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If I understand correctly the general philosophy underlying the bill introduced by Senator Bankhead to create the Farm Tenant Homes Corporation, it is aimed at going back to the old principles, intended but not realized in our early land policy, of trying to get the good farm land of America into the hands of owner-operators who
live on family-sized farms, but with proper safeguards to prevent the land from again becoming a football of speculation. I am confident that the provisions of this bill, if it is enacted into law, can be administered in such a way as to bring greater individual opportunity to hundreds of thousands of our tenant operators; check the growth of rural tenancy in this country; and bring much greater stability and security to thousands of farm communities. Moreover, it would be of substantial aid in dealing with our problem of surplus cash crops. Our recent experiences have shown that a reduction of acreage in a tenant community tends to create agricultural unemployment, with some of the evils characteristic of urban unemployment. However, in communities where practically all farms are operated by owners, the acreage-reduction programs have brought about a greater diversification of farming with a resulting higher standard of living, and have aided in increasing soil fertility.
If the provisions of a law similar to those incorporated in the bill which we are considering are administered as intended by the author of this measure, it should be a substantial aid to the broad national recovery program, reduce materially the relief burden in rural areas and bring great benefits to thousands of tenant farmers who are in pitiful economic condition and in serious need of rehabilitation, and check the deterioration of our rural civilization. No better method of aiding our tenant farmers can be undertaken than to give them a secure form of tenure on a family-sized farm; aid them in carrying out a farm and home-management program that will yield a reasonable cash income; and, at the same time, create a farm and home unit as a permanent, desirable, and secure place to live and rear their children.
As I read the proposed bill, there is no intention to take land from an unwilling seller. The provisions made for condemnation proceedings are merely to clear title after the terms of purchase are agreed upon between the buyer and seller. There is absolutely no intention, as I understand the measure, to take lands from persons who don't want to sell.
Senator BANKHEAD. That is correct, Mr. Secretary; that is absolutely correct.
Secretary WALLACE. That is correct. As a matter of fact, there should be no occasion for the proposed corporation to want land which the private owner does not want to sell. The National Resources Board reports that, as a result of the depression, a more than usual proportion of our land is in the hands of creditor or Government agencies which have been compelled to take over the property. In the West North Central States nearly 30 percent of the total value of farm lands was thus owned and in the East North Central States nearly 20 percent, the National Resources Board reported.
They do not give figures there for the South Central States, bit it is my understanding that the figures there may be even higher. " have been unable to get any figures on the South Central States, however. Thus it would be possible for this proposed corporation to acquire considerable areas of lands without having to make purchases from private landowners.
It is imperative that the administration of the provisions in a bill so farsighted and socially desirable as this one be carried out in accordance with sound principles of farming and in the light of the best experience in dealing with rural problems. I take it that the main purpose of this bill is not to make available a large sum of liberal credit to be promiscuously used in aiding tenants to purchase farms, without any thought as to the resulting consequences of their newly acquired ownership. To transfer some of our inexperienced and undesirable rural tenants into immediate owners, by the simple expedient of loaning them substantial amounts of money on very liberal terms, might create more social problems than it solves. On the other hand, by following a sane and conservative program for aiding desirable tenants in becoming owners; and by helping the inexperienced ones to follow sound farm management practices we shall be able to aid them in buying a farm which they can retain as a permanent home. I can assure you that the Department will mobilize its extensive technical resources and devote the best experience of its scientific and extension forces toward accomplishing these objectives, because we believe thoroughly in them.
At this point I entered into a discussion of the Irish and British and other foreign-land policies, but inasmuch as I have already gone over that, I don't think I will burden the record with it.
It may be argued by many people in this country, that to aid a tenant in becoming an owner on a shoe string of credit is socially undesirable and economically unsound. Such hasty conclusions are likely to develop when there has not been a mature and considerable analysis of the provisions embodied in the bill proposed by Senator Bankhead. It is often extremely difficult for tenants to obtain holdings of the proper size to fit their ability and family labor supply. Moreover, it has been virtually impossible for more than a decade for many of our energetic and ambitious farm boys to acquire capital sufficient for the customary down payment on a good farm. Many tenants with years of farm experience have been earning such a small margin, after they paid their rent to the landlord, that they were virtually forced to continue through life as tenant operators. The percentage of tenants who are more than 55 years old has been increasing in this country for several decades. Now we have about 375,000 who are over 55 years of age. Many of these people have struggled toward ownership for years; and yet in their old age have no home of their own and no more security than when they started as farm laborers.
