The Administration has now unveiled its farm program for 1960. The solution it offers for farm problems - its panacea for higher surpluses and lower income - its remedy for farm ills - its answer to the demands of the future - is lower, still lower, farm prices.
Secretary of Agriculture Benson says we must depress wheat prices until they compete with feed grains - he ignores the chaos in both wheat and feed grain prices that is certain to follow. He urges a continuation of the present corn program - and ignores the plight of the corn farmer already suffering from this program. And as for livestock - he refuses even to acknowledge the mounting evidence of a livestock crisis in the near future.
In short it is a clarion call for a continuation of the same disastrous policy Mr. Benson has pursued since coming into office. Last year the farmers of our Nation made less money than in any year since 1942. And only this week they received notice from Mr. Benson that they should expect a further cut in income of between 10 and 12 percent over the next four years.
At the same time that corporate profits will rise an estimated 10 to 15 percent, the Administration program will cut farm income between 10 and 12 percent.
For some reason the wheat farmer in particular is singled out for attack. According to the same report, the Administration wheat program will reduce the cash receipts of the wheat farmer by 30 percent during the next four years.
One may ask who is going to benefit from this relentless Administration attack on farm income. Certainly not the city dwellers of our Nation, who are paying higher food prices. Certainly not the taxpayers, paying more to see surpluses rot in storage than they ever paid before. And certainly not the farmers.
I do not pretend to say that a new Democratic President in the White House would have all the answers to all the problems. I do not agree with those who think that all we have to do is dismiss Mr. Benson and get a new Secretary of Agriculture. This problem is bigger and deeper than one man or even one administration. There are no quick, easy, painless remedies. On the contrary, I think the farmers themselves are getting tired of hearing from politicians in either camp about some new short-term expedient, a wonder drug aimed at treating some current symptom instead of getting at the real problem. I do not intend to repeat such promises today.
But I do believe that any Democratic farm program must both attack the current problems of surpluses and depressed prices and meet the long-range objectives of an expanding economy. This presents a dual challenge.
It cannot be met by a single-minded devotion to unrestricted production at lower and lower prices. Our one billion, 400 million bushel wheat surplus will not melt away as prices are adjusted. It would take a 50 percent reduction in price and would bankrupt one out of three farmers to reduce our enormous surplus problem.
Nor can the farm economy be revived by a deliberate effort to eliminate the family farmer. This effort can only weaken our entire economy.
Wheat is no different from steel - or from automobiles - or from refrigerators. When the steel industry finds itself with excess capacity - as it did about a year and a half ago - it trims production. It did not reduce prices. It raised prices. There was no Administration effort to plow back every third steel company - or even to reduce steel prices. The wheat producer is entitled to the same consideration.
I do not underestimate our wheat crisis. If we did not grow another bushel for the rest of 1960, we would still have enough wheat to meet all our domestic needs, all our export requirements, and still have a larger than necessary carryover in 1961. It costs over $20 million a month just to pay the storage charges on this one crop alone.
Obviously we need a new agricultural policy - the same weary and unsuccessful program Mr. Benson has been pushing since 1952 will not do. Any attempt to control one commodity and not another is pre-doomed to failure, for our farm economy cannot exist half controlled and half free.
Last year the Democratic Congress offered the Administration an emergency wheat program. By reducing acreage 25 percent and increasing the support price to 90 percent, we sought to halt the steady accumulation of wheat in our storage bins. It was estimated it would have saved us $250 million a year.
Unfortunately, an Administration bent upon reducing prices vetoed the bill.
This year, I hope we can pass good, permanent legislation - over a veto, if necessary. Without attempting to speak for all Democrats - without attempting to write a wheat bill here and now - let me say just this: I believe such legislation must have a triple objective -
First, it must stabilize producer income at reasonable levels;
Second, it must allow freedom to plant without Government interference;
Third, it must discourage diversion of wheat to other crops.
This last objective is particularly important if we are to avoid solving the wheat problem at the expense of feed grain producers.
I believe the best hope for accomplishing these objectives lies in a two-price system for wheat; one price will be paid for wheat used for human consumption; a lower price will be paid for wheat used for feed, for seed, or commercially.
The wheat used for human consumption will be controlled by marketing limitations. These limitations should be low enough to allow between 100 million and 200 million bushels in storage to enter the market each year, at 100 percent parity prices. Since CCC stocks cannot be sold at less than parity prices, the wheat produced during the year will increase in price until it reaches that same price level. In this way the farmer’s income will be protected. At the same time he will have complete freedom to harvest as much as he wishes for other purposes, selling the secondary wheat at the free market price.
