Evening star., 1927-12-06
BACKGROUND OF EVENTS
BY PAUL y. COLLINS.

Secretary of Agriculture Jardine is
quoted as stating that the purchasing
power Of the farmers dollar is back to
within per cent of what 1t was in
1918. If that be the case, then ap-
parently there is no longer a crisis
demanding very much legislation for
farm relief. and all candidates for the
presidential nomination basing their
campaign slogan on the distress of
agriculture will withdraw from the
field.
However, Secretary Jardine never
said what is credited to him, and the
economists of the department have
very different figures to show. There
is absolutely nothing more misleading
than statistics which are misread.
The five.year period from 1909 70
1914 is taken as the index number 100,
for comparison purposes as to farm
prices received for products. In the
next Ave years that index dropped to
81. in the year 1926 it stood at 1870. in
October. 1927. it was 139. Translated
that means that the average price of
the staple farm products in October,
1927. was 80 per cent higher than the
same products were worth in the five
wears preceding 1914. But that is no
indication as to how prosperous the
farmers were, for it is only the price
per unit. and does not consider the
size of the crops nor the cost of pro-
duction: neither does it show com
parison with the cost of non-agricui-
tural products which the farmer must
buy.
While farm prices advanced 80 per
cent, the wholesale price of non-agri-
cultural merchandise was 151 per cent
of the index price in the period 1909
1914. Even on the basis of farm sale
prices for farm products, and whole
sale prices for non-agricultural prod
ucts, the industries gained 51 per
cent, while farm prices gained only 80
per cent. That makes the purchasing
power Of the farm index price only ~
per cent of it's prewar value. This
is not the result of an improving
trend, for the spread is widening.
To the wholesale price of non-agri-
cultural products there must be added
the taxes and the middleman's labor
and profit before one can measure the
comparative spread or the compara-
tive purchasing power of the farm
products. Even then no actual meas
ure of the farm prosperity can be
made without the data as to crop
yields. year by year.
II II ~
For example: The cotton crop of
last year was approximately 1S,5O0.OOO
bales. and with that large crop the
average price was 1875 cents. giving
total value of SLIPS 900 900.
This years cotton has been official
ly estimated at only IL 500. 900 bales.
but. because Of that short crop, the
average market is about 20 cents.
making a total value of S1,250. 900. 900,
about 10 per cent more for the small
crop than was realized for last years
so per cent greater yield. index
prices are unit prices only-not values
of the totals.
The same principle. of course. ap-
plies to all other mercha ndise, wheth-
er on the farm or purchased by the
farmer In a recent article written
nv Secretary Jardine he summed this
up as follows:
"rhose who produce crops of which
the market will take an increased
amount only at a more than proper
tionatelv reduced price nave reason
to be apprehensive of generally
bountiful harvest. This is true to
greater or less extent of a number of
our principal crops.
'"The result is that an abundant
crop may sell for less than smaller
one. Under such circumstances, the
farmer in effect. not only receives
no additional return for his crop. but
is obliged to pay for the privilege of
giving it away. Thus the abundance
of a crop may bring benefits to deal
ers and consumers, and disadvantage
to growers"
\ n \ "
Undoubtedly. the surest test of the
comparative prosperity of agriculture
and industry must be indicated by the
trend of populations. AS surely as
water seeks it's level. 80 surely does
population flow toward prosperity and.
away from adversely.
In 1920 the total population of the
United States was 106 100000. in 1927
1t Is rated by the Census Bureau at
1000, 900. OF that 106.000,0O0 In
1920 there were 81 ,600,0 on farms.
Now, out of the Increased population
OF 117.oooYpo there is decreased farm