GENERAL FARM PROGRAM 211 



Farm prices already have come down 1 5 percent since the beginning 

 of last year. The prices paid by farmers have stayed close to their 

 peak level and are currently only about 2 percent under last sununer's 

 level. The purchasing power of what the farmer sells has come down 

 to the lowest point since 1942. 



Under my proposal, the income standard from which price supports 

 would be computed is 15 percent lower than that actually received 

 last year. 



How much lower does the public interest permit farm prices to go 

 without similar cuts for all other groups? 



Let me clear up one other point in this connection. My proposal 

 is plainly not a guaranteed-income scheme. If the farmer's production 

 fails for any reason, price supports do not help him. This proposal 

 does proceed toward an income objective. It does offer a means of 

 computing price supports from a minimum income standard, recog- 

 nizing that we are more fundamentally concerned with income than 

 with price. It does offer a means of extending price support to those 

 commodities which are most important in the farm income picture. 

 But it cannot provide farmers a guaranteed level of income unless 

 Congress should make a flat commitment on every commodity pro- 

 duced by farmers, and I am sure nobody expects this will be done. 

 Under my proposals, farm prosperity would certainly continue to 

 depend upon individual enterprise and abundant farm production, 

 as well as upon high-level employment and purchasing power in the 

 whole economy. 



Let me also point out that this is a price support recommendation — 

 not a consumer subsidy proposal. I have merely recommended those 

 methods of supporting farm prices which will do most to lick the 

 surplus problem by encouraging consumption. There is a considerable 

 dift'erence between subsidizing consumption with the hope that the 

 benefit will triclde down to the farmer and supporting farm prices in 

 ways which will give consumers the most for their money. I am, of 

 course, recommending the latter. The payment method for use on 

 perishable commodities will enable us to go on producing and consum- 

 ing somewhere past the level where straight dollar demand would 

 temporarily stop us. That enables genuine demand and our real 

 productive power to exert greater influence in our economy. 



There have been a number of recldess estimates of the costs of the 

 proposed program for the years ahead. None of the authors of the 

 statements have estimated the cost of the present program. If I 

 understand the estimates correctly, aU of them assume a severe depres- 

 sion and low farm income. I confess that I do not assume a depression. 

 On the contrary, the whole proposal is designed to help avoid a depres- 

 sion by maintaining reasonable farm income. 



Some people may be planning on depression, but the Government 

 of the United States must plan otherwise. By action of the Congress, 

 we are committed to a policy of promoting maximum employment, 

 production, and purchasing power. In my opinion, a strong farm 

 program is an essential of that policy. 



If national income stays high and reasonably weU distributed, farm 

 prices wiU not rest on the supports and, therefore, supports will not 

 be costly. 



If, however, you assume a depression, then you must be aware that 

 farm surpluses and city unemployment will almost certainly force into 



