Senator HEFLIN. So that the fees would have to be fixed so that on 1,000,000 bales it would meet that $25,000,000?

Mr. STEALEY. To meet that $25,000,000, yes, which would be 1% dollars per bale on the 15,000,000 bales, or $2, say, flat, to take care of the complete financing of that 1,000,000 bales.

Is there any other question?

Senator RANSDELL. Have you finished your general statement? I want to ask some questions when you get through with your general

statement.

Mr. STEALEY. I believe I have.

Senator RANSDELL. Mr. Stealey, I wanted to know what efforts have been made by you and your associations to get the general opinion of the cotton-producing world of the South in regard to this bill.

Mr. STEALEY. Not a great deal of effort has been put forth to get to the mass of the people in the South, because this form of legislation has not been discussed in the South generally. In Oklahoma I have taken some trouble to get an expression of opinion from comparatively few people, but I have gotten nearly the unanimous approval this theory of legislation from those to whom I have put it. Our own board unanimously passed a resolution asking for this form of legislation. The Oklahoma wheat growers have taken the same action. The Farmers' Union, which is an organization of farmers of all classes covering the entire State, and which is a rather active and aggressive organization in our State, have approved, in principle, and asked for this type of legislation.

I have received, since I have been here at Washington, telegrams from the two largest banks in our city, with whom I discussed the principles of this kind of legislation before leaving Oklahoma City, and asked them to give it further consideration and let me have their opinions on it. The first one here is from the First National Bank of Oklahoma City, which is the largest bank in that city. It is addressed to me and reads as follows:

A study of your suggested revision of the Dickinson bill convinces us that same should merit the support of everyone interested in legislation to relieve the surpluses in agricultural conditions.

The rest of that is some superfluous compliments to myself, which I will leave out.

The other one is signed by the American National Bank, of Oklahoma City, which is the second largest bank in that city, addressed to myself, and reads as follows:

We hope you will be successful in your effort re suggested revision of Dickinson bill.

The rest of that is personal compliments.

I have a letter from the president of the Oklahoma Bankers' Association, which reads as follows:

I inclose herewith copy of House bill 6563, known as the Dickinson bill, with certain amendments. You know that a great deal is being said about farm legislation in the national Congress, but a great many people believe that nothing can be done by the farmer along these lines, but some of the best minds of the country, among whom is ex-Governor Lowden, of Illinois, who has given this matter a great deal of serious consideration, feels that something can be done to relieve the situation, and that it should be done. This bill will operate to the advantage and protection of the farmer a great deal, the same way that

the Federal reserve system has been to the advantage and protection of the banker in time of stress. We are faced right at this time in the Cotton Belt with a very serious condition. We are going to have a big surplus left over after July 1, and it looks like another big crop will be planted and probably raised. This bugaboo of another big crop is holding down the price and is causing many cotton merchants to lay off the market, as there really is very little sale for cotton at this time. We who have studied this situation believe that this bill will, to a great extent, eliminate the fear of a surplus ruining the price, and will stabilize the market. You understand that the provisions of this bill do not contemplate nor require the Government putting up money to take care of this surplus, but permits the farmer himself to invest a small percentage of his crop in a fund for the purpose of taking care of the surplus crops. I hope, after having studied the bill carefully, you will see your way clear to indorse it, and to advise our secretary, Mr. Gum, by letter at your very earliest convenience.

SAM MORLEY,

President Oklahoma Bankers' Association.

I might say, gentlemen, our own personal ideas were to ask for the equalization fee to be levied at once. After discussing the situation here in Washington we were advised that if we were going to get relief at all for the present emergency and protection for what may happen this fall we would have to abandon the principle of applying the equalization fee at once. I have discussed this personally with the few groups of farmers, not at great length, but I believe I have gotten an approval of the theory and gotten them to see that this is not a tax. I believe that they are ready to accept it as an opportunity through which and by which they can do something for themselves, and that they will not regard it as a tax. It means that certain educational work will need to be done before that theory is fully accepted. The three-year time provides for that, during which time you will be in session and have an opportunity to get the reaction of the producers themselves and to adjust or regulate it as your own information at that time may indicate.

