the property, equipment, and operations of one of the full-fashioned hosiery plants which was located on the Penderlea resettlement project in Pender County, N. C. The committee directs particular attention to the memorandum or report made by Mr. Furr and calls attention to his conclusions, as set forth in the memorandum submitted, as follows:

*

** proper investigations were not made, and proper studies were not made by people acquainted with southern help and southern conditions. * * In all of my experience in hosiery I have never seen a greater waste of money or a mill more badly managed, and cannot by the greatest stretch of imagination think of anyone who would be so careless in manufacturing if they were using their own money. Due to the type of management it, in my opinion, has been the most complete failure imaginable and is a definite reflection on what could be done with people in that or any other section of the State with proper guidance. Certainly Congress has not knowingly authorized the Farm Security Administration or any other agency of the Federal Government to engage in the business of manufacturing full-fashioned hosiery, or authorized the operation of the other industrial plants and enterprises which have been and are being financed and operated by the Farm Security Administration through corporations, the charters of which its officers sought and obtained.

By reference to pertinent Executive orders, it will be observed that subsistence homesteads and some of the industrial plants have been transferred from the Farm Security Administration to the National Housing Agency. In connection with some of the subsistence homestead projects and industrial enterprises the Farm Security Administration built, equipped, and financed a hotel or inn, dairy farm, stores, service stations, and other commercial establishments, together with recreational facilities and community buildings, and otherwise provided for the health, happiness, and welfare of the families living on such projects.

This committee recommends that legislation be adopted providing for the retransfer of such subsistence homestead projects and industrial plants to the Farmers' Home Corporation for immediate and orderly liquidation, to the end that the Government may recover as much as possible of its investment and surrender control of its responsibility for the further maintenance and operation of such industrial enterprises. The investigation of the committee, through its special investigator and otherwise, substantiates the findings and conclusions of Mr. S. C. Furr, as heretofore referred to. All of such projects were ill-advised, poorly operated, and have resulted in great financial losses to the Government. The name and full information concerning each of such projects will be found in volume III of the transcript of the hearings.

LOANS BY FARM SECURITY ADMINISTRATION TO OTHER COOPERATIVE ASSOCIATIONS

Exclusive of the so-called relocation corporations which were organized by Farm Security Administration, which had no authority to purchase land, and cooperatives organized and financed under the provisions of the Water Facilities Act, Farm Security Administration has loaned $25,740,771 to cooperative associations. Of these loans, $4,954,190 were transferred to the Federal Public Housing Authority, apparently under the authority of Executive Order 9070, dated February 24, 1942. Of the cases transferred, only $146,035, or

approximately 3 percent, had been repaid up to September 30, 1943, the date of the transfer. Repayments on the remaining $20,786,581 of cooperative loans had been $2,749,438 up to December 31, 1943, or 13 percent of the loans. This figure is said to represent 84 percent of the maturities, but it should be considered in the light of the liberal renewal and extension policy of Farm Security Administration.

LABOR CAMPS

The committee visited several labor camps and discussed the operations of such camps with agents of the Farm Security Administration and with occupants of the camps.

In some of the camps migratory laborers are housed in very comfortable homes and have the benefit of all modern conveniences and facilities, including hospitalization and medical and dental care, all of which are furnished at a very nominal cost. Many such laborers who are thus housed and provided for at the expense of the Government are earning high wages and should no longer be cared for and maintained at the expense of the Government. In other labor camps the houses, shelters, or tents provided are neither fit nor suitable for human habitation and constitute a menace to the health and social welfare of the families residing therein. Entire families occupy one room, shelter, or tent which is used as a combination kitchen, dining room, and living quarters. The space provided does not permit desired privacy and must, of necessity, result in many embarrassing situations. Some of the shelters or camp houses are built of wood, others entirely of galvanized tin, and others of cloth

or canvas.

In some of the labor camps the occupants are not even required to clean the premises immediately adjacent to the structures which they occupy as homes. When it is necessary to clean the premises upon which such labor camps are located, laborers other than those occupying the property are employed for that purpose. If services of any kind are rendered by the occupants or laborers living upon such premises, such laborers are paid prevailing wages in the community in which the camp is located.

