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farm program cost no more than a hot fudge sundae for the average American taxpayer. That was in 1952.
Let us examine what has happened to a successful farm program. It is falling apart. The new Secretary of Agriculture has spent $3 billion in trying to hold up sagging prices, in the last 3 years.
While this has been going on, there has been a campaign to convince the American people that the American farmer was a millstone around the neck of the taxpayers. In the last 5 years, $6 billion have been given as subsidies to American businessmen.
We read just yesterday that $500 million that the American taxpayers pay for the cost of the Post Office Department is going to be collected in a new manner. They are talking about raising the postal rates from 3 cents to 4 cents. Do you know where that $500 million goes? It goes to the use of second- and third-class mail. That is one of the groups that is getting that $6 billion subsidy.
It is my belief that the remarks of the Secretary of Agriculture with respect to his intention concerning agricultural programs and the propaganda directed to the cost of the price supports has done nothing indeed to stabilize our wobbling agricultural income. In fact, it is my sincere belief that the primary responsibility for the collapse of farm prices these last 3 years can be laid at his doorstep. He should not be perplexed that he is required to pay in 3 years nearly twice the entire expenditure of the previous Democratic administration during
(A cry of “politics” from the floor.)
Mr. STEINBERG. Every time the Secretary or one of his assistants has made a speech on farm price policy, prices have dropped. Their actions have signaled a change in trend. This is the point I am trying to leave with you. There has been a change in trend of major significance in the markets, the psychological attitude of buyers and users of farm commodities. And I refer to the packers, the processors, the traders, the manufacturers, and the middlemen. The point I am making is that that both buyers and sellers have lost confidence in the desire of the Government to stabilize price supports. When that happens, laws and statutes will not prevent a devastating erosion of prices.
Ủnder the previous administration, it was clear that the rigid price support program was being enthusiastically and vigorously administered. Everybody knew where the administration stood.
It is my sincere belief if such an attitude had prevailed in the last 3 years we would be sitting with a program that was successful and was still uncostly.
I would like to document my case with three little examples here.
During the last 3 years, buyers have adopted the practice of day to day procurement. Never knowing how far down is down under a parity system of sliding scales. Thus, for example, I am going to quote a very respected publication, the Commodity Futures Market Service Letters. Those letters and other grain and trade papers have reported time and again the bearish attitudes on the part of the buyers which seem to follow the inept remarks of the Secretary. Such a letter on cotton, dated September 17, 1953, reported:
Speculative demand is very small and some concern is evident that Secretary of Agriculture Benson, in his speech Saturday, might upset the applecart inso far as confidence in the present price support program is concerned.
A grain letter reported also in 1953:
Early in the session of the Chicago Board of Trade) there was scattered buying of wheat futures prompted by the rumor that Secretary Benson would soon resign * * * a selling flurry late in the session followed Secretary Benson's denial that he contemplated resigning.
Last month a Wall Street Journal reported that Secretary Benson was "searching for ways to lower cotton support prices." Almost immediately the 1956 futures dropped 3 cents a pound.
My point is that political attitudes play a large part in instilling confidence or "backbone" in buyers.
I do not hesitate to predict that if Secretary Benson were to resign tomorrow or to be removed you would see overnight a major rallying in all commodity prices, and confidence in agriculture, not only in America but the future of agriculture throughout the world would receive a new vitality.
The Secretary of Agriculture has a morbid fear of abundance. And, indeed, in America today that is the greatest fear we must overcome. The entire dairy surplus of the United States could be disposed of.
I will tell you how something could be done.
We have 38 million schoolchildren today. If each had 2 pints of milk a day, 30 weeks a year, 5 days a week, the entire surplus would be gone. Today, however, only about one third of our children in American schools enjoy the school lunch program.
The CHAIRMAN. May I say to you that we have a program.
The CHAIRMAN. We have offered the milk but some communities would not take advantage of the program, and administer it as intended.
Mr. STEINBERG. That is correct, sir. It is not the fault of people in Washington.
The CHAIRMAN. You cannot then say that the program has not worked if the communities fail to take advantage of it.
Mr. STEINBERG. The program is an excellent one. I advocate it and more money for the program, an education to encourage all localities to use it.
Our products, such as raisins, surplus of animal products, should go into the school lunch program.
Lord Boyd-Orr, the first Director of the United Nations Food and Agricultural Organization, said recently that it would take 10 to 12 billion dollars worth of food to relieve the hunger that is actually prevalent in two-thirds of the world. He said something even more significant to me. He said:
That is the lowest sum that can relieve world hunger, and if food is not provided, then hungry people ultimately will pull down all the rest.