The CHAIRMAN. You are discussing a subject, Mr. Stealey, that interests me very much. I have been wondering, since this amendment was submitted to me, which I understand comes from the cotton men themselves, postponing for three years the collection of the fee as far as cotton is concerned, just why the cotton men desire that to be done, and why it should be done. Why should we treat cotton differently than we do wheat, for instance? It is a question that is going to be asked, and it is a question that we are going to have to answer. It is well for us to get your ideas just as fully as we can get them on that subject.

Mr. STEALEY. Cotton is a world commodity, with a world price, and the stabilization of the American market will at the same time stabilize the world market, and there will not be the possibility or the likelihood of a loss sustained by the equalization fund in cotton that there probably would be in commodities for which there is an attempt to establish a domestic market and a world market.

The CHAIRMAN. That difference is perfectly clear to me, Mr. Stealey. That difference will still exist when the three-year period is up just the same as it does now. Why do we change the bill so far as cotton is concerned, operate one way for three years, and then take another course after that?

Mr. STEALEY. That suggestion comes about because of advice that we have received in Washington that it would not be possible to get the legislation in the form in which we prefer to have it, and

that this is more nearly a carrying out of platform pledges than the legislation which we proposed, and they have asked that we accept or ask for it in this wise in order to give a two or three year period of discussion in the South for this type of legislation. This type of legislation as contributed by the producers has been discussed by the farmers of the north agricultural belt for two or three years. They are familiar with it. The cotton farmers have not had this theory of administration presented to them at all. It is an entirely new question to them.

Senator HEFLIN. That is the reason you are postponing it for three years in the South?

Mr. STEALEY. I would say so.

Senator RANSDELL. I was going to ask you if you had had any general conferences among the cotton people, producers, merchants, executives of the different States, and bankers of the different States, of financial interests, similar to those who met at the much discussed Des Moines conference, where the corn people and the wheat people got together. Have you had anything of that kind in the South in regard to cotton?

Mr. STEALEY. There have been no mass conferences or conventions of that kind. For the last four weeks I would say this has been seriously considered; that is, the situation or the possibilities of next year have been seriously considered by small groups of supposed leaders in the South. Numerous ones of us have been in conference practically all the time in different places in the South for the last four weeks. From each one of those groups there has come a unanimous, or in one or two cases unanimous except one vote, indorsement of legislation along this line, of legislation, if we could get it, with an equalization fee authorized to take place at once. That has come after weeks, some places, or at least a week of being locked up nearly night and day in a room studying the situation.

The CHAIRMAN. I think we ought to make this plain, if it is true, and I assume that it is from my conferences with the cotton men and so-called livestock men. This amendment offered this morning originates, as I understand it, with the cotton men.

Mr. STEALEY. Yes; we recommend it now.

The CHAIRMAN. And there has been no objection from the people who represent livestock and wheat interests?

Mr. STEALEY. No, sir.

The CHAIRMAN. No objection to putting cotton in on exactly the same terms at some time, and this postponement comes from you people.

Mr. STEALEY. It comes from us.

Senator SACKETT. Who was it you say in Washington indicated that legislation would not pass in the other form?

Mr. STEALEY. Some of our own Representatives from the South. Senator SACKETT. Members of Congress?

Mr. STEALEY. Yes.

Senator HEFLIN. What type of legislation do they think could pass?

Mr. STEALEY. I think it has been the general opinion that legislation along the line of the two parties' platforms of the last campaign could be passed which, if I recall it, is legislation without anything of an appropriation from the Treasury. We do not want that.

We do not want emergency legislation and only emergency legislation. We want permanent legislation, through which eventually the producers may become responsible for the crop they grow by contributions from that crop.

The CHAIRMAN. I think we might just as well speak very plainly about it. I believe it is conceded by the people who have studied the situation and all elements of the situation that it would be impossible to pass this legislation through the present Congress if the Representatives of the so-called Southern States are opposed to the legislation. That means the cotton men. I wanted to have a clear understanding. If there is any such understanding, I want to have it, because we must secure some assistance from those States if we pass this legislation, and we ought to have it clearly understood that this particular amendment applying to cotton originates with the cotton people. They want it in the bill themselves, and the other people, I think it should be understood, who are behind the bill are perfectly willing that the amendment should go in if the cotton men want it, and they are perfectly willing it should stay out if the cotton men want to go in on the same basis as the others. Mr. STEALEY. I think it is true, Senator.

