' HOWFARMERS COOPERA 
 S AND DOUBLE PROFITS § 
 
 CLARENCE-POE •
 
 THE LIBRARY 
 
 OF 
 
 THE UNIVERSITY 
 
 OF CALIFORNIA 
 
 LOS ANGELES
 
 SIR HORACE PLUNKETT 
 
 His faithful and at last triumphantly successful work in getting Irish farmer* 
 
 organized for business co-operation should be an inspiration to 
 
 all who are trying to effect similar results in our own 
 
 country. (See Chapters XVIII. XIX. and XX.)
 
 How Farmers Co-operate 
 and Double Profits 
 
 First-Hand Reports on All the Leading Forms of Rural 
 
 Co-operation in the United States and Europe — 
 
 Stories That Show How Farmers Can 
 
 Co-operate by Showing How 
 
 They Have Done It and 
 
 Are Doing It 
 
 BY 
 
 CLARENCE POE 
 
 Editor "The Progressive Farmer;" Member Organization Committee 
 
 National Conference on Marketing and Farm Credits ; Chairman 
 
 Topics Committee National Farmers' Union ; Aathor of 
 
 "Cotton," "A Southerner in Europe," "Where 
 
 Half the World Is Waking Up." etc. 
 
 ^eh) gork 
 ORANGE JUDD COMPANY, Publishers 
 
 lonbon 
 Kegan Paul, Trench, Trubner & Company, Limited 
 
 1915
 
 Copyright 1915, by Clarence Poe. 
 All Rights Resewed 
 
 ENTERED AT STATIONERS' HALL. 
 LONDON. ENGLAND 
 
 Printed in U. S. A.
 
 HD 
 
 p7^^li 
 
 THIS BOOK IS DEDICATED TO 
 THE MEMORY OF 
 
 4Hp Jf atfjer anb iHotter 
 
 PLAIN, HARD-WORKING FARMER-FOLK. WITH WHOM I SHARED THE 
 POVERTY AND HARDSHIPS OF THE DAYS BEFORE EDUCATION 
 HAD BROUGHT THE HOPE OF BETTER THINGS, OR CO-OPERA- 
 TION POINTED OUT THE WAY -THE DAYS WHEN NO EQUI- 
 TABLE SYSTEM OF RURAL CREDITS OFFERED ESCAPE 
 FROM THE ROBBERY OF "TIME PRICES"; WHEN OUT- 
 WORN MARKETING METHODS LEFT TO OTHERS 
 ALL THE HANDLING OF OUR PRODUCTS AND 
 ALL VOICE IN PRICING WHAT WE BOUGHT 
 OF OTHERS OR WHAT OTHERS BOUGHT 
 OF US ; AND WHEN THE INEVITABLE 
 MORTGAGE FOLLOWED, MENAC- 
 ING LIKE A SWORD OF DAMO- 
 CLES, WHILE WE TOILED. 
 
 IN THE FAITH THAT THROUGH CO-OPERATION A 
 
 FAIHEE DAY NOW DAWNS FOR ALL WHO GROW THE FRUITS 
 
 OF THE EARTH, THIS BOOK IS OFFERED BY 
 
 THE AUTHOR 

 
 ACKNOWLEDGMENTS 
 
 The author has endeavored to make this volume a prac- 
 tical guide-book on the subject of rural co-operation — not 
 a book setting forth what might be done, but a book of 
 actual reports of what has been done and is doing; stories 
 based on first-hand investigations. 
 
 I went to Ireland, France and Denmark and have visited 
 State after State in our own Union expressly for the pur- 
 pose of seeing on the spot just what is being accomplished 
 in every important line of agricultural co-operation and 
 then giving this information directly to my readers. There 
 is, I believe, just one conspicuous success in agricultural 
 co-operation that I have wholly missed — the co-operation 
 of citrus fruit growers in Florida and California. I have 
 visited both these States, but I have not personally in- 
 vestigated their citrus fruit organizations. Nor have I 
 been able to visit the Arkansas Cotton Marketing Associa- 
 tion described in Chapter XVI. 
 
 In keeping with the spirit of this volume, I have thought 
 it best to have both these activities described, as other 
 activities are, from the standpoint or personal knowledge 
 and investigation. I am, therefore, indebted to my friend. 
 Prof. W. R. Camp, formerly of California, for preparing 
 Chapter XV almost as it stands, and to my friend Prof. 
 D. N. Barrow, for preparing the interesting report of the 
 Scott jCotton Growers' Association in Chapter XVI. 
 
 C. P.
 
 INTRODUCTION: AN APPEAL FOR LEADERSHIP 
 
 THIS book, as I have already suggested, is intended 
 as a guide-book to business co-operation among 
 farmers. And yet in the very outset I would say 
 this one emphatic word to the reader: We may 
 have any number of guide-books on co-operation, we may 
 have free and unlimited lectures, pamphlets, bulletins, etc., 
 describing the advantages of co-operation, and yet if one 
 thing is lacking we can do nothing. That one thing is 
 Leadership. 
 
 Knowledge, Faith, Leadership — this is the trinity of es- 
 sentials in rural co-operation, and the greatest of these is 
 Leadership. Give us Leadership and all the other things 
 will be added to us. 
 
 Let me, therefore, in the very beginning put this ques- 
 tion to the reader: Why not make yourself a leader of 
 progress in your neighborhood — a leader in bringing about the 
 co-operative spirit and co-operative effort f 
 
 Co-operation is, indeed, the master word of the new cen- 
 tury, and in your neighborhood and all other neighbor- 
 hoods all the farmers must learn to work together. 
 
 You can't farm profitably any longer unless you do. You 
 must work with your neighbors in buying fertilizers and 
 supplies. You must work with them in buying and using 
 modern labor-saving machinery. You must work with 
 them in getting more and better live stock. You must 
 work with them in packing, shipping and selling your crops 
 after you grow them. You must work with them to de- 
 velop some system of rural credits whereby men may help 
 one another out of the Slough of Debt and on to the High- 
 road of Independence. And having done all this, it will 
 yet remain true that you cannot have a satisfying life, no 
 matter how much money you make, unless your neighbors
 
 8 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 are educated, a reading people, well-informed, neighborly 
 and anxious to join with you for better schools, better roads, 
 prettier homes, a richer social and intellectual life, and for a 
 happy, "pull-together" neighborhood. 
 
 Get the vision, then, reader friend, young or old, man or 
 woman : You can't be as happy as you ought to be unless 
 your neighborhood is as happy as it ought to be. You 
 can't prosper as you ought to unless your neighbors prosper 
 as they ought to. Get the vision and keep the faith. Make 
 yourself a leader In revolutionizing your neighborhood. 
 
 Hard work? We know it. Slow work? There is no 
 doubt about it. But go to it with the foreknowledge that 
 the work will be hard and slow. Go to it even with the 
 knowledge that — hardest of all to bear — there will come 
 bitter days when the very men you yearn to help will judge 
 you wrongly and misinterpret your motives, and you will 
 weary of the struggle as Jonah did under his gourdvine, or 
 Elijah under the juniper tree, or as Moses grew sick at 
 heart when the Canaan-bound Hebrews mutinied because 
 he had not let them alone in their bondage. 
 
 Go to the work, we say, with the knowledge that it will not be 
 wholly easy, and yet with the knowledge that it will be glorious 
 in the end ; glorious even if you do not see the end, but die hav- 
 ing only inspired someone else to carry on the task you could 
 not finish. Be glad the task is hard; be glad it is a man- 
 sized job. There would be no heroism in doing it if it 
 were not. You gain no strength in wrestling with the weak, 
 but only in wrestling with the strong. And so you win 
 soul-strength, strength of character, only by doing hard 
 things. "Oh, do not pray for easier tasks," as someone 
 has well said, "but pray God to make us stronger men." 
 And Dr. S. C. Armstrong said a thing we should never for- 
 get when he declared: "Doing what can't be done is the 
 glory of living." 
 
 Despite all the difficulties, therefore, be content that your 
 own life will be incomparably richer, happier and more 
 meaningful if you will but throw your whole soul into the
 
 INTRODUCTION 9 
 
 big, unselfish task of making your community what it 
 ought to be — a community of comrade farmers, co-operat- 
 ing farmers, a community with more of beauty and thrift 
 and neighborlincss and intellectual stimulus in it than 
 would ever have been possible but for your efforts. 
 
 And in working out such an ambition, remember that 
 your first duty is to get your neighbors aroused. You must 
 carry knowledge to them, and not only knowledge but 
 inspiration. You must work with them and at them, with 
 infinite patience, to make them a reading people — to read 
 the books and papers that will help you in carrying out 
 your ambition ; and you must get them together early and 
 often in meetings and conferences. You must especially 
 watch the boys and girls who have ambition for progress, 
 nor yet despair of older men and women whose inertia and 
 conservatism may yet be broken through. 
 
 Then, too, you must work with one and all with the 
 knowledge that they are your brothers and your sisters — 
 that you are no better than they, and that some neglected 
 man or boy in the shabbiest clothes and in the meanest 
 house may have potentialities greater than anybody else 
 in the neighborhood. You must feel yourself always a co- 
 worker and never a commander ; you must be more anxious 
 to develop leadership in others than to have any prominence 
 of leadership yourself. 
 
 But most of all, you must have faith in men and women, 
 boys and girls — and not only faith in them but genuine love 
 for them. It is a great saying of Tolstoi's : 
 
 "We think there are circumstances when we may deal with human 
 beings without love, and there are no such circumstaiices ; you may 
 make bricks, cut down trees, or hammer iron without love, but you can- 
 not deal with men without it." 
 
 And one of the greatest leaders of men that this old world 
 has ever known uttered one of his profoundest thoughts when 
 he said that a man may speak with the tongues of men and 
 angels, and have all knowledge, and all faith, and all philan-
 
 10 now FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 thropy, and yet fail as a leader and a man, if he is without 
 love for his fellows. 
 
 And now by way of a practical application of all the fore- 
 going let me suggest ten practical ways for starting co- 
 operation in your neighborhood, indicating at the same 
 time portions of this book in which I have set forth the 
 experiences of other groups of farmers on each particular 
 point, 
 
 /. Are you trying to get your neighbors to buy their fer- 
 tilizers, feedstuffs, etc., co-operatively f 
 
 This is about the simplest of all forms of co-operation — 
 "the A B C of co-operation," as the Irish say — but the 
 economies so effected have often been eye openers to farm- 
 ers who have previously sat in darkness. Even if you have 
 no local farmers' club, you can still get your neighbors to 
 join with you and make a bulk order at considerable saving 
 to all concerned. But if you have a local organization you 
 can work more easily and effectively. 
 
 On this and allied subjects read Chapter III on "Co- 
 operative Buying." Read also the experiences of Minne- 
 sota co-operative stores in Chapter VIII, an Irish co-op- 
 erative purchasing society in Chapter XX, what French 
 farmers have done as described in Chapter XXII, and the 
 interesting experiences of Danish farmers as told in Chapter 
 XXVII. 
 
 2. Are you trying to get your neighbors to join with you 
 in buying and using improved farm machinery f 
 
 There is hardly a farmer in America but that should be 
 practicing this form of co-operation. Consider, for example, 
 how many hundreds of thousands of farmers have plowed 
 around stumps summer after summer their whole lives 
 through, simply because each one did not feel able to buy 
 a stump puller — when by joining together all could have
 
 INTRODUCTION 11 
 
 cleared their land of stumps at a minimum of expense and 
 without one inconveniencing the other. Check over the 
 following list of just a few machines that might be owned 
 in common and see if you cannot pick out certain neighbors 
 who would "go in with you" in buying and using some of 
 them to advantage : 
 
 1. 
 
 Stump puller. 
 
 14. 
 
 Stalk cutter. 
 
 2. 
 
 Manure spreader. 
 
 15. 
 
 Grain drill. 
 
 3. 
 
 Corn shredder. 
 
 16. 
 
 Mower. 
 
 4. 
 
 Corn harvester. 
 
 17. 
 
 Peanut picker. 
 
 5. 
 
 Fanning mill. 
 
 18. 
 
 Clover huller. 
 
 6. 
 
 Pea huller. 
 
 19. 
 
 Grain thresher. 
 
 7. 
 
 Spraying outfit 
 
 20. 
 
 Meat chopper. 
 
 8. 
 
 Canning outfit. 
 
 21. 
 
 Horse clipper. 
 
 9. 
 
 Cowpea thresher. 
 
 22. 
 
 Cement tile machine 
 
 10. 
 
 Traction plow. 
 
 23. 
 
 Road drag. 
 
 11. 
 
 Harvester and binder. 
 
 24. 
 
 Farm level. 
 
 12. 
 
 Lime and fertilizer distributor. 
 
 25. 
 
 Cane mill. 
 
 13. 
 
 Potato digger. 
 
 26. 
 
 Hay press. 
 
 It is an unprogressive farmer who doesn't own some of 
 these in co-operation with his neighbors. Even if he is a 
 rich plantation owner, he should nevertheless pursue this 
 policy as a matter of encouragement and help to his less 
 prosperous neighbors who may thus get help they would 
 otherwise lack. 
 
 On this point read the report of what some American 
 farmers' clubs have done as told in Chapter VI, an Irish 
 experience in Chapter XX, some successful French plans in 
 Chapter XXII, and the record of co-operation among Den- 
 mark's one-horse farmers in Chapter XXIII. 
 
 J. Are you working to secure any organisation of your 
 neighbors for marketing staple cropsf 
 
 In a country In which the power of organization has been 
 so convincingly demonstrated, it would seem to be a strange 
 question to ask a farmer, "In the marketing of your crops 
 are you as a lone individual (probably poorly informed at 
 best), going up single-handed against all the organized
 
 12 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 forces, powerful, wealthy and well-informed, now ready to 
 take advantage of you?" Have not the farmers' grain 
 elevators proved that every grain farmer should have part 
 in this movement? Have not co-operative cotton and to- 
 bacco warehousing and marketing (even though only in 
 their infancy) proved that by selling together cotton grow- 
 ers and tobacco growers can get better prices for these 
 staple crops? Are not the citrus fruit growers' association 
 and truck growers' organizations in various parts of the 
 country living examples of the fact that "in union there is 
 strength"? Has not co-operative live stock shipping brought 
 new profits to corn belt farmers? 
 
 Unless you are in some crop marketing organization, Mr. 
 Reader, you are sleeping on your opportunities. Resolve 
 now that your neighborhood will not market this year's 
 crop without some form of co-operative effort. 
 
 And here the reader may profitably consult the expe- 
 riences of numerous farmers' societies recorded in this 
 volume — the record of the citrus fruit growers of Florida 
 and California as told in Chapter XV, the magnificent show- 
 ing of the Eastern Shore of Virginia Produce Exchange, 
 Chapter XHI ; experiences in marketing wheat, Chapter 
 IX; cotton and cottonseed marketing experiences as told 
 in Chapters VI, XH and XVI ; the victory co-operation 
 brought Wisconsin berry growers, .Chapter X, etc. 
 
 4. Have you stock in any enterprise for the secondary 
 handling of your products^ 
 
 As we are emphasizing in Chapter I, our farmers should 
 not only make the profits on the production of their raw 
 material, but should co-operatively own and manage all the 
 enterprises for putting this raw material into what we may 
 call a secondary form. The quostion is, then, whether you 
 have stock in any— 
 
 1. Grain mill? 4. Or packinghouse? 
 
 2. Cotton mill? 5. Or tobacco prizery? 
 
 3. Or creamery? 6. Or cottonseed oil mill?
 
 INTRODUCTION 13 
 
 In other words, the author contends that what we may- 
 call "agricultural manufacturing" should be carried on in 
 enterprises co-operatively owned by farmers, the profits 
 being paid out in the form of patronage dividends to the 
 persons who furnish these profits. 
 
 For information on such enterprises in this country and 
 abroad — the creamery being unfortunately, however, the 
 one form of "agricultural manufacturing" in which co- 
 operation has made conspicuous progress — consult Chap- 
 ters VII, XVI, XVIII, XXIV and XXV. 
 
 5, Have you tried to organise your neighbors for co-op- 
 erative marketing of country produce and of live stock? 
 
 The old plan (or no plan) whereby one farmer went to 
 town with two dozen eggs, another with four or five 
 chickens, another with a ham, and another with a peck of 
 apples, must give way to some profitable co-operative mar- 
 keting method in each neighborhood. 
 
 Read in Chapter VI the story of one co-operative produce 
 marketing association in which the writer is a stockholder. 
 For reports of live stock shipping associations see Chapter 
 XI. 
 
 6. Have you joined with your neighbors in purchasing any 
 pure-bred live stock? 
 
 The use of scrub sires has been a bane of American agri- 
 culture. We cannot expect proper interest in stock raising 
 until our farmers have animals in which they can take pride 
 and which have been bred for profit making along certain 
 definite lines. Nor can we ever have this if each individual 
 farmer must purchase worthy sires for his own herds and 
 flocks. 
 
 Just as we are safe in saying, therefore, that the joint 
 ownership of farm machinery is one form of co-operation 
 in which every farmer should participate, so we say that
 
 14 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 every farmer should have an interest in some royal blooded 
 stallion, bull, boar or ram that he will feel proud to name 
 as the sire of his colts, calves, pigs or lambs. Talk this 
 matter over with your neighbors as one of the surest means 
 of starting co-operation. 
 
 7. Are you interested in or trying to encourage any mutual 
 insurance association? 
 
 Every farmer should belong to some co-operative fire 
 insurance association (they exist almost all over the coun- 
 try, and if you haven't a branch in your county, it should 
 be easy to organize one), and we should also have associa- 
 tions for mutual accident insurance, such as have proved 
 such a success among French farmers. 
 
 Read the reports of successful farmers' insurance asso- 
 ciations in America as given in Chapter XVII, and French 
 experiences as given in Chapter XXII. 
 
 8. Arc you a member of or trying to organise any credit 
 union or other rural credit association? 
 
 No matter what sort of system for lending money on 
 land our State or National government may devise, we 
 must have some societies through which farmers may pool 
 their savings and lend them out to one another on proper 
 security. Because not all features of the Raiffeisen credit 
 organization may suit America is no reason for saying 
 that none of their features will. Every farmer should be 
 a member of some form of local credit union or rural build- 
 ing and loan association. 
 
 Read the simple story of the Irish rural credit societies 
 in Chapter XIX, and see if there is really any reason why 
 some such plan could not be inaugurated in your neighbor- 
 hood. Or if some other plan seems necessary, note in 
 Chapter XIV that Catawba farmers have organized a rural 
 building and loan association and are making a success of it. 
 
 p. Are you a member of a co-operative telephone com- 
 pany?
 
 INTRODUCTION 15 
 
 Farmers should co-operate not only in matters which 
 insure financial profit, but in everything that makes for 
 the improvement of country life. The telephone is not 
 only profitable financially in that it will convey all kinds of 
 business messages that a man and a horse would otherwise 
 have to carry, but it enriches life for all the members of 
 the family. If every farmer in a neighborhood will do his 
 part, the cost per capita of a co-operative line will be small 
 indeed. 
 
 10. Are you co-operating to get for your family and your 
 neighbors the higher things of existence? 
 
 Are you a member of a farmers' club or local union or 
 grange? Is your boy in the corn club work and your girl 
 in the girls' canning club movement? Is your wife one of 
 the United Farm Women? Are you co-operating with 
 your neighbors educationally by supporting local taxation 
 for schools? Are you always ready to do your part when 
 the neighbors plan a Sunday school picnic or a Fourth of 
 July celebration or a baseball team or a "big day" at the 
 neighborhood school? And finally, are you co-operating 
 with your neighbors in the settlement of disputes by arbi- 
 tration — co-operation which eliminates the terrific expense 
 of unnecessary middlemen-lawyers? 
 
 This tenth item really presents an illustration of "the last 
 shall be first and the first shall be last," for the very first 
 step in business co-operation must frequently be the or- 
 ganization of farmers along social lines. It is equally true, 
 however, that without some successful business feature 
 about ninety-nine farmers' clubs out of a hundred fail. 
 The thing to do is to try to get the organization and then 
 give it something to do — or better still, have something 
 definite for it to do from the very beginning. 
 
 In the matter of suggestions for making a farmers' club 
 a success, read Chapter II, noting the manner of organiza- 
 tion, needed committees, plans for a rural census or
 
 16 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 survey, etc. ; read Chapter VI setting forth some practical 
 business activities of farmers' clubs, and note the activities 
 of some women's organizations in Chapters IX and XIV. 
 
 Upon general matters it only remains for me to say that 
 in Chapter VII, and in the Appendix, I have attempted to 
 give needed help about the method of organizing co-opera- 
 tive enterprises, v^^hat manner of by-law^s should be adopted, 
 etc. ; in various chapters throughout the book I have em- 
 phasized the importance of high-quality products; in 
 Chapter XXIV and others I have discussed briefly the neces- 
 sity for having legal, binding contracts and proper auditing 
 of the books; and in Chapters XXI, XXIII, XXVI and 
 XXVII I have brought out the fact that education and 
 home ownership form the only foundation for successful 
 co-operation or a satisfying rural life. Because tenancy 
 and ignorance exist in your neighborhood is not a reason 
 for shirking the battle, however, but only for making more 
 determined effort not only to get co-operation, but to pro- 
 mote education and home ownership. I have also called 
 attention, though not so emphatically as I ought, to the 
 importance of avoiding the credit system which has 
 wrecked probably ten thousand farmers' societies, and I 
 would reiterate that there is no safety outside the strictly 
 cash basis of operations. I would also urge Southern read- 
 ers interested in co-operation to consider the importance 
 of developing homogeneous communities, from the racial 
 standpoint. We simply cannot adequately develop rural 
 co-operation or rural community life where a population, 
 sparse at best, is divided between two races who are utterly 
 separate socially. Consequently where negroes cease to 
 become hired laborers or renters and become independent 
 landowners working for themselves, they should buy land 
 apart from those communities where white people wish to 
 develop a robust community life with a homogeneous white 
 population. In two school districts, each with fifty negro 
 landowners and fifty white landowners sandwiched to- 
 gether, neither schools nor churches nor social life can be
 
 INTRODUCTION 17. 
 
 half as good for either race as if the hundred families of 
 each race were grouped together. 
 
 May I not in conclusion again urge the reader to set out 
 to make himself a leader in rebuilding his neighborhood, 
 finding for himself the inner joy and happiness that comes 
 only through service to one's fellows and to some high 
 ideal? 
 
 "Oh, it is great and there is no other greatness/* says 
 Carlyle, somewhere, "to make some nook of God's creation 
 more fruitful, better, more worthy of God," and it is in the 
 quest of this form of greatness that one is surest to find 
 what President Eliot has happily called "the durable satis- 
 factions of life." To the man who has an ideal of a richer 
 and fuller life for his community and who unselfishly sets 
 to work to bring about this ideal, the glorious reward is 
 usually seen with the material eye long before age has 
 dimmed its vision. But to the triumphant spirit of every 
 man who seeks to hasten "the good day coming," it is 
 enough, even if only with the eye of faith, "he shall see the 
 travail of his soul and shall be satisfied," and dying 
 
 "Join the choir invisible , 
 
 Of those immortal dead who live again 
 In minds made better by their presence . . . 
 Whose music is the gladness of the world." 
 
 To such tasks, to such high spiritual adventures, are the 
 leaders of rural America now called. In fact, the by- 
 products of co-operation — comradeship, fellowship, that 
 new attitude toward life which has made Denmark "a little 
 land full of happy people" — these are so much more im- 
 portant than even the striking material rewards, that I 
 have hesitated to call this book "How Farmers Co-operate 
 and Double Profits." For, as a matter of fact, important as are 
 the dividends in cash, the dividends in brotherhood are 
 greater.
 
 TABLE OF CONTENTS 
 
 PLEASE USE THE INDEX.— The chapter headings in this book 
 indicate very incompletely at best the range of subjects covered. The 
 reader in quest of information on any particular point is therefore 
 urged on all occasions to consult the Index, beginning on page 239. 
 This Index not only indicates with greater precision where to find just 
 the information wished, but frequently enables the reader to compare 
 experiences of a considerable number of co-operative groups. The 
 ideal of the author, in fact, has been to inspire the general reader with 
 interest and enthusiasm for co-operation by means of genuine "human 
 interest" stories of co-operation experience, and also furnish, with the 
 added help of the Index, a practical guide book for those engaged in 
 organizing co-operative enterprises. 
 
 PAGE 
 
 CHAPTER I 
 The Farmer Must Take Complete Control of His Business 21 
 
 CHAPTER H 
 First of All a Good Local Farmers' Club : How to Make It a Success 29 
 
 CHAPTER HI 
 
 Co-operative Buying Is Good; Co-operative Merchandising May or 
 or May Not Be 37 
 
 CHAPTER IV 
 Rural Credits and Co-operation 48 
 
 CHAPTER V 
 Why I Believe in the Farmers' Union, Grange, etc 56 
 
 CHAPTER VI 
 
 Some Farmers' Clubs I Have Known : Examples of Neighborhood 
 Co-operation 63 
 
 CHAPTER VII 
 How to Organize a Co-operative Society : Some Fundamental Prin- 
 ciples . ..... 70 
 
 18
 
 TABLE OF CONTENTS 19 
 
 PAGE 
 
 CHAPTER VIII 
 
 How Co-operation Remade a Minnesota Neighborhood : A Properly 
 Organized Rural Community 75 
 
 CHArTER IX 
 Why Can't You Have a Neighborhood Like Svea? 83 
 
 CHAPTER X 
 
 How Wisconsin Berry Growers Met an Ugly Situation : Successful 
 Produce Marketing 90 
 
 CHAPTER XI 
 
 More Co-operation Stories from the Northwest: Co-operative 
 Laundry Work, Live Stock Shipping, Cheese Making, etc 95 
 
 CHAPTER XII 
 Co-operation to Get Better Cotton Prices 100 
 
 CHAPTER XIII 
 A $5,000,000 Truck Marketing Association in Virginia 113 
 
 CHAPTER XIV 
 A North Carolina County Co-operation Has Waked Up : Cream- 
 eries, Egg Collecting, Potato Marketing, Credit Societies, etc. 123 
 
 CHAPTER XV 
 What Florida and California Citrus Fruit Organizations Have Done 130 
 
 CHAPTER XVI 
 An Arkansas Cotton Marketing Association 137 
 
 CHAPTER XVII 
 
 Every Farmer Should Join a Mutual Insurance Company: What 
 Some Companies Are Doing 143 
 
 CHAPTER XVIII 
 Making Farmers into Business Men: How Co-operation Has Re- 
 made Rural Ireland 147 
 
 CHAPTER XIX 
 .Two Irish Rural Credit Societies and How Thev Work 155
 
 20 TABLE OF CONTENTS 
 
 PAGE 
 
 CHAPTER XX 
 
 The Large Outlook of Irish Agricultural Leaders: The Prob- 
 lems of Rural Co-cperation 164 
 
 CHAPTER XXI 
 Agricultural Co-operation in England 171 
 
 CHAPTER XXII 
 What Co-operation Has Done for French Farmers 178 
 
 CHAPTER XXIII 
 Co-operation Gives Danish Farmers Three Profits Instead of One. 186 
 
 CHAPTER XXIV 
 
 Cows and Co-operation Have Made Denmark Rich: Business 
 Methods and High Quality Products as Factors 194 
 
 CHAPTER XXV 
 Averaging $2 More Per Hog Through Co-operation: How Live 
 Stock Farmers Benefit 201 
 
 CHAPTER XXVI 
 "Folk High Schools" Made Danish Co-operation Possible 207 
 
 CHAPTER XXVII 
 Seven Secrets of Success with Danish Co-operation: The Ex- 
 perience of Denmark as a Lesson for America 213 
 
 APPENDIX 
 
 What Sort of By-Laws Shall We Have? 223 
 
 Regulations for a Co-operative Store 233 
 
 By-Laws of a Farmers' Club 235 
 
 Parhamentary Rules 237
 
 CHAPTER I 
 
 ff 
 
 THE FARMER MUST TAKE COMPLETE CONTROL 
 
 OF HIS BUSINESS 
 
 This Is the Fundamental Purpose of Rural Co-operation — 
 
 Profits Must Go to Patronage — Farmers Must Get Profits 
 
 Not Only from Growing Raw Material but from Grading 
 
 It, Converting It into More Finished Forms, and from 
 
 I ! Direct Marketing. 
 
 BUSINESS co-operation among farmers — what are 
 the fundamental purposes and principles of this 
 movement of which we now hear so much? This, 
 it seems to us, is the most pertinent consideration 
 for us in the very beginning of this volume. 
 
 The answer is, of course, that the object of rural co-op- 
 eration is to bring to the farmer not only the profits due 
 him as a laborer, but also profits which he may win as a 
 business man — by grading, developing and marketing the 
 products he has first made as a laborer. And the object is 
 not only to secure these extra profits for the farmers as a 
 class, but to secure their equitable distribution among in- 
 dividual farmers by dividing profits on the basis of patron- 
 age instead of on the basis of capital. 
 
 For centuries we have had an industrial system in which 
 money rules men. The dollar, "the almighty dollar," as 
 it has come to be known, is above the man. Money hires 
 men. The lowest possible wages are paid the workingmen 
 who turn out the products of the various businesses, the 
 highest possible prices are charged the consuming public 
 who buy these products, and then all the profits realized 
 between these minimum and maximum figures go to the 
 moneyed stockholders in proportion to their money. No 
 
 21
 
 22 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 matter how enormous these profits are, the men whose 
 sweat and labor have wrought out the product share none 
 of the benefits, nor does the consuming public receive one 
 cent of rebate. 
 
 The basic principle of co-operation, on the other hand, 
 is that men shall hire money instead of having money hire 
 men, and that after paying money its legitimate hire (a 
 reasonable rate of interest), all the remaining profits shall 
 go to the people who furnish patronage. 
 
 Now, there are a thousand patrons of a business for every 
 one stockholder in it. Consequently, when profits go to 
 patrons under the co-operation principle wealth is diffused 
 among many people ; when profits go to stockholders under 
 the corporation principle wealth is concentrated into a few 
 hands — and already 54.2 of our American families do not 
 even own the roof that shelters them, and not one man in 
 three lives in a home to which neither landlord nor mort- 
 gagee may lay claim. 
 
 A corporation is an assemblage of dollars for the purpose 
 of hiring men to secure profits for the dollars. Co-opera- 
 tion is the assemblage of men for the purpose of hiring 
 dollars to save profits to the men. And by this plan co- 
 operation aims to avoid both the Scylla of capitalism and 
 the Charybdis of socialism. It will not have the profits 
 of labor absorbed by fashionable idlers under the form of 
 plutocracy, nor by a different class of idlers under the form 
 of communism. It is for the men who work — the only sort 
 of men worth saving, the only sort of men society should 
 seek to serve. 
 
 In addition to the principle of paying dividends on patron- 
 age, there are, of course, certain other well-established prin- 
 ciples of successful co-operation, the main ones being sum- 
 marized under twelve brief heads in our chapter on "How 
 to Organize a Co-operative Society." 
 
 So much for the principles of business co-operation. 
 Now let us see what our forward-looking leaders of rural
 
 FARMER MUST TAKE COMPLETE CONTROL OF HIS BUSINESS 23 
 
 progress hope to win for the farmer by applying these prin- 
 ciples in agriculture. 
 
 Agricultural co-operation on the whole, then, let me say, 
 means simply that the farmer must take control of all 
 phases of his own business — the business of growing and 
 delivering to the world its food and the raw material for 
 its clothing. 
 
 Heretofore the farmer too often has been only a hireling 
 in his own house. He has been the laborer who did the 
 hard work but received only such profits as were left him by 
 his industrial masters — these masters being the men from 
 whom he bought his supplies; the men who converted his 
 products into secondary form; the men who marketed his 
 products ; and the men who lent him money to carry on his 
 business or to buy food from other farmers while he worked. 
 
 I hate demagoguery, and I would do nothing to stir up 
 class feeling; but the big facts in this matter must not be 
 blinked, and it will require only a little thought to show 
 that the farmer has surrendered to other interests all the 
 business side of agriculture apart from production, and that 
 all these other interests have prospered in greater degree 
 than has the farmer, who is the creator of all the basic 
 wealth. 
 
 The merchant who has sold the farmer his supplies ; the 
 grain buyers and cotton buyers and tobacco buyers and pea- 
 nut buyers who have marketed his product ; the millers and 
 packers and ginners and cottonseed oil men who have con- 
 verted his products into more finished forms; the money- 
 lenders and the time-merchants who have furnished him 
 credit — all these have taken their tolls, and in nearly every 
 instance their profits have been larger than those made by 
 the farmer himself. It has been asserted that in some lines 
 the farmer receives only thirty-five cents of the dollar which 
 the ultimate consumer pays for his product. 
 
 Now, let us see what are the lines of co-operation that we 
 must develop if the farmer is really to take control of these
 
 24 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 profit-absorbing phases of his own business, and get his 
 proper share of the final consumer's dollar. To effect this 
 result it seems to me that our farmers everywhere must 
 definitely resolve upon five general branches of rural co- 
 operation : 
 
 (i) Co-operation in buying supplies for making farm 
 products. 
 
 (2) Co-operation in raising farm products. 
 
 (3) Co-operation in finishing farm products. 
 
 (4) Co-operation in standardizing and marketing farm 
 
 products. 
 
 (5) Co-operation in securing capital for making and mar- 
 keting farm products, and in all necessary insurance. 
 
 Several of these five subjects have already been rather 
 abundantly discussed. Farmers are already pretty fully 
 converted to the idea of buying their supplies — fertilizers, 
 feedstuffs, etc. — on the co-operative plan. Farmers also 
 are rapidly learning the wisdom of co-operation in raising 
 farm products — co-operation in owning and operating wheat 
 threshers, stump pullers, corn harvesters, traction plows, 
 corn shredders, wheat drills and other labor-saving and 
 profit-making machinery, and co-operation in getting better 
 
 breeding sires. 
 
 They have been decidedly slower, however, in realizing 
 that it is part of the business of farming to co-operate in 
 finishing farm products — putting them into secondary form 
 — as it is a purpose of this book to urge. And by convert- 
 ing farm products into more finished forms, I mean such 
 work as that of cotton gins for separating the farmer's 
 seed cotton into lint and seed, cottonseed oil mills for con- 
 verting the cottonseed into meal and oil and hulls; grain 
 mills for converting the farmer's grain into flour and bran 
 and meal ; creameries for converting his milk into butter and 
 cheese; canneries for converting fruit and vegetables into 
 canned goods ; and packing houses for converting his hogs and 
 cattle into properly cured pork and beef products. All 
 these enterprises are distinctly a part of the farmer's busi-
 
 FARMER MUST TAKE COMPLETE CONTROL OF HIS BUSINESS 25 
 
 ness, and wherever business conditions make them profit- 
 able they should be conducted by him on a strictly co- 
 operative basis. 
 
 In other words, I maintain that it is the farmer's duty 
 to give the world its food and the raw material for its cloth- 
 ing, and that he should conduct and receive profits from all 
 the business operations of delivering the food to the con- 
 sumers and the lint cotton and the wool to the factories. 
 The principle has its bounds, of course, but I maintain, for 
 example, that it is as much the farmer's business to grind 
 the corn as to shell it, and as much his business to gin the 
 cotton as to pick it. It is because the farmer has hereto- 
 fore lost the profits on all such operations and on all the 
 business of handling his crops that he is poor. As Prof. 
 E. C. Branson has so well said : 
 
 "The farmer's wealth-producing power is enormous ; his wealth- 
 holding power is feeble. The retention of wealth is everywhere our 
 greatest problem; not merely the production of wealth." 
 
 Think of our annual billion-dollar cotton crop, and then 
 of how few millions will be left to our farmers as profits 
 after the farmer satisfies all the agencies that now take 
 toll from his wealth before he gets "the leavings." 
 
 Twenty years ago, as we shall see later on in this volume, 
 the dairy farmers of Ireland and Denmark were doing 
 exactly as our American farmers are doing today. They 
 were simply following the old system of "every man for 
 himself" and letting the bulk of their profits slip through 
 their fingers — part going to the merchant who sold them 
 feedstufifs, part to the capitalists who owned the creamery 
 and bought their milk and butter, part to the middleman 
 who marketed the finished products for them, and part (or 
 the rest) to the money lender or "gombeen-man" (time mer- 
 chant) who made them advances. 
 
 Today, however, these farmers have made themselves 
 independent by taking complete control of their business
 
 26 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 just as I am saying the American farmer must take complete 
 control of his business. 
 
 They have co-operative purchasing societies for buying 
 their feedstuffs together and save a profit here. They have 
 co-operative creameries for converting their milk into 
 butter and cheese and save a profit here. They have co- 
 operative societies in marketing direct to English and 
 German markets and save a profit here. And they have 
 co-operative credit societies and save a profit here. 
 
 In other vi^ords, the co-operative Irish and Danish farm- 
 ers have taken complete control of their business from start 
 to finish, just as our American farmers must do. No won- 
 der Hans Hansen, a Danish farmer who had formerly cul- 
 tivated a i6o-acre farm in America, told me at his home in 
 Denmark that, thanks to this fuller degree of co-operation 
 there, he was doing about as well with thirteen acres there 
 as he did with i6o in America. Certainly if these Irish and 
 Danish farmers were in our shoes, they would soon have 
 co-operatively owned cotton gins, cottonseed oil mills, cot- 
 ton and tobacco warehouses, packing houses, grain eleva- 
 tors, grain mills, etc., etc. (not by starting new enterprises 
 in communities already fully supplied, but by buying out 
 plants already running or else establishing new ones in 
 communities not properly supplied at present), and they 
 would buy fertilizers together direct from the factory; 
 they would co-operate for economical production ; they 
 would standardize grades and market their cotton co-op- 
 eratively; and they would provide some form of co-opera- 
 tive rural credits. 
 
 I repeat that I am not advising farmers to start new 
 co-operative gins or mills or warehouses where there are 
 plenty of these privately owned. But they may well buy 
 out an established plant in such cases and put it on the 
 co-operative or "patronage-dividends" basis, or they may 
 establish such new co-operative enterprises outright where 
 the business justifies it. 
 
 The enormous losses in grading and marketing cotton
 
 FARMER MUST TAKE COMPLETE CONTROL OF HIS BUSINESS 27 
 
 under present conditions offer a fine illustration of what 
 our farmers lose by not taking charge of the marketing end 
 of their business. We should both establish co-operative 
 selling agencies and establish a definite and officially recog- 
 nized standard of grades. Organized or co-operative mar- 
 keting is the only plan whereby the farmer can get the 
 benefit of proper grading of his products — 
 
 (i) Because the organization can employ an expert grader, 
 whereas the individual farmer cannot become an expert in 
 this work ; and — 
 
 (2) Because an association of farmers can guarantee 
 grades and insure the acceptance of their grading work by 
 the commercial world as an individual farmer cannot. 
 
 The fifth and last form of co-operation to which farmers 
 must give attention is the rural credit society, the organiza- 
 tion of a group of farmers in each community for the pur- 
 pose of obtaining and lending money to their members at 
 low rates of interest for productive purposes. It is to our 
 everlasting discredit that we have yet done nothing in this 
 respect, for not only have these organizations pulled 
 thousands and thousands of Irish farmers and Danish 
 farmers and German farmers out of the mire of 
 poverty, but when I was in Japan I found that even these 
 so-called "heathen" farmers had for years been improving 
 their opportunities in this respect ; and when I went down 
 into India I found that even "the poor, benighted Hindus" 
 had realized the advantages of co-operation in rural credit 
 and that the British government was actively assisting 
 the heathen worshipers of idols over there in this advanced 
 step which we in America have not yet taken. 
 
 The conclusion of the whole matter is simply that the 
 twentieth century farmer is yet going to become master in 
 his own house, is yet going to take charge of the whole 
 business of agriculture, and will absorb all the profits of 
 the processes of supplying the world with food and with 
 raw material for its clothing. He will not be content merely 
 to grow the raw product as a low-priced muscular laborer.
 
 28 
 
 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 lii 
 
 and let all the profits of handling and selling the product 
 go to other classes. Instead, the farmer is to be both 
 laborer and business man. He is to get one profit from 
 growing the product ; he is to get still another profit from 
 grading, finishing and marketing it. Heretofore he has 
 made one profit by working alone, as an individual being; 
 henceforth he will make another profit by working with 
 others as a social being. 
 
 There must be co-operation (i) in buying supplies, (2) 
 in crop production, (3) in crop finishing, (4) in crop market- 
 ^"g"» (5) Ji^ rural credits. The farmer must take complete 
 control of his business.
 
 CHAPTER 11 
 
 FIRST OF ALL, A GOOD FARMERS' CLUB 
 
 Have Regular Programs and "Roll Call of Opinions" — Eight 
 Permanent Committees That Should Be Ahvays Active — 
 Make Community Surveys and Have Public Meetings — 
 How to Get Outsiders Interested. 
 
 THE very first thing to do in getting business co- 
 operation started in your community is to get 
 your neighborhood waked up. And the best way 
 to get it waked up is to organize a farmers* 
 club and a club of farm women. Don't organize merely 
 because "all other classes are organized and farmers ought 
 to be," but organize for business — determined to do some- 
 thing. 
 
 In order to get a club started, the leader should first try 
 to interest a half dozen neighbors, or as many as he can, 
 and try to get the biggest possible crowd in starting. Have 
 a speaker or organizer from a distance if possible — not a 
 mere exhorter, but a man who will give practical sugges- 
 tions for making the club a power in the community. We 
 would also suggest that you link up your club with what- 
 ever general organization the farmers of your State 
 have. Union, Grange or Society of Equity, as the case may 
 be. In some states there is nothing but the Union, in. 
 others nothing but the Grange, and so on. 
 
 Then having brought your farmer neighbors or your 
 neighbor women together into the organization, the next 
 thing to do is to make your meetings interesting. If the 
 secretary simply calls the roll, reads the minutes of the last 
 meeting, and the president merely puts through the formal 
 "Order of Business," your club will soon starve to death. 
 
 28
 
 30 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 The writer now belongs to a live, active, useful local union 
 of seventy-five members, and we are confident it would not 
 be half so strong but for the fact that for two years past 
 it has had a fixed program for each meeting, with one or 
 two speakers assigned to each subject and given sufficient 
 advance notice to enable them to prepare themselves 
 properly. 
 
 Another excellent idea is to have a "Roll-call of Opin- 
 ions" at each meeting. After the regular speakers have 
 expressed themselves on the subjects assigned for discus- 
 sion, call on each member present to give his opinion within 
 a one, two, three or five-minute time limit, as the circum- 
 stances may seem to require. In this way you will call out 
 the quieter and less active members and frequently develop 
 qualities of leadership in them which might otherwise never 
 come to life. And just here it should always be remem- 
 bered that the sort of leaders we need in every organization 
 are not those who wish to magnify their own importance 
 and demonstrate their own superior abilities, but men with 
 that truer sort of leadership who will seek out and develop 
 all the force and power in other men, finding more pleasure 
 in developing others than in exhibiting themselves. 
 
 A chief object of your organization in every case must be 
 to make your neighborhood not a collection of individuals, 
 but a real community — and there is indeed a great distinc- 
 tion here. As Mr. George W. Russell of the Irish Home- 
 stead has well said, we have had until now virtually no 
 rural "communities." We have had rural sections in which 
 individuals live here and there ; but we have not had neigh- 
 borhoods of people bound together by common interests 
 and common ideals — a community consciousness. 
 
 The truth of this observation must be only too plain to 
 all thinking people. Consider the city nearest you, how its 
 inhabitants boast of its growth in population, in postoffice 
 receipts, in bank deposits, in office buildings! How they 
 brag about its factories, industrial plants, big stores; its 
 schools, its parks, its streets, its public buildings — or at
 
 FIRST OF ALL, A GOOD FARMERS* CLUB 31 
 
 least about each item in which it makes a better showing than 
 its nearest rival city! There are slogans, "Bigger, Busier, 
 Better Beantown," "Watch Jonesville Grow," or "Boom- 
 town Leads,- Others Follow," etc., which flaunt themselves 
 in colored signs by day, flare forth in electric lights by night, 
 or strut vaingloriously on your city friend's lapel as you 
 talk with him. 
 
 What we need now is to develop a like community spirit 
 in our country districts. Why should not the people living 
 in a rural school district or a rural township boast of hav- 
 ing the best roads in the county, or the best school, or the 
 best school library, or the biggest corn club, or the greatest 
 number of painted houses, or the best farmers' club, or the 
 most houses with waterworks, or the most silos, or the most 
 registered cattle, or the most attractive social life — which 
 is to say, the most neighborly people? Why shouldn't they 
 1; be ready to come together in a public meeting to take action 
 || about any plan affecting the people of the neighborhood ? Why 
 [| shouldn't the local farmers' club be as active in promoting 
 every idea for the upbuilding of the community as the city 
 chamber of commerce is in promoting every idea for the 
 upbuilding of the city in which it is located? 
 
 We believe, in fact, that this should be a main purpose of 
 the local club, and to this end we would suggest that the 
 regular program be sidetracked at any tinre in order to have 
 the members discuss and act upon any matter of neighbor- 
 hood betterment. Furthermore, we would suggest that 
 there be a special committee to look after each leading sub- 
 ject affecting the life of the community. 
 
 At a recent conference in which the writer participated 
 it was agreed that a suitable list of committees for such a 
 farmers' club would be : 
 
 (1) Committee on Farm Production. — Soil fertility, scientific and 
 progressive crop growing and stock raising; improved tools and ma- 
 chinery and co-operation in their use. 
 
 (2) Committee on Marketing and Credits. — 
 (a) Marketing crops and produce.
 
 32 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 (&) Co-operative buying. 
 (c) Rural credits, and thrift. 
 
 (3) Committee on Social Life. — To encourage all forms of useful 
 recreation, local fairs, baseball and other games; school and neighbor- 
 hood picnics; Christmas, Easter, July Fourth and Thanksgiving cele- 
 brations; corn shuckings; quiltings; debates; musicales; reading circles, 
 etc., etc. 
 
 This committee would also be expected to look after the question 
 of good roads. 
 
 (4) Committee on Educational Work. — This committee, it was de- 
 cided, would be expected to look after — 
 
 (a) Improving the school. 
 
 (&) Extension work; lectures; library development, getting 
 
 books, bulletins, and papers into all homes, etc. 
 (c) Boys' and girls' farm clubs. 
 
 (5) Committee on Moral Conditions and Improvement. — To com- 
 bat all agencies of dissipation or immorality ; develop church and Sun- 
 day school interests and enlist these in the efforts for community de- 
 velopment. 
 
 (6) Committee on Health Conditions and Improvement. — To study 
 conditions and adopt means for .promoting the health of the com- 
 munity. 
 
 (7) Committee on Woman's Work. — To look after home equipment, 
 to work out plans for household management, home industries, recrea- 
 tion for the farm woman; and so on. 
 
 (8) Committee on Arbitration. — To settle all disputed matters and 
 to advise as to arbitration of private disputes. 
 
 After the committees are appointed chairmen should be 
 required to report progress at each meeting, or failing, 
 unexcused, to report at two successive meetings, should be 
 understood as resigning, and it should also be understood 
 that any member of a committee who is absent without 
 excuse from three successive meetings of his committee 
 would thereby retire himself, the chairman immediately 
 naming a successor. 
 
 Of course, if you are going to improve your neighborhood, 
 the first thing to do is to ascertain in what respects it most 
 needs improvement. If you should get sick and send for 
 a doctor and he should come one day and give you a lot of 
 medicine and wait till next day to look at your tongue and
 
 FIRST OF ALL, A GOOD FARMERS' CLUB 33 
 
 feel your pulse and ask about your digestion and take your 
 temperature, you wouldn't think much of that doctor. 
 
 In the same way, if you organize a lot of people interested 
 in bettering your community, the first thing to do is to find 
 out what ails the community. For this reason the very first 
 thing to do is to make a census or "survey" of social, indus- 
 trial, educational and health conditions. A friend of the 
 writer's, Mr. John W. Robinson, told us recently how his 
 local Union, by paying a competent young man $1.50 
 a day, in three days made a remarkable census of the whole 
 community, getting answers to forty-eight pertinent questions 
 from the fifty-eight families in the school district. With this 
 comprehensive information before it, the local Union and 
 its allied club of United Farm Women were prepared to 
 go right to work to meet the community's most pressing 
 needs. They knew how many families were not repre- 
 sented in church or Sunday school ; how many children 
 were out of school ; how many families took no farm paper, 
 and how many no county paper; how many did not patron- 
 ize the school library; how many used patent medicines; 
 how many boys were in the corn club, and how many girls 
 were in the tomato club ; how many farmers not in the 
 Union and how many farmers' wives not in the United 
 Farm Women; how many farmers had attended the insti- 
 tute the previous year, and how many women the women's 
 institutes, etc. 
 
 It is just such information, together with similar specific 
 information as to farming practices, marketing methods 
 and rural credits that every farmers' club should have in 
 definite shape before going ahead with its work. 
 
 The writer, as chairman of a state committee on this 
 subject, recently worked out, in collaboration with others, 
 a series of fifty questions bearing on community condi- 
 tions, and this list of questions has now been used in mak- 
 ing the "rural census" in hundreds of school districts. 
 
 We are printing herewith a list of these questions as used 
 in a recent survey of one rural county (Moore County,
 
 34 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 N. C), together with the number of farmers answering 
 "yes" and the number answering "no" to each. We would 
 
 commend these fifty questions to readers as a basis for 
 diagnosing neighborhood life in any section. 
 
 QUESTIONS ASKED HEAD OF EACH FAMILY 
 
 QUESTIONS YES NO 
 
 1. Do all your children between six and sixteen attend 
 
 school? 255 27 
 
 2. Is any boy or girl in your family attending college? 6 263 
 
 3. Do any of your boys study the school books on agricul- 
 
 ture? 53 280 
 
 4. Do your boys and girls study the health books? 149 96 
 
 5. Do your children read any library books? 211 176 
 
 6. Do you take a county paper? 189 112 
 
 7. Do you take a farm paper? 206 112 
 
 8. Do you get the agricultural department farm bulletins? 141 140 
 
 9. Do you own your farm? 269 37 
 
 10. Do you belong to a farmers' organization? 120 181 
 
 11. Does your wife belong to a woman's club? 17 136 
 
 12 Do you attend the farmers' institute? 226 150 
 
 13. Does your boy belong to a corn club? 10 249 
 
 14. Does your girl belong to a canning club? 63 234 
 
 15. Are you a church member? 245 60 
 
 16. Do your children attend Sunday schools? 226 58 
 
 17. Do you own farm machinery in co-operation with your 
 
 neighbors? 72 226 
 
 18. Do you co-operate with your neighbors in buying fer- 
 
 tilizers, feedstuffs, or other supplies? -— 136 147 
 
 19. Do you co-operate with your neighbors in marketing 
 
 your crops? 87 216 
 
 «0. Do you have a garden all the year around? 225 76 
 
 21. Do you usually have milk and butter all the year 
 
 around? 250 58 
 
 82. Has the farm demonstration agent helped you this year? 60 237 
 
 23. Do you buy corn? 120 186 
 
 2^. Do you buy meat? 213 120 
 
 25. Do you buy hay? 42 266 
 
 26. Do you raise corn to sell? 93 211 
 
 27. If you sell corn, are you able to get a fair price for it 
 
 in cash? 187 42 
 
 28. Have you pure-bred cattle? 95 192 
 
 29. Have you pure-bred poultry? 140 190 
 
 80. Have you pure-bred hogs? 142 162 
 
 31. Do you sell any hogs, cattle, pork or beef? 162 130 
 
 32. Is there competition between the buyers of the farm 
 
 products you sell? 79 171
 
 FIRST OF ALL, A GOOD FARMERS* CLUB 35 
 
 t 
 
 QUESTIONS YES NO 
 
 33. Do you keep informed concerning prices in more than 
 
 one market? 185 81' 
 
 34. Have you helped your local bank by depositing your 
 
 savings in it? 119 181 
 
 35. Has your bank ever helped you by lending you money? 93 181 
 
 36. Does the buyer alone determine the grade of your cot- 
 
 ton, tobacco, peanut or other money crop? 190 108 
 
 37. Do you use patent medicines? 130 164 
 
 38. Is your house screened? 106 194 
 
 39. Do you sleep with your windows open in winter? 171 132 
 
 40. Do you get R. F. D. service? 218 94 
 
 41. Would you favor a reasonable tax for road improve- 
 
 ment? 234 77 
 
 42. Is there a telephone in the house? 58 258 
 
 43. Do you have to carry water over 100 yards? 89 220 
 
 44. Is your house insured against fire? 60 240 
 
 45. Do the boys have Saturday afternoons off for baseball 
 
 or other recreations? 94 165 
 
 46. Is the house painted?—- 63 234 
 
 47. Are the outbuildings whitewashed? 11 273 
 
 48. Would you favor larger schools with more children, 
 
 more teachers, better paid, larger and better house 
 
 and grounds? 191 116 
 
 49. Would you favor industrial, agricultural and some high 
 
 school subjects in your school? 243 63 
 
 60. Would you favor enlarging the school district by con- 
 solidation, with transportation where necessary and 
 
 voting reasonable local tax to secure these results ?__ 87 216 
 
 In appointing the committees we have indicated for your 
 farmers' club, we would also suggest that you do not make 
 them up entirely of members of your own club. Put on 
 each committee, of course, three or five of your ablest mem- 
 bers who are definitely interested in the subject assigned, 
 but add two or three outsiders who you know will do good 
 work as associate members to act with them. Both men 
 and women should be on each committee. 
 
 Then arrange public meetings, say once a quarter, or at 
 least twice a year, inviting everybody in the community, 
 young and old, male and female, to attend and join in dis- 
 cussion of the plans developed by the committee — plans for 
 better farming, marketing, etc., and plans for making the 
 neighborhood a better place to live in. At the first public
 
 36 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 meeting it will be a good idea to present the results of your 
 census or survey and have local speakers tell what plans 
 for progress they think should be taken up. Both by nam- 
 ing some outsiders as associate members of your commit- 
 tees and by getting other outsiders to attend your public 
 meetings, you w^ill increase the interest in your organiza- 
 tion, and by showing that there is real work to be done, 
 win many to membership and activity. Picnic features 
 will also prove helpful. 
 
 Now, Mr. Farmer, Mrs, Farmer, seeing what can be done 
 (for if you do not need all these plans you will certainly 
 need some of them), why not set about organizing your 
 neighborhood this year? It's the only way to develop a 
 live community. The New England "town meetings" 
 (township meetings, in fact) did much to make New Eng- 
 land great ; but in the South and West we have no similar 
 occasions for bringing together all the people of a township 
 or school district. 
 
