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There are several phases of the proposed farm legislation which has my special interest, but today I will confine my remarks to the importance of an expanded export market and the need for a minimum small farm provision.

EXPORTS

The gravest problem facing cotton is our export market. We have tried to solve this problem by reducing acreage, thus causing a real sacrifice among all growers. At the same time foreign production has gone up until foreign consumption exceeds foreign production by only 2 million bales. In looking over a report published on October 24, 1955, by the International Cotton Advisory Committee, this statement struck me: "If present trends continue, in two more seasons cotton production outside the United States may be sufficient to meet all consumption requirements outside the United States without any imports from that country." Now, what the International Cotton Advisory Committee is saying is that if we continue down the road that we are now traveling, by 1959 the rest of the world will not be required to import a single bale of cotton from the United States. While we have decreased our cotton acreage in the United States by some 8 million acres during the last 3 years, foreign acreage has increased 19 million acres.

Added to this is the growing threat of synthetic fibers. In the foreign nations I recently visited, I diligently sought out and talked with foreign businessmen who purchase cotton; I talked with American businessmen there who sell cotton. 1 talked with the representatives of our Government and of the foreign governments who deal with cotton problems. My definite conclusion was that we are being rapidly driven out of the foreign market by our high prices, by foreign production, and by synthetics. I am disappointed that the President's agricultural message did not fully recognize the importance of our export market. The President and the Department of Agriculture have completely failed to recommend an export program to meet our pressing needs.

It is extremely important that we concentrate on a worldwide, long-range plan for selling American cotton in foreign markets at world competitive prices. A short-range policy of dumping our cotton on world markets will not be the solution. I firmly believe that this is one of the greatest problems facing our cotton industry and hope that this committee will move at the earliest possible date in reporting legislation which will direct the Secretary of Agriculture to use authority which he already has to regain at least a 5-million-bale export market. A firm long-range export policy will go a long way in restoring confidence to our market.

A dynamic export program of this kind will not be complete if reasonable protection is not provided for our domestic mills.

THE SMALL AND FAMILY-SIZE FARMER

I continue to be concerned with reports which I receive that thousands of farmers are being forced to abandon their farms to seek employment elsewhere. Of course, we recognize that some shift from the farm is good and desirable but there is a question in my mind as to how fast we can safely make this shift and maintain a desirable balance. A study made by the Department of Agriculture last year stated that 55,348 renter families were forced off the farm due to the 1955 reduction in the cotton acreage allotment. Mississippi led the list of displacements with the loss of 11,981. Other States which had high losses are as follows: Georgia, 8,157; Alabama, 7,554; Arkansas, 4,246; Louisiana. 3,395.

The reduction of 700,000 acreage allotments again in 1956 greatly accentuates this problem.

MINIMUM SMALL-FARM REQUIREMENT

Last year, I cosponsored a bill with Senator Eastland, of Mississippi, and Senator Gore, of Tennessee, which would relieve some of the hardships inflicted on the small and family-size farmer resulting from acreage allotments. As you remember, this bill provided for a national reserve of 1 percent and was designed to restore the mandatory small-farm provision contained in the law for a number of years. This bill provided for a new minimum which would in effect assure each farmer the smaller of 4 acres or 80 percent of the highest planted in 3 previous years.

PRESENT LAW

The present law directs a small farm allotment of the smaller of 5 acres or the highest planted in 3 previous years only in the case where county committees choose to allocate their acreage on a cropland factor. In cases where county committees use the history basis the small-farm provision is permissible. In 1955 out of the 1,078 counties growing cotton only 103 counties apportioned their acreage on the cropland basis. In other words only a very small percentage of the counties used the formula which required the mandatory small-farm provision. In Mississippi only 12 counties used cropland as a basis for apportionment and all of these were located in the Delta. On the other hand, out of 984 counties in the United States which allocated their acreage on a history basis only 92 or less than 10 percent provided for the small-farm provision. In the case of Mississippi only 1 county using history as a basis used the small-farm provision. In addition none of the Mississippi State reserve was used adjusting allotments to small farms. This created a great hardship on many of our small farmers and emphasizes the need of a national reserve to assist the States in providing a minimum allotment for the small farms.

1956 COTTON ALLOTMENTS FOR MISSISSIPPI

The Mississippi State Committee has made a special effort to provide for the small farmers in the 1956 allocations. While none of the counties which selected to use the history method as a basis have used the minimum small-farm provision, I do understand that the State committee has used a part of their reserve to match acres with county committees in an effort to raise the small-farm allotment up to the smaller of 4 acres or 75 percent of the highest planted. This is a commendable effort on the part of the State committee, and I feel that 1 or 2 percent national reserve earmarked for the small farm would greatly assist the State and counties in making an equitable adjustment, and would also assist the small and family-sized farm unit.

