production, probably due to the fact that the foreign peoples are inherently rural minded.

The CHAIRMAN. Mr. Bender, I do not want to go into too many details, but I can certify from personal knowledge that you are correct. I have had the privilege of visiting every country in this world but 2 in the span of 7 or 8 years, and the technical aid program, as such, does not do too much harm, but it is when you implement it with the economic aid, and not only teach them but have our people do the work for them and furnish the tractors, the machinery, and what have you so they can carry it out, that we get into trouble.

Mr. BENDER. That is right.

The CHAIRMAN. I just returned from Korea; less than 4 weeks ago I was on the battlefield in Korea flying over the whole country, looking down, and you would not say that a war had ever occurred.

But in that country we have today over 200 technicians trying to find ways and means of balancing agriculture with industry, when you have hardly anything to work with except the agriculture.

I found that they have never produced food and livestock more effectively, in their entire history, than they are now producing through our assistance.

We built them four little flour mills to be operated by the Govern'ment. We built them four pharmaceutical establishments, to be owned and operated by the Government. Our money was used for that. In Formosa we helped to build a big oil plant. It is in operation now. We are furnishing not only the plant, rebuilt it, but we are furnishing them the oil. They do not have to pay for the oil, and they sell their product on the island.

Now, those are just a few minor examples of what we have done, and for the past 3 years, some of us have been at the forefront trying to cut down these vast expenditures abroad so as to save our own economy here. Somehow nothing has been done. We have lost.

For example, take your industrial production in Western Europe, the program was intended to increase production to 125 percent of the prewar level. Today it is 156 percent prewar, and we are still there helping.

If something is not done soon, we are going to bring to our own country what we are fighting against now, and that is some kind of "ism."

When I first came to Congress, only 19 years ago, the entire amount of money necessary to operate every department of Government was only $400 million more than is now required to pay the interest on our debt, and any man with commonsense knows you cannot keep that up.

You may proceed. [Applause.]

Mr. BENDER. That was the point we were making, Senator, that we must come to recognize the situation we are in and get our sense of values adjusted to that.

The CHAIRMAN. We are going to use some baseball bats on some of those fellows on the Washington level next session.

You may proceed.

Mr. BENDER. The point in submitting these figures is simply to emphasize the fact that we must carefully examine our entire agricultural economic structure and attempt to establish a workable

agricultural land policy which will provide food and fiber for domestic use and foreign export to such an extent as can reasonably be anticipated and at the same time provide sufficient elasticity to increase production as our population increases.

All of us who own land hold title to it during our lifetime but in the final analysis we are entrusted with the stewardship of this land for future generations both in rural and urban areas, and we must remember this in seeking a solution to our present problems.

With this in mind, would it not be good agricultural statesmanship after determining our domestic needs and the potential for foreign export, to take the land not presently needed for maintaining these present needs and actually work them as diligently for soil building as we do our other crops. And mentioned previously, we are all stewards of the approximately 400 million acres of cropland, and over a billion acres of range and pasture land entrusted to us as a nation, and whether we raise food, fiber, or other products, it all comes from our common source of national wealth and well-being, the good earth, and it naturally follows that good maintenance or improvement of this resource benefits every individual in our land, and continued recognition of this truth will spare us the fate that has overtaken so many civilizations who failed to properly care for the land entrusted to them.

It would be presumptuous on my part to attempt any detailed outline of procedure in establishing an agricultural land policy, but I would with all the sincerity at my command urge that no expedient be adopted that debases the dignity of the individual such as outright gifts or grants for which he is not required to render some really constructive service. If a man receives reimbursement for building soil fertility, he should be required to work at it as diligently as other farm activities and be paid a just wage for a construction service; the laborer is worthy of his hire and entitled to reimbursement for service rendered.

The CHAIRMAN. For what proportion of his land would you advocate that?

Mr. BENDER. That, Senator, would have to be determined on the basis of percentage of the surplus, shall we say.

The CHAIRMAN. You mean surplus acres to produce what we need? Mr. BENDER. That is right, sir.

