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then sent back to England to lecture to recruits ing schemes. He was one of the delegation on some of the peculiar phases of modern to the Legion that was sifting the drifted warfare, and to explain to them the use of sands of ancient Alaskan beaches for the the gas mask. Later he returned to Canada yellow dust that is the basis of our currency, to take command of the 213th, leaving a son when the fighting fever got him again. in the trenches in Flanders, who will join his In the eyes of his companions Tracy father's command when it reaches the front. Richardson has been uncannily lucky. For Before he enlisted Mr. McCormick was In- Richards on has been bit by fourteen bullets dustrial Commissioner of the town of W'cl- between Mexico and Flanders, and rejoices land, Ontario, and during his incumbency of in the nickname of the “Human Sieve." that office he boosted the pay-roll of the The doctors sent him home from Europe and city's industries from about $50,000 to got him a pension under the belief that he $2,000,000. Tall and alert, he looks every would be a cripple for life, but he is returninch a soldier, and he is one, with sixteen years' ing to the firing-line without the pension but service in the Michigan National Guard behind with the full use of his limbs and shooting him. His motto, “Never let a fault go un- eye. He is a kindred spirit to the English checked," explains his rapid rise in the army. admirals who, Stevenson tells us, “ courted

When Colonel McCormick left Welland, he war like a mistress." took with him Mr. H. L. Hatt, now Captain On the flat greensward of the trainingHatt, of his staff. Mr. Hatt was President grounds I saw Americans drilling shoulder to of the Board of Trade of Welland and a shoulder with Canadians. Then I watched them member of the City Council. He began his in the lecture hall elbowing the same Canadians services to the Allies by helping to recruit the and all drinking in the wisdom emitted by Ninety-eighth Battalion in the quick time of Colonel Lang, director of the school for offitwo months at Welland. Then he entered cers, a typical British colonel, round, ruddy, the Forty-fourth Canadian Militia, and later and risible, hard, hale, and human. His adjoined the Legion. As I have said before, vice was that the two prime desiderata in an most of the men in the Legion are there at officer are "guts”-i. e., character and great financial loss to themselves—in fact, "cleanliness," the latter emphasized by a sweep most of them in civil life could earn at least of the colonel's hand over his round face to three times as much as they earn in khaki. indicate the clean-shaven condition below the But Captain Hatt's sacrifice was much greater upper lip, which is the sine qua non of a than that. When he stepped out to serve the British soldier. Beards may do for the King, he left a prosperous business in the French and Russians, but a beard on manufacture of metal bedsteads at Welland. Briton to a British soldier means mental and

Nutshell biographies of other men in the moral flabbiness. Legion are interesting.

All the American officers that I saw in the Lieutenant R. E. Smith sprang from Eng. training school were mature men. One of lish parents and has served in the Royal them, W. H. S. Taylor, of Port Huron, Engineers, but his name is still remembered Michigan, a veteran of the Spanish War who in western New York as the champion saw the surrender of Santiago, was grizzled amateur aviator of that section, the man who till he looked perilously near the upper age built and flew the first aeroplane ever seen limit. But the recruiting officers will strain in Rochester, New York, when he was living a point for an applicant who carries himself in that city.

with the unmistakable “set” of the knight Two of the most picturesque characters in of many battles. the entire Legion are Captain Alexander Like the officers of the Legion were the Rasmussen and Lieutenant Tracy Richard

Those of the 213th were quartered son. Rasmussen, offspring of a Danish in a similar and adjacent building to Stable father and a French mother, won his spurs 24. Dropping in here after mess one evefighting for the United States in Cuba in ning, I found veterans of every campaign of 1898. Afterwards he went to the Philippines importance during the last quarter of a cenwith the Fourth Cavalry, and still later the tury reminiscing over old fights and specuroulette wheel of fate threw him into Mexico, lating on future bloodletting. My host was where he took out a commission as a ciptain private John P. Heywood, of Indianapolis, under Alvaro Obregon, the Carranzista, and Indiana, a Rough Rider in 1898, later for fought the Yaquis who had wrecked his min- two years in the Illinois Naval Militia, now



looking for a joust with the Kaiser. His of initiative. Most of them have borne “ pardner " was a man with a squint caused arms before, some in foreign wars, some by the back-fire of one of Castro's cannon in in our militia, some in our regular army, Venezuela. In the tiered bunks beneath the from which a few have deserted for the whitewashed ceiling were men who had fought greater glamour of life in Europe. The in all the principal Latin-American revolutions cook of the officers' mess of the 213th within the memory of the present generation- has an honorable discharge, granted after men who were scarred in South Africa, in the seventeen years in the American army. Boxer Rebellion, in the Philippines, in the Because so many of them are already trained, Bəlkans, in Turkey, in traders' wars in the the Americans are more easily whipped into Yukon, and in racial bickerings on the Bar- shape than the other elements in the Canabary coast. No striplings were they, but dian overseas force. That is why the Amerseasoned fighters all; strong-limbed, thick- icans are popular with clever Sir Sam chested fellows like the men-at-arms they Hughes—well dubbed “the Kitchener of would have been had they lived in the days Canada " by Captain E. B. Hesser, of the of mail and broadsword.

