Mr. PATTON. But I go on there and also point out that he shall have the right of appeal there and that there should be a county committee composed of farmers who establish the policy within the county. I envision that the Secretary's representative, Mr. Congressman, would simplify the situation where at the present time the farmer has to wear out half his shoe leather going to different places in the courthouse.

Mr. HOEVEN. But in one place you say you want the farmer to handle his own farm, and in the next breath you say the Secretary of Agriculture should do his planning for him.

Mr. PATTON. I beg your pardon. I did not intend to say that he should do his planning. It is a point of effort and the function of the Secretary of Agriculture's representative would be the same as the extension agent or the Farmers' Home Administration man who represents the Government at that level or down at the county level at the present time. It is an attempt to coordinate into one the whole thing that is now hitting him from half a dozen different directions. It is an attempt to get him to coordinate his total planning instead of having it strewn in half a dozen different pieces.

STATEMENT OF RUSSELL SMITH, LEGISLATIVE SECRETARY,

NATIONAL FARMERS UNION

Mr. SMITH. Mr. Chairman, it may help Mr. Poage and Mr. Hoeven to get the whole picture if I describe how this thing was evolved in the first place. Mr Patton asked me to sit with the program committee at our convention the year this thing was adopted in the first place. I think nearly everybody on that program committee either was or had been a triple-A committeeman. Actually there was no mention of the British or any other country's farm program that I remember in the week of discussion.

Mr. PATTON. I doubt that they had even read about it.

Mr. SMITH. I doubt it bery much. What they were interested in was in modernizing and bringing closer to their farms the Federal programs that they were going to have anyway. They were very much interested in devising some scheme built on the triple A program which, in itself, Mr. Hoeven, is devising farm plans in effect. It is doing it with these large-scale national programs and referenda on acreage allotments and that kind of thing that do not hit exactly on the individual farmers' needs. Their feeling was that if you had somebody in there in the county directly responsible for these national programs to whom they could go and argue, that they would get far less regimentation or Federal planning than they would if they had to rely on a triple A committee somehow getting its voice heard in Washington. That was the way they thought about it.

Mr. PACE. Are there any other questions, Mr. Poage?

Mr. POAGE. No.

Mr. COTTON. I have a question.

Mr. PACE. Mr. Cotton.

Mr. COTTON. Mr. Chairman, I would like to interrogate the witness about what he says on page 4. I am greatly interested and I am greatly astounded by the frankness you have shown, Mr. Patton. What you say is about as bold a declaration as I have listened to.

On page 4 you advocate a measure which will call for the use of $15,000,000,000, presumably raised from all the taxpayers in this Nation and then you go on to say

A primary aim of that bill is to afford capital to private enterprisers for the industrialization of the South and West. In order to accomplish that end, it will, of course, be necessary to use this loaning authority also to break up monopolization, the control of the majority of which is centered in the industrial Northeast.

That is a rather frank declaration of wor on the section of this country from which I happen to be one of the few representatives on this committee. I am wondering about the idea of using the power and resources of the Federal Government to break one section of this country for the benefit of the other. I am wondering if you are taking into consideration the fact that the very thing which you hope for, which is perfectly legitimate, that a share of the industries of New England and the Northeast should get down South, that they are going south to be near their raw materials and they are going south also, Mr. Patton, because New England and the Northeast today is the stronghold of trade-unionism, of which I assume you are a friend, and they are going south in many instances to escape certain restrictions which they think they have on them because of organization. Do you seriously advocate that it is the legitimate function of Government to discriminate against one section, to break one section, for the benefit of another?

Mr. PATTON. This might sound that way to you, Mr. Congressman, but actually I have said out in the West and the South that all that I am talking about is that I want the industrial Northeast and the capital control to get their feet off our necks. They can go ahead and have industries but we need industries in the South and in the West and we need more production in this country. There is no limit other than natural resources on the standard of living we should have.

I generally and sincerely feel, from my point of view, that the West and the South would be much better off if we had a much higher rate of industrialization development. It would give us local markets and put many of our industrial commodities close to us. We would not be paying very substantial freight rates coming and going on the products.

