5 AGRICULTURAL DISCONTENT 



and more than 5,000 national farm-loan associations. These had been 

 organized under the Federal Farm Loan Act of 1916 and were incor- 

 porated into the F.C.A. in 1933. Short-term credit was secured by chattel 

 mortgages or crop liens through nearly 600 production-credit associations 

 established in 1933. These local associations were organized and super- 

 vised by the twelve production-credit corporations. Finally, credit was 

 provided the farmers' cooperative associations through the establishment 

 of a central bank and twelve district banks for cooperatives. The banks 

 for cooperatives extended long-term credit, and the Federal Intermediate 

 Credit Banks extended short-term credit. 61 



During the summer of 1935 an unprecedented campaign was launched 

 against the processing tax, especially after the N.R.A. was declared uncon- 

 stitutional by the United States Supreme Court. Many lawyers had been 

 arguing that the A.A.A. was equally unconstitutional. The lead in this 

 opposition was taken by the food industries. Numerous injunction suits 

 were being brought to court with the intention of tying up the tax 

 revenues with which the government paid farm benefits. General Mills, 

 Incorporated, of Minneapolis, reported to be the largest milling organiza- 

 tion in the world, announced that it would challenge the right of the 

 government to collect this processing tax. The company had more than 

 a passing interest in this. In July, 1935, it was reported that its operating 

 units had a daily production capacity of about 81,000 barrels, on which 

 a tax of from $1.35 to $1.40 was assessed for each 196-pound barrel of 

 flour. It was estimated that the tax paid the government by General Mills 

 daily amounted to about $110,000. Early in July, 1935, fifteen huge milling 

 concerns and five meat packers attacked the constitutionality of the 

 processing tax. These recalcitrant firms refused to pay the taxes that were 

 due on July i and asked the federal courts for permanent injunctions 

 against their collection. 62 



It appeared that each succeeding year had brought new storms across 

 the path of the A.A.A. In 1933 opposition developed because of the order 

 to slaughter 6,000,000 pigs and to plow up every third row of cotton. In 

 1934 came the drought, which diminished production beyond all thoughts 

 and desires of the A.A.A. and brought upon its head the wrath of many 



61. Ibid., pp. 6-1 o. 



62. Milwaukee Journal, June 29, July 3, 9, 1935. 