213th. At Niagara-on-the-Lake, where the They had come from all parts of the United battalions go to gain polish in drilling, bayStates—in fact, from all parts of the world— oneting, and bomb-throwing, the Americans paying their own expenses to be in at Arma- have proved themselves in most cases already geddon. The following residence statistics well trained in the art of war. Colonel of the first eight hundred and seventy-five McCormick told me that within three months men to enlist in the 97th Battalion are typical after the 213th has been recruited to full of the whole Legion :

strength he can have his men ready for the New York.. 187 Colorado .... 8 trenches. Michigan.. 140 Tennessee.

6 They are not boys, these Legionaries, neither Illinois 60 Kentucky.


are they in the mass hot-headed adventurers. Massachusetts. 58 Maryland.

6 Pennsylvania 51 Idaho.


There are a few soldiers of fortune, but Ohio.. 50 Maine.

5 most of them are sober, hard-working, everyMinnesota 29 Louisiana

5 day citizens who have left their families and Washington 27 Kansas.


livelihoods for deeper reasons than the mere Wisconsin. 20 Florida

4 Missouri.. 19 New Jersey.

fun of soldiering. Whether you are proIndiana.

19 New Hampshire.. 3 Ally or pro-German, you must face that fact. California 13 Oklahoma ...

2 And they are changing the attitude of Canada Iowa .... 15 Dist. of Columbia. 2

toward Americans. Alabama.. 14 Arizona ...

2 Montana... 12 Mississippi


As I was watching the candidates for comRhode Island. 11 North Carolina.... 2 missions drilling on the grassy stretches of the Oregon

11 South Dakota...... 2 Toronto training-grounds a native boy of Nebraska 11 Georgia


twelve, who was playing with a Ross rifle, North Dakota. 10 Wyoming

2 Connecticut. 10



asked me, with a glance of contempt at my Virginia... 9 Arkansas.


civilian clothes : Texas ..

9 West Virginia.... 1 " Why aren't you in the army ?" Vermont 8

“Oh," said I, “ I'm an American." Instead of the green and raw-boned youth “ That's no excuse,” the boy continued. that I had expected to find in the Legion I “ Americans are fighting, too, thousands of found mature and red-corpuscled manhood. them. We used to think they were afraid, but The Legionaries are thinkers every one, men they're just as brave as we are, after all.”


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Sa pert paragrapher has remarked, borrower must subscribe to the stock of the

the Federal Rural Credit Bill will local association in proportion to his loans.

get nothing for the man who has got The bills provide for both limited and unlimnothing for himself. It is not a wizard's iled common liability forms of organization of trick of pulling a fat goose out of an empty the local association, so that the borrowers of hat; it is not a miracle-working plan of each group may elect whether they will use making wealth out of poverty ; it is not a good one or the other. fairy to give a farm for the wishing. Nor is Thus, in due course of development, if the it, as a smug New York editor has declared, system succeeds, the Government's stock in

a crazy Socialistic experiment;" nor is it, as the banks will be replaced by the stock of the the New York Chamber of Commerce implies, local borrowing associations, as the stock in an exceptional or unwarrantable or dangerous the Federal Reserve banks is owned by the employment of governmental power for the member banks. The bills provide also for benefit of a class. As in most cases of joint stock land banks without membership excited contention, the truth lies midway in the district banks, and for lending directly between these extremes.