I just do not happen to think that the private capital structure will move fast enough to do it. As far as monopoly is concerned, I am for the antitrust laws and for enforcing them and strengthening them but some phases of corporate industry in this country, as the FPC said, have gone a long way toward the collectivization of this economy. I think we are going to have to have more Henry Kaisers and more daring individuals who are not a part of what is commonly called the monopoly scheme to start providing some competition. A strong industry in the West in several different fields, a strong industry in the South in whatever fields will fit there, would very definitely tone up the competition in this country, and would be of welfare to all. I have no bone to pick against the Northeast or any section of this country. I look upon this country as a whole. It is a great

nation.

On the other hand, I do not think the Northeast has any monopoly on know-how or any other phase. Certainly we in the West and the South are going to have to do something more than we are now doing

to increase our opportunities for our own people. Our biggest exports in many of our Western States and I think it is true in many Southern States, are children. They have to leave home to get a job. Many of our Western States-I am not now speaking of the Pacific Coast States, but the so-called Midwestern or Plains States-and I think this is true of some of the South although I am not familiar with those statistics have shown a decrease in population. Yet we have the raw material resources right out in the great Missouri Valley and many other areas to increase substantially the productive capacity of this country and make for a higher income for everyone.

Mr. COTTON. I do not want to take much more time, but you are aware of the fact, surely, that a decrease in population is now taking place in the Northeast, that the South and the West are the growing sections of this country? You must be aware of the fact that heavy taxes are paid in the Northeast. I, for one, have voted and intend to continue to vote to use much of that money for dams and reclamation projects for the West and the South and I am glad to do it. The thing that startles me is to have a representative of an organization such as yours come in here and frankly state that you wish to create a powerful governmental corporation with a tremendous sinking fund and then use it to break my section of the country for the benefit of the South and the West. That is a little bit outside the purpose of the Government.

Mr. PATTON. Mr. Congressman, may I assure you that I did not intend to set out any intent or desire to break any part of the country, but I am against monopoly and I would be for the RFC under the Full Employment Act of 1950 to loan whatever numbers of millions of dollars it was found necessary, and if it could be found it could best be done in the Northeast to break whatever monopolies exist in the Northeast, just as I would in the South and the West or wherever they exist. If those funds could be used for loans to the Henry Kaiser type of fellow to take on one of the monopolies that had its primary headquarters in the Northeast and create more employment there and give a better opportunity to the people of that area I would be for them being used there just the same as anywhere else.

As a matter of fact, the provision for the act does not get into geography at all and should not.

Mr. COTTON. Mr. Patton, are you trying to suggest that the northeast sections of this country is not subject to the same Federal antitrust laws and other restrictions on monopolies that every other section of the country is? What rights of monopoly do we have that you do not enjoy?

Mr. PATTON. I am not even attempting to suggest that. What I am saying is that the capital control of this country very largely rests in the banking centers of the Northeast and the industrial plants that are centered there. That is certainly true of steel. The control rests in that area. There are a number of others. A great many of our western towns-and I am not even going to try to speak about the South are populated 50 percent by managerial representatives of capital who have their headquarters in the East. I am not picking on the East.

Mr. COTTON. Is that not their right?

Mr. PATTON. All I want to do is equalize their position and see that we have some new capitalists in the West and the South who live there, who grew up there, who are daring people.

Mr. COTTON. Fundamentally, where we differ is the fact that you think it is the function of the Federal Government to put its power behind bringing about this change in shift which may be desirable. Mr. PATTON. That is right.

Mr. COTTON. I merely want to say that I shall see to it that the attitude of your organization in this respect is known to every representative in Congress from my section of the country: New England, New York and the rest. If this is going to be your attitude, we want to know it in advance and we appreciate being warned.

Mr. PATTON. I hope you will include in your reference to your people that I am not picking on the Northeast nor am I attacking any part of the country. I merely had in mind, when I proposed the Full Employment Act of 1950, the development of the South and West and the development there of industries which we can use and, secondly, a further attack on monopoly. We talk all the time in this country about the great free-enterprise system. Yet, many of the penalties of the antitrust decisions are merely licenses to steal.

Mr. PACE. Will the gentleman yield to Mr. Poage?
Mr. COTTON. I will yield to Mr. Poage.

