A Stake in the Land Part 14

EXTENSION OF PUBLIC CREDIT

A last measure which is extremely important and must not be overlooked in any planning for land settlement is the extension of public credit to settlers through the Federal Farm Loan Board. This, of course, applies not only to the settlers in the colonies established by the Federal Colonization Board, but also to those of private colonization companies regulated and chartered by the Colonization Board, and to individual settlers. There must be certain safeguards against loss. To accomplish this there could be established a settlers' credit division in the Federal Farm Loan Bureau, with a special land colonization credit fund.

A similar plan was proposed in the bill introduced by Representative Knutson, May 27, 1919.[19]

Some such provision is indispensable in any comprehensive land policy, and should secure a place in legislative enactment.

CO-OPERATION INDISPENSABLE

No amount of legislation or smooth-running administrative machinery can provide, however, for one of the most fundamental factors in modern small-farm production.

Every colony of small farmers nowadays needs to provide for co-operation among its members. There is no other way for them to enjoy the technical advantages of large-scale farming in the buying of seeds, stock, fertilizers, tools, machinery, and other necessities at wholesale prices, in the selling of farm products at the best prices; in the establishment of creameries, etc. The buying of necessary costly machines, such as stumping machines, tractors, threshers, headers, is beyond the financial power of an individual settler. Even should he be able to acquire them, he cannot use such machines to their full capacity on his small piece of land. But in co-operation settlers are able to buy the heavy machinery and to use it to its fullest capacity. Mutual insurance and credit established through co-operation are another substantial a.s.sistance to the success of the settlers.

[Ill.u.s.tration: THIS SETTLER STARTED TEN YEARS AGO WITH NO MONEY]

The co-operative buying and selling organization of a Finnish farming colony in upper Michigan which the writer investigated in detail proved to be a great money saver to the settlers. The enterprise has grown from a small undertaking into the largest business organization in the town, with its great warehouse overshadowing the railroad station. In the beginning the surrounding native farmers and townspeople were hostile toward it. They both feared the compet.i.tion as well as the broader results of an undertaking of "foreigners," led by their "demagogic leaders." Its former opponents have radically changed their att.i.tude, and many are joining the organization. They find that co-operation means voluntary, concerted, and co-ordinated action for the common advantage, and that it is not contrary to the American spirit.

One of the leaders of the Finnish co-operative a.s.sociation explained that the defects of the local private stores served as the first inducement for the settlers to establish a co-operative store.

The private stores usually set arbitrary and high prices on the goods, which are often of poor quality and limited variety. As a result, a co-operative store among our settlers was established. We found that the a.s.sociation, in its meetings and activities, served as a school for the development of mutual understanding and fellow-feeling among its members. In the direction of Americanization our co-operative movement has done much good already. Its success has made the native farmers respect us. A number of them have already joined our a.s.sociation. Should our enterprise grow wider it may be expected to unite the farmers of different nationalities, immigrants and natives, into one community.

The interviews of the writer with the native farmers fully substantiated these statements of the Finns. One of them said that when the Finnish settlers came the native-born people did not expect much good from them.

They were looked upon as strange intruders, entirely ignorant in farming. But as time went on they made good not only as farmers, but also as business men in their co-operative buying and selling a.s.sociation. They were found to be good, sober, and industrious people.

The co-operative movement was apparent in northern Wisconsin, where numerous co-operative creameries have been organized among the settlers of various nationalities. The carrying of milk to the creamery results in the regular meeting of settlers every day; business meetings and other activities of the a.s.sociation afford opportunities for the settlers to get together and work together. In addition to this the immigrant settler, as a member of the co-operative a.s.sociation, comes face to face with the wider business world--banks, railways, commission merchants, manufacturers, market conditions, price fluctuations, etc. As an individual producer he comes to know the larger problems involved in marketing his product and his vision and understanding broaden.

Almost all immigrant settlers interviewed on the subject of co-operation were in favor of it. "Co-operation helps us!" were words often used in answer to the question why they favor co-operation. This "help" should not be understood in the material sense only. Co-operative action, though it begins in economics, extends to and ends in the creation of ideal, socio-psychological values. The co-operator works and fights in the spirit of solidarity. He satisfies his wants through concerted action. His psychology is more complex and his aims become higher than those of a private individual.

