The Magic Box
A forgotten masterpiece full of important lessons by K. E. Gherity, 1929
Publisher’s Note: There are countless little gems like this one lost to time, war, and the digital age; languishing in public domain where no-one promotes or distributes them. Disappearing into the abyss so rare almost no-one has a copy. Well I think it’s important that we not forget the lessons of the past. There is wisdom here worth its weight in gold for anyone, not just farmers. These are lessons in business and the kind of threats operators face from “organizers”.
The events in this story may never have happened. Farmer John, while not wholly an imaginary person, is a composite picture. His experiences might be told by many of the brave souls who have turned the Northwestern prairies into the “Bread basket of the world.”
The author has enjoyed the hospitality of your homes; hauled feed in the bitter cold of the dead of winter and bundles to the threshing machine on the
long hot days in the fall. He has known your problems and studied your efforts. If this little story saves one heartache; if it awakens one person to the
insincerity of certain so-called “leaders” — the hopelessness of success under such leadership —and saves them from certain losses of money, hard earned and much needed, the story will not have been told in vain.
To the men and women of the great Northwest who toiled early and late; to those whose time is devoted to the oldest and most necessary of all human
endeavor — Agriculture: to those who have given to the world many of our greatest men and women; to those whose product feeds the world; to those
whose simple trust and honest faith have returned only a harvest of “blasted hopes” under the banner of false cooperation- — to those who “Farm Farms”
this tale is sincerely dedicated.
— THE AUTHOR.
Let me see again the morning mists
Lift at the spring sun’s glow
And the good brown earth that meets the sky
Out where the cool winds blow.
THE eastern sky was beginning to show little gray streaks of daylight over the Northwestern prairies on a cloudy spring morning. The tall poplars in the grove resembled specters in the dim light. Signs of life were heard in the farm buildings on John Olson’s farm in Prairie Township. The old Plymouth Rock rooster stretched his wings and crowed lustily to impress upon the hens his importance in the world and help, as he firmly believed, to bring the sun up. The red heifer mooed to her calf penned up in the horse barn. Bess, the old
gray mare, whinnied and pawed the manger for her breakfast.
In the east bedroom of the farm house the alarm clock rang and Farmer John, as he was familiarly known to his friends, slowly opened his eyes to greet
another day. He slid out of bed and dressed hastily; the house was chilly. Sometime he hoped to have a modern house with a heating plant — it would be more comfortable.
Downstairs he stirred the fire in the heater and put on some fresh coal. He built a fire in the kitchen range, put over the teakettle and called his wife and
the hired man. It was seeding time and there wasn’t any time to lose.
As he stepped through the farm house door a gentle south wind greeted him. The sky was cloudy — he wished it would rain. He was well along with
the early seeding and a nice gentle rain would start things growing. In the barn he fed the work horse generous measures. They were working pretty hard and needed plenty of feed. As he was about finished putting hay down to the cows his hired man came through the door with the milk pails. John took
the young cows, those timid and nervous. He liked to break his own stock. He thought it would keep them gentle, and a well broken heifer meant a gentle
cow. Born and raised a farmer, John had in him the love of livestock so necessary to success, and he had a personal pride in everything on the place.
When they finished milking they carried the milk pails to the house. The hired man turned the separator while John poured the milk and changed the
pails. There would be another can of cream to go to town today, and the warm skimmed milk made fine feed for the young pigs. As John carried the milk to
the hog house he was thankful for the nice new building. Fifty-five nice fat little pigs in a good warm modern hog house. Well started with plenty of
feed, they should weigh 200 pounds in six months and be ready for market. It was work, of course, and lots of care was necessary to save the youngsters
in the cold spring mornings, but with the help of modern buildings and proper feed, he had been able to save all but two of his spring pigs — the best record he had ever made.
As the hired man finished feeding the brood sows the welcome call for breakfast came from the farm house. Home cured bacon, fresh eggs, pancakes and coffee — -an hour of morning chores gave one an appetite for breakfast.
The four children came downstairs to dress by the heater in the living room — two boys and two girls; the oldest, John Jr, was twelve. It wouldn’t
be long until he would be considerable help to John, and not much longer until he would probably be farming for himself. John bought the quarter section a mile south last year with that very idea in mind. When they had finished breakfast John and the hired man went to the barn to hitch up. He must try to finish seeding his spring wheat during the forenoon. This meant a busy morning because the clouds were threatening rain and they would have to work fast. Ole could continue with the spring plowing. John loaded his wagon with the seed wheat, nice clean Marquis well treated for smut. He had grown this the year before on a piece of corn ground. It was fine seed and John looked forward to a reasonably good harvest.
Things were, generally, better for John than they had been a few years back. He had changed his system from straight wheat farming. He had taken
to milking some cows; keeping a few sheep — they helped to clean up the land; raising some hogs, and even Mrs. Olson’s poultry, so long considered a sort of necessary evil, had thrived in the poultry house that had been built. They had had eggs all winter, and last fall John’s wife had 80 nice turkeys to go to market. The income from the turkeys had made a happy Christmas for the children and bought the new radio.
John hitched his team to the drill, filled it with seed and methodically started the long straight drill rows. He took a pride in his drilling.
Now great is the mercy of Allah
That the sharper is given to sloth
While he sleeps his victims are scathless
And peace is the portion of both.
