Mr. HUSSEY. That is not understood by the average consumer. They just said, "Here is a farm program which has brought about an enormous increase, and the United States Treasury had to step in and bail out."

The indicated acreage for 1948 is 2,162,000 acres. To me this indicates that growers are willing to accept a more or less voluntary acreage allotment program. I think nearly all growers realize that acreage must be brought into line with prospective needs. Growers are so widely scattered that it is virtually impossible for them to plan a potato acreage to provide the necessary crop without some help and guidance from a Federal program.

I would like to add here that after we received word of this opportunity to testify here before the committee, I met with as many farm groups as possible. I called together, in short order, the Farm Bureau, Potato Industry Council of Maine, the representatives of the Field Branch of the Production and Marketing Administration, the chairman and one of the members of the committee involved in administering the research and marketing program under the Flannagan-Hope bill, and two or three representatives of county and State organizations, to discuss this testimony.

I wanted to come here with some background of support for this testimony.

The recommendations which follow stem from that meeting.

The CHAIRMAN. You had no difficulty in coming to an agreement on these recommendations?

Mr. HUSSEY. No; we did not, Senator.

The first recommendation is to provide the potato-growing industry with price protection which is so vitally needed and necessary to continued solvency of the potato farmer, and at the same time (2) to afford this price protection on a permanent, orderly footing at a reasonable cost to the Government.

My thought is to frame a program based upon the experience we have had for many years with the program in effect for other agricultural commodities and to draw upon the experience we have had recently with potato surpluses and price support under the Steagall amendment.

The first step would be to authorize the Secretary of Agriculture to support the price of potatoes at from 60 to 90 percent of parity. If conditions are such that such support is undertaken at from 60 to 70 percent of parity, spotted surpluses which may develop should be removed by Government purchase and diverted to institutions and to industrial or livestock feed uses.

If, however, it should be necessary or appropriate to support prices at a higher level-say, from 71 to 90 percent of parity-this should be done only if a clear majority of potato growers vote in favor of measures to assist in accomplishing such price support. Of course, if growers as a whole do not vote to adopt measures for such assistance, no price-support activity would be expected.

These measures of assistance would be as follows:

(1) Establish a national acreage allotment sufficient with normal yields to provide for our needs, plus expected exports, plus a cushion for safety in the event of low yields;

(2) Break down this national allotment through States and counties to set an acreage allotment on individual farms;

(3) Provide for a marketing quota for each farm based upon the farm's acreage allotment;

(4) Give the Secretary of Agriculture complete control over disposition of potatoes produced in excess of the farm's marketing quota. This control may be in the form of a penalty, outright prohibition to market the excess, and denial of price support to the grower on his quota potatoes. In any event, it must be a strong penalty measure in order to deny advantage to a grower who hopes to profit at the expense of the Nation's industry;

(5) Provide, in the event of abundant yields, for mandatory withholding of low grades, and authorize disposition of surplus potatoes into industrial uses, livestock feeds, and to institutional food outlets, thus permitting only the best qualities to be shipped. Nowithstanding the farmer's inherent dislike for allotments and quotas, I believe potato growers are so concerned about the future that they will gladly cooperate in a program based on these recommendations.

That is our approach to one of the problems that you have presented, Senator Thye.

Senator THYE. It is a very sound approach, and it is the type of approach that would overcome many of the problems with which we have been confronted.

Mr. HUSSEY. We believe the responsibility is ours, accomplishing some things through the marketing agreements, working through the Production and Marketing Administration Field Branch.

Our objective is to keep administration at the local county and State level, with authority to act divorced as much as possible from centralized authority in Washington, but with sufficient guidance, under the general over-all program, to assure continuity and uniformity of application all over the country.

The CHAIRMAN. Your statement has been a very interesting one, Mr. Hussey. We are greatly obliged to you.

Mr. HUSSEY. We appreciate very much this opportunity of being heard. We appreciate the interest you men have taken in our problems, and the problems of agriculture in the country as a whole. We are happy to have had a chance to submit this testimony.

Senator AIKEN. You have not said very much about the rest of the bill. I assume from what you have said that the farmer-elected committees meet with your approval?

Mr. HUSSEY. Yes; at the community and county levels. I believe that the bill provides for county-elected committees, but that it does not go far enough in the direction of the communities.

Senator AIKEN. You would recommend going down below the county level?

Mr. HUSSEY. I firmly believe that a very important part of the system is the farmer-elected community and county committees, with the program administered, as far as possible, at community, county, and State levels.

