the East will make your hats, your boots, your shoes, your clothes, your hog wire, your staples, your tin, your lead, your putty, everything in life we will build here," and he has not failed us. gone down that highway, breaking his ground and bringing in the crop to feed us, and today we have got our warehouses bursting with cotton and wheat-cotton and wool, and the granaries overflowing with wheat and corn, and he is busted. He is bankrupt today. He has no credit. He can't buy, and there are 53,000,000 of them. And take it from me, when 53,000,000 American citizens can no longer buy the products of mines, mills, and factories, we have got to shut our factories down, turn out our workers, and establish soup lines and bread lines to feed them.

I say the day you restore these agricultural commodity prices and pay these people in the country for our bread bill, pay them decent prices for the products that we need in these United States, these people who have brought fertile fields out of desert country, in order to clothe and feed us, stand ready and willing to buy prosperity back for every idle workman in the United States.

The CHAIRMAN. You know one of the great criticisms made by our economists, professors, and experts, is that the farmer is too extravagant. I don't know what he is extravagant on, but you know that is so.

Mr. CLAIR. I don't know. I am not an expert.

Senator MURPHY. Then you would say the cancer that has eaten through the steel walls of the banks, that has impoverished railroads and closed factories, had its origin right on the farm?

Mr. CLAIR. Absolutely. There is no other reason. Why should the Nation be distressed today? My God, when our forefathers came here, and landed on Plymouth Rock, that nothing with them except their brain and brawn and that is all they had, and today we find ourselves a Nation of 125,000,000 poeple-just a mere handful of those on the face of the earth. There are two thousand million people on the face of the earth, and a handful of us here have half the gold in all the world. Certainly if the rest of the world has got to get along with the other half, we have our share here. We have in the United States today 100 percent of the world's skyscrapers, seveneighths of all its factories. I might say also that the Federal Reserve System, with all its deficiencies, gives us the greatest banking system that was ever devised. We have the greatest system of transportation in our railroads, waterways, highways; the greatest system of communication, the greatest army of technicians and mechanicians ever mobilized on God's footstool. We have natural resources unbounded here in these United States today. We are not lacking in anything.

Here is the reason: Back in 1929 the American farmer had $12,800,000,000 turned back into the channels of commerce and buy, and that $12,800,000,000 turned over seven times.

Let me explain to you what I mean by that, Mr. Chairman. When a farmer buys a suit of clothes, he walks into his merchant's store in his county seat and today lays down $25. The merchant scalps that $25 about 20 per cent. He takes off about $5 and sends $20 to the city of Chicago, to the clothing manufacturer, or to New York City. The clothing manufacturer takes that $20 and he pays his heat, his light, his rent, his power, his taxes and Heaven knows they need

them in Chicago-he takes his profit, pays out his labor, and out of the $20 he sends about $12 to the woolen mills New England for the cloth and the buttons and the findings.

The woolen mills pay their heat, light, rent, power, taxes, take their profits, discharge their labor, and they send about $6 to the spinner. That $25 purchase of clothes turns over seven times before it finally gets into the hands of some man who pays off a piece of preferred stock or a bond, which buys a new machine and plows it back into permanent improvements in a building or something.

In other words, gentlemen, in the expenditure of the farmer's dollar you turn that commerce over seven times, and in the year of 1929 when agricultural products were worth $12,800,000,000, the national income of this Nation was $90,000,000,000, and we were prosperous. Last year, with agricultural products worth $5,200,000,000, the national income was only $40,000,000,000. There is the proof.

Senator MURPHY. The way to open factories is to start on the farm?

Mr. CLAIR. To start on the farm, give these people plenty of purchasing power.

Senator MURPHY. You heard the testimony of witnesses today who said these higher prices could not be had, that the consumer has not the money to pay them.

Mr. CLAIR. Of course he hasn't. He isn't paying them today.

Senator MURPHY. Instead of a price of $1.25 for wheat and 87 cents for corn and 20 cents for cotton, they say the consumer hasn't got the money to pay that.

Mr. CLAIR. He hasn't; there is no question about that. Men who do not work should not have money. Men who do not work do not produce and they should not have money. I am not saying they should not be fed. They should not have money. But, by the same token, those who do work should have money, and today there are in that West and South country millions of people who are working, making a crop without which we would all die next year, and they have no money. Certainly if they who do not work should not have money, they who labor should have it. Why haven't they got it? Why not pay our farmers, let us pay them decent prices, and just, for that portion of their crop that is necessary to clothe and feed us, and they will buy prosperity back. Let me prove it

Senator MURPHY. You don't have to prove it to me.

