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Mr. STREETER. I think so. I was talking to an old gentleman, a large shipper of livestock, and he said, "Charlie, these conditions right now are very similar to early in '71 or '72. The farmers all over this county brought in their hogs to your father, turned them over to him. There was no agreed price. Your father shipped those hogs to Chicago and farther East and he waited 6 months before he got his money from the packers. Then he got actual money, no checks or drafts, and he put it in his saddlebags and went around to these different farmers and paid them for their hogs. They grew out of that and became prosperous.'
Senator NORRIS. That operation, while it was possible, was a hardship even then, but it would be an impossibility now?
Mr. STREETER. Oh, yes.
Senator Norris. You couldn't buy corn from these farmers and have them wait 6 months to get their pay?
Mr. STREETER. They can't wait.
Senator NORRIS. That is an impossibility. You might as well forget it.
The Chairman. We are much obliged to you, Mr. Streeter.
The CHAIRMAN. We will now hear Mr. Blalock, of the cooperative organization of North Carolina.
Mr. Blalock, please state your name, address, and occupation.
STATEMENT OF U. BENTON BLALOCK, GENERAL MANAGER OF
THE NORTH CAROLINA COTTON GROWERS COOPERATIVE ASSOCIATION AND PRESIDENT OF THE AMERICAN COTTON COOPERATIVE ASSOCIATION OF NEW ORLEANS, LA.
Mr. Blalock. My name is U. Benton Blalock. I am a cotton farmer, and general manager of the North Carolina Cotton Growers Cooperative Association and president of the American Cotton Cooperative Association of New Orleans, La.
Senator Thomas of Oklahoma. Where is your farm located?
Senator THOMAS of Oklahoma. You are a cotton farmer in the main?
Mr. BlaLOCK. Yes, sir.
Senator THOMAs of Oklahoma. How much land have you planted to cotton ordinarily?
Mr. BLALOCK. Ordinarily about 300 acres. I also raise livestock and fruits and grain. As an organization the American Cotton Cooperative Association is favoring the House agricultural bill for the following reasons: First, we believe it will not only be a real benefit to our more than 248,000 members of our association but it will be equally beneficial to all cotton producers. We stand for a speedy enactment into law of the bill because our planting season is now upon us, having already started in the lower part of the belt, and unless something is done to help us control acreage, we are threatened with a substantial increase in acreage over last year's acreage. The United States Department of Agriculture is not allowed to give out a report on intentions to plant on cotton but an authority, one we consider very reliable, was responsible for the estimate that the cotton acreage will be increased this year more than 7 percent over last year's acreage unless something is done and done speedily to help us hold it down.
We are supporting this bill because it is a nation-wide bill, having for its purpose the raising of price levels of nine of our basic farm commodities. The raising of price levels on the nine major crops will eventially reflect higher price levels on all other farm commodities.
We are backing this agricultural program because it is the agreedupon proposal of nearly all of the farm organizations and cooperative associations. Representatives of these farm groups met here in Washington some two weeks ago and after much serious consideration and discussion, uninfluenced by outside agencies, unanimously agreed that American agricultural conditions were so desperate and so acute that they should be treated as an emergency proposition and that the President of these United States and the Secretary of Agriculture should be given full authority and wide latitude to lift American agriculture out of its more than a decade of depression. We need a general agricultural bill, flexible enough to handle all basic commodities. A plan that will work on one commodity successfully might not work so successfully on another, but we cannot stop here, however. If we are to look to the rehabilitating of American agriculture as a way out of this general business depression, the farm-mortgage debt of this Nation must be refinanced on a lower interest rate and easier payments, and the almighty-sacred gold dollar that this Nation has worshipped so long and so devoutly must come down off its high pedestal or some other change made in our monetary system. It is absolutely unfair and impossible to expect the farmers of this Nation to meet their mortgage indebtedness and their tax payments so long as our American dollar can buy 4 or 5 times as much of the farmer's commodities as it did in normal times.
It was brought out in the testimony yesterday how in war times we encouraged and taught the American farmer to speed up his production as a patriotic duty. In my opinion, this is one of the causes for our having overproduction today. We taught the American farmer how to operate in high gear but have not taught him how to get back into low gear in production or even into intermediate. If the situation was not so tragic, it would be amusing to listen to some of the testimony in opposition to this bill. They all claim to want to help the farmer but it is quite noticeable that the remedies they proposed usually shift the burden to some other group: Reduce the value of farm mortgages, lower the interest rates, lower the freight rates, reduce the tariff, and above all, keep the Government out of “my” business.
