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markets. The housewife would have bought more pork for less money without controls than she did with them.

Under this 5% percent of disposable income the consumption of meat has risen per capita in the United Sttaes by 20 pounds, in the past 25 years, which means that we are eating better, receiving 20 pounds, more for the same percentage in disposable income.

We are not asking for any Government help or any subsidies-in fact, the hog producers opposed using the hogs a few years ago as a guinea pig for trying out the Brannan plan. Instead, we thought it better and have gone along with the packers and the retail men on a good advertising program which placed more pork on the tables of America at a reasonable figure and at no cost to the Government.

A large supply of pork vanished over night and in a smoother order than it did under controls this winter. In a country like ours, with a tradition of freedom and individual rights, nobody becomes very disturbed about two people getting together on a deal mutually satisfactory to both parties. Competition is what has made our country great. It is what makes you and I do a better job.

Our country was built upon the incentive to produce. Under controls initiative to produce is taken away. This was shown when there was a decrease in the number of sows kept for farrowing, due to controls, long before a short grain crop was in sight and, of course, there was a bigger reduction when that became evident. We will have a rather normal or average crop of hogs this year. Cattle numbers are up and we feel that there will be plenty of meat at reasonable prices and what I mean by reasonable is that in our country more meat can be bought for the same amount of work than in any other country in the world.

Farmers by nature like to produce. They are willing to gamble against reasonable odds, always trying to do a little better job. Any controls are liable to affect the future market and demand for farm products. Under controls, the incentive to do a better job is lost. Our educational work toward producing a better product is lost under controls.

Not all hogs are the same. We have the same situation that existed with the cotton people when controls were placed upon them. There is a wide variation, as you can see by the picture of the two pork chops. All hogs are not worth the same price.

The lack of this incentive to produce a better product will be a big handicap to future consumption of pork products.

Now, turning to my charts, you can see that those two hogs are fed exactly the same feed. Under OPS prices the prices for those are entirely the same, and it takes away the incentive for producing a better product. All educational work is lost through that.

Now turning to my charts, chart 1: At the present time, the potato situation is a good example of what controls can do. About the only thing you can buy today are seed potatoes. They are pretty high eating at those prices. A lot of seed potatoes became available over night. There is an indication that these potatoes are being dumped in the places where the ceilings are higher. Without controls, the potatoes would be shipped and sold where the demand is for them and that sort of distribution will be far better than under controls.

Hog production is a long-time process. Plans must be made a year ahead before the actual hog goes to town. If prices of hogs and

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 OPS 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 54 percent of its disposable income for meats, the same as it has for years. Tbe 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

markets. The housewife would have bought more pork for less money without controls than she did with them.

Under this 5% percent of disposable income the consumption of meat has risen per capita in the United Sttaes by 20 pounds, in the past 25 years, which means that we are eating better, receiving 20 pounds, more for the same percentage in disposable income.

We are not asking for any Government help or any subsidies-in fact, the hog producers opposed using the hogs a few years ago as a guinea pig for trying out the Brannan plan. Instead, we thought it better and have gone along with the packers and the retail men on a good advertising program which placed more pork on the tables of America at a reasonable figure and at no cost to the Government.

A large supply of pork vanished over night and in a smoother order than it did under controls this winter. In a country like ours, with a tradition of freedom and individual rights, nobody becomes very disturbed about two people getting together on a deal mutually satisfactory to both parties. Competition is what has made our country great. It is what makes you and I do a better job.

Our country was built upon the incentive to produce. Under controls initiative to produce is taken away.

This was shown when there was a decrease in the number of sows kept for farrowing, due to controls, long before a short grain crop was in sight and, of course, there was a bigger reduction when that became evident. We will have a rather normal or average crop of hogs this year.

Cattle numbers are up and we feel that there will be plenty of meat at reasonable prices and what I mean by reasonable is that in our country more meat can be bought for the same amount of work than in any other country in the world.

Farmers by nature like to produce. They are willing to gamble against reasonable odds, always trying to do a little better job. Any controls are liable to affect the future market and demand for farm products. Under controls, the incentive to do a better job is lost. Our educational work toward producing a better product is lost under controls. Not all hogs are the same.

We have the same situation that existed with the cotton people when controls were placed upon them. There is a wide variation, as you can see by the picture of the two pork chops. All hogs are not worth the same price.

The lack of this incentive to produce a better product will be a big handicap to future consumption of pork products.

Now, turning to my charts, you can see that those two hogs are fed exactly the same feed. Under OPS prices the prices for those are entirely the same, and it takes away the incentive for producing a better product. All educational work is lost through that.

Now turning to my charts, chart 1: At the present time, the potato situation is a good example of what controls can do. About the only thing you can buy today are seed potatoes. They are pretty high eating at those prices. A lot of seed potatoes became available over night. There is an indication that these potatoes are being dumped in the places where the ceilings are higher. Without controls, the potatoes would be shipped and sold where the demand is for them and that sort of distribution will be far better than under controls.

Hog production is a long-time process. Plans must be made a year ahead before the actual hog goes to town. If prices of hogs and

corn are fixed at a relationship favorable to hogs, management can only expand hog production in response to this fixed price until suddenly the country runs low on feed.

Prices may be attractive for the product at the time they are frozen, but they don't stay that way. Along comes a short crop or a changing need, and the old ceiling is no longer the right one. Changes are not made in time; it takes an administrator a long time to make up his mind that the ceiling is wrong, and still longer to correct it.

