GENERAL OBSERVATIONS.

In attempting a comparison between coöperative associations of dif ferent classes and countries, a difficulty is encountered in the fact that in most cases only a part of the associations have made returns in regard to their business, while in the returns actually made there is a want of identity in respect to many of the points on which information is furnished for the different countries. A few of the main points may, however, be brought into juxtaposition for the convenience of the reader. The latest date for which returns are at hand for all the countries is the close of the year 1887. At that time Germany had 2,135 of the Schulze-Delitzsch credit unions, and probably about 800 of the Raiffeisen associations. The people's banks of Austria numbered 1,313, of which 118 were unregistered. The totals in Hungary and Italy respectively appear to be identical with the numbers making returns-at least, there is no indication to the contrary. The total number in Russia at the same date was somewhat above 900. Of the Schulze-Delitzsch unions the number which made returns for the date named was only 886, or about 41 per cent of the whole number. For Austria the number making returns as to their capital and business is estimated at 75 per cent, and 75 per cent of the 1,195 registered banks would be 896; while the numbers for Hungary, Italy, and Russia are, respectively, 488, 641, and 712. This gives a total of 3,623 that made returns for the close of 1887, exclusive of associations of the Raiffeisen and Wollemborg types.

The number of members actually returned is highest in Austria, but that is understood to include the membership of all the registered associations, and if allowance were made for the large number of the German SchulzeDelitzsch unions which did not make returns, their membership would be very much larger than that of the Austrian institutions. For Hungary no figures as to the number of members have been found. The actual figures furnished for the German societies are 456,276; for the Austrian, 513,756; for the Italian 318,979, and for the Russian 193,945— making a total of 1,482,956. A very moderate estimate for Hungary, for the unregistered societies of Austria, and for the German and Russian societies not making returns as to their membership-including among the former the Raiffeisen loan associations-would raise the aggregate membership to at least 2,250,000, and an estimate of 2,500,000 would scarcely be extravagant.

We have seen that in the German credit unions making returns about one third of the members, if we include gardeners and rural laborers, belong to the agricultural class. The proportion of agriculturists in those not making returns is probably higher, since these will naturally consist to a greater extent than the others of unions located in the smaller towns surrounded by agricultural populations; while the membership of the Raiffeisen associations is mainly agricultural, as also is that of the Russian associations; and in the Italian popular banks the rural class appears to be more largely represented than in the SchulzeDelitzsch credit unions. In view of these considerations, it is evident that considerably more than one-third of the members estimated to be embraced in all the associations must consist of farmers, gardeners, and others earning their livelihood by the cultivation of the soil. The number of this class of members can, in fact, hardly be less than 850,000, and it may not fall far short of 1,000,000.

It will be remembered that the date to which these figures refer is December 31, 1887. The paid-in capital and reserve funds, with the deposits and other borrowed capital of the institutions making returns for the same date, are given below:

In round numbers the total capital employed may be set down at $350,000,000.

It will be kept in mind that these amounts are exclusive of those of associations not reporting, which comprise about 59 per cent of the Schulze Delitzsch credit unions of Germany, 25 per cent (as estimated) of the people's banks of Austria, and probably about 200 of the rural coöperative banks of Russia; while they are also exclusive of all the figures for the Raiffeisen associations, which are too scattered and fragmentary to justify an attempt to estimate their amount.* If we consider only the associations making returns, Italy, in proportion to her population, outranks any one of the other nations in respect to the amount of capital employed by her popular banks. Russia, on the other hand, while standing quite high in the number of banks reporting, exhibits an amount of capital which, as compared with that of the German, Austrian, or Italian popular banks, is utterly insignificant. In respect to the amount of their own capital, the various classes of

The Italian associations of the Wollemborg type are also omitted, but of these there were only 18 at the close of 1887.

foreign coöperative credit associations considered in this report would probably fall short, even after making a liberal estimate for those not reporting, of an amount equal to that possessed at the same time by the so-called building societies and similar coöperative loan associations of the United States. In 1888 the number of building and loan associations in Pennsylvania was estimated at 900 and their aggregate capital at $60,000,000. The whole number of such associations in the country at the same time, including all those with a similar character and purpose by whatever name known, could hardly have been less than 3,600 ;* and if the average capital of those outside of Pennsylvania was half as large as that of the associations in that State, the total for the country would be $150,000,000 at a date not many months later than that to which the above figures for the foreign associations relate. This is nearly twice the combined amount of the paid-in capital and reserve fund of all the foreign associations making returns for the date named, as shown in the above table. It must be remembered, however, that the foreign associations exist mainly among populations whose monthly or weekly payments have to be made much smaller than those which the higher wages of American workmen enable them to afford; so that the accumulation of a given capital in Germany, Austria, or Italy, to say nothing of Russia, represents an economic effort vastly greater than that required for the accumulation of an equal sum in our own country. But a more important distinction between our own coöperative loan associations and those above considered is that the latter do business mainly with borrowed capital, whereas the former confine their operations to the lending or investment of the capital derived from the payments of their members. It will be seen from the above table that the aggregate capital employed by the foreign associations which made returns for December 31, 1887, was at that date nearly four and onehalf times as great as their own paid-in capital and reserve fund combined. That is, the capital owned by the associations themselves amounted to a little over two-ninths and that obtained by way of deposit and loan to nearly seven-ninths of the capital they had in use. It should be remembered, however, that much of the borrowed capital in their hands consisted of deposits made by their own members.

