Imagini ale paginilor
PDF
ePub

in 1909-14. At that time he had no expensive equipment to buy. According to the records, at that time 70 percent of his farm was land, and now only 45 percent of it is land. Now out of his gross purchasing power he has to buy all this equipment and all this expensive fertilizer, insecticides, and so forth. So if you gave him 100 percent of his gross purchasing power he had then, he is far from being on a comparative basis due to the fact that farming has become a commercial operation.

Mr. BENSON. I would like Mr. Wells to comment on that.

Mr. WELLS. We never explain parity as a cost of production. It is a purchasing-power concept and on the

Mr. WHITTEN. And gross income.

Mr. WELLS. It does attempt to give the sales value of farm commodities which will yield the same per unit purchasing power.

Mr. WHITTEN. The same purchasing power. Out of his purchasing power he has to buy all these things for his farm which he did not need back then. It makes for a completely different story from that which is commonly believed.

COMPARISON OF PRICE SUPPORT COSTS WITH SUBSIDIES AND

EMERGENCY INVESTMENT

Furthermore, this surplus that you ask the farmer to grow, has pushed down the price that he gets for the rest of the crop. I cannot see that any apology needs to be made whatsoever for the cost to the Federal Government of present farm programs, when you compare it with other Federal expenditures to meet the emergency conditions. with which we have lived for the last 12 or 14 years.

Mr. Chairman, I would like to request that a statement be placed in the record at this point showing actual losses since 1933 under the price-support program as compared with costs to the Federal Treasury for consumers' subsidies, business reconversion payments, and tax amortization, and similar subsidies. Such a statement should also show the Federal investment in military materiel as a reserve to meet the present emergency as compared with the dollar investment of the Government in food and fiber acquired under the price-support program, which is a reserve for emergencies also.

(The information follows:)

1. Losses under price-support program:

Basics (profit) _

Nonbasics..

Total (net)----

2. Federal expenditures for—

Consumer subsidies (losses) –

Business reconversion payments (including tax amor-
tization).

Subsidies to maritime organizations_
Subsidies to airlines__

[blocks in formation]

Since 1951; prior year figures not available.

-$13, 011, 290 1, 077, 628, 515 11, 064, 617, 225

2 4, 204, 268, 768 340, 787, 864, 000 4 106, 000, 000 5 218, 716, 000 45, 316, 848, 768

* 129, 000, 000, 000

7 1, 118, 316, 908

Deliveries of military equipment and construction since Korea totaled $48 billion as of Dec. 31, 1952. There are still in the pipeline $81 billion of goods on order for which funds are available. (Source: 8th Quarterly Report of Director of Defense Mobilization.)

As of Dec. 31, 1952 (values of commodities under price support loan not included).

COST OF SUPPORT PROGRAM

Mr. ANDERSEN. Mr. Whitten, if you will let me interject at this point. I want to call to your attention the fact which is well known, and I am sure the Secretary knows it, that since 1933 the entire net cost of the price-support program to the taxpayers of America is approximately $1,100,000,000. That is, if you do not charge against it the so-called wheat agreement, nor the so-called consumer subsidies during World War II, which had nothing to do with improving the price level to the farmer.

The report of the outgoing Secretary, Mr. Brannan, shows that the price-support program averaged $56 million a year in cost to the taxpayers since 1933. Now, I do not think, if those figures are correct, that that is anything to be alarmed about. I think we could justifiably spend three or four hundred million dollars a year in this subcommittee to keep agriculture up to the point where it is prosperous. But I agree with you, Mr. Secretary, that we must devise means to carry out this program without waste of food. After all, the people of America will turn thumbs down on any farm-support program that means wastage in food. We saw that in the potato program. Mr. Whitten, will you continue?

COMPETITIVE POSITIONS OF AGRICULTURE

Mr. WHITTEN. I appreciate your remarks, Mr. Chairman. I want to say this, too, Mr. Benson. Every year I served as chairman of this subcommittee we had the Department investigated by special investigators. It was our purpose then, and it is our purpose now to save money. This committee, at my request had the Commodity Credit Corporation investigated, and many of the findings reported in the papers are based on the work of this committee. We were interested then and we are interested now in trying to improve the Department. But I want to point out one other thing here: We have been in the thick of the fight for years trying to keep a proper balance in this country because this is a highly competitive situation. My theory of this is that we have a people, we have land, and we have a Government, and from the start there has been competition as to how the laws were going to be written. And industry has been able to write those laws for many years. We had tariffs-check them back-before 1800.

