WAIKATO FARMERS' CLUB.

Waikato Argus, Volume IV, Issue 232, 8 January 1898, Page 4

WAIKATO FARMERS' CLUB.

Thk following was Mr Morgan's paper read at the last meeting of tho Waikato Farmers' Club, held on the 3rd inst.: — Most of you have no doubt lead the history of the early co operative move ment, where three or four Rochdale weavers, finding that the local shopkeepers were retailing goods at a great advance on cost price, decided on trying ! to do without the middleman altogether. With this end in view they pooled the whole of their cash, which amounted to romc fifty shilling*, and invested the amount in a sack of flour purchased from the local miller. As it is now tome years since 1 have read anything about the subject, 1 am unable to siy whether or not they had any cash left for other goods, but at anyratc, they retailed the flour to themselves and their neighbours at a slight advance on cost price, and as they lcoked aftc ; r their store in the evetrng only, after work, the whole of the difference between buying ami selling price was clear profit. From this small ttart the movement grew, until now the annual turnover of distributing co operative societies amounts to many millions of pounds. In almost every case where societies have been started, and conducted on a cash basis, success has been the result ; but very seldom have wc seen anything but failures where credit has been given. From a consumer's Btand point co operation must succeed, if conducted lightly it should be apparent to everybody that where a dozen •email shopkeepers do the trade that one siforc could eudly do, prices must be high to enable each one to live. Or in other words, if say, a shopkeeper has a trade of £2O only per week, £5 of that must be profit to cnab'e him to live, and pay his rent and the expenses of hi 3 busi ness. The same man could, however, turn over £IOO per week, while his expenses need be vciy little more than when his trade was £2O only. In one ease, however, his profits must be 25 per cent., while in the other a 5 per cent. profit would give him almost the same income. Thus the whole secret of cooperation, from a consumer's prdnt of view, is a large turnover at a minimum cost, and when a great number of consumers band together this is assured. At one time it seemed to me that the producers and consumer's interests were ltlentical, and their one object should be the extermination of the middle man. It appeared to me that the enormou3 difference between the amount paid to producer*, and that which consumers were called on to pay, was quite unnccesnary, and that it would be to the mutual advantage of buyer and seller to deal directly with one another. Since then, however, I have modified my views considerably, and the more one studies the problem the more convinced one must become, that, so far from the producers and consumers' interests being identical, they arc the reverse, as one party is trying to get as much as he can for his productions, while the others' chief entleavoui is to get them as_ cheap as possible. Everyone must admit that it is to the consumer's advantage to deal direct with the producer, as he always takes good care to buy at wholesale price, even though he takes a retail quantity only, but it is questionable where the advantage to the producer comes in, as the mitldle man will give as much as the consumer. Consumers hive proved beyond doubt that co operation can be a success so far as they are concerned ; but producers, as producers pure and fimple, have never tried it. It is true that several successful farmers' co-operative societies are in existence, but I Bubmit that they are distributing trading companies only, acting as farmers' agents, and as a large number of shareholders are directly interested in their welfare, they have some advantage over private firms. At the same time it is my opinion that a private firm with equal capital and turnover should be able to handle and ssll goods cheaper than a company where all the officers ore paid salaries, for it seems to me that with cental men at the head of affairs the man who stands to gain or lose everything will manage his business more ecocemiioally than the person who is interested to the extent of his salary and possibly a bonus only. The danger, however, of a large business in private hands is that the proprietor having obtained control of the trade will no longer be content with the Email profits on which he has previously worked. Farmers are large consumers as well as being producers, and I cousider that so long as distributers have a turnover which keeps them fully employed they should Lc able to sell as cheaply as any co-operative society doing equal business. There is nn oft-quoted saying that " competition is tho life of trade," but, like every other good thing, too much of ic is death to cither the trader or the consumer, generally both. In preparing this paper I had other ends in view than to give a sketch of what co-operation has done for consumers. I would like you for a moment to take a glimpse at what combiuatiou has done for the working classes or wageearners. Some years ago, before trades unions were in vogue, un ordinary tradesman worked on an average twelve hours per day and received in return about sixpence au hour. Now the same man works less than eight hours per day and receives at least one shilling per hour in wacos, or quite double what he was paid for hia time before combination. I have no figures before me to show what trades unionism has elemc fur its members, lut, taking the English-speaking countr'es as en example, it musx have made a difference of a great many millions sterling per annum in their earnings for the same amount of work. Wc now get to the query as to who pays all these millions of ptnnds ? Certainly the manufacturer does not, as his profits are just as large now as ever. The consumer pays a fair proportion of the cxtia cost, but the producer of the raw material has to take less for his products to make up the balance of these mrliona each year. Now, the farmer is the chief consumer of manufactured goods. All merchants admit this, and as he is also the proeluccr of the raw material in most cases, it follows that the greater part of these millions of increased pay to w agc-eai nci s have been taken from the farmer's pocket. This p:occss has been going on for years, and I venture to 'ay that row not one farmer out of a hundred really makes a profit out of his farming ; and us for iuterest on the capital sunk in his farm and stock, it is to long since he receiveel any that he has forgotten that he is entitled to it. Any merchant or uanuficturcr with a few thousands of pounds capital in his business makes a first charge of a fair interest on the amount therein invested ; he n xt makes a charge of say i'2sopcr year for his own salary for conducting the same. If, at his year'y balance, he finds that his business has paid neither interest nor salary, the merchant or manufacturer, as the case may be, cotisidci-3 lightly that he has made a loss on the year's transact ions. He does not consider he lias made a pn lit until he has a surplus above all interest and other charge?. In the farmer's case we have a totally different state of affiirs. In our case, as I said before, we have forgotten that wc are entitled to interest on our capital, and as for salary for our sen ices we never heard of such a thing, although our occupation requires quite as much intelligence and a great deal more labour than The merchant's or manufacturer's business. We have a hazy idea of profit and loss, but in nearly every case the profit we make on one thing is more than Bwallowed up by the loss on another. I have had it painfully impressed upen me for a long time that everything we produce is so'd under actual cost. _ Take as an instance a case where a grazier buys a four-year-old steer for, eay £3 10s. He, in his turn, f ittems tho beast and eel's it for £6. Now, does the grazie r make £2 lOi out cf that bullock? I Bay, No!

