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Federal Reserve Board reports that the rise in installment debt outstanding has outpaced the rise in income. A University of Michigan Survey indicated that about one-half of all U.S. families reported installment debt early in 1965. These are mainly young and middle-income families.

Government agencies, voluntary groups, and business and industry have produced helpful publications to guide families in managing their finances. Adult consumer education through the schools and through the Cooperative Extension Service have given guidance on money management, budgeting family income, and consumer buying.

During 1966, planning was initiated by a national committee of home economists for a Conference on Credit to be sponsored by the American Home Economics Association in October 1967 for a selected group of home economics leaders from the various programs in all areas of the United States. The purpose of the Conference will be to expand the contribution of home economists to family welfare through teaching, research and counseling in the use of credit.

NEW ORGANIZATION

Through a vast and complex marketing system, U.S. consumers received $123 billion worth of food and fiber in 1966. Behind the enormous operation were 10 million people employed in getting these products from farm to market to consumer, a process involving government administered programs and services designed to maintain and strengthen competition of private enterprise while promoting efficiency and equity.

In order to improve programs and services to consumers, farmers and the marketing system, the U. S. Department of Agriculture created a new agency, the Consumer and Marketing Service. Its mission-to service, regulate and protect the marketing system-is carried out in four broad program areas, Consumer Food Programs, Consumer Protection, Marketing Services and Market Regulation.

The Department is guided by five goals in the administration of these programs and services: 1) to improve diets and nutritional levels of all Americans, particularly needy persons and school children; 2) to assure the wholesomeness of meat and poultry and other food supplies, thereby safeguarding the health and well-being of all citizens; 3) to maintain orderly marketing that improves prices to producers and assures adequate supplies of food for consumers; 4) to provide services essential to the existence of an efficient, fair, competitive marketing distribution for farm products, and 5) to eliminate deceptive, unfair, and fraudulent trade practices in the processing, marketing, and distribution of agricultural products.

CONSUMER PROTECTION

The meat and poultry inspection programs of the Department of Agriculture's Consumer and Marketing Service assure the wholesomeness of all meat and poultry produced in plants dealing in interstate and foreign commerce. During fiscal year 1966, USDA inspected more than 60 billion pounds of meat and poultry and supervised the sanitation and handling practices in the plants where the products were prepared.

Federal inspection programs covered 85 percent of fresh meat and poultry sold in interstate and foreign commerce during fiscal 1966, and approximately 75 percent of the processed meat products.

The labels of all processed meat and poultry products produced in federally inspected plants must also meet USDA approval as to accuracy, adequacy and truthfulness. For example, in fiscal 1966, nearly 70,000 new and revised labels

were reviewed, with approximately 5,200 returned for modification so that the consumer would not be misled.

The American consumer's continued use of convenience foods was reflected in the inspection of cut-up poultry and processed poultry which increased 19 percent from fiscal 1965.

USDA's meat inspectors passed as wholesome more than 47.7 billion pounds of meat and meat products prepared in federally-inspected packing plants during 1966. This included inspection of each animal immediately before and after slaughter, and through all steps of processing. Federal meat inspection was carried out in 1,931 plants in 812 cities and towns during fiscal 1966. MARKETING SERVICES

The Consumer and Marketing Service (C&MS) provides market news, grading, inspection and Federal standards of quality to facilitate pricing and competitive marketing in our free enterprise economy and to provide uniform trading identification and information of value to all in the marketing system— from farmer to consumer.

GRADING PROGRAMS

From the consumer point of view, grading is a most important program. It provides a common, universal language of trading. It helps the consumer find the quality desired in the supermarket. It helps the farmer know the quality and thus the value of his crops. It helps processors, shippers, brokers and retailers determine the relative price of agricultural products which are graded.

Food grading is provided on a strictly voluntary basis by C&MS,_often in cooperation with State departments of agriculture. In the United States, significant quantities of meat, poultry, eggs, grain and fruits and vegetables are graded and in increasing quantities even in relation to growth of production.

Federal grading of beef, for example, moved from 53 percent of the Nation's total commercial beef production in fiscal 1964 to more than 60 percent in 1966. Lamb grading jumped from 50 percent to nearly 60 percent, frozen fruits and vegetables from 75 to 80 percent, and rice from 75 to 96 percent.

In addition, in fiscal 1966 C&MS graded almost all of the Nation's cotton and tobacco, two-thirds of the grain, more than half of the butter, and two-fifths of the canned fruits and vegetables. Enough fresh fruits and vegetables were graded to fill a railroad train 13,000 miles long. Such a train would stretch from coast to coast more than four and a half times!

