Thus, if this bill was passed, NFO could not only threaten illegal and coercive actions against livestock markets, but it could do so without fear of retaliation from those whose rights it violates. No more illogical or unjust situation could be imagined, and it would be a travesty if Congress could be bilked into the passage of such legislation under the guise of "protecting the small farmer.” In short, we oppose this bill because there is utterly no justification for it in the livestock industry; because it is being sought by those who don't need it with motives to say the least suspect: Farm Bureau; and because it would be a measure of protection for NFO, whose avowed purpose is to destroy the open, competitive marketing system which exists today, and who has engaged in known acts of coercion and discrimination in the livestock marketing industry in recent years. We suggest that this is simply a bad bill and should be defeated, but at the very least, it should be so worded as not to apply to the livestock industry. This can be readily accomplished by the addition of the words "except livestock" to the words "agricultural commodities" wherever they appear in this bill. I shall be happy to answer any question which any member of this committee may wish to ask concerning any of the matters about which I have testified. Senator AIKEN. Tomorrow the committee will meet at 10 o'clock to hear about six or seven other witnesses. (Whereupon, at 12:05 p.m., a recess was taken until Thursday, June 16, 1966, at 10 a.m.) DISCRIMINATION AGAINST MEMBERS OF FARMER COOPERATIVES THURSDAY, JUNE 16, 1966 U.S. SENATE, SUBCOMMITTEE ON AGRICULTURAL RESEARCH Washington, D.C. The subcommittee met, pursuant to notice, at 10:10 a.m., in room 324, Old Senate Office Building, Senator B. Everett Jordan (chairman) presiding. Present: Senators Jordan of North Carolina and Young of North Dakota. Also present: Senator Aiken. Senator JORDAN. Good morning, ladies and gentlemen. The subcommittee will come to order. Mr. Healy, I believe you are first. I appreciate your waiting over until today so we could hear some of those out-of-town witnesses yesterday. You may proceed as you wish. Do you have a prepared statement? Mr. HEALY. Yes, sir. STATEMENT OF PATRICK B. HEALY, ASSISTANT SECRETARY, NATIONAL MILK PRODUCERS FEDERATION Mr. HEALY. Mr. Chairman, I am Patrick B. Healy, assistant secretary of the National Milk Producers Federation, 30 F Street NW., Washington, D.C. The National Milk Producers Federation is a national farm organization. It represents dairy farmers and the dairy cooperative marketing associations, which they own and from which they do business throughout the 50 States. We appreciate this opportunity to express our views with reference to S. 109, a bill to amend the act authorizing associations of producers of agricultural products, approved February 18, 1922. Very briefly, the purpose of this bill is to allow farmers to associate together cooperatively to improve markets without being subject to interference, discrimination, coercion, or intimidation on the part of those doing business in agricultural products and who resent activities among farmers to improve their own markets through cooperative action. I might digress from my statement at this point to tell you that the federation is an association of some 800 dairy cooperative associations located all across the country. Therefore, we know the value of co operatives, and the purpose that they serve in marketing farmers produce. The Capper-Volstead Act, very wisely, established a policy under which farmers could band together through cooperative associations as a means of improving their own positions in the market. Over the years, farmers have made substantial gains through the formation and operation of cooperative associations. Today, the volume of farm products marketed cooperatively is impressive. The very fact that farmers voluntarily finance their cooperatives and support them is evidence of their worth. The cooperatives are engaged in many segments of the market. In the case of milk, some cooperatives process and distribute fluid milk and other dairy products. In other instances, cooperatives process manufactured dairy products which are distributed through their own sales agencies, or through other distribution channels. Many cooperative associations market bulk milk to processing plants. This type of cooperative has accomplished a great deal in improving efficiencies in marketing, and improving the price structure. Although farmers cooperatives have been generally recognized as legitimate business, there still are those who refuse to deal with cooperative marketing associations, or those who use every effort to prevent farmers from joining such efforts on their own behalf. The purpose of S. 109 is not to require any processor to purchase products from organized producers, but rather to prevent such a processor from interfering with attempts of farmers to organize and develop cooperative marketing associations. This bill would make it unlawful for any processor, handler, distributor, dealer, or agent thereof, who purchases or contracts agricultural commodities, from interfering with efforts by farmers to join and belong to cooperative associations to improve their own marketing structure. Passage of this bill would not increase the cost to the Government for agricultural programs, but would be another important step in encouraging farmers to make self-help efforts to improve their own position in the market through cooperative organization. Although the National Milk Producers Federation is in agreement with the purposes and objectives of S. 109, we would like to see this legislation set up as an independent act with enforcement in the Department of Agriculture, if that can be worked out, and, if not, then in the Federal Trade Commission, under procedures which would be relatively more flexible and which could operate more quickly to provide relief. We shall be glad to work with the staff of the committee or any of its members in this respect and offer our full cooperation. Federal legislation of this type is needed, and we urge its further development and enactment. Now, in that regard, Mr. Chairman, I would like to add that we are in complete agreement with what is being attempted by this bill and we have worked with the sponsor and with some of the other people interested in it in attempting to develop it so that it could work toward its purpose in the best possible way. We are not sure that we have caught everything that should be developed in this type of legislation. We have, therefore, prepared another bill which we would like to put before the committee for its consideration, and in putting this before the committee, we are not saying that it is better than S. 109. We are merely saying that it attacks the problem from a different viewpoint and perhaps in its discussions and in its consideration of this problem the committee might like to give consideration to some of the things that we have included in this new draft. We have prepared this draft bill aimed specifically at cooperatives because in the last analysis, we believe that the cooperative is the best tool that the farmer can have working for him in the marketplace and if farmers would organize themselves cooperatively, they would have more bargaining power. When they attempt to do it, then, of course, something such as is suggested by S. 109 is needed for their protection. Therefore, we have been more specific in our draft in aiming it directly at the cooperative. In the last analysis, the bargaining must be done through the cooperative. In the last analysis the greatest protection to farmers can be provided through protection to the cooperative. So we do offer this for your consideration. Senator JORDAN. You may leave it and we will study it. We will not go into it now at these hearings. Mr. HEALY. No. We would be very happy to work with the staff or with the members in its regard. Senator JORDAN. I would not want to make that a part of the record. Mr. HEALY. No, sir. I am not offering it as part of the record, merely as a paper for your consideration. Senator AIKEN. Refer it to the staff. Senator JORDAN. Right. Mr. HEALY. Yes, sir. Senator JORDAN. Senator, I am mighty glad you got here. You have been mighty faithful in all these hearings. Mr. Healy is the first witness and we have been glad to have him with us. Do you have any questions of Mr. Healy? Senator AIKEN. No. Senator JORDAN. Are you Mr. HEALY. Excuse me. This is Mr. M. R. Garstang, general counsel of the federation. Senator AIKEN. We have a good idea of what the trouble is. Senator JORDAN. Thank you, Mr. Healy. Mr. Garstang, glad to have you with us also. Senator JORDAN. Mr. Naden and Mr. Hampton, we are glad to have you with us this morning. Mr. NADEN. Thank you, sir. Senator JORDAN. Do you have a prepared statement? Mr. NADEN. We do. Senator JORDAN. You may proceed as you wish. Mr. NADEN. Thank you, sir. STATEMENT OF KENNETH D. NADEN, EXECUTIVE VICE PRESIDENT, NATIONAL COUNCIL OF FARMER COOPERATIVES Mr. NADEN. I am Kenneth D. Naden, executive vice president of the National Council of Farmer Cooperatives. The national council is a nationwide federation of farmers' business associations engaged in 6.5-374-66- -8 |