While the current slaughter situation is in a typical cattle-cycle phasewhere increasing slaughter depresses prices and ultimately results in a reduction or leveling off of cattle numbers--it takes time to reduce an oversupply. Unfortunately, the natural cycle of approximately three years from breeding to fat steer sale must run its course before cattle supplies can stabilize.

These supply, and subsequently, price problems came to a head more quickly than expected in 1974. Higher feed grain costs, inflation, and rescessionary pressures-including the 1973 disruptible price freeze-caused the cattle slaughter to decrease at the very time total numbers were on the rise.

Per capita consumption of beef, however, in 1974 hit a new high of 117 pounds. A further increase this year to at least 122 pounds per person is predicted by the industry. This sounds like encouraging news. But is it?

Demand for beef is measured not only in pounds consumed, but also per capita expenditures. Thus, based on historical trends, consumers cannot be expected to spend more than about 2.6 percent of their disposable income on beef. Mr. Chairman, I ask that a table indicating this trend be printed at this . point in the hearing record.

PER CAPITA CONSUMPTION AND EXPENDITURES FOR BEEF

Inflation has also had an adverse effect on consumer buying power, as well as reducing the producer's share of the available meat dollar. With the economy in its present condition, it seems logical that consumers will continue to watch their spending at the meat counter.

One of the primary objectives of S. 772 is to establish a coordinated effort to educate consumers, develop markets, and hopefully, provide a steady supply of high quality beef and beef products to consumers at reasonable prices. Such an effort would be supported by the check-off provision of S. 772, which applies to cattle sold at market.

This kind of program is similar to one which is operated by Nebraska wheat growers. Their purpose is to use the proceeds from a per bushel "excise tax" on wheat to expand and develop foreign markets. The system has been successful for our wheat-growers, and has been duplicated throughout the country. Accordingly, S. 772 proposes a self-supporting system to provide a means for improving domestic and foreign consumer markets for beef.

EFFECTIVENESS OF S. 772

Mr. Chairman, the proposed legislation calls for an initial rate of .3 percent en the sale price of cattle sold to finance the activities of a national Beef Board. After the first year, the rate could be adjusted between .1 percent and .5 percent. Utilizing a base of $22.1 billion-the total annual sales of the industry last year-and the initial figure of .3 percent, more than $66 million could be raised by the check-off system.

The point is, that this money would be raised by the cattlemen themselves, not the government.

Here in the Congress we speak often of farm problems and programs to help the farmer. Just this week, the Congress faces final action on a price support bill for 1975 farm crops. But these kinds of programs are not for the cattleman. The beef cattle industry does not receive government subsidies; it has no program to control output. It is comprised of a fiercely independent group who have weathered difficult times in the past, and even more so in the last two years. The only thing they ask for in this bill is legislation to give them an opportunity to return their industry to good health.

Will this legislation be effective? Many in the livestock industry believe so. It will set national goals for beef research and consumer education and promote the coordination of 20 state systems now in operation. The establishment of a central board will increase efficiency, provide a forum for nationwide exposure, as well as a unified voice for the industry.

SOME CONCERNS OF THE CATTLE INDUSTRY

There is cattle industry concern, however, about the level of funds that must be raised in the first year, about participation by industry groups on the board which do not contribute to the fund and about administrative functions of the board. Admittedly, all of the answers are not in the present bill. But, I am confident, Mr. Chairman, that with careful study of the testimony of these hearings by the members of this subcommittee, a workable and effective measure can be agreed upon.

CONCEPT OF THE BILL IS GOOD

I endorse wholeheartedly the concept of this bill. Many Nebraskans in the cattle industry have contributed to the formulation of S. 772. Changes still may be needed. That is fine. But it must be remembered that the cattle industry in this country makes a vital contribution to the economic and social well-being of this Nation. The mission of the cattle industry in America is simply this: to have the capacity to produce an assured and ample supply of quality meat at reasonable prices. Like other investors, farmers and ranchers will neither venture nor long remain in a market activity with a built-in loss. Prompt action by this committee can give the industry the opportunity to carry out its mission.

STATEMENT OF HON. GALE MCGEE, A U.S. SENATOR FROM THE STATE OF WYOMING Mr. Chairman, I appreciate this time offered me today by the Subcommittee to express my supportive statements on the proposed "Beef Research and Con

sumer Information Act." I have joined in sponsoring this bill because I feel that it has a philosophy of great value-that of the self-help concept.

My state of Wyoming boasts agriculture as its second leading industry. Wyoming beef is something to boast about, but the cattle industry's problems today certainly do not bring pride to the economy.

