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In other words, have we been able to get for wheat on the other side of the water less money

year per

bushel ? Mr. PEEK. Perhaps I can answer your question by giving you the exact figures.

Senator SACKETT. Yes.

Mr. PEEK. From 1870 to 1880 our average net exports were in round figures, 85,000,000 bushels, and the farm price 99.4. From 1880 to 1890 our exports were 126,000,000 bushels, and the farm price was 83.4. From 1890 to 1899, our exports were 171,000,000 bushels and the farm price was 65.1. From 1900 to 1910 our exports were 15,000,000 bushels and our farm price was 76.7. From 1910 to 1914 our exports were 152,000,000 bushels, and the farm price 86 cents, Then we come into the war period, 1915 to 1920, when our exports were 209,000,000 bushels and our farm price $1.693; 1921 to 1923, inclusive, 208,000,000 bushels, almost up to the war period, with a farm price of 95.2, which is the highest farm price received since the period 1870 to 1880, except the war years, with very large exports. But the exchange value, according to the National Industrial Conference Board, was approximately half what it was in 1914.

Senator SACKETT. How has it been going since 1923? Have you any information on that?

Mr. PEEK. I think 1924 could be included in that same figure, I will get you any of those figures you want, Senator, so far as they are obtainable.

Senator SACKETT. Iwas just interested to know whether the surplus abroad was selling for less actual money now than it was right after the war.

Mr. PEEK. This year we have been getting some of the benefits of the tariff on wheat, because we had a short crop in this country, and practically no surplus. That is a very excellent example of how this bill would work, by getting the surplus out of the way.

The CHAIRMAN. What was our surplus this year?

Mr. PEEK. We had, roughly, 650,000,000 bushels of wheat this year, and we consume around 600,000,000. But, of course, 650,000,000 bushels means that in many localities there was an actual shortage.

At this or any other time, Senator, I will be very glad to have prepared any statistical figures that you want for consideration of this subject. It is always a little hard to tell just what questions you are going to be asked.

The CHAIRMAN. I think I understand it, but, so that the record may show it, your organization, which I designate as a business men's organization, of which you are chairman, and the farmers' organization, which had the big meeting culminating at Des Moines, Iowa, are together on this committee print.

Mr. PEEK. Yes, Senator, but let me explain that the committee of 22, two from each of the 11 States, are directly or indirectly the appointees of the governors of those 11 States, and you know as well as I do, or better than I do, to what extent representative government represents the people. In other words, I do not want to profess to represent anyone I do not represent. I want to make it clear

The CHAIRMAN. I do not think you understand my question. I want to have it appear to what extent these two committees, representing, as it were, two divergent interests, you might say, are in

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harmony now in asking for legislation, and if they agree upon this bill that is now before us, known as the committee print.

Mr. PEEK. We do agree, Senator, entirely.

The CHAIRMAN. Since these two committees have been here, you have been conferring with the cotton men.

Mr. PEEK. Yes.

The CHAIRMAN. And with the amendment that is now included, you have all agreed on the same bill.

Mr. PEEK. Yes.

The CHAIRMAN. That is what I want to get at. I do not know of anything else I wanted to ask.

Senator SACKETT. I do not think of anything further.

The CHAIRMAN. So far as I know this closes the hearing of those who favor the bill. There is at least one who wants to oppose it. He will be here to-morrow. The Agricultural Department has been invited. I do not know what it will do, but it has been invited to send some one here. It will be represented here to-morrow.

Mr. PEEK. I think the southern group will present a summing up of an explanation of the legislation to-morrow, which will be formally approved by the other organizations for the record.

The CHAIRMAN. I have tried to arrange it so that we can finish Wednesday. So far as I know there is no one to be heard except those I have mentioned.

We will adjourn until 10.30 to-morrow.

(Whereupon, at 12 o'clock noon, the committee adjourned until to-morrow, Wednesday, April 7, 1926, at 10.30 o'clock a. m.)




Washington, D. C. The committee met, pursuant to adjournment, in room 326, Senate Office Building, at 10.30 o'clock à. m., Senator George W. Norris presiding

Present: Senators Norris (chairman), Capper, Gooding, Norbeck, Sackett, Heflin, and Ferris.



The CHAIRMAN. You may proceed, Mr. Stealey.

Mr. STEALEY. I am appearing again to present an explanation of the proposed legislation that we are advocating.

Mr. Chairman and members of the Committee on Agriculture and Forestry, this bill has been prepared by the executive committee of the American Cotton Growers Exchange, after conference with leaders of numerous farm organizations representing corn, wheat, and livestock, who furnished the information and approved the plans covering these commodities. It uses the Dickinson bill as a framework and weaves into it the practical experience gained during the last five years by the cotton cooperative associations of the 12 principal cotton growing States handling over a million bales of cotton annually, and maintaining sales offices in all the principal domestic and foreign markets.

Assuming that party platforms and pledges are to be redeemed by a sincere attempt to help solve the difficult farm problem, through the medium of cooperative marketing associations and by encouraging their organization and fostering their growth, this bill offers practical means for attaining that end. It provides for the immediate use of the marketing machinery of cooperatives having a going business organization and allows time for the building up of others in localities and products not at present so organized.

