very satisfactory. We understand that the 1937 to 1946 period gives virtually the same purchasing power as the existing 1909 to 1914 period.

We set very much more store by a stable, high price based on a high stable parity standard than a small gain or loss of acreage. Price loss is a disaster. Small acreage loss might be recouped.

A. This period (1937-46) covers virtually all farm commodities, and it maintains closely the farmer's-and particularly the cotton farmer's-same relative purchasing power position as the old period (1909-14).

B. We oppose a moving base period in this era of economic instability. We prefer a fixed base period, which could be subject to eventual change if conditions warranted.

C. The new formula is respectfully opposed because:

(1) Except for the 5-percent yearly limit, or fall, it would immediately drop the parity of cotton by 2 or 21⁄2 cents. Even with the 5percent limit, a 3-cent fall by the close of December 31, 1950, is permitted and is only too likely. The parity itself could drop 3 cents by that time.

(2) The new parity formula is tied unnecessarily, as we see it, to an index of other farm commodities so that, if cotton prices fell in an era of scarce wheat or meat, cotton parity and prices would be lowered irrelevantly, with injury to the cotton farmers as argued above in I. (3) One purpose of the new formula, as we conceive it, is to induce conversion to the higher parity product. But, in fact, owing to investment in specialized equipment, and to other conditions, like the persistence of old ways and of special skills, conversion is often limited, slow, and costly. For instance, cotton can somewhat painfully convert to cattle and hogs, and that is happening in our community, incidentally increasing for a time, via herdbuilding, the very scarcity and high cost of meat sought to be prevented; eventually, however, adding to overproduction of animals. Instead of balancing, the formula might tend to augment, unbalance, and foster unwieldy swings. Possibly the cotton grower's least difficult conversion would be to corn; but the effect on the corn-hog economy of the Midwest, as momentum were gained and vested interests established, would be undesirable.

Be it resolved, That:

III. A 5-year moving average, beginning with the period 1944–48, inclusive, be used on break-down of national allotments to States and on State allotments to counties, these allotments to be on a basis of production.

Argument: A. A 5-year base in an uncontrolled period is long enough to establish natural trend and average out abnormalities. A shorter base tends to overweight unusual single years or mushroom growths.

The following typical States in the old Southeast, the Mississippi River Valley, and the new cotton Southwest, respectively, would show the following percentages of their 1948 acreage:

Any of these periods, of course, would operate drastically on some areas of the belt, any one of the three. In the interests of a rough equity and to safeguard important areas from undue shock to their economy, perhaps some way could be devised to limit that reduction in any one year. We have in annex I similar percentage figures for the remainder of the Cotton Belt States

B. We favor production rather than acreage for national-to-State and State-to-county break-downs because accurate production records are kept, whereas acreage figures are estimates at best.

Be it resolved, That:

IV. Allotment between parish or county and farm be based on percentage of cropland (minus specified basic crops-rice, tobacco, et cetera):

Argument: We believe that allotments to individual farms on a percentage of cropland should be made for a 5-year period or until a definite history for each farm is established, whereupon change to break-down on a history basis could be made.

Our reasons: Since 1942 no acreage has been measured and no reliable records of cotton planting on individual farms are available. To base individual allotments on history today would invite exaggeration and cause needless friction. I could put that in plain language and say prevarication would cause needless friction in the counties. Be it resolved, That:

V. A minimum national baleage allotment be set up of 10,000,000 bales, or of 1,000,000 bales under the consumption of the preceding marketing year, whichever is smaller.

Argument: This provision would prevent any administrative authority from cutting acreage so drastically as to disrupt or destroy the cotton economy, while it allows him latitude in bringing supply into line with consumption. From present indications, the contingency of less than 10,000,000 bales consumption is unlikely; but should it fall below 11,000,000, the Secretary of Agriculture would be empowered to set a national goal of 1,000,000 bales less. In any real emergency the Congress could and should determine a lower floor.

Be it resolved, That:

VI. The moral obligation of the Congress in Public Law 12 be carefully fulfilled. This is simply a matter of the faith of the United States Government.