An active Government program aimed at making owners out of desirable tenants through a system of long-term loans which can be repaid by taking the ordinary rent as payments toward the ownership of a farm is a thoroughly sound and justifiable procedure for creating greater security and more desirable homes for our rural tenant population. During the period when the purchasers are slowly creating an equity in the farms they operate they will have all the security of an owner and should develop a real and lasting interest in maintaining their homes and permanently participating in the social life of their communities.
In short, I am happy to support a measure which has as its aim the creation of a substantial group of farm owners out of our present tenant class. I know of no better means of reconstructing our agriculture on a thoroughly sound and permanently desirable basis than to make as its foundation the family-sized, owner-operated farm. I believe that the provisions of this bill can be put into effective operation in such manner as to bring greater individual opportunity and security to thousands of tenants. At the same time they should be of substantial aid in our crop-adjusting programs and in our attempts to conserve soil fertility and prevent erosion. Moreover, these provisions will aid materially in bringing about the development of a rural civilization embodying a higher standard of living and a better developed and more stable community life than has been possible under a system characterized by land speculation, absentee landlords, and migratory tenants.
Senator BANKHEAD. Are there any questions, gentlemen ?
Senator POPE. Mr. Chairman, do you have any idea as to the number of people that would have to be employed to carry out this program and the cost of administration ? Have you any idea about that, Mr. Secretary?
Secretary WALLACE. I may say, Senator, that so far as I personally know, the Department has not gone into the details of this bill. This presentation on my part is really addressed to the broad phases of the program, and, as I said in my opening statement-I am not sure you were here at the moment—the Department has not yet been called upon in a formal manner to give a report on the bill, and at that time no doubt we will go very carefully into these factual matters of operation.
Senator BANKHEAD. Mr. Secretary, we thank you very much for this informative and helpful statement.
Secretary. Roper had intended to be here this morning, but has been unavoidably detained. In 1926 Secretary Work, Secretary of the Interior at the time, appointed a committee to make an investigation of rural conditions in the Southern States particularly. Secretary Roper was a member of that committee or commission, and he sent me a report which the committee made. It is too long to put into the record, but it contains some very helpful information, and it is possible that I will make some extracts from it and put them in the record.
Senator POPE. Did the committee arrive at some sort of conclusions or recommendations?
Senator BANKHEAD. Yes; they were very strong for this general program, although there was at that time nothing specific contemplated. Of course, conditions were not right for Government aid at that time, but they suggested it as one of the necessary steps in working out a better rural life situation.
Senator POPE. I would suggest that you select from that report some paragraphs that show their conclusions and recommendations.
Senator BANKHEAD. That is what I intended doing.
Senator MURPHY. Have you any idea when the figures from the last agricultural census will be available?
Senator BANKHEAD. Yes; they will not be available for this session of Congress. I have followed that. It will take them 4 or 5 months to compile their figures and make a report.
Senator MURPHY. I understand the percentage of tenants is very much higher now than as shown in the last census.
Senator BANKHEAD. That is the general indication. I think we will find it in a marked degree when we get the official figures. It has resulted from numerous causes. One specifically is that so many farm-mortgage foreclosures resulted in the operation of the farms by tenants. Another is that there were so many people stranded in industrial centers who went back to the country and to farms but who were without the ability to buy. They have been renting places here and there and they have gone back to the farms as share croppers or as farm laborers. Those are the two chief outstanding reasons for the conditions, but they have both contributed a very large number of new tenants, farmers who are working upon farms without farm ownership.
Mr. Westbrook, who is assistant to Mr. Hopkins and has had charge of the farm rehabilitation program and has had direct contact with this general subject, was here for the purpose of making a statement, but has been called away on an emergency call, but will be available before we conclude the hearings.
