touch upon this afternoon.

One is glad, of course, that the bankers are taking a keener and a wider and, if I may say, a more intelligent interest in the financing of the farmers. In my little country, England, we think there has been too little attention paid to the financing of the farmers. In fact, the cities and towns have not paid sufficient attention to the purchasing power of the farmers and the influence of a declining agriculture upon their sales.

What I want to touch upon this afternoon is this: I know that there are a vast number of farmers who are inadequately financed. Therefore it would be a great deal of assistance to them to be able to get accommodation from the banks. But there are those, I suppose, in this great and important country, as well as in every other country, and there are a few in my own little country, who have sufficient capital to adequately finance their business. Perhaps as the breeding ground of the world I may say we have purebred stock. We have learned the advantages of using only purebred suitable bulls, whether it be for dairying, or for beef production on the other hand. But at the present time we can not produce crops, whether it be cereal crops, on the one hand, or beef, on the other, at a profit; and I don't want to throw cold water upon the very excel

paper and remarks that were made this afternoon. But there is another side to the question of trying to lift the industry and put it upon a profitable basis.

Some two years ago we had in our country a tremendous amount of surplus beef, no end of graziers and cattle. Many of the farmers borrowed money at the bank and had ample security to give to the bank and expected when they sold those cattle that they would be able to discharge their liability to the bank and have some profit held over. But, unfortunately, that was not the case, and many of them became financially embarrassed because. having sold their stock after the stock had consumed their crops, and after giving to the bank all they made from the stock, they were still owing to the bank a vast sum of money.

What I do want this important, although small meeting, to appreciate is this—that something has got to be done to lift the industry so that when you grow your wheat, when you produce your mutton, when you have reared and fatted your cattle, it is only a question of whether you can set it in the world's economic market at the price of cost of production plus profit. And that is, I think, one of the problems we are up against.

I was pleased to hear the opening remarks of the gentleman who read the paper and the quotation of that fine old statesman, Abraham Lincoln. We in our country think an immense amount of him. And if I understood the quotation right, it was Abraham Lincoln who foresaw the time when a farmer by scientific assistance and his own energy would be able to make two blades of grass grow where one grew before.

In our country we have endeavored to do that, but we have come to the point now as to whether it will not in the future be more

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profitable to the individual farmer rather than grow two blades of grass where one grew before, rather than grow 5 quarts of wheat where 4 grew before, whether it wouldn't pay him to attempt to grow per man power rather than per acreage. Whether it will not pay the man better to apply the law of diminishing returns to the land, and when he has achieved and got a smaller crop, whether there will not be more profit left to him out of the smaller crop because he has expended less upon his land, less in labor, less in manures. less in actual tillage of the soil. He might, in self-preservation, be forced to adopt that method, as I said before, of the law of diminishing returns rather than grow maximum crops at a cost which will leave nothing to himself. That is from the standpoint of the farmer.

When we come to the standpoint of the community, it is a very different thing which obtains, and it is for the community to say whether they are going to allow the farming industry to decline in this and other countries, and it does become an extraordinarily difficult problem to know what to do to assist the industry at the present time. It would appear that all over the world foodstuffs are being produced in greater quantities than the economic demands for those goods.

I appreciate, probably as you do, that at the present time the world is probably consuming at as low a point the foodstuffs that we produce as it has for a very long time. It may happen that if industry improves all over the world, and if labor is absorbed into industry. wages may improve to a great extent, and it may happen in a very short time there will be better demand for foodstuffs. And if you apply the law of supply and demand, it may easily happen that the prices may go up in order to make these branches of farming profitable.

But so far as to-day is concerned, and in order to tide over the very difficult circumstances, the farmer is really up against a very serious problem, and we cordially, I take it all over the worki. thank and are grateful to the financiers of the world in applying some thought and we hope some keen interest in assisting us over what I hope is only a temporary period. [Applause.]

MEMBER FROM PENNSYLVANIA. I am from the same State as the speaker, only the other end of it.

When I was a boy the first time I ever heard Roosevelt talk he said the best sort of a way to build up a nation was to help each man to help himself, and somehow or other that always stuck to me, and the older I grow the more important it is.

We look upon the work that the Grove City National Bank is doing--that means the community—as close to the acme of perfection in the dairy line as most of us know of. We in the neighborhood always tell anybody buving milk about Grove City. We have paid the expenses of some farmers to go there from the rural communities to get the education. We have a difficult task to get them interested enough to go. But there isn't any question if you get them interested they will go. I have often told the bankers that the farmer doesn't understand them. If a farmer knows he has to go to the bank to borrow $500 he won't enjoy his breakfast that morning You have got to get him to get the vision first and he can play the banker game as well as the banker can play the farmer game, anil

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it makes him a different man. It has helped lots of our farmers and bankers to get mixed up, and it has been quite instructive in developing the dairy business where we are interested. And it has been a big help to us in that indirect way.

