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Mr. BROUSSARD. We are, Senator. Of course, that 25 percent surplus must be sold in markets in competition with China and Asiatic rice, which of course is on a silver basis.

The CHAIRAMN. Your rice is on an exportable basis now? Do you produce more than is consumed in this country?

Mr. BROUSSARD. Twenty-five percent more than we can consume, and that regulates the price of what we do consume in the country. That is why we are selling rice so cheaply. It is a case of shipping it out of the country, and that is the pendulum that puts the market. on our domestic consumption.

The CHAIRMAN. You say it is about 15 cents a bushel under cost of production now?

Mr. BROUSSARD. Under cost of production; yes.

The CHAIRMAN. Now, you say you are a miller and a grower. Then under the terms of this bill, that tax, that equalizing tax, or the parity tax, would be 15 cents a bushel. That is the object, to bring it up to parity. I do not know what your parity was between 1910 and 1914.

Mr. BROUSSARD. It was considerably higher than that, but I believe the reduction in the production, cutting acreage and reducing production, would fix it so that you would not have to pay probably more than 3 or 4 cents.

The CHAIRMAN. Have you investigated to see what that parity price would be per bushel?

Mr. BROUSSARD. It would be about 40 cents a bushel.

The CHAIRMAN. No; I mean the parity price.

Mr. BROUSSARD. The difference between the price now and what it was in the pre-war period?

The CHAIRMAN. What is the estimate of the price to which you will have to raise a bushel of rice under this bill?

Mr. BROUSSARD. Eighty cents a bushel.

The CHAIRMAN. You raise it to 80 cents?

Mr. BROUSSARD. Yes; increased about 50 cents.

The CHAIRMAN. Therefore, you would have to raise it from 30 cents a bushel?

Mr. BROUSSARD. Yes, sir.

The CHAIRMAN. Therefore, you as a miller would have to pay a tax of 30 cents a bushel to get the rice that you would treat domestically-I mean the rice that you would mill for domestic purposes.

Mr. BROUSSARD. The rice growers and myself feel that there is one part of that bill where it provides for reduction of acreage by retiring acres from production. That will be the simple way to do it, because you will eliminate 200,000 acres with $600,000.

The CHAIRMAN. But you must remember that the operation of this bill does not contemplate taking the allotment plan and the leasing plan in the same place and with the same individual. They will work one where it is convenient and will work the other where that is convenient. Are you addressing yourself to the leasing plan or to the allotment plan?

Mr. BROUSSARD. I am addressing myself to the plan that is now proposed, that gives the Secretary of Agriculture, as I understand it, the opportunity of going either way; he can take whichever way is most convenient.

The CHAIRMAN. Exactly. Which way will be the most convenient to you?

Mr. BROUSSARD. The most convenient to me and to the industry would be on the leasing plan.

The CHAIRMAN. Rather than on the allotment plan?

Mr. BROUSSARD. Yes; because as a processor I would have to pay on every bushel of rice that we mill a certain percentage or a certain percent per bushel to pay the acreage rental.

The CHAIRMAN. Under the allotment plan you would have to pay 30 cents a bushel to bring it up to the pre-war parity?

Mr. BROUSSARD. Yes. Well, I believe there is a way in that bill that you can go either way. It is rather up to the Secretary, is it not? The CHAIRMAN. Yes.

Mr. BROUSSARD. Well, from my standpoint I would say the retiring of the acreage would be the simple, easy method of doing it. The CHAIRMAN. Have you read the bill?

Mr. BROUSSARD. Yes.

The CHAIRMAN. And you see it is clear and fair with the farmer; he can take either plan?

Mr. BROUSSARD. Yes.

The CHAIRMAN. I just wanted the committee to be advised as to which plan you preferred in your business.

Mr. BROUSSARD. My preference would be the retiring of the land from production, because that is simple, easy to work, will not cost anything hardly. The machinery for doing that is practically on the ground.

The CHAIRMAN. And that would get rid of it, temporarily at least. Mr. BROUSSARD. Temporarily. That is not the final panacea, but that will correct it for the next 2 years.

Senator BANKHEAD. What is your average acreage in production? Mr. BROUSSARD. About 850,000 acres.

