753 922al iSTfwXIinSTHlSB Hem ^nrfe H^tt (College of J^grtcuUurc J^t QPacnell Hmtietrsttg Strata. ST. 1. HD 1753 i^9''2'2a'""'"™"'"-"'"^>' 3 1924 013 718 253 The original of tiiis book is in tine Cornell University Library. There are no known copyright restrictions in the United States on the use of the text. http://www.archive.org/details/cu31924013718253 .^^™d§?S^^'} HOUSE OF REPRESENTATIVES { ^No^'ir REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE January- 23-27, 1922 New Willard Auditorium Washington, D. C. March 3, 1922. — Ordered to be printed • ■ WASHINGTON GOVERNMENT PRINTING OFFICE 1922 TABLE OF CONTENTS. Page. Correspondence between the President and the Secretary of Agriculture. 3 Address by the President of the United States 6 The purpose of the conference, by the Secretary of Agriculture 13 Agricultural prices and the present situation, by Hon. Sydney Anderson__ 15 Agricultural conditions in the Northeastern States, by E. B. Cornwall 27 Agricultural situation in the cotton belt, by James W. Morton 30 Agricultural conditions in the corn belt, by A. Sykes 33 Agricultural conditions in the spring-wheat area, by John H. Hagan 35 Agricultural conditions in the range country, by, Fred H. Bixby 39 Effect of the agricultural depression on the implement industry, by W. H. Stackhouse 42 Effect of the agricultural depression on the milling industry, by James F. Bell 43 Effect of the agricultural depression on the meat-packing industry, by Thomas Wilson '. 45 Effect of the agricultural depression on the fertilizer industry, by Charles H. MacDowell , 49 European situation in its relation to American agriculture, by Dr. G. F. Warren , 54 Financing agriculture during the emergency, by Eugene Meyer, jr 63 Financing policy in its relation to the price level, by Dr. Wesley C. Mitchell -• 70 Fundamentals of cooperative marketing, by G. Harold Powell 74 Place of the independent distributors, by William L. Wagner 84 Marketing of cotton, by Gov. John M. Parker 86 Cooperative cotton marketing, by Carl Williams 89 Grain marketing, by Robert McDougal 92 Cooperative marketing, by J. M. Anderson .:. 96 Need of a food supply for an increasing population, by Dr. E. D. Ball 99 National forestry policy, by Gifford Pinchot 106 National policy for land utilization, by Dr. Bichard T. Ely 111 National policy for agricultural research, by Dr. Raymond A. Pearson — 121 Farm woman and the farm home, b^ Mrs. Charles W. Sewell 129 Concluding remarks by the Secretary of Agriculture 131 Reports of committees and resolutions 137 Report of committee No. 1, agriculture and price relations 137 Report of committee No. 2, agricultural credit, Insurance, and taxa- tion 139 Report of committee No. 3, transportation 141 Report of committee No. 4, foreign competition and demand 147 Report of committee No. 5, costs, prices, and adjustments 148 Report of subcommittee 5A — In the cotton belt 150 Report of subcommittee 5B — In the wheat regions 153 Report of subcommittee 5G — In the corn belt 155 Report of subcommittee 5D — In the dairy regions 157 Report of subcommittee 5E — In the range country 158 Report of subcommittee oF — In the tobacco districts 160 Report of subcommittee 5G — In sugar production 160 Report of subcommittee 5H — In fruit and vegetable production.. 161 Report of subcommittee 51 — In cost and price studies 162 Report of subcommittee 5J — In Negro farm problems 163 Report of committee No. 6, crop and market statistics 164 Report of committee No. 7, marketing of farm products 170 1 Z TABLE OF UONiJffW'lb. Eeports of committees and resolutions — Continued. Pas*- Report of committee No. 8, agricultural research and education 176 Report of committee No. 9, a permanent forest policy 177 Report of committee No. 10, national land policy 179 Report of committee No. 11, farm population and farm home 180 Report of committee No. 12, coordination of State and Federal legis- lation 182 General resolutions offered from the floor and passed 3S4 General survey of recommendations of conference 185 List of delegates to the National Agricultural Conference 186 Personnel of committees 19.'5 Section B. Waterway transportation 201 Minority report of transportation committee, by Hon. Peter G. Ten Byck 201 REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. Correspondence Between the President and the Secretary op Agriculture. The White House, Washington, December 30, 1921. My Dear Mr. Secretary : In harmony with our conversation of a few days ago, I am writing to ask you to call a national conference to consider the agricultural problems of the American people. We are all well aware of the severe agricultural depression which exists throughout the land and the extraordinary conditions which brought about the present situation. No one will pretend that the present conditions could have been avoided, but none of us is willing to agree that there ought not be some corrective and constructive steps taken to remedy the severe hardships under which so important a portion of our productive citizenship is struggling. I am convinced that a conference may be made a very helpful agency in suggesting practi- cal ways of improvement, particularly if brought into coordination with the helpful investigation which has been begun by the con- gressional committee committed to a related work. Such a conference might divide itself into two parts — one part to give consideration to our present-day difficulties, which, though tem- porary, are serious and need effective attention; the other part, a survey of the future in an effort to determine upon general policies, having in view the maintenance of production, the greatest possible use and at the same time the conservation of our agricultural re- sources, and the more complete coordination of our agricultural, manufacturing, iand general business interests. It seems reasonably certain that, as the world comes out of the present period of disorganization, this country may find itself con- fronting new conditions which may very directly influence both our agricultural and industrial life. We should anticipate such changes and endeavor to prepare for them. It is unthinkable that with our vast areas, our unparalleled endowment of agricultural resources, our fertility of soil, our vast home market, and the great ability and resourcefulness of our farmers we should accept the status of a dis- tinctly industrial Nation. Our destiny seems to require that we should be a well-rounded Nation with a high development of both industry and agriculture, supporting one another and prospering together. It must be, and I feel sure it is, the national wish and pur- pose to maintain our agriculture at the highest possible efficiency. It is unquestioned that a conference will bring us to a clearer un- derstanding of the problems before us. I would like you to bring 3 4 EEPOET OF THE NATIONAL A&EICtn,TTJBAIi OONFEEENCE. into the conference not only the ablest representatives of agricul- tural production, which shall represent our great country in the broadest possible way, but I think much good would come if you will include in the conference those who are engaged in industry most intimately associated with agriculture. It will clarify our views if we may have present representatives of the more important interests which are closely related and dependent on agriculture. I trust these representatives will be invited. I must leave the make-up of the con- ference to your more intimate knowledge of those who may confer most helpfully, but I will be glad if you will immediately issue invi- tations so that both the country and the Government may have the benefit of the earliest possible suggestions which will come from such a meeting. Very truly yours, .Warren G. Harding. Hon. Henrt C. Wallace, Secretary of Agriculture, Washington, D. G. Department or Agriculture, Washington, February 6, 1922. Dear Mr. President : Upon receipt of your letter of December 30, 1921, in which you directed me to call a national conference to con- sider the agricultural problems of the American people, I imme- diately set about the matter of carrying out your desires. The date was fixed for Monday, January 23. A total of 439 people were in- vited to come as delegates to the conference, as follows : Farm group : Farmers 275 Farm women * 25 300 Farm officials: State officials 17 Agricultural colleges 25 Economists 6 Agricultural editors 27 75 Farm business group: Distributors 21 Manufacturers 12 Bankers 10 Transportation 9 Public men 12 64 Included in the farm group were the presidents, in most cases, of all the principal farmer organizations, as well as more than 100 indi- vidual farmers whose success and whose standing in their respective States warranted us in considering them as representative. Of the 439, 336 accepted invitations and were present as delegates. They came from practically every State and represented every phase of agricultural activity. I think I am fully warranted in saying EEPOKT OF THE NATIONAL AGBICXJLTUKAL CONFEBBNCE. 5 that never before in our history was there brought together a group of men who so completely represented the agricultural thought and practice of the Nation. During the week prior to the meeting of the conference the various delegates who accepted were assigned to 12 committees, the effort being in every case to assign each delegate to the' committee which would deal with the subject in which he was particularly interested, and on which his experience and interest would best qualify him to serve. Meeting rooms were provided for each committee and steno- graphic help and experienced secretaries were made available. This made it possible for the various committees to get to work at once. The forenoons of each day and the afternoon also of Monday were given over to discussions of various matters of immediate interest, the afternoons and evenings remaining free for committee meetings. It was a working conference. Every delegate, with the possible ex- ception of a very few who arrived late, had a place on one of the com- mittees. Representative Sydney Anderson, of Minnesota, chairman of the Congressional Joint Commission of Agricultural Inquiry, at my re- quest acted as permanent chairman of the conference. I hand you herewith a report of the conference in two parts, one of which contains the various papers and addresses and the other the reports of the various committees as they were adopted finally by the conference. Very respectfully, Henry C. Wallace. The President, The 'White House. The White House, February 13, 192%. Mt Dear Mr. Hattgen : I am sending to you herewith the letter of the Secretary of Agriculture reporting to me on the recent na- tional conference held to discuss the agricultural problems of the American people, together with a copy of the report of the com- mittees and resolutions to the conference and the proceedings of the conference. I have felt that this is a document which the Congress would very much wish to possess. I have no doubt that there is a very genuine demand for printed copies of these reports. The Department of Agriculture is with- out authority to cause them to be published. I submit them to you for such consideration and such action as you and your associates deem best. I assume that there can and will be no publication unless authorized and directed by resolution of the Congress. Very truly, yours, Wabren Q. Harding. Hon. Gilbert N. Haugen, Chairman Committee on Agriculture., House of Representatives, Washington, D, C. ADDRESSES Invocation by Eev. James Shera Montgomery, Chaplain of the House of Representatives. address by the president of the united states. Sechetaet Wallace and Membees of the Conference : It is an occasion of the greatest satisfaction to me that Secretary Wallace's invitation has been so widely and cordially accepted. I confess the firm belief that in the public life of a people so intelligent as the American Nation most problems may be regarded as well on the way to solution when they are once reduced to their simplest terms and generally understood. This conference was called with the aim to bring about such a general understanding of the critical situation now confronting American agriculture. We all understand that this conference is not a legislative body. Its recommendations will require to be written into the statute books by other authorities, or applied in administration, after sanction by those who must assume responsibility. But we do confidently antici- pate that the considerations here had will be helpful and illuminating to those immediately responsible for the formulation of public policy in dealing with these problems. Therefore, it has seemed to me, I can make no more appropriate observation than that your work, here will be of value precisely as you address yourselves to the realities, the matters of fact, the understanding of conditions as they are, and the proposal of feasible and practicable methods for dealing with those conditions. Concerning the grim reality of the present crisis in agriculture, there can be no differences of opinion among informed people. The depressions and discouragements are not peculiar to agriculture, and I think it fair to say there could have been no avoidance of a great slump from war-time excesses to the hardships of readjustment. We can have no helpful understanding by assuming that agriculture suffers alone, but we may fairly recognize the fundamental difficulties which accentuate the agricultural discouragements, and menace the healthful life of this basic and absolutely necessary industry. I do not need to tell you or the country of the supreme service that the farmer rendered our Nation and the world during the war. Peculiar circumstances placed our allies in Europe, as well as our own country, in a position of peculiar and unprecedented dependence on the American farmer. With his labor supply limited and in conditions which made producing costs high beyond all precedent, the farmer rose to the emergency. He did everything that was asked of him, and more than most people believed it was possible for him to do. Now, in his hour of disaster, consequent on the reaction BEPOKT OF THE NATIONAL AGRICULTUBAL CONFEEENCE. 7 from the feverish conditions of war, he comes to us asking that he be given support and assistance which shall testify our appreciation of his service, To this he is entitled, not only for the service he has done but because if we fail him we will precipitate a disaster that will affect every industrial and commercial activity of the Nation. The administration has been keenly alive to the situation, and has given encouragement and support to every measure which it believed calculated to ameliorate the condition of agriculture. In the effort to finance crop movements, to expand foreign markets, to expand credits at home and abroad, much has been accomplished. These have been, it is true, largely in the nature of emergency measures. So long as the emergency continues, it must be dealt with as such ; but at the same time there is every reason for us to consider those permanent modifications of policy which may make relief permanent, may secure agriculture so far as possible against the danger that such conditions will arise again, and place it as an industry in the firmest and most assured position for the future. You men are thoroughly familiar with the distressing details of present conditions in the agricultural community. The whole country has an acute concern with the conditions and the problems which ybu are met to consider. It is a truly national interest, and not entitled to be regarded as primarily the concern of either a class or a section. Agriculture is the oldest and most elemental of industries. Every other activity is intimately related to and largely dependent upon it. It is the first industry to which society makes appeal in every period of distress and difficulty. When war is precipitated, the first demand is made on the farmer, that he will produce the wherewithal fqr both combatants and the civil population to be fed, and in large part also to be clothed and equipped. It is a curious fact that agriculture has always been the first line of support of communities in war, and too commonly the victim of those distresses which emanate from great conflicts. Perhaps I may be pardoned a word by way of devel- oping this idea. Until comparatively very recent times the land was the first prize of victory in war. The conqueror distributed the subjugated soil among his favorites, and gave them his prisoners as slaves to work it. Thus the ownership of the land became the symbol of favor and aristocracy, while the working of it was regarded as the task of menials, dedicated to ill-paid toil in order that the owners of the land and the rulers of the state might be able to maintain themselves in luxury and to enforce their political authority. Coming down through the ages, we see the advance of civilization gradually emancipating the soil from this' low estate. We see the institutions of serfdom and villenage, under the feudal order, suc- ceeding those of slavery. Later we see the creation of a rural peasantry, comprising broadly those who till the soil, but in most cases do not own it, and whose political rights are very restricted. It is, indeed, not until we come to very recent times and to our own country's development that we see the soil lifted above the taint of this unjust heredity and restored to the full dignity and inde- pendence to which it is entitled. Even in our own times and under the most modern and enlightened establishments the soil has continued to enjoy less liberal institutions for its encouragement and promotion than many other forms of in- 8 REPORT OF THE NATIONAL AGRICULTTJRAL CONFERENCE. dustry. Commerce and manufacturing have been afforded ample financial facilities for their encouragement and expansion, while agriculture on the whole has lagged behind. The merchant, the manufacturer, the great instruments of public transportation, have been provided methods by \vhich they enlist necessary capital more readily than does the farmer. A great manufacturing industry can consolidate under the ownership of a single corporation with a mul- titude of stockholders, a great number of originally separate estab- lishments, and thus effect economies and concentrations, and acquire for itself a power in the markets where it must buy, and in the mar- kets where it must sell, such as have not been made available to agri- culture. The farmer is the most individualistic and independent citi- zen among us. He comes nearest to being self-sufficient; but pre- cisely because of this he has not claimed for himself the right to em- ploy those means of cooperation, coordination, and consolidation which serve so usefully in other industries. A score or more of manu- facturers consolidate their interests under a corporate organization, and attain a great increase of their power in the markets, whether they are buying or selling. The farmerj from the very mode of his life, has been estopped from these effective combinations; therefore, because he buys and sells as an individual, it is his fate to buy in the dearest and sell in the cheapest market. The great industrial corporation sells its bonds in order to get what we may call its fixed or plant capital, just as the farmer sells a mortgage on his land in order to get at least a large part of his fixed or plant capital. I am not commending the bonding or mort- gage system of capitalization, rather only recognizing a fact. But there in large part the analogy ends. Both the manufacturer and the farmer still require provision of working capital. The manufac- turer, whose turnover is rapid, finds that in the seasons when he needs unusual amounts of working capital he can go to the bank and borrow on short-time notes. His turnover is rapid, and the money will come back in time to meet his short-term obligation. The merchant finances his operations in the same way. But the farmer is in a different case. His turnover period is a long one ; his annual production is small compared to the amount of investment. For almost any crop the turnover period is at least a year ; for live stock it may require two or three years for a single turnover. Yet the farmer is compelled, if he borrows his working capital, to borrow for short periods, to renew his paper several times before his turn- over is possible, and to take the chance that if he is called upon un- timely to pajr off his notes he may be compelled to sacrifice growing crops or unfinished live stock. Obviously the farmer needs to have provisions adapted to his requirements for extension of credit to produce his working capital. Under the necessities of war time consolidation and centralization of credit resources and financial capabilities went far to sustain the struggle. Essential industries were extended the help and support of society because society recognized its dependence on them. Much that was economically unsound and unfair was perpetrated under cover of this effort to uphold necessary industrial factors. But the lesson was useful and justifies inquiry as to whether, properly adapted to peace conditions, the methods of larger integration and REPORT OP THE NATIONAL AGBICULTUBAl, CONFEEEITCE. 9 wider cooperation might not well be projected into times of peace. The need of better financial facilities for the farmer must be ap- parent on the most casual consideration of the profound divergence between methods of financing agriculture and other industries. The farmer who owns his farm is capitalist, executive, and laborer all in one. As capitalist he earns the smaller return on his investment. As executive he is little paid, and as laborer he is greatly underpaid in comparison to labor in other occupations. There is much misconception regarding the financial status of agriculture. If the mortgage indebtedness of farms shows over a given period a marked tendency to increase, the fact becomes occa- sion for concern. If during the same period the railroads or the great industries controlled by corporations find themselves able to increase their mortgage indebtedness by dint of bond issues, the fact is heralded as evidence of better business conditions and of capital's increased willingness to engage in these industries and thus insure larger production and better employment of labor. Both the mechanism of finance and the preconceptions of the community are united in creating the impression that easy access to ainple capital is a disadvantage to the farmer, and an evidence of his decay in prosperity, while precisely the same circumstances are construed in other industries as evidence of prosperity and of desirable business expansion. In the matter of what may be called fixed investment capital, the disadvantage of the farmer so strongly impressed public opinion that a few years ago the Federal Farm Loan Board was established to afford better supplies of capital for plant investment and to insure moderate interest rates. But while unquestionably farm finance has benefited, the board has thus far not extended its operations to the provision of working capital for the farmer as distinguished from permanent investment in the plant. There should be developed a thorough code of law and business procedure, with the proper ma- chinery of finance, through some agency, to insure that turnover capital shall be as generously supplied to the farmer and on as rea- sonable terms as to other industries. An industry, more vital than any other, in which nearly half the Nation's wealth is invested can be re- lied upon for good security and certain returns. In the aggregate, the capital indebtedness of the country's agri- cultural plant is small, not large. Compared with other industries, the wonder is that agriculture, thus deprived of easy access to both investment and accommodation capital, has prospered even so well. The lines on which financial support of agriculture may be or- ganized are suggested in the plan of the Federal Farm Loan Board, and in those rural finance societies which have been so effective in some European countries. The cooperative loaning associations of Europe have been effective incentives to united action by farmers, and have led them directly into cooperation in both production and marketing which have contributed greatly to the stabilization and prosperity of agriculture. Whether we examine the cooperative societies of Eussia, now recognized as the most potent support in that disturbed country for orderly society, or whether we turn to the great and illuminated cooperative associations which^have strength- ened the California agricultural industries ; whether we exainine the 10 REPOET OP THE NATIOKAL AGBrCTTLTTTRAIi CONFEEENCE. cooperative societies of Ireland and Denmark or the like organiza- tions which handle the potatoes of Maine, or the cantaloupes of Colo- rado; whether we consider these organizations as means to buying the farmer's requirements in a cheaper market or to selling his prod- ucts in a more remunerative one, the conclusion is in all cases the same. It is, that the farmer is as good a business man as any other when he has the chance ; that he is capable of organization, coopera- tion, and coordination ; that he will apply souild methods to his busi- ness whenever he has the chance ; that his credit can be better estab- lished, his particular needs of capital on terms suited to his require- ments can be met; that, these things accomplished, he ceases to be an underpaid laborer, an unpaid executive, and a capitalist with an unremunerative investment. It can not be too strongly urged that the f artner must be ready to help himself. This conference would do most lasting good if it would find ways to impress the great mass of farmers to avail themselves of the best methods. By this I mean that, in the last analysis, legis- lation can do little more than give the farmer the chance to organize and help himself. Take cooperative marketing. American farmers are asking for, and it should be possible to afford them, ample provision of law under which they may carry on in cooperative fashion those business operations which lend themselves to that method, and which, thus handled, would bring advantage to both the farmer and his consum- ing public. In countries where these facilities and opportunities have been afforded such cooperative organizations have been carried to the highest usefulness and are recognized as aiding both farmer and consumer. They make the farmer's selling price higher and the consumer's buying price lower. But when we shall have done this, the farmers must become re- sponsible for doing the rest. They must learn organization and the practical procedures' of cooperation. These things we can not do for them, but we can and should give them the chance to do them for themselves. It will be for them to demonstrate their readiness and willingness and ability to utilize such instrumentalities. There is need for wide dissemination of information and understanding of methods, and for development of what I may call the spirit and purpose of cooperation. The various excellent societies of farmers which are represented here have a large responsibility in this regard. They have already done much, but they have much more to do if the American farmer shall be brought most effectively to help him- self through organization and cooperation. One of the most serious obstacles to a proper balancing of agricul- tural production lies in the lack of essential information. All too frequently such information' is gathered by private interests whose concern is private -profit rather than the general good. Agriculture can not thrive under conditions which permit the speculator, the broker, the forestaller, because of superior information, to become chief beneficiaries. The element of speculation in crop production is at best so great as to dictate that other speculative elements, always liable to be manipulated to the disadvantage of the producer, shall be reduced to the minimum. With proper financial support for agriculture, and with instru- mentalities for the collection and dissemination of useful in forma- BEPOBT OF THE NATIONAl, AGEICUL,TTJBAL CONFEKENCE. 11 tion, a group of cooperative marketing organizations would be able to advise their members as to the probable demand for staples, and to propose measures for proper limitation of acreages in particular crops. The certainty that such scientific distribution of production was to be observed would strengthen the credit of agriculture and increase the security on which financial advances could be made to it. The disastrous effects which arise from overproduction are notori- ous. The congressional joint committee on agricultural conditions in the valuable report which it has recently issued, declares that a deficiency of one-tenth in the production of a particular staple means an increase of three-tenths in the price ; while a deficit of two-tenths in production will mean an increase of eight-tenths in the price. The converse of this is just as emphatically true. In a recent address to the Congress, I stated thip situation thus : It Is rather shocking to be told, and to have the statement strongly supported, that 9,000,000 bales of cotton, raised on American plantations In a given year, will actually be worth more to the producers than 13,000,000 would have been. Equally shocking is the statement that 700,000,000 bushels of wheat, raised by American farmers, would bring them more money than a billion bushels. Yet these are not exaggerated statements. In a world where there are tens of millions who need food and clothing which they can not get, such a condition is sure to indict the social system which makes it possible. It is apparent that the interest of the consumer, quite equally with that of the producer, demands measures to prevent these violent fluctuations which result from unorganized and haphazard pro- duction. Indeed, the statistics o,f this entire subject clearly demon- strate that the consumer's concern for better stabilized conditions is quite equal to that of the producer. The farmer does not demand special consideration to the disadvantage of any other class ; he asks only for that consideration which shall place his vital industry on a parity of opportunity with others and enable it to serve the broadest interest. _ ... No country is so dependent upon railroad transportation as is the United States. The irregular coast lines of Europe, its numerous indenting arms of the sea as well as its great river system, afford that continent exceptional water transportation. The vast conti- nental area of the United 'States is quite differently situated, its greater dependence upon railroad transportation being attested by its possession of nearly one-half the railroad mileage of the world; and even this is not adequate. The inevitable expansion of population will enormously increase the burden upon our transportation facili- ties, and proper forethought must dictate the present adoption of wise and f arseeing policies in dealing with transportation. If broad-visioned statesmanship shall establish fundamentally sound policies toward transportation, the present crisis will one day be regarded as a piece of good fortune to the Nation. To this time railroad construction, financing, and operation have been unscientific and devoid of proper consideration for the wider concerns of the community. To say this is simply to aflmit a fact which applies to practically every railroad system in the world. It is as true regard- ing the railroads of Canada and Great Britain as it is in reference to those of the United States. It is equally applicable to the rail- ways of continental Europe, in whose development considerations of political and military availability have too far overweighed eco- 12 REPOKT OF THE NATIOITAL AGBICULTTJEAl, CONFERENCE. nomic usefulness. In America we have too long neglected our water- ways. We need a practical development of water resources for both transportation and power. A large share of railway tonnage is coal for railroad fuel. The experience of railway electrification demon- strates the possibility of reducing this waste and increasing efficiency. We may well begin very soon to consider plans to electrify our rail- roads. If such a suggestion seems to involve inordinate demands upon our financial and industrial power, it may be replied that three generations ago the suggestion of building 260,000 miles of railways m this country would have been scouted as a financial and industrial impossibility. Waterway improvement represents not only the possi- bility of expanding our transportation system, but also of producing hydroelectric power for its operation and for the activities of widely diffused industry. I have spoken of the advantage which Europe enjoys because of its easy access to the sea, the cheapest and surest transportation facility. In our own country is presented one of the world's most attractive opportunities for extension of the seaways many hundred miles inland. The heart of the continent, with its vast resources in both agriculture and industry, would be brought in communication with all the ocean routes by the execution of the St. Lawrence water- way project. To enable ocean-going vessels to have access to all the ports of the Great Lakes would have a most stimulating effect upon the industrial life of the continent's interior. The feasibility of the project is unquestioned, and its cost, compared with some other great engineering works, would be small. Disorganized and prostrate, the nations of central Europe are even now setting their hands to the development of a great continental waterway, which, connecting the Rhine and Danube, will bring water transportation from the Black to the North Sea, from Mediterranean to Baltic. If nationalist prejudices and economic difficulties can be overcome by Europe, they certainly should not be formidable obstacles to an achievement, less expensive, and giving promise of yet greater ad- vantages to the peoples of North America. Not only would the cost of transportation be greatly reduced, but a vast population would be brought overnight in immediate touch with the markets of the entire world. This conference needs have no fear of unfortunate effects from the fullest development of national resources. A narrow view might dictate, in the present agricultural stress, antagonism to projects of reclamation, rehabilitation, and extension of me agricultural area. To the contrary, if agriculture is to hold its high place, there must be the most liberal policy in extending its opportunity. The war, as was recently well said by the Secretary of Agriculture, has brought our country more quickly, but not more inevitably, to the necessity of deciding whether this shall be. predominantly an industrial coun- try, or one in which industry and agriculture shall be encouraged to prosper side by side, and to complement each other in building here a community of diverse intereste. If our policy shall be, as it ought, to encourage the dual development, then we have need to con- sider the early and continuing reclamation of those great areas which with proper treatment would become valuable additions to our agri- cultural capacity. To this end every practical proposal for watering REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. 13 our arid and semiarid land, for reclaiming cut-over forest areas, for prbtectine fertile valleys from inundations, and for draining the potentially rich and widely extended swamp areas, should be given the full encouragement of the Goverimient. All this should be a part of recognized permanent policy. Not otherwise will it be possible to keep the Nation self-supporting and as nearly self-contained as it has been in the past. There must be a new conception of the farmer's place in our social and economic scheme. The time is long past when we may think of farming as an occupation fitting for the man who is not equipped for or nas somehow failed at some other line of endeavor. The successful farmer of to-day, far from being an untrained laborer working every day and every hour that sun and weather permit, is required to be the most expert and particularly the most versatile of artisans, executives, and business men. He must be a good deal of an engineer, to deal with problems of drainage, road building, and the like. He requires the practical knowledge of an all-round me- chanic to handle his machinery and get best results from it. The problems of stock-raising and breeding demand understanding of biolo^, while those of plant-raising and breeding call for a wide practical knowledge of botany and plant pathology. In handling his soils for best results, in using fertilizers, determin- ing rotations, and in selecting and using feeds for stock, he has need for a working knowledge of chemistry. As our timber supply is reduced, his service in conserving and expanding the timber resources of the farm will be increasingly important, necessitating an intimacy with forestry and forestation. There is no business in which the executive talents of the skilled organizer and manager are more absolutely necessary than in successful farming; and this applies alike to the producing, the buying, and the selling phases of farming. Along with all this, the farmer must have untiring energy and a real love and enthusiasm for his splendid profession. For such I choose to call the vocation of the farmer — ^the most useful, and, it ought to be made, one of the most attractive among all lines of human effort. THE PUBPOSE OF THE CONFERENCE. By Henry Wallace, Secretary of Agriculture. To the appreciation of the President, let me add my own. It is a wonderful response to an invitation to come, work for nothing, and board yourself. May I add, however, that knowing that many of you have been accustomed in recent times to do that sort of thing, per- haps I am not surprised as some others might be. In his letter asking me to call this conference, and in his address which you have just heard, the President has made plain the purpose for which you have been asked to come here. The agriculture of the Nation is in a bad state, and our entire business and industrial life is suffering in consequence. High production costs, followed by ridiculously low prices, have greatly reduced the farmers' net income, and his purchasing power has been still further reduced by the dis- proportionately high prices of the things he is forced to buy. The 14 REPORT OF THE NATIONAL AGRICXILTURAL CONFERENCE. conditions in different sections of the country will be presented this afternoon by men chosen from your own number. Never before has there been brought together a group of men who so completely represent the agricultural life of the Nation. You come from every State ; you represent every phase of agricultural produc- tion. As individuals you have been successful. Many of jou have been chosen because you are officers in farmers' organizations, and thus are known to have the confidence of the members of those organi- zations. To those of you who come from the farms and ranches have been added representatives from the various agricultural institu- tions and agencies and also representatives from the related indus- tries. You have been chosen solely for your known ability to serve at this time. When in war we called our boys and men to put on the uniform, we made no inquiry as to their religion or anything else other than their ability to serve. So, in choosing the men to be asked to come here, we have taken no thought of your politics, religion, or anything else other than your known ability to serve in this case and the known wisdom of the counsel which you may bring. As has been suggested hj the President, your problem divides itself naturally into two parts : First, the present emergency and how best to break it ; second, the consideration of future policies with a view to building here a permanent sustaining agriculture such as the Presi- dent had in mind in what he just said to you. To all who have given it thought, it is evident that constructive effort must center in three fields: First, what may be done properly through legislative action; second, what may be done through administrative and educational effort. National and State, by the various agencies charged with the duty of fostering agriculture ; thirdly, what may and should be done by the farmers- themselves either individually or through their organi- zations. ' It is not my purpose to tell you what you should do here : but, realiz- ing that you have come at our invitation and at considerable incon- venience to yourselves, and that 3'6ur time is precious and must be conserved, we have on our own motion undertaken to set up a pre- liminary organization for your use. Naturally, in a gathering of this kind, composed as it is of strong, independent thinkers, progress must be made through committee action ; and we have assumed here, therefore, to set up a system of committees -to deal with the various questions which automatically present themselves in any conference called to consider agricultural matters. We have to the best of our abilityj and with the best knowledge we could get of your respective activities, experiences, and desires, assigned the various members to the various committees which have been set up, and the member- ship of those committees will be furnished you, I hope, early in the afternoon. Each committee has been provided with a committee room, mostly in this building. Arrangements have also been made for each com- mittee to have the stenographic help it may need. In addition, vari- ous men have been made available for your use. These men know the various sources of information which you may wish to gather and tjheir sole purpose and sole business will be to be at your caU to do what you would like to have them do. KEPOKT OF THE NATIONAL AGEICULTUEAL CONFERENCE. 15 The program, as you have no doubt noted,, has been arranged with the general view to-day of presenting to you the state of agriculture in the various sections of the country, and, as I have said, by men chosen from the delegate grbup. That will require the entire day. We have felt that necessary in order that we may have the whole thing laid out before us. This evening the President and Mrs. Harding will receive all of the delegates at the White House. Those of you who have already registered, no doubt, have received your ipvitations. Some, no doubt, have come in too late to register, but invitations will be delivered to all accredited delegates to the conference. Necessarily, attendance at such functions at the White House must be checked carefully. You will, therefore, take your invitation with you to be presented at the gate, but to be retained by you afterwards. While the invitations are addressed only to the delegates themselves, it is understood that wives are also invited. Perhaps some of you, not anticipating a reception of that kind, have come without your dress suit. Don't let that worry you — come with the best you have. People are received at the White House for what they are and not for how th&jr are dressed. To facilitate the work of the conference and to dispose of the many questions which will come up naturally in a meeting of this sort. Dr. H. C. Taylor will be executive secretary and will be avail- able for consultation at all times. Last summer Congress appointed a joint commission composed of representatives from the House and from the Senate, called the Joint Commission of Agricultural Inquiry. That commission has been at work for eight months. It has made the most exhaustive inquiry into agricultural conditions that, I think, has ever been made in this country. Portions of its report have already been released. Others will he released soon. The chairman of that committee, a gentleman who has been untir- ing in its work. Representative Sydney Anderson, representative from Minnesota, I have asked to act as the permanent chairman of this conference, and I have asked him to address you. AGEICTJLTURAL PRICES AND THE PRESENT SITUATION. By Representative Sydney Anderson, chairman of the Joint Congressional Commission of Agricultural Inquiry. I should be very insensible, indeed, to the signal honor which has been done me by the Secretary of Agriculture in selecting me to preside over this great conference if I did not feel grateful to him for his action. I shall endeavor to merit the confidence which he has expressed in this action by presiding with impartiality, re- membering that the conditions which you are here to consider are urgent as well as important and that it is necessary that we should act with speed as well as efficiency and that it is the desire of the Secretary and of the President that we should, if possible^ secure re- sults from the conference. As the Secretary has indicated, the Congress in June, 1920, created by a joint resolution the Joint Commission of Agricultural 92640— H. Doc. 195, 67-2 2 16 REPORT OF THE NATIONAL AGRICTTLnXRAIi CONFERENCE. Inquiry, of which I had the honor to be chairman. I understand that my function this morning jparticularly is to give you a report in brief of the conditions which the commission has uncovered in the course of its investigation, as a basis, somewhat at least, for the deliberations which you are soon to undertake. Business cycles, such as that through which we have been pass- ing, are not new. They have occurred at more or less regular in- tervals in all of the highly organized niodern countries of the world. The phenomena incident to these cycles are more or less well under- stood, but their causes are rather obscure and difficult to determine. The cycle begins at the end of a period of depression, when sur- plus stocks of goods have bieen worked oflf. They begin at a time when shelf stocks are generally reiuced, when demand begins to overtake supply. Money is easy and interest rates are down. Prices, particularly for raw materials, are low. At this period busi- ness begins to slowly revive. More goods are consumed. More peo- ple are employed. As business expands, unemployment decreases. As prices rise, a fever of speculation sets in, and as this fever runs its course, bank runs expand to meet the expansion of business. People spend freely, extravagantly, and finally beyond their cur- rent income. Paper profits are large. The shortage of goods, or apparent shortage of goods, develops a seller's market. Industrial plants are expanded to meet this supposed demand. All economic and psychological factors combine to produce a pe- riod of business and industrial prosperity which we enjoyed; — or, perhaps, I ought not to say enjoyed — during the period following the war. A great volume of debts is made for the extension of plants for the production and consumption of materials. These debts tend to accumulate faster than current savings or ability to pay. As interest and debts current do overtake and pass the ac- cumulation of savings, a curious reversal of direction occurs with the economic and psychological factors which originally combined to produce prosperity. Banks, having exhausted their reserve, begin to stop lending and call the loans. Circulation is rapidly diminished, and we come to the period of stress. Business cycles of alternating prosperity and depression, such as that through which we have been passingj are not new. They have occurred at more or less regular intervals m all of the highly organ- ized nations of the world. The cycle begins at the end of a period of depression, when confidence begins slowly- to return, when sur- plus stocks of goods have been worked off and shelf stocks are gen- erally reduced, when demand begins to overtake supply, when money is easy, interest rates are down, and prices, especially for raw mate- rials, are low. At this period business begins to revive, more and more people are employed and more and more goods are consumed, business expands at an increasing rate, unemployment disappears, and wages increase. As prices rise, a fever of speculation sets in and there develops a veritable scramble for goods, stocks, and prop- erties. Paper profits are large; people spend freely and extrava- gantly, and finally beyond their current incomes. Orders for pres- ent and future delivery of goods pile up, and an apparent shortage develops a seller's market. Industrial plants are extended to meet KEPOET OF THE NATIONAL AGRICULTURAL. CONFERENCE. 17 this supposed rise, and bank loans and currency issues expand to meet the expansion of business. All the economic and psychological factors conspire to produce an era of intense business activity and prosperity. In these periods of great activity and prosperity a heavy volume of debts is made for plant extension, for production, and consump- tion. These debts accumulate faster than savings and tend to pro- duce an exhaustion of capital and credit. As interest and debts currently due overtake and pass the ability of people to pay with current savings or credit, a curious reversal of direction occurs in the economic and psychological forces and phenomena which com- bine to produce prosperity. Bankers, whose iexpanding loans have depleted their reserves, are forced to stop further lending and then to call their loans; banks of issue raise discount rates; speculation rapidly diminishes; manufacturers and merchants begin to place surplus stocks on the markets; prices begin to fall; consumers cur- tail purchases and spending in anticipation of still lower prices; those who in the period of prosperity bought to make a profit from rising prices, now sell to avoid further losses from continuing price declines; orders for goods are canceled, and it becomes apparent that the orders representing demand were more or less of fictitious proportions; more and more goods are put on the market, while demand grows less and less; building slows down; debts are liq- uidated as far as possible from current receipts; production falls off in consequence of the lowered demands ; unemployment increases ; prices continue to fall, and the decline is usually more rapid than the rise. This process continues until some proportion of the debts made in prosperity are liquidated and until stocks are reduced to a point where such demand as exists even in times of unemployment over- takes supply, prices and interest rates are down, wages are low, money is easy, and the beginning of a new era of prosperity is at hand. All of this we have seen in this country and in many others in a highly condensed and most spectacular form in the last two and a half years. Rarely has a cycle swept through all its familiar features more swiftly and dramatically than that which followed the close of the Great War. The most distant nations were equally involved, and most of them followed through the successive phases in almost identical times. Far-distant Java and Japan were affected in much the same way and at much the same time as the United States, Canada, and Great Britain. In the United States every industry and every class of people were involved in the avalanche of descending prices. The turn in the tide from optimism, expansion, speculation, and extravagance to the reac- tion of deflation and depression occurred about the middle of 1920, when the grain crop of the United States was beginning to go on the market. This fact, coupled with limitations of credit and high interest rates, resulting from depleted reserves and exhaustion of credit and the failing export demand, which followed upon the exhaustion of European credits in this country and failing purchasing power of European peoples, were largely responsible for the earlier and more 18 REPORT OF THE NATIONAL AGRICULTTniAIi CJONFEEBNCE. rapid decline in the prices of agricultural products compared with the prices of other groups of commodities. The enormous demands upon the credit of the Nation for war re- quirements had by the end of the war greatly reduced bank reserves, notwithstanding a very large increase in the gold base. These reserves were still further reduced by the demands incident to the most extra- ordinary period of inflation which followed the war. It was expected that with the removal, following the war, of restric- tions upon consumption, which were more or less in effect the world over, there would be an enormous demand for American goods and products of the farm. As long as the credit which had been granted to our allies remained unexpended and the people in this country had bonds which could be turned into cash with which to buy goods, this hope seemed to be realized. But with the exhaustion of the European credits in this country, the depletion of banking reserves and savings accumulated in Government paper in the hands of the people, export demand began to decline and consumption in the United States to diminish. Farmers who had produced in abundant measure at the behest of the Government continued to produce after the fictitious market created by the demands of war and the unexampled period of extravagance and indulgence which followed the war had disappeared. There was almost universal oversight of the fact that the market for goods is not measured by the desires or even the needs of pepples or of nations, but by their ability to pay with either goods or credit. The apparent need of a world which had been under rations deceived the farmer into the belief that the high market for agricultural prod- ucts> would continue. The crop to be sold had been produced at a cost which was the greatest in the history of the country. The farmer had used his credit freely in improving his land, in purchasing additional acres, in increasing his equipment, and in buying war bonds. He had accumulated no surplus out of which the losses in crop value could be paid. He could not curtail production to correspond with de- creased demand. Debts incurred must now be paid with products of greatly depreciated value. The pressure for liquidation came upon him at a time when the prices he could get for his prodjucts were wholly inadequate to liquidate the debts he had made in producing them. He was in many instances obliged to seek credit for future produc- tion at a time when the demand was for liquidation of loans rather than extension of further credit. All of these factors increased the farmer's difficulties and added to the hardships, sufferings, and losses inevitably incident to a period of price decline. They are the factors which combined to make the farmer's situation what it is to-day. I think there has never been a time when there was more public nflisunderstanding of what has been done and what it is possii)le to do to meet this situation than there is to-day. The conditions which we are trying to remedy are world-wide in character and they grow out of a long period of economic and political dislocations. The restoration of economic stability and of appropriate relations between the various industries such as will represent a fair division of the rewards of labor and investment EEPOEI OF THE NATIONAl, AGRICULTTTEAL CONFERENCE. 19 of capital between them is a matter which, with all the facilitation which governments can give it, will occupy a considerable period of time. It is possible to destroy the temple of industry or agriculture in a day, but it can not be rebuilt with equal speed. All of this means that, at best, the period of readjustment is not yet over and a good deal of sacrifice must still be made, and a good many hardships must still be borne, before we reach that state of continued economic sta- bility which the President of the United States has designated as " normalcy." Nevertheless, the Government is clearly obligated to facilitate the readjustments and to minimize the hardships incident to the period so far as it can do this by wise and sound measures. It was the recog- nition of this obligation which doubtless inspired the President of the United States in requesting the Secretary of Agriculture to call this conference together. The Congress has recognized this obligation by creating the Joint Commission of Agricultural Inquiry to investigate the agricultural situation and report upon remedial measures, and by passing measures of relief. The commission divided its investigation into four major sub- divisions : The agricultural crisis and its causes ; credit, particularly agricultural credit ; transportation ; marketing and distribution. The commission has already made a report upon the first and second major subdivisions of the investigation and it is in the process of gathering and compiling data for reports upon the last two of these divisions. The commission has not discovered any new economic principles; it has not discovered how men can live without working ; or, how to make sopiething out of nothing; it has discovered nothing new in human motives; it has concocted no new legislative panacea which will cure the ills of the world overnight. It has not sought to do so. It has rather sought to reduce the condition of agriculture to con- crete terms to determine the factors which caused this condition and to draw conclusions as to the measures of relief which might be applied to develop the basis of a sound and permanent program of agricultural development and to provide the information upon which effective and profitable relations might be established between agri- culture, industry, trade, and commerce. An understanding of the condition of agriculture is clearly a preliminary to an examination of the causes which brought about that condition, and a precedent to the determination of remedies for it. The condition of an industry, like the condition of an in- dividual, is not static ; it can not be stated in absolute terms ; it must be determined by a comparison with the condition at some previous period and in contrast with the condition of other industries. If the prices of all commodities and groups of commodities rose and fell together, the condition of the industry producing them, so far. as they are reflected by price relationships, would remain the same ; but prices of all comrSbdities do not always rise or fall in the same degree, or at the same time. The condition of an industry is, therefore, in part indicated by the relation which the prices re- ceived by that industry for its commodities bear to the prices re- ceived by another industry for its products. That is to say, the value 20 REPORT OF THE NATIONAL AGRICULTURAIj CONFERENCE. of the farmer's crop is measured by what farm 'crops will buy of other commodities, that is, by the purchasing power of the farmer s dollar. . ,, ,. ii.- As compared with 1913, the farmer's dollar m May of this year, in the terms of all commodities, was worth 63 cents; in 1920 it was worth 89 cents, which is less than it was worth in any preceding year, with two exceptions. The purchasing power of farm crops m May, 1920, ranged from 42 ppr cent to 117 per cent of 1913, with only chickens and buckwheat having a purchasing power higher than in 1913. -, j, ,-, ■ . Not only do prices of some commodities rise and fall m a greater degree than others, but the prices of some commodities rise and fall with greater rapidity than others, and the rapidity of the rise or fall is also a factor in determining the relative welfare of the producers of one group of commodities as compared with the pro- ducers of other groups of commodities. The prices of agricultural products rose very much at the same time as the prices of other commodities, perhaps a little earlier than the most, but, beginning in 1919, fell much more rapidly than the groups of other com- modities. This had the effect of intensifying and accentuating the disadvantage of the producers of agricultural products during the period of price decline. This irregularity of price inflation has the effect of taMi^ money from one group of producers and giving it to another. Deflation does the same thing, but deflation does not necessarily take the money from those awio profited most by deflation. In the rise and fall of prices the last six years, agriculture profited but slightly during the war period. These profits Were wholly swept away by the debacle of prices in 1920 and 1921. The progress of one industry as compared with another may be measured in part by its comparative quantity output — ^that is to say, it may be assumed that the prices received by an industry for its products tend to increase or decrease production in somewhat defi- nite proportion to the rise or fall of prices over a considerable period. It may also be assumed that the well-being of agriculture as well as its proper balance with other industries can be measured by the rela- tion of quantity production to the increase in population. Various indexes have been set up which measure the relative output of the industries as compared with each other and as compared with popula- tion. Quantity production of agricultural products has on the whole about kept pace with population ; the production of grains and pork has slightly more than kept pace with population, while the pro- duction of beef and lamb has fallen below the increase in popula- tion. The quantity production of agricultural products has lagged far behind the quantity production of mines and factories. It seems safe to conclude, therefore, that the prices received by producers of agricultural products have not been sufficient to induce an increase in quantity production comparable with the increase that has occurred in the production of either mines or factories. Perhaps the best test of the well-being of an industry is found in the comparison of the rewards for the capital invested and labor employed in other industries. The total value of the product of all industries in the United States, as shown by the studies of the National Bureau of Economic BEPORT OF THE NATIONAL AGKICULTUBALi CONFERENCE. 21 Research, has ranged from $28,000,000,000 in 1909 to $65,000,000,000 in 1919. Of this total value the net value of products originating in agriculture has represented from 16 to 22 per cent, with an average of abeut 18 per cent, although approximately 40 per cent of the population is directly dependent upon agriculture. In measuring the net return of the farmer from year to year for labor, risk, and management an allowance was made for interest on capital invested of 5 per cent in the years preceding 1919, 5^ per cent in 1919, and 6 per cent in 1920. After allowing this return upon the investment the farmer's average reward for labor, risk, and management in 1913 was $444; in 1914, $459; in 1915, $495; in 1916, $586; in 1917, $903; in_1918, $1,278; in 1919, $1,466; and in 1920, $465. In terms of prices of 1913, the average reward per farmer for labor, risk, and management was, iii 1913, $444; in 1914, $454; in 1915, $484; in 1916, $534; in 1917, $705; in 1918, $826; in 1919, $833; and in 1920, $219. In terms of purchasing power in 1920 the farmer received for his labor, risk, and management on the farm slightly less than one-half as much as he received in 1913. It must be remembered that the figures which I shall presently give represent the rewards to employees in other industries, not the rewards for investment or management. As previously stated the average reward to the farmer for labor, risk, and management in 1913 was $444. The yearly earnings of the employees in the mining industry were $755; of factory employees, $705; of railway em- ployees, $782 ; of banking employees, $930 ; and of Government em- ployees, $823. In 1918, the average reward per farmer for labor, risk, and management was $1,278 ; per mining employee, $1,280 ; per factory employee, $1,147; per railway transportation employee, $1,394; per banking employee, $1,461; and per Government em- ployee, $895. Obviously, during the period from 1913 to 1918 the reward of the farmer increased relatively as compared .with the re- wards of those employed in other industries, although less in 1918 than in any of the other groups of employees mentioned save those engaged in factories. We do not have figures for 1919, 1920, and 1921 for persons en- gaged in industries other than agriculture, but it is probable that on the whole, expressed in terms of purchasing power, rewards of the persons engaged in other industries have slightly increased in 1921 over 1918, while the rewards of those engaged in agriculture have decreased 73 per cent. Prices of agricultural products have at no time in the last 20 years returned the farmer a profit upon investment plus a reward for labor, risk, and management equal to the average wages received by the persons employed in other industries. The effect of this out-of-line condition between the prices of agri- cultural products and other commodities, as well as the influence of freight rates in determining the net prices received by the farmer for his products, is indicated by a study recently made by the com- mission. This study was directed toward determining the relation- ship between the prices, of commodities which the farmer has to buy, the cost of transportation, and the prices of the commodities the farmer has to sell. Incidentally it also shows the total amount of freight involved in the transaction of buying a given set of farm implements with either wheat or corn. 22 BBPOET OF THE NATION Al, AGRICULTURAL C0NFEEENCB, This is after all the real test, because the price of one commodity must in the last analysis be paid with another commodity. In mak- ing this study the commission took four typical farm implements — a wagon, a corn binder, a grain harvester, and a gang plow, ^t de- termined, first, the actual amount of transportation cost involved in the assembling of the raw materials; second, the amount of trans- portation cost in transporting the machines from the point of manu- facture to specified destinations in the producing centers ; third, the prices of the implements, all freight included, at the point of des- tination; fourth, the number of bushels of wheat or corn required to purchase the implements at the point of destination; fifth, the freight on the wheat or corn from the point of destination to Chi- cago, the commission assuming that the farmer's net price for the corn or wheat would be the price at Chicago less the cost of trans- portation; and, sixth, the total freight cost involved in the transac- tion. All of this data was procured for each year from 1913 to 1921. For the purpose of this illustration I am assuming the pur- chase of these four typical farm implements with corn at Spring- field, 111., and Goodland, Kans. The cost of the implements at Springfield, 111., including freight, in 1913 was $441; in 1920, $8T4; and in 1921, $Y00. The amount of corn required to purchase these implements at Springfield in 1913 was 716 bushels; in 1920, 583 bushels; and in 1921, 2,027 bushels. The freight on the amount of corn required to purchase the implements from Springfield, 111., to Chicago in 1913 was $32 ; in 1920, $53 ; and in 1921, $187. The total freight in the transaction, including freight on raw ipaterial, freight on implements from, point of manufacture to destination, and freight on the corn from Springfield to Chicago in 1913 was $71.60 ; in 1920, $132.26; and in 1921, $265.26. The cost of these implements at Goodland, Kans., including freight, was in 1913," $490.50, in 1920, $944, and in 1921, $761. The amount of corn required to purchase the implements at Goodland, Kans., in 1913 was 928 bushels; in 1920, 706 bushels; and in 1921, 4,142 bushels. The freight on the quantity of corn required to purchase the imple- ments from Goodland, Kans., to Chicago in 1913 was $122.16; in 1920, $179.30 ; and in 1921, $1,051.41. The total freight involved in the. transaction, including, as before, all of the elements of freight involved, was in 1913, $195.17 ; in 1920, $315.09 ; and in 1921, $1,186.63. The effect of a decrease in the cost of transportation is indicated by the following statement : Between October 15, 1921,- and January 3, 1922, the freight rate from Goodland, Kans., to Chicago on corn decreased from 25f cents to 19 cents per fcushel. This decrease in the cost of transportation was' reflected in an increase in the price of corn at Goodland, Kans. The effect of this increase in the price of corn was to reduce the number of bushels required to purchase these four farm implements from 4,142 bushels to 3,036 bushels. The effect upon the total freight cost of moving the corn required to buy the implements is shown by the fact that the freight cost dropped from $1,051.41 to $587.05. I should say that the purpose of this illustration is not primarily to show that freight rates are too high, but to show the effect of freight rates upon the condition of the farmer when the price of the farmer's product is out of line with the price ef transportation. It REPOET OF THE NATIONAL, AGEICXJLTUEAL, CONFEEENCB. 