PROGRAM OF NATIONAL FARM ORGANIZATIONS TUESDAY, JANUARY 12, 1932 HOUSE OF REPRESENTATIVES, (The committee this day met at 10 o'clock a. m., Hon. Marvin Jones, chairman, presiding.) The CHAIRMAN. The committee will come to order, please. This meeting was called at the suggestion of representatives of various farm organizations for the purpose of giving them an opportunity to outline to the committee some features of a program that they advised they had agreed upon and desire to present to the committee so that it may be considered by the committee. They expect to ask, at a later date, for a hearing on these various problems, but if I understand their suggestion aright, they simply want to get before the committee this morning, as heads of the three great farm organizations, the tentative program in which they are interested, and in order to extend this courtesy to them I took the liberty of calling the committee together. The hearing this morning will simply be in the nature of getting before the committee some features of the program agreed upon by these organizations, and we will not endeavor to go into the details of these various plans at this time. Three witnesses are appearing, Mr. O'Neal, president of the American Farm Bureau Federation, Mr. Simpson, head of the National Farmers Union, and Mr. Taber, master of the National Grange. Mr. O'Neal states that he has an appointment a little later and we will hear from him first. Mr. PURNELL. I have to go to the Rules Committee meeting in a few minutes, Mr. Chairman. The notice which was sent out said the hearing would be on the wheat matter. Will that be taken up this morning? The CHAIRMAN. It is not the intention of the committee to take that up in the hearing this morning at all. Perhaps I did not make myself clear to the clerk. That is not involved in this hearing. Mr. PURNELL. When we are to have a hearing on that measure I desire to be present. The CHAIRMAN. As stated at the outset, the hearing is called at the suggestion of representatives of the various farm organizations to give them an opportunity to outline to the committee some features of their program. There are two or three others who have asked to be heard on that subject, Mr. Norton, when it is taken up, and in view of matters of tremendous importance now pending in 1 the House, matters of far greater interest than even that measure. I thought it better to have all of the members of the committee left free during the consideration of those measures in the House. Mr. KETCHAM. My colleague, Mr. Clancy, has prepared a statement directly relating to this wheat bill, in which he has gone quite at length in setting forth his reasons for the legislation I believe, and with the permission of the committee, I would like to have the statement, which he has prepared, inserted in the hearing. The CHAIRMAN. I would like to suggest that it be inserted in connection with the other hearing. Mr. KETCHAM. The other hearings? The CHAIRMAN. Yes. Mr. KETCHAM. The only difficulty is that the statement should be printed in the hearing. The CHAIRMAN. The other hearings have not been printed and if it is given to the clerk it can be printed in connection with those hearings. Mr. LARSON. Mr. Chairman, I desire to call attention to a bill which I introduced several days ago, relating to a subject for which I understand the Agricultural Department is asking legislative enactment. Those of us who come from the section of the country where I do realize that if seed loan legislation is to be of any aid at all, so far as the southeast section is concerned, the legislation should be enacted at an early date; if the farmers of the southeast are to receive any help from it for making their crops, it must come at once. I would like for the chairman to indicate when hearings may be had on such bills. The CHAIRMAN. I will state to the gentleman, that the Chair has had that matter up with Doctor Warburton and has endeavored to work out something; and at the same time has had up with the Appropriations Committee the question of reappropriating the_unexpended balance of the previous appropriation. Both of those matters are now pending, and there is also a measure that has been tied on in the Senate to the reconstruction bill which would cover practically the same thing, that bill practically revives the War Finance Corporation with enlarged powers, and the Senate yesterday adopted an amendment to it. Mr. ANDRESON. We are vitally interested in the northwest in Minnesota, North Dakota, South Dakota, and Montana, and I would like to urge that the committee hold early hearings on these measures, because we have got to act on them quickly if they are to furnish the relief sought. The CHAIRMAN. I will state to the gentleman that hearings on these matters when the time arrives, the chairman will call meetings for their consideration. Mr. LARSEN. May I ask if it is not a fact that it will be some time before the War Finance Corporation bill, or whatever you shall call it, is put through; after it is put through, will the administration of the law be such that we can expect early relief from it? The CHAIRMAN. This particular amendment