to satisfy the demand at a price which will cause its continued production and consumption. Therefore, we do not believe it to be necessary or practical to directly support the prices of livestock or other perishable commodities.

History shows that wheat and corn prices have fluctuated in a definite pattern relative to general commodity prices. As commodity prices rose, the price of wheat and corn would likewise rise; sometimes to comparatively high levels as supplies were short, and sometimes to low levels in relative exchange value for other commodities when supplies were large. Over the years the average low prices were at a level of about 70 percent of the normal exchange value of wheat and corn for these other commodities. The high levels were at about 120 percent. Therefore, the following recommendations appear logical.

1. That the Secretary of Agriculture be empowered to buy wheat, corn, and cotton from any owner on the open market when prices go as low as 70 percent of parity, or the relative exchange value for other commodities.

2. The price would change on a monthly basis as general commodity prices change.

3. Once the Government had made purchases, the grain would under no circumstances be offered for sale in this country until the price had risen to the 120-percent level. Except for the 400 million bushel carryover in the ever-normal granary, all surpluses should be sold on the world market each year they are produced. Export subsidies should be brought into use when and if necessary.

4. That the State Department cooperate with the Department of Agriculture in disposing of surplus agricultural commodities on the world market in a way that would create goodwill and peace among all

nations.

5. The present loan support program involving acreage controls will discourage agricultural progress. We also believe that larger surpluses will be accumulated with this program than by the proposed direct purchase plan. Currently, so much grain is being sold below the loan level that the entire purpose of the support program is defeated. But if all users of grain, as well as speculators, knew that the Government would offer to purchase every available bushel at 70 percent of parity and that none would be sold until it reached the 120percent level, it is reasonable to assume that there would be ample buying and speculation in the market to prevent prices from reaching the low level. It would also be much less costly to administer than the loan program, and give farmers more freedom in operating their business.

6. Full production on farms will not create insurmountable problems if food is provided for the millions of hungry people throughout the world. By raising their standard of living, new markets could be created for both agricultural and industrial products. Through export subsidies this could be achieved in times of excessive supplies and would be an excellent investment in future prosperity for our entire population. A stable agricultural economy is no longer the concern of farmers exclusively. Almost every other business enterprise in the United States is dependent upon farm purchasing power for its continued prosperity. Although we are basically opposed to subsidies, as such, we believe that so long as other industries are subsidized, agriculture should receive like consideration if essential for the preservation of a sound national economy.

In conclusion, it should be remembered that during any given 10year period, every bushel of grain and every pound of meat has been consumed; and nature will probably prevent surplus food from becoming a burdensome problem in the future over a like period. Thank you, gentlemen.

Mr. DAGUE. Thank you, Mr. Knoop.

Mr. Mapp is the next witness, and following him will be Mr. Ralph Tugen, of Jersomesville.

STATEMENT OF LESLIE C. MAPP, PRESIDENT OF OHIO MILK PRODUCERS FEDERATION

Mr. MAPP. Mr. Chairman, members of the House Agriculture Committee, I am appearing here today as president of the Ohio Milk Federation. This federation represents a group of dairy cooperatives whose membership totals around 20,000 dairy farmers in Ohio. I also am general manager of the Ohio Milk Producers Association at Dayton, an organization owned by some 3,000 dairy farmers. I want to speak first of the support prices of dairy products.

We believe that the support price on dairy products should be continued at 90 percent of parity by the Secretary of Agriculture or by Congress, if necessary, during the production year beginning April 1 of next year. The support price on the so-called basic commodities are be continued at 90 percent of parity with certain acreage allotments. The Congress in 1952 amended the Agricultural Act of 1948, providing this 90 percent support for the so-called basics through December 31, 1954. We believe that this 90 percent support is necessary for dairy products for the following reasons:

(1) The proteins in dairy feed necessary to produce milk will still cost dairymen 90 percent of parity if purchased.

(2) Some inducement must be offered dairy farmers to put feed through cows rather than selling the cows and storing the grain. Dairy herds are not easily built and it takes years of planting. It is generally conceded that, in view of the future growth in population, expanded dairy production will be needed. According to the Bureau of Agricultural Economics we will need a 25 percent increase in milk production by 1975, quite a way off. In the last 10 years we have had no increase in milk production as compared to 10 years ago. Milk production in the United States in 1954 will be no greater than it was 10 years ago. Production must increase 25 percent by the year 1975, in order to keep up with population increases.