In addition to caring for migratory farm laborers in the several States and localities, laborers and their families are transported great distances at Government expense. For instance, laborers and their families were transported from the State of Mississippi to the city of Portland, Oreg., and the Farm Security Administration provided all traveling expenses to and from the city of Portland, and in addition thereto provided such medical care and attention as might be necessary. Other laborers were transported to the city of Portland from a distance of as far as 800 miles south of Mexico City, all of which was at the expense of the Government. If, after reaching their destination laborers become dissatisfied or are unwilling to work and to carry out their part of the contract, the Government defrays the expenses and immediately arranges for their return home.

The committee does not believe that in normal times the migration of labor should be either encouraged or sponsored by the Federal Government, nor does it believe that the Government should defray

the expenses incident to the maintenance of such camps or shelters, or traveling expenses to and from the same.

All labor camps which were formerly administered by the Farm Security Administration have been transferred to the Office of Labor under the War Food Administrator. The committee recommends in the basic legislation, which is submitted as a part of this report, that all such labor camps as are now being administered by the Office of War Food Administrator shall, upon the termination of the present emergency, be transferred to the Farmers' Home Corporation for the purpose of liquidation, as provided in H. R. 4384.

LIQUIDATION OF PROJECTS

Contrary to congressional action taken as far back as 1937, to bring about liquidation of these projects, which would include not only farming projects, but also industrial projects and labor camps, Farm Security Administration continued its program of expansion instead of selling the nonfarming projects and subdividing the farming projects into family sized units and selling such units to worthy tenants as contemplated under the tenant-purchase program contained in the Bankhead-Jones Farm Tenant Act. Not until early in this fiscal year does it appear that any active steps were taken to terminate the Government's interest in such projects without substantial further development. In fact, very little was done toward liquidation of these projects on a sensible basis, as directed by the subcommittee of the House Committee on Appropriations and by the Congress, until the appointment of the present Administrator of Farm Security Administration.

NINETY-NINE YEAR LEASES

The policy of governmental subleasing was apparently likewise initiated upon an experimental basis and in accordance with the recommendations of the President's Special Committee on Farm Tenancy. The committee does not feel that it is necessary to discuss the virtues or merits of the fee-simple ownership of property as compared with the policy of 99-year leases and collective farming enterprises, further than to observe that the courts of all American jurisdictions look with favor upon the vesting of fee-simple title and the experiments referred to are incompatible with the land policies which Americans have cherished throughout the years. The idea of home ownership could not have entered into the deliberations of those responsible for such a policy as that which resulted in an expansion of resettlement projects, in collective farming projects, and the leasing of real property for a term of 99 years.

The associations through which most of the 99-year-lease procedure was utilized operated collective farms along communistic lines, under which the individual would never own the land he farmed or even the home in which he resided. He would have a stock or membership interest in the association; be paid a wage of, for instance, 50 cents an hour, for work on the project; would receive certain supplies, such as meat, corn for meal and feed for chickens, wheat for flour, and the use of a milk cow; and would be allowed to occupy a residence and utilize a small tract of land for a garden, under a license terminable by the

so-called cooperative on short notice, with the right in the cooperative to have its representatives enter and inspect the premises at any time. At the end of the year, if profits had been realized by the association, the member would receive a pro rata share of those profits. Most, if not all, of the projects had large community houses for recreational and community activities, and establishments shared by the project members in common, such as stores, repair shops, grist mills, etc. In the circumstances mentioned above, the ultimate goal of home ownership is not even remotely contemplated.

