a graded price during the selling portion of the year. The selling portion of a year starts generally in September, and contracts for "future delivery are made principally for December, March, May, and July. It becomes necessary, therefore, to cover these dates, and to do this the market price not only of Chicago but of St. Louis, Kansas City, Minneapolis, have been closely scrutinized, and if you will take the prices of these cities for the past 15 or 20 years, you will find that the schedule that I have placed before you is almost identically the price or the average price of these grains during these years at the seasons and dates at which they are applied. We are not asking Congress to put up any money or to make any guarantees; all that is asked is that Congress shall say that the legal authorized prices of certain grains shall be "so much" and that any sales or contracts, below these amounts shall be illegal and can not be enforced. I wish you to distinctly understand that we do not fix a maximum; "supply and demand" will regulate the fluctuating prices over the minimum. We have no desire to inflate prices, nor on the other hand deflate them. What is needed is a minimum price that is fair to the farmer, and below which he can not be forced to sell. We have minimum prices of wages, railroad fares, and minimum prices existing on many articleswhich are accepted without question by the people. There is a great desire to keep "prices fixed'' out of politics and also away from "bear" speculations. In a great number of cases the farmer does not want "farm credits.' What he wants is a chance to sell at a price which, although low, can not be forced lower. He wants a chance to sell what he has got and not to put himself further in debt by borrowing more money. Traveling for this mortgage company in Iowa for the past two years I have found many cases where there are two and sometimes three years crops of corn on hand. These farmers wanted a chance to sell but have been forced to borrow to carry them over from time to time. I have talked with many on this subject, and what they desire is a settled definite minimum price which will cover not only the early months of the season, but what would be May and July deliveries. All above these minimum prices would be govered entirely by "supply and demand.”

I have also talked with bankers in nearly every county of northwestern Iowa, and I find that they have been at a loss to know to what amount of credit they should extend to a farmer, while if a minimum price is once known they would have some basis on which to make calculations. For instance, a farmer having an amount of 1,000 bushels of corn on hand in October, and wants to borrow money for 90 dayssay, to January, the banker would know from this schedule that the minimum price of corn in January would be 45 cents, and on that basis he would know what amount of credit should be given, with security of 1,000 bushels of corn at 45 cents a bushel. I find there is an enormous demand among the principal bankers for this method of procedure. This minimum schedule is so that they could know where they were at. I have also talked with millers, oat meal manufacturers, feeders of stock, rice millers, and cotton men, and the consensus of opinion is that a minimum price, such as is proposed in this bill, would be very acceptable to them, and that this schedule of prices is very close to what has been the average prices for the past 20 years. I now give you the table of dates and prices of oats, corn, wheat, and rice:

You will see from it that oats and corn are raised only 2 cents per bushel per month, taking four months to add 10 cents to the price. Wheat is somewhat different, and the price of wheat is raised 5 cents per month until July. Rice is raised 10 cents a month from September until the following April, at which the price remains the minimum for the balance of the year. If you take the record of the markets, say, at

January 30 for delivery May, 1922, you will find that oats was at 394, while for May in my schedule it would have brought 40 cents, or one-half cent more. Corn, January 30, was 54 cents for May delivery, just one-half cent different from my schedůle number. Wheat on January 30 was at $1.19, 11 cents less than my schedule. I simply bring this matter to your attention to show that the schedule is not far out of actual prices at the present time.

The next thing I wish to draw your attention to is this: These prices are to the farmer wherever he may be. "Supply and demand" and speculation may give higher prices. Take the prices for the past 15 years, and the above table is very similar. The question of freight and location does not enter into this plan. For example, the farmer at Rock Rapids, in Lyon County, Iowa, would get as much for his grain as the farmer at Keokuk, Iowa.

I wish to say that the valorization bill in Brazil on coffee has fixed the minimum price of coffee and saved the farmers, planters, and bankers from absolute ruin. The effect of this bill would make it so that the farmer was not forced to glut the market at any time, but could hold or borrow upon it until such times as condition permitted. I inclose herewith a caption for House file, and I would like if you would give this matter your earliest attention and if possible bring it before Congress at as early a date as convenient. There being no money required nor guaranties necessary, it should not be difficult to get Congress to pay some definite attention to it.

Very truly yours,

ALEX PEDDIE.

THE ALEX PEDDIE SCHEDULE OF MINIMUM PRICES OF AGRICULTURAL PRODUCTS

EFFECT OF BILL.