lie makes it out of the poor wre'oh who reared the animal. No country in the world c.tn produce a well-bred grown steer for £3 or £i. They may apparently do so for a time by forgetting to allow tor profit and loss ; but wait till J the Queensland tick or some other p'ngne comes along. Then where are tiny '! I have heard reputed intelligent graz : ers in this district who, on finding they had fattened cattle at a loss, have blamed themselves for giving too much for their store stock in the list instance. They never stopped to consider whether the first man got paid for his grass or not. Some ye us ago an eminent man declared that the farmers were the backbone of the world, and like most other sons of the soil I was delighted to think that such was the case. It cow seem? to me that we are nothing else but backbone. We find the bone and sinew, while we allow others, who use their brains, to work us for a'l wc are worth. I am not going to touch on the long hours fanners are compelled to work, as everyone following the occupation knows all about that; but I would like to draw a comparison between the expenditure on pleasure of the average farmer and the ordinary city tradesman or workman. I bel eve I am within the mark when I say that the city man flitters away more time and money on pleasure in a week than the farmer does in a year ; and if it had not been for the rigid economy practised by the farming community for years past-, half of us must have cone to the wall. This applies to tie farmers in almost every English speaking country. I have heard people quote the fallacy " that supply and demand regular prices," 3iul it is no use trying to fight against that rule. But this is not so, as for the whole of our chief products supply and demand is fictitious, and, in all the markets of the world, the prices are ruled by a few wealthy combinations and speculators. It is quite true that continued over-production of any perishable article must demoralize prices, but as a rule speculators make more out cf a shortage than the producer does. Many farmers believe that they can do nothing but wait for better times and that pi ices must re-adjust themselves in the long run, and eo each of us troes on produc : ng at a loss, with the hope that our neighbours may get tired out or bankrupt before we do. We have been hoping against hope for so long that now most of us imagine it is our fate to be ground down to the dust. There is a good eld saying that "God helps those who help themselves," and I would impress on all armors in this colony, and, for that matter, the world over, that it is only necessary for us to combine in order to put prices to whatever point we like. Now, what I would impress on every farmer in this co'ony, i«, that if il is possible for trades' unions to put up the price of labour, how much more simple it is for the producers of the food supply to combine and put up prices to a paying level. In one case there is a danger of a lock out, which sometimes lasts until the unionists are starved into subjection, but in our case the consumers must give us the price we ask or starve. I should not like anyone to rnn away with the idea that I advocate an arbitrary use of our power to squeeze the last shilling out of consume!s. All I ask is a fair living price for producers and to " live and let live." In propounding a scheme for the co-operation or combination of all producers, I have not shut my eyes to the many conflicting interests to be overcome. New Zealand has been said to be admirably adapted to lead tha world in labour unionism and legislation and for the 3ime reasons it is suitable fur farmers' combination. It is no use for a few persons in one loca'ity to pre tend that they can effect prices for any length of time, as, unless they have an immense sum of money at command to buy tip the bulk of produce, they cannot control the uieukor. In our case it would be next to impossible to raise a large sum of cash, as the majority of farmers have been bitten once before with shim schemes cf so-called co-operation.. For a consumer's cooperative distributing society to be a success a large sum of cash is essential, but we a:c now looking at things as producers only. In these days of twice thy farmers and empty pockets it wousd be necessary for an absolutely popular scheme to require no money at all, and that is practically what I propose. We want no cash to buy up produce, as we hold the whole of the productions already, and all wc want is for producers from end to end of this colony to combine. If the price of all food was doubled at a day's notice it would not affect the quantity consumed, so there need be no fear of a long »icge. To make try scheme practicable it will be nccessaty for the formation of The New Zealand Farmers' Union to comprise all the producers from end to end of the colony. In each producing district, like Waika'.o for instance, members should elect a district committee, which in turn would appoint a delegate from among its own members, to attenel at Auckland, for instance, and meet elelcgates from other districts, say, ence a year, to review and regulate prices. These delegates, in their tutu, would elect a person to represent districts, et a council composed of members chosen from each of the distributing centres, which would be the cities. Thus, wc would have district advisory committees, delegates from same to meet in distributing centres, ami a chief council, which need meet in cases of emergency only. Now would come the great problem : How to regulate prices? To begin with, there would have to be separate depots for ordinary produce, fruit, live stcck, etc. To explain moie fully, we will take fruit as an instance. This is a pciishab'c prtielc, and we nil know how it varies in quality. It would be, therefoio, necessary to class it into several grades In fixing p:ices for the d:ff rent grades, wo should have to consider the large-quantity of fruit imported into our cities, and although I would fix the pr ce es high as possible, it should be necessarily kept below the price at which it con d be imported from other parts. When there is a short supply of trust there is no diiriculty in getting extreme prices for it, but when the full crop is put on the market the supp'y is often twice as great as the demand. Th's, in consequence of all the producers competing against each other, causes fruit to be sold at about the cost of picking, so that the crehardists practically get no profic at all. l>y all fruitgrowers combining and sending their fruit to one depot where their goo.ls would be graded ami a fixer! price put en each grade, all distributors or frui'eters would attend and, in the case of a glut, buy perhaps half the to'al consignments at possibly more than the whole would have brought if forced on the market in the present way, Now we have the surplus to deal with. It practically stands us at nothing, and, in comparison with our present t-ystcm, it would pay us to throw it into the s-:a. There are jam makers, however, who will always cive a fair price and there is also occasionally an export market. If j tin-maker* decline to give a fair v-duc, fruitgrowers could easily form ii j m factory on their own account. Tiny would th n not only control the fruit, but also the jam market. Of course to do all thi3 a pool would he coinpu'sory. All fruit on entering the depot would be classed and weighed ; and, if the demand was er|ual to the supply, the growers would get, say threepence per pound for the whole of their truit ; but, if only half were sold to distributors and the other half were sold to jam makers, at say a penny half penny per pound, the growers would averace two pence farlhiug only. Wc will now tike shf.ep and cattle a 3 an example. In Ibis instance the stock on arrival at the depot should be graded and weighed. As in the case of fruit, the stcck should be pooled. Ihe butchers would then take what they required, and in the case of an over supply, the sur- ,

