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Mr. OWENS. I think the tenant is generally accepted as a small farmer, if he is producing cotton at all. I really think that the interpretation placed on the man who produced a small crop of cotton, 2 bales, or less, accounted for the large majority in the election of last fall. And I think that is practically what the President's statement meant.
Mr. KLEBERG. As I understand the situation, Mr. Cobb, if the 2bale exemption were granted to that group inevitably you would have four or four and a half million bales of excess cotton?
Mr. Cовв. If you increase the exemption to take in those farms, I cannot tell you exactly off hand what it would be.
Mr. KLEBERG. How many farms are there in cotton?
Mr. Cовв. Two and a half million producers who claimed exemption, or made applications under the Bankhead Act.
Mr. KLEBERG. Applying that two-bale to the two and a half means you would have 5,000,000 bales?
Mr. COBB. You would have automatically 5,000,000 bales to begin with; yes.
The CHAIRMAN. I did not understand Mr. Doxey's position was that at all. I understand his position was that the base production of all farmers who produced or had a base production of two bales, or less, including tenants and share-croppers that would be exempt, would not give anything like that number of farms because most of the farms have a base production of more than two bales.
Mr. COвв. If you put it on a personal basis, Mr. Chairman, it would require a large amount of cotton, I would say from one and a half million bales up, and that is a rough guess, but beyond anything that we could take care of and stay within the purpose of the
The CHAIRMAN. My immediate section is not interested on that side but interested on the other side, rather, but practically all of the belt is. I confess that I cannot see why the individual farmer, who is farming land to which he has title, should be entitled to an exemption of two bales of producetion and the tenant farmer or the share-cropper not entitled to the same thing. I cannot see why the tenant farmer or the share-cropper would not be entitled to the same privileges, just on a man-to-man basis and in fairness and justice, and that the other fellow is; and if the program cannot be worked out so that it would be uniformly fair to all classes of producers I think it would run into great difficulty. I think it would run into injustices that would be so inequitable as to ruin the program; I think it would wreck the program if you are going to make that discrimination between men.
Here, for instance, are two men, one owning a 40-acre farm or a 10-acre farm, whatever it might be, and he gets an exemption of two bales. Just across the road is a tenant farmer or a share-cropper with a family of the same size, both families living in the same neighborhood and perhaps attending the same church, and yet the share-cropper does not get any exemption. I do not believe you can justify that.
Mr. BOILEAU. May I ask a question?
Mr. BOILEAU. In the President's statement, he did not make that distinction in reference to exemption, did he? I do not recall just the exact language of his statement. You do not think he intended to make an exemption of the tenant and the share-cropper, as I understand you?
Mr. CоBB. No.
Mr. BOILEAU. His statement, as I recall it, was in regard to the farmer who habitually produces less than two bales?
Mr. COBB. Yes.
Mr. BOILEAU. Do you not think that applies to the share-cropper who habitually produces less than two bales?
Mr. COBB. They have never been so interpreted.
Mr. BOILEAU. They are not?
Mr. Cовв. They are called "tenant" and "share-cropper."
Mr. BOILEAU. Well, under this act, the share-cropper you think is a different class of farmer; under this act?
Mr. COBB. I do not know that there is a different classification under the act; I do not believe that there is any definition of a farmer given.
Mr. BOILEAU. The President's statement was in regard to the farmer who habitualy produces less than two bales. Do you think that he had in mind a distinction between the man who owns a piece of land and continuously has produced less than two bales and the man just across the road who perhaps has rented land for 10 years and on that piece of land has produced two bales of cotton or less during that time?
Mr. COBB. That has been the intention from the beginning, according to my interpretation of it.
Mr. BOILEAU. You make a distinction between the man who rents, or is a share-cropper, and the man who owns the land?
Mr. Cовв. The small farmer; the small farmer has never been regarded as being in the same category with the tenant or the cropper; they are in a different category under this act; and that seems to me to be the way the act has to be applied.
Mr. BOILEAU. Do you think that the President, at the time he made that statement, had that fine technical distinction in mind?