Senator BANKHEAD. What is the average domestic consumption? Mr. BROUSSARD. About 30,000,000 bushels. You take 25 percent of that, 700,000 acres, would just about produce what we can sell in this country and export. That would still leave us on an export basis, but we can export a million pockets of rice at a high price.

Senator MCNARY. Where is your foreign market?

Mr. BROUSSARD. In Germany, England, France, Argentine Republic-all over the world.

Senator NORRIS. What countries do you come in competition with in Germany?

Mr. BROUSSARD. We come in competition with all of them. The only difference is that they prefer they can use a small quantity of our high-grade rice-we raise the highest grade rice in the world.

Senator NORRIS. So the competition from China is not real competition for that grade?

Mr. BROUSSARD. Not for that grade, but Italy and Spain grow a high-grade rice that comes in competition with ours.

The CHAIRMAN. That is an interesting statement you made. You say that you can export profitably about a million bushels?

Mr. BROUSSARD. Yes; a million pockets. That is more than a million bushels. There is 100 pounds to a pocket-that is clean rice I am talking about-that would be about 3,000,000 bushels of rice. The CHAIRMAN. That is about what percent of the crop?

Mr. BROUSSARD. That would be about 10 percent.

The CHAIRMAN. Therefore, you could raise for export purposes 10 percent more than domestic consumption and still do a very comfortable business?

Mr. BROUSSARD. Yes; still put rice on a paying basis.

The CHAIRMAN. And therefore you would like to have the leasing system apply to your business?

Mr. BROUSSARD. Yes. It will work. There is no question in my mind about that, and it will not cost anybody any money. The difference to the farmer is that on 30,000,000 bushels he will get nearly twice as much money as he gets now for the 40,000,000 bushels. The CHAIRMAN. Rice lands are not very profitable planted to any other crops, are they?

Mr. BROUSSARD. No, sir; there is no other crop that you can plant on rice land profitably. You can grow cattle on it. That is what I do. We grow cattle on our lands that lay idle, and you have got to lay land out, you have got to have 2 acres in the rice business where you ordinarily would have one in any other crop, because it is not profitable to plant the acreage year in and year out. I plant one year, then lay it out and plant it again the second year. You have got to have 2 acres where with other crops you would only have to have one, and we have stock on our lands that are laid out.

Senator POPE. What effect would that have on the consumer-the price to the consumer?

Mr. BROUSSARD. The price to the consumer will not be very much advanced, because in a large portion of the United States there is a spread between what the farmer gets today and what the miller gets and what the consumer pays, enough to take care of that additional price. Of course, in our immediate vicinity, where they sell rice awfully cheap, it would raise the price there somewhat.

Senator FRAZIER. There ought to be some regulation, should there not?

Mr. BROUSSARD. No; let them pay more for it, because they would be getting more for it.

Senator FRAZIER. The retailer would raise the price again, on the same theory?

Mr. BROUSSARD. Well, I say the consumer can pay more for it, because it will put him on his feet. I am speaking about in the Rice Belt, where we sell awfully cheap, 2 cents a pound, or a cent and a half a pound or a dollar a hundred. I sell lots of rice for a dollar a hundred.

Senator MURPHY. Did you ever figure out what it costs us when we buy it in packages?

Mr. BROUSSARD. Package rice comes high, because they put in a little better quality of rice and standard quality, and you are paying for quality then, you see. If you go down to the store you will not go to a cheap store to buy clothing, but you go where you can get a better grade. The other will last you just as long, but that is the way it is in rice; if you buy in a package you buy a little higher quality of rice, and for that reason you pay for it. It is a better grade of rice and you would pay a little more for it in the package, but probably the farmer would get twice as much for his rice. Are there any further questions?

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STATEMENT OF LH MERCER STATE LIVESTOCK COMMISSIONER. TOPEKA, KANS.

Mr. MERCER. Mr. Chairman and gentlemen. I am breswek gomissioner of the State of Kansas, also a feeder of cattle and bogs. and I am here representing the Kansas Livestock Association, an organization of Kansas, with a membership in quite a large number of states acjaring

I did not prepare any statement. I have been in the livestock business about an my life and have paid a good deal of attention to the marketing of the industry. I appeared before the House ecomittee, the Agricultural Committee of the House, recently on the alotment bill. The position of our organization is that we are anxious that any legislation shail be enacted that will be helpful to the farmers in general, but we have studied the plan of the allotment bill. I co not know just how much of those features are embodied in this bill. but we do not think it is workable as it applies to livestock. I cannot see how such a complicated industry could come under the provisions of a bill of that kind.

