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direction. If it applies to wheat it can apply to tobacco and also to cotton.

Here is the difficulty. You talk about exports. Fine. What did we find out? Within the trade itself, in the small grains, some scandals developed. In wheat that was shipped from Commodity Credit stocks due to poor inspections and the injection of foreign material, when it got overseas what happened? When those people looked at it, we got the biggest black eye we could have possibly received.

Our Canadian brethren and others shipped good grades of their grains which made the foreign purchaser say "Why the Americans gyp us" and they charged that indirectly in their thinking to the great agricultural industry, when as a matter of fact, the wheat that comes from the combines and soybeans from the farms, it certainly does not have injection of completely foreign type of materials in it.

This was done within the trade in the country by some sharp operators who wanted to make a fast dollar. This is obviously an administrative problem.

Excuse me for being long winded but this is what I think.
The CHAIRMAN. Anything else?

Mr. KIMBRELL. Thank you very much for the opportunity to appear. We like to repeat, the banks are interested in this and we recognize the farmers are not asking for guaranteed annual wage and are not on strike. They are simply asking for just a reasonable slice of the economy. We think their position is reasonable.

Thank you very much.

The CHAIRMAN. Mr. Bazemore, do you have anything?

STATEMENT OF GEORGE H. BAZEMORE, GEORGIA BANKERS ASSOCIATION, WAYCROSS, GA.

Mr. BAZEMORE. He was our spokesman.

The CHAIRMAN. Do you agree with what he stated?

Mr. BAZEMORE. Yes, sir, and I would add we are fully in accord with Mr. Wingate's soil bank if he would just add some pine trees in there with that.

Mr. WINGATE. It is in my recommendations. I didn't get it in there but it is there.

The CHAIRMAN. Mr. Sam Nunn.

STATEMENT OF SAM A. NUNN, MACON FARMERS CLUB, MACON CHAMBER OF COMMERCE, PERRY, GA.

Mr. NUNN. Mr. Chairman, my name is Sam A. Nunn. I am here as a representative of the Macon Farmers Club which is the agricultural committee of the Macon Chamber of Commerce. I live at Perry, which is some 28 miles south of Macon.

The CHAIRMAN. As has been stated on several other occasions, I am truly glad to note that the businessmen are taking a little more interest about the farmer's plight. I wish there was more of that all over the Nation.

Mr. NUNN. The purpose and scope of the Farmers Club is to advance agriculture and animal husbandry and the best interests of all persons engaged therein.

The Farmers Club serves as the agricultural committee of the Macon Chamber of Commerce.

Its membership includes farmers, bankers, merchants, manufacturers, and professional men.

Macon is located in a very fine agricultural section; and while Macon has a large number of industries, it is estimated that not less than 60 percent of its trade and business is directly related to agriculture. Many of its industries handle, process, and manufacture products produced and used on the farms in its trade area.

In testifying briefly before this committee, I do so primarily as a representative of the Farmers Club of the Macon Chamber of Commerce, however, I might add that I have also been actively engaged in farming for some 30 years. I am also a member of the board of supervisors of the Ocmulgee Soil Conservation District and a member of the Farm Bureau Federation.

We desire to make to this committee the following points:

1. The financial condition of agriculture in this area is bad, and rapidly growing worse.

2. Many farmers in this area will have great difficulty in financing the production of another crop in the coming year.

3. The farmers are struggling under an almost insufferable financial burden. The price of what they buy constantly rises; the price of the products they produce and sell is constantly falling.

4. The farmers of this area have been more prosperous under the support of prices at 90 percent of parity than under so-called flexible support.

5. We recognize that support of the price of farm crops at 90 percent of parity or even 100 percent of parity is not the ultimate answer to the quite distressing condition of the farmers.

Coupled with rigid support at 90 percent of parity, it seems to us that there must be a more determined effort to get rid of the surplus crops in storage. These surplus crops will have to be sold in world markets at world prices, or below world prices. We believe the efforts of the Department of Agriculture to dispose of these surplus crops have been weak, slow, and perhaps fumbling. It seems that we are too much afraid of being accused of "dumping" these surplus crops by countries which produce and sell these same farm products in world markets.