STANDARDIZATION OF QUALITY

But grading depends largely on the development of proper, up-to-date quality standards on which to base the grading programs. Standards provide the uniform, non-partial grading services with the means of classifying all available qualities of agricultural products—and they establish the terminology for grading.

Within the past 3 years, the United States has been cooperating with other Food and Agriculture Organization and the World Health Organization) in countries through the Codex Alimentarius Commission (sponsored by the the development of international food standards. Specialists working with several committees have worked on standards for fats and oils, dairy products, meat and meat products, and processed fruits and vegetables. Standards for 10 varieties of natural cheeses have been developed in the past year.

New and major revisions of domestic standards in the past 3 years have included:

Addition of yield grades for beef carcasses to the quality grade standards.

Revision of beef grades to reflect recent research on marbling and maturity.

Addition of micronaire readings (measurements of fiber fineness) to official cotton standards.

Revision of standards for canned and frozen red tart pitted cherries and for frozen French fried potatoes, and for more than two dozen other fruits and vegetables.

New standard for poultry roasts, swiss cheese, mixed nuts in the shell, okra, and blueberries.

The first major revision of standards for wheat in their 50-year history. In addition, standards were revised for eggs—tightening the requirements for U.S. Grade AA and U.S. Grade A eggs.

VOLUNTARY INSPECTION SERVICES

Another type of marketing service activity is the inspection-on a voluntary, fee basis of egg products, dairy products and processed fruits and vegetables. This service not only provides manufacturers of these products with assurance that the products are sanitary, wholesome and processed under modern quality control supervision, but also provides the consumer with clean, safe foods. During this three-year period, standards were revised for inspection of egg products to require pasteurization insuring freedom from harmful microorganisms. Work was also started on an inspection program (in operation in 1967) for instant nonfat dry milk. Although 40 percent of the Nation's nonfat dry milk is inspected, until 1966 all of this was of the "non-instant" variety. The new inspection program for instant dry milk will provide American_consumers a guide to wholesomeness of this product by use of a "USDA Extra Grade" shield which will appear on consumer packages.

In 1966, C&MS certified the quality of: 94 percent of the liquid and 74 percent of the Nation's dried egg products, two-thirds of the frozen fruits and vegetables, and a quarter of the canned fruits and vegetables.

MARKET NEWS SERVICES

The Federal-State Market News Service, administered in cooperation with State departments of agriculture, provides a guide to the market for farmers and those who market agricultural commodities, and assures consumers of adequate and economical food supplies by helping to make the farm-to-market movement of agricultural products more efficient, orderly, and economical.

Accurate, up-to-the minute information on the supply, demand, prices and movement of agricultural products, flashed from coast to coast, helps farmers and marketers know what supplies are available, where, and at what prices. More than 170 Federal Market News offices over the Nation (tied in with hundreds of State offices) gather this information daily and make it available across the Nation through a 20,000-mile leased wire network which interconnects the offices.

More than 100,000 different reports, covering all farm commodities, were prepared in 1966 and distributed in 20 million separate mailings, as well as through mass media-newspapers, radio and television. To be useful, these reports must be kept up-to-date. In the past five years, more than 3,750 changes have been made in these reports.

The Federal-State Market News Service celebrated its 50th anniversary of service to the Nation in 1965. The first market news report was issued on Louisiana strawberries in 1915—in Hammond, La.

C&MS has been working on increasing its market news distribution.

OTHER MARKETING SERVICE ACTIVITIES

-Marketing guides for fruits, vegetables and poultry, which allow farmers to plan their production to meet expected needs. Marketing guides for turkeys were started in 1965.

-Purchase of perishable foods in temporary oversupply for distribution to schools, institutions and the needy. In the 1964-66 period, C&MS purchased poultry, meat, margarine, shortening, fruits and vegetables, and dry beans and peas for this program.

-Federal-State marketing improvement projects. These local, self-help programs are supported by Federal matching funds to encourage efficiency and improvement in the marketing system. These programs work in five major

areas:

1. Quality improvement. Farmers in Alabama were encouraged to use Federal-State grading and uniform packaging in their cooperative farmers' markets. By selling a better uniform-quality product, they received increased returns.

2. Market expansion. Matching-fund employees in Virginia promoted the sale of low-grade cattle (not in demand in the U.S.) to European markets where such beef is in demand.

3. Marketing efficiency. New methods in packaging and distributing highquality liquid egg products in New York increased sales of such products. 4. Marketing information. Several Mid-west States cooperated in achieving uniform reporting techniques on wheat statistics, providing for more usable information for all farmers and marketers in that region. 5. Organizational structure. Former coal-miners in West Virginia formed a cooperative to sell large quantities of minor crops, providing extra income in the Appalachian region.

