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ported, there should be compensating measures provided for poultrymen, such as preferential feed prices.
I believe that the Government can continue to be very helpful in serving agriculture's needs without engaging in price support and subsidy. The following are suggested means of assistance, and this list is by no means complete:
(1) Increased agricultural research aimed at increasing economies and efficiencies in the production and distribution of farm products.
(2) A continuing program of sound soil- and water-conservation practices, preferably under one agency, encouraging a maximum of initiative on the part of individual farmers.
(3) Market expansion through increased utilization and improvement of marketing standards and consumer education activities focused on the upgrading of the diet, giving consumers full appreciation of high nutritional values.
(4) Through analysis and watchful regulation of transportation rates so important in the cost of producing and marketing agricultural products, with due consideration for their effects upon consumption habits and production trends; upon the location and extent of processing; and upon the development of the food industry.
(5) Improvement of the price-reporting functions of the United States Department of Agriculture to fully reflect prices in accordance with quality of production and to insure sound trading levels important to producers and consumers alike.
(6) Maximum Government assistance given to the efforts of private industry in developing a sound foreign marketing program. I appreciate this opportunity to appear before your committee to express my views, which, fundamentally, are opposed to direct Government support and subsidy activities affecting agricultural production and distribution, and are in favor of Government assistance only to the extent of providing specific emergency aid on a disaster-insurance basis. I believe that the Government's role should emphasize research and information programs and activities.
The Chair was informed earlier this afternoon that Mr. George S. Sehlmeyer had filed his statement and did not desire to be heard. I understand Mr. Sehlmeyer now wishes to be heard. Will you step forward, please?
STATEMENT OF GEORGE H. SEHLMEYER, MASTER, CALIFORNIA
STATE GRANGE, SACRAMENTO, CALIF. Mr. SEHLMEYER. Mr. Chairman and members of the committee, my name is George Sehlmeyer, master, California State Grange. I was just leaving when you called me. • We would like to present a program here today, and it is time, we think, that we completely analyze the farm program.
The present one, it has been our opinion, is wholly unworkable. It is resulting in crushing the small family farmer out of existence.
We think one of the first steps to get away from surpluses—we will not get away from surpluses with flexible price controls.
The first one its to put a limit on how much one producer can receive under the parity payment. Under the present program one producer in California last year received $1,200,000 in parity payments on his cotton crop, and it has been reported in others, in one 'area, one man borrowed $2,500,000 to raise cotton. He was not a cotton producer; he was a speculator.
Until we get rid of that surplus and build up from large operations depending on the parity payment of fixed prices, you are going to have more and more surpluses.
The CHAIRMAN. Now, Mr. Sehlmeyer, in that connection would you make a distinction between the man who actually produces the cotton himself and the banker that you have just mentioned.
Mr. SEHLMEYER. I would reduce it all across the board, that is, the parity payment. He can produce all the cotton he likes, all the wheat and all the tobacco, but the unlimited payments under parity have resulted in increasing and continuous surpluses.
We think, too, Mr. Chairman, one other step that the dairy and poultry industry should be put on the same parity level as feed grains.
I think, if I recall, wheat grains stand at 85 percent of parity, and the dairy and poultry are down at 75 percent, placing them in a very unfavorable economic position.
The CHAIRMAN. You say you are against the present program. How would you attain the end which you recommend ?
Mr. SEHLMEYER. First, I would put a limit on the amount any producer can receive under parity payments. That is not in the program now.
Then I would lift dairy and poultry products to the same level as feed grains to put them in an economic position where they can go on.
Dairymen have the habit, if they find themselves losing money, they buy a few more cows and try to make up their income that way.
Another thing, I wonder some times, Mr. Chairman, how much longer these consumers of this country are going to tax themselves billions of dollars to buy farm commodities off the market, store them in order to have to pay a higher price to get them back?
If we suggest that two commodities be an experiment, the dairy and the poultry industries, to universally be allowed to flow into the market unrestricted; let them reach whatever level they please at the market place, and if they go lower than parity level, let the Government pay, not to the processor or handler, but to the producer, the difference between level and the market price.
The CHAIRMAN. That would be the so-called Brannan plan, would it not?
Mr. SEHLMEYER. Well, I think, Mr. Chairman, you may put a little different coat of paint on it, you may change the shape a little bit, but sooner or later this country is going to come to something like that because I think when the consuming public find out what they have been doing, they will request that at least the production of Americau agriculture be available to them.
