Evening star., 1933-01-08

From a painting by Robert zund.
he would receive the balance above the
loan advance.
If a per cent reduction in acreage
had been decided upon for that year
the farmer would be so notified by the
local committee, and he would have II
show them that he had planted nc
more than 95 acres for the new crop be-
fore his allotment would be paid.
Or if in spite of the 100-acre limit
the farmer wanted to grow $50 acres o.
wheat, he would have two alternatives
Either he could withdraw from the plar
and lose his right to receive benefit
payments for the year, or he could ar.
so acres less than the amount specified
in this second farmers contract and Il
transfer the right to plant the balance
Incomes Figured.
Assuming that wheat sells at 40 cent.
a buShel at the farm the farmers in.
come on a crop of 1000 bushels woulC
work out as follows:
Income without the plan in operation
1000 bushels at $0.40. .. $500
Income with the plan in operation
1000 bushels at S0.40. ... $500
Bounty on 1,200 bushels at $0.40 49,
Total wheat income. ..... 81 ,28(
The amount of the benefit payment
would be the same no matter whether
the farmer had a crop failure or q
bumper yield. If he had bad veal
and produced only 300 bushels on his
100 acres, he would still get the bene-
fit payment on 1900 bushels which
would provide a form of crop insur-
ance; while if he had a bumper croI
and had 5000 bushels to sell, the bene-
f1t payments would still be Just the
same on 1900 bushels.
The Secretary of Agriculture, or what
ever central administrative authority
might be designated, would have lati-
tude to admit new farmers to the bene-
fits of the plan on a basis permitting
gradual increase in their crops from
small beginnings to a fair proportion
of the total crop raised within their To-
calities. Where farms merely changed
hands, so also would the domestic al
lotment rights. In case of a severe crop
failure, farmers would receive the boun-
ty on only so much of their allotment
as they were able to deliver. Thus the
excise tax on the professor would al
ways be the source of the bounty pay
mentS.
Surplus Would Not Grow.
Since wheat prices would still be left
undisturbed at the world level, use OF
wheat for feeding chickens, hogs and
other live stock would not be interfered
with. Therefore. the surplus would not
be increased as it would if wheat prices
were raised too high for feed use.
On cotton, tobacco and rice the plan
would work much as has been outlined
here for wheat, except that the domes-
tic allotments on tobacco might be
worked out separately on the different
kinds of tobacco SO as to adjust the
production of each to its own demand
When the plan was applied to hogs,
corn acreage as well as production OF
sales of hogs would be controlled, so as
to prevent the reduction in hog sur
pluSes from leading to new surplus OF
beef or lambs.
1t is estimated that the bounty pay
mentS to farmers on wheat alone would
range from $4,000 900 to 5000, 600, 600
a year and that the restricted produc-
ton would mean rising prices until they
reached the pre-War level, or, in any
event, until the commodities exchanged
for manufactured goods in ratio fixed
by law as fair" Then the aid OF the
Federal plan would be withdrawn.
In a dozen variations, the underlying
principle is the same. The fundamental
advantage claimed is that production
would be controlled if it worked; the
be harder in practice than in theory
to get farmers to curtail production and
that the bounty would degenerate into
Federal hand-out. In fact, at the
very beginning of the committee hear
ingS a rift has developed between the
theorists, who insist on the double ef-
feet of production control and imme-
date cash for the farmers, and the
politicians, who are content to stop with
the cash payment and make no attempt
to limit production, on the theory that
the additional money in circulation
would help start the wheels of industry.
Conservatives Oppose idea.
While the idea has captured a foot
hold in the East, chiefly because of its
claimed ability to check the downward
spiral of prices generally, the resistance
comes chiefly from the conservative
school of thought to which any inter-
ference with the natural forces of sup
ply and demand is repugnant. Its con-
stitutionality is challenged on the
ground that it would tax the whole OF
the people for the benefit of class.
This objection the sponsors propose to
meet by the legislative device of pro-
viding for the excise tax in one section
of the measure and for the payment to
farmers in another, without stipulating
that the payments are to be made from
the proceeds from this tax. They con-
tend that in any event the excise levy
is justifable under the general taxing
powers and differs little from the pres
ent tobacco tax paid by manufacturers.
The payment to farmers, they main-
tain. Is on all fours with other Govern
ment subsidies. Newspaper mailing
rates and ocean mail contracts are cited
as analogous. The administrative prob
lem would be enormous, probably the
greatest ever undertaken in this coun-