Show Secretary Henry C. C Wallace States Case of f the Farmer I 1 By Henry C. C Wallace Secretary or Ot Agriculture Let me speak first or of the agricultural agricultural agricultural tural situation in general I 1 thing thinE if we c can n get an understanding of this the proper work of the department department department depart depart- ment of agriculture ture will become ap ap- a parent We must approach It from two angles first present conditions which are decidedly unusual ana and s second cond conditions s which may may develop devel- devel op In the future I doubt whether the people of at the I east realize just wh what t has has happened happened d to the farmers ot of the producing sections sec sec- Take Taker the grain and livestock producing country country of the central west vest for example and I 1 speak of at this because it is tl the e region with which I am most familiar and also because it is the region which gives us our great surplus crops W We havethe have havethe havethe the finest rural taken as asa asa asa a whole the world has ever seen our farmers average very high in Intelligence Intelligence intelligence In In- they produce more per perman perman perman man than almost any other farmers in in in- inthe the world they have adopted the most advanced system of or ext extensive farming yet yet- developed Notwithstanding Notwithstanding Notwithstanding standing all this they are now in s a most trying period and are suffering severe financial losses Farmers throughout the nation Dation especially those in the south and west are exactly exactly exactly ex ex- the same trouble The cotton farmers of the south the rice farmers farmers farmers farm farm- ers the cattle and sheep growers of the far west the fruit fruit growers allare all allare are passing through this same valley valley valley val val- ley of discouragement and financial stress Situation Not Understood People who who are are not r familiar with agriculture find it hard to understand understand understand under under- stand the sl situation They refuse to believe that the depression is as serious serious serious se se- rious as it really Is Is lh They y point to the high value of our land to to- the high prices at which farm were selling prior to this heavy drop to the large number of automobiles automobiles automobiles auto auto- mobiles owned by farmers to the apparent wealth and comfort on every every every ev ev- ery side and they refuse to take seriously Seriously seriously se Se- what the farmers say concerning concerning concerning con con- their troubles There are two causes for this wide widespread widespread spread agricultural depression One is the high cost of production last year jear If we Include all the factors which properly enter Into the cost of production we find for example that the cost of producing a a. a bushel a-bushel of corn corn In Iowa the greatest corn state was more than 90 cents This Includes the land and cost tho the tho labor laboi cost and everything else elso which ought to be be Included Many people say You are figuring figuring figur figur- gur- gur ing the tho land at an inflated price You should not do that The farmer did not p that y-that that price for the tho land Inno He ne wants dividends on water water waterLand Land Prices Discussed It is true that the land charge Is considered on the basis of ot its value a year ago but it is' is also true that the advance in land prices was not nearly as great as many people sup sup- pose They hear of the occasional sales at or an acre and andr 1 4 r assume that that represents the av ar Nothing of or the sort Bort The average av av- average advance in the value alue of our au rich corn belt land was only about 60 pr cent above prewar values It must be remembered also that In th tnt the principal corn cern states over half the theland theland theland land is farmed by tenants and these tenants mostly had to pay rent on on the basis of the advanced land values It Is true further that if we omit the land charge altogether the price which the farmer can get for a bushel bush bush- el of corn carn is still sUll considerably bel below what It cost him to produce it The largest it item m of cost in corn corn production production tion is not land but labor The man who has be been n farming his own own land and who has sa saved v d' d his hll money has prospered The five fire years prior to 1920 were profitable years especially to the grain farmer farm farm- er who was so fortunate as to have good crops If It he exercised ordinary ordinary ordin ordin- ary intelligence he made more money than he ever before made at farming Those years were not so 80 profitable to the livestock farmer The man who grew his own livestock and own grain and fed his grain to the livestock on the whole made money although not as much as if he had sold the grain instead of feeding it The man who bought the livestock and bought the grain and fed the grain to the livestock o of oa the average lost money Whet hogs were selling at 20 per hundredweight hundredweight hundredweight hun hun- everybody seemed to think the hog feeder was growing rich but most of the time when h hop hogs P were selling at those high figures themen themen the men men who had to buy the grain to feed the hogs lost money Product Prices