Co-operation is a child of necessity. It cannot be created by outside suggestion or mere preaching. When there is a need and conditions are favorable the co-operative movement comes into being. Unquestionably the need for co-operation is greater in the rural districts than in the cities, and yet the rural conditions in many respects make the development of co-operation more difficult. The main obstacles, according to the rural co-operators themselves, consist in the lack of business connections and markets, in the absence of knowledge of efficient business methods, and in credit difficulties. It is hard to find an able and trustworthy business manager for a co-operative store in a village.

Notwithstanding all difficulties, the co-operative movement among farmers and especially among immigrant settlers has lately begun to grow with extreme rapidity. For instance, in 1917 in the state of Wisconsin there were agricultural co-operative a.s.sociations in the following numbers: 380 creameries, 718 cheese factories, 98 feed and produce a.s.sociations, and 124 live-stock concerns.[20]

One of the first difficulties in the way of establishing a co-operative a.s.sociation is its incorporation proceeding. Most of the states up to this time have had no special laws covering co-operative a.s.sociations. In such cases they have to be incorporated under the laws relating to private companies or those covering charity and public-welfare a.s.sociations.

A number of states have enacted laws for the promotion and protection of co-operation among farmers. The Wisconsin law, Chapter 368, Laws of 1911, makes provision for the establishment of organizations conducting business on the co-operative plan. No member is allowed to own shares of a greater par value than one thousand dollars. No member is ent.i.tled to more than one vote. Dividends on the paid-up shares are allowed to be no more than 6 per cent per annum; 10 per cent on the net profits has to be set aside as a reserve fund. When this has acc.u.mulated up to 30 per cent of the paid-up shares, 5 per cent goes to the educational fund to be used for teaching co-operation. One half of the remainder of the profits has to be paid as a uniform dividend upon the amount of purchases of shareholders and upon the wages and salaries of the employees, while the other half has to be paid to the nonshareholders on the amount of their purchases.

In case of productive a.s.sociations, such as co-operative creameries, or elevators, dividends have to be paid on raw materials delivered. In case an a.s.sociation is both a selling and productive enterprise, the dividends may be divided on both goods purchased and material delivered.

All concerns which do not comply with the provisions of the above law are prohibited to use the term "co-operative" as a part of their corporate name or the designation of their business.

According to the Nebraska law, Senate File No. 88,

the words "co-operative company, corporation, or a.s.sociation" are defined to mean a company, corporation, or a.s.sociation which authorizes the distribution of its earnings in part or wholly on the basis of, or in proportion to, the amount of property bought from or sold to members, or of labor performed, or other service rendered to the corporation. A co-operative concern has the power "to regulate and limit the right of stockholders to transfer their stock, and to make by-laws for the management of its affairs, and to provide thereon the term and limitation of stock ownership, and for the distribution of its earnings."

The California law, Civil Code, Secs. 653M to 653S, provides for organization of agricultural, viticultural, and horticultural co-operative a.s.sociations which shall not have a capital stock and shall not be working for profit. Each such a.s.sociation shall determine by its by-laws the amount of membership fee, the number and qualifications of members, conditions of voting, the methods of business, and the division of earnings.

There is no question that every state must have special legislation for co-operative a.s.sociations quite distinct from that relating to private business concerns. A co-operative a.s.sociation must have the legal power to regulate and limit the right of shareholders to transfer their shares, to make by-laws for the management of business, to limit the share ownership, to decide on the proportion and method of distribution of its surplus earnings. It must limit dividends on shares to the prevailing rate of interest and provide a certain percentage for a reserve fund until the latter has acc.u.mulated up to a certain proportion of the capital invested.

A part of the remainder should be retained for educational and other social-welfare purposes, the rest proportioned to the amounts of goods purchased, products contributed, or services rendered. The co-operative law should provide for one-member-one-vote. Irrespective of the number of shares owned, or the goods purchased, or the products contributed, or the services rendered, only one vote should be granted to each member.

Aside from such legislation, each state, as in New York, should have a special office with adequate forces for the advice and direction of farmers and settlers who desire to organize a co-operative a.s.sociation, as well as for those who have already established such an a.s.sociation and are meeting with difficulties.

