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the custody of agricultural commodities shall give bond in such amount, with such penalties and upon such terms as the interstate association shall determine; (h) May accept the services of any person without compensation;

(i) May adopt, amend, and repeal regulations;

(j) Shall have such powers not specifically denied by law as are necessary and proper to conduct, under this act and in accordance with approved business methods, the business of cooperatively processing, preparing for market, handling, storing, and marketing agricultural commodities, or such further business as is necessary and incidental thereto.

SPECIAL POWERS

SEC. 3. The interstate association is authorized

(a) To provide or approve systems of accounting for local and State organizations organized under Title II;

(b) To provide a system of reporting and disseminating crop and marketing information for the benefit of such organizations;

(c) To advise the members of such organizations as to the diversification of production of agricultural commodities and as to the increase or decrease of production necessary to provide an adequate supply of the commodity without causing either an undue surplus or shortage of production;

(d) To determine, subject to the approval of the members, upon the annual budget and necessary supplements thereto, of the receipts and expenditures of the association;

(e) To provide for the commodity assessment against State associations of fees sufficient (1) to meet the expenditures of the interstate association authorized in any approved budget, (2) to repay all loans and interest thereon provided for in section 301, and (3) to establish a reserve fund in such amount as the members of the interstate association determine to be necessary to enable it most effectively to execute the functions vested in it by this act;

(f) To acquire, construct, maintain, and dispose of, or acquire the rights of operation of (1) storage warehouses for agricultural commodities, (2) facilities for transportation (otherwise than as a common carrier) in connection with the storage of such commodities, and (3) facilities for processing such commodities

BOARD OF DIRECTORS

SEC. 4. (a) Except as otherwise specifically provided the board of directors (referred to in this act as the "interstate board") to be composed as hereinafter provided in this section, shall direct the exercise of the functions vested in the interstate association.

(b) The first board of directors shall be composed of four members, one of whom shall be a fiduciary officer of the United States designated by the President, and three of whom shall, within one month after the enactment of this act, be elected from their own number by the incorporators named in section 1. Of the three elected members of the board of directors, one shall be elected for a term of one year, one for two years and one for three years. A successor to the director designated by the President shall be likewise designated by him. Successors to the elected directors, except those elected to fill unexpired terms of directors, shall be elected for a term of three years by the members of the interstate association in the manner provided in section 7.

(c) A vacancy in the office of an elected director may be filled by the remaining directors until, at the next annual meeting of the members of the interstste association, a successor is elected to fill the unexpired term of such office and is qualified. Any such vacancy shall not impair the powers of the remaining directors to execute the functions of the interstate board. A majority of the directors shall constitute a quorum for the transaction of the business of the interstate board.

(d) Each elected director shall receive a salary to be fixed by such members and shall hold office until his successor is elected and qualified.

(e) The director designated by the President shall not receive compensation from the association for his services as director, other than pay for expenses incurred by him while acting as a director, and upon repayment by the interstate association of the loan and interest thereon provided in section 301, his term of office as director shall be terminated.

(f) There shall be but three elected directors, unless by a two-thirds vote of the charter members of the interstate association such number is increased, but at no time shall the number of directors exceed eleven.

MEMBERS OF INTERSTATE ASSOCIATION

SEC. 5. The incorporators named in section 1 shall be the first members of the interstate association. The three incorporators first listed in section 1 shall be members for a period of three years; the next three listed, for a period of two years; and the five last listed, for a period of one year, beginning from the date of incorporation of the association. Successors to the original members, except those elected to fill unexpired terms of members, shall be elected as provided in section 203 for periods of three years.

(b) A vacancy in the office of any member may be filled for the unexpired term of such office by election as provided in section 203.

COMMENCEMENT OF OPERATIONS

SEC. 6. The interstate association (1) shall begin its operations under this act in respect of such agricultural commodities as it considers best adapted to national cooperative marketing, and (2) shall, so far as as it deems practicable, utilize such existing cooperative associations and other marketing agencies as are immediately available and capable of use for the purpose of this act.

DUTIES OF MEMBERS OF INTERSTATE ASSOCIATION

SEC. 7. It shall be the duty of the members of the interstate association(a) To convene as provided by regulations at the call of the interstate board and at a place to be selected by it;

(b) To elect annually directors to the interstate board;

(c) To act as an advisory group on behalf of the associations and to supervise generally the operations of the interstate board;

(d) To fix the salaries of the directors of the interstate board, and approve, with or without modifications, or disapprove the annual budget of the association and necessary supplements thereto;

(e) To prepare a schedule of commodity assessments which, when approved by the interstate board, may be levied by the State associations upon their member associations.

