Evening star., 1939-05-09

taking out Of production Of large
acreage, by encouraging the use Of
these acres ip raising certain erosion
preventing or soil building crops,
rather than the soil-depieting crops
which were produced in large surplus
amounts. In this way, the Nation
would take needed steps to save its
soil resources, the farmer could re-
ceive certain benefit payments to
reimburse him in part, and thus the
production Of the particular crops
would be automatically reduced.
New Features Added.
The Agricultural Adjustment Act
OF 1888 retained the principle fea-
lures of the Soil Conservation Act
OF 1887, but introduced a number of
new features. I cannot discuss them
here for lack of time, but will briefly
refer to the marketing quota pro-
vision. While the act contemplates
the allotting Of acreage to the in
dividual farmer to produce the
amounts for normal needs, II pro-
duction is particularly abundant,
two-thirds Of the cooperating
farmers may impose marketing
quotas. These quotas provide for
storage on the farm of certain per-
centages for years Of unusual short
age, and this is popularly known as
the ever-normal granary.
1t will be noted that in the dis.
cussion I have here given Of the at
tempts made during the past few
years to help the farmer, all plans
were aimed at raising the price
level for the farmers production.
Another approach to the solution Of
the problem often discussed is to
attempt to lower for the farmer the
price he has to pay for his needs.
AS I have stated, 1t has been the
practice OF industry in time of lin
tied demand for its production, to
curtail production, maintaiA prices
and turn of labor. This, of course,
results In decreased output, de-
creased national income and de-
creased purchasing power for the
consumers of farm products, as we'll
as accentuating the farmers diffi-
Guilty. One keen student of the
question has suggested that three
things might be done from the
standpoint of industry.
/. Industry could accept a lower
rate of profit and keep their plants
operating at full time.
2. Labor could accept lower rate
OF wage, but have nearer q full
years work.
3. The processed goods could be
sold at price that the farmer and
other consumers would pay, within
their income.
Other Industry Loses.
With the farmer deprived Of a
large portion OF his purchasing pow
er through ridiculous prices, other
industry finds itself with the loss of
more than one-third of the markets
for its processed goods. Careful
studies have shown that during the
years between 1929 and 1896, the
annual income Of the non-agricul-
tural portion Of our population has
varied from ST. 200, ,00O, 900 In 1929 to
S42 ,0O0, 900, 900 in 1888. Twenty-Five
per cent of this income was and is
spent for food. Only 40 per cent of
this, however, or 88 per cent of the
non-agricultural income, reached
the farmers and this approximates
the total income with which the
farmer is compelled to make the
purchases for the needs Of the agri-
cultural sections.
I have suggested three things ths
might well be considered as remedie
from the standpoint of the nor
agricultural sections. We have dor
and are continuing to do mar
things Of a helpful, although,
necessity, palliative nature, from tn
standpoint Of the farmers. We ha,
aided greatly in the refinancing C..
farm Indebtedness at lowered rate
Of interest. We have spent large
sums in aiding the farmers to figh
insect and plant pests. We have
spent huge sums in enabling the
farmers to conserve fertility. We
have urged and helped with money
from the National Treasury the
building up Of soil resources. We
have spent large sums in rehabili-
tating farmers who have reached the
end Of their resources, and enabled
others to establish homes. We have
made credit available to carry sur
pluses and to provide working
necessities. We have made a start
on crop insurance. We have tried
by negotiation to recapture some
Of our lost foreign markets. These
and many other legislative proposals
have been Of real assistance to our
farming population.
But representatives Of the farmers
have differed greatly as to the long
range solution Of the basic problem
One group strongly advocates pro-
duction control along the lines of
the statutes to which I have re-
ferred, with the attendant compen-
sation Of the farmer for reduction
Of acreage by benefit payments from
the Federal Treasury. Another large
group believes that the matter can
be solved best by securing for the
farmer full use Of the domestic
market at a cost-of-production plus
profit price, and through a system
Of surplus control and removal en-
able him to sell the balance in this
domestic market at a price which
will secure for him a fair return.
A third school of thought proposes
by increased credit and low interest
rates, by efforts to recapture for
eign markets and develop new do
mestic uses, to build up additional
markets and, at the same time, cut
down to proper and reasonable lin
its the distribution charges which
take up so large portion Of the
consumers dollar and prevent its
reaching the pocket Of the pro-
ducer of the raw material.
Distribution Chief Problem.
I am personally convinced that
the solution Of this basic problem
as a permanent rather than q tenn
porary matter is more a problem of
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