i 



Anti-Tnist Lows 



(Continued from page 9) 



once a law was passed, a reform was ac- 

 complished. The failure to keep sym- 

 pathetic administration in charge of the 

 law and most of all failure to demand 

 a judiciary sympathetic with the needs of 

 the people, instead of responsive to the 

 desires of the trusts, have rendered the 

 results of the laws disappointing. 



This failure to enforce the antitrust 

 laws, and the restrictive interpretations 

 placed upon them by the courts, per- 

 mitted the development of the conditions 

 which led to the experiment in industrial 

 control known to history as the N.R.A. 

 Had the Sherman Antitrust Law been ef- 

 fective to preserve competition and the 

 Federal Trade Commission Act effective 

 to prevent unfair competition much of 

 the N.R.A. experiment would not have 

 been necessary. 



Meanwhile, our economy has been the 

 subject of various dislocations by virtue 

 of the competitive struggle for advantage 

 and privilege at the hands of govern- 

 ment. The great industries have insisted 

 upon having tariff advantages of im- 

 measurable value. These tariff advantages 

 permitted them to charge high prices for 

 their products. The farmers were obliged 

 to pay the prices. The farmer has justly 

 insisted upon some kind of benefit which 

 would offset the benefit that he was 

 obliged to pay to the great industrial in- 

 terests. These benefits in turn had to be 

 raised by taxes, and this has created no 

 small part of the modern question of 

 taxation about which industry now com- 

 plains. 



Farmers Invented It 



Why did the farmers and the farm 

 leaders invent the antitrust idea? Like 

 most other influences it was bom of sheer 

 necessity. In the days of the granger up- 

 rising the farmer had begun to see him- 

 self surrounded by big business. As in- 

 vention had tended to make farming a 

 machine process, he found himself com- 

 pelled to buy more utensils — and vastly 

 more expensive utensils — from great in- 

 dustrial combinations. On the other 

 hand he saw great combinations coming 

 between himself and his consumers. He 

 had once dealt pretty directly with the 

 consumers of his products, or at least he 

 was enabled to exercise his well known 

 talent for bargaining with competing 

 groups of buyers. At about this period 

 of our history he found, however, that 

 between himself and his consumers big 

 business combinations were intervening. 



The farmer had not yet learned to buy 

 cooperatively or to sell cooperatively. The 

 individual farmer felt a terrific disad- 

 vantage in bargaining with powerful 

 combinations. He could not choose the 



time to sell his produce. He had to dis- 

 pose of it in order to pay his taxes, or 

 buy his winter clothing, or meet his ma- 

 chinery notes. He could not bargain as 

 to price but received a proposition which 

 he could take or leave. He became fear- 

 ful of his ability to survive, hemmed in 

 on both sides by industrial combinations 

 whose power and resources overwhelmed 

 him. The antitrust laws promised him 

 relief. After 47 years what relief has 

 he had.' 



No Bargaining Power 



The simple fact is that the farmer, 

 except to the extent that he buys or sells 

 cooperatively, is in exactly the position 

 today that the grangers of 1890 feared 

 he would be. 



Let us consider the farmer as an in- 

 dividual seller. When the farmer at- 

 tempts to sell his produce he has no 

 bargaining power that compares with that 

 possessed by his only buyers. He finds a 

 concentrated control and ownership of 

 the only channels by which his produce 

 may reach its ultimate market. Thirteen 

 manufacturers bought 64 per cent of the 

 1934 tobacco crop; three manufacturers 

 alone bought 46 per cent of the 1934 

 crop. I take it no one will doubt that 

 when three buyers take 46 per cent of a 

 crop those three are in a position to fix 

 the price. They would be strange per- 

 sons if they did not take advantage of 

 the power they have. Thirteen com- 

 panies bought 65 per cent of the com- 

 mercial wheat crop in the fiscal year 1934 

 and 1935, and here again three of those 

 companies bought 38 per cent of the 

 commercial crop. Ten packers in 1934 

 bought 51 per cent of the cattle and 

 calves and 37 per cent of the hogs. 

 Thus big business has thrust itself be- 

 tween the producer and the consumer and 

 is in a position to dictate terms to each. 



Let us consider the farmer as a buyer 

 of materials, supplies, machinery and 



equipment for production purposes. 

 These purchases are business transactions. 

 The machinery cost and the cost of fer- 

 tilizer are important factors in the cost of 

 production. I recall my grandmother's 

 lamenting one day that farm machinery 

 had ever been invented. It may not have 

 been a progressive sentiment or sound 

 economics. She said to me that when 

 they had cut grass with a scythe, raked 

 hay by hand and cradled the grain and 

 threshed with a flail, they had been able 

 to prosper better than after it became 

 necessary to have farm machinery; that 

 from the time they bought a horse mower 

 she could not remember of ever being 

 out of debt either for additional machin- 

 ery or replacements. Maturities of ma- 

 chinery notes and interest were added to 

 taxes, crop failures and pests as farm 

 worries. 



Here's Inequality 

 Based on prices paid and received by 

 farmers and using the 1925 to 1929 

 average as 100 per cent, the prices re- 

 ceived for all farm products fell in March 

 of 1933 to 37 per cent of normal. Farm 

 machinery, at its lowest, fell to 88 per 

 cent, fertilizer to 72 per cent, building 

 materials for the farm to 74 per cent, 

 and equipment and supplies to 69 p>er 

 cent. The fall in farm produce was 

 double the fall in fertilizer, farm ma- 

 chinery and farm supplies. Further, by 

 September of 1937 the index of prices 

 received for all farm products had 

 reached a recovery figure of 80 per cent. 

 But farm machinery had kited to 102 

 per cent, building materials for the farm 

 to 98 per cent, and equipment and sup- 

 plies to 82 per cent. Those industries 

 that recovered at the expense of the 

 farmer recovered mudi faster than farm 

 prices. Looking over the industries that 

 enjoyed this advantage we find them to 



(Continued on page 16) 



JANUARY. 1938 



11 