ABOUT the time John had finished his sixth round, Mr. Peter A. Brown, better known among his associates as “Slick Pete,” organizer and high pressure stock salesman, slowly opened his eyes in the front bedroom of the Northwestern
hotel in town. He closed them again suddenly — he wondered if his head would ache. He had helped consume his share of a bottle or two of Canadian
Scotch with a couple of congenial traveling men the night before. He slowly made up his mind that no matter how hard it was he would have to get up and
start out. It was daylight and spring was the best time for his business. Expenses were high and Scotch cost ten dollars a bottle. His hotel bill was about $3.00 a day; it cost him nearly $5.00 to run his car. Organization work was not as easy as it had been in years gone by. He would have to get out and hustle.
Pete sized himself up in the mirror — he wouldn’t shave this morning; He would look more like a farmer if he left his whiskers on. He would put on
an old suit and maybe a pair of overalls, because it didn’t pay to look too prosperous in this kind of work. Downstairs he had breakfast — orange juice,
two poached eggs on toast and black coffee. On his way to the garage he wished he had a good “bird dog”.
NOTE: “Bird dog” is the stock salesman’s vernacular for a
farmer who rides with a stock salesman and introduces
him; the implication being that the bird dog finds them
and the salesman gets them.
These farmers, who ride and introduce a fellow, were getting harder to get. In the old days they seemed anxious to go out and help with organizing and stock sales. Recently some of them were even asking for a split of the
organizer’s commissions. Pete’s expenses were high and he wasn’t used to dividing with any one, his natural desire being to get all that he could and keep what he got. It was little enough in these days. Seven or eight years ago a man could make $200.00 or $300.00 a week selling stock, dead easy. Nowadays Pete had to work six or seven hours a day to make $100.00 a week and he needed $100.00 to pay his going expenses and make payments on the car.
While he was getting gas he sized up his tires nearly worn out. This thing of driving 100 or 150 miles a day selling stock was expensive. The old
bus had gone nearly 100,000 miles, and repairs were high. Pete started out on the north road. He had put in three days working south and west of town
without any success. He couldn’t get started; couldn’t seem to break the ice. The farmers were more skeptical than they used to be. The old line of sympathizing with them and damning everyone didn’t work as well as it had in the past.
Almost every farmer Pete talked to had asked him if he had seen John Olson. Pete had been told that this man, John Olson, was a tough nut to crack, but
he seemed to be the “key” man of the community. The farmers had said that if John Olson had signed up, they might. Pete figured that with john Olson
heading the list he would have more than a reasonably good chance of successfully effecting the organization of a “local.” He had tried to stay away from John and hem him in with other signers, but it didn’t seem to work. Now he would tackle John.
Pete was almost desperate. He had overdrawn his account with the head office and they had frankly told him that he must get results or no further advances would be made. He stopped at the farm house where he was told that John was seeding on the northwest quarter. As he drove around the corner he noticed John headed toward him on his final round. Pete put forth his best manner and shook hands vigorously. He introduced himself as the Special District Organizer of the new National Farmers’ Co-operative Marketing Association “sponsored by the government.” Pete explained that this was an effort “the result of many years of intensive study by the best minds interested in cooperative marketing” to organize and place in operation a farmers’ own agency which would defeat the aims of their arch enemies “the grain gamblers” and save the farmers from absolute ruin. (This line of
argument was usually effective as an introduction.) John smiled. Pete explained that he had made a survey of the district and upon his recommendation his company had decided to launch one of their “locals”
for the benefit of John and his neighbors.
Something must be done. The down-trodden farmer must be saved. There was an organized effort on behalf of Wall Street (Pete was a little uncertain
about this place called Wall Street. He understood, generally, that it was in New York, but just how and why Wall Street should be the arch enemy of a
farmer, Pete could not explain) to make serfs of every farmer in the United States. Did John know that the mortgaged indebtedness on all Northwestern
farms was getting larger annually? In this state the average per acre mortgaged indebtedness was $36.00 per acre. (Pete was doing a bit of guessing. He had heard a speaker mention it once, but he had forgotten
the exact figure— well, probably John didn’t know either — $36.00 sounded large and would probably be effective), and in many other states this amount was considerably more.
Did John know that the city banks were carrying on a campaign to close up all of the small banks in the country? Did John know that the organized grain gamblers were plotting and planning to reduce the price of grain to a place where “starvation confronted the men on the plow”? That last phrase was another good one; Pete had sold a man $500.00 worth of stock in a packing plant once on the strength of that quotation. John smiled. Pete wondered what the smile meant. Was it a smile or a smirk?
The barn — a lowly place for men to meet
Serene it stands above all mortal scorn.
Its wall: have held the destiny of men
And ’neath its roof Incarnate Truth was born.
IT started to rain. “I’ll have to talk to you a little later,” said John. “I’ve just finished up this piece and I want to get to the house before I get wet; looks like we are going to have a good soaker. Come on down to the house if you like and I’ll talk to you a little.” John hitched his wagon behind the drill and drove slowly to the house, while Pete came around by the road and met John at the machine shed. John was glad he had that machine shed. It didn’t cost much to build it and was a protection to the machinery that paid for itself many times.
Pete was waiting as John drove up. Quite a heavy rain had started. “Unhitch on that side,” said John to Pete, “so I can get my team in the barn. No, you don’t unbuckle that tug at the hame — just drop it from the whiffletree.” Pete was forced to expose his utter lack of knowledge of farming. He unbuckled a belly-band on the right hand side and made other errors. “Funny why ’tis,” said John to himself, “that some fellow comes from the city to tell us how to run our business who doesn’t know how to hitch up a horse.” Ole drove up with his team about the same time and John helped him, and they settled down in the barn to wait for the rain to pass.
