January, 1933 





T H E I. A. A. RECORD 



Page Five 



C^Cp ^— 



Congress Works Over Farm Bill 



All Major Farm Organizations Unite Behind Measure To Control Surplus And Raise 



Prices On Staple Farm Commodities 



AGRICULTURE'S own solution 

 for the Farm Problem was pre- 

 sented to the House Committee on 

 Agriculture December 14, President 

 Earl C. Smith reported following 

 his return from Washington where 

 he attended several meetings and 

 conferences of farm organizations 

 and co-operatives called by the 

 American Farm Bureau Federation. 



The plan was outlined before the 

 committee by Fred Lee, legislative 

 counsel for the A. F. B. F. who also 

 represented farm co-operatives and 

 other general farm organizations. 



The plan is the result of many 

 months of intensive study and was 

 unanimously approved by repre- 

 sentatives of the major farm groups 

 the day before. The plan is based, 

 on the following definite principles: 



Here Are Principles 



1. The pre-war purchasing power 

 of farm commodities in terms of 

 goods the farmer buys must be re- 

 stored insofar as the domestic 

 market is concerned in order to per- 

 mit a fair exchange of goods be- 

 tween farm and factory and so 

 make possible a general renewal of 

 business activity. 



2. Production of farm products 

 must be reduced in line with effec- 

 tive demand. 



3. Plans to attain these objectives 

 must be applied to basic products 

 which have a price determining ef- 

 fect on other products, and on 

 which the tariff is not effective be- 

 cause of exportable surpluses. 



4. Plans adopted must be self- 

 financing and must not require the 

 creation of any large new govern- 

 mental agencies. 



The farmers' plan as outlined by 

 Mr. Lee would apply to wheat, cot- 

 ton, tobacco, hogs and possibly to 

 dairy products, and is to be admin- 

 istered by the Secretary of Agricul- 

 ture. 



In the case of wheat, cotton and 

 tobacco, it provides for the pasmient 

 to producers of these commodities 

 of special adjustment payments, on 

 that portion of their production re- 

 quired for domestic consumption, 

 sufRcient to raise the total price to 

 the pre-war purchasing parity. The 

 adjustment payments will be made 

 in two equal installments, the first 

 thirty days after marketing, and 

 the second six months later. 



Favor Those Who Cut 



Adjustment payments will be 

 made only to those producers who 

 shall submit satisfactory proof to 

 the designated local agent of the 

 Secretary of Agriculture that they 



have reduced their 1933 acreage by 

 20 per cent, and have not planted 

 that acreage to other cash crops. 

 Payments will be made by the 

 treasury of the United States, the 

 money to be recovered by an excise 

 tax on the commodity at point of 

 first processing. 



The processing t£|,x is to be the 

 amount required, as estimated by 

 the Secretary of Agriculture, to be 

 paid in adjustment payments in 

 order to restore the total price of 

 that portion of the commodity used 

 in domestic consumption to its pre- 

 war purchasing parity. Revision 

 of the excise tax and payments to 

 producers in accordance with the 

 principle is to be made by six-month 

 periods. The excise tax will become 

 effective at the beginning of the 

 1933 crop marketing season and will 

 apply to flour stocks in the hands of 

 processors at that time. 



If, in the judgment of the Secre- 

 tary of Agriculture, it is necessary, 

 after the first year, to make indi- 

 vidual allotments to producers and 

 enter into individual contracts with 

 them in order sufflciently to control 

 production, he is empowered to do 

 so, and to designate the percentage 

 of acreage reduction required. Ad- 

 ministrative expenses are limited to 

 not more than 2'^ per cent of the 

 excise tax fund collected. 



In the case of cotton, the parity 

 period is to be 1921-29 instead of 

 1909-14, on account of the change 

 in production costs caused by the 

 boll-weevil. 



Applied To Hogs 



The plan is to be applied to hogs 

 in the following manner: 



Thirty days after passage of the 

 act, the excise tax on pork products 

 is to go into effect on a graduated 

 basis, on the basis of 50 cents per 

 100 pounds of hog, live weight, for 

 the first sixty days, $1.00 for the 

 second sixty days, $1.50 for the third 

 sixty days, and $2.00 thereafter, 

 that rate to be advanced to the 

 point necessary to restore pre-war 

 purchasing power as rapidly as im- 

 proved business and increased con- 

 sumer income permits. 



The production control program 

 will go into effect thirty days after 

 passage of the act, producers to be 

 paid an adjustment payment frcm 

 then until October 1 of $1.00 per 

 cwt. on all hogs weighing 210 

 pounds or less, and in consideration 

 of an agreement that each pro- 

 ducer's total tonnage marketed 

 during the year shall be 20 per 

 cent less than during 1932. 



. 90(:496Wr, 



Adjustment of hog production to 

 effective demand is to be facilitated 

 by the following temporary meas- 

 ures. 



1. The Secretary of Agriculture is 

 empowered, when and as necessary 

 to prevent surplus pork and lard 

 stocks from defeating the purpose 

 of the plan, to purchase such stocks 

 in the required amount and dispose 

 of them in non-competitive chan- 

 nels, such as unemployment. 



2. The close relationship between 

 corn and hogs necessitates a reduc- 

 tion in corn production for 1933. 

 This is to be accomplished by pay- 

 ment to corn growers who reduce 

 their corn acreage by 15 per cent, 

 of $4.00 per acre on the acres thus 

 taken out of production. 



Pre-War Parity Sought 



This plan, in the opinion of farm 

 leaders, will result in such adjust- 

 ment of production to demand as is 

 necessary to restore the pre-war 

 parity between farm and industrial 

 prices, and thus open the way to the 

 resumption of business activity on 

 a normal scale. Farm leaders are 

 positive in their statements that 

 there can be no approach to normal 

 business conditions and employment 

 until farm buying power is restored 

 to normal. They point out that farm 

 prices are now 31.6 per cent below 

 pre-war, while goods purchased by 

 farmers are 6 per cent above pre- 

 war. Whenever restored employ- 

 ment and improved world trade 

 raises the open market price of 

 farm products to their pre-war par- 

 ity, the plan will automatically be- 

 come inoperative. 



The plan is endorsed by the fol- 

 lowing farm organizations: 

 AMERICAN FARM BUREAU FED- 

 ERATION 



Edward A. O'Neal, President 



Charles E. Hearst, Vice-President 



Earl C. Smith, Director and Chair- 

 man of Legislative Committee 



George M. Putnam, Director and 

 Member of Legislative Committee 



M. S. Winder, Secretary-Treasur- 

 er. 



Chester H. Gray, Legislative Rep- 

 resentative 

 NATIONAL GRANGE PATRONS OF 



HUSBANDRY 



L. J. Taber, National Master 



F. A. Freestone, Executive Com- 

 mittee. 



Fred Brenckman, Legislative Rep- 

 resentative. 

 FARMERS' EDUCATIONAL AND 



CO-OPERATIVE UNION OF 



AMERICA 



John Simpson, President ■ ^ " 

 (Continued on page 7) Vi -:^ 