Mr. COBB. I feel in this case, unless that interpretation is to be given to it, there is no way of carrying out the program; there is no administrative answer to it.
Mr. BOILEAU. Has the President said anything further along that line since you gentlemen in the Department have made this interpretation of the distinction between the two classes of farmers? Has he said anything to clarify that, to draw that distinction between the two classes?
Mr. Cовв. The President?
Mr. BOILEAU. Yes.
Mr. COBB. So far as I know, that matter has not been discussed with the President directly, but I think the feeling in the Department would be that the regulation must be such as would make an administration of the act possible.
Mr. BOILEAU. Administratively?
Mr. COBB. Yes.
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Mr. BOILEAU. Do you not think, after the Congress had passed the legislation, you do not think it necessary for him to confine his interpretation, or anybody to confine it to the power that is conferred in the act administratively?
Mr. COBB. Well, I do not know what he had in mind, of course. Mr. BOILEAU. As I say, I do not recall exactly what his language was, but my recollection of the statement was to the effect that it was the intention to wait until Congress convened so that Congress could make the change. In that case it seems to me it would have been his thought to restrict the change to what would be, or rather could be, administratively ordered, and if it could have been done by administrative order this necessity to wait for Congress would not have arisen. Mr. COBB. I think we can get the President's approval, administratively, to help carry this out.
Mr. BOILEAU. I have no doubt of that.
Mr. HOPE. May I ask you a question?
Mr. COBB. Yes.
Mr. HOPE. Your present statement, Mr. Cobb, if I understand you, is that if a farm produced two bales or less it would be exempt; is that correct?
Mr. COBв. My statement is that the definition of a small farmer would apply to the small farm that is owned by the farmer outright, and who in this case produces, habitually produces, two bales of cotton or less. The small farm has a clear definition in the South, and it has always meant that particular type and has not applied to the tenant or share-cropper.
Mr. HOPE. Well, I take it from some of the questions that have been asked that that is not uniformly true in the South; that in some places they consider a man, whether he is a tenant or a plain owner, as a farmer, and that if such is true in other parts of the country, the man who lives on the farm and farms it is called a farmer.
Mr. COBB. That is true; the tenants are farmers in the South. But small farmer, under the definition of small farmer, does not apply to the tenant; the small farmer, according to the accepted definition that applies to the farmer, is entirely different from that applying to the tenant on the plantation or the share-cropper, as I brought out awhile ago in this particular reference.
Mr. HOPE. The President dealt with the small farmer, did he not, upon the terms, as I recall it, of the farmer who produced less than two bales of cotton? I do not know what his definition for a small farm might be, whether it would be a little different down there than in other sections. He usually is the farmer, you say, in the South who has a small farm that he owns individually. Now, would that carry with it the meaning that the man who produces on his land less than two bales of cotton is a small farmer?
Mr. COBB. You have the farmer who is considered a small farmer and you have the tenant and the share-cropper. These represent three distinct classifications in the South.
Mr. HOPE. And your idea is then that the President definitely excluded the tenant and share-cropper and he made the statement to apply only to the landowner?
Mr. COBB. We had definitely in mind that this would apply to the small farmer.
Mr. HOPE. Meaning the man
Mr. CоBB. Meaning the man that produces cotton on his own land, two bales, or less.
Mr. HOPE. Very well.
Mr. MARSHALL. Do you think there is any justification whatever in the present act for that distinction, or if there is a justification in the act, from the standpoint of fairness do you not think that is a discrimination as between the landowner, who is a farmer, and the tenant and share-cropper? Just how would you justify that?
Mr. COBB. We do not believe that there is any discrimination, due to the fact that a plantation that has been growing cotton for some time has a good base history and that would give them a better allotment to begin with. I think the discrimination is the other way, the way it worked; for that reason I feel satisfied with this particular suggestion. The average plantation that has tenants on it has a good base already that goes automatically to the tenants.
Mr. MARSHALL. I see.
Mr. COBB. They are in a favorable position.