Be it resolved, That:

VII. The 1949 acreage be eliminated from current or future calculation of acreages.

This is to avoid a race for acreage base and/or old-crop status. Here may I interject that we favor some plea from the administration or from the Congress or some high authority to the belt to avoid overplanting this year. No law can cover it. If there was some way in which overplanting could be tied up with the 1950 acreage quotas or some other benefits or penalties attached, it might avoid the very thing we are arguing about now: that is, the expected surplus on 1949 production. It would possibly avoid a drastic cut down to 17,000,000 bales, which is being discussed for 1950 and forward years. We do not think enough is being done to persuade this year's planter or grower to hold his acreage in line.

Mr. ANDRESEN. Mr. Chairman, on that point I would like to ask the gentleman if the action taken by this committee and by the House to eliminate 1949 acreage from the calculation was not affirmative action showing the people that they should not produce so much?

Mr. AMACKER. Yes, sir; that is affirmative action, but our thought is that more should be done continuously. Of course the point of that is very clear and very commendable, but we just feel that there was not enough pressure being brought to bear on the entire Cotton Belt to hold to the past year's acreage or even to reduce.

Mr. ANDRESEN. That should come, then, from the executive depart

ment.

Mr. AMACKER. I would not venture to suggest that.

Mr. PACE. Mr. Amacker, if I might interrupt there, inasmuch as the resolution passed the House on Wednesday and is now before the Senate, it was anticipated that possibly we should not prejudge the attitude of the Senate, but it is the plan, immediately upon favorable action by the Senate, for this committee to request the Secretary of Agriculture to issue a strong statement showing the probable disastrous consequences of going to a large acreage this year. Mr. AMACKER. That will be splendid, sir.

Be it resolved, That:

VIII. A limitation be set, in national law, of $2,500 to the payee for soilconservation payments.

Argument: Under the present $750 limit, part of funds allocated is often returned to the State. The Louisiana Delta Council preferred prorating on a per acre basis. The State committee would determine the amount that could be earned per acre, by dividing the sum available by cultivated acreage. The council's view is that every acre requires conservation, regardless of the ownership, and that limitation of payments restricts conservation more than it restricts persons.

The Louisiana Farm Bureau noted the practical expediency of setting a limit per person, but recommended that the limit be raised to $2,500.

Be it resolved, That:

IX. The law be made explicit that title 32 funds should be used for development of new end-uses for storable crops and particularly export crops as well as perishable crops.

Be it resolved, That:

X. The present basis for the loan program (Middling 7/8) be retained.

Argument: A. Fixing the loan rate on the basis of average price for the year for each location is too difficult of computation and administration.

B. We see no advantage in the change for the basis of loan cotton; for the present basis of Middling 7/8, with differentials for location and quality, assumes equal return for equal value everywhere.

Be it resolved, That:

XI. Crop insurance be approved in principle.

Argument: Assuming support prices at a high level, crop failure remains the farmer's most serious economic hazard. Therefore, we favor insurance in principle.

But we realize the considerable practical difficulties involved; and hence, unless an actuarially workable plan could be worked out, we refrain from pressing this point.

Be it resolved, That:

XII. Maps and quotas be made available to farmers not later than January 1 of the year in which quotas are to be in effect.

Be it resolved, That:

XIII. A penalty of 50 percent of parity as of July of the year of production be levied on cotton produced from acreage in excess of acreage allotment.

Be it resolved, That:

XIV. Unredeemed loan cotton and other surplus cotton be, as far as practicable, exchanged with foreign countries for the purpose of stock-piling strategic materials. Be it further resolved, That:

XV. A committee of three be appointed by the State of Louisiana Farm Bureau President to present these resolutions to the House Committee on Agriculture in Washington.

Mr. Chairman, we thank you deeply for your kind patience and courtesy.

Mr. PACE. Thank you very much. Are there any questions? Mr. ANDRESEN. Mr. Chairman.

Mr. PACE. Mr. Andresen.

Mr. ANDRESEN. As I understand it from your statement, you prefer a straight nonflexible support price of 90 percent?

Mr. AMACKER. Yes, sir.

Mr. ANDRESEN. And the law as it stands now for the 1950 crop should be repealed under your recommendation.

Mr. AMACKER. Amended or altered to that effect.

