292 GENERAL FARM PROGRAM 



That is the minimum under your program and the flexibihty would 

 be obtained by offering a higher price support level than that mini- 

 mum to expand the production of certain commodities. 



In other words, the income support level in your program would 

 correspond to the 60 percent in the Aiken bill, as far as basics are 

 concerned, and to the zero in the Aiken bill as far as nonbasics are 

 concerned. 



Secretary Brannan. I think it would, sir. 



Mr. Pace. Will the gentleman yield? 



Mr. Hope. Mr. Granger has the floor. 



Mr. Granger. I will yield. 



Mr. Pace. Is not the fundamental difference in the philosophy of 

 your plan and the philosophy of the Aiken bill that instead of driving 

 a producer out of the production of a commodity by a reduction in 

 support, you lead him out of the production of that com.modity into 

 the increased production of the commodity that is needed by raising 

 the support on that commodity? 



Secretary Brannan. That is right. 



Mr. Pace. The Aiken bill tries to drive them out through a cheap 

 price and you lead them out through a better price for the com- 

 modities that people need. Is that not correct? 



Secretary Brannan. That is correct and I think that is what Mr. 

 Hope is saying too, isn't it? 



Mr. Pace. I do not think so. 



Mr. Hope. Is there any greater danger under your program of a 

 total over-all overproduction of agricultural commodities than you 

 have under the program provided in the Aiken bill? Under yom- 

 interpretation of it you have as much flexibihty. I understood you 

 to say you thought you would have more flexiiblity in your program 

 than the Aiken bill. 



Secretary Brannan. The flexibility runs up more than down, I 

 think, Mr. Hope. 



Mr. Hope. \Vliat effect would that have on this question of over- 

 production? In other words, if we shift into one thing because we 

 have a sm'plus of something else, then we are very likely to be pro- 

 ducing a surplus of that new commodity. Do you think we would 

 be more likely to do that under your system which would provide 

 for a considerably higher price support level than the Aiken bill? 



Secretary Brannan. I think perhaps if you had no production 

 limitations of any type whatsoever and you induced people out of 

 one commodity by a price inducement that eventually would have a 

 general tendency to increase prices. But that is the very reason 

 that we have suggested the need for the acreage limits and the mar- 

 keting quotas which are now on the statute books and we have also 

 pointed out that by the use of production payments in perishables 

 you could get that kind of a limitation much easier and much more 

 simply. I think I should add to that sentence -^s stated a moment 

 ago tiie word "relative." As a matter of fact, the level of prices is 

 always controlled by the index of prices received by farmers related 

 to the purchasing power of the dollar during the 10-year period and 

 the total earnings of the same 10-year period. It does keep in 

 sympathy with over-all national income but at the same time we 

 try to work om' adjustments by inducement rather than by a lower- 

 ing of prices in each case. If the philosophy is correct, it is correct 



