A Farm-Vote Program

January 30, 1956

The President’s farm message is a strange document, full of contradictions. It opens with an unsparing criticism of the farm price-support program. “Mountainous surpluses overshadow everything else,” because “wartime production incentives were too long continued. . . . Were it not for the government’s bulging stocks, farmers would be getting far more for their product today. . . . Both at home and abroad markets have been lost. Foreign farm production has been increased. American exports have declined. Foreign products have been attracted to our shores. . . . Our farmers have had to submit to drastic acreage controls. . . . Even these controls have been self-defeating.”

The logical conclusion from all this would be to stop government farm price support as soon as feasible. Instead, the President attributes all these evils to the Democratic price-support program at 90 percent of “parity.” He assumes the evils will end under Republican “flexible” price support at 75 to 90 percent of parity. No doubt, at slightly lower artificial price props surpluses may pile up at a less appalling rate than otherwise; but they will pile up. “We must stop encouraging the production of surpluses,” says Mr. Eisenhower; and then endorses a plan which must continue to encourage them.

He realizes this; for he immediately proposes another plan to offset this encouragement. This is a “soil bank,” designed to take at least 40 million of the country’s 350 million acres of crop land out of production. These would be planted to trees or grass. Participating farmers would be forbidden even to graze cattle on any land put in the “acreage reserve.”

In other words, under the price-support program, the farmer is given a subsidy to encourage him to produce surpluses, while under the soil-bank program he would get another subsidy to discourage production of surpluses. He would be offered one handout to increase production and then another handout if he agreed not to take advantage of the first one.

This “solution” is full of question marks. The sheer administrative problem of enforcement of this soil-bank program would be enormous. In one part of the message the President admits that acreage controls are almost worthless. “In 1955, on an acreage allotment calculated to yield 10 million bales of cotton, nearly 15 million were harvested.” In short, production per acre can be increased amazingly—given an artificial price incentive. Therefore, beginning with the crop of 1957, the President suggests quantity allotments for cotton instead of acreage control. But acreage control would also be worthless for other crops as long as their prices are government-supported. The whole plan would lead toward complete regimentation of farming, with each farmer told exactly how many pounds or bushels of every crop he could sell, based on his “historic” production.

The President’s message piles up so many subsidies, handouts, and administrative headaches that it is impossible even to list them here. But he does suggest that Congress “consider placing a dollar limit on the size of price-support loans to any one individual or farming unit. . . . Price-support loans of tremendous size have occasionally occurred.” He doesn’t mention figures, but the records show that payments of more than a million dollars have been made to individual farms for growing cotton that nobody wanted to buy. This is surely carrying “relief” to the “needy farmer” pretty far.

Yet while putting a limit on the size of the price-support check to any one farm may mitigate this scandal, it only underlines the absurdity of the whole price-support program. Something like 85 percent of our total farm output comes from the big, efficient farms that are the main beneficiaries of the program. To continue price support mainly to the small producers would be to subsidize and encourage much costly and inefficient at the expense of efficient production.

But hoped-for political advantage is likely to play a much greater role in any new farm program than probable economic consequences.