I believe that the administration has failed dismally in the use of existing legislation and in recommending new proposals to find customers in Africa, the Middle East, and in Asia. American food in those areas could do more to halt the spread of communism than the sale of our A-bomb or H-bomb.
The CHAIRMAN. How would you handle it-would you want to give it to them? Do you not think that we would make them wards of the United States if you kept on feeding them? Would it not be better to give them a way whereby they could produce food themselves?
Mr. STEINBERG. Yes, I feel that a new look at the geopolitics of the world is essential if we are going to solve the problems in America and in the world. We must face up to what is coming to be known as the atomic era. When 134 billion people in the world live on less than 25 cents a day, how else can they turn but to the spreading propaganda of communism? Our answer is in the technical assistance programs, whether the honorable chairman likes them or not; I feel that by the year 2000 we are going to have a world of totalitarianism or a world in which democracy can't thrive.
The technical assistance program is the only sound answer to Russian communism.
I feel that no testimony such as mine which has been vehement should not in conclusion offer some constructive criticism and some definite recommendations.
Therefore, I submit the following:
We must adopt a sound farm program which will consider the long-range ability of our farmers to feed our growing population effectively to strengthen the economic position of the farmers and the rural communities.
Our farm program must recognize and account for all segments of the farm population; the family-sized farms, the larger commercial farms, trade. It must provide and consider the owners, the operators and the workers of American farms regardless of whether they grow the staples or the perishables.
I wish to close with the following points:
1. That marginal land brought into cultivation to provide for our war emergency be returned to grassland and to forest. Any money spent on such conversion is money spent on the future wealth of this Nation.
2. That the Congress should encourage the administration to utilize our food and fiber surpluses as weapons to be used abroad in the fighting of communism.
3. That the Congress extend the 90 percent of parity support program for basic crops through 1958, and promptly enact legislation to aid farmers of perishable crops by the extension of compensatory payments to them.
That the Secretary of Agriculture use all available section 32 funds to alleviate the distress in perishable crops, and not return the same to the Treasury as he has done in the past. One hundred million dollars of such funds were available, and he declined to use them to assist the distressed farmer in the past 12 months.
5. That the farmer on the family-sized farm have additional lowcost credit other than disaster credit.
6. That the Congress reestablish the Federal food stamp program to dispose of the surplus foods while at the same time raising the dietary level of the undernourished children, the aged and the handicapped, and the underprivileged.
7. That Congress reassure the people by proper legislation that the Rural Electrification Administration's functions will be carried forward and not sabotaged by the administration.
8. That the Congress take such action as may be necessary to reactivate and broaden the Federal crop-insurance program in order that the farmer finally may be protected from the disaster of the loss of crops.
9. That Congress appropriate additional funds for the expansion of the school-lunch program.
10. That Congress appropriate necessary funds for the undertaking and completion of the San Luis Division of the Trinity project urgently needed to supplement the water supply of central California farms; and that the Congress adopt and follow such policy and enact such legislation as may be necessary to develop such projects elsewhere in our land as they may be needed.
11. That the Congress revitalize and appropriate adequate funds for the expansion of the technical assistance program for aid to underdeveloped nations, particularly in respect to the employment of our own farm surplus in those areas.
12. That the Congress undertake a thorough investigation into the incredible and increasing spread between what the housewife pays for her food in the retail market and what the farmer receives for the same product harvested from the farms.
13. That the Congress support the United Nations world reserve of food with adequate funds and such contributions as may be necessary to maintain it.
One last remark in closing, Mr. Chairman. There are those that grow cotton in California and in the South that fear cotton production in Mexico. There are automobile workers in Detroit that fear the production of automobiles in South America. Let us pinpoint this in one single manner. If the 134 people of the world living on $2.50 a day were given 1 decent outfit of clothing or a cotton mattress to sleep on, we would automatically open up markets for 25 million more bales of cotton, and we are worried about a production of 14 million bales of cotton in the United States.
I thank you kindly for giving me this time. I know that your presence in California will lead to great improvement in the situation of California farmers.
The CHAIRMAN. Thank you. (The prepared statement of Mr. Lionel Steinberg is as follows:)
I wish to join other San Joaquin Valley farmers in bidding you welcome here, and to express my appreciation for inviting us to state our opinions and views on farm policies for your consideration.
My name is Lionel Steinberg, my address Post Office Box 1107, Fresno. I am chairman of the Fresno County Democratic Central Committee, and vice chairman of the California Democratic Farmers' Advisory Committee. I grow, pack, and ship fruits and vegetables, and I grow cotton and grain in the San Joaquin, Imperial, and Coachella Valleys. I earn my living from farming.
