222 GENERAL FARM PROGRAM 



The Chairman. Taking that as an example, how will your proposal 

 apply to the pork situation if the price goes down to $16.50 today? 



Secretary Brannan. Mr. Chairman, the example which I gave is a 

 very realistic one. I think the support price today, under the existing 

 law, is about $16.50, or in that neighborhood. We took the $16.50 

 as a real figure. Last year we set as a production goal approximately 

 20,000,000,000 pounds of live hogs. We estimated w^ might get 

 another billion pounds over that. In other words, we will get about 

 21,000,000,000 pounds of hogs. The minute that the price goes below 

 $16.50 it would indicate that the obligation to return to the farmer 

 $16.50 a hundred pounds of live hogs must be fulfilled by going into 

 the market and withholding hogs from the market, and that is the 

 authority that we have today. 



Under our proposal, in place of withdrawing the hogs from the 

 market we would allow them, to seek their level in the market place, 

 and if that additional one billion pound of hogs forces the price down 

 seven percent, or $1.10, with the same am.ount of money we would 

 have used to withdraw the hogs from the market we could have paid 

 the farmers $1.10 per hundredweight for live hogs, and the farmer 

 would have had the same return, and the consumer would have had 

 hogs at seven percent less, and also had another billion pounds of 

 hogs to eat. 



Tlie Chairman. And the same situation could be applied to milk 

 and other perishable commodities? 



Secretary Brannan. It certainly could be applied to most. of the 

 commodities that have an elastic demand. 



The Chairman. Mr. Hope desires to ask you some q^uestions. 



Mr. Hope. Mr. Secretary, I think your statement today has 

 cleared up some questions that were in my own mind, and no doubt 

 in the minds of many others, particularly with reference to the objec- 

 tive of the program, and I am referring now to what you say on page 

 five to the effect that this is a price support program and not a 

 consumer subsidy program. 



I think that the impression of many people, gained through the 

 discussions of the program in the press and over the radio by com- 

 mentators has been that it is a consumer subsidy program, and I am 

 glad that your statement today is to the effect that it is not intended 

 to be a consumer subsidy program. 



Now, through the years, since the parity price concept was placed 

 in the Agriculture legislation, we have proceeded with the idea that 

 parity prices were fair prices, fair not only to the farmer but fair to 

 the consumer. The thing that disturbs me a little bit about your 

 program is that we are going now to a different basis, that is, an 

 income rather than a price basis. I do not know that I want to dis- 

 agree with you too much on the basic question, but I am wondering if, 

 since the public generally has accepted parity prices as being fair 

 prices, if we go to some other basis for measuring the return to the 

 farmer, that we may not be losing, as far as the farmers are concerned, 

 some of the benefits that have accrued because of the acceptance of 

 the idea that parity prices were fair prices, both to the consumer and 

 to the producer. 



Would you want to comment on that? 



Secretary Brannan. Yes, Mr. Hope. First of all, let me say that 

 I realize there is some element of boldness, and particularly boldness 



