The news in this publi
cation is released for the
press on receipt.
THE UNIVERSITY OF NORTH CAROLINA
NEWS LETTER
Published Weekly by the
University of North Caro
lina Press for the Univer
sity Extension Division.
DECEMBER 19,1923
CHAPEL HILL, N. C.
VOL. X, NO. 7
Bdiforial 3,»iird> B. C. Branson, S. H, Hobbs, Jr., L. R. Wilaon, B. W. Kaight, D. D. Carroll, J. B.Ballftt, H. W. Odum,
Entered as aeeond-clasa matter November 14, 1914. atthePostofflceat Chapel Hill, N. C., under the act of Au^rust. Z4, 1911
FEDERAL FARM LOANS
XXIIl—SEPTEMBER DAYS IN EUROPE
After moving accidents by flood and
field, or rather after moving encoun
ters with the passport officers and cus
tom house officials of Denmark, Ger
many, and France, I am halting at
Strassburg for a few days to catch my
breath somewhat and to consider the
political significance of the things I see
in Europe in September 1923. Europe
is a witches' cauldron of fear, hate,
jealousy, suspicion, greed and ingrati
tude, and if 1923 is a less significant
year in history than 1789 was, then I
mis-read the signs of the times on this
side the Atlantic. It is unnecessary to
forewarn my readers that I may be
mistaken. I am a poor prophet in the
field of politics. I i'ecall that in all my
life I have never voted for but two
men who ever got elected to any office
whatsoever. My mind is habitually
busy with economics, the laws of which
have the fateful pull and power of grav
ity and other laws of the universe that
rule in the long run. But politics-
well, politics has to do with herd psy
chology, largely with mass hysterias.
Nineteen twenty-three may mean much
or little, or nothing more than any
other year of the new century. But I
have come to be oppressed by the
feeling that I am in Europe at a time
when disruption and dissolution are
ready to write a new chapter in human
history. I therefore set down my ex
periences, observations, and conclu
sions—for what they may chance to be
worth.
A Hurry Call
We were called out of Denmark a
month ahead of our itinerary date by
the rush of events in Germany—the
final collapse of the mark, the shutting
down of factories, the closing of stpres,
the food riots and street railway strikes
in the larger cities and industrial cen
ters, the raiding of the fields and barns
of the farmers, the ending of bank cor
respondences and the difficulty or im
possibility of getting American dollar^
from German banks on our letters of
credit and travelers' checks, the ap
proaching surrender of Germany, the
inflamed state of the German mind, the
signs of secession in the German states,
impending civil strifes and the break
ing of Bismarck’s empire into bits.
These and such-like newspaper reports
impelled us to hurry back to Castle
Engelberg to save our personal effects
in storage there.
A Lull Before the Storm?
We traveled two nights and a day
and arrived in safety on time to the
minute—on a Miteuropa sleeper from
Berlin to Stuttgart at a cost of twenty-
five cents apiece for our night's rest!
We found the state of Wurtemberg
as quiet as when we left it in early
July. But the pace of everything is
perceptibly slowed down, the crowds
in the railway station and on the side
walks are smaller, and the motor cars
and trucks are fewer than ever. There
is no longer any briskness in the gait
of the Stuttgartners. They move about
listlessly and look dazed as though in a
dream. The daytime silence of voices
and traffic in the streets is positively
funereal. Wurtemberg is in far better
case than any of the other German
states, but like all the rest Wurtem
berg is now helpless and hopeless. On
our way south we stopped a day hi
Berlin, and a more dispirited, distrait,
and distracted people I have never
seen.
It would have been infinitely better
for Germany to have squared her rep
arations account on any terms whatso
ever in 1918 or to have arranged a set
tlement in good faith on a bankable
basis. It would have been better for
France, if the Allies had followed
Foch's advice and promptly occupied
the Rhine states with standing armies
as collecting agencies settled down to
stay until Germany had surrendeted
her last pound of flesh.
The Ides of March Ahead
Instead, France and Germany have
been gambling with fate, and both
with the cards stacked against them.
The inevitable end, as I see it, is bank
ruptcy in both countries. Germany in
1914 gambled on the billions of loot she
expected to enjoy, and France during
the last five years has gambled on the
reparation billions she somehow expects
to receive. On the basis of these
two fictions', both countries sold billions
of government securities and covered
the same with unsupported printing
press currencies. The end of this folly
in public finance came first in Germany,
and a similar end is due to follow in
France—not suddenly perhaps but none
the less certainly at last. The Ides of
March are in fate’s calendar for
France, unless I am mistaken.
Issuing Rag Money
With francs fluttering around sixteen
instead of five to the dollar, France
is at this very minute offering three is
sues of six percent treasury bonds at
98.50, and these are just so many more
of such issues during the last ten years.
