Evening star., 1924-04-04

| terpret farm prices into the purchas-
ing power which they maintained
prior to the war.
The proposed law would dump the
surplus upon the world market to
get rid of 1t, until through the op-
GRAFTON of shortening home supply
the home prices on farm staples would
regain the price ratio to other staple
commodities which they had before
the war, when farming was fairly
profitable.
The operation of the law would be
limited to five years, but might be
terminated earlier by order of the
President.
The personnel or machinery for it's
functions would consist of two bodies
corporate: % An agricultural export
commission to study conditions and
define policies, and (2) an agricul-
tural export corporation to buy and
export products, operate plants and
elevators or mills If necessary to
carry out the policies in detail. Ex-
listing commercial organizations-ex-
! porters, etc.-will be utilized so far
as they will cooperate, but private
speculation will be suppressed
The agricultural export commission
| Will lHe OeCTeCdTy ol A5Tl-
| culture, chairman, and Secretary or
! Commerce, vice chairman: the chair
! man of the Tariff Commission, one adj
miniStrative and three other commis-
sioners. who would also be dire ctors
| OF the export corporation.
| The commission would survey the
| general situation and define the
amounts to be considered exportable
surplus. 1t would decide policies as
determined by the ten-year statistics
or the pre-war prices of general COM
| modities and of wheat or any other
| basic commodity under consideration.
/ The ratio of present index prices with
| the average prices of the same index
| commodities for ten years before the
| war would be the proper ratio for fix
| ing today's price of the basic COM
| Imodity-whea at or whatever was being
would be exported to cause domestic
! prices to rise to that ratio price.
X x
Apply this principle to the 1922
crop of wheat for concrete example:
| The crop was S56,00O.OO0 bushels
| We exported 222.o00,oO0 bushels, re-
tanning 6S4,oOO,00O for domestic use
| The world price for composite grade
| Chicago delivery, was s126. 50 we re-
oeived for the exports $27e,720 900
Applying the ratio, as above stated, the
| 1922 price should have been Sl.59 AT
| that price the total crop would have
| brought S1,2S7,7S0. 900. AS the plan
vas not in operation, the wheat sold
for home consumption at the same
price as export wheat brought only
$LO7S.560, ,000-a difference of $685.
| 100000.
The export corporation would have
bought the surplus of 222 900 900 at
! $l.59 and sold it abroad at the world
price, s126, taking a loss Of 39
! cents a bushel on the exports
But in buying at $3.50 the farmer
| would be paid in cash only s139 and
/ in scrip the balance, 20 cents. This
| applies to all the crop both what Is
exported and what is used at home
! The final settlement value of that
| scrip would not be determined until
| the end of the crop year. when the
actual loss" Of the exports and the
| cost of operation would be known
| The total value of the 1922 scrip
would be % cents on S56. 900, ,OO0
bush 300. 900. The loss" OF
! 33 cents a bushel on 222, ,O0O, ,0OO
! bushels exported would be $4,000, ,0OO
and the cost of operation, estimated
| at 1 cent, would total $2,222, 900, sc
the balance of, say, s96,O00,000 would
/ represent the value of the outstand-
! ing scrip of a face value Of SILL ,0OO,-
600. The scrip, therefore. would have
a redeemable value of 96-l71 of its
| face as a premium on the cash pre-
| viously paid for the wheat, giving
| the farmer total of S1.57 for his
| entire crop. The same process would
apply to all other staple products OF
| the farm of which there would be an
| eXportable surplus
! 1t is especially important to note
| two points: Q) There is no arbi-
| trary guarantee of price; (2) the
| loss on dumping the export surplus
! on the world market would not be
| borne by the government, but by the
! total crop. The misunderstanding OF
| these two points has led to general
confusion concerning the measure.
Copyright, 1924. by Paul V. Collins