Evening star., 1937-03-02
CROP INSURANCE
IS URGED BY POPE
Idaho Democrat Admits, in
Forum, Program May Not
Be Constitutional.

Senator Pope, Democrat, OF Idaho,
o member Of the Senate Agriculture
Committee, last night urged adoption
of the administration crop insurance
bill. He spoke in the National Radio
Forum, arranged by The Star and
broadcast over coaSt-to-coaSt net
work of the National Broadcasting Co.
"It is not certain" he admitted,
''that program OF crop insurance will
be held constitutional by the Supreme
Court. Under the decisions in the
agricultural adjustment act case 1t
IS doubtful whether this act would be
constitutional However, every effort
has been made to draft 1t to meet all
legal requirements"
Crop insurance, he said, would les
sen the amount Of money spent by
the Federal Government on rural re-
lief work and would combat the bank
ruptcy and destitution faced by a
Large percentage Of farmers" in the
drought area.
Text of Pope's Address.
The text of the address in full:
The last four years have been rich
in legislative action Of benefit to the
farmer. The 1882 farm income was
the lowest within generation. It had
decreased from about $4,000 600, 900
in 1929 to So, 100000 900 in 1882. The
income Of the farmer had decreased
more in percentage than that of other
industries. The widespread distress
of the farmer was merely a forerunner
OF general economic distress through
out the Nation. Any one who gives the
least consideration to economic trends
knows that when the basic industry
of agriculture languishes a general
business collapse inevitably follows.
At the beginning of the Roosevelt
administration it was realized that, as
first step toward recovery, legislation
must be enacted to restore q measure
of prosperity to agriculture. The agri-
cultural adjustment act was passed.
It contained distinctly new approach
to the farmers problems. There were
then 394,000000 bushels of surplus
wheat and about 100000 bales Of
surplus cotton. Exports of these COM
moditieS were at an extremely low
ebb. Since these huge surpluses ex-
listed, their depressing effect upon the
market price was everywhere realized
It was necessary, in some way, to
reduce surpluses. A substantial por-
ton was purchased and used by the
Government for relief of the destitute
A permanent program to reduce them,
however, was necessary and the agri-
cultural adjustment act was consid-
cred as a means to that end. This
meant curtailment Of production. This
principle. which had never before been
applied to agriculture, met with Sc
rious objection from many sources
Many, who were familiar with the
common practice Of manufacturers
and merchants in the adjustment Of
their stocks to conform to the demand,
could not bring themselves to approve
policy that would apply the same
principle to agriculture. 1t was COM
monty said there should be no curtail-
fnent of production so long as there
were consumers anywhere in the world
who needed these products. The fact
that Adam Smith, the great English
economist, a century ago defined de-
mand as effective demand, and that
neither the manufacturer, the mer-
chant nor the farmer could possibly
escape the law Of supply and demand
and continue to exist, did not answer
the objection in some minds.
Played Part in Recovery.
It was determined by Congress, how
ever, that an effort would be made to
reduce production and to give the
farmer benefit payments to compen-
safe him for curtailing production.
This law was in operation until it
was declared unconstitutional by the
Supreme Court early in 1886. Few
people will now deny that the act was
Of tremendous benefit to the farmer
and to the country. The fact Is it
played major part toward recovery.
When it was destroyed by the Su-
preme Court an immediate effort was
made to enact a substitute. The soil
conservation act, under which the
farmer would receive benefits for con-
serving his soil and incidentally cur
failing his production Of basic crops,
was passed by the Congress. This law
has now been IN operation for about
one year. It Is meeting with q fair
degree Of success, and unless 1t Is held
unconstitutional by the Supreme Court
1t Is destined to become permanent
constructive program for agriculture.
1t is sought now to supplement this
program with q plan for crop insur-
arlce and one for relief from farm
tenancy. Bills have been introduced
in Congress covering both of these
matters. They constitute the major
effort for beneficial farm legislation
this year.
For more than half century crop
Insurance has received the attention
of a few far-sighted economists. So
long ago as 1868 a German economist
prepared a rather complete report on
the principles Of crop insurance. This
report was In response to request
from the Japanese government. In it
the author suggested many of the
factors that must be considered in any
successful program. He called atten-
tion to the fact that it would be neces-
sary to spread the risk over large
territory; that insurance Of farmers
Yield would be practical, but that in
surance Of price fluctuations would be
exceedingly difhcult.
Private Efforts Fail.
In this country number Of efforts
were made by private insurance COM
panies to cover growing crops. These
efforts were generally attended with
failure because Of lack of capital, lin
tied area and lack of actuarial data.
These private efforts usually included
price fluctuations. Certain mutual
associations Of farmers undertook to
write tornado insurance with some de-