Evening star., 1939-02-23
Wallace Lists Three
Ways 10 Deal With
Cotton Surplus
Secretary Indicates
Thot He Fovors
Subsidizine Exports
BY the Associated Press,

By the Associated Press.
Secretary Wallace outlined today
three possible plans for dealing with
the large surplus of American cotton
and then indicated he favored some
means OF subsidizing exports.
The administrations farm chief
appeared before the Senate Agri-
culture Committee as it began pub
lie hearings on several bills dealing
with the cotton surplus.
Declaring the present administra-
ton farm program was "funda-
mentally sound" Secretary Wallace
said it had kept cotton prices from
falling below present levels and the
surplus from growing much larger
than it now is.
At the same time Mr.. Wallace said
the program could not continue to
pile up stocks of cotton under Gov
ernment loans and ignore the de-
creasing exports of American cotton
to the world.
Three Plans Listed.
The Secretary said there were
three possible ways of dealing with
the surplus problem:
!. To continue the present loan
program and find some way to place
American cotton in world markets
ION competitive basis"
2. A program of increasing cotton
growers income so they would give
up Government loans and permit
large amount of cotton to flow into
domestic and foreign channels.
3. A plan for fixing high price
on domestic cotton that would let
the surplus flow into world markets
for what it would bring.
Recalling that cotton growers had
voted to continue the present con-
troll and benefit program with its
mandatory loans, Secretary Wallace
said any change this year in loans
might be breaking faith with grow
ers."
Nevertheless, he said, continual
ton of loans required a definite
control over production.
Little Comment on Price Fixing.
The Secretary said the second
plan would require a great increase
in Government appropriations.
He made little comment on the
domestic price-fixing plan, which is
one of the proposals before the COM
mittee, other than to indicate this
would require very high price,
possibly 40 cents pound compared
with present prices of about cents.
Answering question by Senator
Bankhead, Democrat. of Alabama,
Secretary Wallace said a possible
world conference among cotton-pro-
ducing nations in an effort to work
out some share basis on production
was under consideration.
The Secretary said this had been
discussed at the White House, but
added that it involved longtime
program.
Chairman Jones Of the House
Agriculture Committee expressed the
opinion, meanwhile, that the Gov
ernment may have to try some new
approach to solving the farm prob
lem.
Kennedy Questioned.
Without elaboration, Representa-
tive Jones asserted during commit
tee hearings on cost-of-productio
bills:
I'm not sure we're not going to
have to work out something along
a different line (than the present
plan)."
Chairman Jones and Representa-
tive Hope, Republican, of Kansas,
ranking minority leader of the COM
mittee, questioned Edward E. Ken
nedy, Farmers Union leader, about
the possibility that the cost-of-
production theory would ruin the
small or tenant farmer.
The proposed legislation would
guarantee a farmer a definite price
for that part of his production con-
sumed domestically.
whats to prevent a man in the
city-with wheat at $l.25 bushel,
let's say-from getting tractors and
planting the whole lot of land he
has himself and let his tenants go?"
Representative Jones asked.
isn't there grave danger that
you might drive the whole thing
into the hands of the big farmer?
Wouldn't it have tendency to drive
away many tenants?"
Mr.. Kennedy replied:
In my judgment, when you have
stabilized minimum price to cover
a reasonable cost, you will have your
little farmer left and you will have
your tenant farmer left and he'll
be in better position to stand his
ground"