does not wait the action of the board of directors to authorize action; it directs the Secretary of Agriculture to handle the matter along very similar lines. Now, this meeting was called for the purpose of hearing these gentlemen, and we will now hear from Mr. O'Ñeal. For the benefit of some of you gentlemen who have come in since the committee was called to order, I will state that this hearing was called at the suggestion of the heads of three of the great farm organizations of America to give them opportunity to present to the committee an agreed program which they wish to lay before the committee. We will hear Mr. O'Neal first. STATEMENT OF EDWARD A. O'NEAL, PRESIDENT AMERICAN FARM BUREAU FEDERATION, HEADQUARTERS OFFICES IN CHICAGO, ILL. Mr. O'NEAL. It is very gratifying to me to be able to appear before your committee this morning, Mr. Chairman and gentlemen of the committee with the leaders of the other national farm organizations. Mr. L. J. Taber, master of the National Grange, Mr. John A. Simpson, president of the Farmers Educational and Cooperative Union of America, and myself, with our officials who are directly concerned with legislative matters, have within the last week been able to agree on several legislative undertakings, one of which relates to the agricultural marketing act. For years it has been a common statment that agriculture is divided; for years it has been promised agriculture that if it will speak with one voice it can get whatever it wants at Washington. Not to extend the argument whether or not agriculture has been divided for years past, but merely to state that agricultural organizations for years, particularly on legislative matters, have been harmonious to a remarkable degree, let me now convey to this committee the information that if a definite unanimity of opinion is all that is required to secure for us at Washington that which we ask, then we are sure this winter to secure what we want in regard to the marketing act, for we are indeed unanimous on that matter. The resolution in which the three organizations state their position is clear cut and is easily understood. Its language is simple: We insist that the agricultural marketing act shall be continued in force as a principal method of stimulating cooperative marketing and advancing the cause of disposing of surplusses so that they will not depress the domestic price. The marketing act should be amended immediately by the inclusion of the debenture plan, equalization fee, or any other method which will make it effective in controlling surpluses, in making tariffs effective on farm crops, and in securing for American farmers cost of production on those portions of their crops sold for consumption in our own Nation; nothing less is a remedy for the agricultural marketing problem. It is not necessary to take time to explain what this brief resolution means. I merely want to state in relation to it that the three organizations which are appearing before your committee this morning want the marketing act continued for two or three reasons stated in the resolution. Also these organizations want the marketing act amended so that it will be more competent to assist agriculture than otherwise would be possible. Not being content, however, merely to ask that it be amended, we state specifically the type of amendments which we desire. Special reference is given in this resolution to the equalization fee and the debenture plans. However, it demonstrates again, if demonstration further is necessary, that the national farm organizations are not wedded, each in its own group, to a particular kind of amendment. We state in the resolution that “any other method" than the equalization fee or the debenture plan, which will do the things expected of those two plans, will be approved by us. Following the record of several years which the American Farm Bureau Federation has made in support of the equalization fee plan. I shall again this morning put this organization on record in favor of that plan in the main as it is now before your committee in H. R. 6992 by Congressman Norton of Nebraska. Following the unanimity of thought and action outlined in the above-quoted resolution of the three organizations, I wish also to inform the committee that we join hands with the National Grange in its advocacy of H. R. 7236 by Chairman Jones of this committee, the debenture plan, and desire that both plans be incorporated in the marketing act, neither to displace the other, nor any other portion of the act, but to make the act that well rounded scheme of controlling surpluses, making tariffs effective, and securing cost of production to farmers, which we have long advocated. It is not my purpose, however, to explain in detail any of the plans proposed for the betterment of the marketing act. I shall hope to make some observations relative to the equalization-fee plan and expect that representatives of the National Grange, which organization for several years has supported the debenture plan, will before this committee explain the technical features of that plan. The bills now pending before your committee in regard to these two plans are