I want you to know that we wish to give you that opportunity, but I also want to state for the record that this is not a full scale study of the milk industry, and, therefore, we will take your statement as briefly as possible, and ask if you would be good enough at some future date to present your views in more detail in Washington. I know that you made a trip from New Jersey-that is where you are from

Mr. LEVIN. I should explain

Mr. ANFUSO. And therefore, I might ask you, if you would not mind, to be as brief as you can for this afternoon's hearing.

STATEMENT OF GEORGE C. LEVIN

Mr. LEVIN. I am so grateful for the opportunity to be here that I shall be more than brief. Part of the subject that I wanted to cover has been covered, I think, by Mr. Chalek.

I am one of those unhappy dairy farmers that the chairman commented upon. I own and operate and have for many years a dairy farm in Suffolk, N. J., 290 acres and now have about 50 dairy cows. In addition, I happen to be a practicing lawyer in the city of New York.

In or about 1953, when the dairy farmer situation became very serious, I tried to find out what was happening to me. I supposedly am of average intelligence and I could not find out the reason for the dilemma I was in, at a time when everybody was enjoying prosperity and has been for 4 years since.

Everybody knows that a dairy farmer has been suffering since 1953 a very serious depression.

As I studied this very complicated industry which will take more than the few minutes that I have to even touch the highlights, I came to certain definite conclusions, some of which I wanted to leave with your committee, and at some future date, in view of your chairman's admonition, I would like to supply further data.

I say that the trouble is that the dealers in this city, as Mr. Chalek has started to explain, constitue a monopoly. These do not want to do anything to disturb existing conditions. The best evidence of that fact is what has happened with respect to the gallon job. Your chairman commented about the Washington market. He said that the distribution system as there exemplified is ancient and antiquated as compared to most business.

I think way back in the investigation of 1939 it was found that the milk-distribution system is the same as in the horse-and-buggy days. In the city of Washington today and for the past 2 years, milk has been sold in gallon jugs for 78 cents. You gentlemen who live in Washington have often seen this advertisement of High's, a chainstore, which successfully markets milk at 78 cents a gallon.

That practice has been adopted in other jurisdictions.

In Chicago, milk has been sold by the gallon for 77 cents for years; in Milwaukee for 65 cents; in Springfield, Mass., for 78 cents; and in Akron, Ohio, for 60 cents.

You heard the ladies this morning tell you that they went and bought milk for anywhere from 26 to 28 cents per quart. They could buy it in our stores in half gallons and maybe save a penny, but they cannot buy it in gallons.

I ask you, gentlemen, to find out through your great powers why we cannot have gallon jugs in New York.

For years, interested parties have fought to try to get a bill through the New York Legislature legalizing the sale of gallon jugs; last year it finally went through. The bill was vetoed. This year the bill was passed. It was signed and approved by Governor Harriman on April 29 of this year.

I ask you, gentlemen, to find out for me and the rest of the dairy farmers why there is no sale of gallon jugs of milk in the metropolitan area, the richest, biggest, the most prosperous milk market in the world.

Why do I emphasize gallon jugs? If you sell milk in gallon jugs and bring down the price, that immediately increases consumption— the trick is to increase consumption.

I dispute the chairman that there is a surplus of milk in this area. There is a spurious surplus. This is a forced underconsumption by maintaining too high a price by paying to the truckman and the pasteurized workmen more money than they are entitled to for the little work they do in comparison to the hard work and effort put in by the dairy farmers.

When I am talking to this committee I am not talking for myself because I can make a living without my farm. But, gentlemen, it hurts me as I go around the countryside, and I see the serious plight of God-fearing men who work hard, who have the risk of disease in their herd, the vicissitudes of the weather to contend with, and they cannot make a living.

I call to Your Honors' attention

Mr. COOLEY. That is all right.

Mr. LEVIN. I forget where I am. You are still Your Honors. I call attention to the fact that in my community, in the northwesterly part of the State-you may not be able to find it on the map, it is so small-we are in the center of the dairy industry. We had originally 800 farmers in the dairy business in our country. That has been cut down in recent years to 400.

The New York milk shed which in 1950, I think, had 50,000 farmers delivering milk to this area has dwindled in those elapsed years by 7,000. Why is it nobody gets excited about that and wants to know why that is happening?

We do hear a lot of talk about small-business men and little industry and protecting them. There is the finest and most fundamental small business in this community. Why isn't something done to find out something about its difficulties?

It is only when they are stupidly led and decide to strike. Why do these men decide to strike? What is it that causes it?

Three large farm machinery companies in my area have given up their franchise and do not have any dealers. When those large companies whose names I won't mention and who are listed on the Stock Exchange, withdraw their dealerships it is a serious thing for their workmen, I think, out in Iowa, who lose their jobs, because that is repeated in other communities.

One of the basic reasons-I am trying to go over this very rapidlyis what Mr. Chalek testified on price. That is the difference between the manufactured price and fluid milk price.

