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to the operation of the plan embodied in this bill. We are not in favor of legislation which does not give the farm board power and funds to stabilize prices by managing the surplus, assessing the cost upon • the industry benefited.
This statement I respectfully submit in behalf of the American Cotton Growers Exchange and B. W. Kilgore, C. L. Stealey, U. B. Blalock, and C. O. Moser, who are members of the legislative committee.
STATEMENT OF BENJAMIN C. MARSH, DIRECTOR OF THE
FARMERS' NATIONAL COUNCIL, WASHINGTON, D. C.
The CHAIRMAN. We will hear from you now, Mr. Marsh.
Mr. MARSH. I understand that I am to discuss the several measures before the committee and also the whole question of farm relief. I want to say that I regret that I can not see much hope for agriculture in any of the bills pending. There are two ways of dealing with the agricultural problem. Senator Brookhart in this week's Nation has an article entitled "The plight of the farmer, from which I would like to read a very short excerpt. He said:
The farmers are entitled to a system of laws that will raise agriculture to the same artificial level as all these other great industries. The only alternative would be to wipe out the laws that have given these discriminations. We have lived on this artificial basis under laws so long that to wipe them out would, I think, mean universal disaster, and I think nobody in America would seriously advocate such a proposition. Of course I can not
agree with that statement. It is quite obvious. that if the special privileges which now exist are to maintain their special privileges, they will have to do so by having the artificial level. If agriculture is raised to the same level, then there is no real artificial level for any of them. The only hope for the farmer is to wipe out the special privilege. We frankly admit you have to do that. So long as you have the present control of the credit, the present tariff system, the present land system, and the control of transportation, agriculture is doomed.
I propose to discuss some of the bills, but other subjects are very much more important as to helping agriculture. Last year you had before you the McNary-Haugen bill
. One of the chief advocates of that bill was Mr. Ralph
Merritt, whom you remember, of the Raisin Growers' Association. What has he done? He went home and bought. several hundred acres, three or four hundred acres of land to raise raisins or grapes, and promptly chopped down some 60 per cent as an illustration or example to the farmers of what they would have to do.
In the legislation pending we are proceeding upon the theory that the farmer can compete in foreign countries and that we are going to raise the price. We have been through a lot of this experience. One of the most valuable documents on this subject is the Dictionary of Tariff Information, put out by the United States Tariff Commission in 1924. I would like to go back a little over a century, because all of these problems are as old as history. I was going to say as old as civilization, but we have not had any yet. I would like to read a brief section from this Dictionary of Tariff Information.
Senator GOODING. Did you say we have no civilization yet?
Mr. Marsh. You would not regard it as any where the farmers are in the condition in which they are to-day, would you?
Senator GOODING. You mean civilization for the farmers. You mean there is civilization for the industries, but none for the farmers ?
Mr. MARSH. I would leave it to any member of the committee to put his own interpretation on that.
Here is what the Tariff Commission has to say with reference to conditions and experiments with wheat in England:
With the end of the great wars imports from Prussia and Poland lowered the price 50 per cent. At the demand of the landed interests in 1915 the import of foreign wheat was prohibited so long as the domestic price did not exceed 18 shillings a quarter ($2.36 per United States bushel). Landlords received high rents as a result, but farmers who leased their lands did not profit, and consumers were forced to pay excessive prices. The working classes were brought to the verge of starvation in 1817, when the value of wheat rose to about $3.50 per bushel. The injustice of this system was recognized even among those who profited thereby, and Canning demanded the repeal of the corn law. In 1820 numerous riots and sanguinary repression aroused the people.
Senator GOODING. This is a statement by the Tariff Commission?
Mr. MARSH. Yes; under its present control, with one or two exceptions. Of course, you know they are investigating the Tariff Commission. We drafted the resolution for that investigation and were pleased when the Senate adopted it. No one did more to get it adopted than did the chairman of this committee with his speeches on the subject of the Tariff Commission.
Any attempt at arbitrary price fixing is very apt to have that result. We might as well face the situation. I have read a great deal of the testimony taken before the Senate and House Committees on Agriculture on pending bills and know a good many of the speakers. It is all right to say that you have to make a prosperous agriculture, but let us see what is happening: I wish every member of the committee could read this report of the United States Department of Agriculture from the Yearbook of 1923, Separate 896, on “The
" utilization of our lands for crops, pasture, and forests.'
