the Secretary of Agriculture, or also prefer to have us amend this law so that it provides specifically that the Secretary of Agriculture must pass upon all those prices relating to agricultural commodities, meaning by that the raw material and the processed foodstuffs.

Mr. Goss. It seems to me if we are going to place the responsibility of production on the Food Administrator he should be the one who has the veto power.

Mr. CRAWFORD. Then in that case amending this law along the lines discussed here earlier in the morning session would not suffice, would it? In other words, if we take and amend this language and provide that the Secretary of Agriculture shall have the power to determine what these prices shall be, both on raw farm products and processed foodstuffs, in doing that we would not accomplish this last thing which you mentioned, if I understand you correctly.

Mr. Goss. With Claude Wickard and Chester Davis there, you might accomplish it because they are working very closely together and presumably would. However, you have no guaranty.

Mr. CRAWFORD. Exactly; you have no guaranty, either, they will be there.

Mr. Goss. If one is subject to the control of another you may find you have two horses pulling in opposite directions.

Mr. CRAWFORD. That is what I wanted to bring out here because I got the impression awhile ago by reason of the questions that were submitted I think by the chairman and Mr. Wolcott and your reply thereto that the committee might be steered in a direction of amending this present law so as to provide that the Secretary of Agriculture should have the power to pass upon these prices which govern on farm raw materials as well as processed foods. I want to correct that so that the committee gets straight the idea of placing all this under the control of Chester Davis, the Food Administrator. Now, frankly, I would not be in favor of leaving the power in the hands of the Secretary of Agriculture to govern Mr. Davis, if Mr. Davis is to be the Food Administrator. I would just as soon have the situation the way it is now. I want to give you a chance to express yourself as between those two. That is, do you now recommend we proceed to place the whole administrative problem in the hands of a food administrator who would be independent of all other forces except the Congress?

Mr. Goss. That would be my recommendation. In saying that, I do not want to leave the impression that we have any lack of confidence in Claude Wickard at all, because we think he has done his best to do a good job. But from an administrative standpoint the man who has the responsibility should have the authority.

Mr. CRAWFORD. I agree with that observation. Now, let me ask you this question: Assuming we did revise the law so all these powers to which you have referred in all of your statements are concentrated in the hands of the Food Administrator, do you believe that he can do a reasonably successful job if Congress fails to do two other things-first, materially increase the tax burden, and, second, bring into operation enforced savings?

Mr. Goss. He can do a better job than is now being done. I doubt if you are going to be able to dam that source up without draining some off. However, if Congress failed to do that and he had the responsi

bility of stopping inflation he could do it with a rise in prices which would drain off that surplus but at that point your white-collar man would suffer terribly.

Mr. CRAWFORD. Correct. Could the administrator in the absence of advancing those prices to the point where they will economically murder the white-collared or fixed-income citizens prevent a black market in the absence of taxation and enforced savings?

Mr. Goss. No; not wholly. You are not going to be able to prevent black markets completely in any situation but if he had rationing in his hands he could go a long way toward preventing a black market.

Mr. CRAWFORD. I agree with you on that part, going a long way. But I may carry that just one more step further. If we leave in the hands of the pay rollees of this country the $100,000,000,000 they are to receive this calendar year scaling off only that much which is now called for by present tax burdens, assuming the conference bill goes through, and let them further scale that down through purchases of Treasury issues on the scale at which they have been buying them including the last issue of April and on a voluntary basis, how can any man, Chester Davis or anybody else prevent those people along with the others who are not pay rollees from developing and supporting a black market in this country that will wreck the whole picture? Personally I do not see how he can do it. I want to see if you think he can do it.

Mr. Goss. It would be flirting with a very dangerous situation. I am inclined to think it would be impossible. I think part of the program necessary will be either taxation or forced savings or preferably both. Mr. CRAWFORD. I agree with you.

Mr. SPENCE. This morning I received several telegrams, some from packers, and some who said they represented the producers. Here is the substance of them: "To place the roll-back prices in effect June 1 would result in complete ruin to the packing industry. I cannot emphasize too strongly the losses to the industry if this proposed regulation is placed into effect." What is your opinion about that?

Mr. Goss. I do not believe we can roll back prices without giving consideration to costs of production without ruining industry and I do not believe any system of subsidies could be devised which could lie equitably enough to do justice and save the industry. I think we have to approach that by economic means which I have outlined here.

