As an additional background factor, it should be noted that it has been established 
Government policy for many years to encourage a high level of agricultural production 
through price supports and research, even at the expense to the taxpayer of the cost of 
storing and disposing of huge surpluses. Production has been controlled through acreage 
allotments, soil bank incentives, and similar measures rather than limitations on yield per 
acre or quality. 
Granted that this program has created problems of a highly controversial nature, 
both politically and economically, it has, nevertheless, been a reasonably consistent 
policy. We have every reason to assume that the Congress of the United States will 
continue to maintain some type of support program, especially as our population growth 
narrows the gap between food production and consumption. 
Minimum prices at around support levels under conditions of surplus production 
provide a tremendous stimulus to the farmer to reduce unit costs. Unit costs are reduced 
through greater yields per acre, reductionin labor utilization, and larger sized production 
units. Obviously the result must be rapid mechanization and chemicalization in agriculture 
as well as a move toward larger and larger farming units under the pressure of mass 
production methods. In 1954, only 10 percent of our farmers produced almost half of our 
off-farm sales of food and fiber. There is little question but what this picture will be 
further changed in the 1960 census. 
The use of pesticide chemicals, therefore, isnot only a necessity from the standpoint 
of pest epidemics and direct crop losses, but also an economic necessity from the stand- 
point of maintaining quality, lowering unit production cost, and in offsetting a decreasing 
farm labor supply. We have always before us the possibility that some growers, who are 
on the verge of going out of business, owing to lack of labor for hoeing weeds or some 
other factor, may misuse pesticidal chemicals as a last desperate gamble because they 
have everything to gain and nothing to lose. A drowning man is often not too concerned 
whether or not he pulls someone else down with him even though on dry land he may be 
the most responsible and public-spirited man in his community. I do not feel that these 
economic pressures in our farming industry and their causes have been sufficiently 
taken into consideration in the many deliberations on the problems involved in chemical 
residues. 
The responsibilities of the chemical industry in this whole field of pesticide residues 
are difficult of definition. The chemical industryis reevaluating its position as well as its 
responsibilities. Some large chemical corporations have either cut back or abandoned 
research in this field and others are considering following suit. It becomes difficult to 
count beyond 12 large chemical concerns worldwide who are carrying on basic pesticide 
research worthy of the name. Basic research by the smaller chemical companies is 
virtually nonexistent. 
Many promising chemicals have been dropped from development programs because 
potential markets have not been large enough to justify development expense. It has been 
suggested in some quarters that industry is shirkingits responsibilities by not developing 
promising products even though they will lose money. This assumes that every company 
has some inexhaustible pot-of-gold that allows it toforget about making a profit. Industry 
has a responsibility to its stockholders as well as to the public and to its customers. 
As long as we havea free-enterprise system, this will remain so, whether it be chemicals, 
farm products, or airplanes. We can establish, therefore, one basic responsibility of 
industry, namely, to make a profit as justification for the stockholder’s investment in the 
enterprise. The weekly index of business failures published by the Department of 
Commerce is testimony to the fact that all businesses are not necessarily successful. 
Let us look more specifically at the pesticide field. Agricultural pesticide sales at 
the farmer level represent only about 2 percent of total chemical industry sales--about 
$500 million out of a $25 billion industry. It should be apparent that financial manage - 
ment is reluctant to take large risks in a field that represents only 2 percent of the 
industry. These risks include: (1) High investment indevelopment and plant, (2) problems 
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