industry concerned represents about one-sixth of our national agricultural income in normal times. It is our well-considered judgment that sound national policy and the greatest common good require that the present Federal taxes on oleomargarine be maintained. That is all I have to present, unless you have some questions. Senator AIKEN. I do not have any. Do you desire to enter anything further, Dr. Sommer? Dr. SOMMER. There was one point I might clear up. As the record stands now, there was testimony introduced which would have us believe that in comparing adjoining States, one in which the State has no restrictions on oleomargarine and a neighboring State which has restrictions on oleomargarine, that such restrictive taxes have had the effect of causing a lower return for milk in the State concerned. Those figures introduced-and they were based on combined sales of butter, cream, and milk in the State, and compared New York and Vermont. It was thus shown that the return in terms of price per pound of butterfat was considerably higher in New York than in Vermont. The difference was 9 cents per pound in favor of New York. A more fair comparison would have been to compare the returns for cream sold to plants, dealers, and so forth, which would then exclude the high-class, high-priced milk that goes to the city market. When that comparison is made it shows just the reverse in all but one of those five pairs of States, where the difference was only 1 cent. Instead of placing a construction on the figures, the figures that have been introduced earlier, and the figures to which I now refer— instead of placing the construction on them that was done, obviously, the correct construction is that in each case the State that had restricted taxes on oleomargarine had those taxes because in their State a large portion of the milk sales had to go to manufactured dairy products which are obviously most directly affected by competition from oleomargarine. And the existence of a tax reflects that condition rather than proves anything else. Senator AIKEN. Thank you. Is Professor Staples here? If So, will you come forward? STATEMENT OF C. H. STAPLES, PROFESSOR AND HEAD, DEPARTMENT OF DAIRYING, COLLEGE OF AGRICULTURE, LOUISIANA STATE UNIVERSITY Senator AIKEN. Will you identify yourself for the record, please, and present your testimony? Mr. STAPLES. C. H. Staples, professor and head, department of dairying, college of agriculture, Louisiana State University. I am here at the request of the three of our State dairy organizations, the Louisiana Dairy Association, the Louisiana Jersey Cattle Club, and the Louisiana Dairy Farmers Protective League. I am here also with the approval of the dean of the college of agriculture and the dean of Louisiana State University. Louisiana is blessed with several advantages favoring dairying. Among them is a long growing season. This makes it possible to have cattle procure their own feed from pasture during most of the year. The warm climate also makes it unnecessary to construct expensive housing facilities. The prevalence of small farms in Louisiana makes it necessary that an intensive type of agriculture be followed. Dairying meets this requirement by giving relatively large returns in proportion to the size of business involved. For many years the college of agriculture and the agricultural extension service of Louisiana State University have sought to promote dairying in Louisiana. This has been with the objective of bringing about a more diversified agriculture in the State which would enable farmers to inaugurate a better crop rotation system and replace much of the soil-depleting cottor crop with dairy cows which promote greater fertility of the land and an increased agricultural income as well as supplying a means for improving the nutritional standards of the people of the State. As a result of this effort, the dairy industry of Louisiana has made a steady growth during the last 20 years and particularly since 1933. In 1933 the value of milk production in the State was $12,624,000. In 1943 it had increased to $27,028,000. This trend is by no means at an end, for the value of the dairy cow from a soil-fertility standpoint is being recognized more generally as time goes on. The value of marketing farm crops through the dairy cow, returning the fertilizer to the soil, is being given more consideration than ever before. As a concrete example, I might cite that when the fertilizer from the dairy cow was added to land for the production of silage crops on the Louisiana State University dairy farms, 12 tors of corn and silage were produced in comparison with 2 tons per acre from unfertilized soil. Land, cultivation, and so forth, were all the same with this exception. One has only to travel through the South to see that cotton has depleted southern farm lands, even worse than wheat has done in many of the wheat growing sections. Where some of this cropland has been devoted to pasture and fertilizer from the dairy herd used, it has yielded from $50 to $150 per acre. This is equivalent to the cost of 3% to 4 tons of hay. On January 1, 1944 there were 345,000 milk cows in the State of Louisiana. This compares with 220,000 head in 1920 and 280,000 in 1933. The cattle tick has been eradicated from the State at a cost of millions of dollars to both the Federal and State Governments. Seven hundred purebred registered dairy bulls have been placed in the State by the University