It is Hobson's choice. She has no other
way to meet the steadily increasing de
mands on her treasury. On Germany’s
promise to pay, B'rance has spent bil
lions in rehabilitation work in her dev
astated areas, and the billions have
been furnished by the buyers of gov
ernment securities at home and abroad.
On Germany’s delay, France has been
forced to maintain a standing army of
seven hundred and fifty thousand men,
and finally to seize upon the Ruhr as a
means of collecting the billions of gold
marks due her. A military establish
ment of this size and a venture of this
magnitude call for more billions of ex
pense money. They cannot be supplied
by a taxpaying public already heavily
over-taxed. They can be supplied only
by further issues of government bonds,
but they are bonds whose basis of se
curity steadily diminishes. Neverthe
less these bond issues are absorbed by
the French public in the fever and fer
vor of a new victory on the Rhine. The
consumption of government credit
means an inflated currency, it has
never meant anything else in any land;
and abundant cheap money means flush
times and apparent prosperity, over-
confidence and expansion in business,
wild-cat enterprises and blue-sky art
ists. More public bonds mean more of
all the fantastic things I see in France.
But the public debt must someday be
redeemed with good money and the
longer the delay the greater the cer
tainty that the franc will once more be
rag money.
Can France Get Her Dues?
France is bankrupt unless she can
have the 132 billion gold marks allotted
to her in the last verdict of the Rep
arations Commission. Her statesmen
have said so frankly and repeatedly.
And undoubtedly it is true. Her poli
cies of public finance these five years
have all been based on these billions of
gold and in the sight of God and man
she ought to have them.
But will she and, in the natural course
of events, can she have them now or
ever?
Fatal Figments of Fancy
Since April of this year I have been
living first on one side of the Rhine
and then on the other, and it is my de
liberate conclusion that France like
Germany has staked her fate on a fiction,
that her reparations gold is as certain
ly a figment of fancy as the loot that
lured the German armies on, and that
the end of public finance based on fic
tion is as certainly fatal to France as
it proved to be fatal to Germany.
Disintegrating Forces
The reparations debt can be collected
by force and by force alone. Or so I
hear it said over and over again daily.
But force in the Ruhr has meant less
coal, coke, and iron for France, less
reparations in kind and less reparations
in gold or rather none at all. Conceiv
ably Germany could pay the debt in
gold in the course of long years, if the
integrity of the republic can be pre
served and if the solvent nations of the
world can recover faith enough in Ger
man honor to underwrite her bonds.
But paying 132 billion gold marks
means a burden of paralyzing debt for
German taxpayers for long centuries
to come, and to escape this debt the Ger
man states are strongly minded to break
FARM LOAN BANKS
The proceeds of loans granted by
federal farm loan association banks
may be used for the following pur
poses only:
1. To buy land for agricultural
uses.
2. To buy equipment, fertilizers,
and livestock.
3. To provide buildings, and for the
improvement of farm land.
4. To discharge indebtedness in
curred for agricultural purposes.
away into separate distinct autonomies
—into Balkan-like communities, say.
The Ruhr occupation fanned German na
tionalism into a flame, but the Berlin sur
render—the paper surrender—the other
day set free the forces of dissolution^
“What's the use ,of holding Germany
together, when German unity means
tax-bondage to France forever?’’ This
question is in the hearts and on the lips
of the German masses. One hears it
or feels the silent force of it every
where in Germany today. Even the
dullest German is thinking of little else
at present. It may mean much or it
may mean little, for the Teuton does
not have a revolutionary temper. But
if Germany flies into pieces France has
forty-odd areas instead of one to force
with armies of occupation. If France
were equal to the task, would it pro
duce the gold she needs? Can Berlin
hold Germany together under present
conditions? I doubt it. Not social rev
olution but repeated political upheavals,
I say once more, seem to me to be in
evitable in Germany during the next
half century or so—not monarchism on
an imperial scale or not for long at a
time, and not bolshevism, but strong-
arm state governments in rapid succes
sion here and there or everywhere.
The old German empire fell to pieces-
in some such fashion, and not incon
ceivably Bismarck’s empire may go the
same way.
France’s Dilemma
But in this event, would it mean the
gold France needs in her treasury to
redeem her bonds and secure her cur
rencies? It is a need that is no whit
less imperative than her statesmen say
it is. And meantime has France the
men and the means to maintain the
pace she has set for herself and the
still greater pace in prospect? Can she
finance the conquest of central Europe
and seize loot enough to pay her debts
and redeem her printing-press money?
