as nearly a coöperative institution as possible. He got the directors to agree with him that no more than $500 worth of stock should be sold to any individual, and he got the stockholders to agree not to sell to one another without first giving the bank an opportunity to find a purchaser who was not already a holder of shares. Thus, by a 'gentlemen's agreement," he put into effect one of the cardinal principles of true coöperation, namely: the limitation of the interest of any individual shareholder in the coöperative venture. And after he had distributed the $36,000 of bank stock among 76 farmers and farmers' wives, they elected Jim Caldwell president.

The coöperative idea in banking, so far as it could be carried out under existing laws, has been a success in Lakefield. The "motto" of the First National, prominently displayed on its stationery and advertising matter, is:

Everybody's bank-owned by no clique caters to no class - seeks only the legitimate banking business of all honest men in this community.

And it lives up to that declaration of principles and to its announcement, familiar to everyone in Jackson County:

This bank is not and cannot be used to serve private interest. No one man owns more than ten shares of its capital stock. It is owned by many stockholders scattered through the entire community, and to serve the entire community is its unvarying policy.

So far as the banking laws will let him. go, Jim Caldwell has introduced new banking methods and ideas into Jackson County - the principal new idea being that any honest man who is able and willing to pay his debts is as much entitled to credit at the bank as he is at the store or at the blacksmith's shop, regardless of whether he votes the same party ticket as the bank president does, deals at the vice-president's harness shop, or buys coal from the chairman of the loan committee. And that the farmers and villagers of Lakefield appreciate this kind of banking and have confidence in it, and in Jim Caldwell, is proved by the figures that show an increase of nearly $200,000 in deposits above the $195,000 which the First National Bank had when the new policy was put into operation.

By the time he had got this innovation in rural banking well under way, Jim Caldwell had given up the idea of going to South Dakota. Lakefield had adopted

him were quickly dropped. The other and larger store proved to be worth, conservatively, about $13,000 for stock, good will, and fixtures. One hundred and thirty-one farmers and village residents agreed to buy shares at $100 apiece in the new company and to do their trading therefore at the coöperative store. Then the question of financing a purchase for which the purchasers were unable to put up the cash arose. up the cash arose. Every subscriber was good for many times the amount of his subscription, but, as with most farmers, $100 in immediate cash meant a real strain until the season's crops were marketed, and this was in the spring of 1908. Cash

people of Lakefield were becoming used to the coöperative idea. Conditions were ripe to start something else in the coöperative line. The Right Relationship League, of Minneapolis, whose activities in organizing coöperative stores throughout the Northwest I have described in a previous article in the WORLD'S WORK, had proved its mastery of the basic principles that are essential to successful coöperative merchandizing, and Lakefield offered an inviting field for its operations. There were two general stores in town. The proprietors of both offered to sell out. One of them put a highly inflated value on all his stock in trade, and negotiations with

was needed with which to pay for the store property and to provide working capital, and Jim Caldwell agreed to provide it.

"You take these farmers' notes to run a year, or longer if they want them to run longer, and let the new company endorse them," he said. "Then bring them in to me and I'll see that you get the money."

To the ordinary student of economics it would seem that no bank would ever hesitate to lend money on that kind of security. The farmer's unendorsed note is good at any bank almost everywhere except in the United States, and the farmer's note endorsed by a company composed of his fellow-farmers is, on the face

dividends $189. In 1911 a year of almost total crop failures in Jackson County Mr. Smalley's dividend on purchases was $66.91. In all he has saved, through the coöperative store and his ownership of stock, to January 8, 1912, $372. If he had not been a stockholder his dividends on an equal amount of purchases would have been half of that amount. Jim Caldwell has saved $246 in dividends; Miss Mary Flinn, $263; Mrs. A. Vancura, $343-eighteen stockholders got back between them $4,193 in

about coöperation, than to start a cooperative creamery? That is what they did, with Jim Caldwell at the head. It was organized in July, 1911, on the basis of one share to a cow, with 1,700 shares divided among 118 stockholders. In the first six months it did $10,000 worth of business and in the second six months $14,000 worth, shipping its butter to Philadelphia, where it sold at half a cent a pound above the current New York City | quotations for the best creamery butter, bringing an average of 28 cents a pound,

the profits of which, divided among the shareholders, have yielded them a 6 per cent. dividend on their investment above the price received for their cream.

If nothing more than dollars and cents were involved in the coöperative movement as practised in Lakefield it would still be a great thing for the town. But the coöperators and that means almost everybody have accuired the habit of getting together, and once you get people into the habit of getting together they forget their neighborhood difficulties, forget the petty jealousies and meannesses that have kept them apart, rub off the sharp angles caused by isolation, and find many new things that they can do in common for the common good. And that is just what has happened, and is happening, in Lakefield.

I was in Lakefield on June 20, 1912, the day of the coöperators' picnic. There wasn't hitch room left for another horse anywhere in town by nine o'clock in the morning. Farmers and their families drove in from points as far as twenty miles away, to take part in the festivities and to renew acquaintances with their neighbors for all coöperators are neighbors in Jackson County. There were thirty or forty automobiles, many of them owned by the farmers. More than half

the houses in Lakefield closed up for the day while the whole family went to the picnic. A parade of automobiles, bearing banners inscribed with the facts and figures about the coöperative enterprises of the town and headed by the village band, led the way to the park. There speeches were made from the band-stand, to which a couple of thousand people listened. Then luncheon from the well-filled baskets, then a "tug-of-war," then everyone went down to the ball grounds and saw the Lakefield coöperative "nine" wipe up the ground with the non-coöperative baseball players of the village of Jackson. And everybody went home that night with a good deal more of the neighborly spirit and a host of new friends.

There are still a lot of coöperative things to be done in Lakefield, but not nearly so many are undone as there are in most other American communities. Jim Caldwell has a few things in the coöperative line still up his sleeve. He is going to Europe next May as one of the Minnesota delegates to investigate at first hand the agricultural credit systems of Germany, France, and Italy, and it is a safe bet that one of the first places in America where the prototype of the Raiffeisen banks will be started will be Lakefield, Minn.