360 AGRICULTURAL ECONOMICS 



describe accurately what happens to a product from the time 

 it leaves the farm until it reaches the consumer. In the light 

 of these facts intelligent and safe steps may be taken to improve 

 conditions, whereas legislation striking in the dark stands great 

 chances of doing harm and little chance of doing good. 



When the fog is cleared away the true character of the issue 

 may come into view. It will be recognized that, in general, 

 middlemen render a service. The real issue between the farmer 

 and the middleman relates to the fairness of the charge made for 

 the service. That more economical methods may be introduced 

 at certain stages in the middleman process will be accepted 

 without debate. A survey of the work of the middlemen which 

 would show how to replan the route from producer to consumer, 

 in such a manner as to shorten the line and reduce the number 

 of stops and the amount of rehandling, should be acceptable 

 to every one concerned. The wisest middlemen would be the 

 first to accept the new economies. There is clearly no issue 

 here between the middleman and the endmen. The real issue 

 then is the fairness of the charge for the middleman service. 



This is an important issue from the farmer's point of view. 

 When considering the prices of the supply of farm products on 

 hand at the end of a given harvest the farmer may be looked 

 upon as the residual claimant. He gets what is left after all 

 charges are paid. Every expansion of middleman charges, with- 

 out added service for which the consumer pays, cuts the farmer's 

 income ; every reduction in cost increases the farmer's profits. 



When the consumer pays the retailer a dollar for potatoes, 

 the dollar goes into the retailer's cash register. The retailer 

 may have to take eighty-three cents out of the till and pay it to 

 the wholesale dealer. Other parts have to be taken out to pay 

 store rent, clerks, taxes, delivery, etc., but we shall omit the 

 details and follow the main course of the remnant of the dollar 

 which works back from one middleman to another until the 

 farmer is greeted with his residual share. The wholesaler 

 takes out seven cents and passes seventy-five cents over to the 

 jobber, who pays eight cents to the railway company and keeps 

 five cents for his own service. This leaves sixty- two cents, 