to individuals where there are no local associI speak particularly of the pending Federal ations; but these and other details of accomlegislation because that is now a matter in modation, adaptation, and safety need not be the public mind, and because it is, in pros- discussed in this brief review of the broad pect, a somewhat epochal effort of the Na- problem which Congress is endeavoring to tional Government to stabilize—and by stabil- solve, and of the policy it is pursuing in the izing to cheapen-land credit in the United employment of Governmental powers. I am States. At the time of this writing the Senate careful to add in this connection that it would has passed one bill and the House another. be almost a miracle of legislative wisdom if They differ in detail, but they are substan- the law which is presently to emerge from the tially the same in principle and in policy. They two houses of Congress should be perfect in are variations and revisions of the original every detail. It is a new subject; it is an Hollis-Bulkeley Bill of the last session. They experiment; but it is a composite of the conprovide for the appointment of a farm loan clusions of the ablest economists and of intelboard of three to five members to establish ligent statesmen who have labored industriand supervise twelve district farm loan banks ously for about three years. I would have with a capital of $500,000 to $750,000 each, written a different bill; so perhaps would with power to issue farm mortgage bonds or every man who has studied the subject; but debentures in twenty times the amount of the this is the best that can be obtained ; it is a capital stock, and for the organization of start in the right direction, and a year or two local borrowing associations to be members of experience will exhibit its defects for of the district bank, somewhat after the form amendment. This has been the way of interof the organization and relation of the Fed- State commerce regulation, and of all imporeral Reserve banking system. The capital tant measures of economic reform. of the district banks is to be offered to the As to its paternalism, I challenge a compublic, and the Government is to subscribe parison with the Federal Reserve banking such part of the capital as the public does not system, which puts the Government's credit subscribe-precisely as provided for the capi- behind commercial paper and makes the talization of the twelve Federal Reserve banks. Government a partner with the Reserve Assuming that the public will subscribe none bank in the profits of the institution. As to of the capital, the Government will invest the powers of the farm loan board, they are twelve times $500,000 or $750,000, but this not larger than the powers of the Federal investment will be made only for the time Reserve Board, and we may fairly assume being, for the bills provide that the local that the farm loan board will be as discreet borrowing associations must subscribe to the as the Federal Reserve Board. As to the stock of the district bank in proportion to its invoking of Government stimulation and loans from the bank, and that the individual regulation of land credit, I submit that the same service has been rendered for commer- efficient farming--are American conditions cial credit. I have great respect for bank- and habits which heretofore have made ers, but it will be acknowledged that the speculative adventures and industrial enterbankers of the United States made such a prises so enticing to investors and creditors. sorry mess of commercial finance, with recur- Railroading, mining, town-building, and high ring panics and wildly. fluctuating rates, that finance of one sort or another have absorbed they were persuaded reluctantly to accept the the most of our available capital. Upon top Federal Reserve device of a college profes- of that the failure of a lot of wildcat land sor, and now they boast it as if it were their debenture companies in the late eighties gave own invention. The banker is a slave of a bad name to land loans. Money-lenders are habit and custom ; to him what is is right just about as human as other folk. Like sheep, and change is dangerous. It is well that he they followed their bell-wethers to the parched is so constituted, for if he were adventurous prairies of unproved productive value, and, like he would not be a safe conservator of credit. sheep, they follow their bell-wethers in runLet us weigh his counsel in order that we ning away from the present rich pastures of may wisely make haste slowly, but let us not proved productive value. Land loans are wait too long upon his hesitant initiative. not in the fashion, and your custodian of trust

In this mood let us see what is the need funds is a man of scrupulous conventionality, for rural credit legislation.

This premise must be accepted by every Consider first the bald fact that dependable thinking man as true: Farming land is the farmers in the West and South are paying source of all food and raiment; it is the 9.6 to 15.6 per cent, and distressed farmers prime means of all human sustenance. By 20 to 40 per cent for short-time operating all the rules of economic philosophy it should credit, and land borrowers are paying 8 to be the safest basis of credit. Readers of 10.5 per cent for five-year loans with burden- rural credit literature have been told repeatsome commissions for renewals. No indus- edly that before the European war land loans . try can pay such rates and prosper. Farm- in Germany commanded a lower rate of in

ers are not prospering except in rare cases terest than Imperial Government bonds. The of genius, or under methods of niggard self- most eminent of the German rural econodenial. The profits on agricultural lands in mists three years ago gave me a reason, in the last few years have consisted mainly of words to this effect: Governments someenhanced values due to increasing population times fail; they may be compelled to repuand corresponding demands for farms. diate their debts. Land on the average of

The cause for high-priced agricultural the years, under intelligent cultivation, will credit is twofold. First, and probably fore- not fail, because nature never repudiates or most, is inefficient and uneconomic farming. wholly defaults.” How much more prophetic But at the worst that is not altogether the he was than he then realized! It is certain farmer's fault. As a people, we have that the European governments at the close neglected the business of farming; in our of the war must repudiate in some degree, thinking we have put it to one side as a mat- at least to the extent of a compulsory reducter rather distinctively, if not exclusively, tion of the interest charges they are now payo" within the jurisdiction of Providence. The ing. Department of Agriculture and the land- Mr. Jacob Schiff says : “We bankers know grant colleges have done much-incalculably that debentures based on farm mortgages muck. --for the science of agriculture, for in- cannot be as readily sold as bonds of induscreasing the yield of the land and combating trial concerns or bonds of railroads." That plant and animal diseases, but little until very is true at present, but it is a fact due to cirrecently for the business of farming. To cumstances, conditions, and habits, and not increase the yield may or may not be to in- to economic truth, as the German econocrease the profit, for even in normal times a mist's philosophy plainly proves. The purbig crop usually sells for less gross money pose of rural credit legislation is to institute a than a small crop, so that the more the farm- reform which will square credit practice with ers produce the less they receive. Without economic truth. This brings us to the crux reciting experiences or piling up illustrations, of the whole matter, to the point of promise it is sufficient to say that farming is rated as and the point of difficulty in American rural an unsafe or undesirable credit risk.