23 is, I thinJj, generally conceded that at present prices of farm products existing freight rates upon such products constitute an excessive burden upon the agriculture of the country. It is equally clear that a full measure of relief to the farmer in the situation can not possibly come through a reduction in freight rates. There must be an increase in the price of the farmer's product entirely independent of a reduc- tion in freight rates if the purchasing power of the farmer is to be restored to anything approaching the prewar level. As an illustration of what I have just said, I desire to call your attention to some facts which the investigation of the joint commis- sion has recently developed. The commission has attempted to get the spread between producers' and consumers' prices upon a number of farm commodities and to separate the elements in the spread into their constituent parts with a view to determining just where the spread has occurred. We find as the result of inquiries, for example, that the average grower's price for hay at Bonair, Iowa, in 1916 was $11.65 and m 1920 and 1921, was $13.54. The terminal price' in 1916 was $18.29 and in 1920-21, $27.75. In other words, the spread between the pro- ducer's price and the wholesale price at the terminal increased from $6.64 in 1916 to $14.21 in 1920-21. The spread from the producer's price in 1915-16 to the wholesale price in 1920-21 amounts to $9.46 of which the grower got $1.89 ; the railroads, $2.50 ; while increased handling charges repesented $5.07. The spread between the pro- ducer's price and the terminal price in 1920-21 was divided $6.10 for freight and $8.11 for terminal and handling charges. In the case of apples from Wenatchee to Minneapolis, we find that the average grower's price in 1915^16 was $1.04 and the average retail price was $3.16. In 1920-21 the average grower's price was $1.73 and the average retail price was $6.15. This represents an increase from the producer's price of 1915-16 to the retail price of 1920-21 to $2.99, of which 69 cents went to the grower, 29 cents to the railroads, 62 cents to the jobber, 35 cents to the wholesaler, and $1.04 to the re- tailer. While the increase in transportation costs, as shown by these examples which are based upon a large number of average ship- ments, is great, it is clear that handling charges have increased in rather larger proportion than freight rates and that reduction in these handling charges are just as much necessary either to an in- crease in the producer's prices or a decrease in the consumer's prices as a reduction in freight rates. The readjustment, either of prices or of freight rates, does not readily lend itself to legislative action. The first must be brought about by economic measures; the second, by such administrative action on the part of the public authorities controlling transportation and the management of the railroads as will bring the elements of cost included m transportation rates into proper relation with com- modity prices. The farmer's interest in his product does not end with its sale at the local market, or even at the terminal. The price of his product is usually the price the consumer can be induced to pay less all the intervening costs of manufacture and distribution. These costs and profits of manufacture and distribution are usually figured on 24 REPORT OF THE NATIONAL AGEICTJLTUBAIj CONFERENCE. the final sale dollar. They, therefore, have a tendency to rise in pro- portion to the increase of commodity prices. They do not come down in the same degree or at the same rate as producer's prices in periods of price declines. The result is to compel the farmer to make more than his share of price reductions and to minimize his advantage from price in- creases. In much the same way, even in normal times, the farmer feels the effect of the wide fluctuation of the prices of agricultural products which industry and trade find a means to resist or mmi- mize. Again industry, with more or less efficiency, depending in large measure upon the degree to which it is organized, is able to control output and to relate it to effective demand. This the farmer has never been able to do. His output is largely determined by hazards of weather, plant and animal diseases, and insect pests which at best can only be minimized or partially controlled. An examination of the course of commodity prices during the recent crisis shows that prices declined least and declined least rapidly in the commodities controlled by highly organized industries. This indicates that these industries by curtailing production, changing production methods, or transferring production from one article to another were able to interpose an effective resistance to price declines. There is a good illustration of this ability to resist price decline by organization and control of output in the dairy industry. This in- dustry was probably better organized than any other agricultural industry, and because it was better organized it was able in some de- gree to control production and to interpose greater resistance to the decline of price of its products than any other part of agriculture, and its products therefore declined less in price. The restoration of conditions of normal operation and prosperity of the farmer of the country is dependent, first, upon the completion of the cycle of readjustment of commodity prices and of costs and profits of manufacture and distribution, and, second, upon the establishment of a means of stabilizing agricultural prices upon a profitable level. When I consider the desperate character of the situation, I could wish that there was some means of bringing about this condition by governmental actioUj but I am sure there is no governmental panacea, that there is no magic word of legislation and no magic wand of ad- ministrative action that can bring about these results. I am persuaded that they can be only accomplished through a more efficient organiza- tion of the producers. The farmer is essentially an individualist ; he sells his product in small quantities, interposing his individual selling power against the organized buying power of industry. He will continue to be the main sufferer from price fluctuations so long as he continues to do so. The merchant in selling his goods not only offers them at a price but offers with them a varying degree of service which includes credit, quality, dependability, convenience, delivery, environment, and all of the other elements for which the consumer pays. Upon the cost of all of these elements the merchant expects to make a profit. The farmer, on the other hand, sells his product very much in job lots as it comes from the farm without much regard to his customers' requirements in REPORT OF THE NATIONAL, AGBICULTUEAL CONFERENCE. 25 the matter of credit, equality, dependability, convenience, delivery, or other elements of service. As a result there have grown up along the lines of distribution a long chain of people performing all of these services for which the farmer pays in a reduced price for his product. The individual farmer can not well make the initial outlay required for the machinery and organization necessary for the performance of these services. Many of them could be performed by organizations controlled by farmers which would at the same time combine the farmers' selling capacity in such a way as to increase their bargaining power and influence. The method of selling farm products m indi- vidual job lots increases the opportunity for speculation and for the addition of unnecessary charges for storage, transportation, and handling. It is possible by organizations for farmers to standardize the qual- ity of the product of many farmers within a given locality, and by such standardization to increase the price per unit for the entire crop. I admit that the formation of farm organizations ideally qualified in the respects I have indicated is difficult. I know that it can not be done in a day or a year, but I am convinced that farm organization of a sound, wise, and farseeing character is the key to a more pros- perous and better paid agricultural industry. It is a matter of not more than 20 or 30 years since the manufacturing industry of the United States was only less organized than the farmer is to-day. Neither the manufacturing nor the distributive industries of the country are thoroughly organized even now. They do not know as much about each other, or even about themselves, as most of us think they do, but they are better organized than the farmers and their ad- vantage in this respect is frequently the farmer's disadvantage. I believe that advancement in farm organization, if not a prelimi- nary to at least must go hand in hand with improvements in the dis- tributive machinery of the country. This machinery has gradually adapted itself to unorganized methods of selling farm products which the farmer's status as an individual seller necessitated. The result of this adaptation of the distributive machinery to the farmer's unorganized condition has been to make the distributive process costly and to impose a large measure of this cost upon the producer. There are many other arguments which point directly to the pro- motion of farm organization as a means of promoting a better paid agriculture. It is quite impossible for the individual farmer, how- ever much assistance the Government may give him in this direction, to keep himself fully informed in regard to prices and economic movements. It is impossible for him to regulate his sales in accordance with market demand. Evidence of this is found in the fact that more than 70 per cent of the wheat crop of the United States reaches the market before the 1st of January of the crop year. The farmer must delegate the power of selling his crop and of put- ting it in shape for market and of performing all of the services nec- essary to its delivery, in quality, quantity, time and place, to some organization which he controls. Let us be perfectly frank about this matter. The fact that the farmer operates in small units for the most part has not given him the same opportunity for the development of 26 REPORT OP THE NATIONAL AGRIGULTURAL CONFERENCE. the genius of organization which has been offered to those engaged in manufacturing and distribution. Again, in his efforts in the direction of organization he has been too often misled by unscrupulous promoters. He has too frequently OYerlooked the necessity of wise and experienced management in his enterprise. He has made many costly mistakes, but these mistakes and these errors of judgment do not prove that farm organization is impossible or that it is without merit. The Government must remove the obstacles which retard, if they do not prevent, combinations of farmers for the purposes of sorting, grading, and packing or processing their products. The States must give legal status to organization of this k;ind which will establish definitely their legal powers and obligations as well as the legal powers and liabilities of their members. Agriculture will riot only benefit by the farm organization but it will also benefit by better organization of the distributive processes generally. The Commission of Agricultural Inquiry has been making some studies of the effect of increased distribution costs upon prices received by the farmer. These studies are not complete, but I think that it is safe to say that practically all of these added costs find some reflection in the net price which the farmer receives. This is espe- cially true of those costs which occur prior to the delivery at con- centration points, where the products of one locality come into com- petition with the products of another. These costs include all of the intervening processes, services, and added material between the producer and the consumer, including sorting, grading, packing, bulking, inanufacturing, transportation, storage, insurance, interests, rent, delivery, profits, and many others. We know that these costs were slowly but steadily increasing prior to 1913, and we know that they have about doubled in the last eight years. We know that these costs take, about half of the consumer's dollar. We know, in addition, that by and large the producer re- ceives but a small percentage of the price which the consumer pays. In so far as these added costs are the result of the increased complexi- ties of living under modern conditions, I think we must recognize them to be with us permanently ; but in so far as they result from the lack of organization of distributive processes," or failure to relate output to market, of avoidable waste and deterioration, we know that their improvement will result in an increased proportion of the final price going to the producer. I think it is a truism that many discoveries of fundamental im- portance and niany economic and scientific formulas are dependent for their practical applicability upon the discovery of new means, methods, and machinery for their application. So the ideal of dis- tribution is dependent upon the discovery and the development of new machinery and methods. Improved grades of agricultural products, standard containers, more accurate and current crop and live-stock statistics, as well as a •better knowledge of the use of these grades, standards, and statistics, must precede the development of very, comprehensive improvement in the distributive machinery of the country. The depletion of the original timber resources in the United States makes imperatively necessary the establishment of a definite forestry REPORT or THE NATIONAL AGRICULTURAL CONFERENCE. 27 polioy. This policy must necessarily be a part of a definite policy relating to land utilization and conservation. It is apparent that the existing banking machinery of the country does not adequately serve the farmer's credit requirements. These requirements are for credit corresponding to his turnover. The maturity of paper representing loans for agricultural purposes should be such as to make possible the payment of the debt, when it becomes due, out of products of the farm. Considering the wide variations in the production seasons and the great variety of farm crops and products, it Seems that stich credit should have a matu-rity of from six months to three years. The Joint Commission of Agricultural Inquiry, following an inves- tigation of the subject, has made a recommendation with respect to meeting these requirements which I commend to the consideration of the conference. There is a great need for the formulation of a definite constructive and conscious program of agricultural development. It is not my purpose to enumerate the recommendations which may properly be a part of such a program, but such a program must apparently contemplate recommendations in addition to those I have already suggested for an adequate warehousing system, more fully adapted to the utilization of warehouse receipts for credit purposes; more adequate wholesale terminal facilities, particularly for handling per- ishables at primary markets, and a more thorough organization of the agencies and facilities of distribution of the large consuming centers of the country ; the development of better roads to local mar- kets, better facilities at termina-ls connecting rail, water, and motor transport systems, and more adequate facilities at shipping points with a view to reducing the cost of marketing and distribution ; the promotion of better book and record keeping of the cost production of farm products as a basis for the development of more efficient methods of farm management, and an .extended and coordinated pro- gram of practical and scientific investigation through State and National departments of agriculture, and agricultural colleges and universities, directed toward reducing the hazards of climate and weather conditions, and of plant and animal diseases and insect pests. The work which this conference is called to perform is both im- portant and urgent. Its recommendations will be awaited with ardent hope by all those who appreciate the urgency of measures to restore the purchasing power of the farmer and the necessity of a well-paid and contented agricultural population to a well-balanced and prosperous national life. AGBICUIiTURAL CONDITIONS IN THE NORTHEASTEBN STATES. By E. B. Cornwall, of Vermont. I want to say right here to those of you who are not actually farm- ing that the farmer is often misjudged. People often wonder why the farmer does not do certain things. When I have been away from the farm for a few days I have often thought of things that I ought to do which seemed easy, but when I 28 REPORT OF THE NATIONAL AGRICULTTIRAL CONrERENCB. got back into the daily grind, from 5 in the morning till late at night, I usually haven't done those things. The farmer must work long hours to make a living. His income is too small to enable him to have a stenographer or bookkeeper. When he comes in at night, after long, physical work outdoors, he is too sleepy to think or figure. Just keep this in mind m working out farm problems. It is one factor which has usually enabled the business man to outgeneral the farmer in public affairs. The northeastern farmer did not feel the present economic crisis as quickly as the westerner. In some sections the situation is already very serious ; in other sections it is just becoming serious. Agricul- ture in the Northeast will soon be in as critical condition as in the West if we do not get immediate relief. Poultry men have made a fair income during the past year. They suffered heavily during the period of high grain prices, but recently with cheaper grain and good prices for fresh eggs and fair prices for poultry, the market has enabled .the intelligent poultry men to succeed. JPrices are now breaking badly. I am a poultry man my- self, and I confess I agree with our poultry expert that the outlook is bad. In 1920 the fruit men in New Hampshire made a good profit, while the last half of the fruit crop in 1920 in Delaware was sold at ruinous prices. During 1921 the fruit men of the whole Northeast had a short crop and lost money. They are not very optimistic over the outlook for this year. In Maine the transportation problem is acute as to apples, and also as to potatoes. The Maine Central and Bangor & Aroostook Railroads have declined to grant the 10 per cent reduction in freight rates, which all other roads of the country have allowed on agricul- tural products. The 1920 potato crop in Maine was sold at ruinous prices. The 1921 crop is being sold at a price which hardly covers the cost of production and hence leaves nothing with which to take up the obligations of 1920, and were the banks' correspondents to call for settlements on the rediscounted paper it would spell ruin to the farmers whose notes they hold. Along the western edge of our Northeast States are some grain growers and beef-cattle men. They are in a serious condition. This gives you some idea of the diversity of our farming, and the impossibility of making a short, quick siimmary. Dairying is a great industry which is uniform through these States. The dairyman is beginning to feel the crisis. It is coming on swiftly and we wiU soon be in severe straits. Cost account figures, whenever obtainable show that tnilk was produced during 1921 at a loss. Let me give you an illustration from New Hampshire. It costs more to produce milk in New Hampshire than in Vermont, but less than in Maine, Connecticut, and Massachusetts. Cost accounts for April, 1920, to April, 1921, show a loss per hundredweight of milk of 62 cents, when, everything is figured that should be in any com- plete cost account. It is interesting to note that labor was figured at only 16 cents per hour. These cost accounts were kept in dairies which are better than the average. During the year 1921 the milk which was shipped into Boston was sold at a price below the cost of producing it and the cost of getting BJEPORT OF THE NATIONAIi AGBICULrURAL CONFERENCE. 29 it there. As far as I can check this up it is true of the other large eastern cities. On January 1, 1922, the weighted average cost of producing 1 quart of the fluid milk which was shipped to Boston was $0.0762. To this cost is added the can and freight cost of delivering 1 quart of milk to Boston — $0.0118 which gives the final cost of 1 quart of milk to Boston, $0,087. The sale price f. o. b. Boston was $0.07. On January 1 milk was being sold f. o. b. Boston for about If cents per quart less than it cost to produce it and transport it. The cost of grain is now going up, and the cost of milk and milk products dropping. The railroads have not included fluid milk in their 10 per cent reduction. FiUed milk and milk substitutes are being sold in large quantities. Money is already very tight on the farms. Where are we headed? Our section as a whole, like all others, is suffering from the high cost of transporta:tion. This matter is getting earnest consideration from all the interested groups and will be taken up in this con- ference. I wish to indorse the recent highway legislation, the retaining of administration in the Agricultural Department development along the line of farm-to-market roads. The problem of adequate high- ways in a rural State like Vermont is very acute, owing to the heavy truck and through touring-car traffic, and to the fact that there is no large concentration of wealth to provide funds. The Federal farm, loan system is beneficial to the farmer m every section. I could quote instances in which it is aiding deservmg and thrifty farmers to get a start through its loans, and also through making certain banks see the light. The question of rural credits and commodity financing is not so acute in the Northeast as in other sections, so it will be the duty of their representatives to dwell on it more than I do. However, there is great need for a system which shall not be too paternahstic, but which wiU insure an adequate supply of long-time credits suitable to agricultural purposes. ' . There is a great need, of course, for a broad-visioned forestry It is" a matter worth thinking about and working on— this equaliz- ing of production and consumption. One thing is certain, there is no reason moral or economic, why the farmer should produce more than the market demands. No other manufacturer does, nor is it expected of him. . , .^ x^. • Cooperative buying is a very important matter m our region. Developing of cooperative marketing is one of the most pressing measures of relief for producers and consumers in our northeast States. There is no danger of abusive farmers' monopolies. You can not control farmer production; as soon as you succeed in raising the Drice to the farmer, you will have a much larger production wljich will make a surplus and keep the prices down. This is happening to day in our northeast dairy States. There have been striking in- stances in California and other sections. We can not abrogate the law of supply and demand; neither do we want to. It will operate better under a cooperative marketing system. 30 REPORT OF THE NATIONAL AGRICULTTJRAL, CONFERENCE. Vitally connected with the cooperative marketing is the tariff. The farmers do not attempt to decide whether we as a Nation shall adopt a high tariff or a- low tariff policy; we simply ask for a pro- tective tariff proportionate to that of other industries. We have people who urge us to follow the methods and examples of our Puritan ancestors. Those people would picture the Puritans as conservatives. A few nights ago I heard the president of one of our eastern colleges. He pointed out that the Puritans, during a short period, beheaded a King of England, led a troubled life in Holland, whither some of them had migrated, sailed in small boats across an uncharted sea, fought the Indians, and set up a govern- inent of their own. These men were anything but conservatives; they were progressives. In their day they were called radicals. They thought clearly and they followed their ideals. We must realize that leadership is not "sitting on the lid." A leader will always be a little ahead of his time. I weiit to a boarding school in the Berkshires where we often canoed on a small rapid stream. The only way we could steer through the rapids was to pad- dle, keeping just ahead of the current. If we drifted 'with the cur- rent or failed to pick our way through the^best channel, we capsized. Where the water was roughest we had to think most quickly and clearly, and paddle hard. There was no turning back ; no place for the timid or the sluggard. THE AGBICULTUBAL SITTJATION IN THE COTTON BELT. By James W. Morton, of Georgia. When I received the invitation from Mr. Wallace to come to Wash- ington and tell something of the conditions that we were experienc- ing in the South and suggest some remedies, I telegraphed back that it was impossible. In the first place, I didn't have the money to buy the ticket up here, and in the second place we had meetings on in our agricultural college I was very much interested in. After second thought of the importance of this meeting and, it being the first time in the history of our country that the powers that be thought enough of the farmer back on the farm to invite him to come to Washington and to give an intimate account of the conditions back home, I felt it was impossible to refuse and so I am hete, although scared to death. The cotton crops of 1918 and 1919 brought into the South more money than any three previous crops, both made at a rather moderate cost, and sold for record prices, and gave to every farmer, big and little, black and white, more ready money than they had ever dreamed of having in their wildest flights of fancy. The natural consequence was a period of reckless spending and speculation. Ex- travagant habits were formed. A story that was told at the time illustrates the little value placed upon money. A negro walked into the Overland Agency at Americus, Ga., and asked to see a car. After finding one to suit him, he purchased same, paying cash for it. In about two hours the same negro reappeared and asked to see another car like the first, which being shown him, was bought and paid for. About this time the salesman, being a little curious to know about the KEPOET OF THE NATIONAL, AGRICULTURAL CONFERENCE. 31 other car, asked this question : " Sam, what have you done with the other car ? " " Well, boss," the negro replied, " I ain't never run a car before, and when I got about a mile from town she tuck a fool notion and wrap herself around a stump. I done promise my old 'oman a car and I don't want to disappoint her." Another story is told of a negro boy in my home town who had come in to see the circus parade. He went into a grocery store to purchase a package of goobers and handed the clerk a $10 bill. About that time some one yelled, " Yonder comes the parade." The negro broke for the door; the clerk called for him to wait for his change. The negro's reply was, " Dat's all right, boss ; just keep the change ; I ain^t got time to wait." These illustrations may be overdrawn, but this was about the frame of mind of the average farmer and laborer of the South at the beginning of 1920. They had acquired very extravagant habits. The 1920 crop of cotton was grown with the prices of fertilizer, labor, and in fact everything that entered into the making of a crop, from two to three hundred per cent above normal. This crop was sold for about one-third the cost of production. The 1921 crop was grown with cheap labor, but with very high- priced fertilizers. Owing to the boll-weevil damage and a 30 per cent reduction in acreage, the smallest crop (about 8,000,000 bales) in 25 years was the result. The carry over from 1920 (about 9,000,- 000 bales), together with the abnormal times, has prevented the present crop from bringing the cost of production, even if a full crop has been made. Most farmers of the progressive type bought high-price lands for a small cash payment, and now find themselves unable to even meet the interest payments. The merchants are unable to meet their obligations, owing to the inability of the farmer to pay them. The banks are very heavy borrowers from the Federal reserve and War Finance Corporation, and unless the farmers and merchants have some means of liquidat- ing their loans the banks will be unable to finance the crops of this year. There is a general feeling of unrest and uncertainty, together with one of despondence among piost of the Georgia farmers. The better class of negro renters and croppers are leaving the' farms as the boll weevil advances and going north and into the cities, leaving the more shiftless and ignorant with the farmers to become a burden upon the landowner. It doesn't matter whether the negro owes you one or one thousand dollars, he settles his debt by leaving, and the farmer who has stood for him has absolutely no recourse. There are counties in Georgia which two years ago made 25,000 bales of cotton and last year less than 100 bales. Now, Mr. Chairman, I have given you just a little of the gloomy side of conditions as they actually are in the Southeast. I want to say right here that we of the South are not without a precedent, for in 1865, when our fathers came back home and found everything swept away, labor, live stock, food, and I might add self-government, they did not sit down and cry, but threw their rusty canteens and 92640— H. Doc. 195, 67-2 H 32 REPORT OF THE NATIONAL AGRICULTURAL, CONFERENCE. old overcoats aside, rolled up their sleeves, and without aid from their conquerors went valiantly to work rebuilding their lost for- tunes. There is plenty of this same blood in the Southern manhood and womanhood of the present day, and with the proper cooperation of our National Government (which we believe we have) agriculture in the South will one day rise upon a firmer foundation and to. hitherto unheard of heights. There is one great danger, as I see it, in the present agricultural conditions, and it is this : The farmers of this country can not go on, much longer producing ctops and disposing of same for less than the- cost of production. As to suggested remedies: First, cheaper and better methods of transportation, which na- turally divides itself into three great classes — namely, railway,, water, and highways. At the beginning of the war our Government took the best blood, of our country and sent them overseas to fight at a wage of $30 per month. It also took over the railroads of the country and doubled the amount of labor to run them at a wage of from $100 to $300 per- month, of which the farmer is still called upon to pay 55 cents. There must be cheaper freight rates or the farmers' products will' rot upon the farms. As an illustration I wanted to buy five cars of hay in Michigan last spring for the farm bureau of my county. The price was $14 f. o. b. cars in Michigan, but the freiglit rate was $16 per ton ; therefore, we did without the hay. A man in east Tennessee wanted a car of velvet beans from south Georgia. The beans were cheap enough, viz, $12 per ton, but the freight rate was $12, which made no sale. The Great Lakes-St. Lawrence waterway will give the grain, farmers a cheaper outlet, and the farm-to-market highways will meet a long felt need in stimulating production. The next remedy I would suggest would be a system of long-time credits, to enable the producers of live stock as well as cotton andi grain to market their products in an orderly manner. Next, I would inaugurate a reliable system of crop reports for the cotton States, and pay the man at the head of this department an. adequate salary, in order that the most efficient man possible could; be secured, for it hurts to have the price of the cotton crop reduced. $100,000,000 by a report that was misleading. The Government should without further delay sign the Ford con- tract for Muscle Shoals, in order that southern agriculture, and I might add, American agriculture, would have within our own bor- ders the source of cheap fertilizers. As I stood last week on that great dam at Muscle Shoals and saw the hundreds of thousands of tons of water and potential power go- ing to waste, I thought of the thousands of southern homes within- a radius of P^O miles of that great plant who were doing without the conveniences of life ; who had no running water in their homes ; who had no lights but the tallow candle and the kerosene lamp. I thought what a different country we would have if we could only de- velop this wonderful power. Nobody in this audience who hasn't been there and seen the possibilities of this wonderful project can. comprehend or have the least idea of its potentialities. REPORT OF THE NATIONAL AGRICULTTJBAl, CONFEEENCB. 33 I might say right here that it is nothing but fair. This country cftn not go along much further without the man and the woman on the farm enjoying tlae same conveniences that the man and the woman in the city enjoy. In conclusion, Mr. Chairman, the greatest need in the South is for people to quit talking hard times and go to work, to cease looking to the Government to right all their financial difficulties, and to realize that the remedy lies within each individual farmer — a more general return to the faith and religion of our fathers and mothers and a more general application of the golden rule. . AGKICULTUEAL CONDITIONS IN THE CORN BELT. By A. Sykes, of Iowa. Speaking for the farmers and cattle feeders of the corn belt, I wish to say that to-day they are in worse condition financially than they have ever been in before. For 40 years I have been connected with farming and I have passed through many panics and depres- sions, but never have I seen the farmer's purchasing power reduced to its present level. To this conference I can truthfully state that I have never seen such a helpless condition prevailing among such a large percentage of our farmers in the great corn belt as during the past year. Our present hard condition, is not due to any failure to work. Year after year since the war broke out we have produced to the maximum. Our wives, mothers, and daughters have worked in the fields as never before. When the war came to an end and our sons left the Army and the Navy to again take up farming, thousands of them started out farm- ing for themselves, buying land, live stock, and machinery at the peak prices of 1919 and 1920. Thousands of hard-working tenants whose specialty had been the raising of crops and the feeding of live stock had saved up a few thousand dollars and had come to a time of life when it was customary to make a payment down on a home of their own. These frugal, industrious men, accustonied to neither war nor speculation, had no reason to believe that they were embarking on a peculiarly hazardous enterprise when they bought a farm of their own, with i>, small payment down. And now, scat- tered all over the corn belt, are thousands and thousands of these hard-working young farmers who are facing financial ruin. Some are embittered by their unhappy experience. Even middle-aged and old farmers who had accumulated a compe- tence before the war broke out have watched their assets melt away like ice on a summer day. In almost every community one may find stories of such men. They are broken financially and spiritually. They are looking anxiously for renewed hope. Why is it, they ask, that they now have to pay 400 bushels of corn for a wagon which they used to buy for 150 bushels ? Why must they pay 350 bushels of corn for a gang plow which formerly cost 125 bushels ? Or 150 bushels for a suit of clothes which formerly cost 50 bushels, or 33 bushels for the shoes that formerly cost 9 bushels ? 34 REPORT OF THE NATIONAL AGRICULTURAL, CONFERENCE. "The rank and file of the corn-belt farmers are fighting against heavy odds. They may have sold their grain a-nd live stock for less than half the cost of production. They niay have sold their own labor and the labor of their wives and children at less than 5 cents an hour. But they are still fighting on and they are thinking more seriously than ever before. Men who are working 10 to 15 hours a day and facing a situation of this sort day after day want results. From a greatly reduced in- come they are compelled to pay greatly increased prices for supplies and transportation. They become impatient under the necessity of paying railroad rates 50 per cent above prewar rates, coal prices 100 per cent above prewar prices, and other prices 50 to 150 per cent above prewar prices. They read in Government reports that persons engaged in other great industries continue to enjoy abnormally high compensation for their services. They want to know if this is neces- sary in view of the fact that the cost of food is a chief part of the cost of living, and they do know that food products, as delivered to the markets by the farmers, have fallen -in prices to near the prewar level and some important items are far lower. Farmers in the corn belt want to know why ham is sold at retail throughout the country at about six times the price per pound of live hogs in Chicago when the normal ratio is about 1 to 3^. They believe that a reduction of retail prices of ham and some other food products to properly correspond with the reductions of prices received by f armerfe would do much to stimulate consumption and reduce the sur- plus stocks and restore normal conditions. Agriculture is not alone in being depressed. Almost every kind of industry in the corn belt is affected. When farmers can not buy, all others suffer, and this is well illustrated in Iowa at the present time. - The feeling of the farmers and many others is shown by their attitude toward counter taxes. In many counties the farmers and others are asking the supervisors to make radical cuts in salaries — to spend less on schools and roads. They say these are fine, but if the people have less money they must cut down expenses. Steps should be taken immediately to assist farmers who are under obligation to make payments during the next few months. Unless relief is afforded many will be ruined. It should not be possible to take the farms and homes from honest, industrious, thrifty farmers who are practically sure to pay their way out if given a little more time. Nor is this desirable from any point of view. We must find a way to help these men. Some banks are doing all they can. Com- munities having such banks are to be congratulated, and these banks deserve commendation. Federal funds now are finding their way to the rural districts, but for some reason their benefits are not reach- ing large numbers who need such help. We can not study the present situation without realizing the need of farmers for longer-time loans than have prevailed in the past. The farmer's turnover is slow as compared with manufac- turing and business, and a financial system adapted to the latter does not fit the farmer's situation. Just now farmers would be benefited by the storage of a large quantity of corn. It should be stored on the farms where most of it will be used. In each of the last two years the corn crop has been about 300,000,000 bushels in excess of normal. Due to the stress of war the corn acreage was REPORT 0-F THE NATIONAL AGRICULTTTEAL CONFERENCE. 35 greatly increased. Several millions of acres of corn land should be planted to clover and alfalfa, and this would be done if some of the present corn surplus is stored for use next year. The land needs the leguminous crops, and in the long run will produce more and better food crops if allowed to recu'perate in this manner. Thus, in the long run, the public would profit if the farmers could finance reasonable storage operations. Corn-belt farmers know that agricultural products make a large part of our exports annually, and that, during the past year, food products exported have shown a great increase. Our Secretary of Agriculture wisely has undertaken to get information in the foreign markets that will enable us to hold those markets as far as de- sirable. Such a study means much for American farmers, and Secretary Wallace should be commended for getting it under way sa promptly and he should be given every encouragement by appro- priations or otherwise to extend the work as far as he deems nec- essary. We need to know the requirements of foreign markets and how well these requirements are being met by other exporting coun- tries, and then we need to perfect our processes of growing and manufacturing and marketing so that we may successfully com- pete in so far as certain products are concerned — those which we have in surplus for export. This is a challenge to our ability, and our country must not fail to meet it. It is the duty and the privilege of our Government to investigate the causes of the suffering among the farmers of the corn belt and throughout the whole country, and to take measures which will cut short the suffering as far as possible. The situation is most com- plex. It emphasizes the importance of more knowledge on the economics of agriculture. It involves abnormal relations between prices of farm products and other prices, the handling of an enor- mous surplus, the better adjustment of supply and demand, the re- lation between agricultural and other exports, the development of the most efficient production and marketing methods possible, the care of loans maturing at an early date, provision for longer-term agricultural loans, and above all a better understanding of agri- culture, its fundamental character in reference to our national wel- fare and its emergency needs at this time. AGRICULTURAL CONDITIONS IN THE SPRING-WHEAT AREA. By John H. Hagan, of North Dakota. This I regard as a great privilege to have the opportunity to give a short talk to this gathering on the subject of agriculture in the wheat regions of the Northwest. • Having been asked to talk on the agricultural situation in the wheat regions, I take it for granted that by the Northwest is meant the spring-wheat area, of which my State, North Dakota, produces much of me high-grade milling varieties. North Dakota is usually thought of as a wheat State, but it must be remembered that it is also a heavy producer of other grains than wheat, such as rye, oats, barley, and flax. Also of live stock and dairy products. I believe that it would go unchallenged if I were 36 REPORT OF THE NATIOTSTAL AGRICULTURAL CONFERENCTE. to say that civilization is facing the most seriousvproblems in history in the so-called adjustment period. It is battling to properly feed, shelter, and clothe the people, even in face of the fact that it is claimed the United States has a surplus. We find farmers facing bankruptcy, with an undercurrent of dissatisfaction and a breaking up their morale, caused largely by their buying power being im- paired. On the other hand, we find factories of the Nation closed, or running part time, consequently less labor being employed and the laboring men's purchasing power also impaired. The farms of the Nation emploj about 13,000,000 people, of which more than 6,000,000 is additional to himself and family. The farmer has more money invested in agriculture than all the manufacturing, mining, and railroads when the water is squeezed out of them and is the largest single purchaser on the market and the largest single employer of labor of any single industry. The laboring man and the farmer together, with their dependents, form a very large percentage of all purchasing power, and unless the pur- chasing power of those two classes is restored the result will reflect on business conditions, and we can not expect business to improve mate- rially until the purchasing power of the farmer is restored. Primarily, agriculture is the basic industry of the Nation. There- fore, it is well that we, as a Nation, see to it that agriculture's buying power is restored. In my opinion, it can be restored only by the farmer receiving cost of production plus a reasonable profit. The present system of distribution forms a long chain between pro- ducer and consumer ; that of necessity must be shortened and cheap- ened, and it seems as though the Federal Government must, of neces- sity, reach out its strong arm of protection to save the farmers, and other business industries must either extend credit so that farmers" cooperative enterprise may extend near to if not to the consumer. Otherwise the Government must take over the distribution of grain centers, stockyards, transportation, etc., or industry will die of stag- nation. During the war we had a United States Grain Corporation, formed primarily for the purpose of holding down the price of wheat. In the words of Mr. Hoover, " If there had not been a mimimum price placed on wheat of $2.20 for No. 1 iNorthern or its equivalent, at Chicago, wheat would probably have reached $6 a bushel." Now, if a grain corporation could hold the price of wheat down during the period of the war, which they claimed helped to make it possible to win the war and make the world safe for democracy, it was done at the sacrifice of the wheat market, and it could certainly restore the United States Grain Corporation, place on a minimum price to save the farmer and keep the price so that it will at least meet the cost of production. However, if it is restored, the farmer should have a representative on the board. Labor should also be represented, as labor is a heavy consumer of breadstufFs. It should at least be restored to the extent that it could handle the surplus wheat used for export, and it would necessitate the Govern- ment providing for export of the surplus, by the Government financin Includes all available data, Dec. 14. 1921, Russian Poland the movement of exports. But its investigations, both at home and abroad, brought out very clearly the fact that credit to foreign buyers would not solve the problem. Foreigners who had made purchases on credit after the armistice, thinking that exchanges would recover and that they would profit by buying cotton for prompt delivery and deferred pay- ment, had suffered large losses through the further depreciation of exchanges. It had become apparent that the purchase of American commodities for prompt delivery and later payment, which was in- volved in accepting credits, was a gamble instead of a business risk. In other words, it was impossible, on account of the fluctuations in exchange, for the European buyer to determine whether he would gain or lose on commodities which he would have to pay for in dollars and sell in terms of European currency. So he changed his methods and bought only to meet current needs, spreading his purchases over a longer period. The real problem, therefore, was to provide financing for the more orderly marketing of our products — for prolonging the period during which the marketing would take place. COTTON SITUATION IMPROVED. The corporation made some advances to finance the export of cotton to foreign warehouses, there to be sold for cash to the foreign buyer as it was needed, and approximately 250,000 bales were exported under this plan. But a further step was necessary, and early in July the corporation found that, through the large cotton cooperative marketing organizations, it could extend the needed financial as- sistance to American producers on a large scale and put them in position to carry their cotton for orderly marketing. In all, the corporation agreed to provide the resources and ma- chinery for financing approximately 1,000,000 bales and, at the same time, demonstrated its ability to finance such additional amounts as might be necessary. When it was clear that the crop would be adequately financed, confidence was restored, and buyers both at home and abroad resumed purchases. The improvement in the market was reflected in improved prices and the whole business outlook was changed. Though the shock of the experience of the past year is still being felt, we are justified, I believe, in saying that the cotton- growing States may view the future hopefully. REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. 65 While attention was concentrated on cotton, the activities of the corporation in connection with export financing were not confined to that commodity. Large advances were authorized on other agricul- tural products, such as wheat, dried fruits, canned fruits and vege- tables, tobacco, condensed milk, and meat product^. EMEEGENCT LOAN FUND FOE LIVE STOCK. During all this time the live-stock situation was becoming more and more acute. The matter was presented to the War Finance Cor- poration, and our study of the problem convinced us of the necessity of doing something on a broad scale ' for the general agricultural situation, entirely apart from the financing of exports. The live- stock situation became especially demoralized in the early summer; and realizing that it would take some little time for Congress to enact legislation covering the agricultural industry in general, the Secretary of the Treasury called upon the bankers in the eastern money markets to cooperate with the western bankers in raising an emergency loan fund to help the stockmen. About $20,000,000 was loaned from this fund before new legislation enabled the War i'lnance Corporation to come to the rescue of the live-stock industry. This action was helpful to an extent that we can not now entirely estimate, because calamities that are averted can never be meas- ured. In fact, some of our most valuable activities, both governmental and private, jire of such a character that their full effect and im- portance can not be properly appraised. AtJXILIAET BANKING STSTEM CHEATED. With the passage of the agricultural credits act at the end of August, 1921, it was necessary for the corporation to devise methods and machinery for bringing the large resources at its command into effective operation on a comprehensive scale. The magnitude of this nation-wide task I need not undertake to describe. It involved the creation of an auxiliary banking system for the agricultural territory. Circulars explaining the powers and requirements of the corporation under the new law, and application forms and other necessary docu- ments had to be prepared, printed, and distributed. The personnel of the corporation in Washington had to be expanded, and a field organization had to be created to assist in handling applications, for advances. Thirty-three agencies were established in the important agricultural districts to receive applications, pass upon the security offered, and make recommendation to the board of directors at Wash- ington. These agencies are in charge of public-spirited bankers and business men who are serving without compensation and who are keenly alive to the service which the corporation is trying to render to agriculture. The members of the committees not only had to become acquainted with the work themselves ; they had to educate the bankers of their States to the opportunity which the resources of the corpora- tion offered them in the way of rediscount facilities. NEW CAPITAL FOE LIA-E-STOCK FINANCING. Meanwhile, with the approval of the President, I made a trip through the West to get first-hand information on the situation and to stimulate and accelerate our work of financial relief. One of 66 REPORT OF THE NATIONAL AGKICTJLTURALi CONFERENCE. the more important results was the formation of a ntmiber of new live-stock loan companies, each with substantial capital subscribed by local business men, bankers, and stockmen. The capital of these new companies, which has been subscribed during the past tjiree months, exceeds in the aggregate the total amount of capital invested in all the live-stock loan companies that existed previous to October 1, 1921. And whereas the capital of the former companies was con- centrated in a few places— principally in Chicago and Kansas City — the new companies are largely owned and managed locally in the various live-stock growing States. Not only will these institutions serve present emergency needs'; they will add to the permanent struc- ture of live-stock financing for all time. According to assurances I have received from the various States, the first effect of this work was to halt the sacrifice of breeding herds and immature stock, which was endangering, our future meat supply and imposing heavy losses on the live-stock industry. LARGE ADVANCES FOR AGRICUI/TURAL PURPOSES. By the latter part of October the machinery for the administra- tion of the agricultural credits act, both in Washington and in the field, was practically completed, the committees in the various sec- tions of the country were functioning actively, a large number of banking institutions had become familiar with the powers and pur- poses of the corporation, and applications were being received in in- creasing numbers. In November, 790 applications for advances for agricultural and live-stock purposes, involving over $38,000,000, were acted on by the corporation. The volume of business continued to grow until, on January 19, more than 3,000 advances to banking and financing institutions for such purposes, aggregating about $128,000,000, had been approved, in addition to large advances to cooperative marketing organizations. During the week ending January 14, the corporation authorized 455 advances, involving more than $12,000,000, to various banking and financing institutions, which in turn were able to extend old agri- cultural loans or to grant new loans to their farmer customers. These advances were distributed in 31 States, from Alabama and Texas on the Gulf to Montana on the Canadian line, and from Georgia, the Carolinas, and Virginia on the Atlantic to California and Washing- ton on the Pacific, with the great producing States of the Mississippi Valley heavily represented. It is impossible to say how many farmers get the benefit of an advance made by the corporation to a banking institution. A single advance may involve the notes of a large number of individual farmers. One advance which we recently made in the corn belt, for example, involved the paper of some 174 farmers to whom the bank had made loans for various agricultural purposes. When an application is filled out by a local bank it is sent to our local committee. It is then forwarded, with the report of the com- mittee, to Washington, where it is examined by our staff and pre- sented to the board of directors. In a vast majority of the cases the board is able to approve the recommendation of the committee, but sometimes it is compelled to modify them. Long-range banking REPOET or THE NATIONAL AGRICUl,rUBAIi CONPEEENCE. 67 takes time, but the knowledge that the funds of the corporation are available in proper cases and on good security helps to take the pressure and anxiety off the situation. A bank that feels reasonably certain of getting an advance is almost in the same position, mentally and financially, as a bank that has actually obtained a loan. HEUPING TO RESTORE CONFIDENGE. As I frequently take occasion to state, the value of the vi^ork of the corporation is not to be measured in terms of the dollars advanced. Financial collapses are partly tangible and intrinsic, and partly due to fear. The prompt improvement that the corporation has been able to bring about by a general restoration of confidence is of far greater importance than the actual amount of money loaned. Vast numbers of farmers who have had no financial aid, directly or indi- rectly, from the War Finance Corporation are nevertheless getting the benefits of the general improvement of the credit situation, due to the financial relief that has been given to the district in general or to the neighboring territory. No one has ever claimed that the War Finance Corporation, or any other agency, can cure the woes of the world. There is a dis- tinct and separate problem involved, for instance, in the fact that two bumper corn crops have produced over 6,000,000,000 bushels of corn in the last two years. We exported more corn in 1921 than during any other year in the last decade, but corn is not essentially an export commodity. Eighty per cent of it is consumed on the farm, and the ability of the farm to consume it, by converting it into live stock, can not be increased in proportion to the increased sur- plus, except in the course of considerable time. The corporation has, however, I believe, rendered material assistance in connection with the corn situation — at least it has prevented the situation from be- coming very much worse — by the extensive loans it has made to banking institutions, in the corn belt, thus averting in no small measure the forced liquidation which otherwise they would have been compelled to carry on. In addition, the corporation has stimu- lated the feeding of live stock; and large numbers of cattle, which long ago would have gone to slaughter if it had not been for the funds of the corporation, are to-day quietly munching corn on the farm. What corn is to the corn belt, sugar beets are to certain sections of Utah and Idaho. A short time ago the beet growers in these sections faced grave difficulty. They depended for their yearly income upon the proceeds from the sale of their beets to the sugar companies, but when the beets were ready for delivery the companies did not have the cash to pay the growers and the banks were unable to furnish the amount required. A financing company with substantial capi- tal — the law does not permit the corporation to lend direct to the farmer or producer — was therefore organized, and the War Finance Corporation advanced the money on adequate security and thus brought relief to the growers. And large advances also have been made to assist the beet growers of Colorado, the fruit and rice growers of California, the wheat growers of the Northwest, the peanut growers of Virginia, and other agricultufal producers throughout the country. 68 EEPORT OF THE NATIONAL AQEICtTLniBAL CONFEEENCE. STRENGTHENING OF WEAKER BANKS AN IMPORTANT FACTOR. One of the most important factors in the work of the corporation — a factor which can not be accurately measured or properly ap- praised — is this: Where a number of banks in a given territory find themselves in a difficult position due to loans which, though good, are nevertheless slow and temporarily uncollectible, and where those banks are compelled to meet the demands of their depositors for their current needs, a disastrous situation might easily develop if the long rediscounts offered by the War Finance Corporation were not available. This weakness, which all those familiar with agricultural conditions appreciate, is not only a factor with the banks immediately concerned but with the stronger banks as well. If the weaker banks had not been reinforced by the corporation's rediscount facilities, as they have been recently, the stronger banks would not have been as willing as they have been to do their part in the situation. And, as our work progresses, one of the most important effects will be that the stronger banks of the country, seeing that the position of the weaker banks is improving, will come into full, courageous, and helpful activity throughout the agricultural territory. WORK WARMLY SUPPORTED. I am glad to present to the conference this summary of the work of the War Finance Corporation in connection with some of the prob- lems which you are here to consider. What the corporation has ac- complished is due to the whole-hearted cooperation and warm sup- port it has received from the President and every member of the administration; from both Houses of Congress, which have ever evinced their confidence in its work ; from the great group of bankers who are assisting us all over the United States ; from the great farm organizations; and from the loyal staff of hard-working assistants who have never spared themselves and who have worked nights and Sundays and holidays when necessary to speed up the work. ' MUST PROVIDE MACHINERY TO MEET CHANGED CONDITIONS. The more orderly marketing of our crops, which is necessary to meet the changed conditions of the consuming foreign markets and of our own markets, is one of the subjects which may well occupy the attention of this meeting. We must recognize the necessity of selling our agricultural products more gradually than we did in former years, and the corresponding necessity of carrying our commodities for a longer period of marketing. We need the machinery t^at will make possible a 12-months' marketing of our annual production. If we provide financing for the gradual marketing of our commodities, we will be doing only what any sensible merchant would do in handling his business. Before the war, the bulk of our agricultural exports went forward within a short period after the harvest, but this is no longer the case ; and we have here a concrete problem which calls for careful consider- ation. To be specific, in the years before 1914, about 80 per cent of the cotton exported— and I believe this to be true also of other REPORT OF THE NATIONAL AGEICULTtrEAIi CONFERENCE. 69 agricultural products — was sent abroad during the six months after the opening of the harvest. In recent years, the figures indicate that only 50 per cent of our annual exports have gone forward in the same period. In other words, the foreigner is not buying ahead, and we must carry our agricultural products for a longer period. This fact must be recognized and our financing activities and our ware- housing facilities must be organized to meet it. It may mean longer rediscounts with the Federal reserve system, or it may mean new agencies if these longer rediscounts are not deemed suitable to the structure of that system. The collapse in the live-stock industry was due not alone to general economic conditions; it was hastened, to say the least, by unsound methods of financing. The financing of the live-stock in- dustry, second in importance to none of the other great agricultural activities, is worthy of the most thoughtful consideration. The cooperative marketing organizations with which we have been brought in contact have demonstrated the value of the loans made by the War Finance Corporation in facilitating the orderly marketing of farm products ; and this conference may well discuss the methods by which these organizations may be assured of continued financial support, on a sound basis, after the emergency work of the corpora- tion has terminated. Though there is still great distress in the agricultural industry, conditions are on the mend. Out of the experience of the corporation, 1 have acquired a conviction which enables me to look forward to the future with confidence. We have in the United States everything fundamental that is necessary to the restoration of prosperity. We have the resources, the money, and the men. We have demonstrated, both during the war and since, that we have the power to organize. What is most needed now is the adjustment of our resources and our organization to the new conditions. COMMON INTEREST IN AGEIGULTUEAL PROSPEEITT. The agricultural credits act, I believe, will prove to be of incalcu- lable benefit to the farmers of the country, and because of its benefits to the farmers it wiU also be of great benefit to business men, to bankers, to manufacturers, and to labor. The interrelation and com- munity of interest between agriculture, commerce, and finance is a fact that is coming home to the minds of the people generally. It has been my privilege to emphasize frequently the common interest that we all have in agricultural prosperity, and I am glad to note, from the public utterances of our bankers and business men in the financial and industrial centers, an increasing appreciation of this common interest, which is so clear to tHose who have had occasion to study the matter closely. During the period of depression it has become more and more ap- parent that the interests of all classes and all sections are, if not identical, at least parallel. The business men, the bankers^ and the producers are each learning that a sure way to help themselves is to help the others ; that in the long run the best policy is to live and let live ; that the way out of a bad situation is for all to work together with a common purpose and toward a common end — the prosperity 70 REPORT OF THE NATIONAL AGRICULTUEAI, CONFERENCE. and well-being of the Nation as a whole. And as this jjrinciple of action comes more and more into practical application in our eco- nomic life, I believe we shall see a rapidly increasing tendency toward the restoration of business and agriculture to equilibrium and sta- bility. The agricultural interest is not a sectional or a class interest. It constitutes the economic foundation of the country. Directly or indirectly, the interests of agriculture are the interests of all people. THE FINANCIAL POLICY IN ITS RELATION TO THE PRICE LEVEL. By Dr. Wesley C. Mitchell, of New York. The topic assigned me presents a combination of difficulties which I face with reluctance. It is exceedinrfy intricate, it is highly tech- nical, and it is hotly controversial. The only satisfactory way to treat the relation of financial policy to the price level is to base the analysis on a solid statistical foundation. But in 25 minutes I can not present, let alone analyze, the elaborate statistics of commodity prices at wholesale and retail in the United States and foreign coun- tries; of physical production and stocks; of .exports and imports; of the quantity of money and deposit currency; of interest rates in financial centers and rural districts; of wages and employment; of clearings, car loadings, new construction, unfilled orders, bank- ruptcies, bank loans, notes, and deposits, and all the other types of statistics which must, be taken into account by anyone who wishes to form an unbiased opinion and to distinguish what we really know from what we merely giiess. All that I can do in the time allotted me is to give an oversimplified sketch of the processes that have led to the great fall of prices in 1921 and are now retarding a revival of activity. This sketch I have based so far as possible on a study of the facts revealed by statistics, .but I have had neither the time nor the assistance necessary to make that study exhaustive. Hence the conclusions which I am forced by lack of time to state dogmatically are really tentative and subject to modification from the results of the more adequate research for which I hope this conference will provide. Let me begin with an Irish bull: The fundamental reason why prices fell so far in 1920-21 was that they had risen so high in 1915-1919. To understand the fall we must first inquire what pro- duced the rise. If we can mak6 out whether the causes that produced the rise were temporary or lasting in character we shall know how to attack the problem of the fall. In one respect the war-time rise of prices is unique in economic history. There have been more violent price revolutions than that of 1915-1919 in the United States — for instance, during our Civil War both in the North and the South, and in all the other belligerents and most of the European neutrals during the recent war. But never elsewhere has there been so rapid an advance in the price level of a country maintaining a specie standard. Now, prices in a gold-standard country like the United States ex- press the value of gold in terms of commodities just as truly as they express the value of commodities in terms of gold. What happened EEPOET OF THE NATIONAL AGRICtrLTUEAL CONFEEENCE. 71 in 1915-1919 was that gold lost more than half of its purchasing power over commodities, or that commodities more, than doubled their purchasing power over gold. What caused that change? Were these causes temporary or permanent in character? If they were temporary in large part why should gold not regain much, of its old purchasing power over commodities after the war was over? This way of putting the familiar question will help us to get clearer an- swers than the usual way of asking why prices fell. Why, then, did gold lose more than half of its purchasing power over commodities in 1915-1919? First, three of the greatest nations in the world — Great Britain, France, and Russia — wanted enormous quantities of foodstuffs and war supplies from the United States, wanted them as soon as possible and wanted them almost irrespective of price. This gave American producers a chance to charge exceedingly high prices. Indeed, the conditions on which the business was done compelled the Americans to ask exceedingly high prices, especially for all classes of war mate- rial that required new equipment for its manufacture. Nobody knew how long the war would last, and no prudent business man dared accept a war contract unless the price would cover his whole outlay for plant as well as materials and labor in short order. This pressing foreign demand for goods at highly profitable prices started a domestic " boom " — a boom that surpassed in intensity even the great boom of 1906-7. Farmers receiving high prices for their staples, wage earners working overtime at high rates, business meii making extraordinary profits competed for goods with the need- driven foreign Governments. By the middle of 1916 American pro- ductive capacity was booked to the limit. Further increase of supply could be provided only as fast as further plant and equipment could be built and put into operation. But the demand, foreign and domes- tic, was insistent and the people willing to pay the most for goods tried to buy them away from the less needy or the less rich. Of course, this extraordinary combination of demands for com- modities in American markets would have set prices soaring even had there been no change in monetary and banking conditions in Europe or the United States. But in fact there were great changes of this sort on both sides of the Atlantic — changes that contributed powerfully to enhance the rise of prices. The Federal reserve act had been passed just before war broke out in Europe. By mobilizing reserves this measure was expected to in- crease the strength of the American banks so greatly that they would not need to carry in their vaults so much cash as formerly. It was expected that after the new system had become well established the superfluous gold would be redistributed over the world. Gold would be cheaper in the United States than elsewhere and it would move to markets where a better price was to be had. These expectations seemed reasonable in the spring of 1914, but after the war broke out the European nations all suspended specie payments. Presently to pay their huge American bills the belliger- ents began shipping gold to us. Our imports of gold in 1915 and 1916 amounted to almost a billion dollars. So we, who had expected to dis- pose of a superfluous domestic stock of gold, received instead an enor- mous addition to our supply. This metal entered mainly into our 72 BEPOKT OF THE NATIONAL AGEICULTUEAL CONFERENCE. bank reserves and made bank credit the cheapest commodity in the country. It was easy to supply all the money and deposit currency required to finance tlie rapidly swelling volume of business at rapidly mounting prices. That the purchasing power of gold over commodi- ties should decline under such circumstances is easy to understand, though we do not know enough to explain why the decline went just so far as it did and no further. Then in the spring of 1917 came our own entry_ into the war. Pres- ently the United States Government was seeking to buj^ a larger volume of war material than the Allies had bought in America, and at the same time to enlist in the Army and Navy several millions df the men who ha'd been making goods. On the other hand, the Govern- ment amended the Federal reserve act by reducing minimum reserves somewhat further, by transferring the entire required reserve to the Federal reserve banks, and by making it easier for State banks and trust companies to join the system. Measures were also adopted to draw as much of the circulating gold as possible into the banks, ex- ports of gold were embargoed, and bank resources were used freely to finance purchases of Liberty bonds. ^ It was natural that while these policies were in process of adoption prices should take another upward leap as they did between February, when we severed diplomatic relations with Germany, and July. Doubtless this advance would have continued unchecked but for the adoption of price control over many articles. Statistics prove that this policy was successful in large measure. An index number, including 573 commodities brought under price control at various dates during our participation in the war, was reduced from 209 in July, 1917, to 189 in June, 1918. Meanwhile the uncontrolled prices continued to rise, and when the war ended the general price level was almost ex- actly twice as high as in 1913-14. By November, 1918, gold had lost half of its purchasing power; or, if you like, commodities would buy twice as much gold as before the war. If the war was primarily responsible for these changes in the rela- tive values of gold and commodities, why did not gold rise promptly in purchasing power as soon as the war ended? Why did not the great fall of prices begin in December, 1918 ? Of course the fundamental answer is that the economic disturb- ances caused bj7 the war did not stop with the fighting. Let us run back over the list of the major factors mentioned in our analysis of the rise of prices and see how matters stood for the first year after the armistice. The foreign and domestic demand for guns, ammunition, new uniforms, and the like disappeared; but there appeared in its stead an enormous increase in the demand for other classes of com- modities backed by abundant funds. The demobilized soldiers in Europe and America went home by millions, each man with some cash in his pocket and a wild appetite for the pleasures of ordinary life. In Europe the civilian population had been practicing an en- forced economy in consumption — thejr had been eating war bread, wearing old clothes, buying little furniture, taking little leisure. In the United States the majority of families had been economizing for patriotic reasons if not from necessity. When the victory had been won, we, like the English and French, civilians and demobilized soldiers together, felt that a good time was due us. We had plenty of money, and we spent it royally. REPOET OF THE NATIONAL AGElCtTLTUEAL COlSfFEKJEN-CE. 73 On the financial side the chief changes of 1919 were the lifting of the embargo on gold exports, the "unpegging" of foreign ex- change, and the dropping of price controls. Great Government dis- bursements and great Government borrowings^continued. The Eu- ropean nations could not think of resuming gold payments and the process of redistributing the huge stocks of gold which the war had brought us was postponed. Nor were the war-time measures that had increased the amount of credit banks could lend on the basis of given reserves repealed. To meet the eager demand for consumers' commodities supported by abundant funds our machinery for pro- duction was in poor condition. Much equipment adapted to the pro- duction of war supplies had to be scrapped; much of our other equipment had been allowed to deteriorate. Nor were we as workers in a mood for hard and steady exertion. All in all, the record of 1919 in physical output is. one of the lowest, though in point of busi- ness profits the year ranks high. After a slight sag in January to March, prices steadie'd; then in July they shot up again, the prices for consumers' goods taking the lead. Thus was produced the postwar boom which broke in the spring of 1920. Such booms usually break after a year or two at the most, and when they break in the United States they usually produce a panic. That we did not have a panic in 1920 was due to the strength which the mobilization of reserves by the Federal reserve system had given our banks. But though the banks were able to prevent a panic, nothing could prevent a long and painful liquidation accom- panied by a rapid descent of prices toward the prewar level. Why should gold prices two years after the war recede toward the prewar level? Is it not wiser to ask, Why should they not? By 1920 the edge had been taken off the demand for consumers' commodities. We had had our fling, we had bought our most neces- sary supplies. On the other hand, we were getting down to work again and increasing the output of goods.. In Europe men were going back to the soil and raising food. There were ships in super- abundance to bring supplies from Australia and the Argentine, as well as from the nearer ports of America. Government disburse- ments declined; the money paid to demobilized soldiers and war contractors was spent or invested. Gold began coming to us again in great quantities, but under'the stress of liquidation our bank re- serves were none too abundant. We had temporary use for the gold. Most of the forces that produced the great war-time rise of prices had spent themselves. Was it not natural that the price level should fall in the United States? What is there in the world situation that can give commodities a vastly greater purchasing power over wold in 1922 than they had in 1913? ^ This sketch of the processes by which prices were first raised from 100 to 250 and then reduced from 250 to 150 is, as I said, oversimple. It deals only with outstanding factors; it does not discriminate be- tween the fluctuations of different classes of commodities ; it is stated without qualifications ; it is not accompanied by supporting statistics. But I think it does present the question why prices fell after the war in the form most helpful to this conference. Let me add three reflections suggested by this way of stating the question. 