All of you know, particularly those of you who may come from the Midwest, that the manufactured product brings a smaller price, although it is the same pure fine milk.

Historically years ago to meet certain conditions we had a system devised whereby to encourage the dealer to take all of the milk that the farmer produced, he was given virtually a bonus. He was given that milk which he used for manufacturing purposes at a reduced price.

Well, the big milk dealers are pretty clever. They found out that the money is in the manufactured product, in the ice cream, in the butter, in the milk powder, and they started to sell that product. They do not buy or sell fluid milk beyond a certain level, and the best proof of that is, What do they advertise? Where do they spend their money? This is from a New York daily paper. On one side you see Breakstone-they are a subsidiary of National Dairy. It is trying to sell Breakstone's Cream Cottage Cheese. The milk that goes into that cheese it gets at about 30 or 40 percent discount.

The same thing with Borden who are trying to sell Starlac, that is trying to educate our community away from drinking fluid milk because it makes more money out of milk powder which is a class 3 product. That ad appeared in almost all of the New York papers on Thursday. But I didn't see any great big ads for milk.

I will go to one other point and then I will desist.

Here is a full-page ad which cost a lot of money. If I am correctly informed this ad in the New York Times on Thursday, September 26, 1957, published by Kraft, subsidiary of National Dairy Corp., is pushing margarine. I say it is reprehensible for National Dairy to compete with the farmers of this country to promote in this fashion the sale of margarine which kills the sale of butter, upon which the prosperity of milk is founded; it ought to be legally forbidden.

The milk market administrator in fixing prices ought to take into consideration the amount of milk which goes into butter which is diverted because the sale of margarine is increased. Every time you sell margarine you lose a butter customer. Every time you lose a butter customer you push down the price of milk nationally. Mr. ANFUSO. May I have that for the record?

If I may, I would like to incorporate these two ads into the record.
Mr. LEVIN. I apologize for taking so much time.
Mr. ANFUSO. No apologies are necessary.

As one member of the

committee whispered to me, "We wish we had more time." I hope you won't mind coming to Washington.

Mr. LEVIN. I want to thank the committee for allowing me to be here today. It is a privilege.

Mr. COOLEY. I should like to join with Chairman Anfuso in thanking you for your appearance and for your splendid statement. Having presented the statement, what recommendation do you suggest? You are a lawyer and you are learned in the law. Do you visualize your problem or the problem of the dairy farmers of this State as a problem that could be appropriately considered by Congress or is the trouble right here in the State of New York?

Mr. LEVIN. It is twofold. The conditions are aggravated in New York, but the same conditions obtain in other parts of the country.

I tried to read up on this very complex industry, and I have a few suggestions.

One is publicity. More hearings like your committee is conducting which I hope will be ventilated in the press. Our public does not understand how milk is priced. Our public is suffering under the misapprehension that the farmer gets a subsidy. They do not know there has not been a subsidy paid to the dairy farmer since December 1945. They do not know the intricacies of the Government support program.

I would like to express my gratitude to you, Congressman Cooley, for what you have done in litigation that you have aroused which resulted in a decision in favor of the Department of Justice against the Department of Agriculture under which some large companies are at present under duty to pay back some quarter of a million dollars, and if other litigation now pending results the same way it will be close to $2 million.

The support program is not for the dairy farmer. It is for the large processor, and I am not going to hesitate to mention names. The large processors are Borden, National Dairy, Foremost, Pet Milk, Carnation, and companies of that type who operate on a national basis. They get the money when they turn it over to the Commodity Credit Corporation, nonfat milk solids and butter and Cheddar cheese. The dairy farmer does not get it.

Mr. COOLEY. You are right about that. I think there is one thing that we failed to do and that is to maintain better public relations for agriculture than we have maintained in the past year because, as you say, the average citizen does not understand the problems of agriculture at all.

Mr. LEVIN. That is right.

Mr. COOLEY. I mentioned the fact a moment ago that you had unhappy farmers in New York. They are unhappy. I know what I am talking about. Governor Harriman signed a bill legalizing the sale of milk in gallon jugs you wondered why they were not being used.

Mr. LEVIN. That is right.

Mr. COOLEY. From what I heard here today I am inclined to believe that some sort of monopoly does exist

Mr. LEVIN. There is a monopoly.

Mr. COOLEY. In this business in New York City?

Mr. LEVIN. There is a monopoly. The United States attorney of this district ought to start an action against these big companies and the big cooperators whom I say are not working in the interest of the farmer. Why haven't they spoken up? Why do I have to come before the committee and tell you these facts which I am developing? They are collecting I think $2 million annually from the milk marketing administrator. That money is given to these cooperatives to represent the dairy farmer not to sit there asleep and try to maintain the status quo which they feed. I say liven up these dairy co-ops. Mr. ANFUSO. Thank you. We do have your address?

Mr. LEVIN. Yes, sir. My home address is 115 West 55th Street, New York City. My farm is Shale Hills Farm, RFDS.