We think as far as our survey goes, and I think it is not altogether complete, that it would cost the Government less to do that than it would to have some other program.
Some other points, at least I am suggesting, Mr. Chairman, result from the convention held in Sacramento attended by 3,500 people. They adopted this program.
We think it would be very advantageous all along the line, if we would have an all-out congressional investigation of the relationship of farm income to the consumer's dollars.
That, Mr. Chairman, is the sense of my statement. The CHAIRMAN, Thank you, sir. (The prepared statement of Mr. Sehlmeyer follows:) The California State Grange is a general farm organization having members in nearly all parts of rural California. The program which our organization must follow is adopted by an annual convention attended by representatives of both county and local organizations. During the 1955 annual session, held in the city of Sacramento, October 18 to 21, inclusive, among other declarations, a four-point program for California and American agriculture was unanimously adopted.
1. A limit should be placed on the amount any one producer can receive in parity payments under the present farm program. Under the present law the unlimited amount any producer can receive has resulted in rapid expansion of the so-called basic commodities. In some instances these producers are not farmers but speculators. Further the present unworkable parity program is proving detrimental to the homeowner type of farmer and if not corrected, if present trends continue, the number of homeowning farmers will continue to diminish. One of the great bulwarks of American democracy is communities where people live and take interest in community affairs. According to information received, during this year, one producer in this State received $1,200,000 in parity payments. It is our opinion the farm program was never intended to make it possible for any producer to receive such large sums from the Government. If a limit is placed on the amount any one producer can receive, it will prove the most effective means of reducing farm surpluses. Such a law should be enacted without delay both in the interest of reducing farm surpluses and protecting the interest of the homeowning farmer.
2. Dairy, poultry, and livestock producers should be placed at the same parity level as so-called basics which include feed grains. Under the present program dairy, poultry, and livestock are in a very unfavorable economic position due to the fact feed grains have a parity of 8242 to 90 percent while dairy, poultry, and livestock are at approximately 75 percent of parity. It can readily be understood why the producers of these commodities are experiencing financial difficulties due to the unfair parity levels which are now in force.
3. It is recommended two commodities which are universally used be allowed to flow into the market unrestricted and if the market price is lower than the parity level, then the Government pay the producer the difference between parity and the market price. We believe such an experiment will readily prove that such a program would be less costly and at the same time would make the production available to consumers. Under the present program taxpayers, including consumers, pay large sums in taxes to buy commodities off the market, then pay a higher price for them in the market place. The present program of purchasing farm commodities by the Government, placing them in storage, which in some instances has resulted in deterioration, causing heavy losses, is neither sound nor workable and is detrimental to both producers and consumers. This suggestion to some extent parallels the Brannan plan, with the exception a limit should be placed on parity payments.
4. There should be an all-out congressional investigation of the relationship of farm income to consumers dollars. Information so far received indicates notwithstanding livestock producers suffered a very substantial drop in prices, the consuming public did not benefit to a degree which corresponds with drop in price to the producer. Not only would such an investigation prove of great value to both producers and consumers, but could easily result in making information available which would expose some of the apparent inequitable income of agricultural producers as against the prices paid by the consuming public.
We believe the so-called food bank would not only be practically unworkable; it would prove very costly. To pay farmers rental on idle acres certainly can never be recognized as a sound economy. While some suggestions there be greater research and increase in foreign exports have some merit, this will not remedy the present unfavorable economic position of American agriculture. The steady decline of farm prices should be a warning this condition must be changed.
The four policies outlined above would reduce surpluses by limiting parity payments, will place dairy, poultry, and livestock in a favorable economic position with other commodities, and allow two universally used products to flow into the market unrestricted. The plan outlined above is not only advantageous to producers but consumers as well.
The California State Grange most respectfully suggests this program be given favorable consideration during the coming session of Congress.
The CHAIRMAN. Is Mr. Long present ? Mr. Frank Long?
The CHAIRMAN. Mr. Long, I note you have a statement there. Would you want to file it and highlight it?
STATEMENT OF FRANK LONG, FRESNO COUNTY CHAMBER OF
COMMERCE, FRESNO, CALIF. The CHAIRMAN. Give us your name in full for the record and your occupation.
Mr. Long. I am Frank Long. I am a farmer and I am from California.
