The sun., 1919-02-06
ALLIES MUST BUY
WHEAT ON CREDIT
U. s. Grain Corporation Head
Says They Are Unable to
Pay Cash.

WAsRINaroN. Feb. b.---If the United
States is to sell It's surplus wheat to the
Allies this year the Transaction must be
on a credit basis, Julius Barnes. head of
the Food Administrators grain corpora
tlon. told the House Agriculture Com
mittee to-day at hearings on legislation
to provide a method for carrying out
the Governments guaranteed price of
s2.2s a bushel for the 1919 wheat corp.
The Allies have not the financial ability
to pay cash for the wheat, II was eS-
planned. and the United States Govern
ment will have 10 extend further credits.
At present the Treasury has no power
TO make loans to the Allies after peace
Is declared. although Congress is con-
sdcring n Treasury request to be per-
mitted, to extend the unused portion.
about $500. 900. 900, OF credits already
| authorized for war loans to Allies for
peace time purchases in this country
100000 IL Advanced.
In this connection Representative
Young (Texas) said he understood
| Great Britain wac going to South
America for grain because Argentina
was lending money to finance the deals.
Mr.. Barnes told the committee that the
Allies had agreed 10 surrender thor re-
| sale option on 100, 10000 bushels OF
wheat contracted for in this country
and would take the grain. the Treas-
ury having advanced s2oo,ooo,ooo TO
| finance the transaction.
Representative Mclaughlin tMichi-
| gam declared that for all the loans
made the Allies the United States had
| only scraps OF raper-I. o. US signed
| by their representatives In Washington.
! instead OF bonds which the law pro-
vided should be given as collateral"
Representative Young (Sorth Dakota)
| said properly executed notes had been
given for the loans, and that no Secre-
| tary OF the Treasury would have ac-
| cepted anything less.
Mr.. Barnes. in concluding his testi-
! mony to-day. recommended that Con-
| press appropriate $1,000. 100000 to
| finance the marketing OF the new crop
and give the President broad powers
over the export Of wheat and trading in
| this country.
Mr.. Barnes asked authority to Dor
row more. II necessary, on the credit and
property OF the grain corporation. and
| authority TO buy and sell wheat and
wheat products at home and abroad for
| cash or for credit. He also asked that
! import and export embargo powers. au-
thority to build or requisition storage
facilities and to license dealers. millers
| and elevators, control over exchange
| trading and authority to give prsferen-
| tial rail service on American railroads
and steamships In transporting cereals
to markets at home or abroad be given
| the President.
| 34s,OOO,OOO Bushels for Export.
! MIR. Barnes said that after deducting
| 100. 100000 bushels OF wheat for seed
and <7o.00o.O00 bushels for homo con-
sumption. there would be left available
! for export trade 100000 bushels.
He said OF this amount 100000 had
! been exported UP to February l last, and
against this the following commitments
were to be applied to wheat or wheat
nour:
| European Allies 100. ooo.o 900 bushels
Commission for Relief in Belgium. 20.-
| 100000 bushels; European neutrals,
100000 bushels, and European relief,
100000 bushels.
| These exclude" Mr.. Barnes said
"any contribution TO enemy countries,
such as may be approved by the SUI
preme council on supply and relief or
the armistice authorities, but also these
enemy country necessities may be salts
fed with rye and other grains. instead
Of wheat, should we be short available
| wheat"
The Grain Corporation now has on
hand, Mr.. barnes said. $4,000, 600
bushels of wheat ar1 Is 900. 900 bushels
OF wheat -four Replying to Representa-
| tive Wason On. H Mr.. Barnes said
that there was no indication at present
that there would be reduction in the
price of bread.
He said It was necessary TO protect
the millers against loss or there would
be dangerously low level OF -four avail
able rs the period OF Government
guarantee drew to a close on June /,
1890.
Treasury Prevented "DebacIe."
The witness declared that except for
aid by the Treasury IN the last year
there might have been "debacle" IN
the wheat guarantee. because the Law
establishing tho guarantee c.1 rot give
the means OF making 1t effective He
said money advanced by the Tren sury
to foreign Governments for the purchase
of grain gave the corporation workins
capital necessary to market the crop
which II could not obtain in any othe;
way, having no borrowing power.
The 100000. 900 capital of the cor,
poration, he said, will be returned to ths
treasury with ordinary interest when the
organization IL dissolved. and II In pos
sihle that much OF the $1,000, 900, 00(
asked to finance the new crop will be re
| turned.