remedy or some plan to suggest to the committee. There will also meet in the afternoon the general farm organizations of the country which I mentioned this morning.

In view of the desire and effort among the great farm organizations to get together, I think the committee should stand adjourned until 10.30 in the morning, and we may have an opportunity to confer during the afternoon.

The committee will stand adjourned until 10.30 to-morrow morning.

(Whereupon, at 3.30 o'clock p. m., the committee adjourned until to-morrow, Tuesday, March 26, 1929, at 10.30 o'clock a. m.)

FARM RELIEF LEGISLATION

TUESDAY, MARCH 26, 1929

UNITED STATES SENATE,

COMMITTEE ON AGRICULTURE AND FORESTRY,

Washington, D. C.

The committee met, pursuant to adjournment of yesterday, at 10.30 a. m., in room 324, Senate Office Building, Senator Charles L. McNary presiding.

Present: Senators McNary (chairman), Capper, Norbeck, Frazier, Thomas of Idaho, Heflin, Thomas of Oklahoma, and Shipstead. Present also: Senator Brookhart of Iowa.

The CHAIRMAN. The committee will be in order, the hour for our hearings having arrived. Doctor Black, of Harvard University, is here and has quite a detailed statement to make to the committee. Doctor Van Natta, of New York, is also here. I understand that Doctor Van Natta has a very brief statement to make, and that he desires to leave as soon as possible. We will, therefore, first hear Doctor Van Natta. Doctor, will you please take this end seat and state for the record your full name, occupation, and address?

STATEMENT OF J. LYMAN VAN NATTA, NEW YORK CITY

The CHAIRMAN. In what business are you engaged, Mr. Van Natta?

Mr. VAN NATTA. I am not actively engaged in anything at the present time.

The CHAIRMAN. What has been your life work?

Mr. VAN NATTA. Agriculture and livestock.

The CHAIRMAN. Where has been your place of business?

Mr. VAN NATTA. Tippecanoe County, Ind.; Amarillo, Tex; and Oklahoma and Kansas.

The CHAIRMAN. Do you represent any organization?

Mr. VAN NATTA. No, sir.

The CHAIRMAN. You may go forward in your own way and discuss the subject that is now before the committee.

Mr. VAN NATTA. It is a thought that I have had in mind for four or five years, because my life has been spent in agriculture and livestock business, and rather extensively, especially in the livestock business. It has seemed to me that if it is the idea for the agricultural end of the country to have cooperation, it is an all-important fact that the country should be divided into districts, because I do not believe that legislation could be passed in a sweeping law including the entire United States of America, on account of the different districts being so diversified.

The State of Maine would have no way in the world to cooperate with Montana or Texas, with Oregon or Iowa, in any line, whether it be agriculture or livestock; and, gentlemen, in speaking now, I want to include in what I say the livestock business as well as the agriculture, because they are very closely allied, and I think that what pertains to one ought to pertain to the other.

I have a plan in my mind, as I said before, of dividing the country into districts, some 14 districts, and in those districts I would put the States that are in the same lines of production, as nearly as possible. For instance, taking New England as a district, and New York, Pennsylvania and New Jersey as a district; the Virginias and Maryland and South Carolina and North Carolina and Georgia and Florida probably as a district. I just marked this thing out yesterday after a little thought on it. Take Alabama, Mississippi, Arkansas, Louisiana, and the southeastern portion of Texas as a district. Divide Texas just west of Fort Worth. Take Tennessee, Indiana, Kentucky, Ohio, and Michigan as a district. Illinois, Missouri, and Iowa. Minnesota, Wisconsin, North and South Dakota. Nebraska, Kansas, and Oklahoma. The greater portion of the State of Texas with New Mexico and Arizona. Colorado, Wyoming, and Montana as a district. Idaho, Utah, and Nevada. Oregon and Washington as a district. California as a district by itself.

It is my thought in this division, gentlemen, that there would be 14 districts, and to have the different districts send up names to the President of the United States or the Secretary of Agriculture. Now, this is a thought of mine. I am not laying this out as a law or anything else. It is just an idea that I am bringing to you. My idea is to have each one of these districts presided over by some man who is nationally known within the district. Do not go to Maine to get somebody to act in California, or to California to get somebody to act in New York. Appoint somebody from within the district. Then, after these 14 are appointed, there would be appointed, in addition, either 3 or 5 nationally known men who would act in a method a good deal the same as the Interstate Commerce Commission acts over the railroads.

I have marked here district 11, which would be New Mexico, Texas, and Arizona. That is really the breeding ground and the livestock home of America. If a man in Pennsylvania wanted to buy a thousand or 500 or any number of certain age of cattle, the man in Texas could inform him in two minutes, because everything would be listed with him; he could inform him where he could get the cattle, what they would cost delivered to him in Pennsylvania or free aboard cars in Texas, without extra yardage, without extra commission fees, and without two or three freight handlings through stockyards.