Mr. MARSHALL. In the example which Mr. Boileau gave, where you have 2 farmers, 2 producers, 1 who produces 2 bales, the sharecropper, and right across the road another who produces 2 bales, but owns his land; they have been producing cotton, say, for 10 years. It seems to me that under that system there is a discrimination between the two men which would wreck the system. It does not seem to me you can lay down definite regulations making that distinction.
Mr. COBB. It is assumed that the discrimination has gone the other way; it has gone against the small producer who has not had a satisfactory base in comparison with the average cotton plantation which has had a satisfactory base which results in a benefit to the tenant, of course.
Mr. MARSHALL. This base history that you speak of: Suppose there had been a production for the last several years of say 10 bales a year on the farm where there was a share-cropper, you mean, and the man who owns his farm may not have had the same base history so that he is not entitled to the same allotment as the plantation farmer?
Mr. COBB. The man may never have had a base history, the tenant farmer. But the individual allotments in the plantation are made to the tenants, or the share-croppers, and we have found that it worked out quite satisfactorily in connection with tenants, but when we come to the small farm, where they get down to a small production, we have found out that it has not been very satisfactory.
The CHAIRMAN. Mr. Kleberg has a question.
Mr. KLEBERG. A tenant farmer would be simply one who farms leased property, would he not?
Mr. COBB. That is right.
Mr. KLEBERG. Now, on a cash-lease basis, on a piece of land which, we may say, a tenant may lease in the raw; may lease the land and clear the land and put it in cotton, and he may operate a dairy in connection with that and have a base of 2 bales of cotton or less. Nevertheless, he has leased the land and paid his cash for that raw land. What would be his standing?
Mr. COBB. He is on the property and he pays rent?
Mr. KLEBERG. Yes; what is his standing, if he leases the land? Mr. COBB. Well, if he has the entire farm, as I understand your question, he would come within the scope of this exemption.
Mr. KLEBERG. One more question: Among those farmers that produce 2 bales of cotton or less, what would be a comparative cash return to the farmers on those 2 bales of cotton, in round numbers, what would be the return to the farmers in those two classes, the one who has his home land, the 2-bale farmer, and receives the 2 bales as his allotment, and the other?
Mr. COBB. That involves some calculation.
Mr. KLEBERG. As compared to the other, the tenant farmer who has 2 bales?
Mr. COBB. You mean for the man, over the entire program?
Mr. KLEBERG. For the entire program.
Mr. COBB. If you will go back, Mr. Kleberg, to 1932, a bale of cotton, plus the seed, was bringing $37.50.
Mr. KLEBERG. Yes.
Mr. CоBB. In 1933 a bale of cotton, plus the seed, brought $56.50, and in 1934 a bale of cotton, plus the seed, was worth approximately $80.
Mr. KLEBERG. $80?
Mr. COBB. Yes; an increase from $37.50 in 1932 to $80 in 1934. Mr. KLEBERG. All right. That is substantially an increase from $37.50 to $80?
Mr. COBB. Yes.
Mr. KLEBERG. Now, what would be the reduction, from a 2-bale basis, under the plan under which the farmer who had a base rate of, say, 2 bales, for instance; what would he be permitted to raise under the Bankhead Act today?
Mr. COBB. Without this thing we are discussing?
Mr. KLEBERG. I am just figuring his production. Suppose he had had a production of 2 bales for 10 years, we will say?
Mr. CоBв. Yes.
Mr. KLEBERG. What would be his reduction?
Mr. Cовв. I will have to figure that.
Mr. KLEBERG. Would he have just the same amount of income, or more, as this bill is now?
Mr. COBB. He would have, as I understand you, 956 pounds, less 35 percent.
Mr. KLEBERG. Now, what would that amount to?
Mr. KLEBERG. That would be a bale and a quarter?
Mr. KLEBERG. Than he would without it?
Mr. Cовв. Yes.
Mr. KLEBERG. I can see the difficulty you have in such a program, with reference to production. With that total production it would have the effect of reflecting a downward price by increasing the exemption you refer to?