It looks like some manufacturers are being guaranteed a reasonable profit. One only has to look at the corn-hog ratio to show that the hog producer is a long way from any guaranty in profit. If we are going to have to suffer the handicaps of ceilings, then we should be protected by floors. Just recently Mr. Brannan started buying pork after a long winter of a sluggish hog market that was operating far under the ceiling price for pork.

Now, at a time when pork is about to take its seasonal price rise, we finally get help in the buying of pork for school lunches, only to help create probably more disturbance in the market.

To me, it is like locking the barn after the hog has been stolen. I hope that the Democrats use this as campaign material this fall. If they do, every hog farmer in the United States will remember the price of pork last winter.

I might say that I voted for almost as many Democrats as I have Republicans in my life, and I have a good many Democratic friends back home who feel the same way about it.

Meat is a perishable product, and there must be a lot of fluctuation in the disposition of it in an orderly fashion.

In the meat business we have plenty of proof to show that any time a meat product has started pushing ceilings, controls lost their effectiveness and has only stimulated tie-in sales, upgrading, short weighing, and false billing, with the result that the long-time legitimate operator is gradually squeezed out of business. This was shown when ceilings were put on cattle. This kind of operation has never been of any benefit to the housewife,

One of the silliest statements coming out of OPS is as follows:

It is anticipated, in view of the large size of the present hog population, that in future months hog prices will decline substantially below current price levels. Consideration will be given to the question of whether to issue revised wholesale pork ceilings more accurately reflecting the condition in the live-hog market if the anticipated decline in live-hog prices occurs. These revised prices would, of course, be subject to automatic adjustment upward to the parity level to permit packers to pay parity prices when the market price of live hogs starts to climb.

The only benefit I could have seen out of this would have been for creating jobs for quite a few defeated politicians within the ranks of the OPS. Certainly the folly on this kind of thinking needs no further explanation.

The OPS waved a red flag in front of meat retailers before ceiling prices were placed upon pork. Prices rose in order to establish & favorable ceiling. This winter and spring I have seen No. 1 bacon, wholesaling at 43 cents, selling in stores at 69 cents. A 26-cent mark-up is more than the producer makes on the whole hog this winter. In defense of the retailer, with the mass of regulations he must cope with, I would not blame him for locking up shop and going fishing

I would like to quote from Prof. Don Paarlberg, of Purdue University, as follows:

First, that the real problem is maximum production of the appropriate goods and services, not inflation control. The beneficial effects of inflation have been much underrated, in my opinion, and the unfavorable effects much exaggerated.

Secondly, if a price freeze really comes—and what we've had now is not a real freeze but merely a cool spell—then we become a Nation of lawbreakers, wheedlers, scroungers, and special pleaders. I am not saying that direct controls will not work; I am merely saying that the cost of making them work might well be greater than the questionable benefits derived therefrom and greater than a free people would long tolerate.

Thirdly, if inflation control is desired, there are better ways of accomplishing this objective than price freezes; namely, heavy taxation and credit control. We need not burn down the house to roast the pig.

There is an intriguing phrase called “The point of no return." An aviator starts out on a mission with a certain supply of gasoline, and after a time may reach a point where he doesn't have enough gasoline to return to the base. This is the point of no return. Every flyer thinks carefully before he passes that point.

There can be, I think, a point of no return in economic affairs. We may start off on some mission not too well conceived, and bumble about, issuing directives, patching the leaks, and patching the patches until we pass the point of no return. Affairs then have gone so far from equilibrium and the shock of return would be so great that we lack whatever it takes to slough off the controls.

If we should pass the point of no return after a full appraisal of the advantages and disadvantages of our new position as compared with our old base, then we need have no grief. I believe in democracy and have immense faith in the soundness of informed public opinion.

But, if we embark on some program after considering only the short-run implications and then find ourselves hedged about with unsuspected evils so that we wish to return to our base but can't, that is a different matter. I feel strongly the need for economists to tell the public what's inside this handsome package labeled "direct controls.” My guess is that, if we went in for a full system of price controls and stayed with it for 10 years, we would have passed the point of no return. Price freedom is the key to all other economic freedoms.

If controls are removed and there is any increase in price, it must be attributed to two things: (1) Seasonal price rise. If controls are taken off by the 1st of July, the public should be informed that it is a season when meat prices are normally rising and that any similar rise should be explained and not used as propaganda medium for this continuance. See chart 2. (2) Any further rise in meat prices should be charged to controls that have been placed upon meats during the past which discouraged normal production.

In conclusion, there is nothing about the price of most things today outside of a few critical materials that would start to encourage the extending of controls. In fact, to pay our national debt we better be worrying about keeping prices somewhere near where they are because we can never pay off our national debt and arm against our aggressors on high-priced dollars.

Last, we can see no need for the wasting of manpower in operating an agency to do a job that the housewife has done for years and has been glad to do it and has never charged our country one red cent to do.

That is far cheaper than the one-quarter million dollars a day spent to operate the OPS which is not in the same race with the housewife when it comes to doing the same job. She can do a far better job of policing prices than anybody else. She has backed away from buying potatoes at seed-potato prices and is substituting other things for potatoes. She has done it with meat in the past when it became too high, and there is nothing that will bring the

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