Arizona republican., 1920-11-14
Financial Review
By ERIC kOBBE Of BIyth, Witter & Go.
Creating a Shortage.


 That there is a serious effort being made by cotton producers to regulate the market for next year through ere ating a shortage by reduced production is becoming evident. When such an idea was first proposed it was regarded more or less as bluff, but subsequent developments show an earnest en- deavor to carry out the plan.
 The American Cotton association is taking the lead in this movement and is working along two distinct lines one in the formation of a finance cor poration which is intended to create a direct market from producer to con sumer and the other to bring about a reduction of 33 Ia per cent in the acreage of cotton in 1921. The advis- ability and practicability of both ideas are open to question.
 The plans for the creation of a if nance corporation. have already reached the point where an organiza- tion known as the American Products Export and Import corporation is in the process of organization with capital of S1O,000,000 and with Gov. R. I. Manning of Columbia, s. C., at the head of the committee in charge. The chance for success of such an organi- zation to obtain its desired end can only be guessed at but it has been proved that the presence of the mid dleman" is based on necessity and un- | less some fundamental change is made whereby the marketing of the product can be accomplished cheaper without him his elimination will be a task of no small magnitude.
 1 As regards the reduction in acreage | the American Cotton association has prepared strong contracts or pledges which are being presented to cotton | growers or owners of cotton land. i These pledges call for reduction in the cotton acreage over this year and although there is nothing legal about them they are of such a character that once signed a man would think twice about breaking the pledge. The full text of the pledge follows:
 After reading, or having read to me, the above and foregoing statements, of which I approve, and with a determi- nation to protect my own interests as well as those of my state and coun- try, I hereby solemnly agree and make this divine pledge to the American Cotton association that for the year 1921 on the lands cultivated by me, or under my control, there shall be re- duction of 33 Ia per cent in my cotton acreage planted in cotton on my farm in 1920, and a corresponding increase of acreage planted for food and feed I crops. l also agree to enforce this rule with my tenants or crOpperS tor 19Z1. If this pledge is violated by me I here by agree to permit the publication of my name in the local press of the county as willful perjurer and as be- ing unworthy the title of an honest man"
 It remains to be seen how well such a scheme can be carried out and whether or not it will be accomplish the results desired. That a diversity of crops is desirable from both the producers and consumers standpoint is beyond question, but this does not necessarily mean less production but rather a diversified market and com petition. The acreage planted to other crops will bring the farmer into com petition with other sections of thu country and thus reduces the whole question to a matter of supply and de- mand. It is problematical whether z possible gain on cotton would not bt offset by a possible loss on the other crops. Diversity will give, however a better chance for profit through moi having all the eggs in one basket, vii relieve much of the difficulty of fl. nancing and will replenish the soil fol future cotton crops.