perhaps the only reason for the delinquency is that the number of dollars required to be paid each 6 months is too large, and it could be lowered by extending the loan over a little longer period.

Senator MILLER. You do provide for variable payments? That is a very good provision.

Mr. BLACK. Yes; by using variable payments there would be a lot of those loans which it would not be necessary to refinance.

Senator MILLER. That is one of the difficulties in the Federal Land Bank System now: They do not provide variable payments in accordance with the income of the farmer.

Senator BYRNES. I have a question that has been submitted to me by Senator Taft. He desired me to ask the witness the question [reading]:

I understand there were about 15,000 people at the Wallace farm-credit meeting recently held at St. Paul. Can you tell us whether or not a great many of them were A. A. A. committeemen? Did any of these committeemen attend the meeting at Government expense? That is, were they paid for a day's work? Did they receive mileage or travel allowances?

Do you know of the meeting that the Senator has in mind?

Mr. BLACK. He is conservative in his number. There were probably 20,000 there.

Senator BYRNES. What was the meeting?

Mr. BLACK. It was a meeting where the Secretary made a speech on the farm-credit situation.

Senator BYRNES. By whom was the meeting called?

Mr. BLACK. It was called by the National Farmers Union and certain affiliated cooperatives.

Senator BYRNES. His question is, "Can you tell us whether or not a great many of them were A. A. A. committeemen?"

Mr. BLACK. That I do not know.

Senator LA FOLLETTE. There are not that many committeemen in that area, are there?

Mr. BLACK. Oh, I think there are probably about 100,000 over the United States.

Senator LA FOLLETTE. Yes; but they did not all come to St. Paul to hear the Secretary's speech.

Senator BYRNES. If so, he is a pretty good drawing card for the committeemen.

Senator BANKHEAD. You are not connected in any way with the A. A. A., are you?

Mr. BLACK. No, sir.

Senator BYRNES. I am asking the questions inasmuch as Senator Taft is not present.

The next question is [reading]:

Did any of these committeemen attend the meeting at Government expense? That is, were they paid for a day's work? Did they receive mileage or travel allowances?

Mr. BLACK. I have no information on that.

Senator WHEELER. I might say that I spoke, a very short time ago, at a Farmers' Union meeting, with the Secretary, similar to the one that the Secretary spoke at in St. Paul, I am sure, and they all came in voluntarily. They were members of the Farmers' Union.

Senator BYRNES. These questions I have asked for Senator Taft. On my own account let me say that if Senator Wheeler was present they would be willing to come without travel allowances.

Senator LA FOLLETTE. In fairness to the Farmers' Union which sponsored this meeting I would like to suggest that that question be directed to the Secretary in order that we might have a prompt answer. I am not sure when he will be here.

Senator BYRNES. I am submitting the question, Governor, which is in writing, and you might ask the Secretary if he cares to answer it in writing. Or you can put the answer into the record as part of your statement.

(Questions were referred to the Secretary for reply and the following information was submitted for the record.)

Hon. JAMES F. BYRNES,

United States Senate.

DEPARTMENT OF AGRICULTURE,
Washington, May 16, 1940.

DEAR SENATOR: The Farm Credit Administration sent in to me a copy of the question submitted to you by Senator Taft at the time Governor Black appeared before your committee. The original question as submitted is returned to you herewith, and I am making the reply you requested that we give you for transmittal to Senator Taft.

Our records would never disclose whether or not members of community and county Agricultural Adjustment Administration committees were in attendance at the meeting in St. Paul, because if they so attended they did it entirely as citizens, at their own expense and on their own time. These committeemen work for the agricultural conservation associations on a per diem or part-time basis, and of course have a great deal of free time. We have a record of their activities only insofar as those activities are involved in the local administration of the program, Certainly no persons who are county or community committeemen were authorized to attend the St. Paul meeting in connection with their official duties or to do so at Government expense. Certainly no proposal so to attend the meeting ever came up for consideration administratively in any quarter. No salary, travel, or mileage allowance has been authorized for any committeeman for attendance at the meeting. We audit expense accounts for all county and community committeemen monthly and if in the course of that audit there should be found at any time any salary, travel, or mileage allowance submitted for time or expenses in connection with attendance at the St. Paul meeting or any other nonofficial activity, exceptions will be made and the amounts disallowed.

Sincerely yours,

H. A. WALLACE, Secretary.

Senator BYRNES. Are there any further questions?

Senator WHEELER. I was going to suggest this. On page 22 of the bill, paragraph (b), it seems to me that if you would strike out, beginning on line 20, after the word "farming," "of a type which the Governor deems can be successfully carried on in the locality in which the property is situated," that would really strengthen the legislation. Mr. BLACK. Yes.

Senator WHEELER. So that it would read [reading]:

Whenever the Governor finds that any property otherwise eligible for refinancing or repurchase under the provisions of sections 10 to 13, inclusive, of this act, is either too large or too small to constitute an efficient farm-management unit or requires land or building improvements necessary to enable a diligent farm family to carry on successful farming, he is authorized, on behalf of the Corporation, to make the improvements—

and so forth.

Senator BYRNES. If it is not the wise thing to do, he should not refinance. It just lays you open to criticism if you are telling the farmer what he should plant and how he should plant and how much he should plant.

Mr. BLACK. Yes; there is one other comment which I would like to make. There has been some doubt raised as to the sphere of the proposed committees and of the national farm loan associations. I

think there has been some doubt raised as to whether it might not be possible under this legislation to use committees to the exclusion of the national farm loan associations and, in that way, put the national farm loan associations out of operation. In reading this I should think there was no such intention. But if the committee desired to change the wording of the bill to make that clear, I think it might be desirable to do so.

