ipli- 



0K(;AN1ZED taninrs witli tho 

 aid of a sympathetic admin- 

 istration mado possibK' the 

 program that put fourteen agricul- 

 tural commodities at or neai- i)arity 

 price. The same force that raisc>d 

 prices must keej) them there. The 

 .Ajrricultural Adjustment Act pro- 

 vides the authority for makinp the 

 program effective. Through the 

 processing tax it creates the nec- 

 es.sary incentive for farmers to ad- 

 just production to demand. This 

 procedure is absolutely essential to 

 regulate price. 



.Adjustment of production to de- 

 mand also makes it jiossible for the 

 taritr to become effective on ajrri- 

 lultural commodities. Surpluses of 

 agricultural crops nullify the effect 

 of the tarifl'. Farmers almost 

 Nvithout exception receive the 

 iiighest prices for their tariff-pi-c- 

 tected products when theie is a 

 slight imi)ortation of these prod- 

 ucts. Farmers lose the most money 

 when they are i)ro<iucing for ex- 

 poit at a price below the cost of 

 production. 



Only a little more than two 

 years ago American agriculture 



was at tlie lowest ebb in i)urchas- 

 ing i)ower since the turn of the 

 century, and befoie. The chart on 

 this page shows that in .January 

 the farm price of 14 basic com- 

 modities was slightly above .50 per 

 cent of the l*)(t!t-i;»i 1 pre-war i>e- 

 riod. With the passage of the .Ad- 

 - justment Act in the spring of ID:'.:', 

 and America's departure from the 

 gold standard of .$2(l.<)7 per ounce. 

 farm prices gradually l)egan their 

 upward climb. 



Benefit payments Ix'gan tn make 

 their appearance lirst to the wheat 

 and cotton farnu rs. helping to 

 swell farm income and ease tin- 

 burden of interest, debt, and taxes. 

 Federal farm refinancing at kiwei 

 rates of interest, made possible b\ 

 the Farm F.ureau's long tight for 

 an adecjuate iiedit system, 

 brought relief l<> thousands, llui 

 mounting fai-m prices overshad- 

 owed ever.\thing else in biinging 

 relief from the ti'rrible conditions 

 of I'XVl (with its bumi>ei- crops) 

 and early 19:5.'.. 



To those who claim the drouth 

 of 19;^>4 was responsible for ail the 

 improvement in prices. I suggest a 



glance at tli<' cliart. Note how far 

 t'arm price recover> had gone long 

 befoie 15).'M crops were planted: 

 'ihis was due to the crop a<fiust- 

 ment and gold revaluation I'ro- 

 gi'ams. both vigorously supported 

 by tlu' Farm F.uieau. 



.As farm prices rose, tactoiv 

 payrolls increasCii. Farmers wen 

 liack in the market as buyers, 

 .^ahiries and wages wer*- laiseil. 

 Improved nty -fiurdiasing p<-wt r 

 (('oiitinue<l on i>agi IT I 



ittli 



'I NK, 1M.5 



l.J 