 The best plan is to have a strong graded school and make 
 it the social center of your community, have your club 
 meetings there, and let all the activities of the neighbor- 
 hood group themselves around the school. But unless you 
 organize your farmers and farm women in some way, noth- 
 ing else can possibly make your section the progressive 
 community it ought to be.
 
 CHAPTER III 
 
 CO-OPERATIVE BUYING IS GOOD; CO-OPERA- 
 TIVE MERCHANDISING MAY OR MAY NOT BE 
 
 Co-operative Merchandising Not the Highest Form of Co- 
 operation — Rules That Should Be Observed in Any Case — 
 When Farmers Are Entitled to Manufacturers' Prices — 
 Why They Should Buy for Less Than Town Patrons — 
 Farmers Should Club Together and Place Monthly or Semi- 
 Monthly Bidk Orders — Better Borrow at 6 or 8 Per Cent 
 Than Pay lo to 70 Per Cent in Form of "Time Prices" — 
 Co-operative Merchandising a Better Thing to "Grow" Into 
 Than to "Go" Into. 
 
 WHENEVER a group of farmers organize, one of 
 the first questions likely to come up is as to whether 
 it is wise to buy a stock of goods and run a "co- 
 operative store." Of course, there is no one answer 
 that can be given to fit all cases. It depends, for one thing, 
 upon whether or not the prospective manager is absolutely 
 known to be a good business man. It depends also upon 
 whether the organization has a large enough membership to 
 insure patronage enough to make the venture a success — in 
 connection with whatever patronage may be safely counted 
 on to come from outside. 
 
 And then the prospective stockholders or promoters should 
 also consider this important fact — that farmers almost every- 
 where can get quotations on short notice and do most of the co- 
 operative buying that is necessary by joining together and 
 ordering what they want and paying cash, without running 
 the risks (and they are big risks for inexperienced men) that 
 are involved in purchasing a stock of goods and hiring a man 
 
 37
 
 38 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 to sell them. Of course, whenever and wherever you hire a 
 man to stay with a stock of goods and sell them, his salary 
 must be added to the selling price. 
 
 Certainly farmers should not start a new store in an area 
 already abundantly supplied with merchants without first 
 giving the matter very serious thought. In Wisconsin, 
 Minnesota and nearby states a considerable number of 
 co-operative stores are now succeeding admirably, but in 
 most cases it has been the policy to buy out some existing 
 store rather than start a new one outright. "We have 
 enough middlemen already," these wise Western farmers 
 have said. "We don't want to increase the number." If 
 they think a co-operative store is needed they watch their 
 chance and buy out some merchant when he is willing to 
 sell at a reasonable price. 
 
 There is one fact that we would emphasize in any case, 
 and that is that buying ordinary groceries and dry goods is 
 nowhere the big and significant form of co-operation to 
 which our farmers must give attention. Consequently, if 
 you and a group of neighbors buy a little stock of calico, 
 plug tobacco. Western side meat, and granulated sugar, 
 and hire a manager to sit down and wait for customers, 
 don't fool yourself into thinking you have then started the 
 best form of co-operation. 
 
 Simply taking stock in a proposition like this and wait- 
 ing for whatever success or failure follows will not develop 
 the co-operative spirit among you ; will not make real 
 business men out of you ; will not develop the genuine 
 '"pull together" spirit among you. It is both more risky 
 'and less beneficial than other forms of co-operation. It is 
 more risky than these, even if you are wise enough to sell 
 only for cash — because inexperienced men will not select 
 stock wisely, and because unless you have a big sale your 
 running expenses are likely to more than eat up your 
 profits, and especially because nine stores out of ten will 
 sooner or later invite disaster by selling on credit.
 
 CO-OPERATIVE BUYING IS GOOD 39 
 
 Consequently, while we believe co-operative stores are 
 advisable in many instances, we believe five rules regard- 
 ing them should always be observed : 
 
 (i) They should never be started until a thoroughly safe 
 manager is found ; 
 
 (2) They should have what seems to be an adequate 
 patronage in prospect — either through superseding an ex- 
 isting store or by taking over the patronage of a co-opera- 
 tive purchasing society; 
 
 (3) They should sell only for cash ; 
 
 (4) They should comprise townsmen as well as farmers ; 
 and 
 
 (5) They should pay only legal interest on stock and 
 divide all other profits on patronage. 
 
 What is probably a wise provision, however, is the plan 
 of giving twice as great profits on patronage furnished by 
 stockholders as on that furnished by non-stockholders — 
 provided every man is free to buy stock. This plan of 
 "double dividends for stockholders" naturally encourages 
 every man to take one or more shares. 
 
 Moreover, we repeat that even when all these conditions 
 are met, we regard co-operative merchandising as both 
 more risky and less beneficial for farmers than co-opera- 
 tion with regard to the three bigger and more necessary 
 lines directly affecting farm work and life — co-operation in 
 producing, marketing and financing the farmer's crops. All 
 the three forms of co-operation just mentioned require 
 business thought and foresight and prudence and fellow- 
 ship on the part of the individual co-operators, and a will- 
 ingness to pull together and bear one another's burdens — 
 in greater degree than is required in conducting a co- 
 operative store, whose affairs are left largely to the man- 
 ager. These are the things that develop character and a 
 spirit of brotherhood, a feeling of unity, a capacity for 
 team work — things which our farmers need much more 
 than they need the money they may get even from success- 
 ful co-operative stores.
 
 40 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 To make my position perfectly clear, I think I ought to 
 repeat that I believe every farmer should participate in 
 co-operative buying, but I should not say at all that every 
 farmer should participate in co-operative merchandising. 
 Ordering together certain definite supplies you need in 
 farm work — this may be a very dififerent proposition from 
 buying a miscellaneous assortment of goods and hiring 
 a man to sell them to a miscellaneous body of people. This 
 latter policy may or may not be a desirable form of co- 
 operation; that will depend upon local conditions. But in 
 any case farmers should join together to buy their fer- 
 tilizers, feedstuffs and machinery, whether bought through 
 a local merchant or from a distant dealer. Upon this point 
 Mr. George W. Russell of the Irish Agricultural Organiza- 
 tion Society has well said: 
 
 "You must bear in mind, what is too often forgotten, that farmers 
 are manufacturers, and as such are entitled to buy the raw materials 
 for their industry at wholesale prices. Every other kind of manufac- 
 turer in the world gets trade terms when he buys. Those who buy, not 
 to consume, but to manufacture and sell again, get their requirements 
 at wholesale terms in every country in the world. If a publisher of 
 books is approached by a bookseller he gives that bookseller trade 
 terms, because he buys to sell again. If you or I as private individuals 
 want one of those books we pay the full retail price. Even the cob- 
 bler, the carpenter, the solitary artist, get trade terms. The farmer, 
 who is as much a manufacturer as the shipbuilder, or the factory pro- 
 prietor, is as much entitled to trade terms when he buys the raw ma- 
 terials for his industry. His seeds, fertilizers, plows, implements, 
 cake, feeding stuffs, are the raw materials of his industry, which he 
 uses to produce wheat, beef, mutton, pork, or whatever else; and, in 
 my opinion, there should be no differentiation between the farmer 
 when he buys and any other kind of manufacturer. 
 
 "Is it any wonder that agriculture decays in countries where the 
 farmers are expected to buy at retail prices and sell at wholesale 
 prices? You must not, to save any row, sell the rights of farmers." 
 
 Let us repeat, then, that we believe farmers should always 
 do co-operative buying — but not always co-operative merchan- 
 dising. We believe in co-operative buying, because farmers 
 are entitled to manufacturers' prices, as Mr. Russell em-
 
 CO-OPERATIVE BUYING IS GOOD 41 
 
 phasizes; and because they are entitled to buy any kind of 
 merchandise together and save the extra expense and labor 
 and bookkeeping that manufacturers and dealers would incur 
 in making separate sales of such merchandise to all these in- 
 dividual farmers. Farmers are also entitled to buy from city 
 stores at lower prices than these stores charge city customers 
 for whom expensive deliveries must be made. As Mr. C. W. 
 Hillhouse of Sylvester, Ga., said in a letter to the writer 
 recently : 
 
 "Take our little town. There are perhaps a half dozen of our mer- 
 chants who cater to the city trade and run delivery wagons, so they 
 have the expense of six men to drive, up-keep of six drays, expense 
 and feed of six horses, when perhaps through co-operation of these six 
 merchants, one dray, one horse and one man could do the work. One 
 lady away out in the residence section, say a mile distant, will 'phone 
 one merchant for a peck of meal, another for a sifter, another for a 
 quart of vinegar. So away go three drays to make these deliveries, 
 where by co-operation one could do it easily." 
 
 This is one explanation of the ever-increasing "high cost of 
 living." Of course, the cost of all this expensive delivery 
 service must be added to the prices of the merchandise sold — 
 there is no other way on earth to pay it — ^and when a town 
 store charges both townspeople and farmers the same cost- 
 plus-delivery prices, the farmers are simply paying part of the 
 cost of this exorbitantly expensive system of free delivery for 
 townspeople. Now if merchants will not co-operate and at 
 least reduce this expense to a minimum, they need not be sur- 
 prised if consumers, especially country consumers, decide to do 
 more and more co-operating on their own account. As Prof. 
 L. H. Goddard has said in a circular of the Rural Organiza- 
 tion Service, United States Department of Agriculture : 
 
 "It is probable that very few people realize the unfairness of any 
 store charging farmers the same price for supplies as they charge city 
 people, even though the goods may be sold to the farmers on the credit 
 basis, which perhaps is less often than in the case of city people. The 
 cost of delivering an order of goods from the store to the home of the 
 town consumer will vary from perhaps as low as three cents to at
 
 42 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 least as much as 10 cents per order, depending upon the size of the 
 town and the kind of delivery. By a combination of their delivery 
 business so that one set of wagons delivered for 11 stores in a city of 
 6,000 inhabitants, these stores were able to have seven wagons do the 
 work that had been requiring 17 wagons, and do it even better than it 
 had been done previously. After effecting this combination the cost 
 of delivery per order was cut to about 3^ cents. In a city of 21,000 
 inhabitants, in which a store kept account of cost of delivery and 
 charged it up to each consumer in accordance with the number of de- 
 liveries required, as it really should be in all cases, the cost was from 
 9 to 10 cents per order. In the first mentioned town there are resi- 
 dents who rarely ever fail to have something on every one of the four 
 daily trips which the stores have been able to maintain on the im- 
 portant streets of the town, since establishing their combination de- 
 livery. 
 
 "A moment's calculation will show that at the low cost of 3^ 
 cents per order, which probably is not more than half the average of all 
 stores, it costs $40 or more per year to deliver goods to such a family 
 as the ones mentioned, whereas another family that has two deliveries 
 per week would occasion a delivery expense about one-tenth as great. 
 Where goods are delivered, the delivery charge alone is said to cost 
 town stores from 5 to 20 per cent of the cost of goods sold, depending 
 on size of town and character of goods." 
 
 This delivery cost of purchased articles, it must be re- 
 membered, is always one of the chief items of expense in 
 piecemeal buying, and it is expensive whether the farmer 
 or the merchant does the work of delivering. When a 
 man and a horse are taken from farm work half a day (as 
 not infrequently happens) to get a few pounds of meat, a 
 pound of coffee, two plow-points, and a few pounds of 
 nails, the delivery cost may be not merely "from 5 to 20 
 per cent," as in the city, but may even reach 25 or 50 per 
 cent. Farmers ought to consider, therefore, that in buy- 
 ing in piddling quantities, they not only pay higher prices, 
 but the delivery cost is greatly increased or even multiplied. 
 As Mr. E. M. Stickney, a Demopolis, Ala., farmer said 
 recently : 
 
 "Is it best for a man to buy what he needs periodically, say once a 
 'month, from a wholesale dealer and save the worry and distraction of
 
 CO-OPERATIVE BUYING IS GOOD 43 
 
 ; frequent and irregular trips to town, and at the same time save the 
 
 I retail man's profit, or is it best to buy what you need just any time you 
 ), happen to think of it, by piecemeal in a hand-to-mouth way, and pay 
 :! from 10 to 20 per cent more than you should? Of course, all will agree 
 
 II that the former method is the best. I know, however, of several fam- 
 I ilies in this locality who buy supplies as though they were next door 
 
 to a grocery store. 
 
 "Now tell me, what do farmers, living six miles from any base of 
 supplies, look like buying just enough for two or three days or even 
 a week? They are tearing up the organization of their working force 
 by trips to town, and at the same time losing money by buying in small 
 quantities. All this could be avoided by well-planned purchases, once 
 a month at a wholesale price, and a little trouble in caring for the 
 groceries after they are bought." 
 
 Before farmers decide to start new stores of their own in 
 little villages, therefore, it will be well to inquire if it will 
 i not be a better form of co-operation to make up monthly 
 \ orders for the main supplies needed, and place these bulk 
 f orders in whatever way will save the most money. Fre- 
 quently the local merchant will handle them on a small 
 commission. 
 
 Ninety-nine times out a hundred, too, it will pay rep- 
 utable farmers to borrow money from some bank or honest 
 money-lender (preferably a bank) at 6 or 8 per cent in- 
 terest per year instead of paying at the rate of lo ta 
 40 per cent a year in the form of "time prices." Only 
 a few months ago the writer sent out a batch of inquiries 
 to several hundred farmers in the South Atlantic and South 
 Central States, including the following questions : 
 
 "About how much more do merchants charge for time prices than 
 for cash prices in your community? What per cent extra for six 
 months time?" 
 
 Taking fifty replies, without selection, just exactly as we 
 come to them, we find farmers' replies as follows : 
 
 Per cent extra charged for six months' time prices : 8-15- 
 5-30 to 100-40-5-20-20-25- 10-8-25 to 40-40-40-10-25 to 50-50- 
 20-25 to 50-35-10 to 25-10 to 20-10-15-15 to 25-10 to 50-25 to
 
 44 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 40-47-" 2 for I "-8- 10 to 5o-io-i5-33i^-"They charge from 25 
 per cent to grand larceny"-io to 20-10-4-5-10-15-4-16-20-10- 
 20 to 25-10-20-50-25-10 to 25. ! 
 
 On the writer's own market last spring and summer corn * 
 sold for 85 cents a bushel cash and $1.05 on time, due \ 
 October i. Farmers who bought April i thus paid an interest ' 
 rate of 47 per cent a year; farmers who bought July I \ 
 paid at the rate of 94 per cent a year, j 
 
 From these figures it seems safe to assume that on time j 
 prices for ordinary supplies the average charge is I2i/^ to i 
 20 per cent for six months' time, or at the rate of 25 to 40 j 
 per cent interest per annum. The same increase is charged '\ 
 on many purchases paid within three months' time, making ! 
 the interest rate in such cases equal 50 to 80 per cent per 1 
 year. And with such evidence it should certainly not be ' 
 necessary to ask whether it will pay to borrow money at , 
 6 to 8 per cent per year and save from 10 to 40 per cent 
 thereby. \ 
 
 Instead of paying "time prices" we should certainly ad- ' 
 vise any honest farmer to go to some banker or man of i 
 wealth and borrow money at a reasonable rate of interest, j 
 put it in a bank, and check on it as needed to pay cash for 
 whatever he needs. 
 
 Understand us, we do not favor putting all the blame on : 
 the merchants. They have to stand so many losses from ] 
 dishonest and shiftless persons that they must make time 1 
 prices exorbitant; so exorbitant that an honest man can't < 
 afford to pay them — certainly not until he has tried his | 
 local banks and exhausted all other efforts to get money ' 
 at a reasonable rate of interest. j 
 
 The fact is that whenever you get goods on credit and j 
 later pay for them as an honest man, you must always pay i 
 for the goods the dishonest man bought on credit and ' 
 didn't pay for. This is the meaning of "time prices" — ; 
 this together with the fact that the merchant must always i 
 add on still another percentage to cover risks. For ex- ; 
 
 i
 
 CO-OPERATIVE BUYING IS GOOD 45 
 
 ample, when I lent a cousin on my old homestead farm 
 last year the money to pay for his fertilizer in May, the 
 interest I charged him for the six months was only 3 per 
 cent, while the merchant's discount for cash was 20 per 
 cent — a saving to my cousin of 17 per cent. But this didn't 
 mean that the merchant was charging 17 per cent extra 
 hiterest for six months. Rather, the 17 per cent interest 
 represented (i) average losses from other farmers and 
 tenants who might not pay for the fertilizer at all, plus (2) 
 a very handsome margin of insurance against the utmost 
 possible loss the merchant might sustain — all to be paid 
 by honest buyers. 
 
 Here, then, is the chance for co-operation in buying. 
 Farmers whenever possible must arrange to pay cash for 
 their supplies, and those who have cash or can obtain it 
 will find it profitable to club their orders together once or 
 twice a month. Then if patronage develops and patrons 
 show such "sticking qualities" that it is evident that the 
 day for bigger things has come, it will be time enough to 
 consider opening a warehouse say one or two days a week 
 for the convenience of other farmers and thus making a 
 more serious start into co-operative merchandising. 
 
 As Prof. Goddard says in the circular from which we 
 hare just quoted : 
 
 "In communities in which farmers cannot secure from dealers the 
 proper reduction in the cost of suppHes, even when they are willing to 
 limit the service to the economic minimum and to buy for cash, or 
 where the service afforded does not rise to the level of the economic 
 minimum, there are a number of courses open to them : 
 
 "1. A simple plan is for a number of individuals, with a common 
 shipping point, to join in sending an order to some available supply 
 house. 
 
 "2. With further experience and information such a group of farm- 
 ers may usually get a better reduction on carload cash orders of such 
 articles as seed, feed, twine, machinery, fuel, salt, flour, sugar, cement, 
 building material, fencing, fertilizer, etc., because of being able to order 
 in many cases directly from the factory or producer, or from a source 
 of supply very close to the producer.
 
 46 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 "3. If desired this group of farmers may make available some 
 building at or near the local shipping point which would serve as a 
 warehouse for storing supplies in case the car arrives when the people 
 are very busy, or the roads very bad, or in case part of the carload 
 would not be needed until later in the year. 
 
 "4. In some cases where these warehouses have been established it 
 has been found necessary to appoint some one to keep them open on 
 stated days, afternoons, or evenings of each week or month. In a few 
 cases, at least, these warehouses have gradually grown into stores 
 which were kept open most or all the days of the week. 
 
 "5. Still another plan is to establish a farmers' mercantile corpora- 
 tion or a farmers' co-operative store — raising the capital for same in 
 the usual way, by selling shares." 
 
 Some further good counsel as to how to conduct the ware- 
 house of the purchasing society is given by Prof. Goddard 
 in the following paragraphs : 
 
 "If it seems wise to establish a warehouse, as mentioned in item 3, 
 it must be borne in mind that one of the primary purposes of the ware- 
 house is to promote economy, and, therefore, that proper economy is 
 necessary to every state of the work. For example, it will usually be 
 possible to secure for warehouse purposes, at a moderate rental, some 
 old building that will be good enough to protect its contents from 
 storm and intruders. The higher the rent the more it will be necessary 
 to add to the price of goods that are stored. By all means avoid 
 raising money to buy a building for this purpose until the business is 
 well estabUshed and it is badly needed." 
 
 "If the practice develops of shipping in material to supply future 
 needs, it may be necessary to open the warehouse more frequently, for 
 example, Saturday afternoons and several evenings each week, and 
 with the further development of business of this character the build- 
 ing will need to be opened still more frequently and continuously. 
 Just when the warehouse will arise to the dignity of being called a 
 'store' will be hard to determine. It might perhaps better continue to 
 be called a warehouse, no matter how much business of that character 
 it does, since most people have come to associate the much more 
 elaborate and unnecessary service with the name 'store,' and by retain- 
 ing the name 'warehouse' the organizers and those who later become 
 interested will continue to keep in mind that one of the purposes for 
 which the movement was started was to cut down service and corre- 
 sponding expense." 
 
 In other words, Prof. Goddard's conclusion, like our own,
 
 CO-OPER^\TIVE BUYING IS GOOD 47 
 
 seems to be that farmers may be sure they ought to do co- 
 operative buying, but ought not to feel so sure that they 
 ought to do co-operative merchandising. And where the 
 co-operative store succeeds it is usually when the people 
 "grow" into it rather than "go" into it. Begin at least with 
 co-operative buying.
 
 CHAPTER IV 
 
 RURAL CREDITS AND CO-OPERATION 
 
 Not All European Ideas Are Adaptable Here, hut Some of 
 Them Are — "Amortization" Explained and Illustrated— 
 Every State Should Adopt the Torrens System of Register- 
 ing Land Titles — We Must Make It Easy to Save Money as 
 Well as Borrow It. 
 
 ADAM SMITH observed in his "Wealth of Nations," 
 written in 1776, that "since the downfall of the 
 Roman Empire the policy of all the great European 
 nations has been more favorable to manufacturing, 
 the industry of the towns, than to agriculture, the industry 
 of the country." 
 
 If the celebrated English economist were still living he 
 might truthfully make the same observation as being good 
 to this day, and he might include America along with the 
 European countries in his statement. And he might fur- 
 ther cite the banking system of the United States these last 
 hundred years as a fine illustration of how the government 
 as a rule has calmly formed its statutes for the benefit of 
 the city man, placidly assuming that the tillers of the soil 
 have no rights that urban interests and lawmakers are 
 bound to respect. Until the new currency legislation of 
 1913, for example. National banks might not lend money 
 on land at all, and if the farmer managed to present other 
 satisfactory security, he could get money only for three or 
 four months at the time, whereas in farming one usually 
 needs money for a longer period or not at all. 
 
 In recent years, however, a number of European coun- 
 tries have worked out more or less satisfactory rural credit
 
 RURAL CREDITS AND CO-OPERATION 49 
 
 systems, and while some European plans (such as the un- 
 limited liability of members in Raiffeisen banks) would 
 not be popular in this country, there are certain European 
 methods our American farmers should take advantage of. 
 
 One of these is the amortization plan of farm loans, such 
 as the writer found in operation in Ireland and on the Con- 
 tinent, whereby a man may buy a farm and pay for it in 
 small annual or semi-annual installments running through 
 10, 20, 40 or even 60 years, each installment amounting to 
 little more than legal interest, but gradually reducing the 
 principal until all is paid. It's the building and loan idea 
 of "Buying Your Home With Rent Money." Thus, in Ire- 
 land we found land which had been sold to the farmers, the 
 government advancing the money on payments running 
 68 years, the buyer to pay 3^ per cent a year, 2^ per cent 
 counting as interest and J^ per cent a year going to pay off 
 the debt. (Of course, 2^ per cent interest is ridiculously 
 low, and probably no government for a hundred years will 
 ever oflfer so low a rate again.) \n New Zealand a man can 
 pay for land by paying 5 per cent a year interest and 3 per 
 cent a year on the principal for twenty years. 
 
 Amortization, of course, is simply the principle of com- 
 pound interest in reverse action — working for the benefit 
 of the borrower instead of for the benefit of the lender. 
 For example, interest on $100 at 6 per cent is $6 a year. 
 But if you agree to pay $9 a year (which is equal to 9 per 
 cent a year on the original $100 principal) you would at 
 the end of the first year reduce the principal to $97, so that 
 the interest the second year would be on only $97 instead 
 of $100 — or $5.82 interest instead of $6 interest. In other 
 words, the second year you would have $3.18 left to apply 
 on the principal, reducing the balance due to $93.82 — and 
 so on. Each year the principal would become smaller 
 and the interest correspondingly smaller and the payment 
 on the principal correspondingly greater, until the debt 
 would be cleared up.
 
 50 
 
 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 In order to make the idea perfectly clear, we submit here- 
 ■with a table we have worked out showing just how with 
 money at 6 per cent you could borrow money under this 
 plan and by paying 9 per cent a year on the original amount 
 pay off the whole debt, whatever it was, in 19 years. Let 
 us take a $100 loan as a basis. If you wish to see how it 
 would work with a $500 loan, simply multiply each figure 
 in the table by 5, or for a $1,000 loan, multiply by 10, and 
 so on. 
 
 Paying Off a $100 Loan by Paying $9 a Year, Interest at 6 Per Cent 
 
 Tear 
 
 Interest 
 due for 
 the year 
 
 Rest of $9 
 
 Pay't left for 
 
 principal 
 
 Total pay't 
 
 on principal 
 
 to date 
 
 Balance 
 
 due on 
 
 principal 
 
 1st 
 
 2d - 
 
 $6.00 
 5.82 
 5.63 
 5.43 
 5.21 
 4.98 
 4.74 
 4.49 
 4.22 
 3.93 
 3.63 
 3.30 
 2.96 
 2.60 
 2.22 
 1.81 
 1.38 
 .92 
 .44 
 
 $3.00 
 3.18 
 3.37 
 3.57 
 3.79 
 4.02 
 4.26 
 4.51 
 4.78 
 6.07 
 6.37 
 6.70 
 6.04 
 6.40 
 6.78 
 7.19 
 7.62 
 8.08 
 7.27 
 
 $3.00 
 6.18 
 9.55 
 13.12 
 16.91 
 20.93 
 25.19 
 29.70 
 34.48 
 39.55 
 44.92 
 50.62 
 56.66 
 63.06 
 69.84 
 77.03 
 84.65 
 92.73 
 100.00 
 
 $97.00 
 93 82 
 
 3d 
 
 90.45 
 86.88 
 83.09 
 79.07 
 74.81 
 70.30 
 65.52 
 60.45 
 55.08 
 49.38 
 43.34 
 36.94 
 30.16 
 22.97 
 15.35 
 7.27 
 None 
 
 4th 
 
 5th 
 
 6th 
 
 7th 
 
 8th 
 
 9th 
 
 10th 
 
 11th 
 
 12th 
 
 13th 
 
 14th 
 
 15th 
 
 16th 
 
 17th 
 
 18th 
 
 19th 
 
 Most amortization plans also provide that the borrower 
 may make heavier payments at any time or pay off the 
 entire principal and save all future interest. 
 
 It is easy to see how such a plan would stimulate thrift, 
 industry and enterprise. Thousands of people unable to 
 buy land under present conditions would purchase under
 
 RURAL CREDITS AND CO-OPERATION 51 
 
 such an amortization payment plan as we have mentioned; 
 thousands who are unable to tile-drain their lands, or drain, 
 swamps, or build silos, or build worthy homes, would enter 
 the door of hope thus opened to them. 
 
 Of course, we can hear some people say that many would 
 borrow foolishly. That is undoubtedly true,'but it does not 
 seem likely that very many more would borrow foolishly than 
 now, when we recall the thousands of poor people who are 
 slaves to the credit system and to loan sharks. And if a 
 man borrows unwisely under this plan, there would be hope 
 for him and his family to escape the burden of debt in time, 
 whereas under the present mortgage system, foreclosure 
 continually stares them in the face. 
 
 II 
 
 If our farmers are ever to borrow money profitably on. 
 land security, however, they must have everywhere a better 
 system of registering land titles — something like the now 
 famous Torrens system. In Germany, for example, the 
 writer was told over and over again that no satisfactory 
 rural credits plan would ever have been evolved but for 
 action of this kind. 
 
 Now, the difference between ordinary methods of land 
 transfer in America and the Torrens system may be ex- 
 plained very briefly. 
 
 Under our present antiquated system, every time a piece 
 of real estate changes hands, some lawyer must examine 
 into the legality of the title. Old records, running back 
 sometimes for hundreds of years, must be searched at great 
 labor and expense ; and the next time the property is sold, 
 and the next, and the next, the same identical work must 
 be done over again, and other big lawyers' fees paid — 2i 
 system as foolish and uneconomical as paying a man to 
 carry a brick from one side of the street to the other and 
 back again and again interminably.
 
 52 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 Now the Torrens system proposes that instead of this 
 perennial investigation of the same thing, this unending, 
 Sisyphus-Hke job of rolHng the stone uphill and then letting 
 it roll straightway down again, and all to no purpose save 
 the paying of unnecessary fees to lawyers who might better 
 serve their fellows in some other way — instead of all this, 
 we say, the Torrens system proposes that the State shall 
 examine the title once for all, guarantee it, and register it, so 
 that forever afterward it may be transferred almost as easily, 
 quickly and cheaply as a government bond or a share of stock 
 in an incorporated company. The original cost of a Torrens 
 deed, even including the little tax for the guarantee fund, 
 would hardly exceed the present cost of two title investi- 
 gations; and ever after the farmer would be able to transfer 
 his property or secure loans upon it, at from one-fourth to 
 one-twentieth the present cost. 
 
 The Torrens system is now in force in several states with 
 good results. The writer has personally investigated its 
 satisfactory operation in Massachusetts, Minnesota, Illinois, 
 North Carolina, the Philippines and Hawaii. 
 
 As for the technical side of the matter, the special pro- 
 cedure necessary in a Torrens title case has been very 
 clearly summarized by one authority as follows : 
 
 "The owner of real estate makes known to the clerk of the court of 
 the county or city in which the real estate is located his desire to have 
 the title of the land certified and registered. Whereupon the clerk 
 issues a summons, running in the name of the State, to all persons 
 who may be interested in the real estate to come forward and protect 
 their rights and interests therein, if any they can show. 
 
 "After their summons has run due length of time, the examiner of 
 titles for the district in which the land is situate, a duly appointed pub- 
 lic official, takes the petition, goes to the records and makes careful and 
 exhaustive investigation. Upon completion of the investigation, he 
 makes report to the judge. Whereupon the judge sets a day for hear- 
 ing and all parties claiming an interest in the title under investigation 
 are notified to appear in court and set forth the nature and extent of 
 their claims. 
 
 "The title having been established to the satisfaction of the court, 
 a decree is handed down certifying that the petitioner has title in fee
 
 RURAL CREDITS AND CO-OPERATION 53 
 
 in the land in question, the boundaries of which are registered, and an 
 order is entered directing the clerk to make an entry of the title upon 
 a book set apart for the purpose, as a registered title secured by the 
 guarantee of the State. 
 
 "Thereafter for all time the certificate of registration stands as a 
 guarantee of the soundness of the title no matter how often the land 
 may change hands or how much it may be sub-divided : no further ex- 
 amination of the title, with the always greater or less expense attach- 
 ing thereto, is ever required." 
 
 Ill 
 
 It must never be forgotten, however, that enabling land- 
 owning farmers to borrow money on their real estate solves 
 only one form of the rural credits disease. There are three 
 other highly important phases of the problem, as follows: 
 
 1. Provision must be made for lending money for short time on 
 personal credits. 
 
 2. Provision must be made for helping worthy tenants or settlers 
 buy land. 
 
 3. Provision must be made for encouraging and accumulating farm- 
 ers' savings to be lent out to other farmers. 
 
 In most sections of the country probably the best thing 
 a modern system of rural credits could do for us would be 
 to provide a means of escape from the supply merchant's 
 ruinous "time prices." For the fact is that as a general 
 rule it has not been the paying of 6 or 8 per cent interest 
 on debts that has caused farmers to lose their homes, but 
 paying from lo to 40 per cent as extra charge for "time 
 prices" on supplies. 
 
 Mr. J. Z. Green, one of the best known Farmers' Union 
 organizers in the South, points out how our farmers furnish 
 rope to hang themselves with. Here is the process as he 
 gives it: 
 
 "It is a well-known fact that a large per cent of our farmers do not 
 know what to do with surplus money when they happen to get a little 
 ahead. So they deposit it in the banks at 4 per cent. The banks in
 
 54 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 turn lend it to the time merchants, and the time merchants, being law- 
 abiding citizens, refuse to lend it to less fortunate farmers in violation 
 of the 6-per-cent-interest law, but invest it in groceries and then lend 
 the groceries to the needy customer at the moderate rate of from 30 to 
 50 per cent interest. Beautiful system, isn't it?— for the time merchant. 
 Under this 'system' the few farmers who, by denying their families of 
 many comforts, and conveniences of life, manage to acquire a little 
 cash surplus, immediately turn it over to the time merchant to capital- 
 ize his private money-making business." 
 
 The remedy, of course, is for farmers to stop getting 4 
 per cent to the hurt of their neighbors, and begin getting 
 6 per cent to the help of their neighbors. Without adopting 
 the "unHmited Hability" feature of the Raiffeisen system of 
 Europe, farmers can form co-operative societies along very 
 simple lines, as for example : 
 
 1. Ten or more farmers can take stock with shares at $25 
 each — totaling say $500 or $1,000 or $2,000 in all. 
 
 2. Let the money be lent to members at legal interest 
 rates for productive purposes only — the judicious pur- 
 chases of live stock, fertilizers, or machinery, for example, or 
 some other useful purpose. 
 
 3. Require the borrower to give security worth twice the 
 loan, or to be indorsed by two members with satisfactory 
 property — or both. 
 
 4. Limit the amount that can be lent to any one farmer 
 to $50, $100 or $200, as may seem best. 
 
 Or, perhaps the credit union may take the form of a rural 
 building and loan association or "land and loan associa- 
 tion." In any case, the rural credit organization must not 
 ignore the fact that the rural credits problem is not wholly a 
 matter of helping the farmer get money. Helping him save 
 money is another big matter. Habits of thrift and economy 
 must be encouraged, as Mr. Bradford Knapp is always and 
 wisely urging. Consider, for example, the Raiffeisen banks 
 in Europe — the little credit societies in which farmers have 
 deposited $10, $25, $50 or $100 each to be re-lent to mem- 
 bers: they have probably helped the farmer as much by
 
 RURAL CREDITS AND CO-OPERATION 55 
 
 \ giving him a start toward financial independence through 
 i saving as in delivering him from "time prices" bondage by 
 I lending to him. 
 
 Whatever is done with regard to loans on land, therefore, we 
 ' must work out some system for encouraging and pooling 
 
 the farmers' savings and using these savings to build up 
 
 farm life.
 
 CHAPTER V 
 
 WHY I BELIEVE IN THE FARMERS' UNION, 
 
 GRANGE, ETC. 
 
 ^'Dangers" in Farmers' Organizations — But in No Other Way 
 Can We Develop New Rural Civilisation — Unions Favor 
 Both Scientific Farming and Scientific Marketing — The 
 Grange and Society of Equity Approved 
 
 YOU ought not to have anything to do with the 
 Farmers' Union," said a prudent, far-seeing busi- 
 ness friend to me some time ago. "The Union will 
 get mixed up with politics or will go after some 
 impracticable schemes or will die out like the alliance." 
 
 For once I confess I felt a little vexed with my friend; 
 and my answer ran something like this: 'T don't know 
 whether it is prudent financially or not. Quite likely it 
 is not. I know that the farmers are not used to work- 
 ing together. I know that they are likely to be misled at 
 times. I know they may sometimes have their prejudices 
 aroused and turn down their truest friends at the behest of 
 some demagogue. I know, too, that being untried in busi- 
 ness, they may want to go off into some big, alluring, high- 
 sounding scheme that will not work, instead of devoting 
 themselves to neighborhood co-operative enterprises and 
 building up from them. 
 
 "I know all this," I continued, "and I know if my aim were 
 simply to make money we might well let the Farmers' Union 
 go ; or simply say that it is a good thing, and all farmers ought 
 to join, etc. But I cannot be content with any such attitude. I 
 am fighting not merely for better farmers and better farm- 
 ing methods, but for a new rural civilization. It is not 
 enough to help our farmers make more money; they must 
 
 66
 
 WHY I BELIEVE IN THE FARMERS* UNION, GRANGE, ETC. 57 
 
 be helped to a new economic and social life. And to ac- 
 complish this result there must be organization. The 
 farmers must meet and work together, I don't doubt but 
 that they will make many mistakes. We all do. But as I 
 see it, it is the duty of every farmer and every man who 
 is patriotic, eligible and who loves our farmer folk to join 
 the strongest farmers' organization in his section and help 
 keep it from making mistakes instead of standing aside, 
 predicting disaster, and waiting for a chance to say, 'I told 
 you so !' " 
 
 The writer speaks with such enthusiasm of the Farmers* 
 Union because it is the strongest farmers' organization 
 in the South and Northwest. Readers in the New Eng- 
 land or Middle States may accomplish as much through 
 their local granges or societies or equity. But in any case 
 we see many advantages in having a local farmers' club 
 linked up with some general organization. You will ac- 
 complish more and your influence will extend farther. If 
 you get benefits by combining individual farmers in a club, 
 will you not get even greater benefits from combining in- 
 dividual clubs into a general federation? 
 
 What we ought to aim at all over America is the de- 
 velopment of a great rural civilization such as Sir Horace 
 Plunkett has wrought out in Ireland, and such as others 
 have wrought out in Denmark, and I see no way to work 
 out such a great rural civilization, no way to have such a 
 development of rural education and rural co-operation, 
 except through the organization of the farmers. "How 
 shall they hear without a preacher?" There are ten thou- 
 sand co-operative enterprises that should be established, 
 but the first thing to do is to get the people together to 
 discuss their advantages ; if we can get the people to meet- 
 ing regularly together in every school district to discuss 
 co-operation and how to co-operate, the co-operation itself
 
 58 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 will surely follow — co-operation that would take a genera- 
 tion longer to get if we were without a missionary organ- 
 ization to start with. 
 
 And we are fortunate in that the Union has learned the 
 lesson taught by the experience of other farmers' organ- 
 izations. It has learned the great folly of depending upon 
 political or governmental help instead of self-help as the 
 way out. 
 
 Education and Co-operation — these are our two great 
 needs ! This must be our motto and our shibboleth. The 
 longer I live the more I honor the memory of old Newt 
 ■Gresham and those other plain, simple farmers who formed 
 the first Farmers' Educational and Co-operative Union 
 away out on the Texas plains and wrote its Declaration of 
 Purposes! At times it would seem as if they acted by 
 direct inspiration. The Farmers' "Educational and Co- 
 operative" Union, they called it — called it so to forever 
 emphasize the idea that education and co-operation, these 
 two things and these two only, should be the supreme aim 
 of the organization. And at every local Union meeting 
 and at every county Union meeting, it seems to me, the 
 one big pre-eminent question should be, "What can we do 
 in the line of education and co-operation? For this is what 
 we are here for — for education and co-operation and noth- 
 ing else." 
 
 "The greatest result of agricultural co-operation in Ire- 
 land," as Sir Horace Plunkett once said to me, "is not the 
 profits we have made, but the fact that we have made 
 business men of farmers." They have worked out a new 
 civilization — have learned to believe in themselves and in 
 their neighbors, have learned to do team work, have gotten 
 the power and profits of united effort ; and their co-opera- 
 tion in business is making them capable of doing anything 
 and meeting any situation that may arise. 
 
 And the great secret is that Irish co-operation has begun 
 at home — as it must always begin at home to be perma-
 
 WHY I BELIEVE IN THE FARMERS' UNION, GRANGE, ETC. 59 
 
 nently successful. The place to begin co-operation is with 
 your next-door neighbor. Mr. J. R. Rives told me the 
 other day of two neighbors near him who had a horse 
 apiece and had been making twenty bushels of corn per 
 acre with hard work and one-horse tools. Last year they 
 joined together, bought a disk plow and disk harrow, and 
 plowed and harrowed and cultivated as never before, and 
 made forty bushels of corn per acre. That's a sample of 
 the sort of co-operation millions of our farmers need to do, 
 co-operation which begins at home and helps the members 
 of one's own local. 
 
 This is the view taken by the North Carolina Farmers* 
 Union, the strongest State Union in America, in a notable 
 new step which we believe other organizations in other 
 states will do well to emulate. Nearly $500 in prizes has 
 been offered to locals that make themselves leaders in 
 community betterment, as follows : 
 
 No. 1 — To locals making best report of work done by them for de- 
 velopment of community spirit through social entertainments, educa- 
 tional rallies, and all enterprises calling for brotherhood and the "get- 
 together" spirit, a first prize of $50, a second prize of $25, and two 
 prizes of $10 each. 
 
 No 2 — To locals reporting best system of co-operative marketing 
 of products raised by its members, a first prize of $50, a second prize 
 of $25, and two prizes of $10 each. 
 
 No. 3 — To locals making best report of a survey of educational, 
 agricultural, religious, economic and social conditions of the com- 
 munity, a first prize of $25 and three prizes of $10 each. 
 
 No. 4 — To locals making best report of work in co-operative pur- 
 chase and ownership of pure-bred live stock, a first prize of $25, and 
 three prizes of $10 each. 
 
 No. 5 — To locals making best report in co-operative ownership of 
 implements and machinery, a first prize of $25, and three prizes of $10 
 each. 
 
 No. 6 — To locals making best report of work in developing the read- 
 ing habit among the people of the community, through libraries, books, 
 papers and education of adult illiterates, a first prize of $25, and three 
 prizes of $10 each. 
 
 No. 7 — To locals making best report of work in increasing member- 
 ship, increasing interest in the meetings, and the general usefulness of
 
 60 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 the local to its members, a first prize of $25, and three prizes of $10 
 each. 
 
 A special certificate of honor will be given to the local 
 in each county that makes the best report in any particular, 
 whether it wins a prize or not. 
 
 II 
 
 Another thing I like about those wise men out in Texas 
 who formed the Farmers' Union : they were not little, nar- 
 row, one-idea men, but laid a broad and sound foundation 
 for it and said once and forever in its "Declaration of Pur- 
 poses" that the aim of the Union is both to help farmers in 
 marketing, buying and selling, and also "to educate the 
 farming classes in scientific farming," "to discourage the 
 credit and mortgage system," and "to bring farming up to 
 the standard of other industries and business enterprises." 
 
 No man is a good Union man, therefore, who says there 
 is no need of "educating the farming classes in scientific 
 farming," just as no man is a good Union man who says 
 there is no need of educating them in scientific marketing. 
 The Union rightly says we must have both. We have been 
 poor despite our hard work, both because we have lacked 
 "education in scientific farming," and also the advantages of 
 co-operation and marketing. 
 
 Consider this fact, for example — that our farmers in the 
 South have lived under the same general government, the 
 same general marketing and economic conditions, as the 
 farmers in the North and West. And yet the census 
 figures prove that chiefly because of the better farming 
 methods in the North the average North Atlantic States 
 farmer earned in 1900 $984, while our average South At- 
 lantic States farmer earned only $484 — $500 a year less 
 than his more scientific northern brother; and at the same 
 time the average North Central States farmer earned $1,074, 
 while our average Southern Central States farmer earned
 
 WHY I BELIEVE IN THE FARMERS* UNION, GRANGE, ETC. 61 
 
 only $536 — $538 a year less than the more scientific north- 
 ern farmer. 
 
 On the whole, I insist that the average southern farmer 
 can make $500 more a year by better farming methods and 
 $500 more a year by better methods of co-operation and 
 marketing — and what I want us to do is to get both $500 
 gains. An extra $1,000 a year per farm is what we must 
 have to build up a great rural civilization in the South. 
 
 And instead of the man who is trying to get the extra 
 $500 by co-operation and marketing throwing stones at the 
 man who is trying to get the extra $500 by better farming, 
 let them work together. That's what the Farmers' Union 
 says, and it is the policy all farmers should fight for. 
 
 To make my meaning clearer, let me give another illus- 
 tration. Cotton manufacturing is like farming, in that in 
 both industries there are continual improvements in 
 methods, in machinery, and in marketing. Now suppose 
 a southern cotton manufacturer were losing money and 
 should join with his brother manufacturers to market his 
 goods co-operatively. That would mean more profit, no 
 doubt, and would be a wise move, just as it is a wise move 
 for our farmers. But suppose this same manufacturer kept 
 on using out-of-date machinery, unscientific methods, an 
 uneconomical system of production, while northern manu- 
 facturers kept on improving their methods, using better 
 implements and machinery, etc., etc. And suppose his 
 manufacturing paper kept on telling this southern manu- 
 facturer of improved scientific methods of production, of 
 labor-saving implements and machinery that other manu- 
 facturers were using, and kept saying to him, "We must 
 use as good methods as northern and western manufac- 
 turers use or we will be put out of business." But suppose 
 he should then say, 'T am going to stop reading that paper. 
 I am tired of so much teaching about better methods of 
 manufacturing. All I want is a new marketing plan. I 
 can use the same sort of manufacturing methods my grand-
 
 62 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 father used." The best system of marketing on earth 
 wouldn't save that manufacturer from bankruptcy, poverty 
 and ruin. 
 
 It's the same way with our southern farmers. They 
 may adopt the best marketing system on earth, but they 
 must also do better farming or lose out in competition with 
 other sections. And American farmers must adopt the 
 best methods or lose out in competition with the educated, 
 alert farmers of foreign countries. We sometimes seem to 
 fall into the foolish notion that farmers in our immediate 
 section are the only ones there are on earth. The truth is, 
 that the locomotive and the steamship make us competi- 
 tors with farmers all over the world. A man can get plenty 
 of labor in India to work cotton at lo to 15 cents a day, 
 and our southern cotton must compete with Indian cotton. 
 In food and feed crops, we must compete with the wide- 
 awake farmers in Europe and Canada. In growing cattle, 
 we must compete with farmers in South America — and it 
 is said that next year South America will even send corn to 
 the United States. 
 
 Moreover, we in the South also have to consider another 
 big fact that cannot be too strongly emphasized. This is 
 that we can never, never market cotton or tobacco effec- 
 tively until we get better farming, so farmers can grow 
 their own corn and feed and so escape the mortgage and 
 credit system. For it is an admitted fact that the system 
 of buying supplies now throws our staple crops pell-mell 
 on every autumn market, and ruins every attempt at regu- 
 lated, systematical, scientific selling of these crops. 
 
 Better farming, therefore, will help us get better mar- 
 keting, and both plans must go along together, as the 
 Farmers' Union founders so wisely foresaw.
 
 CHAPTER VI 
 
 SOME FARMERS' CLUBS I HAVE KNOWN, AND 
 
 THEIR WORK 
 
 First, Co-operative Ownership of Threshers, Manure Spread- 
 ers, Mowers, Stalk Cutters, etc. — Co-operation in Marketing 
 Cotton Seed — A Clover Huller Success — A Club That Owns 
 a Registered Bull — Last and Best of All, Co-operative 
 Produce Marketing 
 
 LET me give a few examples of what some farmers'' 
 clubs I know are doing. To begin with, here is a 
 ^ letter from the secretary of a local farmers' union 
 in a neighborhood I visited recently, which shows 
 exactly what ten thousand farmers' clubs and ten thousand 
 rural neighborhoods all over the country ought to be doing 
 all the time. This is what the secretary wrote me : 
 
 "Broadway Union, No. 1089, has twenty-three members, and we 
 have been doing things this year. We have bought for cash $1,850 
 worth of fertiUzers, a threshing outfit at a cost of $750, lime and fer- 
 tilizer distributor, and have bought together what grain we had to buy. 
 
 "We have a progressive neighborhood and our people believe in 
 co-operation. For instance, two of our members own a manure 
 spreader and two other members own a wheat drill. They all four 
 use the two machines. Therefore each man gets the use of these two 
 machines at one- fourth the cost of each man owning a separate ma- 
 chine — and if taken care of, a machine will last just as long with four 
 using it as one, for the less a machine is used, the more it will rust. 
 
 "We have several binders in our local, each owned by two or more 
 individuals, and several mowers and rakes owned the same way. Five 
 own a stalk cutter, and five own a steel roller. Our neighborhood is 
 thickly settled, and it is almost as convenient to own such machines in. 
 co-operation, as mentioned, as to own them separately, and a good deal 
 more convenient to our pocketbooks sometimes !" 
 
 This practical test of co-operation in the purchase of 
 
 63
 
 64 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 improved farm machinery is better worth attention than 
 any theoretical argument against the workableness of the 
 idea, such as one of my friends recently put forth. Of 
 course, there should be a definite understanding in the very 
 beginning as to the rules which will be observed by the 
 joint owners, and these rules should be set down in writing. 
 For example, it should be prescribed; 
 
 (i) That the machine should be kept under cover when 
 not in use. 
 
 (2) That a member should pay for any breakage occur- 
 ring while in his care. Of course, if a broken part was par- 
 tially worn out when the member took it, he should pay 
 only the depreciated value of the portion broken. 
 
 (3) That in case more than one member should wish the 
 use of a machine at a time, members shall take first choice 
 in rotation. Suppose, for example, there are four members. 
 The simplest and most easily remembered plan is to let the 
 man who has first choice in the beginning have second 
 choice the second time, third choice the third time, fourth 
 choice the fourth time, while the fifth time he would begin 
 first again and repeat as just indicated. The plan would 
 give all an absolutely equal deal in the long run, each man 
 having exactly the same number of first, second, third and 
 fourth choices as follows: 
 
 xTA»;r,r«T,^AT,i>,r.T, / ^^^ CHOICE ON EACH OCCASION ,^ 
 
 NAME OF FARMER First time Second time Third time Fourth time 
 
 Farmer A 1st 2d 3d 4th 
 
 Farmer B 2d 3d 4th 1st 
 
 Farmer C 3d 4th 1st 2d 
 
 Farmer D 4th 1st 2d 3d 
 
 In the next place, a good example of how collective mar- 
 keting of produce pays is afforded by the Mecklenburg 
 County, N. C, Farmers' Union. Up to five years ago the 
 farmers had received only 1,400 pounds of meal in ex- 
 change for each ton of seed. The Union farmers then voted 
 to hold their seed and to put them back in the ground if the
 
 SOME farmers' clubs I HAVE KNOWN, AND THEIR WORK 65 
 
 mills would not give them a "ton of meal for a ton of seed." 
 The non-Union farmers decided they would get some of 
 the benefits the Union held out for them, and began hold- 
 ing, too. The result was that in about two months' time 
 the mills surrendered to the farmers' demands. 
 
 This plan held good for two years, but at last the 
 mills took advantage of the farmers' indifference and re- 
 duced to i,8oo pounds the quantity of meal they would 
 give in exchange for a ton of seed. 
 
 Thereupon, however, the farmers revolted again, and 
 planned an even more effective pooling arrangement than 
 before. The Union members began consigning their seed 
 to their county business agent and he very quickly ob- 
 tained terms of even exchange — "a. ton of meal for a ton of 
 seed" — from the Mecklenburg mills. 
 
 Another fine illustration of how the members of a local 
 club can work together came to light when I was on a 
 visit to my old home county a short time ago. 
 
 Seeing that clover seed were so high, and that the land 
 needed clover so badly, a group of farmers there got to- 
 gether and subscribed $500 — fifty shares at $10 each — to 
 buy a clover huller. Then at the right season they hired 
 a traction engine to take it from place to place (just as 
 they would a wheat thresher), and set it up at some man's 
 barn staying two or three days and doing the work for 
 him and all his clover-growing neighbors. They charged 
 four cents a pound for hulling crimson clover, and five 
 cents a pound for red, making it cost $2.40 a bushel to hull 
 the crimson clover seed and $3 the red — not a big charge in 
 view of the fact that crimson clover seed were then selling 
 at the neighboring store at $10 a bushel and the red at $18 
 to $20. One farmer took over his crop to be hulled, say- 
 ing, "I reckon this pile ought to hull me out a bushel of 
 seed, and that's $3," and found instead that he had six 
 bushels and his bill was $18! At first he felt like he was 
 bankrupted until he recalled that he could sell his product 
 for about $100!
 
 66 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS J 
 
 Now all sorts of good results have followed this experi- 
 ment in co-operation. Best of all, all the farmers round 
 about are growing clover as never before, and last spring 
 it was a joy to ride over beautiful fields knee deep in clover 
 where they were formerly bleak and barren. But more 
 than that the scheme paid — paid like a gold mine. When 
 the managers wound up the season's business, they found 
 they had paid all expenses and had a handsome dividend 
 for every stockholder. In fact, the profits were so good 
 that this year the price of hulling will be reduced. 
 
 When away over in the Blue Ridge Mountains a few 
 weeks ago the news that came to me as to the activities 
 of the local Union there was that its members had joined 
 together and bought a pure-bred bull. Now, if other locals 
 in the same county will go a step together and add the 
 co-operation of groups of farmers to the co-operation of 
 individual farmers, the problem will be solved. Only re- 
 cently we came across a farmer's complaint to the effect 
 that farm papers are always telling farmers to get pure- 
 bred cattle, whereas he said nine-tenths of them are too 
 poor to buy the high-priced sires. But the remedy, as Mr. 
 H. W. Collingwood pointed out to the farmer-critic, lies 
 in the co-operative breeding associations so popular in 
 Europe : 
 
 "Half a dozen neighbors combine and buy a good bull. The cost to each 
 one is not large, and the bull can be used in several herds. This works 
 out well in parts of Wisconsin. After the bull has been used three 
 years there will be found another community ready to change, so that 
 new blood can be used. In this way and through this form of co- 
 operation farmers who could not afford to buy a first-class bull alone 
 may combine and thus obtain the best. This is no dream or theory — 
 it is being worked out in many communities where farmers have 
 learned to combine their efforts and live and let live. It is just an- 
 other illustration of the fact that poor, individual farmers may find 
 some relief from their hard necessities by co-operation." 
 
 The writer is also a stockholder in a very interesting 
 farmers' marketing association promoted by a local club.
 
 SOME farmers' clubs I HAVE KNOWN, AND THEIR WORK 67 
 
 The whole plan, in fact, of this particular marketing as- 
 sociation seems to me to deserve the most careful con- 
 sideration of farmers everywhere. The movement had its 
 origin when a group of farmers, being much disadvantaged 
 in marketing their produce, got together and agreed on an 
 experimental form of co-operative marketing. The plan in 
 brief was this : 
 
 1. One member was employed (with his team) to take 
 the produce of all members to town twice a week. 
 
 2. Three central concentration points along the route 
 (homes of members) were agreed upon, say about two 
 miles apart, at which the farmer members were to collect 
 their stuff. In applying this principle, we will suppose, 
 for example, that there is a group of farmers along a mar- 
 ket route running from three to nine miles from the town. 
 Well, the farmers will agree to have three central stations 
 — one eight, one six, and one four miles from the market. 
 The night before the selling agent is to make his trip to 
 market each farmer will take whatever he has to sell to 
 the nearest concentration or collection point. 
 
 3. For this service the selling agent was paid a commis- 
 sion of 15 per cent on all sales. 
 
 Now, let us see how this plan worked. It naturally had 
 three important results. 
 
