better take up something new? This suggestion of yours is new, and I confess my inability so far to understand it. As eloquent as you have been, I do not understand it yet. Would it not be best for us to try to legislate along the lines of these other suggestions?

Senator SMITH. I am not interfering with the other. I am simply adding my contribution to the problem. If the other solves it, well and good, but I am simply offering this as a practical farmer. have been at this thing for 17 years.

Senator RANSDELL. Longer than that, Senator.

I

Senator SMITH. I mean here as a legislator. I have come to the conclusion that the only hope is to make it more profitable inside than outside the organization, because you know and I know that unless we get a practical farm organization, this same thing will be as perennial as it ever has been. Understand here that this principle that I have brought before the committee, in no way do I want it to interfere one way or the other with the bills that have been proposed by these men. I want you to take those and report them out, if you, in your judgment, think they should be reported out. I will cooperate with this committee, but that does not deter me from suggesting to the public at large and to this committee what, in my heart of hearts I believe is a principle that ought to have attention. Senator RANSDELL. Well, that is entirely reasonable and proper. I just wanted to know if you are offering this as a substitute? Senator SMITH. Oh, no.

Senator RANSDELL. Or if you want us to go ahead and try out the other?

Senator SMITH. I want to see if we haven't got some vaccine against the disease that has been rampant since Adam.

The CHAIRMAN. Are there any other questions?

Senator SMITH. I would like to ask the members of the committee, if they feel so disposed, to take this bill and study the provisions of it. We worked it out as carefully as might be. I think sooner or later in these bills-I have tried to study them with such care as I could give it I think that there is perhaps temporary relief suggested in some of them.

The CHAIRMAN. I do not think there are any other witnesses here

now.

Senator SMITH. I will tell you gentlemen that the condition of agriculture demands relief. It may be that we have got to have temporary relief and then work out permanent relief later.

The CHAIRMAN. Shall we consider that the hearings are closed? Senator MAYFIELD. Mr. Chairman, I have a letter here from a prominent gentleman from my State, in which he discusses the agricultural situation and some phases in connection with it that I would like to put in the record, that I would like to read. I think it would be very illuminating to the committee.

The CHAIRMAN. Very well, Senator. Go ahead.

Senator MAYFIELD. This letter, Mr. Chairman, is written by Hon. T. N. Jones, of Tyler, Tex., to Congressman Morgan Sanders, of my State.

Hon. MORGAN SANDERS, Washington, D. C.

DEAR SANDERS: I have read with some care three or more of the bills which have been under consideration by Congress, which, if enacted into law, will not be beneficial to the farmers of the Nation. It is my opinion that those who are

dealing with the farmers' problems overlook the fundamental cause for their depressed financial condition.

1. The overwhelming majority of those engaged in agricultural pursuits are wholly uneducated, and do not know how to protect their rights.

2. Being incapable of protecting their rights, they have been exploited in the primary markets and business circles until the majority of them have lost all hope of ever being anything but slaves, working for just enough to keep body and soul together. One of the results of this condition is that throughout the Southern States they are as dependent on those who have exploited them as any child was ever dependent on its mother for sustenance. They are abject slaves to their creditors and to those who furnish them meat and bread.

3. They can not organize for the purpose of bettering their condition. They have no money with which to pay the organization expenses; and if they were to organize, they are met at every bend in the road by some combination or interest which has arranged to take a considerable slice out of every product of the farms which they cultivate.

I think, Mr. Chairman, I may be permitted to say there that he has reference more to the tenant farmers in the South.

To illustrate; and prove that my statement is true, I call your attention to occurrence which can not and will not be denied. Farmers in one locality in your district have an organization. They desired to buy through their agent the ingredients used in manufacturing fertilizer, and made a contract to so make their purchases. One night, at a late hour, by telephone, the contracts were canceled. Very early the next morning, the agent of one of the large companies called the agent of the farmers' organization and stated that he had learned that those farmers wanted to buy fertilizer, quoting prices which were exactly the same as those which were being quoted by the fertilizer companies' local agent, which included the very per cent the farmers were endeavoring to save. In short, the fertilizer companies are so organized that they compel the farmers to pay a per cent to those who are engaged in local commercial pursuits.

A farmers' organization assembled $1,000 in cash and went to a wholesale grocery house to buy that amount of groceries. They were told that the wholesale grocery company could not sell the bill, but that they must go to a retail grocer and pay his price, thus depriving the farmers of the privilege of saving the difference between the wholesale and retail price of groceries. The cottonseed-oil companies in this country have a system of contracting with the ginners to buy seed for them. They pay the ginner as high as $6 per ton for buying and delivering the seed. If the farmers haul the seed to the oil mill, they get exactly the same price which the oil mill company is paying at the gin. The farmer can not get the $6 which the ginner receives above the price he, the ginner, is paying the farmer for the seed.

