If agriculture is to be included and labor is left out, some means must be devised for protecting agriculture from the rising costs resulting from such an inequitable arrangement. If no ceilings are to be placed upon wages, an emergency formula for agricultural prices should be devised that will be responsive to wage changes. We believe that if the present bill is to pass, it should be so amended as to provide for a board to control prices, with a chairman appointed by the President. In the nature of things, the people would have more confidence in the judgment of a well-selected board than they could possibly have in the judgment of one man. Then again, under one man rule there is the constant danger that unwise or mistaken policies, neglect, or a desire to conduct social experiments could result in irreparable damage. This danger would be lessened by the creation of a board. An emergency court of appeals should be provided, so that those who consider themselves aggrieved may appeal from the rulings and decisions of the board. The Constitution gives every man the right to his day in court and the further we get away from the Constitution during this emergency, the harder it will be to get back to it. If Congress is going to delegate to a single administrator or to a board the authority to control prices, it is highly desirable that provision be made for public hearings so that those affected may have an opportunity to present current and pertinent information. Every separate commodity is influenced by many different factors which are best known to those engaged in its production and distribution. In no important instances has Congress ever delegated legislative authority without providing for public hearings of interested parties. This is true in such cases as the Interstate Commerce Commission, the Tariff Commission, and the Federal Trade Commission. The American system of free enterprise must not be destroyed while we are attempting to devise ways and means of escaping the dangers of inflation. It must be clearly recognized that the enactment of this bill in anything like its present form will give the Executive Department of the Government the power of life and death over agriculture, industry, and business. While this is to be done to save the institutions of our democracy, let us not forget that there can be no such thing as democracy without a system of private enterprise. Senator BROWN. When you say the present bill you do not mean the bill that passed the House? Mr. BRENCKMAN. Yes, sir. Senator BROWN. Because that contains a price-control board that I understand you people wanted. Mr. BRENCKMAN. As I understand it, Senator, that contains a board of review. Senator BROWN. It pretty largely places real control in the Board of Administrative Review, composed of five members. Your point is that you want a five-man commission in the first instance to handle prices? Mr. BRENCKMAN. Yes, Senator Brown. Mr. BRENCKMAN. Yes, sir; and then there should be an emergency court of appeals back of that board. Senator Brown. I see. I just wanted to get your idea. I did not want to interrupt you. Mr. BRENCKMAN. The bill contains three methods of terminating the extraordinary delegation of legislative powers contained therein. It seems to us that a provision should be included under which Congress simply by passing a concurrent resolution could at any time recapture the powers it has delegated, if it should appear that these powers are being abused, or when the need for exercising them no longer exists. The lend-lease bill furnishes a precedent for such action. We consider this one of the most important safeguards that could be written into the bill, and it would have a sobering effect on those who would be called upon to administer the act. In conclusion, Mr. Chairman, I wish to file for the record a statement on the subject of inflation adopted at the recent annual convention of the National Grange. This is a comprehensive statement of our position on the subject. Senator BROWN. Thank you, Mr. Brenckman. Senator BANKHEAD. How many members are there in the Grange? Mr. BRENCKMAN. In round numbers, 800,000 members, distributed over 37 States. Senator BROWN. Thank you very much, Mr. Brenckman. (The document referred to and submitted by the witness is here printed in full as follows:) RESOLUTION OF THE NATIONAL GRANGE ON INFLATION ADOPTED AT SEVENTY-FIFTH ANNUAL SESSION, AT WORCESTER, MASS., NOVEMBER 13, 1941 INFLATION The right to store up the results of skill and labor in the form of property is fundamental to the preservation of the American way of life. One of the greatest dangers this country faces is from inflation, which, unless controlled, may destroy the foundations of our democracy. There are two methods of control. First is the use of economic devices designed to lessen the pressure of surplus income on inadequate supplies, Second is the arbitrary control of prices, labor, rents, commissions, etc. Among the economic devices are: 1. Encouraging savings and building individual reserves to meet the shock of post-war adjustments. 2. Increase in income taxation, coupled with efficient and economical administration of government, which will serve to retard infilation and prevent the passing of an unnecessary debt burden to future generations. 3. Encouraging investment (by individuals in preference to banks) in Government securities which finance the borrowing from which employment and excess income are derived. 4. Maximum production of all consumer goods, which can be produced without hampering production of needed defense materials. 5. Restricting credit to productive purposes and sound investments in order to discourage speculation. 6. Voluntary reduction of selling prices, when increased volume results in lower costs and increased profits. This will promote the benefits of a cycle of plenty by reducing living costs, reversing the trend of the evils leading to inflation, and laying a firm foundation for post-war adjustments. If these measures do not serve to prevent prices advancing unreasonably, it may be necessary to resort to measures of arbitrary price control. In that event, certain definite principles should be borne in mind: First, some advance in price is a natural accompaniment of the great destruction of wealth as a result of war. This advance is not inflation. It is an unavoidable cost which all must bear. Any adjustments of prices, wages, rents, or commissions which relieve any group of bearing its share of the cost will result in increasing the burden of others, and are unsound. Second, any effort to increase profits because of the increased demand is inflationary. If arbitrary control is necessary, it should be limited to profiteering. 