young men for some few years. The president and myself are schoolmates together, and I am going to ask both of them if they will please come up and give any observations that they would care to at this time. Mr. Turner Gilmer and Mr. Claude Bordwine.

The CHAIRMAN. Mr. Gilmer and Mr. Bordwine, we are delighted to have you.

STATEMENT OF TURNER A. GILMER, JR., PRESIDENT, VIRGINIA BURLEY TOBACCO GROWERS ASSOCIATION

Mr. GILMER. I do not have too much to say. I want to make some observations. I was a member of this Eight State Committee that you heard of a good deal, and I want to endorse their proposals in their entirety. I am sure that the growers in the State of Virginia would be in entire agreement with all of those proposals.

I would like to bring out one other thing that came up in the Eight State Committee that probably might not be in the report.

When we first got together, we agreed that as one body or as one entity that the burley tobacco program was a good thing, that it has done much good in the past, and if properly revised and carried out, will do much in the future. The fact that it is a good thing for the producers of burley tobacco and the communities that are in the burley area has been more pointedly brought out in the last 3 or 4 years.

If you will let me use a personal example, in the area that I live in, we have three main sources of agricultural income. We have feedercattle production; we have spring-lamb production, and we have burley tobacco. As you know, we have had a rather abrupt downward adjustment in livestock prices. But with the kind of a good sound tobacco program that we have been able to maintain then with the legislation we have had, we have had a fairly stable burley tobacco price situation.

That has resulted in the farmers' labor invested in burley tobacco giving him a return that was comparable to labor off the farm. It has resulted in the labor used in producing livestock giving him a return much less than it would give him in enterprises off the farm.

The farms I operated 4 years ago, the income was roughly 40 percent from burley tobacco and 60 percent from livestock. I am talking about the net income. This past year I finished my cost accounting and I found that the situation had reversed to this extent. The net income was down about 40 percent in total, but of that net income, 80 percent was from burley tobacco and 20 percent from livestock. The gross from livestock was still larger than burley, but the net-there is still some net in tobacco, and there is not so much net in the production of some other farm products-was down.

We in Virginia are all agreed that the burley program has been a good program, and we must save this program and make whatever modifications are necessary to keep it a good sound program.

There seems to be only one point of disagreement or one major point of disagreement here today; and that is on the minimum allotments. I don't intend to say what a minimum allotment should be or even whether there should be a minimum allotment, but I want to make this observation. In Virginia and in North Carolina, and in some of the other States, the average allotment is very close to the

minimum. In the last few weeks information has gotten around in these areas as all over the belt that the burley supply situation indicates a need of a cut in production of 50 to 60 percent. Our growers in Virginia visualize that if the minimum provision were done away with in its entirety, that they might end up with perhaps a three-tenths allotment. It would not only mean an adjustment of production; it would almost mean an adjustment out of the burley business.

I hope that there is some way that we will be able to work out our difficulties with less than a 50 or 60 percent adjustment. Perhaps we will, and perhaps we won't. However, I think that since that fear has gone through our growers, that doing away with a minimum might put them out of the burley business, that it would not be wise in the interest of the whole program to completely eliminate the minimum.

I cannot say exactly what I mean by completely eliminate a minimum. I think, though, that I can say this much in all honesty, and it will be the thoughts of the people in Virginia, that they would like to maintain the minimum we have or whatever part of that minimum can be lived with and still carry out a sound satisfactory burley tobacco control program.

That is all I have, Mr. Chairman.

The CHAIRMAN. I want to thank you for that fine statement. Mr. JENNINGS. Turner, on the referendum, do you feel that the referendum that has been proposed-speaking personally and not as president of the association-gives the farmers enough alternative? Mr. GILMER. If I understand your question, and if I understand the referendum that is proposed, it is that the Congress eliminate the minimum provision except that they not reduce an allotment under an acre more than one-tenth in 1 year. After the Congress has done that this spring we have a referendum, and the growers will vote on whether to keep the burley program as amended, or do without the burley program.

I think it would be too drastic to eliminate the minimum completely. That much I must take issue with that proposal.

The CHAIRMAN. If the gentlemen will yield there for one question, Mr. Gilmer, I know you know former Congressman Tom B. Fugate, who served up here very loyally and faithfully and rendered valuable service.

Mr. GILMER. Yes, sir.