John didn’t mind wasting a little time. He had been waiting for an opportunity to tell somebody some things he had on his chest. Pete was thankful for the rain. The crops made some difference to him, but mostly it would give him an opportunity to put in a long time with John and “get his name on the dotted line.” They visited a while on general subjects when Pete again opened the matter of obtaining John’s signature on a membership note. After Pete had used his best arguments, he was surprised when John answered: “I guess I’m not interested, Mister, I have already joined that.” “That’s funny,” thought Pete, “I didn’t know that there had been any other organizer in this district.”
“When did you join?”
“Well, the first time was around twenty years ago,” said John. “I just forgot what it was called, I know it had some different name but it was the
same thing. Let’s go in the house — looks like an all day rain, I’ve got something I want to show you.”
As they entered the house John called to Mary, his wife. “Where did you put that little tin box with all those papers in it that I call my ‘chest of
blasted hopes’? On the closet shelf? All right, I’ll get it.”
Pandora’s box, whose opened lid
Let every trouble loose upon mankind,
Was kinder than the casket of the farm
For in Pandora’s — Hope remained behind.
PETE and John sat in the living room, and John slowly opened the little tin box. “Here it is, stranger, it contains a part of the things I’ve joined. It’s raining today and I’ve just been dying to tell someone about it. Organizers always have plenty of time and since I can’t work in the field, I might just as well take this chance to get this job done.”
Pete looked puzzled. Here was a funny duck. Wonder what he was talking about? Was he kind of “cracked”? Well, he would let John talk and after he got through Pete would start in again. He had his stock arguments; if he could stay long enough, John would probably sign up to get rid of
him, if for no other reason.
John opened the box and pulled forward a sheaf of papers — stock certificates, certificates of membership, paid notes and cancelled checks; fire insurance
policies and one picture. “I might just as well start this thing from the first,” said John, “because I want to show you that I really have joined. Here’s the first one, the Grangers. Mary and I were married around 20 years ago and we moved on to this farm. I rented it, her folks and my folks gave us a small
farming outfit and some seed to start in with. We worked hard and had a fair crop that year. We laid a little by. I made a crop contract on this quarter and a down payment. That winter a fellow came through here organizing the ‘Grangers.’ My father had been a member of the Farmers’ Alliance — the
Populist Party — and a lot of other things that I can’t remember. So I joined; everybody joined. It swept through the country like wild fire. We had
meetings, first in the school house.
“There was a plan that we were going to buy and sell everything that we needed cooperatively and cut out the ‘middle men’ both in buying and selling.
‘The middle men’ were taking all the profits, the speakers told us and if we were going to have success we had to do away with them. And so we
joined — Mary and me along with our neighbors.
“Things went along pretty good for a while, and finally we had a meeting and made up our minds to build the ‘Grangers’ hall. We kind of clubbed in
together, a few of us signing a note for the lumber and the bank advancing the money to pay for it. There were quite a few members who could do carpenter work and we had a couple of ‘bees’ donating our work and built the hall. We had a meeting room and, in the basement, we had a kitchen and a
lot of long tables and a place to eat. We even had a stage at one end of the room where we used to have sociables and school exercises. What fun We had! In the winter time the women folks used to gather about once every two weeks and have a supper. One would furnish chicken, others cakes; somebody
would bring cabbage salad and we would have a big supper. The women folks knew how to run their part all right. It was like their business and they
made a success of it. Sometimes we would have a speaker from the outside and there was lots of interest at first.
“Then we went into the idea of cooperative buying. The Secretary was going to handle the thing. We sent away and got a carload of flour, two carloads of coal, and a carload of posts. The prices were cheaper than we could get them from our town merchants and we figured the saving to be considerable. The first car of coal was pretty good. It was what they called ‘All rail’ coal, but was a little short of weight. The second car they said the preparation wasn’t good and there was a lot of dust and fine stuff in one end that no one wanted. Well,
the secretary, myself and a couple of other fellows took this fine stuff home and paid the same price as the others paid, but we didn’t get our money’s worth, we thought. So that didn’t work out.
“The flour came along, some took two or three sacks, some of the members with big families took up to a ton. This flour came from some mill some
place that made a specialty of selling flour to the Grangers, so they said in their letters, but I guess it wasn’t the kind of flour our women were used to
baking with. Anyway they all kicked about it and one of my neighbors fed the last of his to the hogs when his wife got mad and wouldn’t use it. We wrote to headquarters about it, but they said that they didn’t know anything about the mill, that the mill just sent in an ad to their farm paper and that they didn’t guarantee anything. We only got a couple of sacks of this flour and I guess we finally used it up. I didn’t hear the last of it for a long time. Mary told me that in the future she would buy her flour in town from the storekeeper and if
it wasn’t good she would take it back again.
“The posts came and they had been shipped with a draft attached to a bill-of-lading. We had to pay for the car before we opened it. A few of us got
together and signed a note at the bank to borrow the money until the posts were paid for. When we opened the car we found that the posts weren’t as
big as the fellow who sold them to us said they would be, but we had already paid for them so we had to keep them. We sold them out at just ‘cost.’ I think
it was seven cents apiece, and that was two cents cheaper than we could get them in town, but when we came to the end of the car we found that either
we had missed count or made a mistake in calculating, or that there wasn’t the right number of posts in the car. Anyway, we fellows who signed the note
had to go down into our jeans and dig up $26.00 to bring the thing out even.
“Well, that put an end to our cooperative buying and folks kind of lost interest in the ‘Grangers.’ Only a few members paid their dues after that, and finally we surrendered our charter. We had the hall. It was used for elections and an occasional neighborhood dance and sort of run down generally. One fall about threshing time the thing caught fire and burned down. They said some tramps were smoking in there and had been careless with cigarets.