Meantime can French taxpayers stand
the strain, and will they? Can France
escape the further and the final debas
ing of her currency? Nearly a billion
crisp new francs went into circulation
last week. Will the necessity be less
imperious next week and the week fol
lowing and 80 onto the end? With her
new war debt unpaid, and under the
pressure of circumstances unconsid
ered, can France sell more securities in
the money markets of the world to fi
nance a policy of war? And when the
final collapse of her currency sets in,
will the French people continue to buy
French bonds and clip coupons payable
in francs of steadily dwindling value?
The French are tried and proven pa
triots. They love La Patrie as the
Danes love their Dannebrog. But they
are also thrifty, canny, temperamental
and revolutionary b]? nature. When
the franc follows the mark into the
abyss, the French people will have a
word to say about it, and they are like
ly to say it in a characteristic fashion.
France is throwing to the winds the
safety that lies in solvency. Which
ever way she turns bankruptcy stares
her in the face.
France is no longer a free agent.
She is caught fast in the fell clutch of
circumstances. She must have more
gold in her treasury or she is bankrupt.
If she cannot have her reparations
money, she must be freed from the
fean of Germany. She cannot be se
cure as long as Germany is alive. Ger
many cannot be destroyed without force,
force means war, and war can never a-
gain mean loot, but only debt, taxes,
and bankruptcy anywhere in Christen
dom.
The Logic of Force
The humor of Ftance is perfectly
understandable, but nevertheless it is
certainly fatal. The winds of fate are
whipping Europe into war, and another
war will be the death of Europe. It is
the logic of force that is writing his
tory today as heretofore in the long
story of man on the planet. And a
sorry story it has been in every age.
What good thing can come out of a
death struggle between hate and fear?
And what nation on earth can hope to
escape the consequences of another
war in Europe?
The World Involved
America? Europe is our best custom
er and Europe has ceased to pile up
trade balances in our favor. Our fariji-
ers are facing bankruptcy in conse
quence, and not all the protective tar
iffs that congress will pass can save our
manufacturers in the end. Great
Britain is grimly holding tight in the
English way in a period of desperate
^business distress. Denmark, Norway
and Sweden are suffering in trade re
lationships. And the same thing is
true of Holland and Belgium. Switzer
land has not known such stagnation
since the Napoleonic wars. Spain is
upheaved, Italy ventures to dare des
tiny with war, the Balkan states have
chips on their various little shoulders,
and forty thousand officers of the old
German army are licking seven hundred
thousand Russians into war efficiency—
for what end God alone knows!
The Way Out
And the way out cannot lie in the war
that is brewing in the witches’ cauldron
of fate. There is no way outexcept in
the peace of the Prince of Peace. His
peace message is two thousand-years
old and it is still an iridescent dream.
If it must always be so, then civiliza
tions must continue to rise, flourish,
and fall into death, one after another
until the end of time.
Which reminds me that sombody once
asked Henry Ward Beecher whether or
not Christianity wasn’t a failure. “I
cannot say,’’said he, “the world has
never yet tried it.”
I am appalled by the signs of war I
see in Europe in September 1923. I
am writing them down very much in
the humor if not with the skill of Ar
thur Young who noted the things that
fell under his eye in France in 1787.
I make no apologies for thrust
ing this letter into the series on Den
mark. The Danish letters will con
tinue until I have exhausted the mate
rials I have assembled, but the rest must
be written in France and England.
And I am writing about the signs of
approaching disaster in Europe with a
Scotchman’s grim optimism—which
meansthatitakemy pleasure sadly with
out being hopelessly depressed or unduly
exhilarated. But also by strain of
blood I am a Quaker and I hate war
and everything that breeds war. —E.
0> Branson, Paris, October 7, 1923.
OUR COUNTY JAILS
At the third meeting of the North
Carolina Club held on November 19,
Mr. W. B. Sanders gave a report on
the results of the study of prison con
ditions carried on for the past year un
der the joint auspices of the North Ca
rolina Conference for Social Service
and the State Board of Charities and
Public Welfare.
The following are a few of the facts
brought out.
1. Of the 49 county jails included in
the study only six had five or more cell
compartments meeting the require
ments of the state law. Nineteen of
the jails had only one cell compartment,
while fourteen more jails had only two
cell compartments. In the majority of
the jails, therefore, there was not ade
quate provision for separation of races
or sexes, sick and infectious prisoners
from those in good health, insane,
vicious or dangerous prisoners
from the others. In several counties
the whites and blacks were actually
confined together with no attempt at
segregation. In a certain eastern coun
ty jail out of twenty negro prisoners
given a physical examination, nine had
active cases of venereal disease, and
one was a positive tubercular, yet all
were freely associating together.