Farmer.-Gives him a minimum price he will receive. Makes it so he does not need to hurry to sell any month. If cars can not be got one month, can carry over to next. Can borrow to advantage on grain security. Would know what rent he could ask for land. Tenant would know what rent he could pay. Would know what price to pay for a farm. Would tend to increase prices of butter, hogs, cattle, sheep. Would give the farmer the confidence he needs.

Banker. Would have a basis on which to figure loans. A knowledge that he would not lose by giving credit. Would make collections easier and more definite.

Millers.-Would know that they must buy early (thus increasing the demand and raising price above the minimum). Would help the local miller.

Speculators. Could speculate all they want above the minimum.

Country merchants.-Could take pay in farm produce with the knowledge that they would not lose by doing so.

Cattle feeders. Could make contracts for corn, etc., and the earlier the better. Markets. Would be relieved of the bad effects of thousands of bushels being rushed in at one time.

Railroads.-Could make distribution of cars more easily and have longer time in which to make delivery.

I desire to call the attention of the committee to the plan, in brief:

1. That it is not a charge against the Public Treasury.

2. That it asks the Government to fix an average price, varying for the different months in the year, on four agricultural products.

3. That it does not fix a maximum price, but permits supply and demand to fix the price above the minimum fixed by the Government.

4. That it is the price fixed at the home market of the producer, the same as many commodities are now sold, like breakfast foods, at any distant point from the place of manufacture, at the same price per carton.

Objections have been made against the plan, on the theory that the minimum price will become the maximum price, and that there is no penalty provided in the suggested plan for violation thereof. It is the contention of the author of this plan that the minimum price can not be fixed as the maximum price, for the reason that supply and demand will vary the maximum price according to the condition of the trade; that no penalty clause is needed in such a bill, for the reason that the influence of the Government in fixing a minimum price is sufficient to compel an economic adjustment to where the price of such commodities would not go below the price fixed by the Government.

I trust that the committee will give this matter consideration when reaching a conclusion on a stabilization bill in the future.

COMMITTEE ON AGRICULture,

HOUSE OF REPRESENTATIVES, Washington, D. C., January 5, 1923.

The committee met, Hon. Gilbert N. Haugen (chairman) presiding.

The CHAIRMAN. We will hear Mr. Marsh first.

STATEMENT OF MR. BENJAMIN C. MARSH, REPRESENTING THE PEOPLES' RECONSTRUCTION LEAGUE AND THE FARMERS' NATIONAL COUNCIL, WASHINGTON, D. C.

Mr. MARSH. Mr. Chairman, I appear on behalf of the Peoples' Reconstruction League and the Farmers' National Council, and my headquarters are here in Washington.

Mr. Chairman, I am here this morning, not to discuss in any extended way the Little bill, but on behalf of Mr. Sinclair's bill to create the farmers' and consumers' financing corporation. That is a bill which has been indorsed by a great many progressive labor organizations, and by a great many farm organizations. Just about a week ago, or a little less, the Conference for Progressive Political Action, which, as you gentlemen know, is a combination of farm and labor forces, and which had some large influence in the election last November, met at Cleveland and adopted a very brief platform, not in the customary way asking for the consideration of so and so, but it was addressed to Congress on behalf of producers and consumers, demanding certain things. One of their demands was "the enactment of the Norris-Sinclair consumers' and producers' financing corporation bill, to increase the prices that farmers receive, and to reduce the prices that consumers pay for farm products, and the creation of an independent system of food producers' credits.

Mr. KINCHELOE. What organizations were represented in that conference?

Mr. MARSH. Mr. Kincheloe asks what organizations were represented in that conference at Cleveland, and I will say that practically every one of the 16 railroad men's organizations, with the exception of the Brotherhood of Railway Trainmen, was represented; also, the United Mine Workers of America; the Amalgamated Clothing Workers of America; the National Non-Partisan League; the Farm-Labor Union of America, the Farmers' National Council, and a number of smaller farm and labor organizations. They did this because they realized, all of them, the desperate condition of the farmers. I am going to take up a little later the question of whether this is putting the Government into business, and what the function of the Government is. I would like to state now, that from the figures we have been able to get―and I admit that this is only an estimate the farmers of the country lost approximately $4,500,000,000 last year, if you consider their business on the same basis that an ordinary commercial concern considers its business, to wit: That the farmer is entitled to a fair return upon his investment and to all expenses essential to production—that is, expenses like the purchase of fertilizer, seed, and things of that sort that he has to buy, and, also, farm equipment, machinery, and implements. That was his loss if you assume that he is entitled to that fair return upon his investment and to all expenses, and to a fair return for the labor of himself and the members of his family. Now, I admit that this is but an estimate. The Department of Agriculture prepared figures of farm expenditures for labor, fertilizer, and seed in 1919, but we have not those figures for 1922. They said that the total of the labor cost in 1919 was $1,356,403,452, including as the amount paid in cash $1,098,604,500; the value of rent and board furnished was stated as $257,798,862; the cost of fertilizer was stated at $326,399,800, and the cost of seed was stated at $1,097,452,187. I have not been able to bring those figures up to date.