Mr. CLAIR. I know. There isn't a high school boy or girl out there in that country but what wants to buy a Ford roadster and a cedar chest and go off and get married. Give them a chance.

Senator BULOW. In other words, if the farmer has money, these fellows in industry will get it?

The

Mr. CLAIR. Yes. There is no wealth that will ever come into this Nation unless it comes out of the sea or out of the soil, and I submit to you that we in New York are not producers. We are neither fishermen nor farmers. We sell service and that is all. only new wealth that comes into this Nation annually has to come out of the soil, and when society regards that new wealth as being almost valueless, then society cannot make use of that wealth. If we would place a decent value on it today, these American farmers

would begin to buy automobiles and radios at once, and that is the only way that prosperity is going to come back.

I will also submit this to you, gentlemen; that you are now_confronted with the problem of refinancing the American farmer. I say to you, Mr. Chairman, that if a man has got 100 acres of cotton land down in that south country, and he has got a mortgage on that land, and the majesty of this United States Government may contract to pay 18 cents for his cotton, he won't have any trouble refinancing that mortgage. The mortgage companies of New York City will go down there like they did in 1929, and they will want to buy up the mortgage and refinance it for him.

We want to face a problem that is intrinsic today. It is not theory. It is not a promise that the American farmer and the American people need today. It is a price he needs, and it has been definitely stated in the Halls of Congress here that you want to place the industry of agriculture on the plane of other industries. Your present agricultural act so recites. Let us stop for a moment and find out what

plane they are on.

I submit that railroad rates are fixed, immigration has fixed the price of labor; the 8-hour day is sustained; the price of gold is fixed, electric light prices are fixed, postage stamp rates, telephone and telegraph rates are fixed. Why can't you make good your promise and place the industry of agriculture on a plane with the other basic industries?

Don't fix his prices. I am not asking you to fix his price. I am only asking you to establish a minimum price. I don't want you to pay any American wheat grower or corn grower a single penny for any bushel of corn that we don't need, but in God's name pay him a decent market price for every bushel that we do need.

When I come in my home at night the lights are not burning. I am not paying for the electricity then. But when I press that button, the current jumps in and lights that filament there, and I begin paying for what I use. And I am satisfied to do that. I am satisfied to pay that price found in the law for the electricity I am using. I am satisfied to pay for every pound of cotton that is needed to clothe my family or myself. I am satisfied to pay for every bushel of wheat that is needed to feed my family or myself, and I would like to go back to my business and know that somewhere in this country is an American citizen providing me with cotton and with wheat to feed my family and me, and I would like to know that I am paying him a decent market price for it.

The CHAIRMAN. I take it, then, that so far as this proposition in this allotment plan is concerned, you don't think it will turn the trick?

Mr. CLAIR. No, sir. It is not positive It seems rather ridiculousI don't want to be critical. It is not my purpose to be critical, but we have been teaching our people in our agricultural colleges to use fertilizer to increase production. I read here in the bill now you are going to absolutely forbid a man to fertilize the soil. That is paradoxical. I say let him use all the fertilizer he wants.

Senator BULOW. Where is that in the bill?

Mr. CLAIR. It is right in here.

Senator BULOW. Find it.

Mr. CLAIR. I will find that for you later, Senator. I say let our farmers plant where they will, what they want. That is there business. As a newspaper man asked me, "What are you going to do with your surplus?" I made this simple answer. "I came into your town and bought a newspaper. I laid down 10 cents, and the girl gave me 5 cents change. I bought the newspaper and read it, and I never thought what you were going to do with the surplus newspapers you couldn't sell. What do you do with them?”

"Well," he said, "We sell them where we can at what price we can get.'

Let the American farmer do that, put his rugged individualism to the test. Pay him for what we need. Let him produce what he will, and if he can find a foreign market for his surplus, God speed him to it. But if he can't, let him remain the punitive creat or of it and keep it on his own farm, and they will soon balance supply and demand. The CHAIRMAN. Don't our manufacturers under the protective tariff do that?

Mr. CLAIR. That is exactly what they do, but we have control. When an automobile manufacturer finds sales falling off, he can control production. How? He can call in the paymaster, pay off his workmen, pull the boilers, and close the factory gates. But the farmer can't do that. It is a seasonable proposition with him. He has to depend upon nature, and nature has got to make his crop. But you can control marketing of agricultural products. You can control the amounts that are going into the channels of trade and control that effectively, and so it is through a positive simple market control that will give him a certain fixed stabilized figure for the portion we need.