The accompanying acreage retirement will prevent ruinous competition between wheat and feed grains.
I intend to offer this legislation, and I am confident we will have the whole-hearted support of the wheat growers and the farm organizations.
But forgetting for the moment about parity indexes, acreage allotments, production payments, and other techniques, any long-range farm program should include these six basic principles:
First, farm abundance should be treated as a blessing and not as a curse. There are still more than one billion 800 million people in other lands trying to get by on less than a subsistence diet. There are still tremendous possibilities for using food as a means of capital investment in underdeveloped countries, even in those that have no food shortages. There are still markets in Europe and elsewhere buying less of our foodstuffs today than they did 20 years ago. There are still 17 million Americans going to bed each night suffering from malnutrition.
This year’s census-takers, going from door-to-door, will find that we have become a nation of 180 million people. We will by the end of this century have doubled our population - we will have equaled the population of India in 1951, a year of critical food shortage in that teeming, famine-ridden, drought-stricken country.
What Mr. Benson now complains about in terms of a food surplus could soon turn into a permanent food shortage. Let us not forget that Premier Khrushchev was forced to announce in this year’s economic report that Russian farm production - in such key crops as grain, sugar beets, potatoes and others - was declining while their population was increasing. While he is being handicapped by shortages, let us not be frightened by our surpluses.
Secondly, any national farm program should be based primarily on the promotion and preservation of the family farm. That is the basic unit here in North Dakota - that is the way it must continue to be. We have no wish to become a nation of giant commercial corporation farms and absentee landlords. Our whole vitality as a nation depends on a contrary course. So let us beware of programs that aid most those who need it least - that encourage the big non-compliers by giving them a good support price anyway in election years. Our job is to look out for the family farmer - and we can count on the family farmer to look out for the future of our soil - and the future of our country.
Third, any future farm program should be run for farmers by farmers. Basic administration on the local level should be in the hands of farmer committees elected by farmers themselves. No bureaucrat, no economist or scientist, knows the needs and trends and variations of the local farm picture as well as local farmers. On the national level, we need a Federal Farm Board comprised of leaders from the key commodity groups - a board which can explain the farmer’s needs to the Administration and the Administration’s hopes to the farmer. This would be a board made up of real farmers - and by farmers, I do not mean some of those whom Mr. Benson has appointed to high office - so-called “farmers” who own one cow and ten banks. I mean those who contributed so much to the local administration of our farm programs in the past - and who can and should do so in the future.
Fourth, any Democratic farm program should encourage, not retard, the growth of the cooperative movement. Cooperatives can help the farmer escape some of the cost-price squeeze. They can give him some stability and bargaining power which he otherwise could not have.
Of immediate concern is the current Administration proposal to tax cooperatives and control their private financial obligations. This would penalize rather than help their operations. As I said in my letter of protest to the Secretary of the Treasury a year ago, this proposal would tax most heavily those cooperatives with inadequate cash resources who are least able to bear the tax.
Fifth, any future farm program must concentrate on cutting the farmer’s costs. The high interest rate policy of this Administration has hurt the farmer looking for credit more than anyone else - and it has held him back even further by making it more difficult for him to buy more efficient machinery on the installment plan. The REA program of this Administration has not been one of promoting lower electric rates for our farm homes. It has done little or nothing about the 300,000 farm families that still lack electricity - and little or nothing about the 40 percent of our farm families in this great electronic age who have no telephone service whatsoever. By cutting these costs - keeping freight rates down and keeping them fair - a new administration can save just as much money for the farmer’s pocket as higher farm prices would bring in.
Sixth, and finally, any future farm program should assure our Nation’s farms of a fair share of the national net income. This does not mean that farm prices must always rise - but they should not be the only ones to fall.
A program based upon these six fundamental principles would, I am convinced, restore common sense and common justice to our farm policy. Only then will it be possible to gear national production to international need - to grow food for stomachs and not for storage - to support the farmer’s prices and income at a level which will cover his costs and a reasonable profit; and at the same time substantially reduce the cost of this program to the American taxpayer.
I am convinced that the farmers of this country - particularly if they are given a major voice in shaping and administering this policy - will support it and cooperate with it. This is not a matter of partisan politics - and it is not even a matter only of farm income. For our basic concern is not the interest of any single political party, or the interests of any single group in our economy. Our basic interest is the national interest - and dedicating ourselves to that objective, we can go forward with renewed faith in the future of our land.
Source: Papers of John F. Kennedy. Pre-Presidential Papers. Senate Files, Box 906, "Democratic committee dinner, Jamestown, North Dakota, 6 February 1960." John F. Kennedy Presidential Library.