362 GENERAL FARM PROGRAM 



what he says when he gets his check. But at home that night, after deducting 

 costs fvowi his gross income and eyeing the red in the net figure, he will say 

 very little except: "There won't be much to spend for Christmas this year, 

 mother." 



Two other things might happen to Doe in 1950. They are worse. Farmers 

 could vote down quotas. Then the support price would drop to 50 percent of 

 new parti.v-transitional parity * * * if tj^ got a loan on 4,000 bushels, 

 Doe's gross, before CCC loan interest and service charges, would be $3,084. 



Or it might be that he would get 60 percent of new parity plus transitional 

 parity, in case acreage allocations and marketing quotas were out and the price 

 rested on the support level due to a large supply in relationship to nomial 

 supply * * * Before loan interest and service charges, with 4,000 bushels 

 to turn over to CCC, Doe would gross $3,674. 



In short, his altei-natives as gross income in 19.10 would be $3,674 or $3,084 or 

 $3,760 — any of which is around 50 percent of what he grossed in 1948. 



IVIr. Hendi'ickson's paper is of such interest that I shoiikl like to 

 offer the whole of it for the record of this hearing, in order that 

 members of the committee, if they desire, may look more closely at 

 the assumptions he makes and his reasoning in arriving at his figures. 

 Mr. Hendrickson was citing wheat ])ut in general his analysis will 

 apply to most othei* commodities, and indeed the sliding-scale supports 

 do nothing about perishables at all. I might say that he was citing 

 wheat, Mr. Chairman, but I think it applies in a general way to the 

 rest. I would like to have your permission to put it in the record. 



Mr. Pace. I have had the pleasure of reacting Mr. Hendrickson's 

 statement and, without objection, it will be inserted in the record fol- 

 lowing the completion of your statement. 



Mr. Patton. So drastic a decline in storables obviously would have 

 a strong, de])ressive effect on all commodities. 



What is tlie other alternative now before Congress? It is simple 

 extension of the legislation in effect this year. Naturally, we believe 

 this woidd be far better than permitting the flexible-stipport legisla- 

 tion to become effective this winter. If present support levels were 

 accompanied by severe restrictions on planting and marketing, their 

 continuation at least would assure to agriculture a reasonably good 

 income. 



But the hazards of such action are great, indeed. Two major objec- 

 tions, among others, may be stated briefly to this proposal. One is that 

 the controls that it would necessitate woidd be far more stringent 

 than imder either of the other alternatives. The other is that the 

 cost to the Treasury is likely to be enormous. Avithout corresponding 

 b( nefit to the consumer. These points need not be argued exhaustively. 

 If the cotton and wheat carry-overs alone be taken, in conjunction with 

 the prospective 1949 crops, the prospect becomes clear — and it is a very 

 difficult prospect, indeed. It now appears that the total cotton carry- 

 over at the end of this year's harvest will amount to 6.000,000 bales, 

 while the wheat carry-over may be as much as 400,000,000 bushels. 



Without bold and sweeping action to meet this condition in a way 

 that will not only stabilize farm income but will give consumers the 

 benefit of such abundant production — without such action the prob- 

 lems arising tmder a simple extension of this year's program are going 

 to become insurmountable. Yet failure to surmount them could well 

 mean the com))lete c()lla])se of the price-supi)ort .system. 



For all of these reasons the National Farmers Union urges upon 

 Congress the very gi-eat advantages, as compared with the otlier kinds 

 of action open to Congress, of a program of the kind outlined by 

 the Secretary of Agriculture. 



