THE FARMERS INDEMNITY

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the National Bureau of Economic Research at $9,589,000,000 for
1919 and at $3,965,000,000 for 1921. The former figure represents
 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 probably
 nearly a hundred per cent higher than the cost of maintaining
 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 outweigh
 the fraction of the mortgage interest that is paid directly
to farmers.