with butter and get the same nutritious value as butter. Consequently, they have continued using these spreads. All of these things have caused a lower consumption of butter. I don't believe that any amount of advertising is going to change this. The processor is being favored by the present administration. The consumer has received no benefits; in fact, the price of milk has gone up to the consumer. The small creamery is being forced out of business by the large dairies, driving out 50 or more miles to pick up the farmer's milk. Most small creameries do not process milk. As secretary of Blue Earth County Farmers Union, I come in contact with a lot of farmers, most of whom are not in favor of the flexible parity, nearly all of whom are in favor of 100 percent of parity on dairy products. With 100 percent of parity, you will keep the family-size farm intact. I keep a herd of milk cows of from 10 to 14 head. This is how the price of butterfat has dropped since 1952: September 1952 I received $1 per pound for butterfat. September 1953 I received 90 cents per pound for butterfat. You can see from these figures how the flexible parity has affected my income. Most milk in Minnesota goes into manufactured products; therefore, we should be much interested in support price of butterfat. I contacted two of my neighbors who sell grade A milk for the same month. You can see from these figures the dairyman selling grade A milk has been hard hit too. The producer of grade A milk has been hurt through 75 percent of parity, too. Because of this he produces more milk, which must go into production of butter and cheese. This in turn hurts the producer of milk for butterfat. I do not go along with the Secretary of Agriculture's plan of having a county agent looking over your shoulder to take the inefficient farmer off the farm, and putting him to work in town. If that takes place what is the man in town going to do for a job? I believe there are probably more people in town now than can be fully employed. In conclusion, I believe the dairyman must receive 100 percent of parity to meet his fixed bills, live decently, and be able to give his boys and girls an education. I think that we should have a program set up by Congress and maintained, so that the farmer is not made a political football at the time of every State and national election. If we don't get 100 percent of parity on dairy products my belief is we will end up with many farmers going broke, and there will be many places of business closing their doors, because if the farmer is not prosperous, the entire economy of the country suffers. The CHAIRMAN. The next witness is Mr. Lueders. Your whole statement will be put into the record at this point. You can highlight it, if you will do so. STATEMENT OF ARTHUR LUEDERS, WACONIA, MINN. Mr. LUEDERS. Mr. Chairman and honorable Senators of the Agriculture Committee, I am Arthur Lueders of Waconia, Carver County, Minn. I own and operate 120 acres together with my wife which we purchased in the spring of 1944; prior to this we had rented. My farming life was nearly all spent in Carver County with the exception of 2 years in Stearns County as manager of Sauk Lake Coop Oil Association and 3 years in Cologne as manager of Mid-County Co-op Oil Association, Carver County, which I pioneered and organized in 1955. The CHAIRMAN. Mr. Lueders, if you desire, as I just suggested, you can put the whole statement in the record as though you had read it and comment on it or highlight it, if you will, because if we do not do that, somebody will not be heard today. Mr. LUEDERS. Thank you, Mr. Chairman. My income jumped from $5,830 in 1944 to $10,368 in 1952; down to $8,209 in 1954. My expenses jumped from $4,781 in 1944 to $6,099 in 1952, and held at $6,934 in 1954. This leaves my family with only about $100 a month to maintain my investment, my home, and my family. Repairs have gone up about 7 percent, in July. We hear a lot of talk about efficient farmers. They are the only ones that will stand on the land. W hear that from the Secretary of Agriculture, the Extension people, and so forth. Those that get their teeth into it do not fare so well in my community. A farm owned by one of these people is operated on a livestock basis and has only a return of 27 cents an hour. Incidentally, this herd is also in the DHI Association of which I am a member, and has a 400pound herd average. It is necessary for him, in order for him to maintain his family, to go and work in the canning and sugar beet factory. You should see this man. He is pale, tired, and he works in the factory from 12 midnight until 8 a. m., and then does his chores in the daytime. Many of us have to do the same thing. The degree of the efficiency of my farming is attested to here by a pamphlet that was given to me, The Dairy Facts of Carver County. For legislative suggestions, I have 90 percent supports, direct to the farmers, which would protect the small operators. We are in accord with the national dairy quality law, that no butter be sold below 90 score butter. I do have a protest on the ADSC county committee election board. This is a little outside of the dairy subject, but I protest the use of Government employees to sit on the county ASC election board. This, I feel is