Senator BANKHEAD. I would like to have it done, I am sure.
Senator LA FOLLETTE. There was no such idea in mind.

Mr. BLACK. In reading the proposed legislation I did not get that idea, but there does seem to be some doubt with respect to it. Senator LA FOLLETTE. It would be easy to allay that fear.

Mr. BLACK. For my part I should be glad to see some language which would require that the associations be used.

Senator BANKHEAD. And the board of directors?

Mr. BLACK. Yes.

Senator MILLER. Governor, do you have any figures on the number of farm bankruptcies that are now pending under the present law which may be applicable in this bill?

Mr. BLACK. We have figures on the number of foreclosures that are pending or in various stages.

Senator MILLER. I am not talking about the foreclosures. I am talking about cases where the farmer is now seeking to avail himself of the provisions of the Frazier-Lemke Act.

Mr. BLACK. No; I do not have those figures.

Senator MILLER. I would like to have those figures in the record, for this reason. That is the law today, but we are providing in this bill for suspending the operation of that law and substituting in lieu thereof a system of adjustment as provided in this bill. I should like to know the number of farmers who are now seeking to take advantage of the act, which is more or less cumbersome-and I say that with due deference, because I worked on it myself.

Mr. BLACK. I am not sure we can get that information.
Senator BYRNES. I am wondering where you would get it.
Mr. BLACK. We will make an effort to get the information.
(The statement follows:)

BANKRUPTCY CASES PENDING UNDER SECTION 75 OF THE BANKRUPTCY ACT AS OF JUNE 30, 1939

According to the Annual Report of the Attorney General of the United States to Congress for the fiscal year ended June 30, 1939, there were 4,372 cases of bankruptcy pending under section 75 of the Bankruptcy Act. Of this number 2,215 represented amended petitions filed under the Frazier-Lemke Act. (See table 3c, p. 230 of the Attorney General's Report.)

Senator MILLER. What is the status of the debt-adjustment committees?

Mr. BLACK. I do not think they are very active now. They are still in existence in some areas.

Senator MILLER. Do they report to the Secretary of Agriculture? Mr. BLACK. Through the Farm Security Administration.

Senator MILLER. Don't you think you could get the information from them?

Mr. BLACK. It is conceivable that they might have it. We will see if we can get any information bearing on that.

Senator MILLER. I do not want you to go to any expense, but I would like to know, if possible.

Senator BYRNES. It would be difficult to get it from the courts.
Mr. BLACK. No; you could not do that.

Senator BANKHEAD. The suggestion has been made to me that the financing part of the bill should be limited to mortgages now outstanding and not cover future mortgages. Have you any thought about that?

Mr. BLACK. I have not given any thought to that.

Senator WHEELER. It has not been suggested to me, but I am not at all sure but what it would be a good thing, because, after all, you are dealing with the present situation.

Senator BANKHEAD. One that has been brought about by facts already occurring.

Senator WHEELER. That is right; and I am inclined to think that it might strengthen the bill.

Senator MILLER. On the other hand, if there is any justification for taking this procedure as to existing mortgages, it is because of conditions over which the borrower had no control, and those same conditions may apply to a borrower today or tomorrow with equal force and with the same disastrous effect.

Senator BANKHEAD. That might be covered by an amendment. Senator BYRNES (chairman of the subcommittee). Suppose we recess until 10 o'clock tomorrow morning. We will use this same

room.

(Whereupon, at 11:55 a. m., a recess was taken until tomorrow, Wednesday, May 8, 1940, at 10 a. m., to meet in room 310, Senate Office Building.)

FARM CREDIT ACT OF 1940

WEDNESDAY, MAY 8, 1940

UNITED STATES SENATE,

SUBCOMMITTEE OF COMMITTEE ON BANKING AND CURRENCY,

Washington, D. C.

The Subcommittee on Agricultural Finance, Farm Mortgages, and Related Matters met at 10 a. m., pursuant to the recess, in room 310, Senate Office Building, Senator John H. Bankhead presiding.

Present: Senators Bankhead (presiding), Radcliffe, Miller, Clark of Idaho, and Frazier.

Present also: Senators Wheeler and La Follette.

Senator BANKHEAD (presiding). The hearing will come to order. I sent a telegram, by authority of the chairman of the subcommittee, to Mr. O'Neal, president of the Farm Bureau Federation, inviting him to be here this morning or to send a representative. I received word from Mr. O'Neal stating that Mr. R. E. Short, president of the Farm Bureau in Arkansas, would be here to appear for the Bureau. Come around, Mr. Short, please.

STATEMENT OF R. E. SHORT, REPRESENTING AMERICAN FARM BUREAU FEDERATION, BRINKLEY, ARK.

Mr. SHORT. Mr. Chairman and gentlemen of the subcommittee, at the request of President Edward A. O'Neal, in response to an invitation from Chairman Byrnes, I appear here today to present a statement on behalf of the American Farm Bureau Federation relative to S. 3509.

First of all, may I state for the record that the American Farm Bureau Federation is a national organization of farmers, supported by membership dues of farmers representing in its paid membership approximately 1%1⁄2 million persons in 39 States. The policies of our organization are democratically determined by the voting delegates elected by the several States on the basis of membership.

During the past 20 years, we have given special attention and study to farm credit problems. Last year a special national committee was set up by President O'Neal with representatives of every region of the United States, to give special study to farm credit problems and make recommendations to our annual meeting in December. It was my privilege to serve on this committee representing the southern region. This committee held two conferences in Washington and another meeting in Chicago. While in Washington we conferred with Governor Hill. Land Bank Commissioner Goss and other officials of the Farm Credit Administration, W. W. Alexander, head of the Farm Security Administration, Secretary Wallace, Dr. A. G. Black (now

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