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Senator McGILL. That private venture is one that was contemplated for all kinds of crops? Mr. RUTLEDGE. Yes.

Senator McGill. Or you did not just take one crop that there were very good statistics on?

Mr. RUTLEDGE. No; it would cover all normal farm crops and all the hazards. But that does not mean that the Government cannot work one out. I do not mean to give that impression at all. But we have really studied it, studied it seriously.

Here is another thing that has been studied quite seriously. That is health insurance, or death from all causes, of livestock, and so far it has never been worked out successfully as a private venture. There are some conditions there that just don't seem to work in with an insurance scheme.

Senator POPE. What seemed to be the principal difficulties in the attempt to work out an oil-risk crop insurance?

Mr. RUTLEDGE. The great difficulty was this: The hog proposition, health insurance on hogs, we will say, death from any cause probably will give us a better example than the crop itself. Here is a company offering to furnish hog insurance at a certain price, death from any cause. Well, all of these men in here, in this area, where they haven't had any hog cholera, haven't had any catastrophic loss of any kind, the low rate that you would have to charge to make it workable does not interest them. It is too high, in their opinion. But on the other hand, these other groups where they have had these catastrophies or the beginning of them, they all flock to it, and your rate cannot be made chargeable on the basis of castastrophy.

Senator McGILL. In other words, you cannot spread your insurance out over a wide enough territory?

Mr. RUTLEDGE. No. In other words, it is the same thing in the crop. Here is a section affected by chinch bug, a section here affected by Hessian fly, a section here affected by some other thing, more or less catastrophics. I think it is all right to make it, and I am going to make the statement that the great request for that kind of insurance will come from areas that have that possibility. If they do not have, they will be a little more reluctant to take Government crop insurance, quite a little more.

That has been the difficulty, to get it well enough distributed. It has always shown that it would be bunched, because of an extra risk, a catastrophic risk of some kind that did not occur regularly, and you can't estimate it or base a rate on it.

Senator McGILL. That is true even of hail insurance. Mr. RUTLEDGE. Yes, and I am frank to say to you that some of the insurance companies that have made a success of hail insurance only have been able to do so because of their ability to sell where they have not had hail losses. It is because they have not, have unfortunately passed out.

Senator McGill. Many mutual companies passed out just on that account, did they not?

Mr. RUTLEDGE. Yes.

Senator MCGILL. How would you have the matter handled so as to arrive at the average yield other than by a local committee? How would you go about it?

Senator POPE. Of course, they would have records in the various States.

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Senator McGill. I mean the insured. We are seeking to determine how much, after a man has taken a policy, how much wheat he produced per acre in a certain year. How are you going to determine that except by local committees?

Mr. RUTLEDGE. If the local committee had a large enough area so that there could not be but just a very small portion of it which would be the personal, intimate territory of one of them, you would eliminate the difficulty to a great extent, but I understood it was to be a township organization, the same as they had in the A. A. A. That is the plan. That is what I am thinking of, just getting it down to as small a unit as that. If it is in more than a county unit, two or three county units—and I don't know why a group of men could not handle it just as well as several groups—you would eliminate a good deal, practically all of that personal contact.

Senator McGILL. Don't you think that would be true if it was a county unit?

Mr. RUTLEDGE. There are a good many men that are pretty well known in a whole county, pretty intimate with all the people in the county.

Senator POPE. Would it not be comparable to an assessor going out and making assessments among his friends and his constituents? I think very generally the assessors are pretty fair in their conclusions.

Senator McGILL. That is true, Senator, but of course the assessors have been taking these statements, most of these statements to which the witness referred, as I understand it, as to how much corn was planted, how many acres, how much was produced and so on. But much of that is not for the purpose of levying a tax but it is to get information, and there is no liability on the part of anyone for any erroneous statements. There isn't any inducement to make an erroneous statement.

Senator POPE. Except that there might be some inducement under the crop-insurance plan.

Senator McGILL. If there is insurance, then the inducement is there, but up to the present time--I know in my State we get all this information, and much of it is just for information, no tax being levied whatever. It is not for the purpose of taxing anybody.

Mr. RUTLEDGE. It is in Iowa. All this that I have given you is just information. It has nothing to do with taxation, and there is a difference, because in the one case you have a possible payment of loss. Now, in the case of assessors you do uave a value for taxation, that is true, in certain things, but not in this one of how much crop.

