Economic essays

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Monograph

Identifikator:: 1753623200

URN:: urn:nbn:de:zbw-retromon-136107

Document type:: Monograph

Title:: Economic essays

Place of publication:: New York

Publisher:: Macmillan

Year of publication:: 1927

Scope:: viii, 368 S.; Ill., graph. Darst.

Digitisation:: 2021

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: The farmers' indemnity / Alvin S. Johnson

Collection:: Economics Books

THE FARMERS INDEMNITY TE Re al Tl yr 217 the National Bureau of Economic Research at $9,589,000,000 for 1919 and at $3,965,000,000 for 1921. The former figure repre- sents the highest point in the history of American agriculture, the latter a low point, although by no means the lowest. To be on the safe side, however, we will put the income of the American farmer at nine billions for the best years and six for the worst. The average will not exceed seven billion and a half. If the constituent elements in income are valued on the same basis of world prices, the German income pretty certainly exceeds that of the American farmer. The German national income has to feed twice as many mouths. But the American farmer's standard of living is higher. The average cost of maintaining an American farm family is prob- ably nearly a hundred per cent higher than the cost of maintain- ing a German family. If the American farmer could lower his standard to the German level he would perhaps have a greater surplus for debt payment. But his standard is already painfully low as compared with that of the town worker, and any further lowering would lead to a great exodus of the younger farm workers to the cities. On the face of these calculations it appears that the burden of debt resting on the American farmer is at least as heavy as the burden of indemnity resting on the German people. But are we not overlooking an essential point of difference? Some part of this mortgage indebtedness is simply a matter between farmers. One farmer sells a part of his land to another and takes a mortgage. One farmer pays interest and another receives it. The beneficiaries of the German indemnity are all non- (Germans. But interest on mortgages by no means exhausts the indemnity burden on the American farmers. Much land is owned by men who live in cities and towns, who receive rents as absentees. Especially in the South the farm population is heavily burdened by exorbitant interest rates on crop liens. The farmer everywhere secures a large part of his supplies and equipment on credit, and pays concealed interest at high rates. In considering the balance of payments between town and country these items have to be taken into account. In their aggregate they must greatly out- weigh the fraction of the mortgage interest that is paid directly to farmers.

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