GENERAL FARM PROGRAM 229 



Secretary Brannan. Mr. Hope, I recognize that we can never 

 make a definite prediction of the production of a specific commodity a 

 year in advance. Therefore if you start out with a fixed price support 

 level I just say again that you cannot fit it to the supply and demand, 

 and that it would be much better to set out with your eye on the over- 

 all income as the objective, because then you have at least your dead 

 reckoning point to which you can tie with reasonable certainty. I 

 would have my eye on the objective, and relate that to the given 

 commodity, in reaching that objective, in attempting to establish 

 price support. I would certainly be, and I am sure the committee 

 would want me as Secretary of Agriculture to be, maybe on the high 

 side of production because we certainly do not want to face the 

 problem of shortages. And, if we get into excessive production, where 

 we have a tremendous amount of some specific commodity, as we did, 

 for example, in potatoes last year, the next year we would have to set 

 the goals a little tighter. For example, we set the goals last year on 

 potatoes, but we did not have very substantial compliance by all of 

 the commercial potato growers; we had compliance of something 

 like 28 thousand out of some one-hundr^d-thousand-odd-commercial 

 potato growers, and it was the fellow who stayed outside the program 

 and sold his potatoes on the commodity market, because he could 

 undersell by 2, 3, or 4 cents a bushel, who took advantage of the pro- 

 ducers who were complying, and the net result of that was that we 

 lost a lot of money and the public got potatoes at a pretty high price. 



If we had turned it around, the obligation would not have been so 

 high; the expenditure would have been an extremely small percentage 

 of the loss last year, and the potatoes could have gone down to a 

 dollar. 



I know, from reading the newspapers, that it sounds a bit legerde- 

 m.ain, as if we were trying to explain away something that happened, 

 and I do not want us to have to keep on explaining, because I think 

 this can be made to work. 



Mr. Hope. Let us just take the potatoes: Of course, the biggest 

 trouble with reference to supporting the price of potatoes was that we 

 had about one-thnd more potatoes raised than could be consumed in 

 normal channels. 



Secretary Brannan. Yes; as you said, an unusual yield. 



Mr. Hope. It was largely due to the unusual yield; the producers 

 as a whole did not exceed the acreage allotment; but they grew a third 

 more potatoes than we needed. If we had just the payment program 

 under those circumstances and the price on the farm had gone down 

 to $1 a bushel and the support price was $1.75 per bushel, then you 

 would have had to make a payment of 75 cents on every bushel, some 

 450,000,000 bushels of potatoes, and it would have cost more, it seems 

 to me, than the amount that you are going to have to pay out now. 



Secretary Brannan. No, Mr. Hope; you have taken the figures 

 from the example, and the figures from the example would indicate 

 that with $250,000,000 it would figure at about the same amount as we 

 have estimated we would pay under this plan. I do not know how 

 accurate the 75 cents is, but in that neighborhood we would have paid 

 out that dift'erence to every potato producer who moved potatoes into 

 the commercial market. There was, of course, an enormous produc- 

 tion of potatoes and there are some 70,000,000 every year, 70,000,000 



91215—49 — pt. 2 7 



