of the effect that it will have on the stabilization of prices to the ultimate producer? Mr. WATTS. I will say, in answer to that, it was the idea of the Farmers' Union when we organized the first cooperative selling agency, which was very crude, that we would become strong enough to cooperate together with other agencies, and we would be able to put our feet under the table with the packers and have something to say as to what our livestock should bring. Mr. KETCHAM. What is your hope now? Mr. WATTS. My hope is much better than it was when we started in 1917. Mr. SWANK. You mentioned the Farmers' Cooperative Co. What do the farmers have to do with it? I am just asking for information. Mr. WATTS. The selling agency? Mr. SWANK. The one you are speaking of particularly, the Farmers' Union organization. Mr. WATTS. We have in Chicago 19,000 members of our selling agency. There is the Farmers' Union Livestock Commission of Chicago and St. Paul, a corporation composed of different farm organizations. Any of the State-wide farm organizations with 1,000 or more members can become a member of the Farmers' Union Livestock Commission by paying $50 and placing a man on the board of directors. Any man that does business with the Farmers' Union Livestock Commission must become a member of our organization before he can participate in the savings. Mr. SWANK. You have had a lot of experience in the livestock business, and something was said about the McNary-Haugen bill. I would like to have your judgment on that. The McNary-Haugen bill provides for the handling of livestock, and do you think that will help your business? Mr. WATTS. I am going to plead ignorance of that bill. My judgment on that would not be worth anything. Mr. DOYLE. You have cooperative shipping associations and cooperative selling agencies? Mr. WATTS. We do business for cooperative shipping associations. Mr. DOYLE. You do business with them? Mr. WATTS. Yes. Mr. DOYLE. Could you tell me what percentage of the business the cooperative selling agency handles for the shippers' associations? Do you handle all of it, or is it handled by separate organizations? Mr. WATTS. We handle very little of it. There is any amount of that that goes to the old line companies. I think that is through a lack of education. Mr. RUBEY. That last remark of yours makes me ask you this question: How do you get along with your competitors up there? Do you have much trouble with them, or do you get along smoothly? Mr. WATTS. Well, I was declared an outlaw by all the commission men in 1917. However, I still speak to Mr. Everett Brown and Mr. Gaywood and the balance of the boys occasionally. The Farmers' Union Livestock Commission has never had any serious troubles with the livestock exchange, other than the fact that we have had a clash a few times on settlement agreements that they make at their meetings and distribute out through the yards. I was going to say that we have gotten along very nicely. Mr. RUBEY. One of the reasons I asked the question is I understand that when these organizations are first established at the marketing yards, for instance at the National Stockyards, our Missouri members claim that they were not allowed to do businessthat they had a whole lot of trouble before they could do business. I was just wondering whether you had had that sort of trouble in Chicago? Mr. WATTS. I will say to you that there is no trouble that the English language can describe but what I have had on the market. Mr. RUBEY. That is what I want to get at. Are you overcoming those difficulties? Are they becoming reconciled to the fact that you are going to do business up there and that is one of the things that they have got to compete with? Mr. WATTS. I do not think they recognize any more to-day that we are going to compete in the cooperative commission business than they did at the time they wrote me the letter saying that they could show me no courtesies in any way, shape or form. That is another lack of education on the part of the old line firms that are not convinced of the fact that we are going to do business. The CHAIRMAN. Have you any comment to make as to the weighing and docking facilities? Mr. WATTS. It has always been my theory that the weighing should be handled under this act, or supervised by the Government. The docking is a different proposition. I have been trying to have a complaint settled with the department which was filed 11 months ago, in which I asked this question: Is the man that docks hogs at the scales a public servant or is he owned body and soul by the packers and exchanges? If he is a public servant I demand his services. I claim he is a public servant because his salary is paid by the producers of the country and he is hired and fired by the livestock exchange and the packers. I contend that that man is a public servant and he should be supervised by the Department of Agriculture, and that every selling agency in the market, regardless of whether they are old