I 



Money and Recovery 



(Continued from page 13) 



high valued dollars means unemploy- 

 ment, low wages, low prices, panic and 

 depression. Plentiful money means 

 cheap money and cheap money means 

 employment, high wages, high prices, 

 progress and prosperity." 



Yet today, Chester Davis showed, 

 bank reserves are the highest in his- 

 tory, in,terest rates are the lowest and 

 unemployment is near an all-time peak. 

 All the money in the world will not 

 bring prosperity if the credit avail- 

 able is not used and if other factors 

 are not right to promote the produc- 

 tion of goods. 



"The great central question, the 

 challenge to the nation," said Mr. 

 Davis, "is this: How may our people 

 be employed in the increasing produc- 

 tion of useful things that will afford 

 a higher standard of living to those 

 who work.' ... If industry and labor 

 will look to full production for in- 

 creased earnings, then we can produce 

 and enjoy a constantly expanding na- 

 tional income. Incidentally, that is what 

 agriculture always has done, and if 

 the rest of the economy will learn to 

 practice it, the treatment necessary for 

 agriculture will be greatly simplified. 



"The job ahead of us is to bring 

 about such a rate of production that 

 all our effective man-power may find 

 useful employment. We are not go- 

 ing to do it unless and until the em- 

 ployers of labor look to increased pro- 

 duction rather than to higher prices 

 for profit; and unless and until or- 

 ganized labor learns that increased pro- 

 duction is the only safe path to higher 

 real wages .... Sooner or later the 

 American people are going to lose pa- 

 tience with an economy that tolerates 

 unemployment and poverty in the 

 midst of potential abundance." 



Commodity and Buying 



Conferences at IVew Orleans 



Ralph Allen of Tazewell county had 48 



head of 1200 lb. cattle on the Chicago 

 market, Dec. 28. Sold by the Chicago Pro- 

 ducers, they brought $11.25 and $9.25 per 

 cwt. They were purchased through the 

 Peoria Producers last March in Kansas for 

 $7.35 delivered. "1 haven't sold a head of 

 livestock anywhere else since the Producers 

 were organized," Ralph said. 



After supervising the construction of mod- 

 ern offices, H. C. "Hank" Morel, manager 

 of the Cooperative Grain and Supply Com- 

 pany of Serena, accompanied by his wife 

 and mother, toured the southern states. 

 They started Nov. 28, visited Palm Beach, 

 Fla., and returned Dec. 12. 



OR the first time in the his- 



Summerfield Farmers Cooperative Grain 



Company, St. Clair county, paid a preferred 

 stock dividend of 4 per cent, a patronage 

 dividend of Vi c^"' ^ bushel on grain and 

 5 per cent on Blue Seal feeds, at its annual 

 meeting, Nov. 26. 



^*~;;^^ tory of national Farm Bu- 



^^_y reau conventions an effort 

 was made to bring together the leaders 

 of commodity marketing and farm 

 purchasing cooperatives at New Or- 

 leans to discuss their common problems 

 and relations to general farm organiza- 

 tions. 



The address of Donald Kirkpatrick, 

 lAA general counsel, on changes in 

 distribution of livestock products fea- 

 tured the livestock conference. Mr. 

 Kirkpatrick showed that the "big four" 

 packing companies have gone out to 

 get the livestock through the acquisi- 

 tion of 60 plants mostly through pur- 

 chases. They operate 117 plants. They 

 have increased their percentage of net 

 sales of all packers under federal in- 

 spection, he said, from 69.3 per cent 

 in 1924 to 72.8 per cent in 1936. They 

 have increased net profits from 68.5 

 per cent to 81.7 per cent. 



"In 1936, 10 packers, including the 

 "big four," handled 83. 2 per cent of 

 the net sales and made 89. 2 per cent 

 of the net profit of all packers oper- 

 ating under federal inspection. 



"While producers of livestock have 

 been splitting up their selling through 

 many channels, packers have been con- 

 centrating, although they have broken 

 up their buying into many small units. 

 Packers have gone direct to individual 

 stockmen or farmers. Stockmen and 

 farmers sell to many more outlets now 

 but a high percentage of the stock 

 purchased finds its way into relatively 

 few strong hands." 



While suggesting that farmers 

 should cooperate with the packing in- 

 dustry, he emphasized that efforts 

 should be made to encourage the buy- 

 ing and selling of both livestock and 

 meats on a standardized basis, that 

 packer buying stations, packing plants, 

 local auctions and other places of pur- 

 chase should be put under fair and 

 reasonable regulation so as to elimin- 

 ate two standards of business ethics 

 and distributive practices ; one for cen- 

 tral markets, one for local markets. 



In the conference on cooperative 

 purchasing H. E. Babcock of the Co- 

 operative G. L. F. Exchange, New York, 

 aggressively developed the thought that 

 cooperative purchasing should not be 

 penalized by using it as a source of 

 income to maintain a general farm or- 

 ganization. 



"There is no room in the field of 

 cooperative purchasing of farm sup- 



plies," he said, "for the check-off sys- 

 tem of building a general farm organ- 

 ization. Furthermore I have yet to 

 see the general farm organization, the 

 support of which was worth a nickel 

 to any sound, adequately-financed and 

 well-managed buying cooperative pro- 

 vided that support had to be purchased 

 through adding to the cooperative's 

 costs of doing business." 



Lloyd Marchant, manager of Illinois 

 Farm Supply Company, presented a 

 well-prepared paper and quoted from 

 charts in which he gave credit to the 

 Illinois Agricultural Association for the 

 splendid and rapid development of suc- 

 cessful cooperative purchasing in Illi- 

 nois. 



"Illinois does not tolerate the 

 thought of paying dividends to farm- 

 ers who are not members of the Farm 

 Bureau," he said. "We are of the 

 firm conviction that farm cooperatives 

 must retain their identity with organ- 

 ized agriculture to be most successful. 

 Cooperatives cannot solve the farm- 

 ers' problems; they cannot substitute 

 for a local, state or national farm or- 

 ganization. 



"The larger benefits of the cooper- 

 ative service should go to and belong 

 to the member of a farm organization. 

 He is the one who has borne the heat 

 and burden of all time. He is the one 

 who is entitled to the benefits for he 

 had made them possible." 



E. T. Winter, secretary of the Ne- 

 braska Farm Bureau, quoted at length 

 from the Farm Credit Administration's 

 study of Illinois Farm Supply Com- 

 pany, soon to be published, to support 

 his contention that Farm Bureau con- 

 trol is a distinct asset to the develop- 

 ment and success of cooperative enter- 

 prise. 



"Farm Bureau control," he said, 

 "puts the interest of farmers first and 

 the interest of the cooperative associa- 

 tion as a corporate entity, second. 

 This means farmer control rather than 

 employee control." He cited the case 

 of a County Farm Bureau oil company 

 in Nebraska which was organized and 

 financed by the Farm Bureau but which 

 paid dividends to all farmers alike. 

 This company gradually became the 

 chief interest of the farmers of that 

 county and today has 780 patrons and 

 is successful, whereas the County Farm 

 Bureau has been allowed to disinte- 

 grate and today has only 40 members. 



"Farmers need other types of ser- 



(To puge 32. Col. 1) 



JANUARY, 1939 