If a minimum small-farm allotment of the smaller of 4 acres or 80 percent of the highest planted acres had been adopted for the 1956 crop it would have given relief to 407,748 farms in the Cotton Belt. In Mississippi it would have affected 53,645 farms, in Alabama 64,274, North Carolina 59,167, Georgia 38,594. I believe that this is a sound approach in giving needed relief to our small and familysize farmers and I urge this committee to include a mandatory small-farm provision in the 1956 farm bill.

Senator SCOTT. Mr. Chairman, I would like to ask Senator Stennis a question.

The CHAIRMAN. Senator Scott.

Senator SCOTT. What do you think of the 100 percent of parity for those boys?

Senator STENNIS. You mean, 100 percent for them and less for others?

Senator SCOTT. Yes.

Senator STENNIS. Well, I think, Senator, that the simplest way would be to get at it on this acreage and let them go with the rest so far as the support price is concerned.

Senator SCOTT. What do you think of the excise tax?

Senator STENNIS. What do you, excise tax?

Senator SCOTT. On the end product, like cotton.

Senator STENNIS. Well, I have not gotten into that. You mean the export subsidy?

Senator ScoTT. No; just on the finished goods, on your shirt, and so forth.

Senator STENNIS. I could not help the committee on a problem like that. I am not prepared on it, Senator. But I know your State is vitally affected by this.

Senator SCOTT. Yes.

Senator STENNIS. Thank you very much again.

The CHAIRMAN. All right.

Governor Freeman, have a seat, sir.

Governor FREEMAN. Thank you.

STATEMENT OF HON. ORVILLE L. FREEMAN, GOVERNOR
OF MINNESOTA

The CHAIRMAN. Governor, as I recall, you appeared before our committee when we were in Minnesota, did you not?

Governor FREEMAN. I welcomed you, and I said I would reserve making testimony before the committee to come down here where we would not get underfoot of some of the dairy farmers that were out there to talk on that occasion.

I have here, Senator, two statements. One I would like to review with the committee. The other I would like to file and at a subsequent time, perhaps, when you get into this question of milk marketing orders, and sanitary regulations-that is not the subject directly before you at present, I gather; is that correct?

The CHAIRMAN. That is right.

Governor FREEMAN. So if I may say so quickly, I think the title is rather self-explanatory:

A Statement Concerning Certain Artificial Barriers and Restrictions to the Free Flow of Commerce Between the Several States in Milk, Cream and Related Dairy Products, That Is, Phoney Sanitary Regulations and Distortions of Federal Milk Marketing Orders.

The essence of it is that we felt that there ought to be a national sanitary code imposed uniformly everywhere and secondly, we specified four different areas where we feel the present milk-marketing orders are being abused to the detriment, we feel, of both the producer and the consumer. And we have made a rather careful study of this, and at a subsequent time, if you want it supplemented, we would be happy to do so. I thought I would just file it.

The CHAIRMAN. The statement can be filed for the record and you may proceed with your regular statement.

Governor FREEMAN. Thank you very much, Senator.

Senator HUMPHREY. Mr. Chairman, I would like the Governor just to indicate on what basis this milk-marketing study was made. I think the committee would be interested to know that.

Governor FREEMAN. Thank you, Senator Humphrey.

At my request to the last session of our legislature, they were directed to investigate this whole question of both sanitary codes and milkmarketing orders, and to report back to the legislature, to appear before this committee, and potentially and possibly to institute appropriate legal action, both in the courts and before the administrative agencies where this question is concerned. And based on that directive from our legislature, this study has gone forward, and this is the initial report based upon about a year of analysis of this problem. The CHAIRMAN. Proceed, Governor.

Governor FREEMAN. All right. Thank you very much.

The CHAIRMAN. Now, if you desire, Governor, you could file your statement and highlight it for the record, if you want to follow that procedure.

Governor FREEMAN. All right. I would like to run through this statement in some detail, if the committee can spare the time.

I appreciate the opportunity to come here. I have really four points that I would like to make here that are covered in this statement: (1) A few facts which indicate Minnesota's concern for an adequate national farm program; (2) some important aspects of the current agricultural situation in the United States which I believe should be basic in any consideration of an agricultural program; (3) the principles and goals which I believe ought to be the basis of our agricultural policy; and (4) certain basic agricultural programs which I think should be incorporated in the bill which you will enact.