plus should bo either held over or | slaughtered and exported. If care were taken that nothing but first quality was set aside for export, we would have n uniform aitic'e with one consignee. This would assure a higher price for our exported meat and a great saving of freight and freezing charges. If this could he brought about it would, according to best authorities, make a wonderful difference to the price of our frozen meat in Europe, and if we received say 25s per hundred pounds for the live stock consumed in the colony, it cannot be doubted but that our net returns would be largely increased. In the cafe of wheat we would have to fix the price at an importing standard, which, for the srkc of argument, we will put at four shillings per bu he'. In this case the exporting price would he about three shillings per bushel, or twenty five per cent, less than what it could be imported for. Now, say in a year, when our production of wheat amounted to 6,000,000 bushels and our consumption was only 5,000,000 bushels, there would be a surplus for export of one million bushels. If we sold till our wheat used for local consumption for four shillings per bushel instead of three shillings, which wc would receive on an exporting I a-in, the surplus would stand growers at nothing and we would have £lCO,OoOand one million bushels of wheat to the good. I think I have said sufficient to convince all farmers that we must have a change from our present system, and unless wc bring it about soon wc will be greater slaves than ever, as almost eve-y trade and profession has a union or ring. " United we stand, divided we fall," is one uf the truest proverbs ever written, and although I confess to being a free trader, yet when every other class is pro'ected we have no alternative but to protect on;selves a'so. Uniouism is a more efficient form ol protection than any Customs tariff ever devised, and 1 reiterate that the faimer ha v in2 held alorf from any form of combination has been plundered by all who have had the acumen to 1 and themselves together for the promotion of their particular trade in ten sis. At the conclusion of the reading of the paper, the President, Mr Oillett, moved a hearty vote of thanks to Mr Morgan. The paper told of many of the farmers' grievances, but he was not sure that the remedies it suggested would work well; however, it was a subject of the utmost importance to the farming community, and the paper appearing in the Tress would start the ventilation of the matter in the district, which might result in much good. The vice President (Mr Allen) seconded the motion.