One of the doctors testifying yesterday claimed to represent a group of farmers. After viewing the patient, he was in favor of a policy of doing nothing, letting nature take its course. Following this course for the past several years has brought the farmer down to the condition where he is now paying 106 cents for what he is buying and receiving 46 cents for what he sells as compared to pre-war prices. We think it is high time to change the prescription if the patient is to live.
I read about the desperate plight of our western brother farmers, of their sufferings on account of low prices for their products, of their banding together in a Custer's-last-fight attitude to save their homes and farms from foreclosure, but the conditions of the cotton farmer
of the South is a stern reality to me. I know that the landlords are unable to pay their mortgage indebtedness and that rents are not equal to taxes. I know that tenants have been reduced to mere serfs. I know that farm laborers with their measly daily wage of 40 cents a day cannot even buy the bare necessities of life for themselves and their families.
It is absurd to even think of still following a policy of letting nature take its course under conditions like these. We have a President in the White House, elected on a promise to give American agriculture a new deal. We believe he was sincere in making that promise. Give him the machinery as carried in this bill and we believe that the President will carry out his promise to American agriculture.
That concludes my statement, Mr. Chairman, with the exception that I would like to show just how we are stepping up in overproduction in cotton, and I would like to have some of these doctors to advise us where we are headed if we continue to let nature take its 'course:
In 1929, July 31, 1929, we had a carry-over of American cotton of 4,517,000 bales; July 31, 1930, that overproduction had stepped up to 6,187,000 bales; on July 31, 1931, it was 8,919,000 bales.
Senator Norris. That is the carry-over you are speaking of now?
Mr. BLALOCK. No, sir. It is estimated this year we will have something in the neighborhood of 13,000,000 bales carry-over.
Senator KENDRICK. Can you give us the annual consumption of cotton along with those figures?
Mr. BLALOCK. Yes, sir. Consumption of American cotton in the world by months
The CHAIRMAN (interposing). Have you the total by years?
The CHAIRMAN. In order to show this picture as it should be, it might be well to start back about '26 or maybe '25.
Mr. BlaLOCK. 1926, the total consumption of American cotton in the world, starting with 1925–26 was 14,000,000 bales. I will give it to you in round numbers. The next year it was 15,748,000; 1927-28 15,576,000; 1928–29, 15,226,000; 1929–30, we dropped back to 13,000,000; 1930–31, and that is as far as I have the figures, we dropped to 11,113,000 bales.
The CHAIRMAN. And in '32?
Senator THOMAS of Oklahoma. How much cotton have we in the world at this time?
Mr. BlaLOCK. I think I have a report issued by the Department of Commerce on March 20 on that, Senator.
Senator THOMAS of Oklahoma. How much cotton have we on hand in the world now, all the cotton in the world?
Mr. BLALOCK. I don't believe I have those figures before me, but we have in this country in public storage and in compresses and warehouses, according to the March 20 report of the Department of Commerce, 9,379,000 bales. That doesn't take into consideration that held abroad.
Senator NORRIS. In addition to that, as I understand your testimony, notwithstanding this enormous amount of cotton we have on
hand, you have testified from reports that you consider reliable that we are going to have an increase in acreage this coming year of over 7 percent? Mr. BLALOCK. Yes, sir.
Senator NORRIS. That seems to me to make us face an almost impossible condition?
Mr. Blalock. Senator, it does, but what can they do otherwise than plant cotton? They can't raise wheat at the price it is. . They can't raise hogs.
Senator NORRIS. It seems to me we are reduced to this proposition that we must do something to enable the people to buy cotton who can't buy cotton now.
Mr. BlALOCK. I raise some hogs, I send them to a local packer not very far away, about 80 miles. The last shipment of hogs I got a little over 3 cents a pound for them. A 200-pound hog brings six or eight dollars.
Senator Thomas of Oklahoma. What commodities do you produce on your land that pay you the cost of production?
Mr. BLALOCK. Not a thing in the world that I can figure out today.
Senator THOMAS of Oklahoma. You raise nothing that pays the cost of production?
Mr. BLALOCK. No, sir. I have a small herd of cattle, small herd of sheep. I raise some hogs and a flock of hens and all. I don't get it out of anything.
