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same as the value per acre of small crops. Over the sixty-six- 

 year period from 1873 to 1938, small crops of wheat brought 

 $12.47; and large crops, $12.38. The difference, $0.09, was 

 less than one per cent of the average value of the crop. In the 

 nineties, when the price level was very low, wheat was worth 

 about $9 an acre ; during World War I, when the price level 

 was very high, $23 an acre; and in the twenties, almost $15 

 an acre (figure 3). The difference due to the price level was 

 much greater than the difference due to large or small crops. 

 The same holds true for other crops. 



Variations in the supply and the price of wheat and other 

 food crops for any given year tend to be compensating. Con- 

 sequently, the farmers' income varies less than one would 

 expect by looking at either price or the size of the crop alone. 

 The effect of the price level on the value of the farmers' crop, 

 and consequently their income, is not compensated. There- 

 fore most of the variation in the farmers' income is due to 

 the forces that make all prices, and not to changes in the size 

 of the crop. 



Man is unable to observe and measure the effect of the 

 general price level. He is able to observe the effects of large 

 and small crops. Therefore it is universally but erroneously 

 agreed that the supply of a commodity is the overwhelming 

 factor affecting incomes of food-producers. 



Food Prices Made by Economic, Not Political Laws 



Violent changes in farm and retail prices of food have 

 led to demands that something be done to prevent such 

 changes. We have been attempting in a large way to fix farm 

 prices by legislation for about ten years. We have resorted 

 to legislation in order to control retail prices of food only 

 recently. 



The American people have great faith in legislation as the 

 solution to any problem. Legislation regarding farm prices 



