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purpose for the past several months. In the meantime, this unnecessary additional expense has been added to marketing costs.
Only after it became evident that Congress might amend the act to compel OPS to suspend controls on these products did OPS show any interest in suspending these fantastic price ceilings. Now they are in the process of suspending some of these controls, but are lowering ceiling prices so that they will be subject to recontrol long before market prices should reach the previous ceilings. This is how OPS has shown their good faith in eliminating unnecessary red tape which they publicly profess to abhor. OPS has openly defied Congress in at least one instance by maintaining ceiling prices on pork products in violation of the provisions of the Defense Production Act. There is no evidence that this agency will show any more tendency to abide by either the provisions of the act or the intent of Congress if a compulsory decontrol provision should be written into the law. The only way Congress can prevent these practices of OPS is by eliminating title IV of the Defense Production Act. We urge that this be done now.
Mr. Chairman, may the charts accompanying my statement be included in the record?
The CHAIRMAN. That may be done.
Mr. OWEN. Thank you, Mr. Chairman.
Mr. BARRETT. I was wondering, Mr. Owen, if you could tell us which group in the industry is for slaughter quotas.
Mr. OWEN. For slaughter quotas?
Mr. OWEN. Well, I can tell you that the entire livestock industry is against slaughter quotas because we know the difficulties that we had during the period of 4 months last year when we had slaughter quotas.
To use an example, I forget the exact date now but in Milwaukee they had a large run of calves. The packers there told the commission men, the salesmen, that they did not have enough quota to slaughter those calves.
I happened to be in Washington at the time and I called OPS and asked what they were going to do about it and they said "Oh, there is just confusion in the market. This will all clear up in a week or 10 days."
In the meantime, you have the most perishable livestock item in the country, young calves. The humane society would insist that you feed those calves, and here are thousands of calves laying around, waiting for OPS to make up their minds whether they are going to increase slaughter quotas or not. That thing occurred all over the country.
I can tell you that the livestock industry is absolutely unanimous against slaughter quotas.
Some of the packers, I believe, have been in favor of livestock slaughter quotas. Personally, I do not think it guarantees them
getting their quota. They think it guarantees them getting their proportion of the total. However, I do not think slaughter quotas have anything to do with them getting their proportion of the total.
The charts that I have attached to my statement, I believe, show how it is the price control that causes livestock to move out of normal channels, and putting slaughter quotas on does not control it.
Mr. BARRETT. I do not think you understood my question. Mr. La Roe said there are two groups, one which approves quotas and the other group which does not. He also mentioned the big four. Which group is the big four?
Mr. Owen. As I understood Mr. LaRoe, he meant--and if he is still in the room, he can check me on this—he meant that within his own group, that he had some members who were in favor of slaughter quotas and some who were not.
I cannot speak for the packers at all but my impression has been that the big packers and small packers both have been predominantly in favor of not having slaughter quotas. But I cannot be sure on that. I cannot speak for the packing industry.
The CHAIRMAN. If there are no further questions, you may stand aside.
We are glad to have your views.
The CLERK. The next witness is Mr. Wilbur L. Plager of the Iowa Swine Producers' Association.
The CHAIRMAN. You may identify yourself, Mr. Plager, and present your statement.
Mr. PLAGER. I am Wilbur L. Plager, field secretary of the Iowa Swine Producers' Association, State House, Des Moines, Iowa.
Mr. Talle. By the way, if I may interrupt you, your home is actually at Blairsburg?
Mr. PLAGER. That is right, Blairsburg, Iowa.
STATEMENT OF WILBUR L. PLAGER, FIELD SECRETARY OF THE
IOWA SWINE PRODUCERS' ASSOCIATION, DES MOINES, IOWA Mr. PLAGER. My experience in farming started when at 10 years of age I enrolled in 4-H Club work. I spent 10 years feeding and showing pigs and other types of livestock. I started farming when I was 20 and farmed for 15 years, until losing my hand in a farmmachine accident.
I then went on the road and spent 5 years with the purebred Berkshire and Duroc Associations before becoming field secretary for the lowa Swine Producers' Association, for which I have worked for the past 6 years.
I was a director and officer of the Iowa Swine Producers' Association for many years while farming. I still maintain a half interest in a farming operation on my farm, so I don't 'fess to be a white-collar farmer who knows all the answers, but one who has had some experience in the actual raising of hogs.
The officers of our association are all actual swine producers and represent the nearly 200,000 swine producers of Iowa, who raise on an average of one out of every five hogs that go to market.