Senator THOMAS. Let me ask this question: Could the Secretary of Agriculture put this plan into effect if this bill before us should be enacted into law? I ask this question because he spoke of your plan the other day rather favorably, as I understood him.

Mr. CLAIR. Yes; I presume he could, but the bill does not specifically state the price at which these products ought to be stabilized, and I urge it upon you gentlemen to report out a bill that faces this issue intrinsically, and tell what price should be paid for such portions as we need for these basic, indispensable, nonperishable crops. To what end? The day that that is done, that day you are going to see the stock market in New York rise. Yes; you are. Millions are going to be added. Our security values have always followed these commodity prices, and you are going to see this Nation begin to go forward.

The CHAIRMAN. Now, if there are no more questions to be asked of Mr. Clair, we will have to move along. We are much obliged to you for your eloquent and illuminating statement.

Senator THOMAS of Oklahoma. I ask unanimous consent to have Mr. Clair's booklet and pamphlets inserted in the record.

The CHAIRMAN. Without objection it is so ordered.

(The documents are as follows:)

THE CLAIR PLAN TO RESTORE FARM AND NATIONAL PROSPERITY

THE NATIONAL LEAGUE FOR ECONOMIC STABILIZATION

Officers: Francis J. Clair, president; William J. Goodman, chairman of the board and treasurer; George C. Lytton, Herbert U. Nelson, vice presidents.

Chicago board of governors: Joseph Deutsch, president Edwards & Deutsch Lithographing Co.; George C. Lytton, president Henry C. Lytton and Sons, "The Hub"; William J. Goodman, vice president Horder's, Inc.; W. M. Gamble, president Gamble Hinged Music Co.; Benjamin Kulp, president Wilson-Jones Co.; Herbert U. Nelson, executive secretary The National Association of Real Estate Boards; Mrs. Julia C. Steven, president Mrs. Steven Candy Co.; J. Soule Warterfield, president Chicago Real Estate Board; C. T. Ripley, railway engineering executive; Dr. William M. Balch, Baker University, Baldwin, Kans.; Joseph F. Nichols, attorney at law, Greenville, Tex.; Charles B. Ray, commerce and trade, Glen Ellyn, Ill.

[Excerpts from the "Agricultural Marketing Act", June 15, 1929]

[Public-No. 10-71st Cong.]

[H.R. 1]

An Act To establish a Federal Farm Board to promote the effective merchandising of agricultural commodities in interstate and foreign commerce, and to place agriculture on a basis of economic equality with other industries

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. (a) That it is hereby declared to be the policy of Congress to promote the effective merchandising of agricultural commodities in interstate and foreign commerce, so that the industry of agriculture will be placed on a basis of economic equality with other industries, and to that end to protect, control, and stabilize the currents of interstate and foreign commerce in the marketing of agricultural commodities and their food products— (1) By minimizing speculation.

(2) By preventing inefficient and wasteful methods of distribution.

(3) By encouraging the organization of producers into effective associations or corporations under their own control for greater unity of effort in marketing and by promoting the establishment and financing of a farm marketing system of producer-owned and producer-controlled cooperative associations and other agencies.

(4) By aiding in preventing and controlling surpluses in any agricultural commodity, through orderly production and distribution, so as to maintain advantageous domestic markets and prevent such surpluses from causing undue and excessive fluctuations or depressions in prices for the commodity.

(b) There shall be considered as a surplus for the purposes of this act any seasonal or year's total surplus, produced in the United States and either local or national in extent, that is in excess of the requirements for the orderly distribution of the agricultural commodity or is in excess of the domestic requirements for such commodity.

(c) The Federal Farm Board shall execute the powers vested in it by this act only in such manner as will, in the judgment of the board, aid to the fullest practicable extent in carrying out the policy above declared.

SEC. 4. The board-(4) may make such regulations as are necessary to execute the functions vested in it by this act

SEC. 13. (a) The board shall, in cooperation with any governmental establishment in the Executive branch of the Government, including any field service, thereof at home or abroad, avail itself of the services and facilities thereof in order to avoid preventable expense or duplication of effort

(b) The President may by Executive order direct any such governmental establishment to furnish the board such information and data as such governmental establishment may have pertaining to the functions of the board;

***

THE CLAIR PLAN

The Clair plan is predicated on the fact that agriculture is an industry, producing certain raw materials required for food and clothing, the production of which is indispensable to human life.