Mr. ANDRESEN. I was interested in your recommendation about having a support price for both cotton and cottonseed. I think this is the first time to my knowledge that I have heard that proposed. Why do you want it on cottonseed?

Mr. AMACKER. We feel that the fall in the price of cottonseed is harmful to the tenant. Of course, the gins and the larger farmers would perhaps get some benefit from a high cottonseed price based on a high support level. But it goes to the little man as was pointed out in preceding testimony.

Mr. ANDRESEN. It goes to the big one too unless he holds his cottonseed. Is it not customary when a farmer brings his cotton to the gin for the seed to be extracted there and the cotton and the seed to be sold about at the same time?

Mr. AMACKER. Some hold their seed, of course, but not everybody is in a position to do that.

Mr. ANDRESEN. What percentage of the production in Louisiana would hold their seed?

Mr. AMACKER. That I could not say, sir.

Mr. GILFOIL. I would say it would not exceed 1 percent, Mr. Congressman.

Mr. ANDRESEN. They generally sell it when they bring their cotton in to the gin?

Mr. GILFOIL. As was pointed out by Judge Oliver when you were absent, it is customary for tenant farmers particularly to get their seed money when they gin their bale of cotton. No lien is ever attached to that, so far as I know. I do not know of anyone who does that.

Mr. ANDRESEN. Has it not been your experience too that when the farmer sells his seed he generally sells it at the bottom price? Mr. GILFOIL. Yes, sir.

Mr. ANDRESEN. And after he has gotten rid of it, then the price goes up?

Mr. AMACKER. Yes, sir.

Mr. ANDRESEN. Is it not a fact that there are comparatively few people or crushers who buy the seed and that after they get control of it they will boost the price 10 or 15 cents a pound on the oil and the farmer is the one who loses the money?

Mr. AMACKER. That is very often true in our experience.

Mr. ANDRESEN. Cotton oil today is around 14 or 15 cents a pound. Mr. AMACKER. I do not remember the exact price, sir.

Mr. ANDRESEN. The top on oil was around 24 or 26 cents a pound just a few months ago.

Mr. AMACKER. It has dropped very heavily.

Mr. ANDRESEN. And somebody, notably the buyers, are staying out of the market, waiting for the price to go down and waiting for the farmers to submit their products at the lowest price and after they get hold of it, up will go the price and the farmer will lose the money. That is one reason why you want price support on cottonseed.

Mr. AMACKER. Yes, sir; it is.

Mr. PACE. We now have laws authorizing the support of cottonseed at 90 percent of parity. The difficulty has been that the price of seed has never dropped to 90 percent of parity and consequently there has been no insistence on the part of anybody that we put the program into effect. Frequently when you put a support program into effect that is considerably below the market price it has a tendency to break the price down to support levels.

Secondly, it cannot be said that the circumstances related by the gentleman from Minnesota worked out that way this year. My information is that there are many crushers who are now facing bankruptcy because they bought seed at $90 or $100 a ton and now the oil market has dropped to 14 cents a pound. Fortunately for one time any producer who did not want to get too much for his seed has gotten his money. The main difficulty has been that the department which is chargeable with the issuance of export licenses has refused to permit these oils to go into the markets and has permitted such enormous surpluses to accumulate that the crushers do not even have tanks to put the oil into. But the President stated yesterday that he was going to take that authority out of that party and put it out of that department into the Department of Agriculture. We are hopeful that the oil market will soon react up to the world market. Are there any other questions by the committee?

Mr. ANDRESEN. Mr. Chairman, if I may continue, I thank the chairman for his observation. That may be the situation on this last year's crop, but my observation over a period of years with reference to cottonseed is that the farmer sold it at the bottom and after the crushers got hold of it the price went up and the consuming public paid the bill.

Mr. PACE. That happens quite frequently.

Mr. ANDRESEN. I do not know whether the parity support price will help on it or not. I am glad to know that the gentleman feels there is support price on seed that could be put into operation. If the price of the seed has been above the support price, of course, there was no need for it.

Mr. PACE. That is due to the fact that the price of cottonseed is very low and out of line.

Mr. ANDRESEN. That is all for the time being.

Mr. PACE. Are there any questions?