STATEMENT OF RAYMOND C. SINGLETARY, SOUTHEASTERN PEANUT ASSOCIATION, BLAKELY, GA. Mr. SINGLETARY. I am going to be very brief, Mr. Chairman, but it is certainly not any lack of seriousness of the problem for this brevity. The farmers in our area are tied very closely to the peanut-shelling industry. Many of the shellers are also the seed and fertilizer dealers in their area who are furnishing the farmer. Many of them are. The bankers and most of the shellers are also peanut farmers themselves: so they are very close. We recognize that the farmers are, and as a result we will be in very desperate plights in this area with reduced prices for peanuts. We understand that with modernized parity as it is becoming effective January 1, unless something is done the price of peanuts will be reduced to approximately $12 per ton. There is also a possibility of flexible parity coming into play, and a large part of that is the result of some 84,000 tons of imported peanuts brought into this country during our recent shortage, and in addition The CHAIRMAN. Those were edible peanuts? Mr. SINGLETARY. Yes, sir. Imported for edible purposes. It is granted that some were needed, but certainly it seems now as things have developed, that no such quantity as was imported was needed. The CHAIRMAN. Have you a formula to offer here that would make it possible for more edible peanuts to be grown? As the law now stands, as I was informed, there seems to be a little contest between peanut growers as to whether they should be grown for oil or be edible. It came before our committee several times. Some ways and means were suggested whereby we should find a formula to permit the production of more edible peanuts in areas where they can be grown. Do you have any comments on that? Mr. SINGLETARY. Mr. Chairman, I wish I could. Frankly, something has come up within the last week that has somewhat changed my opinion, but I do not believe it advisable to go into it today. The CHAIRMAN. We will leave that to Steve Pace, who is an expert on peanuts. Mr. SINGLETARY. I think some things have come about because we have had some poor administration of a program in the past that turned people against oil peanuts, and I personally feel there have been some changes recently that may make that change, but I am not willing to comment on it at the present time. I will say, however, that in regard to the production of peanuts there is a formula which has been worked out by a peanut study that shows that reduction of price of peanuts has very little relation to the consumption. I believe it is about four-tenths of 1 percent change in consumption for each 1 percent change in price. Therefore, this applying modernized parity or applying flexible parity support, either one, in reducing the price would do nothing but hurt the farmer. It would not increase consumption of peanuts, but very little. Therefore we, both as a farmer and sheller The CHAIRMAN. You know the same argument is advanced as to cotton producers. Increasing cotton production 3 or 4 percent would not make the price of this shirt come down any. It will sell for the same price, about $4.50. The same thing goes for wheat. It was brought out that a difference of as much as 30 cents a bushel on wheat would not materially affect the price of a loaf of bread. A matter of fact, the record shows that with cheaper wheat, bread has one up. Mr. SINGLETARY. We are very thankful in the peanut industry that we do not have some of the complex problems of disposition of surpluses that are in the wheat and cotton and some of the other industries. We feel that actually because of this relative inelasticity and because of the fact that peanuts can be disposed of, the surplus peanuts can be disposed of without creating any State Department problems or actually having very little affect on other agricultural programs, we have an opportunity for helping the farmer and maintaining a proper price relationship, and it is one that he needs also. The CHAIRMAN. I am glad to see it. Only a few States can grow good peanuts, and I think Georgia is one; Louisiana grows good ones, but not as good as Georgia I will admit. Mr. SINGLETARY. Thank you. That about completes what I have to say. We do urge the continuation of 90 percent support in the peanut industry and likewise urge doing away with modernized parity because we can see $50 a ton over a 5-year period will be deducted from the price of peanuts and we do not believe our farmers can stand it. The CHAIRMAN. Anybody else? Mr. SINGLETARY. Thank you. Senator SCHOEPPEL. You fellows in your industry have some attractive radio programs and television programs on the use of peanut butter. That ought to help. I wish we had something like that in wheat. Mr. SINGLETARY. We are most hopeful that that will be of assistance. We do not know whether it will or not. We can't see it yet, but we do think that that will have a marked influence on our industry. STATEMENT OF