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CHAPTER 2. ADMINISTRATIVE ORGANIZATION.

I. WASHINGTON ORGANIZATION_

Headed by an Administrator responsible to the Secretary

of Agriculture, the Agricultural Adjustment Administration
is divided for administrative operation into five regional
divisions for the continental United States, and an insular
division-Administrative divisions based upon types of
farming followed in corresponding regions-Appropriate
assistants, experts, and operating divisions included in the
organization.

II. ORGANIZATION IN THE FIELD_

State offices established in 1936-Officials and employes

perform, in the field, those functions which can best be
handled there rather than in Washington-Applications
for grants examined and audited in the field for three
regions.

III. FARMER PARTICIPATION IN PLANNING PROGRAMS_

Community, county, and State meetings gave farmers

opportunity to express views and opinions in framing pro-

visions of conservation programs County-planning proj-

ect yielded data and recommendations-Total of 2,712

county agricultural conservation associations organized

in 1936.

IV. OPERATING THE PROGRAM_

State administrative organization-Community and

county officers elected by farmers themselves throughout

most of agricultural area-County committees review all

forms and documents filed in connection with the program

in their counties.

CHAPTER 3. MARKETING PROGRAMS

I. MARKETING PROGRAMS FOR FRUITS AND VEGETABLES.

Marketing programs redrafted in accordance with

amendments to the Agricultural Adjustment Act-Amend-

ments specify commodities to which marketing agreements
and orders may be applied-Seven programs in effect at
end of 1936 for commodities other than dairy products-
Programs affect 90,000 growers-Objective is to adjust
shipments to market demand.

II. MARKETING PROGRAMS FOR DAIRY PRODUCTS_

Dairy industry experienced gains in 1936-Several fac-

tors have contributed to this improvement-Agreements
and orders in effect for fluid-milk markets and for evapo-
rated milk and dry skim milk industries-Agricultural
Adjustment Administration cooperates with State milk-
regulatory bodies-Legal status of marketing orders not
determined.

CHAPTER 4. SURPLUS-REMOVAL OPERATIONS.

I. PROGRAMS FOR ENCOURAING INCREASED DEMANDS FOR FARM

PRODUCTS.

Cotton price-adjustment payment plan moved cotton

into commercial channels-Funds obtained from customs
receipts-Flour from Pacific Northwest exported to
Philippine Islands-Other agricultural commodities ex-
ported.

II. PROGRAMS FOR DIVERTING FARM PRODUCTS TO NEW USES..
Fruits marketed in new forms-Cotton used in road-
building operations.

III. PROGRAMS FOR PURCHASING SURPLUSES FOR RELIEF DISTRI-

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Animals affected with bovine tuberculosis, Bang's dis-
ease, and mastitis eliminated.

CHAPTER 5. LIGHTENING THE IMPACT OF THE 1936 DROUGHT.

I. AGRICULTURAL PROGRAMS INCREASED FORAGE Supplies

Production of hay crops in 1936 above average--Shortage

offset in part by carry-over of 13 million tons-Livestock
numbers adjusted in 1934 and 1935 to supply of available
feeds in 1936.

II. GOVERNMENT ACTIVITIES IN DROUGHT Relief

Interdepartmental and departmental committees ap-

pointed Soil-conservation program adjusted to assist in
meeting drought demands-Livestock conserved and mar-
ket collapse prevented-Supplies of seed saved for use in
1937-Needy relieved by distribution of food and feed
purchased by the Agricultural Adjustment Administra-
tion-Assistance given in locating feed supplies and in
removing livestock from drought-stricken area.

III. STABILIZATION AMELIORATES EFFECTS OF DROUGHT

Effects of drought intensified by exploitative system of

farming-Measures taken under conservation program
meet requirements of scientific studies-Cultivation of soil
not incompatible with conservation of resources.

IV. EMERGENCY MEASURES MAY BE DEMANDED AGAIN

Necessity for emergency operations may be lessened by

better system of land use-Crop-insurance plan would
protect producers and consumers against effects of drought.

