vation, and protection of muck lands by windbreaks. In addition, the year's record included the construction of 355,000,000 linear feet of terraces; excavations of more than 11,146,000 cubic yards of material in the construction of many thousands of dams and reservoirs in the range country; construction of 4,082,000 linear feet of ditching; and 20,731,000 linear feet of contour ridging of pasture

land.

Another of the outstanding achievements in the soil-building part of the program was the use of 5,792,000 tons of limestone and 637,000 tons of superphosphate by cooperating farmers in carrying out approved practices.

In all, the program has an impressive record of soil-building accomplishments, touching every State and county.

PAYMENTS

Conservation payments compensated farmers to some extent for making their proportionate adjustments in the national effort to bring about a more balanced production of soil-depleting and soilconserving crops and helped them pay for needed soil-building practices. Along with these payments, price adjustment payments on wheat, corn, cotton, and rice helped bring the income from those crops nearer the parity level.

Conservation payments, including range conservation payments, in connection with the 1939 program totaled $497,311,000; price adjustment payments totaled $211.742.000. Thus, a combined total of $709,053,000 was added to the cash income of the Nation's farmers for their 1939 adjustment efforts. In qualifying for this cash aid, farmers also were storing in their soil the accruing benefits of a conservation system of farming.

2. INCOME PROTECTION

While acreage allotments and soil-building practices are designed to make farming safer and more profitable over a span of years, the A. A. A. also provides income-protection features that operate when conditions are unfavorable to farmers. These protective features are commodity loans and, in the case of wheat, crop insurance. Loans continued to play an important part in the program for the major commodities in 1939 by stabilizing prices and, where supplies remained excessive, by enabling farmers to hold their crops in storage and thus avoid disorderly marketing. The principal crops on which loans were made during the year were corn, wheat, cotton, peanuts, tobacco, and gum naval stores.

Crop insurance, applicable only to wheat, gave producers of that crop an opportunity to insure against unavoidable crop losses and guaranteed an income from at least 50 or 75 percent of the farm's normal wheat production. Approximately 166,000 policies covering 7,200,000 acres of wheat were issued under this program in 1939, and indemnities totaling about 10,000,000 bushels of wheat were paid to insured producers who suffered unavoidable losses.

3. MARKETING QUOTAS

Established only in years of unusually burdensome supplies, marketing quotas promote orderly marketing and assure a fair share of the market to those farmers who are making an effort to balance supplies with demand. To become effective, quotas must be approved by two-thirds of the eligible producers voting in a referendum.

Farmers made use of marketing quotas for cotton in 1939 but failed to give the required two-thirds majority for quotas on rice and three kinds of tobacco. Referendums were necessary for all of these crops because the supplies were above the quota levels established in the Agricultural Adjustment Act of 1938.

A total of 1,169,663 cotton producers voted in the referendum on cotton quotas, and 84.1 percent of the votes were favorable. In the case of flue-cured tobacco, the favorable vote was 56.8 percent; for Burley tobacco it was 59.4 percent; and for fire-cured and dark aircured tobacco, 60.4 percent. As these majorities were short of the required two-thirds, quotas were not effective.

The 1939 cotton crop was subject to marketing quotas, with marketings in excess of quotas subject to a penalty of 3 cents per pound.

4. EVER-NORMAL GRANARY

In a broad sense, the Ever-Normal Granary is a principle of agricultural planning that has to do with the building up and maintenance of abundant reserve supplies-reserves of surplus products in bins and warehouses, and reserves of fertility in the soil to guarantee abundant production in the future.

The A. A. A. program is focused directly on both phases of the plan. Payments, marketing quotas, and supporting loans aim at abundant but not burdensome reserve supplies-a storehouse of food and fiber that protects the Nation against scarcity on the one hand and protects the soil against exploitative use and rapid depletion on the other.

In 1939, marketing quotas for cotton and payments based on allotments played an important part in adjusting the supply of that crop and kept the surplus cotton from growing to an even more excessive level than it had reached. Storage loans on cotton, wheat, and corn held the reserves of those crops, which assumed impressive new importance in the light of national defense needs, in orderly storage and protected the income of the producers. In fact, all features of the A. A. A. farm program combined to give real and immediate value to the Ever-Normal Granary and to give farmers, and the people in towns and cities, the advantages of cooperative avoidance of wasteful overproduction.

5. THE SPECIAL PROGRAMS

To meet effectively the conditions peculiar to some of the subdivisions of agriculture, special programs were provided. These included the range conservation program, similar in operation to the agricultural conservation program and applicable to the range areas of the West and Southwest; the naval stores conservation program,

adapted to the needs of gum naval stores producers of the southern coastal areas; the program of the Insular Region, an adaptation of the agricultural conservation program to the islands and territories of the United States; the conservation materials and services program, under which special aid was extended to cooperating farmers in carrying out soil-building practices; and the sugar program, operating under separate legislation but administered in the field through the A. A. A. local committees. The range, naval stores, insular, and conservation materials and services programs are discussed in detail in chapter 4; the sugar program is discussed in detail in chapter 6.

