When practicing law I was advised never to take a group of farmers on a jury having to do with gunshots because each fellow was an expert, and I still don't think that I would want my name on any general farm bill I could ever get through Congress for it would be changed so in getting it through, it would not reflect my views. I will do the best I can to help the cause, but I do realize that there are so many different views, so many conflicting economic interests that it would be next to impossible to do anything more than the best one could.

But coming back to the question, I grant, I have seen many, many instances where individuals can make more money in a year of scarcity than they can in a year of plentiful production. One of the reasons for it is that they don't have the cost of harvesting the extra crop, the cost of transportation, and the available production goes to the smaller group of consumers who can pay the price, whatever

it is.

I recall in President Roosevelt's day that he cited the illustration of a workingman in Baltimore who came to see him, a man whom he had known. This fellow was complaining that prices had just gone sky high, that he paid 50 cents for a little box of strawberries in February. The President said, "How in the world did you ever get where you could afford strawberries in February?" I point this out to illustrate that when the supply is limited it goes to the relatively small number of consumers who can pay the price.

Certainly I know you strive and of course we strive to insure a supply adequate to meet the needs of the consuming public and at the same time keep the producer's returns on a level with other Americans having the same risks, the same investment, the same energies, and all that.

QUESTION AS TO FAIR RETURN TO THE FARMER FROM THE MARKET

OR THE TREASURY

Now, I come to this question. Once, using cash payments, you bring production in line and have only an adequate carryover, is the farmer going to get his fair income at the marketplace; is he still going to have to look to this Government payment; or is the Government payment a temporary means to bring about an adjustment between supply and demand?

Secretary FREEMAN. Well, I would hesitate to answer that question very clearly and sharply because I don't know. Once we relieve the market from the pressure of the heavy surplus acquisitions, combined with our goal of finding alternative uses of land-which is why the rural areas development program is more than a relief program; it is a basic economic program-we would look to the combination where we would have a balance of the economic factors in the marketplace that would make a continuation of any kind of payments unnecessary, and we would look toward the development of various kinds of self-help programs as our producers become a bit more knowledgeable, let us say, in terms of the market and the marketplace, in what they can do, they will be able to develop some muscle of their own without Government assistance, be it price supports or allotments or whatever.

95547-63-pt. 1

This is the direction we seek to move. How rapidly we can do it is a matter of conjecture.

Mr. WHITTEN. The members of this committee have heard this and it has been printed so much that I apologize for saying it. The old story about all anybody wants is a fair advantage, and the easiest way to have an advantage is to pass a law. I have said many, many times, that is the history of the Congress-declaring advantages fair by law.

We deal with agriculture in a country where many, many things have been declared fair by law. For instance, several years ago record indicated that since World War II there have been 13 freight rate increases. In the last 10 or 12 years there have been tremendous increases in wage rates and retail costs of tractors and farm equipment, and all of those things.

When industry has to, of necessity, make its markup on top of its costs which include raw material and labor, agriculture, in my opinion, cannot be handled as a thing apart. For that reason I have little patience with individuals or organizations, farm organizations and others, that talk about freedom of the farmer to sell for what he can get, when he has to buy in a market where the retail price he pays is fixed and greatly increased by these other laws.

I am not condemning anything that is in law. I have been here long enough to know that what has happened is going to continue and probably going to get bigger and bigger. But I am trying to be a realist and say those things are in law, which means that agriculture of necessity must be dealt with in relationship to cost, volume, and what happens in these other areas.

That is the reason I was in hopes that your desire and your objective was to reach the point where the farmers' fair return would come from the marketplace as part of the price paid. If we ever let the farmer have to look to the Treasury as other elements gradually take up the whole consumer retail dollar, it puts the farmer where he more and more has to look to the Treasury. In the end, as I see it, he would be looking entirely to the Treasury. As somebody said, I don't know that that saves the American people too much, because consumers and taxpayers are just about one and the same. I wouldn't say that some of your biggest taxpayers consume that much, but some of your smaller consumers pay that much more tax comparatively.

So I don't believe we are solving anything if we ever let the relationship between the three get out of line. That is the reason I have always believed in this parity concept. I believe in it now.

So I come back to the question that I would hope you and your planners and we have to have planners, in spite of what some people say in the press sometimes could see somewhere down the line where the farmer could look to the user of his product for his fair return as against being continuously dependent on cash payments out of the Treasury.

AGRICULTURAL RESOURCE USE ADJUSTMENT

Secretary FREEMAN. Well, I have tried to set down in this statement, Mr. Chairman, exactly what you are asking, and I think it will be accomplished if we can do it through the realinement of the amount of resources going into the production of food, fiber, and shelter.