BRANCH OFFICES

SEC. 8. (a) The interstate association may establish such agencies or branch offices at such places as it deems advisable.

(b) The interstate association shall be held an inhabitant and resident of the District of Columbia within the meaning of laws of the United States relating to venue of civil suits and of offenses against the United States.

BOOKS

SEC. 9. The interstate association shall keep, at its principal office in the custody of its secretary, correct books, showing the original or a transcript of the minutes of the interstate board's members' meetings, and showing the accounts of the association's business transactions.

ANNUAL REPORT

SEC. 10. The interstate association shall make an annual report to the Congress in respect of all loans made under authority of section 302 until such loans are repaid in full with interest.

TITLE II-STATE COOPERATIVE MARKETING ASSOCIATIONS

ORGANIZATION

SEC. 201. In order to carry out the functions vested in it by this act, the interstate association is authorized to provide for the organization of State cooperative marketing associations (referred to in this act as "State associations") in the several States. The interstate association shall by regulation, not in conflict with the laws of the State, prescribe the form of organization in each State whether by incorporation, contractual agreement, or otherwise.

DUTIES OF STATE ASSOCIATIONS

SEC. 202. Each State association shall

(a) Annually select a board of directors which shall direct the operations of the association;

(b) By its board of directors annually select an individual as its representative to an annual convention of representatives of State associations;

(c) Organize as members of, or admit to membership in, such association any local cooperative association included within the provisions of the act entitled "An act to authorize association of producers of agricultural products," approved February 18, 1922.

ELECTION OF MEMBERS

SEC. 203. The individuals selected in accordance with section 202 as representatives of the State associations shall convene annually, at a place designated by the interstate board, and shall elect the members of the interstate association. Each representative shall have but one vote which shall be cast in person.

REGULATION OF STATE AND LOCAL ASSOCIATIONS

SEC. 204. (a) The interstate association is authorized to prescribe regulations requiring(1) The adoption by local and State associations of systems of accounting approved by the interstate association;

(2) The use by the local and State associations of systems of reporting and disseminating crop and marketing information provided by the interstate association;

(3) The use by local and State associations of approved forms of agreement under the terms of which a local association is admitted to membership in a State association;

(4) The use by local associations of approved forms of marketing contracts to be subscribed to by the members of local associations;

(5) The use by local and State associations of grades and standards, not in conflict with law, of the commodities to be marketed through the State association and the interstate association, and the use of methods of packing and storing such commodities that have been approved by the interstate association;

(6) The payment by the State association of the commodity assessments fixed by the interstate association under section 3;

(7) If the interstate association finds by a vote of two-thirds of its members that any State association, or any local association which is a member of a State association, has failed to comply with any regulation prescribed under this section, the interstate association shall adopt a resolution publishing such finding. Upon the adoption of any such resolution the State association shall be ineligible, for such period of time as the interstate association may designate in the resolu tion, to obtain any loan provided in section 302, to be represented at an annual convention of representatives of State associations, or to obtain the exemptions accruing to it by reason of the benefits of section 302, except that if the violation is that of a local association, the State association shall not be held ineligible under this subdivision if, within thirty days after the adoption of the resolution, the membership of the local association in the State association is terminated or suspended for such period of time as the interstate association may designate in its resolution.

OPERATING ZONES

SEC. 205. For the purpose of facilitating the marketing of any agricultural commodity, State associations engaged in the marketing of such commodity, within such zones as the interstate association may designate, may consolidate their marketing operations in respect of such commodity. For the purposes of carrying out such consolidated marketing operations, the State associations may jointly contract with or establish such organizations as they deem advisable.

TITLE III-MISCELLANEOUS PROVISIONS

LOAN FUND FOR ORGANIZATION PURPOSES

SEC. 301. There is hereby authorized to be appropriated, out of any money in the Treasury not otherwise appropriated, the sum of $10,000,000, which, as appropriated, shall be set aside and reserved as a revolving loan fund in the

Treasury, available to the interstate association until December 31, 1935. Payments shall be made from such fund at the direction of the director designated by the President upon application therefor by the interstate board, shall bear interest at the rate of 4 per centum per annum until repaid from commodity assessments fixed by the interstate association.

USE OF FUND

SEC. 302. (a) The moneys in such fund shall be available for loans (1) to the interstate association for administration expenses of such association including expenditures for the organization of State associations, and (2) to a State association for expenses incurred by it in its organization, or in the organization by it of local associations which are members of the State association.