74 KEPOET OF THE NATIONAL, AGBIGULTUBAIi CONFERENOE. First, the war-time rise in the purchasing power of commodities over gold and the postwar fall in this purchasing power are world phenomena, not American phenomena ; they are due to world causes, not to American causes. While the changes in our price level have been violent they have been less violent than the changes in coun- tries that suspended specie payments. While we have suffered and are suffering grievously from these changes, our sufferings are less than those of any other large nation. When we come to consider remedies we must remember that we have not merely domestic but world-wide conditions to contend with and world-wide processes to shape. Second, in planning for the future is it not more reasonable to expect that the purchasing power of gold will return nearer to pre- war levels than to expect that, in a world at peace, prices will mount again toward the level attained when the world was' at war? Pre- sumably the nations of Europe will seek within the next five or ten years to reestablish gold standards on some basis. Presumably the production of gold from the mines will not increase greatly. Pre- sumably the production of other kinds of commodities will climb to new world records. What is there in prospect to keep commodities worth one and a half times as much gold as they were worth before the war? Doubtless prices will take an upward turn during seasons of marked business activity, but is not the long-period trend within the span of time we can foresee more likely to be downward than upward ? Third, while I have laid emphasis as in conscience bound on world- wide economic processes, I don't cherish the delusion that we are helpless victims of inexorable economic laws which control our fates. For economic laws are after all merely generalizations concerning our own economic behavior. The relative values of gold and commodities are the values that we ourselves establish. The price fluctuations which trouble us are the net resultants of changes in our own valua- tions. It is possible to alter our- economic behavior — though it is not easy. But to make changes for the better it is necessary to be cir- cumspect, to consider carefully how a modification' of one process in our complex economic life will affect other processes. To discuss con- crete programs of action is not part of my task. But may I not close with a plea for basing the recommendations of the conference on a careful study of the facts which constitute our problem, the facts of human nature as well as the physical facts, the facts relating to other countries as well as the facts relating to the United States. FUNDAMENTALS OF COOPERATIVE MARKETING. By G. Haeold Powell, of California. America is an open forum for the discussion of the financing, distribution, and marketing of the Nation's farm crops. An almost complete collapse in the machinery of distribution and marketing occurred in 1921. Vast surpluses "of staple Crops are still left on the farm unmarketed, or else have been sold at prices far below the cost of production, while the prices of the articles the farmer REPORT OF THE NATIONAL AGRICULTtTRAL CONFERENCE. 75 buys have remained so high proportionally as to strike a stagger- ing blow at his prosperity. JBecause of its interrelationship with agriculture, the social and economic structure of America has been vitally involved. This condition is the result of many complex fac- tors that are inherent in the readjustment that has been taking place since the close of the World War. Most important of all, it is a re- sult of the unpreparedness of the American farmer to handle through collective action the problems which he, as an individual, has been powerless to solve or even to influence. There are some exceptions to the conditions outlined above, espe- cially among the organized horticultural industries of California, that stand out as a flame of light against the dark background and point the direction toward which the thought of the Government, of the American farmer, the banker, and of all othet interested men should be directed. Most of the California growers received prices for their fruit crops in 1921 that returned more than the cost of production. In these fruit industries the farmers are organized to "handle the problems of production and the purchase and manufac- ture of supplies; they are associated, by industries, in marketing agencies through which their crops are standardized and prepared for sale; their fruits are generally distributed and sold through their own representatives to the wholesale trade in the towns and cities where they are to be consumed. The fruit purchased by the wholesale trade in the various towns and cities is for their immediate requirements and not for future' sales, therefore the credit risk of the local banks, which finance the wholesale dealers, is practically eliminated. Not only have these products returned the cost of production to the producers, but the trade also has made fair profits. But the steadily sustained demand by consumers for California fruits is an evidence of the power of continuous, friendly advertising, coupled with sound merchandis- ing methods, in promoting a larger consumption of farm products. These California cooperative growers' organizations, by decreasing the unnecessary speculation that is inherent in the buying, distribut- ingj and selling of most farm crops, are reducing the hazard in pro- viding the necessary credit for their production and for their or- derly distribution. When well organized and well directed, they furnish the soundest possible contact between the producer and the institutions that finance the production: and distribution of farm crops. The favorable position of California's horticultural industries at the close of this last year of extraordinary business perplexities is not the result of fortuitous circumstances; it is the fruitage of the foresight of the porducers who through many years have been build- ing up their cooperative inarketing organizations, standardizing their products, selling them in enormous volume, cooperating with the trade, creating larger markets and increasing consumption by continuously presenting the desirability and value of the product to the people. Had the California cooperative marketing organiza- tions not enabled the fruit growers to handle their financing, dis- tributing, and selling problems collectively they would have been engulfed, like many other horticultural and agricultural industries, in the backwash of the World War. It is not presumptious, there- 76 REPORT OF THE NATIONAL AGRICULTTIBAL CONFERENCE. fore, to suggest that American agriculture and the public generally would pr-ofitabljr study the factors that have contributed to the wel- fare of California in the face of general business depression. Whenever American agriculture is depressed the movement toward cooperative handling of farm problems receives an active impetus. We are passing through such a period now, when clear thinking is needed, when the farmer can achieve notable progress or make colossal blunders unless sound reasoning is brought to bear on the problems of the producer and a procedure is developed that will ultimately be best for the upbuilding oi country life. In the course of an experi- ence of 30 years the California fruit industries have found no place for miracles in solving the farmers' complex marketing problems. There are no magic forms of organization or contracts which bind growers together, through which a vital, living spirit can be spon- taneously created in men which persuades them that by working to- gether they are better able to solve their individual and common questions. The ultimate success of any cooperative marketing effort depends on the will of the farmer to cooperate, on a spirit of mutual confidence and trust in one another. But it is also dependent on the development of the most adaptable forms of organization and the most efficient management and procedure. A form of organization may be easily adopted, and business man- agement may' be provided, but the will to cooperate develops slowly in the farmer's consciousness, out of his efforts toward actual co- operation. Therefore any cooperative marketing organization, that is quickly formed needs most careful watching, because the average farmer is not skilled in the arts of competitive business ; he is slow to delegate authority to anyone and reluctant to yield any part of his individual freedom by modifying his own actions to meet his neigh- bors' needs. A DEFINITION OF A COOPERATIVE MARKETING ASSOCIATION. Cooperation among farmers may be defined as an enterprise in which the members form an agency through which they conduct the business for their greater mutual advantage. To be cooperative it must be composed of farmers exclusively and managed by them, and the benefits must be returned to them in proportion to the use or the patronage of each. That part of the capital necessary to create the agency and its facilities, which finds an expression in the management of the association through the voting of the members, should pref- erably be contributed by them in proportion to the use which each makes of the organization. And it is desirable that the capital of each member should be kept progressively proportional to the indi- vidual shipments or purchases or other uses made of the agency as nearly as this niay be done. Capital in a cooperative agency, which creates the permanent investment, should be considered as a means of providing the facilities needed by the members ; it must not be a fund on which a dividend is paid in excess of a fair rate of interest. Work- ing capital may, of course, be provided in other customary ways. In forming a cooperative marketing association it is fundamental that it be a proper legal entity, with sufficient powers to transact the REPORT OF THE NATIONAL, AGRICULTURAL CONFERENCE. 77 business for which it is formed, to finance its activities, and, when necessary, to secure its obligations, thus equally with other corpora- tions safeguarding the interests of its members as well as of the insti- tutions with which it transacts business. THE MEMBERSHIP IN A COOPERATIVE ASSOCIATION. Membership in a cooperative association should be confined ex- clusively to producers who are engaged in the production of the par- ticular commodities with which the association is concerned and who actually use its facilities. This is a basic test of its cooperative character. Any person engaged in the same industry in the same locality should be admitted to membership without unjust discrimi- nation. Those who contribute capital only should never be admitted, to membership, because the permanent capital should be the medium through which the members provide the facilities for the transac- tion of their own business; therefore, it is not desirable that per- manent capital be furnished by nonproducing business interests which would thereby acquire a power in the association and a voice in its direction. Membership in a cooperative organization carries with it a responsibility on the part of each member to maintain it in periods ^of adversity — a responsibility which is not likely to be felt unless the organization is the farmer's own institution, devel- oped and managed by him through his chosen representatives, to promote and safeguard his own interests. THE VOTING POWER OF MEMBERS. It is desirable that the voting power in a cooperative association should be based on the " one-man-one- vote " principle. This prin- ciple of voting, however, should not be made a test of the legal co- operative character of, an organization. A recognition of the equality of membership is the best evidence of mutual confidence, because, in the final analysis, it is the members who, as men, coop- erate, and their success depends on their belief in each other and on their fairness in dealing with their common business problems. One can not overemphasize the fundamental necessity of confidence, faith, and sentiment among the membership of a cooperative mar- keting association; nor can one overstate the need to develop and maintain that mutual confidence through open meetings of a board of directors, in which the members may take part, and of utilizing everv known means to keep the purposes and accomplishments of the organization before the members as well as before the public generally. THE MEMBERSHIP AGREEMENT. A cooperative association must be held together through an agree- ment or contract between the organization and each member. A contract gives the organization a stability that enables it to know definitely what it is expected to do, to enter into dependable busi- ness relationships, and to make the necessary financial or other prep- arations essential to the conduct of its affairs. A membership agree- 78 REPORT OF THE NATIONAL AGRICULTURAIj CONFERENCE. ment is a steadying influence on each member who may not be accus- tomed to working with others and who may be led astray by outside disrupting influences; nevertheless no contract can hold a group of farmers together against their will. Contracts, buildings, plants, or even profitable sales do not in themselves always assure the perma- nency of a cooperative association. The greatest safeguard against disruption, as well as its strongest business asset, is the development of faith in one another, confidence in the directors and management, and a growing conviction that the best method of meeting the far- mers' common problems lies in their cooperative efforts. It is in the interest of dependability that a membership agree- ment should extend over a- long period of years, if provision is made that any dissatisfied member may withdraw at some specified time during its existence. The long-term contract adds greater stability to the organization as an institution of business, while the with- drawal privilege, when reasonably safe-guarded, removes the dangers that are inherent in unwilling cooperation. The ultimate success of a cooperative organization will depend not only upon the development of a spirit of cooperation within the membership, but, also, on a willingness to cooperate with the agencies with which it has business relations. No farmers' organization can eventually live that is managed arbitrarily; it is likely- to succeed only as the members develop a living, breathing spirit of mutual effort; and this vital, living spirit must also be manifested in its board of directors and in those who are responsible for its naan- agement. The cooperative movement does not represent a business system alone though it must, of course, develop the highest form of business efficiency to justify its continuance. It involves, also, a very intimate, human quality whose roots are deeply implanted in the social nature of men, and whose expression leads them to work willingly and unselfishly together. A cooperative organization that fails to appreciate this and attempts to impose on the American farmer the practices of an impersonal, business corporation, is apt to fail even I though it may temporarily achieve notable business results. DANGERS OF UNRELATED ACTIVITIES. Because a cooperative marketing organization represents inherent power — and the larger the organization the greater its power- — its danger lies in becoming involved in political affairs, and in move- ments which, though worthy in themselves, have nothing to do with its primary purposes and can only lead to a divided membership and factional control, with ultimate disruption. It is essential to the permanency of a cooperative association that its activities be restricted to the primary purposes of the organization, and to those which directly relate to the upbuilding of the industry. A COOPEEATIVE ORGANIZATION SHOULD BE BUILT AROUND AN INDUSTRY. A cooperative marketing organization is most likely to succeed if it is built around a single industry, like fruit, grain, cattle, to- bacco, or cotton. Each industry has its individual problems to solve, its special difficulties to overcome, and its particular trade REPORT OF THE NATIOK'Al. AGRICtTLTURAL CONFERENCE. 79 practices and connections' with which to deal. These organizations that handle several crops have so far generally been unsatisfactory because of their complicated trade relationships, and also due to the lack of mutuality of interest among the producers. THE LOCAL UNIT THE STRONGEST FOUNDATION EOE A COOPEiRATIVB MARKETING AGENCY. The strongest organizations are those which specialize in handling a single crop, such as citrus fruits, raisins, walnuts, prunes, peaches, etc. ; and, when this specialized organization is adopted, it develops the greatest dependability if founded by small groups of growers who are neighbors, who have confidence m one another, who belong to the same churches, schools, or other neighborhood institutions, and who federate these local units into a central marketing agency. These neighbors form local associations, provide packinghouses, warehouses, and other permanent facilities through the investment of their own capital ; they take part in local management, and are an intimate personal part of their own institutions and their activi- ties. These local units are centers of vital influence for good in a community. They promote every activity that affects the upbuild- ing of country life, because the members learn to meet their problems together. No country district is so well assured of a balanced de- velopment in all of its civic and business life as one whose activities spring from the experience of a successful, local, marketing asso- ciation of farmers. In the California Fruit Growers' Exchange, for example, through which 10,500 members sell nearly one hundred million dollars' worth of citrus fruits, annually, to the wholesale trade, the growers have formed more than two hundred local associations, each owning its own packing house and managing its local affairs. For business efficiency, these associations federate into a central agency through which they provide the facilities for the sale of their fruit. Prob- ably nowhere in the world has cooperation among farmers been more greatly decentralized by developing local responsibility, a pride and initiative in handling communit^^ problems, and a spirit of emula- tion in the development of the highest grade possible to that local- ity; and, at the same time, they have coordinated the efforts of the local units into a practical, efficient, central agency through which they distribute their product. The decentralized form of organization may not always be adapted to a seasonably produced, nonperishable or semiperishable crop that requires warehousing, or needs to be prepared for distribution in a central plant and finances provided for storage, distribution, and sale. In such industries as these, a larger centralized marketing or warehousing unit may be a more adaptable business form. But those who are responsible for its direction should never lose sight of the need to develop a local participation and some degree of responsi- bility in the affairs of the organization. Failing to do this, and to keep the members thoroughly informed, is likely to result in a large, impersonal association in which the member is removed from par- ticipation in solving his individual, local affairs and becomes a sub- merged, disinterested part of a centralized form of corporate or- ganization. 92640— H. Doc. 195, 67-2 6 80 REPORT OF THE NATIONAL AGRICTJLTURAIj CONFBEBNCB. AVOIDABLE WASTE TJNNECESSART SPECULATION — TRADE COOPERATION. The establishment of uniform ^ades for agricultural produce is one of the most important questions affecting American agricul- ture. It is equally important to the producer, the trade and the con- sumer. The waste that occurs in badly handled, ungraded farm products is one of the leading causes of the high cost of distribu- tion, because this waste must either be deducted from the farmer's price or added to the cost of distribution. It is important to the wholesale trade because the merchant can not sell at low, gross mar- gins unless foodstuffs are uniform and dependable in grade and quality. It is equally necessary to have an equitable, dependable supply of a food product in the hands of the retail merchant, at prices depending on the law of supply and demand, if he is to add only reasonable margins in the sale of his products. In the California citrus-fruit industry, for example, the former average loss of one and one-half million dollars annually, caused by decay due to bad handling by the individual grower, has been practically eliminated by standardized association methods of har- vesting and packing. The cost of distributing the fruit from the producer to the wholesale trade, exclusive of freight, has been re- duced from 15 to 2^ per cent, including the cost of national adver- .tising; while the dependable supplies furnished by the cooperative organizations have made it possible for the wholesale and retail trades to sell these commodities at gross margins not much in excess of those added to the sale of nonperishable foodstuffs. A cooperative organization may be able to eliminate the unneces- sary wasteful speculation that is sometimes inherent in the purchase of farm products at the farm or local station, by selling through their own agents to the trade on arrival in the places where they are to be consumed. This system of delivered sale, if well administered and adapted to an industry, assures a more dependable, equitable dis- tribution; it eliminates speculation in purchase and in distribution, and it supplies the trade with its daily requirements at prices which must necessarily closely reflect the law of supply and demand. In 1921 the delivered method of selling was one of the outstand- ing factors in saving some of the California horticultural industries from a collapse similar to that which occurred in other industries in other parts of the country. The production of the crop was financed by the grower's local bank. Through his organization the. grower distributed his product throughout the country at his own risk ; the banks did not have to finance a speculative buyer, thereby making it safer for them to finance the grower who produced the crop and distributed it in an organized, intelligent manner to the consuming centers. The wholesale trade bought their current requirements from the grower's agents on the arrival of the cars; the retail trade, in turn, bought their daily supplies from the wholesale dealer, thereby reducing the hazard of the banks that supplied the credit for the daily merchandising needs of the wholesale and retail trade. THE NEED OF DISTRIBUTING AGENCIES. In every agricultural industry the crop needs to be financed, as- sembled, processed, packed or stored, and transported and, with or without further manufacture, sold by the wholesale and retail trade REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. 81 to the consumer. There should be no antagonism between the essen- tial agencies involved but rather a better understanding of the func- tions of each and a closer cooperation between them. The producers and the public generally need more knowledge of financing, assem- bling, distributing and selling the Nation's farm crops. A large part of the endless conflict between the producer and the distributing agencies, extending to the consumers as well, is the result of a lack of dependable information regarding the cost of production and of distribution. Until an industry has clearly analyzed its problem and has an accurate knowledge of the complicated financing and dis- tributing processes, no graver mistake can be made than to assume that a remedy for its marketing difficulties lies in the elimination of one or more of the agencies of distribution. These agencies are closely interwoven with the necessary financing and distributing ma- chinery and have generally grown out of a vital need in distribution. Only after a farmer's organization has proven that it can perform the same service more efficiently or more economically should it de- cide to eliminate any of the present links in the closely interwoven chain of distribution. Rather should it cooperate with them more closely to the end that there may be a clearer understanding of each other's problems, supplementing of each other's efforts, and a de- velopment of the simplest, most economical methods of distribution. Although there may be present abuses, unfair and occasionally dishonest practices that may be eliminated by legislation, and though the banking system may need to be adapted to the ba-ic needs of the different agricultural industries, yet the practicable reforms in the distributing system will be found equally in the handling of farm crops under conditions which insure more efficient and eco- nomical methods of merchandising. It is also well to point out that though the producer has ever been ready to invoke the law to save him from the fate of modern condi- tions, he should appreciate that any effort to reduce the cost of distribution through legislation, or by other governmental action — except as it provides a sound legal basis for the organization of farmers, establishes legal grades and standards, makes the currency system more adaptable to the necessities of agriculture, prevents unfair or dishonest practices either by the producers or by the dis- tributing agencies — is likelj to result in the future, as it always has in the past, in disappointment. Anything that can be done by the State or Nation which is im- possible of achievement either by the individual farmer or his organization, that helps them to a better understanding of their problems, that develops the factors which affect the handling, stor- age, and transportation of crops, that furnishes dependable in- formation on crop production, or other information that serves as a guide to intelligent distribution and sale, and that insures the principle of a " square deal " in all business relationships is in the interest of the producer, the trade, and the public alike. It is in the public interest that those branches of the Department of Agri- culture which furnish this basic crop-production or marketing in- formation, as well as the regulatory branches of the department, shall be adequately supported and eiSfectively developed. 82 REPORT OF THE NATIONAL AGRICTJLTUEAL CONFERENOE. To do less than this would be a grievous national blunder; to do more may weaken the initiative and sap the virile qualities of the individual farmer, in the exercise of which lie the strength and assurance of a finely developed country life. Further, any legis- lation that does more than provide for the basic needs of an in- dustry or which savors of preference to a class arouses antagonism among all other interests and especially on the part of the public. LEGAL PHASES OF COOPERATIVE MARKETING. There should be an affirmative statutory recognition that farmers have the legal right to organize, to do those things that are vital to the economical and orderly conduct of their business from the production to the consumption of their product, to act collectively in doing those thi,ngs which the individual farmer would otherwise do for himself, to form purchasing, warehousing, distributing or other necessary agencies, to confer among themselves and to ac- quire and disseminate information for the orderly purchasing, dis- tributing, and marketing of their supplies or crops, to finance their undertakings and to enter into necessary financial relationships, to handle their questions as distinct agricultural problems. There should also be recognition of this legal right to sell in open compe- tition among their different units or under uniform conditions through a central agency, and to determine the prices which fairly reflect the law of supply and demand. The legality of a cooperative marketing agency should not be made" to depend upon the mere form of its internal organization. Whether it shall be formed with or without capital stock, whether it shall have equal or unequal voting power of members, or whether it shall pay interest or dividends on the capital, should not be written into the State or National statutes as a test of its legality. These matters are not fundamentals in cooperation but are mere details of form which the members should have the right to select or reject without legal prejudice because of variations in the form ol organization or of internal management. To deny such legal recognition by the State or Federal Govern- ments will not help to meet the fundamental necessities of organized cooperation among farmers and will lead to endless conflict and confusion. Farmers should be given the right to organize in what- ever form is best adapted to meet the inherent needs of a given agri- cultural industry. A cooperative agricultural association should then be tested by the following principles : First. Operation of the association for the mutual benefit of its members. Second. Limitation of membership to those actually engaged in the production of commodities with which the association is con- cerned. Third. Distribution of the proceeds, above a fair return on the invested capital, on a basis of business transacted with or through the association. Fourth. Any person engaged in the same industry in the same locality shall be admitted to membership without unjust discrimina- tion. EEPOET OF THE NATIONAL AGRICXTLTURAL CONFERENCE. 83 But the lodging of power in the hands of farmers by the State or Federal Government may not always be exercised in behalf of the public welfare. Farmers, therefore, should realize the desir- ability of having the Government, which gives them the right to cooperate, lay down the conditions under which the privilege shall be exercised, in order that acts that are prejudicial to the public interest, in any plan or form of organization, may be eliminated. Any undesirable practices that are thought to exist, should then be examined and modified or eliminated as a result of discussions be- tween the Government and the organizations involved. Only as a last resort should the courts intervene to determine the legality of alleged undesirable practices. THE RELATION OF THE COOPERATIVE JIARKETING ASSOCIATION TO THE PUBLIC. A cooperative organization has a distinct responsibility to the public. It can not live for itself alone. Through the cooperative handling of farm crops, the farmer should receive a fair return for his products, but such cooperation should be an important fac- tor in reducing the general cost of living through the economies that result from the organized preparation, distribution, and sale of standardized products. The producer is entitled to a fair return on the cost of production provided the law of supply and demand warrants it, but he is not privileged through the power of organiza- tion to impose a higher price on the consumer than the law of supply and demand naturally justifies. As an outstanding factor in the permanency of an agricultural policy, the farmer must, of necessity, over a series of years, receive for his crops a price in ex- cess of the cost of production. The cooperative marketing system is the most important factor in insuring a fair jjrice to the farmer. But if the law of supply and demand does not return the producer a profitable price for his crops there must be eventually a natural automatic reduction of the supply in adjustment to the demand of the consumer. The future of cooperative marketing rests not only on the ability of the farmers to handle their business problems, but also upon how well they meet the present pressing questions that lead to world-wide social and economic unrest. These obligations should be inherent in all cooperative organizations ; they are responsibilities which no group of producers can avoid. No group of farmers should have the right to operate collectively if it uses the power of organization to restrict production artificially, to lessen or arbitrarily control the supply, to permit avoidable waste, to speculate, to make profits that do not reflect the law of supply and demand, to create any situation through the power of organization that is discrimina- tory or unfair to the public or to a competitor, or to give a mem- ber, an officer, or an employee any advantages that are not open to all alike. But it is in the public interest, and most vital to the restoration and stability of American agriculture, that cooperative marketing shall be encouraged and assisted by the Government and the public generally, and that the State and National Govern- ment shall affirmatively recognize the right of farmers to organize 84 REPORT OF THE NATIONAL AGRICULTUBAL CONFERENCE. in order to handle agriculture's inherent problems. The test of these organizations should be '•' what is their substance," rather than " what is their form." They must serve the public as well as their own members if they are to constitute effective agencies through which the complex problems of American agriculture are to be solved in the ultimate interests of the whole Nation. THE PLACE OP THE INDEPENDENT DISTRIBtrTOBS. By William L. Wagnek, of Illinois. The use of the term "independent" would indicate an individual or phase of industry not fitting into the general scheme of things, or at least a system antagonistic to cooperative endeavor as applied to marketing. The general understanding is that by "cooperative marketing " is meant a union of producers who not only produce but assemble their product and market it themselves without at any time losing control of their product, while as against this stands the " independent," who in some manner or other seeks and obtains ad- vantages to the detriment of the producer. Nothing could be further from the truth as applied to the latter. To succeed he must work along lines of highly concentrated cooperation and his every en- deavor must be governed by that need of cooperation as between himself and the producer. That there is a so-called " independent " distributor is not a matter of chance. It is but the outcome of the natural order of things. He is the pioneer who, through his vision and knowledge, develops and stimulates production and brings it to the point where coopera- tive marketing may be discussed. The independent distributor has no quarrel with cooperative or any other form of marketing, but, on the contrary, is entirely sym- pathetic with any method that has for its purpose iDetter conditions, greater production, and improved service and value to producer and. consumer. On the other hand, I think I can state just as emphati- cally that with him who understands there can be no quarrel with the independent distributor. The production of perishable food products is a business or pro- fession purely agricultural. And upon the other hand distribution is a business or profession distinctly commercial, and no matter how closely the two, may be interwoven or allied they are fundamentally separate and specialized industries, each requiring a special knowl- edge acquired by study and experience in connection with the par- ticular items produced and marketed. In the early days production of perishable food products was more or less haphazard. In those days the commission merchant who maintained at the larger points of commerce a store and a corps of salesmen was the only outlet through which these perishables could be marketed. With the coming of refrigerated transportation and the constantly developing of urban centers increased production became not only possible but a necessity. With the increased production developed two additional classes of merchants — i. e., the wholesaler and the jobber. KEPOHT OF THE NATIONAL AGRlClTLTtrEAL CONFEEENCE. 85 The wholesale merchant, commission merchant, and jobber derive their supplies from world markets and make available to the con- sumer fruits and even vegetables from many parts of the world, They do a year-round business in many commodities, following the seasonal production in the various sections and keeping constantly on sale such products as are available. In this way the overhead or cost of doing business is kept at a relatively low figure, whereas if one or two seasonal commodities only were handled the overhead would be prohibitive. Between all of them they are constantly seeking new markets and pushing fruits and vegetables even to the hamlets and crossroads. As a further process of evolution has come what is now technically known as the distributor, and it is he who while performing a strictly commercial service performs one so thoroughly trained and so highly specialized as to be professional in its character. He offers to the producer, whether as an organization or an individual, all of the ad- vantages of cooperation, but without loss of individuality ; the privi- lege of personal selection of a marketing agency ; not only the right, but the opportunity to develop a personal pack and brand or the advantage of marketing under a brand already established and a marketing and distributing service with an already developed and proven value. Many of our large producing centers of fruits and vegetables owe not only their present importance but their very existence to the services rendered by the so-called "independent" distributors. It is not my thought to develop a parallel as betweeri the functions per- formed by the so-called " cooperative " marketing agencies and the " independent " distributor. A checking and analysis of these func- tions will develop the fact that there is no cooperative system that cooperates to a greater extent or more effectually than that employed by the independent distributor. Even a superficial knowledge of the marketing of perishable prod- ucts will demonstrate that a certain amount of machinery is an abso- lute necessity from the time that the product leaves the producer until the time it reaches the ultimate consumer. Just as surely as the law of supply and demand governs the prices obtained, so does it control the character of the machinery or distributing agency used, and it is an inevitable conclusion that a system of distribution must demonstrate its efficiency and economy to endure. That different methods are employed or that competition exists among distributing agencies is not an unhealthy sign, but on the contrary, it is most certainly to the advantage of the producer. Another class of buyers, peculiar to certain sections, are those who buy crops in their entirety, having these crops packed under their own direction and distributed through their own established organi- zations. While these systems vary, they may all be termed inde- pendent distributors as distinguished from the cooperative market- ing system. Each or any of these offer to the prbducer the free use of his own intelligence in the making of a section as to the agency to be employed and to exercise his own judgment as to that method of distribution which shall produce for him the utmost limit of net compensation and the very competition of methods employed. The necessity for demonstrating efficiency and economy to maintain one's 86 EEtOKT OF THE NATIONAL AGKICULTtTRAL CONFEEENCE. clientele means that a maximum volume of service is rendered the producer and that, under conditions existing, a maximum result is obtained. A careful search of the history of the cooperative organizations in connection with the production and marketing of perishable food products, finds two classes or forms of organizations and with widely different results as applied to classes. Those which have been or- ganized for the purpose of manufacturing the product, doing the necessary grading, packing, and assembling in quantities and then employing an independent distributing service, have in a large measure been successful. On the other hand, those that have been organized to carry on beyond the manufacture and actually do their own marketing and distributing have not been so successful, and it is found that few if any of such organizations now exist that were organized 10 years ago except in those instances where the com- modity produced and ma,rketed constitutes practically a monopoly. By monopoly is meant that no competing' production is found in other sections of the country at the time that their commodity is pro- duced. Even by the successful ones, some marketing agency must be either employed or created, and the choice is presented of employ- ing, at a fixed cost Nvith a predetermined overhead, the already or- ganized and highly efficient and specialized sales service of the so- called "independent" distributor, or of employing, organizing, and training a force of salaried employees, with an undetermined and most uncertain overhead. The place of the independent distributer is not a self-created one, but one developed by natural conditions, and in the general process of evolution he has kept pace with the changes; his vision is broad and not confined to his immediate cortimodity or environment. Through competitive service he maintains a place as between the producer and the consumer. He is f or<;ed to realize values that will stimulate production and yet such values as will not develop monop- oly or extortion — such values as will induce consumption and through siich consunaption justify production. No demand or suggestion for his elimination has ever been made by those engaged in the produc- tion, and any thought that such a demand does exist is founded only upon imagination. THE MAKKETING OE COTTON. By Governor John M. Parker, of Louisiana. Ten minutes does not give much opportunity to express details in regard to the marketing of cotton, and unless there is serious objec- tion my paper on that subject will be filed with the usual congres- sional permission to ask leave to print it where anybody can look at it and enable me to take my 10 minutes to make a few practical suo'- gestions in regard to the great gathering for which we are here. _ Trade is born of the necessities of commerce. Every man in everv line of industry and agriculture is deeply interested in it. It is the prosperity of our Nation and we should have a trade commission of able, practical business men, absolutely free from any political taint or suggestion, who would keep our manufacturers and our agriculturists BEPORT OF THE NATIONAL AGEICTJLTTJEAI, CONFEEBNCE. 87 constantly and eternally posted in regard to the conditions of those countries whose trade we seek and where we wish to send our goods. The biggest investment this country can make is in securing able and capable representatives of that character to keep us not only at all times posted in regard to what the needs of those countries are but as to what they want and how it should be packed and then as to terms and conditions. And it should be where there is no siich thought as politics in it, but a permanent commission of able, capable men devoting their time to keep America posted in regard to the wants and needs of the world. Very few of us realize how vitally important cotton is to the prosperity of the United States. Many of us do not know that it has maintained the balance of trade in our favor for many years. We do not realize that it gives employment in the cultivation, marketing, harvesting, gathering, transportation, and manufacturing to more people than any other industry, and that, in addition to that, insurance and banking are closely identified with it as well as national prosperity. The Federal reserve bank was created not to pile up a vast surplus, but with the idea of affording an elastic currency and preventing disaster. Not only has that bank piled up an immense surplus, running, I was advised, away over the hundred million mark, but it can not pay. to its stockholders dividends in excess of 6 per cent. The United States Government to-day has more than three-quar- ters of all the gold on the face of the globe, and if it had 100 per cent of that gold and it was not utilizing it in the benefit of com- merce, what would it be worth? And I venture to make a common- sense practical suggestion that appeals to me because already m the estimate of Congress the Federal reserve bank has the power to es- tablish its foreign branches, and that is to utilize this surplus which they have, not lending to the nations of the Old World who already owe us an overwhelming amount, but lend it to the honest individ- uals and manufacturers whose work and lives' record is that they are entitled to credit and entitled to consideration. Work out a plan by which this can be loaned, not on short time but on long time, because there is not a one of us that does not know the plight of those people who are crying for food and many of thenf need clothing. And if these very same people can buy oui' staple from the South, cotton, and start their mills going and the whirring of their looms, that would give employment to countless thousands in every one of those countries that are now holding out their hands and begging to America, and these very people by their own work, because they are not beggars, will be where they m turn can earn their living. ^ j-i, ■ u j We are where all Europe practically are holding out their hands to us • we are where Congress in its wisdom has sent many millions of dollars worth of goods to those people to save them from stars^ing ; and we are where constantly we see appeals for this nation and that nation and the other nation to help them out. Why not help them out on broad lines instead of sending food; or send our products on American ships, which will give employment to thousands of other people and enable them to build themselves up. Let these TieoBle be by their own work where they can buy not only our south- ern product, but where they can buy the wheat and the corn and the 88 REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. other necessities of life to make people happy and contented, be where the risk in regard to it would be reduced to a minimum, re- duced because by your Federal reserve bank located as it is now and with the position that it has, they could send their accredited representatives to the great nations of Europe and put in the cen- tral heads of the big banks there. They could take the life record of these men and these mills and these spinners, and could sell them, based on their acceptance, based on the acceptance of the local banks, and all documents to be in the hands of the Federal reserve bank. It is making it a commercial proposition on the biggest possible basis. These documents would be held in trust where they in' turn over there could sell their manu- factured articles to their people on longer time than jthey are able to get now. And when they sell to the customers of these countries they give them their notes or their drafts which would be imme- diately turned over to the representative of the Federal reserve banks and held in their hands all the way through. In the event of disaster of any kind or character of their cotton or wheat, or any other products that might be sold on this basis, the Federal reserve bank would have the bills of lading and the insur- ance policies, and instead of being a political transaction it is simply a common-sense commercial transaction, and one where if we are able to give these deserving people through their credits of 6, 12, or ' 18 months, within only a few months we will find that this surplus that to-day is demoralizing and dragging down farmers and agri- culturists all over the country, will be sent to these people who have their hands stretched out begging for it, and who will thank us from the bottoms of their hearts for again trying to put the world on a basis of practical common-sense. This is the first agricultural gathering ever called and should for all time remove any question of the fact that one section of the country is as deeply interested as is the other. We find every State represented here, and your President and your Secretary of Agricul- ture have shown admirable judgment in bringing patriotic Demo- crats from the South to work shoulder to shoulder with patriotic Eepublicans from the North, and, at the same time, I would be un- true to myself if I did not emphasize something that I have heard time after time. My judgment and my belief is that these people are doing all they possibly can to help agriculture ; and still you hear it whispered all around that this is an absolutely hand-picked, cut-and-dried per- formance, where we will ultimately get such resolutions as they see fit to present to us. This is the first public gathering of the kind that I have ever attended where those deeply interested in industry did not select their own men that they felt big and able and strong to pass upon the problems which we now seek — big cattle men to select their own men, sugar men and rice men ana cotton men to select their own men, because they would know these problems from the beginning up. They would know them from the practical side and from the practical standpoint infinitely better than the ablest and best of our public men who understood many things miles away from the fields but who are not familiar with the problems of the ranches and of the fields. I earnestly hope that there is no foundation what- BEPOET OF THE NATIONAL AGRICULTtlEAL CONFERENCE. 89 soever in that rumor. My belief is and my hope is that we are here to try to the very best of our ability to intelligently solve for the benefit of all humanity those great problems which confront us. Sometimes I think that we make mistakes — and very serious mis- takes ; that many of our public men are infinitely more interested in going back to the office which they hold, or securing an office a little higher up than they are in regard to the welfare of our people. As a farmer for nearly 40 years i want to say that I know that agricul- ture is less understood than any other interest in the United States, and still it represents the real foundation stone in the real prosperity of the Nation ; where, if we are to accomplish anything, it must be on practical common-sense lines; where we earnestly try to work out plans to see that our surplus, not created by us ourselves volun- tarily, but a surplus created after appeal after appeal of the Food Administration, of which I happened to be one, and appeal after appeal of the National Government, increased production, increased production, increased production. When we followed their plans and followed their request we find that we have increased pro- duction to the point that it is crushing some of us almost out of existence. We have the right to come to Washington, both as Ameri- can citizens and working in financial and State welfare, and ask help in these great problems. That great American, Theodore Roosevelt, coined the phrase: " The time has now come to put the public welfare in the first place." That phrase was never in its history truer than it is to-day, when the ranchman of the Far North and West, the wheat and the corn producer of the Central United States, the rice and the cotton pro- ducers of the South are where they face misery and ruin and loss and the largest part of all of their products. Therefore, I appeal to you earnestly to put aside all that is political or anything in the world except national welfare, as loyal Americans let us get together and do all that lies in our power to restore peace and happiness and prosperity to our people, and especially our agriculturists who are now sorely, sorely tried. COOPERATIVE COTTON MARKETING By Gael Williams, of Oklahoma. The year 1921 witnessed a greater extension of the cooperative marketing idea among farmers than has appeared in any previous 10 years of the Nation's history. The Great War taught farmers to think more intelligently than ever before concerning economic questions, and the postwar depres- sion brought with it a realization of the need for immediate action. The result has been a great wave of cooperative marketing activity, the like of which has never before been witnessed in any country. Perhaps the most significant of the many cooperative movements, because it has apparently gone farthest in the shortest time, is that surrounding cotton. Cotton has been and still largely is a city man's crop. Cotton farming has been synonymous with poverty. It has retarded social and economic development in farm life. It has been at once the South's greatest asset and its greatest curse. While it 90 EEPORT OV THE NATIONAL AGRICtTLrURAL CONFERENCE. has added immeasurably to the Nation's wealth, the system under which cotton is grown and sold has kept the cotton farmer himself in a position where his own best effort's resulted merely in the ex- change of a, year's work for a canceled crop mortgage. In an attempt to solve some of the evil conditions of cotton mar- keting and thus to improve the economic condition of cotton farming the Oklahoma Cotton Growers' Association was formed in 1921. Founded on the Danish system of cooperative marketing and on the successful methods of some of the Pacific coast organizations, the Oklahoma plan for cotton, first put on paper 18 months ago, has spread over the South like a prairie fire on the heels of a strong wind. Cotton marketing associations are to-day doing business in four States — Oklahoma, Texas, Mississippi, and Arizona. Huge organi- zations are formed and ready to go in Arkansas and North Carolina. Organization work is well under way in Georgia and South Carolina and a firm toe hold has been secured in Alabama, Tennessee and Louisiana. No other State is important in cotton production. These organizations are all alike in both form and substance. Their principles include long-term, ironclad contracts with the grower, covering all of the crop produced. They are based on the principle of organization by commodity and not by locality. They provide a penalty for nondelivery of the product. They have adopted the principle of the internal pool, whereby every grower receives exactly the same price for the same quantity and quality, regardless of time of delivery or of sale. They provide for the employment of experts in cotton marketing who shall grade, class, and sell the product of the farmer for his benefit, and who shall work with him instead of against him in the cotton markets of the world. In order to secure stability, size, and volume of business these organizations are formed on the largest legal limit, which is the State itself, and the State organizations are correlated in a national overhead agency, known as the American Cotton Growers' Exchange, in such a way as to cooperate fully and completely with the laws of both State and Nation. These organizations, even in the short period of their existence, have demonstrated a number of vital facts about cooperative marketing. First. They have proved that average farmers will sign and abide by long-term, ironclad contracts. More than 125,000 cotton farmers have already signed these contracts. Second. They have proved that such organizations can be financed on a basis of commodity collateral for the purpose of orderly sale. The four State associations now doing business have actually bor- rowed within the last five months upwards of $20,000,000 and have used these sums to make advances to grower members pending the sale of their cotton. The War Finance Corporation has been the greatest single aid in this respect, and too much can not be said of the cordial spirit of cooperation shown by the directors of that corpora- tion. In addition to war finance funds, however, many millions of dollars have been borrowed from both city and country banks, and all such debts are being paid when due. Third. They have demonstrated that expert service can be per- formed by the employees of farmers' organizations just as well as by those of private corporations. The four State associations now active KEPOET OF THE NATIONAL, AGRICtTLTUEAL CONFERENCE. 91 are handling more than $50,000,000 worth of cotton this season and are doing it eificiently, sanely, and on a basis of the approved prin- ciples of city business. They have eliminated waste, inefficiency, and speculation at country markets. They have reduced the so-called city crop to a minimum. They have practically eliminated country damage through a system of prompt warehousing, and other dam- age through blanket insurance. They have substituted knowledge for ignorance in the dealings of the farmers with the buyers of the cotton. No figures can be given of a final nature, since ultimate returns to farmers are based on the season's average price less the season's average expense. Thus far, however, the four State organizations appear to have thoroughly justified their existence. The Mississippi and Ari- zona long-staple organizations have consistently sold cotton at from $10 to $25 a bale above country market prices. The Oklahoma and Texas short-staple associations, whose cotton is of lower value, have developed a differential of from $5 to $10 a bale, the first 28,000 bales sold in Oklahoma, as attested by the United States Bureau of Markets itself, showing an average margin over country prices of $7.65 a bale, exclusive of waste, country damage, and undergrading. In other words, these organizations are apparently well on the way toward becoming permanent institutions in the South. At least eight State associations with a minimum sign up of more than 2,000,000 bales of cotton will be in business for the season of 1922, and there is every prospect that the States now doing business will handle more cotton next year than this. It should be distinctly understood that these marketing organiza- tions are not believed to be panaceas for all agricultural ills. Neither are they designed to hold the product off the market with the thought of influencing prices regardless of the law of supply and demand. They are specific associations for orderly marketing and for shorten- ing the route between producer and spinner. They declare no war on anybody. They are in search of the high dollar for cotton. They are working in thorough harmony with a large percentage of the big cotton exporters and brokers. They believe that farmers have the right to engage in any busi- ness, but that they have no moral or economic right to engage in business unless they can perform their necessary services more effi- ciently or at less cost, or both, than those who now handle the processes of distribution in the cotton trade. On such a basis their presence in the field of cotton marketing is one of sheer business competition as cotton merchants with other existing cotton mer- chants. On their ability to survive competition will rest the entire success of the movement. The real purpose behind these organizations is not merely more money for cotton to the grower thereof. That is a means to an end. The end that is sought is an improvement in the standard of living of the cotton South. More money to the grower of cotton means glass windows in the houses, more conveniences in the home, more and better tools for cotton culture, better clothes for the family, schools for the children that will average up with other farming regions, a larger buying power for the South and a greater realization of citi- zenship on the part of southern farmers and their families. All these things follow in the wake of farm prosperity, and it is for these things that the Oklahoma plan of cotton marketing came to life. 92 REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. GRAIN MARKETING. By Robert McDougal, of Illinois. Eecently published Government" figures disclose that the present value of farm properties in the United States approximates $78,000,- 000,000. In 1901 the then statistician of the Department of Agricul- ture published in a leading American periodical a statement that the then value of farms of our country had attained the prodigious sum of $16,000,000,000. The increase for the 20 years is fabulous and in- credible on any other authority than the Government itself. We are met here in the time of a price recession such as our country has seen but a few times in 100 years. We are in the midst of an economic depression, the most serious the world has seen, following a war the greatest the world has known. And we are here to consider not what temporary makeshifts, but what fundamental changes, if any, are needed in our institutions and policies to bring .about perma- nently better conditions. Old methods and policies will be challenged. New methods and policies will be proposed. Some proposals will have merit. Some will doubtless be fraught with danger. Let us be wise enough to accept all that is sound in the new proposals and at the same time hold fast that which is good in the old institutions. I realize, as you do, that the grain trade has been considered in all times and in all countries a matter of grave public concern. The Chi- cago Board of Trade is an old institution which I am proud to repre- sent before this conference. In our long experience in grain market- ing we have learned that you can not separate the marketing problem from the production problem. Hence we are interested in both. We know as an absolute certainty that if the growers of the grain prosper we can prosper with them ; but if the growers of the grain suffer, we suffer with them. Hence we are interested in a better and more pros- perous production system. The Government figures tell us that the average farmer raises but 27 bushels of corn to the acre, which does not mean prosperity for the average farmer. Neither is it efficient production from the stand- point from the country at large. The average wheat farmer is pro- ducing only 14 bushels per acre, which does not indicate either prosperity or efficiency. It is the man who is above these averages — and these are low averages — who is prospering as a. producer. We agree with a statement of the Hon. H. C. Taylor, now Chief of the United States Bureau of Markets, who has recently expressed his belief that "90 per cent of what the farmer can now do to im- prove his marketing situation consists in adjusting his production to the demands of the market." Economic laws, particularly the law of supply and demand, like other natural laws, can not be con- trolled by statute. In the very short space of time at my disposal I can touch but briefly on the part the board of trade has played in solving our pro- duction and marketing problems. Omitting many things of fun- damental importance, therefore, and putting before this conference those things which are of more immediate concern to you, I will limit my discussion of the attitude of the board of trade toward the four matters of (1) production, (2) the cooperative elevator, (3) the farm-bureau movement, (4) the marketing of the grain. EEPORT OF THE WATIOITAr, AGRICULTURAL CONFERENCE. 93 1. Production and a 'permanent agriculture. — We favor a scien- tific agriculture, based on a 50-year program, rather than on any hand-to-mouth adjustment to meet temporary troubles. We are in- terested in a permanent agriculture in the best sense of the term. Such a permanent agriculture is based on soil maintenance and on crop production. And quantity and quality crop production is based primarily on crop rotation and seed selection. And in this field of production the board of trade, following a policy of enlight- ened self-interest, has done a notable work. Our Federal Depart- ment of Agriculture and our 48 State colleges of agriculture, now the best in the world, have laid and are laying solid foundations for an enduring agriculture, for better production, by spreading the message of better live stock and better varieties of grain. We have cooperated in this gaod work and helped put across the message. It IS only necessary to mention the many thousands of dollars we have put into the world's greatest agricultural exhibit, namely, the International Live Stock Show and the Grain and Hay Show. The cumulative effects of these exhibits in promoting better quality in live stock, hay, grain, and seeds is beyond calculation. We claim that our cooperation with agriculture in production is of real and substantial help both to the farmers and to ourselves. In short, it helps us prosper together, and both of us are benefited thereby. 2. Attitude of the board of trade toward the cooperative elevator movement. — The board of trade has played a very important part in promoting the rapid spread of cooperative elevators throughout the grain belt by maintaining an open market in which farmers' elevator companies might compete on equal terms with individual dealers and line elevator companies. It was the timely action of certain members of the Chicago Board of Trade that prevented the new and struggling farmers'^ elevators, some 20 years ago, from being entirely snuffed out by a combination of so-called regular dealers." Leaders of the farmers' elevator movement in Iowa, Illi- nois, Nebraska, and elsewhere are aware of these facts, even if the general public is not. Now 56 per cent of all grain received at Chi- cago comes from farmers' elevators. The largest cooperative ele- vator company in North America has a membership on the Chicago Board of Trade and does a heavy hedging business in this market. (I refer to the United Grain Growers of Canada, whose export com- ply holds a membership in the name of President T. A. Crerar.) The attitude of the board of trade is that those country elevators which are most efficient, whether farmers' elevators or independent elevators, should get the business, and will in the end get the busi- ness. Any company of sound character and good financial stand- ing can secure membership privileges in the board of trade if it will agree to obey the rules. 