460 GENERAL FARM PROGRAM 



I am interested in a release which came to members of this com- 

 mittee from the Secretary of Agi'iculture's office recently setting out 

 questions and answers on the proposed Brannan program. In the 

 heading it says, "The following questions and answers have been 

 prepared in response to the numerous requests for additional 

 information." 



I have searched that questionnaire very carefully from question 

 No. 1 through question No. 46. Strange to say, there is not a single 

 reference to the cost of the program. 



When Mr. Brannan appeared before this committee, among the first 

 questions asked him was, "What will the program cost?" Mr. Bran- 

 nan could not answer that interrogatory at that time and apparently 

 he has entirely overlooked, among the many questions asked about 

 this program, the cost of the program. 



Mr. Kline, I think you gave us some very enlightening information 

 the other day when you referred to only one specific item, to wit, milk. 

 You said the cost in regard to that program would be approximately 

 $2,480,000,000. In your judgment, is the cost of this program, as 

 proposed by the Secretary of Agriculture, going to be such as to not 

 only be staggering, but that it is also going to completely bankrupt 

 the Federal Treasury ? 



Mr. Kline. Mr. Hoeven, it is difficult, of course, as we suggested 

 in our testimony previously, to make a well-considered estimate, since 

 we do not have more than the Secretary's recommendations which are 

 in general terms. With regard to what it might do to the Federal 

 Treasury, s(i many circumstances are involved that it is difficult to 

 say. Therefore, it is necessary to set up some assumptions. 



We have set up some assumptions which seemed to us to be reason- 

 able. We used milk. We reasoned that you could get the increased 

 milk produced for an additional 80 cents a hundred. It is a very 

 modest increase in the price to get an increase of 25 percent in pro- 

 duction. This we estimated would cost $1,224,000,000. 



Then we noted that a 25 percent increase in milk available for sale 

 Avould naturally drive the price down and assumed that it might 

 go down to 15 cents, which had been suggested as a price, and noted 

 that that would cost an additional $1,200,000,000. 



It does seem an unreasonable amount and I would therefore call 

 attention to the predicament in which producers of milk would find 

 themselves, having increased their ownership of cattle and barns and 

 milking machines and distribution equipment by 25 percent, having 

 done it on the basis of a price which was eiiough to bring forth that 

 sort of production in competition with other sorts of production, 

 having the public accustomed to a price that much lower than the 

 actual cost of production, and having their income dependent upon an 

 annual appropriation from Congress. 



Eventually, the Congress says this movement toward a bankrupt 

 government has gone far enough and we should cut out the appro- 

 priation or drastically reduce it. Then the public is used to cheap 

 milk, and it is at the price at which it will move into consumption 

 and the farmer takes the rap. We think it is a very unsound basis 

 from the farmer's standpoint for a national program. 



Mr. HoEVEx. Is that not the disturbing feature, Mr. Kline, that 

 the progi'am is entirely dependent upon the whim and the will of 

 the Congi-ess in making the appropriations? 