TENANT PURCHASE PROGRAM

The traditional American system of independent, family-type farms, owned and operated by individuals who enjoyed the pride of ownership, was threatened by the highest tenancy ratio in the history of our Nation at the time Congress enacted the Bankhead-Jones Farm Tenant Act, authorizing loans to worthy farm tenants on long terms and at low interest rates. This act has proven to be one of the most farsighted legislative steps ever taken to aid worthy small farmers of this country. According to the 1940 census, there was an adult male farm popualtion in the United States of 9,288,000, of which 3,736,000 or 40.2 percent were landowners and 5,552,000 or 59.8 percent were nonlandowners. Of the nonlandowners, 2,361,000 were tenants and 3,191,000 were farm laborers. Approximately 2,000,000 of the 6,097,000 farms in the United States produced less than $400 gross a year and an average of only $215, a sum quite insufficient for the maintenance of a family. The number of family-type farms had greatly decreased, while farms of 1,000 acres or more in size had increased from 28 percent to 34.3 percent between 1930 and 1940.

The investigation discloses that the tenant purchase program as such has been operating efficiently and has resulted in many worthy citizens being placed definitely on the road to farm-home ownership. One hundred ninety-one million four hundred eighty-seven thousand seven hundred and forty-nine dollars had been loaned to 33,559 tenant purchase borrowers through June 30, 1943, and $18,500,605, said to represent 98 percent of maturities, had been repaid. Payments have been made in excess of maturities. The purchases of farms have been financed upon a fair and reasonable basis. Through this program the values of all farms are certified by local committees familiar with local land values, and each family assisted is likewise carefully considered by the local committee. This committee must first investigate the applicant as to his character, ability, and experience and must find that the applicant may be expected to carry out successfully undertakings required of him in connection with the tenant purchase loan applied for. When an applicant is approved for a tenant purchase loan he obtains a fee simple deed from the grantor from whom he is purchasing the property and executes a deed of trust upon the property securing the loan which is obtained from the Farm Security Administration.

The tenant-purchase program, operating as it has, through local committees of farmers, has been successful and should be continued and expanded in the interest of worthy citizens who cannot otherwise arrange to finance the purchase of family-size farm units and who without such assistance may never become home owners.

REGIONAL OFFICES

During the course of the investigation, it became clearly evident to the committee that Farm Security Administration had been extravagant in the establishment of the offices and use of personnel. This has been particularly true with respect to its regional offices which, to a large extent, duplicate functions which could properly be served by the State offices. This point has been discussed with employees and agents of the Farm Security Administration and they have frankly admitted that there was no justification for maintaining certain offices which were then fully staffed and equipped. Other agents and representatives of the Farm Security Administration frankly admitted to the committee that their duties could be absorbed by other employees and that neither the Government nor the individuals involved would in any manner suffer or sustain losses by reason of the changes.

The Farm Security Administration has, perhaps more than any other Government agency, delegated authority down to the local Farm Security Administration supervisors to approve the loans and to direct the agency's activities in each county. There is no apparent reason why the functions of supervising and directing the activities of these county representatives cannot run directly from the Washington headquarters to the States and then to the counties. The regional office set-up which requires State supervisors in any event, and which involves extensive travel from States to the regional offices, rental costs, office equipment, and the usual complement of administrative and clerical personnel, is really nothing more than an unnecessary superstructure over the people in the States. It has become increasingly apparent to the committee that this regional_superstructure can be eliminated with substantial savings to the Government and a more efficient line of services directly from the national headquarters to the States. It is appreciated, however, that in the case of States having unusually low volumes of loans to low-income farmers, it may be advantageous for one supervisory office to serve more than one State.

IMPROVEMENTS IN FARM SECURITY ADMINISTRATION

The committee has conferred with the War Food Administrator from time to time concerning both policy and personnel and, as a result of such conferences, the policies and personnel of the Farm Security Administration have been substantially changed. A short while ago a new Administrator was appointed and he has made further substantial and worth-while changes in both policies and personnel, and the committee believes that he has diligently and faithfully sought to accomplish the will of Congress, and in the performance of his duties has prosecuted an orderly program of liquidation, in keeping with congressional mandates which have been given, and has provided further safeguards for all programs which have been entrusted to him.

Among other things, the new Administrator of Farm Security Administration has streamlined its functions in many respects, greatly reduced the number of personnel and has made substantial savings in