(3) Dairy production has not expanded at the rate of the expansion of the so-called basic commodities. The sum of money invested in dairy products by Commodity Credit Corporation is a much smaller percent of the value of the annual production than the money invested in the support program for other farm commodities.

(4) We are convinced by experience in the last year that if the support price on dairy products is lowered that it is doubtful whether the consumer will benefit materially, because a wider spread between consumer prices and farm prices will occur. Prices received by dairy farmers have dropped 13 percent in the last 12 months, almost 1 percent a month, and today the farmer is receiving a lesser percent of the consumer's dollar than for many years, this being caused by higher distribution costs and lower farm prices. In this process we might find some inefficient milk processors.

Consumer benefits from price supports: We believe that not enough has been said about the value of price supports in protecting consumer prices. When the Government is buying commodities under the pricesupport program, consumers are assured that as long as these commodities are held by the Government that consumer prices are going to be stabilized, thus preventing extreme variations in consumers' food prices. I think we might better call this program a price-stabilization program rather than price support. Government holdings of farm commodities always act as a price deterrent and serve to hold down food prices to the support level. Unusually high food prices to consumers have occurred during those periods when the Government was holding no products under the support program. Butter presently is near the support price, and it will stay there so long as the Government is holding as much butter as it is.

It should be pointed out, also, that in the national defense effort a food reserve-call it surplus, if you will-is as important as stock holdings of strategic materials. The food which the Commodity Credit Corporation held during the beginning of World War II was very fortunate. Otherwise, we would have had a much more serious food problem during the early war years, as well as inflationary pressures resulting from shortages.

Overall, the price-support program carried on by Commodity Credit has been relatively inexpensive. The net loss on the CCC price support overall program for the fiscal year ending June 30, 1951, was $61.1 million, compared to $67 million for the fiscal year ending June 30, 1952. Going back over the entire length of price-support programs since 1933, the losses sustained under the overall price-support program to farmers have totaled only $752 million. It might be interesting to note that during the same period the Government sustained a loss of $2,400 million in the handling of second-class mail, which is more than 3 times that figure. The question might be asked, "Is the welfare of farmers less important than that of handling secondclass mail?"

We believe that the price-support program on dairy products can be improved in several respects:

(1) We believe that if the purchase of butter, powder, and cheese were carried on under a plan of monthly price adjustments, reflecting actual storage charges, that this would encourage the industry to store its own products, rather than selling them to the Government and holding very little for storage. There is no inducement to store dairy products by the industry in the period of flush production under the present program, as today we have less dairy products held by the dairy industry than we normally have in private hands.

(2) Coupled with this, we believe, also, that if commodity loans were made to farm cooperatives at 100 percent of the support price, that this also would induce the holding of inventories by the farm cooperatives, because you can't hold milk and butter on the farm. This lending could be carried on through Farm Credit Administration. I would like to say a few words about the Federal milk order proWe Ohio dairy farmers vigorously oppose those interests in certain other States who are currently attacking the Federal milk order program. It is apparent that those attacking this program are confusing the issue. We believe that we in Ohio are in a position to speak with experience on the value of a Federal milk order program.

The State of Ohio ranks sixth nationally in the value of milk produced on farms, and under the Federal milk order program, approximately 24,000 producers sell milk in Ohio markets covered by Federal milk orders. This represents a very large percentage of all the producers shipping milk to markets in Ohio. It might be of further interest to note that Ohio is second only to New York State in the number of producers covered by Federal milk orders now operating in the following markets: Canton, Cincinnati, Cleveland, Columbus, Dayton-Springfield, Lima, Toledo, and Tri-State area. No other State in the Union has such a high percent of participation in the Federal milk-order program as Ohio, and any change in the operation of this program would be of great concern to Ohio dairy farmers.

It seems to us that the self-help features of the Federal order system-where the costs of the program are paid by the dairy industry itself-are in line with the policies now being advocated for our national farm program. We feel strongly that the whole problem of the dairy industry would be more acute at this time if Federal milk orders were not in operation throughout the Nation in some 49 major markets.