 First of all, the farmers got their stuff on the market for 
 half the former cost. Previously, if a farmer had a dozen 
 cabbage, or a couple of hams, or half a dozen chickens, 
 or two dozen eggs, he had to make the trip himself or 
 send a hand in order to effect a sale. The cost of market- 
 ing might absorb all the profits of the sale. Certainly the 
 cost of marketing under this method was not half the 
 average cost under the old individual method of marketing; I 
 suspect that one-third would be a more accurate estimate. 
 
 In the second place, farmers marketed much stuff that 
 would never have been marketed at all with the policy of 
 having every farmer act as his own salesman — could never 
 have been profitably marketed at all. For example, for-
 
 68 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 merly a farmer might have had a bushel of peas, or three 
 dozen tomatoes, or a half bushel of lima beans. He would 
 naturally have said, "I can't make a trip to town just to 
 take them," and thus would have left this surplus product 
 to rot; whereas under the plan we are considering he 
 could easily have sent it a mile to the nearest collection 
 station for the selling agent to market next day. So the 
 co-operative marketing plan not only cuts the cost of mar- 
 keting in half, but it converts into money many surplus 
 products on the farm that would, in fact, never be marketed 
 at all under other conditions. 
 
 In the third place, the selling agent being employed for 
 a large part of his time and marketing a great variety of 
 stuff, naturally keeps up with prices as it is impossible for 
 the individual farmer to do. Go into your nearest city 
 tomorrow and you may find farmers selling eggs or 
 chickens or apples at half a dozen different prices. The 
 farmer who has only a dollar's worth or so of produce 
 cannot take time to find out the real market value of the 
 product, but a regular selling agent can. 
 
 Moreover, the selling agent, because he makes regular 
 trips and has fresher stuff, can easily develop a regular line 
 of customers as the individual farmer could not; and, 
 finally, the selling agent can, in a measure, grade his prod- 
 ucts himself (with certain handicaps owing to variety of 
 ownership), and can easily teach his patrons the value of 
 grading. 
 
 This plan as tested out a year ago had such advantages 
 that a larger and better system is now being developed. 
 Instead of having one of the members give two days a 
 week to the work, a man is to be employed to give all his 
 time to it. A co-operative stock company (with dividends 
 payable on patronage) has been organized and the further 
 details may be quoted from the following official circular 
 setting forth the plan of organization :
 
 SOME farmers' clubs I HAVE KNOWN, AND THEIR WORK 69 
 
 "The necessary stock having been subscribed, the stockholders 
 would meet and effect a permanent organization by electing such 
 officers as would be needed for conducting the business — President, 
 Vice-President, Secretary, Treasurer and a Board of Directors. The 
 Board of Directors would elect a Manager, who would conduct the 
 business under their direction. The Board of Directors would define 
 the Manager's duties and pass on all operating expenses before being 
 paid. 
 
 "The Board of Directors should rent a storeroom or warehouse at 
 the basing point, where the Manager could have an office and ample 
 room for storage and handling the business. They should employ a 
 competent man for his full time to collect and market the produce for 
 the members. 
 
 "Ample equipment should be provided by the Board of Directors 
 for carrying on the business and should consist of spring wagon, 
 harness, auto wagon, etc., for collecting the products on the routes, 
 and for marketing these products as rapidly as possible. 
 
 "Also refrigerator butter crates, milk cans, etc., needed for han- 
 dling perishable goods in warm weather, also whatever office fixtures 
 necessary for keeping accounts, etc. 
 
 "Routes should be established from the basing point covering the 
 territory where the patrons reside, and should go to or near their 
 homes. These routes can be provided to serve the territory north, 
 east, south and west of Harrisburg. Collections and marketing can 
 be done on alternate days, making one collection a week on each 
 route, and marketing three days each week. 
 
 "After all expenses, including salaries, interest, rents, incidental 
 expenses, etc., have been paid from the profits, and there is still a 
 surplus on hand, it should be pro-rated among the patrons according 
 to the amount of products they have furnished the association. Mr. 
 A. furnishes twice the value of products as Mr. B., therefore he shares 
 twice as great in the division of this extra profit. 
 
 How Patrons Are Paid for Products 
 
 "The collector will give each patron a ticket for whatever products 
 he collects from him each trip, and take a duplicate ticket back to the 
 office. The Manager keeps an itemized account for each patron, every 
 two weeks he sends his patrons cash or check for the products fur- 
 nished the association for the two-week period preceding. The patron 
 having his tickets given him by the collector, can at a glance tell 
 whether his pay is correct or not. Any mistake can easily be detected 
 and rectified at once."
 
 CHAPTER VII 
 
 HOW TO ORGANIZE A CO-OPERATIVE SOCIETY 
 
 Thirteen Principles of Successful Co-operation That Should 
 Never Be Ignored — How to Get a Charter — A General 
 Form of By-Laws Which May Be Varied to Suit Local 
 Needs 
 
 THE writer is constantly receiving requests as to 
 how to organize a co-operative society, how such 
 a company should be incorporated, and what 
 should be the form of by-laws, etc. There are 
 undoubtedly many communities where farmers would like 
 to start some co-operative effort, but they delay the mat- 
 ter a great while, or indefinitely, simply because no pro- 
 spective member has had any experience in organizing or 
 incorporating a company. They merely lack information 
 as to how to begin. 
 
 Perhaps in the very beginning we should call attention 
 to some fundamental rules that should be accepted in form- 
 ing a co-operative society (rules based on the long and 
 varied experience of great numbers of co-operative groups), 
 unless clearly unsuited to local conditions. This statement 
 of the fundamental principles of co-operation, which orig- 
 inated in slightly different form with the Right Relation- 
 ship League, I believe, is as follows : 
 
 1. That each shareholder shall have only one vote, regardless of the 
 number of shares held. No proxy voting shall be allowed. 
 
 2. That shares shall be of low denomination ($10 or $5 being com- 
 mon figures) and may be paid in small installments, if necessary. 
 
 3. That the association may have the prior right to purchase shares 
 ■when the owner wishes to sell. 
 
 4. That all goods and produce shall be bought and sold on the cash 
 system and at prevailing prices. Cutting prices is discouraged. 
 
 70
 
 HOW TO ORGANIZE A CO-OPERATIVE SOCIETY 71 
 
 5. That before paying dividends a sufficient amount shall be al- 
 lowed for the depreciation of stock, fixtures and buildings. 
 
 6. That a small surplus may be set aside for enlargement, or as a 
 reserve for a less prosperous season. 
 
 7. That a small amount, say 2 per cent of net profits, may be set 
 aside for educational purposes to promote a better understanding of 
 the cardinal principles of co-operation, its ethical and economical bene- 
 fits, etc. 
 
 8. That capital stock shall be paid a certain fixed and reasonable 
 rate of interest, usually only the legal rate. 
 
 9. That the remaining profits shall be divided among the members 
 and customers in proportion to their patronage. 
 
 10. That one-half as much dividends shall be paid to non-members 
 as to members on patronage. 
 
 11. That the door shall not be shut in the face of any eligible and 
 worthy applicant for membership. No matter if you have become too 
 prosperous to really need further stockholders, he should have the 
 right to purchase one share of stock and become a member. This is 
 true brotherhood. 
 
 12. Except in rare cases, a new co-operative enterprise, whether 
 store, creamery, warehouse, elevator, cannery or what not, should not 
 be started in a community where enough such enterprises already exist 
 to serve the people amply. Instead, the prospective co-operators should 
 bide their time and buy out some existing enterprise when the owners 
 are willing to sell at a reasonable price. 
 
 13. All agreements, contracts, understandings, etc., should be put 
 into writing, and in case of disagreement at any time the matter should 
 be settled by arbitration, each side selecting an arbitrator and these 
 two arbitrators agreeing on a third man to act with them. 
 
 And now as to getting your organization into legal shape. 
 Of course, there are many general lines of co-operation, 
 such as the buying of supplies without a store or ware- 
 house, or the selling of farm products on a small scale, 
 which can usually be safely carried on without incorporat- 
 ing a company. If you are going to undertake any really 
 important line of co-operation, however, the first thing to 
 do is to get a meeting of interested persons, name a tem- 
 porary chairman and secretary, and proceed with discus- 
 sion to ascertain if it is advisable to go into the proposed 
 business, and if so, then the advisability of incorporating 
 as a regular company.
 
 72 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 At this point we cannot do better than to quote the 
 language of Professor Camp, now chief of the marketing 
 division of the North Carolina Experiment Station, whose 
 previous experience in California, Illinois and Missouri has 
 given him a wide outlook, with whom the writer has made 
 some of the investigations recorded in this book, and whose 
 aid we have sought in the preparation of this chapter: 
 
 "The advantages of incorporating a co-operative associa- 
 tion should then be discussed," Professor Camp says. "It 
 should be made clear that incorporation means that the 
 members will not be liable for the debts of the association 
 beyond the amount of the subscribed capital. Before 
 finally deciding to incorporate, three or more should be 
 appointed on a committee to canvass the section to see if 
 a sufficient number are interested in becoming stockhold- 
 ers to warrant the formation of an incorporated associa- 
 tion. The same committee should gather information as to 
 the probable amount of business that may be done and as to 
 the probable cost per unit of business transacted. When 
 the committee is ready to report a second meeting should 
 be called. All of those especially interested should be in- 
 vited to attend. If the committee reports that the number 
 of those who may be expected to subscribe is ample and 
 the business in prospect is sufficient, application should be 
 made to the Secretary of State for a blank certificate of 
 incorporation. This blank must be filled out in order to 
 secure a charter for doing business as a corporation. 
 
 "In filling out this blank, it is well to make the expressed 
 objects for the formation of your organization sufficiently 
 broad to include any possible line of business which you 
 may at any time later wish to undertake. You will then 
 be able to buy or sell or manufacture any products which 
 may later seem advisable without going to the expense of 
 getting a new charter. 
 
 "The certificate of incorporation of the United Fruit 
 Growers of Western North Carolina, North Wilkesboro, 
 N. C, has a broad statement of the objects of a fruit
 
 HOW TO ORGANIZE A CO-OPERATIVE SOCIETY 73 
 
 growers' corporation, which may be taken as a good ex- 
 ample for farmers in other lines. The objects for which 
 this corporation is formed are stated as follows: 
 
 " 'To buy and sell fruits, vegetables, meat, stock and all products of 
 and necessities for Western North Carolina, both fresh and manufac- 
 tured; to erect, operate and maintain canning and packing factories, 
 cider-vinegar generators, and commission houses; to manufacture and 
 grow any and all products of Western North Carolina; to erect, op- 
 erate and maintain ice plants and cold storage, and to engage in such 
 other business as pertains to the fruit and truck growing of Western 
 North Carolina.' 
 
 "The shares had better be made as small as $5 or $10 
 each, so that the poorest farmer may take at least one share. 
 The amount of funds with which the association may begin 
 business — that is to say, the paid-in capital stock as dis- 
 tinguished from the authorized — may be large or small ac- 
 cording to the nature of the business. The amount of the 
 authorized or maximum possible capital stock may be 
 made any sum from $5,000 to $100,000, or more. The cap- 
 ital may be increased in the manner and to the amount 
 the directors may determine as the need arises. If the 
 desire is to begin business on as small a scale as possible 
 the amount of capital need not be large. If supplies are to 
 be largely purchased upon orders which have been pre- 
 viously gathered together from the members, the expense 
 may be apportioned to each member according to the 
 amount of purchases. In the case of the sale of products, 
 the organization may act as the agent of the growers at a 
 fixed rate of commission, which shall cover all expenses. 
 In this way it is possible to get along with a very small 
 working capital. On the other hand, if the paid-in capital 
 can be made larger than the actual necessities of equip- 
 ment and operation, the surplus may be deposited in a 
 bank. This will help to establish the credit of the organ- 
 ization." 
 
 The next question that comes up is as to what the by- 
 laws shall be, and on this point Professor Camp and the writer
 
 74 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 have consulted the experience of a great variety of co- 
 operative societies. In the Appendix I am printing two 
 model forms, which will be found useful in preparing the 
 forms for almost any co-operative organization. These 
 forms may be varied, of course, to meet the wishes of any 
 group of co-operators, but they include certain fundamen- 
 tal features of successful co-operation which should not be 
 lightly disregarded, such as patronage dividends, "one man, 
 one vote," etc., explained in our thirteen rules already 
 given. 
 
 The set of by-laws first given in the Appendix are based 
 chiefly on a model recommended by the Wisconsin Board 
 of Public Affairs and on the by-laws of the Catawba Co- 
 operative Creamery. 
 
 The second set of by-laws Dr. John Lee Coulter picked 
 out from among dozens as the finest sort of model for 
 farmers to adopt. This model is the form used by the highly 
 successful and efficient Lakefield Farmers' Co-operative 
 Elevator Company of Lakefield, Minnesota; and, as will 
 be seen, it can be varied to meet the needs of almost any 
 form of farmers' co-operative society. Furthermore, as 
 Dr. Coulter points out, these by-laws show in a concrete 
 way the actual experience of this farmers' company. It 
 started out as a pure corporation, calling itself "co-opera- 
 tive," but finally, as shown by the last clauses, amended its 
 rules and regulations and adopted the purely co-operative 
 principles.
 
 CHAPTER VIII 
 
 HOW CO-OPERATION REMADE A MINNESOTA 
 
 NEIGHBORHOOD 
 
 Twelve Forms of Co-operation in One Community — Ho7i> It 
 All Started — Pastor Lundberg a Power for Progress — The 
 Mysterious Way He Paid His Note — The Co-operative 
 Store and How the Town Merchants Got Gloriously Licked 
 When They Tried to Crush It. 
 
 SVEA, Minnesota, so far as I know, is the finest ex- 
 ample of co-operative community effort in America, 
 the finest example extant of farmers getting together 
 and pulling together as one man to build up the 
 neighborhood, not only in everything affecting their work 
 and business, but in everything affecting the social life, the 
 intellectual and educational development, and even the 
 moral standards of the community. 
 
 Svea, as I found with equal surprise and gratification 
 when I visited it, is an absolutely pure and unadulterated 
 country neighborhood, ten miles from a railroad station, 
 and there is no village at all except the postoffice and the 
 offices of the farmers' co-operative enterprises and the homes 
 of their managers. Untouched by town influences, there- 
 fore, these Svea farmers are working out their high destiny, 
 and are showing the whole world what farmers can do, 
 aided only by intelligence, neighborliness, energy and stick- 
 to-it-iveness. In Svea they have established and operated 
 thus far without one single failure — 
 
 1. A co-operative creamery. 
 
 2. A co-operative telephone company. 
 
 3. A co-operative grain elevator. 
 
 4. A co-operative live stock shipping association. 
 
 76
 
 7^ HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 
 5. A co-operative store. 
 
 6. A co-operative insurance company. 
 
 7. A co-operative bank (now forming). 
 
 Moreover, they also have as a result of what we may 
 term co-operative effort — 
 
 8. A thoroughly equipped high school, with agricultural 
 and domestic science teaching, 
 
 9. A consolidated church with a resident pastor. 
 
 10. A school library and a State traveling library. 
 
 11. Neighborhood social meetings three times a month 
 under church influences. 
 
 12. They have "made their neighborhood a reading neigh- 
 borhood." Almost every farmer takes two to four farm 
 papers and other reading matter in proportion. 
 
 In other words, the Svea farmers have become "business 
 men" as surely as commercial men in the towns are busi- 
 ness men, and are doubling their profits as a result, while 
 they are at the same time developing a high degree of cul- 
 ture and that satisfying social life without which mere 
 money is valueless, while also maintaining those moral and 
 spiritual influences which town life tends to destroy. 
 
 And the most glorious fact about it all is that by adapting 
 the business enterprises to local conditions, and following 
 the example of Svea with regard to social, intellectual and 
 moral influences, almost any rural neighborhood can win 
 for itself the increased profits, the added culture and the rich 
 social life which the wise farmers of Svea have shown how 
 to win. 
 
 The first co-operative enterprise begun by the Svea farm- 
 ers was the creamery started in 1896. Most of the mem- 
 bers had been conspicuous in the Farmers' Alliance move- 
 ment several years before ; and failing in their effort to 
 better their condition by means of legislation, they set out 
 to see what they could do by means of self-help. The sec- 
 tion being well adapted to dairying, and many of the farm- 
 ers being dairymen in a small way, they naturally took to 
 the creamery idea first, especially as the prices paid for
 
 HOW CO-OPERATION REMADE A NEIGHBORHOOD 77 
 
 butter had been running low. Mrs. A. O. Nelson, wife of 
 one of the co-operative pioneers, in whose home I stopped, 
 says her mother years ago sold butter for five cents a 
 pound, and Mr. Nelson says his father sold it for three 
 cents — and took pay in calico! "But I do not blame the 
 merchants," he explained, fair-minded man that he is, in 
 making the statement. "Three cents was about all that 
 the butter was worth to them, because they had no dis- 
 tribution and there was no grading as to quality, but it was 
 all dumped into a barrel together and sold as grease." 
 
 The co-operative creamery in Svea, and elsewhere in the 
 Northwest, therefore, like the co-operative creameries in 
 Denmark and Ireland, came not only to save farmers the 
 profits previously paid to middlemen, but to create new 
 profits: (i) by guaranteeing quality — genuine, money- 
 compelling, profit-insuring quality — for the farmers' prod- 
 ucts, and (2) by providing a scientific, businesslike sys- 
 tem of finding profitable markets and of satisfying and even 
 gratifying these markets when found. Instead of three or 
 five cents a pound for butter, the Svea farmer now gets 
 30 to 35 cents a pound without any further expense for 
 marketing, and shares in whatever profits the creamery 
 makes. 
 
 I might also as well say now as later that this creamery, 
 and practically all the other Svea co-operative enterprises 
 are conducted on the true Rochdale co-operative plan. 
 That is to say, they never pay more than legal interest 
 on capital stock, and divide profits upon the basis of patron- 
 age, paying farmers who are not shareholders only one- 
 half the rate paid shareholders. But any patron may be- 
 come a shareholder by subscribing for a small share of 
 stock. 
 
 That there is nothing like one success to inspire con- 
 fidence in attempting another, we all know; and it was 
 only natural that after getting on so well with the creamery 
 from 1896 to 1900, the Svea farmers in the latter year seized
 
 78 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 an opportunity to take over the local telephone system and 
 put it on a co-operative basis — another undertaking which 
 has proved a thoroughgoing triumph. To the general pub- 
 lic, low rates were given and to shareholders still lower 
 rates, with the result that probably ninety out of one hun- 
 dred of the farm homes in the country have local and long- 
 distance connections with both their farmer neighbors and 
 their city neighbors, and with all the world outside. "The 
 only man I ever knew without a telephone," said one Svea 
 citizen to me, "is a fellow below the hill there, and he is no 
 man at all." 
 
 In establishing the Svea co-operative telephone system, 
 as in all similar attempts at co-operation there for years, 
 a plumed knight in the ranks of progress, a leader whose 
 great influence always told mightily for good, was Rev. 
 J. O. Lundberg, the pastor of the Swedish Lutheran 
 Church — a man whose memory will always be cherished by 
 the people he loved and served. 
 
 Pastor Lundberg was one of those preachers — alas, yet 
 too rare — who recognized the fact that it is the purpose of 
 religion to bring God's radiant kingdom to this old earth 
 as well as reveal to us a future kingdom in the New 
 Jerusalem, and that the only practical active way to serve 
 the Lord here is to serve His creatures, His substitutes, in 
 fact, of whom He has said : "Inasmuch as ye have done 
 it to the least of these, ye have done it unto me." Pastor 
 Lundberg did not interpret with any silly literalism, for 
 example, the injunction to feed the hungry, but he believed 
 that he should encourage the agencies that would keep 
 men from want and hunger as well as relieve them after 
 they had become hungry; and he recognized, too, the fur- 
 ther fact that hunger for a richer social, intellectual and 
 community life should be relieved as surely as hunger for 
 material bread and meat. So the co-operative telephone 
 system, for instance, which has brought happiness in and 
 driven loneliness out from the lives of scores and hundreds 
 of Svean farm women — this system owes much to the in-
 
 HOW CO-OPERATION REMADE A NEIGHBORHOOD 79 
 
 ' fluence of the Lutheran pastor who showed his interest by 
 ) becoming from the first an officer of the company. In fact^ 
 ! there are some who say that the whole wonderful develop- 
 ment of the co-operative spirit in Svea had its beginning- 
 \ when the farmers, regardless of minor sectarian differences,, 
 decided to come together and support one strong, powerful 
 church with a resident pastor to lead and serve all right- 
 eous causes in the community. 
 
 At any rate, Pastor Lundberg, giving his personal aid 
 ; and the aid of his church to every movement for bettering- 
 I the community — socially, educationally, intellectually, in- 
 . dustrially — became an example of what a consecrated and 
 I forceful preacher can do; and when the farmers, in 1909, 
 ) decided that the)'' ought to go a step further and establish 
 . a co-operative store, it is not surprising to learn that, 
 ' though without ready money, he was one of the first 
 ! to subscribe for $100 in stock, by giving a promissory note 
 ' in payment. The store, of course, was operated on the 
 Rochdale plan, paying only 6 per cent on stock and divid- 
 [| ing all other profits on the basis of patronage — that is to- 
 say, if the company made profits enough, it would pay back 
 shareholders, say, $8 for each $100 worth of goods they 
 purchased, and non-shareholders $4 for each $100 pur- 
 chased by them — and what happened to Pastor Lundberg's 
 promissory note is a fine illustration of the store's success. 
 Ten months after the store started, though he hadn't paid 
 in a cent on his share, the management checked up ac- 
 counts with him and found that his dividends on his trade 
 amounted to enough to pay the $100 note, the 6 per cent 
 interest on it, and $44.60 besides. A somewhat similar 
 experience was that given me by Mr. A. J. Abbott : *T 
 bought two shares at $105 each on credit, and in eighteen 
 months my dividends had paid for one of them, leaving- 
 me only one to settle for." 
 
 Several factors have contributed to the success of the 
 Svea Co-operative Store. To begin with, the members 
 did not make the primary and fundamental mistake of
 
 80 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 establishing a new store, thereby adding to the already 
 excessively large number of middlemen. On the contrary, 
 they (i) bought out the existing store at Svea — even 
 though the owner did sell to them a little reluctantly perhaps. 
 (2) They employed a thoroughly competent manager, for 
 the manager's efficiency is half the battle. (3) They paid 
 him a good salary, for the co-operators boast that "We pay 
 higher salaries than privately owned stores." (4) They 
 established a strict and business-like system of auditing and 
 accounting. (5) They went into the plan with character- 
 istic Swedish dogged persistence, resolved to stick to it for 
 better or worse. 
 
 The supreme test to their loyalty came about two years 
 ago when the town merchants of Willmar, the county seat, 
 ten miles from Svea, aided and inspired by the old Svea 
 merchant the co-operators had bought out, decided it was 
 time to break up this high-handed independence the farmers 
 "were showing. 
 
 Not only had these countrymen established a co-opera- 
 tive creamery, telephone system, store and stock shipping 
 association, but they had gone into Willmar and estab- 
 lished a farmers' co-operative grain elevator in opposition 
 to the capitalist-owned elevators already operating. It was 
 surely time to do something, the Willmar merchants de- 
 cided — time either to make terms with the embattled farm- 
 ers or organize, fight and conquer them; and, ill-advised, 
 they decided upon the latter policy. Pooling their interests 
 and putting up the necessary capital, they rented the old 
 Svea store building the co-operators had moved out of, 
 put a clever and capable manager and a fine stock of goods 
 into it, and set out to "put the co-operative store out of 
 business." This was planned, in fact, as the beginning of 
 the end of the whole co-operative movement. "They 
 wanted to break up our store and our creamery and our 
 elevator and our stock shipping association, one and all," 
 says Mr. A. O. Nelson. "The only thing they figured on 
 leaving us was our preacher."
 
 HOW CO-OPERATION REMADE A NEIGHBORHOOD 81 
 
 But the Willmar merchants had reckoned without their 
 hosts. They had flung a red flag in the bull's face, and 
 what the Svea folks did to their anti-co-operative store was 
 enough. The manager was. a clever and capable man, as I 
 have said, but he not only did not get patronage, he did not 
 even get a chance to explain what terms he would make on 
 patronage — that is to say, not to any of the co-operators. 
 "Did he cut prices on you? Did he try to break up your 
 co-operative store by underselling you?" my friend Mr. 
 Green asked Mr. Nelson as we talked. "That's what we 
 don't know," was Mr. Nelson's reply, "because we never 
 bought anything from him to find out !" 
 
 The women had up their fighting blood even more de- 
 cidedly than the men. "Tjie manager was a verra nice man 
 and had a mighty sweet wife," a co-operator's wife ex- 
 plained to me, "and I was sorry for his wife, but still we 
 never invited her to visit us because we did not want to be 
 under obligations to them and we thought the quicker they 
 left the better." 
 
 But the Svea co-operators did not stop with their own 
 passive resistance or their wives' passive ostracism — they 
 resolved to carry the war into Africa. "Since these Willmar 
 merchants have come down here fighting us because of our 
 little store," they said, "we'll give them something worth 
 worrying about." The Svea co-operators met and resolved 
 not only to stick to their Svea enterprise, but to establish, 
 if possible, a co-operative store in Willmar itself. "Three 
 hundred dollars was voted for organization expenses," as 
 one Svea woman said to me, "and then a good many of us 
 shivered, for we didn't know what would happen." It was, 
 indeed, a bold stroke, but it won. A new $20,000 co-opera- 
 tive store was started in Willmar, one of the merchants 
 there selling to the farmers and hiring to them as manager ; 
 the opposition store at Svea, a dreary and hopeless failure, 
 soon had to close its doors; and since then both Svea and 
 Willmar co-operative enterprises have waxed strong and 
 powerful. The Svea store last year after putting lo per
 
 ■I 
 
 82 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 cent of its profits into a reserve fund, paid a 6 per cent 
 dividend on member's patronage (that is to say, returned 
 stockholders six cents for each dollar they had traded dur- 
 ing the year), and paid half as much or around 3 per cent 
 to non-shareholders, while the Willmar store paid 12 per 
 cent to stockholders and 6 per cent to non-members.
 
 CHAPTER IX 
 
 WHY CAN'T YOU HAVE A NEIGHBORHOOD 
 
 LIKE SVEA? 
 
 Education the Foundation — The Community Church and Its 
 "Coffee Socials" — Why the Co-operative Store Succeeded — 
 The Farmers' Grain Elevator and Its Figltt with the "Trust" 
 — An Appeal to the Reader 
 
 I AM going to stop right in the middle of my story of 
 the wonderful success of co-operation in Svea to tell 
 what I believe is the chief secret of its wonderful suc- 
 cess in this Minnesota farm neighborhood. That 
 secret is nothing more nor less than education, education, 
 education — and a willingness to pay any price necessary to 
 get adequate educational facilities for the community. When 
 I asked Mr. A. O. Nelson, the hustling, red-headed, wide-awake 
 leader of co-operation in Svea, what was their rural 
 school tax, he almost struck me dumb when he answered 
 promptly: 
 
 "Seventeen mills, or $1.70 on the $100 of property!" 
 Of course, this is something unusual. It is, in fact, 
 nearly double the local school tax even Svea folks usually 
 pay. Two or three years ago, however, they decided they 
 wanted a handsome new building with industrial features — 
 agriculture for the boys and domestic science for the girls — 
 together with transportation of pupils living over two miles 
 from the school (two miles in a blizzardy Minnesota win- 
 ter is easily the equivalent of four miles in the South) ; 
 and so $1.70 on each $100 worth of property was the tax 
 they voted, although they had only one school organiza- 
 tion to keep up. Our Southern communities with two sep- 
 arate school systems to maintain frequently boast them-
 
 84 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 selves mightily for voting a thirty-cent tax on themselves. 
 
 Eight months term a year with two teachers — a man who 
 teaches agriculture, a woman who teaches domestic science ; 
 compulsory attendance from eight to sixteen; free text 
 books for all pupils; a good school library; reproductions 
 of noted pictures on the wall — all these the farm parents 
 of Svea have provided for their boys and girls, and they 
 are arranging to have an eight-acre school farm as well. 
 
 Moreover, education in Svea is not confined to the young 
 people. Education, in fact, cannot be confined to the 
 period of youth, but the truly educated man must go on 
 learning all his life — like the old man of 76 years old who 
 attended a short course at the Danish agricultural school 
 I visited one summer. If a man has had poor school ad- 
 vantages, he can nevertheless educate himself by reading 
 plenty of the right kind of books and papers — the right 
 kind, be sure; and no matter if a man has been highly edu- 
 cated in the schools, he must read much if he is to get real 
 dividends and benefits from his early training. The farm- 
 ers of Svea realized this, and another secret of their success 
 leaked out when I asked the mail carrier if most farmers on 
 his route took a farm paper. 
 
 "Well, I should say," was his reply. "Two or three farm 
 papers on an average ; most of them take three or four." 
 
 Most of them read books, too. Not only is there a school 
 library, but a State-supported traveling library also en- 
 larges their intellectual horizon ; and only a few feet from 
 the door where I met the mail carrier, I saw this sign 
 posted up : 
 
 Minnesota Traveling Library — Free to All 
 
 This library is now located at Svea, Minn. Open to the 
 public Monday until Saturday from 8.00 a. m. till 9 p. M 
 
 Lottie B. Nelson, Librarian.
 
 WHY can't you have A NEIGHBORHOOD LIKE SVEA? 85 
 
 In addition to having the good sense to provide excellent 
 schools for their children, the Svea farmers have had the 
 great good fortune to be free from denominational faction- 
 alism. There was not much difference in belief among 
 them anyhow, so instead of having two or three half-dying 
 churches, each with a monthly meeting and a handful of 
 members, they have one strong church which largely shapes 
 the life of the neighborhood, moral and social. 
 
 Consider, for example, how greatly the life of the com- 
 munity has been enriched and sweetened by the justly 
 popular "coffee socials," as they are called, held three times 
 monthly at the homes of members in rotation. These 
 meetings are usually held on Wednesday afternoon from 
 2 to 5 o'clock, and fifty to one hundred of the neighbor- 
 folk, both old and young, are likely to attend. Light re- 
 freshments are served ; there are songs and stories, games 
 and gossip, a talk perhaps by one of the men, or an essay 
 by one of the women, or ice cream to be sold for church 
 purposes. Such is a typical program; and while most of 
 the older married folks go home about 5 o'clock, some of 
 the younger ones and a few of their elders are likely to 
 remain for the evening. 
 
 Naturally enough, the pretty schoolgirl who told me 
 most of these "coffee socials" not only had some enthu- 
 siasm for them herself, but added, "My mamma goes to 
 every one that comes." We need such meetings all over 
 our farming sections to vary the monotony of toil for both 
 old and young, men and women, and where one country 
 church is not strong enough to support them, why shouldn't 
 two or more churches drop their differences long enough 
 to co-operate in working out some such plan as I have 
 described? That a community is much bettered by having 
 its social life under such elevating influences as surround 
 the Svea "coffee socials" goes without saying. 
 
 From my consideration of the social and educational life 
 of this Minnesota country community, however, I must 
 now get back to the question of their work in practical
 
 86 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 business co-operation. When I left off in the preceding 
 chapter, I was telling of their interesting experience in 
 maintaining their little co-operative store at Svea when the 
 town merchants from Willmar joined together and tried 
 to put it out of business and how the Svea folk, in retalia- 
 tion, established one in Willmar itself, now perhaps the 
 best paying store in that town. 
 
 It should not be forgotten, however (i) that in neither 
 case did the co-operating farmers start a new store; they 
 simply bought out an old one; (2) that in Svea the store 
 succeeded so well because the members, having bought out 
 the storekeeper who was there before, have a clear field, 
 and have had it clear all the time except for the few 
 months the Willmar-supported rival faced them ; and (3) 
 that the Willmar store could never have won the success 
 it has achieved but for the fact that in addition to its hun- 
 dred or more farmer-stockholder patrons, it has a hundred 
 or more stockholders in town. In fact, it is likely that the 
 town stockholders supply most of its trade. Paying a $5 
 membership fee and subscribing for one or more shares 
 of stock at $10 each (only legal interest is paid on stock) 
 makes one a shareholder, and inasmuch as stockholders get 
 twice the dividends on patronage that non-stockholders 
 get, it is not surprising that thirty men made haste to sub- 
 scribe for stock just after the last patronage-dividend was 
 declared, $12 being then returned to each shareholder and $6 
 to each non-shareholder for each $100 worth of goods pur- 
 chased in the preceding twelvemonth. 
 
 The observation is also made both at Svea and Willmar 
 that the co-operative stores on crowded days will hold cus- 
 tomers that a regular merchant would lose. 'T don't mind 
 waiting for the rush business," a farmer patron will often 
 say with a smile-that-won't-come-off, "for I know the more 
 business there is, the bigger will be my dividend next time." 
 
 These stores are in honor bound to sell any patron at 
 least one share of stock and make a member of him if he 
 wishes. Some companies pay dividends to non-members
 
 WHY can't you have A NEIGHBORHOOD LIKE SVEA? 87 
 
 in the shape of credit on stock until his dividends 
 amount to enough to entitle him to a share, whereupon it 
 is issued to him. Reference should also be made again tc^ 
 the importance of the monthly auditing of accounts under 
 an especially efficient system worked out by the "Right 
 Relationship League" of Minneapolis. No co-operative 
 enterprise should ever be started anywhere without pro^ 
 viding for expert auditing. 
 
 In the preceding chapter I also made a brief allusion to- 
 the co-operative grain elevator the Svea farmers estab- 
 lished in 1910 at Willmar, which is their nearest shippings 
 point. An elevator, it will be observed, has about the same 
 relation to the wheat and barley industry of Minnesota that 
 a warehouse has to the cotton industry in the South ; it is 
 the place where the product is stored and from which it is 
 sold and shipped. 
 
 Now at Willmar away back yonder In the days when the 
 Alliance was at the height of its power, the farmers started 
 a so-called "farmers' co-operative elevator" at Willmar, but 
 inasmuch as it wasn't really co-operative, the 30 to 40 per 
 cent profits it started out by making all went to the men 
 who owned stock instead of the men who furnished the 
 business, and the natural result was that profit-hunting 
 city business men began to buy up the stock. The next 
 and equally natural result was that the farmers said, "We 
 are not going to patronize this sham concern just to pay 
 big profits to the capitalist stockholders." So it lost busi- 
 ness and had practically or actually died when the Svea 
 farmers three years ago decided they would pay $950 for 
 the building by itself and start the business again on the 
 genuine co-operative, profits-to-patronage basis. In two 
 years time, I was informed, the elevator on this $950 in- 
 vestment has paid its patrons $5,000 in patronage-dividends 
 besides paying three cents a bushel more for wheat ! 
 
 A record like that is certainly well calculated to make 
 other Western farmers decide to organize and fight the 
 elevator trust which has too long had everything its own
 
 88 now FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 way in many western towns. Not a few of these trust 
 companies were "born in sin and conceived in iniquity" 
 anyhow, and have a sinister record from start to finish. 
 
 C. B. Williams, a well-known Minnesota writer on co- 
 operation, says : 
 
 "To understand how this oppressive [elevator] monopoly could 
 have been built up it is necessary to go back and see how the line 
 houses had before this crushed out most of the independent dealers. 
 The Peavy Company, for instance, between 1877 and 1898 secured con- 
 trol of 800 elevators; Armours had 700; Councilman 150, and so on. 
 The method was this: Charles Peavy, for instance, would go into a 
 town and buy out or build an elevator for $5,000. This would be put 
 into the Peavy Elevator Company for $11,000 of its stock. Five thou- 
 sand dollars of this stock, enough to cover the real cost, would be sold 
 out "> outsiders, the $6,000, or controlling interest remaining in the 
 hands of the company. Thus, in a little over twenty years, they se» 
 cured control of 800 elevators and $4,800,000 cash without the invest- 
 ment of a dollar." 
 
 A favorite device of the elevator trust has been to crush 
 out any farmers' elevator by temporarily offering in that 
 town more than the market price for wheat, thereby taking 
 all patronage away from the farmers' elevator and keeping 
 this up long enough to throw the farmers' elevator into 
 bankruptcy— the trust, of course, simply making good its 
 losses by correspondingly reducing the price of wheat in 
 towns where it had already crushed competition. This is 
 one of the infamous trust practices that should be rigidly 
 prohibited by law. 
 
 Meanwhile to meet this competition the following plan 
 has been proposed and in some cases tried out, and though 
 its legality has been questioned in some other States, the 
 Attorney-General of Wisconsin says it is thoroughly legal 
 provided the agreement is written into the contracts with 
 the farmer members. The plan is this: If the trust iii 
 Willmar, for example, decides to break down the farmers' 
 elevator by paying four cents more a bushel for wheat than 
 the market price (and, therefore, four cents more than the 
 farmers' elevator can pay), the farmer co-operators are au- 
 thorized to go ahead and sell their wheat to the trust but
 
 WHY can't you have A NEIGHBORHOOD LIKE SVEA? 89 
 
 to turn over to their own elevator half their excess profits 
 (that is to say, two cents a bushel), in order to pay its 
 necessary expenses. A plan like this naturally does not 
 please the trust very long. It accomplishes nothing toward 
 crushing its rival, while the farmer members gain at the 
 trust's expense. This is perhaps the most altogether de- 
 lightful game that an exasperated people have ever "played 
 back" on the trusts in return for the many cases of con- 
 scienceless trickery we have suffered by their hands. 
 
 At Willmar at one time since the co-operative elevator 
 was organized the trust professed to pay the farmers two 
 cents a bushel more for wheat, but docked them enough in 
 grading, allowance for dirt, etc., to even up. At another 
 time I learned from the co-operators' manager, barley was 
 selling at $1.13 in Minneapolis, say 100 miles away, while 
 the trust elevators in Willmar were offering only seventy- 
 five or eighty cents a bushel. The farmers' elevator at once 
 carried the price to $1 and $1.02, "Right now," Manager Sun- 
 deine continued, "the trust elevators are paying three cents 
 a bushel less for wheat at Priam and Raymond, the first 
 and second stations west of here, where they have no com- 
 petition, than they are paying at Willmar where the farm- 
 ers are organized for business." 
 
 There are many other things the Svea farmers have done 
 that I should like to discuss, but I have told enough, no 
 doubt, to make the reader wish his community had more 
 of the Svea spirit. And if you, indeed, "covet earnestly 
 these best gifts," kind reader, if you would like to have in 
 your own neighborhood the business co-operation, the in- 
 creased profits from your labor, the richer social life, the 
 enlarged educational opportunities, the general spirit of 
 comradeship, buoyancy and achievement that one finds in 
 the Svea neighborhood, why not set out to improve the oppor- 
 tunities that come to you? Your neighbors are readier to 
 "go in" than you think — if you will only show some leader- 
 ship and appeal to them to help you.
 
 CHAPTER X 
 
 HOW WISCONSIN BERRY GROWERS MET AN 
 
 UGLY SITUATION 
 
 Instead of Cutting Their Crops to Escape Disaster, Sparta 
 Growers Decide to Co-operate and Do Their Own Market- 
 ing — Something About the Success of Their Organisation 
 and Its "Big Stick" Methods — Gets Increased Profits by 
 Knowing Market Conditions, Grading Carefully and Guar- 
 anteeing Quality 
 
 NEXT to the record of co-operation in the Svea, 
 Minn., neighborhood, about the most interesting 
 story of co-operation experience that I investi- 
 _ gated in the Northwest was that of the Sparta 
 
 Fruit Growers' Association of Sparta, Wis. And just as 
 I shall always think of Mr. A. O. Nelson when I think 
 of co-operation in the Minnesota community so I shall 
 always think of Mr. W. H. Hanchett when I think of 
 Sparta. 
 
 Mr. Hanchett is president of this Sparta Fruit Growers' 
 Association and, in common parlance, a genuine "live 
 wire." That's one characteristic of these Western co- 
 operation leaders : they have enthusiasm for their jobs, and 
 put fire and earnestness into what they have to say. 
 
 Seventeen years ago the Sparta fruit growers first organ- 
 ized, but it was only seven years ago that they really got 
 on a business footing. Originally there were only 125 
 shares at $2 each, but the bigger plans of the last seven 
 years are indicated by the fact that there are now 3,000 
 shares of $2 each held by the 302 members, and that the 
 handsome building, the property of the association, in 
 
 90
 
 HOW WISCONSIN BERRY GROWERS MET AN UGLY SITUATION 91 
 
 which I found President Hanchett and Secretary Richard- 
 son, cost $14,000. With a capitalization of $6,000, the 
 present assets of the company (after having paid increased 
 profits to all members) indicate a surplus of $9,000. 
 
 The Sparta farmers, like the farmers in many another 
 community, might never have known the advantages of 
 co-operation if they had not been forced to it. "Necessity 
 is the mother of invention." Around Sparta a great many 
 farmers were growing strawberries and it seemed to the 
 growers that the local buyers had a secret understanding 
 about prices. "My father was one of the pioneer berry 
 growers," Mr. Hanchett told me, "and he used to spend 
 an entire day getting rid of five or six crates at five cents 
 a quart." Moreover, if the farmers shipped for themselves 
 to Chicago, St. Paul, Milwaukee or Duluth, the reply might 
 come back that the market there was glutted and that the 
 freight charges had eaten up the receipts. Finally the 
 farmers grew desperate and many said, "There has been 
 an overproduction. Let's every man plow up half or two- 
 thirds his berry acreage and plant to something else." 
 
 But wiser and bolder men like President Hanchett said: 
 "We shan't do anything of the kind. We have the natural 
 conditions here that suit berry growing, we know that the 
 cities are willing to pay a fair price for the stuff, and we are 
 simply going to get into position to control distribution. 
 We're going to get the profits that somebody else is partly 
 making now, and the profits that are being lost to every- 
 body by wasteful methods of packing and shipping." 
 
 So the farmers came together and agreed that all mem- 
 bers should turn over their entire berry product to the 
 association, its officers to keep in touch with the market 
 conditions in all the principal centers ; control the car 
 service ; grade shipments ; and divide profits among mem- 
 bers after deducting expenses. Of course, the old-time 
 berry buyers were wrathy and for a time they sought to 
 get the local merchants to stand with them against this 
 farmers' movement. But the co-operating farmers quickly
 
 92 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 checkmated this scheme. "We haven't been in favor of 
 starting a co-operative store in Sparta; merchandising is 
 not our business," they said to the merchants, "but we have 
 a right to ship and handle our own berries and we are 
 going to do it, and we are not going to buy our goods from 
 folks who try to prevent us. You just be good, or we'll go 
 further and start a co-operative store." Whereupon the 
 merchants reported that the co-operative fruit growers' 
 association was an excellent thing. 
 
 But, of course, although I said in the last paragraph that 
 *'the farmers came together," not all of them came. They 
 never do. There was one man, for example, who had a 
 brother-in-law in a not distant city and he decided that he 
 could make a few more pennies by staying out of the or- 
 ganization. "Very well," the managers said, "but don't 
 undersell us to get big orders for yourself. We are going 
 to be reasonable and it will be much better for us all to 
 hang together." This man, however, later seized a chance 
 to engage his entire season's crop at so much a crate — a 
 lower price than the association berries were selling for. 
 *'We resolved right then," said the association member who 
 told me the story, "that the time had come for some 'high- 
 handed trust methods', if you want to call them that. We 
 found out what this man had done and proceeded to turn 
 loose all our surplus crop right in his market. Prices 
 dropped short off, his order was canceled, and since then, 
 although he has never joined the association, he keeps step 
 with us and makes prices in harmony with us." 
 
 On another occasion some members were reported dis- 
 loyal. To be specific, it was understood that they were 
 willing to sell some of their extra early berries to regular 
 buyers instead of turning them over to the association. 
 Thereupon the association sent out a fake or decoy buyer 
 and trapped several of them. The members so caught were 
 at first expelled from the association, but were later re- 
 instated, having gained nothing but exposure and con- 
 tempt for their treachery.
 
 HOW WISCONSIN BERRY GROWERS MET AN UGLY SITUATION 93 
 
 The Sparta managers have worked on the theory that 
 
 f: the only way to succeed is to make the members afraid to 
 
 f! break its rules, and non-members afraid to oppose its 
 
 I power. For example, President Hanchett went to the 
 
 II managers of the freight car service and said, "Now, our 
 
 I association will guarantee to use the freight cars we ask 
 
 you to dispatch to Sparta for us. We demand that the 
 
 non-association farmers must also guarantee to use the 
 
 ; freight cars you send for their use, if they are to have the 
 
 same low rates you give us." 
 
 "We are always on the lookout for customers," said 
 President Hanchett, "and Sparta berries not only go to 
 Chicago, St. Paul, Milwaukee and Duluth as formerly, but 
 also to Omaha, Kansas City, Des Moines, Fargo and Win- 
 nipeg. Fruit dealers and grocers in the small towns are 
 also cultivated by us, and are, in fact, our most profitable 
 customers. We also get better prices from the consumers 
 than farmers acting individually would ever have been 
 able to get, because we guarantee quality, which means 
 better service and increased values for these consumers. 
 In the old days there were many partly-filled crates, and 
 many crates with ripe fruit on top and unripe fruit at the 
 bottom — and the buyer had no redress. But on every crate 
 the Sparta association sends out, the grower's number is 
 stamped, and the association is responsible for quality 
 because it can locate and expel any member who swindles. 
 Our grader, of course, is able only to sample occasional 
 shipments here and there as they come in, but if any in- 
 ferior fruit is brought in, the member must personally call 
 the grader's attention to it, or risk the consequences." 
 
 Mr. Hanchett further remarked that the agricultural au- 
 thorities at Madison call the Sparta association a "double- 
 barreled concern," because it works both on the capitalistic 
 and co-operative principle. If a member comes in and 
 wishes the association to handle his produce as an agent, 
 it will gladly do it, remitting him all the proceeds less a 
 reasonable expense charge. That is to say, the profits in
 
 94 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 this case go to patronage. If, however, the member is 
 timid and prefers to sell for cash at a price the association 
 names or accepts, the association buys outright and the 
 profits go to the stockholders. Two years ago the associa- 
 ton bought up at 25 cents a bushel the neighborhood 
 Duchess apple crop, for which little or no market had 
 been found, and by grading and shipping in quantities 
 cleared four or five hundred dollars. For potatoes on one 
 occasion a price of 33 cents a bushel was realized when 
 buyers had offered only 18 or 20 cents. The association 
 also handles seeds and feedstuffs for farmers, and last year 
 shipped five carloads of home-grown clover seed for farmer- 
 members. 
 
 Like all the other co-operative enterprises the Sparta 
 company acts wholly in the open. "Any member can in- 
 spect the books at any time and investigate any item in our 
 $80,000 yearly turnover," said Secretary Richardson. 
 "Every letter and telegram about every shipment is on file." 
 
 Another successful co-operative enterprise we found at 
 Sparta and with which Mr. Hanchett is connected is the 
 Sparta Co-operative Creamery Company. It has been running 
 eighteen years, has 482 members and has a daily butter 
 output of six thousand pounds. In May 80,000 pounds 
 were turned out, netting producers 29 cents a pound. Last 
 winter butter fat brought as high as 38 cents a pound. 
 Cream is collected every other day from each farmer, eleven 
 company teams bringing it in daily. A dividend of 5 per 
 cent annually is paid on the $2,500 capital subscribed, and 
 all other profits are divided on the patronage basis. We 
 found the managers of the creamery seriously discussing a 
 plan to establish a co-operative laundry in connection with 
 the creamery, and this will probably be done before another 
 year ends.
 
 CHAPTER XI 
 
 MORE CO-OPERATION STORIES FROM THE 
 
 NORTHWEST 
 
 The Co-operative Laundry at Chatficld a Project of Interest 
 to All Women Folk — The Shehoygander Farmers and Their 
 Fight with the Cheese Makers — Co-operative Live Stock 
 Shipping and How It Pays in Many Ways 
 
 IN THE Northwest co-operation has become so com- 
 mon that I found in St. Paul a copy of a special maga- 
 zine published for the managers of co-operative enter- 
 prises, while ]\Iilwaukee was preferring to entertain 
 the second annual convention of the "National Association 
 of Managers of Farmers' Co-operative Companies." There 
 has been, in fact, such a varied development of North- 
 western co-operative activity that I can only recount a few 
 of its more notable manifestations. 
 
 One very notable story is that of the co-operative laundry, 
 established in connection with the co-operative creamery at 
 Chatfield, Minn., which I found to be the talk of the North- 
 west. I visited two or three of the creameries where the 
 officers told me they were planning to follow Chatfield's 
 example, and it is not unlikely that within a few years it 
 will be the rule rather than the exception to have a co- 
 operative laundry in connection with each co-operative 
 creamery. In describing the Chatfield laundry the St. Paul 
 Farmer says: 
 
 "A wing was built to the creamery and a ten-horse power gasoline 
 engine installed at a total cost of $2,000, the creamery company financ- 
 
 95
 
 96 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 ing this part of the project. Complete laundry equipment was ob- 
 tained from a manufacturing company in New York and installed in 
 working order at a cost of $3,000. To secure funds for this expense, 
 stock was sold at $5 a share to anyone who would buy, whether a 
 creamery stockholder or not. The town of Chatfield was without 
 laundry facilities, and shares were purchased by town and country 
 dwellers alike. . . . 
 
 "At regular periods a settlement will be made, 6 per cent on the 
 investment will be deducted from the profits, and the remainder will 
 be rebated to the patrons in proportion to the amount of their wash- 
 ing bills, whether they are stockholders or not. That is the true co- 
 operative spirit. It is expected that the charge for family washing 
 can be reduced to three cents a pound, and that the total cost for a 
 family washing will not average more than $2 a month. The farmers 
 pay for their laundry by the month, by having the amount of their bill 
 deducted from their cream check; and the creamery then makes out 
 a check for the full amount to the laundry company. Thus there is no 
 collecting to do except in town, and the townspeople have to pay for it. 
 The laundry gathers and delivers washing in town and collects the bills, 
 and it charges the same rate for laundry work; but at the end of the 
 period, when the rebates are made, the town patrons will be charged 10 
 per cent of the amount of their business for this extra service. Thus, if 
 a 20 per cent rebate is declared to farmer patrons, the town customers 
 will receive a rebate of only 10 per cent." 
 
 Although the help the first month was inexperienced, the 
 creamery made a profit from the start. Here is one monthly 
 statement: 
 
 Receipts for the Month 
 
 Townspeople, cash business $210.58 
 
 Farmers, charged on creamery account 127.37 
 
 Total receipts $337.95 
 
 Disbursements 
 
 Wages $262.23 
 
 Soap, starch, gasoline, etc 30.00 
 
 Sundry expenses 3.90 
 
 Rebate of 10 per cent to all patrons, whether stockholders or not 33.80 
 
 Paid into sinking fund 8.02 
 
 Total paid out $337.95 
 
 Mr. C. J. Manahan, secretary and treasurer of the Chat- 
 field laundry (and also of the creamery), says : "The farm-
 
 MORE CO-OPERATION STORIES FROM THE NORTHWEST 97 
 
 ers' wives around Chatfield are entirely satisfied with the 
 work of the laundry, and say that they are through with 
 washing and ironing at home. They are plannng now on 
 making visits on wash days!" Mr. Manahan also says: 
 "There is no reason why a co-operative laundry should not 
 be located in every creamery district; but the first secret 
 is to have a prosperous creamery back of the venture." 
 
 II 
 
 From ex-Senator Henry Krumrey of Plymouth, Wis., I 
 got an illuminating story of how the farmers of Sheboygan 
 County outwitted the cheese makers and dealers. 
 
 Until recently the farmer-dairymen there have been con- 
 tracting with the cheese makers not only to make the cheese 
 for them, but to sell the product — on a certain commission 
 basis, I believe — but of late years the farmers have found 
 cause to arouse their suspicions. For five months, in 191 1, 
 for example, cheese sold at from 11 to 13 cents, but in win- 
 ter, when most of the product had passed out of the farm- 
 ers' hands, it sold from 18 to 22 cents — only to drop back 
 to 12 cents in May, 1912, about the time farmers would 
 have begun to reap the lion's share of profits. 
 
 True, there was a "cheese board," or exchange, at each 
 cheese-making center where the cheese makers got together 
 to sell the farmers' cheese and where the cheese dealers 
 got together to buy it; but the farmers could not believe 
 they were getting a square deal. They believed that the 
 cheese dealers were paying these cheese makers a bonus 
 beyond and in addition to the official published price ; and 
 before the case ended the charge was proved. 
 
 "In one county in one year," Mr. Krumrey said to me, 
 "$400,000 went to the cheese makers. In an investigation 
 before the State Board of Public Affairs, moreover, the 
 cheese dealers admitted having secret meetings to fix 
 prices. Naturally our farmers became aroused, and we had 
 a great meeting of i,ooo farmers at the fair grounds and
 
 98 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 started a movement for co-operative cheese factories. The 
 result is that forty-three have been started in that one. 
 county, all federated in the 'Sheboygan County Cheese 
 Producers' Association.' 
 
 "Each local association incorporates under the new Wis- 
 consin co-operative law, each member taking one to three $i 
 shares and no member having more than one vote. Five direc- 
 tors are elected who manage the business and employ a 
 cheese maker. Then the officers of the county federation 
 sell the produce of the entire forty-four factories, the 
 farmer getting just what his cheese brings after deducting 
 one-eighth of a cent a pound for selling expenses." 
 
 Thus the cheese makers no longer have anything to do 
 with selling the product, but confine themselves to making 
 as much and as good cheese as they can from the milk the 
 farmers furnish them; and the farmers are getting ready 
 to standardize their product, insist upon high quality at all 
 times, have a registered trade-mark, and capitalize this 
 reputation for quality. 
 
 Ill 
 
 The co-operative live stock shipping association is an- 
 other notable development in many parts of the West, 
 about the best example I found being at Litchfield, Minn. 
 One form of co-operation usually leads to another, and this 
 live stock shipping association was the outgrowth of the 
 successful creamery at Litchfield. 
 
 "Has it paid you?" I asked farmer N. E. Christensen, 
 president of the organization, as he drove up with a load 
 of hogs. 
 
 "Well, I guess yes !" was his emphatic reply as he waited 
 his turn at the wagon scales. "Why, before we farmers 
 organized to ship our own stock, we had to support four 
 or five stock buyers here seven days in the week. That is 
 to say, the profits on our business had to support them. 
 Now all our farmers ship their stock together on Tuesdays, 
 and our only expense is to pay Mr. Halverson for work one
 
 MORE CO-OPERATION STORIES FROM THE NORTHWEST 99 
 
 day in each week, so far as buying is concerned; and the 
 saving goes into our pockets." 
 