3. Attitude of the hoard of trade toward the Farm Bureau move- ment. — The board of trade looks on the Farm Bureau movement as the greatest forward step taken by American agriculture in the last 40 years. The board of trade helped start this movement and feels •considerable pride in its rapid growth to power. The first Farm Bureau in the United States, Broome County, N. Y., recently cele- brated its tenth birthday, and the speaker of the day pointed out how the financial cooperation of the Chicago Board of Trade with the 94 BEPORT OF THE NATIONAl, AGRICULTURAL CONFERENCE. agricultural and other local interests initiated this movement suc- cessfully and put it on its feet. In this way the crop-improvement committee of the board of trade was a sort of grandfather to the Farm Bureau movement. A cash grant of $1,000 was made to each of the first 100 farm bureaus formed, beginning with the one in New York State and spreading to Iowa and other Middle Western States. The board of trade took no part in controlling the Farm Bureau, shaping its policies, or keeping any strings tied to it of any kind. I point with pleasure to this Farm Bureau movement, not so much because of our financial investment in it but because of the vision which was back of our activities. We know that we have among our membership agricultural statesmen of the highest ability who may be counted on to see those things and to do those things which will make for a better and more profitable agriculture. Our hope is now that the Farm Bureau movement, local. State, and national, may have leadership equal to their great responsibilities and worthy of the great trust reposed in them. 4. Service of the hoard, of trade in grain marketing. — For more than 60 years, through panic, through wars, through good times and through bad, the board of trade has maintained a constant market, open every business day of the year. In the face of competition from the near-by terminal markets and the rapidly growing grain-using industries at interior points, Chicago is still receiving some 400,000,000 bushels of grain a year. This makes this market easily the largest grain market in the world. We claim that grain is now handled through the Chicago Board of Trade and the organized grain exchanges at a lower "middleman's toll " than is handled any other agricultural product. This is due to the use of future trading. And future trading makes hedging pos-. sible. And hedging is the means whereby handlers of grain insure themselves against price changes and hence can and do work on the lowest margins of any middleman. The commission for handling cash grain is 1 per cent. The cost of buying and selling for future delivery is one-fourth of a cent a bushel. The board of trade makes use of the force called speculation by harnessing it, putting it to work under definite and known rules. It is therefore the speculator, the willing risk taker, who makes hedgin>,he\7 are in doubt as to what their compensation will be, or if they are not certain that there is going to be a government which will protect their property and their lives, and the lives of those dependent upon them. Now, those things can only be settled by the participation of this country in the settlements, I do not care what others may think. We were engaged in the war to help win it. We should not shrink the responsibilities of restoring peace. That is not a criticism on our President or on our Congress. As I said in the beginning, I for one have come here to state what I believe to be the truth, and I am talking to this instrument here and to you, not in criticism of our Government, but as a suggestion, as a humble suggestion to the Government. They are going to have a meeting over there in Genoa, a conference. A meeting of whom ? Germany, France, Russia, England, Italy, and others. A meeting of our debtors, if you please. They owe us $10,000,000^)00. I believe that Uncle Sam should be represented there, and if I had that much coming and if you had that rnuch coming from a bunch of debtors, and those fellows were holding a meeting you would go in and ask them what they proposed to do about it. And we owe it to those people to say what we are going to do with that ten billion. We can not stabilize exchange while that thing hangs in the air, and they can not purchase from us until their money is worth some- thing. We should tell them, and tell them immediately, whether or not we expect them to pay that ten billion. Personally, I would REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. 99 make that conditional. I would say to them : " Here, you will either pay that ten billion or you will quit your fighting and go to work." So I believe that Uncle Sam should be represented at the Genoa conference. Again, we have been told by leading economists and also by Sec- retary of Commerce, Mr. Hoover, and his commission, that Europe can not be rehabilitated unless Germany is put on its feet, and that Germany can not be placed on its feet commercially or economically speaking until, she has been told what her reparations will be. There is a commission appointed for the purpose of determining the reparations, the amount of time in which to pay. A seat has been reserved for our Nation, and I believe that we should accept the invitation to participate by appointing a representative of the Reparation Commission. Now, gentlemen, these, I believe, are absolutely essential in the solution of our problems. We shipped 440,000,000 bushels of all kinds of grain to Europe last year. The amount that we receive for that grain is the determining element in the amount that we receive for grain here at home, because it is the exportable surplus that ultimately determines the price. Let us participate in the economic rehabilitation of Europe because in no other way can our economic difficulties be solved in this country, and because we owe it to the world, after having participated in that war, to assist in the establishment of permanent peace. I thank you. THE NEED OF A EOOD SUPPLY FOE AN INCBEASING POPULATION. By Dr. E. D. Ball, of the United States Department of Agriculture. We have listened to the recital of the serious troubles that have befallen the agricultural industry in the different sections of the United States. It has been impressed upon us that this situation was not confined to the producer alone but the same conditions prevail in all the industries allied to agriculture. In fact the evidence is over- whelming of a serious national and international situation. That agriculture received the first and worst effects of this condi- tion is practically conceded by all, as is illustrated by the amount of time and attention that have been given to the subject of the agri- cultural situation by every agency of the Government. Congress authorized a most exhaustive investigation of this situation and the two reports of the joint committee n6w before, you will long be models of thoroughness of investigation and clarity and brevity of presentation. If the problems of the immediate present were all that were before this convention, an indorsement of the conclusions of this commission together with the working out of plans for putting them in operation would accomplish its every purpose. There is, however, a future as well as a past to consider and here the pictjare brightens. American agriculture was the first to suffer in this world-wide cataclysm and will undoubtedly be the first to re- cover Already the situation has improved wonderfully in the cotton belt. Other regions are beginning to feel more hopeful and as time 100 EEPOKT OF THE NATIONAL AGRICULTURAL CONFERENCE. goes on we will undoubtedly turn our attention largely to the troubles of other industries as they in turn go through the trough of the de- pression. The experiences of the past year, though dearly bought, may in the end prove to be a blessing to agriculture. They will be more than a blessing — they will be an endowment — if out of this experience the farming industry becomes generally recognized as the foundation of national prosperity; if commerce and industry come to an abiding realization of the fact that it is only out of the surpluses of produc- tion that their workers are fed — -that the producers eat at the first table and the wage earners at the last ; if out of this crisis agriculture obtains the favorable legislation that it has long needed to enable it to function properly and efficiently; if out of adversity come com- prehensive stable and efficient organizations of preducers, and it is only out of adversity that such organizations have been builded in the past. Farming is an occupation that requiree independence and self-reliance. No other type of man can succeed, but these same char- acters make it very difficult to bring about cooperation. Sudden ad- versity may bring them together but only continued adversity can weld them so closely that returning prosperity will not loosen the bond. To summarize: If out of this situation the farmer of the future obtains recognition, legislation, and organization, he will in the end have profited by the experience. It will indeed have been a high price to pay but history in general, and that of our own country in par- ticular, has shown that liberty and justice have been purchased at the price of much suffering, privation, and bloodshed. The problem before the American Nation to-day is, however, not only of the immediate present but of the immediate future, and if we are wise, even more of the decades to come. No nation can be successful that does not plan in advance, that does not anticipate its problems and thus avoid many of the disasters that would otherwise occur. If more planning had been done in the past the present situa- tion might have been largely averted; in fact many phases of it might have been turned to advantage and resulted in permanent ex- pansion and development rather than in the present contraction and stagnation. But organized agriculture did not look ahead. In fact, agriculture was not organized for that purpose or for any other pur- pose, so the best that we can do now is to work our way out of the present situation and plan for the future. Time has always been one of the great factors in righting world conditions. Just how long that time will be, no one at the present time is willing to prophesy but all are willing to concede that the change will come. Humanity has always had faith in the future and that faith has never failed. If some one possessed the magic wand that Chairman Anderson suggested and could restore the world to a normal condition we would suddenly be confronted with the fact that there is no over- production ; that what the world is suffering from is underconsump- tion. There is not enough food in the world at present to provide for the inhabitants. If buying power could be restored to-morrow, the surpluses would almost instantly disappear. If we study our own national situation carefully we will find many encouraging things from the standpoint of the present situation but SSPOKT OF THE JTATSONAL AGEICULTXJEAL, CONFERENCE, 101 almost equally discouraging from the standpoint of the future. Our Nation has just passed its three hundredth birthday, an infant in age beside the other nations of the earth. If we will glance back into our history we will find that in 1790, at the time of the first census of the newly formed Republic, we had less than 3,000,000 people; that in 1820, at the close of the second century after our foundation, we had less than 10,000,000 population; while in the century just passed we have increased almost 100,000,000 as against the 10,000,000 of the two centuries before. If we study the history of this remarkable increase as compared with our slower increase in previous times and the still slower in- crease of many other nations of the earth, we shall soon find that the reason is best portrayed in the accompanying map which shows the production of food and raw materials distributed by States. A glance at this map will show you that the New England States, our colonial home, had but a meager production in the paet as it has at the present time; that it was only when the canals and railroads had been constructed and the territory to the west of the AUeghenies had been opened up that the Nation began to develop. It was not in fact until the period following the Civil War, when the Nation gave to every returning soldier 160 acres of land and made easy provisions for others to acquire similar amounts, that the great 'development of the Mississippi Valley, from Ohio and Ken- tucky westward, to the Dakotas and Texas, took place. The south- ern region produces our excess of cotton ; the upper Mississippi Val- ley, nearly all of the excess of food. It was then that food of all kinds, as well as raw materials, became excessively abundant and relatively cheap. Manufacturing industries responded to this and took on a new impetus and our Nation increased rapidly in popula- tion, wealth, and power. No wonder that with this vast addition we became very com- placent as a Nation and were rather boastful of our accomplishment. In the 60 years following the Civil War we increased our cotton pro- duction five times, our wheat production four times, our corn produc- tion three times, while our population only increased two and three- fourths times. No wonder that when the Secretary of Agriculture stated that the United States produced 25 per cent of the wheat, 60 per cent of the cotton, and 75 per cent of the corn of the world, with only one- sixth of its population, the Nation should feel it was on a firm foun- dation and its future prosperity assured. But in all this we are talking largely in the past tense. The peak of agricultural production per capita of population was passed in 1898, nearly a quarter of a century ago. Agricultural production almost kept pace with population increase for some little time after that date, but in the last decade it has been steadily and evermore rapidly falling. Probably this can be more concretely shown by the definite state- ment that the cotton production has fallen in a decade from 14,000,000 bales to less than 12,000,000 bales. Corn production reached its peak a decade ago and has remained practically stationary ever since. The 1920 acreage of 104,000,000, exactly the same as it was in 1910. The 1920 crop was larger, however, due to an exceptionally favor- 102 REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. able fall. This year's crop was smaller in both aareage and produc- tion. Wheat production would no doubt be even worse if it had not been for the fact of the great war drive and the remarkable advance in the selling price of this cash crop. The combination, however, only forced it up temporarily and it has dropped back to almost its prewar average. In brief, the food production of this last decade has been almost stationary while the population of this country has increased approximately. 14,000,000. It is true, of course, that there has been a greater diversification in crops and in food requirements, but these do not materially affect the basic facts. There seems to be no escaping the conclusion that the larger areas of the rich' fertile, and easily tilled land of this country were mostly taken up a generation ago and that the increase in farm area in the future will be relatively slow. There will be increased acreage in the now cultivated area. There will still be small areas in which the frost hazard *is great, other areas when the drought hazard is the limiting factor, and still other areas in which excessive costs of irri- gation or drainage will have to be met. In all of these lands the cost of production will be higher than it has been on the lands al- ready taken up and their utilization will for the most part be de- layed until continued food shortage has forced prices above the present ratios. Statisticians have estimated that our population at the close of this century will be more than 220,000,000 and have placed the probable time in which we shall begin to import the staple foods at from 15 to 30 or more ypars. Even if it should turn out to be the longer period, it is time we were considering the problem not only from the national standpoint but from its effect on agriculture. The real situation is, however, much more critical than those esti- mates would indicate. The United States is to-day a food-importing Nation, measured in dollars — that is, we import more sugars, tea, coffee, spices, nuts, and tropical fruits than we export of wheat and meat. Most- of these we have always imported and always will. Sugar .we can produce or not^ as we choose, but the Nation is rapidly coming to a condition in which the food balance is going to be defi- nitely against us unless it is made one of the major problems for national consideration. That does not mean that under the stimulus of excessive buying and the combination of favorable conditions there might not again de- velop periodic surpluses. That is inevitable as long as the volume of production is subject to the hazardous influence of climatic condi- tions, pests, disease, and other factors over which a man exercises little or no control. Under conditions of alternate excesses and de- ficiencies, which will undoubtedly occur in the transition period, organization, standardization, and all development of more orderlv methods of marketing and distribution will have even more possi- bilities of usefulness than under present conditions. The problems of the immediate future, distressing as they may be, are, however, relatively simple as compared with those which will undoubtedly follow. The United States has been an excess food- producing Nation so long that 'few thinkers have until recently con- sidered the possibility of any other condition. We have come to look upon our rapid increase in population and our enormous increase in REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. 103 food production as a normal conditionj but a careful scrutiny of the situation will disclose an alarmingly different situation. What does this mean to the Nation? It means a reorganization of our entire national life. It means that the farmer's interest in foreign markets will have disappeared. It means that the price of wheat in Chicago will be the price of wheat in Liverpool plus the cost of moving it from Liverpool to Chicago — where now the price in Chicago is the price in Liverpool less the cost of moving it there. It means that manufacture and industry which have been moving westward toward the source of cheap and abundant food will begin to move back toward the Atlantic seaboard if the food must come from across the water. It means even more than that. As time goes on they will move to the surplus-producing nations, where more favorable conditions for their development can be found. What does it mean to the farmer 5 It means, first, higher prices for farm products, which would undoubtedly be welcomed, and for the first period beneficial, but it would inevitably result in an in- creased cost of living to the whole Nation, which would in turn react in raising the price of everything the farmer had to buy. As we are just passing through an experience of this kind, I feel certain that the farming population does not want a repetition. It means more than this. It means the rising cost of living would drive the manufacturer who had to compete with the foreign worker out of business and thus destroy the home market, which is, after all, the best and safest market for the producer. If the farmers of this Nation as a body could study the conditions of the producing popu- lation of the food-importing nations of the Old World, and could note what percentage of their toilers pass their last days in the work- house, they would want none of those conditions for America. During this period in which we became a truly great food-export- ing Nation we have grown as no other nation in history has ever grown. New York has jumped in that 100 years from a small town to the largest city in the world. Chicago, on the wave of that growth, developed in 50 years from the ashes of the fire of 1871 to the fourth city in the world. Remarkable! There is nothing like it in all history. It took London 20 centuries to . reach its present growth. Chicago has become a city of nearly 3,000,000 in 50 years. Chicago grew because she is the eastern gateway of that great food-producing area, and Chicago will continue to grow just so long as she is the gateway of an excess-food area, but the minute that the United States stops producing an excess of food everything that history has given us in regard to nations indicates that she will stop that growth. The question of whether Chicago — and when I say Chicago, I mean any city in the United States-^I mean the Nation — the question of whether Chicago in the next 100 years is going to be a city of 4,000,000 people or 10,000,000 depends on whether this Nation con- tinues to be an excess-food producer or drops back to the food-im- porting condition of the old countries. That we are going to become a food-importing nation unless we do something to prevent it is certain, and it is going to take a united effort. It is going to take a serious, aggressive policy with the back- ing of the whole American people behind it if we are to maintain our present condition. Do we want to or do we not ? 104 KBPORT OF THE NATIONAL AGRICULTUBAL, CONFEBENCE. There is another phase of the situation that can not be ignored. The population of the world is growing and will continue to grow. That civilized natjon which offers the greatest opportunity to the young and adventurous will grow the fastest. Do we want to be the nation that attracts the young and ambitious of other countries or do we wish to see our young men and women migrating to other fields? Before the war period thousands of our most ambitious young men and women from the farming communities were crossing the border into our sister country to the northward, there to establish permanent homes and assist in the development of their adopted land. The interests of the two countries are so nearly mutual that we have not considered that movement a loss, but if the day comes that migration is beyond the waters the problem will be acute and the solution difficult. We can only judge the future by the past, and if we will look at the history of other countries we will find that as soon as a nation passes from a surplus food-producer to an importing nation the rate of population increase is rapidly modified. If we will compare, for example, the rate of growth of the European nations during the last century we will find that the rate of increase in population has varied almost proportionately to the relative food supply; that the leading nations of Europe at the beginning of the last century, such as France, England, and Germany, had from three to six times the population of the United States ; but that at the end of the century the United States had nearly doubled their average. In fact the only country of Europe whose population increase was at all comparable to that of the United States was the one surplus- food producing country, Russia. If we further compare the relative progress in the food- importing" nations of Europe we will find that Germany, the one country which spent a large amount of money in the scientific development of agriculture and industry, increased her food supply and also increased her population, her wealth and power far more rapidly than any other country. A national policy of development should consider every factor bearing upon our national life and our national relations with other civilizations. The history of the world has shown the transfer of leadership from nation to nation throughout the centuries. Gil Fillan in the Political Science Quarterly traces the movement of civilization and world leadership with reference to the mean tempera- ture of the countries concerned. There are many interesting and instructive things to be gleaned from this discussion and chart. First, world supremacy has always been in the Northern Hemi- sphere. Second, it has in the 54 centuries charted been moving rather steadily toward cooler temperatures. This has undoubtedly been largely the result of the development of industry enabling the human race to thrive in regions in which primitive people without clothing or heated habitations could not have existed. That the tendency seems to be continuing with practically the same rapidity is also significant and may possibly be correlated with an as yet unpublished factor showing that the highest production of almost any given crop in our hemisphere occurs near the northern limit of its adaptation. This chart indicates that the United States is exceptionally favorably located with reference to world leadership REPORT OF THE NATrONAl, AGRICULTURAL, CONFERENCE. 105 at this time shared almost equally, however, with England, France, and Germany. No great center of world leadership has ever de- veloped in. the Southern Hemisphere, and if the progress of civiliza- don is going to be toward the colder regions, the possibilitv in the Southern Hemisphere is very limited because the land areas (diminish rapidly in that direction.- The United States possesses many natural advantages over the other nations mentioned and if she wishes she may continue to increase her preponderance in power and influence until her position of international leadership will be unquestioned. Before discussing the concrete problems of policy it might be well to consider briefly the fundamental biologic law, that there is no standing still in nature ; that organized existence has only two definite stages, growth and decay. This is as true of animals and plants as it is of man, and so far as history has shown it is as true of social organizations as it is of the individual. It has also been shown that the more favorable the conditions, the longer growth may be con- tinued and decay is retarded. In physical stature there are pretty sharp limitations to growth. In mental development these limitations are much less rigid. The social organization probably corresponds more nearly to the mental rather than to the physical attributes of man. The gi-eat majority of men mature early mentally and from that time on gradually lose ground with the progress of the race. Others continue their develop- ment for long periods, practically indefinitely in fact, within the con- fines of physical limitations. There is no reason why a nation should not continue to develop in the same way. Growth is natural and easy in the early stages and under favorable environment, but there always comes a period in which these favorable conditions are balanced by unfavorable ones and then further development must come from continued construc- tive effort on the part of the individuals or of the nation involved. The United States has partly by virtue of her wonderful develop- ment in the past century and partly by the accident of the war come to hold a commanding position in the councils of the world. This was not of her seeking nor of our desire, but it is an obligation that can not be shifted at this time. Some nation will continue to domi- nate to a large extent in the constructive progress of the world. It is tremendously important to the world that that nation should be a democracy. America can be that nation if she continues to grow and develop. Power and influence will inevitably gravitate to some other nation if she does not. It is for this Nation as a whole to decide. It is, however, largely for the farmers of this Nation to determine whether this shall be the Nation of progress and achievement, because national progress in the future must rest even more squarely back on the food-producing power than it has in the past. The critical period in which a determination must be made is close at hand. If this Nation wants to go on increasing in power and influence as she has in the century past she must weigh every factor in the problem of permanent development to be presented by the speakers to follow. She must develop her forest resources, utilize her remaining land for the Nation's good, and subsidize research. She must weld their recommendations together into a constructive program of na- tional unity and take steps to put them into immediate operation. 106 KEPOET OF THE NATIONAL AGRICULTUEAL OONFEEENCE. This conference is the most truly national representation of all phases of agriculture and its allied interests that has ever been brought together. If out of its combined wisdom in deliberation there shall come, along with measures for the relief of the present situation,, a ringing declaration of faith in our national future and the outline of a policy of development founded on a self-sustaining agriculture that will make that faith secure, this convention may be as epoch making in a constructive way as the situation that called it together has been in a destructive one. A NATIONAL FOBESTKY POI.ICY. By GiFFOBD PiNCHOT, of Pennsylvania. I suppose before I begin to discuss this forest question it would be fair for me to justify my appearance before a body of farmers. I am a good deal like the Irishman in the old song : " My father, he died and he made me a farmer ; he left me a cow and an acre of land." I have got a cow and an acre of land; and that might justify me in coniing before you, but I think there is another reason. I have known a good many men who were of use to the farming community of the United States who were not dirt farmers. Your chairman has just referred to one with whom I had a speaking acquaintance, the man who started the whole modern farm movement in the United States — Theodore Eoosevelt. I had a deep affection and have still for another, although he has passed to the other side, the father of our present Secretary of Agriculture, Uncle Henry Wallace, and even Tama Jim Wilson. The greatest of the predeces- sors of our present Secretary was not acting as a dirt farmer when he rendered his tremendous service to the farm people of the United States. And for that matter there is a group of men up here on the hill, mostly not farmers, who have earned the everlasting gratitude of every farmer in the United States and of everybody else, too, be- cause who helps the farmer helps all the people. Now, the farmer as a class is the greatest user of wood in our coun- try. Half of all the timber that is consumed in the United States is consumed on the farm, and you can not farm without wood. We seldom stop to think how completely the use of wood is necessary to every industry, and especially to the farmer. The farm buildino-s in the United States are worth $11,500,000, and nearly all of them are wood, and at every point the farmer must have wood to do his busi- ness. No wood on the farm, no food in the towns ! One of the two or three essential requirements for the conduct of the food producing industry and the clothes producing industry in the United States is plenty of wood. The further you follow this question down, the more you find that our civilization is absolutely dependent on wood. You can not eat a meal and never have that did not require wood for its production. You can not wear an arti- cle of clothing and never have that did not require wood for its pro- duction. There never was a concrete or a brick house or steel office building that could have been constructed or was constructed without the help of the forest. REPOKT OP THE NATIONAL AGRICULTURAL CONFERENCE. 107 As a matter of fact, there has not been on this earth, and so far as we can tell, there never will be, a single human being who ever lived out his life without the help of the tree. Wood is one of the two or three absolutely essential things in our civilization, and we have got to have it or go out of business. You can not wash a shirt without wood even, for there has to be rosin in the soap. Let me take just a moment as an illustration to follow through some common article of food and see how wood comes in at every point in its production. Take, for example, a beefsteak. Now, I have eaten beefsteaks that seemed to me to be wooden, but that is not the point. Well, say that you want a steak for dinner, let us follow the history of that steak down through; Say it began out on the plains of Montana. A little calf was born and there was not a tree in sight when that calf was born. Along comes a round-up; to brand a calf they have a wooden wagon in which they keep their grub and clothes, and the cow-punchers are riding on saddles with wooden trees. They build a fire of wood, for there are not any more buffalo chips, to warm the branding irons. Then off goes the round- up and they come back three years later, gathering up the beef steers ; they pick up the three-year-old steer and take him to the railroad; there he goes into a wooden corral, into a wooden chute, into a wooden palace stock car; in that stock car he is hauled over wooden railroad ties, by an engine built of steel, every pound of which steel required wood in its production, with steam made by coal and water or oil and water, and every gallon of oil and every pound of coal took wood. Why, in Pennsylvania we put twice the total production of wood of the whole State into the anthracite mines alone every year. And when that feeder goes to Nebraska to be corn fed, he goes into a wooden feed lot, and eats his corn out of a wooden trough, and the corn was produced in a field fenced with wood, and the argicultural implements required wood, and the wagon that hauled it in was made of wood. You could not fatten your steer without the use of wood, and when he is fat he ,is hauled to Chicago in a wooden stock car and over wooden railroad ties, and there he goes on a wooden killing floor and they kill him with a mallet that has a wooden handle. They cut him up with a knife with a wooden handle, and part of him goes into cornbeef in a wooden barrel. Your steak goes into a wooden re- frigerator car with wooden strips on the floor, comes to your town over wooden railroad ties, is dumped on a wooden platform and loaded into a wood wagon (unless the butcher is rich enough to have a flivver, and then the tires are made of rubber that comes out of a tree). The butcher, anyhow, gets the steak and puts it into his ice- box, and that is built of wood. Along comes your wife or else she telephones over a telephone line that is strung on wooden poles ; the butcher brings the steak out of his wooden refrigerator, lays it on his wooden chopping block, takes a knife with a wooden handle and a saw with a wooden handle, and cuts off your steak, but before he sends it home he takes a wooden skewer to put your name on it, puts it in a wooden basket, and sends it in his wooden delivery wagon to your house. When it gets there you wife takes it into the kitchen, takes a news- Daper made of wood, and puts it into the stove with some wooden 108 KEPORT OF THE NATIONAL AGRICTJLTURALi CONFERENCE. kindling and some coal that used to be wood, scratches a wooden match, lights a fire and cooks your steak. When it is done, walking in shoes that were tanned with thfe bark of a tree and on a wooden floor, she puts your steak on a wooden table ; you sit in a wooden chair and eat the steak, you wash it down with coffee that is made of a berry that grew on a tree and water that came out of the woods, and when you are through you pick your teeth with a wooden toothpick. Now, you can tell that kind of a story about any other thing in your house. You can not get away from wood. We have got to havb wood. It is a perfectly fair thing to say that if there was no forest on the hillside there would be no food on the table, no clothes on the body, and no roof overhead. If that is true, then the question of where we are going to get our supply of wood in the United States is one of the big farm questions and one of the greatest of all the general economic questions that confront these people. Now, the fact of the situation in the United States is this. We have already destroyed five-sixths of the original forests in America. The one-sixth which remains is being cut at a rate that would take it all in the next 25 years. We have already destroyed and put out of business, so far as production is concerned, a big area of forest land in the United States, and made it into a man-made desert that is producing practically nothing for the benefit of the people of this country. We have already succeeded in producing out of what was once productive forest land, a man-made desert larger than all the forests of all Europe except Russia and Scandinavia. And we are adding to that man-made desert every year at a rate as large as all the land there is within the boundaries of the State of Connecticut, and some times a good deal more. In other words, we are facing in the United States directly, if we go on as we are going now, certain exhaustion o'f this one most gen- erally used material of our civilization, one thing without which we can not live, without which our people can not earn their living. Well, suppose we are? Why not go to the rest of the world and get from them at, of course, a slightly higher price, the lumber that we can not produce at home? The unfortunate and the critically important fact in that connection is that all of the great civilized nations of the world, with very few exceptions, are in almost pre- cisely the same situation that We are. Germany, we have often thoif^ht of, for example, as the nation that was doing the best by its forests, but Germany has been unable to supply the needs of her own people since 1870. England, France, Italy, Portugal, Spain, Holland, Belgium, Turkey, Greece, Serbia are all timber-importing countries. So are China, India, Australia, and South Africa. Brazil, in spite of the fact that it has a million square miles of tropical forests, imports half of all the lumber that she uses for the reason not only that that vast area is unexplorable, but because of the fact that the timbers of which it is composed are not the kind of wood upon which modern civilization is built, for modern civilization is built mainly not of the hardwoods, but of the softwoods. Hardwoods are necessary, too, but the main thing is that softwoods are essential for construction purposes. Even Mexico at our door to-day, to which we often think of turn- ing for a supply, is an importer of timber, and if the Canadians BEPORT OF THE NATIONAL AGRICULTTJEAL CONFEEENCE. 109 should give us all they have, and it needs no seventh son of a seventh son to realize that they are not going to do it, and we would not do it if we were in their place ; if they should give us all that they had it would not keep us going for 20 years. For you must remember, and it is a pretty striking fact, that although we have only about one-twentieth of the population of the globe, half of all the sawed timber consumed on this old earth of ours is used right here in the United States. Our consumption is tremendous. The demands that we make upon our forests are gigantic. Our whole civilization, our farmers, our manufacturers, our transportation, and all the rest of it are based on the kind or use of wood that we become accustomed to, and the lack of it would mean, if we allow it to come, such a convulsion in our industry and our agriculture as I, for one, hope most devoutly that this country would be spared. Now, what can we do about it? The essential fact in the forest situation is this : We are facing a serious shortage of this material. When our own forests are gone we can not supply it to any consid- erable extent from abroad. Even Siberia, however much timber it will have, will find a complete market for everything it can produce in the vast populations of China at one end and Europe at the other, and Siberia will have nothing for us. We have got to raise what wood we need or go without. That is the essential fact in the situation. Of what forests we have left this is the condition. About one- fourth of our forests are yet in the Gov- ernment's hands, almost entirely national, well handled on the whole, fairly protected from fire, but it can never produce more than 20 per cent of what we need. We have on the whole forest area enough to just about supply our needs at the rate of consumption that is going on now, provided that forest area were producing every year 60 cubic feet of wood per acre. Instead of that it is producing only 15 cubic feet per acre. Another 25 per cent of our forests is in farm wood lots, or a little more. Now, the wood lots of the farmers, except for the national forests, are the safest part of our forest inheritance. We have now about 170,000,000 acres of forest land in farms. It is not producing as much as it should. It is not being handled as well as it might be, and yet, so far as the farmers wood lots are concerned, there is practi- cally no danger of forest devastation. Then, as to the remaining of the three great classes of our timber, the timber that is in the hands of commercial owners, the timber that is in the hands of the lumberman. That timber comprises about three- fourths of all the standing stumpage in the United States, and with the utilization of smaller sizes of trees, the private timberlands in the United States are to-day being destroyed more rapidly and more completely than ever before. That is the danger. It is upon these lands that the devastation is going on, and to-day there are from three to four millions of acres of land, good for nothing else, that used to grow trees, and is a matter of practical production no longer. If we are to continue to use wood in this country, our national for- ests being safe, our farm wood lots being reasonably safe, the one and only possible point of attack is to stop the devastation of forests 110 REPORT OF THE NATIONAL AGEICXJLTURAL CONFERENCE. where that' devastation is going on, and that is on commercially- owned timberlands of the United States. There is the first point of a sound forest policy. Now, I recognize, and nobody can recognize it more clearly than I do, that protection against forest fires is absolutely essential. I have the honor to be State forester of Pennsylvania, and I am very proud to be able to report to you that the last legislature of Pennsylvania made a larger appropriation for protection against forest fires than the legislature of any other State had ever made before. I see, I think, as clearly as any man can the absolute necessity for forest pro- tection. I see the necessity for replanting, but where you have an area three or four times as large as Pennsylvania or Iowa to replant, replanting will be excessively costly and excessively slow. I recog- nize the absolute necessity for increasing the national forests and the public forests" generally, but I recognize also that if we were to at- tempt to buy forest lands sufficient to meet the gigantic needs of our population, the price would rise into billions of dollars and for the present at least would be absolutely prohibited. All these things help; the adjustment of taxation helps; many other minor remedies are valuable, and every one of them should be used, but when all has been said and done the one measure most necessary is to stop the devastation where that devastation is going on. When your house is on fire the first thing you do is to put the fire out, and after that you begin to think about rejbuilding, and the first thing for us to do in forestry is to put our hands definitely, the hand of the great general public, definitely upon the devastation that is going on, and say : "Stop." Now, there is one feature of this situation that I want to impress upon you as strongly as I can. Forest destruction in the United States as it has been proceeding means an enormous increase in freight bills of the farmer. In my State of Pennsylvania we pay more than $25,000,000 every year and a good deal more for lumber shipped into the State that could just as. well have been grown there as not. Pennsylvania, New York, Iowa, Illinois, Nebraska, and, on the whole, 33 of our great States are unable to supply the timber to keep their own people earning their own living ; and there are now only 15 States, and within less than 10 years there will be only two or three, with forests enough to be able to export timber beyond their bounds. Now, I want to give to you this point as strongly as I can. It is not the man in the State wher^ timber is plentiful that is going to be the first man to suffer from the scarcity ; and, by the way, you farmers know what that scarcity has already done to you in the matter of raising the price of wood. It is a common saying that the farmer will be the last man to starve, so the man in the State which has plenty of timber will be the last man to feel that scarcity, while the great agricultural regions of the United States will be the first. In other words, what is done with the forests of Washington, Ore- gon, and California which to-day contain half of all the standing timber in the United States, is in a very real sense far more im- portant to the farmer in Iowa and the steel manufacturer in Penn- sylvania, to the silk mill man of Connecticut, than it is to the people who actually live under the shadow of the trees, because I want you to remember that while it takes wood to raise food on the farm, it REPORT OF THE BTATIOIirAL AGRICTILTUKAIj CONFERENCE. Ill takes a lot more wood after that food has been raised to put it into the hands of the ultimate consumer. The point I want to make is that this is a nation- wide question that can not be handled only by the men who own the lumber, or only be the men in whose States that lumber is. It is a question of a national supply and the Nation itself must take hold of this matter with a strong hand or within a very short time we shall feel a scarcity of timber that will make every one of us squirm, for do not forget that it takes only a fraction of a shortage in an absolutely necessary material to send the price of your materials scooting. And so the answer to our present problem in forestry is, first of all, this thing, that the people of the United States as a whole should take hold of this question vigorously and say to the men who are devastating these forest lands : " This devastation must stop." That is the remedy. Now, my friends, I have told you what I had to say. One other thing only. You farmers know that the forest is a crop. You know the growing of a forest, although the crop may take longer to mature, is a question of production from the soil. You know, there- fore, that the question of crop production of trees belongs where the question of crop production of all other crops also belongs — in the United States Department of Agriculture. The proposal to trans- fer the United States Forest Service from the Department of Agri- cuture to the Department of the Interior has not one single sound reason of any kind behind it. And the same is true of the Bureau of Markets. Both proposals are hostile to the interests of the farmers of the United States, and I hope you will see to it that they are stopped. A NATIONAL POLICY FOR LAND XTTILIZATION. By Dr. Kichabd T. Ely, of Wisconsin. INTKODTJCTION. The subject assigned to me is, you will all admit, a large one. It is a subject of urgent and immediate importance. Upon our measure of success in solving this problem depends, not solely, but largely, on our measure of success in achieving national prosperity and national welfare. On the other hand, in the measure that we fail we must in that measure fail in our efforts to maintain and improve the splendid heritage handed down to us by our fathers. Land utilization embraces, roughly speaking, the land problems of our times. Let me give two quotations to show what thoughtful men have said about the questions with which we are dealing — questions summed up in the words, the land question. First of all, let us listen to the words of a scholar, the well-known economist. Prof. Frank A. Fetter, of Princeton University. Prof. Fetter says: My own conviction has long been that the land question far transcends any restricted field of economics, and that it is fundamental to national survival and national welfare. It is truly a problem calling for statesmanship of the broadest type. 92640— H, Doc. 195, 67-2 8 112 REPORT OF THE NATIONAL AGRICULTXrEAL CONFERENCE. Let US turn from the scholar to the practical man of affairs, " The Empire Builder," the late James J. Hill. Mr. Hill says : Land without population is a wilderness and population without land is a mob. The United States has many social, political, and economic questions — some old, some new — to settle in the near future; but none so fundamental as the true relation of the land to the national life. The first act in the progress of any civilization Is to provide homes for those who desire to sit under their own vine and fig tree. A prosperous agricultural interest is to a nation what good digestion is -to a man. THE NEED OF, A LAND POLTOT. By policy we mean planning in order to reach desired ends. A national policy for land utilization means planning for desired ends with respect to the use of the land. It signifies that we ascertain what kinds of land we have and that we put each kind to its best use. The very fact that we use the term " land policy " signifies the inadequacy of laissez f aire. A land policy includes regulation for the preeent and the future of all those natural resources which we include under the term " land." This regulation means that we supplement individual- ism bv social control, and social control by land policy embraces, then, mose relations among men which arise out of land utilization. Social control, as the experience of the world demonstrates, becomes more intensive as time goes on, and that with an ever-increasing em- phasis upon social welfare ; but this control may proceed from private agencies as well as from public agencies. In the United States we have never had a real land policy. Our course of action has been happy-go-lucky. In other words, such a plan as we have had has been partial, incomplete. Our land settle- ment has not been based upon any well-thought-out principles. The Wakefield theory of settlement was advanced in the first half of the last century. Whether this theory was correct or incorrect, it was very carefully worked out and so far as applied in New Zealand and elsewhere it reached fairly satisfactory results. According to this theory a sufiicient price should be asked for new land to prevent an excessively rapid expansion to bring about a close, compact settlement of the land with a right combination of land, labor, and capital. This theory and other theories could have received, and, indeed, shoxild have received, careful consideration in the formulation of an American land policy, but we thought " Uncle Sam " rich enough to give us all a farm and we took as a standard for our homestead act the conditions of the Mississippi Valley, in which, generally speak- ing, 160 acres is a rich heritage and furnishes an adequate support for a desirable standard of living for the farmer. We now know, however, that there are parts of the country in which 160 acres is not large enough for decent starvation. We have clear demonstra- tion of the fact that what we need in a land policy is to take as our measure not physical area but the economic significance of the area ; in other words, satisfactory land settlement presupposes quality classification. It has already been said that a land policy means the determina- tion of ends that we desire and the adoption by appropriate means to reach the desired ends. We have not reached the ends that we desire. Even before the World War the situation was not satisfactory and the World War has made a bad situation still worse. BEPOBT OF THE NATIONAL AGBICTJLTUBAIj CONFERENCE. 113 We have the present crisis which requires attention, but a land policy is fundamental and far-reaching. A land policy can not be changed radically to fit any temporary emergency. It must reach across this and succeeding emergencies and make them less acute and alarming. _ Let us, however, give a few words to the present distressing situa- tion. Our farmers have not raised more food and raw material than the world needs or than the world under normal conditions could purchase and consume. The first fundamental fact in our situation is the destruction of a large proportion of the purchasing power of those who are normally our customers — the buyers particularly of our agricultural products. The poverty of Europe is the chief factor in the distress of American farmers and the consequent general dis- tress in our country. The populations of European countries are strong .and virile, and only the sheerest ignorance can think of Europe as decadent, but they are impoverished and they are discouraged. The trouble with our European customers is partly material, the result of the loss of life and the destruction of wealth, but of even more importance is that part of the trouble which is psychic— in other words, the state of mind. They feel disheartened. Hope seems to have abandoned them. In too many cases they feel that this greatest and richest coun- try in the world is cold and indifferent to their fate. in establishing a national policy for land utilization, at the present moment nothing is of more importance for the American farmer than revival of hope and courage upon the part of other nations of the world and particularly those in Europe. They have tremendous productive power and corresponding potential purchasing power. Let us lend them a helping hand ; let them feel that we are friendly toward all — Austria and Germany as well as France. We shall see then a revival of demand for the products of our American farms. Another feature of the existing distressing situation is found in the fact that the high prices of food products during the war_ led to abnormal uses of the land, and a return to normal conditions must necessarily involve distress. To this distress we are not indif- ferent, but it can be remedied only partially, as it results from social, economic, and natural laws. As" President Harding told us in his opening address, we have no magic word, no magic wand with which to work miracles; we achieved our purpose in the World War, and we think our victory worth the price — but the price must be paid. The area of crop land was greatly expanded during the war, the census showing an increase between 1910 and 1920 of 55,000,000 acres. This expansion was due in part to higher prices, but it was also due to the splendid response of the Anierican farmer to patri- otic motives. A large increase of production of the staple crops result-ed from this increased acreage. With the coming of peace the effective demand for agricultural products diminished, and as a consequence a large agricultural surplus developed. Pasture land decreased notably in acreage during the war, owing to the plowing up of the better pasture land for crops and reversion of some of the poorer pasture land to forest. Labor was concen- trated on the better lands. In the eastern half of the United States 114 EEPOKT OF THE NATIONAL, AGRICULTURAL CONFERENCE. the area of improved land was practically the same in 1920 as in 1910, while the ^rea in crops increased 34,000,000 acres, which must have come almost wholly from improved pasture. Much of this- pasture land which was 'plowed up for crops must now revert to pasture with the return to pre-war or even lower prices for farm products. Let us pass now from the present temporary situation, which be- fore long will belong to history, and consider the main outlines of the national policy for land utilization. Do not expect any panacea ; there is none outside the disordered phantasies of cranks. If the program is complex it is because life, individual and social, is com- plex. The kind of world we live in knows no short cut to general prosperity. No land policy is worthy of a moment's consideration that is not based upon the classification of land. Let us place, therefore, first of all, land classification. Call to mind the most general statements that you hear about land and ask yourself the question. To what extent does this apply to all kinds of land? We hear a great deal about conservation, but not too much about conservation, so far as what we hear is sense and not nonsense. If you think about it you will see that a policy of conservation as applied to agricultural land does not apply to forest land or mineral land. The taxation of land is vital in a national land policy, and a great deal of the trouble of the present time is due to faulty policies of taxation of land, but we must have separate measures of taxation for different kinds of land. This simply calls to mind what all experts on for- estry are agreed upon. Take the question of public ownership versus private ownership. One can not say that land should be publicly owned or privately owned. It all depends upon the kind of land that we are dealing with. The experience of the world shows that farm land should, in the main, be privately owned, but with equal clearness world ex- perience shows that forest land must be largely publicly owned, if we are to have suitable areas of forest land suitably distributed over the country and to raise the forest crops that we need with the least expenditure of labor and capital on the smallest area of land. We can not consider one kind of land alone and reach satisfactory solutions of the problems involved in a national policy for land utilization. Here we come to something that is often overlooked. Forest land must be considered in its relations to agricultural land ; forest land is, after all, one kind of agricultural land. A good deal of the timberland of the country is found on farms and the farmers use a very large proportion of the forest products. The forest is simply one kind of crop. It has its peculiarities as have other crops, one of the chief being the time it takes to plant, care for, and harvest a crop. With forests go certain by-products, in some cases game, in other cases pasturage, but the forests of a country should be handled in accordance with sound, agricultural principles; anyone who has advanced even through his A B C's in land economic^s must condemn most vigorously the policy to separate out the forest land from the United State's Department of Agri- culture and transfer it to another department. REPORT OF THE NATIONAL AGRrCULTUHAL CONFERENCE. 115 But urban land has to be considered in its relations to other kinds of land; otherwise we make very serious mistakes in our land poli- cies. The line separating urban areas from agricultural areas is a purely artificial one. A great deal of food production takes place within urban areas, and this food production may be increased very largely. We may consider urban areas from many different points of view. We may discuss the taxation of urban land and the ex- tent to which the taxation of unimproved urban areas defrays the expense of the Government and helps to keep down the tax rate. We may also consider urban areas as a reserve to be used in emergencies as in the case of the World War, when it was said that our war gardens saved the situation. But there are other respects in which the urban area has signifi- cance from the point of view of agricultural production. We find in cities the great terminals of our railway systems and also in cities we find the great harbors with their shore lands. The cost of carrying farm products depends in no small measure upon the way in which we handle these urban areas. Urban land must be considered along with otheJr kinds of land in framing a national land policy. From the point of view of agriculture it is imperative to classify land with a view to determining what areas should be devoted to crops, to grazing, to forests, since we must have distinct policies for each one of these kinds of land. In so far as we depart from wise policies by putting one kind of land into use which is appro- priate for another kind of land, we become involved in difficulty. This is illustrated by what has already been said regarding the trend of land utilization during and after the World War. With respect to control we may say that crop land should be mainly privately owned and controlled. It is so now and it should be left so. Grazing land is largely under private control, but in- creased social control is imperative. Unfortunately, land suitable for grazing only has been plowed up in an attempt to use it as arable land, and there are cases where once plowed up the destruction has been such that 100 years would not be sufficient to repair the dam- age. In fact, the good elements in the land have blown away. There is a difference of opinion on the part of authorities with respect to the extent to which the grazing land in the far West should be publicly owned and in the extent to which it should be privately owned with a measure of social control. The chief diffi- culty is with range land publicly owned, privately used, without adequate control of the mode of use. Students agree that the value of live-stock production could be increased by millions of dollars by the scientific use of the range land. The grazing homestead act is a most inadequate solution. In any case the grazing land of the country requires its own policies, and, if these policies are not wise, the country must suffer seriously. How few people east of the Eocky Mountains know that the area of natural grazing land approximates the area of arable farm land. Forest land should eventually be mainly in public hands in order that the forest crop may b#suitably located and properly managed. There are technical reasons for this which belong to the science of forestry and into which we can not now enter. The experience of the 116 EEPORT OF THE NATIONAL, AGRICULTURAL CONFERENCE. world, however, confirms the position here taken. We see the harm done by unwise policies in cases where mountain sides have been used for farming, where they have been plowed up, where the soil has washed away, aiid where it would take hundreds of years to restore the damage. What we need is an economic survey, utilizing the results of land classification of the Geological Survey, of the soils survey, and the admirable work of the surveys conducted by the divi- sion of land economics, and of any other surveys that may have been made — a survey which will be continuous, but which each year shall yield a crop, as it were ; that is to say, increase our knowledge. The suggestion of a continuous survey should alarm no one. We should use the knowledge we have gained, which is sufficient for many practical purposes, but, on the other hand, we should work along without end, expanding as time goes on and as the use of land becomes more and more intensive. It is to be hoped that in time, through the cooperation of various agencies, a map of each selec- tion of the United States will be made, giving soils and all other features, not only physical but economic. This survey would serve not only the purpose of providing inadequate information for the most economical use of the land, but also to make possible scientific valuation of the land as the basis for credit, taxation, and sale. Corresponding to this general survey of natural resources, we need the cultivation of the field of land economies — a field of work upon which an excellent beginning has been made in the United States Department of Agriculture. But in addition to public agencies, it is essential to the .establishment of a sound national policy that we s-hould have the help of a private organization, supported by volun- tary gifts and contributions, like the Institute for Kesearch in Land Economics, because the institute, covering the entire field of land eco- nomics, is able to gather together in a synthesis the results achieved by all public bureaus and departments. I have attempted to frame a definition of land economics, which I will quote, although on account of lack of time I am forced to do so without note or comment. Land economics is that division of economics, theoretical and applied, which is concerned with the land as an economic concept and with the economic rela- tions which grow out of land as property. As science, land economics seeks the truth for its own sake. It aims to understand present facts pertaining to land ownership in all their human rela- tionships, to explain their development in the past, and to discover present tendencies of growth. As an art, it alms to frame constructive land policies for particular places and times. But to make this definition more thoroughly intelligible I will add the definition of what a land policy signifies : A land policy takes as a start''? point the existing situation with respect to land, land as here used being equivalent to all the natural resources of the country. It examines the processes of evolution by which the existing situa- tion has been reached and proceeds to develop a conscious program of social control with respect to the acquisition, ownership, conservation, and uses of the land of the country and also with respect to the human relations arising out of use and ownership. Our country does not stand alone. American economic life has become a part of world economic life. Economic evolution has car- ried us beyond national isolation as a possibility. We need not argue this, because we are dealing with facts, and to the economist it must BEPORT OF THE NATIONAL AGRICXJLTUEAL CONFERENCE. 117 seem like denying the rotation of the earth to dispute this proposi- tion. Nothing that anyone can say will change this fact any more than the commands of Canute could change the rising of the tide. More than this may be said. We are unworthy descendants of the fathers of this Republic if we do not advance beyond their knowledge and practice to correspond witih economic evolution. They were progressives. They advanced feiyond the knowledge and practice of their fathers. Shall we ceaee to be progressives and attempt to frame our policy upon conditions of George Washington's time ? Credit has already received attention from other speakers. It be- comes a land utilization problem in newer sections of the country where settlement is being developed, and the credit policy must be somewhat different from that which is suitable for regions or estab- lished farming. No matter how long interest rates may ultimately fall, and it is recognized that suitable credit machinery may help in bringing about the result, the interest level must ultimately be governed by the amount of capital and the demand for it. The issue of paper money and other similar schemes no matter how useful in certain political exigencies is but th« beating of the tom-toms, as witness the results in Europe to-day. The continually recurring suggestion of the political charlatan that the interest rate may be lowered by put- ting the printing presses to work or otherwise inflating the cur- rency, was sufficiently disproved by the experience of all countries during the recent war when the process of inflation resulted in con- tinually mounting rates of interest. The slightest breath of suspi- cion, the very suggestion of repudiation or repayment in cheap money raises the rate of interest which farmers must pay. A land policy must look toward the maintenance of peace in the world, not merely international peace but what is even more essen- tial, peace at home. The prosperity of war is temporary and illusory. War spells poverty. Our land policies must have relation to world land policies and be of such a nature as to provide the nations of the world with food and raw :gaaterials. In our own country there must be a proper proportion between agricultural production and the production of nonagricultural goods and services. This is fundamental in the establishment of a national land policy. It is an elementary proposition in economies that we can not have absolute overproduction ; in other words_, we can not have too much production in general. The purpose of production is the satisfaction of human wants, and human wants know no limit. They expand with their satisfaction — " They grow by what they feed on." It has also been laid down as a general principle in economics that the satisfaction of any lower want creates a want of a higher order. We satisfy the animal man, then the intellectual, spiritual, aesthetic man demands his satisfactions. To-day, as never before, we must emphasize the truth that man can not consume except as he produces. If we produce less beef we must consume less beef. This is as true as that two and two make four and not five, and that human beings, by and large, can "not get something for nothing. The- crying need now is for more production. To think that we can become generally more prosperous by reducing hours of labor below a proper normal length of the working day, and 118 REPORT OF THE NATIOKTAL AGRICITLTUKAL CONFEKBNCE. by cutting down efficiency in production, is sheer insanity if it is not revolutionary bolshevism. Now while this general elementary proposition in economics can not be stressed too strongly, it is just as true that we may have par- ticular and special overproduction and generally this means dispro- portionate production. The problem to which attention is called as a land utilization problem is that of proper proportion in the differ- ent kinds of economic production. It is this which must be borne in mind if we are not to have a recurrence of agricultural distress. Never Has enough food been produced to satisfy the hunger needs of all human beings, but there have been times when in parts of the world we have had a very serious disproportionate development of food production. Food has been produced at a loss and has fre- quently found no market. Wants have existed, but purchasing power has been lacking. There has been a lack of coordination and balance of economic forces. Price fixing will never bring prosperity. No price can be men- tioned which would make all the farmers prosperous. It is quite conceivable that with the price of wheat at $5 a bushel we should increase the number of those producing wheat at a loss. At the same time we would have a price which would spell poverty to the non- agricultural population. Price fixing tends to stratification and to a stationary economic condition, and especially would this be the case if it took the form of price stabilization through the purchase of surpluses by gov- ernment, apart from possible national bankruptcy. The tendency, if carried far, would be, to use a phrase of the late Theodore Eoose- velt, "to Chinafy" our country; but I do not like to use the word " Chinafy," because it does injustice to China. It would tend to prevent progress, which is dependent upon ready transfers of labor and capital from pursuit to pursuit, so that all of the productive forces may be best employed. If there is a permanent and general tendency in agriculture to give unduly small returns, it signifies investment of labor and capital in agriculture and those producing under unfavorable conditions should see other occupations. Price stabilization is desirable in so far as it can be obtained through adjustment of production to demand, the full use of all ob- tainable information, and the better adjustment of marketing ma- chinery. All land policies must have as their aim general prosperity ; other- wise they are doomed to failure. The farmer must have prosperity, which means prosperity for other economic groups in the country, and, indeed, in the world. What we need is indicated in the formula of the three G's, namely, good farming by good men on good land. We must put land into its proper use; we must continue the efforts already begun, for which our State departments of agriculture, our agricultural col- leges, and the splendid United States Department of Agriculture deserve our highest praise. We must do our best to lessen the num- ber of submarginal men, and here reference is made merely to those measures which are agreed upon by substantially all eugenists, to lessen the number of the absolutely unfit, while at the same time we do our best to cultivate all human powers, ethical and spiritual as well as economical. BEPOET OF THE NATIONAL AGRICULTTJEALi CONFERENCE. 