unethical and undemocratic. The results of this meeting are attached to my statement. If the Federal highway system is passed, make provision that gasoline used in farm tractors be exempt from the gas tax. The present tax costs me about $25 a year. Let me say this on controls: Since the flexible price support went into effect, the price that the consumer pays and the price that the farmer gets has a wider range of margin inbetween. It has widened. And the farmer is down, and the consumer has remained about the same, in some cases it is up. My evaluation of that is this, that the processor and the distributor-and I have just talked to a packer here this morning and he tells me that for the risk that they are taking, they must have a bigger margin of profit. So if we had a stable or a 90-percent price support, the risk in handling the farm commodity product after it leaves the farm to the consumer, they can operate at a smaller margin. Their risk is not so large. For that risk they are taking a bigger margin. I wish that you would investigate it. Another thing that I am concerned about is the statement that a former colleague and a fellow farmer in my county made this morning. I suggest to you that you investigate the background of the growth. There are a lot of statements made with regard to DHI. Those figures are misused. They do not tell you the whole story. In the case of a herd that has 400-pound production of butterfat, according to DHI figures, they should have $1.20 an hour. Actually, the net result is only about 27 cents an hour for that man. And I agree with what Mr. O'Neill said this morning about unity in farm organizations. I have offered that to the president of the Farm Bureau from our county, that we sit down and create a public relations meeting, so that we can discuss the factors before the people. Another item that I have that I wish that you would investigate is the cost of administration of the ASC committees. I understand that the cost of administration is $20,000 in a year to distribute $12,000. Thank you. (The prepared paper of Mr. Arthur Lueders is as follows:) Mr. Chairman, honorable Senators of the Agricultural Committee, I am Arthur Lueders, of Waconia, Carver County, Minn. I own and operate 120 acres together with my wife which we purchased in the spring of 1944; prior to this we had rented. My farming life was nearly all spent in Carver County with the exception of 2 years in Stearns County as manager of Sauk Lake Co-op Oil Association and 3 years in Cologne as manager of Mid-County Co-op Oil Association, Carver County, which I pioneered and organized in 1935. I also organized and served on the board of directors of Minnesota Valley Breeders Association, New Prague, Minn., and also Carver County REA before we merged with other counties to become Minnesota Valley REA. I also served as director of Carver County Farm Bureau, group health mutual hospital insurance, township clerk, church and related societies, and at present chairman of Carver County Farmers Union. Our farm has 90 acres under cultivation and very rolling with many slopes of 45 percent-the average between 20 and 35 percent and suited primarily for dairying; a rotation of about one-third legumes, one-third grain, one-third corn. We have all necessary equipment-two tractors, choppers, picker, thresher, etc., deep freeze, TV, radio, modern home, and due to good soil-conservation practice, I feel we produce as good or better crops than others in the community with similar soil. As a result of this we are carrying on this place 8 milk cows, 6 heifers, 1 brood sow, 100 chickens more than the soil-conservation production capability plan calls for (for degree of efficiency of dairy herd, see extension pamphlet). Our present livestock-26 milk cows, 16 heifers, 300 layers, 2 brood sows; my gross income jumped from $5,830 in 1944 to $10,368 in 1952, and down to $8,209 in 1954. Expenses jumped from $4,781 in 1944 to $6,989 in 1952; held at $6,934 in 1954. This leaves us with only $100 per month to maintain our investment, home, and family. With labor scarce and wages up, the trend was to more and bigger farm machinery to save labor it meant exchange and custom work with neighbors. This meant more expense, higher depre ciation, more taxes, more interest; cost machinery is getting so high that we cant' afford to buy new. Repairs have risen 7 percent in July. With oats selling at auctions for 60 cents, corn at 80 cents, the application of fertilizer is a costly investment. The farm buildings all are in need of paint and repairs; stanchions should be replaced in the barn; we are in need of weathertight shed for car and tractors. All this we cannot do because lack of purchasing power. We hear a lot of talk that only the efficient farmers will stay on the land, by Secretary of Agriculture, radio farm commentators, county extension people, etc. Those that get their feet into it don't fare so well in my community. A farm owned by one of university agriculture professors operated on livestock share basis has 400 pounds herd average, and in farm management association has only a return for labor of 27 cents per hour. So I am informed by the operator, it only is necessary for him to work in canning and sugar factories to maintain his family. You