 "There are many other advantages," Mr. Christensen 
 continued. "Under the old system a farmer might be pes- 
 tered with visits from buyers when he didn't want them, 
 and again he might have stock ready for market a whole 
 month before a buyer would call. Again, old-time buyers 
 made little difference in favor of quality animals. One 
 man might have fattened his hogs carefully and another 
 might have fed his chiefly on the northwest wind, but the 
 old-time buyer averaged them up together, good, bad and 
 worse, and let it go at that. Now, everything is graded. 
 See that mark Halverson is putting on that calf there? 
 That means he will get a specific report as to the grade in 
 which he is put at the stock yard." 
 
 Last year, according to the figures given me by Mr. 
 Halverson, the manager, this association shipped 6,380 
 hogs, 1,515 cattle, 1,972 veal calves and 1,047 sheep — a total 
 of 10,909 animals, or 146 cars in all, as compared wath 14 
 cars in 1901, the year of organization. Mr. Halverson, who 
 is also manager of the creamery, is released from his cream- 
 ery work Tuesdays to receive, weigh and load the stock. 
 They are then shipped — on Tuesday evenings, I believe — 
 to St. Paul or Minneapolis, and he goes down and spends 
 Wednesday selling them. On his return he mails each 
 farmer a check for the amount of his sales, less six cents per 
 hundredweight to cover Mr. Halverson's expenses and all 
 other expenses of the shipping association. This payment 
 of six cents per hundredweight, live weight (or about one- 
 sixteenth of a cent a pound) pays for everything; the 
 farmers know they are getting exactly what their stock is 
 worth ; and they get cash for their sales. 
 
 No wonder such live stock shipping associations are be- 
 coming popular all over the West. In, Svea they organ- 
 ized one three years ago, and it has been a notable success 
 from the beginning; and I found another strikingly suc- 
 cessful one at work in Dassell, Minn.
 
 CHAPTER XII 
 
 CO-OPERATION TO GET BETTER PRICES FOR 
 COTTON AND COTTONSEED 
 
 ^(i) How Warehousing Prevents Enormous Weather Dam- 
 age; (2) Importance of Making Store Accounts Mature 
 Throughout Cotton-Selling Season; (s) Evidence of Cot- 
 ton Buyers' Trusts in Southern Markets; (4) Proof That 
 Farmers Don't Get Benefit of Grades Above Middling; 
 (§) Cottonseed Prices Ranging from $16 to $33 Same Day 
 — The Co-operative Warehouse the One Sure Remedy 
 
 MCLLIONS of dollars have been lost to our south- 
 ern cotton growers by poor methods of market- 
 ing, and many millions more will doubtless be 
 lost before our farmers adopt the co-operative 
 remedies necessary to bring about a change. Four great 
 needs are : 
 
 (i) Proper housing of the crop so as to prevent damage 
 to quality of lint. 
 
 (2) Plans to prevent the depression of prices by the 
 "distressed cotton" of the early and middle fall. 
 
 (3) Plans which will enable farmers to get the benefit 
 of grades above middling. 
 
 (4) Plans for selling cotton and cottonseed co-operatively 
 in large quantities so as to reduce the losses incurred by 
 supporting the present unnecessarily vast army of buyers. 
 
 And all these considerations point directly to the need of 
 farmers' co-operative cotton warehouses. 
 
 I 
 
 We mention first of all (not because it is first in impor- 
 tance but because it happens to come first in actual opera- 
 
 100
 
 BETTER PRICES FOR COTTON AND COTTONSEED 101 
 
 tion) the need for better housing of the cotton crop, which 
 can best be effected through co-operative warehousing. 
 
 Consider these two illustrations which Prof. Thomas 
 Nelson recently found on the writer's home market : 
 
 In the first case, the owner had thirty-three bales of 
 cotton from which 776 pounds of damaged cotton were 
 picked. This damage was due to the bales lying out in the 
 weather; and while the rest of the lint sold for 11^ cents 
 a pound, the 776 pounds of damaged lint brought only two 
 cents a pound — and the picking itself cost $16.50 extra. 
 
 In other words, there was a loss of 9^ cents a pound in 
 the price of this damaged lint or — 
 
 776 pounds at loss of 95^ cents $74.69 
 
 Cost of picking over 33 bales at 50 cents per bale 16.50 
 
 Total loss $91.19 
 
 Loss per bale, $2.76. 
 
 In this case the loss from weather damage amounted to 
 practically one-half cent a pound. 
 
 In another shipment of 319 weather damaged bales on the 
 same market, it was found necessary to pick off 37,386 
 pounds of damaged cotton, which sold for only seven cents, 
 whereas the rest of the lint brought 12^/^ cents. The total 
 weather difmage loss on these 319 bales by leaving them 
 outdoors after ginning was thus $2,056.23, or $6.65 a bale — 
 nearly lyz cents a pound. 
 
 II 
 
 As a rule, however, the farmer is not required to pick 
 the damaged cotton from the rest. The buyer simply 
 grades the whole bale lower, and the farmer who thinks 
 he has been fooling somebody into paying 10 or 12 cents a 
 pound for water doesn't realize that he has lost $10 in 
 grade for every imaginary $1 he has gained in weight. 
 Upon this point it may be well to quote what Mr. C. C. 
 Moore, once a leader in the Southern Cotton Association,
 
 102 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 tells me he heard a representative of a cotton-exporting 
 firm say on one occasion : 
 
 "The man said he was in the employ of a cotton exporting firm ; that 
 they bought cotton direct from farmers ; that the farmer would not pro- 
 tect his cotton from the earth and weather after ginning; that cotton 
 bales were always damaged from lying on the ground, and that when 
 offered for sale, the buyer makes a guess at the damage, always guess- 
 ing so as to protect himself from loss. For instance, if the buyer be- 
 lieves there is five pounds damaged on a bale, he deducts ten pounds 
 or more; or if the damage perhaps is twenty pounds he deducts 
 forty or fifty pounds and fixes the price of the whole bale with a view 
 to making this deduction." 
 
 In any case, Brother Farmer, don't fool yourself into 
 believing that the cotton manufacturers and cotton buyers 
 are big enough fools to pay you 12 or 15 cents a pound for 
 water. They are not. Make up your mind now that 
 whether or not you warehouse your cotton this year, you 
 will at least put it under shelter in a thoroughly dry place, 
 thereby avoiding weather damage and leaving you in a 
 position to get topnotch prices for the grade represented. 
 
 Ill 
 
 In the matter of plans to prevent the flooding of the mar- 
 ket at the height of the picking season in the fall, there is 
 need both for a new system of maturing payments for fer- 
 tilizer and supplies and for a more extensive warehousing 
 system. 
 
 Instead of our tenants and our poor farmers being forced 
 to sell their crops on glutted markets every year in order 
 to settle accounts falling due from October 15 to Novem- 
 ber 15, it would be better if such accounts matured one-third 
 November i, one-third January i, and one-third February 
 I — or something like that. Even having one-half fall due 
 November i and one-half January i would be a vast im- 
 provement over present policies. The Farmers' Union and 
 other organized agencies of the farmers would do well to 
 push a movement to this effect.
 
 BETTER PRICES FOR COTTON AND COTTONSEED 103 
 
 Warehousing cotton would indeed afford relief to many- 
 farmers in this class, even under present conditions, be- 
 cause many of them could borrow enough on their ware- 
 house receipts to pay what they owe, leaving the cotton to 
 be actually sold later when better market conditions are 
 likely to prevail. Again, there are many farmers not han- 
 dicapped by debt but who wish to make purchases early 
 in the picking season, and who therefore sell their crop 
 early in order to get the ready money. The warehousing 
 plan enables them also to get the needed money without 
 helping glut the market and depress prices. 
 
 IV 
 
 As for our third proposition, how to help the farmer get 
 the benefit of higher prices for his better grades, the first 
 thing needful in this respect is to have sufficient competi- 
 tion in the market where he sells. 
 
 A friend came into my office the other day and said: 
 "You ought to go down to the city cotton market here 
 and see how the game is worked. The buyers stand out 
 in the middle of the street looking for the wagons as they 
 come into sight. When a buyer first glimpses a load com- 
 ing, he says, 'Cotton !' as quick as he can, and that means it 
 is his cotton because he saw it first. The other buyers will 
 not bid against him. I was just down there when two buy- 
 ers saw their farmer-game almost at the same time and 
 both called 'Cotton !' almost in the same breath. So they 
 were about to have a dispute about it but tossed up a coin, 
 and the man who won walked up and took the farmer's 
 bales without opposition." 
 
 I went down unrecognized and found it just as my friend 
 had described. There was no semblance of competition 
 among the buyers. I saw a buyer sight a load coming into 
 view while he was talking with a farmer, and while he could 
 not call out "Cotton" quite so openly as when alone with 
 his brother buyers, he carried his point by singing out.
 
 104 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 "Cotton coming around the corner!" and so walked up and 
 took the load while the other buyers paid no more attention 
 to it than if they had been put there to buy meat instead 
 of cotton. Of course, the signals vary in different mar- 
 kets and with different seasons. 
 
 To the same effect is this testimony given by Mr. J. B. 
 Watt of Charlotte, N. C, who says : 
 
 "I had eleven bales of good middling cotton on the Charlotte market 
 October 1st, and tendered it for sale, and 13>4 was the highest bid 
 offered on the street. I was given to understand, though, if I got a 
 better bid they (the street buyers) would better it. I succeeded in 
 getting a bid of 14 cents, in consequence of which the same buyer who 
 refused to raise the price made an offer of 14.05." 
 
 Mr. Watt evidently means that he first got the higher 
 offer from the representatives of some cotton mill or other 
 outside party before the regular buyers would offer the 14 
 cents he was entitled to. Most farmers, of course, simply 
 take what is offered. 
 
 V 
 
 When such conditions prevail, there is nothing to prevent 
 the individual buyer from cheating the farmer just as much 
 as the grower's ignorance will permit, both on grades and 
 prices. Mr. Charles J. Brand, head of the Bureau of Mar- 
 kets, United States Department of Agriculture, said last 
 year that in Penfield, Ga., where the farmers were not well- 
 informed, he found long-staple cotton selling for two cents 
 a pound or $10 a bale less than it was bringing in Harts- 
 ville, S. C, where Mr. David R. Coker, the famous long- 
 staple grower, is helping the farmers to get the prices their 
 grades entitle them to. Mr. Brand also tells of a cotton 
 buyer who was asked at the best of the cotton season last 
 year as to the grades of cotton he had been buying. His 
 answer was : "Well, I haven't been grading in buying so 
 far, but just taking everything as middling. I shall begin 
 grading, however, from now on." The explanation was
 
 BETTER PRICES FOR COTTON AND COTTONSEED 105 
 
 that fine cotton had been coming in up to that time, much 
 of it strict middling and good middling and middling fair, 
 and he had not given the farmer the benefit of any price 
 above middling. Now that poorer grades were coming 
 in, however, he was ready to grade down to the uttermost. 
 Consider, too, this specimen letter which I received from 
 Mr. W. L. Green of Meridian, Miss., in October, 1913: 
 
 "Now as to the grades. From what I learn there are about as many 
 grades above middling as there are below. I have before me the quota- 
 tions of the New Orleans market for September 22. Middling is 
 quoted at 13^ cents and fair at 15^ cents, a difference of IH cents. 
 Now, what I am driving at is that the merchants of Meridian will 
 never pay the farmer above middling for any cotton." 
 
 Small wonder that one of the most thoughtful agricul- 
 tural leaders in the South recently remarked to the writer : 
 "I am convinced that cotton buyers get half of the increased 
 prices that the mills pay for grades above average quality." 
 In other words, under our present system half the hard- 
 earned wealth the farmer creates in quality of staple is 
 confiscated by buyers instead of going to the grower's 
 needy wife and children. Our friend then gave us an illus- 
 tration: "I was in a cotton buyer's office last fall," he 
 said, "when a farmer came in with a few bales to sell. 
 Ordinary cotton was going at 12 cents and a fraction, but 
 the buyer told the farmer that as these bales were of 
 superior staple he would pay 14 cents, or two cents extra 
 per pound. And then Mr. Buyer told me that the cotton 
 was really worth 18 cents, or nearly six cents extra in the 
 pound." 
 
 In other words, on each 500-pound bale the buyer made 
 $20 clear profit by two minutes' sharp practice or about 
 one-third as much as the farmer and his family had made 
 through a year of weary toiling and planning — breaking the 
 land in winter's cold ; preparing, fertilizing, planting in 
 spring; hoeing and cultivating under summer suns; and 
 laboriously picking the crop in the fall.
 
 106 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 How long will a free people submit to such a system? 
 How long will our cotton growers be content to be mere 
 laborers, surrendering all the business-side of farming to 
 alien interests? 
 
 It is true of scores of markets all over the South that 
 there is no real competition among the buyers. The writer 
 has already noted the private signaling by means of which 
 buyers "divide the spoils" as the farmer's cotton comes in 
 sight. Buyer A makes his bid and Buyers B, jC, D and E 
 do not interfere, for they will take their turns with later 
 bales. And with such a system it is always possible for 
 the shrewd buyer to get the farmer's cotton for much less 
 than its real worth. We know, of course, that many honest 
 buyers will not take advantage of the weak, but it is not 
 fair for the laborer to be thrown bound and helpless before 
 whomsoever wishes to plunder him. And it is not fair to 
 honest cotton buyers for them to have to compete with dis- 
 honest ones when conditions give such an advantage to 
 dishonesty. 
 
 VI 
 
 In this connection it would be well for every cotton 
 farmer to send five cents in stamps for a copy of the bul- 
 letin, "Studies of Primary Cotton Marketing Conditions in 
 Oklahoma," recently issued by the Bureau of Markets, 
 United States Department of Agriculture. 
 
 This bulletin based on careful, authoritative studies in the 
 marketing season of 1912, not only shows wide variations 
 in cotton prices in different towns on the same day, but 
 also proves that equally wide variations may frequently 
 exist in the same town at the same hour. A farmer who is 
 well informed as to market conditions and the value of 
 grades, or a farmer who is selling in a pool with a group of 
 farmers who know, may receive several dollars more a bale 
 for the same grade of cotton than a more ignorant farmer 
 selling alone will receive in the same town at the same hour.
 
 BETTER PRICES FOR COTTON AND COTTONSEED 107 
 
 Here, for example, are the figures collected by Mr. Brand 
 and his several assistants in Oklahoma, showing the varia- 
 tions in prices paid for strict low middling cotton in the 
 same town on the same day — that is to say, the difference 
 between the prices some farmers received and the prices 
 some other farmers received for the same grade of cotton, 
 the same day, figured out on the basis of 500-pound bales : 
 
 Variation Tariatlon 
 
 Town per bale Town per bale 
 
 Okemah $2.50 Terral $4.20 
 
 Mountain Park 3.75 Erick 4.69 
 
 Norman 3.75 Caddo 4.75 
 
 Porter 4.37 Snyder 6.75 
 
 Norman 5.00 Erick 6.25 
 
 Duncan 10.00 Terral 4.50 
 
 Waurika 3.00 Wellston 2.50 
 
 Think of it — some farmers in Duncan, Okla., received 
 $10 less a bale for strict low middling cotton than other 
 farmers received for the same grade on the same day — 
 December 2, 1912! And in Terral, Okla., November 
 12, the variation in prices paid for low middling amounted 
 to $12.50 per bale. And worst of all, in Mangum, Okla., 
 November 7, with twenty-seven buyers in town, the 
 lowest price paid for good ordinary was $19.25 less per 500- 
 pound bale than some other good ordinary cotton fetched 
 the same day ! How long will cotton growers endure such 
 conditions? 
 
 As this bulletin goes on to say, all this enormous loss 
 falls, for the most part, on those least able to bear it, and 
 whose families are least able to bear it — the more ignorant 
 farmers or those who are forced to sell. We quote : 
 
 "If buyer and seller were equally informed as to the grade of the 
 bales offered, and if the sale of the individual bale were a matter of 
 no more importance to the farmer than its purchase is to the buyer, 
 such conditions could not exist. The farmer is necessarily under some 
 pressure to sell after he has brought his bale to town. If he does not 
 do so he has lost a day's time, and has no assurance that his next at- 
 tempt to sell will be productive of better results. Furthermore, he is
 
 108 HOW FAEMERS CO-OPERATE AND DOUBLE PROFITS 
 
 not well enough versed in cotton grading to know exactly what his bale 
 ought to bring, or whether the price offered is a fair one. 
 
 "The conclusion is irresistible that the burden of the great discrep- 
 ancies in the prices paid for each standard grade must fall most heavily 
 upon those producers who are most ignorant of cotton grading and 
 who are under the greatest pressure to sell." 
 
 VII 
 
 The two supreme facts brought out in this remarkable 
 study of cotton marketing in Oklahoma — and the conditions 
 there are typical — are : 
 
 (i) That farmers marketing individually have no guar- 
 antee that they will receive the value of their lint. Perhaps 
 a few farmers in the cases just mentioned did receive a little 
 more than their grade justified, but we all know that buyers 
 are too intelligent for this to happen often. The conclusion 
 is, therefore, irresistible that if the highest prices were only 
 just about right, the lowest ones were grossly unjust to the 
 growers — amounting almost to sheer robbery of the 
 ignorant. 
 
 (2) The farmer does not get the benefit of the higher 
 prices he should receive for grades above middling. This 
 fact is emphasized and re-emphasized in the bulletin from 
 which we are quoting. "The cotton trade in Oklahoma," we 
 are told, "recognizes no grade above good middling, although 
 many thousand bales of higher grade are produced. In 
 some cases the bulk of the cotton is bought as middling for 
 weeks at a time, when a large majority of the bales are 
 actually above that grade." Note this language — "a large 
 majority of the bales" for weeks at a time above 
 middling, when middling price is the highest the farmer 
 gets! The conclusions of the whole matter are set forth 
 by the authors of this bulletin in the following language : 
 
 "The greatest losses to the farmers under the present system of 
 marketing appear to lie in their failure to secure the premium for their 
 high grades which these bales finally bring. No reHef from this con- 
 dition can be expected while grading is wholly in the hands of the
 
 BETTER PRICES FOR COTTON AND COTTONSEED 109 
 
 buyers. As long as this is the case, the cotton will never be closely- 
 graded until after it has left the grower's possession. Co-operation 
 among growers, if properly organized, would probably furnish some 
 measure of relief, but under present conditions a rather expensive 
 selling department would probably be necessary." 
 
 VIII 
 
 But the cotton farmer's loss does not stop with the lint. 
 He also loses untold thousands of dollars every year 
 through lack of system in marketing his cottonseed. Abun- 
 dant proof of this fact is found in reports sent the writer by 
 farmers in various parts of the South as to cottonseed prices 
 on Saturday, November 29, and Monday, December i, 1913. 
 
 A glance at these reports will prove interesting. Letter 
 No. I came from a farmer who said: "Our neighbors 
 clubbed up and sold 5,000 bushels at $33.33% per ton, or at 
 50 cents per bushel. Co-operation, you see." 
 
 The next letter came from A. C. McAnally, Cleveland, 
 Ala., who said : "Cottonseed are worth $25 a ton here to- 
 day at the wagon." 
 
 Mr. G. W. Wilson of Mt. Pleasant, S. C, wrote : "The 
 Sea Island Cotton Oil Company of Charleton is paying $30 
 per ton for seed today, and they furnish sacks free and 
 deliver them at gin." 
 
 This came from Mr. F. B. Cameron, McKinney, Texas: 
 "The oil mill and gins here are paying the farmers $20 per 
 ton. The gins pay the farmers just as much as the oil mill 
 and haul the seed. It looks like a 'stand in.' Surely the 
 gins cannot afford to do the hauling and sell for the price 
 the mill pays the farmer. I think we farmers need a little 
 co-operation in this seed business; also in the lint cotton." 
 
 Mr. G. T. Gresham, Eulonia, S. C, was next, naming the 
 price there $30 a ton. 
 
 The same price was reported by Mr. L. C. Holler, David- 
 son, N. C. 
 
 The very next letter was from W. C. Andrews, Grady, 
 -Ark., who said: "We have been getting $16 per ton for
 
 110 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 about a month. Both gins buy seed but have no competi- 
 tion. No provision is made for disposing of it except when 
 ginned," 
 
 With variations from $i6 to $33 a ton, it is clearly high 
 time for farmers to co-operate in selling cottonseed, as well 
 as cotton. 
 
 IX 
 
 What is needed is a co-operative farmers' warehouse in 
 every market of sufficient size in which farmers can store 
 their cotton, have it graded by an expert grader, and sell it 
 on special days in 100 to 500-bale lots, getting representa- 
 tives of the cotton exporters, and cotton mills, if possible, 
 to attend. If it is too expensive to keep a warehouse just 
 for cotton, make it a storehouse for fertilizers in spring and 
 rent space for other purposes in other seasons. Or if there 
 is no warehouse, organize the farmers and let all members 
 of the organization market together one or two days in 
 each week. 
 
 Somewhat more elaborate are the views of Judge Lind- 
 sey of the Texas Farm Life Commission, He believes, as 
 the writer has advocated, that there should be co-operative 
 cotton gins as well as co-operative cotton warehouses, and 
 goes on to say: 
 
 "On the same plan that gins are organized, but on a larger scale, 
 organize or reorganize warehouses. Say there are thirty co-operative 
 gins in a county; all these associations should join together in a 
 warehouse association. At the time cotton is stored it should come 
 tinder insurance protection carried by the warehouse association, and 
 each bale should be carefully and correctly weighed, graded and given 
 a warehouse number, all of which should be entered on the books 
 of the warehouse and on the receipt issued to the owner of the cotton. 
 With this information the owner and holder of the receipt can readily 
 follow the values of his cotton from day to day by the market reports 
 and sell when he so desires by merely transferring his receipt." 
 
 The number of buyers who must be supported under the
 
 BETTER PRICES FOR COTTON AND COTTONSEED 111 
 
 present system of selling also makes the buyer's margin of 
 profit absolutely excessive. We have already commented 
 on the veritable army of cotton buyers in Memphis, Tenn., 
 as an example of the wastefulness of present methods. 
 
 When the writer was in Minnesota he found that through 
 co-operative live stock selling the stockmen there are now 
 supporting only one buyer to the town (and he is the 
 farmers' own man responsible to them for his actions) in- 
 stead of four or five buyers as previously, responsible to no 
 one. When will our cotton farmers learn the same lesson ? 
 
 X 
 
 Finally, we may summarize our conclusions by saying: 
 (i) No cotton should be allowed to lie out in the weather. 
 You will be sacrificing $io in grade for every $i you im- 
 agine you will gain in weight. 
 
 (2) The present system of individual selling of cotton 
 must go — "everybody for himself and the devil take the 
 hindmost." There are too many of the "hindmost" who 
 catch the gentleman aforementioned; and there are too 
 many unnecessary middlemen to support. Cotton farmers 
 must organize to sell co-operatively on special days and in 
 large quantities. 
 
 (3) They should have their cotton graded by an expert 
 and impartial grader. 
 
 (4) They should see to it that they get the benefit of 
 higher prices for grades above middling as well as bear 
 the losses on grades below middling. 
 
 (5) Especially in long-staple cotton is careful grading of 
 the highest importance. 
 
 (6) Farmers should get reports of what all available 
 market towns are paying and find out whether in any of 
 them prices are being held down by a buyers' "trust," act- 
 ing without competition. In such cases they should appeal 
 to the business men and commercial bodies of the town
 
 112 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 !j 
 
 for help. These business men will realize that such methods 
 will cause farmers to boycott the town and hurt trade. 
 
 (7) Farmers and tenants should be encouraged to have 
 their bills fall due in two or three payments instead of hav- 
 ing to settle everything around November i. 
 
 (8) The same co-operation recommended for practice in |( 
 selling lint should also be observed in selling cottonseed, 
 and the co-operative warehouse should handle both lint 
 and seed. 
 
 (9) These and other plans should be discussed in your 
 Farmers' Union or other farmers' organizations ; and if the 
 farmers are not organized in your community, this will 
 be a good object to organize them on. Farmers fighting 
 single-handed can never bring about the reforms needed 
 for their relief.
 
 CHAPTER XIII 
 
 A $5,000,000 TRUCK MARKETING ASSOCIATION 
 
 IN VIRGINIA 
 
 A First-Hand Account of the Famous "Eastern Shore Produce 
 Exchange" — Averages a Carload of Potatoes for Every 
 Hour in the Year — A Wonderful Business Organization 
 Which Maintains Agencies in All the Great Centers and 
 Has Lessons for Co-operative Societies Everywhere. 
 
 I RECKON that's the court house," said Professor 
 Camp to me as we walked through the little town of 
 Onley, in the eastern shore of Virginia, and came in 
 sight of the handsomest building in the place. But it 
 wasn't the court house at all. It was the home office of 
 the "Eastern Shore of Virginia Produce Exchange," as a 
 large sign across the front quickly informed us. 
 
 The building itself is pretty tangible proof that this idea 
 of co-operative marketing is getting in the air, and not only 
 getting in the air, but getting very substantially rooted 
 in the good earth of everyday business. And the proof is 
 even more convincing when I say that from this building 
 this Eastern Shore Produce Exchange handles about $5,000,000 
 worth of business annually, shipping on an average more 
 than one carload of potatoes for every hour in the year. 
 
 How the Exchange grew to such proportions is naturally 
 the reader's next inquiry. And the answer is in part that, 
 like Rome, it was not built in a day. "You seem to have 
 had a rather easy history," I said to Secretary-Treasurer 
 A. J. McMath as I began talking with him. But he was 
 quick to reply that Jordan had been a hard road to travel 
 for the Eastern Shore Exchange as well as for nearly all 
 farmers' marketing organizations, and that it had in fact 
 
 113
 
 114 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 come up through great tribulation. The organization was 
 born out of the poverty and disappointments of these 
 Eastern Shore Virginia farmers — it is limited to Accomac 
 and Northampton counties, in the Cape Charles peninsula 
 north of Norfolk — in 1899. As a result of several meetings 
 held that year a committee of twelve framed recommenda- 
 tions for a marketing organization, and it was finally in- 
 corporated January 6, 1900. Shares were fixed at $5 each, 
 and in order to make it easy to get members, any white 
 grower was authorized to take stock by paying 25 cents 
 down, the remaining $4.75 to be paid by the end of the year. 
 By August $3,500 had been paid in, and the first season's 
 volume of business proved, on the whole, pretty satisfactory. 
 
 "The system of marketing before the Exchange came 
 was, in fact, just about as bad as it could well be," Mr. 
 McMath remarked to us. "The local buyers who took 
 the farmers' produce found it to their interest to force 
 prices as low as possible. Ten cents a barrel was the usual 
 commission allowed them by the employing houses, and the 
 lower the price at which they bought, the more barrels they 
 could buy and the quicker they could turn over the money, 
 and the better pleased were employing officers." 
 
 To put it in a nutshell, for every Exchange employee 
 the farmers are now supporting, employed by them to get 
 the best possible prices for them, the farmers were then 
 supporting six to ten times as many local buyers, whoso 
 activities inevitably resulted in forcing the lowest possible 
 prices on them. 
 
 The first big fact to consider about Eastern Shore Ex- 
 change methods is that it does not consign the farmers' 
 products, leaving the commission merchant to report later 
 what were the prices received, but fixes prices by wire 
 before making shipment to the buyer; and the farmer 
 knows the very next day how much per barrel his potatoes 
 will fetch him. 
 
 Secondly, the Exchange with its 2,500 stockholders and 
 1,000 additional patrons, controls 75^0 of the potato crop
 
 A $5,000,000 MARKETING ASSOCIATION IN VIRGINIA 115 
 
 of the two big potato-producing counties of Accomac and 
 Northampton, so that commission merchants can place 
 orders with it, confident that they will be filled, and reason- 
 ably certain that the prices paid by them represent actual 
 and stable market values. 
 
 Thirdly, the Exchange inspects every shipment, putting 
 its registered "Red Star" trade mark on every shipment 
 of No. I quality, so that buyers call for the "Red Star 
 Brand" and are willing to pay a shade more for it. 
 
 The largest and most reputable produce houses North, 
 East and West, therefore, had rather buy from the Ex- 
 change, even when other Eastern Shore agents wire them 
 the same prices, (i) because they know that with its big 
 business the Exchange will be surer to fill their orders, 
 and (2) because the Exchange guarantees quality as 
 represented. 
 
 In order to explain more readily the Exchange's method, 
 let us describe a typical day's work in the shipping season. 
 The first thing the officers do is to 'phone the Exchange's 
 forty-three agents, the men employed to represent at forty- 
 three shipping points scattered all over the two counties, 
 and find out just how many cars will be offered for ship- 
 ment. Oak Hall, say, will report three cars "Star brand," 
 Tasley one or two unbranded, Onley five cars "Star," and 
 so on and so on. Then the totals are footed up, and it is 
 "up to" the Exchange to sell them for the growers. By 
 8 or 9 o'clock telegrams report the prevailing New York 
 prices — and New York prices, of course, determine prices 
 in a considerable area around New York. If New York 
 prices are low, then the Exchange may wire its agents in 
 Chicago, Pittsburg, Toronto and Scranton (a regularly em- 
 ployed agent of the Exchange is kept all the time in each 
 of these places as well as in Boston), and the Exchange 
 officials will also wire as many jobbers in other cities as the 
 size of the day's business seems to require. Perhaps the 
 telegram will read: "We offer you today one car Red
 
 116 HOW FAEMERS CO-OPERATE AND DOUBLE PROFITS 
 
 Star $2 barrel." Perhaps a number of orders will be wired 
 back at this price, but some jobbers will reply: "Cannot 
 pay $2 here, but will take two cars at one ninety." By 
 I or 2 o'clock the Exchange officials have wired directions 
 for shipping most of the cars, and they also know whether 
 or not all the cars can be sold at the $2 rate. If all cannot 
 be sold at this figure, some orders may be filled at $1.90, 
 or perhaps some may have to be sold at $1.85, in markets 
 where local conditions will not justify the higher price. 
 
 Nevertheless, it would be manifestly unfair to pay one 
 farmer $1.85 and another $2, when both had brought to 
 Exchange officials the same grade of potatoes and at the 
 same time. Therefore, it is the custom of the Exchange 
 to pool prices or to average them so that on each day's 
 shipment all farmers will get the same price for the same 
 grade of product. If, for example, five cars are sold at 
 $1.90 and five at $1.70, the price paid both classes of shippers 
 will be $1.80. Of course, some growers produce an extra 
 fancy product, however, which commands superior prices, 
 and in such cases they get a corresponding premium above 
 the average paid for standard grades. 
 
 And the Exchange does a big business not only in num- 
 ber of barrels handled and in money turned over, as we have 
 already indicated, but also in territory served. Let us take 
 a look at the shipping books for July 15, 1913 — a rather 
 small day's business, it is true, but one which will illustrate 
 the range of distribution. Three cars were sold to South 
 Bend, Ind., six to Toronto, six to Providence, three to Bos- 
 ton, five to Detroit, twenty to Pittsburg, three to Worces- 
 ter, two to Portland, five to Scranton, and one each to 
 Allentown, Dayton, Hartford, Trenton, Newark, Roches- 
 ter and Carbondale. 
 
 Frequently the Exchange's sales, in a single day, will reach 
 a total of two hundred carloads, and the record day's sales, 
 made last season, was about three hundred and twenty-five 
 cars of Irish potatoes. With this volume of business the
 
 A $5,000,000 MARKETING ASSOCIATION IN VIRGINIA 117 
 
 geographical distribution is much wider; and in the sweet 
 potato season the association sells from Portland, Me., to 
 Tampa, Fla., and as far west as the cities of the Rocky- 
 Mountains. 
 
 Under the old system of selling, the Eastern Shore farm- 
 ers were systematically fleeced (and we seem to have 
 heard that farmers in unorganized sections are still sys- 
 tematically robbed) by dishonest commission merchants 
 who report, "Market glutted since you started your ship- 
 ment; prices all off," the commission merchant proceeding 
 to make settlement accordingly ; or perhaps the report will 
 be, "Your shipment reached us in bad condition ; will com- 
 mand only one-half or two-thirds regular market price." 
 And in such cases, what redress has the small unorganized 
 trucker? He cannot afford to make a trip to New York 
 or Buffalo or Chicago, as the case may be, to see whether 
 the r€port is correct or not. He must take what is offered. 
 
 But the unfaithful produce dealers have long since learned 
 to play no such fantastic tricks before the Eastern Shore 
 Exchange. In the first place, the Exchange has regularly 
 employed representatives in a list of cities we have already 
 given (and in sweet potato season a man in Kansas City 
 and another in Cincinnati), and any of these agents will 
 immediately investigate any trouble that is reported with 
 any Eastern Shore shipment in his particular city. Or 
 if trouble is reported in' any city where the Eastern Shore 
 has no agent, there is usually one of these agents near 
 enough by to run over and get justice for the shippers if 
 the matter cannot be arranged by wire. Of course, after 
 fourteen years' experience in the business Mr. McMath 
 knows there are certain dealers whose word he cannot take. 
 He also keeps a sharp eye for the financial standing of 
 every man to whom a shipment is made — as was indicated 
 by the big copies of Dun and Bradstreet at his hand as we 
 talked, each twice as big as an old Unabridged Dictionary — 
 and he told me that he did not lose a dollar by selling to 
 any financially unsound dealer last year.
 
 118 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 Nor are the members of the Eastern Shore Exchange the 
 only ones who benefited by its activities. "If local men beat 
 down the price at some place where we are not strongly 
 organized," Mr. McMath told me, "we may go there 
 and buy for our protection. Here's a case in point: On 
 one occasion when potatoes had been selling the day before 
 for $2.50 a barrel, the local buyers put out word that the 
 market had broken and that $1.75 was the best price to be 
 had. We found it out, put our buyers there buying shipments 
 at $2.50 and before night the price had advanced to $2.75 !" 
 
 "What system have you for inspecting your products so 
 as to keep up the reputation of the 'Red Star' brand?" was 
 one of the next questions we fired at Mr. McMath. 
 
 "An inspector is employed at every shipping point," was 
 his reply. "He is required to examine one package in every 
 five, but if a shipper with a bad reputation should show up, 
 the inspector might examine half of his offerings. Then, 
 too, you must remember that every barrel which bears the 
 Red Star brand of quality also has the grower's mark on it 
 — either his initials or some other mark of identification. 
 For example, suppose a bad lot of potatoes should get by 
 the inspector and complaint should come back to the Ex- 
 change. 'What were the initials on the barrel?' I would 
 ask. Suppose the reply should be 'B. T. F.,' for example. 
 Very well ; I would call up the inspector at the point of ship- 
 ment and tell him to be more careful about B. T. F. thereaf t-er." 
 
 I then put this question: "But, suppose there should be 
 continued complaints against B. T. F. ; would you fire him 
 from your membership?" 
 
 Mr. McMath's reply was characteristic : "Well, the first 
 man we would fire," he answered, "would be the inspector 
 himself! It's his job to keep poor stuff from getting in 
 with first-class stuff." 
 
 But any unscrupulous grower has learned long since that 
 it doesn't pay to try to pack off an inferior product on the 
 inspector. If he does, he may wind up by having his whole
 
 A $5,000,000 MARKETING ASSOCIATION IN VIRGINIA 119 
 
 shipment go out unbranded, whereas with honest grading- 
 all the better part would get the advantage of "Red Star" 
 quality prices. A chief inspector has general oversight of 
 the local inspectors and does much to keep grading uniform 
 and to remind inspectors that the Exchange, like England at 
 Trafalgar, "expects every man to do his duty." 
 
 Finally, we come to a consideration of the business prin- 
 ciples upon which the Exchange is conducted. The Ex- 
 change, in fact, is one of these enterprises operated partly 
 upon capitalistic and partly upon co-operative lines — a sort 
 of institution of which we shall necessarily have thousands 
 of examples while the co-operative idea is getting itself 
 understood, and a greater or smaller number probably for the 
 rest of the time. The ideas of "patronage dividends" and 
 "one man, one vote," had not been much heard of in the 
 South when the Exchange began business fifteen years 
 ago; and it has been necessary, therefore, to graft some 
 new ideas on it and yet not wholly destroy the present stock. 
 
 Up to four years ago all dividends had been paid on 
 stock and there had also been trouble on account of some 
 of the larger stockholders transferring their shares at op- 
 portune times for electing local agents, etc. Accordingly 
 a rebellion arose — a rank, bitter, riotous sort of rebellion 
 such as nobody else can equal farmers for raising. The 
 rebels wanted patronage dividends and the "one man, one 
 vote" principle. 
 
 The final result was a sort of compromise. The bigger 
 stockholders maintained that they bought stock with the 
 understanding that they would have one vote for each share 
 — that was, in fact, a requirement of the Virginia law at the 
 time — and that all dividends would go to stock. So an 
 arrangement was voted whereby a 10 per cent dividend is 
 declared on stock, and of the remaining surplus one-half 
 is divided up among all the shippers in proportion to the 
 quantity of produce shipped — as a patronage dividend — and 
 the other half is carried to the surplus or reserve fund of 
 the Exchange.
 
 120 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 But certainly lo per cent is as much as any such con- 
 cern should pay on stock, and as soon as the surplus be- 
 comes large enough to insure the Exchange against a 
 season of bad years, not merely half but all profits above 
 10 per cent on stock should go as patronage dividends. 
 
 It should be added, however, that the accumulation of a 
 surplus fund soon raised the actual value of the Exchange's 
 stock above its par value, and that the price was raised 
 accordingly. At present, with a capital of $41,780 (par 
 value), the association has $108,000 surplus, and stock is 
 issued only at $15 per share; so that the nominal 10 per 
 cent dividend means only about 3% per cent on a new 
 stockholder's money. Moreover, the amount required to 
 pay this dividend (only a little over $4,000) is insignificant 
 in comparison with the Exchange's present annual business 
 of four or five million dollars. 
 
 The Exchange, of course, "does business on business 
 principles," as a time-worn but necessary phrase puts it; 
 has always been willing to pay good salaries to get efficient, 
 capable men ; and uses the most systematic and up-to-date 
 methods of carrying on its business. We found the books 
 remarkably simple and well kept; they are regularly 
 audited by some of Virginia's best accountants, and any 
 stockholder can take a look at them whenever he feels like it. 
 
 Moreover, while the idea of patronage dividends was not 
 abroad in the land at the time the Exchange was organ- 
 ized, things were even then so arranged that the profits 
 would be distributed with some rough approximation to 
 equality. It has always been against the rules for any one 
 man to own as much as one-tenth of the stock, and most 
 of the 8,350 five-dollar shares (total capital stock, $41,750) 
 are held in blocks of one to five. All told there are about 
 2,500 stockholders. 
 
 It should be remembered, however, that the Exchange 
 handles business not only for these 2,500 stockholders, but 
 also for about 1,000 non-members who have "shipping
 
 A $5,CXX),000 MARKETING ASSOCIATION IN VIRGINIA 121 
 
 privileges" in it. Any white man, at any time, can buy 
 one share of stock at its cash value and become a member 
 of the Exchange. White farmers who do not care to do 
 this, or negroes who wish to use the Exchange, may never- 
 theless have their products handled by it by paying $i 
 apiece for a "shipping privilege" and agreeing to have all 
 their produce handled by the Exchange. The last named 
 requirement is imperative. No man can ship today through 
 John Smith and tomorrow through the Exchange. If this 
 were permitted the managers would never know what busi- 
 ness to count on. The only exception to this rule is that 
 if local buyers at any time offer unjustifiably high prices 
 for a product in order to get trade away from the Exchange, 
 its officials may direct the farmer to take them up. "These 
 buyers can't keep it up long," is the argument, "and we are per- 
 fectly willing to give them plenty of rope to hang themselves." 
 
 Another significant advantage of co-operation was 
 brought to light in the course of our investigation of the 
 Onley Exchange. Year before last, just about ten days 
 before its members would finish shipping their potatoes, 
 it was discovered that the New Jersey potato growers just 
 north of them were themselves about to start bumper ship- 
 ments to Northern markets. With the Eastern Shore Ex- 
 change and the New Jersey growers both shipping heavily 
 at once, prices would naturally have gone to pieces, prob- 
 ably selling low throughout the rest of the season. But the 
 Exchange officials sent word to the New Jersey marketing 
 societies, "Please hold off ten days till we can get through 
 and it will be better for both of us." And so it worked out, 
 whereas without organization the New Jersey growers and 
 the Eastern Shore Virginia growers would simply have cut 
 one another's throats, financially. 
 
 Of course, the Exchange doesn't satisfy everybody. I 
 found one man who was very badly dissatisfied with it. 
 But after he had expressed himself vigorously and pic- 
 turesquely, swearing that some of the inspectors wouldn't 
 know how to hitch up a plow horse, and that farmers should
 
 122 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 do their own shipping and not have any confounded Ex- 
 change inspectors monkeying with their produce, I asked 
 him how many barrels he shipped through the Exchange. 
 And then it developed that he wasn't a farmer at all, but 
 a sort of gentleman superintendent of the universe. Have 
 you ever noticed that those who won't work and are failures 
 themselves always take great pleasure in abusing those who 
 do work and succeed? Nor have I yet had it explained to 
 me why it matters much whether a potato inspector can 
 hitch up a horse or not, provided he knows potato inspect- 
 ing from A to Izzard. 
 
 "You know how it is," our grumbling citizen called to a 
 farmer acquaintance who was listening to him. "What did 
 you get for your potato crop last year?" 
 
 "Well, I didn't get but $i8 last year for my Irish potatoes, 
 as you know," was the reply, "but in trucking you will have 
 a spell of tough luck every now and then. But I have 
 studied my business enough to know that if I were to quit 
 the Exchange I'd lose nine times out of ten." 
 
 The rest of my story can be quickly told. The general 
 manager of the Exchange, co-laborer with Mr. McMath, is 
 Mr. W. A. Burton, and the business of the company is con- 
 ducted by these two men and a corps of young associates — 
 a more general supervision over its affairs being exer- 
 cised by a board of thirty-three directors. One director 
 and a local executive board is elected by each of the thirty- 
 three local divisions of the Exchange. 
 
 All in all, the "Eastern Shore of Virginia Produce Ex- 
 change" is a great experiment in farmers' co-operative mar- 
 keting, and while we might wish that it worked a little more 
 fully on the basis of patronage dividends and "one man, 
 one vote," we are reminded of Josh Billings's saying: "It 
 ain't no use to argy ag'in a success !" 
 
 And the Eastern Shore of Virginia Produce Exchange 
 is certainly a success !
 
 CHAPTER XIV 
 
 A NORTH CAROLINA COUNTY CO-OPERATION 
 
 HAS WAKED UP 
 
 The Catawba Farmers Started with a Co-operative Creamery, 
 and Now Have Co-operative Egg Collecting, Fire Insur- 
 ance, Potato Marketing and a Farmers' Building and Loan 
 Association — Farm Women's Clubs an Important Factor — 
 A Co-operative Laundry Is in Prospect. 
 
 CATAWBA COUNTY, North Carolina, is the finest 
 example in the South — so far as I know — of what 
 co-operation will do for a community, and the 
 heart and center of the movement in Catawba is 
 the "Catawba Co-operative Creamery Company." 
 
 This creamery, whose new building was recently dedi- 
 cated, was organized June i, 1910. A statement of its 
 progress since that time is given in the following table : 
 
 Number of patrons when organized 38 
 
 Number of cream patrons now 204 
 
 Number of egg patrons, about 400 
 
 Amount paid for butter fat (first year) $14,868 
 
 Amount paid for butter fat (second year) $22,015 
 
 Amount paid for butter fat (third year) $32,638 
 
 Details of business for the year just ended: 
 
 Total sales $51,935 
 
 Egg sales $16,431 
 
 Cream sales $10,390 
 
 Pounds of butter made 99,917 
 
 Number dozen eggs received 78,579 
 
 Average price paid for butter fat for the year, 30c. per pound. 
 Average price paid for eggs for the year, 21c. per dozen. 
 
 It will be noted that this is a combination creamery and 
 egg-collecting society; and it is going to do a number of 
 other things before getting grown. The Catawba people 
 
 123
 
 124 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS ' 
 
 j 
 
 have the right idea in thinking that when they have the «| 
 machinery for a business perfected, they might as well use j 
 this machinery for all it is worth. They hadn't been run- i' 
 ning two months before they found out that they had started j^ 
 with too small a number of cows (300) to make the busi- j] 
 ness pay unless they took on some side line. So they t^ 
 got together and decided that the wagons that were col- !^ 
 lecting the milk from the patrons might as well collect their ' 
 eggs also; and this is what they proceeded to arrange for. j 
 
 The net result of both activities is that the farmers have i 
 received from one to four cents a dozen extra profit on their J 
 eggs by working co-operatively; and they have received 
 about twice as much for their creamery butter as they would 
 have received for ordinary farm butter. As I write this, the 
 creamery butter brings from 30 to S7 cents a pound, while 
 ordinary farm butter is sold for from 15 to 20 cents a pound. 
 
 Moreover, the creamery, which started with $1,500 capital 
 stock borrowed from the bank ($1,000 being spent for 
 equipment, while a building was rented in which to conduct 
 the business), now has equipment worth $3,500 and their 
 new building is worth $3,500 and lot $1,500. 
 
 i 
 
 i- Perhaps the chief reason why this creamery has suc- 
 ceeded so notably while many other southern creameries 
 have failed ,is that the Catawba creamery is operated 
 squarely on the co-operative principle. Each patron is ex- 
 pected to take one or more shares of stock at the par value 
 of $10, but on this he receives only 6 per cent interest, all 
 the profits being divided among patrons in proportion to 
 the amount of business furnished. At one time profits 
 were allowed to accumulate for some time, so that at one 
 meeting the stockholders found an accumulation of $1,000 
 in profits in the treasury. Now, however, the plan is to 
 pay every member at the end of each month the exact 
 amount realized from his cream or eggs, less the necessary 
 deduction for the management and upkeep of the business. 
 In other words, the patron not only gets paid cash for his 

 
 NORTH CAROLINA COUNTY CO-OPERATION HAS WAKED UP 125 
 
 products every month, but he gets a monthly dividend on 
 his investment in the shape of increased prices received for 
 his product, through co-operative marketing. 
 
 But, of course, not even the co-operative principle, or 
 anything else, would have enabled the Catawba creamery 
 to succeed without efficient, capable men in charge. If 
 most of the credit for starting the enterprise belongs to 
 Mr. J. A. Conover, certainly most of the credit for making 
 it a success belongs to W. J. Shuford, the wide-awake man- 
 ager, who combines practical business sense with vision 
 and enthusiasm. Mr, Shuford looks after the business of 
 buying and selling, collections, correspondence, etc., attend- 
 ing to all of this at a salary of $50 a month, in connection 
 with his other business interests. The butter maker at- 
 tends to making the butter, shipping and receiving cream, 
 pasteurizing, testing, etc., and has an assistant who acts 
 as bookkeeper. As usual, however, one finds back of a 
 good official a good board of directors. "We have nine 
 good men, three selected each year for a three-year term," 
 said Mr. Shuford to me, "and the great secret of success 
 is that they have worked consistently for the good of the 
 company, and with no desire to unload brothers or nephews 
 or special friends on the creamery." 
 
 Cream is collected three times a week at a cost of about 
 2J/2 cents per pound of butter fat. Six routes are conducted, 
 and I was told that each driver makes about twenty miles a 
 day. After the route is properly developed, the driver is 
 paid a regular salary. Until then he gets one cent a dozen 
 on all the eggs he collects; three cents a pound on all 
 butter fat, and a commission on the cream separators he 
 sells. 
 
 What I mainly wish to point out in writing this chapter, 
 however, is how progress in one line stimulates progress 
 in all lines. I do not think it is too much to say that the 
 success of this co-operative creamery has made Catawba 
 County a new county. The people have a confidence in 
 themselves that they never had before ; they have developed
 
 126 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 a business ability they never had before, and in the not dis- 
 tant future we shall doubtless have people from all parts 
 of the United States, and even from foreign lands, visiting 
 Catawba County to see an example of what the spirit of 
 co-operation will do for a farming community. The people 
 started with the co-operative creamery ; then they began to 
 collect eggs; now they have begun to ship poultry. A 
 farmers' mutual insurance association, of which about 1,500 
 Catawba farmers are members, has for years insured them 
 against fire at a cost of 15 cents on the $100. Moreover, 
 the creamery patrons buy fertilizer and feed in carload lots. 
 Latest of all is a Farmers' Building and Loan Association, 
 and before a great while they will doubtless have a co- 
 operative laundry in connection with the co-operative 
 creamery. A co-operative selling agency in connection with 
 the creamery is also being worked out — a sort of farmers' 
 exchange. 
 
 Moreover, from the Hickory creamery have gone out 
 waves of influence that have affected all the citizenship of 
 the county. A good county fair has been organized. A 
 wide-awake county commissioner of agriculture is regularly 
 employed. There are thirty-five local tax school districts 
 in the county, and two townships have voted $50,000 bonds 
 for road building. A county superintendent of schools 
 gives his whole time to the work. An appropriation for 
 the extermination of hookworm disease was made some 
 time ago, with the result that one county commissioner said 
 that it was the best money he had ever had a hand in 
 spending. 
 
 Altogether, therefore, one has only to breathe the air of 
 Catawba to get thoroughly charged with the electric spirit 
 of progress that is remaking the county. 
 
 Consider, for example, the new Farmers' Building and 
 Loan Association, perhaps the first thing of its kind in the 
 South. When Mr. Shuford called a meeting of men to help 
 organize it, he had present the president of the First Na-
 
 NORTH CAROLINA COUNTY CO-OPERATION HAS WAKED UP 127 
 
 tional Bank, the mayor, the manager of the Piedmont 
 Wagon Company, and other leading men who would not 
 have had any faith in the business ability of farmers five 
 years ago. At this meeting the following plan for the 
 association was adopted : 
 
 "The purpose of the Association is to combine the payments of the 
 members into a fund for making loans to each other, and for the pur- 
 pose of buying and improving lands, buildings and purchase of imple- 
 ments, machinery and stock, and for bettering conditions on the farm. 
 
 "The organization to be made under the building and loan law of 
 North Carolina, and to be managed by a board of directors who, with 
 a president, vice-president and secretary and treasurer, shall have sole 
 charge of the business, subject to such by-laws and regulations as the 
 stockholders shall adopt. 
 
 "All money received shall be placed in a general fund, from which 
 all loans shall be made on approved real estate security, or on the paid- 
 in value of their stock, installments and interest to be paid monthly. 
 The stock shall be issued with a par value of $100 payable in propor- 
 tionate installments, either monthly, quarterly or semi-annually." 
 
 Sooner or later a co-operative store will doubtless be 
 established also; and as I have intimated, plans are now 
 being developed whereby patrons who have anything to 
 sell will be brought into touch with any who wish to buy. 
 For example, if one farmer wishes to buy four or five pigs 
 or ten bushels of peas, he will be put into communication 
 with a farmer who has these to sell. 
 
 "And instead of sending North for breakfast strip and 
 having our townspeople pay 35 cents a pound for it," said 
 Manager Shuford, "we are going to arrange to keep this 
 money at home in the near future by doing meat curing 
 of the finer sort." 
 
 Another instance of the progressive spirit of the Catawba 
 people and of their new faith in themselves is found in 
 the organization of a sweet potato marketing association 
 to ship and sell Catawba's annual 300,000 bushel crop. 
 "We sent out a notice the other day," said Mr. Shuford, 
 "and promptly got sixty-five farmers to the meeting. A 
 few years ago not half a dozen would have come." This
 
 128 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 organization will not only undertake the marketing of the 
 sweet potato crop, but an effort will be made to get all the 
 farmers to grow just the type of potatoes demanded by the 
 northern market. In other words, it will seek not only 
 to save the middleman's profits, but also to get extra profits 
 through standardization and improved methods of grading. 
 
 The .Catawba folks are also making a determined effort 
 to have their farm schools train for farm life. The fact of 
 the business is that if anything is found anywhere in 
 Catawba County now that "hadn't ought to be" a wholesale 
 war is immediately declared against it, no matter how 
 ancient its title. More than this, the Catawba folks are 
 even going out of their way to find out whether any bad 
 conditions exist that they haven't known about. They are 
 now preparing to have a "rural survey" of the county and 
 have already made a survey of one or two school districts — 
 finding out such things as how many farmers in the district 
 read no papers, how many children are not going to school, 
 how many people in the district are not church members, 
 how many children in the district are attending college or 
 high school, etc. 
 
 Of course, a wide-awake people are not going to be satis- 
 fied with bad roads, and there is now great enthusiasm over 
 the sand-clay roads that are being built and which are better 
 in many respects than the macadam roads that cost three or 
 four times as much per mile. 
 
 The county's country schools are not kept open as long 
 as they should be, but here again the leaders are keeping 
 up a campaign of "agitation, irritation and education" for 
 better things. 
 
 In short, the Catawba folks have been waked up by co- 
 operation, they have been inspired by an ideal of just what 
 a farming county may be, and as Mr. Foster, the county 
 demonstration agent, said to me, "We are not going to let 
 anything stop us." 
 
 I met a lot of interesting men on my latest trip to Catawba 
 
 i
 
 NORTH CAROLINA COUNTY CO-OPERATION HAS WAKED UP 129 
 
 — men who are carrying on this creamery work and poultry 
 work, marketing work, etc., but the two most interesting 
 persons I met there were women : prophetic and significant 
 persons they were. These were Mrs. John W. Robinson 
 and Mrs. Gordon Wilfong, leaders in the two new clubs of 
 "United Farm Women" organized in Catawba. 
 
 No sort of movement for rural co-operation or for the 
 development of a greater rural civilization can win large 
 success unless it recognizes and makes room for the coun- 
 try woman; and it is also true that the men will never 
 organize the women. Our farm women must themselves 
 develop leaders for their own work. The inspiring fact is 
 that this is just what is happening in Catawba County. I 
 don't know when I have ever felt a keener joy in having 
 some hand in this organization of country life than I felt 
 as I talked with a young farmer's wife who has caught a 
 vision of the possibilities of organizing the country women, 
 and, as Mr. Foster would say, "is not going to let anything 
 stop her" until the result is achieved. 
 
 "We have pretty good conditions in our neighborhood," she 
 told me, "but I can never be satisfied simply to have the best 
 social conditions in my immediate community and the best 
 schools for my own children, if I know that other districts 
 in the county are yet wholly untouched by the new spirit. 
 I want to reach the stay-at-home woman who feels that 
 nobody wants her at a meeting. And the only way I know 
 to do this is to have a county meeting and get the women 
 in each school district who are interested to come and then 
 put on them the responsibility of reaching these other 
 women." 
 