As an illustration, suppose we are presently using 400 million acres in this cultivated land which is responsible for the surpluses. If the determination would be that 15 percent would have to be withdrawn, that is the percentage of the tillable land, not take the worthless land, we are talking about the land producing these surpluses, that is the land that would have to be used in this soil-building bank; yes, sir. The CHAIRMAN. Well, now, how does your plan differ from the plan of the preceding witness, Mr. Hammond; you heard him?

Mr. BENDER. I have never conferred with Mr. Hammond personally to get the details.

The CHAIRMAN. But you heard him, did you not?

Mr. BENDER. Yes, sir.

The CHAIRMAN. You heard the questions we asked of him?

Mr. BENDER. Yes, sir.

The CHAIRMAN. How does your plan differ from his?

Mr. BENDER. To this extent, perhaps, that there is an inference there, perhaps I am mistaken in it, but there is an inference that we will say, "You withdraw 15 percent of your land from this active cultivation." There is an inference that if you plant that in grass, like legumes or other soil-building crops, you could place livestock on it, or something of that sort.

I do not contemplate in this program that we do anything of the sort, because you are merely shifting from one surplus commodity to another, because instead of grains, then you will shift to a surplus

in wheat.

Senator EASTLAND. I did not understand him to say that. I understood 150 acres would be retired.

Mr. BENDER. I may be mistaken, too. I would like to confer to make sure that we are right in that. That is the way I got it. If I am mistaken, the other thing, perhaps, might be this, if you retire 15 percent and merely leave it lie there idle, without doing anything, it could very well by erosion of one form or another come to lose its value.

My philosophy is that, instead of leaving it laying there idle, if we are going to pay for this, then we should require the person retiring it to plant or place thereon a soil-building crop, and return it all.

The CHAIRMAN. The preceding witness did not offer any payment inducement at all, as I understood him.

Mr. BENDER. I am suggesting, sir, a payment for this service with the understanding that the service must be rendered for it.

Senator EASTLAND. I think that is the principal difference.

The CHAIRMAN. That is the principal difference. What would be the amount of pay you would suggest? You have got to get some kind of an estimate, sir.

Mr. BENDER. Yes, sir. Again to use a blanket figure, for every piece of land, frankly, that is not practical.

The CHAIRMAN. Let us relegate it to the acreage that is to be in cultivation.

Mr. BENDER. Assuming it is good, cultivated land.

The CHAIRMAN. That is right.

In other words, it is the only one you would want to get out. The other you would not pay anything on?

Mr. BENDER. That is right, sir. It would merely have to be a percentage of what this farmer is earning on his land at the present time. If he has been growing wheat and his return on that acre wheat is bringing, say, $30 or $35 an acre, as it might be, we could not, of course, pay him the entire cost of what he would get for that wheat on the same basis as you pay for fire insurance for a loss, but, certainly I would say that it should be on the basis of, oh, possibly as high as 50 percent of that, in order to make a living available as has been pointed out by one of the previous witnesses.

Senator EASTLAND. You would pay him more than his cost in breaking the land?

Mr. BENDER. Yes.

Senator EASTLAND. Of putting it into legumes and turning it under? Mr. BENDER. That is right, sir.

Senator EASTLAND. What formula would you use then?

Mr. BENDER. For determining his payment?

Senator EASTLAND. Yes.

Mr. BENDER. I think that I would use the formula of taking his earnings from that particular piece of ground as the basis for computation, and then use a percentage of his normal earnigs on that particular piece of land.

Senator EASTLAND. Suppose he had been losing money on it?

Mr. BENDER. Well, of course, we realize that over a long period of time it is understood he has been raising crops on it.

Senator EASTLAND. What period of time would you take?

Mr. BENDER. Well, in this particular area we have been having a rather serious drought condition in the Southwest here for about 5 years now, and we would have to go back beyond that period, apparently, in some areas at least, to determine what is a reasoably normal year.

The CHAIRMAN. If you produced wheat at $35 an acre cotton, of course, would be considerably higher.

Mr. BENDER. That is right, sir.

The CHAIRMAN. But assuming $15 per acre, on 50 percent of 4 million acres, that would cost the Government almost a billion dollars. Do you think that we could get the Congress to appropriate that?