Other special functions of the A. A. A. in 1939 included the activities of the Consumers' Counsel Division, representing consumers' interests in the planning and administration of the general program, and of the Division of Information, in charge of the national informational work of the agency. (See appendix C, p. 149.)

III. NATIONAL PARTICIPATION

The increased use of conservation materials in 1939, the rapid development of the Ever-Normal Granary principle of balanced agricultural production, and the successful operation of the various auxiliary features of the program, such as loans, crop insurance, the export program, and the food stamp plan, all offered evidence of increased participation.

Actually, a total of 5,756,240 farmers qualified for conservation payments as a result of their cooperation in the 1939 program. This was an increase of almost 10 percent over the number participating in the 1938 program and 58 percent over the number participating in 1937.

The cropland on participating farms in 1939 represented 78 percent of all cropland in the United States.

The fact that the average of all conservation payments was $86 indicated that the bulk of the program's benefits went to the smaller operators.

Altogether, 48,196 ranch operators in 17 western States received payments totaling $12,145,000 for participating in the 1939 range program. The payments covered conservation measures on a total of 213,378,795 acres of range land.

Participation continued to grow in 1940. Preliminary estimates indicate that more than 6 million farmers, a large majority of all the farmers in the Nation, will qualify for payments under the 1940 program.

IV. ADMINISTRATION OF THE PROGRAM

The local administration of the A. A. A. program, in its various phases, is in the hands of community, county, and State committees of farmers, who are assisted by regional representatives of the A. A. A. and by the Agricultural Extension Service.

All farmers taking part in the program are members of county agricultural conservation associations, and community committees are elected annually from and by the members of these associations in

each community. At the same time delegates to the county convention are chosen who, in turn, elect three farmers as members of the county committee. The county committee elects a secretary, who may be the county agent. In event the county agent is not selected, he is nevertheless an ex officio member of the committee. The county committee, in general, administers the local details of the program, with community committeemen assisting as they are needed.

In 1939 there were approximately 3,000 county committees in the United States. The committeemen were paid for their services on a per diem basis, and these and other administrative expenses of the county associations were prorated among all participating producers in the county as small deductions from conservation payments.

The State committees are composed of farmers, usually four in number (appointed by the Secretary of Agriculture), and the State director of the Agricultural Extension Service. The appointments are made on the recommendation of the Administrator, who generally consults with local farm leaders before making his recommendations. The State committees are in charge of the application of the program in the States.

The central administration in Washington is headed by the Administrator. Under his direction, the responsibility for carrying out the program in 1939 and for shaping A. A. A. policies, within the framework of the farm legislation, was held by six regional division directors, a director of information, and a consumers' counsel director. The regional directors were in charge of the program in five geographical divisions of the United States-Northeast, East Central, Southern, North Central, and Western-and in the Insular Region, which included Puerto Rico and the Territories of Alaska and Hawaii. In 1940 the administration of the program in the Insular Region became a part of the Division of Special Programs, and the Consumers' Counsel Division was placed under the Director of Marketing, Department of Agriculture. The Sugar Division was made a part of the A. A. A. as of February 1, 1940.

V. DEVELOPMENT OF THE 1940 PROGRAM

Past experience and the well-considered suggestions of farmers from all regions and localities were the basis on which the 1940 program was planned. In line with the practice of other years, a national conference of farmers and A. A. A. administrative officials from all 48 States was held in Washington in July 1939, and the final details of the new program, involving a few minor changes in response to the sentiment of farmers and field personnel, were evolved. In general, however, the 1940 program was substantially the same as that of 1939.

New provisions were included for the purpose of better adapting the program to local conditions, with special consideration being given to the small farmer.

The new provisions extended the features of the program regarding commercial peanuts and vegetables to more counties than were included in the area in 1939; encouraged further conservation measures on small farms by assuring at least a possible payment of $20 for all participating farms; provided soil-building practices to meet local

needs more adequately; encouraged wildlife conservation; and sought to promote the growing of home gardens in designated areas where food production on the farm was generally inadequate for home needs. As a means of encouraging the planting of forest trees on farms, the 1940 program included a provision enabling any farmer to earn as much as $30 by planting forest trees in addition to the regular farm payment for carrying out soil-building practices.

The 1940 program for wheat, corn, cotton, peanuts, potatoes, rice, tobacco, commercial vegetables, and general soil-depleting crops remained substantially the same as in 1939. National acreage goals for individual crops were as follows:

Provisions of the program applicable to restoration land were strengthened in order to encourage farmers to establish permanent vegetative cover on land which should not be cultivated.

The 1940 range program encouraged the establishment and improvement of permanent cover on range land, with greater emphasis than in 1939 on supplemental range conservation practices in connection with deferred grazing. To encourage improvement of small ranches, the 1940 program provided that every participating rancher would at least have an opportunity to earn an amount equivalent to 10 cents an acre, up to 640 acres, for carrying out range-building practices. The amount possible to be earned in most cases was of course more.

In general, the 1940 A. A. A. farm program was formulated with careful attention to the current European war situation and its possible effects on American agriculture. The broad aim was a continuation and further development of the conservation and adjustment measures provided for in the law and the maintenance of production that would balance with demand, whatever that demand might prove to be.