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The CHAIRMAN. It is fixed on what you plant the last 5 years.

Mr. CHAPPELL. It looks to me like if the acres were kept in South Carolina with a three-quarters of a billion production it would eliminate some of the surplus.

The CHAIRMAN. You can't do that unless you plant them and since you farmers didn't plant them you lost them. That is how it happened. If everybody had planted like you, you would have retained it but they didn't do it.

Senator JOHNSTON. They were increasing when we were decreasing;

Mr. CHAPPELL. Something else. You know that pulpwood, and rayon and nylon is substituted for cotton. I never have seen anything that anybody said anything about quota or anything on that.

Senator JOHNSTON. It is not protected.

Mr. CHAPPELL. No, but it seems to me since this is a great competitor of cotton it should be protected.

Senator JOHNSTON. Our free-enterprise system lets people do what they want to almost, in that respect.

Mr. CHAPPELL. We are in the same free enterprise thing in agriculture, farming, cotton farming.

Senator JOHNSTON. You are being protected and they are not.

Mr. CHAPPELL. I want to see why they couldn't protect pulpwood, put it on a program and give the cotton the protection. That is the part, if it takes that to get it I think we need protection. I don't think curtailing cotton acreage ought to let substitutes take our American industry away from us. We are getting stuff shipped in here, rayon, you take the Čelanese Corporation of America is importing their basic stuff from South America, I believe.

Senator JOHNSTON. What is that? Mr. CHAPPELL. Timber, pulp, and the Buckeye Cotton Oil Co. of Cincinnati

, Ohio, recently built a $15 million celanese plant in southern Florida and will be in competition with cotton. Something else to consider is this Anderson-Clayton has developed a lot of area in Mexico, irrigating area. I have a son in this diesel-motor business in California and one of his friends left there to go to Mexico to work on this project they are going to develop, just a vast territory down there. And Anderson-Clayton promised them they would give them so much for this cotton delivered to our border.

Senator JOHNSTON. Of course, Anderson-Clayton are not the only ones doing that. A lot are doing it in Peru, some in Brazil, Argentina. How to stop that I wouldn't know. You stymie me now.

Mr. CHAPPELL. That is why I am here. I don't want to take up more of your time but I wish we could get these competitive substitutes under control and give cotton its place in industry.

The CHAIRMAN. Thank you, sir.

Now that concludes the witness list that I have before me unless there is somebody that I called and who didn't answer. Is there anybody else?

Senator Thurmond, I understand you have a statement you want to make. We still have about 10 minutes before the hour.

STATEMENT OF HON. STROM THURMOND, A UNITED STATES

SENATOR FROM THE STATE OF SOUTH CAROLINA Senator THURMOND. Mr. Chairman and distinguished members of the committee, I want to take this opportunity to welcome you gentlemen here to South Carolina. We are delighted to have you here. I want to thank you for the attentive ear you have given to the farmers of our State.

I would like to express my gratitude to you for this opportunity to express my views on the most perplexing economic problem confronting our Nation. This problem is to provide our farmers with a fair income for their labors. During the congressional recess, I have had the privilege of addressing a number of farm organizations and discussing farm problems with hundreds of farmers and farm leaders from border to border in South Carolina.

Every meeting and discussion has led me to the inescapable conclusion that onr farmers are dangling from the horns of a twin dilemma-rising production costs and falling agricultural prices. The farmer's livelihood is constantly endangered by this dilemma from which no escape has yet been found.

Our nation's agricultural leaders and experts are-I believe-earnestly trying to come to grips with these problems. But thus far, no one has been able to come forward with an adequate solution to them.

I cannot today provide a cure-all answer to the problems which beset our farmers. I do believe, however, that I have some ideas that will aid the Senate Agriculture Committee in drafting legislation during the coming session of Congress.

Our farm problem must not be kicked around like a football for political gain by either party or any person. My sincere hope is that hoth political parties will work together in the best interests of the farmer. Political gain cannot be considered when the welfare of the Nation's farmers is at stake. Any man of any political party who is willing to capitalize on the suffering of our farmers for political gain is not worthy to be a public servant.

Permit me to suggest seven major points which, I hope that the committee will consider:

I might say most of these now have been mentioned, but I have a few facts I would like to bring out in connection with them.

1. Support of basic farm crops at not less than 90 percent of parity: Even if this is done, our farmers still receive, on the average, less than one-half as much income as persons engaged in other lines of endeavor. If producers are willing to make an honest effort to adjust production to consumption, there appears no sound reason to refuse the farmers this consideration. Let it be said to the credit of the farmers of South Carolina, that they have voted overwhelmingly for the acreage reduction program-over 97 percent for it. We should continue to favor 90 percent of parity on the basic crops until someone comes up with a better idea of insuring our farmers against price drops for their money crops such as cotton, tobacco, corn, wheat, peanuts, and rice.

At the present time tobacco is the only crop on a permanent 90 percent of parity basis. You have a House-approved bill not before your committee that would restore rigid price supports for a period

of 3 years. I have introduced a bill that would restore these supports on a permanent basis. If the committee cannot agree to bring out this bill permanently restoring rigid supports, it should approve immediately the 3-year-bill already passed by the House and now pending in your committee. I am sure it would receive swift approval on the floor of the Senate.

I introduced a bill for 90-percent parity. If the committee doesn't see fit to act on permanent parity, I hope it will bring out the bill the House passed on 90-percent parity.

The CHAIRMAN. I want to say that when the House passed the So-called Cooley bill, which restored the 90 percent of parity, your colleague here, Senator Johnston, made the motion to bring that to the floor immediately but the committee thought that if that bill were brought to the floor without further study that it wouldn't have a chance to pass, so that in the event we do submit the 90 percent of parity we will have something to add to it which will make it possible for the President to sign the law.

Senator THURMOND. I suggest for consideration of the committee instead of a 3-year bill, parity on a permanent basis. If it is good ito pass for 3 years it ought to be good permanently and if we find anything better, I am ready to go for something better, but until then I think 90 percent is available.

No. 2. Increase of sales of farm produce on foreign markets: As a result of our price-support system and our continual loss of world markets, the Federal Government has accumulated huge stockpiles of farm surpluses in Commodity Credit Corporation warehouses. In approaching a solution to our farm problems, one of the first steps to be taken must be the establishment of an orderly program for disposing of Government surpluses.

One of the most feasible plans for disposing of these surpluses is to be found through increased sales on the world markets, which in recent years we have been rapidly losing.

However, I was pleased to note Secretary of Agriculture Benson's statement of November 9, that in the first 9 months of 1955, one-third more CCC surpluses were disposed of overseas than during the same period of 1954. These sales have reached a total of $1,300 million.

Now let us consider the cotton surplus as an illustration of the problem. We have approximately 8 million bales of cotton in Government warehouses and by the end of this year we may have 4 million or more additional bales. At the same time our share of the world markets for this great money crop for South Carolina and many other southern States has dwindled from 60 percent to less than 30 percent of the world total.

It is in danger of being lost altogether. Cotton acreage in this country has been reduced 2514 million acres in 1953 to 17 million acres in 1955. By reason of the drastic acreage cut in 1955 alone, 55,000 cotton-farm families were put out of business. An additional 130,000 farmers already making less than $1,000 per year were reduced to an income of less than $900 per year. Senator Eastland of Mississippi and I, with the support of 60 Senate colleagues, have introduced a bill which we believe will help the Government cope with this grave situation confronting our cotton farmers. It has two purposes : To assure cotton sales in the world market at competitive prices and to establish quotas on imported foreign-manufactured cotton goods.

A program of this nature is essential if we are to prevent complete disruption of the economy of the cotton producing and manufacturing areas of this country. South Carolina, as you know, is a leader in both of these functions which are so vital to our national economy. I advocate increasing world sales on an orderly basis not only for our cotton surpluses but also for other crops which are so vital to our economy, such as tobacco, corn, grains, and dairy products.

3. Improvement of domestic marketing system for farm produce: I believe it is imperative to improve our domestic marketing system of farm produce throughout the United States. Last summer cantaloups which sold at 3 cents each in South Carolina were sold in Washington for 35 cents each. This is a deplorable situation which should be remedied. Growers must get more of the profit out of the crops they produce.