Producers in Ohio have benefited greatly, and consumers have not been hurt, as a result of the operation of the Federal milk orders. We also believe that Federal milk orders have not served as a barrier to the movement of milk, as Ohio imports milk and exports milk, and no hindrance in the movement of milk has been observed as the result of the operation of Federal milk orders in this State.

The contention that "high prices" under Federal orders in New York and other eastern markets has unduly contributed to the surplus milk production is not borne out by facts, as fluid-milk production has increased in similar amounts in midwestern areas. Federal orders are sometimes used as a scapegoat to divert attention from the real causes of marketing problems.

We believe that Federal milk orders provide a stabilized industry with a minimum of Government interference and a maximum of farmer freedom. We need more of this type of program in our farm marketing.

We hope through these hearings we will be provided with a program that will give farmers the minimum of Government interference and the maximum of farmer freedom. Thank you.

Mr. DAGUE. Thank you, Mr. Mapp.

Mr. Ralph Tugend? Following Mr. Tugend will be Mr. Norton Woods.

STATEMENT OF RALPH TUGEND, RFD 1, JEROMESVILLE, OHIO

Mr. TUGEND. I am Ralph Tugend, a farmer, of Ashland County, and with our son and son-in-law just returned from Korea, we operate a 320-acre dairy farm along with some other livestock. We keep from 60 to 70 or 75 Holsteins and about 100 ewes and market from 100 to 150 hogs a year. We ship about 1,000 pounds of milk per day for the Cleveland market. I have been doing that since we have been in the partnership.

One thing I would like to bring out to the committee today is the shift of so many farmers to part-time farming. We are situated in a place near Mansfield, a rather large industrial city, and many of

our farmers are working a shift in industry today. This is not very conducive to a good livestock program because if you are doing a good livestock job you must be on the job most of the time.

This, along with a support price for grain and not on livestock or their products, I think in time will change the eating habits of our Nation because we have seen that happen in many countries, and we see their sorrowful condition today, under which they exist. Their standards of living are much lower than ours. The number of the animal units that they have is very, very small. I think that we should think well of this problem before we continue a support program for grain and not for the animal livestock and their products.

Then we talk about our great surplus of, you might say, perishable products. Yet at the same time we hear so much of hungry people in the world. Do we really have a surplus? That is the question that is uppermost in my mind, when we take into consideration the world. today, whether we really have a food surplus.

We know that many countries, as soon as we want to export some of our foodstuffs, object to us taking their market. But the people that are hungry and on the verge of starvation, I don't believe that they could be classed as a buyer of any one commodity because if they were they would have a better diet and they wouldn't be on the verge of starvation as they are today.

Just recently the Government released a quantity of dried milk to the churches for them to distribute. I wonder sometimes whether we have made enough effort to try to dispose of the surpluses we have today. I think this is a very good gesture. We happen to belong to a small rural church of 150 members in the Sunday school. We voted to give one Sunday's offering to the distribution of this milk. The offering amounted to $101 from a church congregation of 120 members and about 150 in the Sunday school.

It looks to me-of course we are dairy farmers, remember we are trying to get rid of our product-but it looks to me as though the people are back of that kind of a program. We hear continually of the hunger in the world. My son came back from Korea just recently, serving a year over there. He said in certain sections the man who owned 12 chickens was considered wealthy by his neighbors. We are not wealthy here with 12 chickens.

I thank you.

The CHAIRMAN. Thank you very much, Mr. Tugend. We will next hear from Mr. Norton Woods. Following Mr. Woods the next witness will be Mr. Paul W. Walter.

STATEMENT OF NORTON WOODS, OF MAUMEE, OHIO

Mr. WOODS. Chairman Hope and members of the House Agriculture Committee, my name is Norton Woods. I live in Lucas County, 6 miles from the Toledo City limits. I own 190 acres of flat, fertile, silty clay loam. In partnership with my son, I operate this farm and some small adjoining pieces of land owned by men who work in Toledo. Part of this land has been in my family over 100 years.

We conduct a strictly crop-farming operation. We have been forced to drop all forms of livestock because we cannot compete with city wages for the labor such operations require. So my remarks will be made strictly from the angle of a producer of field crops. I am making several assumptions: