GENERAL FARM PROGRAM 957 



Mr. PoAGE. I am not asking you to change that; I am talking 

 about how you would get the money, whether Congress would make 

 a definite appropriation year after year — and I do not think Congress 

 would continue to do it — whether you would rather rely upon Con- 

 gress making a direct appropriation year after year to the end that 

 you had this amount of money to bring you up to a fair standard, or 

 whether you would like to have the farmer himself make a contribu- 

 tion to the fund from which you would pay these losses? 



(Xo answer.) 



Mr. Pace. Ai'e there any further questions? 



Mr. Andresen. I am sorry this hearing has to be rushed, because 

 I think this potato problem is one of the most important ones we have. 



Mr. Pace. I am not trying to do anything but to serve these 

 gentlemen. You understand the difficulty of gettmg the members 

 back here during the afternoon, and I am just trying to do the best 

 job I can while everybody is here; that is all. 



Mr. Andresen. I am not criticising the gentleman at all for that; 

 I just think we ought to have adequate time to develop the entire 

 program, because the potato has been held up as the horrible example 

 of what happened to price-support programs, and i did want to make 

 a few observations at this time, one is that the easiest thing for the 

 grower to do is to sell his potatoes to the Government, that is one of 

 the quickest ways to bring down price support. 



As a larger grower said, the Government "has offered me down in 

 Florida $3.40 for 100 pounds of potatoes under the 1949 program," 

 and, of course, he will sell his potatoes to the Government at $3.40, 

 because the trade has probably only offered him $3.25, which is 

 under the support price, and the best evidence we have had of that 

 is the 6 or 7 million bushels of Canadian potatoes that have come 

 in and been dumped on the eastern market at a time when the growers 

 are getting more from the Government, and it looks to me as though 

 that is destroying the merchandising system because of the failure of 

 the trade to cooperate in that kind of program. 



We have had the same situation with butter today. The Govern- 

 ment has a support price for butter and the trade is offering about 

 1 cent to 3 cents under the support price and the Government is 

 getting the butter. 



Mr. White. Will the gentleman yield? 



Mr. Andresen. I would like to get the observation of Mr. Case to 

 that suggestion. 



Mr. Case. >Ir. Andresen, if I agreed with yoa it would be to deny 

 the law of supply and demand. Obviously the trade has to pay more 

 than the support price to get the supply they need — the theory of 

 price support is that the Government does stand ready to remove the 

 surplus at a price, which may be available to the trade at the time. 



Mr. Andresen. But you would agree that the trade will generally 

 offer less than the support price? 



Mr. Case. I think the trade will try to buy as cheap as it can. 



Mr. Andresen. Certainly. 



Mr. Case. If price support functions as designed to function they 

 will have to bid in the good with the bad. 



Mr. Andresen. So they will go to the No. 2 potatoes at the im- 

 proved price, and the Government is getting the higher priced 

 potatoes, the No. 1. 