line or cooperative, is entitled to his services. I have not been able to get that yet, but I never get discouraged. Mr. JOHNSON. Have you framed an amendment to this law covering that? Mr. WATTS. There is one in there covering weighing and docking recommended by the Department, which has our approval. Mr. SWANK. You were formerly an old line commission man? Mr. SWANK. Of course that gives you good experience? Mr. WATTS. Yes. Mr. SWANK. When did you quit the old line employment and go into the cooperative? Mr. WATTS. I quit the old line commission business in 1913 and went on a farm out in Nebraska. I joined the Farmers' Union, when I was on the farm because the principles of it looked good to me. They sold it to me body and soul from the bottom of my feet to the top of my head. Mr. KETCHAM. From your experience on both sides of the proposition, would you be willing to give testimony as to the relative efficiency of this marketing work as performed by the cooperatives as against the old method? Are you doing it as efficiently, judging from the standpoint of the producer? I am trying to get his viewpoint? Mr. WATTS. Any cooperative commission firm that can not give as good service as an old line commission man is not going to be able to hold its business. Mr. KETCHAM. And your business is growing, I understand. Mr. WATTS. It is growing. If there is any difference the cooperatives have given better service than they have ever had given them before. Mr. KETCHAM. You answer the question of whether or not you are doing it efficiently, when you say that your business is increasing. Mr. WATTS. We consider that on the whole our competitors give them worse service. Mr. KETCHAM. How do you arrange this matter of docking, if you can not get the services of this man? Mr. WATTS. We are handicapped a little bit on that problem. We have our head hog salesman and the head buyer for the packers, and we have made this arrangement. The packers have a man at the scales to take the weights and to look at the hogs and he does that in connection with our head yardman that takes our weights, and tends to counting off on the scales. They are supposed to agree on the amount of dockage allowed on the stuff. If they can not agree if the packer wants more docking then we want to give, we reserve the privilege of putting out any doubtful hog in there and taking it back. We call our head salesman and the head buyer for the packers and let those two men look it over, and between the four men they adjust the docking. Now, that interferes with the service in the yards, because we may be in an argument over a load of hogs on the scales in the yard for maybe 5 minutes between our head yardman and the head yardman for the packer who is buying a load of stuff, and we may hold up 50 cars of hogs from outside the scales, not only our hogs but the hogs of old-line firms. I have told Everett Brown's bunch that I thought that was really boy play in refusing us the services of that man, as long as he was a public servant and paid by the livestock producers of the country. Mr. JOHNSON. I would like to know how it happens that the packers have charge of a man employed by the Government. That is what I would like to know. Mr. WATTS. He is not employed by the Government. If you boys would like to know about the docking system I will be glad to give it to you. Mr. JOHNSON. Surely, I want to hear it. Mr. RUBEY. I would like to hear it also. Mr. WATTS. Several years ago I was a member of the livestock exchange. They had a national meeting each year of the National Livestock Exchange, which was composed of all the local livestock exchanges of the different markets. We used to take up these problems at the national meetings and straighten them out and submit them to the local exchanges to be ratified. There was always a dispute on this docking proposition. In some cases it was used to the detriment of the producers of the country. We undertook to solve the docking proposition. We threshed it out at one of our national meetings, which I think was out in Pittsburgh, and we arrived at a docking rule: That each livestock exchange should select a committee of two or three members that would have charge of the docking; that they would hire a man to be placed at each scale to inspect these hogs as they came off the scales, and if either party was not satisfied with, his decision, then we had a chief docker, as we called him, who would look them over and make his decision. Then, if either party was not staisfied with that we had an arbitration committee consisting of two from the livestock exchange, and one from the packers. Now, I would like to ask some of these livestock men, Mr. Brown or Mr. Gaywood or some of you, that if I do not get this quite correct, that you will correct me, because I want it exactly as it is. At any rate we had this committee to pass upon it, and that was final. If we wanted to have the services of this board of appeals. or whatever they call