should see this man, pale and tired, works in the factory from 12 midnight to 8 a. m., and chores in daytime and many others have to do the same. LEGISLATIVE SUGGESTIONS Prices: 90 percent and plus supports direct to the farmers with controls to protect the small operators. Let me say what I contend: Congress investigated changes in prices to consumer controls: Create a stable market. Dairy: National butter quality law that no butter grading below 90 score be sold as butter. ASC: Re county election boards-I protest the use of Government employees to sit on county ASC election boards; this I feel, is unethical and undemocratic. (Result of meeting is attached.) Roads: If a Federal highway system is passed, please make provisions that gasoline used in farm tractors be exempt from gas tax. The present 2 cents costs me about $25 per year. To you Senators: I protest the use of Government employees to sit on county ACS election boards. The CHAIRMAN. Thank you. Mr. LUEDERS. Thank you. The CHAIRMAN. We will next hear from Mr. Maloney. STATEMENT OF ART MALONEY, CHAIRMAN, ROOT RIVER LOCAL FARMERS UNION, SPRING VALLEY, MINN. Mr. MALONEY. My name is Art Maloney. I am chairman of the Root River Local Farmers Union in Fillmore County. The CHAIRMAN. Can you not summarize your statement, please? Mr. MALONEY. Yes. The CHAIRMAN. And the whole statement will go into the record. Mr. MALONEY. Very well, thank you. I own and operate 160 acres of land. We farmers are in trouble or else I would not be here. In 1952, in Spring Valley, Minn., the price for manufactured milk was $3.59 per hundred. In 1955, the first half of the year, it dropped to $2.95 a hundred which is a drop of 64 cents. My income has dropped accordingly. In fact, since 1952 my net income has dropped too. The reason the farmers are in trouble is due to the surpluses. I have a program here as an individual farmer which I would like to present. I am appearing as a representative of the Fillmore County Farmers Union, but I will just hand that in. As an individual farmer, I recommend the dairy program aimed at 100 percent of parity in the market place, and reflecting fair returns to the farmers by the following methods: First, stop Government purchase of dairy products for storage purposes. The United States is well down in the list of consumption of dairy products. I believe that food bought and paid for by the taxpayers should be eaten by them, instead of being allowed to spoil or be sold at a great loss or given away. A free market for dairy products. That is No. 2. Let prices fall to the level of the market created by the demand. No. 3, a Government support program to assure the family-sized farm not less than 10 percent below a fair price when marketing quotas are not used by direct payments and 1 percent above a fair price for each percent of farmer cut, that is, when he cuts his production, whenever the Secretary of Agriculture recommends it advisable to lower production up to 10 percent. Quotas used could be based on pounds of butterfat produced in previous years on each farm. And not only has milk dropped 64 cents per hundredweight at the local creamery, but the cost of retail milk at Spring Valley has risen from 17 cents a quart to 20 cents a quart in the same time. No. 4, increased consumption by the methods as follows: Expansion of the present school-lunch program. A food-stamp plan to enable people on relief, disabled, or people receiving socialsecurity or old-age pensions to secure necessary dairy products. And here is another article no one else has mentioned before, but it is the chief cause of our dairy problem here in Minnesota. Make it unlawful for butter substitutes to masquerade in the color of butter. I believe that the consumption of butter can be increased to take care of the present surpluses. For instance, the consumption of butter here in the United States has dropped from, I believe, 16 pounds per person to about 8 pounds per person. And if the consumption of butter were increased 2 pounds per person it would take care of the entire present surpluses, according to my calculations. No. 5, the soil-conservation bank in connection with other soilconserving practices. Whenever it is apparent more food is being produced than can be consumed that would become necessary. And an acre set aside for this purpose could be used in the case of severe drought for grazing purposes. And I go on, dairying is a soil-conserving practice. And if butter consumption were increased 2 pounds per capita this would mean the consumption of 300 million pounds of butter per year. That would be the production of over 1 million dairy cattle at present rates of production and would give 50,000 dairy farmers a market for their product. This will save tons of annual topsoil, compared to soybeans and other crops. No. 6, 100 percent parity for grain. Cheap feed means overproduction of milk or meat. I believe no grain should be shipped in here unless the farmers are receiving at least a fair price. No. 7, take farm programs out of politics by cooperation of both. political parties. I believe that we have that here today. This would be achieved by allowing the farmers themselves a democratic right of approving a program such as this by their vote on the program itself. |