Evening star., 1940-01-01
New Deal 10 Cite
Tariffs in Fight for
Farm Benefits Tax
Certificate Plan Would
Place Cost Of the Aid
Outside Of Budget
By the Associated Press.

By the Associated Press.
Administration farm leaders are
preparing to do lot Of talking
about "industry's protective tariff
in their efforts to win congressional
approval OF. a tax to help finance
crop-control payments to farmers.
They call their new farmers in
come certificate program" the
counterpart of tariffs which protect
industrial goods from lower-price
foreign competition.
The certificate program is pro-
posed to replace payments out OF
Treasury funds for farmers who
comply with the Federal Agricul-
tural Act. It is encountering oppo-
sition from some quarters both in
and out of Congress.
Under such a program, producers
of specified crops would receive Ger
tificates from the Government
which professors and other crop
purchasers would have to buy. The
certificates would be valued at the
difference between the parity" or
pre-1914 price of such commodities
and the lower market price. AS in
the case of the invalidated pro-
cessing taxes, officials said. the cost
of the certificate could be passed on
to the ultimate consumer.
Placed Outside of Budget.
This program, explains j. B. Hut
son, assistant chief of the Agricul-
tural Adjustment Administration.
would place outside of the Federal
budget large part Of the protection
given farm income under Govern
ment programs, just as the protec-
ton afforded other industries by
means of import tariffs does not
appear as an expenditure Of Federal
funds"
Crop control officials want par
ticularly to obtain adoption of the
certificate program at the coming
session of Congress. 1t would avoid
the necessity of their appealing to
each succeeding Congress for the
money needed to make parity pay
ments. These officials believe it
might be more difficult to obtain
such appropriations after the 1910
election.
Here, in brief, is how the plan
would operate:
The Agriculture Department would
estimate the quantity of each COM
modify needed for domestic con-
sumption. A corresponding num-
ber of certificates would be distrib-
uted among farmers who cooper
ated with crop control programs.
Price Based on Formula.
The price of the certificates would
be based on some prescribed
formula. such as the amount by
which the market price fell short
of the parity price. Each eligible
producer would get certificates equal
to his share of the quantity of the
commodity required for domestic
consumption.
The cost of the commodity for
domestic consumption would be the
regular market price plus the GER
tificate rate. 49,.
A person making the first sale
OF articles manufactured from the
farm commodity would have to OBJ
tain certificates, which he nigh,
buy from a Government-operated
pool or directly from farmers. ~
Thus, from the standpoint of the
producers and consumers, the GER
tificate plan would have the same
economic effect as a processing-taz
program.
Processing taxes were levied under
the taxing power of Congress anc
were invalidated by the Supreme
Court on the ground that the tax
ing power could not be used t.
regulate farm production. The GER
tificate plan on the other hand
would be based on the authority O.
Congress to regulate interstate ant
foreign commerce.