Drop The second cause of the farmer farmers trouble is this Prices of farm products products pro pro- ducts have dropped out of all proportion proportion proportion pro pro- portion to the prices of other things as as well as out of all proportion to the cost of production For example the price of Cora and oats today on an Iowa farm fana S. S 1 about 20 per cent below the normal price of or these crops before the war war The present price of fat tat cattle and j of hogs is from 20 to 25 per Ce cent t above the prewar normal if we tak take s Chicago prices but brit on the farm the prices of ot both cattle and hogs are down to prewar normal Now note the prices of some of the things the farmer must buy Wages Wag of farm hands are about percent per percent percent cent above the prewar normal railroad railroad railroad rail rail- road rates are from 70 to 90 per cent above prewar norm normal l ouch such b basic sla commodities as pig iron coke petroleum petroleum petroleum petro petro- leum lumber Portland cement are far above the prewar normal normal from from to and in some cases 20 i- i iper per cent above the Uie prewar normal wages and railroad wages are both more than per cent above the prewar normal 4 j jis In other words while the farmer i Is selling the things he produces at prices no higher and for groat surplus surplus sur ear plus crops lower than the prewar t normal he must buy practically ev- ev everything ev everything he needs at prices from 50 r i Con Continued on Page age Four J v I J CAS CASE OF Oli THE FARMER 1 From Page One to per cent above the prewar normal The severe agricultural depression is inevitable as long as X such a condition exists and this depression de- de will certainly be communicated Gated cat d to industry and business generally gener gener- ally Situation is Challenge It Ills Is a situation which should challenge challenge chal chal- challenge lenge the very best thought of the entire nation If It continues the trouble will be communicated to everyone everone We Ve are brothers one or another Anything which hurts the farmer will wm very soon be communicated to all of our citizens The r farmers represent probably 35 to 40 per percent cent of the population Any Anything Anything thing which seriously affects their buying power will bring trouble to the people who make or deal In the Uie things the farmer buys It is a terrible indictment of our modern civilization when this this great great country Is In the period of what almost almost almost al- al most might be called economic chaos because of our great surplus food supply while across the seas in both directions almost half the world Is suffering for want of If f our statesmen had given more I J thought to getting th the world back on ona I. I a sound economic basis and perhaps r had spent less time on s schemes emes and theories they would have rendered a greater contribution to to the peace and orderliness and happiness of the people of the earth Duty Evident n L. L Now as to this present situation I a surely Burely the duty of the department r 4 of agriculture is evident We should should do everything possible to find an out- out let for this great food surplus We yve I should search for ways to produce I more cheaply Our scientific men should try to find new uses for our surplus crops We should help develop develop de develop de- de more efficient marketing systems systems te ns straightening curves and lowering lowering lowering low low- ering the grades between the producer producer producer pro pro- ducer and the It is a time for every man who can help to take hold As in the days when we dragged dragg d our our fire engines by hand to the scene of the fire and every good citizen citizen rushed out and took hold of the long rope and did his bit so we must do now Every good citizen no no matter in what business he may maybe mayle be le engaged should do what he can canto canto of to help the the farmers through this period period pe pe- pe- pe nod of depression not for the sake of oC helping the farmer alone but for forthe forthe forthe the sake of helping himself We can not hope to reach normal conditions until we arrive on a price level which will be fair to all our people and all products Farm products products products pro pro- ducts must come up In price and other products come down until the thea r y J 1 a J a T r L A I normal relation between them has I been restored stored This talk of bringing bringing bringIng bring bring- ing prices price's whether farm prices or other prices back to the prewar nomad nomal nomal no- no mal mad Is mor morally wrong wrong and economically economically cally caBy Impossible We incurred a heavy national debt on the Inflated prices If It we could force all prices back to the prewar normal which normal which we cannot cannot It it would be equivalent to just about doubling that debt We c can n pay off orr our debts much easier if we maintain a price level more nearly the level at which the debts were incurred Of course the excessively excessively excessively ex ex- high prices which prevailed prevail prevail- ed during the war can not continue but if we should try to bring about a level say 70 per cent above the prewar normal everybody would be better off Hopeful Note Struck We will get through this