Evening star., 1933-08-27
The World Wheat Pact.

nailed Dy competent autnOrltleS as the
most significant international contri-
button thus far to solution Of the world
depression problem That conclusion
Is based on the theory that until the
situation Of the worlds farmers is re-
lieved economic welfare generally will
remain in jeopardy. The pact climaxes
four months of patient negotiations
aimed to adjust the supply of wheat
to effective world demand and to bring
about a rise and stabiliZation of prices
at a level remunerative to agriculture
and fair to consumers. If the agree
ment works out as planned it will
mean the disappearance Of the colossal
surplus or "carryover" stock. of more
than 45o,oo0,O0O bushels in the United
States and Canada, which has hung
over the world market like a deaden-
ing pail for years.
The basic point Of agreement Is that
the big four" producing countries
the United States, Canada, Argentina
and Australia-undertake that their
exports during the crop year 193334
shall be adjusted on the basis Of
world import demand amounting to
$50 100000 bushels
The agreement is greeted in Wash
ington as a step of paramount an
portance in the efforts under the
Roosevelt recovery program to restore
prosperity not only in this country but
throughout the world. Secretary of
Agriculture Wallace, who had an i'm
portant directing hand in the London
proceedings, acting through the Amer
ican delegation, is given high credit
for the final accomplishment. An i'm
mediate result is the expected proclama-
ton by him Of fifteen per cent crop
reduction for the impending United
States wheat year If all our wheat
growers are brought within the plan
1t will mean curtailing the American
crop by around 126,Ooo.oo0 bushels
Other countries are pledged to cur
tatlment on the same scale, which was
worked out on the basis Of the aver
age acreage sown during the period of
1931-33, inclusive, after deducting
normal domestic requirements.
Surplus and debt have been since
World War days the twin bugaboos Of
the American wheat farmer 1t was
long ago recognized that the surplus
problem could never be effectually
tackled except by international agree
ment with other great producing coun-
tries. For many years there has been
universal overproduction. The result
was that stocks accumulated abnor-
mally and prices dropped to such a low
point that growers everywhere faced
eventual ruin. The essence Of what has
been achieved at London lies In the
fact that the major producing countries
are now pledged to restrict production
so that it will henceforward not exceed
consumption. OF no less profound sig
nificance Is the agreement that after
wheat has reached a price Of So cents
and fraction gold per bushel (cur-
rently 80 to 81 cents and this price has
been maintained for four months the
contracting nations will lower the tariff
barriers they have imposed against i'm
portation of foreign wheat in order to
assist their own growers. As explained
by the American delegate at London,
Frederick E. Murphy, the result of this,
1t Is hoped, will be to maintain wheat
prices at q figure which will make 1t
profitable for the farmer to grow the
great bread staple, only henceforward
he viii not face the ruinous peril Of
raising wheat on a scale hopelessly be-
yond consumptive needs. Order. not
chaos, will become the rule in the wheat
world, because production will for the
first time be systematically geared to
marketing possibilities
American farm authorities are con-
vinced that by promising not to in
crease their acreage in the next two
years and by limitation Of exports from
the chief producing nations the de-
moralization IN the world wheat market
that has been chronic since 1929 will
be automatically ended and the blocked
channels OF world trade reopened under
conditions promising definite and con-
tinuous relief.
II it be true, as is pretty generally
admitted, that prosperity on the farm
Is the bedrock essential to universal
economic welfare, the London wheat
agreement is entitled to be hailed as a
constructive achievement of inestimable
value, and a new charter for agricul-
ture 1t will affect millions Of farmers
in both hemispheres 1t grapples prac-
tically with the dual evils Of over
production and price chaos. 1t records
| another triumph for the principle Of
give-and-take that Is ever the basis
Of agreements not exclusively domestic
| in character but which require the world
point Of view for their satisfactory con-
clusion. Wheat has always been the
classic index to the price Of all COM
| modities. The fat and the lean years
of nearly every nation have been de-
pendent upon the price Of that golden
grain. So the London pact comes to
grips with fundamental issue on lines
equitable to all concerned.
|
| A world accord calls for good faith
that should not have to be policed
The idea Of bootleg wheat would bring
reeretful establishment to the world.