Mr. EDMUNDS. That is right. I think the determination of parity alone would equate one area with another. That is done by a formula that I believe Congress passed.

The CHAIRMAN. What weight would you give to the freight rate and the distance in miles?

Mr. EDMUNDS. I think that your freight rate, Senator, has to be solved within the industry. Let me put it this way: We have a freight rate against us in Aroostook County very definitely.

The CHAIRMAN. That is why I bring up the subject. In other words, from Vermont I imagine you could ship potatoes to New York or Boston cheaper than you could from the State of Maine?

Mr. EDMUNDS. Parity figured on the farm would have to be used as the basis of determination.

The CHAIRMAN. You mean the area?

Mr. EDMUNDS. The area or the State.

The CHAIRMAN. The area or the State, all right.

Let us go back to the matter of raising these funds and their payment. How would you work that out? You would want that to come from the Treasury?

Mr. EDMUNDS. Of course it is hard for me to say.

The CHAIRMAN. Tell me how to do it.

Mr. EDMUNDS. One way is for Congress to appropriate a certain amount of money to be used for purposes of maintaining a parity price, and the farmers, if they accepted this plan, would also have an equal responsibility to contribute to that amount of money. The CHAIRMAN. So it would be a joint venture?

Mr. EDMUNDS. Right.

The CHAIRMAN. As I understand your plan, in any State wherein 90 percent brought less than $3.50, as an example in Maine, and in another place $5.50, as in Florida, if those potatoes in Maine and potatoes in Florida sold for, let us say, in Maine instead of $3.50, they sell for $2.50, that would be $1 difference?

Mr. EDMUNDS. That is right.

The CHAIRMAN. You would want a program whereby you could sell, that is, the farmers could sell at $2.50 with the expectation of the Government providing the $1?

Mr. EDMUNDS. If we had to sell at $2.50, that is right.

The CHAIRMAN. I am assuming that.

Mr. EDMUNDS. That is right.

The CHAIRMAN. In Florida the potatoes sold for $3 instead of $5.50, you would want the Government to put up $2 between that and $5.50? Mr. EDMUNDS. That is right. That is the way we understand it. The CHAIRMAN. You have heard of the so-called Brannan plan? Mr. EDMUNDS. Yes.

The CHAIRMAN. Is it along that line?

Mr. EDMUNDS. I think it is very similar to the Brannan plan. The CHAIRMAN. You know how that plan was lambasted all over the place?

Mr. EDMUNDS. Yes, sir. And I also know it has been fairly successful in wool-a somewhat similar plan.

The CHAIRMAN. It has not worked yet in wool, I was told this trip. We had quite a bit of hearing on that. The only difference between the wool and the potato proposal that you are making is this, and I want to say that I voted against the wool bill-no ifs and buts about it.

That is my position. There is a compensatory payment, but that amount in order to meet that payment comes from taxes that are collected, called tariffs, and that amount will be used to compensate the producer. In other words, since we do not produce all of the wool that we need in this country it was thought by the proponents of this bill that we ought to encourage the production of wool at a certain level, so that in case of war or an emergency we would at least have that much wool that we could depend upon. That was the purpose of that. You concede that situation does not prevail as to potatoes? Mr. EDMUNDS. That is right.

The CHAIRMAN. Can you not also concede that since that is not the case, that this cost may be quite a drain on the Treasury?

Mr. EDMUNDS. No, sir, I cannot, for this reason: Our plan is based on strict production controls in terms of bushels that can be marketed and it is a very well-established fact that the State of Maine, for instance, can ordinarily market about 48 or 49 or 50 million bushels. There would be no responsibility on the part of the Government, except for that proportion of the crop that went to market for fresh use. There would be no responsibility for potatoes that were, let us say, not of sufficient quality to go to market and were not included in marketing quotas.

The CHAIRMAN. The amount of these compensatory payments that you speak of, would that amount be determined from a national average or on the regional and season basis?

Mr. EDMUNDS. I would say it would have to be on a regional average, because of the computation of parity on a regional basis. It has to be. The CHAIRMAN. That is why you would have a different price formula?

Mr. EDMUNDS. That is right.

The CHAIRMAN. For the various regions. How would you describe a region-what would you call Idaho and the Dakotas, would you put them in one?