Mr. POAGE. Mr. Patton, without any desire to pass upon the merits. of your proposal to have the Government interfere with the natural shift of industry, to accentuate it or to dam it up, it might be noted in passing, might it not, that most of the great industries that now have their domicile in the Northeast were able to establish their hold and to build their great structure in that area as a result of the action of the Federal Government of the United States in protecting them by a system of tariffs that bore heavily upon the people of the South and the West for a hundred years, and that we of the agricultural producing areas of this Nation have largely paid for the investments in those great corporations and industries that now feel that the Federal Government should never have anything to do with the location of any industry.

Mr. PATTON. I agree with that, if you are asking me whether I do. Part of the problem of the cotton South today is the fact that we exported our land and our soil and our people to New England.

Mr. POAGE. Let me go further, Is it not also true that those same industries that were able to establish themselves solely because the Federal Government of the United States imposed a tariff that made it impossible for the cotton farmer of the South to buy in the cheapest markets and made him pay tribute on every pair of shoes that he wore to a man in Lowell, Mass., that that same Federal Government, through the Interstate Commerce Commission and the action of this Congress, have imposed on the sections where I live a penalty of 67% percent on the freight rates on every carload of those manufactured articles as compared with the rates that those same factories pay in shipping the same distance in the Northeast? Is that Federal interference? Does the Government have anything to do with how those factories got there and how they stayed there?

Mr. PATTON. Certainly.

Mr. PACE. The gentleman from New Hampshire.

Mr. COTTON. I will yield to the gentleman from Texas, Mr. Worley. Mr. WORLEY. Would it be possible for us to confine ourselves at this time only to the question of cotton-acreage allotment? I would like to have both you gentlemen for lunch later on, and talk over these other matters.

Mr. HILL. May I ask a question?

Mr. COTTON. I will yield.

Mr. HILL. If you are going to have these two gentlemen for lunch, will you include me, because Mr. Poage and I are good friends and Í am from the West, too; and he has a resolution up his sleeve that he proposes to take Colorado into Texas. If he is going to do that, I want to be at this luncheon, because we have a lot in common, especially on freight rates. I think if you are going to do that, I will pay for Mr. Cotton's lunch if you will include me.

Mr. WORLEY. Gladly, but I suggest that each may pay for his own lunch.

Mr. COTTON. Mr. Chairman, I did not want to take up so much time, and in the past 2 years I have very rarely taken up the time of this committee. I merely want to say that, while I appreciate the attitude and the sentiments of my good friend Mr. Poage, I have noticed that there has been a marked difference in his feelings and that of his colleagues from other sections of the country about tariffs since they began to get our industries away from us. Regardless of tariff, this scheme is entirely different.

The fundamental thing that I object to, Mr. Patton, is the fact that you frankly and boldly-and I appreciate your frankness-take the position that this Federal Government shall collect taxes from all of the people of the country, with the open declaration that the money shall be used to move industry from one section to another section as the Government, in its infinite wisdom, seems to feel it should be moved.

Incidentally, we still have a few farmers in New England. They are not big farmers, but they have farms. When you do that, you take away the farmers' market. It is quite a responsibility and it is a rather new and startling theory of government, about which I just cannot keep quiet; and I think my good friend Mr. Poage and some of these other gentlemen, if such a declaration were made about their section, would probably call attention to it.

Mr. PATTON. Mr. Chairman, I want to again insist that the record be made clear that I do not believe in the subtraction process. What I am talking about is adding something to the total scheme of things in this country. I would have you keep all that you can keep up there in New England. We are not worried about that. But let us have in the West and the South some home-grown product that controls out there and that we do not have to get our answers on from the Northeast before we can make a decision.

Mr. COTTON. Your statement on page 4 speaks for itself.
Mr. PACE. Has the gentleman concluded?

Mr. SMITH. Mr. Chairman.

Mr. PACE. Mr. Smith.

Mr. SMITH. May I have one slight addition here that may be of interest to Mr. Cotton? In the Seventy-ninth Congress, Senator Bailey had a bill in for the industrialization of undeveloped areas. In the back of the printed hearings on that bill in the Senate Commerce Committee, there is a map which shows the undeveloped areas that ought to be developed by industrialization. A great many of them are located in New England and the Eastern Seaboard States, so this bill really is not intended as a blow at industrial development of any section. It is a blow at monopoly wherever it exists, and it just happens that most of it is centered in New York.