Senator MCGILL. You really have no suggestion, outside of some sort of a committee, either country or a given territory, to determine average yields?

Senator POPE. I think the crop reporting board, who is now represented by Mr. Shepherd and Mr. Jones, as I understand it, who are here, might give us some rather interesting information on how they proceed.

Senator McGILL. How they have proceeded in the past?
Senator POPE. Yes.

Mr. RUTLEDGE. I am only raising the point. That is a very delicate thing. I don't know what will cure it exactly.

Senator MCGILL. This gentleman is giving us his testimony on the basis of experience in insurance.

Mr. RUTLEDGE. Yes.

Senator MCGILL. I think that may be quite different from the methods heretofore used in order to determine how much a county produced or certain territory produced.

Senator POPE. Well, if there are no further questions we want to thank you, Mr. Rutledge, for the information you have given us. It has been very helpful to the committee. Mr. O'NEAL. Mr. Chairman, could I be heard before the committee? Senator POPE. Whom do you represent? Mr. O'NEAL. I represent myself, John R. O'Neal, 4420 Fourteenth Street.

Senator POPE. How much time do you want?
Mr. O'NEAL. Just 10 or 15 minutes.

Senator POPE. Very well. Please state your name and your business.

STATEMENT OF JOHN R. O'NEAL, 4420 FOURTEENTH STREET NW.,

WASHINGTON, D. C. Mr. O'NEAL. My name is John R. O'Neal, 4420 Fourteenth Street NW., Washington, D. C. I have no business. I am a retired farmer.

Mr. O'NEAL. I have been a farmer all my life except for a few years, and the farmers of America from 1910--I am stating this from memory; I haven't got the statistics because I did not expect to come before the committee—the farmers from 1910 to 1933 raised bread products for American consumers for 1.45 cents a day. From 1910 to 1917 wheat averaged 98 cents a bushel, and in that period you could buy what we used in the East here, a 7-foot binder, at a cost of $115. From 1910 to 1917 it took 117 bushels of wheat to buy a binder. Now, I will just leave out a few war years when wheat went to $2.20 and a binder cost $225, and advanced overnight from $115 to $225. In 1915 you could buy a binder for about 100 bushels of wheat, and from the period 1921 to 1929 wheat averaged $1.12 a bushel. It advanced 14 percent. Binders all during that period sold for $220, except 1 year I think, and that was $230. During that period in the Coolidge and Harding administrations it took 200 bushels and 30 pounds of wheat to buy a binder, and as time went on it got worse until in 1932 wheat averaged 29 cents a bushel in the United States. It took nearly 600 bushels of wheat to buy a binder. And the farmers who have raised the bread products for the American consumer come nearer fulfilling the Lord's prayer than any people in the world “Give us this day our daily bread.”

Well, they just about gave them their daily bread, and not satisfied with that, they wanted them to give them their daily meat. During that time they raised the meat for the consumers in this country for 2.74 cents a day. I didn't get but barely enough from raising the bread and the meat for the consumer a day to buy a 4-cent stamped envelope.

Senator MCGILL. Where were you located? Mr. O'NEAL. I was located in Virginia. I am a Virginian. But I am talking about all the farmers in America.

Senator McGill. Well, I think we all know that prices were down for farm products. I don't think there is any dispute about that. I know when wheat sold as low as 18 cents a bushel.

:: Mr. O'NEAL. Yes. Then I have been in farm meetings. I was in the 1935 corn and hog meeting of farmers from the West, and when the Supreme Court invalidated the A. A. A. I was in the meet ing that Secretary Wallace called here to write up the farm bill, not as a participant but as an onlooker.

I asked Secretary Wallace to come to that meeting and give me the privilege of being present. I didn't vote in the meeting. And when they called the men here from the West on this wheat proposition I was in that meeting. I asked the man here who was head of the meeting, the wheat man-I forget his name-I asked him to come to the meeting and he gave me the privilege to come down to the meeting, and when we gave in our names and whom we represented I gave him my name, and that meeting took a vote to leave me in the meeting or put me out, and they left me in the meeting. You understand, I could not participate by talking or voting in it. The reporters were not allowed in that meeting, and I never spoke a word in the meeting. I see one man here who was in that meeting. Do you recall when they voted on leaving O'Neal in the meeting or turning him out?