Mr. EDMUNDS. I would say that a region is an area that produced upwards of 7 or 8 million bushels of potatoes. Let us say, a surplus State, an area that became a surplus State rather than a deficiency State should be treated as an individual. Parity is figured for each of those States.

The CHAIRMAN. Where would you put California?

Mr. EDMUNDS. I think that California would have to have parity figured for the State of California alone.

The CHAIRMAN. Where would you put Oregon?

Mr. EDMUNDS. I would say the same thing.

The CHAIRMAN. That is, each State would have a different formula? Mr. EDMUNDS. That is right.

The CHAIRMAN. Where would you put Florida?

Mr. EDMUNDS. I would say the same thing for Florida.

The CHAIRMAN. You speak of regions. Can you name some States in which you could put them in the same region?

Mr. EDMUNDS. Yes, sir. I think that there might be possibilities in the other five New England States, if they wanted to be included as a region. They now operate under a feed marketing order as a region, whereas the State of Maine has an individual order. And I might say in New Mexico, Arizona, possibly Texas, that might be a

region and possibly Louisiana, Mississippi, Alabama might be a region.

The CHAIRMAN. You can almost count Louisiana out because we are out of it practically.

Mr. EDMUNDS. I say the production in those areas is so limited that it would seem impractical to set up a separate program, but States that produce, let us say, upwards of 7 or 8 or 9 million bushels of potatoes, or in the case of

The CHAIRMAN. You mentioned a while ago exempting 3-acre people?

Mr. EDMUNDS. Yes.

The CHAIRMAN. You would not want to put him in the picture at all, you would leave him out?

Mr. EDMUNDS. I think it would be essential that you not reduce it below 3 acres, both from the administrative standpoint-there are something like seven or eight hundred thousand, 3-acre farmers.

The CHAIRMAN. Irrespective of whether he grew potatoes before or after?

Mr. EDMUNDS. I think that he would be able to grow all the potatoes he wanted up to 3 acres.

The CHAIRMAN. No matter whether he grew potatoes or not?
Mr. EDMUNDS. That is right.

The CHAIRMAN. And you would have no control over his production?

Mr. EDMUNDS. That is right.

The CHAIRMAN. But he would get the benefit of this price-he would get the compensatory payment, also?

Mr. EDMUNDS. He would not get the compensatory payment, either. He would be outside of it. He would get the benefit in this way, if production controls tended to hold the market at a level of a fair return to the grower, he would sell his potatoes, and get a fair return.

The CHAIRMAN. Would it not be possible, if we had too many 3-acre boys to affect the market a good deal, because that happened in many other basic commodities, you know, by putting no limitation on production as to certain farmers with certain areas. They produced heavily, and that had the effect in many instances-I would not say of glutting the market, but producing just that little surplus between 2 and 5 percent which caused a downward trend in the prices.

Mr. EDMUNDS. Under a program today parity is considered lower than it was 7 or 8 years ago, so far as potatoes are concerned, and there would not be the attraction for that 3-acre grower to get into business.

The CHAIRMAN. But, you are assuming that the parity formula would remain as it is. We have had testimony to change it, it does not work any more. The price is too low.

Mr. EDMUNDS. I did not know that there had been.

The CHAIRMAN. The record is replete with that. We have to change that. Some want to go to the old parity and revise that a little bit and do away with the modern parity, where you add a year and drop one. It is only in a few cases where that formula has provided what growers of certain commodities think ought to remain there, but others are against it. It may be that some change will be made in that regard. Mr. EDMUNDS. I think it is also true, Senator, that the production of potatoes over the past 30 years has shifted from around 3 million acres to around 1,200,000 acres that are grown commercially in this

country. And at the same time from two or three hundred thousand so-called commercial producers to around 30,000.

The small producer, because potatoes have not been attractive enough, cannot afford to own the necessary potato machinery to cultivate 3 acres of potatoes. I do not anticipate this would encourage a lot of 3-acre growers.

The CHAIRMAN. You would be surprised. Do you envision in your plan which, as I understand it, is now both bushelage and acreage— so many bushels, so many acres-to produce that bushel-——

Mr. EDMUNDS. That is right.

The CHAIRMAN. Suppose you produce a little more than that, what would you do with the surplus!

Mr. EDMUNDS. If I could just go through my plan again.

