PRICES OF FARM PRODUCTS. 23 
The amount by which the agricultural situation is worse than the 
general condition is largely due to excessive production and the 
checking of exports. 
There would doubtless have been industrial depression in any 
event, but the serious breakdown in the farmers' purchasing power, 
due to the extremely low prices of farm products, has had much to 
do with the severity of the industrial depression. 
Many forces are at work to correct the situation. The following 
are but a few of the many things to be done : 
A general adjustment to some fairly stable price level will greatly 
help toward making it possible for each class of workers to use the 
output of other workers, and thus open the channels of production 
and trade. Wages, freight rates, retail prices, fartn prices need to 
become adjusted to the same general price level as quickly as pos- 
sible. Some important things are yet double the prewar price. 
Others are cheaper than before the war. Industry can not progress 
in a normal way with such violent maladjustments. Prices and 
charges that have not been decidedly reduced should come down. 
Those that have dropped excessively should rise. 
Encouragement of exports of farm products will do much to rees- 
tablish the buying power of the farmers, so that they can again 
absorb the products of factories. Since those countries most in 
need of food have the least credit, the problem is not easy, but con- 
siderable is being done. If European demand is to return, a policy 
of financing exports is better than a readjustment of farming only to 
have to change back when the demand returns. 
If the countries of Europe are to economize so that they will 
call for less food and clothing from the United States, or if they 
develop their colonial possessions or otherwise become more nearly 
self-sustaninig our farming must be adjusted to the new conditions. 
For some years a study of world supply and demand for farm products 
will be of unusual importance to American agriculture. Until the 
future demands are better known, it seems desirable not to make too 
violent changes in our agriculture. If European countries turn to a 
self-sufficing economy, our farming will necessarily have to be re- 
adjusted. If our National policy is to be one of a self-sufficing farm 
economy, we can for example produce more of our wool and sugar, 
and produce less cotton and pork for export. A settled national 
policy must precede a settled farm policy. 
In any event, the individual farmer may well turn to a more nearly 
self-sustaining system of farming. Farmers are forced to a policy 
of retrenchment. Drastic reductions in business costs and living 
expenses have been necessary. A policy of making the farm produce 
more of the food for the family and otherwise become more nearly 