Senator THOMAS of Oklahoma. I am not asking you a personal question, but presuming you were an average farmer, you would have a mortgage on your land?
Mr. BLALOCK. Absolutely.
Senator THOMAS of Oklahoma. You would have a rather high tax to pay?
Mr. BlALOCK. Yes.
Senator Thomas of Oklahoma. Assuming that we could by some legerdemain remove your mortgage, assuming that you had one?
Mr. BlALOCK. I don't mind admitting, Senator, that I do have one. Part of my land is mortgaged, not all of it, I am thankful to say, but part of it is.
Senator Thomas of Oklahoma. Assuming that we can eliminate that by some sort of legerdemain, you have no mortgage on your land now. Assuming that we can by the same unknown process
. remove all taxes against your land, you would then have no taxes. to pay and no interest to pay, no mortgage debt to pay. Could you then live on your land under present prices?
Mr. BLALOCK. Senator, I think I could answer that very clearly by quoting from a short speech I made at a tax meeting in my State not long since, at the capital in Raleigh. I briefly cited just three cases that I knew personally about of where farmers were unable to meet their tax payments. One was that of a neighbor farmer of yours, Senator Smith, in your State. He has a small farm. He told me he lived under conditions when he sold cotton at 5 cents a pound but he was able to live and get along. He said the taxes at that time were $8.50. Today they are more than a hundred dollars. Knowing the little farm, I have no doubt it takes half the cotton he can produce to pay half the taxes. Case No. 2 is that of a young man who was in my office and told me his father owned 175 acres of land.
A year ago his father deeded 25 acres and the home place to his mother. He was unable to cultivate the land and get anything out of it and he couldn't rent it and he told the tax authorities to sell the other 150 acres. I had a copy of a letter in my hand of a farmer who had written to a sheriff of a county stating that he owed $230 back taxes on about 500 acres of land. At that time the land was yielding practically no income at all. It was in a special school-tax district. His proposition was if you can get the tax authorities to reduce that tax on that land to $50, he would try to continue to hold it and pay the $50 taxes and pay up the taxes in arrears, otherwise he was ready to deed it to the school. He didn't want it.
Senator Thomas of Oklahoma. I don't believe you caught the import of my question. Some of the witnesses contend that if we would reduce mortgages by scaling them down, that would be an element of relief. Others contend that if we eliminate taxes materially, that will be an element of relief. From the testimony given here that farmers are not getting the cost of production, it occurs to me that if they had no taxes to pay and had no interest to pay that they couldn't live very long on the farm because they couldn't continue to produce at a loss, because they would have to have some money to buy clothing and buy medicine and buy the things that they must eat that they can't raise. So it would be only a question of time, even if there were no taxes and no mortgages, before the farmers would have to leave the farm or suffer, because they couldn't produce enough to live?
Mr. BLALOCK. You are correct, Senator. I might add there that I had a canvass made not long since—I did it for a purpose--I asked this question of a large number of farmers: What would you do with a hundred dollars if you had it? We were working on the domesticallotment plan. Invariably those people came back and said, “We would spend it for clothes and shoes for our families”, and in many instances they said they would spend more than that if they had it.
The CHAIRMAN. Mr. Blalock, I had you go back to 1925 and 1926. The consumption of American cotton from 1924 to 1925, 1925 to 1926—the cotton year runs from August 1 to August 1
Mr. BLALOCK. Yes, sir.
The CHAIRMAN (continuing). The consumption of American cotton exceeded production up to 1929. If you will look at the figures, you will find that.
Mr. BlaLOCK. Yes; I think you are correct on that.
The CHAIRMAN. The price was fairly remunerative. From 1929 on through these 3 years, in spite of the fact that the crop has not as an average exceeded the previous production per year, the consumption dropped off until where the surplus piled up at the rate of a million and a half to two and then to three million, until as a result of underconsumption we are now faced with a world supply of American cotton of around 12,000,000 bales.
Mr. BLALOCK. As much cotton as we could consume if we didn't consume a bale this year.
The CHAIRMAN. More than 5,000,000 of which are in this country. Therefore, if we produce a normal crop this year and there is no relief given to those who consume our product, if there is no rise in price, no more general distribution of money, why, we are just hopeless and it looks to me as though if there isn't something done toward curtailment of production and an increase in the price of that which is pro