 Finally, Mr. Farmer, Catawba is only a good illustration 
 of what your county might be if you would only get it 
 waked up. Why not wake it up?
 
 CHAPTER XV 
 
 WHAT CALIFORNIA AND FLORIDA CITRUS 
 FRUIT GROWERS HAVE DONE 
 
 Florida Growers Spend About $100,000 in Advertising and 
 Opening Up New Markets, Thereby Greatly Increasing 
 Prices and Profits — "California Fruit Growers' Exchange" 
 a Marvel of Efficiency — Central Organisation Advises, 
 Locals Act — Blanket Freight Rate an Important Factor — 
 Co-operation Cuts Cost Packing and Handling in Half and 
 Reduces Cost of Distribution to 5 Per Cent — Associations 
 Run Their Own "Orchard Supply Company." 
 
 NOWHERE have growers of agricultural produce 
 achieved greater success through organization 
 and co-operation than has been won by the 
 growers of oranges, lemons and grapefruit in 
 California and Florida. I have before me as I write this 
 a letter from Mr. L. D. Jones, general manager of the 
 Florida Citrus Exchange, in which he sums up the first 
 four years' activity of the Florida organization as follows : 
 "Four years ago Florida citrus fruits were comparatively 
 unknown outside of some of the larger markets and a por- 
 tion of the Southern states. Last season the Florida 
 Citrus Exchange oranges and grapefruit were sold in nearly 
 all the markets from Portland, Me., to Portland, Ore., and 
 from Detroit to New Orleans; the energetic advertising 
 campaigns that have been conducted by the Exchange, and 
 the superior manner in which the fruit was graded and 
 packed, extending their markets to this extent. It must 
 be understood that approximately $100,000 was spent in 
 advertising Florida fruits by the Exchange, at an infin- 
 
 180
 
 WHAT CITRUS FRUIT GROWERS HAVE DONE 131 
 
 itesimal cost to the individual grower. Again are the 
 beneficent results of co-operation in strong evidence. Dur- 
 ing this progress along lines mentioned, the prices of fruit 
 have steadily advanced; grove property has greatly en- 
 hanced in value, which has, as a consequence, strengthened 
 all lines of business in the citrus belt of the State. 
 
 "As evidence of the continually increased price from year 
 to year, the following audited figures are given showing the 
 average f. o. b. Florida prices per box : Four seasons ago, 
 $1.15; three seasons ago, $1.51; two years ago, $1.93; last 
 season, $1.96. 
 
 "Thus it will be seen that in the four years' existence of the 
 Florida Citrus Exchange that it has actually raised the 
 average net price per box 81 cents. The statement, then, 
 that grove property has been greatly enhanced in value, 
 and that all lines of business in the citrus belt have been, 
 greatly strengthened, can be readily understood." 
 
 It is in California, however, that the most remarkable 
 success has been won through the medium of the largest 
 business organization of growers in the United States — 
 the "California Fruit Growers' Exchange." For efficiency 
 it is to be compared with the Standard Oil Company. 
 
 The California citrus fruit industry, it should be noted, 
 has passed through all the trials of disorganization and 
 organization. Some years ago, for lack of a marketing 
 organization, a large part of the crop of oranges remained 
 on the trees in the summer. Residents there still recall 
 how the sight of golden harvests ungleaned everywhere 
 advertised the lack of an adequate distributing system. 
 The growers were at the mercy of the local buyers, who 
 divided the territory or fixed a maximum price. Twenty 
 years ago overproduction was feared, though California 
 had only 5,000 carloads of oranges to market annually. 
 Now that the growers have been organized, no difficulty 
 is experienced in distributing 45,000 carloads a year. 
 
 The organization of the citrus fruit industry began with
 
 132 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 the formation of local associations, the membership in 
 these ranging from four to 200. These local associations, 
 of course, could only sell to local buyers or to representa- 
 tives of distant buyers; and under this system, or lack of 
 system, no efficient distribution of the crop could be 
 secured. One association would not know but that another 
 might have already oversupplied the very market to which 
 it was preparing to ship. Moreover, they were likely to 
 glut the larger markets and undersupply many smaller 
 cities willing to pay better prices. 
 
 When local associations thus proved inadequate, some 
 of them federated and formed "The California Fruit 
 Growers' Exchange." Eighty per cent of the growers are 
 now organized into co-operative associations and 65 per 
 cent belong to this California Fruit Growers' Exchange. 
 It has handled during the last nine years $121,000,000 
 worth of products. 
 
 And now let us briefly describe the work of the local 
 associations and the general organization. 
 
 The local association grades and packs, and sometimes 
 picks the fruit of the members. Fruit of the same grade 
 is put together and each member receives his share of the 
 receipts, according to grades. Fruit of the best quality 
 is sold under the general brand of the central exchange 
 and also under the brand of the local. Thus a general 
 reputation for the fruit of the California Exchange is de- 
 veloped while at the same time the growers in each local 
 are encouraged to make the brand of their own particular 
 locality as famous as possible. 
 
 The 115 local associations working as indicated are 
 divided into seventeen district exchanges. The district 
 exchange orders cars for the locals and keeps a record of 
 all cars sent out, and each district exchange has one director 
 in the general State exchange. 
 
 Then the central exchange acts as a clearing house for 
 collecting telegraphic news of the trade, for receiving offers 
 
 <
 
 WHAT CITRUS FRUIT GROWERS HAVE DONE 133 
 
 for fruit, and for redistributing this information to all the 
 district exchanges. The central exchange, however, as we 
 should make plain in the beginning, does not sell a single 
 box of fruit. It simply provides at cost the facilities 
 through which 7,000 growers sell their fruit to jobbers at 
 distant markets. It employs banded agents to drum up 
 trade and to report price fluctuations and market conditions 
 in all the principal cities of the United States and Canada. 
 If a buyer makes an offer to one of these agents, he has 
 no authority to accept it, but telegraphs it to the central 
 exchange which in turn passes it on to the district ex- 
 change, and the district exchange to the local, which has 
 the particular brand of oranges wanted. The reply or 
 return offer is sent back to the agent by the same way. 
 Thus the agent acts only upon instructions from the shipper. 
 The reserved rights which the shippers have are defined 
 in contracts between the California Fruit Growers' Ex- 
 change and the local associations as follows : 
 
 "Each shipper reserves to itself the right to regulate and control its 
 own shipments, to use its own judgment, to decide for itself when and 
 in what amounts it shall ship; to what market it shall ship; where its 
 products shall be sold, and, except at auction points, the price it is will- 
 ing to receive, fully reserving the right of free competition with all 
 other shippers, including other members of this organization, unham- 
 pered and uncontrolled by anyone." 
 
 Thus it will be seen that the central exchange does not 
 try to control prices by "scanting" a market or by fixing 
 a minimum price in all markets. In the West it has the 
 field to itself. In the South and East it is in competition 
 with European and Florida fruit. The Exchange does not 
 try to obtain the profits which a trust gets from fixing 
 prices. It does, however, acquire the profits of controlling 
 prices by as even and wide a distribution of fruit as pos- 
 sible. No market is glutted and no market is undersup- 
 plied. The grower receives a better price for his fruit, 
 while the fruit is distributed at a decreased cost and the
 
 134 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 consumer obtains it at a lower price than formerly. 
 The local association has the complete power to deter- 
 mine the diversion and final destination of each car, and 
 of deciding upon the price which it is willing to accept for 
 each shipment. The Eastern Shore of Virginia Produce 
 Exchange, as readers know, practices the opposite method, 
 determining at the central office the destination of ship- 
 ments and all prices for the growers. 
 
 An arrangement which will doubtless surprise the aver- 
 age reader is this : The railroads have granted the Cali- 
 fornia Exchange a blanket freight rate; that is to say, the 
 same rate whether the fruit is shipped to Kansas City or 
 New York. Some cars may be stopped by telegram in 
 Arizona or New Mexico, if the prices are better in those 
 sections ; other cars may go on to Texas, or if prices are not 
 good there, they may be diverted to Kansas and Minnesota; 
 or they may be kept going on to Pittsburgh, New York or 
 to Toronto. The same freight rate obtains whether the 
 car finally stops in New Mexico or in Montreal. At any 
 point en route the car may be stopped or diverted. As 
 Prof. Harry Clark says : 
 
 "In the Los Angeles office there is a card index for every car, tell- 
 ing its brand and on what railroad it is being shipped and its destina- 
 tion. When a telegram is received stating that the people in a certain 
 city do not care for oranges, the clerk in Los Angeles steps to his card 
 catalog and finds what cars are headed for that market. At the same 
 time he has received a telegram that other cities are eager for oranges, 
 because the taste of certain cities, just like that of individuals, varies 
 from day to day. The manager telegraphs and catches the car headed 
 to the city which does not want oranges. Perhaps this car is 100 miles 
 from that city. He stops it immediately, has it switched on to another 
 train and sent to the city which does want it. In that way every box 
 of California oranges is sold where it is wanted at good prices and 
 losses are reduced to a minimum." 
 
 The fruit is sold either through orders received by agents 
 from jobbers or at auction in the large cities. A part of 
 the fruit is sold f. o. b. at an agreed upon price, subject to
 
 WHAT CITRUS FRUIT GROWERS HAVE DONE 135 
 
 inspection and condition on arrival; and part f. o. b, at a 
 certain price which is not subject to inspection on arrival. 
 When fruit is sold by the latter method a deduction from 
 the price is made for cash at the time of shipment. 
 
 One more important activity of the organized citrus 
 growers should be noted. The 115 local associations own 
 the stock in a $1,000,000 orchard supply company. This 
 company was organized because the price of box lumber 
 was almost doubled in one year. The company has bought 
 much timberland, manufactures boxes for the members 
 and in 1911-12 sold to the locals at cost $2,068,591 worth 
 of boxes, labels, tissue paper wrappers and general orchard 
 supplies. It has also handled as much as six tons of vetch 
 seed for members in a year. Through the co-operative pur- 
 chase of supplies the cost of packing oranges has been re- 
 duced from 60 cents or more per box, the amount charged 
 when the buyer packed the fruit, to an average cost of 33 
 cents per box, while the cost of packing lemons has been 
 reduced from $1 or more to an average cost of 60 cents 
 per box, A co-operative fire insurance company gives pro- 
 tection at remarkably low cost. "After six years," it is 
 said, "the losses are less than the actual premiums of regu- 
 lar fire insurance companies." 
 
 All the facilities provided by the central exchange or 
 district exchanges are also furnished at cost. In 1912-13 
 the total cost of distributing oranges and lemons to whole- 
 salers amounted to only 3.13 per cent on the f. o. b. Cali- 
 fornia returns, or less than 2}i per cent on the gross re- 
 ceipts. Just what an achievement in collective marketing 
 we have here is emphasized when we recall that as a rule 
 it costs the individual farmer in the United States from 
 7 to 20 per cent on the gross sales to market his crop to the 
 wholesaler. Since the formation of the Exchange the 
 cost of handling and packing has been reduced by almost 
 one-half. 
 
 One more remarkable fact about the Exchange is that
 
 136 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 its $16,000,000 to $20,000,000 business a year ago is trans- 
 acted with only $1,700 of paid-in capital. The local associ- 
 ations move the crop East on their own credit, the growers 
 either waiting for the cash returns until the money reaches 
 them from the jobbers or securing an advance from the 
 bank. 
 
 In conclusion, it is interesting to note the method by 
 which the Exchange is financed. An arbitrary assessment 
 for the cost of handling is determined at the beginning of 
 each year. This assessment is based upon estimated ship- 
 ments and upon the probable expenses, and includes such 
 items as salaries of agents, telegraphic services and legal 
 fees. The central exchange allots the amount of the assess- 
 ment each month upon each district exchange at so much 
 per box, based on the number of boxes shipped. An adjust- 
 ment is made of the surplus or deficit at the end of each year. 
 
 The central exchange, district exchanges and the local 
 associations are organized on purely co-operative principles. 
 The local associations and the district exchanges are either 
 stock companies with a fixed dividend or non-stock com- 
 panies with no dividends. The central exchange is a non- 
 profit corporation. It performs its services at their actual 
 cost and declares no dividends. There are no profits to 
 quarrel over. The local associations receive all the pro- 
 ceeds minus the assessment for running expenses, which is 
 prorated according to the amount of products marketed.
 
 CHAPTER XVI 
 
 AN ARKANSAS COTTON MARKETING 
 ASSOCIATION 
 
 How the Planters Around Scott, Ark., Got Together, Formed 
 the "Scott Cotton Growers' Association," and Marketed the 
 First Year 7,554 Bales of Cotton and <5j Carloads of Seed — 
 Profits Ranged as High as $5 a Bale on Lint and $4 a Ton 
 on Seed — Total Business Nearly Half a Million Dollars. 
 
 WHILE other southern farmers have been busy dis- 
 cussing- this or that plan of cotton marketing, the 
 planters of Scott, Ark., have been busy not dis- 
 cussing, but, in so far as they are concerned, 
 actually solving the difficulty. 
 
 Their solution of the best way to market the cotton crop 
 of their section was by the formation of "The Scott Cotton 
 Growers' Association." This association is composed of 
 twenty-four planters from the country immediately sur- 
 rounding the railroad station of Scott, Ark,, representing 
 30,000 acres of cotton. 
 
 The objects of the association as set forth in its constitu- 
 tion are : 
 
 (1) To produce cotton from pure seed; 
 
 (2) To secure uniformity in ginning; 
 
 (3) To sell cotton in even running lots; 
 
 (4) To deal as nearly directly with the mills as possible; 
 
 (5) To act in co-operation with the United States Department of 
 Agriculture toward accomplishing these objects, and to take such fur- 
 ther action as may be practicable to produce better cotton and improve 
 the prevailing methods of handling and marketing same. 
 
 The objects as set forth above sound like some of the 
 rules for good behavior in a book of etiquette ; and yet when 
 
 137
 
 138 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 one who is familiar with the cotton market stops to think 
 it becomes evident that these people have struck good and 
 hard at the root of many of the difficulties that we en- 
 counter. 
 
 In order that their object should not be a merely written 
 formula but an accomplishment in fact, these cotton farm- 
 ers went to work with a system and determination that 
 could only result in success. The first thing they did was 
 to build at Scott a sample room. Means for doing this and 
 for operating the association were provided for by the 
 fixing of a membership fee of 10 cents a bale from each 
 member, according to the number of bales shipped by that 
 member the year before the organization of the association. 
 In addition, each member agrees to pay a commission of 
 50 cents a bale for every bale handled by the association. 
 These assessments and commissions assured them sufficient 
 funds to warrant their employment of a secretary, whose 
 business it is to look after the affairs of the association. 
 
 The first business of the association was the securing of 
 improved seed. These were purchased in carload lots and 
 distributed to the members at cost. The association lays 
 down the rules for the ginning and baling of the cotton, 
 and thus having planted the same variety of seed and hav- 
 ing ginned and handled the cotton in the same way, it 
 became comparatively easy for the association to be as- 
 sured of uniformity in the cotton. Each farmer draws his 
 own sample and delivers it to the sample room, together 
 with a statement of the number of bales corresponding to 
 the sample. The buyer inspects these samples and buys 
 from the secretary the number of bales he desires. The 
 several planters furnishing the samples selected are notified 
 how and when to ship, and the secretary receives the pay 
 for the cotton and forwards to each planter his pro rata. 
 
 "What guarantee do you have that the cotton will come 
 up to the sample?" we asked Mr. Brown, the secretary. 
 
 His answer was : "We admit to membership only such 
 men as we believe will make up any deficiency in this
 
 AN ARKANSAS COTTON MARKETING ASSOCIATION 139 
 
 matter," The rock upon which so many associations of 
 this kind split is the failure of its members to properly 
 support it. They will live up to their agreement to ship 
 all their products through the association so long as the 
 association can secure them decidedly better prices; but 
 the moment the association's prices happen to fall near the 
 price offered upon the open market, they begin to figure 
 that they can save that 50 cents a bale, and so the next 
 thing that is known the amount of cotton handled by the 
 association is so small that it ceases to command the respect 
 of the buyers, and the result is another failure in attempted 
 co-operation. 
 
 The breaking up of associations of this kind by the buy- 
 ers is frequently accomplished by the knowledge of this 
 failing. The legitimate buyer has every reason to encour- 
 age such an organization, but there are many "free lances" 
 in the buying field, especially in that of cotton, who make 
 their largest profit by undergrading rather than from a 
 legitimate commission. Such men soon learn that an as- 
 sociation is rather inimical to their business, and the artificial 
 boosting of prices so as to induce its members to desert it 
 is not an uncommon and, we are sorry to say, is a frequently 
 successful, way of breaking up such an organization. When 
 asked what penalty the association inflicted for the violation 
 of the agreement to allow the association to handle all his 
 cotton, Mr. Brown answered : "We attempt to allow only 
 such men to join as we know will stick to their agreement. 
 We have dropped one or two for violating it." So the 
 penalty is immediate expulsion, and it is none too severe. 
 
 The association also handles the cottonseed of its mem- 
 bers, for which service it receives 50 cents a ton in com- 
 missions. The seed are sampled and weighed by the buyer 
 and owner at the owner's property, but are bought by the 
 association. By being in a position to handle and supply 
 both cotton and seed in large lots, both guaranteed as to 
 quality, the association is able to attract the attention of the 
 best buyers who are able to buy at less expense, and so are
 
 140 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 naturally able to offer better prices for the goods. On the 
 Other hand the association is in a position not only to know 
 the true grades of its goods, but to keep informed as to the 
 best markets. 
 
 The first year's business — 1913 — shows that the association 
 handled 7,554 bales of cotton averaging 521 pounds in weight. 
 This cotton was sold for an average price of 11.64 cents per 
 pound, f. o. b. the member's shipping point. The total price 
 realized for this cotton was $458,171.48. Of cottonseed they 
 sold 63 carloads — 1,388 tons — at an average price of $21.80 
 per ton, f. o. b., or a total of $30,176.07. In other words, the 
 association in the first year of its existence did a business 
 amounting to $488,347.55 — nearly half a million dollars. 
 
 The test of the value of any organization of this kind is 
 the amount it is able to earn for its members above what 
 they would have received for their product and over and 
 above that received by the member of the community who 
 is not a member. With the data at hand it is not possible 
 to give this in exact figures, but frequent instances came to 
 light during the season's operations where the association 
 sold cotton for from one-half to one cent above that received 
 for cotton of equal grade, raised in the community but han- 
 dled by the individual. In a number of other instances 
 when the home mills were paying $20 a ton for cottonseed 
 and these were the only markets for the man who was sell- 
 ing independently, the association sold seed for its members 
 outside the State for $24 a ton. 
 
 A premium of from $2.50 to $5 a bale on cotton, plus 
 freight and all of the ordinary charges of shipping, and a 
 similar premium up to $4 a ton on seed, it would seem 
 should be a strong enough inducement not only to hold 
 its membership, but to attract others. The commission 
 and membership dues, as compared with the ordinary 
 charges for shipping and selling cotton or cottonseed are 
 so small that they are practically negligible ; and yet they 
 have afforded the association ample revenues for operation. 
 
 But this association is only in its infancy, and has already
 
 AN ARKANSAS COTTON MARKETING ASSOCIATION 141 
 
 learned from its first year's experience how it can improve 
 its work. At first each farmer drew his own sample and 
 delivered it to the association sample room. Under these 
 conditions there was not that uniformity of samples which 
 would follow had these samples been drawn by one expert, 
 and, as a consequence, the cotton did not always come up 
 to the sample. This called for an adjustment and a mak- 
 ing good which, to say the least, was a disagreeable neces- 
 sity and one that the association has taken steps to avoid 
 another year by employing an expert cotton buyer to do 
 the sampling and grading. With this addition to their 
 working machinery the association will be in a position to 
 sell without the buyer even seeing the sample, and thus will 
 be able to extend the limits of its market to cover the whole 
 world. It is their desire, everything else being equal, to 
 deal with local buyers ; but they will thus always be in a 
 position to deal with the mills direct and so will be able to 
 force all other buyers not only to give them the maximum 
 price for their goods, but to treat them fairly in all other 
 respects. 
 
 There can be no doubt that while others have been dis- 
 cussing how to solve the problem of the best way to sell 
 cotton, these people have taken the first steps, and long 
 steps at that, toward doing it. As they gain more expe- 
 rience, improvements upon their present plans will no 
 doubt suggest themselves and be adopted ; but even with- 
 out these improvements they have a plan that is a long step 
 in advance of the old haphazard methods. 
 
 The officers of this association are : J. R. Alexander, 
 president; H. T. Brown, secretary-treasurer; J. R. Alex- 
 ander, Tom Fletcher, B. R. Costin, H. T. Brown and M. L. 
 Walt, directors.
 
 CHAPTER XVII 
 
 EVERY FARMER SHOULD JOIN A MUTUAL 
 INSURANCE COMPANY 
 
 A Mississippi Farmer Tells How He Is Paying a Non-Mutual 
 Company $11.66 Per Year for Each $1,000 Insurance, While 
 Mr. W. J. Shuford Reports That in a Farmers' Mutual for 
 Nine Years the Cost Averaged Only $1.50 for Each $1,000 
 Insured — $^.63 Average a Safer Rule, However — Farmers 
 Should Also Carry Accident Insurance and Live Stock 
 Insurance. 
 
 A FORM of co-operation that should never be over- 
 looked is that of mutual insurance. In a later 
 chapter on "What Co-operation Has Done for 
 French Farmers," we mention the great good the 
 farmers of France have achieved in this respect, and it is a 
 lesson our American farmers should take to heart. 
 
 Recently the writer received two letters from farmers in 
 the same State (Mississippi), complaining about the ab- 
 sence of farmers' mutual insurance companies in that State. 
 Farmer No. i said: "The writer, previous to 1910, was a 
 farmer in Maine for eight years, and during that time was 
 a member of the Patrons of Husbandry, which organization 
 in Maine has a mutual insurance association for the insur- 
 ing of farm property which was very successful, the cost 
 being almost nothing. Since coming to Mississippi I find 
 that the insurance rates are almost prohibitive, some com- 
 panies refusing to write farm insurance. I would like to 
 inquire if the farmers' organizations in the South have 
 anything of the kind." 
 
 Farmer No. 2 wrote with even greater emphasis as fol- 
 lows : "We are paying $35 a thousand for our farm insur- 
 
 142
 
 FARMERS SHOULD JOIN A MUTUAL INSURANCE CO. 143 
 
 ance covering three years. For a like amount of farm 
 insurance in Illinois we pay $17.50 a thousand. In other 
 words, the cost here is 100 per cent more. Now, who gets 
 the extra money and why are we submitting to such ex- 
 orbitant rates without kick? Isn't it about time the south- 
 ern land owners began to look this matter up with a view 
 to cheaper insurance?" 
 
 Knowing that the Farmers' Mutual Fire Insurance As- 
 sociation of North Carolina is one of the most successful 
 organizations of this kind in America, we brought these 
 inquiries to the attention of the president, who wrote the 
 author of this book as follows: 
 
 "We now have 19,724 members and $17,570,886 of in- 
 surance in force at the end of the last fiscal year. We had paid 
 losses during the year amounting to $43,438.17, and had on 
 deposit in the various branches $23,056.06. 
 
 "The average cost of insurance for all the branches per 
 year has been $3.63 on one thousand dollars. This low 
 rate is due to the fact that ours is a mutual insurance organ- 
 ization sure enough and not in name only. We do not 
 undertake the creation of a surplus to be divided among 
 policyholders or to put into stocks, bonds, buildings, etc. 
 Our paid officers are few and their salaries are quite modest. 
 For instance, there are only two officers for the state as- 
 sociation receiving salaries, and in the county branches 
 only the secretary-treasurer, who is really the manager for 
 his county, receives compensation. 
 
 "Each county branch is independent in the conduct of its 
 business and has no liability for losses occurring outside its 
 own territorial limits. A branch, however, may embrace as 
 many as three counties. 
 
 "When a person becomes a member of a branch, which he 
 does when he takes a policy of insurance, he pays $5 on 
 $1,000 (or at that rate for a less amount), and at the same 
 time pays an advance assessment into the protection fund. 
 After that only when there is a loss by fire, wind, or light-
 
 144 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 ning in his branch does he have to pay anything more. 
 Each branch is required to keep in its treasury one advance 
 assessment so that losses may be promptly met. Agents are 
 requested not to write over three-fourths of what is a con- 
 servative cash value on any property, and not to take any 
 risk where there is doubt as to the moral hazard or where 
 property is heavily mortgaged. Nor are agents allowed to 
 insure expensive dwellings that have been left by owners 
 to be occupied by tenants." 
 
 This letter gives notable information as to the mutual 
 insurance movement as it affects an entire State. As to 
 how one of the local branches of the same company has 
 operated, the following statement, sent us by Mr. W. J. 
 Shuford of Catawba County, N. C, in 1914, is illuminating: 
 
 "We have 2,268 members in the two counties (Catawba 
 and Burke) and $1,786,890 insurance in force. The man- 
 agement is invested in the hands of the president, vice- 
 president, secretary and treasurer, and a board of directors 
 of four in Catawba and two in Burke Counties, who are 
 elected for the term of one year. 
 
 "The president receives a salary of two dollars per day 
 and expenses for the time spent in the performance of any 
 work for the association. The secretary-treasurer is 
 paid a regular monthly salary, and devotes a good part of 
 his time to the business. 
 
 "There is a supervisor in each township who passes on 
 all the risks insured; and there is also a local agent who 
 gets a small commission. No property is insured for over 
 three-fourths of the actual cash value. The supervisor in 
 each township assists in adjusting losses in his township. 
 
 "No building is insured in any incorporated town that is 
 within 200 feet of the nearest building and its contents 
 must not exceed $1,500 in value. 
 
 "The losses occurring are paid by a pro rata assessment 
 on each member, and must be paid within sixty days from 
 date of notification. The assessments have been only 15 
 cents on the $100 annually since 1905."
 
 FARMERS SHOULD JOIN A MUTUAL INSURANCE CO. 145 
 
 The statement that assessments in Mr. Shuford's branch 
 had been only 15 cents a year on the $100, or $1.50 per $1,000 
 insured, as compared with a cost of $11.6673 for each $1,000 
 insured in our Mississippi friend's non-mutual company, 
 seemed to us too good to be true, and we wrote Mr. Shuford 
 to know if there was not some mistake in his figures. But 
 he answered that there was none. The average of $3.63 
 per year for each $1,000 insured, as reported for North 
 Carolina as a whole, however, seems much more a realizable 
 ideal in an average county. 
 
 In any case the letters just given should leave no doubt 
 as to how farmers may get lower insurance rates. If you 
 live in a county where a mutual fire insurance company 
 exists, join it. If you do not live in such a section, then 
 go ahead and organize your county. Then, if your county 
 alone does not furnish so large a company as you wish, 
 federate it with one or more adjoining counties. If you 
 have a county farmers' union or other county farmers' or- 
 ganization, bring up the subject at your next meeting; if 
 you have none, then call a meeting of leading farmers at 
 some convenient time just to consider forming a mutual 
 insurance company. Every farmer ought to have insur- 
 ance, and he ought to have it at a lower rate than the 
 regular companies give. 
 
 As for the importance of insurance, it should be enough 
 for you to think of the farm homes in your community 
 one by one and imagine the trouble half of the owners 
 would have in rebuilding if fire should destroy their homes. 
 
 We ought to have mutual accident insurance also, and 
 live stock insurance. The writer only last week, as this is 
 written, made a small contribution to a neighbor farmer 
 whose two mules were recently struck by lightning and 
 killed. Now it is a good thing for neighbors to help a man 
 in a case like this, but it is uncertain and unbusinesslike, 
 and the policy of asking for gifts is not one to be encour- 
 aged. In fact, thousands and thousands of farmers had 
 rather go into debt and work their way out rather than
 
 146 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 ask any man for a cent — and one cannot help but admire 
 such independence. At the same time, a man ought not to 
 have the risk of being thrown in want or debt by accident 
 of any kind — fire, storm, lightning or live stock disease, 
 sometimes meaning a struggle for years to get back to where, 
 the owner was before. Every farmer ought to carry insurance 
 against all these risks and it ought to be mutual insurance. 
 
 After the local companies are organized, however, it is 
 desirable to have them regularly inspected by the State 
 insurance commissioner. We are reminded of this by the 
 following letter from one State commissioner: 
 
 "I find that frequently among the people generally con- 
 ducting mutual associations intended solely for the benefit 
 of policyholders that there is an inclination to oppose and 
 even to resent official supervision. But any man who loves 
 his State and who will examine into the matter will find 
 that no honest association need fear supervision and that 
 it is only by supervision that irresponsible and dishonest 
 concerns may be eliminated and honest and responsible 
 concerns permitted to grow without being choked by 
 noxious weeds. 
 
 "Due to the fact that a number, of irresponsible and utterly 
 selfish men for their own benefit undertook to run such com- 
 panies in this State previous to the establishment of the in- 
 surance department, great injury was done to the cause." 
 
 It is certainly very foolish for co-operative companies 
 of any kind to object to thorough official inspection. It 
 will frequently happen that a perfectly honest man will 
 use very lax bookkeeping and accounting methods, and the 
 members have a right to know that he will be checked up 
 if this happens. 
 
 One important reason for the great success of the co- 
 operative stores movement in Wisconsin and Minnesota, as 
 the writer found last year, is the regular system of audit- 
 ing under the direction of the Right Relationship League, 
 and regular expert auditing should be a feature of every 
 co-operative enterprise.
 
 CHAPTER XVIII ! 
 
 I 
 MAKING FARMERS INTO BUSINESS MEN: HOW j 
 CO-OPERATION HAS REMADE RURAL IRELAND j 
 
 A Visit to Sir Horace Plunkctt and What I Learned — Then ] 
 
 a Visit to Kilkenny, Where I Found His Co-operation Ideas I 
 in Full Blast — The BaUyragget Co-operative Creamery and 
 
 Poultry Societv and the Story of Their Growth. i 
 
 IN IRELAND the farmers — or a great proportion of 
 
 them — have become business men. And the rest are i 
 
 fast being waked up. That is the net result of Sir , 
 
 Horace Plunkett's co-operative movement begun \ 
 
 twenty-five years ago, and which he says, world-famous ' 
 
 ihough it has become, is as yet only in infancy. i 
 
 Sir Horace told me that it was in America that he got the i 
 
 inspiration for his great life work. It was when he was j 
 
 ranching out in Wyoming away back in the 8o's. "I got ^ 
 
 into the American habit of looking at everything from a < 
 
 business point of view," he told me, "and when I came back ] 
 
 to Ireland in '89 I simply resolved to study Ireland as a i 
 
 business proposition. To my mind the then most pressing | 
 
 question was neither home rule nor any other political \ 
 
 issue, but how the people were going to make a living: 1 
 a business proposition indeed, and an agricultural business 
 
 proposition, since over two-thirds of Ireland's population ' 
 
 was agricultural. And in solving this agricultural business j 
 
 proposition it seemed to me that we needed three things — j 
 
 Better Farming, Better Business, Better Living, but I saw | 
 
 that emphasis must be laid on the middle phrase, because i 
 only through better business could we get better farming 
 
 or better living." j 
 
 "The problem of remaking rural life in Ireland, America j 
 
 or anywhere else, in fact," Sir Horace continued, "is like- , 
 
 147 I
 
 148 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 wise threefold — (i) technical, (2) commercial, and (3) 
 social; but the clearest and surest avenue of achievement 
 is through the commercial feature. First, make the farmer 
 a better business man and all these other things will be 
 added unto him." 
 
 This is the new conception of agricultural progress that 
 is beginning to take possession of men interested in rural 
 progress the world over. To make two blades of grass grow 
 where one grew before : this has been regarded as the end of 
 agricultural progress from the day Dean Swift set down 
 the opinion of the King of Brobdingnag until now. But 
 at last a change has come. The business organization of urban 
 industry — the systematic, scientific, commercial manage- 
 ment of urban production — has been for generations now 
 an accomplished fact and the human race has benefited 
 incalculably thereby; and Ireland and Denmark are now 
 teaching us that there are possibilities for a hardly less 
 momentous business organization of rural industry — not 
 only increased production, but the systematic, scientific, 
 commercial management of this increased production. 
 
 No wonder, therefore, that Mr. Robert A. Anderson, 
 secretary of the Irish Agricultural Organization Society, 
 remarked to me as I was leaving his Dublin office : "Of 
 one fact we are rather proud, and that is, it has been our 
 good fortune in Ireland to set an example in agricultural 
 co-operation for all English-speaking peoples." 
 
 This is, indeed, exactly what Ireland has done; and our 
 American farmer, whose richer opportunities, better facil- 
 ities, and more democratic atmosphere should have won for 
 us a position of leadership, must go to Ireland to learn the 
 lessons needed for all America. In Ireland, which has a 
 population about twice that of one of our average States, 
 there are now 312 creameries with an annual turnover of 
 $10,000,000; 166 agricultural societies; 237 co-operative 
 banks, and 87 miscellaneous co-operative societies — poultry, 
 beekeeping, bacon-curing, etc. 
 
 Suppose we had in each county in the United States two
 
 MAKING FARMERS INTO BUSINESS MEN 149 
 
 co-operative creameries, one or two farmers' co-operative 
 banks, and one or tv^^o co-operative societies for the sale 
 of poultry and truck : such a development would correspond 
 to what has been accomplished in Ireland. 
 
 Of course, all this has not been brought about in a day. 
 The movement started away back in 1889 when Mr. Horace 
 Plunkett began to tell the Irish farmers that what they 
 needed was less politics and more business — or at any rate, 
 a good deal more business along with their politics. For a 
 long time his voice was as that of one crying in the wilder- 
 ness. He held fifty meetings and pleaded with fifty different 
 groups of farmers, asking each group to join in some co- 
 operative business organization, before a single enthusiastic 
 response varied the long monotony of deaf-eared failure. But 
 Mr. Plunkett was an Irishman terribly in earnest; and 
 anybody who is terribly in earnest is likely to go a long 
 way — especially if he is an Irishman. 
 
 "Beware when the Lord Almighty lets loose a thinker on 
 the planet," says Emerson, in words as nearly as I can recall 
 them; and Mr. Plunkett was a thinker. He was also a 
 patriot with a yearning for the uplift of his oppressed and 
 poverty-stricken homeland. He had all the patriotism to 
 which Erin's poets and orators have given such vivid and 
 eloquent expression ; but his patriotism was to take a form 
 of constructive work rather than inflammatory eloquence. 
 
 The Irish farmer, at that time, was the joint prey of 
 landlords and "gombeen-men," the latter phrase being 
 used to describe a class of credit or "time" merchants whose 
 exorbitant time prices kept the poor peasants in virtual 
 slavery. What profit the landlord did not get in the shape 
 of rent, the "gombeen-man" got when the money for the 
 farmers' products came in. Or, to be exact, I should say 
 that the credit merchant took the farmers' goods at prices 
 named by himself, and credited them on the farmer's ac- 
 count, and about all the poor soil tiller knew was that he 
 was getting deeper and deeper into debt all the time. It 
 was our blood-sucking "credit system" of the South of a
 
 150 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 generation ago in an even more abominable form ; and the 
 "gombeen-men," furnishing not only supplies, but liquor 
 as well, often took further advantage of the peasant after 
 getting him full of drink. 
 
 In a word, middlemen were absorbing all the profits of 
 the Irish farmer. Nothing was done directly. There was 
 a circuitous route from the farmer's produce to the city 
 consumer, with tolls taken all along the way ; and there was 
 a circuitous route between the fertilizer maker or implement 
 manufacturer and his farmer purchaser, with tolls taken all 
 along the way, as Mr, Horace Plunkett kept saying with a 
 sort of damnable iteration. 
 
 Another thing that Sir Horace saw (I now say Sir Horace 
 because the King of England has since knighted Mr. Plun- 
 kett in recognition of his great services) was that if the 
 farmers were to succeed, they must organize and co-operate. 
 Only a considerable number of farmers working together 
 could sell their products to advantage — a small farmer can- 
 not profitably ship a dozen or two eggs or a pound or two of 
 butter or a basket or two of vegetables, whereas, it is very 
 different if a hundred farmers together wish to ship their 
 combined product of eggs, poultry or truck — and they must 
 work together along very businesslike and scientific lines. 
 He saw that the farmers were suffering not only because 
 the middlemen's tolls were excessive, but also because their 
 failure to unite prevented them from giving consumers uni- 
 form, high-quality products. He declared they must fur- 
 nish "one good kind of butter — not many samples of bad 
 and good kinds; a uniformly fresh egg — not a dozen stale 
 ones of different shapes and sizes, with occasional fresh ones 
 rubbing shells with their dingy neighbors ;" and that they 
 must furnish regular supplies at regular intervals — not three 
 long weeks of famine and then a week of surfeit. 
 
 "Better Farming, Better Business, Better Living" — this 
 was the threefold program which Sir Horace advocated in 
 his crusade through Ireland; more productive farming 
 methods, better methods of buying and selling, and a richer
 
 MAKING FARMERS INTO BUSINESS MEN 151 
 
 rural life. And he kept everlastingly at it, in season and 
 out of season. After holding fifty meetings he got one 
 society started in 1889, and 1890 ended without another one 
 being added to this lonesome first-born. But in 1891 the 
 number jumped to seventeen; next year there were twenty- 
 five ; next year, thirty ; next year, thirty-three ; and then the 
 day of small things had ended. In 1895 the number of 
 societies doubled ; in 1896 the one hundred mark was passed ; 
 in 1898, the two hundred mark; in 1899, the four hundred 
 mark — and now there are more than eight hundred. The 
 Irish Agricultural Organization Society — popularly known 
 as the "I. A. O. S." — is the head of the movement, with Sir 
 Horace as the head of the I. A. O. S., and Mr. Robert A. 
 Anderson the secretary. 
 
 From these officers of the I. A. O. S. I received very full 
 information about the various organizations; and with let- 
 ters of introduction from them I went down into Kilkenny 
 county to inspect the workings of some of these agricul- 
 tural organizations at first hand. Kilkenny is a dairying 
 county and in it are sixteen co-operative creameries ; four 
 farmers' co-operative banks ; eight agricultural societies 
 for the purchase of fertilizers, seeds, etc.; a co-operative 
 poultry society and a farmers' county fair. 
 
 In the depot at Ballyragget, the first Irish village I visited, 
 the most conspicuous objects were cases with the labels, 
 "Guaranteed Pure Irish Creamery Butter," and other cases 
 for shipment bearing the legend, "Guaranteed New-Laid 
 Irish Eggs," with the added name and trade-mark of the 
 "Irish Federated Poultry Societies, Limited." I made sev- 
 eral trips out into the country around Ballyragget to see for 
 myself the workings of the various co-operative societies, 
 and I probably cannot give a better idea of the general 
 movement in Ireland than by describing in detail the work 
 of these individual Kilkenny organizations as I saw them. 
 
 Perhaps the best work here, as in other parts of Ireland, 
 is done by co-operative creameries. Muckalee creamery, 
 near Ballyragget, was one of the first organized after Sir
 
 152 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 Horace Plunkett began his work, and it has been such a 
 success that I found the neighboring Castlecomer farmers 
 planning to establish a creamery of their own if a sufficient 
 number of cows can be secured for it. Milk is tested for 
 butter fat, and farmers are paid by the pound — not by the 
 gallon — and in proportion to the amount of butter fat in 
 their milk. As a rule, the creamery butter pays the farmer 
 six to eight cents a pound more than ordinary homemade 
 butter, and the Irish housewife is also relieved of the work 
 of churning and molding the product, besides getting back 
 eight and one-half gallons of separated milk for every ten 
 gallons supplied. A Ballyragget business man told me 
 that the Muckalee creamery butter was bringing 120 
 shillings per hundredweight as compared with 96 shillings 
 for ordinary farm butter; which statement being translated 
 into plain United States language (with the further under- 
 standing that this Irish hundredweight means 112 pounds, 
 and not 100 pounds as with us) means that the creamery 
 butter was selling for about 27 cents a pound and the or- 
 dinary butter for about 21 cents. Moreover, all the profits 
 of the creamery are divided pro rata among the farmers 
 who supply the milk, so that the farmer has other sources 
 of profit besides the gain from the improved quality of his 
 product. 
 
 No less interesting than the Muckalee creamery is the 
 North Kilkenny Poultry Society, with headquarters in Bally- 
 ragget. This society, a combination of 450 poultry raisers 
 in and around the village, has had a rather significant his- 
 tory. In the beginning, so a Kilkenny farmer told me, it 
 had one or two so-called "expert" managers from a distance 
 who turned out to be "expert" mainly in eating up the 
 profits, so that for the first three years the society ran at a 
 loss. 
 
 Then something happened which often happens in these 
 co-operative societies, and whenever farmers unite and meet 
 together for any purpose, namely, hitherto unappreciated 
 local talent was discovered and made use of. The mem-
 
 MAKING FARMERS INTO BUSINESS MEN 153 
 
 bers picked up John Carey, a plain young farmer boy with- 
 out any frills about him, but with plenty of everyday com- 
 mon sense and a good character, and put him at the head 
 of the society. In three years' time he has wiped out the 
 old loss, increased the membership by nearly two hundred 
 and has carried the total poultry and egg trade from $25,000 
 three years ago to more than $40,000 a year. Farmers 
 get 30 per cent more for their eggs than they did before they 
 organized, not merely because they save the middleman's 
 profits, but because they ship eggs while they are fresh and 
 clean instead of waiting for them to get stale and dirty, be- 
 cause they ship them properly graded and crated, and be- 
 cause they know just where to ship in order to secure top- 
 notch prices. Ever5rwhere one finds that co-operation pays 
 the farmer increased profits not only by transferring to his 
 pockets the tolls of unnecessary middlemen, but also be- 
 cause of its everlasting insistence upon "quality" products. 
 
 But my saying that the farmer knows where to ship 
 calls for a word of parenthetical explanation. The various 
 agricultural organizations maintain in Dublin what is 
 known as the "I. A. W. S."— the Irish Agricultural Whole- 
 sale Society — an organization which not only furnishes the 
 society members with fertilizers and seeds at wholesale 
 prices, but keeps in touch with all the leading English mar- 
 kets and directs organized societies where to ship their produce. 
 My friend, Mr. Carey of the North Kilkenny Poultry So- 
 ciety, for example, gets news from the Dublin I. A. W. S., 
 say each Saturday, as to what English market he should 
 ship his goods to the following week, and the probable 
 price. The price is then fixed at which the society will buy 
 eggs during the week, and all guaranteed fresh eggs are 
 bought at this figure at so much a pound. 
 
 The morning I was there, as every other week day, two 
 carriages had gone out over a radius of six miles to collect 
 eggs ; and on Mondays they go out as far as ten miles. Eggs 
 of the same size and color are shipped together and small 
 eggs are shipped as "seconds." Dirty eggs are also shipped
 
 154 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 separately, and care is taken in every way to maintain a 
 reputation for giving the buyer exactly what is promised 
 him. 
 
 Another work it is now proposed to take up is that of 
 fattening young chickens before shipping them, instead of 
 shipping them elsewhere to be fattened, as is the present 
 practice. 
 
 In this society, as in the case of the Muckalee and all 
 other such organizations in Ireland, the profits go to the 
 patrons. There are annual meetings which all the mem- 
 bers attend, and the regular business in the interim, is 
 conducted by an elected committee of twenty-five members, 
 a quorum of whom meet with the manager monthly for the 
 examination of the books and for general oversight of the 
 business. I was told that an average patron had about 
 fifty hens, and the women, of course, look after them in 
 most cases. 
 
 One other feature of this society deserves mention — that it 
 could not have succeeded without the support it received 
 from the Catholic priest and a wealthy landowner nearby. 
 In fact, in nearly all the societies I visited I found that the 
 Catholic "fathers" — nearly everybody in Kilkenny is a 
 Catholic — were active leaders. I wish our preachers all 
 over America showed as much interest in the general move- 
 ments for rural development and uplift.
 
 CHAPTER XIX 
 
 TWO IRISH RURAL CREDIT SOCIETIES, AND 
 
 HOW THEY WORK 
 
 The Officials Were "Surprised Entoirely" at Mr. Brett's Story 
 — A Peep at the Books Showing Loans to Buy Cows, Pigs, 
 Seeds, Fertilizers, etc., and Also How the Members Learn 
 Business Ways — Castlecomer Society "Has Never Lost a 
 Penny Piece in Bad Debts." 
 
 I NEXT visited :Mr. John Brett, secretary of the "Bally- 
 ragget Agricultural Bank," a typical farmers' credit 
 society of the now world-famous Raiffeisen type. I 
 found in Mr. Brett a sturdy, stubby, good-natured Irish 
 farmer and ex-schoolmaster, whose thrift has brought him 
 in his age into possession of one hundred acres of land — a 
 pretty large farm in Ireland. Moreover, the Ballyragget 
 innkeeper informed me that he also gets a pension as a 
 retired school teacher, he having served full thirty years, I 
 believe, in the schoolroom, and the British government, 
 unlike ours, having acted on the theory that it is just as 
 sound policy to pension teachers who make life more abun- 
 dant as it is to pension soldiers who destroy life. As we 
 walked through his fields, IMr. Brett told me of the workings 
 of the agricultural bank, and then took me to his little farm- 
 house to show me the "books." 
 
 The story of its growth is interesting, and Mr. Brett 
 confided to me that when he recounted it before a public 
 committee in Dublin recently, they were "surprised en- 
 toirely." I doubt not, too, that many of our American 
 farmers will be "surprised entirely" to find out how much 
 superior are the banking facilities these Irish farmers have 
 worked out for themselves as compared with our own. 
 
 166
 
 156 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 Here is the story in brief: In 1901 Mr. G. W. Russell, 
 editor of the Irish Homestead, the organ of the Irish Agri- 
 cultural Organization Society, went down to Ballyragget 
 and told them how to proceed with their organization. 
 There were about fifty members to start with; they fixed 
 a six-shilling ($1.44) entrance fee; elected the parish priest 
 as president; named an executive committee and pledged 
 their joint credit to get a loan of £100 (or $486 American 
 money) from the government. On this loan they paid in- 
 terest at the rate of 3 per cent and lent money to the mem- 
 bers at 5 per cent. Another point that must always be kept 
 in mind is this: money is lent to members for productive 
 purposes only. That is to say, no money is lent to a man 
 merely to keep him going the even tenor of his way, but 
 only to help him go forward — to help him buy stock, or 
 make some improvement, or take advantage of some other 
 safe and profit-promising farm investment. 
 
 The farmer does not put up collateral to secure a loan, 
 but he must have two solvent sureties to sign with him. 
 And here is the keynote of the whole system : From be- 
 ginning to end it is based on the principle of co-operation, 
 on the idea that the members must help one another, be- 
 lieve in one another, and join together in a movement for 
 the common uplift. All are, indeed, neighbors, for member- 
 ship is limited to persons living within three miles of the 
 secretary's office. The members of the bank are jointly 
 liable for the safety of the money it borrows or receives as 
 deposits, and two persons must indorse with the borrower 
 for every loan. 
 
 Perhaps, too, it may be as well to explain just here that 
 while this institution is called a "bank," it is very different 
 from the banks we are accustomed to seeing, it being, in 
 fact, only a farmers' mutual credit society, with one of their 
 number as "cashier," keeping the books in his own home. 
 There is no expensive office to maintain or rent to pay, and 
 about the only expense incurred is a nominal sum for book- 
 keeping and the annual examination of the books by an
 
 TWO IRISH RURAL CREDIT SOCIETIES 157 
 
 expert auditor from the city. The executive committee 
 meets once a month to consider applications for loans and 
 to see that all notes that have fallen due are paid. The 
 members who have surplus funds may deposit them in the 
 bank and receive 3^ per cent interest. 
 
 It is not presumed that there will be much idle capital; 
 the outstanding loans should about equal the capital and 
 the deposits; but in case a surplus exists, it is invested in 
 government bonds or deposited in the postal savings bank 
 or other interest-paying financial institutions. 
 
 The first year of its operation the Ballyragget Co-oper- 
 ative Bank received no deposits. "The people would not 
 trust us then," Mr. Brett told me; but now the bank gets 
 more money than it can handle, although it has reduced 
 the interest paid on deposits to 3 per cent. Instead of the 
 £100 ($486) capital with which the bank started, it now 
 has capital and deposits aggregating thirteen times as much, 
 and it has extended its influence from a three-mile radius 
 to a five-mile radius. 
 
 The good this bank has accomplished in the community 
 is almost incalculable. The farmer-members now borrow 
 money from it at 5 per cent besides getting back the 
 profits that the bank makes, and they can borrow for 
 a period of twelve months in case the money is 
 needed for so long a time. Before the coming of 
 the bank, if a Ballyragget farmer wanted a loan, he had 
 to go to Kilkenny, the county seat, pay 6 or 7 per cent for a 
 loan, take two neighbors with him to sign the note as 
 securities, and feed and treat these indorsers, and go through 
 the same expensive proceeding to get the loan renewed at 
 the end of three or four months — if he could. With such a 
 system, of course, few farmers got the benefit of credit, as 
 much needed in farming operations as in business opera- 
 tions, and when loans were obtained, the excessive cost fre- 
 quently left the farmer worse off than before. Now all 
 this is changed. If a farmer needs $10 to $100 for a really 
 productive purpose, he simply gets two of his neighbors
 
 158 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 to sign with him ; gets the money from the farmers' mutual 
 ^>ank at 5 per cent ; borrows, if necessary for a longer period 
 than the city banks would have lent to him, and has no 
 embarrassing red tape to go through with. 
 
 Or if an exact summary of the advantages of these small 
 co-operative banks is wanted, let us say: 
 
 (i) The farmer gets small sums when needed, such as 
 it would not pay him to go through the trouble of trying 
 to borrow from a city bank ; 
 
 (2) The higher interest rate and the expenses of sureties, 
 investigations, etc., formerly made most bank loans cost 
 him over 12 per cent, whereas this cost is cut in half under 
 the co-operative system ; 
 
 (3) The city banks will lend for only three or four months 
 (our whole banking system being built to meet the city 
 man's needs), while the agricultural bank recognizes the 
 fact that in farming one must frequently borrow for twelve 
 months or not at all ; 
 
 (4) The simple operation of having two solvent friends 
 or neighbors indorse one's note prevents the necessity of 
 putting up collateral or making a mortgage, besides stim- 
 ulating brotherliness and co-operation; and — 
 
 (5) Limiting loans to those made for productive pur- 
 poses, prevents the bank from being imposed upon by 
 shiftless farmers, and prevents any farmers from tying up 
 or losing their estates by reckless and indiscriminate bor- 
 rowing. The agricultural bank is for the purpose of getting 
 the farmer out of debt, not of getting him into it. 
 
 To illustrate more clearly just what this particular bank 
 is doing, let me mention some of the loans as I found them 
 in Mr. Brett's books. 
 
 First, there was a loan of $125 for twelve months to 
 enable a certain farmer "to hold over stock for a better 
 sale." 
 
 Then a loan of $60 for twelve months to help someone 
 buy a cow.
 
 TWO IRISH RURAL CREDIT SOCIETIES 159 
 
 Twenty-five dollars for twelve months, "to purchase a 
 grass take to graze a horse." 
 
 Sixty dollars to buy two calves. 
 
 Forty-five dollars to buy seeds and fertilizers. 
 
 Seventy dollars to buy calves. 
 
 Ten dollars to buy two pigs. 
 
 One hundred dollars to buy young stock. 
 
 Thirty-five dollars to buy a heifer. 
 
 Twelve dollars and forty cents ($2.40 payable monthly) 
 to buy small pigs. 
 
 Tw^enty dollars to enable a farmer to hold over cattle. 
 
 The minutes show that the official committee members who 
 meet monthly and pass upon all applications, act very pru- 
 dently and carefully, knowing that their credit is pledged, 
 as well as that of other members, for the solvency of the 
 society. Notice these typical entries : 
 
 "Thomas Lacy, £6 to buy a horse; granted." 
 
 "Michael Murphy, £7 to buy two calves; granted." 
 
 "William Phelan, £12 to buy a cow; refused, as one 
 surety was objected to ; granted on condition that two 
 solvent sureties can be obtained." 
 
 Another meeting : "Mr. Michael Clancy's loan of £9 was over- 
 due. He attended and offered £2 on account of interest. 
 The £2 offered was not accepted. He was ordered to pay 
 the full sum or proceedings would be taken at the quarter 
 session for the recovery of the loan." 
 
 Again : "Michael Downey attended and obtained a fur- 
 ther time for two months for payment of loan. Thomas 
 Lacy, ditto, till he could sell his barley." 
 
 And so it goes. Men thus have the opportunity of bor- 
 rowing who could not borrow from an ordinary bank, and 
 the loans to the farmers have enabled them to make and 
 keep many a shilling in the neighborhood. "We lend a man, 
 say £15 to buy a young cow," said Mr. Brett, "and he pays 
 15 shillings [5 per cent] interest, and at the end of a year 
 has a cow worth £18, and a calf besides — all for the sake 
 of the 15 shillings."
 
 160 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 The Ballyragget Agricultural Bank does business on 
 such a narrow margin that its profits no year have ex- 
 ceeded $25 or fallen below $5. A few dollars a year to 
 Mr. Brett for bookkeeping covers the entire official expense, 
 and as his home is the office, there is no charge for rent. I 
 notice, however, that Sir Horace Plunkett, in his latest 
 president's address strongly advises that these co-operative 
 banks should not attempt to lend money at too low a rate 
 — especially in view of the fact that any profits will go as 
 reserve fund in which the members are equally interested — 
 and that 6 per cent rather than five should be the normal 
 rate on loans. 
 
 No loans are made for over $150. Originally the maxi- 
 mum was $50, but this amount was soon raised to $75. 
 The first of this year ninety loans were outstanding aggre- 
 gating over $4,000. 
 
