became alarmed. Corn prices went 

 lower. Industrial prices dropp>ed and 

 the "recession" was on. There was 

 talk of calling a special session of Con- 

 gress, which later materialized. A new 

 measure modeled after the Pope-McGill 

 bill was drafted and enacted in Feb- 

 ruary. It became the Agricultural Ad- 

 justment Act of 1938. 



By the time the new Adjustment 

 Act was signed, farmers in the south 

 were planting cotton, and long before 

 the legislation could be put into effect 

 in the corn belt, many had sown their 

 oats and made their plans for the crop 

 season. The result was that a bare 

 majority of farmers in the 12 corn-belt 

 states participated in the program. Yet 

 because of this Act, farmers who kept 

 within their own acreage allotments 

 in 1938 received a loan of 57 cents per 

 bushel on sealed corn less the cost of 

 administration. This was substantially 

 higher than the open market price. 



Has tft^^AA had any influence on 

 acreage planted to corn? For 10 years 

 before there was any adjustment pro- 

 gram U. S. corn acreage averaged ap- 

 proximately 102,000,000 acres. In 1931, 

 1932 and 1933 it ranged from 105,- 

 963,000 to 110,577,000 acres. Low 

 corn prices increased the acreage be- 

 cause farmers felt they had to make 

 up in volume what they lacked in 

 price to meet their obligations. 



Last year farmers produced a crop 

 of 2,542,238,000 bushels from 91,792,- 

 000 acres which compares with 96,- 

 483,000 acres planted in 1937. The 

 estimated corn acreage planted for 1939 

 is 90,734,000 acres. These production 

 figures disclose the growing respect for 

 and belief in the soundness of the corn 

 adjustment program by the farmers of 

 this and other cornbelt states. Ideal 

 growing weather throughout the corn 

 belt this year promises to bring forth 

 another abundant crop. The estimated 

 yield as of Aug. 1 is 2,459,888,000 

 bushels which, of course, is subject to 

 revision as the crop more nearly ap- 

 proaches maturity. This is the third 

 heavy crop in succession. Yet in the 

 previous three-year period two crops 

 were far below normal. It seems 

 only the part of wisdom to carry over 

 a substantial surplus from year to year 

 as a protection against a recurrence of 

 the conditions of 1934 and 1936. 



THIS IHOiTH 



By Earl C. Smith 



(Continued from page 3) 



Arrangements are being made now 

 to reseal and store a substantial part 

 of the 1938 corn crop for another year. 

 Announcement will be made early this 

 fall as to the amount of the loan on 

 the '39 crop. The final estimates of 

 yield and carry-over will determine the 

 exact amount of the loan which I feel 

 sure will be in excess of 50 cents a 

 bushel. Cooperators in the 1938 corn 

 adjustment program received approxi- 

 mately 65c net for their corn. Coop- 

 erators in the 1939 corn adjustment 

 program are assured of even a better 

 price through the corn loan, adjust- 

 ment and conservation payments. When 

 this net return is compared to the open 

 market prices, it is difficult to under- 

 stand how any farmer or any other 

 thinking citizen could stamp the AAA 

 a failure at least so far as the corn- 

 belt is concerned. 



anywhere else. It appears that farmers 

 now have their first opportunity to 

 furnish the final answer as to whether 

 or not they believe in the soundness of 

 these principles to the extent that they 

 are determined to make them work. 



Without the AAA where would corn 

 prices be today? Long experience un- 

 der the free operation of the law of 

 supply and demand strongly indicates 

 that not only would farm prices have 

 been much lower in the immediate 

 past, but we would experience extrem- 

 ly low prices this fall. 



If the same percentage of the 1939 

 crop is sealed as last year we will have 

 only about a half billion bushels under 

 loan. Should farmers or anyone alse 

 become alarmed about 500,000,000 

 bushels of sound corn in storage and 

 under farmers and government control 

 on farms? Is it not only the part of 

 wisdom and prudence to have such a 

 surplus to tide us over a possible re- 

 currence of the conditions of 1934 when 

 choice livestock was slaughtered and 

 valuable herds depleted through lack 

 of feed? Should the American public 

 refuse to offer reasonable protection to 

 the farmer against allowing such a sur- 

 plus to ruin his price level when he 

 is protecting the country against a food 

 shortage with attending famine prices? 



Within the next few weeks corn- 

 belt farmers will decide whether they 

 are going to hold their sealed corn 

 on the farm and thus help make the 

 ever-normal granary become effective 

 or whether they are going to force 

 the Government to take delivery and 

 ultimately become both a buyer and 

 seller of grain. 



When supporting the AAA of 1938 

 before Congress, particularly its man- 

 datory corn-loan provision, representa- 

 tives of farmers insisted upon securing 

 the cooperation and support of Govern- 

 ment to the extent necessary to afford 

 farmers an opportunity to control the 

 corn surplus. It was contended this 

 could be accomplished more econom- 

 ically and effectively on the farm than 



With adequate cooperation in ad- 

 justing acreage next year, while main- 

 taining a surplus under control, farm- 

 ers can, if they will, improve prices 

 for their basic commodities. Some 

 say that the Triple A program has 

 failed. Others say that the program 

 is on trial. I do not believe either 

 is true. Rather I believe that the farm- 

 ers of America are on trial, that they 

 alone can determine whether or not 

 this plan is to work and secure the 

 desired results. With reasonable co- 

 op>eration farmers need have no fear 

 over loss to themselves or the govern- 

 ment from the crop loan program. 

 Shall we listen to those advocating a 

 return to the old order which gave us 

 12-cent corn, |3 hogs, and 35-cent 

 wheat, or shall farmers stand together 

 and adjust their production and control 

 farm commodity surpluses to a price 

 level that will sustain farm buying 

 power and a fair standard of living? 

 Farmers will decide, and I have faith 

 that their decision will be in the best 

 interests of the great agricultural in- 

 dustry and the nation. 



AAA Amendments— 



The effect of amendments to the 

 Agricultural Adjustment Act recently 

 enacted by Congress are: (1) to place 

 farm marketing quotas for corn, cotton, 

 and wheat all on same basis; (2) mar- 

 keting percentage for wheat and corn 

 be 100 per cent of the farm acreage 

 allotment; (3) referendums on corn 

 marketing quotas be held one month 

 later at the end of September instead 

 of August as previously provided. 



The farm marketing quota for wheat 

 is the normal or actual yield, which- 

 ever is greater, of the farm acreage 

 allotment, plus the carryover on the 

 farm which might have been marketed 

 in previous years without penalty. The 

 farm marketing quota for corn does 

 not include the carryover. Previous 

 provisions required farmers to hold 

 part of their corn and wheat when 

 there was a marketing quota imposed, 

 even if they had planted within their 

 acreage allotments. 



Plowing will begin in the 62nd an- 

 nual Wheatland Plowing Match at 

 8:30 Saturday morning, September 9, 

 on the Byron Haag farm 4 miles north 

 of Plainfield on route 59- 



L A. A. RECORD 



