GENERAL FARM PROGRAM 639 



Mr. HoEVEN. This subcommittee expects, as I understand, to hold 

 hearings on that very question and ^\hile you are here I would Kke to 

 have j'^our views on it. 



Air. Kaseberg. The way that is worked out with this shding parity, 

 it would work a very great hardship on us out there. As T mentioned 

 earlier, we do not have the alternate crops to go into. We take an 

 acreage reduction across the farm this way and then take a price cut 

 the other way. It puts us, and our farm income, considerably below 

 the cost of production. 



Mr. White. Will the gentleman yield? 

 Mr. Hoeven. Yes. 



Mr. White. Assuming you got 90 percent of parity in connection 

 with the acreage quota, would that be satisfactory? 

 Mr. Kaseberg. That would be, yes. 



Mr. White. More satisfactory than the plan you proposed today? 

 Mr. Kaseberg. 1 cannot answer that, because we do not know the 

 mechanics of the plan that we have proposed, but as nearly as we can 

 figure out on a dollars-and-cents basis, in which we have to guess at 

 the world market, there is not a great deal of difference in the final 

 outcome in dollars and cents. 



Our plan, we feel, would move more wheat and let us produce more 

 nearly the economic production point. 



Mr. Pace. Let me propound one question to you gentlemen and 

 the gentlemen of the committee. Under such a plan where we will 

 say 500,000,000 bushels of wheat are maintained at 90 percent of 

 parity and the balance of the crop moves at the world market, under 

 this new 10-year moving average parity which is, as you know, 

 calculated on a comparable market price of the deficit com.modities, 

 what woidd that do to the parity of wheat? Would it not slash it all 

 to pieces? 



Mr. Hope. It depends on whether you use your domestic price or 

 export price. If you used your domestic price, you would not do it. 

 Mr. Pace. Then what price would you use? 

 Mr. Hope. That is the question. 

 Mr. Pace. You can see what I am talking about. 

 Mr. Hope. If you used the world price it certainly would. 

 Mr. Pace. If they used the export price for wheat for 3 or 4 years, 

 the parity price for wheat would go through the bottom of the floor. 

 Mr. Hope. There is no question about that. 



Mr. Pace. If you used the support price at 100 percent of parity, 

 then you would be placing wheat at a level that no other commodity 

 would enjoy. Do you see the complication of it? 



Mr. Hope. Yes. That is a matter, of course, that you would have 

 to give some attention to. 



Mr. Kaseberg. We would not enjoy being up there out of balance, 

 because we could not move it. 



Mr. Pace. If it was done on a certificate plan, then there would be 

 only one price. That would be the world market price. You would 

 have only that price to take into account. 



Mr. Kaseburg. You still get a fluctuation, do \"ou not, as long as 

 you base it on parity? 



Mr. Pace. No, this 10-year moving average, which I was very much 

 disappointed to hear you say you were ready to go along with, because 

 I do not agree with you, is only one thing that controls the related 

 parity prices of commodities. That is the related market price. 



