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were made to bring farm prices up to parity. With three 

 years of general inflation, parity has been reached and 

 passed ; the nation is now attempting to hold prices down. 



Whether farm products sell above or below their parity 

 ratios at a given time is essentially a question of general 

 inflation or deflation. 9 



During the seven years 1933-9, when billions were spent 

 in an effort to restore parity, the average of all farm products 

 brought 77 per cent of parity. Since 1939, with a rising price 

 level, it has increased to 114 per cent. 



Wheat is a product which has been subject to rigorous 

 controls. The government purchased, through loans, huge 

 amounts of wheat, and large payments were made to pro- 

 ducers to curtail production. During this seven-year period 

 the average purchasing power of wheat was 6 points below 

 the average of all farm products. At the beginning of the 

 period it was 3 points below; and at the end, 16 points below. 

 Cash payments increased the income of wheat-producers, 

 but the other phases of the program did not improve their 

 prices relative to the average of prices of other farm products. 

 In fact, those products which were not under control rose 

 relative to wheat. 



The acreage of corn was also curtailed, and the govern- 

 ment purchased, sealed, and stored large amounts of corn 

 and paid producers substantial amounts to curtail produc- 

 tion. At the end of the period the purchasing power of corn, 

 like wheat, was less than at the beginning. 



Butter, which was not subject to controls, averaged a little 

 better than all farm products. 



9 Most of the change in farmer's prices expressed in terms of parity were 

 due to world-wide inflation and deflation, and the rates of change were 

 uniform. With the deflation of the twenties and thirties, a 1-per-cent fall in 

 prices caused 0.61- and 0.67-per-cent declines in parity. With the inflation 

 of World War I, the twenties, and the thirties, a 1-per-cent rise in prices was 

 accompanied by 0.77-. 0.85-, and 0.83-per-cent advances in parity. With 

 World War II inflation, the rate was 0.68 per cent. 