period The nation is not going bankrupt The farmers are no not going bankrupt Neither are they going to lie down on their job fob Gradually farm prices will wUl be brought into fair relation with other prices and we will go ahead hitting on all aU cylinders But there isi if II another thing In the long longrun run run run-a a more important phase of our agricultural problem which w we have been slow in considering Let me sketch briefly the development of our agriculture The farmers of the United States State during the past seventy years have on the average produced and sold grains and livestock at less than the cost of production If It we take Into consideration all the factors properly enter into production costs What I mean Is that if if It the farmer would practice a sound system of business economy charging a fair interest on the capital invested both in ps his farm and his farm equipment a fair wage for the actual labor expended expended expended ex ex- on the farm against his receipts receipts receipts re re- from CrOIn the marketing of his crops it would be found that he has not received for them enough to cover cover cover cov cov- er his act actual al costs We will omit the value of the fertility of his soil which Is In In effect a a portion of his capital and which he has marketed in his crops but which we simply throw in for good measure although this must be replaced if crop production production production pro pro- Is to be maintained I know that when a statement of this kind kindis is made many people question It They think of individual farmers whom they have known and who have become very well to do but I Iam Iam Iam am speaking of the average farmer the farmers as a mass and the statement statement statement state state- ment I have just made is an absolutely absolutely truthful statement which has been abundantly corroborated by scientific investigation l Farmer Willing to Take Loss Los 1 The farmers have been able and I e L willing to seU sell their crops at less i than the tho actual cost of production I because first they have been willing willingto to accept the value of tie tAe farm as ahome a ahome a ahome home as a place to raise their childre children children chil chil- dren as a part of tho the substantial re reward reward ro re- ward for their work and second because as our population has In Increased Increased increased In- In creased there has been a steady In Increase In- In crease creaso In the value of the farm land In times past therefore the young farmer who could get enough ahead ta to make a very small payment on apiece a apiece piece prece of land land enough enough to give him hima a foothold and foothold and who had a lot athard of at hard work in him and who had a good wife as most of them have has been een able by living very economically economically cally denying himself and his wife the luxuries and many of the comforts comforts comforts com com- forts of or m life to hang on paying outon outon out outon on the farm and finally to see it growing into a valuable piece picco of property During a all l this period we have been a great surplus producing food-producing nation We Vve have grown more food than our own people could consume As a result we have had to compete with the farmers of the world In the great great consuming markets an and take prices fixed by that competition Another result of this great surplus of food was to stimulate our Industrial Industrial industrial Indus Indus- trial development and to build up UI our commercial enterprises enterprises of all kinds until now more more than one-half one of all our people live In the cities and industrial centers Drift From Front farm Parm Discussed The steady increase in the value of our land and the rel relatively low prices pric prIc- es for farm products has caused a ac c constant drift of young farmers to the towns and cities where they I thought they could secure better pay for their labor and could see better I opportunities to advance themselves In a a material way In some of our heaviest producing states there are not as many people on the farms to today today today to- to day as there were were thirty or forty years ago This movement from the farm to t the e city efty has been a a perfectly natural movement and fully justified by conditions It will continue as long as the cities offer otter greater financial financial financial finan finan- cial rewards greater opportunities for advancement more comfortable living JIving conditions and bett better r social educational and religious privileges It Is the Inevitable result of economIc econom economic econom econom- ic conditions and no amount of talk extolling the beauty of farm farm life Ufe can stop it Nor has this r relative laUve decline In the producing population been a avery avery avery very serious matter up to the present present pres pres- ent time Certainly it not has has snot not been serious from the farmers' farmers viewpoint We can aI not keep up this galtin gaitin the fu fu- fu ture Consumption has almost overtaken overtaken overtaken over over- taken production under normal world conditions Production Depends on Price Most of our fertile land which can be farmed profitably without expensive sive reclamation has been taken up We still have l large rge are areas s |