At any rate, we fellows who were on the notes figured that the insurance would take care of the note. There was a few hundred dollars still unpaid. When we checked the thing up we found that the insurance had lapsed about five or six months before. The Secretary had paid the premiums himself one year and had made up his mind not to do it any more. You see, Mister, it wasn’t anybody’s business in particular and nobody cared much. At any rate the bank had the note. We fellows that were on it went around and talked to our neighbors about making donations to pay the note but there wasn’t anything definite done and no one put in any money. Finally five of us got together and the bank took a discount and we cleaned it up. And that was the end of when I joined the first time.”
I’ve read the Scripture keerful where it sez
“Put not your trust in horses” and I’m vext
I’d add a word — ef — en it worn’t ferbid
’N put horse dealers in the sacred text.
“LET’S see what else we’ve got in this box. Now, here’s something,” and John pulled forth a picture of a very fine horse. “That’s a picture of an imported registered stallion that we had here one time and one of the best deals on the face of it that I ever went into. A stranger came along here one day driving a fine team. He drove into my yard, shook hands and told me that he represented the National Horse Improvement Association of America; his company was interested in the improvement and development of fine draft horses. They had selected a few of the progressive farmers of the community who had the best brood mares and had determined to make those men a present of a registered stallion. This movement was purely philanthropic. The way it was done was this: Seven of us would form an association, each would agree that he would have five mares bred each year for five years at a service fee of $20.00 for each mare annually. If we signed this agreement they would
make us a present of the horse — an imported horse, too, mind you! He was supposed to weigh 2,200 pounds and be coal black. When he got here he was
brown; and weighed about 1,800, fat. One of the members was to keep the horse and he was to be paid for his trouble from the fees derived from those
who were not members. He figured we could get 50 mares at $20.00 apiece, which was an income of $1,000.00 and that $1,000.00 would pay for the
horse’s keep and yield us a profit besides.
“It sounds good, doesn’t it? Well, we found out afterwards that this agreement that we signed to
breed these mares was really a note in which each one guaranteed the full payment of $3,500.00, and 30 days after we signed the note a bank wrote to us and told us that they had bought the note and would look to us for payment that fall. Two years later the horse died.
“I forgot to tell you that this man who gave us the horse guaranteed that his company would buy all of the colts which we would raise from this horse
at prices ranging from $200.00 to $350.00 each. He said they were commissioned to buy from us for the fire departments in the cities and that he would be back and buy all of our colts as soon as they were four years old. Did you notice that gray team Ole had on the lead on the plow this morning? Well, they are full brothers — seventeen and eighteen years
old this spring. They were sired by that horse whose picture you are looking at right now. I’ve been saving that team ever since for that fellow to come
back like he promised he would, and if he came, I wouldn’t want to disappoint him. They are a darn good team.”
Pete couldn’t think of anything to say just then, but John reached into the box and pulled out another paper. “Let me see, I want to show you the next
one. This is a membership certificate in the Equitable Society. That thing started along about sixteen years ago — maybe seventeen. Their slogan was ‘Dollar Wheat.’ It was an educational society. They didn’t have any regular marketing program — all they did was educate farmers to co-operation. You paid your membership fee, and they taught you the benefits of co-operation. Gee, Mister, I should know something about cooperatives, I’ve been educated
for nearly twenty years on it. “Well, they established what they call ‘locals’ just
like the ‘Grangers’ and we did the same things. We had meetings, heard speeches, subscribed to papers, paid our dues, and out of that they made up their minds that we should organize a farmers’ elevator. Then besides the farmers’ elevator we were going to have a farmers’ company and sell our grain and livestock, wool and whatever we raised, potatoes — I guess, too — and have big elevators in the terminal markets. Everybody signed up for stock in the farmers’ elevator and most everybody signed up for stock in the Equitable Exchange. The elevator bought stock in the Terminal Association. The way they were going to have it was that our farmers’ elevator was going to ship all of the grain they received from members to the farmers’ own company at the terminal markets and then when the thing got large enough we could control the surplus so that we could sell everything at cost — plus a reasonable profit. That was what the speakers said. They had some great speakers with that association. I used to enjoy listening to them. They told us about the grain
gamblers and about how tenancy of farms was increasing, and about how they were going to market our products direct to the consumer. In fact, they
told us a lot of things. I found out years after that the principal speaker
had gone broke trying to run a grain business of his own in the terminal markets. When he couldn’t run his own business, he took a job with the farmers’ company at a fat salary.
“I remember when I bought this stock,” and John took from the box a beautiful engraved stock certificate. “You see this stock was to earn an 8 percent interest dividend. Well, I gave a note for $300.00 worth of stock. The note bore 8 per cent interest and the stock was to pay 8 per cent — one just offset the other. Besides I was to get a patronage dividend and my patronage dividend was to be applied on the note until the note was paid. After
that I was to get my dividends in ‘cash.’ I know I should have known better, but, you see, I hadn’t joined so often up until this time. I never got the
patronage dividends but I did pay the note.
“Well, things went along pretty good in our farmers’ elevator for a while. They shipped their grain to the Equitable Exchange and we had big meetings
every winter and even had a couple of big meetings down to the cities. Had processions and bands, dedicated our terminal elevator and had a banquet.