 I also paid a visit to the Castlecomer Credit Society, or 
 Agricultural Bank, which I found in no less flourishing 
 condition than the one at Ballyragget. All these banks 
 operate on the same general principles, so the rules of the 
 Castlecomer Society are practically the same as those I 
 have given for its neighbor. It has existed for twelve years 
 and "has never lost a penny piece in bad debts," as the 
 secretary, Mr. Joseph Tobin, told me, though, of course, it 
 has had to resort to proceedings once in a while. On Jan- 
 uary I its capital consisted of about $3,800 borrowed at 4 
 per cent, and $2,000 in members' deposits bearing 3^ per 
 cent interest, practically the entire $5,800 total being loaned 
 out to members at 5 per cent. Only two loans were then 
 overdue and these have since been repaid. The entrance 
 fee is one shilling, and there are 278 members. The maximum 
 amount that can be lent any one person is $100; and there 
 is a fine of 15 per cent for allowing a loan to become over- 
 due. The annual turnover grew from $1,250 the first year 
 to $2,000 the second, $3,000 the third, $4,000 the fifth and 
 $6,000 the sixth, and is now $10,000 a year. 
 
 In addition to all the usual society books and records.
 
 TWO IRISH RURAL CREDIT SOCIETIES 161 
 
 such as I found at Ballyragget, Mr. Tobin showed me an 
 alphabetical index which indicates at a glance whether or 
 not a member has money borrowed or is surety for a neigh- 
 bor-borrower, and enables the executive committee at its 
 monthly meeting to determine instantly whether or not 
 any member should be granted a further loan or accepted 
 as a surety for another borrower. And the success of the 
 Castlecomer Co-operative Bank in aiding the farmers of 
 the community has been no less marked than in the case of 
 Ballyragget. 
 
 "I know many members," said Mr. Tobin, "who pay back 
 the money at the end of the year out of the profits made 
 on the original loan and have the loan money itself left 
 them clear." 
 
 It will be seen from the foregoing that the Ballyragget 
 and Castlecomer credit societies are typical illustrations of 
 the Raiffeisen farmers' bank of which the distinguishing 
 features are (i) the unlimited liability of the members, (2) 
 membership limited to a neighborhood where all know one 
 another, and (3) loans are made only for productive pur- 
 poses. The following extracts which I have copied from 
 the "Rules of the Ballyragget Agricultural Bank," are inter- 
 esting in this connection : 
 
 Character of Loans — "Loans to members shall only be made on con- 
 dition that the purpose for which money is borrowed is such that there 
 is a sufficient prospect of the loan repaying itself by the production, 
 business, or economy which it will enable the borrower to effect." 
 
 Restricted Membership — "Any person of good character approved 
 by the committee, and who resides within five miles from the office of 
 the society, is qualified for admission to membership, provided that 
 his liabiHty is not already pledged by membership in a similar associa- 
 tion." 
 
 Liability — "Every member of the society shall be, equally with every 
 other member, jointly and severally liable for all debts incurred by the 
 society, and for any loan which a member, or his sureties fail to pay; 
 but each member of the society shall be liable only for the debts in- 
 curred and loans advanced during his membership." 
 
 "One Man, One Vote" — "No member shall be entitled to more than
 
 162 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 one vote upon any matter submitted for consideration at any general 
 meeting." 
 
 Directors Serve Free — "The committee of management shall be 
 elected at the annual general meeting of the society. The members 
 shall be eligible for re-election on the expiry of their term of office. 
 . . . They shall not receive salary or other remuneration." 
 
 Monthly Meetings of the Loan Committee — "A statement of ac- 
 counts shall be presented by the secretary or other officer appointed by 
 the committee showing the loans outstanding, deposits on hand, and 
 monejs received or paid since the last meeting. This statement shall 
 be checked and signed by two members of the committee. The secre- 
 tary shall then report as to the installments of loans due and unpaid, 
 and the action to be taken in each case shall be determined. He shall 
 then read the list of applications for loans which may not have been 
 previously granted owing to funds not having been available, and a 
 decision shall be arrived at as to which of these shall be granted if 
 additional funds are reported as being available. Any fresh applica- 
 tions for loans will then be considered and the course to be taken with 
 each determined." 
 
 A Council of Control — "In addition to the committee there may be 
 a council of control, consisting of not more than five members, who 
 shall not be members of the committee, but who shall be elected an- 
 nually by the members at the general meeting. . . . The council 
 shall meet at least once every three months to review the business 
 transacted by the c mmittee, and shall satisfy itself that all rules have 
 been complied with. ' 
 
 Rules for Loans -"(a) Loans, when approved by the committee, 
 shall be granted to nembers who are able to obtain two sureties ap- 
 proved by the comr. :ttee, or who can give such security as the com- 
 mittee deem sufficient. 
 
 "(b) No member who is in possession of money lent to him by 
 the society shall be accepted as surety for another member requiring a 
 loan, unless the committee are unanimous that it is safe to do so. 
 
 "(c) Members who desire to obtain a loan shall fill up a form stat- 
 ing the object for which the loan is required, the term for which it is 
 asked, whether it is desired to repay the loan by installments, the sure- 
 ties who will sign with him any agreement or promissory note, or the 
 other security which is offered. The application, if forwarded to the 
 secretary not less than two days prior to a meeting of the committee, 
 shall be considered at that meeting. 
 
 "(d) If the committee are satisfied with the trustworthiness of the 
 applicant, the sufficiency of the security offered, the profitableness by 
 productiveness or saving which the use of the loan may effect, and if 
 they have sufficient funds under their control, they m"'; sanction the 
 loan.
 
 TWO IRISH RURAL CREDIT SOCIETIES 163 
 
 "(e) No loan shall be granted for a period exceeding one year 
 unless it be made repayable by regular installments of equal amount; 
 nor shall any loan be granted to a member which shall make the total 
 sum owing from him to the society at any time to exceed fifty pounds" 
 ($250). 
 
 No Profits to Be Given Members — "No profit, bonus or dividend of 
 any kind shall be divided amongst the members. Any surplus accru- 
 ing to the society, after payment of the cost of administration, shall be 
 carried to a reserve fund. If any loss be incurred by the society, the 
 annual general meeting may vote such sum as it may think desirable 
 from the reserve fund in order to meet the deficiency. In no case 
 shall the reserve fund be divided, and, in case of dissolution of the 
 society, it shall be devoted to some useful purpose in the district in 
 which the society operated, and determined upon by the meeting at 
 which the dissolution of the society takes place." 
 
 Annual Auditing Insured— "The committee of management shall, 
 once at least in every year, submit the accounts, together with a gen- 
 eral statement of the same, and all necessary vouchers up to the 31st 
 December then last for audit, either to one of the public auditors 
 appointed under the Friendly Societies' Act, or to two or more persons 
 appointed as auditors by the members at the annual general meeting 
 each year."
 
 CHAPTER XX 
 
 THE LARGE OUTLOOK OF THE IRISH AGRICUL- 
 TURAL LEADERS 
 
 First a Word About a Typical Co-operative Agricultural So- 
 ciety — "The United Irish Women" and Their Purposes — 
 Irish Leaders Recognise Twofold Problem of Agricultural 
 Organization: '(i) Scientific Production and (2) Scientific 
 Marketing. 
 
 IN CASTLECOMER also is located the "Valley of the 
 Deen Co-operative Agricultural Society," a society of 
 farmers organized for the purpose of saving money on 
 the purchase of "seeds and manure" — everybody 
 abroad says "manures" when referring to commercial fer- 
 tilizers. It started several years ago with 100 members. 
 Now it has 280, and does an annual business of about $2,500 
 in fertilizers and implements (mainly fertilizers, for the 
 farms over here are too small to make profitable use of ex- 
 tensive farm machinery) ; $1,250 in seeds, and $1,600 in 
 feedstuffs. 
 
 The society charges 5 per cent profit on purchases — the 
 profits, after deducting a $50 a year salary to the secretary, 
 becoming the property of the members ; and of the total sub- 
 scription entrance fee of $5, only 50 cents has been called 
 for. Every member takes one $1.20 share in the general 
 "Irish Agricultural Wholesale Society" of Dublin, to which 
 reference has already been made, and through which all 
 orders are placed. The society owns two manure spreaders 
 and two spraying machines for the joint use of all the mem- 
 bers — an illustration of the idea of co-operative ownership 
 of expensive farm machines which is becoming quite popu- 
 lar in Ireland. Sixteen thousand Irish farmers are mem- 
 
 164
 
 OUTLOOK OF THE IRISH AGRICULTURAL LEADERS 165 
 
 bers of such agricultural societies as this, and the members 
 not only save much money on their purchases, but they 
 have become interested in fertilizer subjects and have come 
 to insist upon purer seeds and upon fertilizer brands more 
 suited to special crops and soils. 
 
 A few years ago, so I was told by Mr. Ward, the secretary 
 of the Valley of the Deen Society, the farmers took any 
 fertilizer that was put up in bags and smelled strong enough, 
 but they have now grown far "keener," as the British phrase 
 has it, and in consequence their fertilizer money is much 
 more wisely spent. 
 
 I have now referred briefly to the work of the co-opera- 
 tive creamery near Ballyragget, and the poultry society 
 there; the co-operative agricultural bank there, and its fel- 
 low at Castlecomer ; and the agricultural society for the pur- 
 chase of goods at Castlecomer. This list, however, does 
 not exhaust the forms of co-operative endeavor in the county 
 of Kilkenny and other parts of Ireland. For the first time 
 the farmers' wives and daughters are being organized, and 
 there is a branch of the "United Irish Women" at Ballyrag- 
 get which has already done some notable work. 
 
 Through arrangements made with the I. A. O. S. and 
 the department of agriculture, experts are sent to theee 
 women's societies to give instructions in domestic science, 
 cooking, nursing, dressmaking, sanitation, poultry work, 
 gardening and to help the women as members of the poul- 
 try and dairy societies, as well as in organizing country 
 amusements, local fairs, flower shows, concerts, dances, 
 rural libraries, etc. In some cases prizes are given for the 
 best kept gardens and the most attractive homes. The 
 annual membership fee in the "United Irish Women" is 60 
 cents, and one of the most striking features in it, as in the 
 men's societies, is that Catholics and Protestants — even 
 Catholic priests and Protestant ministers when called upon to 
 aid any movement inaugurated by the women — forget their 
 religious differences in a united effort for community bet- 
 terment.
 
 166 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 It will be seen from all this that the agricultural societies 
 in Ireland are very businesslike. Each society works for 
 a definite purpose, yet all are clubbed together through a 
 common membership in the I. A. O. S., to whose support 
 all local branches contribute. 
 
 When I asked Secretary Anderson how they managed to 
 keep the farmers organized, he answered, "Simply by show- 
 ing them that it pays." If farmers and farmers' wives get 
 30 per cent more for their eggs by working together 
 through poultry societies; and six cents a pound more for 
 their butter by forming co-operative creameries; and are 
 able frequently to double a year's profits by being able to 
 borrow needed sums from co-operative banks ; or save $2 
 or $3 a ton on fertilizers by ordering in a body — when such 
 practical benefits as these are in evidence, one is not likely 
 to hear much of the old, old story, "Farmers won't stick to- 
 gether." In Ireland they do stick and they do succeed. 
 Because of this fact, they feel a new dignity for themselves, 
 and the state and the nation feel a new respect for them. 
 As Sir Horace says : "I do not know how it is in America, 
 but at home I have observed that, when legislation affect- 
 ing any particular interest is under discussion in Parliament 
 or elsewhere, those who speak on behalf of that interest 
 are listened to with an attention strictly proportionate to 
 the organization of those they speak for — not political or- 
 ganization, but business organization." 
 
 There is just one other big fact to which I would call 
 attention before leaving our discussion of Irish co-operation, 
 and that is the broad outlook of the leaders of Irish agricul- 
 tural co-operation. They are not one-idea men. They 
 see what so many over-zealous converts to co-operation in 
 America seem to forget, namely, that the wide-awake busi- 
 ness man looks after two things — economy of production 
 and economy of distribution, and that the wise farmer must 
 also look after both. He cannot afford to neglect either. 
 As Sir Horace Plunkett says : "An efficient department 
 [of agriculture] can help the farmer to grow more crops
 
 OUTLOOK OF THE IRISH AGRICULTURAL LEADERS 167 
 
 and breed better cattle and do these things at less expendi- 
 ture than when his output was smaller in amount and in- 
 ferior in quality. But he will not get a full reward of his 
 intelligence and enterprise, unless he learns to control the 
 distribution of his produce and obtains working capital on 
 suitable terms. This he cannot do until he adopts the co- 
 operative method. On the other hand, what is the use of 
 organizing the farmers, if they are not making good use 
 of their land?" 
 
 The two things must indeed go hand in hand, and those 
 leaders are not wise who try to encourage one policy at 
 the expense of the other, or try to make it appear that one 
 policy is at enmity with the other. The farmer does need 
 to learn how to produce his beef more economically. He 
 also needs to know how to market this beef more econom- 
 ically after he makes it, and thereby save to himself the 
 millions the beef trust takes in unnecessary tolls between 
 the farmer's barnyard and the city butcher shop. The 
 farmer does need to know how to make his cotton with the 
 smallest possible outlay of sweat and purse. He also needs 
 to know how to save to his own pocketbook the millions and 
 millions of appreciation in value between the time the cot- 
 ton leaves his hands in November and the time the norma! 
 price level is reached in May. 
 
 The present prosperity of the Irish farmer seems to me 
 to be largely due to the fact that nearly all his leaders have 
 recognized the twofold character of his problem. Sir 
 Horace Plunkett and other leaders, in organizing the farm- 
 ers, have strenuously insisted at the same time upon better 
 methods of farming, while the department of agriculture, 
 always insistent upon more progressive farm practice, has 
 also searched the world over for examples of agricultural 
 co-operation and has been as careful to give lessons in mar- 
 keting farm crops as in producing farm crops — a thing to 
 which our United States Department of Agriculture has 
 never, until very recently, given any attention whatever. 
 
 At the beginning of his movement for organizing the
 
 168 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 farmers, Sir Horace Plunkett saw clearly that there would 
 be no hope for the Irish farmer's financial salvation unless 
 he quit the ways of his grandfathers and learned to produce 
 as economically as the farmer on the Continent ; and he was 
 so intent upon getting better methods of farming that he 
 braved local prejudice and brought in agricultural experts 
 from foreign countries — for the very good and sufficient 
 reason that at that time he could get better men abroad than 
 he could find at home. And ever since he has preached 
 better methods of production as well as better methods of 
 distribution. Thus in his latest annual report we find him 
 saying : 
 
 "The Irish dairy farmer, by the simple process of weighing each 
 cow's milk daily and periodically testing the milk for butter fat, can 
 eliminate all his unprofitable milkers, and by judicious breeding fill 
 their places with cows which would leave a handsome margin of profit. 
 In one reported case, a farmer gave figures to show that one cow in 
 his herd had given him a return of il2 ($60) for her milk, while an- 
 other cow had produced but £5 ($25). A 25 per cent increase in the 
 milking capacity of our cows would mean an increased turnover of 
 close upon £500,000 ($2,500,000) a year." 
 
 And again with regard to poultry: 
 
 "It is no exaggeration to say that the present output of eggs might 
 be almost doubled without increasing the material cost of their keep or 
 the number of fowls which are kept. It is not uncommon to find hens 
 producing 150 eggs per annum, while it is pretty safe to say that the 
 general average of Irish laying fowls would be little more than half 
 this figure. The 150-egg hen does not cost any more to keep than the 
 75-egg producer." 
 
 Moreover, the Irish Department of Agricultural and 
 Technical Instruction, in addition to all its usual depart- 
 mental labors, has taught better methods of handling, pack- 
 ing and shipping all kinds of farm products — a work which 
 should be more generally prosecuted by our departments 
 of agriculture in America. In our Southern Appalachians, 
 for example, we have a great apple-growing country, but
 
 OUTLOOK OF THE IRISH AGRICULTURAL LEADERS 169 
 
 the farmers will never half realize upon their opportunities 
 until they learn better methods of packing and shipping. 
 Nor shall we ever receive one-tenth of our possible dairying 
 profits until we learn better methods of handling our milk 
 and butter. I have before me now some typical bulletins 
 issued by the Irish Department of Agriculture : "The Pack- 
 ing of Butter," "The Marketing of Fruit," "Better Milk" 
 (issued for the purpose of insisting upon that scrupulous 
 cleanliness which is absolutely essential wherever any 
 profitable milk market is to be maintained), etc. The de- 
 partment has also issued leaflets on agricultural co-opera- 
 tion in Denmark, Germany, Switzerland and Belgium. 
 
 From all this it will be seen that the progress the Irish 
 farmer has been making has been symmetrical, compre- 
 hensive and well rounded. 
 
 The good work began with their getting control of the 
 land, as the English government has now helped them to 
 do with almost amazing success. Of the total farming 
 area of 18,739,644 acres, the tenants purchased 2,500,000 
 acres under land purchase acts from 1870 to 1896, while 
 under the vastly more liberal acts of 1903-1909 they have 
 purchased outright nearly 4,000,000 acres and have pro- 
 ceedings pending for the purchase of nearly 5,000,000 more, 
 the total area purchased outright, or for which purchase pro- 
 ceedings are pending, aggregating 11,421,448 acres, as 
 against only 7,318,196 remaining undisturbed in the hands 
 of old-time landowners. 
 
 In spite of this vast increase in land ownership as a be- 
 ginning, however, the Irish farmer today might be a dis- 
 couraged debtor instead of the buoyant and hopeful and 
 forward-looking man that he is, if his leaders had not real- 
 ized that the land would not long remain in his possession 
 unless he developed qualities of initiative, enterprise and 
 self-help. 
 
 It has also been noted all over Ireland that getting to- 
 gether for business purposes has also led the farmers to 
 join hands in many movements for "mutual, intellectual
 
 170 
 
 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 and social improvements," and that the stimulus of organ- 
 ization often leads a dormant, backward and unprogressive 
 community to show a progressiveness and enterprise in its 
 organized capacity which is nothing less than amazing. 
 
 "Better farming, better business, better living" — Sir 
 Horace Plunkett and his associates have gone far toward 
 the realization of their threefold program. They brought 
 into existence the department of agricultural and technical 
 instruction which has taken over their main work in helping 
 the farmer to do better farming ; they have established the 
 various co-operative societies which have made the farmer 
 a business man — a wise manager of values as well as a 
 wise producer of them ; and their latest organization of 
 United Irish Women is to hasten that era of better living — 
 more beautiful homes, better schools, a richer social life and 
 the production of an environment in which human beings may 
 be happier and more helpful — which is the proper goal of 
 all our striving.
 
 CHAPTER XXI 
 
 AGRICULTURAL CO-OPERATION IN ENGLAND 
 
 Why It Has Never Flourished There — The Evils of Land- 
 lordism and Some Remedies — Breaking Up Big Estates in 
 England — Australia's Plan for Graduated Taxation and for 
 Imposing Heavier Rates on Absentee Landlords — Co-opera- 
 tion Among English City Workers. 
 
 THERE is a very old story about an author who 
 was writing a book on the wild animals of the 
 Emerald Isle, with a separate chapter for each 
 species. When he came to write the chapter on 
 "Snakes in Ireland," it consisted of a single sentence : 
 "There are none." 
 
 Now, my chapter on "Agricultural Co-operation in Eng- 
 land" will not be so brief as that. In the first place, agri- 
 cultural co-operation has attained some small degree of 
 success here and there in England, so I cannot dismiss it 
 as non-existent. Moreover, there is a very interesting les- 
 son for the rest of the world in the failure of co-operation 
 to develop among English farmers. That lesson is that 
 proper rural development is impossible where landlord- 
 ism prevails, no matter what the system of renting may 
 be. The Latin writer Pliny observed 1,900 years ago that 
 large estates had been the ruin of Italy and were then ruin- 
 ing the provinces, and nineteen centuries since Pliny have 
 only added constantly increasing strength to his doctrine. 
 
 In one day's journey in rural England I heard of three 
 estates, one of 10,000 acres, one of 11,000 acres and one of 
 6,000 acres. I have before me now the daily paper's an- 
 nouncement of the approaching wedding of the Marquis of 
 
 171
 
 172 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 Anglesey, age twenty-eight, "who is the owner of about 
 30,000 acres of land." It is said that 70 people own one- 
 half of Scotland and 710 people one-fourth of England and 
 Wales. "According to the returns of 1872, 2,250 persons 
 owned half the inclosed land of England and Wales, while 
 nine-tenths of Scotland was owned by 1,700 people and two- 
 thirds of Ireland by 1,942 people." And the situation seems 
 not to have changed materially since that time except in 
 Ireland. In Great Britain in 1910 "28,238,445 acres under 
 crops and grass were occupied by tenants and 3,907,485 
 acres by owners" — over seven-eighths by tenants and less 
 than one-eighth by owners. 
 
 Such a condition is naturally ruinous to every form of 
 genuine agricultural progress. "This," says Mr. A. G. 
 Gardner, "explains why England had no share in the revolu- 
 tion which marked the last twenty-five years in the nine- 
 teenth century. That revolution has touched every coun- 
 try in Europe except Britain. It has spread from Denmark 
 to Liberia, from France to Serbia. ... It marked the 
 breakdown of one system — the system of the individual 
 unscientific and unorganized agriculture — and the emer- 
 gence of another, the system of collective effort, based on 
 the application of science and modern invention to the in- 
 dustry of agriculture. The small holder, independent, se- 
 cure, must precede the co-operative system through which 
 alone agriculture can be restored." 
 
 Mr. Gardner's contentions are sound. Thrifty, progres- 
 sive, scientific agriculture of the highest type is possible 
 only where the farmers own the land they till. In Den- 
 mark, where co-operation has gone farthest, 88 per cent of 
 the land is cultivated by owners; and Ireland did nothing 
 with agricultural co-operation until the farmers began to 
 own the land they farmed. 
 
 Rider Haggard, who visited Denmark to study the situa- 
 tion without bias, went back to England convinced that the 
 only way to get the same benefits for England, was to help 
 the English tenants buy small farms of their own. Co-
 
 AGRICULTURAL CO-OPERATION IN ENGLAND 173 
 
 operation, he declared, "will only take real root in an agri- 
 cultural community which owns, and does not hire the land 
 it works, and even then will only attain to complete success 
 and prosperity if the people of that community are very 
 hardworking, educated in the true sense, kindly, tolerant- 
 natured and intelligent." 
 
 Unless all signs fail, England's next great political battle 
 will be over this question of land reform. There is already 
 the Small Holdings Act, which provides that the county coun- 
 cil — something like our board of county commissioners at 
 home — may purchase land in lots of fifty acres or less and 
 sell to tenants on these terms : one-fifth cash and the rest of 
 the payment to be made in half-yearly installments run- 
 ing through a period not over fifty years. At the same time 
 the county councils have been authorized to purchase land 
 and rent to tenants at reasonable terms, and an officer of 
 the board of agriculture told me that 97 or 98 per cent of 
 the applicants for land prefer to rent from the State author- 
 ities rather than to buy. The farmer who rents from the 
 State is almost as much his own master as if he were land- 
 lord ; he knows that if he treats the land well he can rent it 
 as long as he likes ; that when he leaves, if he should do so 
 at all, he will get credit for any permanent improvements 
 he has made ; while, most important of all, he keeps and uses 
 as working capital the money he would otherwise have had 
 to pay for land, being thereby enabled to get better work 
 stock, tools, machinery, etc., and increase his efficiency all 
 round. 
 
 In view of these facts it now seems likely that the Liberal 
 party at the next election will advocate a great extension of 
 the plan of government purchase and renting of land. The 
 county councils already have authority to acquire lands 
 compulsorily; that is to say, they may practically condemn 
 a big estate, paying the owner its cash value, and cut it up 
 into small holdings. It happens, however, that in most 
 cases the members of these county councils have been under 
 the influence of the landlords, for which reason but little
 
 174 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 has been done toward compulsory purchases. In order to 
 make the plan really efifective, therefore, the Liberals now 
 propose to transfer this power to some central government 
 authority, removed from local influences. They will then 
 doubtless proceed actively with the work of breaking up the 
 big I, GOO to 20,ooo-acre estates whose existence prevents 
 the development of a sturdy agricultural population because 
 it prevents the development of an agricultural democracy. 
 
 Land courts will doubtless be established for the settle- 
 ment of difficulties between landowners and tenants — these 
 land courts, as in Ireland, to determine what is a fair rent; 
 to settle whether or not the landlord has allowed the tenant 
 enough for any permanent improvements he has made, and 
 fix the tenant's compensation for any unwarranted disturb- 
 ance in case he is dispossessed on short notice, etc. 
 
 The revised system of land taxation, with a view to 
 putting heavier burdens on the holders of big estates, will 
 also doubtless be a part of the Liberal program. Mr. 
 Robert Donald, editor of the Daily Chronicle, told me while 
 I was in London of the Australian plan. There the tax rate 
 is doubled on estates exceeding $75,000 in value, trebled 
 on estates exceeding $150,000, quadrupled on estates exceed- 
 ing $225,000 in value, increased fivefold on estates worth 
 $300,000. These increases apply where the land is held by 
 residents. In the case of absentee owners, the tax is heavier 
 still. In nine months after this Australian law became ef- 
 fective $90,000,000 worth of big tracts were subdivided. 
 
 Two other things the English realize : That there must 
 be co-operative agricultural banks, probably State aided, 
 for those new owners of the land, and that co-operative 
 enterprises must be encouraged. "Ireland has taught us 
 all a lesson," as Mr. Donald said to me. 
 
 In America, of course, there is not yet need for using the 
 extreme methods England proposes to adopt, but we shall 
 do well to learn in time what England's experience teaches. 
 Pity the state whose farm values are advancing, but whose 
 farm people are not advancing! Pity the state, indeed,
 
 AGRICULTURAL CO-OPERATION IN ENGLAND 175 
 
 "where wealth accumulates and men decay," because farm- 
 ing has become a place for breeding profits and not a place 
 for developing manhood ! The rural population is the 
 strength of a commonwealth only because they are less 
 commercialized, because they lay relatively more emphasis 
 on manhood and life and less on money and things, are more 
 independent, more home-loving, than the city population. 
 When big plantations and a numerous tenantry become the 
 rule, commercialism sets in, as in the city, independence and 
 individuality are destroyed as in the city, and the decay 
 of the home follows the decay of home ownership, as in 
 the city. 
 
 Eventually, no doubt, our more progressive states will 
 frame some plan for lending money to men of intelligence 
 and character who wish to acquire small farms ; the state 
 to be repaid in small annual installments — say 8 per cent 
 a )^ear — running through long periods of time, as was done 
 in Ireland. Meanwhile very big holdings should be dis- 
 couraged. I believe the Legislature of Mississippi some 
 time ago passed a law providing that industrial corporations 
 should not own agricultural lands in that state. Other 
 states would also do well to be watchful on this point. 
 
 And the Australian plan for increasing the tax rate on 
 absentee landlords also has many features of merit. 
 
 Without abating what I have just been saying about the 
 backward state of agricultural co-operation in England, 
 however (and I mean backward as compared with Ireland 
 or Denmark rather than still-more-backward America), it 
 ought to be added that among England's urban population 
 co-operation has flourished like the Psalmist's green bay 
 tree. If our own embattled farmers on Lexington battle- 
 field may be said to have "fired the shot heard round the 
 world," about the same thing may be said for the little hand- 
 ful of poor weaver-folk in Rochdale two generations ago 
 (1844), who put together their hard-earned savings aggre- 
 gating $140, and organized the first of the now world- 
 famous Rochdale co-operative stores.
 
 176 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 Today the co-operative membership in Groat Britain 
 comprises 2,700,000 souls, and in England alone the busi- 
 ness done reaches the staggering total of $600,000,000 a 
 year, while Scotland reports results little less astonishing. 
 
 The distinguishing principle in the government of these 
 stores, of course, is that only the legal interest rate is al- 
 lowed to capital — "its hire," as the Rochdale co-operators 
 put it — and all other profits (about $50,000,000 a year in 
 England), go back to the customers as "patronage divi- 
 dends" in proportion to the amount of their purchases. 
 The almost revolutionary views of these pioneers as to the 
 portion of business profits that should go to capital has 
 been set forth by Mr. Holyoake in his history of the Roch- 
 dale movement, as follows : 
 
 "The ceaseless conflicts between capital and labor arise from 
 capital not being content with the payment of its hire. When it has 
 received its interest according to its risk, and according to agreement, 
 there should be an end of its claims. Labor then would regard capital 
 as an agent which it must pay, but when it has earned the wages of 
 capital and paid them, labor ought to be done with capital. Capital can 
 do nothing, can earn nothing of itself; but employed by labor, the 
 brains and the industry of workmen can make it productive. Capital 
 has no brains and makes no exertions. When capital has its interest 
 it., claims end. It is capital taking the profits earned by labor that pro- 
 duces the conflict. In co-operation labor does not consider profit made 
 until capital is requited for its aid." 
 
 Not only are 2,700,000 Britishers now buying their gro- 
 ceries, drygoods, etc., etc., through these co-operative stores, 
 but these co-operative stores themselves decided long ago 
 that they ought to carry co-operation a little further. So in 
 1863 they organized their own "Co-operative Wholesale 
 Society," or "C. W. S.," as it is called, with $10,000 capital. 
 Its first year's business was $20,000 ; now the total net sales 
 (to local co-operative societies exclusively) exceed $150.- 
 000,000 a year. Profits, of course, are paid back on the 
 basis of patronage. As a recent magazine writer says : 
 
 "Today the English Co-operative Wholesale Society's gigantic fac- 
 tories, including the biggest boot and shoe factory in Great Britain,
 
 AGRICULTURAL CO-OPERATION IN ENGLAND 177 
 
 with a capital of $37,000,000 and 21,000 employes on their payroll, fully 
 indicate the progress made in England alone. The big industrial cen- 
 ter at Shieldhall, owned and controlled by the Scottish Co-operative 
 Wholesale, employing another 8,000 workers, proves that Scotland was 
 not far behind England in adopting the new system. 
 
 "In 1911, seventeen wholesale societies reporting did a business of 
 nearly a quarter of a billion dollars. This was an increase over the 
 previous year of $18,500,000. No society showed a decrease, but some 
 almost doubled." 
 
 I wish I could give an entire chapter to the story of this 
 Rochdale co-operative movement, which, indeed, reads like 
 a romance, but one more significant and illuminating fact 
 must suffice : "The man under whom the Co-operative 
 Wholesale Society gained its solid foundations and much 
 of its growth was J. T. W. Mitchell, who was chairman 
 from 1874 to his death in 1895. He managed this enormous 
 business with utter devotion for twenty-one years, and when 
 he died his own estate was officially appraised at $1,750. 
 This is typical of the spirit that has made the co-operative 
 movement so astonishingly successful. Co-operation has 
 had the use of some of the best business brains at absurdly 
 small remuneration because it is a moral as well as an 
 economic movement. It arouses the enthusiasm of big men 
 because its purpose is to make the brotherhood of man a 
 practical reality."
 
 CHAPTER XXII 
 
 WHAT CO-OPERATION HAS DONE FOR FRENCH 
 
 FARMERS 
 
 It Has Reduced Cost of Fertilisers, Has Enabled Poorer 
 Farmers to Combine and Use Better Machinery, Has Pro- 
 vided Almost Universal Insurance at Minimum Cost, and Is 
 Revolutionizing Marketing Methods 
 
 THERE is hardly a prettier farming country in the 
 world than France. It is a positive joy to travel 
 through its thickly settled farm communities in 
 midsummer w^hen the rich gold of the grain har- 
 vest mingles with the dark green of the growing crops and 
 the neat cottages are girt about with tall and graceful Lom- 
 bardy poplars. A much larger proportion of the farmers 
 than in England — 47^ per cent, according to the latest 
 figures I have — own their own farms, and about them all 
 there is a general air of comfort, neatness and even pros- 
 perity. 
 
 But this has not always been the case. In fact, a little 
 over a quarter of a century ago the French farmers found 
 themselves face to face with conditions of the gloomiest 
 sort. They had been farming the way their fathers had 
 farmed and their grandfathers before them, every man for 
 himself; and, like farmers in many other countries, they 
 might never have done any better if disaster had not forced 
 them, like young eagles thrown from their nests, into wor- 
 thier activities. It is the old story repeated in the history 
 of every nation and every individual, of good coming out 
 of evil. When I was in the Hawaiian Islands, in 1910, I 
 learned that the sugar farmers, depending upon the abnormal 
 profits the American tariff afforded them, had never put 
 
 178
 
 WHAT CO-OPERATION HAS DONE FOR FRENCH FARMERS 179 
 
 their business on a really economical and scientific basis 
 until a change in the tariff, in the Cleveland era, threw them 
 on their own resources and made men of them — business 
 men. Our own Southern country might have gone on 
 indefinitely neglecting its possibilities for stock raising and 
 diversified farming if the boll weevil had not come to make 
 the one-crop system too rotten a stick to support us longer. 
 Again, the Irish farmers, to whom co-operation has brought 
 such prosperity, might never have won their goodlier for- 
 tune if they had not first become alarmed by seeing their 
 markets slipping away from them to the thoroughly or- 
 ganized Danish farmers. 
 
 So, too, it was only the prospect of a ruinous foreign com- 
 petition that brought the French farmers to their senses and 
 forced them into the co-operative movements through which 
 they have at last wrought out their own financial salvation. 
 Says Mr. E. A, Stopford : 
 
 "About the year 1884, after a long period of prosperity, the farmers 
 of France found themselves in difficulties from which they could see no 
 escape. The development of the means of transport removed all bar- 
 riers, and foreign produce touched prices which rendered home com- 
 petition impossible. Wheat from North America, India and Russia; 
 wool from Australia and the River Platte; wines from Spain and Italy; 
 even cattle from Italy, Germany and the Argentine, took possession of 
 the markets, and universal ruin of home producers seemed inevitable." 
 
 It was out of this travail that agricultural co-operation in 
 France w^as born. Now the organizations embrace about 
 1,000,000 members, and they have won the favor and good 
 will of all classes of French manhood. In France, as in Ire- 
 land, co-operation has made business men of farmers in the 
 two essential matters of (i) economical production, and (2) 
 economical marketing. Organization has also brought the 
 farmers into new political prestige, so that in the French 
 Chamber of Deputies (which corresponds to our American 
 Congress), a majority of the members representing all poli- 
 tical parties are pledged to support measures for the protec- 
 tion of agriculture.
 
 180 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 Nevertheless it is in the field of practical agricultural 
 activities rather than in the sphere of legislation that the 
 agricultural co-operation movement in France has won its 
 notable triumphs, it being claimed that it has, among other 
 things — 
 
 (i) Doubled the agricultural production of the country; 
 
 (2) Has greatly reduced the cost of marketing ; 
 
 (3) Has worked out a fine system of agricultural credit, 
 reducing the cost of money to farmers by probably 50 per cent ; 
 
 (4) Has reduced the cost of phosphates 40 or 50 per cent ; 
 
 (5) Has reduced the cost of insurance 30 to 40 per cent; 
 
 (6) And in the beet sugar industry it has developed a 
 system of business management so efficient as even to pre- 
 vent that glutting of the market which southern cotton 
 growers have found so disastrous. 
 
 The very first thing that engaged the attention of French 
 farmers was one in which our southern farmers are vitally 
 interested — commercial fertilizers or "chemical manures," 
 as they are called in Europe. Before the organization of 
 syndicates or farmers' unions, fertilizers were sold by local 
 merchants, the farmer who bought knowing nothing, and 
 the merchant neither knowing nor caring anything, about 
 the ingredients of the fertilizer or its adaptability to the 
 crop or soil it was to be used on. The farmers' unions 
 changed all this. Twice a year they collected the orders 
 from all their members, as far as they could get them, and 
 then made terms with the fertilizer manufacturers or dis- 
 tributors, effecting enormous savings as compared with 
 prices farmers had paid aforetime. The manufacturers 
 would render their bills to the individual farmers and these 
 bills would be examined and approved by the local union. 
 Then it was presented for payment by the fertilizer manu- 
 facturer or his agent. Says Mr. Stopford: 
 
 "These bills were never unpaid ; a defaulter would be struck ofif the 
 membership. Thus was a notable lesson learned; the farmers were 
 taught commercial exactness and the religion of the due date, and were 
 being trained for the organization of agricultural credit."
 
 WHAT CO-OPERATION HAS DONE FOR FRENCH FARMERS 181 
 
 That, by the way, is a very fine phrase Mr. Stopford uses 
 here : "The religion of the due date." It is this religion 
 that must be at the bottom of all successful co-operation as 
 it is at the bottom of all sound business everywhere : the 
 religion of promptness and exactness. The farmer, since 
 he has to contend with so many things in nature that are 
 not prompt and regular — the rains, the sunshine, the frost — 
 does not so easily form habits of promptness as the city 
 business man ; and it is all the more important, therefore, 
 for him to school himself deliberately in the virtue of 
 promptness, "the religion of the due date." Because they 
 did have this quality of promptness and carried out their 
 contracts with businesslike exactitude, the French farmers 
 were able very early in their work to reduce phosphate 
 prices 40 to 50 per cent, and they have effected less notable 
 reductions in the price of other fertilizer ingredients. A 
 very large proportion of the syndicates buy the ingredients 
 and mix the fertilizers for their members, in many cases 
 giving the farmer specific advice as to what sort of mixture 
 he should obtain to fit the special character of his soil and 
 the especial requirements of the crop he proposes to plant. 
 
 The farmers' unions in France have also done a most help- 
 ful work in getting their members to use labor-saving, and 
 therefore money-saving, farm machinery. It is said that 
 the farmers were very slow to use the improved tools, but 
 the unions adopted all sorts of schemes to toll or entice 
 them into better ways. Sometimes unions would help a 
 member pay the cost of a new machine in order to get it 
 introduced in the neighborhood. Sometimes prizes were 
 given to the persons showing the greatest skill in the use of 
 machines : 
 
 "Such machines as were expensive and only occasionally required 
 were bought by the syndicate for general use, and one made to work 
 for many members. For instance, plows, mowers, reapers, harrows, 
 weighing machines, straw and root cutters, winnowers, and even flour 
 mills. These were let out at a small charge. Those who used them 
 were responsible for their safety or repair in case of accident. Some
 
 182 HOW FAEMERS CO-OPERATE AND DOUBLE PROFITS 
 
 were stationary at the depots or with selected farmers; some went 
 from place to place. These plans, involving to the farmer no initiative, 
 no forethought, and little expense, were widely successful and ren- 
 dered invaluable service. The very best machines were bought, some 
 even costing $2,000 each. The money was raised by a general pro rata 
 subscription among their members, according to their acreage. 
 
 "As the utility of the implements was made known, skill in work- 
 ing them increased, and the permanent and general use of them 
 spread everywhere. Some syndicates even lent the machine without 
 charge, but this is only advisable for the temporary purpose of making 
 them known. Such gratuitous services have more the nature of 
 benevolence than of co-operation; they do not inculcate self-help. 
 Those who paid nothing detained the machines too long and delayed 
 the rotation, causing inconvenience to the members. A moderate 
 charge insures rapid use and punctual passing on." 
 
 In the same way the farmers joined together in buying 
 their commercial fertilizers and their feedstuffs. Just as 
 they made it a point to educate their members about the 
 ingredients of commercial fertilizers and the kinds that paid 
 best on certain crops and certain soils, so they set about 
 educating them as to the ingredients of different feeds and 
 feedstuffs and the kind needed for each class of animals 
 and each class of farm work. Blooded horses and cattle 
 were bought and sold to the members, and other steps taken 
 to improve the breeds of stock. 
 
 Another thing that has been attempted in France with 
 great success, and which it would be well for our own 
 farmers' unions and other agricultural organizations to push 
 more vigorously, is mutual insurance. The French farm- 
 ers have not only worked out more advantageous schemes 
 for fire insurance and live stock insurance, but also accident 
 insurance, old age insurance and insurance against hail, etc., 
 etc. It is said that the fire insurance fees have been re- 
 duced 30 or 40 per cent as a result of the unions' activities, 
 while equally as important as the reduction in the rates 
 is the fact that thousands of farmers have secured the 
 benefits of fire insurance who never would have insured at 
 all if the union had not interested itself in the matter.
 
 WHAT CO-OPERATION HAS DONE FOR FRENCH FARMERS 183 
 
 When I was in Ireland, I found that Sir Horace Plunkett 
 and his associates there were working out a system of live 
 stock insurance for Irish farmers, and undoubtedly they 
 get their greatest inspiration in the success of this move- 
 ment in France. In some cases the French farmers merely 
 pool their interests, limiting the amount to be paid on any 
 animal to 70 per cent of its value, and limiting the maximum 
 amount of any assessment levy to i per cent of the amount 
 of insurance carried. For example, if a farmer has an animal 
 worth $100, he cannot insure it for more than $70, or pay 
 more than 70 cents on any one levy ; or if a farmer has stock 
 insured for $500, he cannot be assessed in any one levy more 
 than $5. 
 
 Of course, a man's own neighbors are the committee who 
 investigate each loss, and there is, therefore, very little 
 chance for fraud. 
 
 Human accident insurance is a later growth. In England 
 now it is a law that a farmer is responsible for any accident 
 a workman may suffer in handling farm machinery, and I 
 take it that the same thing is true in France. Of course, 
 if a poor fellow earning 75 cents a day and having no means 
 of supporting his family becomes crippled for life by some 
 piece of machinery, it is not right that he should go all the 
 rest of his days as a pauper. On the other hand, it is hard 
 for the farmer to pay out a thousand dollars to take care 
 of some hired man whose serv^ices seem to have been worth 
 no more than the wages he received. It is the law, almost every- 
 where now, however, that a manufacturer is responsible for 
 accidents to his employees, and the same thing must become 
 the rule with regard to farmers — wherever it is not already 
 the law. In this situation the only thing for the farmers 
 everywhere to do is what they have already done in France 
 — secure collective accident insurance, not only for their 
 workmen but for themselves as well. So far as I could 
 gather, it seems that about five cents an acre is the accident 
 rate charged members of the farmers' union in France. For 
 example, if a man cultivates thirty acres, his premium would
 
 184 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 be $1.50 a year, the insurance covering not only his hired 
 men but himself, and all members of his family. 
 
 These agricultural syndicates also have done much to en- 
 courage agricultural teaching in the public schools; they 
 have systematically demanded that all members settle dif- 
 ficulties by means of arbitration instead of resorting to law 
 suits ; they have secured reductions in railway rates in many 
 cases, and in many other cases have combined to take ad- 
 vantage of special bulk rates not available to them as 
 individuals; and they have encouraged picnics, fetes and 
 social gatherings and other means of enriching the social 
 and home life of the country. 
 
 After all, however, it is probable that agricultural co- 
 operation in France is famed for no more notable achieve- 
 ment than the revolution it has effected in economical mar- 
 keting of farm products — although its rural credits reform 
 is very notable. French farmers not only have the low 
 parcels post rate which is such an advantage to English and 
 Irish farmers, but they have forced the French government 
 to raise the parcel post maximum rate to twenty-four 
 pounds instead of twelve. And not only have the farmers 
 been taught promptness and systematic business methods 
 generally, but they have found out the value of other 
 methods which we have not yet been progressive enough to 
 adopt — as for example, the plan of having all the farmers in 
 one community grow one breed of cattle or one breed of 
 hogs and so make a reputation for the neighborhood as the 
 place to find the best Jerseys or the best Angus or the best 
 Berkshires or the best Durocs. 
 
 Frequently, one local Union reports its needs to the other 
 unions in the district, and in this way exchanges are ef- 
 fected at a great saving to both buyer and seller. Especially 
 notable, moreover, are the results achieved by the society in 
 reducing rates paid commission merchants; and one in- 
 stance reported by Mr. Stopford is so important that I am 
 quoting the reference to it herewith:
 
 WHAT CO-OPERATION HAS DONE FOR FRENCH FARMERS 185 
 
 "On the markets of Paris and the large cities considerable success 
 has attended sales of vegetables, fruits, potatoes, onions, cut flowers, 
 etc., produce generally being collected in bulk and sold in the lots of 
 each member; or it was collected, divided into classes according to 
 quality by a committee of sale appointed in the general assembly. Each 
 day a different member did this work, so ordered that it was impos- 
 sible to tell beforehand who was to attend on any day ; this official was 
 paid for his work, he had the responsibility, and if claims were made 
 the syndicate covered the vendor — an arrangement which made this 
 method very satisfactory. Costs are deducted and the surplus divided 
 once a week in proportion to the quantity and quality each member 
 sent, and the market prices are duly published. Prices to the producers 
 were found to be raised 30 per cent by this means."
 
 CHAPTER XXIII 
 
 CO-OPERATION GIVES DANISH FARMERS THREE 
 PROFITS INSTEAD OF ONE 
 
 This Is Why Hans Hansen Makes a Good Living on Thirteen 
 Acres, and Why Denmark Is Indeed "A Little Land Full of 
 Happy People" — Importance of Home Ownership — How 
 the Danish Government Helps Farmers Buy Land — One- 
 Horse Farmers Combine and Do Two-Horse Plowing 
 
 THE first test of co-operation is its effect upon the 
 people who co-operate, and judged by this test 
 Danish co-operation scores brilliantly. Denmark 
 is about the most cheerful-looking country I have 
 ever seen. "A little land full of happy people," I heard one 
 Dane proudly call it ; and he was right. 
 
 Knowing that it is a country of such exceedingly small 
 farms, I should not have been surprised to find that the 
 people were hard put to it to live, but on the contrary, an 
 air of universal thrift and prosperity seems to cover the 
 whole kingdom like the sunshine. The neat little farm 
 houses are nearly all painted or whitewashed, even the out- 
 buildings; the people are clean, industrious, healthy, alert; 
 I saw hardly anybody ragged and but few expensively 
 dressed; and I didn't find in all the kingdom a single farm 
 animal showing its ribs. Although there are numerous 
 exceptions, I shall always think of Denmark as a place 
 where the people hold their heads up, the cattle are sleek 
 and glossy, the horses, even in the fields, step briskly as if 
 swift movement were a joy, and where every pig curls its 
 tail in well-fed satisfaction. The per capita wealth is 
 greater than in any other European country except Eng- 
 land, I understand, with this important difference: that 
 whereas in England there is a class of enormously rich, 
 
 186
 
 CO-OPERATION : THREE PROFITS INSTEAD OF ONE 187 
 
 and a multitude of miserably poor, Denmark is almost 
 equally free from millionaires and paupers. "Many of our 
 poorhouses are absolutely empty," one Dane said to me. 
 In short, Denmark seems to approach more nearly than 
 any other country I have ever seen to my ideal of a nation — 
 a place where nobody is rich enough to be idle, and nobody 
 poor enough to beg. This, perhaps, is too rosy a picture, 
 but I am only recording the impression this delightful coun- 
 try made upon me individually. 
 
 All in all, Denmark offers us a convincing illustration 
 of the truth of w^hat Froude, the historian, wrote — that 
 "national health is in exact ratio to the proportion of people 
 having direct interest in the soil." In other words, the 
 prosperity of the State depends upon the prosperity of its 
 agriculture. And while history teaches nothing more 
 plainly than this, it also teaches just as emphatically this 
 further truth, namely, that the prosperity of agriculture de- 
 pends upon three things: 
 
 (i) Land ownership. 
 
 (2) Education. 
 
 (3) Co-operation. 
 
 Those who would win for American agriculture the 
 strength, independence and prosperity which has been won 
 for Danish agriculture, should give heed to this trinity of 
 essentials. Co-operation is the capstone of the structure; 
 but the capstone is safe only when the foundation itself is 
 secure. The builders of the new Denmark were not un- 
 mindful of the Scriptural warning against building a house 
 upon the sand ; and it is because they first helped the farm- 
 ers get possession of the land, it is because co-operation with 
 them is founded upon the solid rock of ownership and edu- 
 cation, that it still stands four square to all the winds that 
 blow. 
 
 In Denmark nine acres out of every ten are cultivated by 
 the men who own them, and illiteracy is a thing unknown. 
 Says Minister Egan : "There is nobody in Denmark over 
 seven years old, unless he is an idiot, who cannot read and
 
 188 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 write"; and when I asked Mr. K. A. Jorgensen of the 
 Lyngby Experiment Station if he knew anybody who 
 could not read, his reply was that he could not think of 
 anyone then, but that when he was a boy he had 
 known some illiterate old men and women. About the 
 first thing I ever heard about Danish co-operation was that 
 it could never have succeeded but for universal compulsory 
 education and the people's high schools; and this is an 
 opinion about which I found everybody in agreement in 
 Denmark. It is fitting, indeed, that our now largest Amer- 
 ican farmers' organization is styled "The Farmers' Educa- 
 tional and Co-operative Union" — "educational" first and 
 "co-operative" second — for education must precede co-op- 
 eration. The other statement about which nearly every- 
 body in Denmark is agreed is that co-operation has suc- 
 ceeded so abundantly only because the great body of the 
 farmers own the land they till. 
 
 One of the first Danish small farmers I visited was Hans 
 Hansen of Ditlevshoj near Ringsted. Hans lived in America 
 awhile — out in Minnesota, I believe, where the thrifty 
 Danish population has given the Northwest some of its best 
 citizenship — and he talks English fluently. After showing 
 me over part of his farm, we went inside his neat cottage 
 home — made more homelike to me by the sight of an 
 American newspaper on his center table — and he smoked 
 his funny-looking, short Dutch pipe while we talked. 
 While out in our American Northwest, he told me, he had 
 a "quarter section," that is to say, a i6o-acre farm, but he 
 came back to Denmark about five years ago and took up 
 the thirteen-acre Danish "small holding" he is now on. 
 
 "And do you think thirteen acres enough?" I asked. 
 
 "Yah," he promptly replied. "I get along about as well with 
 thirteen acres now as I did with a hundred and sixty then. The 
 truth is, I'm thinking I could get along with a little less 
 than thirteen. I wouldn't have to work so hard." 
 
 Now, the reason Hans and his neighbors can make a liv- 
 ing on twelve or thirteen acres apiece, my readers have
 
 CO-OPERATION : THREE PROFITS INSTEAD OF ONE 189 
 
 already guessed. It is co-operation. They send their milk 
 to a co-operative creamery; they sell their pigs to a co- 
 operative bacon factory; their eggs are collected by the 
 co-operative egg-packing association; they have water in 
 their houses, pumped by a co-operative plant; they have 
 improved their stock through a co-operative breeding club ; 
 their grain is threshed by a co-operative thresher ; their beet 
 seed are planted with a co-operative sower; and though I 
 forgot to inquire further, I have no doubt but that they, like 
 a host of other Danish farmers, buy their seeds and fer- 
 tilizers through a co-operative purchase society, and insure 
 their stock in a co-operative insurance company. Indeed, 
 the very fact that they are on the land at all is due to co- 
 operation. They joined together to buy the soil they live 
 on — it was a large estate until a few years ago, when it was 
 divided up into these small holdings — and the government 
 plan whereby money was lent them at low rates for long 
 periods with which to buy the land, may itself be styled a 
 form of co-operation. 
 
 As nearly as I can make out the somewhat complicated 
 question (and I have made careful efforts to verify the 
 statement), the way these Ditlevshoj small holders bought 
 their farms was as follows : 
 
 (i) Each man had on his own account one-fifth of the 
 purchase price. 
 
 (2) Three-fifths of the price he borrowed from a co- 
 operative credit society on these terms : He pays interest 
 the first five years at 4 per cent ; after that he pays 4^ per 
 cent a year, 4 per cent of this amount counting as interest 
 and the remaining three-fourths of i per cent as sinking 
 fund, or amortization, to pay off the principal. 
 
 (3) The remaining one-fifth each purchaser borrowed 
 from the State (on second mortgage), paying interest at 
 the rate of 3 per cent. 
 
 This system, it will be seen, is somewhat akin to the Irish 
 land purchase act of 1903, which I have already described, 
 whereby the British government advanced to Irish farmers
 
 190 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 (under suitable restrictions, of course) the full purchase 
 price of the land they bought, repayment to be made in 
 68^ installments of 3J4 per cent, 2^ per cent being interest 
 and Yz per cent sinking fund. But the British government, 
 of course, lost money by this plan ; it could not itself borrow 
 at 2^ per cent, and I suspect that the Danish government 
 is also making some sacrifices in advancing money to land- 
 buyers at 3 per cent. At any rate, Mr. Christensen, the 
 obliging editor of the local paper who went out with us to 
 Ditlevshoj, told me that 5 to 5^ per cent is the normal rate 
 of interest in Denmark. "The Danish treasury," he told 
 me, "lends 200,000 kroner (about $54,000) a year to associa- 
 tions wishing to buy great estates for division among small 
 holders, no association being allowed to get more than 
 50,000 kroner ($13,500)." 
 
 This law, of course, is independent of and supplementary 
 to the general law for advancing money to individual small 
 holders, under which the State lends over $1,000,000 or 
 more, annually, directly to men of character wrishing to 
 buy land. A brief summary of this law may be given in 
 the exact words of Dr. Maurice F. Egan, the United States 
 Minister to Denmark: 
 
 "An agricultural laborer in Denmark, who has worked on a farm 
 for five years, who is poor, and who has a character so good that two 
 reputable members of his community will certify to it, may obtain from 
 one of these banks a loan of about $1,582 in our money. He obtains 
 this solely on his character and ability, and not by any material security 
 he can offer. With this money he may purchase a farm of from three 
 and a half to twelve acres. This farm means live and dead stock on 
 the land and the necessary implements for the working of it. The 
 amount loaned by the bank covers probably nine-tenths of the value 
 of the farm." 
 
 It should be added that the rate charged by the govern- 
 ment is only 3 per cent with i per cent additional for sink- 
 ing fund. "During the first five years no installment has 
 to be paid upon the loan ; thereafter interest and repayment 
 of two-fifths of the loan must be paid at the rate of 4 per 
 cent per annum; when this part of the loan has been paid
 
 CO-OPERATION : THREE PROFITS INSTEAD OF ONE 191 
 
 back, the remainder has likewise to be paid off at the rate 
 of 4 per cent per annum." 
 
 So much for the way co-operation and the government 
 help Danish small farmers like Hans Hansen buy their land. 
 Let us now inquire a little further as to how he and his 
 neighbors live, and how he can make a living on thirteen 
 acres, "and could get along with a little less." The secret 
 of his prosperity is that he is not content merely to make 
 one profit on his work — that of growing the crops. On the 
 contrary, we may say he makes three profits : 
 
 One profit from growing the crop; 
 
 A second profit from converting his crops into milk, butter, pork and 
 eggs; 
 
 A third profit from marketing these to the consumer. 
 