Mr. Chairman and all the members of the Senate Agriculture Committee and distinguished guests, it is certainly much more than just gratifying to the folks in California and particularly to we in the San Joaquin Valley, who are having the honor of being your hosts on your visit and your attempt—which I hope will be successful, in finding and putting into effect a solution to the national agricultural problem and all of us who are here with you today want to be helpful to you in finding that solution.
First, I think it is necessary to take just a little of the time you have allotted me, to explain the thinking and effort behind our proposal for an entirely new approach to the farm problem.
When the secretary of the agricultural committee of the Fresno County Chamber of Commerce requested a spot be given for their suggested plan on the day's agenda, he received in effect, a reply that you folks were not too interested in listening to anyone other than farmers: Well, to clarify the chamber's interest in this matter I want to say the suggestion for a farm plan was thought out, with others helping, and written by a farmer-an American farmer-one who has farmed all his life.
It was then given to the agricultural committee of the chamber for their study and consideration and on October 31, 1947, it was adopted by the board of directors as a farm program which they could vigorously and conscientiously support, and I am very proud that I have had the opportunity to present that program three different times to congressional committees, and now to your own Senate Agriculture Committee.
Now I want to explain just a little why we believe it is necessary to have a completely new farm program.
We have in this Nation 3 things and 3 things only, that make our national economy; they being industry, labor, and agriculture, and when all three are considered and treated equally, and are equal, we have a sound and stable national economy. But as of today industry has the protection of fair-trade practices, labor has its minimum-wage law and with our high standard of living, those commitments to industry and labor, in my opinion are not only justified, they are American, but please remember, of the 3, agriculture, is the barometer for the other 2, and if not treated as an equal, with a parity income comparable with industry and labor, our whole economic structure collapses
The CHAIRMAN. What would become of industry and labor if the farmer should get out of business?
Mr. LONG. That is what I am going to tell you.
History has proven that as a fact; the last collapse occurring in the memory of most everyone in this room, and right now we are again in the same trend, and the pattern is exactly the same; stocks and bonds, and paper profits going up and up, and the prices received
repeating ture for farthe past hal
late me the biggest programs, in fact same number
by agriculture going down and down, and the Agriculture Department repeating almost daily that farm prices have taken another drop, but, the future for farmers is very bright-just when I wonder.
Statistics show that for the past half century, for every new dollar in wealth produced by agriculture, 6 more are created in national wealth by the turnover in circulation, so just how long can national economy last with only 2 of our economic segments showing prosperity.
In the last 20 or so years we have had 5 different Department of Agriculture Secretaries and about the same number in different kinds of so-called farm programs, in fact the name "farm program" has become the biggest political football this Nation has ever seen, and lately it has seemed to have settled down to a fight between parties, 90 percent parity supports on one side, as against so-called flexible parity by the other, and neither one has solved our farm problems.
It is my opinion they never will or can, because the 90 percent gave quick birth to a large number of speculators, who quickly became suitcase farmers that could smell a quick dollar by leasing or buying large acreages of land which had in most instances never been farmed before to basic crops.
That action did much to build huge unmanageable surpluses. Then another Secretary took over who evidently got the impression that the less farmers received the more they would have, with the theory that if the price-parity scale was low, farmers would not raise so much, and surplus supplies would disappear, but the records show that surpluses under the sliding scale are greater today than they were yesterday and now the Department of Agriculture seems to have finally come to realize that you can't have a sound national economy with falling farm prices, so they have come up with another farm-program experiment with a find sounding and catchy name, soil bank, whereby land rented by the Government would be taken out of basic crop production and planted to grasses so more livestock could be produced.
You know, I just can't stretch my imagination enough, to believe that a program which would greatly increase the difficulties and would likely cause disaster to the livestock industry, could in any possible way be acceptable to the producers of livestock.
Propaganda out of Washington informs the public almost daily that it is not low prices that is hurting farmers, but it is the price squeeze that is causing the trouble, that prices the farmer has to pay are too high, and wages are too high, and the impression I get from such releases is that someone wants prices and wages lowered to level of prices now being received by farmers.
Gentlemen, you just can't have a stable national economy with falling income and certainly every farmer and forester knows you can't improve a grove of trees by cutting the large and thrifty to the level of the lowest trees in the grove.
And I am certainly sure if we are to continue with the high standard of living, and a way of life with profit, which industry, labor, and agriculture has built over the years for the people of this Nation, then I am of the opinion the fair-trade laws for industry and minimum wage laws for labor are necessary but it is also mandatory that