The CHAIRMAN. I want to say that the cantaloups that sold in South Carolina for 2 or 3 cents sold in Washington and New York for 40 cents and 50 cents, and the farmer does not make the profit.

Senator THURMOND. If a study could be made of the situation it would be a godsend to farmers.

No. 4. Expansion of agricultural research to enable the farmer to produce at a lower cost: I favor more expenditures for expanded research projects and extension services, such as those at Clemson College, to teach our farmers how to produce their crops for less money. Increased research is vital to secure greater knowledge on the use of fertilizer, methods for fighting insects, diseases, soil erosion, marketing, et cetera. Certainly one way to offset the problem of rising prices on farm implements and supplies is to find methods of reducing the costs of raising the crops. With the farmer paying more and getting less, he must learn to produce at a lower cost.

This is one of the most important things that can be done because our farmers must be able to produce at a lower cost to stay in business and compete. This research is essential.

5. Study of acreage-allotment system for a more equitable acreage distribution: We must arrive at a system for allocating acreage allotments on cotton and tobacco that will be most satisfactory to the greatest number of farmers. Much of the mail I have received has been on this subject. A study should be made of our family-size farms under the acreage-allotment system. Under the present setup, acreage restrictions are driving some small-acreage farmers off the land. Others are being pushed into marginal operations.

6. Improvement of disaster-relief program: Recent natural disasters, such as floods, droughts, and freezes, have cost farmers millions of dollars. We must improve our disaster-relief programs. Drought aid should be extended to cover hogs, poultry, and farm workstock as well as cattle. Legislation should be enacted to provide assistance to cover farm animals affected by a shortage of feed grains as a result of natural disasters.

7. Payments to farmers for retiring acreage growing price-supported crops: If the diverted acreage is planted in legumes or other soil-conserving crops, a larger payment should be allowed than if this is not done. This proposal is not a complete solution, but it is believed the reduction in acreage would aid greatly in avoiding large

surpluses, thereby relieving the Government of the expense of disposing of the same,

That is important not only to this generation but future generations and in case of war or emergency when we will want to have fertile soil to produce large crops.

I feel, too, if such a plan is adopted, it would be preferable for it to be tried on a voluntary basis-a voluntary plan is more desirable than a mandatory one--however, if it should not function properly on a voluntary basis, then compulsion may have to be used, and the Secretary of Agriculture should be given the needed authority to make it work.

During the past session, I joined Senator Russell and several other Senators in introducing legislation that would have given relief to thousands of peach farmers in South Carolina, Georgia, and other States which lost their crops as a result of an early-season freeze. This bill would have granted temporary additional crop acreage to these farmers. Had the bill passed, such farmers would have been authorized to grow a substitute money crop to provide a livelihood for their families and farm workers. This bill was approved by your committee and by the Senate. The House Agriculture Committee tabled the bill. Legislation of this type is just as needed as ever and should be enacted as soon as possible.

I am happy to inform you that the Agriculture Department has agreed, at my urging, to negotiate a peach-crop-insurance program with South Carolina peach growers. It is hoped that such a pilot program will be available to our peach growers in 1957.

As I conclude these remarks, let me urge you, as I know you will, to give thorough study to the suggestions which have been made by the agriculture leaders you have heard during the course of these hearings. It is difficult for any of us to recognize the problems existent in agriculture. It is extremely difficult to arrive at workable solutions to these problems. Nobody knows the practical approach to their consideration like the farmer himself.

I commend you today on hearing these farmers who know their problems and have presented them to you.

Also permit me to commend the Agriculture Committee for the interest and time it has devoted to the problems of the farmer during this year. With unity of purpose, I am confident that adjustments can be made in agricultural laws which will improve the lot of the farmer in this State and the Nation.

Thank you very much.

The CHAIRMAN. Is there anyone else who desires to be heard? I wish to express the gratitude of the committee for your attention and we hope from what we have heard from you and what we expect to obtain from other sections of the country that in early January we will be able to draft a law that will assist the farmers as a whole.

If there is nothing further, the committee will stand in recess until 9 o'clock tomorrow morning in Raleigh, N.C.

(Whereupon, at 5:05 p. m., the committee was recessed, to reconvene at 9 a. m. the following day, Tuesday, November 15, 1955, in Raleigh, N. C.

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