The CHAIRMAN. He is from your section. I received a telegram from him which I would like to read. It is dated March 8, 1955, addressed to me:

Recommend acreage of tobacco of five-tenths or less have no reduction. Acreage of six to eight-tenths inclusive cut one-tenth annually when reduction is made. Acreage of nine-tenths and above cut percentage to bring production in line with disappearance. Red card tobacco should carry 75 percent penalty relationship. Adjustment reduced to one-tenth of 1 percent. Growers selling red card tobacco on white card penalized with cancellation of allotment for 1 year. It seems to me that is substantially what you were saying; to eliminate the minimum allotment entirely might be too drastic, but if it appears in as bad a situation as we are led to believe, then something should be done toward reducing the minimum but the reflection in a small portion by a one-tenth a year. Is that what you had in mind? Mr. GILMER. I might say this. It has been the customary policy of our organization to support the nine-tenths minimum when they

had it, and now to support the seven-tenths minimum, and I think I would be overstepping my bounds to recommend less than a seventenths minimum. However, I feel that our growers are willing to do what it takes to keep a burley program. I think if they have the information and we are going to have some meetings next week to try to get it to them, that they will be reasonable in their attitude on what has to be done to keep the program in sound shape.

The CHAIRMAN. Your opinion is that if the information is such. that it leads them to believe and you to believe that it takes some reduction in the minimum, then that is what we will have to do?

Mr. GILMER. Yes, sir.

The CHAIRMAN. I feel you and your growers want to maintain the burley tobacco program that we have.

Mr. GILMER. Yes, sir.

The CHAIRMAN. If the facts lead us to believe that unless something is done along that line, we will lose the whole program.

Mr. GILMER. Yes, sir. I want to point out that I am 100 percent behind what the growers in the Virginia Burley Association want. I don't want to get far ahead of them.

The CHAIRMAN. You want to be with them.

Mr. GILMER. I want to be right with them. So far they still think that we need a seven-tenths minimum. However, after the meetings next week, I feel sure that they will see a little bit further into the figures and will probably have a softer attitude on the seven-tenths minimum.

The CHAIRMAN. Do you know offhand what percentage we have in Virginia of five-tenths or less?

Mr. GILMER. No, sir; I don't know. I say five-tenths down would be a rather small percentage at the moment. The larger percentage of our allotments are now seven-tenths. However, with a couple of cuts of a tenth a year, they would all be five or a large percentage would. Mr. SHUFORD. Mr. Chairman, there are 13,695 acres in Virginia, and there are 18,941 allotments.

Mr. JENNINGS. I wanted to ask you something but I do not know whether you or anyone is in a position to answer it. This question is concerning me. Just how far will this 64 percent of the people now represented cut before they are willing to vote the whole program out the door?

Mr. GILMER. Sir, I do not know. However, I think if they felt like they were immediately going down to three-tenths, they would just about as soon vote against it as for it. They might vote against it.

Mr. JENNINGS. I think that is the thinking of some of my people that probably don't understand the situation. I want to emphasize that a great deal of education is going to have to be placed on this program in order to get it over. If not, these mountain people are going to vote it right out the window.

Mr. GILMER. I might point out one figure that I have not heard quoted here. That while about 60 percent of the growers are in the seven-tenths bracket, and under, they only represent about 30 percent of the acreage. Actually about 60 percent of the acreage is still with the growers above seven-tenths. That is roughly, of course.

The CHAIRMAN. Are there any other questions? If not, Mr. Gilmer, we deeply appreciate your coming here and giving us this information. I certainly hope we can work out something that will be of aid and

assistance to our burley tobacco program which has meant so much to our people.

Mr. GILMER. Thank you.

The CHAIRMAN. Mr. Bordwine, would you care to add anything to what has been said?

Mr. BORDWINE. I don't have anything to add, Mr. Chairman. It has been quite an honor being here to hear the other witnesses.

The CHAIRMAN. We deeply appreciate your being here.

I would like at this time to recognize Congressman John Watts, of Kentucky, who I know is deeply interested in this, and is as well advised as any man on the burley tobacco program. He is not only a member of the subcommittee, but the full Agriculture Committee. I always like to meet with him on matters affecting tobacco. Congressman Watts, will you present the people from Kentucky? You may proceed.

Mr. WATTS. Mr. Chairman, I appreciate the opportunity given me to not only welcome but to present the folks from Kentucky. I will call them in the order in which they want to testify, and any of those that do not testify, we will recognize at any rate.