As Governor of Minnesota I feel a deep responsibility for the interests of all the people in our State; and an obligation to urge you to enact without delay a comprehensive program that will remedy the serious farm situation which now threatens the livelihood of so many Minnesota people.

Agriculture is a major factor in Minnesota economic life. Twenty percent of our people earn their living on farms, as compared with a little over13 percent for the United States as a whole. Much of Minnesota's business and industry involves the handling and processing of agricultural products. Minnesota merchants depend on farm purchasing for a great proportion of their business.

In fact, the economic well-being of all the people in Minnesota is affected to a substantial extent by the degree of prosperity of our agriculture. I believe this to be a general principle which applies as well to the people throughout all of the United States.

Minnesota's agricultural production is highly diversified. In 1954, 70 percent of the cash receipts from farming came from livestock, dairy, and poultry products, and 30 percent from all crops. Corn accounted for 10.2 percent, soybeans for 3.8 percent, oats for 2.1 percent, and wheat for 2 percent. Dairy products alone accounted for 18.6 percent, cattle and calves for 17.3 percent, and hogs for 20.5 percent. These figures clearly show that a program which affects principally wheat and corn cannot begin to meet the needs of Minnesota farmers. They indicate how serious the drop in prices in dairy products and hogs have been for Minnesota.

The State-Federal crop and livestock reporting service reported in September of 1955 that Minnesota cash receipts from farming and Government payments were $24,365,000 lower in 1954 than in 1953. This is a 2 percent decrease in just 1 year. The 1955 totals have not yet been reported, but the agricultural marketing service reported on January 3, 1956, that average prices received by Minnesota farmers in mid-December yere 9 percent below the December 1954 level.

Other estimates indicate that while production in the grain crops will be about 4 percent greater, that income, total value, is about 4 percent less.

I am a little uncomfortable with some of these figures and some of these statistics. And I might say here, off of this statement, that in checking, we found that the Council of Economic Advisers does not have independent figures themselves in relation to agriculture, and I have found so many conflicts, very frankly, in figures that I find from my own State department of agriculture that I am trying to get balanced out and that come from various Federal sources, and it is very confusing, and I find that a lot of people, the public, are very

confused in relation to some of the competing and conflicting figures. And I would say that perhaps this committee might institute some kind of analysis of current figures and an accurate statistical appraisal of what really takes place, so that people would know better.

I find confusion compounded in discussing this with people, with figures coming out of everybody's hat, and I cannot get them pegged myself. I am sure you gentlemen can, but most of us cannot.

Senator AIKEN. What do you consider, Governor, as the most reliable source, of figures?

Governor FREEMAN. Well

Senator AIKEN. I agree with you that some of our criteria for measuring farm income are so obsolete that they really do not tell the - story at all.

Governor FREEMAN. I suppose the one that I have relief on most to date, Senator, has been the Federal-State crop reporting service in our own department of agriculture, but I can honestly say that I have found figures that they used in different places that are different.

Senator AIKEN. That is, their figures show a substantial increase in income above 1954, and you do not go along with that?

Governor FREEMAN. No, that is not what I said at all. I am not getting into that at the moment. What I am saying is that I have seen figures used in one text for, say, total production or total value, and then in another place, total value or total production figures that are different.

The CHAIRMAN. Is that on a national basis?

Senator AIKEN. I agree that this reporting, as I say, is so outmoded that it really does not mean much. It does not take into consideration the work of the cooperatives, and we know perfectly well that when a citrus grower sits on top of the world at 60 percent of parity, there is something wrong with the parity formula, when your dairyman perhaps hits the break-even point at 100 percent of parity.

Governor FREEMAN. In connection with the application of parity, in particular

Senator AIKEN. The parity formula, I think, discriminates against the dairy market and I think it favors certain producers of other crops perhaps in your State where mechanization has revolutionized the methods of production.

Governor FREEMAN. The point I was making, Senator, was that even the raw figures, let alone the varied comparisons, I find in conflict on occasion that come out of these various departments and out of the Department of Agriculture.

Senator AIKEN. There is no question about it.

Governor FREEMAN. Then I find people that throw up their hands in despair and say that nobody can understand this thing, because everybody is talking about different figures at different times. And what does this mean?

Senator AIKEN. That is partly due to the fact that technology has been running so far ahead of us that we cannot keep up with it. Governor FREEMAN. Yes.

The CHAIRMAN. Governor, are we to understand that the figures with respect to Minnesota that are looked into and discussed by your own people differ from the ones that are submitted by the Federal Government?

64440-56-pt. 8—35

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