The Washington herald., 1920-02-09
BARNES LETTER
SCORES GRONNA
Wheat Director Objects to
Repeal and Abolition Of
Grain Corporation.
REPUDIATES PROMISE
Says Senator Is "Egotist'
To Place Such Confidence
In Own Judgment.

Julius II. Barnes. United States
wheat director. has made public a
letter to Senator Gronna in which
he terms the latter's bill for the re-
peal of the wheat guarantee act and
the abolition of the grain corpora
tion as a direct reputation OF the
pledge made by Congress to the
wheat producer for the crop of 1919.
Senator Gronna's bill, which has
been favorably reported by the Sem
ate Agriculture Committee. repeals
all government control over the
price OF wheat and requires the
grain corporation to wind up its af-
fairs without delay.
Can't Predict Prices.
Mr.. Barnes points out that at a
time when no one can accurately !
predict the trend of prices. Senator
Gronna apparently feels such con- /
fidence in his own Judgment that
the farmer will benefit by the with /
drawaf of government stabilizatiOn
that he would Immediately take !
from the wheat producer the pro- !
lection of the billion-dollar guaran-
tee. which Congress has pledged it, /
self to give until June l. -
The wheat director gives warn |
Ing that by abolishing government
support Congress may precipitate a !
still further decline in the price of
wheat. even below that of the guar
antee price. He adds that "only
the most colossal egotism would
presume to forecast the course OF
prices in the face Of world wide un-
SafflADfanf Nz~hf n. 80
few days has wrecked the United
states export trade by the total col
lapse of overseas finance"
Repudiate Pledges.
II Congress should repudiate its
own pledge to the furmer. Mr.. I
Harnes adds. the possibilities of de-
probation in value after the with
drawal OF the government guarantee
are such that 5000. 900 farmers will
ask Congress by what right It re-
pudiated the pledged national guar
antee. on the underlying foundation
of which the influence of supply
and demand had built an average
premium of 80 cents per bushel."
Mr.. Barnes letter follows:
Hon. \. J. Gronna.
United States Senate.
Washington. n. C.
My dear Senator:
notice that the Senate AgricuI- |
ture Committee. OF which YOU are /
chairman. has favorably reported to
the Senate your own bill ssh. provid-
ing for the termination of the wheat
guarantee act of March 4, 1919.
OF course. this bill terminates the ef- /
fective price guarantee to the wheat I
producer for the crop of 1919. You per-
sonally realize that this would be the |
result, because in the Senate on Feb
ruary you expressed your own
opinion that. even without the guar
antee, wheat would not decline.
Have you such confidence in your
own judgment of future prices that I
you propose to take from the wheat .
producer the protection OF the billion |
dollar guarantee pledged now to
June I?
2OO.OOO.OOO Bushels on Farms.
Two hundred million bushels of J
wheat still remain on the farms. and I.
2o0OOO.c0O bushels additional i'm the I
channels between farm and consumer. /.
all of it relying on the pledged faith /
of this government that, il necessary, /.
the National Treasury stands behind /
its purchase at the guarantee level. /
That security your bill proposes to ter |
inmate, ana tnaI termination VIII {
cause apprehension with every farmer. I
with every dealer. with every miller. /
with every flour handler. with every /
baker, and with every banker. The |
withdrawal Of that underlying security /
will destroy the trade methods which 1
have furnished a ready daily market I
10 the producer at a farm price for /
wheat 800 per cent higher than the ]
pre-war level. yet protected the con- |
sumer by a bread advance of only - /
per cent. Suspended buying. with fiuc- |
tuations. increased trade margins re- i
fiectinE increased trade hazards, will /
then affect the producers farm price |
and unfavorably affect the consumers
bread price. Within the past week |
the price of wheat in Minneapolis has |
fallen 80 to 90 cents per bushel, and on
the Very day your bill is introduced. |
some kinds of wheat are down to only |
n few cents above the guarantee price !
Pass this bill. Withdrawing the un-
derlying support which the knowledge |
that government buying is potentially |
present, and you may precipitate a I
further decline. below the guarantee 4
price.
Only the most colossal egotism. my 1
dear Senator, would presume to fore
cast the course of prices in the face
of wOrld-Wlde utSettleTnent, tnat
within the past few days has wrecked /
the United States export trade by the /
total collapse of overseas finance.
Are you so sure of the stability Of /
values in the midst of world wreck I
that you would rest the national honor
on your opinion of market probabili-
ties?
I warn you, and Congress. that in |
the four months yet to 20 under that |
guarantee. there yet lies the possi-
hiIity of such n depreciation of value
following the withdrawal OF that gov
ernment guarantee. that 5000 .OOO wheat
farmers will ask you by what right |
YOU repudiate the pledged national
guarantee, on the underlying founda-
tion of which the influence Of supply /
and demand had built an average
premium of % cents per bushel.
At least you shall not then plead
that you did it in ignorance, and with
out warning of its possible results.
I shall be glad to retire from the
burdens OF this office. assumed at the |
express request of the President. but |
not until the national pledge has been
fully redeemed. without dishonor.
I have still confidence that the Ma
tional Congress. which last February |
pledged 81. 900. 900 900 to make good the /
national pledge will not hesitate to |
condemn this present attempt at re-
pudiation of that pledge.