separate measures, and, although they will be explained separately—their technical aspects requiring such separate explanation-I want to assure this committee that it is the hope and desire of the representatives of the three organizations that the committee consolidate the equalization fee and the debenture plan so that the Federal Farm Board will have a perfect and free option to use either one, or both, or whatever present instrumentalities may be in the marketing act to aid agriculture. From this statement you will note that there is harmony of effort in amending the marketing act, and a desire on our part that, although the bills are now pending before this committee in separate forms, it will be comparatively an easy task for the legislative drafting service of the House to fit both plans into the marketing act with optional privileges for use on the part of the Farm Board. For years the equalization-fee plan was advocated before Congress and the committees thereof, mainly in regard to marketing surpluses abroad. That feature of the plan is still the most important one, and perhaps is as important now as ever it was. However, in the years that have gone by since the equalization fee first was discussed on Capitol hill we have enlarged our ideas somewhat in regard to it and now see that this plan is capable of being used at home in our domestic markets in controlling surpluses, seasonal and otherwise. Taking up the domestic aspects of the proposition first, let me say there was nothing in the last McNary-Haugen bill which passed Congress which would have prevented the equalization fund provided for from the accumulating equalization fees being used in the domestic market in finding industrial outlets for the surplus quantities of our farm crops. Since our former fights to enact the equalization-fee plan ended we have gone through a tariff-revision controversy before Congress. We have noted that one of the essential features of tariffs for agricultural products is to get such rates of duty on raw products, on processed forms of raw products, and on products which by substitution compete with those raised on our farms, as will permit the sale of our crops, surplus and all, in the home market. This tariff fight has vividly brought to our mind the situation which confronts us right here at home. We have talked a lot, as I have just said, in regard to surplus disposition abroad. Not minimizing the continuing necessity of disposing of surpluses abroad, I must now state that with proper tariff rates on such groups of commodities as I have just above described we could use the equalization fund through cooperative organizations to handle our surpluses, to process them here at home, to market them in industrial forms, and do all of this through our well established commodity marketing groups, and give us 100 per cent farmer control of the marketing of farm products. For instance, and to be specific, the equalization fund could be used in the building of factories to extract starch from four crops which either seasonally or regularly have surpluses-corn, wheat, rice, and potatoes. The equalization fund also could be applied to the building of drying and freezing plants so that the spring seasonal surplus of shell eggs could be disposed of at home-that is, in the domestic market-in finding new outlets for eggs in the dried and frozen forms. The equalization fund could be used also in manufacturing industrial alcohol from certain of our vegetable and the lower grades of grain. This fund could be used to discover and develop new uses for cotton, which uses are now in certain instances largely made impossible on account of foreign products coming in to displace cotton. The equalization fund could be used to develop vegetable oil outlets for some of our oil-bearing seeds, soybeans being a particular example which could be held in mind. The manufacturing of various sugars from plants other than beets and cane is a growing commercial possibility and could be developed by the wise use of portions of an equalization fund. Of course, the equalization fund in all the above-mentioned domestic enterprises would be used by cooperative organizations, not by the Farm Board itself, nor by the Government. The equalization fund, not being a Government fund, would not subject the Farm Board and the cooperatives to the criticisms which are now all too common on account of the use of tax funds in handling farm crops. Of course, when cooperatives enter into such industrial activities as those above outlined, they may expect severe criticism and competition but the cooperatives are getting both criticism and competition now so the situation would not be changed. It will be seen from the above enumeration of methods in which the equalization plan could be used right here at home in our domestic market that this plan is definitely based on the tariff, or protective, principle. Anyone who advocates the equalization-fee plan, first of all, either must advocate the protective principle or must concede that it is so inextricably interwoven into our economic structure that it will not soon be displaced; which leads to the unavoid |