119 THE TAXATION OF LAND. The taxation of land is a large problem in itself and can be treated now and here only in the very broadest terms. At the meeting of the National Tax Association, held in Bretton Woods, N. H., last September, it was the general consensus of opinion that the burden of taxation resting on land was becoming excessive — in fact, confis- catory. Already we find places like Michigan where the burden of land is forcing it back into the hands of the State, and it is said on reliable authority that in Ohio special assessments on farm land are absorbing all the value of the land and threatens to force many farmers into hopeless bankruptcy. At the same time we find agita- tion for the appropriation through taxation of all land values. It is, therefore, a fundamental problem in land utilization whether or not we shall retain private property in land. At least it is our opinion that private property is beneficial alike to society and the individual. We take the position that methods of taxation should receive careful attention to the end that the tax burden should become more and more widely diffused, just as the benefits of government are more and more widely diffused. Property, whether in the form of improvements or of land, should be taxed; otherwise this tax burden tends to become confiscatory. Land settlement embraces a variety of problems in land utiliza- tion. We have discussed several of them already in treating these problems — as to the proper proportion between agricultural produc- tion and the production of nonagricultural goods and services; the right proportion between the various requisites of production; the credit problem ; and, in fact, all that has been presented has its bear- ings on land settlement. Among other problems the following are mentioned : , First. The political and social conditions which result from the quality of the settlers, because we want in the future landowning farmers who will resist new tyrannies as actively as our forefathers resisted old tyrannies. Second. The adaptation of policy to the various elements compris- ing the jjopulation, to their relations, actual and prospective, with a clear understanding of the fact that these relations must be based on similarities and differences, past and present. • Third. Methods of attracting to agricultural land good agricul- tural labor and training it as a source of supply for land settlement. A fourth very serious problem is that of wise selection of land. It is in land selection that the settler most frequently makes his failure, and as this is a case where the purchaser (the settler) is un- able, and necessarily unable, to judge of quality of the purchase which is to afford him a living and a heme, he should be provided with ade- quate help by various social agencies, private and public. Nothing is more pitiful than cases of honest, hardworking settlers cheated out of their little homes by unscrupulous dealers. One case only — a man had a little home in Chicago and was induced to exchange it for a so- called farm, which consisted of worthless swamp land. He toiled in vain, his wife died, he went insane, and his children scattered. Would hanging be too good for this unscrupulous agent? In an- other case the settler went back to Chicago and became a bolshevik. 120 REPORT OF THE NATIONAL AGRICULTURAL, CONFERENCE. The fifth problem is that of land classification and withdrawal from settlement of unsuitable land. , The sixth problem is that presented by the high capitalization of land values. The seventh problem is that of wise land planning and the closer settlement of the land. RECLAMATION. The reclamation of land plays a large role in land utilization. Others have discussed this problem. Here it is necessary only to emphasize raerely the fact that reclamation applies to many different kinds of potentially good land, e. g., swamp lands, cut-over lands, irrigable lands, worn-out soils, etc. The policy of reclamation must be viewed as a national policy, and money must not be expended be- yond prospective returns; otherwise capital is wasted. In other words, we must have proper balance between cost and return. ADMINISTRATIVE AGENCIES. Given needed legislation, land utilization requires satisfactory ad- ministrative agencies. Let us remember that this problem, like all administrative problems, is only secondarily a legislative problem. It has already been suggested that we need land commissions. State and Federal, to help bring about good settlement. We need these agencies for other aspects of land utilization. The policies grow more complex as wealth and population increase. The administrative agencies are to guide, to direct, to enforce, to exercise various de- grees of control. Laws establishing them must be broad in scope and of a kind to attract to this high service talent equal to any that the country affords, men who will regard their office as an oppor- tunity to serve, putting their souls into the work. TENANCY. We do not know enough about tenancy to decide what is a normal amount of tenancy in an old, settled country. It may be 20 or it may be 30 per cent. Certainly it must vary with the racial com- position of the population. We do know that there is much bad tenancy. We do know poor tenants account for a part of this bad tenancy. We do know that there is much good tenancy. We do khow that tenancy is very frequently a rung on the agri- cultural ladder. We find in some places that tenancy is merely a method of transferring property from generation to genera- tion—the tenants being sons, sons-in-law, etc. We find farms in which every tenant becomes a farm owner, or 100 per cent owner producing farms. We need more light and we need to help the more capable tenants to become farm owners; in some cases additional credit may be needed, but we have inadequate data. We do not want incapable men to become farm owners, and we do not want to encourage attempts to buy land with excessive grants of credit, leading only to ruin. To give a man 95 per cent of purchase price of land through public grants of credit would be disastrous to en- courage men to gamble in futures. REPORT OF THE NATIONAL AGRICULTUBAL CONFERENCE. 121 Finally and lastly, we must emphasize the often-overlooked fact that a modern farm is a large enterprise worthy of our best brains. Our agriculture needs big men capable of big things. A great many in writing on agriculture seem to think of it as a small business for small men. They would so restrict the possibilities of land owner- ship that it would not attract the kind of farmers who helped to establish our independence and who framed our marvelous Consti- tution. In our early days our greatest statesmen lived on the land and were proud to be farmers. It was not necessary to legislate them into office. They were our natural, our voluntarily selected leaders. We think of men like Madison, Monroe, and Jefferson, and, above all, Washington. Our land policies, while giving every opportunity for capable young men to rise, must at the same time be of such a character as to keep up the breed of big men among our- farmers. A NATIONAL POLICY FOB, AGBICULTUKAL RESEARCH. By Dr. Raymond A. Peaeson, of Iowa. There should be a well-defined national policy in reference to agricultural research, because such research relates to questions of fundamental national importance, and the value of such research to the whole Nation has been proved; furthermore, agricultural prob- lems affecting the national welfare are becoming more and more numerous and complex, and research must be enlarged to enable us to cope with them. The policy should be to provide ample support for the investigation of problems relating to the decrease of cost of producing farm products and their more efficient distribution and marketing, the improvement of their quality, the conservation of soil fertility, and the betterment of rural life. The policy also should be to encourage cooperation of all public agencies engaged in agricultural research and to provide for proper provision — enough of each to produce the highest possible efficiency and not so much as to hamper efficiency. Sound arguments in plenty can be given to support these state- ments. THE IMPORTANCE OF AGRICULTURE AS A FUNDAMENTAL INDUSTRY. About 40 per cent of the population of our country is engaged in agriculture. There are nearly six and one-half million (6,448,386) farms, including nearly 1,000,000,000 (955,676,545) acres. Each farm is an independent unit, and the character of the homes on these farms has a profound influence on the character of our Nation. The value of farm lands is estimated to be over $66,334,309,556. The value of implements and machinery is estimated to exceed $3,596,317,021. The estimated value of live stock is $7,996,362,496. The total of these great investments is $77,925,989,073. The value of the annual production of our farms far exceeds that of any .other industry. It is equivalent to the value of all manu- factures over the costs of raw materials. The value of farm prod- ucts exported from the United States has averaged $2,062,000,000 122 EEPOKT OF THE NATIONAL AGRICULTURAL, CONFERENCE. per year the past 10 years and constituted an average of 44.4 per cent of all domestic exports. In brief, it is sufficient to say that agriculture is our largest in- dustry ; it furnishes practically all of our food, the material for all of our clothes, the raw material for the larger part of the manufac- turing industries of the Nation, about one-half of the gross earnings of the railroads of the country, a consumptive market for nearly one-half of all the manufactured products sold on our markets, and, lastly, agriculture furnishes a constant stream of rugged people who quickly find positions of service in the great centers of popu- lation. THE PRESENT ORGANIZATION FOR RESEARCH. Research has been applied to all phases of human activities, but research in agriculture has been relatively late in development It came with a growing concern for the future of agriculture — an appreciation that as long as man lives agriculture must be a per- manent industry, and as population increases agriculture must be increasingly efficient. The policjr of encouraging agricultural research started in the States. Agricultural experiment stations were established in Con- necticut and California as early as 1875, in North Carolina in 1877, and in 15 other States prior to 1887, when the Hatch Act became effective. In 1906 the Adams law was passed. These two laws are formal acknowledgment by Congress that agricultural research is an important national question. Under each of these laws every State receives $15/)00 annually for agricultural research, making $1,- 440,000 from the Federal Treasury. State appropriations for the same purpose amount to about $3,000,000 annually. Research work in the States stimulated similar work in the Federal Department of Agriculture, which is now by far the largest single organization conducting agricultural research. This department gives attention principally to problems of national or regional character and en- gages in cooperative research work with the State experiment sta- tions to a large extent. It would be impracticable for" the Federal department to care for all the problems pressing for solution, and wisely that is not attempted. The States are in intimate contact with their own problems and, so far as funds permit, give these problems prompt and usually sufficient attention. THE RESULTS OF AGRICULTURAL RESEARCH. The benefits of agricultural research are so well known that it is hardly necessary to mention them. For example : A farmer pro- duced pork at a cost of 44 cents per pound until he made use of in- formation gained from research, and then he reduced his cost to 4 cents per pound. Through instruction based upon research and widely disseminated to the farmers, one State has shown how to reduce losses from the Hessian fly to the extent of 25,000,000 bushels of wheat in four years— and all this at only a nominal expense. Re- search has made it possible to continue growing important crops in sections of the country where some pest or disease was turning the farmers' efforts to naught. REPORT OF THE TSfATlO'SAL AGRICXTLTUHAIi CONFERENCE. 123 Books could be filled with interesting stories, such as how the cause of wheat rust was discovered and a remedy applied, and how Texas cattle fever was placed under control and is being surely eradicated, and many other similar exploits. Add to all this the development of improvements of animals and plants and of agricul- tural methods generally. Research is the foundation for our whole system of agricultural education in colleges and schools, through the extension service, and through agricultural journals and books. It also is the basis for regulatory laws and their enforcement. It would be impossible to tell what would be the situation in this country to-day if agricultural research had not been maintained. We know some of the most important improved varieties of plants and some of the better strains of animals would be missing. Some diseases of animals and food plants would be rampant. Great areas of soil now producing crops would be barren, and the production from still larger areas would be lowered. Farmers would be pay- ing more for their supplies and some highly effective marketing methods would not be known. MORE RESEARCH IS NEEDED. It is unfortunate that the research agencies of the country are unable to keep pace with the demands being made upon them. The experience of the past, the present situation, and a view into the fu- ture emphasize the necessity of enlarging the system. A sound and efficient agriculture calls for more research. The development of some phases of agriculture, representing millions of dollars to farmers and to other citizens, awaits the enlargement of research activities. As the country becomes older and its population in- creases and quicker transportation is developed, new problems con- stantly, appear. Some persons who are not informed think we are doing quite well at the present time and agricultural research might be kept on its present basis, or even it might take a vacation for a few years. But the germs and fungi now on their way to favorable locations throughout the country will not pause on their journey, and plant food will continue to be depleted when crops continue to be taken from the soil. Eesearch- problems might be divided into two great groups. The first would include the new difficulties that are constantly arising and must /be overcome to keep agriculture in its present position, such as a new insect pest. The second would include such questions as the improvement of existing methods which means a better agri- culture. Originally the second group of questions constituted most of the research work performed. More and more questions in the first group have been coming to the front in recent years, until now they demand a very large part of the research resources. New methods for reducing cost of production, the better distribu- tion of farm products, and better methods of marketing are sorely needed at this time. This is in the interest of the average citizen who buys all his supplies, because such methods will help to reduce the cost of living. This is in the interest also of farmers, because better methods will increase the profits of farming. Both benefits are worth 124 REPORT OF THE WATIOITAL, AGRICtTLrUBAL CONFERENCE. while. But a chief reason tor decreasing the cost of farm produc- tion is the importance of holding our position in the markets of the world. We ought to get a better hold upon those markets, especially in so far as certain manufactured farm products are concerned. If we wish to sell to Great Britain at a profit we must be able to make a lower price than others can make. We used to export about 140,000,000 pounds of cheese annually, but before the Great War these exports had fallen to two or three million pounds. We like to say that we are not exporting cheese because our larger population is consuming it all. But why did not our cheese production increase with our population? The chief reason was that Canada could do better than we could do in making a favorable price on cheese in the English markets. The outcome of such competition depends largely upon the results of our research for superior and less expensive methods. Our natural resources, plus our skill, plus our shipping ability, are in competition with the natural resources of other countries, plus their skill, plus their shipping ability, plus their cheaper labor, which involves lower living standards. If we are to win from them, we must depend chiefly upon our superior knowledge. Some other coun- tries have as good natural resources as ours. Sometimes they are even better because of virgin lands. Other countries have as favor- able transportation. Most countries have cheaper, labor. We must overcome their advantages by our knowledge, which must be devel- oped through research. When we find an economy in feeding or some method of reducing cost per bushel, or when we invent an improved harvester or perfect a silo, or when we find more direct and efficient methods of marketing, we are able to reduce our selling price and thus strengthen our hold on foreign markets. When we allow a mysterious disease or inefficient methods to increase the price we must ask we are losing our hold on foreign markets. We must not forget that in other countries strenuous efforts also are being made to devise better methods through research in order to take the foreign markets away from us and even to invade our home markets. Thus far we have developed only a background of information regarding the great economic questions. We have hardly crossed the threshold in research concerning the adaptation of pro- duction to requirements and other such great economic problems. Other vitally important subjects waiting to be studied as they deserve include the betterment of rural life. There are many ques- tions relating to the comfort and happiness of people who live in the country that are becoming constantly more acute ; these include the whole sphere of the work of farm women. The failure to solve these questions is resulting in some of the best type of farmers moving from the country to the city. Much needs to be done to show such people how to make country life as satisfactory as city life. One. other of many very important problems in need of research may be mentioned — the conservation of soil fertility. This is the most important of our natural resources. It is easily removed but not easily replaced. We gather crops very much as we harvest lum- ber. Most people know how we have accomplished such an enormous production of lumber during the past few decades. We simply went into the forests which had required hundreds of years to grow and REPORT OF THE NATIONAL, AGRICTJLTTJEAL CONFERENCE. 125 we took the trees that were wanted and even gave scant consideration to the welfare of other trees which might have become useful in later years. We have not considered how succeeding generations will get their lumber; we have proceeded on the basis that we might as well take it all. We point to our lumber kings as examples of great business ability. What will be said of them 50 years from now, when the people of that day want lumber and find that the accumulated growth of centuries over large areas has been destroyed by our generation and even without much effort to start new trees for use in the future? Our cereal production has been carried along on about the same lines. If present practices continue, this Nation will awaken some day to the fact that we are more like arid Egypt or Babylon than the wonderful, fertile country that our histories tell us was discovered by Columbus. Furthermore, we are allowing many square miles of good farm land each year to be washed away by our streams. This erosion, supplemented by surface wash, amounts to hundreds of millions of tons annually. These losses represent stupendous values, which doubtless could be largely reduced through further research. No one can tell what wonderful improvements in agriculture may be revealed in the future. We easily think of possible further ad- vances along the lines we know about, but these may be made sec- ondary by other advances that we can not now even think of. Some persons believe that beneficial changes are yet to come in agriculture which are no less profound than the changes in transportation caused by the flying machine or in communication caused by the wireless telephone. These two improvements are epoch making, but were hardly within our range of thinking a generation ago. I will not be so rash as to suggest that a tin lizzie ever will give milk, but I will predict that some day power for the farm, which now constitutes, a chief item of expense, will be obtained cheaply from the winds that blow over the farm. And with this cheap power I predict that some day we will produce the best of building materials at lowest cost from almost any soil. It may be aluminum. I will predict also that if our plant and animal experts are given reason- able support they will find in good time new and good foods now unknown, and if our economists and other experts are given reason- able support they will show how our cities may be assured of an abundant supply of farm products at all times and at cost reductions that will exceed previous cost reductions that have been so welcome to both farmer and consumer. DEVELOPMENT OF A POLICY. We should not longer delay the development of a more compre- hensive national policy for agricultural research. It should provide for liberal Federal and State financial support. The best recent tes- timony comes from the Congressional Joint Commission of Agricul- tural Inquiry (Congressional Kecord, Dec. 14, 1921, p. 421). Mem- bers of this commission, after a long and thorough study, report as follows : Agriculture is subject to special hazards resulting from tlie weather and cli- matic conditions, animal and plant diseases, and insect pests. These hazards reduce farming to a gigantic gamble. But methods of production can be adapted 126 REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. to the end of reducing losses from climatic and weather conditions to the mini- mum. Plant and animal diseases and insect pests can, to a certain degree, be controlled. But the means and the method of reducing or controlling these hazards can not be worked out on the farm by the Individual farmer. The investment even of the largest is not sufficient to permit the maintenance of the organization necessary for the study and formulation of these means and methods. A program of agricultural development, therefore, must include provisions for an expanded and coordinated program of practical scientific investigation, through State and national departments of agriculture and through agricultural colleges and universities, directed toward reducing the hazards of climatic and weather conditions and of plant and animal diseases and insect pests. One strong reason for using public funds to support agricultural research is that the knowledge to be derived should be made avail- able to every farmer throughout the country who wants it. It should never happen in this country that knowledge relating to agricultural production shall be limited in its application to private interests because it was developed at the expense of those interests. It may not be improper in other lines of business for individuals or concerns to have a monopoly on knowledge and thus enable them to develop a business monopoly. But this should never be possible in agriculture. A cornerstone of our national strength is the independent farm fam- ilies who are able to maintain theimselves on an independent basis, because every farmer is entitled to know all of the secrets of his busi- ness that anyone knows. APPEECIATION OF AGKICULTUEAL EESEARC'H. (1) What should be insured first in a national policy? Agricul- tural research needs first of all the appreciation and good will of the public. Until this is given, the research will be heavily handi- capped. Secretary of Agriculture Wallace declares, that research is the basic work of his department, and it is research that little by little is crys- tallized into agricultural progress. The public should get this idea. The Congress and legislatures should have it. An intelligent ap- preciation of agricultural research, especially among leaders and public men, a genuine respect for it, an understanding of its im- portance and its requirements, are the primary essentials in develop- ing an effective national policy. Such an appreciation exists to-day, but in a very restricted sense. Belief in the importance of research is too much of an abstract character, an acknowledgment that it is useful in a general way, an acceptance of the fact that it is desirable, but without real sympathy for it or understanding of its require- ments. Thus the public fails to demand it in order that the Nation's interests may benefit. One thoughtful student gives as one of the reasons for advocating national support for agricultural research the fact that national appreciation needs the stimulus of direct interest which comes with the discussion of the subject in the halls of Congress and the making of an appropriation. There are, however, other and better arguments. An intelligent appreciation of agricultural research is not evidenced in any large way by the recent action of Congress, let us say a very few Members of Congress, by which the publication of two periodicals- in the interest of agricultural research was suddenly ordered dis- continued, along with a lot of other publications of questionable EEPOET OF THE NATIONAL AGBICULTXJRAL CONFERENCE. ],27 value, most of which had developed during or soon after the war period. ^There is encouragement in the fact that some leading Mem- bers of Congress were not informed as to what was occurring but now realize that a serious mistake has been made and are ready to help correct it. ESSENTIALS FOR RESEARCH. Well-trained men and ample funds are the essentials for re- search. It should be a national policy to train and encourage in every way possible the right kind of men and women and to sup^ply funds to meet their reasonable needs in research work in the in- terest of agriculture. (2) Efforts should be made always to encourage young men and women, who have ability and inclination of the right kind, to pre- pare themselves for research work. Special scholarships and fel- lowships should be provided by the agricultural educational insti- tutions to enable such persons to complete their fundamental train- ing, and later assistant ships should be provided to bring them into helpful contact with older and well-trained investigators, and due credit should be allowed for their own efforts. As they advance in ability and in getting worth-while results, their compensation should be reasonably increased. Care should be taken to make this compen- sation as attractive as is provided for persons of corresponding ability and service in allied lines of work. Failure in this respect in recent years has resulted in heavy losses from the ranks of research workers in the Department of Agriculture and in State experiment stations. During a period of about six years, including the war, there was a change of nearly 80 per cent in the scientific personnel engaged in agricultural research throughout the country. Many of the younger men went into war service, but the greater losses to agricultural research came from the resignations of older men who took other more remunerative positions. The ouerturn has been exceedingly large since the war. On this account, and without re- flection upon those who have continued in research work or who have recently gone into that work, it must be admitted that research to- day, instead of being the strongest link in the chain made up of research, college education, and extension work, is the weakest link. Research is the least able of the three to meet the demands it should care for. Funds for the support of agricultural research as now available represent such a small percentage of the interests concerned that they are almost negligible by comparison. They represent a much smaller per cent of value of output than is so expended by many a manu- facturing plant in the interest of its output. (3) A principal requirement as to funds is assurance of perma- nent income. Without such assurance strong men can not be in- duced to prepare themselves adequately for research, nor can they be retained in this work. Too often it has been necessary to stop important experimental work because of failure to continue appro- priations. No one can tell what losses have been suffered because important projects, after being conducted for an extended period of time, had to be discontinued with the failure of appropriations before the final results had been secured. 92640— H. Doc. 195, 67-2 9 128 REPORT OF THE NATIONAL AGRICULTUKAL CONPERENCE. « (4) As agricultural research relates in such large measuie to national problems, and the work done in one State is of value in many States, and as agriculture is such a large factor in all business, it is right that national funds should be used in promoting agricul- tural research in the different States. A precedent has been fur- nished, and a national policy for agricultural research should pro- vide for enlarging these national appropriations by small increments for a few years until they have reached amounts commensurate with present demands, as specified in the Purnell bill. This measure, or other similar relief, should be enacted as soon as possible. It is preferable from the standpoint of efficiency to make the appropria- tion with the fewest possible conditions, as are provided in the Hatch and Adams Acts, rather than to continue the • requirement for offset funds, as provided in the Smith-Lever and Smith-Hughes Acts. As compared with the Federal Government, it seems that the States now are carrying their full share. In considering appropriations for agricultural research it is well to remember that when our taxes are increased for this purpose our involuntary taxes, or those which are levied by powers beyond our control, are decreased many times more than the voluntary taxes are increased. COOPERATION AND SUPERVISION. (5) A national policy fostering agricultural research should pro- vide for more definite and constructive cooperation by research agencies than now obtains. (6) It must provide also for certain supervision to assure the proper use of public funds, and this is expected and welcomed. A reasonable amount of cooperation and supervision is stimulating. An excess amount is deadening. (7) A more definite agreement on the fields to be occupied by the Department of Agriculture on the one hand and by the State ex- periment stations on the other hand, with better coordination off work and a larger provision for joint effort^ should form a part of the policy for further developing agricultural research. Such a definition of function and joint effort would guard against undesir- able duplication and would result in better-directed efforts. Details should be worked out by representatives of the Secretary of Agricul- ture and the agricultural colleges, and when properly approved should form a fundamental law. Once each year this joint agree- ment should be considered by duly chosen representatives for the purpose of making it more perfect. Among other things, it should provide for the wise selection of projects for investigation and for inviting experiment stations in different States or the Federal De- partment of Agriculture to give attention to different phases of a project requiring investigation at different places. All projects should be briefly but clearlv_ described and recorded in the Depart- ment of Agriculture at Washington, and all interested persons should be informed as to the kinds of work in progress. From time to time, at least once a year,' the progress of each project should be officially reported and checked. When a project is undertaken, work on it should continue to a reasonable extent until it is finished or formally set aside, and care should be taken not to provide for starting new REPOKT OF THE NATIONAL AGRICULTXJEAL CONFERENCE. 129 projects for any laboratory or station when it has too many projects unfinished. (8) While a national policy for agricultural research should not enter the details of local administration, it should encourage the types of organization which would be most efficient. SHALL WE HAVE AMPLE AGRICULTURAL RESEARCH? An effort has been made to suggest a picture of our country as it would be without properly supported agricultural research, and again with such research. If this work is properly developed, agri- culture will continue on a permanent and profitable basis in the face of ever-increasing obstacles, and this Nation, with a strong agri- culture, will continue to furnish its own great commodities which come from the farms and will profit further from large sales of the surplus in other countries. The time is ripe for stimulating a na- tional policy for agricultural research which will contribute to this great end. THE PARM WOMAN AND THE rARM HOME. By Mrs. Charles W. Sewell, of Indiana. I realize that is very presumptuous for the farmer's wife to speak out in meeting. She has been supposed to do her full duty when she cared for the house, cooked the meals, washed the dishes and the clothes, took care of the babies, wiped their noses, spanked them oc- casionally and sent them off to school on time, but farm women have been invited here by Secretary Wallace and, as a member of the committee on farm population and farm home, we have worked long and hard to present to you a set of recommendations that you as a conference will be glad to adopt. I am wondering if you people have realized, as we think we have, that the heart of American agriculture to-day lies in the American farm home, and that not only the heart of American agriculture but the heart of this great big Nation itself, because there are so many influences at work at this time that seem to aim at the very vitals of this our most sacred institution. I want to give you some definitions of home as they are given in various parts of the country. Webster will tell you that the home is the place of one's abode. A little boy with a country home and mother was asked what home is. He said, " That's easy. Home is where your ma is." Another little boy who had neither country home or country mother said, " Home is a place where you change your clothes so you can go somewhere else." And as Abe Martin recently said : " Home has got to be a sort of a fillin' station in some localities where folks drop in." The last one I heard was about a young couple who were quarrel- ing on a crowded city street, attracting much attention and quite a crowd had gathered. The man, who had a grain of self-respect left, said, " Oh, come on, shut up, and go home. What do you want to quarrel on the slreet for ? What do you think you got a home for ? " 130 KEPOET OF THE NATIONAL AGRICULTURAL CONFERENCE. So I hold that the American farm home contains much that must be preserved and we must do everything in our power here as an agricultural conference to uphold the dignity, ideals, and principles that have long been inculcated in the American farm home. You will have no American statesmen if you do not preserve the home be- cause they say where the corn grows tall — Perhaps that is the reason that Iowa has produced so many Secre- taries of Agriculture. I want you to realize, gentlemen, that back in the country districts all over the United States there are country women waiting to hear what you do here this afternoon because we farm women will have to keep up the morale of the farm men until some of these reforms which are so emphasized and so needed are put into motion. So we are urging that you recognize that the farmer's wife is his business partner as the wife of no other business man can, possibly be. The man who has a shop or factory or office closes the door of his business when he goes home. His wife has not been • there. She knows nothing about how it has gone with him. But the farmer's wife is an entirely different proposition. She lives in his factory, she washes for and boards the men that work in his shop. She knows if the cattle break into the growing corn. She drives them out and builds up the fence. She knows when the tractor runs dry by the looks on her husband's face when he comes in. The farm woman sees the storm sweep down over the prairie in the fall of the year ahd the city person would see only the fine grow- ing crop and how many dollars it would bring if it was properly cared for and marketed. But the farm woman sees far more than that. She sees new linoleum for the kitchen floor, a new suit for the good man, a trip to the childhood home, or music lessons for the little daughter, or the first quarter's allowance for the education of the promising farm boy. But when the storm does come, many times wiping out the work of the farmer for the entire season, she slips her hand in his and says " Never mind, we will weather it some- how." She is his partner. She is willing to go on and do all things that he wants done. So I want to say to you that I am very grateful for this little recognition in this great audience because I represent not the wealthy people, but i come from 80 acres of land in Indiana, and I have been a tenant farmer's wife. I like to remember that Lin- coln said "God must have loved the poor people because he made so many of them." The farmer's wife is perhaps that one who has walked across the plowed fields some wild winter night to help her sister in her hour of distress. She has taken in her arms and dressed that new-born babe. In the eyes of city women she has perhaps so far forgotten her dignity that she knows how to harness horses and milk cows. She goes even farther than that — in the springtime of the year she will open the door of her clean country kitchen and carry in the baby lambs and pigs that they may be saved. After all, isn't she the woman who has really seen life ? REPORT OP THE NATIONAL AGRICULTURAL, CONFERENCE. 131 CONCLUDING REMARKS. By the Secretabt of Agbictjltube. No man could be insensible to the kind words and to the kind re- ception which you have so generously accorded me, but I must say to you that your chairman has rather overrecommended the Secre- tary of Agriculture. If I should undertake to make a speech now 1 would lay myself open to the charge which Mark Twain made against Bob Burdette on a certain occasion. Bob, you know, was one of our Iowa humorists. In his later years he became a minister, and he started a little mission church out in California. Not long afterwards Mark Twain happened to be there over Sabbath and went around to hear Bob preach. Speaking of it afterwards he said that after Bob had been preaching some 15 or 20 minutes he made up his mind that when the collection was taken he would give $100 to help put that little church on its feet, but as Bob continued, he gradually lost his enthusiasm, and when they finally passed the basket, he stole a nickel out of it. I do not propose to spoil this Avonderful conference by making a speech or trying to recapitulate or summarize what you have done here. Since you give me the opportunity, however, there are two or three things I would like to say. You remember in opening the conference I said that I believed it to be the most representative gathering of the agricultural interests of the Nation that had ever been brought together. I made that statement on the strength of the invitations we had issued and the knowledge of the people to whom those invitations had been sent. This morning I asked our boys who have been working so faithfully in the headquarters of- fice to give me a tabulation of the delegates who had registered and who have participated in the conference, and that recapitulation justified the statement I made at the opening. I find that there have been a total of 336 delegates in attendance. I find that they represent some 20 different national farm organi- zations, and you ma}'^ be interested in knowing the wide range of these organizations. There are delegates here from the Farm Bu- reau, from the Farmers' Union, from the Grange, from the equity societies, from the Gleaners' Federation, from independent farmers' clubs, from the Farmers' National Congress, the Farmers' Inter- national, Farm Congress, from the National Board of Farm Organi- zations, the woolgrowers', tobacco growers', rice growers', fruit grow- ers' associations, American Cotton Association, water users' associa- tions, dairy and milk producers' associations, meat producers' asso- ciations, horse breeders' associations, vegetable growers' associations, warehousing association, nut growers, and grain growers. The rep- resentation from these associations numbers 87 delegates from 37 different States. There are individual farmers in attendance to the number of 80. I mean by that men who come in their individual capacity and not as representatives of any organization. And these individual farm- ers come from 30 different States, thus making a total farm repre- sentation in attendance of 185 out of the 336. There are 79 delegates in attendance who are commissioners of agriculture or State officials 132 REPOET OF THE NATIONAL AGRICULTUHAL CONFERENCE. in some agricultural capacity, representatives of agricultural colleges and agricultural editors. The business group is represented by 62 delegates, and there are 18 women delegates. Now, I submit to you, my friends, the statement I made at the beginning of our associa- tion that this is the most representative agricultural gathering that has ever been brought together in the United States was fully justified. In the early hours of the conference I was told that here and there were whispers that this was a hand-picked conference. It was. And the figures I have just read to you, I think, prove it. It was not a hand-picked conference in the sense that there was any purpose to choose delegates with reference to their views. On the contrary, as your discussions here have revealed, you have delegates representing the widest divergence of views, and they have been extended the ut- most freedom of debate. Extraordinary courtesy has been extended to men whose views have met with the strong disapproval of nine- tenths of the delegates. Let me say a word concerning the representation from the related industries. Some have suggested, and rather vigorously, that in an agricultural conference it was not wise to call in representatives of related industries. I do not agree with that view. The representa- tives of the related industries speak for very truly related indus- tries. They are a part of agricultural production. Who is the pro- ducer ? We are in the habit of assuming that the farmers is the pro- ducer, but to the consumer it is not the farmer who is the producer. To the consumer of flour, for example, the producer is the composite of the farmer, the elevator man, the railroad, the miller, the whole- saler, the retailer — all of those people have contributed to the produc- tion of flour. In the case of meat in the eyes of the consumer the producer is the composite of the farmer, the railroad, the stockyards, the commission men, the packers, the railroad again, the retailer, clear down to the delivery boy. When we talk of doing things to improve our marketing system, to cheapen the cost of production and distribution, it is utterly im- possible to hope for success without the cooperation of all of these agencies which make up the producer in the eyes of the consumer. And there was another good reason for bringing in these repre- sentatives of the related industries. We have come to know each other better. It has been a good thing for the representatives of those industries to come in contact with the farmers from the various States; to hear their stories of their condition; to know their problems. And it has been a good thing also for the farmers to come in contact with their allies in business, because they are allies in one sense, and to hear their problems. I think there can be no hope if there is a continual antagonism between the farmer and these various related industries which are essential to the marketing of farm products. There is a conflict of interest in one way but a mutuality of interest in another and larger way Let me illustrate it in this way. Here are two farmers on adioininff farms, one a grain grower and the other a stockman. The one man feeds all his own grain, and feeds in addition grain grown by his neighbor and many other neighbors. Now, between these two neighbors there is a certain conflict of interest. The stockman REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. 133 naturally wants to buy his neighbor's grain as cheaply as he can. The neighbor wants to sell his grain to the stockman as dearly as he can, so there is a perfectly natural conflict of interest exactly as there is between either of them and the related industries with whom they deal; but when it comes to considering mutual interests these gentlemen stand together just as the farmers of this Nation and these related interests must stand together in the larger affairs in which their interests are mutual. We quarrel among ourselves as farmers, but we swap work in harvest time and threshing time and in times of sickness. So, in such times as these, the farmers and the gentlemen who represent the relkted industries must work to- gether in a common cause to put the agriculture of the Nation on a thoroughly sound, enduring basis, for without that, my friends, the future is hopeless indeed. This conference was called not for the purpose of simply voicing discontent. It was called for the purpose of constructive effort. In bringing together these varied interests we did so to move forward, gain ground, and consolidate that ground behind us. Of course, there are some who would like to go faster and further in some directions than we have done at this conference. There is no reason why those who feel that way should not themselves go faster, but this conference has definitely gained ground, and I think we can hold the ground we have gained. Now, a word about the selection of the committees, because I want you to go home clear in your minds as to how that was done. We had invited more than 300 people from ejfery State in the Union to come here and to come at their own expense and at no little inconvenience to themselves. We felt under obligations to do what we could in advance to see to it that the time spent here should be spent to real purpose. So we counseled together, and I said to Assistant Secretary- Pugsley and Dr. Taylor: " You gentlemen call together the wise men in the department and see what you can do toward making up committees which natural- ly suggest themselves, assigning these various delegates to the com- mittees to which properly they should be assigned from our knowl- edg of them, and where they can work most efficiently and where they would most like to work." And they called in from 12 to 24 men ; at times there were 24 men working about that table. Each man had a full list of the delegates. They went down these names one at a time. Among that group of men most of the delegates were known either personally or by cor- respondence or reputation. As a name was read some one would say: " Yes, I know that man; he is interested in this thing of that thing, and I think he would like to serve on this committee or that and could serve well there." And they went through that for two solid days in making up those committees. My friends, if therei are some who are disappointed, it is not be- cause we did not try to do the right thing in placing you where we thought you would serve best and would most like to serve. Let me say this to you on behalf of the people in the department who worked so faithfully in that, if there is any credit to be given, give it to them ; if there is any blame to be given, give it to me because I finally passed on the committees and I am quite sure if mistakes were made it was 134 REPORT OF THE NATIOKAL AGRICULTURAL CONFERENCE. my fault that I did not catch them. And let me say further that you can criticize me just as freely as you want because I have lon^ since learned that while I have the human weakness- of appreciation of kind words, I long since discovered that I learn most from the people who disagree with me rather than from those who always agree. I wonder how long it would have taken to get down to business if we had brought 336 strangers here Monday morning without this pre- liminary work. , ' I said to the gentleman who sat next to me at the conclusion of the President's address that if the conference should adjourn at that time, when the President left the platform, it would have been well worth while, and I repeat that statement now. Perhaps some President in some time long passed gave the serious thought to our agricultural problems that was evidenced by President Harding in his address, but if so my memory does not reach back to that time. When you read that address I think you will find it even stronger than you felt it to be when you heard it! I glanced at it briefly this afternoon, and made two or three notes. It included, first, a full recognition of the bad state of agriculture and the service rendered by the farmers. Second, it included a clear exposition of the importance of agriculture in our national life. Third, it contained an unequivocal demand for better meth- ods of financing agriculture, and an equally unequivocal demand for the right of farmers to cooperate in marketing. It stressed the need of better statistical information as to production and consump- tion, and suggested the wisdom of limitation of acreage of particular crops which were overproduced. In contained a vision of future transportation requirements, emphasizing the need of developing our waterways. It spoke of the importance of adding to our cultivated areas and increased areas of land as conditions would justify and make necessary. And finally it concluded with a tribute to the unusual knowledge and intelligence required for successful farming. And I say to you, my friends, that such a thoughtful address of 40 minutes by the President of the United States on the subject of agri- cultural needs at this time fully justified you in coming here. It was an epoch-making address such as has never been delivered before. And then came the address by your chairman, to whom you have paid such a handsome tribute, and. such a well-deserved tribute, this evening. You little know the painstaking care and the unending hours of time and study which he has given to your particular prob- lems. As the reports come from the commission of which he is the chairman, and as you study them you will begin to understand the magnitude and the value of the service which he has rendered to the farmers of the United States. And then in the afternoon came the reports from many of your own number telling of the conditions of. agriculture in the different sections of the States. And then later the various papers which were prepared on subjects of immediate importance, the suggestions on marketing, the discus- sions of national policies, all of them informative and constructive, all of them well worth publication and continued study. Now, as to what you have done, I do not propose 'to try to sum- marize it now. When it is all considered, I think it will' be found that you have presented the most well thought out, thoroughly con- REPOKT OF THE NATIONAL AGElCtTLTURAL CONFERENCE. 135 structive suggestions for the betterment of agriculture and for the sound building of national life in all the years to come. The inter- est of agriculture can not be separate from the national interest, because when all is said and done, if our agriculture breaks every- thing breaks. We have come to that time in the history of this Nation when, either consciously or unconsciously, we shall deter- mine policies which either made for a continuing self-sustained Nation here or mark the beginning of disintegration. There are some who take more pleasure in denunciatory resolu- tions than in constructive action. The Apostle Paul in one of his epistles, perhaps to the Corinthians, said something to the effect that all things are lawful, but all things are not expedient; all things are lawful, but all things do not edifj. Aimless running to and from and a profusion of words are neither satisfying nor edifying in such times as these. Now, just one further word. Something has' been said of the service of the Department of Agriculture. We have been glad for the opportunity to render that service. I want to say to you that there is a group of devoted men in the Department of Agriculture who are all too little known and all too little appreciated by the country at large. They are men thoroughly devoted, you might almost say consecrated, to the service of the farmers of this coun- try and to the service of the Nation at large. And let me say, in speaking of those who contributed to the making of a success of this great conference, that the omission of the name of Dr. H. C Taylor would be an injustice for which we could not forgive our- selves. Much of the credit for the preliminary arrangements and the orderly way in' which they were carried out belongs to him. This conference will be tremendously helpful to all of us here. It will be most helpful to our department. It has been a privilege to our people to come in contact with you who have come from prac- tically every State. We have known of your problems and difficul- ties and have been trying to help, but the closer contacts of this week will give us clearer vision, better understanding, and renewed, zeal and inspiration. I shall not thank you for coming, because that would be presump- tion on my part in thinking you had come to render some service to us and presumption in assuming that I have the right to thank you for doing it. I know that your interest in this whole matter IS the heart interest we all have here ; and in conclusion, I will say that it is a privilege to be permitted to work with you, and I wish you Godspeed, and God bless you. REPORTS OF COMMITTEES AND RESOLUTIONS. REPORT OF COMMITTEE NO. 1, AGRICULTURE AND PRICE RELATIONS. The overwhelming drop in the purchasing power of the American farmer is one of the salient features of the drastic liquidation that has taken place in the last two years. The decline in the price of the things the farmer sells has been so much greater than the de- cline in the prices of the goods he buys that his purchasing power has been reduced by one-half in the brief period of two years. This unequal liquidation of prices is the primary cause of the inability of manufacturers to sell their goods. It has resulted in failures of some and the practical insolvency of many of the important indus- trial concerns of the nations. This has been the primary cause of disastrous unemployment of millions of industrial workers. Farmers are not corporations. Each generation starts anew. The usual steps in becoming a farmer are to work as a hired man until sufficient money is saved to become a tenant. If successful as a tenant he buys a farm as soon as he is able to make a small payment. Any one of the million men who had the energy to become a tenant or owner in the last few years is fortunate indeed if he does not lose his life-time savings. The wholesale discouragement of the most progressive young men in so great an industry is a national calamity. The progressive farmer who has used the most successful methods has suffered most. The inevitable reaction from these conditions will be felt by the Nation for years to come if the inequality of the pur- chasing power between different groups in our population is not quickly adjusted. The conference declares that no revival of American business is possible until the farmer's dollar is restored to its normal purchasing power when expressed in the prices paid for the commodities which the farmer must purchase, and the conference further declares that by right the men engaged in the agricultural field are entitled to a larger return than they have heretofore received for the service they give society. An important step in reducing major causes of high prices is the adoption of uniform cost-accounting system for farming industries and commerce and the standardization of the products of the farm and of the factory and the availability of resultant data to author- ized agencies that are equipped and competent to suggest improved methods. The manufacturer has in the past quickly adjusted his production to price recessions, while the farmer has not. When farm produc- tion is so large that the product can not be sold for prices that will 137 138 REPORT OP THE NATIONAL AGRICULTURAL CONFERENCE. maintain a reasonable standard of living on the farms, the supply is too large. We recommend that the farmers and the farm organiza- tions consider the problem of world supply and demand and make comprehensive plans for production programs so that they may be able "to advise their members as to the probable demand for staples, and to propose measures for proppr limitation of acreage in particu- lar crops," as pointed out by the President of the United States. In the future we must insist that labor and capital employed on the farm receive from the hands of the Government the sanie meas- ure of tariff protection that is accorded labor and capital in other industries. This committee submits the following resolution : Resolved, That this conference congratulates the President of the United States for having the courage and the foresight to call, for the first time in American history, a conference representing every phase of American agri- culture. We commend not only this action of our President but most heartily approve his clear-cut and constructive address to the conference. We com- mend the Secretary of Agriculture for making the conference possible and the Joint Commission of Agricultural Inquiry for Its valuable published report, and we commend and approve the action of those members of the House ad Sen- ate compr.sing the agricultural bloc who, regardless of party, so early saw the emergency and have so consistently supported a constructive program for the improvement of agriculture and the bettering of rural life. Whereas the present. agricultural depression Is admittedly an outgrowth of disturbed world equilibrium caused by war. Stabilization of agriculture in the future depends in no small degree on friendly world relations. Resolved, That this conference of farmers notes with profound satisfaction the presence of a World Conference for the Limitation of Armament, now in session at Washington, and approves most heartily the forward-looking program of the American delegates to this conference, and trust they may be adopted by our own and the nations of the world. Whereas the surplus production of many products of American farms have long found and now find their main market in European countries are also now large public debtors to the United States. These are facts of Importance to every business Interest in this country. Resolved, That this conference therefore urges the administration to use its good offices and Its commanding position as a creditor country to aid in the industrial rehabilitation of Europe. Whereas periods of rising prices such as extended from 1897 to 1920 and periods of falling prices such as that from the close of the Civil War until 1896 work great Injustices and cause unnecessary and acute friction. These radical fluctuations in the purchasing power of the dollar takes money from some groups and gives It to others. It leads necessarily to Industrial instability. Inasmuch as some form of stabilized dollar offers hope for averting in some measure this conflict and Industrial losses. Resolved, That this conference recommends that Congress appoint a special investigating committee to examine various plans for stabilizing the dollar and to report any practical scheme which will minimize the manifest Injustices between debtor and creditor and producing and consuming classes which re- sult from these shifts in the general price level. Whereas owing to the large volume of American agricultural products which must necessarily be sold upon foreign markets, it Is Impossible to formulate a satisfactory policy for American agriculture without a complete knowledge of the course and direction of recovery in agricultural production abroad. Resolved, That this conference recommends that the Department of Agricul- ture take the necessary steps to get full Information with respect to produc- tion and demand abroad and to make this Information available periodically to the American farmer. Whereas retail prices have not declined as rapidly in recent months as liave wholesale prices. The result has been to reduce the consumption of farm products and to lower the purchasing power of the city consumer for the REPORT OF THE NATIONAL, AGRICULTURAL CONFERENCE. 139 output of other industries, thus at once causing In part and contributing materially to the severity of the crisis through which we are passing. Resolved, That this conference commends the measures ;that the Departments of Justice and Commerce have taken by publicity and otherwise to reduce retail prices and urges more vigorous action thereon. Resolved, That this conference recommends that every instrumentality of the Government of the United States be exercised to put the agricultural in- dustry on a par with other industries both as to remuneration, education, and general standard of living. REPORT OF COMMITTEE NO. 2, AGRICULTURAL CREDIT, INSUR- ANCE, AND TAXATION. PERSONAL AND COLLATERAL CREDIT. Believing that the permanent banking machinery of the country is not adequately adapted to meet the farmers' requirements for opera- tive and marketing credits, such as are now temporarily available through the War Finance Corporation, and believing that until such deficiency is provided for agriculture can never reach its greatest development; therefore, be it Resolved, first. That this conference urge upon the Congress the enactment of legislation to meet this need for short-term credit of from six months' to three years' time. Second. That such legislation shall empower an agency of the Government (1) to discount for any national banl£, State bank, trust company, incorporated live stock loan association, or savings institution, with its indorsement, any note or other such obligations, the proceeds of which have been advanced or used in the first instance for an agricultural purpose, or for the raising, breeding, fattening, or marketing of live stock; and, (2) to make loans direct to any cooperative association organ'zed under the laws of any State and composed of persons engaged in producing staple agricultural products, if the notes or such other obl:gatlons representing such loans are secured by warehouse re- ceipts covering such products. Such loans or discounts should have a maturity at the time they are made or discounted of not less than six months nor more than three years. Such agency may, in its discretion, sell loans or discounts with or without its indorsement. Such agency shall be authorized to issue and to sell debentures or other such obligations with a maturity of not more than three years when secured by a like face amount of cash or notes or other such obligations discounted or representing loans made in accordance with the provisions of the preceding paragraph. Any Federal reserve bank should be authorized to rediscount for such agency notes or other such obligations discounted or representing loans made as above referred to. Any Federal reserve bank should likewise be authorized to buy and sell debentures and other obligations issued by such agency. Third. That if an agency as above described, and for the purpose above mentioned, is not authorized by Congress, then this conference requests that the Congress at the proper time extend the period of activity of the War Finance Corporation from July 1, 1922, until such time as may seem necessary and proper. Fourth. That section 14, paragraph 1, of the Federal reserve act be amended so as to give the Federal reserve banks the authority to buy and sell, with or without the indorsement of a member bank, notes secured by warehouse receipts covering readily marketable nonperishable agr;cultural staples or by live stock, of the kinds and maturity now eligib,le for rediscount under the act. Fifth. That in the selection of members of the Federal Reser.ve Board and the directors of the Federal reserve banks due representation shall be given to agriculture, merchandising, and manufacturing to the end that credit policies may the more surely comprehend the welfare of all basic industries. 140 REPORT OF THE NATION,'' AL AGRICULTURAL CONFERENCE. THE FEDERAL FARM LOAN SYSTEM. Whereas tliere is now greater need than ever for land credit at reasonable rates ; and Whereas the Federal farm loan system has been somewhat hampered in its de- velopment and has been somewhat modified in its original plan by the exigen- cies of war and war finance ; and Whereas the principle of cooperative credit is still new in our country and therefore lacks appreciation by large numbers of our people : Be it Resolved, First, that we urge the Farm Loan Board to continue to employ extraordinary efforts in the sale of farm loan bonds, and that the Congress pass appropriate legislation to create an agency within the farm loan system to market its bonds. Second. We recommend that oflicets of the board and of the banks dili- gently and persistently maintain and promote by administration and education the cooperative features of the farm loan system. Third. We submit that cooperation succeeds by acts of cooperative respon- sibility, and we recommend that the Congress provide expediently and progres- sively for representation by the shareholders in the directorates of the banks. Fourth. We suggest to the administrative authorities that the most liberal dividends consistent with safe business practice will encourage membership in the loan associations. . Fifth. We recommend that as soon as the needs of small borrowers and the available funds of the system wlU permit, the borrowing limit be raised, by amendment of the act, from $10,000 to $25,000. Sixth. We recommend that the Congress amend the act to permit the joint- stock land banks to issue bonds in the amount of twenty times their capital. Seventh. We urge upon all persons the desirability and absolute safety of Federal farm loan bonds, both as investments for surplus moneys and as fur- nishing substantial assistance to agriculture. Eighth. Be it further resolved. That we approve the recommendation of the Federal Farm Loan Board in its last annual report that the farm loan act be amended to liberalize the purposes for which loans may be made, so that they can be made under the system to any actual farmer to liquidate any indebtedness. INTERNATIONAL CREDIT. We trust that it may not seem inconsistent with prudent policies of state for the United States at the proper time to participate in a con- ference for economic and financial reconstruction in Europe, to the end that we may counsel with the principal customers for our products concerning their present difficulties and future needs; that they may understand our situation ; that we may understand theirs ; and that we may ascertain what we may expediently do, within the limitations of our Constitution and our established American policies, to accom- modate them and ourselves through sourtd credit arrangements by international financial institutions or otherwise in helping to stabilize exchange and thereby to stimulate international trade, which is one of the chief factors in determining the value of our products and in restoring the normal commerce of the world. AGEICUf/TURAL INSURANCE. Whereas the Government, through scientific research, has provided safeguards for agriculture and the live-stock industry against plant and animal diseases ; arid Whereas farmers are subject to the hazaj-ds. of loss from insect depredation or other pests, or loss from the elements, against which they have no adequate means of protection ; and Whereas the furnishing of such protection would greatly stabilize and materially improve the credit risk of our national agriculture. Now, therefore, be it EEPOKT OF THE NATIONAL, AGRICULTTJKAL CONFEKENCE. 141 Resolved, That this national conference on agriculture recommends that the United States Congress talie steps to investigate the subject of crop insurance with the view of determining the practicability, or expediency of creating a crop insurance bureau. TAXATION. We recommend : First. Stringent economy in the administration of our present laws and that further legislation requiring the appropriation of money be subject to the acid test of necessity. Second. A constitutional amendment prohibiting issuance of tax- free securities: Provided, That inasmuch as agricultural lands and mortgages are both taxed, and that agriculture is a fundamental in- dustry upon which all industries depend, nothing in these resolutions shall apply to bonds, debentures, certificates of indebtedness issued under authority of the Federal farm loan act or any amendment thereto. * Third. That if additional revenue be needed we recommend the reenactment of an excess-profits. tax dn corporations. Fourth. That we positively and earnestly protest against any con- sumption, or sales or manufacturers' tax, or any other tax which shifts the burden onto those least able to pay, onto the necessaries of life, and has proved disappointing financially and unjust socially wherever tried. Fifth. That agriculture receive the same just and equitable con- sideration as industry in framing the tariff. REPORT OF COMMITTEE NO. 3, TBANSPORTATION. SECTION A, RAILWAY TRANSPORTATION. On the basis of present agricultural prices existing levels of freight rates on basic agricultural commodities constitute an excessive burden upon the agriculture of the country, and if long continued will result in relocating much of our agricultural production with consequent modification of railroad revenues and revenue-producing centers. Wherefore, it is recommended as follows : 1. That the freight rates on farm products, live stock and the products of allied industries be reduced to the rates in effect August 25, 1920, and that the Interstate Commerce Commission put the above reductions into effect at once, and further reductions as rapidly as reductions in operating expenses will justify. That the carriers be directed to readjust freight rates on other com- modities as quickly as possible upon the basis of what the various classes of traffic will reasonably bear. That those rate relationships between producing districts and markets which existed prior to the application of general percentage or horizontal rate increases, and which destroyed said relationships, unfairly increasing the advan- tages held by certain sections over others, should be corrected, and the relationships should be restored as they existed prior to the war so far as conditions will permit. 