We are fortunate this afternoon in having with us John Berry, of Newcastle, Ky. Of course, I am going to take issue with both of you Virginians about the best district.

The CHAIRMAN. I confined it to Virginia.

Mr. WATTS. The best district anywhere is the Sixth District of Kentucky.

Mr. Berry enjoys the distinction of not only being the chairman of the Eight State Committee that has been studying this problem, but he has been attorney for the Burley Tobacco Growers Cooperative Association for many years. He has lived with the tobacco problem ever since its inception, and at this time I think it would be a pleasure for the whole committee to hear from Mr. Berry.

The CHAIRMAN. Mr. Berry, we will be glad to hear from you now.

STATEMENT OF JOHN M. BERRY, CHAIRMAN, EIGHT STATES BURLEY TOBACCO COMMITTEE

Mr. BERRY. Mr. Chairman and gentlemen of the committee, as our fine and distinguished Member of the House from the Sixth District of Kentucky has stated, my name is John M. Berry, and I am from Newcastle, Ky. I served as chairman of the Eight State Burley Tobacco Committee, and for about 15 years now I have been vice presidert, and for a part of that time attorney for the Burley Tobacco Growers Cooperative Association of Lexington, Ky. I may be in somewhat of an uncomfortable position, and even an unenviable position in being obliged to speak for the two groups, the Eight State Burley Tobacco Committee, and the Burley Tobacco Growers Cooperative Association, because while they are in accord on some of the vital problems and subjects that are involved in the present critical burley tobacco situation, they are in disagreement in regard to some of the subjects that we have been considering.

I came here with an object of reporting on behalf of both, indicating the subjects upon which the two groups are in accord, and indicating the subjects upon which they are in discord.

If I may proceed in that manner, I think perhaps I can dispose of my part of the proceedings here in a rather brief period of time.

I want to say at the outset there is widespread concern over the burley-tobacco situation and it is a situation that does not improve with scrutiny, but rather it is one that grows more involved and grows more serious the longer one looks at it. It is not because of the program of production control, or rather it is not because the principle of production control is any less sound or any less practicable today than it was when it first was invoked for burley tobacco. It has not failed because of the fault of the principle, but it has failed, if it has failed, because those of us including anyone who has had anything to do with it has failed in its proper application.

We have had it too good a long, long time, and we as tobacco growers and Government administrators and tobacco leaders did not look at the program with the close scrutiny that we should have. Had we long ago, we would have discovered its imperfections, and would have noted and would have repaired its defects. But the ever-ascending line of consumption in this country of cigarettes and tobacco products has answered our problems and has concealed from our view the imperfections in the program and in the administration of it.

There are many contributing factors to the present situation. Many of them have been discussed here. I think in the final analysis there is one statement that reveals the true situation, and that is that on hand today we have a total supply of burley tobacco of 1,860 million pounds, whereas we should have for comfortable supply to take care of our needs for two- and six- or seven-tenths years in the light of the 5 percent decline in consumption, about 1,500 million tons. So that we have an apparent excess of 360 million pounds that have no place to go and the embarrassing thing is that we have no explanation for it, for had we by the sensible use of production control kept supply in line with disappearance, we would not have to explain the presence of 360 million pounds of burley tobacco that we haven't any use for.

I think both of these groups that I am speaking for recognize that the child is sick, the patient is ill, and that nothing short of drastic action will provide the remedy that we so sorely need.

It is a peculiar thing that human nature always speaks through the mouths of all of us. That weakness that we all have causes us oftentimes to speak not objectively but selfishly; not with a detached and overall view, but with a limited provincial view. I think it is generally recognized that every tobacco grower kicks when he is cut. I think it is generally true that every tobacco grower thinks that everybody else ought to provide the remedy for the present situation, but he himself, the one who speaks.

We shall never be able to progress, we shall never be able to provide the remedy that we so sorely need now unless we take a national viewpoint. This is a national problem.

These two groups are constituted of as fine men as I have ever been associated with. The Eight-State Burley Tobacco Committee was composed of 2 representatives from each of the 8 States in the burley belt. Representation on that committee was not upon the basis of pounds or acres or wealth, but it was upon the basis of State entity. The membership of the board of directors of the Burley Tobacco Growers Cooperative Association in my experience has no equal.