loan advanced? If a restriction had been put there of $10,000, would that corporation have been able to function?

Senator FRAZIER. That is different.

Mr. LEMKE. I know, but not to us.

Senator THOMAS of Oklahoma (presiding). Are there any further questions by any member of the committee? If not, thank you very much, Mr. Lemke.

Mr. Bowen, we will now hear you, if you have something to say.

STATEMENT OF A. E. BOWEN, OKLAHOMA CITY, NATIONAL ORGANIZER NATIONAL PRODUCERS ALLIANCE

Mr. BowEN. My name is A. E. Bowen, Oklahoma City. I am the national organizer of the National Producers Alliance, and I speak for that organization and also for the Farmers Union organization. Mr. Chairman, I had hoped this afternoon to be able to talk to the full committee here. As I look around the table I see that practically every Senator here is a person who thinks almost exactly as I think.

Ten years ago these hearings were going on on farm relief legislation. I think Senator Norris will remember that eight years ago this winter I appeared before the agricultural committee of the Senate two different days, arguing in favor of the Norris-Sinclair Grain Marketing Act that was before the committee at that time.

We who represent farmers' organizations feel that we have made some progress. The committee has recommended legislation, and, as Senator Norris says, the Congress has passed that legislation and sent it to the White House. The President has vetoed that legislation. The farmer is worse off to-day than he was 10 years ago.

Senator FRAZIER. And the farmers will blame Congress for not passing these measures over the President's veto.

Mr. BowEN. Yes; Congress is to blame for not passing the legislation over the President's veto, but the men who voted for the legislation and to pass the legislation over the President's veto are not to be condemned.

These three organizations have agreed on a bill that has been submitted to the members of the committee to-day. The organizations are not all agreed officially on the Frazier bill, but I want to say that the organizations that I speak for are 100 per cent for the Fra-. zier bill in principle.

Several times before this committee in the last week the question has been asked: "Well, if you finance the farm mortgages, as the Frazier bill proposes, it just means that you will start the printing presses up and print an unlimited amount of money."

Every time anybody discusses the money question it seems they are afraid if we leave the gold standard we will go to the very opposite extreme, as they did in Germany, where they started the printing presses going and printed bales of money. It is reported over there that they would take a bale of paper and make money out of it, and after they got the money printed, there was not enough money printed to buy another bale of paper, money was so cheap.

Whenever I think of this money question it reminds me of two men who died. One of them died with what the doctors call, I believe, anemia, where you do not have enough corpuscles in the blood. An

other man over here died with a blood clot on his brain. One man dies because his blood is too thin. The other man dies because his blood is too thick. The man who dies with a blood clot on his brain has got just as much blood in his body after he dies as he had before, but it is not moving around, it is not circulating. That is the situation we have come to in the United States to-day.

In my experience in lecturing, which I have done for 20 years, before farmers' cooperatives and political organizations, whenever I have suggested that anything be done for the people, I always run up against this question, "Where are you going to get the money to do it with?" They never say, Where are you going to get the overalls, where are you going to get the food?" They never ask you where you are going to get the bread and butter. They always will ask you where you are going to get the money.

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Now, they ask that because everybody knows that money is scarce. They do not ask where you are going to get the food and clothes, because everybody knows that food and clothes are plentiful.

Money ought to be a medium of exchange. The only reason we want money is because it is convenient. It is more handy for the farmer when he goes and buys some sugar to pay for it in money than it is for him to take in a certain number of eggs or a certain part of a beef, or something of that kind, and make a trade. Money is a measure of value and ought to be based on the articles that are being measured.

The gold standard has just got us where we are. The gold standard was adopted because gold was scarce. As long as you have got the gold standard, money is going to be active. If land, as provided in the Frazier bill, is not the best security in the world for an issue of money, then I don't know what is.