Aside from my personal interest, it is clear to me, as it is to everyone, that agriculture is one of the most basic of all the pillars upon which rest our great economic and military strength. It is so important that at least 2 out of every 5 Americans gain their livelihood directly or indirectly from agriculture. Therefore, farming is an element of our economy and of our social structure which cannot be taken lightly.
The American farmer's efficiency is the envy of the world. He has produced an abundance of food and raw materials for the civilian and the military alike; and he has furnished immense quantities of food to prevent the starvation of our war-ravaged allies abroad.
Our agriculture, however, has not always been so productive. Actually, in 1800, 85 percent of our people were engaged in producing food. In 1910 the situation was so improved that farmers constituted only 35 percent of our population. Today, only 13 percent of Americans live on farms.
We had always the natural resources and the climate, and the industrious spirit of a people upon which a great agricultural economy could be based, but it was only when our Government and our people undertook with enthusiasm the practices of soil conservation and replenishment, and of pest control and seed and breeding improvements, and the sensible marketing of the farmers' product, that our agriculture grew strong. While we were adopting the intelligent policies of the past 20 years, we were at the same time reclaiming lands lost to the farmer for want of water and by floods and erosion. As World War I came to an end, the farmer of America enjoyed a brief era of booming prices for land and farm products which lasted until the summer of 1920. Then came a debacle of tobogganing farm prices and land values.
In 5 short years, nearly 1 million farmers went broke. Agriculture did not share with industry the prosperity of the roaring twenties. So very severe was the situation that in July of 1922 a National Agricultural Conference was convened in Washington to discuss the crisis. At that conference, then President Harding told the conferees: "It cannot be too strongly urged that the farmer must be ready to help himself.”
At the same time, high tariffs and virtual embargoes on many commercial imports aided and protected the industrial segment of our economy, and the trader. Then as now, the farmer-patient was sick, but the doctor's advice was like Secretary Benson's: "Help yourself."
In the interval between 1924 and 1929, the productivity of our average factory worker increased by almost 20 percent, but his pay rose only about 3 percent. In the long run, the factory worker and the farmer eventually came to suffer a similar position of degradation, and America suffered one of the worst catastrophies in our Nation's history. The Great Depression of 1929 was upon us, and prices fell to unbelievable depths. Wheat brought the lowest price in 300 years; corn sometimes less than 10 cents a bushel ; cotton and wool went as low as 5 cents per pound; pork and beef animals were at about 3 cents, and raisins in Fresno were less than 1 cent per pound. At that time the average farmer's income was about 75 cents per day.
A study of our agricultural history, particularly that of the Great Depression, reveals the utter fallacy of Secretary of Agriculture Benson's theory that lower prices eliminate farm surpluses. When prices were low farmers mined their soil in a vain endeavor to keep their property. Agriculture never once slowed up the production process. Farmers kept on increasing production while industry kept on firing. Steel production went down 85 percent, prices down 1 percent; cultivator production down 90 percent; prices down 3 percent.
Not only during the depression, but during the whole 12 years prior to 1933, the farmer was one of the forgotten men of the American economy. Then there was a change. A strong Government program commenced in 1933 to help farmers back to a position of self-respect and stability. This program included soil conservation, reclamation and flood-control projects, farm credit, crop insurance, rural electrification, farm housing loans, storage facilities, and the parity concept with high price supports guaranteed by law.
Broadly speaking, the major factor in the improved condition of agriculture was the willingness of the executive and legislative branches of the Government to provide adequate governmental programs to serve agriculture and the whole people through legislation and appropriations. The results of governmental action since 1933 enabled agriculture of the United States to tackle and to perform successfully every task the Nation has given it. When World War II ended the American farmers kept on producing enough so that food was able to become a major instrument of United States diplomacy. It was an instrument that did more than armies could have done to keep communism from dominating Western Europe.
Today, however, a Republican administration has returned to Washington and with it has come the beginning of another great farm depression.
In 1952, President Eisenhower campaigned throughout the country, and even visisted the San Joaquin Valley where, here in Fresno, on the courthouse steps, he promised not only the continuation of 90 percent of parity for our basic crops, but 100 percent. He went even further: he included the producers of the specialty crops within the light of his promises. It, therefore, was a shock to farmers in general when, upon taking office, the President appointed Ezra Taft Benson to be Secretary of Agriculture. He placed in that position of great importance to the farmer a man whose views were then, and are now, known to