That report makes it perfectly clear that you have before you and the country has before it a very much more serious problem than getting a certain price for a certain crop here or there. We have extended our farm plant until it is more largely overplanted than any other industry in the United States. We could produce practically twice as much as we do now on the farms of most crops with a reasonable degree of efficiency. Secretary Wallace, with whom I disagreed often, I think was quite correct when he said:
The practice of encouraging farmers to keep on in the face of impossible odds, so they continue to make payments for a time only to be forced out when mortgages can be profitably foreclosed, must be disapproved.
I want to call your attention to what has been happening. In 1910, 33.3 per cent of the population 10 years of age and over engaged in gainful occupations was engaged in agriculture. By 1920 that had fallen to 26 and a fraction per cent. It is probably down now to 22 or 23 per cent, and it is going down more and more, because what is known as the agricultural revolution is taking place. It was inevitable. There are something like 700,000 tractors in use on farms, and they are increasingly using electricity. I could read a lot of figures from reports of Secretaries of Agriculture and other Government reports showing that we have probably from 500,000 to 1,000,000 too many competing farm units in America to-day. We are going to be an industrial nation. Any so-called farm-relief legislation that does not recognize that is simply getting the farmers into the hole worse than ever.
You may recall that President Coolidge, in his address December, 1924, to the meeting of the Association of Land Colleges, made the statement that we should shortly be an agricultural deficit-producing nation. I think that was putting it too strongly, because I think it will be quite a few years before any effort to put America, with its present farm land values, into the world as an agricultural exporting nation, with the exception of cotton, is going to be successful.
Senator GOODING. You do not advocate the scrapping of agriculture, do you?
Mr. Marsh. I do not advocate it. I admit it is happening. I am going to face the situation. Very frankly, what is happening in this country? The farmers say they are very poor. From 1900 to 1910 the increase in the selling price of farm lands was 118 per cent, an average of nearly 12 per cent a year. From 1910 to 1920 the increase in the selling price of farm land was 92 per cent. From 1920 to 1925, according to the report just made by the Census Bureau, the selling price of farm lands dropped 31 per cent, a reduction of $17,050,000,000, and it is too high now.
Let me give à concrete illustration. I worked a good part of my way through academy and college on a farm in the central part of Iowa. I started to work on the farm when I was 15 years old, during my summer vacations. It was a nice farm. There was a man who owned about 1,300 acres, and we raised most of the small grains. I remember one cornfield I plowed in which the line was 1/4 miles long. I had a tongueless cultivator and two ornery mules, and I will never forget it. That land was selling then
The CHAIRMAN. I am very much surprised that you could not get along with the mules.
Mr. MARSH. I could, but they could not get along with me.
Senator GOODING. I read a story in my home paper this morning about an Iowa mule, that I would like to tell you if I had the time.
The CHAIRMAN. No man can handle mules and handle them right unless he is able to swear without stuttering.
Mr. MARSH. I am a preacher's son.
Mr. MARSH. I remember that the farmer, when I was pushing them through one real hot afternoon, said to me, “Doggone you, are you trying to kill those mules?”
That land was purchased in the central part of Iowa for about $25 or $30 an acre. Of course he raised his supply of hay. He had between 250 and 300 head of cattle and a hundred head of horses. I stopped last August in my college town of Grinnell, coming back from a trip to the West, and there I found an appalling state of affairs. Every bank but one in that town was busted. Why? Because they had jockeyed and speculated the selling price of farm lands all around there up to $250 or $300 an acre or perhaps a little more and overloaned. The selling price of farm lands in Iowa in the
last five years has dropped by $2,700,000,000, and is $1,000,000,000 too high even yet.
Senator NORBECK. It is worth less than half now what it was six years ago.
Mr. MARSH. I spoke of the selling price and I would not agree it was even worth that. The farmers can not be land speculators and at the same time ask Congress to protect them as land speculators.
Senator NORBECK. But if the land had gone down to less than half the value, they are hardly speculators at this stage, are they?
Mr. MARSH. They certainly are just as anxious to be speculators again as possible.
Senator NORBECK. Are they any more so than holders of city property?
Mr. MARSH. A great many States have exempted improvements. I am glad the Senator asked that question. When he was the governor of his State he had good sense enough to have a law passed in South Dakota to exempt improvements to the extent of $500. It would have been better if he had exempted all improvements.
Senator NORBECK. But they did not like it. Å subsequent legislature repealed the law, and it was a farmers' legislature at that.