Now I think we have got to recognize two things here as a part of the overall complex of this business that is unique to agriculture. In the first place, the productivity in agriculture has gone up substantially faster and it is continuing to go up faster than in industry. The output of the average agricultural worker, as you well know, in the last 10 years has increased three times as fast as industry, No. 1. No. 2, that demand is very inelastic. You can buy 10 cars and 10 motorboats and 10 houses and 100 suits of clothes if you can afford to pay for them, and more and more people can, but you can't eat 10 meals a day or you are not long for this world, and so you have a strict limit on consumption.

So you have on the one hand the ability to produce more and more with fewer people on less land, and the ability to consume that amount does not go up at all commensurate with the ability to produce it.

So you have a pressure here, an imbalance between supply and demand in agriculture greater than you have basically in industry. That is another facet of it.

The only answer to this aside from long-term Government programs to equalize it in a variety of ways, as I have mentioned, is fundamentally to move some of the resources that today are producing food and fiber into producing alternative things that are needed and that people want and that they are willing to pay as much or more for, with the income of the farmer and people in rural America being accordingly benefited and the needs and uses of people in urban America being satisfied.

Now to do this and accomplish this basic realinement of resources, of land and water and their use, in a free society where you just can't order it done, per se, takes a lot of doing.

But this is what I look down the road to our seeking to accomplish, and I think it is a perfectly rational, sensible goal to seek, and one that we can accomplish; but it is going to take a lot of doing.

Mr. WHITTEN. Mr. Secretary, doubtless you may be right, and I am oversimplifying it, putting it in too few words. But by and large, I can't follow you. I certainly agree with your sincerity and your high hopes, and I would hope that perhaps you are right.

But again it would appear to me, stressing that phase of it, it merely means that folks out in the country are going to serve as entertainers for the city people, and the folks who do that are not contributing in any great degree to present commercial production, nor are they contributing greatly in a farming way.

Now I wouldn't take a back seat to anybody as to the importance of seeing that that group of Americans, of which there are many, have a reasonable income and a reasonable chance. However, I don't believe that is touching near so much as you believe the major problem which we have in the agricultural area.

Secretary FREEMAN. Well, might I just make a specific illustration? Mr. WHITTEN. The more I ask, the more answers you have a chance to give. So don't hesitate to enlarge them in the record.

Secretary FREEMAN. Thank you.

I spoke to the national plowing contest last fall close to Dayton, Ohio. I drove from the airport with the director of agriculture of the State of Ohio. Along the highway we went by a farm and he pointed out to me that this farm was a 350-acre farm, a corn-hog operation

owned by a very prosperous farmer, and that this man had taken 50 acres out of producing corn and was using it as a farm pond in which he had planted fish-people were fishing as I observed it-and where he was making twice as much per acre from that farm pond with people standing around fishing on it than he was making producing corn. And he was not producing corn that we don't need, because we don't need all the corn we can produce. We have no use for it. Very frankly, we have no place to put it, and we can produce more than we can use, and if we went ahead we would drive the price down to 70 or 60 cents if we just let it go.

But he was meeting a need that people wanted, to get outside and fish, if you will, and he was getting paid more for it, and this served both an economical and social purpose in my book. I saw nothing degrading about having 300 acres and running a fishpond and people paying for it, as distinguished from running 350 acres and producing corn you don't need.

Mr. WHITTEN. That is a good illustration. I had a man in my district some years ago, I would like to cite him as an illustration of diversified farming. He had rice, dairy cattle, beef cattle, cotton, corn, and soybeans, and had 40 acres in goldfish. This was quite some time ago.

WAGE AND TRANSPORTATION RATES AND AVERAGE PRICES FOR VARIOUS FARM COMMODITIES

I can see that aspect of it. I think for the benefit of the discussion that we are presently having, you might have Mr. Grant supply for the record how many freight increases we have had in the last 10 or 12 years, whatever period is easiest to deal with, what changes there have been in minimum wage laws, the average wage contracts, and the average price for various farm commodities, so we can see a composite of it.

(The material requested follows:)

STATEMENT ON MINIMUM HOURLY WAGE RATE

The minimum hourly wage under the Fair Labor Standards Act was 75 cents in 1950. Coverage was limited largely to workers in plants whose products move in interstate commerce. Workers in agriculture were excluded. On March 1, 1956, the minimum wage was raised to $1 per hour but coverage was essentially unchanged. Amendments to the act in 1961 extended the coverage to 3.6 million new workers (from 24 million) and provided for raising the minimum wage in steps to $1.25 per hour. The minimum wage for those covered before September 1961 was raised to $1.15, and an increase to $1.25 is scheduled for September 1963. The 3.6 million new workers-largely in wholesale and retail trades-are to receive a minimum of $1 per hour until September 1964 when the minimum will be raised to $1.15, and to $1.25 September 1965.

products.