There is neither logic, justice nor fair play in the Administration proposal to impose new taxes upon cooperatives. This proposal would require every co-op to pay taxes upon the income which it ultimately distributed unless the distribution was made within three years and the interest rate was at least 4 percent. No other business has its interest rates and maturities regulated by the Government.
I hope the Administration will withdraw this proposal. If it does not, I am confident that the Congress will not permit such discrimination against farm cooperatives.
The cooperative movement offers one of the few remaining hopes for young men and women who today might otherwise leave the farms. It offers them an element of protection, stability and bargaining power which they would not otherwise possess. It offers them an opportunity to fight the inflationary cost-prize squeeze.
Farm cooperatives must be encouraged and expanded – not handicapped. In Wisconsin, the farmer gets 7 cents a quart for milk that costs the consumer 23 cents. But an expanded cooperative movement can raise prices to the farmer at the same time it reduces prices to the consumer. It can help place the farmer in the same position as his counterpart in industry when bargaining for a fair market price.
I believe that a stronger cooperative movement is essential to any program for a stronger farm economy.
Source: Papers of John F. Kennedy. Pre-Presidential Papers. Senate Files, Box 907, "Manitowoc, Wisconsin, 30 March 1960." John F. Kennedy Presidential Library.