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the small farmers, it has made our problem more acute than the average.
Mr. COOLEY. That is tornado velocity.
Mr. LEARY. Yes, sir. And one thing I would like to see done is Senate investigation of the difference in farm prices—what the farmer gets and the consumer pays—in order to spotlight it in the national way to help the farmer gets his problem before the public as the criine investigation did.
Another thing I can't understand is that the Government spent thousands of dollars and millions, maybe, in soil reclamation when we are producing too much now. I believe in that. In order to keep the balance so that we don't get behind, we should always stay so we can produce enough but it just doesn't make sense to me to spend millions of dollars reclaiming soil and running other farmers out of business.
The CHAIRMAN. We have had suggestions on that and a lot said we should curtail it until we need more land. Mr. LEARY. That is my opinion.
Senator Scott. One man said yesterday just declare a holiday and not do anything for a year. Mr. COOLEY. On reclamation and irrigation? Senator SCOTT. Everything.
The CHAIRMAN. We have a lot of testimony obtained from the West, believe it or not, that suggested that we ought to lay off of any further reclamation development until we need the land. There may be a lot to that and we may have to look into it.
Of course, most of these projects you understand are what we call multipurpose, for the production of electricity, flood control, navigation, and also irrigation.
Mr. LEARY. We believe in all those things, when you need power and we believe in flood control and when you need power build your dams, but opening up this extra land to be in competition with us is detrimental to us.
The CHAIRMAN. That doesn't seem, Mr. LEARY. Naturally from the East we haven't heard much about potatoes today and we have been kicked about potatoes. We feel that something should be done with that.
The CHAIRMAN. You mean support?
The CHAIRMAN. We repealed it.
Mr. LEARY. At one time they would penalize you about $90 an acre if you overplanted and it didn't cost the Government anything to do it.
Mr. COOLEY. We didn't have acreage allotments. Lindsay Warren sponsored the bill and got it through Congress.
Mr. LEARY. How were we paid $70 to $90 an acre for taking it out of production?
Mr. COOLEY. That was the support program.
Mr. LEARY. There was no overproduction and putting them in the woods at that time.
Mr. COOLEY. They paid you not to plant.
The CHAIRMAN. Thank you ever so much, sir.
At this point we will make a part of the record a statement by Mr. B. S. Davis, of Evergreen, N.C.
(Mr. Davis prepared statement follows:) I decided to write this letter to let you know about some grievance we the people have and to suggest some ideas that it might help you that you, having a keen mind, might take these rough ideas and work out something that will help us to have a better and a clearer program,
Idea No. 1: That where there is tobacco given in a district to adjust the acres that each and every farmer in that district gets with their notice of their allotment who got the tobacco that was given out. Another thing we would suggest that these allotments of one-tenth and two-tenths that some people have that live in towns and villages and have these allotments on no more than lots be cut out. In other words, set a minimum of acres that you could have an allotment on. I have been told by the boys that measure that there would be a right good number of acres in each county that could be cut out.
Another thing: I suggest that the penalty be raised so high that people won't be tempted to overplant, which is what's wrong with our program now.
The CHAIRMAN, Congressman Fountain's statement will also be made a part of the record in its entirety.
The statement of Hon. Lawrence H. Fountain, Representative in Congress from the Second Congressional District of the State of North Carolina is as follows:)
Mr. Chairman and members of the committee, I appreciate the opportunity to make this brief statement.
It is my privilege to represent the people of the Second Congressional District, who live in Bertie, Edgecombe, Green, Halifax, Lenoir, Northampton, Warren and Wilson Counties in the northeastern part of North Carolina.
A very large number of my constituents receive all of their income from farming, particularly from the production of 4 of the 6 basic crops-tobacco, peanuts, cotton, and corn. The ability of the farmers of the Second District, and elsewhere in North Carolina, to maintain a decent standard of living for themselves and their families depends directly upon their ability to obtain fair prices for these crops. In addition, the prosperity of the entire Second District of North Carolina is substantially affected by the price level of these four basic crops. This is likewise true in practically all of the farming areas in North Carolina.
The farm families of our country have done a truly magnificent job of producing the food and fiber needed to give us the world's highest standard of living. But there are some problems which no individual farmer can solve by himself, no matter how resourceful and industrious he is.
The several million farmers in this country are each a separate business, run by individuals. Being individual units, they have no production and marketing system which they can control, except with the help of their Government.
It is easy to say that a farmer ought to grow what he can get the most for and trust to luck to make a profit, just as other people do. However, it doesn't work that way, and very few others are able to function under such a system. Take the car manufacturers for example. There are three big companies doing about 75 percent of the total business, and all told there are only 5 or 6 companies. If there were only 3 big farmers in America raising 75 percent of the cotton, corn, peanuts, tobacco, rice, wheat, etc., and 3 or 4 others raising all the rest, they wouldn't need any Government support prices. They'd just hold the food off the market until they got what they had to have.
Let us take tractor manufacturers as another example. There are 7 or 8 companies making all the tractors and other farm implements for the farmers of this country; and yet, car manufacturers and tractor manufacturers have price supports in the form of tariffs.
