REPOET OF THE SECRETARY OF AGRICULTURE. 3 



I.OW PRICE FOR FARM PRODUCTS— HIGH PRICES FOR OTHER 



COMMODITIES. 



Among the causes -^vhich contribute to the abnormal relationship 

 of farm prices to the prices of other things may be mentioned : 



Overproduction of many farm crops. 



Continued high freight rates. 



The maintenance of industrial wages at near war-time levels. 



Economic depression and depreciated currency' in European 

 countries. 



Interference with the efficient functioning of necessary industries. 



Unreasonably high costs of distribution of some farm products. 



Some contend that there is no such thing as overproduction of 

 farm products and can not be as long as there are people in the 

 world who suffer for food and clothing. On the same line of reason- 

 ing it can be argued that the production of automobiles will be inade- 

 quate until every man and woman and every boy and girl of high- 

 school age owns one. There is overproduction, so far as the producer 

 is concerned, whenever the quantity produced can not be marketed 

 at a price which will cover all production costs and leave the pro- 

 ducer enough to tempt him to continue production. And whenever 

 there is such overproduction the output will be reduced either by 

 conscious effort on the part of the producers or by the operation of 

 economic laws which drive the less efficient producers out of the 

 business. The fact is that for three years in succession the farmers 

 of the United States have produced more of some crops than could 

 be sold at prices high enough to cover production costs. 



It will never be possible for the farmers to relate their production 

 to profitable demand with the nicety of the manufacturer, both 

 because they can not control the elements which influence production 

 and can not estimate demand as closely. Neither will the farmers 

 ever be able to organize as have the labor unions, and by rules and 

 regulations and disciplinary measures compel obedience to policies 

 adopted. They can, however, bring about a better adjustment of 

 production, and especially of marketing, to the needs and purchasing 

 ability a. possible customers, if they will perfect their organizations 

 and call to their aid men skilled in interpreting conditions which 

 influence supply and demand. Better adjustment of farm produc- 

 tion is worth striving for. Both the farmers and the consuming 