2. We believe that section 15-A of the interstate commerce act, containing the provisions as to the fixed amount of return that must 142 EEPOET OF THE NATIONAL AGRICULTURAL CONFERENCE. be provided for if possible on the aggregate value of railroad prop- erties, regardless of the economic conditions, is fundamentally un- sound, and we recommend its immediate repeal in its entirety. 3. The full powers of the State railroad commissions as they ex- isted immediately prior tcf the Federal control of railroads (except as to the control and distribution of cars in interstate commerce) should be restored by act of Congress at the earliest possible date. 4; The railroads are seeking to fix a valuation upon their proper- ties which will include the so-called " land multiple," on the theory that if they had to repurchase such lands to-day the cost of condem-- nation proceedings and damage to adjoining property would compel the payment of more than t«^ice the present value- of their lands. This theoretical basis would increase the present transportation bur- den of a return upon several hundreds of millions of dollars. We urge upon Congress the prompt passage of a law which will effec- tually prevent such a method of valuation. 5. We are opposed to the many abuses that have grown up through violations of the principle of the tong-and-short-haul clause which requires that rates to intermediate points shall not exceed the rates between the more distant points. For many years the iiitermountain States were discriminated against by the charging of more for the short hauls than for the long hauls. This situation has been cor- rected, but to-day there is an effort to change this, and we earnestly recommend to the Interstate Commerce Commission that no change shall be made in the present adjustment. , 6. This committee recognizes the urgent need of extensive and prompt additions to the refrigerator-car equipment of the carriers, and the repairing or rebuilding of much of the present equipment to adequately and safely handle the perishable crops of the country. The committee, therefore, strongly recommends that the carriers give this q^uestion prompt attention ; that as rapidly as conditions permit a sufficient number of new refrigerator cars be built and such part of the present equipment as is inefficient be brought to a state of effi- ciency by repair or rebuilding; that in determining the type of car to build, cars of less efficiency than the standard refrigerator car as adopted by the United States Department of Agriculture and the United States Railroad Administration should not be built. That the same principle govern so far as possible in rebuilding. That refrigerator cars be standardized as to essentia] construction to permit prompt and economical repairs and replacement of parts. 7. That we commend the Interstate Commerce Commission and the railway companies for their recognition of agriculture as the basic industry of the country and for their action in effecting certain general reductions in the freight rates on agricultural products. In conclusion, we insist that the railroad corporations and rail- road labor should share in the deflation in charges now affecting all industries. This is essential to the restoration of normal conditions in agriculture and it is essential to the welfare of the entire com- munity. We earnestly appeal to those in authority to take such action as may be necessary in order to accomplish that result. EEPOBT OF THE NATIONAL AGKICULTUHAL CONFERENCE. 143 SECTION B, WATER TEANSPORTATION. Adequate and cheap transportation is of the highest imporiance for the full development of our agricultural activity, as well as of the economic life of the Nation generally. The facilities afforded by the railways, likely to be taxed to their capacity by the next re- vival of traffic, should be supplemented by and coordinated with a system of waterways which will insure an outlet to the markets of the world for the products of our soil, mines, and factories upon a basis that will enable our producers to compete successfully in those markets. We have built our national institutions with our centers of produc- tion 1,200 to 1,500 miles distant from our principal centers of indus- try and population. This has been brought about through a con- tinuing process of new land settlement with heavy drafts on virgin fertility of soil aided by the remarkable development of labor-saving machinery and the general advancement of agricultural knowledge and processes. Low costs of farm production have enabled the farmer to withstand up to this time the long rail haul on his own commodity, as well as upon his purchases. There has been a con- tinually increasing spread between farm prices and consumers' prices, and this has occasioned serious detriment to the basic producer. A part of this margin is due to costs of transportation. While there can be and must be some reduction in railroad rates, it is not probable that they will ever again reach the prewar basis, and the farmer must look to waterways as an important means of affording relief. We have a system of great rivers and lakes reaching the heart of our great productive areas capable of being developed into economic boat carriers of immense tonnage. In their development lies our greatest hope of reduced transportation costs. Other nations have made far greater progress in the development of their inland water- ways than we have, and they are giving much attention to the fur- ther development of their navigable streams, rather than to the extension of railway systems. In opening this conference, President Harding well stated that — Disorganized and prostrate, the nations of central Europe are even now setting their hands to the development of a great continental waterway, which, connecting the Rhine and Danube, will bring water transportation from the Black to the North Sea, from Mediterranean to Baltic. If nationalist , preju- dices and economic difficulties can be overcome by Europe, they certainly should not be formidable obstacles to an achievement, less expensive, and giving promise of yet greater advantages to the peoples of North America. Not only would the cost of transportation be greatly reduced, but a vast population would be brought overnight In immediate touch with the markets of the entire world. The Government, through activities of the War Department which were instituted before the signing of the armistice, built tows and barges adapted to the upper Slississippi. During and since the war there has been a great increase in navigation on the lower Mississippi River and on the Ohio River. Barges are operating from St. Louis to New Orleans in competition with railroad lines and have demon- strated not only their efficiency but also their economy as carriers of freight. Especial attention should be given to the possibilities of developing the Mississippi River 'as an artery of commerce. It is 92640— H. Doc. 195, 67-2 10 144 EEPORT OF THE NATIONAL AGRICULTUEAL CONFEIUiNCE. capable of affording cheap and rapid transportation, and we ur^e that encouragement be given to those endeavoring to restore this waterway to its rightful position among the transportation routes. The Missouri, Ohio, Ked, and many other rivers possess^ great possibilities. The Government should make liberal appropriations for the proper survey of these streams and for conducting experi- ments in order to determine the most efficient types of boats and barges for each stream and make improvements as indicated by the surveys. Appropriations for this purpose should be made. Every encouragement should be given for the building of proper docks, as well as storage and Avarehousing facilities, wherever a reasonable return can be secured for the money invested. Care should be exer- cised .that the control of all these facilities be held in the best inter- ests of the individual shipper. Particularly should the improvements already under way at Muscle Shoals, on the Tennessee River,, making available electrical power as well as opening the river for naviga- tion for 400 miles, be promptly completed. Shippers should be adecjuately protected in securing fair and equitable rates for water shipment based on the cost of the service and not influenced by rail rates. Joint water and rail rates should be put into effect, and the Government should exercise full control over interstate water shipping, so that all discrimination may be avoided. ^ An International Joint Commission appointed by the authority of our Congress and the Canadian Parliament has for the past two years with the aid of competent engineers been investigating the feasibility of opening the Great Lakes for ocean navigation through improve- ments along the St. Lawrence River. The report of this commission, now before Congress, clearly indicates that it is both feasible and practical to bring ocean carriers into all Great Lakes ports, thus giv- ing the great productive interior of our nation the benefit of direct shipments to the world markets at marine rates. There are no in- surmountable engineering difliciilties to overcome. The estimated cost of the completed work between Montreal and Lake Ontario as recommended by the engineering board is about $252,000,000, to which must be added the cost of the New Welland Ship Canal. Th^ total cost would be divided betAveen the two nations. The engineer- ing board of the International Joint Commission reported that the development will make available 1,500,000 hydroelectrical horse- power. This at a very low rate will amortize the cost, principal and interest, within a period of from 40 to 50 years. We urge that by international treaty and by joint legislation steps be taken to enter immediately upon this most important project. The people of the United .States have invested a large sum of money in the Panama Canal. We strongly recommend that the policy of charging tolls for the passage of ships through this canal be retained. Those sections of the country and those shippers bene- fiting directly from the use of the Panama Canal should bear the cost of its operation without the taxation of those sections of the country receiving no direct benefits therefrom. We direct attention to the necessity of proyiding adequate joint railway terminals at ojir ports fqr the economical and expeditious handling of export and import traffic. As a result of a survey of ' See minority report, p. 201. E.EPOKT OF THE :N'ATI0NAL AGKICULTURAIj CONFERENCE. 145 port facilities of South Atlantic and Gulf ports the Secretary of War and the United States Shipping Board made representations to the Interstate Commerce Commission to the effect that the charges, regulations, and practices of rail carriers at those ports were pre- venting the erection of needed terminal facilities, the natural de- velopment of the ports, the proper building up of our merchant marine, and the economical carrying on of foreign commerce. We urge the prompt establishment of adequate terminal facilities at all ports. Finally, we would emphasize the importance of such control of the development of hydroelectric power that the use of electric cur- rent be made available to the small consumer on the farm and in the village, and not merely to the great industrial centers, at uniform rates to all users. SUPPLEMENTAL KEPOET. Agriculture is our principal basic industry, hence is of first im- portance, and transportation, upon which it must depend, is of second, if not of equal importance ; and the interests of these two great and vital industries are inseparably linked together so that neither can prosper for any length of time at the expense of the other. Hundreds of governmental and private institutions and agencies are being maintained and conducted for the purpose of teaching and conveying information with reference to all phases of produc- tion in agriculture, and the work done by such agencies has re- sulted in enormous benefits not only to the producers but to the public at large. The failure to establish and maintain an adequate number of cor- responding institiitions for the development and study of efficient coordination of all the various phases of transportation in the eco- nomic marketing and distribution of the products of agriculture has been, and is continuing to be, a source of very great waste and loss. We recommend the establishment, independently of Government financial aid, of a national transportation institution under the super- vision of men who stand preeminent throughout the United States for their knowledge of transportation and their known integrity, including an adequate number of repre^entatives of agriculture. Such institution to conduct, through the ablest and most experi- enced men obtainable, research into all phases of every type of trans- portation, including the present condition of each, and as to how and upon what basis the various types of transportation can be co- ordinated to the best advantage of all concerned; and thereafter furnish to the public full and reliable information, free from bias or favoritism for or against any interest; through instruction to students; through addresses before the public by the principals of the institution and its representatives, and through the press. SECTION C, IIIGHWAT TRANSPORTATION. Country highways are the farmers' first and principal transporta- tion means of marketing their products. They are the arteries of the economic and social system of the country. On their condition 146 REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. rests the amount of the transportation charge that must be added to the gross cost of farm product and the more fully they are de- veloped, the less that weather conditions and soil are allowed to clog the flow of. traffic, the greater will be the health of the body politic and the added profusion of enjoyments and privileges to the common people. The loss from bad roads should be reduced to a minimum, not only to enlarge the farmer's market but to shorten the time and reduce the spread of price between the farmer and the consumer. The farmer ought to be able to haul to market twice as much twice as often as he has been able to do it in the past. If the farmer is to be put in a position to help influence the price of his products by not dumping them on the market for fear of unseasonable weather, he must control the condition of the roads to his markets. Without proper road conditions "orderly marketing" can never be accom- plished. Rapid growth of traffic over the highways has been so greatly intensified during the past few years that this method of transportation needs earnest and careful consideration. To this end we urge the closest coordination between the three major forms • of transportation, so that railways, waterways, and highways may each carry the kind of traffic that it can the most economically, ex- peditiously, and efficiently serve. We commend the Department of Agriculture, State highway de- partments, and colleges for their research in connection with highway construction, maintenance, and transport over the highways, and urffe full support be given these investigations. We approve the action of Congress in continuing Federal aid for the building of interstate, postal, and farm-to-market highways un- der the Department of Agriculture and making appropriation "there- for. We "believe this policy to be equitable and constructive. We urge Congress to continue "this policy for a definite period, so that the States may plan adequate cooperation. We call particular attention of Federal and State authorities to the growitig necessity for regulation of traffic on highways in order that they may be protected from excessive and destructive abuse. Eesearch into causes of highway wear should be continued by the Department of Agriculture and State highway departments and traffic regulated according to the facts developed. It is self-evident that farm products are the most cheaply trans- ported over well-kept highways. We, therefore, urge that all possi- ble safeguards should be placed about the maintenance of highways. Safety of life and limb on the highways is paramount, and we favor every effort to make the use of streets and highways less danger- ous to all citizens. We commend the Department of Agriculture for its policy in highway improvement, of providing roads suitable for horse-drawn as well as motorized vehicles, and urge that wherever practicable side roads be constructed adjacent to the metal surface portion of the highway. Rapidly changing traffic conditions on our thoroughfares make the construction and maintenance of our highways an important engi- neering and business undertaking; therefore, all partisan or political consideration must be eliminated. REPORT OF THE NATIONAL AGRlCtTLrtJRAL CONFEfeENCE. 147 REPOIIT OF COMMITTEE NO. 4, FOREIGN COMPETITION AND DEMAND. Resolved, That the conference favor immediate legislation necessary to pro- vide credits for financing the export of surplus agricultural products during the present emergency in so far as it can be done with due regard to general interests. Whereas grain now receives a preferential freight rate when Intended for ex- port : Therefore be it Resolved, That the conference recommend to the Interstate Commerce Com- mission that it Investigate the advisability of extending such preferential rates to other agricultural products for the purpose of promoting foreign trade. Whereas many foreign countries have consolidated their purchases of many basic agricultural products and manufactured products thereof into few and often single agencies, thereby limiting and in many cases eliminating all competition in purchasing our products ; and Whereas agencies handling farm products and manufacturers processing same in this country are in active competition with each other in the sale of our products In such countries ; and Whereas the Webb-Pomerene Act to promote foreign trade is so restrictive In its present terms as to malje it difficult to successfully organize export asso- ciations to meet the concentrated buying in foreign countries ; and Whereas the law as now written requires any association organized under it to be solely and actually engaged in export trade, requiring the financing of such associations and the setting up of elaborate and expensive machinery for carrying on such export trade ; and Whereas many farm associations and manufacturers with established trade- marlis and brands can not enter such export trade associations without vir- tually abandoning their trade-marlis and brands, and their distributive ma- chinery for handling their export business: Therefore- be it Resolved, That this conference recommend that Congress amend the Webb- Pomerene Act so as to broaden the definition of what shall be deemed to be " engaging in export trade," so as to make it possible to facilitate such organi- zations in this country to meet the one-sided situation existing in foreign trade ; that this conference further recommend that the following amendment, recently introduced by Senator' Fletcher, of Florida, and now pending before the Senate Committee on Interstate Commerce, be adopted : " An association shall be deemed to be engaged in export trade for the pur- poses of this act if it shall promote agreement among its members as to the prices and terms which shall govern the sale of their products to foreign cus- tomers, engage in trade promotion abroad, transmit to its members inquiries of orders received from foreign customers for the purchase of their products, agree as to terms of credit and as to the allowance or refusal of credit or of sales to foreign customers, and generally promote such agreements and under- standings among its members as are necessary to protect them from hurtful combination and practices of foreign competitors or customers." Whereas a supply of potash at a reasonable price is necessary and essential to profitable farming in many sections of the United States : Therefore be it Resolved, That this conference considers that the imposition of a tariff on potash would be detrimental to the agricultural interests of the Nation and therefore opposes the placing of any duty or tariff thereon; that this confer- ence recommend that in all tariff legislation full recognition should be given to the fact that every consideration justifying the imposition of duties on other importations applies with special force to all agricultural products which are produced in other countries on a cost basis greatly below costs prevail ng in this country, and that the permanent tariff and all adjustments thereof should give us as full protection to American agriculture as is given in other industries. Resolved, That it is the sense of the National Agricultural Conference that the time has been reached in the development and history of this Nation when the question of the tariff should be removed from the domain of partisan polit'cs and the vicissitudes incident to changing political control of the Government; that the welfare of the agricultural, industrial, and commercial interests of this country demand the fixing of a permanent policy in relation to this vital question. 148 REPORT OF THE NATIONAL AGRICULTTTKAL CONFERENCE. It is therefore recommended that Congress as soon as practicable shall create by appropriate legislation a permanent tariff adjustment board, to be appointed by the President and confirmed by the Senate, with such emolument and tenure of office as will remove them from political influence and personal interest; that such board shall be separate and distinct from the present Tariff Com- mission, the duties of which should be so modified as to require reports of its Investigations to be made to the tariff adjustment board in addition to the reports it is now required to make under the law. It is further recommended that Congress likewise proceed to enact perma- nent tariff legislataion which should be so framed as to permit adjustment of individual rates or particular schedules of rates within prescribed limitations, and authorize changes therein from time to time by said tariff adjustment board, and thus provide a reasonable latitude in the application of tariff rates to any commodity in the adjustment of said rates to the varying fluctua- tions of agricultural and industrial trade conditions, and emergencies caused by fluctuations in exchange or other causes, without the necessity of a general re- vision of the tariff, as now required under the present system. It is further recommended that it shall be made the duty of said tariff adjust- ment board to apply the tariff acts of Congress and fix just and reasonable rates with prescribed limitations to meet changing conditions and in accordance with definite principles set forth in the act. That among the principles that should control in framing such legislation and in the adjustment of rates and schedules the following should be included : (o) Reasonable protection of American agriculture and other industries that are subject to destructive competition from abroad and that are or promise to be of benefit to the country as a whole or to any considerable section thereof. (6) Meeting discriminatory or unreasonable tariffs or regulations, direct or indirect, against the products pi this country. (c) The prevention of dumping of foreign goods into this country to the injury of our markets. id) Maintenance and encouragement of export trade. (e) Promotion of the interest of the American public as a whole, as well as due consideration of relative standards of living, earnings, and efficiency of labor in this and other countries. Whereas prompt information and facts concerning production, supply, and de- mand in foreign countries, as well as knowledge of costs and other factors affecting production, are of vital necessity if American farmers are to properly adjust their programs of production and marketing to meet the changing conditions of supply and demand and develop a sound future agricultural export policy : Therefore be it Resolved, that this conference recommends: (a) That adequate support be given to the International Institute of Agriculture at Rome in order to facili- tate the prompt collection of more and better agricultural statistics in foreign countries and develop uniform methods of crop reporting ; and that provision be made for the sending of five delegates to the next general assembly of the institute to be held at Rome in May, 1922. (6) That authority be granted by Congress in the immediate future for the appointment of agricultural attaches to our embassies in the principal foreign countries producing and consuming agricultural products, for the purpose of gathering and forwarding promptly by cable, wireless, or otherwise data con- cerning the area and production of crops, live-stock production, surpluses and deficits, exports and imports, as well as information concerning the factors affecting present and future production, supply and demand, prices, and general agricultural development ; such attaches to be men thoroughly trained and experienced along agricultural and economic lines and skilled in the interpreta- tion of farm facts. EEPORT OP COMMITTEE NO. 5, COSTS, PRICES, AND ADJUSTMENTS. Space is not available for this committee to attempt to present detailed figures as to the present situation of the farmer. Intimate acquaintance by the various members with the actual conditions in the chief agricultural regions — such as the wheat area, the corn belt, EEPOET OF THE NATIONAL AGRICULTURAL CONFERENCE. 149 the range country, the cotton belt, the dairy sections, and others — demonstrates the very serious plight of the farmer as a result of the collapse of the prices of the farm products, while the costs of items which enter into their production have fallen relatively little or, in some cases, not at all. This first-hand information is amply borne out by cost of production figures gathered by the Department of Agriculture^ various State agencies, accounts kept by farmers on their own business operations, and by the investigations made by the Congressional Joint Commission on Agricultural Inquiry. The result of this has been that the farmer is receiving on his invested capital a very scant return or no return at all, and for his labor and that of his family a return which is not only far below current industrial wages, but in many cases even falls below a decent level of subsistence. There can be no restoration of national prosperity until both wages and capital which enter into the production of the commodities which the farmer buys bear their mutual and just share in the general process of readjustment. Conditions have now become so serious that productive capital is impaired, and unless prompt relief is secured the farmers' ability to continue production on an efficient basis will be seriously curtailed. Such a breakdown in farm production would be a national disaster from which every other business interest and every private individual would suffer as well as the farmer. Action to bring about a more favorable agricultural situation must be looked for from two directions: First, from the farmer himself; and, second, from other interests directly related. WHAT THE FARMER MUST DO FOR HIMSELF. The farmer should continue the movement already so well begun toward reducing his overhead expenses so far as possible by develop- ing for his family a more completely self-sufficing farm organization. With the present high level of freight rates, this policy of greater self-sufficiency could wisely be extended *to regions as well as to the individual farm. This would include an increase in crop produc- tion in crop deficiency areas and a reduction of crop acreage and an increase in live stock in regions now producing crop surpluses. This will develop a proper balance of crop acreages and should be ac- companied by increased efficiency in crop production. This increased efficiency and reduction in cost may be obtained in part by greatly increasing the proportion of legumes to other crops and thus main- taining, and even building up, present soil fertility, and with the use of better cropping systems, better soil treatment, and better care of crops, produce increased yields in future years at minimum cost. The farmer can help himself by proper diversification of crop and live stock. enterprises, by adjusting farm operations to market de- mands, by the use of improved varieties of crops and of pure-bred live stock, by producing a larger part of the family living on the farm, by effecting reductions in the cost of farm operations, by the elimination of unnecessary expenses, and by cooperating with his fellow farmers in the marketing, grading, and standardizing of his crops. If he will do these things, and will keep a record of his business with a view to the elimination of unprofitable enterprises 150 REPORT OF THE, NATIONAL AGRICULTURAL CONFERENCE. and to the direction of his efforts along more profitable lines, he will be making his full contribution toward the restoration of the agri- culture of the country to a permanently profitable basis. But after the farmer has done all that he can to work out his own salvation certain aid and sympathetic cooperation must be given by other agencies and interest. 1. He must look to various governmental agencies to direct and assist in the work of combating serious insect and other pests which interfere with agricultural production ; the boll weevil and pink boll- worm in the South, wheat rust and the serious menace of the corn borer in the North, Central, and West, tuberculosis and other diseases of cattle, and various others which cut down returns and increase costs. 2. He must have full information on which to guide his productive and distributive operations. Extension of the statistical divisions of the United States Department of Agriculture and of State agencies so as to furnish the basis for a sound agricultural program, which necessarily must include information on cost of production of farm products, domestic production, and rate of marketing, and such in- formation from foreign countries as will give an accurate index to export demand. There is needed, further, an extension of the activi- ties in the field service of the Department of Agriculture and of the Consular Service in stimulating the demands for agricultural products in foreign countries. 3. The farmer must secure effective aid through numerous farmers' organizations designed to perform commercial services of selling his product or buying farm supplies and through general associations designed to carry on educational or other constructive efforts in the interests of the agricultural industry. 4. Intelligent efforts must also be made to develop consumptive markets for American agricultural products, to prevent adulteration and the use of substitutes, and to develop all possible manufacturing utilization of agricultural by-products. 5. Probably the chief source of relief which the farmer may right- fully expectand demand is in the form of readjustment between prices of products which he buys and those which he sells. This is pre- vented at the present time by distributors' spreads far in excess of any income which the'f armer is able to receive, and by high industrial wages and freight rates. It is imperative that the farmer have re- duced transportation costs. The following reports of subcommittees of committee No. 5 were read for the information of the conference : REPORT OF SUBCOMMITTEE 5A ON COSTS, PRICES, AND READJUSTMENTS IN THE COTTON BELT. Owing to varying conditions in different parts of the cotton -belt, and especially to factors of boll-weevil infestation, land fertility, and the use of fertilizers, the cost of production of cotton varies so tre mendously that it is impossible to discuss it adequately in a brief committee report. Your committee, however, believes that it would be helpful to discuss some of the conditions f6und in cotton produc- tion at present in order that the Nation and world may understand the extent in which this industry is threatened by present conditions. BEPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. 151 The crop of 1920 was made at a higher production cost than any previous crop and the prices received for it were admittedly far be- low the cost of production. The crop of 1921 was made at a some- what lower production cost, but turned out only about two-thirds of a recent average production, and prices have again been much below the cost of production. Two years of such conditions have destroyed a large part of the capital invested in cotton production, have faced a large proportion of the landowners, merchants, and fertilizer com- panies with bankruptcy, and have left a large proportion of the banks in a position where, but for the support of the Federal reserve system, the War Finance Corporation, and other outside capital, they would be unable to function. The boll weevil is now present in every pro- ducing State of the cotton belt except Missouri and Virginia, and has covered fully seven-eighths of the acreage devoted to cotton. During the past year its ravages (while not exclusively responsible for the small crop) greatly reduced the production iii every large producing -State except North Carolina. The outlook for production the coming year is not good. The South has thus far experienced a winter almost as warm as last, a condition most favorable to the hibernating weevil. A large propor- tion of the farmers not only lack the funds or credit with which to procure fertilizers and labor, but are discouraged at the outlook for production and prices. It may be helpful at this point to give a typical illustration of the outlook for landowner and tenant. Let us take a 30- acre farm unit, valued at $1,500 and including 25 acres of cleared land. This is occu- pied by a tenant farmer who furnishes all the implements and labor, including mule power, and receives half the cotton and all the grain crop for his services. The landlord's account will appear about as follows : Landlord's account : Debit- Taxes $25. 00 Interest and depreciation 150. 00 Fertilizer for cdtton 90. 00 Cotton seed 10. 00 Half of cost of ginning and baling 12. 50 Supervision 100. 00 Total 387. 50 Credit— One-half of 5 bales of cotton at 16 cents a pound 200. 00 Two and one-half tons cotton seed at $30 ^ 75. 00 Total 275.00 Landlord's loss 112. 50 Tenant's account: Debit- Feed of mule 75.00 Depreciation and interest on mule 25. 00 Taxes 5.00 Fertilizer for 10 acres corn and grain, at $3 30.00 Depreciation and repairs, implements 10. 00 Half of cost of ginning and baling 12. 50 ■ Total ^ 157. 50 152 REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. Tenant's account — Continued. Credit— One-half of 5 bales of cotton at 16 cents a pound $200. 00 75 bushels of corn 50.00 100 bushels of oats 50.00 2 tons of hay 40.00 Total 340.00 Return received by tenant 182. 50 The balance of $182.50 represents labor for the entire year for man, wife, and two children, which is 61 cents per day for 300 days. On a 365-day basis, this gives a total revenue of 10 cents per day for each member of the tenant's family of four. That these figures are not overdrawn can be readily proven by reference to the production statistics of the Department of Agriculture which are readily avail- able. The Census Bureau reports 1,890,000 farms producing cotton in 1919. This for the crop of 1921 would give 4^ bales per farm. Assuming only one family per farm (a totally unwarranted con- clusion) this would give each share-cropping farmer 2^ bales or a revenue of $170 from cotton. What would the cost of production of farm products be if farm labor were allowed a wage commensurate to that received by the coal miner, the railroad worker, the brick mason, or the factory operative? Your committee has not the data upon which to base this calculation, but states without fear of contradiction that no price received, even at the peak prices, will give the actual producer of farm products a wage comparable in any way with that normally received by all classes of union labor and even by most classes of farm labor elsewhere in the United States. The boll weevil having practically covered the cotton belt, and the pink bollworm having been discovered at various points in the western part of" the belt, the future hazards in cotton production are greater than ever before. A high production can be kept up only by a much higher range of prices than those prevailing in the past. Those in close touch with the cotton situation have no fear that the recent overproduction — or rather underconsumption due to world poverty caused by war — will continue, but rather are they concerned as to how to keep the cotton industry producing in sufficient volume to maintain a prosperous and well-balanced southern agriculture. It is true that present conditions, caused by a temporary undercon- sumption, have caused a most serious situation, and this situation must be met by a decreased acreage for 1922 and by financial measures to prevent dumping of the temporary surplus upon the market until demand overtakes supply. Diversification of crops and the production of ample — but not ex- icessive — supplies of foodstuffs and live stock should be encouraged in the cotton belt by every agency interested in the industry. Such a policy, while vital in the present emergency, is desirable at all times, for a normal acreage of cotton can not be planted, cultivated, and promptly gathered under boU-weevil conditions. The cost of cotton production can, to a certain extent, be reduced and the yields in- creased by educating the farmers of the belt in the proper use of fertilizers, the value of seed breeding, and the use of well-bred varieties of uniform staple and good character, and also by giving REPORT OF THE NATIONAL AGKICITLTURAL CONFERENCE. 153 the farmers access to full information as to the best methods of farm management and diversification. This can best be accomplished by greatly increasing the scope of the extension service of the cotton States and according it ample support. Attention is called to the growth of cooperative marketing in the cotton industry and the economic saving therefrom. We indorse the continuance and expansion of this movement and the action of the War Finance Corporation in supporting these organizations. We recommend that this corporation be continued until other measures to furnish adequate financial support be devised and put into operation. Especial attention is called to the problem of the pink boUworm, and your committee recommends that the Department of Agriculture continue its investigations of the situation created by the invasion of this new pest, determine whether it is possible to eliminate or control it, and immediately go to Congress for the necessary appropriation, however large, for complete elimination or effective control. We make the same recommendation with reference to the boll weevil. The history of the pink bollworm in Egypt and in Mexico indicates that should it become firmly established in this country with its ravages added to those of the boll weevil, it is unlikely that cotton production can be profitably continued at any prices which the world may be willing or able to pay for the product. High transportation charges add to the cost of production of cotton just as they do to the cost of production of every other commodity, and the cotton grower feels that the earliest possible steps should be taken to reduce this burden, and we protest any increase in rates through any proposed readjustment of rates. Your committee would like to call your attention to the fact that a very high return for labor in the railroad, coal mining, building trades, and other industries has a very definite effect in the cost of production for cotton and is a factor in keeping wages and returns in the cotton industry at the present scandalously low level. It Avould also call attention to the fact that the great cotton-pro- ducing industry, except in minor sections, can not be helped by a tariff'. The tariff on cottonseed oil has, according to the best opinion of many students of that industry, been harmful rather than helpful to the producer. A tariff, when laid upon a product which must be purchased by the cotton producer, adds to his cost of production and reduces the return upon his labor and investment. A particular case in point will be the tariff on potash salts, a commodity which is indispensable to the production of cotton over large areas. EEPOKT OP SUBCOMMITTEE 5B ON COSTS, PRICES, AND READJUSTMENTS IN THE WHEAT REGIONS. It is increasingly and painfully evident that the price of wheat must be increased relative to the price of other conamodities if the wheat-growing farmer is to continue to maintain his industry and •fulfill his task of feeding the population of the United States, not to mention the production of an exportable surplus. Action to bring about a more favorable price for wheat relative to that of other com- modities must be looked for from two directions — first, from the farmer himself, and second, from other industries directly and indi- 154 BEPOET OF THE NATIONAL AGEICXJLTURAL CONFERENCE. rectly related. The farmer already has suffered complete and cruelly rapid deflation. He can now only decrease his acreage and increase his efficiency in such ways as are possible. Other industries must follow him in the matter of deflation and reorganization to accom- plish substantial parity between the returns from agriculture and those from other occupations. i. RECOMMENDED ACTION TO BE TAIfEN BY FARMERS. (a) deduction of acreage. — Wheat acreage and production were greatly expanded during the war under the patriotic stimulus of war- time necessity. Acreage has been reduced from the high-water mark of approximately 75,700,000 acres in 191J: to approximately 61,100,000 acres in 1920 and 62,400,000 acres in 1921. Production has decreased from approximately 968,000,000 budiels in 1919 to approximately 833,000,000 in 1920 and approximately 795,000,000 bushels in 1921. In the light of increasing production abroad it is recommended that farmers reduce their acreage of wheat 15 per cent in order to bring back the acreage somewhere near that planted to wheat previous to the war. (&) Substitution for wheat in the proposed reduction. — In the drier portions of the United States, both in the Great Plains area and west of the Rocky Mountains, the acreage not used for wheat should be summer fallowed. In the more humid areas this acreage should be sown to cover crops for green manure or resown in pasture to increase soil fertility and help in controlling weeds, insects, and fungous diseases. (c) Reduction of expenses. — During this period of financial stress the farmer should continue to do what he did so well in 1921 in re- ducing his overhead expenses and in a more completely self-sufficing organization of his farm industry. This will be accomplished through growing, as far as possible, all that he needs to eat, through the reduction of expenses for hired labor, and through the repairing of his present equipment rather than the purchase of new. 2. ASSISTANCE FROM OTHER INDUSTRIES. The farmer has pocketed his losses, tightened his belt, and " car- ried on." He has a right, therefore, to ask the other industries to do likewise in order that his losses may cease, his profits be restored, and his purchasing power return to normal. This applies to prac- tically all the major commodities which the farmer uses — namely, fuels, fabrics, implements, hardware, leather goods, etc. {a) There should be an immediate and substantial reduction in railroad rates,, the present high cost of which is one of the most grievous burdens of the agricultural industry. The chief item in uie cost of transportation doubtless is railway labor wages, which should be reduced proportionately as railroad rates are reduced. (J) There should be an immediate and proportionate reduction in the cost of manufactured articles which farmers must purchase. (c) The American grain farmer should have adequate tariff pro- tection. {d) Any and all doubts as to the legal right of farmers to market their products through cooperative associations of their own for- mation and under their own control should be swept away by clear- cut national legislation. REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. 155 (e) Agricultural credit. It is recommended that necessary steps through legislation be taken to organize and expand agricultural credit to meet the necessities of this large and basic industry in order that_ it may share the advantages which other industries have in the stabilization of production and marketing. (/) Land utilization. Under present conditions we are opposed to further reclaiming at public expense of additional areas of land. 3. INCREASED SERVICE TO AGRICULTURE. It is earnestly recommended that these services now being ren- dered to agriculture by Federal and State agencies be increased, and extended and that the appropriations necessary thereto be in- creased to meet these requirements. (a) Statistical service on production and marketing. — It is rec- ommended that the collection and publication of crop and live-stock statistics and the collection and dissemination of market informa- tion be organized and expanded in order that the farmer may have the benefit of prompt, complete, and accurate information on these matters vital to the organization of his own farming enterprise. (6) Increased research. — It is recommended that Federal and State agencies be adequately financed for agricultural research and investigation on the improvement of crops and live stock, the man- agement of soils, and the control of crop and animal diseases, in- sects, and weeds. JOINT COMMISSION ON AGRICULTURAL INQUIRY. We heartily indorse the report of the Joint Congressional Com- mission on Agricultural Inquiry so far as published and urge that the remaining information gathered by them be made available as promptly as possible. ItEPOET OF SUBCOMMITTEE 50 03S' COSTS, PRICES, AND_ READJUSTMENTS IN THE 'corn belt. The subcommittee on costs, prices, and readjustments in the corn belt has considered the problems of the corn-belt farmer and makes the following statement of conditions and recommendations : The corn-belt problem centers in corn costs and prices, corn being the basis of its live-stock industry and a ruling factor in the price of other grain crops. Corn which costs the farmer from 50 to 60 cents a bushel to produce is now selling at from 25 to 40 cents, with a purchasing power lower than ever before recorded, the average purchasing power of his products being about 67 per cent of the pre- war normal, while he is paying 150 per cent of the prewar normal for labor, 147 per cent for farm implements, and 175 to 230 per cent for transportation. We commend the action of the President of the United States and the Secretary of Agriculture in calling together the National Agri- cultural Conference to consider the agricultural situation and at- tempt to formulate remedies. We recommend : 1. A proper balance of crop acreages, with increased efficiency in production, rather than any general reduction in the. acreage of specific crops. This increased efficiency and reduced cost of produc- 156 REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. tion may be obtained in part by greatly increasing the proportion of legumes to other crops, thus maintainijig soil fertility, and with the use of better cropping systems, better soil treatment, and better care of crops. On the other hand, giving less care or poorer treatment may increase the cost per bushel by lowering acre yield. 2. That the farmer practice greater efficiency in business and private life by a proper balance and diversification of crop and li¥e- stock enterprises, by adjusting farm operations to market demands, by the use of improved varieties of crops and of pure-bred live stock, by producing a large part of the family living on the farm, by effect- ing reductions in the cost of farm operations, and by the elimination of unnecessary expense. 3. Legislative recognition of the right of farmers to market their products cooperatively and an extension of the Federal licenses ware- house and storage system. 4. The establishment of supplemental farm-credit facilities run- ning for periods of from six months to three years, with a recognition of the adde value of pure-bred live stock as a basis for credit. ■ 5. Extension of the statistical divisions of the United Sta,tes De- partment of Agriculture and of State agencies so as to furnish the basis for a sound agricultural program, which necessarily must in- clude information on fost of production of farm products, domestic production and rate of marketing, and such information from foreign countries as will give an accurate index to export demand. We recommend, further, the extension of the activities in the field service of the Department of Agriculture and of the consular service in stimulating the demands for agricultural products in foreign coun- tries. 6. Consideration by Congress of legislation to stimulate increased exports of agricultural products by allowing interest credits on European debts in the sums spent by debtor countries for the pur- chase of agricultural products in the United States. 7. We recognize the value .of farm organizations in promoting the farmer's welfare and recommend more active participation in them. 8. Que of the greatest needs of the corn-belt farmer is reduced transportation costs. To accomplish this end, we recommend (a) the immediate repeal or amendment of the Adamson law covering the national agreements, the savings thus effected to be immediately reflected in reduction of freight rates; (b) the repeal of the guaranty clause of the Esch-Cummins law; (e) the improvement of farm-to- market roads; and (d) the development of inland waterways, especially the St. Lawrence deep- waterways project. 9. Believing that the retail dealer, who exists in numbers entirely out of proportion to the customers he serves, with resulting un- necesarily high costs of operation, is the worst offender in the chain between producer and customer, we urge on Federal authorities the importance of a more effectiye enforcement of existing laws concern- ing profiteering, not only in food products but in a,U commodities. We favor the enactment of laws providing for Federal licensing of all retail dealers, Avith a limitation of selling prices to a moderate increase over costs, to the end that retail establishments may be re- duced to the number which will serve both consumer and produceir most economically. EEPORT OF THE KATIONAL AGRICULTURAL CONFERENCE. 157 REPORT OF SUBCOMMITTEE 5D ON COSTS, TRICES, AND READJUSTMENTS IN THE DAIRY REGIONS. The cost of production of dairy products steadily increased until 18 months ago. In spite of the recent reduction in the cost of feed- ing material, the cost is still largely in excess of that in 1914. The dairy industry is now in a period of declining prices. This will prove serious to the entire industry and disastrous to many if it con- tinues unless accompanied by important readjustments. We would point out that the cost of labor, of machinery, of equip- ment, and the fixed charges on investments are still high and must be reduced, as they are large factors in preventing serious loss to dairying. KEADJUSTMENTS. Whereas low-price feed and frequent cash income for milk and cream are stimulating increased production, which with other factors have reduced prices of dairy products : Therefore be it Resolved, (1) That it is important that the cost of production must be reduced by developing more efficient dairy practices, .especially through the elimination of poor cows and better feeding and breeding. 2. The greater uniformity and excellence of quality must be developed. 3. That all agencies, public and private, emphasize the need of milk products in human diets and encourage consumption for the public good, in keeping with the suggestion of the newer scientific research. 4. That due consideration of these facts should influence the selection of foodstuffs for shipment to the needy of Europe. 5. That the eradication of contagious diseases, particularly tuberculosis and contagious abortion, is essential to a lower cost of a necessary human food and justifies increased expenditures of public funds. Whereas the prices of market milk were much higher when the present freight rates were made, the decline in the prices of market milk makes the freight rates relatively 100 per cent higher — that is, in comparison with the prices which the producer receives for market milk now. The same principle ap- plies in varying degrees to other dairy products: Therefore be it Resolved, That we urge a reduction in the rate consistent with the mainte- nance of efficient public carrier service. LEGISLATION NEEDED. We respectfully submit the following resolutions and urge their adoption by the full committee and by the committee on costs, prices, and readjustments: Resolved, That the Senate of the United States is hereby requested and urged to pass the Capper- Volstead cooperative marketing bill in substantially the same text as it passed the House of Representatives. Resolved, That the manufacture, sale, and use of food compounds consisting of milk with the butter fat taken therefrom and vegetable oil substituted therefor is a growing menace to the public health and to the dairy industry of the country, and that this conference urge the enactment of laws to prohibit the manufacture of imitation dairy products. Resolved, That we ask for a Federal law defining adulteration of commercial compound feeding stuffs sold in interstate commerce and requiring manufac- turers and dealers therein to furnish the Department of Agriculture with for- mulse showing materials used and proportions of each, subject to the inspection of said department. Resolved, That we urge the enactment of a schedule of tariff rates which will ac^aquately protect the American dairy industry, based on a rate of not less than 10 cents a pound on butter and with the duty on other dairy products in line with the rate on butter. 158 KEPORT OF THE NATIONAL, AGEICULTXJRAL CONFERENCE. REPORT OF SUBCOMMITTEE SE ON COSTS, PRICES, AND READJUSTMENTS IN THE RANGE OOUNTKT. We believe that a constructive national live-stock policy to relieve the present distressed situation in .the live-stock industry should extend from the birth of the animal on the range or farm to the plate of the consumer and should include the following provisions : 1. Provision for more adequately financing live-stock producers with special provisions for men of small live-stock holdings. This should be provided for by legislation, extending the present powers of the War Finance Corporation in the following respects : (a) An extension of time of at least one year in which applications for loans under the present law may be made. (b) Legislation which will authorize the War Finance Corpora- tion in extending credits to live-stock producers to take into consid- eration lands owned or leased or equity therein and the improvements thereon as additional security, and provisions for making loans di- rect to borrowers wherever and whenever regular banking or loan company facilities are not available to such borrowers. (c) Provision that for the purpose of properly maturing stock loans should be made for a period of not exceeding five years and interest at a rate not exceeding 7 per cent. FREIGHT RATES. 2. We demand reduction of live-stock freight rates by removal of advances made in Ex parte 74, and further reductions to the pre- war rates as nearly as possible, and as reduction in operations ex- penses may justify, so as to be commensurate with the present prices of live stock, and further that railroads be allowed by the Labor Board the opportunity to employ labor at reasonable wages and with reasonable rules, which will enable such reduction of operating ex- penses that the railroads can be required while earning a fair return to make rates that will afford the opportunity for live-stock producers to likewise make a fair return for their labor and investment, which under present prices and costs is impossible. COOPEEATIVE ASSOCIATIONS. The thorough organization of live-stock producers into county and State associations, cooperating in matters of national policy through national associations, and the regular distribution to mem- bers of such association through Government cooperation complete information as to market, feed, and transportation conditions, co- operating and furnishing this information whenever practicable with the existing farm and live-stock organizations. We also en- courage the plan for cooperative shipping and marketing live stock as worked out by the farmer's live-stock committee of 1915. (a) The establishment through the above associations of a prac- ticable exchange system by which the demands of feeder communi- ties may be promptly supplied by the range and breeding districts and the supply and class of feeders fitted to the demand. KEPORT OF THE NATIONAL, AGRICULTURAL CONFERENCE. 159 INDORSE PACKERS AND STOCKYARDS ACT. (6) We indorse the packer and stockyards act, which provides for such thorough and practical supervision of stockyards as shall insure high standards of prompt, impartial, and efficient service, including feed supplies of proper quality at just prices, ample water and weigh- ing facilities, impartial allotment of space, proper returns for dead or injured animals, and every opportunity for open and competitive marketing, and recommend prompt reduction of existing yardage, live-stock commission charges, and schedules to reasonable levels. NATIONAL FOREST POLICY. 5. We are opposed to any transfer of the administration of graz- ing on national forests from under the jurisdiction of the Depart- ment of Agriculture. We favor the appraisal of grazing values on the different national forests, but we maintain that the present fees charged shall be the maximum charge and that in such cases where reappraisals are made that any readjustment of grazing fees shall be downward for inferior forests and not upward for superior for- ests, until at least such time as the live-stock grazing industry is on a profitable basis. STANDARD GRADING. 6. We recommend that the Secretary of Agriculture as soon as possible inaugurate a system whereby all animals, meat products, and wool may be classified and brought to standard grades. FRENCH-CAPPER TRUTH IN FABRICS BILL. 7. We recommend the passage by Congress at the earliest possible moment of the French-Capper truth in fabrics bill, now pending in Congress. EDUCATION ON MEAT CONSUMPTION. 8. We indorse an educational campaign looking toward increased consumption of meats and meat products, setting forth the food values of said meats and meat products. PRICES OF MEATS AND MEAT PRODUCTS. 9. We again call attention to the wide and unreasonable spre&d between the prices received by the live-stock producers and the prices paid by the ultimate consumers for live-stock products. 10. Because of depreciated foreign exchange and its effect in sub- sidizing exports to the Uilited States, to the detriment of American ao-riculture and industry, we favor the American valuation plan be applied to importations into the United States. After mature investigation in full detail of necessary tariff rates properly protective to the live-stock industry, we recommend the following duties : 92640— H. Doc. 195, 67-2 11 160 BEPOKT OF THE NATIONAL AGRICULTTJEAL CONFERENCE. On meat and meat products, 20 per cent ad valorem, with a niini- mum of 4 cents per pound; live cattle, 30 cents ad valorem; hides, dry, 6 cents per pound ; green, 3 cents per pound, with an ad valorem minimum of 20 cents; wool used for clothing or wearing apparel purposes in whatever form, imported, 33 cents per pound of clean content ; mutton, 3 cents per pound ; lamb, 5 cents per pound ; live sheep, $2 per head. KEPOET OF SUBCOMMITTEE 5F ON COSTS, PRICES, AND READJUSTMENTS IN THE TOBACCO DISTRICTS. Subcommittee (5F) on costs, prices, and readjustments in the to- bacco districts has carefully considered the subjects, and wish to submit the following recommendations for your consideration in preparing your report to the National Agricultural Conference : The committee recommends that the Federal Government, in co- operation with State agencies, conduct such investigations as may be necessary to determine the most economic methods of producing and marketing tobacco, particularly with respect to — (a) Statistics on cost and amount of production, stocks on hand, and rate of consumption by form, types, and grades as far as prac- ticable. (b) Information relative to varieties of tobacco most suitable for particular soils, kinds of fertilizer most suitable, and the best methods of controlling insect pests and plant diseases. (c) Establishing standards for the classification of tobacco of the different types. (d) Standardizing the warehouse system under appropriate regu- lations. REPORT or SUBCOMMITTEE 50 ON COSTS, PRICES, AND READJUSTMENTS IN SUGAR PRODUCTION. It is impossible, with the cost of production as it is in the United States, for the growers of either sugar cane or sugar beets to meet the costs of Cuba and other tropical countries, and since the price of sugar depends upon the price the Cuban producer may charge and as through cheaper labor he has greatly reduced his costs and increased his production until he can furnish all the sugar the United States can consume, it is necessary for a complete readjustment to be made of the conditions governing the agricultural position of this industry in this country. It is the unanimous opinion of this committee that this readjust- ment must consist of a change in the tariff now in effect against tropical sugars. To meet the competition of other crops and give adequate in- ducement to the American sugar farmer, a tariff of $2 a hundred pounds must be levied against sugar coming from Cuba. Any re- duction from this figure reduces directly the return from the farm. From a study of the history of sugar production and consumption in this country, we boldly affirm that this increased tariff will be for the benefit of the consumer of food in this country, as well as the consumer of sugar, as it has been demonstrated more than once and recently quite acutely that but for the competition of the American REPORT OF THE NATIONAL AGEICtJLTUKAL CONFEEENCE. 161 production the cost of sugar to the consumer would be considerably higher than when the source of supply was so restricted. In addition to this, one of the lessons we learned from the war was that this country should be self-sustaining as far as its food supply is concerned, and right painfully all of us remember how we were seriously hampered because of a great shortage of this important food. THIS MUST NEVER HAPPEN AGAIN. Further, as an evidence of the necessity of such a tariff, the pro- ducers of cane sugar have been told by their bankers that any measure of tariff less than that asked for will result in their complete with- drawal of financial support. Further, that the study of beet-sugar production in this and for- eign countries has demonstrated that the effect of the growing of sugar beets in the cycle of crop rotation has proved most beneficial and should be encouraged as one of the methods of increasing our acreage production of food products. Resolved unanimously, That a material increase be made in tlie appropriation for the scientific investigation of the technical problems that are involved in safeguarding and developing the growing and marketing of our sugar crops. REPORT OF SUBCOMMITTEE 5H ON COSTS, PRICES, AND READJUSTMENTS IN FRUIT AND VEGETABLE PRODUCTION. We find that the cost of production and prices vary so much with local conditions and geographical placement that we can submit no report that would be of value along these lines. Marketing conditions must be improved and taken advantage of along with the institution of the best methods of production to in- sure a profit. We find certain fixed expenses over which the grower exercises little or no control. These costs are of labor, packages, freight or express, drayage, and commission. All of these, except the last, vary little with light or heavy crops when considered on a package basis. xour committee finds that present high freight rates is the large and important factor standing in the way of a return to normal conditions. Long-distance shipments are ofttimes prohibited by the freight rates, and numerous instances can be cited where grow- ing crops would have been a less loss to the producers if they had been left to rot upon the ground. As an instance of inequality between rail and water rates of transportation, it was stated to the committee that apples were sold to the canners at Pacific coast points for from $17 to $20 per ton, then canned and shipped to New York City by vessel on a rate of freight equal in amount to the rate by rail from Eochester to New York City, where they came into competition with canned apples taking the same rate of freight and sold to Eochester canners from $45 to $60 per ton for the apples at the cannery. With reference to long-distance rates by rail, we find that ship- ments are being curtailed on account of excessive freight rates and that production is being put out of business, which is alike injurious to the producer and consumer. Short-distance rates are increased to such an amount that much of this freight is being handled by trticks. With the building of hard roads, therefore, the railroads 162 REPOKT OF THE NATIONAL AGRICULTURAL CONFERENCE. are pursuing the foolish policy of destroying or at least seriously injuring both long and short hauls to market by such high freight Complaints were made to our committee that the grower often found it impossible to secure adequate warehousing facilities for his produce and consequently his product was often thrown onto the market at a loss. ■ i n • Shipments of lemons have been made from Italy as ballast m ships returning to this country and have sold on our Eastern mar- kets at very low prices, to the great detriment of our own growers, but returning to the Italian shipper a price, owing to rates of ex- change, of over $.5 net per box— a profit greater than the foreign shipper ever realized before. Much complaint was made to the committee of numerous in- stances of fraud and fraudulent returns for produce shipped on consignment to commission firms in various cities. Small shippers are at the mercy of the commission merchant. Losses have been sustained by growers who shipped produce to market in packages other than those to which thp market was familiar; and also losses are incurred through lack of proper grading. Your committee on cost, prices, and readjustments of fruit and vegetable production recommends the following : 1. The standardizing of the grading of fruit and vegetables and of packages to secure uniformity, and the marking of packages indi- cating quantity and quality of contents. 2. In order to secure a better demand and price for the better grades of produce we recommend the utilizing of inferior grades by manufacture into by-products, thereby conserving valuable food and removing competition in the open markets. 3. For the use of shippers and the better cooperation among local, regional, and national agricultural organizations for the purpose of securing a better distribution in all the markets, we recommend a more thorough system of Government crop reports and statistics. 4. A national system of licensing and bonding warehousemen and commission merchants dealing in food products to, secure to the growers a guarantee of better service and price on all such products stored and consigned. 5. That the Federal Government shall by suitable legislation enable producers of perishable food products to finance the construction and operation of adequate cold-storage and warehousing facilities for the more orderly marketing of their products, which will result to the advantage of both producer and consumer. 6. That surveys should be conducted through Government agencies to determine production costs of perishable fruits and vegetables in the various production areas in order that the relation which present freight rates bear to production costs and to net returns for a given product in each locality may be determined, to the end that freight rates may be reduced in accordance therewith. REPORT OF SUBCOMMITTEE 51 ON COSTS, PRICES, AND READJUSTMENTS IN COST AND PRICE STUDIES. We urge fundamental importance of studies of costs and prices in connection with each important farm enterprise, be it crop or live stock, and of introducing these figures to individual farmers in the REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. 