The CHAIRMAN. I mean, just let us be practical about it. How would it work? I am trying to get how it would work. You see, we have to draft a law in order to make it applicable to all parts of the country to meet your test.

Mr. EDMUNDS. That is right.

The CHAIRMAN. Let us assume now that you have a quota of 350 million bushels. Let us say the production is 400 million bushels. What would you do with the 50 million?

Mr. EDMUNDS. As I pointed out in my program, if farmers generally lived within their acreage allotment, each farmer should probably be eligible for a section 32 program, similar to what we have today at the discretion of the Department of Agriculture and at least then the cost of production, so there is no encouragement for a farmer to try to wreck a program. We feel that a program just would not work in potatoes, because of the varying yield from year to year unless you include both.

The CHAIRMAN. I have other questions, but Senator Holland has some that he wants to ask. He is from Florida where they produce mighty nice potatoes.

Mr. EDMUNDS. I have some very good friends in Florida.

Senator HOLLAND. I have been interested in your testimony, Mr. Edmunds. You remember, of course, that when the support price fiasco in potatoes came to an end, that the Association of Potato Producers in Florida was very strongly instrumental in bringing about that end, that it took a very strong position

Mr. EDMUNDS. That is right.

Senator HOLLAND (continuing). Against continuance. I have had no evidence at all that they have changed their position upon that matter. Have you had any such evidence?

Mr. EDMUNDS. Not that they have changed their position substantially. We have some good friends in Florida. I question whether they would support this program. At the same time, we are going to present this program as we have outlined here today to the National Potato Council in Chicago next week, and representatives will be there from Florida. We hope we will get an endorsement of all of the things on this program. We know that it will not be unanimous, but we hope to get an endorsement.

Senator HOLLAND. Neither my State nor any other has the right to veto a national program of importance, but I do recall that my people very strongly were against the other program under which,

as you will remember, they simply planted more hills of potatoes in the row.

Mr. EDMUNDS. That is right.

Senator HOLLAND. And put the rows closer together, put on more fertilizer, and the net result was such that even though they had an acreage allotment figure, that was greatly reduced, the support program was reduced to 60 percent, as I recall, of parity, from 90 percent

Mr. EDMUNDS. At the industry's request.

Senator HOLLAND. Yes; at the industry's request, yet still the industry's production cost the Federal Government something like half a billion dollars-something like $500 million in such quick time that the whole Nation revolted against it.

Mr. EDMUNDS. I believe that is right. That is the reason-the only reason why we ask for both bushel and acreage controls, because you cannot control the production which determines the price of a crop of potatoes in the United States by acreage alone. At the same time, I question whether it would be in the good interest of the country to try to determine by the bushel quotas alone.

What we ask is that you establish or that the Department establish, an acreage allotment for the Nation, let us say, of 1,200,000 acres, which conceivably might grow 450 million bushels of potatoes with ideal conditions, and that they go a step further and they say that whoever complies with his acreage controls broken down on an individual basis will be eligible for his share of the national marketing quota, let us say, of 340 million bushels.

We know that the fallacy of the old program was acreage control. That is, alone with nothing to cover the bushels.

Senator HOLLAND. You know, of course, there are two separate areas of potato production in California. Do you know what the attitude of those areas, or either of them, is toward this program?

Mr. EDMUNDS. I think I can say very safely that the early potato areas in California would be opposed to it.

Senator HOLLAND. That is south California?

Mr. EDMUNDS. Primarily for the reason that they are now growing a lot of cotton and they were the one segment of the potato industry that was in favor of abandoning cross compliance. They wanted a chance to take their diverted acreage taken out of cotton and to put it into potatoes and other crops with nobody governing them.

The late areas, up in Shafter and the northern part of California I feel quite confident will endorse this program or a somewhat similar program to this, because they feel very much the same way we do. I have talked to them.

Senator HOLLAND. You know that the south California area and the Florida area, the other earlier areas, do not feel that there is a direct competition between their product and yours?

Mr. EDMUNDS. That is right.

Senator HOLLAND. In that they sell for a higher price or are of a different quality, cannot be held, are in a sense a de luxe item and not eaten generally as are the standard white potatoes, the firm ones, such as are produced by the State of Maine and other places.

What justification would you feel there would be for including those early soft potatoes which are not strictly competitive, in a program which the producers would not approve and in which they