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small part of the consumer's dollar, a given change in the 

 retail price results in a large percentage change in the farm 

 price. As the whip gets longer, the farmer feels the crack of 

 the whip more than he once did. 



City folks who fear a ten-per-cent rise in the retail cost of 

 food because there has been a ten-per-cent rise in farm prices 

 make two errors. First, they have mistaken cause for effect, 

 and second, a ten-per-cent rise in farm prices was accom- 

 panied by only a three- or four-per-cent rise in retail prices 



of food. 



Overproduction Was a Myth 



During the thirties farm prices of food were low and it was 

 generally believed that they were low because of the loss of 

 our foreign market and an overproduction of food. The over- 

 production argument ran as follows : through improved ma- 

 chinery, better breeds of livestock, and better farming prac- 

 tices, the techniques of food production had outrun our need 

 for food and we had entered a new era of abundance. 



In a sense this was a double error. Farm prices were low, 

 not because of overproduction, but because of a low general 

 level of prices. In fact, the production of food per capita was 

 lower during the thirties than during the twenties. There is 

 no evidence to indicate that at any tune during the past 

 quarter of a century there has been an overproduction of 

 food. 



The bureaucrats did a marvelous job of selling the over- 

 production idea to the country. It is a credit to their journal- 

 ism, though not to their economics. Since time immemorial, 

 farmers have observed that a big corn crop brought low 

 prices, and that a small crop brought high prices. This simple 

 principle has been observed throughout history and has been 

 demonstrated to the satisfaction of all. 



Since this principle held for an individual crop like corn, 

 the regimenters had little difficulty in convincing the nation 



