24 GRAZING FEES GUARANTY PRICE ON WHEAT. 



Mr. McLaughlin of Michigan. The Congress did, and that is 

 why, it fixed the guaranteeci price at $2; because Mr. Hoover was 

 telling us about the joint buying agency, that the allied countries, 

 and the United States would have only one purchaser of wheat, and 

 that he, Mr. Hoover, could make wheat $1.50 if he wished, and even 

 less 



Mr. Clement (interposing). On an open market, did he assume 

 to say? 



Mr. McLaughlin of Michigan. He said he could do it if he were 

 given control, and we felt that he was going to be given control. 

 Hence the bill was passed by which it was so arranged that the 

 price should not be below $2 per bushel. Those statements emanat- 

 ing from Mr. Hoover, or attributed to him, never reached you? 



Mr. Clement. No, sir. This price that you guaranteed, however,. 

 Mr. Chairman, was for 1918. 



Mr. McLaughlin of Michigan. I was speaking of the reasons that 

 lead up to the fixing of the guaranty price, or the putting into the 

 law that the guaranteed price should be $2. 



Mr. Clement. Our understanding of the guaranty price of $2 

 was that it was to encourage the farmers to put in a large crop of 

 wheat for 1918 and 1919. 



Mr. McLaughlin of Michigan. You were speaking about being 

 misled by statements of Mr. Hoover, and I asked you if you had 

 quoted all the statements that you had heard from him, some of 

 which were not of a reassuring nature; and I was telling you of 

 statements that reached the Congress and influenced the Congress 

 to pass that $2 guaranty provision — because they were afraid, after 

 hearing what Mr. Hoover had said, that he would reduce the price 

 away down below what the farmers ought to be asked to sell their 

 ^vheat for. 



Mr. Clement. I am frank to say that we did not get that in- 

 formation. And if we had had any information that would indi- 

 cate that Mr. Hoover thought that he had the power to depress 

 the price of wheat to $1.50 a bushel we would have known very well 

 that he was powerless to do that, with all the authority you wanted 

 to invest him with, if you did not give him the power to fix the 

 price. He could not have done it in a free and open market. The 

 l>eople of this country knew we had less than 600,000,000 bushels 

 of wheat, and they knew the demands of the world. 



Mr. Young. Here is another suggestion that might be pertinent. 

 This was the crop of 1917 on which you gentlemen sustained this 

 loss. The food control law was passed after that particular wheat 

 crop had been made ? 



Mr. Clement. Oh, yes ; long after. 



Mr. Dorset. After it had been harvested. 



Mr. Clement. It was being harvested. 



Mr. Young. As a mattter of fact, Congress in that food control 

 law, where it authorizes the fixing of this minimum price, provided 

 that if this power to fix the price should be exercised it must be 

 exercised seasonably and in advance of seeding time. That is the 

 language of the bill, as I recall it. That would make the power, if 

 exercised, apply to the 1918 and 1919 crops, and it could not relate 

 back to the 1917 crop in which you gentlemen were dealing ? 



