The A.A.A. 

 of 1937 



By EARL C. SMITH* 



^Si. HE A.A.A. of 1937 pending in 

 — r* the Senate of the United States 

 ^^ at this moment is a sincere ef- 

 fort to brin^ stability to America, to re- 

 Store a balance between agriculture, in- 

 dustry and labor. We hear a lot about 

 this, that and the other that is in the 

 bill. TTiat is just mechanism. The pur- 

 pose is to restore balance, to remove the 

 maladjustment as between these three 

 great economic groups, and to which be- 

 longs directly or indirectly every citizen 

 of America. 



Throughout the years, and particularly 

 since the turn of the century, artificial 

 stimuli such as tariffs, corporate devel- 

 opment and corporate agreements, com- 

 binations of every kind and character, 

 monopolies, both within industry and 

 labor that we heard something about last 

 night, have resulted in maladjustment 

 from the original intent of our fore- 

 fathers when they founded this nation as 

 a nation of free men, and wherein it was 

 intended that initiative and frugality and 

 right living should largely determine each 

 individual's future. 



We are hearing a lot about this bill 

 constituting some 80 odd pages of litera- 

 ture or words. That is correct. But 

 there is printed upon about 12 pages the 

 fundamentals of this legislation. It has 

 a purpose clause, which takes up con- 

 siderable space, it has legislative findings 

 prepared by attorneys so as to point out 

 the legal reasoning, the legal structure 



• Editor's Note ; Excerpts from address before 

 ■nnual convention A.F.B.F. Chicago, Dec. 14, 

 19J7. The bill passed the Senate Dec. 17 by a 

 »ote of 19 to 29. The House bill passed Dec. 11. 

 A conference committee of House and Senate mem- 

 bers will attempt to compose differences and bring 

 out a measure for submission to both houses for 

 final adoption. 



*1T DOES NOT PROVIDE AN ECONOMY OF SCAHCTTY; 

 rather it definitely provides an economy of plenty." — Earl C. 

 Smith speaking before AFBF Convention in Chicago. 



upon which the act is founded, to assist 

 lawyers in their reasoning, particularly 

 during constitutional considerations. It 

 has many, many pages that set forth con- 

 sumers' safeguards and amendments that 

 are necessary for the weaving of this par- 

 ticular structure into the soil Conserva- 

 tion Act so as to remove conflict as be- 

 tween them. But when you get right 

 down to the real fundamentals of the 

 bill, I think if you could properly inter- 

 pret about 1 2 pages you could understand 

 the bill and its workings and its intents 

 and its purposes. If .1 believed that the 

 A.A.A. of 1937 was as complex as some 

 of our newspapers and political friends 

 would have you believe, I certainly 

 wouldn't have had the courage to stand 

 here before you this morning with the 

 brief preparation that I have been per- 

 mitted to give, to my remarks. 



First, may I say something about what 

 is not in the bill, and particularly if 

 there is a representative of the Chicago 

 Tribune here. // does not provide an 

 economy of scarcity. Rather, it definitely 

 provides an economy of plenty. 



And then the one most important fea- 

 ture in the bill — it gives to farmers 

 something they have never enjoyed in 

 this country, the opportunity through co- 

 operation to control their own surplus 

 supplies rather than, as in the past, to 

 let them become the proj>erty of the 



■ 



"If the fanners are urilling in the national in- 

 terest to protect the consumers' interests as well 

 as their own, should not the people who are pro- 

 tected by that production and carry-over pay 

 the cost of Iceeping the Surplus front brealcing 

 the price?" • 



speculators, resulting in widely fluctuat- 

 ing prices. 



Now I submit to this audience that if 

 the f>eople who by the sweat of their 

 brow and through the payment of the 

 largest percentage of taxes in proportion 

 to wealth that are paid by any other 

 group in this nation, cannot be permitted 

 to control their own surplus products, 

 then something certainly is wrong in 

 America. And that is the fundamental 

 purpose of this legislation. 



Secondly, to all of you folks from the 

 wide areas of America who are interested 

 in the Soil Conservation Act, the pro- 

 ducers of other than these great basic ex- 

 port crops, the A.A.A. of 1937 does not 

 change in any respect the effect of the 

 Soil Conservation Act as related to all of 

 these other crops. It does class what has 

 been known as Class 1 payments under 

 the Soil Conservation Act for the pro- 

 ducers of corn, wheat and cotton, and 

 did for a time as presented to the Senate 

 by your organization provide similar 

 treatment of rice. It substituted for Class 

 1 payments what are known as price ad- 

 justment payments that we will discuss a 

 little later. 



Now how does it provide control of 

 surplus supplies.' First, through a definite 

 schedule of commodity loans. Secondly, 

 through Congress providing for volun- 

 tary cooperation by farmers for the ad- 

 justment of production so as to keep sur- 

 pluses from running away from us, 

 breaking down, or, as Henry Wallace 

 says, "overflowing the ever normal gran- 

 ary." 



Now, number three, when supplies 

 reach excessive levels over and above 

 anything we have exfjerienced normally, 

 it provides definitely for marketing 

 quotas upHjn every individual who pro- 

 duces these commodities for market, 

 whether they are cooperatively-minded or 

 of the individualistic school 



Now, every farmer and every farmer's 



JANUARY. 1938 