Senator AIKEN. Did you notice any glaring errors or omissions in the rest of the bill? I presume you have read it. Perhaps you do not want to go into that now, but if you do, we would be glad to hear from you and to get your opinion.

Mr. HUSSEY. Senator Aiken, I cannot discuss the bill in detail. I have not read it thoroughly enough to do so. I read it rather hastily. I am sorry I did not go into it in more detail.

I would question the set-up of the National Advisory Council. I do not recall the exact wording of that provision.

I would like to see it set up on the basis of operating in an advisory capacity rather than in an administrative one.

Senator AIKEN. It would be advisory, except in case of emergency, where it would have authority from the Secretary to deal with various support-price levels.

Mr. HUSSEY. I think the Council has a great deal of merit from the advisory standpoint. I would not be prepared to go further than that; but I want to be sure that we do not, in creating that Council, replace, in effect, the Secretary or the present Department of Agriculture.

We have a great deal of faith and confidence in the Department of Agriculture, as set out, and they have been doing a grand job for agriculture. We do not want to see any more changes than are absolutely necessary.

Senator AIKEN. You do not want to have divided authority there? Mr. HUSSEY. Yes; I do, Senator.

Senator AIKEN. Dr. Case has just suggested that, as the bill is written, any community could, on its own initiative, probably elect a local committee. That, however, is something that we will have to explore.

Mr. HUSSEY. I cannot discuss that very intelligently, except to say that I have been convinced, as a farmer and as a member of the State committees, that our present system is basically sound. I am not so much concerned with what you call it as much as I am with the continued farmer-elected community and county committees. That is basic to me. The name of AAA is immaterial to me.

The CHAIRMAN. That practice has been pretty generally followed in your part of the country; has it not?

Mr. HUSSEY. Yes. It has not been a matter of politics, but has rather been a matter of carrying out a program in the interests of agriculture by the farmers themselves cooperating with the Federal Government, so far as is desirable, to assure uniformity over the entire country.

The CHAIRMAN. Have you gotten good results?

Mr. HUSSEY. We certainly have. It has been a grand program. That may be somewhat of a surprise, coming from the State of Maine, but nevertheless we firmly believe in it.

Senator AIKEN. It would be pretty difficult to be partisan in Maine. The CHAIRMAN. We are very much obliged to you, Mr. Hussey, for a very interesting statement.

Mr. HUSSEY. Thank you, gentlemen.

The CHAIRMAN. We have additional witnesses scheduled for next Monday, starting at 10 o'clock. We will adjourn now until 10 o'clock Monday morning.

(Whereupon, at 12: 15 p. m. the subcommittee adjourned, to reconvene at 10 a. m. Monday, April 19, 1948.)

AGRICULTURAL ACT OF 1948

MONDAY, APRIL 19, 1948

UNITED STATES SENATE,

COMMITTEE ON AGRICULTURE AND FORESTRY,

Washington, D. C.

The committee met pursuant to adjournment at 10 a. m., in room 324, Senate Office Building, Senator Arthur Capper (chairman) presiding.

Present: Senators Capper (chairman), Aiken, Bushfield, Young, Thye, and Ellender.

The CHAIRMAN. The committee will come to order.

We will resume the hearing on Senate bill 2318.

Our witness this morning is Dr. John Black, professor of economics, Harvard University, Cambridge, Mass.

STATEMENT OF DR. JOHN BLACK, PROFESSOR OF ECONOMICS, HARVARD UNIVERSITY, CAMBRIDGE, MASS.

Dr. BLACK. Mr. Chairman, members of the committee, I have brought along for members of the committee this morning some preliminary material which has been developed by a group working with the agricultural committee of the National Planning Association.

The CHAIRMAN. Will you tell us what the National Planning Association is?

Dr. BLACK. It is an organization that has been in existence for about 15 years.

The CHAIRMAN. Where are its headquarters?

Dr. BLACK. The headquarters are in Washington. Its method of organization is this: It has three subcommittees, one on agriculture, one on labor, and one on business.

The CHAIRMAN. How long has this organization been in existence? Dr. BLACK. Fifteen years, but in its present form only about 8 years.

These committees work independently of each other on problems, each in its own field. But the essence of their procedure is for all three of them to get together and work out a program upon which they can all agree.

The CHAIRMAN. Are they making some progress?

Dr. BLACK. Very definitely, yes. I expect this Association had as much to do with the congressional Reorganization Act as any other group in this country.

The CHAIRMAN. The Reorganization Act?

Dr. BLACK. I am referring to the act which Congress passed to reorganize itself a year or so ago. The reorganization plan that was