Evening star., 1938-07-17
BY BLAIR BOLLES.

X grain on Whlcn the agricultural
economy Of great part of our
West is founded. the Department
Of Agriculture Is reaching for the
smelling salts. In the announcement
that Americas wheat farmers are
about to present this country with
their second biggest crop in history. the
department sees prospects of lower prices,
lower incomes for the growers and in
creasing uncertainty Of the chances for ex.
porting the grain. 1t sees also an oppor-
tunity to put the Agricultural Adjustment
Act of 1888 on the center of the stage.
The farm law is about to 60 into opera
ton in the face of wonder whether it can
avert the calamity Of the country,s having
too much wheat to consume and to export.
Even China in this year of her woe has a
wheat crop as large as last years. The
administration looks on the pending British
trade agreement as a partial way out of
its difhculties, and in London Ambassador
Kennedy is suggesting a world wide ever
normal granary. Farmers in 80 States
raise wheat, and the economy of wheat
affects deeply the economy of the whole
country
In part, the 1888 farm law was framed
to meet just such crisis as the .one con-
fronting Secretary Wallace and his aides.
To the experts the tremendous crop is no
surprise Perfect wheat-growtng weather in
I the spring and the large acreage seeded
made bumper production apparent. A
month ago, when the harvest of winter
wheat was about to begin, the Crop Report
ing Board predicted crop of $4,000, 900
bushels more than the 967,412 900 it fore
sees now, when most of the winter wheat
has been threshed. With the wheat car
ried over from last years crop, the total
available supply is set at about 1,147 ,ooo.-
900 bushels, while the Farm Act puts the
normal supply level at 866, 900 900.
Disease May Not Solve Dilemma.
Perhaps stem-rust, the fungus which rots
the wheat stalk, will reduce the stand of
spring wheat in the North Central States
before reapers are sent into the fields But
lot OF that wheat has been developed with
rust-resistant qualities. and the spring
wheat crop amounts to only 25l,ss7. 900
bushels-about third of the amount of
winter wheat The botanical disease prob
ably won't cure the economic ailmept.
The wheat problem, which In some form
has beset the Roosevelt administration ever
since it came into Office now suggests two
questions:
l. What con be done to keep the future
domestic output within bounds?
2. How can foreign markets be found?
To both of these the Agriculture De-
partment and the Agricultural Adjustment
Administration are trying to find the an
swers. Within the past few days the
farm law was called into play to aid the
domestic problem. Secretary Wallace an
nounced that loans would be made to
wheat farms, for the first time since
the A. A. A. program was introduced in
1888, and in ceremony at Kansas CITY
the flrst three crop insurance premiums
under the Governments program were
signed. Two more phases Of the wheat
salvation program will come into play later:
The acreage for 1899 will be restricted
and If two-thirds Of the farmers voting in
referendum approve. marketing quotas
will be fixed for wheat for the 1899 mar
keting year.
Loans Establish Price Floor"
The loan newly set by the Secretary goes
only to farmers participating in the acre
age control and soil conservation program
It is similar to the loan given in the
past to cotton and corn growers.
Its purpose is to enable farmers to hold
part OF their wheat off the market when
it is overloaded. and thus to obtain the
benef1t OF orderly marketing" according
to the Agricultural Adjustment Admins
tration. The loans are not intended to
peg prices at high levels, but are intended
to put floor under the price and prevent
Its disastrous collapse" For this reason
the loan hovers around so cents a bushel.
While the loan is protection against
the ravages of the bumper crop. the crop
insurance, ironically it might seem now
is stay against crop failure. But the
insurance in 1888 somewhat alleviates the
situation because wheat paid in as pre-
miums to the Government is stored a.
reserves and paid back to producers in
years OF crop shortage or failure. As Sec
cretary Wallace comments:
One effect of this will be to keep ex-
eessive wheat surpluses of the market in
years OF high production and to carry
them over to be paid to farmers and mar
keted by them in years of crop shortage.
This will help to maintain a reserve of
wheat and to stabilize producers incomes.
It will also protect the consumer by help
ing to stabilize food supplies and prices"
The frst three wheat growers insured
by the Federal Crop Insurance Corp. are
H. r. Pugh. tenant, from the Texas Pan
handle; NJ l. rurvines, his landlord, and
Vincent Meyers olathe, kans. Each Il In