The farmlands of America are divided up into small units. Let us hope this situation will continue to prevail, because if there is anything that keeps our democracy functioning, it is a lot of small people who are their own bosses and are economically uncontrolled by anybody else. However, as long as our farmlands are so divided into small units, there must be some method devised to let a farmer know when he starts a crop about what he can get for it when he finishes. It is the most stabilizing factor in farming today. 64440—56-pt.
The farmer is probably the only producer who can control neither the amount of his product that is produced nor the price at which it is sold. As a resut, in past years, compalratively small surpluses have forced the price of farm products far below the cost of production. I am sure we all remember some very vivid examples of that situation in the early 1930's before the establishment of our present farm program.
The Federal farm price-support program was established to help insure the farmer a fair share of the national income and to help protect our farm families against economic disaster caused by factors over which they have absolutely no control. Price supports are not a special favor to the farmer at the expense of those in other ways of life, but a fair, logical and necessary program fully justified by its contribution to the overall economic stability and well-being of our country.
The farm price-support program has, of course, cost some money. The cost of the program is small indeed when measured against the tremendous benefits derived from it. As a matter of fact the cost of the farm price-support program appears modest when considered alone. It appears even more modest when compared with the many billions of dollars spent on other programs. In addition, it has been much smaller than the losses sustained by our Government in its performance of services for other specific segments of our economy.
Unfortunately many leaders in high places have endeavored to make our people believe that our farmers are living on Government bounty when the truth is that subsidies to agriculture add up to only a very small fraction of such payments that have been going to business and industry since the very beginning of our Government. Data by a House Appropriations Subcommittee in 1954 indi. cated subsidies amounting to approximately $45 billion have been paid to business since World War II, a large part of this in business reconversion payments.
Today the farmer is caught in a serious economic squeeze. Farm prices have steadily declined, while the cost of things the farm family must buy have remained fairly stationary or increased. Without the stabilizing influence of rigid price support at 90 percent of parity on what we refer to as the basic commodities the situation would unquestionably be much worse. For example, this year the tobacco farmers in my section would have gone bankrupt without such a program.
Ninety percent price supports may not be perfect but on the whole they have worked well. Every effort should be made, to make such other improvements in the program as will make 90 percent price supports even more effective, and to eliminate unnecessary surpluses. I firmly believe that 90 percent supports would have worked even better if certain of our officials in high places had spent more time trying to make them work and less time propagandizing for lower flexible supports. How anyone can contend that 70 percent or 75 percent or even 821 percent of parity is better for the farmers than 90 percent is beyond me. As I understand it, parity is supposed to mean a fair price. Apparently there are some who believe that 70 percent or 75 percent or even 8212 percent of a fair price is better than 90 percent of a fair price.
One hundred percent of fairness never did seem like too much fairness to me, but it appears to be from 25 percent to 30 percent more than some people in high places believe in. In other words, many believe in equal justice to all, except farmers, and they believe further that 70 percent to 75 percent is enough for them. I just can't understand it.
Many people know from experience that the difference between 75 percent and 90 percent of parity means the elimination of absolutely all profit. Surely, no serious-minded person in America believes our farmers should supply food and fiber for the rest of the Nation at less than cost, and without being able to supply the same thing for themselves.
As I understand the law now in effect, in addition to dropping price supports to 75 percent of parity, the modernized parity formula will also go into effect and this will mean an additional loss to our farmers.
One further thing and I am through. The problem of price supports and effective production controls is one problem. The problem of disposing of surplus now on hand is another, and should be so treated. While we can afford the comparatively modest cost of 90 percent price supports at least on the basic commodities, we cannot afford to add momentum to an already dangerous decline in farm income by reducing the support level. Nor can we afford to forget that depressions on the farm have a historical habit of moving into town.
I therefore urge the members of this committee to take all possible and speedy action to see that price supports on basic crops are maintained at not less than
90 percent of parity, and that appropriate and proper methods are adopted and enforced to handle our present surplus of commodities.
The CHAIRMAN. I wish to say the committee was very happy to come to North Carolina, and we are glad to have been able to at least give a chance to all those who came to be heard, and we hope from what we obtained from you and others we will be helped in preparing a suitable bill for enactment next January.
Mr. COOLEY. I want to say for the people of my district, and I think generally for the people of North Carolina, that we are grateful to you and members of your committee for having provided this forum in which our farmers and farmers from adjoining States could come and present their views directly to men who are dealing daily with their problems. I think it has been a very constructive hearing and I am sure that members of the committee will profit by the information which has been given here.
Most of all, I want to commend you publicly here in my district and in this tobacco growing area for something you did and have perhaps forgotten long ago. I want to say that it was Senator Ellender of Louisiana who engaged in a terrific debate on the floor of the Senate and, as a result of his efforts, largely through his efforts, our tobacco program was actually saved when 2 North Carolina Senators were trying to insert into the tobacco program a 15-acre minimum allotment which all of us knew would be disastrous. Senator Ellender, I remember, engaged in a debate with the North Carolina Senators and I conclude he knew more about the tobacco farmers' problem than the North Carolina Senators at that time knew.