6. We believe that under the flexible support plan which is now playing havoc with the agricultural economy of our country that the Secretary of Agriculture should be limited by law in the percentage by which he can reduce supports in any 1 year. If prices are supported at 90 percent of parity this support should not be permitted to drop to 75 percent or even to 80 percent in any 1 year. The shock and crippling effect is too great.

It seems to us that if the Congress would restore the 90 percent support for 3 years or even 2 years and provide that thereafter, if the surpluses are still burdensome or are depressing prices, the Secretary could reduce support prices by not more than 5 percent in any year, coupled with a corresponding reduction of acreage allotments, this would result in a much sounder, safer program of aid to the farmers. 7. One of the plans suggested by the Secretary is for the Government to rent a percentage of the cultivatible lands, and for the farmer

to plant such rented acres in grasses or soil-building crops. This plan seems to have considerable merit provided:

That the land rented be not the least productive acres on the farm; that restrictions be placed upon such rented acres planted to grass so that the livestock segment of our agriculture be not jeopardized further; that due consideration be given to land capabilities in determining the acres to be taken out of production. Technical skills now available through our soil conservation districts should be utilized in determining the use of the land for which rent will be received. Provision should be made upon a long-time basis for the reforestation of a considerable portion of the rented acres.

We believe that any sound program for the relief of the farmers should first of all make adequate provision for the protection and preservation of our two most vital assets-soil and water. Our Soil Conservation Service, which is doing a marvelous job with inadequate support, should not be treated as a stepchild but as a vital, indispensable member of the agricultural family.

The CHAIRMAN. Any questions?

Senator SCHOEPPEL. Where you say some of these acres should be taken out of production you mentioned grasses and reforestation. Do you think that all the farmers could stand that expense themselves or would they have to have some Government assistance?

Mr. NUNN. I do not think the farmers could stand that expense themselves.

Senator SCHOEPPEL. Therefore we would have to have something included in a program to assist in that respect?

Mr. NUNN. Yes, sir.

Senator SCHOEPPEL. Thank you.

The CHAIRMAN. Have you any formula to submit other than what has been already stated by previous witnesses?

Mr. NUNN. No, sir; I have not.

The CHAIRMAN. Thank you.

Next is E. W. Brooks, R. C. Neely, and Mr. W. J. Estes. For the purpose of the record will each of you state your names in full and your occupation?

Mr. BROOKS. I am D. W. Brooks, general manager of the Cotton Producers Association. We market raw cotton for our members. We have approximately 125,000 producer-members.

Mr. ESTES. I am W. J. Estes, farmer and ginner.
Mr. NEELY. I am R. C. Neely, farmer and ginner.
The CHAIRMAN. Who will be the spokesman?
Mr. BROOKS. I will.

The CHAIRMAN. Proceed.

STATEMENT OF D. W. BROOKS, GENERAL MANAGER, COTTON PRODUCERS ASSOCIATION, ATLANTA, GA.

Mr. BROOKS. I am going to devote my remarks entirely to cotton unless questions come from the committee otherwise.

Cotton is in the most desperate situation it has ever been in the history of this country. Production at the end of the present season will probably be between 14 and 15 million bales, which is an alltime high. We will produce approximately 17 million bales outside of

the United States and almost 15 million bales in this country, or approximately 32 million bales, which is also an alltime high by approximately 3 million bales.

The carryover last August 1 in the free world was nearly 20 million bales, which means that for the first time in history the total supply in the free world will exceed 50 million bales.

Let us see what has happened to us in cotton and what are some of the possible solutions. Our problems really started in 1951. In 1951 export quotas were placed on cotton producers in this country and at the same time a ceiling was placed on the price of raw cotton. We were prevented as farmers from exporting our cotton out of this country except by permission of the Government and consequently we held in this country a sizable amount of cotton which we could have sold into foreign countries at a tremendous price to cotton farmers. The CHAIRMAN. In that connection I have before me the statistics that show that in 1951-52 the carryover was 2,166,000 bales.

Mr. BROOKS. That is true.

