Evening star., 1934-07-29
See.Saw of Farm Products Prices .
And Cost of Living Present Problem

oJLuptoiu VI a SpiCeduAs uiONCHlCi4t.
A deliberate drive is on to cut the
costs of building, through a reduc-
ton both IN wages and in materials,
as well as in financing. Some of the
cutting. as in textiles, is made in en-
effort to move an accumulation Of
excess goods.
At the same time that industrial
prices are tending to move downward,
agricultural prices are heading up
ward. Bread has been advanced in
price in some centers. Butter is
higher than it has been in three
years. Milk price increases are being
authorized for some cities and pres
sure for increases is expected to
spread. Meat prices are tagging, be-
cause Of the liquidation of farm ami
mails that no longer can be fed and
watered In the drought areas. But
Mr.. Wallace is of the opinion that
live stock prices will be surprisingly
high before many months. That
means more expensive meat.
In simple language, officials see on
the horizon budding new problem
1t is that of the high cost of living.
Industry is to be pressed by competi-
ton, according to plans now being
drafted, to lower its prices in an ef-
fort to speed up production and Gre
ate new jobs. This may mean pres
sure against wages. And at the same
time the cost of foodstuffs and of
clothing-the necessities of the wage
earner-win be tending upward.
That suggests new complications.
Secretary Wallace thinks it will
bring shift in the center of attack
on the farm program. Until now
the effort has been directed to con-
yincing farmers that they really were
being injured rather than helped by
the Government plans. Now, If the
Secretary is right, the effort is to
be made to convince city workers
that they are paying a cash bounty
to farmers out of already meager
wages, and that this is causing the
pinch of -high living costs.
But involved is a complete shift in
the A. A. A. policy. No longer is it
necessary to finance the destruction
OF pigs or the plowing up of cotton.
hC CAOCoc VI dSTtCu1JuTdl CQmmOQ1-
ties has been wiped out or is being
wiped out in most Of the major crops.
That means new form Of adjust
ment. From now on the effort will
be to prevent the rebuilding of huge
excess supplies such as grew up in
this country after the collapse of
foreign trade in 1890 The A. A. A.
will offer the machinery through
which farmers can cooperate to hold
their output closer to the normal
demand.
1t even is conceivable that the Ad-
Justment Administration might be
called on to finance an expansion of
some crop in which there is a short
age. However. Secretary Wallace dis
counts that possibility. What he and
other members Of the administration
DO see is concentration of attention
on long-range plans for agriculture
during the breathing space that is
lkely to be provided in the next year
or two
AS prices rise toward parity" and
as industrial prices come down. as
they are starting to do, then the
processing taxes now levied on wheat
and cotton and corn and hogs and to-
bacco may be reduced.
And all of the time, Secretary Wal
lace is stressing the fact that normal
ly the United States produces a big
surplus of farm products, even when
only its best farm land is utilized
and that in the end the solution of
the farm problem lies only in an ex-
panded outlet abroad for the surplus
products. He is banking on tariff
bargaining, now getting under way.
to come to the aid of agriculture by
the time there is new pressure of
supplies.
While that is going on, city workers
are likely to find that parity" for
farm products means expensive food
stuffs. when compared with the prices
of recent years. But as A. A. A. off,
cials see it, better farm prices in the
end are going to mean jobs and
higher wages for the cities. Farmers
are known as the worlds best spend
ers when they have money.
(Copyright, 1934)