We in the Senate, especially those colleagues from cattle-producing states, are doing everything we can to help the beleaguered cattle- and beef-producing business in this country. Obviously, not enough has been done. We now come to a point where, as the Congress works within its bounds to solve some of the problems facing the cattle producer, the cattleman himself requests enabling legislation to allow him to promote his products at his own expense. I see the proposed Act as providing a means toward the end of a cooperative agreement between the Government and the private sector with the goal in mind of not only improving the situation of the cattleman, but also that of the consumerthe customer at the meat counter.

It must be said that it's a disturbing situation when something as valuable as meat on the table-something as popular as a good, wholesome steak-has to be promoted to the extent of costing the producer more money.

Over a decade ago, I was involved in creation of the Food Marketing Commission and subsequently served on the panel charged with examining the marketing process of food and fiber products. We found the cattle industry suffering from a squeeze play in the retail process.

Most recently, I have joined my colleagues in protest to the President and Secretary of State regarding possible increased beef imports. I was a sponsor of the Beef Import Act of 1966.

All this leads me to my main point today, Mr. Chairman. Despite efforts at governmental levels, we are at the point where it's obvious we have not done enough and should permit, with as little interference as possible, the promotion, research and related programs proposed by the Act to be initiated by the cattle industry at the grass roots level and carried on at that same level.

Mail from Wyoming cattlemen, as well as from all over the country, overwhelmingly supports the concept provided by the Act. The consumer, most assuredly, would favor a program which could result in better understanding of all that's behind his meat on the table with assurance that the price he or she is paying has a sound basis. Hopefully, information gleaned from research will provide a savings.

We turn often to the statement that the best government is the government which governs least. I ask that S. 772 not be amended to add more government to a fine proposal for local and private initiative. I am impressed with voluntarism in the measure the freedom to choose. Mr. Chairman, the bill is an excellent one.

The cattleman is a rugged businessman whose endeavors have been scuttled by a sagging economy. The consumer has also been severely affected by the problems in this vital industry.

I trust this legislation would bring the two factions together and result in better understanding and an avenue of recovery for all concerned.

Truth about human nutrition, health, marketing and distribution and how all these relate to beef is the ultimate goal of the Beef Research and Consumer Information Act. The attainment of that truth and its widespread knowledge will make our problems much smaller.

Mr. Chairman, I request favorable and quick action by the Subcommittee on S. 772 so that we may realize expedient passage of this legislation.

STATEMENT OF HON. CLIFFORD P. HANSEN, A U.S. SENATOR FROM THE STATE OF

WYOMING

Mr. Chairman, I am pleased to testify in favor of S. 772, which I have cosponsored, to establish a program through which American cattle producers voluntarily and collectively may support the organized promotion of their product.

Most of the time, we in Congress are engaged in deliberations on bills that would spend taxpayers' money for various purposes. This time, happily, we are considering a measure that would not cost the U.S. Treasury, but would enable cattle producers to spend their own money on a program to enhance public

knowledge about their product and their way of life, and better inform members of the industry on market and supply trends.

The Beef Research and Consumer Information Act has been called "self-help" legislation, and this is an appropriate term both for this bill, and for application to the history of the livestock industry. The industry traditionally has not been involved in government farm programs and its members have not been the recipients of federal subsidies, as were commonplace under past programs for other segments of agriculture.

Even now, during one of the worst periods ever for this industry, most cattle. men strongly oppose government involvement and/or aid, believing the industry can best recover from the current slump independent of direct government aid and the intervention and red tape that always accompanies such aid.

S. 772 would authorize the Secretary of Agriculture to set up a program of research, producer and consumer education, and promotion, to improve, maintain and develop markets for cattle, beef and beef products, and to provide an adequate and steady supply of high-quality beef to consumers at reasonable prices.

The bill would require the Secretary to conduct extensive hearings to seek input from the industry as to how the program should proceed, and require him then to conduct a referendum to seek approval for the program.

Approval by two-thirds of those participating in the referendum would be required, and additional referendums could be held at any time 10 per cent or more of those voting so requested.

The program would be financed by money from members of the industry, at a rate the first year of .3 per cent of the price of cattle sold, and after the first year, at a rate between 1 and .5 per cent, as determined by the Beef Board. Any producer would be entitled to request a refund of assessments from the sale of his cattle within 30 days after the sale, and the refund would have to be made within 60 days.

Mr. Chairman, from what I can determine through contact with the livestock producers of my state, this bill has the support of most cattle producers. I am pleased by the strong support evidenced in the Senate, and hope S. 772 can be promptly cleared for Senate consideration and approval. I believe it will help the industry recover from the present cost-price squeeze, and aid in the reduction of the current over-supply of beef.