From about 1910 we began to have legislation protecting labor written into the law. I am not trying to take those things away, although I think that in many places changes might be made there. But somebody has said that the farmer has had a free and open market. He has and he did for 150 years. For that period American agriculture did sell at the market place for what it could get and what it got was so low that the farmers depleted 40 percent of the fertile land in this country, and we haven't got that land. Also, 80 percent of our timber is gone. We in this country must see that the farmer gets a fair enough price to be able to put back in his soil a fair share of what he takes out to prevent further depletion of our resources.

How can

we say that he and he alone out of his part of the national income dollar should be the only one that puts anything back in the land for all of us?

For many years we did leave it up to the farmer to be the sole one to put a share of his income back and I cannot see why it is so wrong for all of us to make some contribution to what goes back into maintaining and protecting the soil, our very means of livelihood. Whether it be right or wrong, we had better do it in self-defense where the farmer is not doing it. And in many sections of this country they have not been.

I do hope that we can be of help to you. This subcommittee has been interested in agriculture as such and I assure you that will continue to be my purpose. I will stress the viewpoints I have as strongly as I know how but they will be put on a business basis, not as a matter of personal difference at all. We wish you the very best success and hope in your deliberations you will consider the overall problem.

Mr. BENSON. Thank you very kindly, Mr. Congressman. I am sure that I have the same interest as you have when it comes to giving protection to our land resources, the matter of conservation, and protection to the farmer. I have no other thought in mind than the welfare of agriculture and the welfare of this country.

Mr. WHITTEN. Mr. Secretary, when I came here, a Congressman who had been here 30 years said there was never a new Secretary of Agriculture that ended up representing the farmer.

Mr. BENSON. Is that a prediction, or

Mr. WHITTEN. It is no admonition, but he told me that they either get interested in politics, or they have to give in on their viewpoint to get the labor vote, or for some other reason they end up representing anything but the interest of the farmer. I hope that you realize that there are three or four different competing sections of the country and agriculture certainly does not want anything unfair. But there is such a thing as keeping a balance, and you cannot handle this without considering how it fits into the pattern of about four major groups.

Mr. BENSON. I would not be here today if I had did not have an intense interest in agriculture. That is my first interest, the agricultural industry. I have been part of it all my life and my sympathies are there. My experience is there. I have no political ambitions of any kind, and it is the welfare of the farmer that concerns me, the thing best for him.

Mr. WHITTEN. So frequently the Department of Agriculture gets shunted aside as compared with some of the other problems, and this was true during the Democratic administration, so it is no reflection on the other side.

Mr. BENSON. I do not have that fear from the contact I have had with the present Cabinet of the President.

Mr. WHITTEN. I know it will be his earnest desire to do what is right.

OUTLOOK FOR COTTON EXPORTS

Mr. Secretary, I appreciate the action of the Department in placing a representative in the Far East under the Office of Foreign Agricultural Relations to help with exports, particularly cotton. Please give us a report as to the present outlook for such exports and describe what efforts the Department is making to increase exports.

(The information follows:)

STATEMENT SUBMITTED FOR THE RECORD IN RESPONSE TO CONGRESSMAN WHITTEN'S REQUEST

Present indications are that our exports will be down from the 51⁄2 million bales of last year to about 4 million bales this year. This decline is serious, of course, for our producers. We are doing everything we can to cope with it. I have already called in a large number of agricultural, trade, and financial leaders to discuss the problem and out of this group I have appointed an advisory committee with which I am conferring frequently. At the same time we are assisting as we can in the arrangement of credit from the credit agencies of the Government. We are supporting the efforts in Congress to help through such measures as S. 800, which we think will facilitate sales by making it possible for American exporters to offer cotton from stocks held abroad; and we are sending our own representatives to Europe and to the Orient to assist in furthering our export trade wherever possible.