Mr. BENDER. Well, Senator, we have this in mind at the present time, whether we have withdrawn this acreage or not, the taxpayers are still paying for the storage of these surplus crops, and the indications are that we are going to continue to pay sizable sums every year. And we can see no end to this.

The CHAIRMAN. I think that has been so exaggerated that I am just going to read it into the record here, but I will say this because we do not know what the future holds. On the basic commodities, the entire losses, according to the records from the Department of Agriculture, from October 17, 1933, through June 30, 1955, has been $392,648,091, and that is over a period of over 20 years. That is all it is. [Applause.]

The CHAIRMAN. Now the program you envision here would cost $900 million per year.

Mr. BENDER. Senator, on this I think perhaps I had better read the next point, the next paragraph on that.

The CHAIRMAN. Proceed.

Mr. BENDER. It is realized that the inauguration and administration of such plan would present many difficulties but we would at least have formed some basis for establishing an agricultural land policy (This is the establishment, what we are working for this is probably costly to start with, but we have to make a beginning somewhere if we are going to have some sort of an agricultural land policy. If we make a mistake in this the first year, obviously, we will have to make readjustments, but this is in the thinking of these folks who have been terribly hurt all through the land, not just the Southwest, by this drought. They are going to have to have more aid now than they will as the program progresses.) and stabilizing to some extent at least, our agricultural economy.

We simply cannot continue to build surpluses and yet drive people from farms because they are unable to earn a living, without serious consequences to all of us and this is particularly vital in halting the loss of family-size farms as we realize that our national welfare is dependent to a large degree on maintaining as a bulwark against wars

or other economic crises this vast potential of trained manpower who have always risen to such emergencies in the past.

In conclusion I would like to pass on to you an observation made to me recently by a farmer having a Farmers' Home Administration loan. The recent drought years had created for him and many others in his area very difficult and trying situations, and although FHA Administrators for the most part were understanding and as lenient as regulations would permit, there were, nevertheless, a number of foreclosures; and suggestion was made that for its psychology, if nothing else, a clause be inserted in real estate loan agreements, that in event of catastrophic conditions such as drought, hail, tornado, and so forth, where annual payment could not be made, the term of the contract be extended for a period equal to that when the catastrophic condition prevailed, and that declaration of delinquency be not made which would preclude securing credit to carry on the following years opera

tion.

We believe that such a provision would do much to keep up the morale of a man when it was most needed.

The CHAIRMAN. Thank you, sir. Are there any further questions? Senator EASTLAND. No question.

The CHAIRMAN. At this point I wish to place in the record a telegram addressed to the committee, dated this date, from Samuel L. Kone, San Antonio, Tex.

(The telegram is as follows:)

SENATE AGRICULTURE COMMITTEE,
Washington, D. C.

SAN ANTONIO, TEX., November 5, 1955.

GENTLEMEN: I am an agricultural and livestock producer of 30 years operation. I submit for record the following statement. Existing surplus in agricultural and livestock products is the result of Government stockpiling in the war effort of World War II. There was Government stockpiling of many manufactured products, ships, airplanes, automotive equipment, munitions, et cetera. The Government disposed of much of its surplus equipment, but failed to dispose of the surplus in agricultural and livestock products. Leaving the surpluses as a barrier to future market prices of these products. So long as these surpluses exist agricultural and livestock production will not prosper. The immediate disposal medium of an ultimate consumer subsidy disposal program, or some other acceptable method.

SAMUEL L. KONE.

The CHAIRMAN. The next witness is Mr. George Ward, of Blooming Grove, Tex.

STATEMENT OF GEORGE WARD, BLOOMING GROVE, TEX.

Mr. WARD. Mr. Chairman, I am George Ward from Blooming Grove.

The CHAIRMAN. What is your occupation?

Mr. WARD. Farming, and the head of the ASC committee. They have been talking about cotton. We have lots of cotton allotments, but my people wanted me to come up here and tell you all that what we want is 90 percent of parity now. It may not be the answer to all the programs, but it is what we need right now.

The farmers in Navarro County are going broke fast, and what we would love to have is 90 percent of parity, and the two-price support on our commodities. I mean the two-price systems. And sell some of the surplus that we have got.