The Daily News MONDAY, OCTOBER 31, 1921. AN AGRICULTURAL BANK.

Taranaki Daily News, 31 October 1921, Page 4

The Daily News MONDAY, OCTOBER 31, 1921. AN AGRICULTURAL BANK.

In expounding his views upon the subject of financing farmers rerecently to a Press reporter, Mr. W. Stuart Wilson ’asserted that the whole country’s welfare and progress depended on the estab lishment of an agricultural bank. In support of his contention that members of Parliament should at once pass legislation for the establishment of an institution that would finance farmers and assist in fighting inimical trust organisations. Mr. Wilson pointed to the success of the agrarian banking system in Denmark as an illustration of what could be accomplished. There is nothing new in this deman ' -»r a b ink to further the interests of <••<- producers, except its limitation to farmers. The desirability of creating a financial in stitution with the object of •assisting producers so as to stimulate greater production and to assist trade, commerce and industry in order to not only increase the volume of business, but also to more fully develop the resources of the country, has, during the last few years, been strongly advocated through and by the Press, as well as by those directly interested. To some extent it approaches the principle of bank, yet, while the Government should have an interest in such a financing organisation, its primary object would be different from ordinary banking, inasmuch as its chief function would be stimulative and developmental, and security for advances would be on a different footing to that customary with existing banks. It Is unfortunate that Mr. Wilson should have marred an otherwise attractive scheme by confining it to the business of financing farmers, yet making not only all producers, but all business firms directly interested, contribute to the capital by compulsion. If, as he claimed —and rightly so —that the welfare of the whole country depends on the establishment of an agrarian bank, that should be sufficient inducement to attract subscribers from all classes, especially if interest on current accounts were paid. No greater error of tactics could be committed than to compel any section or sections of the community to contribute towards the capital. It is all very well to nominally restrict the operation of compulsion to those “directly interested.” Where is the line to be drawn, when it is claimed that the •whole country is interested? To be a success, the State should not only contribute to the capital, but should extend to it the privilege of note issue and put through it work such as advances to settlers and workers, etc. No one who has studied this matter can doubt that it would be a great boon to the community generally. Both Denmark and Germany have demonstrated what a powerful lever such banks are for producers, traders and industrialists. It is the business of the joint stock banks to make profits—the larger the better —but though a development bank would paturally earn a reasonable profit for the shareholders, its main object would be to put its customers in the way of 1 earning profits for themselves. The present time, perhaps, is not ripe for practical steps to be taken to establish such a bank, but later on, when conditions are more propitious, a scheme could be formulated and placed before Parliament, and, if alive to their best interests, both traders and producers would back it up solidly.