W. J. McKEMIE, JR., COLEMAN, GA. Mr. McKEMIE. I would like to back up these gentlemen a hundred percent in the idea that we definitely want, and it seems we must have, our 90-percent program. We also are tremendously concerned about this thing we call modernized parity and flexible support prices. It seems like it is a little bit like a boy that I saw down on the street in Macon a few years ago on my way home from a football game during the war. A big soldier was trying to keep him from getting into trouble, and he couldn't get the boy to go back to camp so he set out to slap him sober, and it was rather a brutal thing. He would slap him one way and slap him back. On this modernized parity it seems we will be slapped one way and back the other. We don't find anything we are purchasing today that is flexible regardless of whether it be farm machinery, taxes, or what have you. Thank you. Mr. Cox. Let me make one other statement in regard to this modernized parity on peanuts. During the war, of course the farmers were in business to make money but for patriotic reasons we were asked to produce all the peanuts it was possible to produce. We realize at the same time we were definitely mining our soil, and it was a blended price, those peanuts to go into edible trade or go into oil as the Government saw fit. At times the oil market could have taken the edible market away from peanut shellers. We don't think it is fair to take peanuts as a commodity and use modernized parity on them because we were producing something at that time with a dual-purpose use and certainly it would not be fair. The CHAIRMAN. I am glad to note here from the Commodity Credit that the loss sustained by the Government on peanuts has been considerably reduced from past years. This year, according to this report,, the losses will be about $2,103,083 as compared with prior years of as much as $25 million up to $80 million. Mr. Cox. We will get our house in order if we have an opportunity. The CHAIRMAN. We will try to do that for you. Next are Mr. J. M. Abercrombie and Mr. Phil Campbell, representing the dairy industry. Mr. ABERCROMBIE. I am J. M. Abercrombie, and I am a middle Georgia dairy farmer. Mr. CAMPBELL. I am Phil Campbell, commissioner of agriculture, State of Georgia, dairy and cotton farmer. STATEMENT OF J. M. ABERCROMBIE, CULLODEN, GA. Mr. ABERCROMBIE. Mr. Chairman and members of the committee, I do not propose to come before you today and offer a master plan that will cure the ills of the dairy industry. I prefer to confine my remarks to supporting some of those things you are already doing that we are in accord with. Within the State of Georgia there are a large number of dairymen that are affiliated with the National Milk Producers Confederation through member associations. That organization this week has been in session in Los Angeles and only Thursday they closed their meeting. We do not have the things that they will offer you to offer our support to. The CHAIRMAN. How about you? Have you any ideas of your own on this, as to what we ought to do for the dairy farmers of Georgia? We might be able to get some views from you that may not conform to what your association states. If you have any views we would like to have them if you do not mind. Mr. ABERCROMBIE. I am strictly a farmer and do not keep up with all technicalities. The CHAIRMAN. That is why I come to you, a farmer. Give us your own views. Mr. ABERCROMBIE. We may have some ideas we may wish to advance and I may get lost in the rush if I try to solve it. But we are strictly in this State fluid milk. The CHAIRMAN. Where do you sell your milk? keting agreements? Have you not mar Mr. ABERCROMBIE. We do. I happen to have through a co-op. The CHAIRMAN. Have you any suggestions as to changes in laws giving you the right to enter into agreements, or would you want them to remain as they are? Mr. ABERCROMBIE. I am in accord with the co-op agreement as it stands. The CHAIRMAN. I think this committee will agree with me that in most areas where these agreements are permitted and entered into that the problem insofar as dairy is concerned is not too acute. It is only in those States where there is a great oversupply of milk and where they have to use it to make cheese and butter and dry milk and things of that kind. The ABERCOMBIE. I agree with you. I feel that The CHAIRMAN. So that the dairy problem in Georgia is not so acute, is that not so? Mr. ABERCROMBIE. Without taking any importance away from the national trend, I do feel like a large part of our responsibility is local more or less within the State. The CHAIRMAN. That is what we found in many States. Mr. ABERCROMBIE. I think I made the remark that there will be certain legislation to come from the National Milk Producers Confederation that we will be in accord with when they have an opportunity to present it to you which I am sure you will, the Congress will. I would like to mention at this time The CHAIRMAN. Now you know what they are