I have some thoughts, of course, about the plan that might be worked out in connection with being helpful to the livestock industry. I belong, of course, to several livestock organizations, and I believe that with an organization and something like the powers that are delegated to the Secretary of Agriculture, he could have authority to delegate the work or receive the support of an organization something like the National Livestock and Meat Growers, that is made up of all branches of the livestock industry, including packers, processors, and producers and breeders, sales agencies, and so forththat an organization of that kind, with the authority, the Secretary having the authority to work out a plan, would be of a constructive nature, and in my opinion it largely depends on the merchandising of our business, insofar as prices are concerned, even now.

It is my opinion that if we have what has been termed "an orderly marketing", we would have more control over the movement of supplies and also the movement, probably, of the finished product; that we could have the prices of the raw material gradually increased, and that the consuming public would absorb it without any particular notice in any way; but it would have to come in a sort of an orderly way and it could be handled, in my judgment, without any particular cost to the Government, and I believe that if something of the kind could be inaugurated, the prices of livestock, meat animals especially, could be increased very nearly 100 percent over the present prices, and the consuming public would absorb it and would not notice it at all. I base that declaration on my observation of the business over forty-some years. I have been a feeder of cattle and hogs all my life. I have cattle to feed now. The business has been very, very

discouraging and people are going under with very heavy losses and have been for more than 2 years, but it is not because, gentlemen of the committee, in my judgment, of our oversupply. I do not think we are oversupplied with meat animals. I think the records show that we are even not up to normal, and of course there is a large number of our people who are out of work; most of them are meat eaters, and to bring about the employment of our people will certainly increase the prices of food in this country.

The question was asked here by one of the Senators as to what had been done by the Government to help agriculture. In my opinion, the greatest good to agriculture that this Congress has done, or that any Congress has done, is the amendment to the Reconstruction Finance Corporation allowing the Corporation to set up regional credit corporations loaning money direct to the livestock industry; and the reason why I suggest a set-up of men engaged directly in the business is because of the results of the corporation set-up in our land-bank district. I happen to be a member of the board of directors of that set-up, and every man on it is a livestock producer. We have 1 or 2 bankers, and I feel we have made a success in that territory. I am positive that by reason of the use of Government money in the ninth land-bank district it has advanced the price of stocker and feeder cattle to as high a level as is warranted now under the conditions. The price has been advanced on cows from $10 to $15 a head, breeding cows, $1 a hundred to $1.50 on stocker and feeder cattle, and it certainly has been of great consequence to the people in our section. It has been a wonderful help to our farmers, and when we speak of the livestock industry, gentlemen, we speak of the farmers of our country. You talk about the dairy interests and the beef interests, the hog raisers, and so forth, the great bulk of our farmers are engaged in all classes of livestock business. They have some dairy cows and they have some beef cows and they raise hogs. So it helps them all along the line, and it certainly has been of great consequence in our section.

If Congress could fix up something along the same line to help in the financing of the farms and the real estate of the country, it seems to me it would be far better than to try to create something of a complicated nature, although I am not here to say one word against any provisions of this bill, only as it applies to livestock, and we are certainly anxious to have any help that can come through that feature; but, gentlemen, as I see it, and as a producer all my life, I cannot see how we could control the supply of livestock by any scheme that has been set up here by either one of these bills.

I think, in connection with this set-up, that probably the Secretary should have someone representing his Department set in on these groups and also more than likely the Attorney General should have, because there is no question but that because of this emergency, in undertaking to work out a plan of this kind it would have to be some agreement that might conflict with our antitrust laws.

I think, Mr. Chairman, that is about all I have to say. The CHAIRMAN. We are very much obliged to you, Mr. Mercer. Now, I want to state to those present, there are a few here who would like to be heard, and as this is the last meeting at which there will be hearings, Congressman Shoemaker, of Minnesota, desires 5 minutes, and the committee will be glad to hear him at this time.

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