Mr. WILLIAMS. Taking into consideration the cost of production of farm products, as enumerated there, has there been any year in the past when the farmers of the country as a whole have made a profit?

Mr. MARSH. I think that during the war years the farmers, as a whole, did make a profit.

Mr. WILLIAMS. But ordinarily, figuring the cost of agricultural production as the cost in other businesses is figured, has that production been at a loss?

Mr. MARSH. Ordinarily farm production is at a loss, and the only way in which the farmer can figure a profit is through the most disastrous thing in connection with agriculture, and that is through speculation in farm lands and through the work of himself, his wife, and children with practically no remuneration. Those two items are the only ones that make it possible for the farmer to so much as break even under normal conditions, or under our present system of distribution.

32018-23-SER O— —2d sup—G

Mr. TINCHER. A successful farmer's estate, at the time of his death, never exceeds in value, as a general thing, the increased value of his land during the time that he held it?

Mr. MARSH. I should think, as a general proposition, that that is true, but I would not want to assume responsibility for making that statement as a generalization. I think, however, that it would be approximately correct, by and large.

In discussing this bill, I want to refer to the identical bill, or the bill that was introduced in the Senate as an identical bill, by Senator Norris, the chairman of the Senate Committee on Agriculture. The Senate Committee on Agriculture made a few changes in it, which are not, however, vital. They do not affect the purpose of the bill, but somewhat affect its scope and the methods of administration. The most important change is one which provides that, instead of the Secretary of Agriculture being a director of the corporation to be known as the farmers and consumers' financing corporation, the board of directors shall consist of three members appointed by the President, by an with the advice of the Senate. Those are the princiapl changes, and there are some minor changes that would make the operation or the application of this measure a little more general than would be the case under the bill as first introduced by Mr. Sinclair and Senator Norris. I want to say frankly that this bill is not advocated by the organization on behalf of which I appear as a panacea or cure-all. We recognize it does not deal with the land question; that it does not settle the transportation question, and that it does not clear the way to afford any relief to the farmer with reference to financing his production. I would like to call to your attention a letter

Mr. JONES (interposing). Do you think that the amendment that the Senate committee has put on is a good one?

Mr. MARSH. Do you mean the one

Mr. JONES (interposing). I mean the one that strikes off the Secretary of Agriculture, and provides for a board of directors. instead of the Secretary of Agriculture?

Mr. MARSH. Frankly, I do not feel that that will make much difference in the administration of the measure. I am perfectly willing to admit that a measure of this sort has to depend for success largely-not exclusively, but largely upon the spirit of the man who administers it and upon the time that he can give to it. The Secretary of Agriculture is, of course, a very busy man. He is charged with numerous duties, and recently, or a little over a year ago, he was charged with the administration of the packer control act. I feel that quite naturally those gentlemen would work in hearty cooperation with the Department of Agriculture, and, therefore, I do not feel that the amendment would vitally affect the administration of this bill.

Mr. TINCHER. Before you leave the subject of this bill, let me say this: You are located here, and you know the parliamentary situation in Congress; you know that the object of this committee is to get legislation, and, if we can not get what we want, to get the nearest to what we want. I wrote you a letter inviting your attention to the fact that the Norris bill was under discussion on the floor of the Senate. Now, if the Senate should beat the Norris bill, I want to call to your attention something else that it would be practicable for us to report in place of the Norris bill, if it should be defeated in the Senate. Otherwise, in that event we would know that we could not get legislation. Have you gone into the Little bill so that you can say to the committee that, in your judgment, as a constructor

Mr. MARSH (interposing). As a what?

Mr. TINCHER. Whatever you call yourself. You are here on the job all the time and know what is going on. Now, would you favor reporting out the Sinclair bill, knowing that that meant we would have no legislation at this session, in preference to reporting out the, Little bill or something else along that line?

Mr. MARSH. Answering your question, which, as I understand it, is whether I would favor having this committee report out the Sinclair market bill, knowing that the House would not pass it

Mr. TINCHER (interposing). No; knowing that the Senate would not pass it.
Mr. MARSH. Knowing that it could not pass the Senate?