163 most efficient manner possible, in order to promote economic readjust- ment of farm production throughout the United States We feel that .when farmers, who in many cases fail to include everything in figur- ing costs, once realize that the costs of production of any particular crop are out of line with the probable returns which may be secured from that crop, they will limit their production of that crop, and, on the other hand, will increase their production of those crops in con- nection with which the opposite condition exists. In addition to readjusting farm production, cost data may be em- ployed for the purpose oi constructing tariff policies, adjusting freight rates, and of maintaining an equitable taxation policy rela- tive to farm land. We commend the cost of production studies now being conducted by the Federal, State, and farm organizations; we urge that these studies be continued, and that new studies be instituted in regions not now adequately covered by present investigations. We recommend that there be established uniform methods of collecting such cost data, and that provision be made for the assembling of all cost data now available for use as needed. ItEPORT OF SUBCOMMITTEE 5J ON COSTS, PRICES, AND READJUSTMENTS IN NEGRO FARM PROBLEMS. We, the committee on Negro farm problems, after careful con- sideration of the conditions that confront Negro farmers tbrpughout the United States, respectfully submit the following report : We first of all call your attention to the fact that there is a greater percentage of the Negro population who are farm operators than of any other racial group in this country, and that out of a total of 925,708 Negro farmers, 218,612 are owners. The Negro farmers operated, in 1920, a total of 41,432,182 acres. The value of the land and buildings owned, and in the care of these Negro farmers, amounts to $2,257,646,325, according to the census of 1920, which represents an increase of $1,334,927,622 during the last 10 years. . In view of the splendid progress shown above we feel that every effort should be made to encourage Negro farmers to buy and own their own farms, as ownership has generally proved to be a potent factor in the higher development of all classes of citizenship. Due to the fact that slightly more than 75 per cent of the Negro farmers are in the tenant class, we feel that an intensive and sym- pathetic study should be made of all conditions peculiar to this form of land tenure, to the end that we may be able to offer recom- mendations for the social and economic betterment of this class of our farming population. As therQ is great suffering throughout the country among Negro farmers on account of the lack of ready money, and as there are large quantities of farm products on hand for which they have not been able to find a market, we urge that special attention be given to the formation of cooperative marketing associations among this "•roup, and wherever possible these farmers be accorded the same advantage in existing organizations in their respective communi- ties as other subscribing members. There is a special need for a more favorable application of the Federal farm loan act in its relation to colored farmers so that they 164 EEPORT OP THE NATIONAL AGRICXjLrUEAL CONFERENCE. may be able to obtain all of the assistance that may be had through this helpful source ancl be relieved from the too frequent pressure of local money loaners. There is much dissatisfaction among the rural districts on ac- count of poor school facilities which, in many cases, have been the cause for a general migration from the farms to the cities. Be- cause of this we urge a more liberal support from the State and lo- cal governments. We need a more generous Federal and State support of our Negro agricultural colleges and a closer supervision of their activities, as they constitute the principal sources for intelligent agricultural leadership. There should be a more adequate distribution of Federal funds that are allocated to the different States under the Smith-Lever and the Smith-Hughes Acts so that Negro farmers may receive a greater benefit, to the end that we may have a larger number of well-trained men and women to advise and to work in the rural districts. This is especially necessary because of the fact that this class of our farming population has had less advantage than most of the other farming groups. Since the Negro farmer has made such splendid progress in farm ownership and has contributed so largely to the wealth of the Na- tion, it is essential, if he is to remain on the farms, that every effort should be made to protect him in the enjoyment of his life and property. REPORT OF COMMITTEE NO. 6, CROP AND MARKET STATISTICS. An industry so fundamentally important as agriculture to the welfare and prosperity of all the people, upon which more than one- third of the entire population is dependent for a living, which has a larger capital investment and gives employment to a greater number of people than any other industry, which makes up one-half of the export trade and represents one-third of the purchasing power of the United States, whose products are consumed in every home, which is directly in competition with other countries of surplus production, and which is dependent upon foreign countries of deficient production to furnish a market for its surplus products, is entitled to an adequate and efficient statistical service for its crop and live-stock production, market movement, stocks on hand, surpluses and deficits, farm and market priceSj and the various factors affecting supply and demand. Adequate statistics are essential for the guidance of American farmers and business men, for the formulation of constructive programs of farm production and marketing, and as a basis for wise legislation. The following recommendations are therefore submitted : (1) Acreag e.~ln order to obtain acreage figures of the greatest poss-ible accuracy the committee recommends that an agricultural census be taken at the end of every fifth year, in cooperation with the United States Department of Agriculture, and that an annual census of acreages planted to different crops be taken by each State in con- nection with the listing of its taxable farm property. (2) Condition and indicated yields during the growing season — It is recommended that the United States Department of Agriculture collect and publish data monthly or oftener during the o-rowina sea- REPORT OF THE NATIONAL AGEICTJLTtrEAL CONFERENCE. 165 son showing the condition of important crops, with interpretations showing the probable yield per acre and the probable effect of such condition and yields on the ultimate supply. (3) Production. — It is recommended that the United States De- partment of Agriculture report annually the production and value of each and all crops and annually, or at more frequent intervals, a census or survey be made of stocks of important farm products re- maining on farms from previous harvests. (4) Marketable surplus production. — It is recommended that, in addition to reports of total production, estimates be made of the marketable surplus for each important crop. ( 5 ) County estimates. — The committee recommends that the United States Department of Agriculture adopt the county as the geo- graphical unit for its estimates of crop and live-stock production. LIVE-STOCK STATISTICS, The committee on live-stock statistics reports that live stock is generally looked upon as the basis of a sound system of agricul- ture. It consumes the wastes of the farm and utilizes the waste places. It provides the agency, in the marvelous laboratory of nature, for turning fe'ed into food. Its waste products feed the soil. Live stock, more than any other agency, converted more than a million square miles of a once great waste into the present great West. The growing of live stock requires longer time, heavier financ- ing, broader knowledge, and closer application than most lines of agriculture, and the hazards are greater. The production' of live stock for meat requires a period ranging from two to eight times as long as that needed to produce a plant crop, and losses on the undertaking at the end of this long period of preparation, recently so frequent, are inevitable so long as there exists no agency properly equipped to keep live-stock producers informed of the state of the industry. The producer of live stock at present is venturing on uncharted seas. He can not obtain ade- quate and assured information as to whether numbers are increased or decreased, whether heavy marketings represent increasing num- bers or the sacrifice of the herds and the dissipation of the capital of the industry. The whole industry, and the producers especially, are compelled to undertake heavy and unnecessary risks from the lack of basic information such as is now collected and published regarding crops. Live-stock production and supply fluctuate in just the same man- ner as with crops; its movements to and through markets are as fluid ; the gluts and shortages are just as acute and the resulting price fluctuations even more acute, because the product is in the class of perishables. Because of these things, because this great industry represents a capital investment of from five to ten billion dollars, .and because it furnishes more than half of the cash income of farmers, this great branch of agriculture requires and is entitled to the same type of information concerning production, present and probable future sup- ply, market movement, and prices as is now furnished by the Fecl- eral and State Governments to the producers of staple crops. 166 EEPOKT OF THE NATIONAL AGRICULTURAL CONFEBENCE. (6) Number of animals on farms. — The committee recommends that the United States Department of Agriculture publish quar- terly or monthly balance S'heets on farm and -ranch supply of each class of meat animals, showing, on the basis of extensive inquiry of individual farms and ranches, the numbers on farms and ranches at the beginning of the period, the number born, the number brought onto the farm or ranch, the number moved off, the number slaugh- tered, the number died (other than those slaughtered) , and the num- ber remaining on farm, or ranch at the end of the period. (7) Number of animals on feed. — The committee recommends that the United States Department of Agriculture publish periodi- cal estimates, on the basis of extensive inquiries, showing the num- ber of head of meat animals to be marketed during the ensuing period (from one to three months), the approximate date to be mar- keted, and the approximate weight per head when ready for market. (8) Classification of animals. — The committee recommends that periodical estimates be made and published by the United States Department of Agriculture showing for meat, dairy, and work ani- mals the proportion and number of each class in the principal age groups, the proportion of each class of breeding stock, and the pro- portion of female animals expected to drop young during the ensu- ing period. (9) Dairy production. — The committee recommends that periodi- cal estimates be published by the United States Department of Agri- culture to show the number of cows kept for milk, the average yield IDcr cow, and the total production of milk, butter, and cheese. (10) Poultry production. — The committee recommends that monthly estimates be published by the United States Department of Agriculture showing the number of poultry and the production of eggs on farms. (11) Pure-bred live stock. — The committee recommends that an- nual estimates be published by the United States Department of Ag- riculture sho'v^ing the proportion of live stock of the different breeds, the percentage of each breed registered, the percentage graded, and the percentage of all other classes. (12) Wool. — The committee recommends that the United States Department of Agriculture, report the production and prices of wool in more complete detail and with greater frequency than at present. (13) Five-year census of live stock. — It is recommended that in order to improve the accuracy of live-stock estimates a census of live stock be taken every fifth year, instead of every tenth year, by the Bureau of the Census in cooperation with the United States Depart- ment of Agriculture. (14) Arvmial live-stock census. — It is recommended that as every State has recognized the importance of live stock by taxing it an- nually, each State should make operative a law requiring assessing officers to collect and forward to the State secretary of agriculture, or other appropriate agency, data showing the numbers ot all farm animals, including both those taxed and those exempt from taxation, and showing separately the important classes, such as milch cows. (15) Live-stock statisticians. — It is recommended that agricul- tural statisticians be employed by the United States Department of Agriculture, one to be attached to each State office of its Bureau of Markets and Crop Estimates, who will devote his time primarily EEPORT OF THE NATIONAL AGRICULTUEAL CONFERENCE. 167 to the study and investigation of live-stock conditions through travel, interviews, and correspondence, as is now done for field crops. (16) Checking and releasing live-stock reports. — It is recom- mended that all live-stock estimates be checked by all available data of an absolute nature, by independent sources of information, and by separate groups of correspondents reporting to the Washington office and to the live-stock statisticians in the field, and that the data be summarized and published under the same safeguards as are now provided for crop statistics, in order to insure that the information shall be made public to all concerned at the same moment. MARKET MOVEMENTS- AND STOCKS. The subcommittee on market movements and stocks reports that complete, accurate, unbiased, dependable, and time statistics on the production, storage, marketing, and movements of agricultural products are absolutely essential for the guidance of farmers and business men, for constructive program of production and marketing, and as a basis for wise legislation and economic adjustments. (17) It is recommended that statistics be collected and published periodically by the Department of Agriculture, daily, weekly, monthly, or annually, depending on the nature of the product, season, and region, showing current and prospective movements and stocks in storage at market centers and en route of the merchantable surplus of each important crop and class of live stock, and of the products derived therefrom, out of the county where grown or manufacturing center where processed and between cities, whether by rail, water, or highway ; also the same information with reference to exports and imports; the same, so far as practicable, to show points of origin and destinations. (18) It is recommended that statistics likewise be collected and published periodically showing the stocks of agricultural products on farms by States and areas of principal production. (19) It is recommended that all data on market movements and stocks of agricultural products should, so far as practicable, show the quantities by recognized classes and grades for each product, and the shrinkage, deterioration, and loss in transit and in storage. (20) It is recommended that in connection with the biennial cen- sus of manufacturers a census also be taken of the number of ware- houses, including elevators, and their storage capacities, and stocks of agricultural products by kinds, classes, and grades in public and private warehouses and commercial establishments upon forms pre- scribed by the United States Department of Agriculture, and that ''^e results be published of same as promptly as possible. The bien- nial census report also to show the quantity of production, annual sales, and stocks on hand of fertilizers, insecticides, fungicides, and farm machinery, implements, and equipment of different kinds. (21) It is recommended that statistics be collected showing the number of live stock slaughtered by kinds and classes so as to show the monthly and annual slaughter of grown males and females and young stock; that these data include all commercial slaughter, whether inspected or uninspected, and farm slaughter. (22) It is recommended that, based upon the comprehensive sta- tistics of market movements of live stock, a committee be established 168 EEPOEl? OV THE I^ATIONaL AGEICtTLTtTEAL CONFERENCE. at each of the important live-stock market centers for the purpose of aiding the stabilization of live-stock market movements and prices, said committee to comprise a representative of the Department of Agriculture, a representative of the buying interests, a representative of the live-stock commission men, and a representative of the live- stock producers and shippers, such committee to be initiated by the Department of Agriculture and to issue from market centers timely informatiaon and -warnings to live-stock producers and ship- pers as to unusual market movements, conditions, and deman,ds, so as to prevent, so far as possible, fluctuating receipts at markets and the consequent loss to producers. , FARM AND MARKET PRICES. (23) Farm and market prices. — It is recommended that statistics be collected and published periodically by the United States Depart- ment of Agriculture showing the prices received by producers for crop, live stock, and live-stock products ; the prices paid for different classes of farm lands and their total value; the prices farmers pay for hired labor, seed, fertilizers, machinery, equipment, and sup- plies; and the wholesale and retail prices of principal agricultural products by classes and grades at important market and consuming centers. (24) Census wholesale prices of farm machinery and supplies. — It is recommended that the annual average wholesale prices of ferti- lizers, insecticides, and fungicides, farm machinery, implements, and supplies be reported by the Bureau of the Census in connection with the biennial census of manufactures. (25) Price factors. — It is recommended that statistics concerning factors influencing prices and values of farm products be collected and published periodically. (26) Analysis, correlation, and interpretation. — It is recommended that statistics of production, market movement, stocks, and prices be analyzed and correlated with statistics of population, consumption, present and prospective supply and demand, and other factors in- fluencing production, consumption, and prices; that series of index numbers be established and maintained to show relationships and trends; and that the results of statistical studies be summarized in text, and interpreted and illustrated by means of maps, graphs, and diagrams so as to set forth essential and significant facts in striking and readily understandable form. (27) Foreign statistics. — Inasmuch as the prices of agricultural products in the United States are influenced by the relative world supply and demand, it is recommended that statistics of crop and live-stock production, consumption, imports and exports, supply and demand, surpluses and deficits, be made available by the United States Department of Agriculture as far as may be practicable for all countries. (28) International Institute of Agriculture at Rome. — In order to facilitate the prompt collection of more and better agricultural sta- tistics in foreign countries, it is recommended that Congress make the necessary appropriation to strengthen the International Institute of Agriculture at Rome and to enable the United States to be repre- sented by a competent permanent delegate at the institute, and by a REPORT OF THE NATIONAL AGRlCtTLTURAL CONFERENCE. 169 strong delegation at the biennial meetings of the general afssembly of the institute. (29) Agricultural attaches. — In order to supplement and further strengthen the International Institute of Agriculture at Kome and to obtain essential information relating to agriculture and trade in agricultural products in foreign countries, including prices and the transmission by cable of information as to material changes in crop and market conditions and situations, it is recommended that the United States Department of Agriculture employ trained agricul- tural attaches in principal countries of surplus production in compe- tition with the United States and in principal countries of deficient production which afford a market for the surplus farm products of the United States. (30) Gooferation. — It is strongly recommended that the various executive departments of the Federal Government and their repre- sentatives abroad shall cooperate fully and effectively to avoid un- necessary duplication of work and expense and to make the public service as efficient as possible. (31) Dissemination of crop and markei information. — It is recom- mended that the United States Department of Agriculture, in co- operation with other Federal, State, and local agencies, publish with the utmost promptness and as widely as practicable official crop, live- stock, market, and price data, both domestic and foreign, -through daily, weekly, annual, and special reports, through the daily and weekly press, and by telegraph and radio service. (32) The committee wishes to commend the voluntary crop re- porters of the United States Department of Agriculture for their public-spirited service in furnishing crop and live stock data in the past, and further suggests and urges that the value of the statistical service of the United States Department of Agriculture is dependent largely upon the cooperation of producers and others who supply full and prompt information in response to questionnaires addressed to them by the department. (33) Reviews of commodity conditions.— li is recommended that the United States Department of Agriculture publish frequent re- views of crop, live stock, and market conditions and situations, pre- pared by thoroughly competent men, in which shall be assembled in brief and simple but comprehensive form, illustrated by charts and diagrams intelligible to producers, all the factors bearmg upon the present or future supply, demand, and prices of each principal crop, class of live stock, or agricultural commodity. (34) Dates of statstical reports and forms of quest ionnairs.— This committee has noted that at times acts of Congress providing for the collection and dissemination of statistics prescnb^ specific dates for renumeration or issue of reports which while effective m some years are not satisfactory in other years, and further that at times the details of questionnaires are prescribed by law. it is the iudgment of this committee that all such matters as dates and the details of questionnaires are matters which could to advantage be left to administrative departments of the Governnient so that they may easily be adjusted to suit the needs as they arise. (35) Adequate salaries for statisticians.—^ & ^i^rthe'' note the extremely low salaries paid statisticians which call for constant changes resulting in lack of continuity and efficiency desired. We 170 EEPOET OV THE NATIONAL AGEICULTUKAL CONFERENCE. urgently request the more liberal payment of skilled statisticians in order to build up a more efficient and permanent staff required to furnish the data we need. (36) This committee further concurs in the recommendations of the Joint Commission of Agricultural Inquiry in its report on the agricultural crisis and its causes, favoring the enlargement and de- velopment of the statistical service of the United States Department of Agriculture, particularly along the lines of procurement of better live-stock statistics, and by the employment of agricultural attaches in foreign countries. (37) In order that the constructive work of this National Agricul- tural Conference may not go for naughty it is earnestly recommended that the various agricultural, commodity, and trade organizations interested and representatives of the press urge upon the public and upon Congress the necessity for making effective the recommenda- tions of this and other committees. REPORT OP COMMITTEE NO. 7, MARKETING OF FARM PRODUCTS. COOPERATIVE MARKETING. This committee strongly indorses and recommends the coopera- tive marketing of farm products. As a factor in marketing it elimi- nates unnecessary costs, undue speculation, and waste involved in the assembling, grading, handling, storing, distribution, and mar- keting of farm products, so that these products may be distributed at prices which are fair and reasonable both to the producers and the consumers. The recognized form of cooperative action in business which has resulted in the great industrial development in this country through the coordination, consolidation, and concentration of capital and management is not suited to the conditions prevailing in the agri- cultural industry. The economies and benefits both of a private and public nature arising from collective action should be made avail- able to those engaged in agriculture to the same extent as they are available to those engaged in other industries where corporate or- ganization on a large scale is feasible. Laws have been framed primarily with reference to such industrial organizations and are hot adapted to the requirements of organized producers of agricultural products desiring to avail themselves of the benefits arising from acting collectively in the handling, processing, and distribution of their products. i We further urge that Congress promptly enact affirmative legis- lation which will permit farmers to act together in associations, cor- porate or otherwise, with or without capital stock, for purposes con- nected with the production, processing, preparing for market, han- dling, and marketing in interstate commerce such products of persons so engaged with specific statements of their rights, powers, reme- dies, and limitations, and which will permit such associations to have marketing agencies in common and to make such contracts and agreements as are necessary to effect such purposes. EEPORT OF THE NATIONAL AGRICULTUEAL OONFEKENCE. 171 PRICE FIXING IN THE MARKETING SYSTEM. Prices to producers are determined by one of three methods of selling: (a) Individual bargaining, (h) selling by associations, (c) governmental guaranties or purchases. The farmer is entitled to look to governmental 'agencies for com- prehensive and accurate information, in order that selling judgments may be better formed, and for the largest measure of ready credit compatible with sound' finance methods, in order that there may be the utmost freedom of selection of time and price. The committee feels in respect to the naming of selling prices by the joint action of members through cooperative associations, that Congress should clarify present' Federal statutes by an affirmative declaration that such action by cooperative associations is not in- cluded in the prohibitions against restraint of trade. With respect to the question of • governmental price guaranties, we feel that there should be a comprehensive study of this subject; therefore we urge that the Congress cause a careful investigation of this whole problem to be made by some proper authority which will report its findings as early as practicable. PRICE ADJUSTMENT. Agriculture is necessary to the life of the Nation ; and, whereas, the prices of agricultural products are far below the cost of pro- duction, so far below that relatively they are the lowest in the history of our country; therefore, it is the sense of this committee that the Congress and'the President of the United States should take such steps as will immediately reestablish a fair exchange value for all farm products with that of all other commodities. ORDERLT MARKETING. Orderly marketing which represents the even distribution of the Nation's farm products in response to the demands of the trade and of the consumer is basic in giving the farmer a fair price for his crops or products. The individual farmer is riot competent to handle or even to influence this question. Neither the volume of his product nor his individual financial resources enable him to in- fluence the distribution of a commodity as a whole, and he is gen- erally unable to provide the facilities needed to finance, warehouse, or sell his seasonally produced crops at the right period of time. Only through cooperative farmers' agencies can these basic matters of distribution, financing, warehousing, and sale be effectively pro- vided. It is in the general interest of all classes of the people that farm products be marketed in a systematic, orderly manner, with adequate provision of all facilities involved. The fundamental' requirements for orderly marketing include the organization of producers on a commodity basis in order that large dependable quantities of standardized farm products may be offered for sale with speculation and all unfair and dishonest practices in distribution reduced to a minimum. This distribution and sale should be based on information of the domestic and foreign supply, and of its location, systematized, both seasonally and geographically. 172 REPOKT OF THE NATIONAL AGRICULTTJBAL CONFERENCE. It includes warehouse facilities provided especially for seasonally produced products with waste eliminated and credit requirements adequately provided, by making the collective collateral of ware- house goods a security for loans. It is fundamental to orderly marketing that the State and Federal Governments do those things which are impossible of achievement by an organization of farmers, that helps them to a better understand- ing of their problems, and we strongly urge in the interest of the whole public that all of the agencies of the Government which fur- nish crop or trade information that can be used as a guide to intelli- gent distribution be strengthened, and that the information be made readily available to the parties at interest, that the Government, through both legislation and administrative action, assure the pro- ducer, the trade, and the public alike, the principles of a " square deal " in all their business relationships. The committee is further of the opinion that the President of the United States in his address to the National Agricultural Conference has made a contribution of great value to the success of orderly mar- keting in suggesting that " with proper financial support for agri- culture, and with instrumentalities for the collection and dissemina- tion of useful information, a group of cooperative marketing organi- zations would be able to advise their members as to the probable demand for staples and to propose measures for proper limitations of acreage in particular crops." This committee, therefore, strongly urges the formation of strongly organized cooperative associations of farmers, preferably on a com- modity basis, as the most efficient agencies through which to handle the different matters relating to the handling, financing, distribu- tion, warehousing, and sale of farm crops. STATE AND FEKERAL SERVICE AND REOULATIONS. Marketing services. — Federal and State services in marketing fall into tAvo classes : First, those which can not be performed by private enterprise, such as statistical work in crop and live-stock estimating and market news services, including reports from foreign countries. They are essential to the general welfare. They should be complete and efficient. Second, those in which the State or Federal agency may displace or compete with a private agency because the latter does not generally satisfy public needs. In every such case the service rendered by the State or Nation must — 1. Excel in quality or surpass in scope that which has been privately developed, or 2. Must serve a larger part of the population, or 3. Must inspire greater public confidence, or ■ 4. Must tend to equalize opportunity, or 5. Otherwise improve economic relationships. • Therefore: 1. The general principle of incorporating a revenue- producing feature in every such service is sound. 2. Those services which can produce relatively small revenues should be supported by direct appropriation while those which can be largely self-supporting, such as the shipping-point inspection serv- ice, must be capable of rapid expansion and contraction and should use their fees as revolving funds. EEPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. 173 3. No limit should be set on the volume of business which may be done for those who desire service. Regulation. — Regulatory action affecting marketing agencies or processes should have for its objects either {a) the limitation of monopolistic tendencies, (&) the equalization of economic oppor- tunity, (c) the collection of facts o£ general economic concern, {d) the prevention of fraud or of practices deemed unfair or uneconomic, or {e) to compel action consistent with the results of economic re- search. Therefore : 1. Regulation should not be applied to one industry or group for the direct benefit of its competitors. 2. Regulation should not expose legitimate business secrets, but sound public policy demands that no person, class, organization, group, or interest may withhold from a State or Federal agency such repoits of its business as may be necessary to show, when compiled or averaged, the facts necessary for an intelligent public understanding of the progress of the marketing, processing, merchandising, or con- sumption of the product. 3. The rejection of shipments on declining markets is an- abuse detrimental to agriculture, and immediate regulatory action should be taken to provide an effective arbitration system. 4. State and Federal law should provide adequate regulatory supervision of all handlers of farm products. 5. To prevent fraud we favor the passage of legislation provid- ing for the standardization of hampers and other baskets used in the shipment and distribution of fruits and vegetables. 6. That the ultimate consumer may know what he buys, we favor regulatory action whenever necessary to compel manufacturers or dealers to show by brands, tags, grade names, or otherwise the true quality, composition, source, or grade of goods offered the public. 7. This committee recommends that in every State there should be a complete centralization of regulatory functions in the field of marketing. 8. The committee believes that the several States should provide under Civil Service rules for the retention in office during good be- havior of the technical and clerical staffs engaged upon service and regulatory work. The term "Bureau of Markets " is now after 10 years of continual effort a recognized symbol of service, education, and regulation throughout the country in the minds of producers, consumers, and market trade agencies. The Federal and State bureaus of markets have together secured a great degree of cooperation from the marketing trade. The trade knows and regards with confidence those agencies called Bureau of The proposed amalgamated bureau in the Department of Agri- culture will be seriously handicapped in its service to the public if its name does not include the term " markets." AVAREHOUSING AND WAREHOUSING FACILITIES. United States warehouse act.— In order to encourage the proper storage and orderly marketing of agricultural products and to strengthen and encourage the credit facilities therefor, there should 174 EEPORT OF THE NATIONAL AGRICULTUBAL CONFERENCE. be an adefc[uate warehousing system, which will provide safe and suitable warehouses, competent and reliable warehousemen, and widely acceptable warehouse receipts. The strengthening and ex- tension of the existing Federal warehouse act and the passage by the various States of laws which should result in uniformly regulat- ing the performance of the obligations of wajrehousemen, such laws to be so drafted as not to conflict with or duplicate, but to supple- ment, the Federal law in all necessary respects, should result in an adequate warehousing system. Appropriate amendments to the act are earnestly recommended by this conference in order to facilitate financing of stored crops and the better protection of such crops. This conference further urges that adequate appropriations be made for the administration of this act in order that its benefits may be generally available. Temporary storage in producing districts. — There is a need on the part of individual producers and producers' organizations of agri- cultural products, concentrators in producing districts, and others accumulating agricultural products for wholesale distribution for better ■ facilities for the temporary holding of farm products in the producing districts until delivery or shipment is made. Such facilities would tend to prevent waste, maintain quality, equalize the flow of goods, and generally improve marketing. In the case of perishables, protection should be afforded against freezing in winter by buildings adequately insulated. and artificially heated if necessary. Summer protection should be afforded by build- ings' adequately insulated and refrigeration, preferably mechanical. Wholesale terminal facilities.— The larger receiving centers require terminal wholesale facilities to handle adequately and economically agricultural products coincident with and in the interim between their unloading from the railroad cars and their delivery to regular trade channels. (a) Such terminal wholesale facilities should, if possible, be adja- • cent to union railroad terminals and waterway terminals. (&) Layout and construction should permit of the handling of agri- cultural products with, a minimum of expense and effort compatible with adequate protection. (c) In the case of perishables, protection against freezing by buildings adequately insulated and artificially heated if necessary in winter, and summer protection should be afforded. It is especially important that such protection should be so afforded as to be con- tinuous with the protection given by the refrigerated or heated car. {d) The wholesale terminal facilities are, in general, required for temporary, not period, storage, and should be constructed and oper- ated accordingly. (e) They may be owned and operated by any adequate organiza- tion, but present needs and future development would probably be best served by a logical tying in with agencies and facilities already established and recognized as desirable and necessary. Federal cold-storage legislation. — The cold-storage warehouse sys- tem which has developed in the United States is essential to agri- culture to assist in conserving perishable foods and in extending the period of their distribution. It serves both the producer and the consumer. REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. 175 In the rapid growth of the cold-storage industry some injurious practices subversive of the proper functioning of the industry as an aid to seasonal distribution have developed. While these abuses have not been general they have worked, where they have existed, to the disadvantage of the whole public. About 21 States have enacted laws regulating cold storage, many of them based upon the "Uniform law relating to the cold storage of certain articles of food," recommended by the commissioners of uniform State laws appointed by the governors of the several States. These State laws vary in many irnportant particulars, and in some States are not properly enforced. State officials responsible for their enforcement affirm that proper enforcement is made difficult, and in some cases impossible, by reason of the fact that a large percentage of cold-storage products move in interstate commerce without evi- dence that such products have been in cold storage. For the benefit of the industry itself and of the public there should be enacted as promptly as possible a Federal cold storage act on lines recommended by the industry itself, the specialists of National and State Governments, and in keeping with the best interests of both the producer and the consumer. Warehouse loans. — Practical means should be taken to make stored products more generally available as a basis for loans. However, such loans should not be for the purpose of uneconomically affecting the flow of goods to market, but should have for their purpose the orderly marketing of the farmers' products and not the promotion of speculation. Investigation of effect of storage on agricultural products. — In view of the necessity for the maintenance of value of agricultural products which, because of seasonal production, must be subjected to period or temporary storage, there should be made exact scientific investigations into the storage conditions most desirable for the pres- ervation of such products and of the effect of storage on condition and quality, whether storage be common or under temperature, ven- tilation, or humidity artificially maintained. Furthermore, such investigations should be conducted in the United States Department of Agriculture, since the character and scope of the undertakings preclude either maintenance or supervision on the part of the producers or of the warehouseman. STANDABD GRADES AS A FACTOR IN MARKETING. Market grades and standards are basic factors in promoting effi- ciency in the distribution of agricultural products in that they en- courage the production of a better quality of product, make possible more definite sales contracts, and promote the realization of a fair price to the producer, the trade, and the consumer. Relative commercial values are determined by the grade and uni- formity of products offered and not by grade names ; but favorable market prices are maintained and stabilized through trade confidence in established standards. Standards therefore should be established on a basis that will con- tribute to and encourage better production and secure for the pro- ducer the highest net returns; and further in the establishment of such standards, due regard should be given to trade and manufac- 92640— H. Doc. 195, 67-2 12 1 76 REPORT OF THE NATIONAL AGRICULTURAL CONrERENCE. turing conditions which must be observed in order to insure general commercial usage and to establish trade confidence. Standards further contribute to efficiency and improved marketing and should include standardization of products and containers under conditions that will permit grading, weighing, of packing at or near point of origin with adequate facilities for inspection and appeal. Such standards on farm products should be established by the Fed- eral Government after conference with the producers, members of the trade, and other interested parties. MARKETING COST STUDIES AND IMPROVED BUSINESS METHODS. 1. Data on marketing costs are considered essential as a basis for a constructive long-time marketing program, and especially are studies on the cost of marketing the principal staple agricultural products needed. Such studies will lead to a better understanding of the marketing system as a whole, as well as serve as a ba^is for com- paring the relative efficiency of the various agencies engaged in the distribution of agricultural commodities. - Cost of marketing data will serve also to point out to individual marketing. units their efficient and inefficient practices. It is believed that such studies should be greatly extended. 2. Improved and more economical methods of marketing agricul- tural products can be developed through the medium of cooperative marketing associations established by the producers themselves. 3. A greater amount of cooperation and a higher degree of coordi- nation of the various agencies which handle, manufacture, conserve, and distribute agricultural products is desirable, and should be en- couraged by the State and Federal Governments with due regard to the interest of all the people. EEPORT OR COMMITTEE NO. 8, AGRICULTURAL RESEARCH AND EDUCATION. The greatest disaster which can befall a people is the retardation of the development and diffusion of knowledge. America leads in all phases of national life because it has always led in efforts to dis- cover and disseminate knowledge among all the people. This ap- plies with special force to all matters concerning agriculture. The Morrill Act, the Hatch Act, the Adams Act, the Smith-Lever Act, and the Smith-Hughes Act are perhaps the most notable of the long series of Federal statutes testifying to the intention of the Ameri- can people to maintain their agriculture upon a plane at least equal to,^ and if possible superior to, that in any other country. The new agricultural problems which' have come as a result of postwar conditions require early solution. The individual farmer IS demanding information. As never before, he is now entering the business world through his cooperative organizations. Existing institutions for agricultural research, education, and ex- tension should be developed and strengthened. There should cer- tainly be no reduction in financial support. Their facilities should be directed to the solution of the practical and economic problems of agriculture in all their relations and in aiding all farmers to apply available knowledge to the solution of their problems, indi- vidually and collectively. REPORT OF THE NATIONAL AGRICULTURAL, CONFERENCE. 177 The results of research should be published adequately and promptly for the information of the public and the encouragement of investigators and teachers. Farmers should cultivate a more intimate relationship with their county agent, State experiment station and agricultural college, and United States Department of Agriculture, so that they may secure and utilize to advantage available information. Existing provisions for reducing damage and losses from injuri- ous insects, animal and plant diseases, and other pests should bo maintained and developed. The development of agriculture upon an equality with other in- dustries requires, first of all, equality of educational opportunity for those who dwell in the country as compared with those who live in the cities and villages. Gross inequality now exists, and it must be removed. REPORT OP COMMITTEE NO. 9, A PERMANENT FOREST POLICY. Half of all the wood consumed in the United States is used on the farm. The scarcity of lumber, with consequent high prices, ha? already seriously injured our farming people. The coming timber scarcity will atfect them most dangerously, because they can not farm without wood and because the use of substitutes will help them less than any other class. High prices for lumber used on the farm directly affect the cost of food production and raise the cost of food and clothing to the whole people of the United States. The first and most important step toward insuring a timber sup- ply for the people of the United States is the immediate stopping of further devastation on lands that bear forests now. The devas- tation is caused by the common practice, except in public forests, of cutting mature timber without provision for future growth, fol- lowed by fires which sweep across the .slashings and destroy what young trees remain. No safe provision for a permanent timber sup- ply to support a permanent agriculture and permanent industries is possible until this devastation is stopped. It can be stopped only by public regulation of the methods of cutting and by protection from fire. This makes imperative some form of Federal legislation. As measures immediately necessary, in view of the present situa- tion, the committee on a national forest policy recommends the fol- lowing: Privately owned commercial lands, containing three-fourths of the saw timber we have left, are being with a few honorable exceptions devastated more rapidly and completely than ever before to the in- calculable injury of the whole Nation. This devastation must be stopped by effective legislation. The scarcity of timber has already resulted in excessive prices of lumber to the farmers and consumers generally. The continuance of forest devastation will, by restricting the supply of lumber, interfere to a dangerous degree with farm development, the prosperity of agri- culture, and the supply of food for our people. Therefore action to prevent further devastation of the remaining mature forests is im- mediately necessary, and should be taken at once. Two-thirds of our States, containing three- fourths of our people, are already dependent for timber upon the few remaining wood-ex- 178 EEPOET OF THE NATIONAL AGEICXJLTUKAL CONTERENCB. porting States, soon to be reduced to two or three. Therefore the forest problem is nation-wide and the Nation itself must safeguard the interests of its people by insuring a permanent cheap and ample supply of timber for their use. Our forest lands contain mainly very young or very old trees. Therefore the harvesting of mature timber should be so conducted as to leave uninjured the middle and smaller sizpd trees, upon which this Nation must depend to bridge over, so far as practicable, the coming shortage of lumber. Forest fires following after destructive lumbering have created a man-made desert about as large as the forests of all Europe except Eussia and Scandinavia. Effective methods of fire prevention are well known. Therefore liberal provision should be made for com- plete fire protection upon public and private forest lands through co- operation between the National Government, the States, and the pri- vate owner. There in no public market information service for forest products as there is for other farm products. Therefore such a service, cover- ing the production, sales, shipments, and prices of forest products both in the United States and in foreign countries, should be collected and disseminated to farmers and other consumers and producers by the Government at public expense. Continuous and profitable forest production requires compara- tively large areas of forest land. Therefore cooperative forest pro- duction offers special advantages as applied to scattered woodlots on farms. It should be specifically authorized by legislation wherever such legislation does not already exist. The same reasons which recommend the cooperative purchase and sale by farmers of other products and supplies apply equally to products of the forest. Therefore such cooperative purchase and sale should everywhere be authorized by law and widely practiced among farmers. ' Extension work in the production and harvesting of forest prod- ucts is as necessary to the farmer as similar work dealing with other products. It has hitherto been neglected. Provision to extend such help in better methods of handling farm woodlots should be pro- vided under the same conditions. Research in forestry has already produced results of incalculable value to the people of the United States and is essential for future progress. Therefore research in methods of maintaining and increas- ing the productivity of forest lands, in methods of utilizing forest products, should be promoted in every practicable way. Since the shortage of construction timber throughout the world will make it impossible to meet the coming scarcity of lumber, since we must grow what we need or go without, and since the present area of forest land in the United States is barely sufficient, under the best protection and management, to meet the present needs of our people, therefore the total forest acreage of the United States must not be reduced, but, on the contrary, must be increased wher- ever practicable by the inclusion of land not more valuable for other purposes. Throughout the world publicly owned forests are better man- aged, better protected, and more productive than those in private hands. Therefore the present area of public forests, National, State, REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. 179 or municipal, should not only be kept rigorously intact but increased as rapidly and extensively as possible by purchase, gift, or exchange, and by additions from other public lands. Our country is so large that the separation of sources of forest supplies from centers of consumption results in expensive transpor- tation charges upon the consumer. Therefore the production of wood upon land not more valuable for other purposes should be en- couraged in every State and region throughout the Nation. The ax and fires have reduced to unproductive barrens vast areas of forest lands good only to grow trees. These areas should be re- stored to production by fire protection and planting. Therefore as- sistance to private owners by furnishing planting material at cost or free should be given by the State and Federal Governments in cases where the taking over of the land and complete reforestation at public expense are not practical. To grow a tree takes a lifetime or longer, and a forest crop can be harvested only at interval far apart, therefore taxation upon for- est land should be so adjusted as to assist, rather than hinder, the practice of forestry by private owners without relieving forest prop- erty from its proper share of the common burden. REPORT OF COMMITTEE NO. 10, NATIONAL LAND POLICY. The era of free, accessible land of good quality is past. There remains much valuable land requiring heavy expenditure to make it available. However, there is much land being turned to unfor- tunate and uneconomic uses. Eecognizing the wisdom of the recommendation of President Harding that the Government should give encouragement " to every practical proposal for watering our arid land, for reclaiming cut- over forest areas, for protecting fertile valleys from inundations, and for draining the potentially rich and widely extended swamp areas;" and recognizing that such reclamation should be carried on , only in the light of the fullest knowledge as to the uses to which the land is best adapted ; and that the time, the rate, the order, and the manner in which land should be reclaimed is related to our whole economic life, and recognizing, further, the need of a national policy regarding land tenure, we believe that a deliberate and unified plan of national land utilization is imperative. Such a plan would in- volve not only public reclamation and the use of publicly owned land but also proper direction to the processes of settlement by private agencies. It would include, furthermore, measures designed to remedy such evils as are involved in the land tenure of the Nation. In order that such a policy may be effectively developed, we be- lieve it essential that a national land commission be established. Such commission should include representatives of the governmen- tal agencies concerned with administering the agricultural interests of the Nation. A commission of this character should fulfill the following func- tions: ■ (a) Proceed to classify the areas of land not in farms with a view to determining the most economical use, such as forests, grazing, and crops, grading each class according to its economic quality. (i) Determine a policy of reclaniation which shall be coordinated with the need for agricultural land and with other economic condi- 180 EBPOET OF THE NATIONAL AGRICULTUEAL CONFERENCE. tions. A policy of this kind must provide for the welfare of settlers and the prosperity of the Nation as a whole. A land-development policy should be nation-wide. An adequate plan of selecting set- tlers, as well as land, must be included. (c) Develop a comprehensive policy relative to grazing on public land to the end of more economical use, taking into account the proper relation of grazing and homestead rights. (d) Provide intelligent direction, in cooperation with the States, to agencies of private land settlement and to intending settlers. (e) Recognizing the fundamental of home ownership as a means of developing a strong citizenship, the commission should undertake to promote a satisfactory relation between landowner and tenant and to facilitate the purchase of farms by capable farmers. (/) Said national commission should cooperate with a similar body in each State so that the land policy of each and every State may be adapted to the conditions therein, and that no public ex- penditure be encouraged in the creation of more farms until the present acute conditions in agriculture at home and abroad shall have been fully adjusted. KEPOET OF COMMITTEE NO. 11, FARM POPULATION AND FARM HOME. I. FARM POPITLATION, 1. While we recognize the basic importance of financial prosperity, the committee desires to express the conviction that more than finan- cial prosperity will be essential in the realization of the " new con- ception of the farmer's place in the national and social economic scheme." 2. It is apparent to the committee that it is necessary for Federal and State agencies to continue, or, where lacking, inaugurate the study of such phases of our rural population as are related to a permanent rural life. 3. The safeguarding of the health of the people in the open country is a first consideration. Any program that looks toward the proper safeguarding of the health must include adequate available facili- ties for the people in the open country in the way of hospitals, clinics, laboratories, dispensaries, nurseSj physicians, and health officers. This committee indorses the growing tendency through public agen- cies to maintain the health of the people by means of these facilities and agencies. 4. The committee recommends that the State and Federal agencies give attention to problems of providing adequate free circulating libraries for the country people, and also recommends that secondary school facilities be increased so that country families may have con- venient and adequate training for their young people. It is also recommended that our rural educational curriculum be so organized as to be adapted to rural needs and that adequate provision be made for the study of problems of rural life. 5. The committee recommends to the State boards of education and other similar agencies the importance of introducing suitable instruction in the principles of cooperation as applied to community, social, and business life. REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. 181 6. To correspond with the volume now issued for larger centers of urban population, the committee recommends that the United States Census Bureau prepare and publish a similar volume on farm population. 7. We deplore the tendency of the press to depict occasional and extreme conditions of toil or hardship on the part of farm women as representing usual or normal conditions. II. THE FARM HOME. 1. Agricultural and economic conditions largely determine the standards of living in the farm home. Economic reforms along the lines of cooperative marketing and finance are readily translated into better homes. While working along economic lines every effort should be made to maintain good standards of home life and stress those ideals of high type homes that shall give to rural life the satis- faction, attractiveness, dignity, and power to which it is justly en- titled. 2. Recognizing that the farm home is the heart not only of Amer- ican agriculture but of the Nation as well, we strongly urge that its power and influence be fully appreciated and used, through the ap- pointment of farm women as weU as farm men to official positions in farm organizations, and through the selection of farm women for service on important National and State boards. This equal repre- sentation of country and city homes will add to the dignity of country life and serve to bring about a better understanding between country, town, and city. 3. We realize that now the morale of the farm families must be kept up as was that of the soldiers in the dark days of the war and that the first and most important means in accomplishing this is self-help. This should be supplemented by the enthusiasm which comes from united effort in community groups and .organizations, and the aid of the church, the school, the extension service, and all other forces effectively cooperating in an earnest endeavor to do worth while things as they come to hand, working toward ultimate relief through every means recommended by this conference. 4. In view of the growing demand for educational assistance from the extension service of the State agricultural college, because of an increase in the groups of farm families associated together for mutual help, no matter under what names, a greater number of public extension workers is needed especially in the interests of the farm home. We subscribe cordially to the principle that all extension workers should be employed only with public funds and should serve with equal zeal all groups or organizations of people without dis- tinction. Extension work should be a public educational service for rural people. 5. Recognizing the splendid organized work that has been con- ducted by farm men and women in many communities, we strongly recommend that agricultural organizations emphasize in their definite programs a study of food, clothing, housing, child care, and higher life as related to the high-standard home, which is our goal. 6. In view of the fact that farm tenancy is seriously increasing and thereby endangering the stability of the farm- home in some sections of the country we wish to encourage farm ownership. 182 REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. 7. We desire to commend Congress and the President for the passage of the maternity act. 8. We indorse the honie economics amendment to the Federal voca- tional educational act. 9. Assured that the future of agriculture depends upon the train- ing of farm boys and girls for farm home and community life, we recommend such training as a vital factor in development of leader- ship, community spirit, cooperative study, and the use of new and improved methods in agriculture and social life in the country. We urge that farm men and women take an active part in the organiza- tion and maintenance of some type of group work for boys and girls, that by this method the joys and dignity of agriculture as a profes- sion can be developed as in no other way. 10. We strongly recommend the conservation of the American farm home. It offers the best opportunity for the development of ideal family life, in which the farmer and his wife are equal partners in work, social life, and business, and in which the children have an opportunity to become junior partners in the managment of the farm and home. REPORT OF COMMITTEE NO. 12, COORDINATION OF STATE AND FEDERAL LEGISLATION. 1. When States have laws regulating agriculture that cover more completely the field included in existing or proposed Federal regu- latory laws, all points of possible conflict or overlapping of authority should be considered and settled, as the circumstances may require, by Congress or by negotiations between the Federal administrative authorities and the State officials responsible for State regulations. Federal and State exercise of authority should be harmonious, for conflict may defeat real regulation. 2. To the end that agricultural products and commodities may move in interstate traffic without unnecessary restriction, it is recom- mended that there be coordination of State and Federal laws, giving due consideration to local conditions, as to inspection, grading, weighing, packing, warehousing, and financing, and that cooperation in administration among the various States and between the States and the National Government be promoted to the fullest extent, recognizing in the coordination of State and Federal legfelation the police powers vested in the States. 3. For the protection of public health, it is recommended that the States pass uniform laws regulating and safeguarding dairy products and by-products, and that uniform laws providing for inspection of meat animals and meat and meat products entering intrastate commerce amounting to nearly 40 per cent of the entire amount con- sumed, should be enacted on the general lines of the Federal meat inspection laws or service. 4. Believing that the cooperation of the Federal and State Gov- ernments in tuberculosis-eradication work under the officially ac- credited herd plan will be of lasting benefit to the live-stock industry of the country and of untold value in the protection of the public health, we urge that the States pass laws providing for area work in counties and muncipalities in cooperation with and under the supervision of the State regulatory officials to make possible the most REPORT OF THE NATIONAL, AGRICULTURAL CONFERENCE. 183 effective cooperation with the successful national plan for eradica- tion of bovine tuberculosis. We recommend, however, that area work be not made compulsory by Federal legislation, but be left op- tional with the States for the present. 5. It is recommended that State laws for the control of plant diseases and pests be drawn on broad lines delegating the necessary authority, sufficient in emergencies, to control outbreaks such as gipsy mothj pink boUworm, citrus canker, corn borer, pine blister rust, etc., and, in their inspection of nursery stocks and plant, that such broad authority be placed in the hands of State entomologists and State plant pest commissions as would also enable them to coordinate their services with the Federal Horticultural Board. 6. The manufacture, sale, and use as food of compounds consist- ing of milk from which the butter fat has been taken and oriental vegetable oils substituted therefor is a growing menace to the public health and threatens to undermine the dairy industry of the United States. Investigations have shown that the pure food and drugs act d(5es not give the public the necessary protection against these compounds, and that additional Federal and State legislation is desirable. We therefore urge the enactment of a Federal law to prohibit the introduction into interstate commerce of compounds of vegetable oils and skimmed milk or products made in the semblance of milk. We further urge the passage by the various States of ad- ditional legislation prohibiting the manufacture or sale of such imi- tation compounds, and close cooperation between Federal and State enforcement authorities in the detection and prosecution of violators of such laws. 7. Permissive legislation for agricultural cooperation has been passed in some form in a number of States ; some States have enacted laws based upon the European type of capital stock cooperative; others have passed acts permitting farmers to form membership non- stock, nonprofit corporations. A few States have permitted both types of cooperatives to operate. It is recommended that the separate States, wherever this may be .needed, pass or revise their permissive legislation to harmonize with the proposed legislation to authorize cooperation, already indorsed by this conference, by the enactment of uniform cooperative laws. 8. There should be adequate legislation providing for truthful, affirmative labeling or description in connection with the sale of agricultural products, in raw and manufactured forms, similar in principle to the commonly designated "Truth in fabric" bill now pending in Congress. ,,-,.,-,, 9. We are opposed to the appropriation of public funds for what is known as Government free-seed distribution, and respectfully urge upon Congress that after this present year this practice be discon- tinued. , ■ ■ 1111 10. Complete and accurate crop and market information should be obtained and published promptly from time to time for all agricul- tural products, whether in raw or manufactured form, including both domestic and foreign production, consumption, visible supply, stocks in storage, stocks in manufacturers' hands, etc., and with this in view each State should have a department or agency to cooperate with the Federal Agricultural Department in such work. The gathering and dissemination to the public of false and misleading crop and market 184 EEPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. information by private agencies should be prohibited and punished under both Federal and State legislation. 11. In view of the fact that many farm organizations represented •in this conference are on record against proposed legislation remov- ing from the Federal Agricultural Department various bureaus or divisions, and placing them under the jurisdiction of other depart- ments, and that many States now have laws and departments con- stituted by law cooperating and coordinating with the Federal De- partment of Agriculture, the removal from the Federal Agricultural Department of its functions embraced within the Bureaus of For- estry, Roads, States Relations, Weather, Soil, or Markets and Crop Estimates will lead to endless confusion and added expense ; therefore it is recommended that such separation be not made. 12. The President and the Secretary of Agriculture should take steps to bring about the establishment of a National Agricultural Advisory Council which should be a continuing body fairly represent- ing all interests in agriculture and which should meet, from time to time, for the consideration and development of a permanent prfigram of agriculture, including the coordination of State and Federal activities in relation thereto. Whereas farming Is the most important basic industry of the Nation ; and Whereas one-third of the population Is engaged in agriculture, and Whereas It has not been customary to appoint farmers to national commis- sions : Therefore be it Resolved, That it is the belief of this conference that the judgment of farmers is needed on such commissions and that a more general appointment of farmers to such commissions is In the interest of public welfare. GENERAL RESOLUTIONS OFFERED FROM THE FLOOR AND PASSED. ON MUSCLE SHOALS. Resolved, To accomplish results without any further delay whatsoever, we urge the Secretary of War to recommend and the Congress to accept Henry Ford's proposal to take over the hydroelectric power and air-nitrate plant at Muscle Shoals, under a guaranty to operate same for 100 years at its present capacity of approximately 100,000 tons of ammonium nitrate per annum, opening the Tennessee River to navigation, cheapening the production of fer-. tilizer, metals, and other commodities, and assuring the United States nitrogen Independence in peace or war. TO THE PEESIDENT. Whereas this conference has been the occasion of gathering together of the most representative group of delegates of agriculture and allied industries that has occurred In recent years ; and ■ Whereas the survey of the conditions and need of the farm Industry has been most thorough and comprehensive, providing a means of expressing tli'? thought of farmers and those with related Interests in outlining the basis for a present and future policy for agricultural advancement : Therefore be it Resolved, That we express and convey to the President of the United States our sincere commendation of his recognition of agriculture In Initiating the call for this conference. TO THE SECRETARY OF AGRICULTURE. Whereas the Secretary of Agriculture has shown the most genuine interest and understanding in the needs of agriculture and has demonstrated un- mistakable fairness to all groups and sections by his selection of delegates: Therefore be It Resolved, That we extend to the Secretary our most hearty thanks and appreciation of the manner In which he has carried out the charge placed upon him by the President of the United States ; and be It further BRPOKT OF THE NATIONAL AGEIGULTUEAL CONFEKENCE. 185 Resolved, That we likewise express our appreciation of the unselfish co- operation afforded the conference by the members of the staff of the Depart- ment of Agriculture. TO CHAIRMAN SYDNEY ANDEKSON. Moved that the appreciation of the conference be extended to the permanent chairman, Representative Sydney Anderson, for the fairness, ability, and effl- ciency with which he presided over its deliberations. TO THE NEW WILLARD HOTEL. Whereas the management of the New Willard Hotel extended their hospi- tality to the conference by providing a general meeting place, headquarters, press and committee rooms without obligation : Therefore be it Resolved, That this conference extend to the management of the New Willard Hotel its most sincere thanks for the facilities afforded. (Adopted unanimously.) GENERAL SURVEY OF RECOMMENDATIONS OF NATIONAL AGRICULTURAL CONFERENCE. RECOMMENDATIONS FOR CONGRESSIONAL ACTION. Investigate plans for stabilization of dollar — Committee 1. Provide short-time agricultural credit — Committee 2. Continue War Finance Corporation if necessary — Committee 2. Amend Federal reserve act providing agricultural representative — Committee 2. Investigate crop insurance — Committee 2. Prohibit tax-free securities except farm loan bonds — Committee 2. Repeal of section 15a of interstate commerce act — Committee 3. Restore powers State railway commissions — Committee 3. Provide tor completion of Muscle Shoals project — Committee 3. Provide for development of St. Lawrence-Great Lakes water- way — Committee 3. Retain tolls on Panama Canal — Committee 3. Urge continued Federal aid for highways — Committee 3. Adequate support of International Institute of Agriculture at Rome — Committee 4. Amend the Webb-Pomerene Act on export trade — Committee 4. Recommends tariff adjustment board and tariff legislation per- mitting adjustment of rates within limitations — Committee 4. Provide for agricultural attaches abroad — Committee 4. Enactment cooperative legislation — Committee 7. Legislation on price statements by cooperative associations — Com- mittee 7. Federal cold-storage legislation — Committee 7. Credit for warehouse certificatfes — Committee 7. Legislation to prevent destruction of forests, fire protection on private and public lands, increase of forest acreage — Committee 9. Establish national land commission to classify land, providing for protection of settlers, intelligent development as present acute con- ditions are adjusted — Committee 10. , Commends health conservation for rural people — Committee 11. Provision for circulating libraries; instruction in cooperation in schools; expansion of extension work among farm homes — Com- mittee 11. Cooperation in administration between Stace and Federal Govern- ment of regulatory laws — Committee 12. 