planning to put before us again is this so-called self-help plan. Are you familiar with that? Mr. ABERCROMBIE. I am vaguely familiar with it. The CHAIRMAN. Are you in accord with it? Mr. ABERCROMBIE. I couldn't say that I am with no more study than I have given it. I do wish to lend my support, though, to the special school milk program that was inaugurated some 2 years ago and which was successful. As I understand, it has afforded milk to thousands of children that otherwise would not have been able to have it. We beg of you to extend and increase that program if possible. Also I would like to mention the Federal milk marketing order. While we do not have that in Georgia-at the present time we are operating under State milk control board-we feel that it does have a stabilizing effect on those areas where it is used and it extends over into our State under certain conditions. I would plead with you to keep the Federal milk orders in effect with no amendments to it. The CHAIRMAN. That is what I was talking about a while ago. Mr. ABERCROMBIE. I knew you were. The CHAIRMAN. I may not have worded it right, but that is what I had in mind. I wish to suggest that if and when this so-called self-help milk program comes before you, that you do study it very carefully because we have had it before the Senate a couple of times. Quite a few members of the Senate found it to be misnamed when it is called self-help in that it provides for the creation of a board of 15 people who have legislative powers, taking these legislative powers from Congress, and they would be authorized to deal with every drop of milk produced all over the country. Another thing, they would expect the Federal Government to make available to them without any security only a half billion dollars. Now if that is a self-help plan, you had better look into it, because I don't think it is. Mr. ABERCROMBIE. I have had some literature on it. The CHAIRMAN. You'd better study it and find out before you endorse it. Look into it from every angle. I am not throwing cold water on it right now or saying I would not be for it, but when you designate a plan as self-help and you get the powers of legislation in the hands of 15 people to control the entire milk industry and have the Government advance them $500 million, that is quite a sum of money. Whether a plan like that could be passed by Congress I do not know, but it requires serious consideration. Such a plan as that I do not believe could be passed in January, as I suggested a while ago when we talked about enacting legislation to take care of the basics. Mr. ABERCROMBIE. Mr. Chairman, there are other things concerning the dairy industry of this State that I feel I would be qualified to bring before you that would have national significance, but I have with me another witness and if it is your pleasure I would like for him to take over. The CHAIRMAN. All right. Any questions to be asked of Mr. Abercrombie? STATEMENT OF PHIL CAMPBELL, COMMISSIONER OF AGRICULTURE Mr. CAMPBELL. Mr. Chairman and members of the committee, I want to explain my position to you. Until January I was in the same condition as my predecessor; I was a dairyman only. Since that time I have had the duties of commissioner of agriculture of the State of Georgia and I speak both as a dairyman and in my official capacity as commissioner of agriculture. The CHAIRMAN. You ought to be able to give us some good ideas. Mr. CAMPBELL. I will solve all the problems for you. I would like to be very brief. I know we don't have too much time. The CHAIRMAN. You take all the time you want to if you give us the plan. Mr. CAMPBELL. I will give you 3 or 4 specific recommendations. First I would like to bring to your attention something that I am sure the people of the United States as a whole and the press do not realize about milk and price of milk, and that is that insofar as prices are concerned milk has what we call a slow price curve. By that I mean that in a depression or deflated times when prices of the entire country are low that the price of milk never goes as low, and in inflated times such as we have now the price of milk never goes as high because we do have this slow price curve. You may be familiar with what I am talking about. I will proceed from there and say we are in an inflated time and the price of milk, comparatively speaking, is not nearly as high as other products and the best illustration I can give is that when I went into the Army in 1942 I could milk 25 cows and hire 3 full-time laborers with the production from 25 cows. At the present time I cannot hire 1 full-time, competent, good laborer by milking 25 cows. I give that as an illustration to get to these recommendation which I have which are these The CHAIRMAN. What really occurred is that the cost of distribution has gone up considerably. Mr. CAMPBELL. Cost of distribution is up, but you have the other picture of inflated times with a high-price level in the United States |