The speakers used to come to these meetings and they always told us about the indirect benefits which we got. When we bought stock they kept talking
about cash dividends. Later, when the dividends didn’t come, they talked about indirect benefits and correcting the evils in marketing. I found out after-
wards that about all they did was to turn the grain we shipped to them over to some regular commission company and the result was that we bought the same service but paid two commissions. Our grain was sold about to the same people that bought it before and I suppose for about the same price — — less, if anything.
“Now this Equitable Company had a sort of supervision over our local elevator here. Our local elevator man got to speculating in the market. I was one of
the directors here but I didn’t just understand the speculation myself. They said it was ‘hedging,’ but at any rate we lost almost $30,000 before we woke
up. Well, I was on the notes for the $30,000 and so were a lot of other fellows around here and it worried us quite a lot. We weren’t qualified to keep
close touch on our local business and the directors of the Equitable Exchange were farmers just like ourselves and they didn’t keep a close tab on things.
The men who were to look after the business down below were for the most part honest, I believe, but they lacked experience. I don’t blame any one in
particular for what happened. I figure it just happened because everybody’s business is nobody’s business.
“About the time things were getting real bad in our local elevator here, they were getting pretty bad for the Equitable Association and they sent a man
out here telling us we would have to pay what we owed. Well, we sent a committee down to the city to see them and this committee went over to Minneapolis. I wasn’t along, but when they were over there they made arrangements with a regular commission firm to take over our business. The Equitable Association agreed to take a discount on what we owed them if they could get cash. They needed it badly and the commission man’s agent told us
that if we would sign up to guarantee the account in a business-like manner and make our manager report to them on every transaction and would HEDGE our grain like the regular grain companies did and not speculate, that this commission company would advance us enough money to straighten things out and carry us until we could pay up. They said they would help in the administration of our business and we figured by that time that we needed help and so we switched our business. We figured later that our service was more prompt, that we got better sales, and this commission company having their own money advanced kept a pretty close tab on things and would not permit land speculation. We made kind of reasonable profits; we still owe them some money, but I think that the farmers’ elevator will work out if they keep their business on a business-like basis.”
John was looking through his box of “blasted hopes.” He came across three stock certificates carefully pinned together. They represented an investment of $1,200.00 in three cooperative packing plants. Pete recognized the colors — memories of the palmy days when stock selling was easy came back
to him. He had worked on two of these. On one, when the going was good, Pete’s commissions had run as high as $100.00 a day. An organizer needed
to work about half time then and he had plenty of money to spend.
“This was a good proposition,” said John. “You know some of the big packers made lots of money, so the organizer said. We were to have big modern
plants in different places. We were to ship in our livestock and they wouldn’t charge us any commission, yardage or feed, and we were assured of the
very highest market price for all of the stock we raised; our meats to be prepared and cured closer to home. We would have less shrinkage on our shipments. Due to savings, we could buy our meats much cheaper; and the cash dividends that now went to the big packers would come back to the farmers — where they belonged. That’s what the organizer said. I
gave my notes in exchange for this stock — just like I had done before.
“We had a board of farmer directors. I knew most of them and they were fine fellows. Our officers, I think, were honest, but they didn’t have much money
invested themselves and all they knew about meat packing they learned at our expense. When they opened up the plant that was nearest to here they
wrote us letters telling us to have our shipping association send our shipments to that market. The farmers believed in them— they had been educated
to ‘stick’ and be ‘loyal,’ and so they sent their hogs, cattle and sheep down there because the freight was a little bit less and they saved the commission and were to get the profit.
“It seems like the business was not managed well, because they received lots more hogs and cattle than they could possibly take care of. They didn’t keep
the yards clean and as a consequence hog cholera broke out in the yards and a fellow told me who was there that hogs died like flies. Well, they had to
gather everything up that they couldn’t kill and ship it on down to the regular markets. A funny thing about that was that when our cooperative packing
plant shipped their surplus stock to the regular terminals they didn’t ship to the cooperative companies. They shipped to the old line commission
firms and I couldn’t understand — and don’t yet — just why they urged us to be loyal to the cooperative company and patronized the old line fellows themselves. But I guess there is no doubt that this is true. This one packing plant that I have heard most about created a large surplus of packed meat. They didn’t have an efficient sales organization and they had a small outlet. The market went down and they lost lots of money on what they had on hand. They had done business with a lot of irresponsible firms who didn’t pay for what they bought.
“Finally, they had to close up. I hadn’t paid my note for stock at the time they closed and one day I got a letter from a lawyer who told me that if I didn’t pay right away that they would sue me. Most of my neighbors got letters of the same kind on the same mail and they did sue me along with lots of
others. I settled for that stock by paying half of the note and I understand that half of what I paid went to the lawyer and I guess the other half went to the
receiver. At any rate, I didn’t get any dividends which had been promised me. And the funny part of that whole business was that the very lawyer who sued me for that stock note is one of the fellows that’s making speeches now to get farmers to join a new organization. I suppose he figures that his income will come two ways: First, he will get paid for making the speeches that get the farmers to sign up, and then he’ll get his lawyer’s fees for collecting the notes and maybe what they call ‘legal counsel’ for the receiver. That’s the way it worked out before and probably will again.”
The slogans, shibholeths and war cries we shouted;
The hanks and the mills and the stores that we started!
Who could believe that the Cause would be routed?
To leave some just broke and the rest broken-hearted?
