The Ely miner. [volume] (Ely, Minn.) 1895-1986, 1933-01-20
WHAT'S GOING ON
IN WASHINGTON
Proposed Agricultural Relief
Bill Is Complicated and
Delicate Problem.
BY WILLIAM BRucKART

bill, with which it is now wrestling.
1t has taken hold of the domestic al
lotment plan, disguised by the new and
pleasing name, in the hope that it may
be the method of solving what every
body knows to be a most distressing
condition in a basic national industry.
There can be no doubt that the
farmers must have higher prices for
their products if the industry is to
survive, and that is the fundamental
premise upon which the farm parity
bill was drafted. Chairman Jones, OF
the house committee on agriculture,
which wrote the bill, told me, however,
that he and other members of the COM
mittee looked upon the proposal as of
an emergency character; that it will
have the temporary effect of providing
that needed increase in prices, and
that the committee members who sup
ported it thought it was worth testing
at least until such time as permanent
changes and restoration of values can
be effected.
The representatives who voted to
submit the bill to the house do not
conceal their concern over the delicate
nature of the tool with which they are
working. Along with the potential
good admittedly in the domestic allot-
ment plan, there are obviously grave
dangers of abuse, and it takes no
soothsayer to forecast that the good
can be destroyed If the weaknesses fail
to stand against practical business OPP
Grafton.
The measure that is under consider
alton is substantially that which the
three leading farm organizations have
worked out as acceptable to them.
The house committee eliminated only
one paragraph of Importance from
the draft which the farm leaders sub
mitted. That section provided for re-
peal of the sterilization provisions of
the agricultural marketing act Of
1929, under which the federal farm
board operates. The explanation Of
fered for removal of that section was
a fear of complicating the chances of
passing the relief legislation If the
farm board question should be includ-
ed in the controversy.
What the Bill Means.
To begin with, the bill provides that
at any time the price levels of wheat,
cotton, tobacco, rice or hogs are below
the prewar basis, an adjustment
charge-in other words, a tax-is to
be levied on the processing of the COM
modify in question in an amount suf-
ficient to lift the price up to the pre-
war level. That adjustment would APP
ply, however, only to that part Of the
product entering into domestic con-
sumption and not on exportable sur
plus. These premiums will be paid to
the producers who comply with the
requirements of the legislation. Com
pliance with the requirement consists
of obeying the command to reduce the
acreage.
Obviously, of course, reduced acre
age means reduced output and reduced
output means greater demand for
that supply of the product available.
So, say the supporters of the bill. I'VE
can force the prices higher"
But the bill is not nearly so simple
as those lines make it appear. The
plan requires, In the first instance,
that there be virtual referendum OF
farmers, or among them. to determine
whether the plan shall be applied to a
particular commodity. When 60 per
cent of the producers Of wheat, for ex-
ample, approve the plan for their crop.
the federal government begins to col
lect the tax, and will do so, under the
terms of the present bill. for period
of one year. 1t is provided that 1t
may be extended from year to year by
Presidential proclamation, but that Is
merely a subordinate feature.
The tax is collected from the pro-
cessor on so much of the commodity
as enters into domestic consumption.
That tax goes into the treasury, to be
returned to the producers who have
met the requirements and who have
obtained certificates covering the do
nestle consumption percentage mar
keted by them. The amount of the
adjustment is left In rather haZy
state, but the bill says it shall equal
the amount of "a fair exchange allow
ance"
This "fair exchange allowance" Is
defined as the difference between the
prices received by producers at local
markets and the "fair exchange value"
which approximates "the same ratio
as the price for the commodity paid
producers at local markets during the
base period (September. 1909. to Au-
gust. 1910 bore to prices for all COM
modities bought by the producers dur
ing such base period" That. of course,
seeks to make the difference in prices
the farmers receive and those which
they pay for commodities bought vir-
tually the same now as they were In
the period before influences of the
World war were operative.
Take the Case of Hogs.
In the case of hogs, the "fair ex-
change value" is fixed on a sliding
scale. the figure being 31a cents a
pound from approval of the act to
April 80. 1888; 4 cents pound from
May l to June 80, 1888; Az cents a
pound from July 1. 1888. to beginning
Of the marketing year of 1933-34 and
5 cents a pound after that time. plus
an additional one-half cent pound
for each increase of ten points in the
index number for factory employment
over that same number as 1t stood at
the time the act was made operative.
Reduced to simple language, this lat
ter provision seeks to establish an en-
forced upward movement of the price
as greater numbers of workers are re-
cforod IN factory nav rolls