Mr. SPENCE. Are you familiar with this order that is going into effect; of course, you are?

་

Mr. Goss. Well, roughly.

Mr. SPENCE. That is, with reference to the packing industry and producers of meat?

Mr. Goss. Roughly.

Mr. SPENCE. What effect will that have on the producer?

Mr. Goss. I don't know, Mr. Spence. I am inclined to think that the biggest loss lies in inventories and that the immediate effect on the producer will not be as great as on the packer. But I would not want to stand on that. I really do not know.

Mr. SPENCE. All of the packers in my district, there are several not very large ones, they are moderate-sized packers, they all say it is going to ruin them. They won't be able to continue in business.

Mr. Goss. Well, I would not know whether that is correct or not. I know that some of the packers have been ruined annually and still have

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stayed in business. But I do not mean to say they are wrong in this. Packers with large inventories will be heavy losers.

The CHAIRMAN. They never had this identical situation.

Mr. SPENCE. It is essential for the benefit of the farmer, too. He is interested in the maintenance of the packer, is he not?

Mr. Goss. Yes.

Mr. SPENCE. That is where his market is.

Mr. Goss. Yes.

Mr. SPENCE. He wants to see the packers get along reasonably well. Mr. Goss. Yes. The farmer is interested in seeing that everyone who handles his products from the time it leaves the farm to the time it gets to the consumer gets a reasonable compensation for it. We want to see all excess handling cut out and we want to see anything in excess of reasonable compensation cut out. But we have no quarrel with the middleman as such.

Mr. SPENCE. One of the telegrams I received said they represented the producers and they were opposed to this also not only because of the effect on them but on the packer as well.

Mr. Goss. I am not familiar enough for my opinion to be of any value, I am afraid.

The CHAIRMAN. Mr. Goss, the committee is glad to have heard you and appreciates your attendance. You have given us an informative statement and discussion on this bill, and we thank you for it.

The committee will meet at 3 o'clock, at which time Mr. Handschin, who is the legislative representative of the National Farmers Union, will be with us.

Mr. Goss. I appreciate the committee's patience.
(Whereupon the committee recessed until 3 p. m.)

AFTERNOON SESSION

(The hearing resumed at 3 p. m.)

The hearing reconvened at 3 p. m., Hon. Henry B. Steagall (chairman) presiding.

The CHAIRMAN. The hearing will come to order.

Mr. Hull wishes to make a statement for the record at this point. Mr. HULL. Mr. Chairman, may I submit this observation regarding the important matter of factory labor for the canneries in the Northwestern States? I have received the following telegram from the Wisconsin Canners Association. That association probably has in its membereship all of the canneries in Wisconsin, and presumably speaks for them in the telegram. It refers to the important matter of increasing canned-food production in the Middle West this year:

At a meeting of representatives of Vegetables Canners Association of Wisconsin, Illinois, Indiana, and Minnesota with Chicago regional office of War Labor Board, canners were today informed that petitions filed by State associations for voluntary wage increase to obtain labor desperately needed for canning 1943 vegetable packs will not be considered. These petitions were first taken up in Washington last December and have been filed with the War Labor Board nearly 2 months. Under directive from Byrnes' office War Labor Board now insists on individual applications from more than 400 canning plants which will involve paper work requiring at least a month with information as to 1940, 1941, and 1942 rates which in many cases probably cannot be obtained. This means that 1943 vegetable packs will be in large measure lost. Asparagus crop already suffering severely in all States named for lack of canning labor and recruiting must be done immediately if pea pack is to be saved. Recruiting impossible until wage increase can be granted and question of price amendment determined. We believe plan

of individual applications under Byrnes' directive of May 10 unworkable and imperative that some over-all plan be worked out for canning industry either by exemptions similar to agriculture or by granting group of area increase. Seriously urge your immediate consideration and assistance in revising directive of May 10. WISCONSIN CANNERS ASSOCIATION.

Immediately upon receipt of this telegram I got in touch with the War Labor Board which immediately took up the matter with the Chicago office. On May 20 I was advised by telephone from the Chicago office that the labor situation in the Wisconsin canneries could be handled without requiring individual applications. There the matter seems to rest. This is another illustration of the manner in which the bureaus in Washington are interfering with the production of the food supply which our country so badly needs. There is no good reason why this matter of labor in the canneries should not have been taken up and disposed of long ago. The canning season is now opening in Wisconsin, and in other Northwestern States. Unless something is done to obtain the desired help, canneries will not be able to operate at full capacity, and there is bound to be a shortage instead of an increase in production of canned goods.

