We should not lose sight of the long-term needs for food and fiber of our own people and those outside our borders. The productive potential of our soil and water resources must be conserved and enhanced.

Senator SCHOEPPEL. Mr. Chairman, I would like to ask the Governor, Do you have in your study of this problem anything to suggest to this committee as to what that family-sized farm would be or could be or should be? There are limitations, I am sure you might be aware, that fit Minnesota or might fit Kansas, and might not fit for the South, East, or West.

Governor FREEMAN. Yes.

Senator SCHOEPPEL. Have you given any thought or study to that? Governor FREEMAN. I have given some study to it, Senator. I am sure not as much as you have or this committee. The best I can define it is by referring to the statement that the family-size farm by and large, is one that is operated by a family unit that may be has itinerant help, but primarily functions around a family unit with one hired man, who live on the place and operate the place.

Senator SCHOEPPEL. I see. And I note that in that paragraph you again refer to the huge corporate-type farming enterprise, and I asked you a while ago about whether you had any law on your statute books. I think this committee should know that Senator Capper, who was once a member of this committee and onetime chairman of this committee, as Governor of Kansas, in his wisdom and judgment of members of the legislature, put on the statute books in my State a law preventing corporate farming, and that has been very seriously adhered to. And I think that may be something individually these States

would want to consider.

Governor FREEMAN. What difference would it make, Senator, if it was a corporation or if it was a private person that owned 50,000 acres? Senator SCHOEPPEL. Well, he can get at it a little bit better if he is a corporation.

Governor FREEMAN. I think it would work better politically, but I am not sure that it makes any difference practically.

The CHAIRMAN. Proceed, Governor.

Governor FREEMAN. It is obvious that only a program that is national in its scope can meet the needs of American agriculture. I have already stated that no way has been devised whereby millions of independent producers can coordinate a program except through Government. This is very clearly an area in which a great need exists, and there is no other agency which can meet that need except Government. No preconceived attitude of opposition to Government action per se should be permitted to overshadow that fact. It is a basic principle of our democracy, held by our Founding Fathers, announced eloquently by Abraham Lincoln, and followed consistently by our people, that when a need exists which cannot be met by individual action or by any other private means, it is the obligation of Government to act.

A national program should not be arbitrary or overcentralized. Overall planning must be national in scope in order to be effective. But decentralized administration by farmers themselves through democratic processes adapted to each locality, making use of farmer committeemen elected by the farmers themselves, and charged with real responsibility, should be a major feature of the program.

This local direction by farmer-elected committees is of utmost importance, particularly in a program which involves control of production, for in such a program success depends upon the understanding and participation of farmers. In Minnesota we have had convincing experience of the importance of this factor.

During the 4 months between November 1, 1939, and March 1, 1940, the committee program reached 211,868 farmers at 4,199 meetings, held in every county in the State. The Extension Service, PMA, FHA, SCS, and every agency concerned cooperated.

The Minnesota figure for farmer participation and compliance reached 94 percent. But in recent years this picture has changed. Local committees no longer function as actively as they did, and county office managers perform most of their functions. The attitude has changed. Farmer participation has dropped considerably, to an average of 50 percent or lower.

Any agricultural program, and especially one in which production control must be an important part, means the economic livelihood of our farmers. They have a right to local participation. This is the only means by which such a program can be planned locally on a sound basis and effectively carried out. It alone can produce the understanding necessary for the success of the program.

Senator AIKEN. Governor, are you referring to the ACP programs or compliance in keeping within the allotments?

Governor FREEMAN. I am referring to both of them, sir. I think the ACP program in our State now is down to under 40 percent, and the allotments-it is a little difficult-of course, when you have corn, that is down to 50 percent below compliance requirements now.

Senator AIKEN. Then the drop in ACP compliance or participation in that case would not hold true in all States, because in my State we have used up all the money, and I am seriously thinking of asking the Appropriations Committee, of which our chairman is one of the most influential members, to put the ACP appropriation up to where we can have money enough in Vermont to carry out the practices which are already approved.

The CHAIRMAN. I suggest you see Secretary Benson.

Senator AIKEN. We have used it all up this year. No. I think the Appropriations Committee can do it in this case.

The CHAIRMAN. But they fight it, though.

Senator AIKEN. They have approved $50 million more than they usually do.

The CHAIRMAN. Well, that is chickenfeed.

Senator AIKEN. But it needs probably another $50 million.

Governor FREEMAN. I feel very strongly in talking to farmers that when you talk about production control, which obviously we have to have if we are going to have supports, you just cannot administer a program of production control without local farm committee participation.

Senator AIKEN. Yes. I think, Governor, that we have got to have a wider program than the ACP program for those States which cannot participate in the soil bank program to a great extent, such as yours and mine.

Governor FREEMAN. I agree with that, Senator.

Senator AIKEN. They are the diversified production States. The CHAIRMAN. Governor, could you state the reason for this difference in compliance?

Governor FREEMAN. I think it has been――

The CHAIRMAN. In the last few years as compared to the early stage of this program.

Governor FREEMAN. You take the responsibility for making decisions away from people, and they no longer care to participate. And I find throughout our State that farmers on an advisory and not an active basis see no reason why they should give the time and effort and interest to this program that they gave before, because they are not doing anything.

Senator AIKEN. I think, Governor, one year they tried requiring the farmers to go into the office and sign up for participation in the program, and I believe they have given that up this year because there was a drop in participation when they had to go to town and sign up to go along with it. This year I think it has been the practice in many States, at least I know it has been in mine, that the representative of the ACP calls the farmers up or else sees them somewhere. As I say, participation is large enough that we have used up all our money, and we would use more if we had it.