186 REPORT OF THE NATIONAL AGEICULTTTRAIj CONFERENCE. Eecommends discontinuance of free seed distribution— Com- mittee 12. RECOMMENDATIONS TO TAKMEES. Continue to reduce overhead expense by efficiency in crop pro- duction — Committee 3. Urge diversification — Committee 5. -, ^ -i.^ k Adjust farm operations to market demands— Committee 5. KECOMMENDATIONS TO PRESIDENT. Establish a national agricultural council— Committee 12. READJUSTMENTS. No national prosperity until both wages and capital bear just share in readjustment — Committee 5. Congress and the President take steps to immediately reestablish a fair exchange value for all farm products with that of all other commodities — Committee 7. Expansion of support in work of research education and extension facilities — Committee 8. EXPANSION OF AGRICULTURAL DEPARTMENT. Agricultural census every five years — Committee 6. Expansion of crop -reporting service to include live stock and greater details on crops, etc. — Committee 6. More statistics on market, stocks, and movement — Committee 6. Studies on cost of marketing — Committee 7. LIST OP DELEGATES TO THE NATIONAL AGBICTTLTTJBAL CONFERENCE. Abbott, J. S., Washington, D. C, Institute of Margarin Manu- facturers. Adams, Samuel, Chicago, 111., editor of American Fruit Grower. Agee, Alva, Trenton, iC J., commissioner of agriculture. Allen, C. H., Marion, Ohio, representative of sugar farmers. Amorous, M. F., Marietta, Ga., cotton grower. Anderson, J. M., St. Paul, Minn., president of Equity Exchange. Anderson, Hon. Sydney, Washington, D. C, House of Kepresen- tatives. Ardis, J. B., Shreveport, La., banker and rice grower. Armour, J. Ogden, Chicago, 111., packer. Atkeson, T. C, Washington D. C, National Grange. Austin, W. L., Washington,, D. C, chief agricultural statistician, Bureau of the Census. Babcock, C. M., St. Paul, Minn., president of American Associa- tion of State Highway Officials. Bailey, E. M., Pittsburgh, Pa., president of International Milk Dealers' Association. Baker, Herbert F., Weadock, Mich., Michigan Potato Growers' Exchange. Barnes, Julius H., New York, N. Y., former chairman of United States Grain Corporation. Barrett, Charles S., Union City, Ga., president of National Farm- ers' Union. REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. 187 Bartholomew, J. B., Peoria, 111., president of Avery Co. Baruch, B. M., New York, N. Y., banker, former chairman of War Industries Board. ^Bayard, E. S., Pittsburgh, Pa.,, editor of National Stockman and Farmer. Bean, L. S., Presque Isle, Me„ potato grower. Bell, James F., Minneapolis, Minn., miller. Bingham, Eobert W., Louisville, Ky., Burley Tobacco Growers' Association. Bixby, Fred H., Long Beach, Calif., president of American Na- tional Live Stock Association. Black, B. John, Eoslyn, Md., Maryland State Grange. Black, Mrs. B. John, Koslyn, Md., home economics committee. National Grange. Black, Mrs. Frank B., Myersdale, Pa., Society of Farm Women of Pennsylvania. Black, William, Louisville, Ky., president of National Association of Farm Equipment Manufacturers. Blakeman, Mrs. Nellie E., Oronoque, Conn., chairman of home economics committee, National Grange. Bowles, Geo. H., Lynchburg, Va., president of Farmers' Union. Bradfute, O. E., Xenia, Ohio, president of State Farm Bureau. Brand, Charles J., Pittsburgh, Pa., vice president of American Fruit Growers (Inc.). Brigham, E. S., St. Albans, Vt., commissioner of agriculture. Brookings, W. Du Bois, Washington, D. C, United States Chamber 01 Commerce, manager of national resource department. Brown, Everett C, Chicago, 111., president of National Live Stock Exchange. Brown, John G., Indianapolis, Ind., president of Indiana Farm Bureau ; executive committee, American Farm Bureau Federation. Burguieres, C. P., New Orleans, La., American Cane Growers' Association. Burlingame, W. M., Great Falls, Mont., Equity Society. Butler, Henry F., Wiscasset, Me., farmer and fruit grower. Campbell, Milo D., Coldwater, Mich., president of National Milk Producers' Federation. Campbell, Vernon, San Jose, Calif., California Cooperative Can- ners. Cance, A. E., Amherst, Mass., economist, Massachusetts Agricul- ture College. Capper, Hon. Arthur, United States Senate. Carey, Gov. R. D., Careyhurst, Wyo., cattleman. Carter, Spencer, Eichmond, Va., National Fertilizer Association. Chaffee, Mrs. H. F., Amenia, N. Dak., farm owner. Chaney, B. E., Stuttgart, Ark., farmer, president of Rice Growers' Cooperative Association. Chapin, Eoy D., Detroit, Mich., National Automobile Chamber of Commerce. Chappell, Mrs. L. C, Lykesland, S. C, home demonstration work. Chase, J. E., Jacksonville, Fla., fruit and vegetable dealer. Christie, G. I., Lafayette, Ind., director of Indiana Experiment Station ; former Assistant Secretary of Agriculture. 188 EEPORT OF THE NATIONAL AGBICULTUEAL, CONFEBENCE. Clark, A. L., Trenton, N. J., president of National Association of State Marketing Officials. Cobb, C. A., Atlanta, Ga., editor of Southern Ruralist. Coker, D. R., Hartsville, S. C, cotton planter. Collins, Chas. E., Kit Carson, Colo., cattleman. Collins, J. M. Eaton, Colo., Farmers' Union. Cook, A. B., Owosso, Mich., master of State Grange. Cooper, Thomas F., Lexington, Ky., dean of College of Agricul- ture. Cornwall, E. B„ Middlebury, Vt., president of St-^te farm bureau. Costigan, Mrs. Edward P., tVashington, D. C, Consumers' League. Coulter, John Lee, Agricultural College, N. Dak., president North Dakota College of Agriculture. Cowan, Sam, Fort Worth, Tex., lawyer, attorney for live-stock association. Cunningham, John F., Cleveland, Ohio, editor of the Ohio Farmer. Curtis, A. J. R., Chicago, 111., Society of Agricultural Engineers. Davis, A. C, Gravette, Ark., secretary of National Farmers' Union. Davis, A. P., Washington, D. C, Director of Reclamation Service. Davis, Vernon T., Jackson, Miss., farmer. Davison, G. Howard, Millbrook, N. Y., live-stock farmer. Dillon, John J., New York City, editor of Rural New Yorker. Dinsmore, Wayne, Chicago, 111., secretary of Horse Association of America. Dodson, W. R., Baton Rouge, La., dean of College of Agriculture. Doerr, A. A., Larned, Kans., National Federation of Implement and Hardware Dealers. Doherty, Manning W., Toronto, Canada, minister of agriculture. Drummond, W. I., Kansas City, Mo., secretary of International Farm Congress. Duggar,. J. F., Auburn, Ala., consulting agriculturist, Agricul- tural Experiment Station. Dunlap, Henry M., Savoy, 111., president of National Apple Growers' Association. Edens, William G., Chicago, 111., banker. Ely, Richard T., Madison, Wis., economist, University of Wis- consin. Everett, Walter, Lyons, Nebr., farmer. Farmer, Walter B., Hampton Falls, N. H., general farmer. Faville, E. E., Portland, Oreg., editor of Western Farmer. Fields, John, Oklahoma City, Okla., editor of Oklahoma Farmer. Filley, H. C, Lincoln, Nebr., economist, University of Nebraska. Firestone, H. S., Akron, Ohio, National Highway and Highway- Transport Educational Commission. Fox, J. W., Scott, Miss., cotton planter. French, R. S.J Washington, D. C, National League of Commis- sion Merchants. Friday, David, East Lansing, Mich., Michigan Agricultural Col- lege. Frizell, E. E., Larned, Kans., State board of agriculture. Fulk, George W.. Bethany, 111., general farmer. Fuller, Luther D., Jamestown, N. Y., agricultural agent, Erie Railroad. REPORT OF THE NATIONAL AGRICULTXJKAL CONFERENCE.' 189 Funk, Eugene, Bloomington, 111., farmer. Funk, Hon. F. H., Washington, D. C, House of Representatives. Georgeson, Hans, Niagara, N. Dak., president of Farm Bureau Federation. Gilbert, Dr. A. W., Boston, Mass., commissioner «f agriculture. Glover, A. J., Fort Atkinson, Wis., editor of Hoard's Dairyman. Goddard, L. H., Washington Court House, Ohio, general farmer. Gompers, Samuel, Washington, D. C, president of American Federation of Labor. Gormley, M. J., Washington, D. C, American Railway Associa- tion, car service division. Graves, Col. Henry S., Washington, D. C, former United States forester. Gray, Chester, Nevada, Mo., president of State Farm Bureau. Gregory, C. V., Chicago, 111., editor of Prairie Farmer. Gunn, R. M., Buckingham, Iowa, farmer. Gustafson, C. H., Chicago, 111., president of United States Grain Growers (Inc.). Hagan, John N., Deering, N. Dak., ex-commissioner of agriculture. Hagenbarth, Frank, Salt Lake City, Utah, president of National Wool Growers' Association. Halladay, H. H-j Lansing, Mich., commissioner of agriculture. Hancock, Arthur B., Paris, Ky., tobacco grower. Hare, Marvin B., Newport, Ark., farmer. Harper, Dr. J. N., Atlanta, Ga., director of soil improvement committee. Plarris, B., Columbia, S. C, commissioner of agriculture. Harry, D. G., Pylesville, Md., dairyman, and presidMit of Farm Bureau. Haugen, Hon. G. N., Washington, D. C, House of Representatives. Heard, Dwight B., Phoenix, Ariz., president of Arizona Pima Cotton Growers. Hecke, G. H., Sacramento, Calif., commissioner of agriculture. Heiskell, Fred, Little Rock, Ark., editor of Arkansas Gazette. Hill, Chas. L., Rosendale, Wis., dairy farmer. Hill, H. M., Lafontaine, Kans., Farm Bureau, Farmers' Union. Hill, W. S., Mitchell, S. Dak., president of Farm Bureau. Hillard, T. R., Wilkes-Barre, Pa., American Corn Millers' Federa- tion. Hills, Jos. L., Burlington, Vt., Univei-sity of Vermont. Hirsh, Joseph, Corpus Christi, Tex., agricultural commission, American Bankers' Association. Hodge, H. J., Abilene, Kans., National Federation of Implement Dealers' Association. Holman, Charles W., Washington, D. C, National Milk Producers' P'ederation. Home, Frank A., Freeport, Long Island, N. Y., cold storage. Houston, S. P., Malta Bend, Mo., farmer. Houx, Edward, Kansas City, Mo., president of Kansas City Live Stock Exchange. Howard, J. R., Chicago, 111., president of American Farm Bureau Federation. Hubert, Benjamin F., Tuskegee, Ala., Tuskegee Institute. Hull, N. P., Dimondale, Mich., president of National Dairy Union. 190 KJEPOKT OF THE NATIONAL AGRICULTURAL CONFERENCE. Hunt, Charles W., Des Moines, Iowa, president of Iowa Farm Bureau. ^ ,.p • /-i n •> Hunt, Thomas F., Berkeley, Calif., dean of California College of Agriculture. ^ . _, .^ _, , Hunter, W. B., Cornelia, Ga., president of Georgia Fruit Exchange. Huston, Guy, Chicago, 111., president of Joint Stock Land Bank A cjQopi Q Lion / James, W. K., St. Joseph; Mo., president of International Farm Congress. Jamison, W. G., La Veta, Colo., farmer. » . , , -r- Jardine, James T., Corvallis, Oreg., director of Agricultural ihx- periment Station. ^ » • i Jardine, W. M., Manhattan, Kans., president of Kansas Agricul- tural College. Jeffers, H. W., Plainsboro, N. J., dairy farmer. Jenkins, A. H., Philadelphia, Pa., editor of Farm Journal. Johnson, Albert A., Farmingdale, Long Island, N. Y., director of New York State Institute of Applied Agriculture. Jones, Houston, Pharr, Tex., farmer. Jones, Mrs. J. W., OLney, Md., farm women's work. Kahn, Alfred G., Little Rock, Ark., Interstate Cottonseed Crushers Association. Kaplan, A., Crowley, La., rice grower. Kent, I. H., Fallon, Nev., general merchant. Ketchum, Mrs. J. C, Washington, D. C, women's committee. Farm Bureau. King, Clyde L., Philadelphia, Pa., University of Pennsylvania. King, C. C, Banner, Okla., Oklahoma State Grange. Kilgore, B. W., Ealeigh, N. C, director of Experiment Station. Klein, J. M., New York City, president of National Poultry, Butter and Egg Association. Knapp, Bradford, Fayetteville, Ark., dean of Agricultural College. Knowles, Miss Neale S., Ames, Iowa, home economics department, Iowa State College. Laird, A. W., Potlatch, Idaho, president of Western Forestry and Conservation Association. Lansdon, W. C, Salina, Kans., Farmers' Union. Lee, Oliver M., Alamogordo, N. Mex., farmer. Leith, M., Ware, Iowa, American Home Builder Association. Lenroot, Hon. I. L., Washington, D. C, United States Senate. Leonard, Howard, Eureka, 111., president of Illinois Agricultural Association; executive committee, American Farm Bureau Federa- tion. Lever, A. F., Washington, D. C, Federal Farm Loan Board. Lewis, C. I., Salem, Oreg., assistant general manager of Oregon Cooperative Fruit Growers' Association. Livingston, George, Washington, D. C, former Chief of Bureau of Markets. Loomis, A. M., Washington, D. C., National Dairy Union. Lowe, Russell B., Boston, Mass., president of National Association of Cotton Manufacturers. Lowell, S. J., Fredonia, N. Y., master of National Grange. Lute, H. D., Polk, Nebr., Farm Bureau. REPORT or THE NATIONAL AGRICULTURAL CONFERBNGE. 191 Lyman, Charles A., Washington, D. C, secretary of National Board of Farm Organizations. Lyon, W. H., Sioux Falls, S. Dak., attorney. McCray, Gov. Warren T., Kentland, Ind., stockman and farmer. McCroskey, Thomas, Knoxville, Tenn. McDougal, Robert, Chicago, 111., president of Chicago Board of Trade. MacDowell, C. H., Chicago, 111., president of National Fertilizers Association. McKay, G. L., Chicago, 111., secretary of American Association of Creamery Butter Manufacturers. McKenzie, H. C, Walton, N. Y., Farm Bureau. McKerrow, George, Pewaukee, Wis., president of State Farm Bu- reau. McSparran, John, Furniss, Pa., master of State Grange. Mann, A. E.., Ithaca, N. Y., dean of Cornell College of Agriculture. Manning, Albert, Otisville, N. Y., master of New "^rk State Grange. Manning, Mrs. Albert, Otisville, N. Y., home economics committee, National Grange. , Markham, C. H., Chicago, 111., president of Illinois Central Rail- way. Marsh, A. R., New York, N. Y., New York Cotton Exchange. Martin, George, New York, N. Y., editor of Farm and Fireside. Martin, O. L., Plainfield, Vt., master of State Grange. Martin, Mrs. W. C, Dallas, Tex., State chairman of Rural Life Clubs. Mather, W. A., Adams, N. Y., dairy farm. Mather, Mrs. W. A., Adams, N. Y. Mennel, M. N., Todelo Ohio, miller. Mercer, Joseph H., Topeka, Kans., commissioner of agriculture. Meredith, Edwin T., Des Moines, Iowa, former Secretary of Agri- culture. Merriam, C. B., Topeka, Kans., farm mortgage banker. Meyer, Eugene, jr., Washington, D. C, managing director of War Finance Corporation Miller, A. C, Washington, D. C, member of Federal Reserve Board. Miller, E. Percy, Chicago, 111., potato merchant. Miller, John D., Utica, N. Y., vice president of Dairymen's League. Miller, Louis F., Toledo, Ohio, president of Vegetable Growers' Association of America. Miller, Prager, Roswell, N. Mex., cattleman. Mitchell, Wesley C, New York, N. Y., economist. Moon, J. Edward, Morrisville, Pa., National Nurseryman's Asso- ciation. I, -KT ■ 1 o • Moore, Fred H., Rochester, Ind., president of National owme Breeders' Association. Moore, James, Rochester, N. Y., National Canners' Association. Moore, L. I., Newbern, N. C, farmer. Moorhead Frank G., Des Moines, Iowa, editor of Iowa Homestead. Morgan, A. A., KnoxviUe, Tenn., president of University of Tph- nessee. 92640— H. Doc. 195, 67-2 13 192 RBPOBT OF THE NATIONAL AGBICULrURATi CONFEEENCE. Morse, W. J., Orono, Me., director of Maine Agricultural Experi- ment Station. Morton, James W., Athens, Ga., president of State Farm Bureau; executive committee, American Farm Bureau ^Federation. Mumford, F. B., Columbia, Mo„ dean of College of Agriculture. Myrick, Herbert, Springfield, Mass., editor of Farm and Home. Needham, Barton, Lane, Kans., master of State Grange. Newell, Wilmon, Gainesvilla, Fla., dean, director, Florida Agri- cultural College. Nichols, Charles J., Boston, Mass., Wool Manufacturers' Associa- ■ tion. Nickerson, H. B., Elk River, Minn., president Minnesota Coopera- tive Creameries Association. Norgord, C. P., Madison, Wis., commissioner of agriculture. Nourse, E. G., Ames, Iowa, economist, Iowa Agricultural College. Ober, Gustave, jr., Baltimore, Md., fertilizer manufacturer. Olds, L. L., Madison, Wis., president of American Seed Trade Asso- ciation. O'Neal, Ed. A., Florence, Ala., farmer. Orr, J. Ty Dallas, Tex., president of Texas Fajm Bureau. Osbom, C. J., Omaha, Nebr., president of Farmers' Union. Ousley, Clarence, Fort Worth, Tex., former assistant secretary of agriculture. Owen, H. N., Minneapolis, Minn., managing editor of Farm, Stock and Home. Page, E. B., Leeds, N. Dak., wheat grower. Park, Mrs. Maud Wood, Washington, D. C, National League of Women Voters. Parker, Gov. J. M., Baton Rouge, La., cotton prodiicers. Pattison, Will H., Clovis, N. IVKx., farmer. Pearson, R. A., Ames, Iowa, chairman of executive committee of Association of Land Grant Colleges. Peck, T. F., Nashville, Tenn., commissioner of agriculture. Peek, George N., Moline, 111., farm machinery manufacturer. Peet, A. Brainerd, Milford, Del., secretary of Delaware Board of Agriculture. Pennington, M. E.j New York, N. Y., cold-storage expert. Pennock, S. S., Philadelphia, Pa., Society of American Florists and Ornamental Horticulturists. Phillips, R. G., Rochester, N. Y., distributor-secretary of Inter- national Apple Shippers' Association. Pickett, John E., Philadelphia, Pa., editor of Country Gentleman. Pinchot, Gifford, Harrisburg, Pa., State forester of Pennsylvania. Pinney, W. S., Suffield, Conn., tobacco grower. Poe, Clarence, Raleigh, N. C, editor of Progressive Farmer. PoUman, William, Baker City, Oreg., cattleman. Pommerening, E. C, Madison, Wis., American Society of Equity. Porter, J. F., Williamsport, Tenn., president of Tennessee Farm Bureau. Potter, L. E., Springfield, Minn., farmer. Powell, G. Harold, Los Angeles, Calif., general manager of Cali- fornia Fruit Growers' Exchange. Powell,^Thos. C, New York, N. Y., vice president of Erie Railroad. Pratt, Joseph H., Chapel Hill, N. C, director of economic survey. Price, Homer C, Newark, Ohio, fruit grower. BEPOfiT OF THE WATIOWAL AGRICXJLTUEAli OONFEEENCE. 193 Price, Theodore H., New York, N. Y., economist, editor of Com- merce and Finance. Putnam, G. M., Concord, N. H., president of Farm Bureau. Rasmussen, Fred, Harrisburg Pa., secretary of agriculture. Rawl, B. H„ San Francisco, Calif., California Central Creameries. EaymoncL C. W., Watseka, 111,, farmer. Reed, J. F., St. Paul, Minn., president of Farm Bureau. Reed, Walter R., Amenia, N. Dak., North Dakota Farm Bureau Federation. Reid, F. A., Phoenix, Ariz., Salt River Valley Water Users' Asso- ciation. Reno, Milo, Des Moines, Iowa, president of Farmers' Union. Riggs, W. M., Columbia, S. C, president of Clemson Agricultural College. Ritner, R. W., Pendleton, Oreg., Farm Bureau. Roberts, George A Omaha, Nebr., banker. Robins, Kingman M., Rochester, N. Y., banker. Robinson, Bird M., Washington, D. C, American Short Line Rail- road Association. Ross, J. H., Winter Haven, Fla., president of Florida Citrus Ex- change. Roth, Filibert, Ann Arbor, Mich., University of Michigan. Rule, Arthur R., New York, N. Y., North American Fruit Ex- change. Russell, H. L., Madison, Wis., dean of College of Agriculture. Sands, G. L., Charleston, Ark., president of Farmers' Union. Sapiro, Aaron, San Francisco, Calif., attorney for cooperative asso- ciations. Sconce, Harvey J., Sidell, 111., general farmer. Sewell, Mrs. Charles W., Otterbein, Ind., Indiana Federation of Farmers. Shearer, W. S^ Lewiston, Idaho, president of Farm Bureau. Shepherd, R. E., Jerome, Idaho, irrigation works. Silver, Gray, Martinsburg, W. Va., Farm Bureau. Simpson, J. A., Stillwater, Okla., president of Farmers' Union. Sisson, George W., jr., Potsdam, N. Y., Pulp Manufacturers' As- sociation. Slocum, Grant H., Mount Clemens, Mich., president of Gleaners' Federation. Slocum, G. W., Utica, N. Y., president of Dairymen's League. Smith, Leslie R., Boston, Mass., executive committee. National Grange ; deputy commissioner of agriculture. Smith, O. G., Kearney, Nebr., president of Farmers' National Congress. Snyder, Ralph, Manhattan, Kans., president of Farm Bureau. Spence, C. E., Oregon City, Oreg., master of State Grange. Sproat, Hugh, Boise, Idaho, Idaho Wool Growers' Association. Stackhouse, W. H., Springfield, Ohio, National Implement and Vehicle Association. Stone, A. H., Dunleith, Miss., cotton planter. Stone, R. W. H., Greensboro, N. C, president of Farmers' Union. Story, W. J., Courtland, Va., Peanut Growers' Exchange. Strasfeaugh, H. P., Aberdeen, Md., president of National Canners' Association. 194 BEPORT OF THE NATIONAL, AGRICULTUBAL CONFEBENOB. Stuart, H. C, ex-governor, Elk Garden, Va., president of State Farm Bureau. Stuhr, Leo,' Lincoln, Nebr., secretary of agriculture. Sumners, Hon. H. W., Washington, D. C., House of Eepresenta- tives. Sutton, Edward, Buffalo, N. Y., ice-cream manufacturer. Sweitzer, E. M., Shippensville, Pa., president of Farmers' Society of Equity. Swift, Charles H., Chic£^o, 111., meat packer. Sykes, A., Ida Grove, Iowa, president of Corn Belt Meat Pro- ducers' Association. Taber, L. J., Columbus, Ohio, commissioner of agriculture. Taylor, C. A„ Spencer, Ind.v Farm Life. Ten Eyck, Hon. Peter G., Washington, D. C, House of Eepre^ sentatives. Temiant, Hale, Lansing, Mich., farmer. Terrell, George B., Austin, Tex., commissioner of agriculture. Thayer, Harry, Boston, Mass., Tanners' Council, United States of America. Thomas, George, Salt Lake City, Utah, president of University of Utah. Thomson, E. H., Springfield, Mass., president of Farm Loan Bank. Thompson, W. J., South China, Me., master of State Grange. Thorne, Clifford, Chicago, 111., attorney. Tinkham, H. W., Warren, E. I., general farmer. Todd, F. E., Moline, 111., farm implement manufacturer. Topping, C. v., Kansas City, Mo.j, South West Millers' League. Tucker, T. C, San Francisco, Calif., California Almond Growers'^ Exchange. Turney, W. W., El Paso, Tex., lawyer and cattleman. Tyson, Mrs. Eussell, Chicago, 111., Woman's National Farm and Garden Association. Updike, Nelson, Omaha, Nebr., grain dealer. Van Norman, H. E., Washington, D. C, president of World's Dairy Congress Association. Vdgt, Paul L., Philadelphia, Pa., rural sociologist. Vrooman, Carl, Bloomington, 111., former Assistant Secretary of Agriculture. Wagner, W. L., Chicago, 111., fruit and vegetable dealer. Walker, Hayes, Kansas City, Mo., editor of American Hereford Journal. Walker, W. H., Willows, Calif., president of Farm Bureau. Wallace, Dan, St. Paul, Minn., editor of the Farmer. Wallace, Henry A„ Des Moines, Iowa, editor of Wallace's Farmer. Wannamaker, J. S., St. Matthews, S. C, president of American Cotton Association. Warren, G. F., Ithaca, N. Y., economist. Waters, Henry J., Kansas City, Mo. editor of Kansas City Star. Webb, N. F., Cortland, N. Y., president of Grange League Federa- tion Exchange. Wells, Frederick B., Minneapolis, Minn., grain dealer. Westberry, E. W., Sumter, S. C, National Negro Farmers' Asso- ciation. REPORT OF THE NATIONAL AGRICULTTJRAI, CONFERENCE. 195 Wheeler, Tom, Huntingdon, Ind^ editor of Indiana Farmers' Guide. Whitehurst, John, Oklahoma City, Okla., commissioner of agri- culture, farmer. Whitfield, J. A., Washington, D. C, Independent Meat Packers. Whittlesey, J. M., Hartford, Conn., State commissioner of do- mestic animals. Wicks, Charles W., Utica, N. Y., farmer and legislator. Williams, Carl, Oklahoma City, Okla., president of American Cot- ton Growers' Exchange. Williams, Mrs. Carl, Oklahoma City, Okla., women's editor of Oklahoma Farmer-Stockman. Willits, E. P., Ward, Pa., dairyman. Wilson, James W., Brookings, S. Dak., director of Agricultural Experiment Station. Wilson Lawrence G., Casa Grange, Ariz., farmer. Wilson, Thomas E., Chicago, 111., president of American Institute of Meat Packers. Winberg, O. F. E., Silver Hill, Ala., president of Gulf Coast Citrus Exchange. Windsor, Horace G., Boonvillcj Mo., general farmer. Winter, Mrs. Thomas G., Washington, D. C, General Federation of Women's Clubs. Woodruff, George. Joliet, 111., American Bankers' Association. Woods, A. F., College Park, Md., president of University of Mainland. Woods, Mark A., Lincoln, Nebr., banker. Wortham, L. J., Fort Worth, Tex., editor of Fort Worth Star-Tele- gram. PERSONNEL OF COMMITTEES. Committee No. 1, Ageicultube and Price Relations. Chairman, E. B. Cornwall, Vermont ; secretary, F. A. Pearson, J. B. Bartholomew, Illinois. David Friday, Michigan. L. J. Taber, Ohio. Nelson Updike, Nebraska, Henry A. Wallace, Iowa. B. E. Chaney, Arkansas. Samuel Gompers, District of Columbia. C. W. Raymond, Illinois. N. F. Webb, New York. J. F. Reed, Minnesota. H. J. Hodge, Kansas. Committee No. 2, Ageicul-ukal Credit, Insurance, and Taxation. Chairman, S. P. Houston, Missouri; secretary, V. N. Valgrdn. Asbury F. Lever, District of Columbia. Spencer Carter, Virginia. W.'fi. Farmer, New Hampshire. Joseph Hirsch, Texas. Guy Huston, Illinois. Chas. A. Lyman, District of Columbia. H. C. McKenzie, New York. C. B. Merriam, Kansas. Eugene Meyer, jr., District of Columbia, Theodore H. Price, New York. Kingman M. Robins, New York. E. H. Thomson, Massachusetts. George Woodruff, Illinois. H. M. Hill, Kansas. Lawrence G. Wilson, Arizona. B. John Black, Alaryland. Will H. Pattison, New Mf^xico. Clarence Ousley, Texas. A. C. Miller, District of Columbia. Mark A. Woods, Nebraska. Walter Everett, Nebraska. 196 KEPOET OF THE NATIONAL AGRICULTURAL CONFERKNCB. Committee No. 3,' Transpoetation. Chairman, H. J. Waters, Missouri ; secretary, T. H. McDonald. A. RAILWAY TBANSPORTATION. Chairman, Howard Leonard, Illinois ; secretary, J. H. Parmelee, Clifford Thorne, Illinois. R. G. Phillips, New York. A. H. Jenkins, Pennsylvania. C. H. MacDowell, Illinois. F. R. Todd, Illinois. Luther t>. Fuller, New York. W. L. Wagner, Illinois. R. M. Gunn, Iowa. Martin F. Amorous, Georgia. W. M. BurUngame, Montana, Wm. Pollman, Oregon. Sam W. Cowan, Texas. C. J. Osborn, Nebraska. T. C. Powell, New York. I. H. Kent, Nevada. M. J. Gormley, District of Columbia. E. A. O'Neal, Alabama. B. W^ATER TRANSPORTATION, Chairman, J. R. Howard, Iowa ; secretary. Max Lorenz. L. E. Potter, Minnesota. Bird M. Robinson, District of Columbia. Peter G. Ten Eyck, Washington. E. E. Prizell, Kansas. E. C. Pommerening, Wisconsin. J. C. Chase, Florida. Fred Heiskell, Arkansas. Milo D. Campbell, Michigan. C. HIGHWAY TRANSPORTATION. Chairman, W. H. Walker, California ; secretary, W. C. Markham. C. M. Babcock, Minnesota. Wayne Dinsmore, Illinois. Dwight B. Heard, Arizona. O. G. Smith, Nebraska. W. G. Edens, Illinois. R. D. Chapin, Michigan. H. S. Firestone, Ohio. Gray Silver, West Virginia. Mrs. Frank B. Black, Pennsylvania. Committee No. 4, Foreign Competition and Demand. Chairman, Harvey J. Sconce, Illinois; secretary, W. J. Callander. John G. Brown, Indiana. W. K. James, Missouri. G. F. Warren, New York. Frederick B. Wells, Minnesota. C. A. Cobb, Georgia. Hans Georgeson, North Dakota. William Black, Kentucky. G. Howard Davison, New York, Henry C. Stuart, Virginia. Thos. E. Wilson, Illinois. Harry Thayer, Massachusetts. R. E. Shepherd, Idaho. C. C. King, Oklahoma. Committee No. 5, Costs, Prices, and Readjustments. Chairman, H. L. Russell, Wisconsin; secretary, E.G. Nourse. A. TN THE COTTON BELT. Chairman, D. R. Coker, South Carolina; secretary, C. S. Scofield. Russell B. Lowe, Massachusetts. J. T. Orr, Texas. A. H. Stone, Mississippi. J. S. Wannamaker, South Carolina. B. IN THE WHEAT REGIONS. Chairman, W. M. Jardine, Kansas; secretary, C. R. Ball. 0. V. Topping, Missouri. Barton Needham, Kansas. B. B. Page, North Dakota. _ — _ . T. R, Hlllard, Pennsylvania. R. W. Bitner, Oregon C. IN THE CORN BELT. Chairman, Warren T. McCray, Indiana ; secretary, C. W. Warburton. F. H. Funk, Illinois. Fred H. Moore, Indiana. Hayes Wftlker, Missouri. C. W. Hunt, Iowa. Tom Wheeler, Indiana. EEPORT OF THE NAa?IONAL AGEICTJLTURAIi CONFERENCE. 197 D. IN THE DAIRY KEGIONB. Chairman, G. W. Slocum, New York; secretary, C. W. Larson. B. M. Bailey, Pennsylvania. A. J. Glover, AVisconsin. D. G. Harry, Maryland. Charles L. Hill, Wisconsin. O. L. Martin, Vermont. B. H. Rawl, California. H. E. Van Norman, California. A. M. Loomis, District of Columbia. T. F. Peck, Tennessee. K. IN THE EAN6E COtJNTET. Chairman, Prager Miller, New Mexico ; secretary, E. C. Chilcott. Fred Bixby, California. C. E. Collins, Colorado. Gov. R. D. Carey, Wyoming. J. T. Jardine, Oregon. Chas. H. Swift, Illinois. John A. Whitehurst, Oklahoma. J. S. Abbott, District of Columbia. r. IN THE TOBACCO DISTRICTS. Chairman, Judge Robt. W. Bingham, Kentucky ; secretary, F. B. Wilkinson G. H. Bowles, Virginia. B. W. Kllgore, North Carolina. William PInney, Connecticut. Leslie R. Smith, Massachusetts. G. IN StTGAE PBODUCTION. Chairman, W. R. Dodson, Louisiana ; secretary, C. O. Townsend. J. M. Collins, Colorado. A. B. Cook, Michigan. C. P. Burguieres, Loliisiana. C. H. Allen, Ohio. H. IN FEUIT AND VEGETABLE PKODtTCTlON. Chairman, Henry M. Dunlap, Illinois ; secretary, L. C. Corbett. Herbert F. Baker, Michigan. John J. Dillon, New York. J. Edward Moon, Pennsylvania. O. F. E. Winberg, Alabama. I. COSTS AND PRICE STUDIES. Chairman, H. W. Jeffers, New Jersey ; secretary, G. W. Forster. John F. Cunningh?im, Ohio. Ij. H. Goddard, Ohio. Louis P. Miller, Ohio. Ralph Snyder, Kansas. J. NEGRO EABM PROBLEMS. Chairman, Benjamin F. Hubert, Alabama; secretary, C. F. Hall. R. W. Westberry, South Carolina. Committee No. 6, Crop and Market Statistics. Chairman, C. S. Barrett, Georgia; secretary, L. M. Bstabrook. A. CROP statistics. Chairman, L. S. Bean, Maine; secretary, O. B. Gage. James Moore, New York. J. W. Fox, Mississippi. Frank G. Moorhead, Iowa. Henry F. Butler, Maine. B. LIVE-STOCK STATISTICS. Chairman, N. P. Hull, Michigan ; secretary, S. A. Jones. Frank J. HagenbartJi, Utah. Joseph H. Mercer, Kansas. C. MARKET MOVEMENTS AND STOCKS. Chairman, Homer C. Price, Ohio ; secretary, C. V. Whalln. Everett C. Brown, Illinois. Thomas Cooper, Kentucky. Robert McDougal, Illinois. 198 REPORT OF THE NATIONAX, AGRICULTURAL CONFERENCE. D. FABM AND MAEKET PBICE STATISTICS. Chairman, Eugene Funk, Illinois : secretary, Nat C. Murray. .John Lee Coulter, North Dakota. James W. Wilson, South Dakota. L. I. Moore, North Carolina. Charles W. Wicks, New York. M. Leith, Iowa. COMMITTEK No. 7, MABKETING OF FAEM PRODUCTS. Chairman, G. Harold Powell, California; secretary, Asher Hobson. A. STANDARD GRADES AS A FACTOR IN MARKETING. Chairman, E. Percy Miller, Illinois; secretary, George Livingston. James F. Bell, Minnesota. Chester Gray, Missouri. J. M. Klein, New York. ■ G. L. McKay, Illinois. A. R. Marsh, New York. A. L. Clark, New Jersey. Charles J. Nichols, Massachusetts. B. ORDERLY MARKETING. Chairman, Carl Williams, Oklahoma ; secretary, W. A. Wheeler. R. S. French, District of Columbia. C. I. Lewis, Oregon. ] John D. Miller, New York. G. L. Sands, Arkansas. H. W. Tlnkham, Rhode Island. George A. Roberts. Nebraska. A. Sykes, Iowa. A. A. Doerr, Kansas. C. WAREHOUSING AND WHOLESALING FACILITIES. Chairman, Charles J. Brand, Pennsylvania ; secretary H. S. Yohe. J. M. Anderson, Minnesota. Frank A. Home, Long Island. Arthur B. Hancock, Kentucky. Miss Mary E. Pennington, New York. H. W. Sumners, Texas. A. Kaplan, Louisiana. Vernon T. Davis, Mississippi. D. COOPERATION AS A FACTOR IN MARKETING. Chairman, O. H. Gustaf son, Illinois ; secretary, L. S. Tenny. H. B. Nickerson. Minnesota. George N. Peek, Illinois. J. H. Ross, Florida. Hale Tennant Mich. H. C. Filley, Nebraska. T. C. Tucker, California. Bradford Knapp, Arkansas. Aaron Sapiro, California. E. E. Paville, Washington. W. C. Lansdon, Kansas. W. S. Slie'arer, Idaho. E. STATE AND FEDERAL SERI'ICE AND REGULATION. Chairman, C. P. Norgord, Wisconsin ; Secretary, Wells A. Sherman. Edward' Houx, Missouri. Arthur R. Rule. New York. W. J. Story, Virginia. G. H. Hecke, California. George B. Terrell, Texas. Leo Stuhr, Nebraska. F. PRICE FIXING IN THE MARKETING SYSTEM. Chairman, Alva A^ee, New Jersey ; secretary, Alexander E. Cance. W. H. Lyon, South Dakota. Julius H. Barnes, New York. W. I. Drummond, Missouri. E. T. Meredith, Iowa. Houston Jones, Texas- J A. Simpson, Oklahoma. G. MARKET COST STUDIES AND IMPROVED BUSINESS METHODS. Chairman, Vernon Campbell, District of Columbia ; secretary H. E. Erdmsin. J. A. Whitfleld, District of Columbia. H. P. Strasbaugh, Maryland. Edward Sutton. New York. J. B. Ardis, Louisiana. Mrs. Russell' Tyson, Illinois. G. W. Fulk, Illinois. Mrs. Edward P. Costigan, District of A. Brainard Peet, Delaware. Columbia. J. N. Hagan, North Dakota. BEPORT OF THE NATIONAL, AGRICXILTURAL CONFEHENCE. 199 Committee No 8, Agricultukal Research and Education. Chairman, O. E. .Bradfute, Ohio ; secretary K. F. Kellerman. A. RESEARCH. Chairman, A. F. Woods, Maryland ; secretary, C. V. Piper. E. S. Bayard, Pennsylvania. A. J. R. Curtis, Illinois. Dr. J. N. Harper, Georgia. W. S. Sill, South Dakota. J. L. Hills, Vermont. Herbert Myrick, Massachusetts. W. J. Morse, Maine. Wilmon Newell, Florida. Gustave Ober, Jr., Maryland. F. A. Reid, Arizona. J. Ogden Armour, Illinois. W. H. Stackhouse, Illinois. Oliver M. Lee, New Mexico. G. M. Putnam, New Hampshire. B. AGRICULTURAL EDUCATION. Chairman, T. C. Atkeson, West Virginia ; secretary, D. J. Crosby. G. I. Christie, Indiana. J. F. Duggar, Alabama. John F'ields, Oklahoma. A. W. Gilbert, Massachusetts. H. A. Morgan, Tennessee. W. M. Riggs, South Carolina. A. A. Johnson, New York. H. D. Lute, Nebraska. George McKerrow, Wisconsin. Committee No. 9, A National Forest Policy. Chairman, Giffiord Pinchot ; secretary, Raphael Zon. A. A permanent timber SUPPLY. Chairman, Filibert Roth ; secretary, E. H. Clapp. Mrs Maud Wood Park, District of Albert Manning, New York. Columbia. A. W. Laird, Idaho. W. D. Brookings, District of Columbia. B. COOPERATIVE FOREST PRODUCTION. Chairman, A. C. Davis ; secretary, J. G. Peters. Carl Vrooman, Illinois. B. P. Willlts, Pennsylvania. Arthur Copper, Kansas. C. FOREST RESEARCH. Chairman, H. S. Graves, District of Columbia ; secretary, Joseph Kittredge. C L King, Pennsylvania. J- H. Pratt, North Carolina. John A. McSparran, Pennsylvania. Dan A. Wallace, Minnesota. George W. Sissons,, New York. Committee No. 10, National Land Policies. Chairman, R. A. Pearson, Iowa ; secretary, B. H. Hibbard. A. LAND UTILIZATION. Chairman, H. H. Halladay, Michigan; secretary, R. P. Teele. AV W Turney Texas. Richard T. Ely, Wisconsin. a'g Kahn, District of Columbia. W. B. Hunter, Georgia. C." E.' Spence, Oregon. George Thomas, Utah. A. P. Davis, District of Columbia. B. TENANCY AND LAND OWNERSHIP. Chairman, C. V. Gregory, Illinois ; secretary, L. C. Gray. B. Harris, South Carolina. f- B. Mumford Missouri. E. M. Sweitzer, Pennsylvania. W. L. Austin, District of Columbia. 200 REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. Committee No. 11, Farm Population and Fabm Home. Chairman, S. J. Lowell, New York ; secretary, C. J. Galpln. A. FAKM POPULATION. Chairman, William A. Mather, New York ; secretary, Dr. C. L. Stewart. A. R. Mann, New Tork. Grant H. Slocum, Michigan. Thomas F. Hunt, California. Mrs. H. F. Chaffee, North Dakota. Mrs. J. W, Jones, Maryland. Clarence Poe, North Carolina. Paul L. Vogt, Pennsylvania. Mrs. L. C. Chappell, South Carolina. Mrs. W. C. Martin, Texas. B. THE FABM HOME. Chairman, Mrs. J. C. Ketcham, Michigan ; secretary, Agnes B. Harris. Mrs. Nellie E. Blakemau, Connecticut. George Martin, New Tork. Mrs. Charles W. Sewell, Indiana. Mrs. Carl Williams, Oklahoma. Miss Neale S. Knowles, Iowa. Mrs. W. A. Mather, New York. W. J. Thompson, Maine. S. S. Pennock, Pennsylvania. Committee No. 12, Coordination or State and Federal Legislation. Chairman, B. S. Brigham, Vermont; secretary, Chester Morrill. M. N. Mennel, Ohio. W. G. Jamison, Colorado. H. N. Owen, Minnesota. Milo Reno, Iowa. Charles W. Holmon, District of Columbia. L. L. Olds, Wisconsin. Fred Rasmussen, Pennsylvania. J. M. Whittlesey, Connecticut. Not Assigned to Committees. Hon. Sydney Anderson, chairman of the conference. Wesley Mitchell, New York. Gov. J. M. Parker, Louisiana. James N. Morton, Georgia. M. B. Hare, Arkansas. Thos. McCroskey, Tennessee. Samuel Adams, 111. B. M. Baruch, New York. Manning W. Doherty, Canada. C. H. Markham, Illinois. John E. Pickett, Pennsylvania. J. F. Porter, Tennessee. Hugh Sproat, Idaho. R. H. W. Stone, North Carolina. G. A. Taylor, Indiana. Horace G. Windsor, Missouri. L. J. Wortham, Texas. Mrs. B. John Black, Maryland. Mrs. Thos. 6. Winter, District of Columbia. Mrs. Albert Manning, New York. Hon. G. N. Haugen, House of Repre- sentatives. Hon. I. L. Lenroot, United States Senate. MINORITY EEPORT. section b. waterway transportation. January 26, 1922. I wish to offer the following resolution as a substitute for the paragraphs beginning with " The International Joint Commission appointed " and ending with the words " important project," on page 144: " Whereas the reconstruction of the agricultural and commercial in- dustries of the United States is of immediate necessity and para- mount itnportance, and that cheap transportation is the greatest factor in accomplishing the full economic development of the agri- cultural industry and the proper development of the farm life of the country; and " The farmers having suffered mostly from the after-war deflation and therefore are mostly in need of immediate relief, and a scientific development of all of our internal problems, and especially the de- velopment of our internal and domestic waterways, which will best meet this necessity the quickest and help most to solve not only his transportation and marketing problems, but many of the other dis- advantages under which he is laboring to-day ; and " The complete resuscitation of the commercial life of the country, which will call for the expenditure of a large sum of money out of the Treasury of the United States to bring about the immediate and necessary relief to agriculture : Therefore be it " Resolved^ That all internal improvements within the territory of the United States be made before any expenditures are considered without the territory of the United States, and that all mony ex- pended out of the Treasury of the United States for reconstruction purposes be expended where it can be of the greatest service to the greatest number, in the shortest time, and that all of our rivers and harbors and small navigable streams be improved before any large project is considered, so as to give to the people throughout the entire country direct and immediate relief, and that the Congress of the United States take immediate action and appropriate such money out of the Treasury of the United States that is necessary to im- mediately improve the harbors of the United States to relieve present transportation conditions, as follows : Portsmouth, Boston, New Lon- don, New Haven, Bridgeport, New York, Philadelphia, Trenton, Wilmington (Del.), Baltimore, Wilmington (N. C), Charleston, Savannah, Jacksonville, Mobile, New Orleans, Galveston, Panama, Los Angeles, San Francisco, Portland, Seattle, and all the other harbors within the Great Lakes, and inmiediately improve the in- land waterways connecting the various harbors with the interior to give to agriculture waterway transportation from the interior to the sea, such as the Connecticut Eiver, the Hudson River, the Dela- ware River, the Susquehanna River, the Potomac River, the Ohio 201 202 EEPOBT OF THE NATIONAL AGRICULTUKAL CONFERENCE. Eiver, the Mississippi River, the Missouri River, the Warrior River, the Tombigbee River, the Arkansas River, the Red River, the Tennessee River, and such other rivers and tributaries that need improvement so as to give to the farmer proper and adequate in- land waterway transportation rates; and immediately improve all the canals within the territory of the United States with the same object in view, and immediately take steps to continue that great and important intercoastal canal project connecting Boston with Gal- veston." ' , Peter G. Ten Eyck. The following was not a part of the report of the Secretary of Agriculture to the President. It was added by action of, the House of Representatives on the recommendation of the Committee on Agri- culture : MINOBITY BEPOBT BY HON. PETEE G. TEN EYCK, MEMBER OF THE WATERWAY- TBANSPOETATION COMMITTEE, IN OPPOSI- TION TO THE UNITED STATES GOVERNMENT FINANCING THE CANALIZATION OF THE ST. LAWRENCE RIVER. The location, depth, and width of the Barge Canal in New York State, also the size of its locks, were not a piece of guesswork, nor an experiment, nor were they conceived in ignorance. This project was carefully considered, and after due investigation a corps of engi- neering experts were assembled and .who were men of national ex- perience in waterway. development, studied the subject, and finally came to the conclusion that this type of waterway connecting the Great Lakes and the Hudson River, which leads to the Atlantic Ocean, was the best system that could be provided and would yield the largest return to the country. This decision was not arrived at until after they had given the same attention, the same consideration, and the same study, and the same thought to the St. Lawrence project, (References : House Doc- ument No. 86, 55th Cong., 1st sess.; House Document No. 149, 56th Cong., 2d sess.) I merely bring this to your attention so that you may know that the location, design, and construction of the Barge Canal in New York State were given as much time and thought by just as compe- tent engineers as the International Joint Commission which has just considered the St. Lawrence project, with the same purpose in view as those who have completed the report on the canalization of the St. Lawrence River. You can not do anything of a great benefit to any number of the States of the Union without having a beneficial effect, either directly of indirectly, on all the other States. Neither can you do a serious or irreparable injury to any one or more of the 48 States of the Union without each of the other States being injured to a more or less de- gree, for each and every one of the States is a component part of this great Union of the United States of America. ' When considering any 'Droject as a whole we find that local inter- ests may be adverse in many instances, which make it easv for a feiw to create imaginairy faults where none really exist. We find here a group of States fequfesting a project which will cost sfeveral hundred millions of dollars, which, at its best, will only benefit them REPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. 203 in part or on a small percentage of a few of their products, which in turn will give to another nation entire control over the entire output of these products, which will likewise shift the control of the trans- continental transportation systems of our country on part of our exports and imports to another country, provided that the claims of the proponents of this scheme are true. But, if their claims are not correct, then this project will be accomplished at the expense and loss to a great proportion of the consuming population of their own country. We must remember that our interests are mutual whenever we deal in that which relates to interstate, national, or international sub- jects or projects. Im am not going to discuss the big cost of this project in detail because if this scheme or proposed plan, after being duly considered by the representatives of all the people, and is found to be for the best interests of the entire United States, we should build it without consideration of cost, and I would not oppose it on that ground. When I first raised my voice in protest to this scheme the few States in the Great Lakes watershed had already organized and started their propaganda in the legislative halls of Congress. I feel that all that is necessary is to acquaint the people of the country with the true facts, bring about an intelligent discussion in Con- gress, and create interest in the country at large on the subject, and I feel that the entire population of this great Nation will realize the lack of need of the proposed project. What I wish to do is to educate the people, make them think, make them study, make them demand reliable information from an engi- neering, financial, commercial, transportation, and an economic standpoint, and I am perfectly willing to abide by thfe decision of the people of this country. „ ., , „ . . ^ i ■ 4. We will admit that it is feasible from an engineering standpoint. The United States can carry it out from a financial point of view, but in doing so she will undoubtedly have to cut down on appro- priations for other internal improvements, such as harbor impro^re- ments inland waterway improvements, highway improvements, la)Kl- bank credits, farm loans, appropriations for the benefit of the sick and disabled ex-service men, and numerous other important domestic heeds, and divide the revenue of our own transportation routes with a sem'iforeign route. . ^v.- . ., ^..e^u' If New York State had not given anything to the country for the relief of the shippers on the Great Lakes she might be accused of the " dog-in-the-manger " policy ; she might be accused of opposition from' a financial standpoint to save herself the additional taxes which she would be called upon to pay, which is approximately 30 per cent of the Federal Government's share m anything that the Government undertakes, but to the contrary she has supplied a waterway since 1825 at her own expense, connecting the Great Lakes with the At- lantic Ocean, and has increased its efficiency from time to time until she has expended in the neighborhood of $225,000,000 and has given to the country for its free use without charging the users of the barge canal 1 cent for toll. ^^ ^ ^^ , .j i It has been argued by some that the water-powei* development in conjunction with the transportation will be of immense benefit to the 204 EtPOET OF THE NATIONAL AGEICTJLTURAL, C0NFERENC15. entire community. No doubt water power will be a benefit, but if we want water power it is not necessary that we should build a canal for transportation_ purposes to befog the minds of the people of this country in order to obtain water power. ' If power is the real thing let us spend the money on power, but do not let us load up the power plants with an unnecessary charge, over- load or burden it and thus increase the cost of power to the users so that they will be unable, on account of the cost, to utilize it to the fullest extent possible. I believe that in all future developments and distribution of hydro- electric power due regard should be given to supplying the farmers and the rural communities adjacent to the distributing lines with light, heat, and power at the same minimum cost . which their city brethren enjoy to-day. When we built the Panama Canal we purchased the strip of land across the Isthmus of Panama, and first made it United States terri- tory, and afterwards built the canal therein. If the precedent established and the policy adopted in the construc- tion of the Panama Canal are correct, then let us first negotiate the purchase from the Dominion of Canada and Great Britain of all the land between the present boundary of Canada and the United States and the center of the channel of the St. Lawrence River, and after the amount has been satisfactorily agreed upon let us purchase this territory from Canada. In this way we will obtain at least equal rights to all water power in the St. Lawrence River throughout its entire length from the Great Lakes to the Gulf of the St. Lawrence, with equal opportunity to establish cities on the St. Lawrence River at convenient and advantageous points, so as to obtain aU the ad- vantages from the development of power in the St. Lawrence River from a commercial standpoint, the same as Toronto and the other cities are now contemplating, knowing that the United States will be called upon to pay half of the expense of developing their entire territory. I wish to suggest at this point that before we jointly consider the canalization of the St. Lawrence we negotiate with Canada along the lines set forth with the idea in view of Great Britain ac- cepting the cancellation of part of its present debt in payment of all the territory between the St. Lawrence River and the United States . and the Atlantic Ocean and the Great Lakes, thus making the St. Lawrence River the boundary line between Canada and the United States. After this has been accomplished we can then take up with Canada on a 50-50 basis, and will receive 50 per cent of all the power generated anywhere on the St. Lawrence River. I am not opposed, under present conditions, to Canada building her own canal for transportation purposes, and to dam up that water which she owns for power purposes, but what I am opposed to is the United States spending hundreds of millions of dollars on water transportation development without the territory of the United States, and on which we will only receive a small proportionate share of the water power*- returns, and will have only a partnership in its control. 1. It is most essential that a country should control its transporta- tion systems, both in time of peace and in time of war. BEPORT OF THE NATIONAL AGRICULTURAL CONFERENCE. 205 2. More than 75 per cent of the markets of the world are closer to the ports of Boston, New York, Philadelphia, Baltimore, etc., than to the port of Montreal on the St. Lawrence River. 3. I predict that the cost of transportation between the Gulf of St. liawrence and the Great Lakes will make the use of transatlantic vessels prohibitive. 4. At its best on account of the shortness of the navigable season in Canada they will only be permitted to use the canal on an average of about six months out of the year. 5. In the building of the St. Lawrence Canal, England will gain an entrance to the Great Lakes through her own territory at the ex- pense of the United States. 6. When we built the Panama Canal we did not require financial assistance from other nations, nor did we build it without first ob- taining the territory through which it runs, but on the other hand, it being an international route to-day, certain nations, especially Great Britain, are trying to dictate to us as regards its operations, protec- tion, and tolls. This being true, how much more would Great Britain endeavor to dictate to us if it laid within her territory, as this project will be of international concern, and we will have again invested American money in an enterprise, the policy of which will be con- trolled to a certain extent by foreign nations. 7. I prefer to do as we did when we bought the territory which is now known as the Canal Zone and constnicted the Panama Canal with American money within American territory so that we will have absolute control over it in time of peace as well as in time of war. 8. If Canada controls the export harbor under international law, under certain conditions Great Britain will be in a position to close the harbor, even though we desire to send food through this port to friendly nations in time of war. 9. The policy of the Public Service Commission and the Inter- state Commerce Commission is to oppose the building of a parallel transportation route until the existing route has proven itself in- adequate to take care of the traffic for which it was constructed. 10. The New York State Barge Canal was not completed until after the war had started. The Federal Government later took it over when it took over the railroads under its control. That and the war stifled all private capital from building boats and ware- houses, and investing generally in transportation facilities, or en- gaging in waterway transportation business. Not until the spring of 1921 did the Federal Government release its jurisdiction, as well as its boats, and turn back the canal to the State of New York, after which a number of private individuals and corporations have placed boats upon the canal and have carried this year several millions of tons of freight. They have even carried freight from Duluth, through the Great LakeSj and through the barge canal to New York City via the Hudson Eiver without breaking bulk at the city of Buffalo, and loaded it on ocean going steamers in the harbor of New York, showing conclusively that the barge canal li large enough to handle lake going steamers, if that class of business is profitable. 11. When we need so much money for internal improvements, farm credits, transportation, warehouses, good roads, improved highways, extension of our own inland waterways, improvements 206 BBPORT OF THE WATIONAX, AGKICULTURAL CONFERENCE. in our harbors and docJks, and bonus for our ex-service men, it is ridiculous for the people of the United States to spend $300,000,000 to help an adjoining country to build a paralleling and competitive route in territory without the United States to compete with an ex- isting ail-American route within the territory of the United States. 12. If Great Britain controls, through Canada, the export har- bor and Liverpool the import harbor, as well as the boats in which our grain and farm products are shipped, she will also control the price, and she being a consuming nation, her control of the price will be downward, and the farmers will lose more in the selling price of their commodities than they can possibly gain if all the promises be true of the reductions in the trg,nsportation rates. 13. What the farmers need to-day is immediate relief by being supplied with the necessary water, rail, and highway transportation facilities at reasonable rates. 14. This foreign canal which some are in favor of building in the Dominion of Canada can not be constructed, properly equipped with terminals, boats, and other equipment, within 10 years' time, and what the farmer needs to-day is immediate relief. 15. This money which we are considering to expend abroad could be used to better advantage to equip our waterways with boats, warehouses, grain elevators, terminal facilities, etc., so as to re- duce the rate to a minimum to the public. I can appreciate that during the war there was a great deal of congestion, not only on the Great Lakes but throughout the entire country, but to-day we have more cars, locomotives, and railroads, as well as water transportation facilities, than are actualy needed to take care of the present-day traffic, a!nd we have in addition to the above an entire new waterway system connecting the Great Lakes and the Atlantic Ocean in the form of the New York Barge Canal with a carrying capacity of from 20,000,000 to 25,- 000,000 of tons yearly. In view of this" we do not need the proposed Canadian canal from the Great Lakes to the Atlantic Ocean, paralleling the present one; what we do need and should consider, however, is a canal connect- ing the Great Lakes with the Gulf of Mexico, and I can assure the States bordering on the Mississippi that the people of New York State are with them in their desire for improving American water- ways. The people of the United States are not familiar with the gigantic waterway system that New York State has built single- handed and alone to connect the Great Lakes with the Atlantic Ocean. To those who read, study, and think: Have you ever seen it? What information has even been imparted to you concerning it as regards'* its possibilities? Without full information you can not realize this gigantic piece of engineering which the State of New York has given to the shippers on the Great Lakes so that their products for more than 100 years have had waterway trans- portation facilities to protect them against the exorbitant freight rates, on their products, and has finally constructed and turned over for the use of all the people of the country the greatest system of canals in the entire world free of tolls and free of taxes to any other State in the Union, connecting the Great Lakes with the Atlantic; Ocean. REPORT OF THE NATIONAL, AGRICULTURAL CONFERENCE. 207 If the grain of the country is shipped through the St. Lawrence in the summer time, it will mean that terminal facilities, warehouses, grain elevators will have to be built in Canada, and when the canal is frozen the grain elevators will have to be relieved of their con- tents, and Canadian railroads will be used in the wintertime to carry American products to an open port in Canada, which will cause American labor to suffer in direct proportion to the loss of tonnage shipped through Canada, or we will have to be burdened with a duplicate system of warehouses, canals, and railway facili- ties, which will increase the cost of operation. I believe the country should do everything possible within its power to relieve the great Middle West and the farming districts within the watershed of the Great Lakes and people of the North- west by giving them adequate means of water transportation, by improving the Mississippi, and by improving any other waterway route leading from the Great Lakes to the ocean so long as these routes are within the territory of the United States. From reliable information I have been informed that the in- surance rate on grain shipped from the Great Lakes through the St. Lawrence to Liverpool will be from 1 cent to 2 cents more than if shipped by the present method from the Great Lakes through the harbor of New York. The interest on the larger ships, the extra size of crews, the addi- tional time of the more' expensive vessel, the difference in our navi- gation laws of this and other countries, and the original cost of this expensive project, together with the cost of deepening of the harbors on the Great Lakes for the use of a few vessels will create an unwholesome condition, the outcome of which will increase freight rates rather than diminish them. I would like to read into the record a statement by Mr. Howard W. Selby, general manager Eastetrn States Farmers' Exchange, Springfield, Mass., a cooperative organization which has saved the farmers of the New England States thousands of dollars and handles thousands of tons of western feed annually, from which you will note that the present waterway systems of the country are saving the New England farmers thousands of dollars annually. A fair proportion of the feed and grain used in New England is shipped from the West via lake and rail during the season when the Lakes are open. The freight by this route averages 50 to 75 cents per ton cheaper than by all rail November is the latest shipment now being quoted by the water route and December quotations are consequently higher according to the amount of additional freight. Buyers who are located so that they can take advantage of lake and rail shipment should give consideration to the above in ordering straight cars during the next 30 days. For your further information, I wish to read into the records a statement of Mr. Adam E. Cornelius, an expert on lake and water transportation, who conducts a large Lake transportation company, which own a great many Lake boats of the latest designs arid models. In his remarks he has set forth fully the cost of water transportation using Lake boats in comparison with the cost of transatlantic routes, which shows conclusively that the freight rates on the Great Lakes are far Ifess than on the Atlantic Ocean. The conclusion of which is that the transatlantic steamer traversing the Great Lakes would have to secure a higher rate on its cargo than a Lake steamer, which 92640— H. Doc. 195, 67-2 14 208 REPOKT OF THE NATIONAL AGRICULTXTBAL CONFEBENCE. increase would be greater than the cost of transferring the cargoes at New York and BufFalo with the latest improved devices in terminal equipment. I beg to quote as follows : The amount of business borne on the Great Lakes both east and west bound in a period of eight months has been known to total 100,000,000 tons. Please bear In mind that of this 100,000,000 tons, at least 60,000,000 ' consists of Iron ore shipped from Lake Michigan or Lake Superior ports and consigned no farther East than Lake Erie ports ; that aa additional 30,000,000 tons of •coal are shipped primarily from Lake Erie ports to Lakes Michigan and Su- perior ports and that this total of 90,000,000 tons is not concerned about the St. Lawrence project. Of the remaining 10,000,000 tons, consisting of package ■freight, pig iron, lumber, and grain, very little package freight, pig iron, and lumber moving on the Lakes is for other than local consumption, and the largest moving commodity of the 10,000,000 tons that is worthy of considera]tion is grain. While it is true that some of the grain that is shipped down the Lakes" from Chicago and Duluth is for export, a big part of it is for home consump- tion, and as the population of the country increases and with our own crops probably diminishing as the fertility of the soil decreases, more and more of our grain will be retained until finally there will be no grain for export; but, even at the present time, less than 5 per cent of the 100,000,000 tons is con- cerned about cheaper transportation to the ocean. One argument that has been advanced in favor of this project has come from siich cities in the West as Duluth, Chicago, and Detroit, who have fostered the Idea and belief that the St. Lawrence project would immediately convert such cities into inland ocean ports, and by making theni ocean ports available to ocean ships cheaper transportation to the sea would become effective. Permit me to say that this is an idle dream. The bulk of the business on the Great Lakes is carried in specially constructed flat-bottomed, long, steel boxed ships, having living quarters forward and engines and other living quarters aft, leaving one large unobstructed space con- taining from 30 to 38 large openings or hatches, depending upon the size of the ship, which permits of very rapid loading and unlo'itding of cargoes. In this con- nection I wish to refer to the fact that very recently a ship of 12,000 tons capacity was loaded at Two Harbors, Minn., with a cargo of 112,000 tons of ore in exactly 16J minutes, and that this cargo was taken from said steamer at the port of Conneaut, Ohio, on September 12, In 3 hours and 5 minutes. It is this peculiarly constructed ship that has made these records possible and enabled us to carry freight at ridiculously low figures; in fact, so low that our operation has been considered marvelous by the outside world. These ships are carrying coal from Buffalo to Duluth, a distance of 1,000 miles, for 50 cents per toii, and for years the rate was 30 cents, which is cheaper than you can have it car- ried from the curbstone to your cellar. Because of this special construction, which does not consider the perils of deep-sea navigation, a Great Lakes ship can not be depended upon to load cargoes at lake ports for delivery across the seas, as they are primarily lake ships and can not secure ocean classification. The St. Lawrence Ship Canal, therefore, can not count upon the lake ship as a means of reducing th^ Great Lakes to ocean and foreign port rates. On the contrary, the reduction would, therefore, have to depend upon ocean steamers . plying the Lakes. In considering the ocean steamer as a possible feature in reducing the lake to ocean rates, permit me to make a few comparisons. The average cost of the present Great Lakes freighter of 10,000 tons capacity is $400,000; that of an ocean steamer of the same capacity built during the war was $1,500,000. The average depth of the large lake boat is 19 feet, while that of an ocean steamer of the same capacity is 27 to 30 feet. The approximate crew of a Great Lakes steamer Is 30 men ; that of an ocean steamer 50 men. The Great Lakes steamer will carry her full cargo on Great Lakes draft of 19 feet ; the ocean steamer will carry proHably two-thirds of her cargo on lake draft of 19 feet In making these comparisons, I wish to state that during the war the United States Shipping Board and Emergency Fleet Corporation contracted for the building of a large number of ocean-going steamers to be built in Great Lakes yards. While these steamers were limited by virtue of the canal locks to what Is known as the 3,000 to 3,500 ton type, they could only carry about 1,100 tons of freight on the Wetland Canal draft of 14 feet^ whereas the same size lake- type ship, with flat bottom, carries 2,000 to 2,200 tons on the same draft. EEPORT OF THE NATIONAL AGRICULTUEAL CONFERENCE. 209 Again, the owner of the large lake steamer would consider his property amply ■covered against loss if the ship were insured for $500,000. The premium for such protection, hased on 1921 rates, would be approximately $15,000 per ship. The ocean steamer, on the other hand, because of its greater cost of construc- tion of possibly 300 per cent, would be paying a premium of from $45,000 to -$50,000. By way of further comparison, the ocean steamer, operating in her own ele- ment, for instance, is carrying coal at the present time from Norfolk to Boston, a distance of about 500 miles, on her full draft and capacity, and receiving $1.10 to $1.25 per ton for the same, while the lake ship is carrying coal from Buffalo to Duluth, which is twice the distance, for .50 cents per ton. If the ocean steamer, in her own element, on full draft, can not equal the lake boat's rate, she <;an not expect to be a competitor with the lake boat in the reduction of freight rates on a reduced draft. In addition to this the ocean steamer is handicapped for peculiar lake operation by her large hatch coamings and the great distance between hatches and machinery in the middle of the boat. We (Boland & Cornelius) have acted as agents for such steamers in the. port of Buffalo, where we found but few elevators that could unload them. The ocean steamer, with its construction, therefore, does not adapt itself to lake methods of handling cargoes. Another added expense to the operation of the ocean steamer on the Great Lakes would be the necessity for a set of three pilots, operating on 8-hour shifts, in addition to its regular ocean crew, because the ocean navigator would not have a Great Lakes pilot's license. It should, therefore, be seen that the ocean steamer, because of its greater cost of con- struction and operation, can not be depended upon to reduce the rates as they now exist from the Great Lakes to the sea. Waiving all previous arguments, I contend that the supply of ocean steamers available for cargoes on the Great Lakes would be limited by the few import cargoes that such ocean steamers could locate in foreign ports or on the seaboard for delivery to the Great Lakes. In fact we refer to the fact that the firm of Boland & Cornelius recently purchased a former lake steamer, the William P. Palmer, which we brought back to the Lakes with an ocean crew and under ocean conditions. We took on a cargo of coal at New York at $3 per ton, for St. Johns, New Brunswick, and after discharging this, we took on a cargo of pulp wood in the lower St. Lawrence for Oswego at $8 per cord, and in spite of these two apparently high- paying freights, the said steamer, under ocean operation and an ocean crew, was in debt on arrival at Buffalo. If such was the result operating with cargo what chance would an ocean boat, coming up here light, have to com- pete with lake boats in reducing the lake to ocean rates? , If ocean steamers can not be relied upon to secure import cargoes for the Great Lakes, to make them available for cargoes here, and if they can not economically come to the Great Lakes light, and if, again, by reason of their increased cost of con- struction and operation, they can not be depended upon to reduce the present rates from ports like Duluth and Chicago to the sea, the St. Lawrence River nroiect is of no use to the United States. Bevond the question of a doubt, so far as American freight is concerned, the present waterway via the Erie Canal to the Hudson River and thence to New York is the only means by which we can expect a reduction of freight rates from Great Lakes ports to seaboard and beyond. It is true that the Erie Canal has in the past functioned poorly, but New York State by the expenditure of Siei 000 000 has now completed a waterway that is worthy of every considera- tion ' In addition to this, she has been and is developing a series of terminals nt Buffalo New York, and intermediate points which, when completed, should verv materially reduce the rates from the Lakes to the sea. In the past year American capital and ingenuity, taking advantage of the new canal conditions nnd seeing an opportunity for service, has developed an entirely new and modern ranal boat 254 feet long and 24 feet beam, capable of carrying on its present q* feet draft as high as 50,000 to 60,000 bushels of wheat, in other words, 1,500 to 1 800 tons And, with the elimination of certain bends in the canal, it will he Dossible to build a still longer and larger type of canal boat equal, practically, to the size of the locks, now 810 feet in length. Given a few years in which to overcome the difficulties which the present large-size canal boat has, there Is no doubt that this rate could be reduced by more than 50 per cent. To show the present possibility of improving canal service whereby a reduc- tion of rates can be obtained, we recently loaded one of our own steamers at the 210 EEPORT OF THE STATIONAL AGKICULTTJEAL CONFEBENCE. port of Buffalo with a cargo of nitrate of soda, whicli had been brought by- canal boats from New York, discharged into a warehouse at Buffalo terminal,, then loaded into our steamer for delivery to Washburn, Wis. This cargo, we are told, was delivered to the canal boats by steamer from Chile, and the canal freight was approximately $1.25 per ton. It took something like six days to- load our steamer at Buffalo, and the combined canal and boat rate was probably less than 30 per cent of the railroad rate to the West. Our experience in this case causes us to recommend that the State next turn its attention to the development of proper derrick scows at its Buffalo as well as its New York terminals, which will permit of the very rapid discharge from ocean boat to canal boat and from canal boat to lake steamer. With this accomplished, enabling the loading of the lake steamer in two days, instead of six, a permanent saving in freight rates can be effected. I feel safe in predicting that these boats and others to be built will in the next two or three years be navigating the entire chain of lakes, loading cargoes at all western lake ports for through delivery to New York City, and once this is accomplished, it is safe to say that a stupendous reduction in lake to ocean rates will be effected. In fact, I understand that at the present time one of the new, progressive canal lines is making quotations for the delivery of sulphur cargoes from ocean steamer in New York Harbor direct to destination on Lake Superior. In conclusion permit me to say that if the present Erie Canal, with its terminal program still incomplete, , and with only one year's operation on the part of larger ships, is already able to furnish such wonderful possibilities for reduction in freight rates, it would seem practical for the United States Government to concentrate its atten- tion upon this waterway rather than the spending hundreds of millions of dollars upon the St. Lawrence project, which, when completed, would not offer the relief desired. o