[17] _Reclamation Record_, Department of the Interior, Washington, D. C., July, 1918, p. 306.

[18] Wisconsin Statutes, Chap. 656, Laws of 1919, Sect. 1636-225.

[19] See chap. vi.

[20] _Bulletin No. 182_, May, 1917, Agricultural Experiment Station, University of Wisconsin.

PART II

VIII

RURAL EDUCATIONAL AGENCIES

The term "Americanization" is used in two senses. In the narrower one it applies to our immigrant population only, and in a broader sense it applies to everybody, natives and immigrants alike. This means the Americanization of America. This broader meaning embraces the whole national life in all its conditions, tendencies, and forms of expression.

When the writer accepted the invitation of the Study of Methods of Americanization to make a field investigation of rural developments from the viewpoint of Americanization, he was certain that the study must be conducted in relation to the immigrant colonies only. The study of the Americanization of America would lead us nowhere, especially in view of the smallness of available forces and the shortness of time. The study must be confined, therefore, to the immigrant elements of the population, and even then it could only be a preliminary survey to reveal the problems to be studied later in detail.

IMPORTANCE OF EDUCATION

But the first observations in the field study soon convinced him that a broader scope is inevitable. For instance, inquiry into the conditions of the immigrants in relation to the acquisition of land for cultivation necessarily led him to the general land question in the country, land policies, land laws, land-dealing methods. In even a more striking way did the field study of immigrant education in the rural districts lead to the question of general public education in rural communities regardless of their racial composition.

[Ill.u.s.tration: THESE CHILDREN AND TEACHERS IN NEW MEXICO JOIN FORCES TO WIPE OUT ILLITERACY]

[Ill.u.s.tration: THE LARGEST GIRL WON A PRIZE FOR SCHOLARSHIP]

Education has always been more of a problem in rural districts than urban.

Evidence of this is found in the 1910 Census, which shows that for every illiterate person living in an urban community there are approximately two living in rural communities. The higher per cent of illiteracy in the rural districts is even more marked in the states where immigrants are settling than in the country as a whole. In New Mexico, Arizona, and California the ratio is about 250 illiterates in the country to every 100 in the city.

Among the foreign born in rural districts in three of these states an exceptionally high per cent of illiteracy prevails. For Texas 35 per cent, New Mexico 34 per cent, and Arizona 37 per cent, of the rural foreign born are illiterate--in contrast to 13 per cent for the United States. With the exception of Louisiana these per cents are the highest in the country and presage a problem that cannot be overlooked in a consideration of land settlement for the foreign born.

Equally significant are the 1910 comparisons of the figures for immigrants' inability to speak English in urban and rural communities.

Although the contrast for the country as a whole is not so striking, being 21.9 per cent in cities as compared with 25.2 per cent in rural districts, the differences in the four states where new immigrants are settling on farms are considerable.

TABLE IV

PER CENT UNABLE TO SPEAK ENGLISH, OF TOTAL FOREIGN BORN, TEN YEARS OF AGE AND OVER, IN URBAN AND RURAL COMMUNITIES[21]

================================================ | Per Cent | ---------------+---------------| Ratio of | Urban | Rural | Rural to Urban ---------------+-------+-------+---------------- Texas | 41.8 | 64.0 | 153.1 New Mexico | 28.5 | 61.7 | 216.5 Arizona | 48.2 | 62.6 | 129.9 California | 10.5 | 22.4 | 213.3 |-------+-------+---------------- United States | 21.9 | 25.2 | 115.0 ================================================

Over 60 per cent of the foreign born in rural communities in Texas, New Mexico, and Arizona are unable to speak English. The princ.i.p.al foreign group is composed of Mexicans who come from a non-English-speaking country which has a high per cent of illiteracy. They go into the rural communities of these border states, where there is practically no schooling opportunity either for learning the English language or for learning to read and write. While only 22.4 per cent are not able to speak English in California rural districts, this is more than twice as many as are unable to speak it in California cities. This is a high ratio in the one state in the country which provides public settlement projects. While these situations are perhaps extreme, their existence is manifestly inexcusable in a land which prides itself on educational opportunity for all. There is virtually never equality of opportunity in rural and urban communities, for either native or foreign born, and the immigrant who lives on the land is especially handicapped.