Hogs have been responsible from year to year for 40 to 47 percent of farm income of Iowa and consume 45 percent of the corn produced in Iowa, and of course we lead all other States by a good margin in hog production, in fact raising more hogs than the next two States to
My job as field secretary for the Iowa Swine Producers' Association has given me contacts with all segments of the swine industry--feed companies, slaughtering plants, with the many producers, both prebred and commercial, and I work with many other States in conjunction with their swine problems, and I attend and judge fairs and shows all over the United States.
The ideas that I am trying to convey will follow practically 100 percent the thinking of the swine producers of Iowa. My contacts with swine producers of other States have shown me their thinking is exactly the same as ours.
The recent experience with controls and looking through history of controls of our country and other countries have shown us very definitely that they are of no value in holding down inflation. History has shown us the housewife is the best stabilizer of prices. When prices become too high, she is quick to let the producer know her reactions toward buying. First, I probably should say that farmers. as a whole are as patriotic a group of people as help make up our Nation and that we realize that all segments that make up our country must prosper for all to prosper.
When any one segment of our Nation becomes too powerful and things become out of balance they generally pay for it dearly in the long run. Capital has seen this happen. Labor may be on the verge of this at the present time and agriculture has paid for the same privilege at any time that it had the whip hand. All must be somewhat equal for all to survive to the best advantage.
We certainly are against any aggression such as is facing us at the present time and want to do our share to help combat this but let us not be so naive as to think if we hold inflation we will be able to avert the reduction in the level of living brought about by rearmament.
Today, the feat of inflation and enthusiasm for price control on the part of some governmental agencies has become a part of our economic doctrine. Much of this has been manufactured at the expense of our society to create jobs for a chosen few.
The fear of inflation has been preached too long and its failure to really materialize has become almost like the bride who was left stranded at the altar. Our country was built upon a reasonable amount of freedom in the markets which encouraged production beyond that of any country, and helped to build and make our country great.
If we lose out to the enemies of freedom it will not be because our price index showed a rise of a few points. The No. 1 economic problem is to keep our country flexible to meet the changing needs brought on by domestic and international developments. This can't be done with frozen prices any more than I can keep my car on the road with a locked steering wheel.
One way to control inflation is to take the money away from the people. A recent order loosening the curbs on buying is, to me, a direct contrast from ceilings. It looks like some people here in
Washington are fearing deflation and yet want to be prepared to oppose inflation. To me, that is only double talk. Some have preached cheap food, high wages-again double talk.
I know of no record of any nation that underwent a runaway inflation as long as its production was intact. Many of the countries that have resorted to ceilings have had runaway inflation in spite of the controls. If controls are kept for any length of time we may fear to open the gates and so continue to live with regimentation.
In England, they probably understand this better than we do. They fix prices, rationed and subsidized agricultural commodities pretty well across the board. They had to do this to make their system work. Evidently there has been some change in their thinking, at least it showed up in their last election. This is an election year and it might be wise to think about this. The people in Iowa were scared by threats of the administration in the last election but doubt very much if they can be scared as badly this time.
History has proven to us in the past decade that it is far easier to establish an agency than to get rid of it. Too much Government control can lead to one of the "isms” that we are fighting, none of which are good and none of which any hog farmer would be for.
Let's not have controls lead us into what we are fighting against. Perpetual motion has defied the scientists for centuries. The law of supply and demand has never waivered since the beginning of time. No economist is smart enought to harness it.
It is very difficult to enforce any law that a large majority of people are not in favor of. Certainly this feeling is existing toward OPŠ regulations. Honesty and respect for the law are virtues which are already frail enough so one has no wish to see this extra burden and temptation placed on them.
I don't think this last sentence needs any further explanation. The needless worry about inflation a year ago gives us far less to worry about this year than it did a year ago. It could have been heeded a year ago.
Just before I left home, Herb Howell of Iowa State College in charge of Farm and Business Management Association, had just summarized the figures from eastern Iowa which showed a 21 percent drop in farm income and about like percentage decrease in returns from $100 worth of feed fed to livestock. Now these are actual figures of some of the better farmers in a section of Iowa which has had the best crops in the past 2 years. This will be down even more in other areas and by average farmers.
Certainly this last year has proven there was about as much need for ceilings on pork as a hog has for two tails. Farm operating costs are definitely up and the income is not holding its own. Some groups of labor have had several raises. I don't know of very many on agricultural products.
Only 2 months since pork has been placed under ceilings have we been anywhere near ceiling prices, with bacon selling 34 percent under the ceiling price and other pork cuts nearly as far under ceiling prices and the country still spending only 5% percent of its disposable income for meats, the same as it has for years.
The swine producers last year raised next to the largest crop of hogs that has ever been grown in the history of the United States. The controls hindered free movement of pork products through the