Only two counties claimed to be en
forcing the law requiring every prison
er to be examined by the court physi
cian within 48 hours after confinement
to jail. , None of the jails had a hospi
tal ward or facilities for treating sick
prisoners. Twelve jails had no mat
tresses for prisoners to sleep on. In
other jails blankets were inadequate,
in some the bedding was filthy beyond
description, and was never washed. In
thirteen of the 49 county jails there
was no provision for prisoners to take
a bath. In twenty-seven jails there
was no provision for hot water for
prisoners to bathe. In sixteen jails the
sewage system was out of order, while
three of the jails had no water works
or sewage system.
2. Of the 306 prisoners found in
these 49 county jails 41.8 percent were
white men, while 45 percent were negro
men. Over twenty percent of the pris
oners were under twenty years old
while 62.3 percent of all the prisoners
were under thirty. In regard to edu
cation 19.2 percent were totally illiter
ate. Almost half the prisoners had
never finished the first reader. The
distribution of offenses was as follows:
violation of prohibition law 31.1 per
cent, crimes against property 27.2 per
cent; crimes of violence 22.2 percent;
sex crimes 7.8 percent. The prisoners
for the most part came from the lower
economic levels of society.
Among the recommendations for
changes suggested by Mr. Sanders were
(1) the substitution of the district jail
for the county jail, (2) a State Farm
Colony for Women Offenders, (3) a
matron for women’s wards in the larger
county jails, (4) the elimination of negro
jailers, (5) abandonment of the lash
and dark cell as means of punishment
for prisoners, (6) more power for State
Board of Health and State Board of
Public Welfare to enforce existing laws
in regard to jail conditions and treat
ment of prisoners, and (7) the arousing
of public interest in the general prob
lem of social treatment of offenders a-
gainst the law.
FEDERAL FARM LOANS
The following table shows the percent of all farms in each state on which
loans have been made by both Federal Farm Loan and Joint Stock Land Banks
from date of organization to June 30, 1923.
United States average, 6 percent of all farms have received loans, the aver
age amount of each loan being $3,721.
North Carolina average, 3.7 percent of all farms have received loans, the
average of each loan being only $2,516.
In North Carolina 9,978 farm loans have been granted by both types of
banks, distributed as follows: 7,434 loans by federal farm loan association
banks totaling$15,031,150, averaging $2,022 each; 2,544 loans by joint stock
land banks totaling $10,076,600, or an average loan of $3,962. Total loans by
both types of banks amount to $25,107,650, or only 2 percent of the value of all
farm property in the state. Our farmers should make more liberal use of the
Federal Farm Loan system, especially of the Association, or farmer-owned,
banks.
S. H. Hobbs, Jr.
Department or Rural Social Economics, University of North Carolina
Rank State
Average Farms
loan borrowing,
both percent
banks
Rank State Average Farms
loan borrowing,
both percent
banks
1
Utah
....$3,255
17.6
25
Virginia
$2,948
4.1
2
Idaho
.... 3,678
16.5
25
Connecticut
3,216
4.1
2
Washington .
.... 2,816
15.5
27
North Carolina...
2,516
3.7
4
Wyoming....
.... 3,629
14.1
28
West Virginia ,..
2,576
3.6
5
New Mexico.
.... 1,946
14.0
29
Massachusetts...
2,718
3.5
6
Oregon
4,004
13.1
30
Missouri ^
4,496
3.4
7
Montana
2,923
12.3
31
Oklahoma
3.019
3.3
8
Arizona
.... 4,411
12.2
32
Illinois
6,604
3.2
9
North Dakota
.... 3,928
12.0
32
South Carolina...
3,844
3.2
10
Colorado ....
2,644
10.5
34
Wisconsin
3,732
3.1
11
Texas
.... 3,536
7.6
34
Maine ,..
2,731
3.1
12
South Dakota
5,389
6.7
36
Michigan
2,481
3.0
13
Nebraska....
6,059
6.6
37
Tennessee
2,813
2.9
14
Kansas
.... 4,898
6.4
38
Kentucky
4,087
2.5
15
Mississippi...
1,891
6.3
39
Vermont
2,679
2.4
16
Minnesota. ,.
.... 6,668
6/1
39
New Jersey
3,871
2.4
17
Nevada
4,621
6.9
41
Georgia
2,466
2.3
18
California ...
.... 4,642
5.8
42
Rhode Island
2,994
2.2
1^-
Arkansas....
2,081
5.8
43
Ohio
4,688
2.1
20
Florida
1,808
6.6
44
New York
3,464
1.9
21
Indiana
.... 4,487
5.5
45
Maryland
3,774
1.4
22
Louisiana....
2,017
6.3
46
New Hampshire..
2,667
1.2
23
Iowa
9,769
6.2
47
Pennsylvania
2,819
1.1
24
Alabama....
...., 1,928
4.7
48
Delaware
3,195
0.6