MARKET REGULATION AND SURVEILLANCE

A number of regulatory and surveillance programs are administered to protect producers and growers from unfair and unjust trade practices which might deprive them of fair prices for their products, and to protect consumers from. anti-competitive and monopolistic practices that might unduly affect the prices they pay for food. Other programs help to level out the peaks and valleys in production and marketing, stabilizing markets to the benefit of both producer and consumer.

PACKERS AND STOCKYARDS ACT

Each year, some 2 million livestock and poultry producers market livestock and poultry valued at more than $11 billion-about a third of all cash farm income. Consumers spend about $30 billion for meat and poultry—more than 20 percent of their total food budgets.

The Packers and Stockyards Act (P&S) prohibits unfair, deceptive, discriminatory, and monopolistic marketing practices in the interstate marketing of livestock, poultry and meat.

Over the past 3 years (fiscal), USDA's Consumer and Marketing Service received more than 14,000 complaints of violations of the Packers and Stockyards Act. The number of complaints rose to an all-time high of nearly 6,000 in 1966. Of the total number of complaints received in the 3-year period, more than 10,000 have been settled on an informal basis, resulting in payments to complainants of nearly $4 million.

In addition to the formal and informal settlements of disciplinary actions, formal reparations actions settled resulted in awards of more than $589,000 over the 3-year period.

Farmers and other livestock shippers were saved an estimated $575,000

by the refusal of P&S personnel to approve increases in marketing service charges which could not be justified.

Significant progress has been made in updating P&S Act regulations to bring them in line with current livestock, poultry, and meat marketing practices. In 1964, regulations were issued to insure prompt payments for livestock and poultry purchases, to prohibit price guarantees in soliciting livestock consignments, and to require printed weights on scale tickets.

Bonding requirements were strengthened in 1965, resulting in an increase. to $175 million of the total surety bond coverage of market agencies, dealers, and licensees subject to P&S Act jurisdiction. Prompt pay requirements were extended in 1965, and regulations were issued to require periodic testing of monorail packing plant scales used to determine pay weight of livestock sold on a carcass yield basis.

1966 saw a strengthening of regulations dealing with the handling of livestock consignors' funds. All consignors' sales proceeds must now be kept in separate custodial accounts maintained in banks covered by the Federal Deposit Insurance Corporation (FDIC), with records kept on each consignor's interest in the account so he is protected to the FDIC maximum of $10,000.

Of the several major investigations conducted in the past 3 years, one dealt with alleged boycotting and "blacklisting" of poultry producers growing birds for processors on a contract basis. Following the investigation, a formal complaint was issued against 3 major processors. This complaint is now being litigated. Other investigations have led to formal or informal actions in the areas of monopolistic and anti-competitive packer merchandising practices including "point promotions," below-cost selling of product, "bait and switch" advertising, and misrepresentation of product sold to consumers. While some of these cases have already been settled, others are still being litigated.

Over the past 3 years, 38 Memorandums of Understanding have been signed with various State regulatory agencies to provide for a free flow of information on regulatory activities and to eliminate duplication of such activities.

A system of area surveys has been developed to enforce trade practice regulations at livestock_auction markets. Approximately 20 percent of the markets in a particular State or region are checked for questionable operating practices; any P&S Act violations are noted and explained, and meetings are held with operators of all markets in the area to explain P&S Act requirements and put the operators on notice to correct their operating practices. Subsequent checks are made to be sure that questionable practices have been corrected.

An expanded program of checkweighing has been developed to help eliminate faulty weighing equipment and dishonest weighing practices. In many cases, P&S personnel reweigh livestock immediately following market weighing. In other cases, they sell livestock which have been weighed on scales of known accuracy, and compare market weights with their own weighing results. FRUIT AND VEGETABLE MARKETING DISPUTES

Produce marketing disputes settled by the USDA as a result of action under the Perishable Agricultural Commodities Act reached a new high in 1966-both in the number settled and in the value of the losses recovered. This law sets a code of fair trading practices in fresh and frozen fruit and vegetable marketing and provides for quickly settling contract disputes between buyers and sellers. It requires that those who trade in produce in interstate or foreign commerce be licensed. The USDA can suspend or revoke a trader's license for such violations as failing to deliver produce according to contract, unjustly rejecting produce bought, and failing to pay promptly for shipments. In fiscal 1966, losses recovered for industry members amounted to $3.5

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