Senator NORRIS. Mr. Bowen, I want to ask you something on that point. I think that is very interesting. Without trying to offer any criticism on your suggestion that land be made the basis, perhaps if I were going to make any objection at all to it, it would be that it is not practical, because we have not got the votes. We can not convince the people who have followed this other scheme for so many generations and years. We would have to go on an educational expedition that would last for 10 or 12 years before anybody could be converted. Would the same thing be brought about now if a measure that I understand is now on the House calendar were passed? I have not read it, but from what I have been told about it the fundamental principle is this. It has for its object the raising of commodity prices, just like you said, that money should be based on what these commodities are worth, and they take as a basis, artificially, the report of the Labor Department, wherein they get an index figure for several hundred commodities that are in general use, and direct the Federal Farm Board to issue currency by the buying and selling of Government bonds, and keep that commodity price, based on a series of years when it was believed, at least, that the commodity prices were fair, and inflate the currency or deflate the currency up and down, to keep those commodity prices on that basis. Would that accomplish the same result?

Mr. BOWEN. I think it would help, Senator, but I do not think that anything can solve the farm problem that permits Old Man Six Per Cent to live. I believe it says in the Bible some place that he

who lets out money for increase consumes the substance of a nation, and I believe that is true. This Frazier bill reduces the rate of interest down to 12 per cent; and it will save agriculture.

Senator NORRIS. I think it would be very desirable to reduce the rate of interest. I agree with that. But the interest that would have to be paid under this scheme I have briefly outlined would be much less than 6 per cent.

Mr. BowEN. It would be less than 6 per cent is now under the present value of money, you mean.

Senator NORRIS. The rate would be less than 6 per cent; and your other statement is true, also.

Mr. BOWEN. Yes.

Senator NORRIS. In other words, I am wondering in my own mind if we would get relief, particularly to agriculture and I am one of those who believes if we get the right kind of relief to agriculture, everything else will be relieved, because I think it is the fundamental thing after all; but if we would say in a certain year that these commodity prices of something like 400 necessary articles that go to make up the cost of living were a certain figure and we would use that as a basis, wouldn't it be possible to keep that commodity price practically on that level all the time by the Federal board saying, "When it goes below that level we will buy some bonds, increase the circulation until it gets up to the level. If it gets above that point we will reverse the operation and lower it."

Mr. BOWEN. I believe that would help.

Now, leaving the Frazier bill, which I repeat again our farmers are for, 100 per cent, I want to say a few words about the bill that the organizations have agreed on this morning. In my opinion, the farm problem can be solved with the greatest ease. In my opinion, without any increase in money, without any undue expansion of the currency, universal prosperity can be had by the people of the United States.

I am going to outline to you this bill that the organizations have agreed on. It provides that authority shall be given to the Farm Board. Now, there is one place where all of the bills that have ever been introduced before your committee, with the exception of the Norris-Sinclair grain marketing act, have been weak. In bills for farm-relief legislation that have been brought before this committee, it has been the endeavor of the ones who wrote the bill to provide for the exact operation of the law. They have gone into minute detail. The lines that you had to follow were laid down and ironclad rules were put out. You can not suggest any method of saving the farmers that almost anybody can not ask a lot of questions about. When you go into details here before this committee, members of the committee get lost in a labyrinth of doubt, questioning how will this detail work out and how will this detail work out and that detail work out. The members of this committee are busy men. I have been here now for over a week. This is the first time I have seen Senator Norris at a committee hearing. Most of the members are not here now. One of the members of the committee is chairman of another important committee, and he has only been in just as I came in, and went out.

Senator NORRIS. Now, Mr. Bowen, let me interrupt you there. Most of the members are like I am.

Mr. BOWEN. Busy men.

Senator NORRIS. For a long time I was chairman of this committee and I spent literally months and I did not do anything else scarcely except to sit in the committee room and listen to tales of distress and woe that came from the men and the women who were living in the West and the Northwest.

Bill after bill we gave attention to, one of which in particular I was the author of, for several months. Thousands of letters were written. I tried to get the ideas of all of the experts, so-called, that I could get, both those who were in favor and those who were opposed to it, only to see every time-and this is true, but I am not saying it to criticize somebody who happened to be President; commencing soon after the war, when Harding was President-only to see every one of those efforts fail, one after another; and I voted for bills that I had some doubt about. I think every member of the committee did. We were not always satisfied but it was the only hope that we could see. Time and time again we have said on the floor of the Senate and in letters and everywhere else that if this bill is not right you bring in a bill, and they did not do it; nobody did. They were satisfied themselves with criticizing ours, and they were always able to defeat us in some way or the other.

