386 GENERAL FARM PROGRAM 



the 80 and 60 for those groups for qualified persons — we suggest storage 

 loans or purchase agreements on the storable commodities, 



I should like to call the connnittee's attention to the second line to 

 a word that was deleted through error, and that is the w^ord "other" 

 following "all." It is at the end of the second line. We suggest com- 

 pensatory payments on all other commodities, not all commodities. 



So far as we know and so far as we can determine, the support prices 

 can be maintained on storable commodities through the currently used 

 devices of loans or purchase agreements. There may be instances and 

 probably are wdiere direct Government purchases may be of value or 

 the authority to make them may be of value. We have been unable 

 in all of our deliberations to see how we can give comparable treatment 

 to the nonstorables or the crops that move daily or weekly or monthly 

 from the farm into processing or consumer channels on a similar basis 

 to that to deal tv^ith storable commodities. 



I believe the Secretary said production payments. We call them 

 compensatory payments, which we suggest. I should like to make 

 this point clear in connection with the last line in that section. We 

 say compensatory payments shall be the difference between parity 

 prices and regional-average prices com]>uted monthly. May I illus- 

 trate, Mr. Chairman, what we mean and why? 



Thus far, to the extent that such payments have been made or offered 

 on nonstorables — let me use eggs as one illustration — the computation 

 has been made, as we understand it, on a basis of national averages 

 computed annually. The result has been the average price for eggs 

 in the United States for 1948, the calendar year 1948, computed once 

 a year on a national average, was 5;5i/2 cents a dozen. Tliat is almost 

 to a fraction of a penny what the parity-support price of eggs was 

 supposed to be. 



I am not in a position to say how nuich some farmers got for their 

 eggs who might hap]oen to be close to large consuming centers for fresh 

 eggs immediately available to them, but I do know that out in the 

 Dakotas and that general part of the country farmers who produced 

 eggs sold them for 29 and oO and 81 and perhaps as high as 35 cents 

 a dozen. Yet, at the end of the year we were told that the average 

 price of eggs equaled, substantially, the support price for eggs and 

 therefore there would be no support prices paid to them. That is one 

 of the troubles with averages. Whenever you have an average of 

 something, somebody is usually above it and somebody is below it. 



In that instance, a great many people were very substantially below 

 that average. It is my infoiination — and I am not an expert on milk — 

 that a similar situation obtained in relation to whole milk and many 

 of its allied ])roducts, but ])articularly whole milk as the differential 

 between the milkshed producers and those out in the hinterlands where 

 they had heavier freight rates, where fresh-milk markets daily were 

 not available to them, and where national-average prices, computed 

 annually, gave them a very poor break, in our judgment, in terms of 

 support prices. 



We certainly feel and are as insistent as we may be that on any 

 compensatory payments or production ])ayments that are made to 

 fai-mers, being the difference between the average market prices avail- 

 able to farmers and the support price, whatever it is, that those com- 

 putations should be made on a regional basis and not less often than 

 monthly. 