CHAPTER 6. THE SUGAR PROGRAM..

I. LIQUIDATION OF SUGAR PRODUCTION-ADJUSTMENT PROGRAMS_

Contracts with producers terminated as a result of the

Supreme Court decision of January 6, 1936–Payments due
to producers under these contracts totalled $33,586,606—
Of these claims $28,000,130 was disbursed during 1936.

II. ADMINISTRATION OF THE SUGAR QUOTAS IN 1936__

Quota provisions of sugar program not affected by

Supreme Court decision-Increasing consumption and a

deficiency in sugar-beet producing areas resulted in reallo-

cation of quotas during the year.

III. SUGAR IN THE AGRICULTURAL CONSERVATION PROGRAM_

Sugar beets and sugarcane classified as soil-depleting

crops with special acreage bases and special rates of pay-

ment under agricultural conservation program-Effect of

program was to enable growers to conserve productivity

of soil.

IV. THE GENERAL SITUATION IN 1936.

World prices reached record low levels as a result of

excess world supplies-Sugar quotas protected market of

United States producers-Invalidation of production-

adjustment contracts destroyed means of assuring labor

an equitable share in income from sugar beets and sugar-

OF PRODUCTION-ADJUSTMENT

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Through December 31, 1936, there had been disbursed

2,861,246 payments totaling approximately $230,430,000.

CHAPTER 9. CONSUMERS' COUNSEL

I. COOPERATION IN FORMING AND OPERATING FARM PROGRAM

Consumers' Counsel staff assists in economic planning

and conferences, presenting data related to consumers'
interests-Assists in research on cost, income, and con-
suming habits.

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Publications, radio, and correspondence serve as channels

for disseminating among consumers, knowledge of farm
and related problems.

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FOREWORD

I. THE YEAR IN BRIEF

1936 was an eventful year in the history of the farmers' Nation-wide agricultural programs.

On the 6th day of January the United States Supreme Court, in the Hoosac Mills decision, invalidated the production-control and processing-tax provisions of the Agricultural Adjustment Act, and brought the farmers' program to a complete stop.

But instead of terminating the farmers' efforts permanently, the decision of the Supreme Court in the Hoosac Mills case had the effect of hastening a transition which had long been planned. This was the transition from the temporary emergency phase of the adjustment programs to a long-time phase which would give a larger place to soil conservation and improved farm-management practice.

Such a transition was originally planned by the Agricultural Adjustment Administration in late 1934 and early 1935. It was the subject of discussions with representatives of farmers, agricultural colleges, and extension workers in a series of regional conferences in 1935.

President Roosevelt in a statement on October 25, 1935, had announced the Administration's intention to shift the program to a longtime basis. Hence the Hoosac Mills decision, when it came, precipitated as a sudden change that which had been planned as a gradual one. On February 29, 1936-less than 2 months after the Court's decision-Congress enacted a new law to replace the invalidated portions of the Adjustment Act. This new law was the Soil Conservation and Domestic Allotment Act.

Immediately upon provision by Congress of funds to carry it out, the Nation-wide soil-conservation program authorized by the new law was launched on March 20, 1936.

While putting this program into effect in all parts of the country as rapidly as possible, the Agricultural Adjustment Administration had to start work on a new and improved soil program for 1937. Meetings were held with farmers in communities and counties of many States, and recommendations were assembled for the 1937 plans.

Meanwhile the marketing agreement and surplus-removal programs affecting a variety of farm commodities were going forward. Also payments earned by farmers under the production-adjustment programs previous to January 6, 1936, were made from special funds appropriated for the purpose by Congress.

Operation of the 1936 program was complicated by the second great drought within 3 years, which early in the summer struck the western corn and hard-wheat belts and part of the cotton and tobacco belts of the South. Once more the farmers used their program to pool energies in combatting the effects of drought.

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