dairy herd alone. The State of Louisiana for several years led the Nation in the vaccination of calves for Bang's disease. In many of the parishes (counties), the dairy industry has a valuation of more than $1,000,000, when cattle, dairy buildings, and equipment are included. In 1943 the New Orleans milkshed was one of the very few in the country that showed en increase in production over 1941 with 105,000,000 pounds in 1941 as compared with 125,000,000 pounds in 1943. Production thus far in 1944 has exceeded that of 1943 by about 30 percent. In 1943, 1,442 purebred high-quality dairy calves were placed in the hands of 4-H Club members. In some parishes as many as 50 new dairy barns have been built in the last 2 years and thousands of permanent and improved pastures have been made. From this it is apparent that Louisiana farmers and citizens have a definite and continually increasing stake in the dairy industry. In comparison, just what is the Louisiana farmer's economic interest in the production of oleomargarine? For some years cottonseed oil has been a principal ingredient of oleomargarine. However, cottonseed oil promises to be largely replaced by soybean oil in oleomargarine manufacture. For the first time in history, during the first quarter of this year, the volume of soybean oil used in the manufacture of oleomargarine exceeded the volume of cottonseed oil and I am told that yellow oleomargarine is now being made almost entirely from soybean oil. Even in 1942 when cottonseed oil constituted 48 percent by weight of all of the oils used in oleomargarine, the value derived from it by cotton farmers was insignificant as compared to either returns from dairying, the cotton crop as a whole, or cottonseed meal fed to dairy COWS. In that year the gross returns from all dairy products was $21,415,000. The returns from cash sales of dairy products was $11,183,000; cash income from cotton lint and cottonseed was $60,927,000; cottonseed alone was $8,722,000. The value of Louisiana cottonseed meal fed to milk cows was $2,253,725 and the value of Louisiana cottonseed oil used in oleomargarine was $735,100. The farm value of Louisiana butter alone was more than $2,000,000 or about three times as much as the value of cottonseed oil going into oleomargarine. Normally the value of cottonseed oil used in vegetable shortening has been about four and one-half times as great as that used in oleomargarine. Indeed, the increase in the volume of cottonseed oil used in oleomargarine over a period of years has only resulted in a diversion from its use in vegetable shortening without making any additional market or increasing the price of cottonseed oil whatever. We believe that passage of the Smith bill, S. 1744, would simply result in defrauding the public and increasing the sale of oleomargarine to a point where it would seriously curtail dairy production with a resultant immediate and continuing loss to the agriculture and general welfare of Louisiana. When I left home, at that time, there had been a bill in the legislature to force the serving of milk free in all of the public schools of Louisiana. I feel like the cottonseed-oil people who make the hulls and the meal, and when our dairy cows' feed is cottonseed hulls and meal, I feel that we are a much better customer of them than the oil people who buy these small amounts of oil. I would like to read a letter now from one of the most progressive and scientific cottonseed farmers in the State of Mississippi, who is president of the Mississippi Jersey Cattle Club. He wanted to come up here with me to discuss this matter. He grows about 3,000 bales of cotton a year. He has a Jersey herd which I have classified twice. He says: I have written our executive committee regarding sending a representative to Washington on June 6 and as soon as I hear from them I will let you know. Being from the second largest cotton-producing State and also from one of the most progressive Southern dairying States-I am between the devil and the deep blue sea. 1 firmly believe after the duration we will see a decided decrease in the production of cotton unless we are able to produce it at a much lower cost by the use of machinery. This will almost eliminate the small farmer and he will have to look to other fields and I firmly believe most of them will go to dairying. This is signed by G. A. Wilson, Ruleville, Miss. I also have a letter here from the Louisiana Dairy Association, Patterson, La., which reads: We noticed through the press of the State that there is a bill in Congress at this time calling for the elimination of all taxes on "margarine" which this organization considers detrimental to the dairy industry. We wish to request that you attend the hearing to be held in Washington, D. C., on this bill on June 6 and represent the dairy industry of Louisiana. This letter is signed by W. B. Smith, president of the Louisiana Dairy Association. I also desire to read another letter from Mr. Smith as follows: I note through the press of the State that a bill is coming up for hearings before a committee in Congress starting on June 6, which has for its object the elimination of all taxes on "margarine.' There is no doubt that all the dairy interests of the State are opposed to this bill and we should let ourselves be heard before this committee by someone who can represent all the dairymen of Louisiana. Finding it impossible for any of the three presidents of the three