“WELL, things just got nicely settled down around here when we began to hear of a new thing just started. It was a great economic political movement called the Non-Political Union. It had a slogan, too. The slogan was ‘We’ll stand pat — we can’t lose,’ and they had a program. Did you ever notice that pretty near everyone of these farmer-saving organizations has a program? Their program was to make everything in the state and in the Northwest and maybe in the entire United States, state owned. They were going to drive all the mortgage companies out of the country; they were going to build great state-owned terminals and mills, and mill up all of our wheat and grind up the dockage and send it back to us, cheap. They were going to pay us more for our grain than we had ever got before and sell us our feed and flour for less. They were going to lend -money on farms at a low rate of interest and build homes for the people in the cities. The state was to take over all the banks and elevators. Well, we made a great victory. We won the election — captured every office in the state. We even elected our own men to represent us in Washington. They organized a lot of other things.
“One day a couple of fellows came along here and they called some of us interested men together and proposed that we should buy out the local bank and have a farmers’ bank. They told us that the farmer produced everything and therefore should own everything; that all the profits belonged to him and should
go to him. Do you know that it only took four days to organize that bank? We got rid of all of the men on the board of directors who knew anything about banking and elected all farmers but one. He was the promoter and we elected him President. We paid $150.00 a share for stock with a par value of $100.00 and our other $50.00 went $25.00 a share into what they called a surplus and the other $25.00 went to the promoter and he was the President. They
put in a new cashier. One day a fellow came along here with a letter from the State Banking Department introducing him. He wanted to borrow $1,000.00 from our bank to help finance a sisal plantation in Mexico. He said his sisal plantation would grow sisal cheap, sell it to the state who would make it into twine and sell twine to us farmers for half of what it was costing us under the present arrangement. With this letter from the State Banking Department we thought it was all right, so we loaned him $1,000.00 and took $2,000.00 worth of stock in that sisal company as collateral.
“Another time they came along here with a lot of post-dated checks and we loaned them another $2,000.00 — taking post-dated checks as collateral.
Then we got some personal notes from some of the men prominent in the Non-Political Union, and notes from several other different things that the leader of the Non-Political Union had organized.
“About this time we had an election and the administration was changed. One day the State Bank Examiner’s deputy came along here and closed our
bank. I was one of the directors in that bank and I had signed up bonds to guarantee the deposits of the School District. I had signed up accommodation
notes to get money for the bank and various other things. “On this $1,000.00 that we loaned the sisal company — five of us put in $200.00 apiece and took four shares of stock in payment for our $200.00. There is the stock certificate in the sisal company. Nice looking certificate, isn’t it? I have never heard of
“Things came so fast along at this time that I can’t tell which one did happen first. They organized a farmers’ store. In this every farmer put in $100.O0 for capital and for that $100.00 he was to be able to buy everything that he had to use at around 15 per cent to 20 per cent less than what anyone else sold it for. We signed up notes for our memberships and the headquarters promptly took the notes. They were to have great buying depots where everything was to be bought in carloads. I remember that organizer told me that they could buy bands for fruit jars in carlots at about 20 per cent of what the local store charged for them, and I didn’t think at that time that we only used about fifty cents worth of fruit jar bands a year.
“At any rate, we got our store started. It only was a little store, and the things that they sold weren’t standard brands. My wife didn’t like their goods and their prices were as high or higher than our local merchants. If we wanted a little credit accommodation they said they couldn’t give it to us. But every week we would get a paper urging us to be loyal to our organization. And across the top of the paper was written the slogan ‘We’ll stand pat-we
can’t lose.’ Well, the store went from bad to worse, finally closed up, and several men were held on accommodation notes for the store’s benefit. I wasn’t in on that. I guess I was on so much other accommodation paper that they figured I wouldn’t be any good at that, so they didn’t elect me. What was
left went to the receivers, lawyers and auditors and
we farmers paid the bills. And that’s what I learned about store keeping.
“It wasn’t long after this that a man came from out West telling us about what wonderful things could be accomplished if we would all club together — pool all of our grain into one big pool; control surplus and take the marketing of our product out of the hands of grain gamblers. We were to have a lot of state pools and all the state pools were to be joined together in a big national sales agency. A board of directors was to be elected consisting solely of farmers. That part of the program seems always to be alike, although I can’t see where there is any more sense to electing only farmers to run a business entirely different from farming than it would be to elect a board of school teachers to tell a man like me how to plow. Plowing and seeding; harvesting and
threshing, milking cows, raising hogs, and taking care of sheep is a business that I know and I think there are few grain men who could give me any good
pointers. I’ve learned (from bitter experience that buying and selling, and hedging and financing grain operations is a business just like farming and that
if you don’t know a lot about it you had better leave it in the hands of someone who does.
“At any rate the pool organization started and I signed up. I signed a contract to give the title to every bushel of grain grown on my farm for five years to this association. I pledged myself to do certain things: to haul the grain where they told me to haul it, to send storage tickets for the grain in to them, to take any size of an advance that they agreed to give me regardless of values; to allow them to deduct from my produce almost any amount they chose
to, to pay any kind of salaries they wanted to pay, to make almost any kind of expense they wanted
to, and that I would take what was left and say nothing.
“I didn’t read that contract over much at the time but in the long winter evenings that followed when I stayed at home because I didn’t have money to go any place with I read it over and I figured out to my self that while I’d agreed to do all the things in that contract they hadn’t agreed to do much of anything, and as a matter of fact, they didn’t. Well, I stayed two years, and in those two years I took a lot less for my grain than I could have got if I sold it myself. After two years I made a kind of lease of my farm to my hired man and I marketed my grain in his name til the contract ran out so that I wouldn’t
have to deliver it to the pool. I never figured out how much they cost me, I couldn’t just exactly, but I am sure that it was more than $1,000.00. Why,
their handling charges ran as high as 23 cents a bushel and no farmer can stand that.
