The Farmville herald and farmer-leader. (Farmville, Va.) 1934-1957, 1954-08-13
/. Pricing commodities out Of the
market puts government into
the business OF merchandising
farm nrOductS

the business Oh merchandising
farm products.
At a very low percentage of
parity, price supports would be
without meaning.
At a moderate level. govern
ment would be providing price
support only occasionally, In time
OF burdensome supply or a
weakened demand
At a high level. and maintained
over d period Of times. the govern
ment not merely supports the
market. the government becomes
the market. Government acquired
Al per cent Of the 1853 wheat crop.
for example.
The higher TIN level of price
support, the MOI likely it be-
comes that goverlment will sup
plant the private trade as a mar
ket for farm commodities.
3. High rigid supports incur con-
sumner resentment.
Through various forms of &C
counting, the cost of farm pro-
grams can be variousIy estimated
The Department of Agriculture.
after a careful study estimates
the cost Of farm programs pri-
marty for the support of farm
prices and farm INCOMES for the
past u years at about sos billion
before crediting processing taxes
Of approximately 81 Billion Other
estimates run higher or lower
depending on which items are
included
That price support is costly IS
evidenced by the fact that twice
during 1854 the Congress has been
asked to increase the borrowing
authority of the Commodity
Credit Corporation. first from
S6,75 to S85 billion and now up
TO $40 billion. OF present CCC
inventories and loans. about 80
per cent consist OF the basic COM
modities supported at 80 per cent
of parity.
4. Parity is not equality.
The longer uneconomic price,
support programs are continued
the more injurious they become
to- sound government. Excuses
have been freely offered that
other Segments of our economy
are being subsidized SO therefore
it is right to carry out any kind
Of q subsidy under the farm por-
gram, The argument that parity
is fair and therefore farmers are
receiving less than a fair price
when commodities are supported
at 80 Per cent of eaarity will not
bear close examination. Parity as
presently calculated is price
which gives the same quantity Of
a commodity the same purchasing
power as 1t had in some past
period, usually I9l0-l4. This does
douS advances that have occurred
with respect to the lowering of
the cost of production of some
commodities and the resulting
increase in the quantity that can
be produced with the same
resources while the cost of pro-
duced of other commodities has
remained relatively constant. In
the case of wheat, the cost of
production, due to mechanization.
better yielding varieties, etc. is
approximately onc-third of the
support price in the efficient pro-
duclng areas of the United
States. Hybrid seed corn and
nltrogenous fertilizer, along with
INFLAMMATION. likewise h ave
brought about dramatic improve
nent in the quantity Of produc-
ton III the case of corn. Since
Tor the same OF lower cost of
production a much greater guam
tlty car be produced now than in
the base period. old" parity is
TOO high on some of these com
moditles in relation to other com
modities To those who insist that
producers must have 90 per cent
OF parity supports in order to
obtain a fair price, we call atten-
tl0h to the fact that today the
average price Of grapefruit is
ABOUT az per cent of parity. Yet
we. 60 not have the grapefruit
producers insisting that they need
prlce~Support program, Oranges
nave consistently averaged in the
neighbDhood from 40 to 60 per
cent OF parity. yet the orange in
duStry does not believe the answer
Is price support.
'. IMPAIRS OUR RELATIONS
WITH FOREIGN COUNTRIES
l. Import restrictions
AS price is supported at levels
that result in profitable prices to
domestic farmers. they attract
sizabie imports into this country.
To help protect the government
from being flooded with imports
to add to the excessive production
IN the United States. barriers to
imports must be built higher and
nlgfrr The result is bitterness
and misunderstanding among the
people of other Iapdo y,ho t