organizations to attend, I am sure we all agree, that no one is better qualified for this job than Henry Staples, and I hope you can see your way clear to let him attend these hearings. I have read several magazine articles on the subject of butter versus oleomargarine. There is no doubt that a large sum of money is being spent to aducate the public as to the food value, etc., of these synthetic products, and whenever the tax is taken off, we will be losing just that much. Dairymen are not afraid of the fair competition of these synthetic preparations, but of the unfair practices that have been used in the past lead us to believe they will be resorted to more forcefully in the future. I also desire to read a letter from the Louisiana Creamery, Inc., which was written by Mr. J. M. Cadwallader, president, as follows: On June 8, there is to be a hearing in Washington on a bill for Congress regulating the sale and production of oleomargarine. As you doubtless know, for years there has been a continuous struggle between the dairy products interests and the oleomargarine interests as to how far the Congress should go in controlling or taxing the sale of oleomargarine. In years gone by in many institutions, especially boarding houses and eating houses, oleomargarine has been served to the public in the place of butter because it can be colored up to look like butter and in the process of manufacturing cultures are used to flavor it. For this reason, the dairy industry has always insisted that certain protection against this sort of thing be given. As you know, in recent years some of the newer ideas of vitamins and nutrition have had a tendency to break down some of the older ideas regarding nutrition. Most of these experiments, however, are performed with rats instead of human beings and do not take into consideration the welfare of the public at large, especially the necessity of the kind of agriculture that will be self-sustaining. In a national way, the State of Louisiana, along with several other Southern States, has been asked to send representatives to Washington to point out the necessity of protecting the dairy industry. Since livestock and dairying is probably more essential to the welfare of the South and to many of our Middle Western States, I believe Louisiana should be properly represented. We believe that Prof. C. H. Staples, who is probably the father of dairying in Louisiana, would be the most logical person to represent Louisiana dairy interests and the Louisiana Jersey Cattle Club would take care of any miscellaneous finances in connection with the trip. Those of us who are interested would ask that Professor Staples be authorized by the university to make this trip representing the dairy industry of the State. Yours very truly, LOUISIANA CREAMERY, INC. I also have a letter here from Charles N. Shepardson, head of the department of dairy husbandry, Agricultural and Mechanical College of Texas, College Station, Tex., reading: I have tried to get some information on the relative value of dairying and margarine in Texas. Based on available Government figures, it appears that the value of the Texas cottonseed oil used in margarine is about equal to the value of Texas cottonseed meal fed to dairy cows with the value of the hulls in addition. The farm value of Texas butter is approximately three times the value of Texas cottonseed oil used in margarine. Total farm value of Texas milk in 1942 was over $116,000,000. Texas dairying has experienced a steady and healthy growth for the past 15 years, while cotton production has dropped from a 1930–39 average of 3,766,000 bales to 3,038,000 bales in 1942, and is apparently continuing to drop at the present time. I also desire to call attention to the following facts as are set forth in the reports of the extension service of the Louisiana State University in connection with returns from agriculture, which states. Now that all the figures are available showing the returns from the various crops and livestock produced in Louisiana during 1943, the relative value of the various products can be shown. The following table lists in order the different crops, livestock and livestock products for which Federal figures show the gross returns in Louisiana last year. These gross figures include the actual cash received for the sale of products off the farm, plus the value of the differential products consumed on the farm by the farm families. Senator AIKEN. Will you be here this afternoon, Professor Staples? You have given us some very interesting and informative testimony. Perhaps we should have postponed your testimony until Senator Ellender returned; however, I know we are all anxious to get through with these hearings as soon as we can. However, it is quite possible that Senator Ellender will wish to interrogate you on this testimony. Mr. STAPLES. I will be glad to return. It was very nice of Senator Ellender to ask me up here, and I appreciate his very kind consideration which he has extended to me. He went quite out of his way to be of assistance and cooperate. Senator AIKEN. I understand it is planned to continue the hearings at 2 o'clock, when Mrs. Margaret Taylor is the next witness and will be called at that time. So, with that understanding, the committee will stand adjourned until 2 o'clock. (Whereupon, at 12 m. (noon), a recess was taken until 2 p. m. this date.) AFTER RECESS The hearing was resumed at 2 p. m., pursuant to recess. |