You will recall possibly, if you were present, on the bill you referred to before, the so-called Norris-Sinclair bill, at which time Mr. Hoover was Secretary of Commerce, he appeared before the committee and he appeared at my request-and opposed the bill; and the influence of the administration was so great on the floor of the Senate that we could not pass it.

After having for a year or two gone over this over and over again, I began to get frightened for fear I was going to lose my mind. I could not stand it, to listen to this distress. I had grown up on a farm. I knew what their troubles were; and with honest men in the Senate, and other places, I was often not able to convince them-they were busy, did not have the time always to give to it—and we failed, and I resigned as chairman of the committee.

Mr. BowEN. Senator Norris

Senator NORRIS. And that is the reason I resigned. I stayed on the committee, and I have always been ready, whenever the time came, to be at the committee and vote, but I have heard all these stories dozens and dozens of times, and I want to tell you it has had a wonderful effect on me, until I have been frightened at my own mental condition, sometimes, unable to get relief for the farmers of this country, when I knew they ought to have it.

Mr. BowEN. In what I said, Senator Norris, about members of the committee not being here, and this being the first time I have seen you here, I certainly did not mean that in any spirit of criticism. When I returned to Washington this year for the first time in several years, one of the things that pleased me more than anything else, was to see that you were still alive, and had some measure of health. I realize that you almost gave your life in years gone by at the head of this committee, but I want to go on making the point I was trying to make, that this bill that they have drafted here today, and that they have agreed on, authorizes and commands the Farm Board to do the one thing that is necessary to save agriculture, and that is to ascertain the cost of production of agricultural prod

ucts. That is the secret of anything that ever will be done to save the farmers of the United States. They must have the cost of production.

The Farmers Union wants the cost of production. The Grange wants the cost of production. The Farm Bureau wants the cost of production. The unorganized farmer wants the cost of production.

In years gone by we have disagreed as to how to get the cost of production. Some members of this committee have been in favor of the export debenture plan, so highly sold on the export debenture plan that they could not see any other plan as a success. Others have advocated the equalization fee, and have been so thoroughly sold on the equalization fee that they could not see the success of any other plan.

The organization I represent, the National Producers' Alliance, was built around a plan known as the allotment plan, and I am going to explain that to you briefly this afternoon, because, in my opinion, it is a plan that will work. It is a plan that everybody can understand. It is a plan that will reduce production, instead of bringing about overproduction.

It is a plan that will not necessitate the expenditure of a lot of money. It will not necessitate the appropriation of millions or hundreds of millions of dollars by the Congress, and it can be done under this bill that you gentlemen have agreed on here.

The beauty of this bill that the three organizations have agreed on, is that the Farm Board is instructed to get the cost of production for the farmers, and to try any one plan, and to change it if it does not work, and try another one, or modify any plan, or take a combination of all three plans, to find a method that will work and give the farmer the cost of production.

I am going to outline to you how, in my opinion, the allotment plan will make the farmers of this country prosperous. As Senator Norris said a moment ago, agriculture is the basic industry of the Nation, and when you make the farmer prosperous, everybody prospers.

I gave this illustration in asking one of the witnesses a question the other day. Prosperity is like a broad river flowing down here from the mountains. It has its source up there in the melting snows and the rainfall that falls on the mountainside. As the river flows along, we build a dam across it. We put a power plant there. We generate electricity. The water that goes over that dam moves the machinery. That does not wear out the water. The water is just as good after it has gone over that dam as before. It goes down the river a little farther, and we put another dam, and use the same water over again, and they use it until the water passes out into the

ocean.

Prosperity is like that. Where did that river come from? Its source is up here in the mountains. The source of prosperity is out here where the farmer is with his team and plow; the lumberman with his axe and his saw; the miner with his pick and shovel. That is the primary source of wealth. That is where it comes from. That is where it starts, and the money that the farmer gets out here when he prospers, when he pays his grocery bill, is not worn out. It just starts circulating. When the man he buys sugar from buys more sugar, or something else he has in his store, he circulates more money.