With a board of seven members, each receiving $12,000 a year. you have used up $84,000 right there on board salaries. Then there are clerks to be paid, and all other things that you have to have, and I do not believe that the board could operate efficiently with that appropriation. The board has its hard work to do in the set-up. That is when the big work will come on the board.

The CHAIRMAN. How much do you suggest?

Mr. DUIS. I think $1,000,000 should be given for that purpose. I do not believe that you should handicap this board, because they have one of the most constructive undertakings that probably has ever been attempted in this country. I feel safe in saying that such an amount of money should be appropriated for the purpose as would be spent by a competent board in any business. And certainly I hope that when President Hoover comes to appointing the members of the board he will give us the best possible membership on it. First, I am going to assume that you are going to enact an agricultural bill, and then I hope when the President comes to the matter of appointment of the members of that board, that he will select men of wide experience and broad vision and a determination to do something for agriculture.

And I want to say to you, Mr. Chairman and the other members of the committee, that this matter is going to be altogether one of administration. If the administration is liberal in the consideration of this business, why, I can see where you are going to do a world of good to agriculture. And I believe that this bill can be made applicable to all the basic farming commodities. And if the board is liberal in its administration, I believe it will do a lot of good.

The CHAIRMAN. I thank you very much, Mr. Duis.

Mr. DUIS. I wish to thank you, Mr. Chairman and gentlemen of the committee, for giving me an opportunity to be heard, and I hope you may succeed in securing some kind of legislation that will be helpful to agriculture.

STATEMENT OF VIRGIL JORDAN, CHIEF ECONOMIST, NATIONAL INDUSTRIAL CONFERENCE BOARD, NEW YORK, N. Y.

The CHAIRMAN. What are the activities of the National Industrial Conference Board, Mr. Jordan?

Mr. JORDAN. The Conference Board is affiliated with the national associations of manufacturers in the major industries of the United States. Its primary activity is scientific research into industrial and economic problems.

The CHAIRMAN. Did not your organization issue a document or pamphlet about two years ago on the agricultural situation? Mr. JORDAN. Yes.

I have here, Mr. Chairman, a statement which probably will require about 15 or 20 minutes.

In response to the request of the committee I submit the following statement of my views concerning the agricultural situation in the United States and the legislative measures under consideration for its improvement. It is offered in my individual capacity as a professional economist and student of the agricultural problem and not as a representative of the National Industrial Conference Board. What I say in this statement and at this time represents my personal

views only and must not be taken to commit the board or to reflect its views in any way.

Senator NORRIS. Are we to get the idea from that that your views are not in harmony with the views of your organization?

Mr. JORDAN. I would be unable to say whether they are or not, because the National Industrial Conference Board has never expressed any opinion or formulated any judgment regarding agricultural relief measures, to my knowledge.

Senator NORRIS. Your connection with that board is for the purpose of giving them information on which they can formulate such an opinion?

Mr. JORDAN. Exactly.

Senator NORRIS. You have reported to them, of course?
Mr. JORDAN. I have.

Senator NORRIS. Have they acted on it?

Mr. JORDAN. No; they have not.

In 1926 I prepared, with the assistance of the research staff of the Conference Board, a book entitled "The Agricultural Problem in the United States," which analyzed the economic situation of agriculture and the factors affecting it, on the basis of official and authoritative information, covering the period from the end of the last century to 1926. I offer a copy of this book to the committee for its information as part of my testimony.

Although this study was made three years ago, I see no reason to withdraw or materially modify any of its conclusions. So far as I have been able to ascertain they are as true to-day as when they were written. They relate, however, only to the economic condition of American agriculture and its causes, and not to methods of farm relief. Those conclusions regarding the economic position of agriculture are now familiar and generally accepted by all men who are open-minded and conversant with the facts. They need not be repeated here. The primary question is now as to what shall be done.

I do not believe that the economic condition of American agriculture has materially improved during the past six or seven years following the postwar depression.