“The Equitable Association had a pool, too, and I sent one carload of grain to them. I got some advance and was to get the balance when the pool was closed up. They went into a receivership before they could pay me and I got a receiver’s certificate for what I had coming out of that car. I kept that certificate for a couple of years and one day a fellow came along here organizing what he called the United Farmers. He said it was a nation-wide organization operating in almost every state in the union, that
they had about a half million members and they had
a ‘program,’ too. Yeh, they had a ‘program,’ too. Their program was to get national legislation — government assistance to take over all of the elevators
in the country. They were going to organize a company with government aid that would export our wheat and other products. All I had to do was to
trade my certificate for stock in this new farmers’ organization and just as quick as they made dividends they would distribute the dividends and I would get paid for the wheat that I had put into that old Equitable pool.
“I know I should have known better than to go into this. The same men who were organizing this association were the very men who had been at the
head of a lot of other things that we farmers put our money into and that were not successful. I have noticed that these things are usually organized and run by a set of men pretty closely associated with one another and many of the men who are doing so much talking now about saving the farmers have been talking about it for twenty years and drawing fat salaries from the farmers’ organizations. Either salaries or auditor’s fees, attorney’s fees or receiver’s fees, or something that costs the farmer money, and when one of their organizations goes broke they promptly start out with a new one.
“It does seem as though if these men were such good business men that they could make a success out of one of the many things they have started. There was that fellow who was the head of the Equitable Association. We paid him about $7,500.00 a year but after the organization went into the hands of receivers he couldn’t get a job any place and went out to live on a farm. They tell me that he isn’t even doing well on a farm.
“Howsomever, I didn’t figure the receiver’s certificate was worth much, so I traded with him. I got half as much stock as the face of my certificate and I found out afterwards that the United Farmers got paid in full for the certificate. I was depending on those dividends that I was going to get from that thing to tide me over the winter that year. We had had a pretty light crop and most of my income had gone to pay up bonds, accommodation notes and stock
notes and the unpaid bills of things that I had joined. In fact, Mister, I was just about over a barrel. I had paid so many of these things and got myself so terribly involved that I was right up against it. The mortgage company that had a mortgage on my land were pressing me to make some payment, but I just couldn’t do it. I didn’t raise much of anything up until that time except wheat, and when the wheat crop failed it looked pretty dark for me.
“One day this fellow that represented this mortgage company came out to see me. He explained that the security that they had on the land wouldn’t
be worth much if the land wasn’t farmed. He said it was much better to have an owner on the farm than a renter because the owner had more interest
and would try to improve the land. He told me that the mortgage company didn’t want the land; that their business was investment; that they wanted the
interest on their loan and the security kept up in good shape. He told me that in order to get me out from under some of the judgments against me for accommodation notes that they would foreclose on the land to clear up the title and sell it back to me, providing I would change my “methods and do some of the things they wanted me to do. They wanted me to milk cows, “grow some corn to clean up the land, raise some hogs and some sheep. In other words, not to put all my eggs in one basket. Well, we made the deal. I bought some sheep and some milk cows on time from an organization down in the cities. I bought a few brood sows.
“That winter I drove into town one day and went to the farmers’ elevator to get some coal. I couldn’t pay for it. They explained to me that they were so deeply involved financially that they could not extend any further credit to any one. I was right up against it. There was a fellow working in one of the line elevators in town that I had known a good many years; he was raised around here. After the way I had always fought those fellows I hated to do it, but I stopped in to see him and asked him if he would trust me for a load of coal. I told him ‘I had a few cows and that if anything was left out of my cream checks‘ I would pay him for the coal as soon as I could. Well, he didn’t hesitate long. He just said,
‘Sure. We don’t make much money on coal but we would like to have some of your business and we are willing to accommodate you.
“I took a load of coal home with me. It was good coal. I bought my coal from him after that, and one time when I dropped in to see him along in the summer he asked me about selling my grain. The price of grain had gone up pretty high. Wheat was worth around $1.50 a bushel. He told me that his company would enter into a contract for my wheat and rye, also barley, and guarantee me the price that grain was that day if I would agree to haul in my grain when it was threshed. He said I didn’t need to sell at all, but if I wanted to sell 1,000 bushels — or even 500 that they would take it on that basis. All I had to do was to sign a contract. Of course if the price went up I would have to deliver anyway, but if the price went down I would get the protection. The market looked pretty good to me and I sold my wheat on a basis of $1.48 for №1 Northern delivered in Minneapolis, and my rye to $1.20. I didn’t sell all
that I had but I sold about three-quarters of it. I had never patronized the line companies and I didn’t know that they did this kind of thing. By the time I got my grain threshed and was ready to haul, wheat, on account of the big crop in the Southwest, had gone down over 20 cents a bushel. But I still had the
advantage of that higher market. He explained to me that his company could protect this purchase
they made from me by selling a ‘future’ in Minneapolis and that they would not lose anything on the deal and were glad to get my business.
“I never knew before I talked to this line elevator agent that line companies never gamble with grain. When they buy a wagon load or 1,000 bushels from
someone out here, they sell it at once for future delivery. That’s why he always had to telegraph just as quick as he bought anything. This line elevator
agent explained to me that all line companies use the ‘future’ or ‘option’ market as a protection and that this protection is what allows them to do business on a small margin. He told me that his company figured they were doing well if they had a gross profit of around 6 cents a bushel on wheat and that out of the 6 cents they had to pay all of their expenses. I couldn’t help but wonder why it should cost a farmers’ company all the way from 13 to 23 cents a bushel to run a pool when a line company could handle it for 6 cents and still have some profit left, if they got a fair amount of business. The only reason I could think of was that these things that are owned and run by everybody just naturally cost lots more. He said that about 70 per cent of option trading was carried by outside people, and I couldn’t help but
think of how many of the farmers’ friends were openly speculating in the grain market. I remembered also the experience of our farmer elevator manager when he tried to speculate.