Senator Pops. Well, that is not important. If you have any information on this matter let us have it.

Mr. O'NEAL. I have been in the Senate for over 9 years in the galleries and in your committees, and when I was in there and saw their deliberations and what went over, the thought came to meand I have been following the Senate closely in the last 9 years—for the last 30 years, so far as that is concerned—I could not understand why a bunch of farmers would have a Congress in the United States for the last 25 years that wouldn't do anything at all for the farmers.

Senator McGill. I think it is pitiful.

Mr. O'NEAL. I could not understand how men with the ability that we have, that went from 1910, the farmers that raised the meat and bread for this country for nothing, and there was nothing done for them, practically nothing, until this Administration, and I think if you gentlemen will just cut out information like some of this you have been getting here and just take the farmer's view of it, they know what they want and they will pretty near give you in resolutions what they want, and instead of getting statistics in here from people who are not interested in farming it will be much better for the farmer and for all of us as a whole. I thank you, gentlemen.

Senator POPE. We will now call Mr. Shepherd, if he is here.

Mr. SHEPHERD. Dr. Jones is with me. We have both grown gray in the crop-reporting service.

Senator Pope. Mr. Jones, you might come forward, too.

Mr. SHEPHERD. Mr. Orr, who is particularly charged with wheat, may be over shortly. STATEMENT OF JOHN B. SHEPHERD AND SAMUEL A. JONES,

CROP REPORTING BOARD, DEPARTMENT OF AGRICULTURE Mr. SHEPHERD. Mr. Jones and I are both members of the Crop Reporting Board.

Senator McGill. When you say "Crop Reporting Board”, is that in connection with the Bureau of Agricultural Economics? Mr. SHEPHERD. Yes, sir.

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Senator POPE. Yesterday a question was raised as to the methods used in your crop reporting. Senator McGill, for instance, asked a question as to how you arrived at a yield on an individual farm in a State. What method do you use and how accurate can you arrive at your data?

Mr. SHEPHERD. For an individual farm?
Senator POPE. Yes.

Mr. SHEPHERD. Practically we deal not at all with individual farms except this, speaking now particularly of yields, acreage production forecast, acreage seeded in the fall.

Now, taking just yield per acre after harvest. We depend primarily on the judgment of crop correspondents as to the probable average yields in their respective localities. We have to check that up against fields of quite a large number of individual farms, their acreage and their production. Of course, we take simply their judgment on it, and if we find over a period of years that the forecast that comes to us in that form averages a little high in comparison with the census or other indications, our estimate then in those States will be a little below what our crop correspondents give. But in the case of wheat, as I recall, in the major wheat-producing States our yields per acre as reported to us by crop correspondents, come pretty close to the true figures, as near as we can determine it.

Senator POPE. Do you have these crop correspondents located at different points in the State?

Mr. SHEPHERD. Yes; we secure an average of, I would think, altogether around 27,000 or 28,000 each month during the growing season. Those men are scattered everywhere throughout the country, picked pretty much to try and give a proper geographical distribution for each State.

Senator MCGILL. It is on their report that you base your estimate as to what a crop yield will likely be before the crop is harvested?

Mr. SHEPHERD. Vo; before the crop is harvested we depend more on what they report in terms of conditions. Now the statistical data back of that. You get some irrigated land and dry land mixed together. These men report probable yield—well, he has got a rank growth sometimes, and they are very optimistic, and then rust comes along, and what they reported as probable yield is not at all the final yield. But we try to compare with similar yields. If they report 60 or 70 or 80 percent condition we try to compare with other years when somewhat similar conditions prevailed. If there is rust danger or lack of subsoil moisture or what not, we try to match it as near as we can and use everything we have, and we have more or less condition records way back to the sixties, as near as we can on the basis of past experience and their judgment of what they expect, and we put down what we think the yield is going to be in bushels.

Senator MCGILL. Then from these correspondents you determine what the yield has been after a crop has been harvested and threshed?

Mr. SHEPHERD. After it is harvested we have their judgment of the average yield per acre, and we get for their own farms their acres and their production.

Senator McGill. Of course, you also recently had the benefit, I assume, of those who were in under the Agricultural Adjustment Act, in determining the actual yield, did you not? Did you get that information?

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