GENERAL FARM PROGRAM 913 



that we would not like to return to the producer-payment system 

 that was in effect at that time. 



The Chairman. I think that you have misunderstood me. 



Mr. HoLMAN. Perhaps. 

 . The Chairman. I said that in changing or altering the method of 

 determining parity, you want consideration given to two additional 

 things: One is farm labor and the other is the subsidy that was paid 

 during the war period which kept down the price of milk. 



Mr. HoLMAN. That is correct. 



The Chairman. Do I understand correctly if your recommendation 

 is followed you would add to the consumer milk bill of the Nation a 

 minimum of $152,000,000 a year? 



Mr. HoLMAN. That phase of it would, I presume. Before you 

 came in I pointed out to the committee, and it was not in my printed 

 statement here, that we calculate that the losses to dairying this year 

 in market prices as a result of the prices prevailing in the first quarter 

 of 1949 will be something over $612,000,000, as compared with the 

 returns to dairying for the year 1948. The very suggestions we have 

 made in this statement of mine were designed to recover to the extent 

 we could the status quo of prices prevailing in 1948. 



The Chairman. Then that would ass to the milk bill of the country 

 about $152,000,000 a year. 



Mr. HoLMAN. More than that. 



The Chairman. Just on fluid milk and manufactured milk. 



Mr. HoLMAN. That is correct. 



The ChaiRxMan. If you followed the same recommendation, of 

 course it would add to the cost of the butter bill. 



Mr. Holman. Well, it might. 



The Chairman. If fluid milk is advanced as you suggest, it is only 

 natural that butter would have to advance. 



Mr. Holman. But fluid milk has gone down very much, you see. 

 The farmers are beginning to sufl'er in the fluid-milk sheds as well as 

 the great manufacturing regions of the country. 



The Chairman. As fluid milk advances in price butter naturally 

 advances in price. 



Mr. Holman. There is a connection there. 



The Chairman. We do know even on the fluid and the manufac- 

 tured milk, the additional cost to the consumer would be $652,000,000 

 and in addition to that, the butter people of the countrv would be 



Mr. Holman. The total would be approximately $652,000,000. 



The Chairman. $652,000,000 would be the total. Is that calcu- 

 lated to result in an increase in the consumption of milk, or in a 

 decrease — if you add to the milk bill that amount of money? 



Mr. Holman. That is calculated on the basis of the anticipated 

 production of this year. We would not like to see dairy prices get to 

 a point where the production of milk could not increase in a fair 

 ratio to what the consumers could use. 



The Chairman. The Secretary has suggested in effect that when 

 the milk price comes down the consumption increases. You are sug- 

 gesting here that the price go up. 



Mr. Holman. That the price be restored. 



The Chairman. That the price be restored, and that certainly 

 would not tend to increase consumption, would it? 



