1 In addition $4,815,857 available from prior year balance and from recoveries of prior year obligations. 2 Funds appropriated or available for other activities administered by the Agricultural Stabilization and Conservation Service are set forth in the Commodity Credit Corporation and foreign assistance program s sections of these explanatory notes. Summary of appropriations, 1963, and estimates, 1964 1 In addition $81,379,500 advanced from the Commodity Credit Corporation fund. Based on the items proposed for transfer in 1964, the comparable amount is $123,018,000, including $41,638,500 from the CCC administrative expense limitation. In addition $94,885.000 advanced from the Commodity Credit Corporation fund (including CCC administrative expense limitation of $40,051,000 proposed to be transferred to and merged with this account). In addition $402,275 available from prior year balances and $2,095,908 in unused balances of funds previously advanced to CCC. Funds appropriated or available for other activities administered by the Agricultural Stabilization and Conservation Service are presented in the Commodity Credit Corporation and foreign assistance programs sections of these explanatory notes. Mr. WHITTEN. This operation comes under you, too, does it not, Mr. Duncan, as Assistant Secretary of Agriculture? Mr. DUNCAN. Yes, sir. Mr. WHITTEN. We presume here, as we have in other cases, that Mr. Godfrey, who is the Administrator, will present the general statement for the Department. If you have not made it clear, I will repeatand correct me if I am in error-the Commodity Credit Corporation has a relatively small group of direct employees, but most of its operations are carried out through the Agricultural Stabilization and Conservation Service and other employees of the Department in certain. types of cases? Mr. GODFREY. Yes. Mr. WHITTEN. So you really are testifying here as to the operation of the Corporation which is handled by employees who are identified under this title? Mr. GODFREY. Yes, sir. Mr. WHITTEN. We will be glad to hear your general statement, Mr. Godfrey. GENERAL STATEMENT Mr. GODFREY. All right, sir. Mr. Chairman, I would like to thank you first for moving us up, because it gives an opportunity to go ahead and get this moving along as fast as we could. I welcome the opportunity to explain our budget. I welcome the opportunity, though, to discuss ASCS, and, as you say, CCC activities, because CCC activities are administered through the personnel of ASCS. First, I would like to furnish a little background on program and management developments during the last year or so, using some charts and informal notes, and then continue with an explanation of budget increases and decreases. If it is all right with you, I have several charts here. I have always felt that a picture is much better than words. CCC INVESTMENT IN PRICE SUPPORT I want to start off with the first chart here, which shows the investment in price support operations by quarters beginning in March of 1952 and bringing it up to date. (The chart and table referred to follow :) 95910-63-pt. 3-36 1952: Investment in price-support operations by quarters, June 1952 to date 1 Reflects the inventory after revaluation as explained in note below. Amounts shown for June of all years and for each quarter starting with December 1960 are actual. The values shown for September, December, and March for all other years are estimated. 2 Represents the value of the inventory which appeared in this table in previous issues of this publication. This information is included for information purposes only and will not appear in future issues. NOTE.-The Corporation changed its accounting policy with respect to inventory cost as of June 30, 1961, and adjusted its former cost value of inventories to acquisition cost, plus the cost of any pac aging or processing performed after acquisition. Formerly, inventory cost as reflected in the accounts included recorded acquisition costs; storage, handling, packaging, processing, transportation and accessorial expenses incurred after acquisition; costs of storing on farms certain grain commodities while under extended loans prior to acquisition; and loan financing expenses (interest paid to lending agencies) relating to commodities acquired from 1957 and prior crop-year loans. Bezinning June 30, 1961, the published financial statements of the Corporation show inventory values determined on the basis of the revised accounting policy. Also, beginning with the fiscal year 1962, the published financial statements show inventory carrying charges, reseal loan storage expenses, and loan financing expenses as current operating expenses. All data used in the charts appearing in this publication relating to inventory costs beginning with June 30, 1952, and operating results beginning with the fiscal year 1953 are presented on the revised basis. The tables relating to charts affected by this change show data on the revised basis. 1, 191. 1 638.0 7,908. 1 7,374.5 7,399.5 1, 183. 1 883.9 6, 784. 8. 869.7 605.7 1, 341. 1 336. 1 1, 542. 3 895. 2 1,759. 4 1, 148. 6 1, 280.9 5,248.5 5,087. 1 1, 912.5 1, 390. 8 1, 113. 3 Mr. GODFREY. This is in March of 1963. There are some interesting things about this, if you will just notice. We started with a total investment back here of a little less than $2 billion, and it increased to a high here between 1958 and 1959, of a little better than $8 billion. It has gone up here temporarily during this period to a little in excess of what it was in 1958 or 1959. Mr. WHITTEN. Mr. Godfrey, a person looking at that would first think that you were a Democrat, and, then, secondly, he would think that you were optimistic when you said it has gone up temporarily. I hope you are right. Mr. GODFREY. Yes, sir. I think this can be proven, but what I am getting ready to say here is that the inventory figure has come down extremely low compared to what it was, so I think it will come down much further as we go along. We did not put on here our projections as to where this will be, as far as investment is concerned, but I can furnish that to the committee. I think the investment which we have projected for June 30, 1963, will drop to $6.9 billion right here; the investment for June 30, 1964, will be $6 billion total investment. Mr. WHITTEN. I am sure your figures are accurate, and I have always tried to keep some sense of balance here. You are hopeful, and so am I hopeful, that the overall costs and the overall welfare will continue. But there has been, for the record, a considerable shift of the cash payments and other things which, insofar as the Government is concerned, may offset some of the good things that you point out on your chart, which, again, is accurate. That is correct, is it not? Mr. GODFREY. Yes, sir; that is true. CCC INVENTORY Now, I would like to move along to the second chart, and this shows the price support inventory by commodities by quarters from March 1952 to date. Notice the red dotted section here is other commodities: then we have grains. Corn is indicated by the straight up-and-down lines; cotton, the solid red; and wheat, the crosshatch. (The material referred to follows:) |