It provides for aid from the Federal Treasury during this formative period through a revolving fund, but under its provisions each product will carry the cost of its own stabilization and disposition, after a short period during which the farm population adjusts itself to the ideas and practical working of the law.

The following extracts from party platforms have been kept in mind in the drafting of this bill.

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The Democratic platform adopted at the New York convention on June 29, 1924, pledged the party supportto stimulate by every proper governmental activity the progress of the cooperative marketing movement, and the establishment of an export corporation or commission in order that the exportable surplus may not establish the price of the

whole crop.

The Republican platform adopted at the Cleveland convention on June 12, 1924, said:

We favor, without putting the Government into business, the establishment of a Federal system of organization for cooperative marketing of farm products.

The Republican Party pledges itself to the development and enactment of measures which will place the agricultural interests of America on a basis of economic equality with other industry to insure its prosperity and success.

This measure creates a board, so chosen as to make it always representative of agriculture. It provides for equalization funds for the five principal American cash crops to be raised ultimately by an equalization fee collected from each commodity group. These funds are to be used to promote price stabilization and to make the tariff otherwise provided for effective upon the domestic price of such commodities as are dutiable.

The object of the proposed legislation is to secure a greater degree of stability in the price levels of the principal cash crops. It is proposed to do this by placing at the disposal of the producers a mechanism with the assistance of which they can control the handling and marketing of crop surpluses, thereby preventing violent price fluctuations, and securing in domestic markets the price benefits of the import duties.

Specific advantages to be derived from the operation of the plan embodied in this bill are:

It will secure a protected price to the producer of crops like wheat, of which a relatively small surplus enters world trade.

It will afford all the advantages of orderly marketing through control of surplus to the producer of a crop like cotton, of which the American supply is the dominant factor in the world price.

It will enable producers of meat animals to maintain a stable level of hog and cattle population, by steadying prices and by promoting carry-over of corn from years of high production to years when the yield is low.

It will promote cooperative associations by making it possible for them to control the movement to market of temporarily unneeded quantities of a commodity, without imposing on their members alone the entire burden of withholding, removing, and disposing of them.

Variation of yield due to weather and other natural factors makes it impossible for farmers to control volume of production by regulating acreage.

The task of managing supply not immediately required must be borne by each agricultural commodity group as a whole if violent and destructive price fluctuations are to be avoided. If for each commodity group a fund is provided to be used for withholding them to the best advantage a greater degree of stability in agriculture can be secured which will be helpful to the farmer, the processor of his crop, and to the consumer.

That the American farmer should be enabled to do this is the central principle of this bill. For a start, the five principal cash


crops are selected-cotton, wheat, corn, hogs, and cattle. The bill refers to these five as “basic agricultural commodities.” The word "basic" is used purely as a definition for the purposes of the bill and its use does not imply that other commodities are less important to agriculture. An equalization charge calculated by and collected under the direction of the Federal Farm Board is to provide an equalization or stabilization fund for each of the commodities named. Such funds will be available, under the board's direction, to finance dealing with the surplus.

This equalization charge upon the product, it is provided, will be collected at the most practicable point between the producer and the consumer as may be determined by the board. The problem of an increasing production might be met by an increase in the size of the equalization fee in much the same way as inflation is checked by the Federal Reserve Board through control of the rediscount rate.

Action by the board with any one of these basic commodities can be taken only when the board finds that there is or may be a surplus above requirements for orderly marketing and that a substantial number of associations of producers of such commodity are in favor of operation in respect to it.

The crops chosen for initial action--cotton, wheat, corn, hogs, and cattle—are the principal cash crops of American agriculture. Each finds its way to market through points at which the equalization charge can be conveniently collected.

In addition the board is directed to study the surplus problems of other farm commodities. When it is of the opinion that it is desirable and practicable to include another commodity in the same class for treatment as the five above mentioned, it is required to report its findings to Congress with recommendations for amendment to this act.

It is obvious that the board can operate to advantage immediately on only a few principal commodities. Congress meets annually. It can add to or amend this or any other law. Every far-reaching Federal act has been subjected to amendment and change. The Federal Reserve act may be cited as illustrative. It was approved in December, 1913. Since that date Congress has enacted 16 separate laws amending the original measure and making changes in 39 sections. The space taken up by additions caused by amendments to the Federal reserve act is only slightly less than the space occupied by the entire original act itself.

The board itself is a part of the Department of Agriculture. It is composed of one member from each of the 12 Federal land bank districts and the Secretary of Agriculture. To insure a board which directly and properly represents the farmers, the following method of selection is provided; a Federal farm advisory council composed of 5 men each of the 12 Federal land bank districts is created. One member from each district is appointed by the Secretary of Agriculture. Four members of the council are chosen at conventions of cooperative associations and farm organizations within each district. Arrangements for such conventions, including designation of organizations eligible to participate, basis of representation, date, etc., are to be made by the Secretary of Agriculture with the advice and assistance of representatives of farm organizations and cooperative marketing associations.

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