STATEMENT OF HON. FRANK CHURCH, A U.S. SENATOR FROM THE STATE OF IDAHO

Mr. Chairman, I appreciate this opportunity to testify before the Senate Agriculture and Forestry Committee on S. 772, the Beef Research and Consumer Protection Act. It is with great pleasure that I have joined with many of the distinguished members of this Committee in sponsoring this important legislation.

In my estimation, this proposal is of great urgency. Since 1973, cattlemen in Idaho, and throughout the country, have been racked by an economic depression of tremendous magnitude. The former Nixon Administration is largely responsible for the present crisis. While wage and price controls were being lifted on all other goods, then President Nixon, and his advisors, somehow felt justified in retaining a freeze on beef prices. No one yet knows the full impact this illadvised action had on ranchers in Idaho. But one thing is certain, few businessmen could sustain a freeze on the price of their product while all their production costs were allowed to sky-rocket. Like many others in Congress, I urged the Administration to reconsider these policies, but to no avail. Now, ranchers everywhere are being stretched to the limit.

With depression at the doorstep, I was appalled to learn that the State Department may allow an additional 100,000 pounds of foreign beef imports into this country, over and above the amount negotiated for importation last year. The President controls the level of imports, under authority of the 1964 Beef Import Act. When will the Administration stop making U.S. cattlemen the pawns of international trade negotiations?

Even under these adverse conditions, cattlemen have sought very little government assistance and they are to be highly commended for their persistence in maintaining their independence. The Beef Research and Consumer Protection Act, which has the backing of all major segments of the cattle industry in

Idaho, is an excellent example of a troubled segment of our economy attempting to pull itself up by the bootstraps.

The Act authorizes the Secretary of Agriculture to issue a national order to create a National Beef Board with an appointed membership form all geographic areas of the country. The Board will be authorized to conduct referendums among cattlemen to determine whether or not they support a levy on their product which could then be used for beef research and consumer education. I wholeheartedly support this legislation in any way possible to assure early and favorable action by the Senate.

STATEMENT OF HON. JOHN TOWER, A U.S. SENATOR FROM THE STATE OF TEXAS

"The Beef Research and Consumer Information Act" is valuable legislation to both the cattle industry and the consuming public. Several months ago, I cosponsored this bill, and now strongly urge the committee to vote its approval of this important program.

From the beef producers' standpoint, this "self-help" bill will further organize and manage the economic interests of their industry. To effectively meet the needs of an increasingly complex beef economy, a forceful and intelligent promotional, marketing and educational program is required on a national scale. Of highest priority is to make each cattleman in this country aware of new and proven ways in which he can better develop his production and marketing operations. With this greater sophistication, the beef producer will be better able to assure us all of a dependable supply of beef at prices which we as informed consumers will realistically expect to pay.

When I say "informed consumer", I refer to an objective which will be strived for through this national beef research and development program. Just as beef producers will reap educational benefits from this program, so too will shoppers. All of us should have some understanding of the significance to domestic beef production and prices of such factors as rising foreign beef imports and high feed costs.

In general, the consumer needs to know why beef prices rise and fall, who is profiting or suffering losses from erratic prices, and by how much. Above all, the shopper at the beef counter must realize that cattlemen are working in the best interests of the country, and are entitled to make a decent living while doing so.

It is my hope that a spirit of co-operation and mutual understanding between beef producers and consumers will be fostered by this legislation. Significantly, this national "self-help" program was conceived to help prevent another catastrophe such as the one which has currently afflicted the cattle industry. A goal of sufficient beef supplies at stabilized prices can be worked toward more effectively with the successful implementation of this far-reaching educational and beef marketing development program.

STATEMENT OF HON. BOB PACKWOOD, A U.S. SENATOR FROM THE STATE OF OREGON

Mr. Chairman, both the American cattleman and consumer are suffering at the hands of a food marketing system for which no one seems accountable. On the one hand, many ranchers are either on the verge of bankruptcy or are already there. At the same time, we don't need a Presidential commission to convince the shopper that beef prices have risen dramatically.

Twenty five years ago people were complaining about the high price of beef. Indeed, prices had increased sharply and beef was retailing for about 75¢ per pound in the store. The rancher was getting 30¢ per pound on the hoof at the farm. So I called the U.S. Department of Agriculture yesterday and they informed me that, while the price of beef in the store is upwards of $1.25 per pound, the rancher is getting, you guessed it, 30¢ per pound.

I have attempted, without success, to determine where all this "middleman" money goes. Packers, processors, shippers and retailers are all involved but no one has been able to tell me who is charging what for his services, much less justify the amount charged. Indeed, the Joint Economic Committee has recently concluded hearings which reveal a startling lack of accountability on the part of those involved in the marketing of beef.