65913-41-23 Third, if control is necessary, further than well-defined cases of profiteering, all should be subject to control, so that equity among all groups will be assured. The administration of any price control legislation should be vested in a board with a chairman appointed by the President and any authority so granted should be terminated as of a specified date. Fourth, Congress should not allow the authority to fix prices to be vested in any agency which is not constantly subject to congressional control. Congress should require prompt reports on all actions of any price control body and should retain to itself (1) the right to review and revoke by joint resolution any order issued by such agency, and (2) the right to revoke by joint resolution any powers thus granted to such agency. The unlimited right to control prices is tantamount to the right to legislate. Fifth, Congress should establish standards for the guidance of any price control agency and provide a court of appeals. The purpose should be to attain equitable income and equitable relationships between groups. No group should receive more or less than an equitable and just share of the national income. In the consideration of farm prices, farmers should not ask more nor agree to accept less than actual parity, but it is essential that a just rule be provided for determining parity. Some flexibility in administration will be necessary to assure actual parity. Three facts bearing upon agriculture's place in this problem should be kept in mind: First, not once in 20 years has agriculture's income reached parity. On the contrary, the farmer's proportionate share of the national income has declined alarmingly, and substantial increases in prices are necessary to bring farm purchasing power back to normal. Second, with farmers receiving substantially less than half of the consumer's dollar, there is no justification for passing on to the consumer any increase further than the increase received by the farmer, unless justified by some other valid cause. Third, agriculture, with its 611⁄2 million individual producing units, is the least likely of all industries to exact monopolistic prices from consumers. If farmers can get equitable prices for their products they can and will produce in abundance. If they cannot get adequate prices, exhortation to raise food to win the war and write the peace will not suffice, not because of lack of will to serve, but because of financial inability to carry on. The Grange, therefore: (1) Favors application of economic devices as the best means for holding down inflationary tendencies; (2) opposes arbitrary price fixing unless necessary; (3) if arbitrary price fixing becomes necessary, demands: (a) That all groups be included to assure equity; (b) that the activities be devoted to preventing profiteering; (c) that standards be provided, as far as possible, to assure equity for all; and (d) that Congress retain control. ✔ The Grange will oppose arbitrary price fixing if these principles are not complied with. Senator BROWN (presiding). The next gentleman to be heard is Mr. Charles Holman, representing the National Cooperative Milk Producers. STATEMENT OF CHARLES W. HOLMAN, SECRETARY, NATIONAL COOPERATIVE MILK PRODUCERS FEDERATION, WASHINGTON, D. C. Mr. HOLMAN. Mr. Chairman and gentlemen of the committee, my name is Charles W. Holman. My address for the purpose of this hearing is 1731 I Street NW., Washington, D. C. I am secretary of the National Cooperative Milk Producers Federation, which is a national organization composed of 59 cooperatively owned dairy organizations marketing the milk and other dairy products of about 265,000 farm families located in 41 States. By request in his letter of December 15, which I wish to file for the record, I am also appearing for Mr. Ed Kennedy, of the Farmers Guild, which is an organization that represents about 10 States which formerly were identified with the National Farmers Union; and with regard to an amendment which I will suggest to the committee later, I wish to file in the record a statement from Mr. Fred Marshall, secretary of the National Wool Growers Association, of Salt Lake City, endorsing the principle of the proposed amendment, and one from Mr. F. E. Mollin, secretary of the American National Live Stock Association, Denver, Colo., also endorsing the principle which I intend to discuss. Senator BROWN (presiding). They will be received and printed in the record at the conclusion of your remarks. (The statements referred to and submittted by the witness will be found printed at the conclusion of his statement.) Mr. HOLMAN. I also desire to file with the committee a list of the member organizations of our federation, together with two resolutions passed at the annual meeting of the federation in Chicago on November 12, 1941. The first is in opposition to any form of price ceiling legislation, and the second is a call for a new type of parity concept. (The documents referred to and submitted by the witness will be found printed at the conclusion of his statement.) I shall endeavor to be very brief. My purpose in appearing this morning is, first, to oppose the bill in its entirety as being inopportune and, so far as agriculture is concerned, unneeded at the present time; and I shall undertake to sustain that statement. The second purpose is to protest against the type of ceilings proposed in the House bill, No. 5990, and the third is, as a last resort, if it is the intention of this committee to report out a ceiling bill, to suggest a form of amendment which will protect the operation of the Agricultural Marketing Agreement Act of 1937 under which our own people operate, as do also a great many other commodity groups, and to protect certain other phases of existing law. Our first point with reference to the bill being unnecessary is that the buying power of this country is possibly at its all-time peakSenator BROWN (interposing). I hope you will shorten your remarks on that subject, because I think I can say that the committee is going to report out some kind of a price-control bill with authority in it to fix ceilings. Of course we will be very glad to hear you in opposition to that, but I think you should confine your remarks largely to the amendments. Mr. HOLMAN. I shall be very delighted to do so, if you will give me about 1 minute on that. For the purpose of sustaining the point that buying power is high, I desire to file for the record table III, entitled "Prices and Urban Conditions," which shows a great disparity between the prices received by farmers and wage rates received by some 20,000,000 workers in urban communities. Also table IV, entitled "Purchasing Power of United States Consumers." For example, an hour's work of a factory worker in 1919 would buy 4.6 pounds of bread, and today it will buy 10 pounds of bread, with other commodities in line. Senator BROWN. Do you not want to put tables I and II in the record? Mr. HOLMAN. Not yet. Senator BROWN. But you want to put into the record tables III and IV? Mr. HOLMAN. And also table V. Senator BROWN. You want tables III and IV at this point in your remarks? Mr. HOLMAN. Table III and table IV I am disposing of at your request in conection with the argument regarding the purchasing power, and I am asking that they be filed in the record, Senator, at this point. Senator BROWN. Very well (Tables III and IV referred to and submitted by the witness are reproduced in full as follows:) 1 Some of these are preliminary_or estimated figures. 2 November 1937. • October. |