Mr. HARSHAW, Our bank, when we started this selen years ago, had resources of $763,000. The old bank had resources of $1,200,000. At the last call our deposits were $1,800,000 and their deposits were $800,000, showing we had gained so much more. And that should be $ convincing enough to any banker. That ought to convince any banker that this does pay in a dollar-and-cents way.

You spoke about increasing the production. In our country the farmers are paying so much more for things that if we had not gone ahead as we have and raised so much more per man and gotten on a so much better production basis, I don't known what we would have done to-day. I think that still continues here.

Chairman MINER. I think, at the risk of violating one of the ordinarily accepted conditions as the chair, I would like to speak for a minute as a member of this conference, and I reply now to the gentleman from England, who, as you all know, is Mr. Langford, the chairman of the produce and dairy committee of the National British Farmers' Union, which represents something around 125,000 to 130,000 men. So he speaks from a very deep conviction and experience.

I don't know anything about the details of dairying or the details of agriculture, although I regret to say I have a ranch down in Texas and some corn land in Illinois which isn't producing as much as I would like to have it. But the fact remains as a manufacturer I must look at this thing from a little different angle. Thinking of it the other day, I was driving through Illinois in a motor, and I drove past a piece of land 60 acres in extent, which I can remember for 30 to 35 years as a boy because it was owned by a Very wealthy man for a farmer in those days. He had three threehorse plows break up that stubble on that land. I drove by there the other day. One man with a Ford tractor was taking care of those 60 acres. In other words, the land which formerly had been devoted to the raising of the food for nine horses and two men, was now, of course, being turned into productivity. It was the use of the machinery on that farm.

My grandfather was one of the pioneers in the West. The deeds of the land were signed by the old Patent Office under Andrew Jack

Some time ago I had one of my auditors sit down and figure the amount of time that it took him in the fifties to produce a bushel of wheat and the amount of time that it takes now to produce a bushel of wheat. When he was in his hevdev and land was high and wheat was good, the land was richer than now, it took about 2 hours and 30 minutes of human labor to produce a bushel of wheat. Now it takes about 10 minutes to produce a bushel of wheat.

Just look at it in another way-from another angle. Last year between 1,500,000 and 2,000,000 men left the farms and went into industry in the cities. Yet with that shortage of men we are producing now more than 200,000,000 bushels of wheat upon the same land that we had in tillage in 1913. You see, we have substituted for the human element the machine, and I don't think we have quite

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taken that factor into consideration in our discussion of the immediate troubles.

I regard this as one of these curves that you sometimes see plotted in the history of the commerce of the country. I think pretty soon we are going to take a lot of more men out of agriculture, put them into industry without any detriment whatever to agriculture. That sounds very heretical, but I think perhaps you will find the panacea of your trouble will be there.

i beg your pardon for trespassing upon your time. [Applause.] Mr. M. D. LINCOLN (of Ohio). I have wanted to meet this man for a long time because I had the good fortune back in 1915, I believe. to be the first banking man to give his full time to developing agriculture. In Brockton, Mass., a little city bank there started the very work that Mr. Harshaw has carried on so well and finished up better than we did. And from that town I came to Cleveland, under the direction of Myron D. Herrick, who was one of the pioneers in feeling that there was a real place for the banker to take a more active interest in the economics of agriculture.

I think in all of our early work as agents for banking institutions we did what the gentleman said here--we directed our activities entirely to the question of production, and it is only recently that we find the Bankers' Association and I know the Ohio Bankers' Association has just gone on record first favoring a cooperative marketing, and then stating that they felt it was high time that the farmers as business men and the bankers as their financiers made a very intelligent study of two things: Economical production as well as economical distribution.

I helieve we as farmers-I have always been connected with farming in one way or another-have made the same mistake. We have just blindly produced. A manufacturer would think it folly to continue to pile up his warehouses if there was no consumptive demand. That is what I believe Mr. Waid was asking here when he asked if in this statistical work we were going to give an equal amount of time to studying consumptive demand and methods of increasing consumption as we do in increasing production.

I think to-day the farmer needs rather than more capital, perhaps, information and help on the more intelligent use of capital. We have always been concerned with the large number of inefficient producing dairy cows. I wish there were some way whereby the bankers, or somebody else, could just make the farmer get rid of those boarders. I believe if we milk fewer cows and feed those we have better and keep the most efficient producers, our problem of low returns to the dairyman would be in a large way done away with. And I believe now, with the development of cooperative marketing, or even without that, there is another problem that the country bankers and the farmers can well afford to look into, and that is some way-it may not be practical, but it seems to me it is—of keeping this tremendous surplus that is the bugaboo to all of us from going to the cities, paying transportation on so much water and then having to manufacture just the surplus products and dumping the by-products down the sewer.

Those by-products are things we need back in the country, and it seems to me if somehow we can arrange to first only send to the

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