The Waterbury Democrat., 1935-04-03
THE NEW DEAL WASHINGTON
Wallace Pins Hope for AAA On Rainfall |. Cut In Textile Production to Save High Cost Mills Fear Farm Chiseling.
By RODNEY BUTCHER (DennOcrat Washington
 CORresuOndemtl

By RODNEY BUTCHER
 (DemOcrat Washington
 CORfespOndent)
 Washington, April 3--Secretary Wallace hopes q kind Providence loves him better than the politi- clans 6o. Otherwise, the AAA will be sunk.
 Drouth conditions paralieling those of last year would m a k good the assertions of those who insist the farm program already has collapsed.
 Even the administration would be tempted to join those who in- sisted the 1884 drouth was pun ishment for transgression of di. vine law against crop reduction.
 Given a break by the weather, however, AAA probably will con. tinue with no great change. Cur. rent political attacks from cotton states and popular reaction against high food prices aren't ex- pected to grow strong enough to interefere.
 AAA and processing taxes are the best answer to the farm prob. lem the administration has been able to think of and the other programs suggested are too radi- cal for its present mood.
 Wallace has a statistical hole ace which he thinks will help stal off the cotton state senators, though he isn't talking about it. Cotton exports, to the accomplish ment of loud walls, have fallen to 60 per cent of the previous 10- year average.
 But foreign consumption of American cotton has dropped 10 but 80 per cent, which indicates foreign buyers purchased heavily when cotton was cheap and have been using up large stores. Export Rise Expected
 Exports, according to this the- ory, should be rising again by April or May. Industrial exports have been only 66 2-3 per cent of the 1o.year average.
 Southern senators are seeking a high government loan value on cotton. abolition of the proeessins tax, and an export bounty. Pres ent indications are they won't get any of those things, though the politicians may be able to force a higher loan figure than Wallace would prefer.
 PressLrH last year caused 1t to be set at 12 cents pound in- stead of 10, as Wallace wanted. Other things being equal, the loan price will be set next August at. marketing year begins.
 about the market price as the Japanese Goods Flood In
 The 25 per cen, production cut for the cotton textile mills is a result of NRA's insistence on preserving the existence of certain high cost mills which would be forced out of business if the gov- ernment laid no restraints on competition. Contrary to what seems a Mide- spread impression, 1t wasn't caused by 8 flood of Japanese im- ! ports. Nor is there any evidence that the processing tax on cotton has been an important contribu. tory factor in the industry's posi- 1 ton.
 Increase in imports of Japanese goods has been startling enough. In fact. the National Industrial Recovery Board had the Jittcrs the other day when 1t found that imports of Japanese bleached cots ton cloth had leaped and bounded from 3960 yards in January, 1894, to 2.633,000 in January. 1885, and 4,348,000 in February.
 But cotton cloth imports are still only about one-half of per cent of domestic consumption. And Japan is the only country which has continued to buy its normal quota of American raw cotton.
 Fear Farm Chiseling
 Drouth in the corn belt where rainfall thus far has been normal, would be about the worst blow the AAA could think of now, when the western edge of the wheat belt is the chief prospective sufferer.
 Another cut of billion bushels In the corn crop would mean meat prices so high that the theory of crop reduction probably couldn't stand the strain.
 Current higher prices have also led AAA to fear secretly that 1t will be harder in the future to keep farmers from "chiseling" on reduction contracts.
 Combined with relatively un- restored city purchasing power, this might lead to 8 partial re- turn of the surplus conditions ex- istent when AAA started.
 Wheat farmers, now that crop restrictions have been abandoned and they are to receive benefit payments for reductions they don't make. may insist thta the advancement be continued - though they're signed up for an anticipated reduction program next year.
 The reason AAA continued to pay them was that 1t had signed up with them for a thSee-year program.
 Meanwhile, Wallace and his men find some comfort In the be- lief that meat prices aren't going much b,sher, if any. Housewives are finding substitutes for meat, many people can't buy it any more, and this is the season of year when consumption is most likely to begin falling off in any case. The combination of factors tends to keep down prices. Copyright. 1885, NEA Service, Inc. VINE STREET MAN