In short, every branch of commercial activities in this country is organized to force the producer to pay profits to every man who handles the products from the second it leaves the manufacturer until it is delivered to the truck for the final consumer. The law as it is now written protects all of the commercial interests in their combination to force the payment of the profits. The farmers have the right to engage in collective buying, but they are denied the privilege of exercising that right because there is no law which will compel those engaged in commercial pursuits to allow them to exercise and use that right.

The Democratic Party, in its national platform in 1922, said:

"We favor such legislation as will confirm to the primary producers of the nation the right of collective bargaining and the right of cooperative handling and marketing the products of the workshop and the farm, and such legislation as will facilitate the exportation of our farm products."

The Republican platform edged up to this question but did not declare specifically for legislation to guarantee to the farmers the privilege of exercising their right of collective buying and collective selling; but President Harding, while on a tour of the West, specifically advocated the policy of collective buying and selling among the farmers.

If Congress will pass a law compelling those who are engaged in interstate commerce and those who handle articles of interstate commerce, to sell to the agent of 50 or more persons, for cash, at as low a price as they sell to any other customer, it would not be one year until permanent farm organizations would be found all over the Nation. There would then be some financial benefit in farm organizations, some powerful motive for them to stick.

4. The farmers all over the South are paying from 10 to 40 per cent for the money which they use for production purposes.

We from the South know that that is true in a great many instances. Some branch of the Department of Agriculture recently gave out a statement that the cattle industry had been bankrupted by high interstate rates. Those who may be termed "dirt farmers" are paying more than double the interest rates of thos who are the cattle raisers. No business on earth can live and pay over 6 per cent interest per annum.

Some Congressmen or Senators insisted that the Federal intermediate credit banking system could answer the demands of the farmers. For general agricultural purposes, it is not worth a tinker for the general farming classes.

I have read two or three times the Aswell bill, which, as I am informed, is favored by one of the most distinguished private citizens in this country.

He has reference there to Mr. Yoakum.

He knows farm life from the plow handles to its world problems. He was born and reared in the rural districts around Larissa, in Cherokee County, this State, and ascended to great influence in railroad development throughout this Southwest. I have known him since 1880. His judgment and opinion are entitled to great respect; but I am inclined to the view that the plan which is embodied in the Aswell bill, which I understand he favors, will fail, for the reason that the Interstate Farm Marketing Association provided for in the bill will, in a short time, be controlled by the very influences which now have the agricultural interests of this country by the throat with a strangle grasp. The Congressional Records and the committee investigations show that at least one of the organizations which is to select five of the incorporators is already the pet of the special interests. It was not born in a manger, but in a chamber of commerce at some place in the State of New York, and it has never drifted away from the surroundings of its birthplace.

The CHAIRMAN. Does he state what that organization is?
Senator MAYFIELD. Wait a minute, Senator.

Another which is to name five of the incorporators had at one time a large following and membership in Texas. The southwestern branch of its body withered and died and rotted off, because that limb was punctured with so many holes from the needles cocained by the special interests. I know little about the other two; but if you will make careful inquiry, you will find that no other one of the four organizations named in the bill has any substantial organization in the South, unless it is the Farm Bureau Federation, which is the one referred to above as the pet of the chambers of commerce.

This Aswell bill gives to the 13 incorporators, representatives of four so-called farm organizations, on page 7 section 6, the exclusive discretionary power to utilize other farm organizations; but it does not anywhere provide that any other farm organization shall have a seat around the table. All others must feed in the stable.

Congress is spending a very large amount of money in agricultural work. Among its expenditures is the amount paid in salaries to county agents and home demonstration agents. Such agents are utterly worthless so far as their service to the farmers is concerned, because they are completely under the domination and influence of those chambers of commerce and commercial interests which are now and have been for 60 years exploiting the farmers. Those agents should be instructed to get away from the commercial activities of the primary markets and teach the farmers what and how to do those things which will change their financial condition. Of course, I know that all such agencies are handled through the agriculture and mechanical colleges in cooperation with the Department of Agriculture at Washington; but the agriculture and mechanical colleges, with one or two exceptions, are controlled by those interests which are responsible for the present condition of agriculture.

But I must close this already too long communication by two observations. One is that Congress has a great undertaking on its hands when it attempts to solve the problems of the farmers of this Nation. The other is that, in my judgment, there are those in and around Washington who are giving advice ostensibly as the representatives of farmers, but in fact feel most kindly toward existing conditions, and do not desire to disturb those conditions.