Mr. TINCHER. We will know whether the Sinclair bill or Norris bill will pass in a very few days, because I understand there is to be a vote on it.

Mr. MARSH. To your question, whether I would favor reporting it out, my answer is specifically this: I do not have to answer for what Members of Congress, or Members of the House of Representatives and Senate do. All that I can do is to keep very close tab on what is done by every Member of Congress in committee, and I do that as closely as I can, recognizing that the real test of a man's interest in a measure is not whether, when he sees that a bill is going through, he jumps in and votes for it, but rather how hard he works for the bill in committee and outside of committee.

Mr. TINCHER. I am not talking politics with you at all, but I am talking about the practical situation that confronts us. You know the parliamentary situation here,

and I do not care what you say about it in the country or what you say about what the committee does. That is something for you to address to your own conscience. I do not think that any member of this committee is particularly looking at that phase of it, but what we are confronted with is responsibility for legislation.

Now, I know and you know what is going on, and we know that if they can not put the Norris bill through the Senate, we can not pass the Sinclair bill and make it a law, because it is the same as the Norris bill. Therefore, I ask you, who claim to represent so many millions of farmers, and you also claim that the other farm organizations are corrupt, because I have your testimony on that in which you denounced the National Grange as being under the control of Wall Street, and, also, the Farmers' Union

Mr. MARSH (interposing). And I conclusively proved my statement though it didn't include the Farmers' Union.

Mr. TINCHER. So we have you here as the one simon-pure representative of the farmers, and I wanted to get your idea regarding this practical situation.

Mr. MARSH. I was trying to give it to you.

Mr. TINCHER. You went on talking about other things.

Mr. MARSH. No, sir. While I appreciate this coaching, and I realize how much I need it, I do feel competent to make an answer without having it written out in advance and told to sign it on a dotted line. If I may proceed, as I stated in the letter to all the members of this committee, quoting your statements, and I will read it right

now

Mr. TINCHER (interposing). Put the whole letter in if you put any part of it in. Do not put it in as you did before when you spoke of it.

Mr. MARSH. All that I left out was contained in the last four lines, and it was nothing at all that was pertinent to the question. This is the part that was omitted: "Colonel Little, of my State, has a bill which he is very much wedded to, which I would commend to your consideration, as the committee has voted to notify you when you could be heard on these matters."

That was not germane to the measure, so far as I could see.

Mr. TINCHER. Do you mean that the Little bill is not germane to the agricultural interests?

Mr. MARSH. No, sir; it is not tied up necessarily with the Sinclair market bill. Mr. TINCHER. You would not want to pass both the Sinclair bill and the Little bill, would you?

Mr. MARSH. I think the Sinclair bill would cover the subject matter. The Little bill does not begin to touch a number of subjects involved in this, nor does it provide the machinery for meeting the situation that is provided in the Sinclair bill.

Mr. TINCHER. Then, in answer to my question, you say you would not approve the passing of both the Sinclair bill and the Little bill?

Mr. MARSH. I would feel that it was unnecessary, and it would probably make the situation more difficult. Let me get this right into the record, because I never dodge a question. I do not believe that the Senate has the right to hide behind inaction on the part of the House, nor that the House has the right to hide behind inaction on the part of the Senate. Every Member of the United States Senate and every Member of the House of Representatives is responsible to his constituents and to the general public for his actions.

Mr. ASWELL. You are not answering the question. Nobody asked you about hiding behind something. Mr. Tincher asked you a practical question, and you have not touched it in your answer.

Mr. MARSH. Well, if you wish, I will answer it in this way: If you have no responsible organization of the majority party, so that you can get through before the 4th of March legislation that the farmers of this country want, why, I should say, that that party would have to take full responsibility for it at the time when parties are held to strict accountability, to wit, in the election.

Mr. ASWELL. Mr. Tincher's question did not touch upon politics.

Mr. TINCHER. This committee has had no trouble, since I have been on it, in passing any legislation that it has reported favorably to the House, or any general legislation it has reported. We have had no trouble in getting consideration for such legislation, nor in getting it passed, but there is a difference between men who want to do things and men who want to talk about doing things. It would be the height of folly for this committee to report out a bill that had been killed by the Senate and put it on the calendar of the House, because we would know that all that we could gain by doing that would be to enable us to go about the country with a propaganda that we had tried to do something, when we knew that the bill could not pass the Senate.

Mr. VOIGT. Are we not wasting a lot of time with this discussion, and is not that a matter for this committee to determine, and not for Mr. Marsh to determine? I would like to know what he has to say about the merits of these bills.