It is worthy of a passing mention here that our own coöperative loan associations of the Pennsylvania building society type can claim a decided seniority even over the Schulze-Delitzsch credit unions, the first, so far as known, of the building associations of that State having been organized in a suburb of Philadelphia as early as January, 1831. But that which gives special interest to the foreign associations, from an agricultural point of view, is the extent to which agriculture has shared in the advantages they have afforded to their members. It is possible that a study of their principles and methods of business will

*The number in existence in the United States on January 1, 1889, has been estimated at about 4,000.

furnish some suggestions that may lead to the organization of societies capable of rendering similar service to certain classes of our own agriculturists; though, of course, it is not to be expected that any one of the foreign systems will be found adapted in its entirety to American needs. Nor would any one type of association be likely to meet the diversity of American conditions. For example, institutions that would be adapted to the colored tenant cultivators of the South might not be suited to white agricultural tenants in the North and West; while such as are adapted to the last might fail to meet the requirements of the poorer class of agricultural proprietors. In any attempt to organize an association in a particular district the prevailing need, the habits, characteristics, and circumstances of the people, and in a district with a large foreign population even the nationalities most largely represented would have to be duly considered.

An advantage generally possessed by the European associations, which would be wanting in our newer settlements, is the fact that they exist in old communities comprising a comparatively fixed population. In the rural associations, especially, this advantage is conspicuous, and it is no doubt a valuable element of success, since that thorough acquaintance among the members of an association which this circumstance renders possible must do much to facilitate the selection of trustworthy officers, and to aid the latter in judging of the trustworthiness of applicants for loans. There is, however, a vast field in our own country in which a sufficiently large part of the population has all the fixity necessary for coöperative purposes.

Most of the foreign associations have had to adapt themselves to the needs of a poorer class than would be found in any considerable number among corresponding elements of our own population. And in this connection it is of interest to observe that the capacity for successful association has been found to coexist not only with deep poverty, but also with extreme illiteracy. Some of the Italian provinces in which the popular banks are especially numerous hold a very low rank educationally, as is shown by the official statistics; and Russia would undoubtedly furnish us some striking examples on the same point.

One thing which is shown by the history of these associations is the large extent to which their multiplication and prosperity are dependent on the existence of appropriate laws. In Italy, for example, popular banks existed about eighteen years before the enactment of the new commercial code of 1882, which for the first time gave them a proper legal recognition; but at the end of 1881 there were only 171 in existence, whereas during the next eight years the number rose, under the favorable influence of an improved legal status, to 692. That is, the number which came into existence in the eight years following the adoption of the new code of commerce was over three times as great as the number existing at the end of 1881 as the result of the efforts of nearly eighteen years preceding that date. And other illustrations might be cited to the same general effect.

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From this point of view the general subject of coöperative associations, and of the laws under which they have successfully operated, both at home and abroad, is worthy of the most careful study of our own State legislators, since it is in their province that the necessary legislation upon this subject must chiefly fall. And here it may be worth while to call attention to the fact that the New York law on loan associations, which contains excellent features and has even been cited as a model, is vitiated by a provision giving one vote for each share of stock, and thus placing the associations on the joint-stock rather than the coöperative basis. It is well enough to permit the share-vote system, where provided for in the constitution of a society; but the system of one vote to each member should have the equal sanction of the law, and it is the one which should be adopted by every society that is to consist mainly of small shareholders.

Another point which is very clearly exhibited in the history of the same institutions is the importance and high value of capable, upright, and energetic leadership. Schulze-Delitzsch, Herr Schenck, and Raiffeisen, in Germany; Dr. Ziller, in Austria; Vigano, Luzzatti, and Wollemborg, in Italy, and Louguinine, in Russia, not to mention many others, were all men of ability and high character; and much of the success attained by the coöperative credit associations is doubtless due to the good fortune of having such leaders and guides. Yet much has been accomplished in the same line by men of far less conspicuous positions than some of these; and they themselves were for the most part far less widely known to fame when they first identified themselves with the coöperative movement. Indeed, it is on his work as the chief promoter of this movement in Germany that the fame of Schulze-Delitzsch chiefly rests; and Luzzatti may be remembered longer as the founder of the Italian popular banks than for his incumbency of the exalted officethat of finance minister of Italy-to which his activity in connection with those useful institutions must have done much toward paving the way. In the ranks of American farmers and workingmen there is no lack of those who possess all the natural qualifications for as able and successful leadership as the most fortunate of the foreign associations have enjoyed.

When a plan is presented which, in its adaptation to the wants and circumstances of those for whom it is intended, has within it the germs of a vigorous life, the people are not slow to adopt it and improve upon it in the light of their experience; but the original formulation of such a plan is usually the work of some one individual a little in advance of his contemporaries, either in his perception of what is needed or in the energy which sets to work to supply the want. It is by no means likely that all the types of coöperative credit associations which could have found successful fields of action have as yet appeared. The Schulze-Delitzsch associations were adapted to the supply of certain definite wants, which have already been pointed out, and the success