Mr Gane would have liked Mr Morgan to have gone a little further and have explained upon what lines the farmers could combine, but perhaps he would do so at a future meeting. He (Mr Cane) was afraid if the prices were fixed once a year they would soon have other countties flooding them with produce, as soon as the prices had been fixed. Mr Morgan explained that he did not mean that the prices should remain the same for a year, they might be altered monthly, but a general meeting of those who fixed the prices should be held year'y. Mr Forrest thought the consumers should be cons'dered even more than the producers. He did not believe the farmers would evsr combine ; they had an instance of it that evening over the discussion re the bank charges. The only way for co-operation to succeed was to have the best manager obtainable; directors were no good, they had been tried and had faded.

Mr Graham complimented Mr Morgan upon the paper. He said co-operation meant fair trade, which was not understood. Lord Rosebery recommended the farmers to co-operate. Personally he was against combination, but in favour of co-operation.

The tuition was carr'ed by acclama ticu.

Mr Morgan briefly thanked the Club for the kuul way in which it had received his paper. His object was to co» operate the producers and not the consumers, and he was convinced it was practt:able. He failed to see why the farmers should fctudy the interests of the consumers, wdio were quite able to take care of themselves. He intimated that after the matter had been ventilated through the Piess he should be pleased to go further into the matter.