(b) The interstate association shall prescribe regulations in respect of the repayment to or collection by the interstate association of all loans made under subdivision (a). All moneys repaid to or collected by such association shall be covered into such fund.

APPLICATION OF ANTITRUST LAWS

SEC. 303. The interstate association and State associations shall, for the purposes of this act, be deemed marketing agencies within the meaning of that term as used in the provisions of the first section of the act entitled "An act to authorize association of producers of agricultural products," approved Fenruary 18, 1922, and in the same manner and to the same extent as associations included in such act, shall be subject to the provisions of section 2 thereof.

COOPERATION WITH EXECUTIVE DEPARTMENTS

SEC. 304. To foster, encourage, and promote the cooperative processing, preparing for market, handling, storing, and marketing of agricultural commodities under this act and to assist in the establishment and maintenance of State and local associations, any Government establishment in the executive branch of the Government shall, in accordance with the written request of the interstate association to the head of such Government establishment, cooperate with such association or with any State association to such extent as the head of such Government establishment deems compatible with the interests of the Government.

SEPARABILITY OF PROVISIONS

SEC. 305. If any provision of this Act is declared unconstitutional or the applicability thereof to any person or circumstances is held invalid, the validity of the remainder of the Act and the applicability thereof to other persons and circumstances shall not be affected thereby.

RESERVATION OF RIGHT TO AMEND

SEC. 306. The Congress of the United States reserves the right to alter, amend, or repeal the provisions of this Act.

Mr. ASWELL. Mr. Chairman, the committee is assembled to hear Mr. Yoakum.

The CHAIRMAN. Yes; we will hear Mr. Yoakum now.

STATEMENT OF MR. B. F. YOAKUM, OF NEW YORK CITY

Mr. YOAKUM. Mr. Chairman, do you wish a discussion of the bill by me, in a limited way?

The CHAIRMAN. Just proceed in your own way, Mr. Yoakum.

Mr. YOAKUM. Farming with me has been a subject of long study, beginning with my days of railroad construction, when I built largely through sparsely settled countries, west and southwest of St. Louis and Kansas City. It was through those unsettled countries, where it was often fifty or seventy-five to a hundred miles between houses,

I gave a great deal of attention to the development of those countries, realizing and knowing that the farming industry was the best tonnage producer and a good revenue payer. I gave a great deal of attention through all the departments of railroad construction and management to the encouraging and upbuilding of the farming industry. They were lines of considerable mileage and of importance. Of .course, it goes without saying that it was a selfish interest on my part, for the reason that I needed the tonnage and the farm was the best way to get that tonnage, through the development of the farming industry, as I have stated. I pursued that interest in farming for many years. It is rather interesting to me to read the articles and speeches which I made 15 years ago along the same line of thought that I am now following out. I tried very hard, in my way, to bring the farmers and the business interests together. The business interests had several meetings and the farmers had several meetings. I attended in those days a great many farm conferences, and in my own way discussed different questions with the farmers. I found the farmer, as I find him to-day, always willing, or he expresses his willingness-I mean the farm organizations-to join and cooperate in every way they could consistently with the business of the country and the business interests.

The business interests, however, and the banking interests were always occupied in a more lucrative business and more attention was paid to that, and they did not respond as freely and as liberally as the farmers to the suggestions that I made and undertook to carry out.

Three years ago, or a little over, realizing, looking ahead and realizing the condition that the country was drifting into, and the poverty stricken condition which the farmer was approaching, I took the question up very carefully. I went into every detail. I went into it with a view of trying to locate the fundamentals. I knew they were somewhere. In my first work I sent representatives to the various market centers, the large industrial centers, where the question of the food supply was an absolute necessity every day with the inhabitants of those places. I have tried to avoid fooling myself. I have no interest in this further than as a citizen. I have no expectation of getting anything from it or hope of future reward; but I did believe, and I do believe to-day, that the fundamentals that I have developed and put into general form in my various articles and talks are the fundamentals we have got to have established. In the investigations that I have just referred to I discovered there are one and three-quarters farmers to one food dealer; that is to say, taking it as I have carried it out in population, 34,000,000 farm population and 19,000,000 food dealer population; that is, people interested in the sale of food in some way.

That was the first basis of the investigations that I have pursued for three years. On prices, it is an established fact, from all kinds and sources of information, that the farmer is not receiving more than one-third of the dollar paid by the consumer.

There are many cases-in regard to the many cases that I have made, I know that I have investigated hundreds in different sections of the country, where the consumer has paid from 300 to 500 per cent more than the farmer received. I have made trips through the country, I have gone into the fields, I have talked to the farmers and ex

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