I will call Dr. Gray at this time.
STATEMENT OF L. C. GRAY, CHIEF, LAND POLICY SECTION,
AGRICULTURAL ADJUSTMENT ADMINISTRATION
Mr. Gray. Senators, Secretary Wallace in his statement has quoted statistics showing the extent of tenancy in the United States, and I will not burden you with detailed statistics, but I might say for the benefit of the committee, we have prepared quite a large number of tables from which I hope that we may be able to answer some of the questions that your committee might raise. I can't keep them all in my head, but we can make them available for the record, and I will call upon my assistant here to provide you with such statistics as your questions may call for. The magnitude of the tenant problem is emphasized by the fact that in 1930, 42 percent of all our farmers were tenants, working the same percentage of all harvested
Senator BANKHEAD. Do you have any idea what the increase has been since that time?
Mr. GRAY. Yes. You asked the question a few moments ago as to the increase from 1920 to 1930. I can't give you the decimal fractions, but the figure was about 38 percent in 1920, and in 1930 it was slightly over 42 percent, as the Secretary stated. We have no figures since the census of 1930, but we have roughly estimated that the percentage of tenancy is not less than 45 percent at this time. There is every indication that it has been rapidly increasing during the last 4 or 5 years. In 1930 the value of land and buildings operated by tenants amounted to a total of $16,383,000,000, or a little more than one-third of the total value of all farm real estate. In addition to the farms operated entirely on a rental basis, there were 656,750 farmers who rented part of their land, hence 53 percent of all our farmers rented either all or part of their land. The problem of tenancy is therefore almost staggering in its immensity, and night appear to be discouragingly great were it not for the fact that tenancy is not equally serious in all parts of the country. It is the purpose of the Bankhead bill, as I understand it, to deal with the problem in those areas where its consequences are most serious. Furthermore, it is encouraging to recognize the fact that when provisions of this bill are put into effect on the scale made possible by the bill itself, the indirect effects in setting an example for better conditions of land tenure and better methods of farming will probably be as great as the direct effects.
I might say a few words about the geographical distribution of tenancy, and I want to show you a map on that point. While some tenancy is found in nearly every State of the Union, the percentage of tenant-operated farms varies greatly in different parts of the country, ranging, by States, from highs of 72.2 percent in Mississippi and 68.2 percent in Georgia to lows of 4.5 percent in Maine and 5.3 percent in New Hampshire. In fact, tenancy, as you gentlemen know, is not very extensive in New England.
I shall put in the record a table showing the distribution of tenants by States. That table is available if you gentlemen should care to know the percentage of tenancy in any one State.
Senator BANKHEAD. Is that the same as this table that has been furnished me?
Mr. Gray. It is based on the census; it is not made up in exactly the same way. We have a table showing the increase by decades by States.
Senator BANKHEAD. We will be glad to have your table. Mr. GRAY. I will put all of that in the record. Tenancy is usually highest, as the Secretary indicated, in regions of cash-crop production, such as cotton, tobacco, corn, and wheat. In many counties of the Mississippi Delta more than 80 percent of the farmers are tenants. Hundreds of counties in the corn-growing regions of the Middle West have more than 50 percent of all farms operated by tenants.
I can show you in just a moment a chart that will bring out the geographic distribution of tenancy. I understand that you can't put charts in the record.
Senator BANKHEAD. Unfortunately, we can't. Mr. GRAY. But this chart will be helpful to us. Senator BANKHEAD. I will be glad to have you leave us this chart. Mr. GRAY. We will try to make it available, Senator. [Showing chart.] This chart shows the distribution by counties of tenancy in the United States. The lighter shades, of course, are where the tenancy is less serious and ranging on down. In the black areas tenancy is 80 percent or more of the total number of farms. The next figure, the cross-hatching, is 60 to 80 percent. You will find, in general, that tenancy is extensive in many parts of the Tobacco and Cotton Belts and also spots of it in Illinois and northwestern Iowa. A little spot over here in South Dakota. Then, this hatching here shows percentage of from 40 to 60. That is quite extensive in the Corn Belt here and in the Wheat Belt, as well as in portions of the South.