Senator HUMPHREY. One of the problems which we have got out there, which nobody can minimize and I recognize the difference in the national pattern-is that you have always had county managers, not always, but for a long time, in the Northeast and you have had them down in the southern part, but there was about a 16- or 17-State midwestern area that has had the old farmer-elected committee system doing the program with a chief clerk, and that program, when it changed over to a county manager system, has caused serious difficulties. They are primarily psychological.

But there is no use kidding yourself. These factors are there. Now, I have found this out in Iowa. I was down in Iowa and I visited with a number of these people. I have had innumerable letters because of the inquiry that we made into this. And every time I have gone home to Minnesota, all I hear from the farmers that come in is the problems that they have with their county committees. They are relegated to this advisory capacity, and whether they are right or wrong, that is not the important thing. It is how they feel about it. And they just do not like the county manager system.

Now, they may like it 4 years from now or 3 years from now. Senator AIKEN. We had a little different situation in that it was difficult to get county committeemen and local committeemen who wanted to spare the time to do this work. And so I think that hiring an office employee relieved them of some of the work which they did not want to do, anyway. There was a drop, however, in the year 1954, when they were required to go to the office and sign up for these benefits. But this year that drop has been wiped out, and I think probably we are having a record year in participation.

Senator HUMPHREY. I want to mention this Missouri situation. I find that the committee chairman of the ACP down there had never been a participant in the program. The second member of the committee had never been close to participating. I will say that the chairman had one participation. He had one crop on corn, over which

there were some allegations. That is the chairman. The second man had never been in the program. And county manager after county manager had never been even close to being in the program.

In other words, they came out of college and they knew a lot about business administration, or they knew something about the theories of economics, and they took a test and they were hired and they were put in as county manager. And farmer after farmer came in and said, "This guy doesn't know anything about farming. I just don't want to participate with him."

Now, that kind of problem just magnifies the lack of participation. Senator AIKEN. There has been another reason for the full participation in my State, in that all Federal agencies, all farm organizations within the State, and all political parties within the State all work together.

Senator HUMPHREY. That make a world of difference.

Senator AIKEN. That makes a tremendous amount of difference. And I know that there have been some States where there has been a great deal of activity spent in fighting each other instead of cooperating for the same end.

The CHAIRMAN. Proceed, Governor.

Senator ANDERSON. When he says all these political parties work together, I understand how he gets elected so easily. I did not understand that.

Governor FREEMAN. I was thinking about that, too, Senator. [Continuing:]

CAREFUL STUDY AND ANALYSIS

The formulation of specific programs should be based upon a constant consideration of the goals to be achieved. It should involve a careful study of successes and failures of measures that have been tried, the soundest possible statistical analysis, and a careful considation of the trends of technology and population in a changing world. You have access to such information, research, and analysis. The time for decision has arrived. An adequate and effective farm program must come out of this session of Congress.

IV. I should like to present a few important features that I believe should be incorporated in the comprehensive program which should be enacted.

PRICE SUPPORTS

Price supports at fixed levels of at least 90 percent of parity should be restored immediately-and they should apply to all products which are in fact basic to our agriculture, and not merely to 5 or 6 products. The facts which I have presented about Minnesota make it clear that to most of our farmers livestock and dairy products and other perishables are of major importance. Any program which is to be both equitable and effective should include these products for parity support.

But price supports alone are not enough. Programs should be developed and directed not only toward parity prices but toward parity in income. Production payments along principles now followed for sugar and wool should be used. We should use loans, purchase agreements, production payments, and any variation or com

bination of these and other techniques, when they can contribute to the overall goal.

As a part of such an income support program, intelligent, equitable, and effective use of production controls is essential. I would repeat that this must include local farmer participation, broad acceptance, and general understanding.

FAMILY-SIZE FARMS

The support program should provide special encouragement to family-size farms. A program which would pay higher supports in cases where the total gross income of a farm was within the range usually received by such a family farm would provide substantial encouragement. Such variations in support levels, based on gross income, would help to improve the competitive position of the familysize farm in relation to large corporation farm.

MORE AND EASIER CREDIT

Easier credit for farmers should be provided. This, too, would be of special assistance to family farms. Young farmers who began after the war have been particularly hard hit by the cost-price squeeze, because the capital investment they had to make was so great, and they have had constantly decreasing returns. In Minnesota most farmers are paying 8 percent on short-term chattel loans-and 8 percent interest today will put almost any family-size farmer out of business if he must operate on very much borrowed capital.

Senator THYE. Governor, do you mind an interruption at that point?

Are these young farmers taking advantage of the Production Credit Administration and obtaining loans in their local section?

Governor FREEMAN. They tell me that they are trying to.

Senator THYE. Yes. But those local associations do not charge them 8 percent, Governor. In the Tri-County, in Washington and Dakota, these counties have an excellent loan association, and I am positive that they are not charging 8 percent. If they are, I would be very much surprised, and I helped organize that.

Governor FREEMAN. Which one is this?

Setnator THYE. The Tri-County Credit Association, the Production Credit Association, and that is Dakota County and Washington County. They have their offices there in that Tri-County organization, and I know that they are not charging 8 percent, Governor. That association has been in existence now for some 8 or more years. Therefore they must be strong enough to be fairly safe in supplying the needs.

Now, if it was a short-term

Senator HUMPHREY. That is it.

Governor FREEMAN. That is the point.

Senator THYE. Short-term at the bank.

Governor FREEMAN. That is just precisely what I am talking about. Senator THYE. No. But there are in those different counties, Governor, the credit associations, and they were functioning in the thirties prior to the war, and they have stayed in continuous operation, because I have attended their annual meetings.