EEPORT OF THE SECRETARY OF AGRICULTURE. 7 



during the flush years. The percentage who suffered in this way, 

 however, does not seem to be very large. The farmers' troubles are 

 due primarily to the low prices of their farm products and the high 

 prices for the services and articles they must buy. 



TAXES AND INTEREST. 



In addition to the handicaps just mentioned there is underlying 

 this agricultural situation the fundamental factor of the lowered 

 price level which has shrunk the purchasing power of the farmer's 

 income. Economic justice would require that the price level during 

 the years when the debtor is paying individual and public debts 

 should be as high as when these debts were incurred, thus making it 

 possible for him to meet his fixed payments of taxes, interest, and 

 principal with about the quantity of labor or the products of labor 

 required to meet them at the time the debts were incurred. This is 

 not the case now with the farmer. It is not possible to adjust the 

 price level with that nicety which will do justice to everyone, but 

 in so far as it is possible it should be done. Our investigations lead 

 us to estimate the property taxes and interest combined paid by 

 agriculture in the year of 1920 at about $1,457,000,000; in 1921 at 

 $1,684,000,000; and in 1922 at $1,749,000,000. 



In 1920 practically the entire value of the wheat and tobacco crops, 

 or about two-thirds of the wheat and cotton crops, were required to 

 pay property taxes and interest charges. This was during the period 

 of high prices and lagging charges for taxes and interest. 



In 1921 property taxes and interest were equal to the entire value 

 of the wheat, oats, potato, and tobacco crops. The wheat and cotton 

 crops combined would pay but five-sixths of the taxes and interest. 

 This was during the period of low prices and rising charges for taxes 

 and interest. 



In 1922 the value of the wheat, oats, and tobacco crops, and one- 

 half of the potato crop, were required to pay taxes and interest. In 

 that year although cotton was very high in price, taxes and interest 

 charges were equivalent to the entire value of the cotton crop plus 

 two-thirds of the wheat crop. Property taxes increased from 

 $532,000,000 in 1920 to $797,000,000 in 1922. 



Unfortunately reliable estimates of taxes and interest charges are 

 not available for the pre-war years. It is estimated, however, that 



78007— AGE 1923 2 