Since writing the above I have read in the Congressional Record of March 29, in which is the speech of Senator Norris and the correspondence which passed between Aaron Sapiro and Walton Peteet. An analysis of the proceedings in the Senate on that day and of the correspondence between those gentlemen,

taken in connection with my personal knowledge of some of the men whose names are connected with it, is sufficient to satisfy me that instead of desiring anything done so far as the farmers are concerned, the Farm Bureau Federation is anxious to defeat any kind of effective legislation. During the past three or four years I have had occasion to become acquainted with its methods in this State. The cooperative associations, which are referred to in the correspondence as constituting a National Council of Cooperative Marketing Associations, with an office at 1133 Investment Building, Washington, D. C., are the concerns which are under the domination and control of Aaron Sapiro and his group of organizers. It may be of interest to you to know that the men who are connected with the Farm Bureau Federation in their cotton associations and other concerns are receiving higher salaries than any officials of the Government except the PresiIdent of the United States. One year that concern, which had its headquarters at Dallas, paid the man who handled its cotton as its marketing agent $50,000. Someone started a controversy about it and they reduced it to $33,333.33 the next year. Peteet, Moser, Carl Williams, and others, and their associates, in my judgment, are receiving higher salaries than the judges of the Supreme Court, Congressmen, or Senators. In addition to this they are allowed enormous expense accounts, all of which is being and has been dug out of the farmers whom they have induced by misrepresentations to sign their contracts for five years, by and through which contracts they are compelled under the decisions of the Supreme Court of this State, and probably of other States, to deliver the cotton whether the farmers desire to deliver it or not.

The Farm Bureau Federation and the concerns which it has organized are nothing but corporations, out of which the men whose names appear in the Congressional Record of the 29th instant are making enormous salaries. You may be familiar with the contracts which they prepared and had signed by cotton growers in Texas and which the Supreme Court of this State sustained as being absolutely binding. There has never been perpetrated on the farmers of thi State a greater outrage than when the agricultural and mechanical college' through its extension service, together with Sapiro and others, induced the legislature to pass a law under which the contracts were made so binding. far as the membership is concerned, there has not been any kind of misrepresentation which their agents will not make in order to induce a farmer to sign the contracts to market his cotton through their cotton association. They employ a lot of irresponsible men to go out among the farmers in the fields, and pay those agents so much-I think, $4 apiece for every contract such agent gets signed.

So

In this county, they had agents traveling around over the county, going into the fields where the farmers were cultivating the cotton, making their spiels about the benefit of the cotton association; and every time one of the fools signed a contract, the cotton association paid the agent $4. I know about this because of the fact that I represented one of their agents in collecting from the cotton association one of the accounts. I accepted the matter solely for the purpose of finding out exactly their system. Now, these men are at Washington undertaking to tell Congress what ought and ought not to be done in the interest of the farmers of this country; and I judge from the Congressional Record and the speeches that are made, in which they are high complimented, that they are regarded as having very great influence and are entitled to great consideration in the determination of what should be done.

So far as Sapiro is concerned, it is my judgment that the sole interest he has in this whole matter is the enormous salary he is receiving from the different associations which have been organized.

There is a remarkable thing about the Farm Bureau Federation. Every special interest in the South has commended and petted it since it first started, and the same interests have fought industriously every farm organization which has endeavored to aid the farmers in solving their problems. I would not make these statements but for the fact that I have been following the course of that concern since it first started in Texas, and I read in the Congressional Record of JanuaryFebruary, 1922, a discussion of its operations, and also read the investigation which was made by Congress.

You may use this letter for any purpose you may desire.

Senator HEFLIN. Signed by whom?

Senator MAYFIELD. Signed by T. N. Jones, of Tyler, Tex. I stated that before I read the letter.

Senator GOODING. What is he? A lawyer?

Senator MAYFIELD. Yes, sir. He is a lawyer of Smith County, Tex., and he has taken a great interest for the last 14 or 20 years in assisting in farm organizations.

Senator RANSDELL. Is he a thoroughly reliable and reputable man, Senator?

Senator MAYFIELD. Yes, sir.

Senator HELFIN. He is very artistic and picturesque in his description of these various farm organizations.

Senator MAYFIELD. I read the letter principally, Mr. Chairman, to direct your attention to his suggestions with reference to legislation. I did not feel that I ought to read part of the letter without reading it all.

The CHAIRMAN. The only suggestion he has for legislation is that there ought to be a law compelling people dealing in interstate commerce to sell to everybody alike.

Senator MAYFIELD. To sell to the agents of farm organizations.
The CHAIRMAN. Yes; to anybody, I take it.

Senator MAYFIELD. No. He says to a group of 50 or above.
The CHAIRMAN. Well, any group of 50.

Senator MAYFIELD. But not to individuals.

Senator HEFLIN. Well, I think if a group of 50 make up a purse to go to a wholesale establishment to buy goods, they should have a right to buy those goods, and if the merchant refused to sell those goods and they had the cash and offered it, it is a matter for the State legislatures. I think there ought to be some action on that.

The CHAIRMAN. Well, we could pass a law, as far as interstate commerce is concerned, that would be perfectly constitutional. It has always seemed to me as though we ought to do it. However, that is not the question that is before us now.

The CHAIRMAN. It is understood that the hearings will be closed on Monday, and we will adjourn now until Monday at 10 o'clock. (Whereupon, at 11.50 o'clock a. m., the committee adjourned until Monday, April 12, 1926, at 10 o'clock a. m.).