Mr. MARSH. Then they have no business to come to Congress and ask for a subsidy for the land speculators.
Senator GOODING. Let us come back to the question of the farm speculator. The farmer himself was not a speculator.
Mr. MARSH. I mean whoever speculated in the lands.
Senator GOODING. There are a few farmers who deal in real estate in my town. We have them in every town, but not 2 per cent of the farmers are speculators, so it should not be charged that the farmer is a speculator. I think that is an unkind thrust at the farmer.
Mr. MARSH. I am merely saying those who speculate in land, and quite obviously the tenants are not speculators. That is, the report of the Tariff Commission points out any such legislation as proposed under the existing tax laws is going to help the landowner, and it is going to be a very great detriment to the tenant farmer and the small farm owner.
The CHAIRMAN. Not necessarily now, but some time before you finish-and we would like to get through by 12 o'clock, because I think this will probably end the hearings—we would like to hear about whatever remedy you want to suggest. We are not so much interested in having you tell the condition of the farmer now, because that has been told so often to us that I think we understand it pretty well. We are interested in trying to get a remedy. If you do not think anything is a good remedy that we have now before us, we would like to hear about any remedy you may have to suggest.
Mr. MARSH. My study of the testimony did not indicate any reference to the farmer as a land speculator, and that is one of the chief troubles with him, and we might as well face it.
As to the pending bills, let me take them up in detail..
The CHAIRMAN. I think the members of the committee have pretty nearly concentrated on this so-called farmers' bill. You can take others if you want to, but we would like to have you take up that particular one and analyze it. I refer to the so-called confidential print.
Mr. MARSH. There are two or three things I want to discuss. I suppose it is an effort to protect the farmers from protection, an effort which very seriously needs to be made by this Congress, because a tariff on farm products is always a joker for the farmers. Let me read from the Department of Commerce the percentage of farm products exported in years past. The proportion of exports of lard and other meat products in 1922 was 8.1 per cent; in 1923, 9.3 per cent; in 1924, 8 per cent. Of wheat, the proportion exported in 1922 was 34.3 per cent, in 1923 was 25.6 per cent, and in 1924 was 19.6 per cent, and, of course, it dropped last year to a negligible amount. Of cotton, in 1922 the exports were 82.2 per cent, in 1923 were 51.9 per cent, and in 1924 were 56.5 per cent. Of tobacco, the figures, respectively, were 42.2 per cent, 35.7 per cent, and 36.8 per cent.
This bill is an effort, and I know is a sincere effort, to try to enable farmers to dump their surplus abroad at the least possible loss. The gentlemen who have been before you tell you there will be a surplus, and that is the problem; that if you reduce the surplus the farmers will be sensible and try not to produce so much, and they have come and told you of the large surplus produced by the farmers has been the cause which has led them to produce more. In other words, they contradict themselves. If the farmer has not learned anything from going busted from year to year, you will not teach him anything by any of these measures. They are perfectly futile, and we might as well admit it. If I were a meat packer or if I were Senator Butler of Massachusetts, or if I were the grain exporters, I would be for the bill. It is a grand subsidy for Senator Butler and his son, Morgan Butler, who is president of the American Cotton Manufacturers' Association and the meat packers. The bill provides that they can export the processed product, take the loss, and assess it back upon the farmer.
Let me give you an illustration. I was told last year and the year before, when I was campaigning up in the Northwest, that I would not dare talk about the McNary-Haugen bill. I just read the bill and asked if those farmers knew what it meant. I said how many of those farmers know that there is a stipulation that, without auditing the books of the cotton manufacturers and of the packers and of the exporters of wheat and flour, permits those gentlemen to say, without having their books audited, “We lost $20,000,000 or $40,000,000 or $100,000,000,” and have it paid by assessment on the producers. No farmer indorsed that. They propose that every producer shall be happy and prosperous, but how are they going to accomplish it? They propose to assess the losses claimed upon exports in the processed form upon the producers, which of course would mean that the Massachusetts mills could run about 14 hours a day because they could get this wonderful bonus out of the cotton growers. I believe that any Congress that passed the Mellon tax reduction plan is not going to pass any bill that will give relief to the farmer, because they would have to reverse themselves so completely.
These are minor criticisms. Of course you never can collect this assessment and equalization fee. I should think if a Republican voted for it, it would be because he expected the Democrats to carry the next election, because of the opposition which is bound to arise to a system like this.