Good old boy network makes securing a loan difficult
Thompson decided that in order to stay in the farming business, farmers needed to turn to small farms. But his plan for a small farm, though extensively researched, met resistance from lenders. The lenders were accustomed to large scale loans, and Thompson suspected that, as members of the "good old boys system," they were reluctant to lend to a newcomer.
Citing this Excerpt
Oral History Interview with Charles D. Thompson, October 15, 1990. Interview K-0810. Southern Oral History Program Collection (#4007) in the Southern Oral History Program Collection, Southern Historical Collection, Wilson Library, University of North Carolina at Chapel Hill.
Full Text of the Excerpt
I just wanted to figure out a
way for me to farm in an alternative way that would allow me to, well,
use another person's quote, actually is
also Earl Parson "get big" or
"get out." In another word, to expand or give to other
person who wanted to expand?
- JUN WANG:
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But you don't like big farm, right?
- CHARLES D. THOMPSON:
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No, I didn't. These people were get out of business. If there
is a way to make a living, is to the opposite, to get small and get in
agriculture. The difficulty was that to persuade a lender to give you
money to buy a farm on a small scales where the farm plan was to plant
vegetables and fruits. The farm plan I worked out very well, using lots
of different books. I continued to use that library. Because it moved to
Chatham county. That library is not exist in Chatham now unfortunately.
This is another story. SO I worked with those books and came out with a
pretty good farm plan. Probably, it much better than anything
I've seen. To say honestly. Because most farmers
don't go through the experience as I am through college
degree, humanity, my writing skill and all that were good. So I came up
with this farm plan was very specific in terms of how many acres of each
thing I was going to plant, I even did a marketing analysis showing that
various restaurants would buy these things and I interviewed people and
wrote down what they said. They thought they would like a farm to plant
this and that. It was really a professional business plan.
It's like writing a paper. SO I gave that to couple of banks.
Actually I talked with several bankers. But they all said, "no,
we don't do any farm loan any more. So I tried to convince
them. But farmer's Administration is
a Federal agency established to help minimum resource to beginning
farmers. And that is its historical mandate from congress to serve the
population, particularly the minority farmers. So when we started the
hotline, and this different methods to help people in the community, one
of the things we had to learn was the regulation about lenders. And the
main one we were really getting a lot of
information was called Farmers Home Administration. It's a
Federal agency. Any agency in this country that supported by taxes
should treat farmers fairly, giving them every benefit that possible.
Knowing they experienced wide spread farmer crisis since 1930s the great
depressions to 1980s, so we need understand these lenders. So we worked
hard to learn about how to make the Farmer's Administration
worked for farmers. We, I mainly, wrote a bunch of (pansolines?) so the
farmers could read about their right as a borrower. What's
the different kind of bankruptcy? Anyway, I learned a lot from this work
and I knew how to get a beginning farmer loan.
- JUN WANG:
-
Yes, you became an expert on this.
- CHARLES D. THOMPSON:
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Yes. So I used my own mouth to win a loan. I went to the local county
committee. I gave application to the county director. He takes my farm
plans and presented it to the county committee. There are three people
in the committee, but none of them was farmer. They are just big
business men. They all from Chatham. I can't remember their
names. They were partly rural but basically do business. Actually we
have worked hard to change the committee to have farmers in. And it
changed since then. Now there is a law that there should be at least two
full-time farmers in the committee. They are making loans. But there
could be other problems such as jealousy. But it is still important that
a farmer will know whether a bad harvest is due to the weather or the
guy didn't try. Anyway, I applied but they said they are not
going to give me any loan. There were two reasons: you don't
have enough experience, and you know it's hard to show you
have experience as a beginning farmer. Although I had my
grandfather's farm, work experience, degrees, but they were
still not sufficient experience. The other reason was
that my farm plan was not a typical for the area. No one
has ever done it, therefore it couldn't work. Well,
it's such a bad logic. Because what everyone else was doing
didn't work. And I appealed. I don't know if
anybody appealed before. So I appealed and I went to the district
director, appears one person, happened to be an African-American.
Perhaps a little more sympathetic to the ideas of discrimination.
Although I couldn't detect that, I just thought maybe
it's a good thing to have an African-American to understand.
He wouldn't be part of--- Do you know what I mean if I say
the good old boys system? It's a slogan in the South. The
good old boys are the powerful white guys like those own the county. And
they aren't sophisticated in the rural. They may be farmers,
or lawyers or doctors. But they tend to rule the county. It's
a network. I guess there are these guys in every country. And they
usually male. Who they know and whom they related get benefit and give
the land and once come to politic, they get their people elected. You
know this? Is this the same in China?
- JUN WANG:
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Yes, this kind of network is very popular in China
- CHARLES D. THOMPSON:
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Yea, this good old boys system keeps outsiders out, keep new ideas out.
Keep minorities out. Maintain the old style. They don't get
along with people like me. So I thought this African-American guy might
not that part of the system, so might understand me.