In connection with this same matter, I would call your attention to a release, evidently put out by the O. W. I. under the heading of "Labor Prospect Bad for Canning Plants." O. W. I. admits that a very serious situation exists. It states that in the Middlewest last year tons of food rotted because of the lack of labor at a critical time. It predicts the same thing may happen again this year. It estimates that fully 400,000 workers will be needed at the peak of the canning season, which will come along in June or July.

LABOR PROSPECT BAD FOR CANNING PLANTS

Wastage of crops and a tightened supply of canned and processed foods is probable unless sufficient manpower is available when the canning season begins, the Office of War Information said today.

During the canning season last year, the Office of War Information said, only superhuman efforts of volunteers filled the labor gap in some communities where the draft and the shift of workers to higher-paying war jobs had depleted the usual supply. In other localities tons of food rotted. Much of the Ohio and Indiana tomato crop spoiled because of sudden ripening and a labor shortage.

This year, said the Office of War Information, the normal reserve of experienced local canning labor shows signs of serious depletion exceeding that of 1942, yet the demand of canned and processed foods will be far greater than ever before.

Essentially a season, home-town industry manned by local workers who are otherwise occupied during the off-season, the canning industry employs about six times as many persons in September as in May. The War Manpower Commission estimates that about 400,000 workers will be needed when the peak is reached this year.

Your committee has no power to remedy the situation. I am offering this information merely to make record of what is transpiring as to the production of food supplies, and of the difficulties which processors in our western States are experiencing in their endeavors to meet the demands of the Government for increased production.

The CHAIRMAN. Thank you, Mr. Hull.

Mr. Robert Handschin, legislative secretary of the National Farmers Union, of Washington, D. C., who has been with the union for 5 years, is here to represent them in the consideration of this bill. He is with us this afternoon and the committee will be glad to hear him.

STATEMENT OF ROBERT HANDSCHIN, REPRESENTING THE NATIONAL FARMERS' UNION, WASHINGTON, D. C.

Mr. HANDSCHIN. For the benefit of some members of the committee with whom I do not have the pleasure of being acquainted, I have been with the Farmers Union office here during the past 5 years, and I am representing our president, Mr. Patton, who could not be before the committee today, who expressed his regret in that regard. I would also like to take this occasion to pay our respects to this committee which has handled as you know, better than I, quite a number of pieces of legislation during the past years dealing with credit in particular for farmers.

On several of those matters we have been firmly behind the committee on and some we have not been as firmly behind the committee.

The bill that is now before the committee to extend the life of the Commodity Credit Corporation until 2 years after the duration of the war, or for 4 years, whichever is shorter, and to increase its borrowing power and to change the basis of its inventories, has in general our support as it now stands. However, I would like to suggest one or two limitations to that bill.

In the first place, I think it is clear to members of the committee that with the commitments that we have outstanding in the Triple A making loans mandatory on our basic commodities and the commitments on Government purchasing under the terms of the Steagall amendment for the duration and 2 years following, that the Commodity Credit Corporation has to be continued or some agency with similar powers put in its place.

Secondly, the term of extension is a matter which this year is different than it has been in any of the previous times that the Commodity Credit extension has come before this committee.

We are in the middle of a war, a very complicated and difficult war, and the Commodity Credit Corporation is extending price floors to more and more farm commodities. We are very much in favor of that practice and we look upon it as one of the chief needs of agriculture, and we are glad that your chairman and this committee have placed in the legislation adequate provisions to keep those floors at least at 90 percent of parity.

But in extending those floors, it is necessary to do so very often on more than one growing season. I am thinking in terms of the production of livestock products where our production cycle is longer than a growing season. That is, of course, your dairy products, and beef cattle.

If the Commodity Credit Corporation is going to be able to give farmers assurance on which they can plan their production in advance, it needs to have a sufficient length of life that it can give those assurances for the duration of the war, or for long enough periods to take that much risk, at least, out of the production of those types of livestock.

Therefore we feel that at this time under the circumstances, it would be advisable to extend the life of the corporation roughly as far as it is invisioned in the bill now before the committee.