I want to add they were not the two North Carolina Senators who are in Congress now.
Senator SCOTT. We have two good ones now. Mr. Cooley. That is right. All of us are grateful to you for what you did.
The CHAIRMAN. I remember the occasion.
We will stand in recess now until we meet in Montpelier, Vt., on Friday next.
(Whereupon, at 5:45 p. m., the hearing was recessed, to reconvene at 9 a. m. Friday, November 18, 1955, in Montpelier, Va.)
(Additional statements filed for the record are as follows:)
STATEMENT FILED BY T. W. ALLEN, CHAIRMAN, TOBACCO COMMITTEE, NORTH CARO
LINA STATE GRANGE, RALEIGH, N. C. I am T. W. Allen, chairman of the tobacco committee of the North Carolina State Grange.
It is needless for me to say that the tobacco farmers of North Carolina are in favor of the tobacco program as it is now constituted. They have proven this by voting almost unanimously in several referendums. Of course, we all recognize that changing conditions will automatically make minor changes necessary.
Under the program, we have kept supply in line with consumption, and never in the history of the program has there been a scarcity of tobacco. We admit that unusually favorable weather conditions the past year have created a surplus at the present time. Therefore, we recommend that the 1956 crop be reduced to the extent that this surplus will be gradually disposed of.
The cost of production has increased to the extent that there is practically no profit in the production of tobacco. It is, therefore, evident that anything less than the support price of 90 percent of parity would be disastrous.
We commend this committee for their interest in agriculture and for their efforts in trying to determine the wishes of the farmer, and I wholeheartedly urge you to continue the tobacco program on the same basis that it is now constituted.
STATEMENT FILED BY W. S. ADKINSON, JR., CLOVER, VA. I am W. S. Adkisson, Jr., of Clover, Halifax County, Va., and I am appearing in behalf of the Halifax County Farm Bureau. On October 28, 1955, at a membership meeting for the purpose of adopting resolutions the following resolution was adopted: We believe that the Agricultural Adjustment Act of 1954, as amended, together with the soil fertility bank plan offers the best solution to the problem of farm surpluses.
Our reasoning is that the key to the farm trouble is to find more, better, and faster methods of unloading surpluses rather than building more and more surpluses by going back to 90 percent of parity. Estimates are that except for market depressing surpluses, the consumption of United States farm products in 1955 will be only 1 percent less than production. Under the soil fertility bank plan as proposed the Government will rent part of each farm and retire the rented acres from production. These diverted acres are to be planted to grasses and soilbuilding plants such as clover and alfalfa.
STATEMENT FILED BY 0. A. CARSON, GALAX, VA. I am a farmer from the mountains of southwest Virginia, and I would like to express my gratitude for the opportunity of appearing before you at this hearing.
We all realize the serious condition of the Nation's agricultural economy and hope and pray that a just and workable solution may be found. We certainly do not want the passage of unsound legislation for the sake of importunity
Many farmers in Virginia feel that high, rigid supports have only aggravated the situation and has worked to the detriment of the average American farmer. Being a producer of livestock, I am certain that high, rigid supports have hurt rather than helped me. They have increased the cost of feed and other items which I have to purchase and has helped to hold back the consumption of the product which I produce. As you of course know, it was under this system of high, rigid supports that huge surpluses of farm commodities were built up. Surely, we have had enough of this.
While flexible supports are far superior to rigid supports in that they will eventually lower our surpluses, I feel that they are not the ultimate answer but are only a stopgap measure. I would like to recommend that a thorough study be made of the farm program advocated by the Potato and Vegetable Grow. ers Association, which is based on the principle of a land fertility bank. While I dislike subsidies and controls, it seems more practical to me to pay a farmer not to produce than it does to pay him for a product which he has produced but which is not wanted or needed. This method at least eliminates the cost of production, transportation, and storage while maintaining or increasing the fertility of the soil.
It is regrettable that so many man-hours have been expended by our leaders in wrangling over the merits of one method of price supports over another when they could have been used to explore for the fair, just, and honorable methods to expand our markets, particularly our foreign markets, which we have lost to such a great extent. Consumption of our efficient productivity is the true answer to a prosperous agriculture.
Again I think you for this opportunity of being heard and trust that some real good for the American people, and most particularly the average American farmer, will come from these hearings which you gentlemen have been holding.
STATEMENT FILED BY P. C. CONNER, ELK CREEK, VA.
As a farmer I wish to make a statement regarding the present agricultural situation. I believe that my remarks will express the opinion of the majority of the clear-thinking farmers of my home county of Grayson County, Va. It is generally agreed that the conditions of the American farmer are not too good as compared to other segments of our economy. Granted also that there is an upward surge in the sentiment of the farm population that some legislative action be taken to alleviate these conditions it is hoped that you will not support a program which might be a rapid or temporary panacea at the risk of developing a program which would be economically unsound over a long period. In this connection I wish to make it clear that I do not favor a return to the high rigid