 In other words, Hans gets agricultural, manufacturing 
 and commercial profits: (i) Profits as a farmer for grow- 
 ing his crops; (2) profits as a manufacturer (in a sense) 
 through his dairying and stock-raising activities; and (3) 
 profits as a merchant, by reason of sharing the co-opera- 
 tive association dividends obtained in marketing his prod- 
 ucts. Xo people ever got rich merely by selling raw material 
 — a fact which explains why the South remains relatively poor 
 in spite of its enormous production. Danish agriculture pros- 
 pers because it is not merely a matter of growing raw ma- 
 terials. It is a well-organized commercial industry. 
 
 Moreover, Hans Hansen's land is doubtless getting richer 
 all the time. Nearly all Danish land is. Sixty years ago 
 the soil was getting speedily poorer, because Denmark was 
 a one-crop country, as the South has been, only the Danish 
 "one crop" was not cotton, but grain. But since the people 
 turned to diversified farming and stock raising, instead of a 
 one-crop system, the land has been growing in fertility all 
 the time. On his thirteen-acre farm, Hans keeps two horses, 
 five cows and a good many hogs — I have forgotten just how 
 many. Anyhow, he sent sixteen pigs to the bacon factory 
 last year, six-month-old fellows averaging 200 pounds live 
 weight.
 
 192 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 But after remarking that Hans' thirteen-acre place cost him 
 13,000 kroner, or $4,510 American, including land, stock and 
 buildings (part of the price being lent by the state at 3 per 
 cent), we must leave him to visit some of his neighbors. 
 One of these is Marius Yensen, who bought eight tondeland 
 (about eleven acres) five years ago, at about $100 per acre, 
 the land being then without buildings. Now his horse, his 
 six cows, his pigs, and his w^ife's Minorcas are housed under 
 the same roof as his family, a condition which obtains with 
 millions of other European farmers. Of course, in all such 
 cases a thick dividing wall must be provided between the 
 living apartments and the barn, and the stables must have 
 daily attention. But it would be a mistake for any reader 
 to think of Marius Yensen's cottage as dirty and unkempt. 
 It is pretty, built by an architect's plan, neatly whitewashed, 
 and the yard is dainty with flowers. 
 
 Yensen keeps a good breed of hogs and cows, of course — 
 nearly all Danish farmers do — and I saw one big brood sow 
 which has had 87 pigs in eight litters. His pigs, like Han- 
 sen's weigh about 200 pounds live weight when five or six 
 months old, and he got $540 from the co-operative bacon 
 factory for his pig sales last year. From the co-operative 
 creamery he received $405 for his cream, besides getting 
 his skimmed milk back for feeding his pigs and calves. 
 Then his wife's Minorcas, besides furnishing eggs for family 
 use, brought in the tidy sum of $54 from the co-operative 
 egg-packing association. It should also be remembered 
 that our Danish farmer friend is at no expense or trouble 
 for marketing his eggs and milk. The creamery wagon 
 comes for his milk pails as regularly as the sun rises, and 
 the co-operative egg wagon calls every Monday. 
 
 The representative of the "control society," or cow-test- 
 ing association — usually a young man who has studied 
 dairying in some agricultural college — makes a visit every 
 eighteen or twenty days, ascertains the quantity of milk 
 and amount of butter fat each cow is producing, and com- 
 pares the value of the feeds given her with the value of her
 
 CO-OPERATION : THREE PROFITS INSTEAD OF ONE 193 
 
 milk. "Ill fares that cow to hastening doom a prey" which 
 does not show a profit! The secrets which the "robber 
 cow" once successfully concealed, are now proclaimed from 
 the housetops — or, it would be more accurate to say, from 
 the butcher's block. Largely because of the activities of the 
 control association and the resultant discovery and disposal 
 of the "undesirable citizens" in the dairy barns, the average 
 Danish milk production per cow increased from 4,500 
 pounds in 1898 to 5,865 pounds in 1908 — a gain of over 
 30 per cent in a single decade. Moreover, Professor Ras- 
 mussen of the New Hampshire Agricultural College, a Dane 
 by birth, assures me that the average milk production per 
 cow in Denmark has actually doubled in twenty-three years. 
 Yensen's own cows averaged 8,800 pounds of milk last year. 
 
 About this time it seems to me I can hear some of my 
 readers saying, "Well, Friend Poe no doubt liked that Den- 
 mark farmer's fine stock, and his careful rotation, and his 
 progressiveness in patronizing a co-operative creamery and 
 bacon factory, but there is one thing he must have objected 
 to, and that is, that with such small farms about all the 
 plowing must be of the one-horse sort." 
 
 But to all such readers I would say, Not so fast! The 
 presumption is a natural one, but as a matter of fact, co- 
 operation which helps Yensen in so many other ways, helps 
 him here also. He does no one-horse plowing. The truth 
 is, one-horse plowing is an unusual sight anywhere in the 
 Danish kingdom. One of the secrets of its prosperity is 
 that it has more horses per square mile than any other coun- 
 try on earth — an average of thirty-two — and while here and 
 there a small holder like Yensen, with only ten or twelve 
 acres, and that not quite paid for, may have only one horse, 
 even then he usually thinks too much of his time and of his 
 land's time, to waste either with one-horse plowing. When 
 Marius Yensen wants to plow, he borrows another horse 
 from a neighbor, and in return Yensen lends his horse to 
 the neighbor when the neighbor needs it. 
 
 That is true co-operation for you!
 
 CHAPTER XXIV 
 
 COWS AND CO-OPERATION HAVE MADE 
 DENMARK RICH 
 
 Co-operation, Scientific Knowledge, Strict Business Policies, 
 and High-Quality Products Are the Four Secrets of Success 
 — How the Co-operative Societies Were Started Without 
 Capital — Plans of Payment — Necessity for Binding Legal- 
 Form Agreements Among Co-operators — Inspection to In- 
 sure Quality of Product 
 
 THE SCRIPTURES speak of Palestine as "a land 
 flowing with milk and honey." In view of the 
 great number of cattle and hogs in Denmark, it 
 might be called a land flowing with milk and 
 gravy. "Like ancient Gaul," says Minister Egan, "all, Den- 
 mark is divided into three parts — butter, bacon and eggs." 
 And he might have added that of these three the greatest 
 is butter. 
 
 I have already remarked that there are more horses to 
 the square mile in Denmark than in any other country the 
 sun shines on, and I believe the same thing is true with regard 
 to cows. At any rate, there are 442 milk cows for each 
 thousand of the population, as compared with 224 dairy 
 cows for each thousand Americans. 
 
 The first Danish co-operative creamery was established 
 thirty years ago. Undoubtedly it would be rash to assume 
 that one cow in a hundred was then enrolled in the co-op- 
 erative ranks, but now more than eighty cows in every 
 hundred arc fashionable, up-to-date, co-operative cows and 
 less than twenty are left untouched by the modern spirit. 
 Of the 1,507 creameries in Denmark on the latest date for 
 which I have the figures, only 242 were private and 85 
 
 194
 
 cows AND CO-OPERATION HAVE MADE DENMARK RICH 195 
 
 estate, while 1,177 were operated on the co-operative basis. 
 
 These Danish co-operative creameries on w^hich Eng- 
 land's hungry millions have learned to rely for their butter 
 supply were formed, almost without exception, without the 
 members paying out one cent as capital to start on. "At 
 first we had the banks all against us," Mr. J. H. Monrad, 
 the well-known dairy expert, told me, "but now we can get 
 anything we want simply on the principle of united and 
 solitary responsibility — a guarantee signed by all the mem- 
 bers. There is almost no chance of failure, and the mem- 
 bers do not hesitate to sign the notes. Then we agree to 
 pay the bank the usual rate of interest — say, 5 per cent — • 
 and to pay back at the rate of 10 ore (10 ore is not quite 
 three cents American money) for each 100 pounds of milk 
 handled. Then the bookkeeper in paying the farmers for a 
 hundredweight of milk deducts not only the fixed rate for 
 expenses, insurance and interest, but also the three cents 
 that goes to pay ofif the debt. Suppose, for example, a 
 farmer would otherwise net $1.15 per hundredweight for his 
 milk, then a deduction of three cents would leave him $1.12. 
 Usually the rate of repayment is so figured as to clear off 
 the debt in seven to ten years, but it has happened that 
 creameries have paid out completely in four years." 
 
 There is one other principle religiously observed in all 
 these co-operative creameries and other Danish co-opera- 
 tive enterprises which Mr. Monrad insisted that I must 
 emphasize in writing of the subject for American farmers — 
 the principle of having all contracts absolutely definite, 
 binding, compulsory and businesslike. And in this I am 
 sure that he is right. If we don't mean business about this 
 matter of co-operation — straightout, thoroughgoing, 
 Yankee-like "business" — w^e might as well let it alone. Co- 
 operation, I am thoroughly convinced, is the greatest dis- 
 covery of modern times for the betterment and uplift of 
 our farming people, but like everything else worth having, 
 something must be sacrificed to get it. Farmers cannot 
 simply enroll their names as members of a co-operative
 
 196 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 society and then float into an earthly Paradise on flowery 
 beds of ease. City business men cannot succeed unless the 
 members of their partnerships or corporations are strictly, 
 definitely, legally, bound up to do certain things, and farm- 
 ers cannot make all the middleman's profits unless they are 
 willing to take some of the middleman's risks. Let's make 
 up our minds to that. But the farmer has this advantage, 
 that while loss to a business man often falls heavily on an 
 individual, loss in a co-operative enterprise, in the rare 
 cases where it has happened at all in Denmark, has been 
 so widely scattered as to seriously handicap nobody. 
 
 "You must make your American farmers resolve on the 
 compulsory feature in the very beginning," Mr. Monrad 
 said to me. "Great as are the advantages for co-operation 
 here in Denmark, our farmers would nevertheless have 
 failed in great measure — just as the German farmers would 
 also have failed — if we had not had the compulsory feature 
 inserted in all our agreements. When a creamery is started, 
 each subscriber agrees to deliver all his milk that is not 
 required for family use for ten years to come — sometimes 
 it's seven years, but usually it's ten — to the new establishment." 
 
 And this promise is no mere expression of intention, but 
 a definite, binding, legal agreement that can be enforced 
 in the courts, and damages can be collected from any man 
 violating it. Thus if a man has agreed to deliver milk from 
 five cows, he will be responsible to the creamery if he sells 
 his farm without requiring the purchaser to assume his 
 obligation and continue to send the milk from five cows. 
 The other day a case came up where a man who had agreed 
 to deliver all his milk had increased his herd, and from his 
 newly-bought cows had sold milk to the city instead of the 
 creamery. Thereupon the creamery sued him, and the 
 court directed that he be fined not to exceed $500, the exact 
 amount to be fixed by a disinterested committee. 
 
 Of course, all this is nothing but businesslike. Ordinarily, 
 it requires milk from about 400 cows to insure the success 
 of a creamery, and it would be poor business to start one if
 
 cows AND CO-OPERATION HAVE MADE DENMARK RICH 197 
 
 on some excuse or other half the members might pull out 
 and leave the creamery without sufficient milk supply to 
 make its operation profitable. Suppose, for example, in 
 some neighborhood there was a rival creamery that wished 
 to break up the co-operative creamery. If there were no 
 compulsory provision in the co-operative creamery con- 
 tracts, the other creamery might for a time offer unwar- 
 rantably high prices and so entice away a sufficient num- 
 ber of co-operative creamery members long enough to 
 break it up. If we are going into co-operation here in 
 America, we must have definite, binding agreements in 
 every case — and agreements covering a sufficient product 
 to insure success. 
 
 The Kildevang creamery near Ringsted which I inspected 
 may be regarded, I suppose, as fairly typical, in essential 
 things, of the other twelve hundred co-operative creameries 
 in Denmark. "Kildevang" was started twenty-three years 
 ago with 300 cows and a debt, but is now patronized by 
 120 farmers with 800 cows, and has nearly paid for itself 
 out of installments, besides the profits returned directly to 
 the farmers. I failed to inquire, but I suspect that the 
 plant has been enlarged and that the installments now pay- 
 able are for the addition to the original plant. This cream- 
 ery sends out nine wagons every sun-up to collect the milk, 
 and produces, I was told, 385 pounds of butter daily, and I 
 don't know how much cheese. Its yearly income is $54,000, 
 and for the last six months period for which I have the 
 figures, it appears to have made a profit after paying all 
 expenses and installment on debt, of 10,794 kroner — about 
 $2,914.38, or at the rate of about $50 a year profits for each 
 farmer. Of course, however, the profits are not divided 
 per capita among the farmers, but each farmer receives 
 dividends exactly in proportion to the quantity of butter 
 fat he has furnished. In business management, moreover, 
 Danish creameries are absolutely democratic. In the busi- 
 ness meeting every member has one vote, whether he fur- 
 nishes milk from five cows or fifty.
 
 198 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 A large part of the farmer's golden reward is due to the 
 fact that the co-operative enterprises are able to "standard- 
 ize" their products and get correspondingly higher prices, 
 as an individual farmer is not. A co-operative creamery, 
 bacon factory, or egg-packing factory is able to establish 
 a standard of quality and guarantee this standard to the 
 consumer. Most farmers are not as careful as they ought 
 to be, and where a farmer is careful to give good quality 
 every time, his reward is slight because he is too small a 
 factor to be considered by the market. But on the large 
 markets a large group of farmers can demand and secure 
 higher prices for higher quality products. Jim Smith may 
 produce butter of superb quality, for example, with small 
 reward; but Jim Smith's county may make a reputation 
 which will mean added profit for every producer in every 
 shipment. 
 
 So it has been with Danish butter. Before the day of the 
 co-operative creamery most of it was bad, and what wasn't 
 bad fared after the fashion of poor dog Tray in the Blue- 
 back speller — it was punished because it was in bad com- 
 pany. "Before the co-operative creameries," said a thought- 
 ful Danish farmer to me, "the farmers could hardly sell 
 their butter at all. It was so dirty England wouldn't have 
 it at any price." What "peasant butter" was sold at all 
 brought one-third less than the regular creamery product. 
 Now Denmark boasts that there is only one quality of 
 Danish butter — good. "Second-class and third-class butter 
 has disappeared from the market." 
 
 A great part of the co-operative creamery's profit is due 
 to saving the middleman's charges, but my conviction is 
 that about as large a part is due to the fact that it is 
 able to guarantee its customers absolute regularity in 
 quality and almost absolute regularity in quantity of 
 butter furnished. Take Kildevang as an example. Not 
 only is everything about the place appetizingly clean, but 
 every single time a pound of butter goes back to a patron 
 (and, of course, the patrons get their own family butter
 
 cows AND CO-OPERATION HAVE MADE DENMARK RICH 199 
 
 from the creamery instead of depending on the old-fash- 
 ioned dasher churn) a notice is inclosed reminding the 
 farmer over and over again w^ith what must be almost 
 exasperating reiteration just what he must do in order to 
 have his milk supply acceptably clean. "Kun God Maelk 
 Giver Smor" ("Only Good Milk Makes Fine Butter") is 
 the heading set in big type ; and the regulations as a whole 
 cover what we might call the ten commandments of good 
 and cleanly dairying. 
 
 Moreover, since Noah Webster's fables have come to 
 mind, I may remark that the Danish creamery managers, 
 following the example of the old chap who found the saucy 
 boy up his apple tree, do not look upon soft words as the 
 only legitimate means of persuasion. If these fail, then, 
 figuratively speaking, "they try what virtue there is in 
 stones." Rider Haggard says of the Brorup Co-operative 
 Dairy : 
 
 "All milk supplied is sampled by experts once a week. If any par- 
 ticular lot does not come up to the standard the farmer is warned, and 
 if the deficiency in fat or other imperfection continues, his milk is re- 
 fused. This rarely happens, however, as the result of such a warning 
 is that the quality of the aspersed milk improves." 
 
 Moreover, "Sis .Cow," as Uncle Remus would say, must 
 be watered amply if she is to give milk, and it looks odd 
 to see vehicles like our city water wagons traversing the 
 fields for her refreshment. Running water is not very 
 plentiful in the tile-drained fields (nearly everything is tile- 
 drained in Denmark), but windmills — quaintly picturesque 
 old Dutch affairs here and there side by side with new 
 American-looking steel ones — pump water easily ; and wind, 
 they observe, is cheap and plentiful. Moreover, here is an- 
 other chance for co-operation, and a Dane had rather miss 
 his dinner than a chance to co-operate. Marius Yensen, 
 Hans Hansen, Peter Villadsen, and the other small holders 
 mentioned in my last chapter, together with fifteen other 
 small farmers, jointly own a windmill which I found sup-
 
 200 
 
 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 plying water to all the eighteen families clustered in the 
 community. 
 
 Cows and co-operation — this is the team all Denmark is 
 betting on ! Not only have the creameries doubled the 
 farmer's profits on the same quantity of milk, but the "con- 
 trol society" or cow-testing association, to which I have 
 already referred, is teaching him to get rid of his unprofit- 
 able cows and so double his profits again as a result of keep- 
 ing cows of better quality. In 1907, the cows owned by 
 members on the control association averaged 6,344 pounds 
 each, while those owned by farmers who were not members, 
 averaged only 5,643 pounds. There has never been the 
 slightest disposition to ignore the importance of scientific 
 farming among these Danish co-operators ; there has been 
 no foolish scoffing at "book farming." "We are going to 
 get everything we can both out of better means of produc- 
 tion and better means of distribution," has been their motto, 
 and they have made double profits for this very reason. If 
 I had to name the three things that are almost equally 
 responsible for the Danish dairyman-farmer's full pocket- 
 book, I should say : 
 
 (i) Scientific and economical production, due to thorough 
 study of the principles of dairying and farming in farm 
 papers, farmer's bulletins and extension work. 
 
 (2) Scientific handling and marketing, due to co-opera- 
 tive effort along strict business lines ; and — 
 
 (3) The extra top-notch prices obtained through ability 
 to enforce from producers and guarantee to consumers ab- 
 solute cleanliness and a high quality product.
 
 CHAPTER XXV 
 
 AVERAGING $2 MORE PER HOG THROUGH 
 
 CO-OPERATION 
 
 That Is the Net Result to Danish Farmers — An Interesting 
 Visit to a Co-operative Bacon Factory and a Co-operative 
 Egg-Packing Plant — Importance of Standardising Products 
 Again Emphasised — $2.yo Fine for Sending a Bad Egg 
 
 NEXT to the co-operative creameries, we find in the 
 "bacon factories" or slaughter houses, as they are 
 usually called in English, the most important form 
 of Danish co-operation. I was told in Copen- 
 hagen that there were thirty-nine of these establishments, 
 a figure which compares with one in 1888, seventeen in 1895, 
 and thirty-two in 1905, a very steady increase in the num- 
 ber in operation. Over a million and a half pigs are slaugh- 
 tered every year, or three times as many pigs as there were 
 in all Denmark thirty years ago — a million and a half pigs 
 a year, observe, in a country with just a little larger popula- 
 tion (2,757,057) than an average American state, and not 
 one-third the area (15,582 square miles). While Denmark 
 is a kingdom all to itself, therefore, we must always keep in 
 mind that it is only about the size of three or four congres- 
 sional districts in America. 
 
 Personally, I found the Ringsted Bacon Factory one of 
 the most interesting places I visited, as I had gone through 
 too many personal experiences in hog killing, scalding, 
 scraping, etc., on cold November sun-ups for the place to 
 disturb me; but the manager, Mr. Jens Piil, told me that 
 when Mr. Rider Haggard visited the place he left almost 
 before he got there — as that gentleman himself confesses. 
 The Ringsted factory collects pigs from all the country for 
 
 201
 
 202 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 ten miles around, now has 3,300 members, and slaughters a 
 thousand pigs a day — one and a quarter a minute during 
 working hours. The Biblical saying about the grass 
 "which today is and tomorrow is cast into the oven" 
 came vividly to mind, for the conversion from live pigs into 
 pork ready for curing is almost oppressively sudden. I 
 didn't make an investigation for myself upon this point, but 
 a man who did, says: 
 
 "I timed by my watch a pig from the moment he was stuck to 
 where the carcass had been scraped, inspected, cleaned and divided in 
 half, ready for the government inspector's stamp (which is burned on 
 the side with a factory stamp befoie going into the cooling rooms), 
 and it was exactly twenty minutes, and the work was most thoroughly 
 done." 
 
 It would hardly interest the reader, or delight his aesthetic 
 sense, to describe the slaughtering operations. When 
 David B. Hill was returning from a National Democratic 
 convention once he remarked that "Presidents are like 
 sausages : you like them better if you don't see them made" ; 
 and it is a good deal the same way with all pork products. 
 Suffice it to say that all the latest improved appliances such 
 as Armour and Cudahy use in America, will be found in 
 these Danish factories, and every operation is conducted 
 in a thoroughly scientific, economical and businesslike man- 
 ner. Fifty-two men are employed at Ringsted and every 
 man knows his job and does it. Moreover, here, as in Chi- 
 cago, they "save everything about the pig except the 
 squeal." After passing through the cooling rooms with 
 their fresh carcasses, the enormous curing vats, and the lard 
 department, we entered the sausage department where an 
 automatic sausage-stuffing machine was doing its work with 
 a celerity that would amaze our American farmers, and next 
 discovered that even the blood of the slaughtered hogs is 
 carefully saved, mixed with grain and molasses, and sold 
 as a pig feed ! The livers were formerly exported to Ger- 
 many, but about 1903 Germany passed a law forbidding
 
 AVERAGING $2 MORE PER HOG THROUGH CO-OPERATION 203 
 
 their importation, whereupon these resourceful Danes rose 
 immediately to the emergency. The bacon factory man- 
 agers "put their heads together and drafted leaflets with the 
 aid of experts, embodying recipes for making delicate and 
 savory dishes from pigs' livers." These recipes were scat- 
 tered over Denmark, with results that were quickly ap- 
 parent. 
 
 I have already remarked that the co-operative creameries 
 in Denmark have probably increased the farmer's profits 
 quite as largely by requiring and guaranteeing a uniform high 
 quality as by saving middleman's profits. There is, of 
 course, not so much room for variation in quality of pork, 
 but here, too, co-operation has come to the aid of both 
 producers and consumers with good results to both. In 
 Ringsted, as in other co-operative bacon factories, I found 
 an official inspector at work before whom the secrets of all 
 pigs' hearts (and stomachs) stood revealed as the dead 
 march passed in review before his ever-scrutinizing eye. 
 Every carcass exported must bear the inspector's stamp, 
 certifying it as either first-class or second-class meat. 
 "Ninety-three per cent of the pigs pass the inspector as 
 being thoroughly sound," Manager Piil told me, "seven per 
 cent are found diseased. Usually the removal of some es- 
 pecially diseased portion leaves the rest of the pig all right, 
 and only one-third of i per cent of the carcasses have to be 
 rejected altogether." 
 
 From its small farmer patrons, I was told, the Ringsted 
 establishment gets about ten pigs a year each, from owners 
 of medium-sized farms, thirty to forty pigs each, and from 
 others eighty to one hundred. 
 
 The space I have left will only allow me to refer briefly 
 to the business side of these co-operative slaughter houses. 
 We have all heard of "wheels within wheels," and this is 
 what one finds almost everywhere in studying co-operation 
 in Denmark. The bacon factories are themselves co-op- 
 erative and then they co-operate in mutual insurance of their 
 products, and in mutual accident insurance for their work-
 
 204 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 men, and in mutual insurance against losses through labor 
 strikes — although I confess I never heard of a strike in 
 Denmark, 
 
 The Ringsted factory, I should not omit to state, was 
 started sixteen years ago, with less than i,ooo members, as 
 compared with the 3,300 it has today, and it then took care 
 of only 400 pigs a week in busy seasons, while it has recently 
 handled 2,000 a week. The farmers borrowed the money 
 to build the plant, and have paid out of the profits for the 
 equipment $43,200, besides the other profits paid directly 
 to the farmers. In fact, all these bacon factories and 
 slaughter houses seem to have paid handsomely. Ten per 
 cent a year seems a usual dividend ; and one plant in fifteen 
 years paid out from its profits $40,000 for equipment, be- 
 sides paying each farmer-member 78 cents bonus for every 
 pig furnished in addition to the full market price. An Irish 
 deputation which visited Denmark several years ago, found the 
 Roskilde society paying a bonus of 73 cents per hundred- 
 weight, Haslev 84 cents, Horsens and Kolding 92 cents. 
 In other words, the farmers received profits or dividends of 
 from $1.46 to $2.84 on each 200-pound hog delivered, in 
 addition to top-notch market prices. It is not hard to con- 
 vert people to the benefits of co-operation where you can 
 present such argument as that ! 
 
 In the bacon factories, as in the creameries, there is abso- 
 lutely equal suffrage. Every member has one vote, and 
 only one, in the yearly meetings. "It doesn't matter 
 whether a man furnishes one pig or one hundred," Manager 
 Piil said to me. "When we have our annual meeting in 
 February, all have the same voice as to the business affairs 
 of the organization. An executive committee of eleven is 
 elected, which meets monthly for the general conduct of 
 the business." 
 
 I had intended writing at some length of the Ringsted 
 Co-operative Egg-Packing Society, but must dismiss it with 
 a paragraph. In many respects it is like the Irish poultry 
 society I have already described, but unlike that institution
 
 AVERAGING $2 MORE PER HOG THROUGH CO-OPERATION 205 
 
 it collects eggs weekly insteady of daily. Every Monday 
 morning it sends out twenty-eight wagons over a radius of 
 eight miles and gathers in eggs from 2,000 members. 
 
 It also handles poultry, and I was interested in investigat- 
 ing the system of artificial fattening or "cram feeding" 
 which is practiced in the winter months. For two weeks 
 the unwilling birds have milk dough pumped into them, and 
 the society last year sold 3,000 birds thus fattened at from 
 24 to 2"] cents a pound. 
 
 Most of the business, however, is in eggs, and here the 
 greatest care is exercised. A woman "candles" every ^^^ — 
 that is to say, examines it by looking at it in an egg-testing 
 apparatus, the lights indicating its freshness. Farmers are 
 supposed to deliver to the wagons each Monday only the 
 eggs laid the week before, and the remorseless tester is very 
 likely to discover any violation of this regulation. If by 
 any chance, however, an ^^g should succeed in deceiving 
 the very elect who conduct the "candling" tests, it would 
 still have to reckon with a yet more relentless day of judg- 
 ment, for each ^^^ is rubber-stamped with the initial and 
 number by which the farmer is known. For example, "F. 
 97" means farmer No. 97 in Society F. A slip is inclosed 
 with each box of eggs asking the purchaser, in case any t.g'g 
 proves unsound, to report its number to the society, 
 and the society promptly hunts down "F. 97," or whoever 
 the offender may be. 
 
 "If a man sends a bad t^^^ the manager informed me, 
 "he is first reminded of his offense. Then, if it is repeated 
 so soon as to indicate carelessness, he is fined five kroner 
 >($i.35) ; for the third oft'ense, $2.70; and if he persists in 
 evil-doing, he is expelled." 
 
 Quality, quality — that is the watchword in all Danish co- 
 operation. The societies demand quality; enforce quality, 
 guarantee quality; and they could never have succeeded 
 in winning such profits for their members if they had not 
 been whole-heartedly determined to give an absolutely 
 square deal to every customer. Every creamery, every
 
 206 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 slaughter house, every egg-packing institution, feels itself 
 in some sense a trustee of the reputation, the good name, 
 of Denmark, of Danish farmers, of agricultural co-operation ! 
 Even the humblest peasant shares the feeling. 
 
 "I'll give you one of the big secrets of our success," a 
 very intelligent farmer said to me. "It's in the form of an 
 incident a Swedish authority observed when investigating 
 our egg export business. While traveling across the coun- 
 try just after he got here, he came to a little cottage where 
 an aged houseman's wife was carefully cleaning the last 
 one of a big basket of eggs. 
 
 " 'Mother,' he said to her, 'you seem to be wonderfully 
 particular to rub off every spot.' 
 
 " 'Yes, sir, stranger,' was her prompt reply, 'don't you 
 know that we must have nice and clean eggs for the honor 
 of Old Denmark?' 
 
 " 'And right there,' the Swede continued, 'I knew that I 
 had found out one of the main explanations of the great suc- 
 cess I had come over to investigate.' "
 
 CHAPTER XXVI 
 
 "FOLK HIGH SCHOOLS" RESPONSIBLE FOR 
 SUCCESS OF DANISH CO-OPERATION 
 
 Denmark Has Not Only Good Primary Schools and Compul- 
 sory Attendance, but a Remarkable System of "People's 
 High Schools" — These High Schools Make Ideal Social Cen- 
 ters — Ignoring Stereotyped Formulas, They Aim to Prepare 
 Students Not for College but for Efficient Living in Their 
 Own Neighborhoods 
 
 THE farmers rule the roost in Denmark," Mr, Mon- 
 rad said to me as we talked together in Copen- 
 hagen. "It is not a lawyer-bossed country such 
 as you have in America, where lawyers outnum- 
 ber all other classes in Congress, in the Legislatures, and 
 in the party councils." Mr. Monrad had lived in America 
 several years, and knew what he was talking about. "In 
 our Rigsdag or Congress," he continued, "the farmer mem- 
 bers have an absolute majority." 
 
 The explanation of all these things is not far to seek. If 
 three things — Ownership, Education and Co-operation — ex- 
 plain the Danish farmer's prosperity, two things — Educa- 
 tion and Organization — explain his political power. Organ- 
 ization alone will not do the trick. You might organize 
 ten thousand men in your county tomorrow into an army, 
 but if they had not been "educated" for their work — that is, 
 if they had not been trained to shoot and to march and to 
 maneuver — they would go to pieces in a minute before a 
 thoroughly organized and disciplined — that is to say, thor- 
 oughly "educated" — German battalion. So our farmers, no 
 matter how well organized, will fail, in great measure, 
 unless they are educated, unless they read and study and 
 
 207
 
 208 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 plan as wisely as the great body of the educated and or- 
 ganized forces with which in a democracy they must always 
 contend. 
 
 Let me give my readers here the sign and password of 
 the Danish farmer's success. I found the sign at the first 
 farmers' school I visited in Denmark — the Kare- 
 have "Husmandskole," near Ringsted. It is the 
 emblem of this school to which so many farmers 
 come for short courses, and might well be the 
 emblem of many a similar institution in America 
 — an owl and a spade united, the owl represent- 
 ing knowledge, the spade representing labor. 
 "It means 'Wisdom and Work' " ( Visdom 02 
 Arheida), we were told, and our entire party 
 agreed that it might well be taken as the emblem 
 of the new Denmark. And it is, indeed, because 
 the Danish farmer has combined Wisdom and 
 Work, Learning and Labor, Education and Energy that he 
 rules his kingdom and divides to every man the fruit of 
 his labors. 
 
 While, of course, it is to the splendid system of compul- 
 sory public school education that we must look for the 
 secret of the Danish farmer's intellectual progressiveness, 
 the Karehave school itself is about as good an illustration 
 as one could wish for to emphasize the general thirst for 
 knowledge. "Husmandskole" it is called, or "Housemen's 
 School" — houseman being the Danish word for small 
 farmer. No one under eighteen is admitted, and the in- 
 struction the boys and men receive is agricultural in char- 
 acter, their term lasting, I believe, from October to May, 
 while the May-to-October session for the girls and women 
 looks to helping them in cooking, housework, poultry keep- 
 ing, gardening, etc. 
 
 Karehave's greatest service to the farmers of Denmark, 
 however, is doubtless rendered through its "short courses" 
 — eleven-day courses in such subjects as dairying, stock 
 feeding, poultry raising, special crops, etc. — eighteen of
 
 "folk high schools" responsible for success 209 
 
 these courses being given each year, one beginning the first 
 Tuesday and another beginning the third Tuesday, in nine 
 months of the twelve. It was inspiring to see the grown 
 men and women who had come for these courses, when I 
 visited the school ; middle-aged farmers, smoking their 
 crooked pipes, walked across the campus in company with 
 their gray-haired wives who had come to find out how 
 science could help them in their work. "Frequently the 
 husband comes first and takes the agricultural course," I 
 was told, "and is so much pleased that he has his wife come, 
 or perhaps comes back with her. Or perhaps the good 
 woman is more alert and progressive than her husband, 
 in which case she is not rarely the first one to find out the 
 helpfulness of the school and come." Aged men and women, 
 such as would seldom tkink of such a thing in America, 
 renew their youth and refresh their minds with new-found 
 knowledge at Karehave. "I believe you have had one 
 student seventy-two years old," Editor Christensen said to 
 Professor Nielsen of Karehave, as we talked together. "No, 
 we have done better than that," Professor Nielsen replied. 
 "We have had one pupil enrolled who was seventy-six, and 
 at one time we had two pupils past seventy years old !" 
 
 Perhaps, just as Denmark is said to have "the microbe 
 of co-operation," it also has some microbe that keeps men 
 always eager to learn more. At any rate, when I called 
 by the American Embassy in Copenhagen the day I sailed 
 to tell Dr. Egan good-bye, I found him assiduously engaged 
 in a French lesson — and he is sixty-four! 
 
 But what Danish educators chiefly boast of is their sys- 
 tem of "folk high schools," attended by thousands and 
 thousands of young men and women, from eighteen to 
 twenty-five years old. These schools differ a great deal 
 from our American high schools, which, as a Dane said to 
 me, too often aim only at preparing a boy or girl for college 
 or the university, whereas the Danish people's or "folk'* 
 high schools aim at preparing for life, industry and citizen- j 
 ship. The reader will observe that the Karehave school^
 
 210 now FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 I have just been describing is an institution for technical 
 instruction in agriculture and domestic science, and does not 
 belong to the type of "folk high schools" or "people's high 
 schools" I shall now briefly discuss. 
 
 So far as I know, there is nothing anywhere else in the 
 world quite like these "Folk High Schools," and they 
 deserve the careful study of all our people who are inter- 
 ested in the improvement of country life. In Denmark 
 these folk high schools are the true "social centers," 
 which should form the heart of every country neighborhood, 
 and they no doubt account largely both for the unusual 
 spirit of comradeship and the high average of intelligence 
 throughout the country. 
 
 These schools are not given over to formal text-book 
 lessons and examinations, but the instruction is almost 
 entirely in the form of public lectures, followed by discus- 
 sions, questions, answers, etc., the general aim being to 
 stimulate character building, good fellowship, and patriot- 
 ism in the pupils, "developing the heart, mind and will," 
 as it is expressed. They study all the best Danish litera- 
 ture, a special object being to develop the reading habit; 
 history gets a very large part of the time ; agriculture 
 is studied in many schools; geography, mathematics, Eng- 
 lish, gymnastics and athletics are given attention ; and a 
 special effort is made to furnish adequate instruction in 
 health subjects — physiology, hygiene and sanitation. An 
 important aim is that of stimulating patriotism, and the 
 singing of the beautiful national songs is done with such 
 enthusiasm and inspiration that a foreigner doesn't need 
 to know the words in order to realize their beauty. Old 
 and young alike come to these lectures, and nearly every 
 visitor to Denmark goes back with some story of the crowds 
 he saw — some walking, some driving, some on the ever- 
 present bicycle — all bound for the neighborhood high school 
 to hear the public lectures. As Mr. Monrad said to me : 
 "The people's high schools may be said to aim simply at 
 arousing a craving for more knowledge and e\:.Iltually self-
 
 "folk high schools responsible for success 211 
 
 improvement, but originally it was a half-religious, half- 
 patriotic propaganda which proved a cornerstone for the 
 co-operative building, or — if you please — a fertilizer for the 
 co-operative tree." 
 
 To provide a broader culture for the great masses of the 
 people ; to get them to read and think and love their coun- 
 try and their fellows; and to promote a spirit of good fel- 
 lowship and bind the neighborhood together both in indus- 
 trial and intellectual activity — this is the great purpose of 
 the folk high schools, and most remarkably do they succeed 
 in carrying it out. 
 
 Every boy and girl, or young man or woman, must go to 
 the high school if he or she is really to "count" in the neigh- 
 borhood. "Not to go, is a social loss," as Dr. Egan puts it. 
 The young men spend the five winter months, November 
 to March inclusive, and the young women the three sum- 
 mer months, June, July and August, as boarders in 
 these schools, and here I must emphasize the universal 
 opinion that the acquaintances and the spirit of comradeship 
 formed in these schools, along with the high degree of in- 
 telligence they insure, explain, in great measure, the success 
 co-operation has attained. "These high schools are the 
 basis of the agricultural development," Minister Egan has 
 repeatedly declared in his American lectures ; and Dr. Her- 
 bert G. Smith is only stating a matter of common knowledge 
 when he says in his "Agricultural Co-operation" : 
 
 "The leaders of the movement in Denmark attribute the capacity for 
 organization among the Danish farmers to two chief causes — namely, 
 the education given to the peasants in the rural high schools, and the 
 division of the land among the small free holders." 
 
 "No, we could never have won the success we have with- 
 out the folk high schools," the first Dane I interviewed 
 declared ; and the last one echoed the same opinion. "It is 
 in them that the people learn fellowship and good will," 
 was his explanation. One important point to keep in mind 
 is that there are no examinations in these folk high'
 
 212 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 schools, SO a young man or young woman is not barred out 
 simply because he or she may happen to be a little backward 
 in some particular study, "or not know the exact shade of 
 Julius Caesar's hair." This is, indeed, a great advantage. 
 
 But the big fact to keep in mind is, that it took a thorough 
 system of education — not merely common schools, and com- 
 pulsory attendance, but high schools also — to enable the 
 Danish people to win the success, independence and pros- 
 perity they have achieved. 
 
 I neglected to ascertain what appropriation the govern- 
 ment now makes to these people's high schools, but Mr. 
 Monrad tells me that "$68,499 is distributed through local 
 authorities and agricultural or dairy associations to aid 
 worthy students in paying for their school expenses." And 
 here is a good lesson for some of our American states which 
 are lavish in their support of universities and higher institu- 
 tions of learning for the benefit of the fortunate few, but 
 utterly neglect the great masses of farm boys and girls 
 who cannot think of entering a college, but ought to have 
 special training in practical middle schools after leaving 
 the regular public schools. Why should we not extend 
 more help to farm boys and girls who wish to attend agri- 
 cultural high schools or take short courses in agricultural 
 colleges? 
 
 How popular these "folk high schools" are in Den- 
 mark, and how ready the people are to rally to their support 
 is indicated by one incident that came to my attention. A 
 few years ago one of the schools got into financial difficul- 
 ties of some kind that threatened its future, and one thou- 
 sand farmers joined in raising a fund for its deliverance!
 
 CHAPTER XXVII 
 
 SEVEN SECRETS OF SUCCESS WITH DANISH 
 
 CO-OPERATION 
 
 The Stock Breeding Associations and Rural Credit Unions 
 Described — Businesslike Methods of Starting Co-operative 
 Enterprises — Importance of Careful Auditing and Inspection 
 of Books — The Government and the Farmer — Seven Factors 
 Which Explain the Wonderful Record of Danish Co-opera- 
 tion 
 
 HOW many kinds of co-operative societies there are 
 in Denmark I have no idea. The latest govern- 
 ment "Aarbog" ("Yearbook") lists co-operative 
 creameries, co-operative egg-packing societies, co- 
 operative stores, co-operative slaughterhouses, co-operative fer- 
 tilizer associations, co-operative sugar factories, societies for 
 co-operative accident insurance, the Co-operative Association for 
 Buying Agricultural Machinery, the Co-operative Association 
 for Creamery Accident Insurance, and enough more to leave 
 one gasping for breath. Mr. Monrad told me that in Naerum 
 they have a co-operative bakery, where the bread for all the 
 members is baked in enormous ovens. 
 
 Nearly all of these societies are of hardy outdoor growth 
 — not an exotic growth forced into an unnatural development 
 through artificial stimulus. The farmers of Denmark have not 
 sat idle waiting for the government to do something for them. 
 Mr. Roosevelt once said that our attitude with regard to the 
 negro ought to be, "Help him if he stumbles, but if he lies down, 
 let him stay," and this excellent policy has been steadfastly ob- 
 served by the Danish government in its relation to agricul- 
 tural organizations. It has stood ready to help, but not to 
 
 213
 
 214 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 coddle, ready to supplement the farmer's own contribution, 
 but not to supplant it. 
 
 Only in the case of the societies for the improvement of 
 stock and the purchase of breeding animals have there been 
 any notable government appropriations. The "control so- 
 cieties" or cow-testing associations of which there are 530 
 local organizations, get $32,400 from the government, and the 
 money is certainly well expended. I have already explained 
 the plan in brief; once every eighteen or twenty days the 
 representative of the society (who is, of course, a thor- 
 oughly trained, technically educated dairyman — or some- 
 times a woman) visits each farmer, ascertains each cow's 
 milk yield and the percentage of butter fat, and advises the 
 farmer with regard to her feed and all matters of common 
 interest. The farmers pay about 2"] to 54 cents a cow an- 
 nually for the service, and the government supplements the 
 amount from the $32,400 appropriation I have just men- 
 tioned. 
 
 In somewhat the same fashion traveling agricultural in- 
 structors, corresponding somewhat to our demonstration 
 agents, are employed through the agency of the society, 
 the government paying half their salaries and the farmers 
 one-half. The National Danish Creamery Association also 
 gets a subsidy of about $1,000 a year, one feature of its work 
 being the encouragement of "Pail Shows" or Butter Shows. 
 About every two or three months each local association, 
 comprising say ten, twenty, or thirty creameries, will have 
 an exhibit, samples of butter from each creamery being 
 tested and scored. 
 
 There is also, through some organization, general over- 
 sight into the quality of output of each creamery. The 
 "surprise" element of this inquiry is its effectual and dis- 
 tinguishing feature. Without warning, a creamery will 
 get a telegram requiring it to express a sample of that day's 
 product to Copenhagen. In cheese making it is, of course, 
 not practicable to act so quickly, but a mold is sent by mail 
 with the requirement that it shall be returned next day.
 
 SEVEN SECRETS OF SUCCESS WITH DANISH CO-OPERATION 215 
 
 and the cheese bearing its imprint forwarded later. No 
 creamery can afford to turn out anything but clean and 
 wholesome butter and cheese, for the manager never knows 
 when, by this or other surprise methods, the searchlight of 
 official scrutiny will be turned full upon his establishment. 
 It is to the interest of every dairy to require every other 
 dairy to produce a high quality product, for all Danish ex- 
 port butter bears the government trade-mark, all alike profit 
 by its reputation, and the good name it has gained is indeed 
 rather to be chosen than great riches. 
 
 The horse breeding, cattle breeding and pig breeding as- 
 sociations have perhaps had a more rapid growth these last 
 five years than any other sort of co-operative organization, 
 and to them the government has been especially liberal. 
 The general plan is that if a sufficient group of farmers join 
 together to purchase a prize-winning animal, approved as 
 worthy by expert judges, the government will itself pay a 
 part of the purchase price. I have already recorded the 
 almost marvelously helpful results attending such a policy 
 in Ireland ; and the rapid growth of these organizations and 
 of the government subsidies granted them, indicates that 
 equal satisfaction must have been achieved among the 
 Danish people. The government appropriation for horse 
 breeding societies has been increased in twelve years from 
 $13,500 to $43,500, and for cattle breeding societies from 
 $18,900 to $54,800. 
 
 The farmers' co-operative purchasing societies in Denmark 
 have had a very stormy but triumphant history. Originally, 
 they seem to have aimed only at buying feeds and fer- 
 tilizers for their members, but they have now greatly ex- 
 tended their operations and deal in a variety of supplies. 
 They had to fight from the day of their birth, and it was for 
 a long time uncertain whether they would survive. In 
 Ireland, when the co-operative societies for buying seeds 
 and fertilizers were started, the "gombeen-men" or time 
 merchants were so furious that in some cases they brought 
 false charges against the promoters and had them arrested.
 
 216 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 And Danish co-operators, in their early days, had almost 
 as bitter a struggle. The merchants combined against them, 
 and by pressure brought the wholesalers and manufacturers 
 into league with themselves against the co-operating farm- 
 ers. That is to say, the merchants said to the wholesalers 
 and manufacturers, "We will not buy from you if you sell 
 direct to the farmers," and in consequence the co-operative 
 societies found themselves unable to purchase the sup- 
 plies they wanted, either from wholesalers or manufacturers. 
 
 But the embattled Danish farmers were not to be con- 
 quered so easily. "Very well," they said to the manufac- 
 turers, "decide for yourselves. If you will not sell to us, 
 we will build factories of our own." And that is what they 
 straightway proceeded to do in a number of instances. The 
 dairymen have a co-operative factory for making their own 
 churns and butter tubs, and there are a number of other 
 co-operative factories — rope factories, woolen factories, fer- 
 tilizer factories, coffee and rice mills, etc., etc. Just now a 
 cement factory is in prospect. 
 
 But the wise Danes do not rush blindly Into any new en- 
 terprise of this kind. They are strictly businesslike in their 
 efforts. Not a brick will be laid for the cement factory, not 
 a cent of risk taken by the farmers, until the guaranteed 
 orders from the co-operative stores are sufficient to insure 
 its success. 
 
 The seed business of these co-operative societies is 
 naturally immense, and I was interested in visiting the 
 chief seed farm located at Lyngby hard by the agricultural 
 college there. The Danish Co-operative Wholesale Society 
 sells one-seventh of all the farm seeds sold in the kingdom, 
 I was told — $12,000,000 worth — and an interesting feature 
 is that all the profits are put aside as an insurance fund to 
 repay any members who may have by any means received 
 bad seed. At Lyngby, however, there are test plots, from 
 which samples of the seed furnished by all leading growers 
 are tested, and a farmer's complaint will need corroborative 
 testimony unless the society's own tests indicate that the
 
 SEVEN SECRETS OF SUCCESS WITH DANISH CO-OPERATION 217 
 
 seeds were inferior. It is said that one result of the co- 
 operative seed business has been to greatly improve the 
 quality and cheapen the price of all kinds of farm and gar- 
 den seeds. 
 
 A sugar factory is the newest co-operative enterprise now 
 assured. There have been six or seven sugar factories in 
 Denmark, all apparently in a trust, and making about 25 
 per cent dividends, according to common report. So a co- 
 operative sugar factory w^as planned, product from a suf- 
 ficient area guaranteed by the farmer members to insure a 
 full supply of beets, and the sanguine incorporators went to 
 the Copenhagen banks to borrow the needed capital. It 
 was here that they ran against that vague and nebulous, 
 and yet powerful influence we Americans have denominated 
 "the money trust." The directors in the great banks were 
 also, some of them, directors in the sugar trust. They 
 didn't want a rival factory started, so they refused to lend 
 the money. It happened, however, that one of the leading 
 farmers was cousin to a rich German capitalist, and he 
 furnished the required capital. 
 
 The co-operative credit societies in Denmark differ rather 
 notably from those in most other European countries. 
 Credit unions exist, these not lending money directly, but 
 furnishing the borrower credit union bonds, which he can 
 sell in the open market for whatever he can realize on them. 
 
 For example, suppose a Dane has a farm and a residence. 
 From a popular type of credit union he can borrow three- 
 fifths the value of the house, or one-half the value of the 
 land, up to a maximum limit of $1,286. Suppose he should 
 be entiled to borrow $1,000. Then the credit union, upon 
 taking his mortgage, instead of paying him $1,000 in cash, 
 turns over to him its 4 per cent state-guaranteed bond for 
 $1,000. He sells this for whatever he can get for it — some- 
 thing less than par, depending upon the state of the money 
 market. Then he pays 2 per cent to a reserve fund ; and 
 after that he pays 4 per cent interest a year and i per cent 
 extra as discount or sinking fund, and this total of 5 per
 
 218 HOW FARMERS CO-OPER^VTE AND DOUBLE PROFITS 
 
 cent a year — $50 on the $1,000 — paid each year for 45 years, 
 extinguishes the loan. Of course, if he wishes to pay off 
 earlier, he can do so. In this case, suppose the $1,000 in 
 bonds should sell at 95, then the borrower would get $950 
 in all. But he would be bound to the bank for a full $1,000, 
 which would mean in effect simply that he paid a premium 
 of $50 to get $1,000 on such favorable terms. 
 
 The members of these credit unions borrow on their joint, 
 several and unlimited liability ; but it is said there have been 
 no losses for 50 years, and the 2 per cent reser\'e fund would 
 certainly seem ample insurance against any trouble of this kind. 
 
 In most ways, as the reader has probably come to believe, 
 the Danish co-operative societies have been very business- 
 like, but in one respect they have been unaccountably re- 
 miss. In many cases they have neglected to employ skilled 
 or professional auditors to examine their books, and ap- 
 parently have neglected to obtain adequate bonds from 
 some high officials. "We are a sort of trusting, confiding 
 people," Mr. Monrad said to me. "I suppose that is the 
 reason Dr. Cook chose Copenhagen as the place from which 
 to announce that he had discovered the North Pole !" At 
 any rate, the importance of requiring absolutely thorough- . 
 going inspection has now been impressed upon the Danish j 
 co-operators in such a manner that they are not likely to 
 forget it again. A "high financier" lawyer and an all-round 
 "jolly good fellow" got into the good graces of the farmers, 
 got himself appointed to some responsible position where 
 he handled a lot of the farmers' money; and soon began 
 speculating. When the auditing board would come around, 
 he would wine and dine them, wind up with an invitation. 
 "Now, let's look over the books and see how much I have 
 been stealing," and the members, not being professional 
 bookkeepers, nor as strict as they should have been, would 
 go away and report everything all right, this being the 
 regular program, until one day the crash came, and it was 
 discovered that the daring plunger had robbed the credulous 
 co-operators of several fortunes. Now the Danish farmers
 
 SEVEN SECRETS OF SUCCESS WITH DANISH CO-OPERATION 219 
 
 are beginning to employ professional auditors for the ex- 
 amination of their accounts, just as the Irish farmers do, 
 and as the German co-operative societies are required to 
 do by law. 
 
 A sort of summary may now not inappropriately conclude 
 our story of Danish agricultural co-operation : 
 
 I. There is no doubt about it that the success of Danish 
 co-operation is mainly due to the fact that such a great pro- 
 portion of the Danish farmers own their own homes and 
 land — the division of the land into small holdings. Just 
 how small they are will be indicated by the following table : 
 
 Size of farms 
 
 No. of farms 
 
 Total No. of 
 acres in class 
 
 Less than IV2 acres - 
 
 68,000 
 65,000 
 46,000 
 61,000 
 8.000 
 822 
 
 25 000 
 
 From VA to 13'/4 acres _ 
 
 450 000 
 
 From 13^ to 40 acres 
 
 1 150 000 
 
 From 40 to 150 acres. 
 
 5,900,000 
 2 100 000 
 
 From 150 to 650 acres 
 
 More than 650 acres 
 
 1,150,000 
 
 
 The fact that there is such a great proportion of these 
 small farmers is chiefly attributable to the liberal terms on 
 which the government advances money to laborers wishing 
 to buy small tracts — lending nine-tenths of the money re- 
 payable at a low rate of interest after a long period of years. 
 The government also endeavors to keep down the size of 
 the farms; under certain circumstances it appears that a 
 man is not allowed to buy an adjoining farm and unite it with 
 his own, though I could not get exact particulars on this point. 
 
 2. No matter what the system of land tenure, however, 
 the farmers would never have succeeded but for the high 
 degree of general intelligence due to education, and — in 
 hardly less measure — to the unique system of "people's high 
 schools" with their five-months' winter courses for young 
 men and three-months' summer courses for girls.
 
 220 HOW FARMERS CO-OPERATE AND DOUBLE PROFITS 
 
 3. Despite the generally favorable circumstances, co-op- 
 eration would still have succeeded only partially if all enter- 
 prises had not been based upon compulsory, binding, iron- 
 clad agreements. Mere good intentions form no safe basis 
 for a business enterprise. 
 
 4. The local societies have been federated into larger 
 groups, and these larger groups into national organizations, 
 with ample power for enforcing high standards of quality, 
 and of commercial integrity. "For the honor of Denmark 
 for the honor of Danish farmers, for the honor of the cause 
 of co-operation," there has been everlasting insistence upon 
 quality, cleanliness, square dealing; absolute reliability in 
 every particular. 
 
 5. The business training, the self-confidence, the spirit 
 of fellowship, developed (i) by education and (2) by co- 
 operation, have made the farmers the political rulers of the 
 kingdom. Just as in America, it is regarded as the natural 
 and proper thing to send a lawyer to the Legislature or to 
 .Congress, so in Denmark it is regarded as the natural and 
 proper thing to send a farmer. 
 
 6. The farmers, however, have had little nursing or cod- 
 dling, and no lavish appropriations. "Help those who help 
 themselves," has been the motto, and as a rule money has 
 been voted only to such purposes as the farmers themselves 
 would subscribe liberally to further, instead of spent whole- 
 sale on such schemes as our congressional "free seed" dis- 
 tribution in America. 
 
 7. By reason of the threefold activities of the farmers, 
 (a) as growers of raw material, (b) as manufacturers of this 
 raw material into butter, bacon and eggs, and (c) as sellers 
 of their products, they make three profits where the Amer- 
 ican farmer makes one, besides making their land richei* 
 all the time, so that everywhere crops are bigger than they 
 were 60 years ago. Under these conditions a man finds 
 "ten acres enough," and the ideal of "a little land full of 
 happy people" is not a dream but a reality — thanks to Home 
 Ownership, Education and Co-operation.
 
 APPENDIX 
 
 WHAT SORT OF BY-LAWS SHALL WE HAVE? ! 
 
 I 
 REGULATIONS FOR A CO-OPERATIVE STORE. \ 
 
 BY-LAWS FOR A FARMERS' CLUB. i 
 
 i. 
 
 PARLIAMENTARY RULES. I 
 
 S2t
 
 APPENDIX 
 WHAT SORT OF BY-LAWS SHALL WE HAVE? 
 
 In every farmers' organization one of the puzzling prob- 
 lems the members first encounter, as we have already in- 
 timated in Chapter VII, is as to what they should have in 
 their constitution and by-laws, or articles of incorporation 
 and by-laws, as the case may be. 
 
 Let us begin with the constitution, or if an incorporated 
 company, with the articles of incorporation. These should 
 give the name of the organization, place of business, amount 
 of capital stock and size of shares, what officers are to be 
 chosen and their duties, and date of annual meeting. The 
 following constitution of the Excelsior (Minn.) Fruit 
 Growers' Association is a good type of constitution, and 
 with a little extension would serve as articles of incor- 
 poration : 
 
 Constitution of the Excelsior (Minn.) Fruit Growers' Association 
 
 ARTICLE I 
 
 The name of this corporation shall be the Excelsior Fruit Growers' 
 Association, and its place of business shall be Excelsior, Hennepin 
 County, State of Minnesota. 
 