credit legislation. Second-and fully as consequential as in- European land credit began a long time




ago among the impoverished landowners who but they originated in the necessities and pledged their wasted farms severally and col- were wrought out in the thinking of the peolectively for long time loans to be paid on the ple most concerned. In this country we are amortization or sinking fund plan, like mu- by legislation anticipating, with the hope of nicipal or industrial bonds. That was the averting or ameliorating, the dire distress Landschaft of Prussia, which in modified which was, as it were, the birth-pangs of form has been adopted in other European rural credit in Europe. To change the figure countries. The Raiffeisen rural bank, or of speech, the European system was an short-time credit society, began later among evolution. We are endeavoring to fashion a the lowly peasants who grouped themselves system out of hand. The European land together in a compact of unlimited liability on credit system was two hundred years in the the principle of life insurance, as thus de- making, the rural credit society some seventyscribed by Leone Wollemborg, of Italy, whom I five; we are trying to reach the same end in regard as the greatest of modern rural econo- less time--that is all. The danger is that mists :

we will neglect the important factor of educaSuppose you have before you one hundred

tion; our people are habituated to individualsmall working farmers; they all possess the

ism ; the great task will be to show them how qualities of honesty, industry, and labor ca. they may work together as groups, with limpacity; this is their only capital. Now, a capi. ited common liability, and yet retain their talist having a hundred such men before him personal freedom of business conduct. The might with safety, under certain conditions, process will be slow and doubtless beset with make them a loan of 50 francs each. The con.

much blundering, but I confidently believe ditions with which the capitalist has to reckon

we will make much faster progress than the are these : Of these one hundred men, some will certainly be afflicted with sickness, death, or

Europeans made. The Federal Farm Loan lack of employment. It is a well-known fact

Act is designed to establish standards of that some of these men will certainly suffer agricultural land value and to give deliberate from these causes, but it is impossible to say official appraisal of land securities. It will which man it will be-whether the tenth, fif. economize the process of land borrowing by tieth, or lundredth man. It is impossible, in bringing the borrower and the lender closer short, to foretell which individual of the group together. It will require the several States will be incapacitated and thus rendered incapa- to revise, simplify, and standardize their land ble of repaying his loan. But one thing is cer- registration statutes. Most important of all, tain: it will not be the whole group-only a

each borrower, in becoming a member of a certain proportion. Past experience indicates

local association in which he owns stock, that out of one hundred two individuals are likely to be incapable of repaying their loan,

becomes thereby a lender as well as a borwhile the others will be able to meet their

rower. As a lender he will have a personal obligations. Now, in order to meet the liability,

interest in making safe the loans of his assothe group must undertake to become responsi- ciation by seeing to it that the land is not ble for the two members who are likely to be appraised too highly, that the loan is used for unable to pay; they must become, in short, productive and not for speculative purposes, severally and collectively responsible for the

and that the land behind the loan is contotal loan made to the group. There will thus

served and intelligently cultivated. The imbe ninety-eight men to repay the loan made to the one hundred. They will thus be able to

portance of this dual relation of the borrower assume responsibility for a loan of 49 francs

and the lender is clearly set forth by Wollemeach instead of 50, for they will have to assume

borg as follows: responsibility for the two per cent who will be It is a well-known fact that public opinion is unable to pay, and, by making themselves col- nearly always inclined to side with the weak as lectively responsible for the loan, they will be against the strong, and as, rightly or wrongly, able to make it for 49 francs multiplied by 100. the debtor is generally considered the weaker It is thus seen that the mathematical formula party, he usually has public opinion on his side. on which these banks are able to secure their But in the case of the rural bank the situation capital is nothing more than an application of

is reversed. The heads of families in the village the same principle which governs insurance. constitute the membership of the rural bank, Therefore this principle of unlimited liability and, as they are all interested in seeing that the is the first principle underlying the rural banks. loans for which they are severally and col

lectively responsible are paid, public opinion in Both systems were stimulated by Govern

this case is on the side of the creditor and not mental aid in money, credit, or other favor, of the debtor.

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