The CHAIRMAN. So that there can be no doubt, if we ever do get this on the floor of the House and Senate, that we will not be met by the opposition from Representatives from the South who will say we are not treating the cotton section of the country the same way as we have the wheat section.

Mr. STEALEY. The reason for that present condition is that this matter has not been discussed or considered in the South as it has in other places.

The CHAIRMAN. So I am told. As I understand it, those who are representing, as near as we can get anybody to represent, the cotton growers of the South are all favorable to it.

Mr. STEALEY. We are.

The CHAIRMAN. You realize you have not had the agitation and discussion that has been going on in the wheat belt and corn belt, so that the sentiment of the producers is not so well crystalized. Mr. STEALEY. That is correct.

Senator HEFLIN. And is it your understanding, then, that with this amendment the Members of Congress from the South will support the bill.

Mr. STEALEY. I am led to believe that is the condition.
The CHAIRMAN. That is what you hope for?

Mr. STEALEY. That is what we hope for.

Senator RANSDELL. You are led to believe that with such an amendment as that there will not be a serious cry of opposition from the Southern States, appealing through their representatives to defeat the legislation because they have not had a chance to consider it, and this gives them three years to consider it.

Mr. STEALEY. I think I can assure you there will not be.
Senator SACKETT. What is the basis of that opposition?
The CHAIRMAN. I do not understand that there is opposition.
Mr. STEALEY. It is not opposition. They have not studied it.
Senator SACKETT. Are they afraid it will be considered a tax?
Mr. STEALEY. Naturally from some sources it would be spoken of

as a tax.

Senator SACKETT. And you think a tax would be unpopular? Mr. STEALEY. If it were a tax pure and simple, I do not know of any taxes that are popular, primarily, and if it were advertised as a tax and accepted as that it would be unpopular; but I think I can assure you that there will not be any considerable opposition from the South to this in this form. I would not say to you that there would not be some opposition if it were something that was going to be passed and operated at once, without their having had time to con-sider it.

The discussion of the legislation two years ago that went on in the rest of the agricultural belt did not reach us, and what did reach us, what was said in our papers, was distinctly unfavorable to it. Even the cooperative papers, our own papers, if we commented at all, we commented in a not favorable light, so that such thoughts as have been generated down there have been thoughts away from any governmental legislation.

Senator SACKETT. Now you have a certain number of cooperatives. in the cotton section.

Mr. STEALEY. Yes, sir.

Senator SACKETT. Their object in these cooperatives is exactly the same as the object of the bill, carrying surpluses of cotton over a period of time until it can be marketed.

Mr. STEALEY. Yes, sir.

Senator SACKETT. And this is a bill for the purpose of getting the Government to carry on cooperative marketing?

Mr. STEALEY. No, sir.

Senator SACKETT. Well, it has the same effect.

Mr. STEALEY. The Government has several times declared it to be its policy to encourage organization of citizenship, its farmers particularly. This simply suggests that since that has been declared as a policy, that in any of these funds that may be accumulated by reason of this fee, if the cooperatives are combined the Government will have that commodity that is owned by this fee sold through the cooperatives. That is the only assistance to the cooperatives, and that is simply saying that the cooperatives will render assistance to the Government rather than that the Government will render assistance to the cooperatives. The cooperatives can not function completely because it does not, and in the natural run of affairs could not represent all of the commodities. It can not get them all operating together voluntarily.

Senator SACKETT. What I wanted to get in my mind was if the cooperative movement became general, so that it was a complete cooperative movement, that would do the very thing this bill seeks to do; it would enable the crop to be held.

Mr. STEALEY. Giving full meaning to your language, yes; if it were complete.

Senator SACKETT. Yes. Now, based on that I would like to ask some other questions. There are other crops besides the cotton that get into the same difficulty of a surplus that has to be carried over from one year to another. This bill applies to cotton only.

Mr. STEALEY. No; it applies to all major crops.

Senator SACKETT. It does, but the problem in wheat is different. from the others. The problem in livestock products is a little differ