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Duffus, William M. / Report on agricultural settlement and farm ownership. Part I: state loans to farmers
(1912)

Chapter VII. Farm tenancy in Wisconsin and the need of a system of long-time loans for the tenant farmer,   pp. 130-143 PDF (3.8 MB)


Page 141


141
STATE LoAsNS TO FARMERS.
  There remains for consideration the fourth method of at-
acking the problem of farm tenancy. Various plans for giving
the tenant farmer or the landless farm-worker the assistance of
the state in purchasing land have been developed in the differ-
-ent countries in which the state has seriously attempted to re-
duee or prevent the growth of farm tenancy. The essential
principle of most of these plans, however, is a simple one. The
atate, having decided that farm tenancy is an evil which should
be eliminated or reduced to a minimum, takes the most obvious
step to secure these results. It helps the tenant to become a
landowner. This the state does either by lending the tenant part
of the money needed to buy his farm or by itself buying farm
land and reselling it to the tenant farmer on easy terms.
   When the state lends money to a tenant farmer to be used
 in buying a farm, it usually requires ample real estate security'
 behind a first mortgage. In such cases, the state really acts as
 a mortgage bank by gathering funds through the sale of bonds
 to the public and loaning these funds to individual borrowers
 as their applications are approved. In some cases, however, as
 in the case of Ireland, the social necessity for the abolition of
 farm tenancy is so strong as to justify the state in advancing a
 greater amount of money than that for which the borrower can
 offer a good banking security or, indeed, than that which the
 borrower is expected to repay to the state. In America, however,
 conditions are not yet serious enough to justify the loan of. money
 -to farmers by the state or federal governments on any except a
 sound business basis, in accordance with which every dollar
 loaned and every cent of the cost of operating the system of loans
 -should be repaid to the loaning authority by the borrowers.
     The development by the state of a system of long-time farm
   mortgage loans to be made at low rates of interest to enable
   tenant farmers to become farm owners seems to be the only ade-
   quate method of attacking the problem of farm tenancy which
   is capable of immediate adaptation to conditions in Wisconsin.
   -The proposal that the state inaugurate a system of farm loans
   is not a new one in Wisconsin-it has been made time and time
   again by editors of agricultural papers, by public men, and
   others interested in the progress of agriculture in the state-nor
   is it a proposal without ample justification from the experience
   .of foreign nations and American states which lend money on
   farm mortgages.


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