 ARTICLE II 
 
 The business of the Association shall be to buy, sell and deal in 
 fruits of all kinds grown in this vicinity and to do all things necessary 
 to be done in conducting a general fruit business. 
 
 ARTICLE III 
 
 The officers of this Association shall be a president, secretary, treas- 
 urer and a board of three directors, who shall hold their office for the 
 term of one year, or until their successors are elected and qualified. 
 The president and secretary shall be ex-officio members of the board 
 of directors. 
 
 2?3
 
 224 APPENDIX 
 
 ARTICLE IV 
 
 The annual meeting of this Association shall be held on the first 
 Monday in April of each year. 
 
 ARTICLE V 
 
 The names of the first officers of this Association are as follows : 
 G. W. Shuman, President ; E. G. E. Reel, Secretary ; C. W. Spickerman, 
 Treasurer; H. H. Whitmore, P. M. Endsley and R. A. Wright, 
 Directors. 
 
 ARTICLE VI 
 The president and secretary of this Association are hereby author- 
 ized to execute and acknowledge all papers, contracts and deeds neces- 
 sary to be executed and acknowledged by said Association, but they 
 shall not execute and acknowledge papers of any kind except by the 
 consent and direction of the board of directors of said Association. 
 
 Now as to the by-laws. We are presenting herewith a 
 model which combines features of the model recommended 
 by the Wisconsin Board of Public Affairs with some fea- 
 tures of the by-laws of the Catawba Co-operative Creamery. 
 These sections may be amended to meet the wishes of any 
 group of prospective co-operators. 
 
 Form of By-Laws Based on Wisconsin and North Carolina Experience 
 
 ARTICLE I 
 Membership 
 
 Section 1. The membership of the Association shall be confined, as 
 far as possible, to actual farmers. Not more than 40 per cent of the 
 stock shall be sold to those whose main interest is other than farming. 
 
 Sec. 2. The Association reserves the right of buying in any share of 
 stock which is for sale, and of passing on the acceptability of any 
 applicant for membership. 
 
 Sec. 3. All shares must, before issue, be registered on the books of 
 tl . Association, and the purchaser by the acceptance thereof agrees to 
 all the by-laws and rules of the Association, including also all amend- 
 ments that may be legally adopted, and thereby shall become a mem- 
 ber of the company. No shares can be transferred until all claims 
 of this company against the owner of such shares have been paid. 
 
 Sec 4. If any member of the Association desires to dispose of his 
 share or shares, he shall first offer to sell same to the company at mar- 
 ket value; if company declines to purchase, the purchaser may find a 
 purchaser acceptable to the company and have same transferred to said
 
 I APPENDIX 225 
 
 purchaser on the books of the company in accordance with the 
 rules. If a member removes from the territory and ceases to be a 
 patron of the Association and estabHshes a residence elsewhere, the 
 board of directors shall purchase the share or shares owned by the said 
 non-resident member. Sections three (3) and four (4) of this article 
 shall be printed on each and every certificate of stock issued by the 
 company. 
 
 Sec. 5. Each member shall be entitled to one vote only. 
 
 Sec. 6. No member shall be entitled to own more than 10 per cent 
 of the capital stock. 
 
 ARTICLE II 
 
 Board of Directors 
 
 Section 1. The board of directors shall consist of five members. 
 
 Sec. 2. They shall be selected by and from among the stockholders 
 at the annual meeting, and shall serve until their successors are duly 
 elected and qualified. Of the directors elected upon the completion of 
 the organization two shall serve one year, two two years, and one three 
 5rears. The regular term of office of the directors shall be three years. 
 If vacancies occur in the board the same shall be filled by the remain- 
 ing directors until the next annual election. Immediately after the 
 election of the directors, the newly elected board of directors shall meet 
 for organization and the election of officers. 
 
 Sec. 3. The board of directors shall have the management and con- 
 trol of the business of the corporation and shall employ such agents as 
 they may deem advisable and fix the rate of compensation of all officers 
 and employees. 
 
 Sec. 4. The board of directors shall decide what bonds shall be re- 
 quired of officers and shall audit the accounts of the Association at least 
 once every quarter. 
 
 Sec. 5. The board of directors shall meet on the first of each month 
 and be subject to a call for special meetings at such times as the presi- 
 dent or secretary shall deem necessary. 
 
 Sec. 6. A majority of the directors shall constitute a quorum of the 
 board. 
 
 Sec. 7. No member of the board of directors shall be allowed to 
 vote on any question in which he may have any personal interest con- 
 flicting with the interests of the Association as a whole. 
 
 ARTICLE III 
 
 Officers 
 Section 1. The officers of the corporation shall consist of president, 
 vice-president, secretary and treasurer. The office of secretary' and 
 treasurer may be held by the same person. The officers shall be elected 
 by the board of directors by a majority vote of the whole number of 
 directors. The first elections shall be held immediately after the elec- 
 tion of the board. Subsequent elections shall be held annually, on the 
 day of the first regular meeting of the board after their election, the 
 day to be fixed by resolution of the board of directors.
 
 226 APPENDIX 
 
 Sec. 2. In case of death, resignation or removal of any officer, the 
 board shall elect his successor, who shall hold office for the unexpired 
 term. 
 
 Sec. 3. The president shall preside at all meetings of the Associa- 
 tion. He shall have power to call special meetings of the Association 
 whenever, in his judgment, the business of the Association shall require 
 it. He shall also, upon a written request of 10 per cent of the stock- 
 holders or three members of the board of directors, call a special meet- 
 ing of either the stockholders or directors as may be requested. 
 
 Sec. 4. The vice-president shall perform the duties of the president 
 when the latter is absent or unable to perform the duties of his office. 
 
 Sec. 5. The secretary shall keep a record of the proceedings of all 
 meetings held by the stockholders of the company, and also of all meet- 
 ings of the board of directors. The secretary shall keep the accounts 
 of the company and use such system therefor as is adopted by the board 
 of directors. He shall file all receipts, cashed checks and records, and 
 write all checks issued by the company. The secretary, by authority 
 of the president, shall sign all checks issued by *he company, and with 
 the president sign all notes. The secretary shall present to the board 
 of directors at their monthly meeting a statement of the business of 
 the company for the previous month. He shall also attend the annual 
 meeting, present to the stockholders a complete record of the previous 
 year's business, giving an itemized statement of the total expenditures and 
 income for the year and a detailed report of the resources and liabili- 
 ties of the company. For performing such duties, the secretary's com- 
 pensation shall be fixed by the board of directors. 
 
 Sec. 6. It shall be the duty of the treasurer to take care of the 
 funds of the company. He shall make a monthly report to the board 
 of directors, and an annual report to the stockholders of the company. 
 
 ARTICLE IV 
 
 Capital Stock; Stockholders' Meetings 
 
 Section 1. The capital stock of this Association shall be 
 
 dollars, which shall be divided into 
 
 hundred shares of dollars each, which shall be 
 
 paid in as follows (or at such times and in 
 
 such amounts as the board of directors may determine), and may be 
 paid either in cash, property, labor or securities, as the board of direc- 
 tors may determine. 
 
 Sec. 2. The stockholders shall meet on the 
 
 of the month of of each year, and at such other 
 
 times as is provided in Article III, Section 3. 
 
 Sec. 3. Thirty per cent of the stockholders in number shall consti- 
 tute a quorum for the transaction of business at any regular or special 
 meeting of the stockholders. 
 
 ARTICLE V 
 Apportionment of Earnings 
 Section 1. The directors, subject to revisions by the Association, at
 
 APPENDIX 227 
 
 any general or special meeting, shall apportion the earnings by first 
 paying dividends on the paid-up capital stock, not exceeding 6 (or 8) 
 per cent per annum. Then they should set aside not less than 10 per 
 cent of the net profits for a reserve fund until an amount has accumu- 
 lated in said reserve fund equal to 30 per cent of the paid-up capital 
 stock. Then the remainder of said net profits should be distributed by 
 uniform dividend upon the amount of purchases made by shareholders, 
 and one-half of such uniform dividend should be paid non-shareholders 
 on the amount of their purchases. 
 
 (Note. — This half -rate dividend may be credited to the account of 
 such non-shareholders on account of capital stock of the Association. 
 In selling agencies, such as fruit, truck, peanut and cotton growers' 
 associations, and in productive associations such as creameries, can- 
 neries, warehouses, factories and the like, dividends should be pro- 
 rated according to the raw material delivered instead of on goods pur- 
 chased. In case the Association is both a selling and a productive 
 concern, the dividends may be on both raw material delivered and on 
 goods purchased by patrons.) 
 
 ARTICLE VI 
 
 Sale of Products 
 Section 1. This organization shall have the exclusive and un- 
 qualified power to market those products of its members which the 
 Association was formed to sell ; provided, if a competitor raises the 
 price of farm products above that which the Association gives, any 
 stockholder may have the right to sell his products through an outside 
 agency, provided he pays his proper proportion of the running ex- 
 penses to the Association, as required by rules fixed by the stockholders 
 or directors. This sum should not exceed 5 per cent of the value of 
 products so sold to a competing concern. 
 
 ARTICLE VII 
 
 Amendments to By-Laws 
 
 Section 1. These by-laws may be altered or amended by a two- 
 thirds vote of the members present at any regular annual meeting or 
 any special meeting called for that purpose. In the latter case, ten 
 days' notice thereof shall have been given to all the members previous 
 to the time of voting thereon. 
 
 Sec. 2. Whenever, in the opinion of the board of directors, a change 
 in the rules and regulations is necessary, they shall have power to in- 
 itiate such change and refer it to the shareholders for final action. 
 
 ARTICLE VIII 
 
 Order of Business 
 
 1. Call to order. 
 
 2. Roll-call of officers. 
 
 3. Reading minutes of last meeting. 
 
 4. Reports of officers.
 
 228 APPENDIX 
 
 5. Reports of committees. 
 
 6. Report of education committee. 
 
 7. Reports of managers. 
 
 8. Communications and bills. 
 
 9. Grievances and complaints. 
 
 10. Consideration of reports. 
 
 11. Election of officers. 
 
 12. Filling vacancies. 
 
 13. Appointing committees. 
 
 14. Unfinished business. 
 
 15. New business. 
 
 16. Good of the company. 
 
 17. Sign minutes. 
 
 18. Adjournment 
 
 We are also glad to give herewith another form of by- 
 laws which, out of a large number considered by him, has 
 won the especial commendation of so good an authority as 
 Dr. John Lee Coulter (see Chapter VII). It will be well 
 for a group of co-operators to examine both forms here 
 presented, picking the best ideas from each, and then amend 
 in any particular to suit local conditions. The model form 
 selected by Dr. Coulter is that of the Lakefield (Minn.) 
 Farmers' Co-operative Elevator Company, and reads as 
 follows : 
 
 Constitution and By-Laws 
 
 ARTICLE I 
 
 Section 1. The officers of this corporation shall consist of a presi- 
 dent, vice-president, secretary and treasurer, who shall be elected by 
 the directors and who shall perform the duties usually appertaining to 
 their respective offices. Said officers shall hold office for one year, and 
 until their successors are elected and q alified. 
 
 Sec. 2. No person shall be eligible to the office of president, vice- 
 president or treasurer who is not a director; and no person shall be 
 eligible to the office of director who is not a stockholder. A president, 
 vice-president, treasurer, secretary or director who ceases at any tirne 
 to be a stockholder shall at the same time cease to hold any office in 
 this corporation. 
 
 Sec. 3. The board of directors may by resolution require any and 
 all of the general officers and agents of this corporation to give a bond 
 to the corporation with sufficient securities conditioned for the faithful 
 performance of the duties of their respective offices and such other con-
 
 APPENDIX 229 
 
 ditions as may from time to time be required by the board of directors. 
 Sec. 4. All written contracts entered into in behalf of this cor- 
 poration shall be signed by the president and secretary, and the cor- 
 porate seal shall be attached thereto. 
 
 ARTICLE II 
 Directors and Their Duties 
 
 Section 1. The affairs of this corporation shall be managed by a 
 board of nine directors, who shall be elected by the stockholders at the 
 regular annual meeting, and who shall hold office for one year and until 
 their successors are elected. 
 
 Sec. 2. The directors shall elect all the officers of the corporation 
 and appoint all its agents. Vacancies in the board of directors may be 
 filled by the remaining members of the board at any regular or special 
 meeting of the board. 
 
 Sec. 3. The regular meeting of the board of directors shall be held 
 immediately after the adjournment of each regular annual meeting of 
 the stockholders, and also upon call of the president or secretary upon 
 one (1) day's notice, either orally or in writing. Such meeting shall be 
 held at the general office of the corporation. 
 
 Sec. 4. Special meetings of the board of directors may be called at 
 any time by the president or secretary by giving to each director a 
 written or oral notice, either orally or in writing, at least one day 
 before the time of such meeting. 
 
 Sec. 5. At all regular or special meetings of the board of directors 
 a majority of the board shall constitute a quorum for the transaction 
 of business, but a smaller number may adjourn the meeting to another 
 day or hour. 
 
 Sec. 6. At each regular annual meeting of the stockholders, the 
 board of directors shall present a general statement or report of the 
 business of the preceding year, and of the financial condition of the 
 corporation. 
 
 ARTICLE III 
 Regulations Concerning Stock 
 
 Section 1. The capital stock of this corporation shall be divided 
 into 1,000 shares of the value of fifty ($50) dollars each. 
 
 Sec. 2. All certificates shall be signed by the president and secre- 
 tary and the corporate seal shall be attached thereto. 
 
 Sec. 3. Shares of the capital stock shall be transferred by indorse- 
 ment of the certificate, and its surrender to the secretary for cancella- 
 tion, and such transfer approved by the board of directors, whereupon 
 a new certificate shall be issued to the transferee. The board of direc- 
 tors may by resolution forbid the transfer of stock for a space of time 
 not exceeding thirty (30) days immediately before the meeting of the 
 stockholders or immediately before the time a dividend is payable. 
 Provided, that in no event shall any stock be transferred until any and
 
 230 APPENDIX 
 
 all indebtedness owing by such stockholder to this corporation shall 
 have been paid. 
 
 Sec. 4. No stock shall be issued to any other person than a prac- 
 tical farmer, said practical farmer shall be defined as one who makes 
 his living by farming, or one who has ceased farming and is not en- 
 gaged in any other business that will conflict in any way with the busi- 
 ness carried on by this corporation. No person can own more than 
 three (.3) shares of capital stock. 
 
 Sec. 5. There shall be no assessment levied at any time unless at a 
 regular or special meeting of the stockholders, and no assessment can 
 be levied at any regular or special meeting of stockholders unless each 
 stockholder has been duly notified by a written notice thereof ten (10) 
 days prior to such regular or special meeting at which time an assess- 
 ment shall be levied. 
 
 Sec. 6. Any stockholder who shall fail to pay any assessment levied 
 on his stock for thirty (30) days after the same shall be due shall 
 be served by a written or printed notice by the secretary, personally, 
 or by registered letter through the United States mail. Such notice 
 shall state the amount due from such stockholder, and shall notify him 
 that unless he pays the same within thirty (30) days after the service 
 of such notice his stock shall be forfeited. 
 
 If the delinquent stockholder fails to pay the entire amount due from 
 him within the time specified in such notice, his stock shall become for- 
 feited without further notice on the part of the corporation, and such 
 forfeited stock may thereupon, without further notice, be sold by the 
 secretary for the benefit of the corporation, at either public or private 
 sale, provided, that the proceeds of such sale, if any over and above the 
 amount due on said stock, shall be paid on demand to the delinquent 
 stockholder. 
 
 ARTICLE IV 
 Stockholders' Meetings 
 
 Section 1. The regular annual meeting of the stockholders of this 
 corporation shall be held in the general office of this corporation in 
 Lakefield, Minn., on the last Saturday of June in each year at the hour 
 of 10 o'clock a. m. Special meetings of the stockholders may be called 
 by the board of directors. 
 
 Sec. 2. The secretary shall mail to each stockholder at his known 
 place of residence a written or printed notice of the time and the place 
 of holding every annual and special stockholders' meeting. Such 
 notice shall be mailed at least ten (10) days before the time at which 
 the meeting is to be held. 
 
 Sec. 3. At all meetings of the stockholders, each stockholder shall 
 be entitled to cast one vote for each share of stock owned by him 
 regardless of the number of shares of stock owned. He may vote in 
 person or by proxy, but such proxy shall be a stockholder, the appoint- 
 ment being made in writing and duly filed with the secretary and by 
 him entered upon the records of the proceedings of the meeting. 
 
 Sec. 4. At any stockholders' meeting a majority of the stock must
 
 APPENDIX 231 
 
 be represented in order to constitute a quorum for the transaction of 
 business, but the stockholders present at any meeting, although less 
 than a quorum, may adjourn the meeting to some other day or hour. 
 Sec. 5. The president and secretary of the corporation shall act as 
 president and secretary of each stockholders' meeting unless the meet- 
 ing shall otherwise decide. Any stockholders' meeting may at any time 
 elect a president and secretary of the meeting and thereupon the presi- 
 dent and secretary of the corporation shall no longer act as president 
 and secretary of said meeting. 
 
 ARTICLE V 
 Amendments 
 Section 1. These by-laws, or any of them, naay be altered, amended, 
 added to or repealed at any meeting of the board of directors. 
 
 ARTICLE VI 
 Assessments and Penalties 
 
 Section 1. Assessments for the payment of agents* or employees* 
 salaries, or other expenses connected with the business of this cor- 
 poration, or for the purpose of increasing available funds on hand, or 
 to cover any deficit in the treasury of the corporation, shall be made 
 upon the several stockholders in proportion and pro rata upon the 
 stock held or owned by each stockholder. 
 
 Sec. 2. Any stockholder who shall at any time while a member of 
 this corporation, sell or dispose of to any dealer or elevator company 
 other than this corporation, any grain or seeds of any kind, or who shall 
 deliver to the other dealers or elevator companies for shipment to 
 terminal markets, any grain or seeds of any, kind, shall pay to his 
 corporation an assessment and penalty of one cent per bushel for each 
 and every bushel of grain so sold or disposed of to other dealers or 
 elevator companies, or shipped through other dealers or elevator com- 
 panies, which sum shall become due and payable forthwith, when the 
 buyer or secretary or directors of this corporation shall receive notice 
 or be apprised of the amount of grain or seeds so shipped or disposed 
 of through other dealers. And in case of the refusal or failure to pay 
 said sum then due for such sale or shipment as aforesaid, to this 
 corporation upon demand, by the buyer or agent of this corporation to 
 the secretary, then, in such case, the secretary of this corporation is 
 hereby authorized and fully empowered to levy an assessment and pen- 
 alty against such delinquent stockholder, said levy to be made under 
 the direction of the board of directors at any general or special meet- 
 ing of the board ; said levy and assessments to be made on the basis 
 of two cents per bushel for all grain or seeds so sold, disposed of or 
 shipped to or through other dealers or elevator companies and said 
 assessment and penalty shall be enforced against such delinquent 
 stockholder, and the collection of the same shall be made in a manner 
 provided for the collection of assessment and penalties under Section 
 six (6) of Article three (3) of these by-laws, and said deHnquent
 
 22)2 APPENDIX 
 
 Stockholder's stock shall be sold and disposed of for the purpose of 
 enforcing the collection of such assessment as therein provided in said 
 Section six (6) of Article three (3). 
 
 Amendments Adopted 
 
 Amendment to Article one (l), Section three (3) of the by-laws 
 was adopted December 16, 1905. 
 
 The president, vice-president, secretary, treasurer and manager shall 
 each give a bond to the corporation with sufficient securities conditioned 
 for the faithful performance of the duties of their respective positions 
 and such other duties as may from time to time be imposed upon them 
 by the board of directors. The minimum amount of such bond shall be 
 as follows : President, $1,000 ; vice-president, $1,000 ; secretary, $1,000 ; 
 treasurer, $2,000; manager, $2,000. The board of directors may by 
 resolution require from said officers, or any of them, a bond in such 
 additional amounts as the board of directors may from time to time 
 deem necessary. 
 
 By-Law Added July lo, igog 
 
 In case of the removal of a stockholder from the trading territory 
 of this corporation, the board of directors are hereby authorized to 
 return to such stockholder all moneys and property received by such 
 corporation for such share or shares of stock held by such stock- 
 holder, upon proper surrender by such stockholder of such share or 
 shares of stock; provided, however, that this provision shall be sub- 
 ject to the general laws of the state governing corporations. 
 
 At the end of each fiscal year, the board of directors shall distribute 
 the net profits, after all operating and other expenses are paid, as fol- 
 lows, and in the order following : 
 
 1. A dividend equal to the current rate of interest, but not to exceed 
 8 per cent, shall be paid upon the capital stock of the corporation if 
 there are sufficient profits for this purpose, otherwise pro rata. 
 
 2. Out of the balance of such net profits, if any there be, an amount, 
 not less than 5 per cent of such profits, shall be set over to the reserve 
 fund, until such reserve fund shall equal the amount required by law; 
 thereafter, such amount annually as the board of directors shall de- 
 termine. 
 
 3. The balance of the net profits, if any, shall be distributed to the 
 patrons of the corporation as follows : 
 
 To stockholding patrons, upon the sales to and purchases from the 
 corporation, in proportion to the said sales and purchases for the pre- 
 ceding year. . r . ,r 
 
 To non-stockholding patrons of the corporation at a rate of one-halt 
 that applied to stockholding patrons, and only upon the amount of pur- 
 chases from the corporation, in proportion to the amount of such pur- 
 chases for the preceding year.
 
 REGULATIONS FOR A CO-OPERATIVE STORE 
 
 The Willmar (Minn.) Co-operative Mercantile Company, 
 mentioned in our chapter on the Svea community, also has 
 some interesting regulations. One of them reads as fol- 
 lows: 
 
 "Section 2. The absence of a director, officer or committeeman 
 from three successive regular meetings shall be deemed a resignation, 
 unless such absence is decided unavoidable by a concurrence of a ma- 
 jority of such body. The acceptance by any director of the manager- 
 ship or any other position in the company shall constitute a resigna- 
 tion of such director. The board of directors shall proceed to fill such 
 vacancy until next regular meeting of the company." 
 
 The following sections on "Manner of Conducting Busi- 
 ness" are also instructive : 
 
 Section 1. Produce or labor will be taken In exchange for goods, 
 at net cash value and will be considered cash. 
 
 Sec. 2. Goods shall be sold at ordinary market price. 
 
 Sec. 3. A record shall be kept of all the purchases of members and 
 resident non-members, and every non-member patron shall be paid one- 
 half as much percentage of purchase dividend as members. 
 
 Sec. 4. Dividends on purchases will be paid only on duplicate sales 
 slips returned each month on or before January first of the current 
 year, and in compliance with the following conditions : 
 
 (a) The name of the member, the date of purchase and the sales- 
 man's initials or number must be written by the clerk on the sales slip 
 at time of purchase. 
 
 (b) Each member shall arrange his sales slips in chronological 
 order, and shall on a separate sheet write in ink the amount of each 
 slip in said order in columns and shall add the same. 
 
 (c) He shall then tie the sales slips and the statement sheet together 
 in a compact form, and on the outside write his name in ink and the 
 total amount of purchases on which he is entitled to draw dividends. 
 
 (d) No dividend will be paid on slips marked NET, and all goods 
 sold for less than 5 per cent gross profit shall be so marked, nor on 
 slips dated more than six months prior to the closing fiscal dividend 
 period. 
 
 Sec. 5. The company may permit deserving persons to subscribe 
 for shares, and to pay for same on the installment plan, but such per- 
 sons must sign notes specifying times of payment. AH dividends to be 
 
 233
 
 '234 APPENDIX 
 
 credited on said notes, toward the payment of the stock subscribed for, 
 until the member has fully paid said notes, and all other indebtedness 
 to the company. 
 
 Sec. 6. Ten per cent of the members shall have the right to initiate 
 any measure or policy that they see fit, and when such number of mem- 
 bers shall present a desired measure to the board the latter shall refer 
 the same to the stockholders for final action by referendum. 
 
 Sec. 7. Annually, as soon as possible after the end of the fiscal 
 year, after paying the expenses of the company and the management 
 thereof, including 4 per cent per annum deducted from the value of 
 fixtures and 3 rv;r cent per annum from the value of buildings, the net 
 profits of the one year preceding shall be divided as follows : 
 
 (a) On all shares of capital stock of this company subscribed and 
 
 settled for, a capital stock dividend at the rate of per cent per 
 
 annum shall be allowed, but in no case is this dividend to exceed the 
 net profits of such year. 
 
 (b) Then the board of directors shall set aside the following sums 
 to the following funds out of the remaining net profits of such year; 
 5 per cent to the educational fund and not less than 10 per cent to the 
 reserve fund; then the board shall apportion the balance of the net 
 total sum proifits of such half year among all the members and patrons 
 according to the amount of their individual patronage. (See Sections 
 3, 4 and 5, Article XI.)
 
 BY-LAWS OF A FARMERS' CLUB 
 
 Mr. A. D. Wilson of the Minnesota Agricultural Station 
 and St. Paul Farmer, under whose direction hundreds of 
 farmers' clubs have been organized in the Northwest, sug- 
 gests the following form of constitution and by-laws, which 
 may also be varied to suit the wishes of members : 
 
 Model Constitution 
 
 ARTICLE I 
 This Club shall be known as the "Farmers' Qub of ." 
 
 ARTICLE II 
 
 Its purpose shall be to further the material and social interests of its 
 
 members in particular, and of the people of , and the vicinity 
 
 in general. 
 
 ARTICLE III 
 
 Its general officers shall be a president, \'ice-president, a secretary 
 and a treasurer. 
 
 ARTICLE IV 
 
 Any person may become a member upon receiving a two-thirds vote 
 at any regular meeting, and paying one year's dues in advance. 
 
 ARTICLE V 
 
 This constitution may be amended at any regular meeting by a two- 
 thirds vote, upon one month's written notice, 
 
 By-Laws 
 
 Section l. The duties of each officer named in the constitution 
 shall be such as usually pertain to his position. 
 
 Sec. 2. All other duties shall be performed by an executive com- 
 mittee of three, which shall be appointed by the president annually upon 
 his assuming office. 
 
 Sec 3. The annual dues shall be one dollar ($1.00), payable in 
 advance. 
 
 235
 
 236 APPENDIX 
 
 Sec. 4. Regular meetings shall be held on the first Saturday of each 
 month, and special meetings may be called at any time by the president, 
 with the approval of a majority of the executive committee. 
 
 Sec. 5. The Club shall not engage in any commercial transactions, 
 but shall aid and further business associations among its members; 
 particularly such associations as pertain to the purchase of necessary 
 supplies, and the purchase, sale and management of stock and agricul- 
 tural and garden products. . ■, , ,, 
 
 Sec. 6. From time to time it shall give entertamments and hold 
 meetings, under direction of the executive committee, for the benefit 
 of its members and of those vi^hom they may invite to meet with them. 
 
 Sec. 7. The officers of this Association shall be elected annually at 
 the first regular meeting in the fall and hold their offices until their 
 successors are duly elected and qualified. , ^, , , • • 
 
 Sec. 8. Any member may be exnelled from the Club by a majority 
 vote at any meeting without a refund of dues. 
 
 Sec. 9. These by-laws may be amended at any regular meeting by a 
 majority vote upon a one month's written notice. 
 
 i
 
 PARLIAMENTARY RULES 
 
 Rules Which Should Be Observed in Conducting Meetings of Farmers' 
 Clubs, Fo-'.y* Women's Clubs, Co-operative Societies, etc. 
 
 In the absence of a president, the vice-president presides ; in the 
 absence of both, the secretary; or, in his absence, any other officer; or, 
 in the absence of all officers, any member may preside during election 
 of president pro tempore. 
 
 A point of order may be raised at any stage of the proceedings, and 
 shall be decided by the chairman without debate. The decision of the 
 chairman may be appealed from, but such appeal may be sustained only 
 by a two-thirds vote of members present. The chairman may submit 
 a point of order to the body, in which case a majority vote decides. 
 
 When the previous question is called for, it should be put in this 
 form by the chairman, and decided without debate: "Shall the main 
 question be now put?" If carried, and an amendment is pending, the 
 chairman should then first put the amendment. The chairman should 
 then put the main question, as amended (if amended) ; all should be 
 decided without debate. 
 
 Pending motion for the previous question, or after it has been 
 ordered, the chairman may entertain a motion to refer to a standing 
 or a special committee. 
 
 It is a breach of order for the chairman to refuse to put a question 
 that is in order. 
 
 A member desiring to speak should arise and address the chairman, 
 and should not proceed until recognized. The chairman should recog- 
 nize the member who first addressed him. The member recognized 
 has the floor. 
 
 No member when speaking should be interrupted without his con- 
 sent. To obtain consent, the chairman should first be addressed — as 
 for example: "Mr. Chairman, will the brother permit a question?" 
 or "statement" or "an interruption," etc. 
 
 No member should attempt to speak more than once upon the same 
 question without permission of the body, which should be determined 
 without debate. 
 
 Any member who in debate transgresses rules should be called to 
 order by the chairman, or any member may call him to order. He 
 should not proceed without permission, which should be determined 
 without debate. 
 
 A special order is consideration of a given question at a time cer- 
 tain. Any member may insist upon compliance with a special order. A 
 motion to change or postpone a special order should be decided without 
 debate. 
 
 If a question in debate contain several points or conditions, any 
 member may call for a division — that is, a consideration of each 
 
 237
 
 238 APPENDIX 
 
 proposition separately. The points of difference must be so distinct 
 that one being taken away the other will stand as a definite proposition. 
 
 When the result of a vote is in doubt, and a division is called for, it 
 may be determined by a rising vote — first, the "ayes," then the "noes." 
 
 A question of privilege arising from a dispute between members, 
 or for other cause, must be disposed of before the original question. 
 
 The mover of a question, or the member making a committee report, 
 has the privilege of closing debate upon the question. 
 
 If any part or point of an amendment is subject to a point of order, 
 the entire amendment is out of order. 
 
 No motion is in possession of the body until duly seconded. The 
 mover of a motion may, without consent of his second, withdraw it; 
 provided, the meeting may refuse this permission. 
 
 A motion may be reduced to writing on demand of any member. 
 
 No dilatory motion should be entertained by the chairman. 
 
 When motions are pending to refer a question to a special or stand- 
 ing committee, the vote shall be first upon reference to a standing com- 
 mittee; if upon different dates for specific purpose, the vote should be 
 first upon date most remote; if upon appropriations for a purpose, on 
 different amounts, the vote should first be upon the largest amount. 
 
 A motion to reconsider a question is decided by a majority vote. If 
 a majority refuse to reconsider, a second motion to reconsider can only 
 be entertained by unanimous consent. 
 
 A motion or resolution referred to a committee cannot be brought 
 back by a motion to reconsider. 
 
 An amendment to a pending motion is in order, an amendment to an 
 amendment is in order, but an amendment to an amendment of an 
 amendment cannot be entertained. A substitute to an amended amend- 
 ment is in order, and one amendment to the substitute may be enter- 
 tained. 
 
 When a question is pending, only the following motions are in 
 order : 
 
 (1.) To adjourn. 
 
 (2.) To lay on the table. 
 
 ^3.) The previous question. 
 
 (4.) To postpone to a time certain. 
 
 (5.) To refer or commit (synonymous terms). 
 
 (6.) To postpone indefinitely. 
 
 Tliese motions have precedence in the order given, and the motions 
 to adjourn, to lay on the table, and the previous question, are not 
 debatable. 
 
 A motion to adjourn when another member is on the floor is out of 
 order; but a member may yield the floor to another for the purpose 
 of making a motion to adjourn. 
 
 Points not covered by these rules are to be decided according to 
 Jefferson's Manual. — From Farmers' Union Constitution and By-Laws
 
 INDEX 
 
 PAGE 
 
 Absentee landlords, excess tax on 174 
 
 Accident insurance, co-operative 183-184: 
 
 Advertising, co-operative 130-131 
 
 Agriculture, its importance to the State 187 
 
 Amortization, methods of payment illustrated 49-50, 189-190 
 
 Amendments to by-laws 227, 235-236 
 
 Arbitrating disputes 15, 71, 184 
 
 Assessments on stock 230-231 
 
 Auditing books, importance of careful 80, 87, 120, 146, 163, 218-219 
 
 Bacon factories, Danish 189, 191, 192, 201 
 
 Baking, co-operative 213 
 
 Banks, agricultural 155-163 
 
 Barrow, Prof. D. N., assists the author 5 
 
 Berry growers, co-operative selling 90-94 
 
 Bonding officers 225, 228, 231-233 
 
 Borrow money instead of pay "time prices" 43-45 
 
 Boys, developing through co-operative business 152-153 
 
 Brands, importance of making a reputation for — 115, 118, 151, 214-215 
 
 Branson, E. C, quoted 24 
 
 Breaking rules, how to deal with members 92-93, 121, 139, 205 
 
 Building and loan association, rural 126-127 
 
 Business management of co-operative enterprises 123-125, 135 
 
 Butter prices, country vs. creamery 77, 124, 152, 198 
 
 Buying co-operatively 10-37, 135, 215-216 
 
 Advantages of large orders 42-43 
 
 Suggested prizes for farmers' clubs 59-60 
 
 Buying out old enterprises instead of starting new 26, 38, 39, 71, 80, 86 
 
 By-laws 72, 223-236 
 
 California, co-operative marketing of oranges, eta 130-136 
 
 Called meetings 226, 229 
 
 Camp, Prof. Wm. R., assists the author 5, 72 
 
 Capital stock in various enterprises— 73, 87, 91, 96, 114, 120, 124, 136 
 
 157, 160, 164, 195, 204, 225-226, 229 
 Cash system urged for co-operative societies 16, 39, 70 
 
 239
 
 240 INDEX 
 
 Cash system urged for individual farmers 43-45 
 
 Catawba County, N. C. 123-129 
 
 Cheese making, how co-operation saved Wisconsin farmers enor- 
 mous profits 97-98 
 
 CleanHness enforced in dairying 198-199 
 
 Citrus fruit, co-operative marketing of 130-136 
 
 City vs. country 30-31 
 
 City stores should sell cheaper to farmers, etc 41-42 
 
 Clover hulling co-operatively 66 
 
 CoUingwood, H. W., quoted 66 
 
 Committees for farmers' clubs 31-32, 35 
 
 Community spirit needed 30-31 
 
 Competition, unfair, how to meet it 88, 89, 92, 121, 196-197, 227, 231 
 
 Contracts, necessity for legal, binding forms 71, 92-93, 195-197, 220 
 
 Co-operation vs. capitalism 21-22, 176 
 
 Co-operation defined 23, 28 
 
 Co-operation, five needed lines 24 
 
 Thirteen rules 70-71 
 
 Co-operation, how to start 26 
 
 Co-operation insures reward for quality 198 
 
 Co-operation means threefold profits 191, 220 
 
 Co-operation, rapid growth in Northwest 95 
 
 Co-operative societies, number in Ireland 148, 151, 164-165 
 
 Denmark 194, 201, 213 
 
 Co-operative stores or warehouses 37-47, 92 
 
 Rules for 39, 45-46, 233 
 
 Dividends 39, 79, 82 
 
 Svea store 79-82, 86-87 
 
 Cotton, necessity for co-operative marketing and selling 100-112 
 
 An example of 137-141 
 
 Cottonseed, co-operative marketing 64-65 
 
 Need for 109-110, 139, 140 
 
 Coulter, Dr. John Lee, quoted 74, 228 
 
 Creameries, co-operative 13, 77, 94, 123-125, 151, 192, 194, 196-200 
 
 Credit unions 54, 155, 161-162, 217 
 
 Cutting prices, bad policy 70, 233 
 
 Dairying, co-operation to promote 192-193, 214 
 
 Denmark, rural co-operation in 186-220 
 
 Depreciation of property, allowance should be made for 234 
 
 Difficulties in starting co-operation 8, 149, 151 
 
 Directors, how elected, duties, etc 125, 154, 204, 225, 228-229 
 
 Directors, when they shall not vote , 225 
 
 Disaster as an incentive to co-operation 178-179
 
 INDEX 241 
 
 PAGE 
 
 Distribution of products regulated 115-116, 121, 131-134, 153 
 
 Dividends credited on stock 79, 233-234 
 
 Eastern Shore of Virginia Produce Exchange 113-122 
 
 Economies of co-operation, how it reduces expense, etc 41, 99, 111 
 
 114. 150 
 
 Education as an aid to co-operation 83-84, 187-188, 207-212 
 
 Educational fund 71 
 
 Egan, M. F., quoted 187-188, 190 
 
 Egg collecting 123-125, 153, 192, 204-205 
 
 England, co-operation in 172-177 
 
 Expensive service to be avoided 45-47 
 
 Faith in people a necessity 9 
 
 Farmers' duty to mankind 25 
 
 Farmers' organizations : Clubs, Unions, Granges, etc.__29-36, 56, 62-63 
 
 Farmers' Union 29, 56-62, 188 
 
 Federation of co-operative soci\;ties 115, 122, 132, 135, 153, 176-177 
 
 220 
 
 Fees, membership 86, 138, 156, 164 
 
 Fertilizers and feedstuffs, reduced cost through co-operative buy- 
 ing 10, 45, 180-181 
 
 Financing co-operative enterprises 87, 90-91, 195, 217 
 
 Fines or punishment for violating rules 92, 121, 139, 205 
 
 "Finishing" farm products 12, 24-26 
 
 Florida, co-operative marketing of oranges 130-131 
 
 Folk or people's high schools in Denmark 207-212 
 
 France, co-operation in 178-185 
 
 Goddard, L. H., quoted 41-42, 45-46 
 
 "Gombeen-men" in Ireland 149-150, 215 
 
 Government aid to agriculture, Denmark 213-215 
 
 Grading, farmers robbed by present failure to grade properly_-103-109 
 
 Grading products co-operatively 27, 118-119, 132, 141, 168-169, 198 
 
 Grain elevators, co-operative 80, 87-89 
 
 Grange indorsed .' 29, 56 
 
 Green, J. Z., quoted 53-54 
 
 Haggard, Rider, quoted 172-173. 199 
 
 Happiness through service 8-9, 17 
 
 Helplessness of individual shippers 117 
 
 High schools, Denmark's remarkable 209-212 
 
 Home ownership essential to development of co-operation 171-175 
 
 187, 219
 
 242 INDEX 
 
 PAGE 
 
 Illinois, co-operative insurance in 142-143 
 
 Incorporating, advantages of 72 
 
 Statement of purposes 73 
 
 Initiative and referendum in co-operative business 234 
 
 Inspection of products 118-119, 138 
 
 Insurance, co-operative or mutual, fire, etc 14, 126, 135, 142-146 
 
 182, 203 
 
 Accident , 183 
 
 Ireland, co-operation in 148-170 
 
 Land courts 174 
 
 Land ownership, Ireland 169 
 
 England 172 
 
 France 178 
 
 Denmark 187 
 
 Land purchase co-operatively 189-190 
 
 Land purchase, government aid to, Ireland 49, 169, 190 
 
 New Zealand 49 
 
 Denmark 189-191, 192 
 
 Land taxes, graduated 174 
 
 Laundry, co-operative 94-97 
 
 Leadership, an appeal for 7-9, 17 
 
 Live stock, co-operative purchase of pure-bred sires 13, 66, 182, 184 
 
 215 
 
 Live stock, co-operative shipping 98-99 
 
 Live stock, insurance 145-146, 183 
 
 Loans, expensiveness of, under ordinary banking 157-158, 161 
 
 Love of one's fellows necessary 9-10 
 
 Machinery, co-operative use of 10-11, 63-64, 164, 181-182 
 
 Maine, co-operative insurance in 142 
 
 Manufacturers, Danish, how farmers brought them to terms 216 
 
 Marketing crops co-operatively 11, 13, 65, 67-69, 185 
 
 Membership, limited to farmers 224, 230 
 
 Merchants, Danish, oppose co-operative buying 215-217 
 
 Minnesota, co-operation in 75 
 
 Need for co-operation 7 
 
 New members must not be debarred 71, 77 
 
 North Carolina, work of Farmers' Union 59-60 
 
 Fire insurance 143-144 
 
 Notice of meetings 227, 229, 230
 
 INDEX 243 
 
 PAGE 
 
 Oklahoma, cotton marketing studies 107-108 
 
 Old men alert 209 
 
 One-horse farmers, co-operation in plowing 193 
 
 "One man, one vote" 70, 119, 161, 197, 204 
 
 Organizing a co-operative society 70-74 
 
 Packing and shipping, importance of instruction 168-169 
 
 Pastors, country, their influence 78-79, 153 
 
 Patronage dividends, discussed and illustrated— 69, 71, 77, 79, 82, 86-87 
 
 119, 124, 153, 176, 197, 232, 233, 234 
 
 Plunkett, Sir Horace, quoted 58, 147, 166-167 
 
 Political prestige through organization 166, 179, 207, 220 
 
 Pooling prices 116 
 
 Potato marketing co-operatively 113-122, 127-128 
 
 Poultry, co-operative marketing 123-125, 151-154, 192, 204-205 
 
 Production, economical and scientific urged 60-61, 166-169, 200 
 
 "Productive purposes," loans limited .' 156, 158-159 
 
 Profits, increased through co-operation 94, 97, 98, 131, 135, 140, 143 
 
 152-153, 158, 159, 166, 204 
 
 Promptness as an asset 180-181 
 
 Proxy voting 230 
 
 Quality products, importance of__16, 77, 115, 118, 150, 198, 200, 203, 206 
 
 Quality, guaranteeing it by identifying product 93, 118, 138-139, 205 
 
 Quality products, insured by inspection 214-215 
 
 QuaHties of leadership 9 
 
 Race problem and co-operation in Southern States 16-17 
 
 Raiffeisen credit society 155 
 
 Railroad rates 93, 134, 184 
 
 Raw material, dividends on 227 
 
 Reading, importance of 84 
 
 Regularity of service important 68, 150, 193 
 
 Reserve fund, necessity for establishing 71, 227 
 
 Right Relationship League, mentioned 146 
 
 Rochdale pioneers 176-178 
 
 "Roll call of opinions," suggested for farmers' clubs 30 
 
 Rules for co-operation, thirteen fundamental 70-71 
 
 Rural credits 7, 27, 43-44, 47-55, 155-163, 217 
 
 Russell, Geo. W., quoted 30, 40 
 
 Savings habit must be encouraged 54-55 
 
 School tax in Svea, Minn 82 
 
 Secretary's duties 226
 
 244 INDEX 
 
 PAGE 
 
 Seeds, co-operative wholesale society 216 
 
 Share holding, individual, limited to 10 per cent 225 
 
 Shares, how offered for sale or transferred 224, 230 
 
 Shares, right of organization to buy 224 
 
 Shares, should be small 70, 73 
 
 Shuford, W. J., quoted 144 
 
 Size of farms in Denmark 219 
 
 Social life, co-operation to improve it 85, 184, 209-211 
 
 Stopford, E. A., quoted 179-180, 185 
 
 Surveys, rural 33-35, 128 
 
 Svea, Minn. 75-89 
 
 Swindler, how he robbed Danish co-operative societies 218-219 
 
 Telephones, rural 9, 77 
 
 Tenancy, ruinous to agricultural development 171-172, 174-175 
 
 "Time prices," heavy cost of 43-44 
 
 Torrens system land titles explained 51-53 
 
 Town patrons for co-operative stores 86 
 
 Trust competition 89 
 
 Volume of business, should be assured 216 
 
 Warehouses 45-47 
 
 Warehousing, co-operative for cotton growers 100-103 
 
 Water supply, co-operative 189, 199-200 
 
 Weather damage on cotton 101-102 
 
 WilHams, C. B., quoted 88 
 
 Wholesale societies, Irish 151, 153 
 
 English 176-177 
 
 Woman's work and organizations 10, 32-33, 85, 97, 129 
 
 Ireland 165-166, 170 
 
 Denmark 209
 
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 i
 
 Get a Copy of 
 
 "Fertilizing for Profit 
 
 > > 
 
 BY 
 E. E. MILLER 
 
 It is the best book on its subject for a man with no 
 previous knowledge of the subject that I have ever seen. 
 In fact, I know nothing to compare with it in usefulness 
 for the farmer reader." — Prof. C A. Keffer 
 
 CHAPTER 
 
 I. 
 
 II. 
 
 III. 
 
 IV. 
 
 V. 
 
 VI. 
 
 VII. 
 
 VIII. 
 
 IX. 
 
 X. 
 
 XL 
 
 XII. 
 
 XIII. 
 
 XIV. 
 
 XV. 
 
 XVI. 
 
 XVII. 
 
 XVIII. 
 
 TABLE OF CONTENTS 
 
 What Fertilizers Are and Why Used 
 
 What Commercial Fertilizers Are 
 
 What Nitrogen Does and How we Get It 
 
 About Phosphoric Acid 
 
 Potash in Commercial Fertilizers 
 
 Why Fertilizers Pay Best on Good Soils 
 
 How to Tell What Fertilizer a Soil Needs 
 
 The Special Needs of Different Crops 
 
 What the Analysis Means . 
 
 How to Do Home Mixing 
 
 Best Methods of Applj'ing Fertilizers 
 
 A Brief Review of Foregoing Chapters 
 
 Keeping Up Soil Fertility 
 
 Why Green Manures Benefit the Soil 
 
 When and How to Use Green Manures 
 
 Making and Caring for Stable Manures 
 
 How and When to Apply Stable Manure 
 
 The Profitable Use of Lime . . * , 
 
 APPENDIX 
 
 Plant Food in Typical Soils .... 
 
 What Crops Take From the Soil . 
 
 Fertilizing Materials in Feeding Stuffs 
 
 Analysis of Fertilizing Materials . 
 
 Value of Manure Produced by Live Stock 
 
 Composition of Farm Manures 
 
 Ten Sample Mixtures that Farmers Can Make 
 
 PRICE 75 CENTS 
 
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 cation. 
 
 First Principles of Soil Fertility 
 
 By Alfred Vivian. There is no subject of more ^ital 
 importance to the farmer than that of the best method 
 of maintaining the fertility of the soil. The very evident 
 decrease in the fertility of those soils which have been 
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 of the future must be based upon more rational practices 
 than those which have been followed in the past. We 
 have felt for some time that there was a place for a 
 brief, and at the same time comprehensive, treatise on 
 this important subject of Soil Fertility. Professor Vivian's 
 experience as a teacher in the short winter courses has 
 admirably fitted him to present this matter in a popular 
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 and scientific terms. It is pre-eminently a "First Book, 
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 quent reading. Illustrafd. 5x7 inches. 265 pages. Cloth. 
 
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 The Study of Com 
 
 By Prof. V. M. Shoesmith. A most helpful book to all 
 farmers and students interested in the selection and im- 
 provement of corn. It is profusely illustrated from photo- 
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 their part in making pictures and text matter a clear, con- 
 cise and interesting study of corn. Illustrated. 5x7 inches. 
 100 pages. Cloth- - - - -..-... Net, $0.50 
 
 (1)
 
 Soils 
 
 By ChAMLES William Burkett, Director Kansas Agri- 
 cultural Experiment Station. The most complete and 
 popular work of the kind ever published. As a rule, a 
 book of this sort is dry and uninteresting, but in this case 
 it reads like a novel. The author has put into it his in- 
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 book equally valuable to the farmer, student and teacher. 
 Illustrated. 303 pages. 5j/2x8 inches. Cloth. . Net, $1.25 
 
 Weeds of the Farm Garden 
 
 By L. H. Pammel. The enormous losses, amounting 
 to several hundred million dollars annually in the United 
 States, caused by weeds stimulate us to adopt a better 
 system of agriculture. The weed question is, therefore 
 a most important and vital one for American farmer! 
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 will prove invaluable to every farmer, land owner, gar- 
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 Cloth Net, $1.50 
 
 Farm Machinery and Farm Motors 
 
 By J. B. Davidson and L. W. Chase. Farm Machinery 
 and Farm Motors is the first American book published 
 on the subject of Farm Machinery since that written by 
 J. J. Thomas in 1867. This was before the development 
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 general application of power to the work of the farm. 
 Modern farm machinery is indispensable in present-day 
 farming operations, and a practical book like Farm Ma- 
 chinery and Farm Motors will fill a much-felt need. The 
 book has been written from lectures used by the authors 
 before their classes for several years, and which were pre- 
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 tical farmer. Profusely illustrated. SJ^xB inches. 520 
 pages. Cloth Net, $2.00 
 
 The Book of Wheat 
 
 By P. T. DoNDLiNGER. This book comprises a complete 
 study of everything pertaining to wheat. It is the work 
 of a student of economic as well as agricultural condi- 
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 <4)
 
 The Cereals in America 
 
 By Thomas F. Hunt, M.S., D.Agri., Professor of Agron* 
 omy, Cornell University. If you raise five acres of any kind 
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 The Forage and Fiber Crops in America 
 
 By Thomas F. Hunt. This book is exactly what its title 
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 the latest and most up-to-date information available. Illus- 
 trated. 428 pages. 5j^x8 inches. Cloth $1-75 
 
 The Book of Alfalfa 
 
 History, Cultivation and Merits. Its Uses as a Forage 
 and Fertilizer. The appearance of the Hon. F. D. Coburn's 
 little book on Alfalfa a few years ago has been a profit revela- 
 tion to thousands of farmers throughout the country, and the 
 increasing demand for still more information on the subject 
 has induced the author to prepare the present volume, which 
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 Clean Milk 
 
 By S. D. Belcher, M.D. In this book the author sets forth 
 practical methods for the exclusion of bacteria from milk, 
 and how to prevent contamination of milk from the stable 
 to the consumer. Illustrated. 5x7 inches. 146 pages. 
 
 Cloth .... $100 
 
 (S)
 
 Farm Grasses of the United States of America 
 
 By William Jasper Spillman. A practical treatise on 
 the grass crop, seeding and management of meadows and 
 pastures, description of the best varieties, the seed and its 
 impurities, grasses for special conditions, lawns and lawn 
 grasses, etc., etc. In preparing this volume the author's object 
 has been to present, in connected form, the main facts con- 
 cerning the grasses grown on American farms. Every phase 
 of the subject is viewed from the farmer's standpoint. Illus- 
 trated. 248 pages. 5x7 inches. Cloth $1.0 
 
 The Book of Com 
 
 By Herbert Myrick, assisted by A. D. Shambia, E. A 
 Burnett, Albert W. Fulton, B. W. Snow, and other most 
 capable specialists. A complete treatise on the culture, mar- 
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 farmers, dealers and others. Illustrated. 372 pages. 5x7 
 inches. Cloth $i-50 
 
 The Hop — Its Culture and Care, Marketing and 
 Manufacture 
 
 By Herbert Myrick. A practical handbook on the most 
 approved methods in growing, harvesting, curing and selling 
 hops, and on the use and manufacture of hops. The result ofi 
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 be an authority on this crop for many years to come. It takes 
 up every detail from preparing the soil and laying out the 
 yard, to curing and selling the crop. Every line represents the 
 ripest judgment and experience of experts. Size, 5x8; 
 pages, 300; illustrations, nearly 150; bound in cloth and gold; 
 price, postpaid. $i-50 
 
 Tobacco Leaf 
 
 By J. B. Killebrew and Herbert Myrick. Its Culture and 
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 19)
 
 Feeding Farm Animals 
 
 By Professor Thomas Shaw. This book is intended alike 
 for the student and the farmer. The author has succeeded in 
 giving in regular and orderly sequence, and in language so 
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 the science and practice of feeding farm animals. Professor 
 Shaw is certainly to be congratulated on the successful man- 
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 peared on the subject of feeding farm animals. Illustrated. 
 5J/2 X 8 inches. Upward of 500 pages. Cloth. . . . $2.00 
 
 Profitable Dairying 
 
 By C. L. Peck. A practical guide to successful dairy man- 
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 practical, being principally a description of the methods prac- 
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 farm of Rev. J. D. Detrich, near Philadelphia, Pa. On the 
 farm of fifteen acres, which twenty years ago could not main- 
 tain one horse and two cows, there are now kept twenty-seven 
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 Practical Dairy Bacteriology 
 
 By Dr. H. W. Conn, of Wesleyan University. A complete 
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 Modern Methods of Testing Milk and Milk 
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 By L. L. VanSlyke. This is a clear and concise discussion 
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 Illustrated. 214 pages. 5x7 inches $0.75 
 
 (12)
 
 Animal Breeding 
 
 By Thomas Shaw. This book is the most complete and 
 comprehensive work ever published on the subject of which 
 it treats. It is the first book which has systematized the sub- 
 ject of animal breeding. The leading laws which govern this 
 most intricate question the author has boldly defined and 
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 rest the wildly speculative views cherished with reference to 
 these questions. The striking originality in the treatment of 
 the subject is no less conspicuous than the superb order and 
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 of the book. The book is intended to meet the needs of all 
 persons interested in the breeding and rearing of live stock. 
 Illustrated. 405 pages. 5x7 inches. Cloth. . . . $1.50 
 
 Forage Crops Other Than Grasses 
 
 By Thomas Shaw. How to cultivate, harvest and use 
 them. Indian corn, sorghum, clover, leguminous plants, crops 
 of the brassica genus, the cereals, millet, field roots, etc. 
 Intensely practical and reliable. Illustrated. 287 pages. 5x7 
 inches. Cloth $1.00 
 
 Soiling Crops and the Silo 
 
 By Thomas Shaw. The growing and feeding of all kinds 
 of soiling crops, conditions to which they are adapted, their 
 plan in the rotation, etc. Not a line is repeated from the 
 Forage Crops book. Best methods of building the silo, filling 
 it and feeding ensilage. Illustrated. 364 pages. 5x7 inches. 
 Cloth $1.50 
 
 The Study of Breeds 
 
 By Thomas Shaw. Origin, history, distribution, charac- 
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 accepted text book in colleges, and the authority for 
 farmers and breeders. Illustrated. 371 pages. 5x7 inches. 
 Cloth $1.50 
 
 Clovers and How to Grow Them 
 
 By Thomas Shaw. This is the first book published which 
 treats on the growth, cultivation and treatment of clovers as 
 applicable to all parts of the United States and Canada, and 
 which takes up the entire subject in a systematic way and 
 consecutive sequence. The importance of clover in the econ- 
 omy of the farm is so great that an exhaustive work on this 
 subject will no doubt be welcomed by students in agriculture, 
 as well as by all who are interested in the tilling of the soil. 
 Illustrated. 5x7 inches. 337 pages. Cloth. Net . . $1.00 
 
 (13)
 
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