I think the same plan could be worked with respect to wheat and I think it could be worked with respect to cotton, tobacco, fruit, or vegetables. It is my idea to have the Government help the producer to organize; and if my plan is not sound, it will not hurt my feelings, but I have spent a good many days and hours thinking over it and it has been my life experience. I know that times have changed and that the country has changed, and I know that in 40 or 50 years' time we have not changed a single bit in the way of disposing of our crops or our livestock in this country.

In all fairness it would seem to me, as from one man to another, that if a man owned 50,000 acres of land in the West somewhere and had a couple of thousand cows on that 50,000 acres of land, he should not be subject to shipping his product 500 or 600 miles to 1 of 10, 12, or 14 markets that are designated to him to go to. He can not go anywhere else to dispose of them, and he pays the freight, and he pays all the expenses; he pays the feed bills and the commission for selling, and he takes then what they call the market price. It would seem that the market price would be what 80 per cent of the cattle that are sold bring.

If the United States Steel Co. sold their products the same way they would close their mills, and so would Mr. Ford close his factory, and General Motors would, I think, or any other industry. They could not live that way. But under this plan I can not figure why it could not be managed and controlled just the same as any industry is managed and controlled by 14 district members appointed from the district with an executive power over them the same as the Interstate Commerce Commission has.

The CHAIRMAN. Thank you, Mr. Van Natta. Does any member of the committee desire to propound any question to Mr. Van Natta? If not, the committee is obliged to you, Mr. Van Natta. Doctor Black, we will hear you now.

STATEMENT OF PROF. JOHN D. BLACK, DEPARTMENT OF ECONOMICS, HARVARD UNIVERSITY, CAMBRIDGE, MASS.

The CHAIRMAN. Doctor Black, will you please state for the record your full name and address and the university at which you are teaching?

Mr. BLACK. My name is John D. Black. My occupation is professor of agricultural economy, Harvard University, Cambridge,

Mass.

The CHAIRMAN. Doctor, the committee desires that you make a statement, in a general way, concerning the subject matter now before us for consideration, namely, the proposition of farm relief at the special session of the Congress.

Mr. BLACK. I have been studying this problem of agricultural relief for several years and rather intensively for the last several months. Your committee has been studying it for an equally long period, and I thought that I could come down and appear before you and present some of my ideas on the subject, and when I got through I would have a clear understanding of the whole problem. I hope that I shall be able to clarify some of your ideas with respect to the problem. I do not expect that anything that I do or that your committee is able to do at this particular coming session of Congress will solve the problem of agricultural relief. It is a problem which is going to take many years, and what we do now will be a beginning.

The first problem which I wish to discuss with you is the problem of standardization of agricultural income. I have come to the conclusion that agricultural income can be stabilized, and I have worked out on a series of charts-which are over here on one side of the room-some of the elements in that problem. I am going to present

those to you as simply and as briefly as I can. Chart No. 1 shows in the last column the price for cotton that would have been necessary to have stabilized the income of the cotton growers of the United States. If the cotton growers in each of these years had received the price that is there indicated, that price, multiplied by the volume of the crop, would have given them an income which was the same for each of these years, except for the trends, the general long-time trends. You would not want to estabilize an income at a fixed point in a period when the country and the population are growing.

This will stabilize income except for a steady crop. You will notice for the year 1919 it would have taken 29 cents a pound to have given the cotton growers the same income from their cotton as 18 cents for the year 1924. This [indicating] was a short crop year, and the second year was a large crop year.

The CHAIRMAN. Pardon me. What you have indicated in the last column would have put agriculture on a parity

Mr. BLACK. No, Senator.

The CHAIRMAN. You are referring to the interchangeable value of farm products. What is the basis for your computation? So many bases have been used that I am curious to know what you have developed.

Mr. BLACK. I was just thinking of the easiest way to explain it to answer your question, Senator.

The CHAIRMAN. I do not want to interfere with your argument. You may go forward in your own way.

Mr. BLACK. These prices are the prices according to the price level which maintained at the time.

Senator BROOKHART. If that was not high enough to make the cotton farmer prosperous it would not help any to even up a failing or a losing price?

Mr. BLACK. But I am discussing at this particular time the stabilization of income, and not the problem of raising prices to the point of making cotton growing profitable. The program of stabilizing is a problem of making prices such in one year with another so that the cotton growers get the same income one year as another, not a very low income in some years, because there is such a large crop of cotton that sells at a price and a very low price. The program of stabilizing is directed toward a solution of that particular problem.

Senator THOMAS of Oklahoma. Do you hold that to be desirable? Mr. BLACK. I am going to comment on that point a little later. You can see that in order to have a stabilized income in 1920, which was a year of large cotton crop, the actual carry-over was 6,534.000 bales. It actually sold for 13.9 per pound. If that carry-over had been enlarged by 5.406,000 bales, the cotton growers in that year would have received 22.5 cents per pound for their cotton and would have received exactly the same total amount of money for the whole crop as would have been received in the year previous at 29 cents per pound for the shorter crop of cotton.

The year following was another rather large crop. The actual carry-over was only 2,832,000 bales. To have obtained in that year a price that would have stabilized the income at 25.5 cents per pound