Except in certain branches and certain sections our agriculture is a bankrupt industry. It is the weakest part of our economic structure and it will continue progressively to decline unless vigorous efforts are made, by governmental and private interests, to rebuilt and restore it. Its restoration and preservation require its complete reorganization. Such reorganization requires effort on the part of the industry itself, under intelligent leadership and with the cooperation of other groups. It requires also a broad, carefully constructed national policy of governmental action. Such action is justified by a paramount national interest, for agriculture is the fundamental and essential industry of the Nation.

If no vigorous and effective action is taken, our agriculture may gradually reorganize itself in the course of time, but this will require 50 or 100 years, and entail great hardship and enormous loss, and I believe that it is more likely to fail altogether. The United States can not afford to take this chance.

Such reorganization of our agriculture is made imperative as a consequence of vast forces and profound changes over which it has

little or no control. Among the most important of these are: The complete occupation of our land resources with the disappearance of the virgin-land frontier; changes in land fertility through exhaustion and erosion; changes in climate and in soil through deforestation; changes in the rate of population growth through immigration policies and birth control; the concentration of population in cities: changes in consumption of farm products due to alterations in dietary habits, in standards of living, and in industrial demands; the decline in the export market for farm products; the growth of industry and changes in industrial organization and methods; the increase in public expenditures and the changes in the sources and methods of taxation; changes in transportation methods and marketing requirements; changes in international financial relations of the United States and the protective-tariff policy of this country.

Because of these forces and as a result of these changes our agricultural industry finds itself in the following situation: It is employing too many people, on too much land, of the wrong kind, in the wrong place, producing too much of the wrong thing, frequently in the wrong way, and usually with inadequate means of disposing of its product. A large part of our agriculture is still in the primitive soil-mining stage. We are wasting millions of acres in growing cereal crops for which our domestic demand is declining and our export markets vanishing and which let our soil wash into the sea. We are spending millions of dollars in reclaiming or irrigating land that is not and will not be needed for a hundred years. We are allowing millions of acres of crop and pasture and cut-over land to stand idle in brush without any effort to grow the wood and tree crops for which there is increasing demand, while we import pulp and newsprint and vegetable oils and animal fats from abroad. We have two or three million farmers growing things nobody in this or any other country wants at a price that will not pay anybody to raise them. We have millions of farmers trying to raise these and other things on land unsuited for them, on farms too small to afford a living, with tools and equipment and power too inadequate and ineffective to yield more than the average daily wage of the unaided hand laborer the world over, or too large and costly for the scale of operation. There are millions more producing things which we and the world need, but with no effective means of putting them in our hands at a price that will pay for producing them.

In consequence few farmers are making a decent standard of living. The best are leaving the farms, our land resources are being wasted, the city consumer is paying too much for his farm products, his cost of living and his wages are too high, he is overtaxed because the taxable resources of the country are being dried up, the expansion and profitableness of industry are hampered, and the economic progress of the Nation is retarded.

The problem of agricultural reorganization involves four elements: The amount and character of our land resources that are to be used: the uses to which they are to be put, in terms of the amount and kind of crops to be grown on them; the number and kind of people who are to produce these crops; and the methods they are to employ in producing and selling them. Agricultural restoration means putting the right men, in the right numbers, on the right land, producing the right things, in the right amount, and in the right way.

A public interest attaches in different degrees to all these four elements of the problem, and in so far as governmental action is required and is taken to assist in the reorganization of our agriculture, such action must apply to all these elements. No national policy can be complete and effective which does not exercise some control over them in the public interest and which is designed exclusively or chiefly to affect the economic fortunes of those who happen. to be engaged in farming, regardless of how many they are, what land they are using, what and how much they are producing, and how they are producing it.