“Later on in the winter I needed some money but I didn’t want to sell all of the grain I had. My friend told me that if I would bring the grain in and take
a storage ticket his company would make me an advance on the storage ticket at a very low rate of interest and I could carry the grain until I was ready
to sell. He said that in order to get this advance I would not need to sign a marketing agreement or pay any membership fee or give the ownership of my
grain to the company. — They would hold the grain as security and the control was absolutely in my own hands. I couldn’t help but think that this was a better deal for me than the pool contract I signed a few years ago and had to slide out of to keep from going flat broke.
“My experience with my friend in the line elevator is that he doesn’t take any more dockage than any one else takes. He gives just as good grades as anyone else gives, and his weights are just as good. He pays as much or more than the farmers’ elevator and I know where I am at. I know when I take a storage ticket from that company that when I get ready to cash it my money will be there, or that if I want the wheat or other grain back, I can get it — and they
don’t ask me to join anything.”
Of wood the pagans still their gods create
And look for help to things inanimate.
Enlightened, we their ignorance decry
And hurry on to make our god — — the State!
PETE was looking for an opportunity to inject something into the conversation that would help his cause. “This is something new,” he
said, “this is backed by the government and is sure to work.”
John smiled. “It’s something new all right, that is, it has a new name but it is the same old thing dressed up and trotted out with a few new frills. It might
work,” and as an afterthought he added, “in heaven, but it will never work on this earth. There is a law of supply and demand that can’t be got around. From
the time the public first owned anything it has been definitely proven that private’ ownership is more efficient and more economical than public ownership. I’ve been in enough things to know what I am talking about. I’ve been a good joiner and I’ve been educated to cooperation.”
“But aren’t you favorable to the Farm Board and orderly marketing?” asked Pete.
“Sure, I am,” said John, “I’m strong for farm boards. I’ve got some of them now out in that new hog house —it helped me to raise the finest lot of spring pigs I’ve ever produced. I’m for a lot of ‘farm boards’ built into a modern dairy barn so that I can milk twice as many cows and have an income the year around to pay my bills. I’m for ‘farm boards’ built into a nice new house with a heating
plant and running water and electric lights.
“You show me an organization where the men who are promoting it are willing to put in their money which will assure their interests; you prove to me
that these officials who are saving us farmers are putting half of their $10,000 a year salary back into the organization — showing their belief in it. You show me that these men who propose to run our business have a sufficient amount of interest to back it with their own money, and then you prove to me that they know anything about what they are trying to do, and maybe I’ll sign up, but not today.
“I’ve signed everything that I’m ever going to sign in the way of organizations. If you get something new that isn’t a new name only, something that is sound, something that has one chance in a million to work, I might be interested. I’m for orderly marketing, that’s the reason I built that granary. I can orderly market the things which belong to me and which I have worked hard to produce, without the aid or advice of any organization. It’s too costly.
Every tax statement I get now a days has in it a provision to pay off the unpaid bonds on the things this state started. Our state mill has lost millions of dollars and it is up to me as a taxpayer to help pay for the losses.
“They investigated that public-owned mill a few years ago and they found out and I found out that the promises that they made us had not been kept. I read the report, which has never been disputed, that showed when a grain company sold wheat to the mill they were paid more for it than a farmer was paid when the shipped direct. The report showed further that they charged us fellows who built the mill more for flour than they charged the buyers in the Eastern states. It looks like they could do this because we farmers‘ were anxious to be loyal to our own organization.
“This new proposition is the same one — just a little bigger, more expensive — and will cost me more
money. I can do it cheaper and faster myself and if I make a mistake it’s my own business. The things I signed 5 years ago will be carried in the taxes that
my grandchildren pay on their farms. I’m not going to join another one and burden my great grandchildren with more taxes for something else that won’t
“But you could take a chance on this,” said Pete, “it only costs $25.00.”
“I know,” said John. “I’ve got $25.00, and I’m going to invest it in ‘farm boards’ and I’ll tell you how. I’m going to buy $25.00 worth of pure Durum seed, and I’m going to sow that Durum seed in a little patch by itself. It will make about 10 acres. I’ve got a good piece of ground all ready and if I have good luck I’ll get enough from that 10 acres this year to sow pretty near a full quarter next year. If I get a good crop and a fair price from what I raise on that quarter I’m going to make a down payment on ‘boards’ enough to build that house I was telling you about. My children are ‘growing up and pretty soon we will need more bedrooms. If we have a nice house the young folks will want to stay home on the farm. You can’t blame them much for wanting to leave when things aren’t more comfortable or modern than they are now. I want my children to live in a house on a farm that is as good as the house the men
live in who ‘farm the farmers.’ It might not work out that way, but that’s the farm boards that my $25.00 is going to go into.”
“Well,” said Pete, “it’s getting along toward evening, and I guess I’ll have to get back to town. I don’t know but what you are right, John, and in
some ways I envy you the experience you have had — you’re educated. And in some years, while you have had a lot of hardship, you are better off than
John smiled. “Why don’t you try farming a farm instead of farming a farmer? You’ll do better! Farming farms will always be a business. Farming farmers’ is about played out.”
“I guess you are right,” replied Pete, “Good Night.”