Mr. ANDERSEN. Mr. Secretary, we have a new member of our subcommittee, Mr. Hunter, of California, who represents more or less a different field from what Mr. Whitten, Mr. Marshall, and I personally represent. I will now throw the questioning open to Mr. Hunter, and I welcome Mr. Hunter to this subcommittee. He will prove to be of very great value to us.

Mr. HUNTER. It is true that my district differs considerably from that of Mr. Andersen and Mr. Whitten. The district contains about everything in the way of agriculture. I have agricultural products which require tariff protection; on the other hand, I have such products as cotton which are not particularly in favor of a tariff program.

Mr. Secretary, I have read your speech made at St. Paul and I must say that I think it was a good speech. I think that the inferences drawn and the picture painted of you as a monster intent upon throwing the farmers to the wolves are entirely unjustified.

FARM PRICE DECLINE

I would like to ask just a few questions. We all, I understand, agree that farm prices have been falling for about 2 years. In your opinion, what is the primary cause of that drop in farm prices?

Mr. BENSON. Well, I think I referred to them briefly in the statement. We have had a very heavy production, of course, the heaviest we have had in many years, and there has been a falling off in export of many of the important commodities, and I think there has been a reduction in certain inflationary measures. We had an inflationary period for some time. That seems to have been stayed now, and the inflation is sort of tapering off a little. That is probably having its effect. The general price level has declined somewhat which usually affects the price of agricultural products as well.

Mr. HUNTER. As you say, agricultural commodities are in long supply, generally speaking. Supply has increased and demand has decreased. I think it is important to note that. Mr. Whitten asked that you insert in the record, I believe, a statement comparing the personnel and the appropriations for the Department in 1940 with, as I recall, January 20, 1953, or some approximate date. I believe, Mr. Chairman, it would be well to include also a comparison of the functions and obligations of the Department in 1940 with those at the present time.

Mr. ANDERSEN. We will have that included in the statement to be inserted, Mr. Hunter.

EFFECT OF PRICE SUPPORTS ON OVERPRODUCTION

Mr. HUNTER. Mr. Secretary, do you feel that the present pricesupport program has contributed to the surpluses of agricultural commodities at the present time?

Mr. BENSON. I do not think there is any argument against that, Mr. Congressman. I am sure it has contributed. It is generally recognized whenever you peg a price at a high point it is bound to stimulate production. The corn-hog situation today is ample evidence of that.

MEAT PRICE TREND

Mr. HUNTER. Speaking of the corn-hog situation, do you feel that the drop in hog production will help in firming up the cattle market in the coming year?

Mr. BENSON. Well, of course it will contribute to a lessening of the supply of meat, the total supply of meat in the country, and yet, as the chairman has pointed out, numbers have not only dropped 14 percent this year compared to a year ago, but the intentions to farrow are 15 percent down. So apparently farmers still feel that the ratio is not sufficiently favorable to pay them to market the corn through hogs. It looks like we will have a further decline in hog population.

NONSTORABLE SALES

Mr. HUNTER. In your opening remarks, Mr. Secretary, you mentioned corn and used the word or the descriptive phrase, nonstorable sales. What is meant by nonstorable sales?

Mr. BENSON. As I understand it, it is the sales of corn that has deteriorated to the point where it would not be safe to store it. In other words, it has either gone out of condition or approaching that point where deterioration has either set in or is beginning to set in and it would not be safe to store it without taking a very heavy loss through depreciation.

ROTATION OF STORED CORN

I know what that means because the first carload of corn I ever bought from the State of Iowa and shipped to southern Idaho I found had gone out of condition. It had lost a lot of its food value and strength.

CCC CORN SALES

Mr. HUNTER. I notice that you are already practicing this procedure of rotating the corn that the CCC is holding and I notice that 9.6 million bushels have been sold since October 1952. Was there a loss taken on that? If so, how much per bushel on the average? Mr. BENSON. I would like to ask Mr. Davis to answer that question.

Mr. DAVIS. I do not have the answer exactly, but I would judge that probably 20 or 25 cents a bushel below what we have in it. Commodity Credit estimates that on all the corn that we now hold, that we have got about $1.60 a bushel against it and this was selling for some 30 or 40 cents below that. I can get the exact figure if you want it.

« ÎnapoiContinuă »