The CHAIRMAN. Is it not that which caused the Department to put these export controls on?

Mr. BROOKS. That is correct. On the other hand, as a matter of actual supply we could have sold probably at least another million bales and survived. Now what happened was this: That immediately when this happened to us in this country and we stopped exportation of cotton and put a ceiling on the price of cotton in this country, the price in foreign countries went to 96 cents per pound. For example, a farmer just across the Rio Grande in Mexico could sell his bale of cotton at 96 cents at the same time we, as farmers in this country, were selling our cotton at 45 cents.

Now the reason why I am saying that is because of the fact that there has been a great deal of discussion and a lot of comments about subsidies that are going to farmers. Now there have also been great subsidies that have gone to the consumers of this country because if we had let the price level go as it went in other countries, instead of the consumers paying on the basis of 45 cents for cotton there is certainly direct evidence they might have paid 90 cents because the price of cotton in foreign countries and the price foreign producers received went to 96 cents per pound.

So I am saying that somewhere along the line-the reason I am building this is to get some balance here and show all of this has not been for the benefit of farmers and all against consumers-there has been some balancing on both sides.

The CHAIRMAN. I did not mean to argue with you. I just wanted to show the facts and the reason why it was done.

You have stated just a moment ago that the situation has been aggravated by more and more cotton on hand. Is it not true that this huge surplus has developed only in the last 4 or 5 years?

Mr. BROOKS. That is right. It has been developing. But the thing that started tremendous stimulation of production in foreign countries was 96 cents a pound. When that 96 cents a pound hit foreign producers and particularly cotton firms in this country who had some money which they had made off of cotton farmers in this country and they took that money and ran across the border and began to finance and help produce cotton in foreign countries; that is the thing that cranked it on.

It has been cranked ever since because, in effect, what has happened is that our 90 percent program, because we have been unwilling to meet competition in world markets and we have been unwilling to sell this cotton competitively-I don't think there will be any disagreement between you and me when we get through the discussion, because from the questions you have put here I think we are going in the same direction

The CHAIRMAN. I wish to state to you and other witnesses that I am merely taking the negative on many of these issues to bring the facts

out.

Mr. BROOKS. I understand that.

The CHAIRMAN. No Senator who has asked questions is to be gaged by the questions he asks. We are trying to get the facts.

Mr. BROOKS. I appreciate that you are trying to bring out the facts you would like to have.

The way our program has worked-our 90 percent program, for example, has worked-is that it was set up for the producers of this country but in effect the way it has worked out it has been a 90 percent. program for the producers of the world including the cotton firms who produced from this country and went to other countries and produced.

Senator EASTLAND. Is it not true that foreign producers have had every advantage of the American program except the reduction in acreage?

Mr. BROOKS. Certainly. All they had to do was expand their production and sell their cotton a dollar a bale and they took the export market. The facts are that sitting with that type of situation and we not being competitive in the world market with our cotton, we have seen the expansion move until from 1947 up to the present time it has doubled in foreign countries, at a time we were trying to pull down.

Senator EASTLAND. There was a time when foreign countries had to come to the United States for their cotton supply. How long before— how many years will it be before foreign production will equal foreign consumption if this expansion continues?

Mr. BROOKS. Only 2 or 3 years. This situation is so desperate in cotton that if we do not change our sales policy with reference to sales into foreign countries we will have no export market in 3 years from now, and we will be down to producing from 812 to 9 million bales for domestic consumption only; and that will absolutely wreck the whole cotton economy of the entire cotton South. It is the most serious thing the South has faced in history practically since certainly the depression years.

And what has happened in foreign production? They have moved up since 1947 from 82 million bales to approximately 17 million. The program is to continue to expand to where they take all the export markets and leave us none. That is the present program. It is doing it step by step and we have only 3 years in which to save any of it. Because once they get into production it is far more difficult to put them back out than it is to keep them from going in.

Senator EASTLAND. Now the export cotton market is about 1112 million bales, the international market; is that true?

Mr. BROOKS. About 12 million.

Senator EASTLAND. Twelve million bales. At what price-I think you will agree we have to build our exports up to around 5 million?

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