We may perhaps ignore the question of agricultural methods from the point of view of governmental policy, leaving that factor to the individual discretion aided by such support as the Government can provide through education and technical research. But if agricultural reorganization is to be achieved, and if Government is to aid effectively in it, it can not ignore or leave wholly to chance or to the operation of economic forces the determination of what land is to be used, what it is to be used for, and by whom. We recognize and express in governmental control the public interest in the utilization of our water power, our oil and other mineral resources, our transportation system, our roads, and our credit resources. There is an even greater public interest in the utilization of our land. resources because they are irreplaceable and without substitute.

The reorganization of our agriculture requires, therefore, a frank recognition of the justification and need for public control and private cooperation in determining what and how much of our land shall be utilized, what crops and how much shall be produced upon that land, and how many workers shall be employed in producing them. This must be the basis of our public policy and our specific governmental action toward agriculture, and no other can justify public support.

The only question and the crucial question that we have to consider and which your committee and Congress are charged to consider at this time, is how far such public policy is to be carried and how it is to be concretely and specifically expressed in legislation. In answering this question by legislative action there are three dangers to be avoided: First, the danger that we shall do nothing at all because we are afraid to go too far; second, the danger that the defects and weaknesses in the means provided to carry out our policy may prevent us from carrying it as far as we are willing to and should carry it; and third, the danger of supposing that governmental action alone can take us as far as we need to go in our policy. I believe that all of the measures for farm relief which have so far been seriously considered in Congress in recent years are defective in one or more of these respects. I do not wish to criticize any of these measures in detail from the point of view of their practicability or adequacy in carrying out a general public policy toward agriculture. What I wish to emphasize is that none of them frankly embraced and courageously declared the policy which they all in some degree implied because they failed to grasp clearly and definitely what this public policy must be or avoided stating it explicitly and frankly. The concrete means which they sought to provide for carrying it out were, in my opinion, vague, uncertain, and unreliable.

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I believe, therefore, that the time has come, at this important juncture and on this special occasion, for the Congress of the United States to make an explicit and definite declaration of national public policy toward its agriculture. It should courageously recognize and declare that the use of the land resources of the United States is impressed with a public interest, and that agriculture in all its branches. which consists in the direct utilization of the national land resources, is therefore likewise impressed with a public interest. This, in my opinion, is the first and basic step in the construction of a national agricultural policy. Having declared that agriculture is impressed with a public interest, it is then possible to consider and formulate in specific terms the extent to which and the manner in which that public interest should and can be expressed in terms of governmental control. The limits and the direction of action in this respect are, in my opinion, clearly indicated. Congress can not constitutionally deprive individual producers of farm products of their freedom to engage in producing what they wish, where they wish, and as they wish to. It can, however, indirectly control and regulate the activities of individuals engaged in the utilization of the national land resources if the latter and their utilization are declared to be impressed with a public interest. This it can do by virtue of the interstate commerce clause of the Constitution, through which it can control the movements of farm products entering into interstate commerce by regulating the channels through which such commodities move. The Federal Government can administer and safeguard the public interest in the national land resources and their utilization, by thus influencing directly or indirectly the amount and character of the land resources brought into use, the crops for which they are used, and the number of people who can engage in their production. Such action would leave a large scope for free individual and group action, because a large part of our agricultural production is consumed locally or within the States and the problems involved here can be met by local or State action.

Following the basic declaration of public policy, therefore. I believe that the second essential step toward administering that policy is the establishment by Congress through appropriate agencies of monopolies in the distribution of farm products through the channels of interstate commerce. Such monopolies established, regulated, and administered under Federal charter or incorporation or license, with or without Federal financial assistance, are in my opinion essential to safeguard and administer the public interest in the national land resources and their utilization.

At what point in the channels of interstate commerce those monopolies should be established, whether or not they require and should have financial assistance in their organization, what their relation to State and national cooperative associations of producers should be, and how they should be regulated are matters for careful consideration by this committee which has broad knowledge and long experience of governmental organization and administration. I venture to express an opinion only on a few points of detail regarding the control, organization, and operation of such monopolies.

I believe that on the basis of such a declaration of public policy as has been suggested Congress has and may properly exercise the power to establish and provide means of administration of such