them, the chief dockers or arbitrators, we had to pay for that. That was charged up to the shipper in the country. Their decision was final. Whatever they had to say as to the dockage on a load of hogs, that went. They have a committee from the livestock exchange and from the packers and they have full charge of the docking at the different scales. They can hire them or fire them. I have served on the committee a number of times. The only objection that I ever had to that on the exchange was that if the packers came to us and told us that they had a man at No. 7 scale, for instance, that was not satisfactory, that was not docking enough hogs, we never told the packer that we would leave the man there, but we would fire him and hire another fellow. I do not think that the livestock exchange or the packers who buy this stuff should have the authority that they have in the docking. I think it should be supervised by the Government the same as the weighing in the yards and everything else. There isn't a livestock producer in the country that isn't willing to pay for that service. There isn't a livestock producer in the country that I have ever heard of that will refuse to pay for the weighing of this livestock if it is supervised by the Government. Mr. SWANK. What is the reason that your organization has nothing to do with this docker? Mr. WATTS. He belongs to the livestock exchange. Mr. WATTS. The livestock exchange in the different markets is a voluntary organization of commission men. It is an organization composed of commission men, and in some cases traders. Mr. JOHNSON. Does it include the cooperatives? Mr. WATTS. Oh, no. Mr. JOHNSON. What is that? Mr. WATTS. I should say not. Mr. JOHNSON. Does it include the old line dealers? Mr. WATTS. Yes. Mr. RUBEY. Aren't there laws in one or two of the States requiring that cooperatives shall be admitted to the exchange? Mr. WATTS. That is the grain exchange. Mr. PURNELL. Would you suggest any plan of appeal from their decisions, or set up any machinery there with a Government man in charge? Mr. WATTS. It wouldn't be a bad idea.. Mr. PURNELL. You might have reasons to honestly differ on either side of the proposition. Mr. WATTS. We would be in favor of having a committee consisting of a representative of the cooperatives, of the old line firms and the packers. There isn't any of them that are thieves or dishonest. There isn't any class of people on the face of God's earth that are squarer than the livestock commission men. Of course, I am only the hired man running the firm, but I want to say that there isn't any of them but what would pass their very best judgment on anything of that kind. Mr. PURNELL. I am assuming that the men connected with this business are inherently honest and that whatever sharp differences might arise are largely attributed to keen competition. Mr. WATTS. I think your suggestion would be mighty good, to have a committee to appeal to. Mr. VOIGT. What is the chief cause for dockage? Mr. WATTS. They dock stags and pregnant sows, and they take some off for a bust. Mr. JERRYM. The dockage doesn't apply to anything but stags. and sows? Mr. WATTS. It does not. Mr. JERRYM. Not on the Chicago market. Mr. WATTS. It does in Milwaukee and other markets. A member of the exchange says that it only applies to sows and stags in Chicago. The CHAIRMAN. Would it be satisfactory to provide for a board of appeal to which appeal could be taken? Mr. WATTS. What is that? The CHAIRMAN. To provide a board of appeal to determine the question, by some representative of the department. Mr. WATTS. I would want to leave it up to the Department of Agriculture and to you gentlemen, if they can handle it. I think it would be satisfactory to 90 per cent of the producers of livestock in the country if on the back of their ticket was stamped a Government stamp giving the dockage on a load of hogs over the Government's signature. The CHAIRMAN. If a shipper of wheat is not satisfied with the inspection, he may take an appeal to the Department of Agriculture, and in shipments of hay or butter an appeal may be taken to the department, and the department will make an investigation and determine the facts, which may be used in court as prima facie evidence. Would anything of that sort be satisfactory? Mr. WATTS. That would not do in this case, because in the case of grain or hay you may be able to hold a sample for the department to look at. The CHAIRMAN. If you can not agree with the packers as to the dockage, the livestock would be segregated in order that it might be determined by the board of appeals. That would be an easy matter. For instance, if you had in five carloads of hogs one or two stags and sows, you could simply put them in a pen. Mr. WATTS. We couldn't do that, because before you could get a settlement by the department those hogs would be killed. The CHAIRMAN. But they are right there, and it could be determined inside of a very few minutes. Of course, the department men |