GENERAL FARM PROGRAM 839 



ment here a profit analysis of the Ohver Corp., Alhs-Chalmers, and 

 International Harvester Co., which was prepared by our research 

 department recently from reports of the companies themselves. 



Mr. Pace. Would j^ou like those reports to be inserted in the record? 



Mr. Ayres. Yes, Mr. Chairman. 



Mr. Pace. They may be inserted in the record at the conclusion 

 of your statement. 



Mr. 2VYRES. There was an increase of 2 percent in the number of 

 people hired to work in farm-equipment plants at the end of 1948, 

 but production increased 20 percent. This increase in production 

 per worker was not handed to the farmers in the form of lower prices 

 or the workers employed in the plants in the form of wage increases, 

 but pocketed by the farm-equipment monopolies. 



Between 1941 and the end of 1948 farm machine prices were jacked 

 up again and again. By early 1949 farmers were forced to pay 60 

 percent more for implements and 72 percent more for trucks than in 

 1941. 



Despite IHC's frequent attempts to pin the blame for its price 

 policy on its workers, the Government itself, sometime ago, exploded 

 the myth that high wages were responsible for high prices. In its 

 eighteenth quarterly report, the Office of Price Administration showed 

 how industry raises prices far above levels necessary to ofi'set any 

 wage increases. Adjusting the figure to International Harvester, the 

 9.4 percent increase in hourly earnings between 1947 and 1948 could 

 have been offset by a 2-percent price increase. Instead, Interna- 

 tional Harvester boosted farm machine prices 20 percent and truck 

 prices 18 percent above the already towering 1947 levels. 



According to the company's own report, the cost of wage and 

 salary increases in 1948 was "about $10,000,000." Yet price increases 

 during 1948 amounted, on all Harvester products, to a grand total of 

 88.5 million dollars. That was more than eight times the amount 

 necessary to cover the cost of wage and salary increases during the 

 year. 



Not high wages, but pure and simple profiteering, robbed millions 

 of dollars from farmers' pockets at a time when their desperate need 

 for farm machines made them helpless in the face of IHC's greed for 

 profits. 



In conclusion, let me state that we think there is great danger of 

 another depression. With farm prices falling and unemployment 

 rising, all signs point to another economic crisis. Although price- 

 support floors high enough to maintain a high-level farm income will 

 not prevent a depression they wiU go a long w^ay in helping prevent 

 one. I am in agreement with Mr. Brannan that depressions have 

 been farm-led and farm-fed. Holding up farm income is the main 

 farm problem as we see it. 



But we go further than just supporting legislation guaranteeing 

 a high farm income and high price supports for the famil}' farmers. 

 We support the development ot riv^er-vaUey projects, patterned after 

 the highly successful TVA. Such projects will lay the foundation 

 for electrification, rural telephones, better roads, better educational 

 and health facilities in the country, and for a better social and cultural 

 life for all farm families. We support legislation which will give 

 farmers cheap Government credit, crop insurance, and soil-conserva- 

 tion programs, now more necessary than ever before. We believe 



