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Susan Green

Dems Push Brannan Farm Program

Worried About Horrible Prospect
of Farm Surplus and Vote Shortage

(13 June 1949)

From Labor Action, Vol. 13 No. 24, 13 June 1949, p. 1 & 4.
Transcribed & marked up by Einde O’ Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

Many weeks ago the Truman administration submitted to Congress a new farm bill named for Secretary of Agriculture Brannan. After some hearings and some publicity in the press and on the air, both for and against, the bill was tucked away in a cubbyhole. Administration leaders are now going to try to pry it out of hiding.

The starting point will be a Midwestern Democratic Conference to be held at Des Moines, June 12 and 13, at which four cabinet members and other moguls of the Democratic Party, including the Democratic governors of eight Midwestern states, will boost the Brannan bill. So it will be much in the news. Let us see what all the shouting is going to be about.

In the first place, this bill, like all other farm acts of recent vintage, starts from the premise that the whole agricultural sector of American economy has failed as private enterprise in a private-enterprise system. Of course, the politicians and lawmakers do not put it this way. They have gone ahead and provided government subsidies, government price support, government buying of surpluses, government plow-under programs, government regulation of planting, etc.

All of this is made necessary by the fact that the capitalist profit system does not allow the working people a share in the national income large enough to permit them to purchase the quantities of goods and foods that modern manufacture and agriculture can produce and must continue to produce.

The new Brannan bill is occasioned by the fact that the current parity-price-support farm law is causing the administration a very bad headache. The present law makes it incumbent upon the government to buy up farm surpluses or to take them up on loans, the price to the government or the extent of the loan being 90 per cent of what is called parity. Parity under the law is supposed to give a farm commodity the same exchange value, or purchasing power, in terms of things farmers have to buy, as that commodity had in the 1909–14 period.

During the war and in the post-war period this system worked out fairly well for the simple reason that prices were high and there were no distressing surpluses, except for potatoes and a few others of the less important farm products. But with the present sag in demand and with a deflationary pressure on prices, the situation has changed. Already the government is head-over-heels in farm surpluses and bids fair to be completely overwhelmed by them.

Surplus Headache

At the beginning of 1949 the stocks owned by the Commodity Credit Corporation (the government agency involved) or pledged to it under loan included 156 million bushels of corn; 284 bushels of wheat; 4,275.000 bales of cotton; 28 million pounds of eggs; 103 million pounds of wool – to name only a few items. The grand total, at the beginning of 1949, of stored commodities was valued at $2,186 million.

These huge quantities of farm products are kept from human consumption, but not because people are glutted with food and are overclothed. Indeed we all know about the millions who lack adequate food and clothing abroad and in this country too. But their need is not backed up by purchasing power.

So $50 million worth of eggs remain in government storage. Potatoes are bought by the government and plowed under. Wheat and corn are converted to pep up gasoline to burn in motors instead of in human stomachs, as Secretary Brannan pointed out.

To Maintain Farm Income

But this situation is mild compared to what is expected. With farming reviving in Europe and other parts of the world, and with unemployment steadily mounting in this country, the farm surpluses will grow and the threat to farm prices will be indeed serious. If the present farm support system remains in effect and the government must take up farm surpluses, it is expected that next year the government “investment” in this field will climb to $4 billion.

Obviously this is an unhealthy and an untenable situation. The problem of storage is the least of the problems, though it exists. Also no government wants voluntarily to throw so much good money after bad, as the saying goes; the government does worry about taxes – where its money comes from. And further, fundamentally it is impossible to maintain high farm-price levels with such surpluses on hand and with a general deflationary tendency. The Brannan bill embodies what the administration believes is a way out.

The basic change it seeks to make is this: Instead of parity (that is, the relation between farm prices and industrial prices) being the pivot of government support, farm income will be the determinant. The objective will be to prevent total farm income from dropping below a certain level. The average for the ten years 1939 to 1949 will be that level, or around $26 billion per year.

With the objective of keeping total farm income at this figure, the prices of some farm commodities will be supported and the prices of others will be allowed to seek their market level. In the former category will be more stable and storable products such as corn, wheat, cotton; in the latter category will be perishable products such as milk, eggs, meat, poultry. As an instance Secretary Brannan states that milk to the consumer might be allowed to go to fifteen cents a quart. The farmer would be entitled to a certain income on a stated amount of production, and the government would make up with a Treasury check the difference between that certain figure and his actual income at market and/or supported prices.

Big Farmers Against

To get this government subsidy, farmers would have to meet specified requirements as to soil conservation, possibly acreage allotments, marketing agreements and marketing quotas. While members of Congress and big corporation farms are objecting to government regulation as “socialistic,” most medium and small farmers do not oppose government controls in exchange for a guaranteed income. They fear the glutted markets and the decline of prices much more than government controls.

The Brannan bill ingratiates itself with the medium and small farmer because it attempts to remove the complaint against all former farm-support laws that they benefit the big corporation farm more than the family farm. Under the Brannan bill all farmers would get an assured amount of income on a fixed amount of their production, and this top amount of support production would be the same for both a big farm and a small farm.

This would work out so that all or most of the output of a family farm would have the benefit of income support. This is in line with some of the “Fair Deal” ideas of the administration for maintaining mass purchasing power, not very palatable to the big farm corporations and their representatives in Washington.

The supporters of the Brannan bill claim it will have some very definite advantages over the present parity-price-support system. They admit that that cost to the government will still be great, but promise it will not be as great as under the present method. They predict that by allowing many commodities to seek their market price level, the consumers will get a break, there will be higher consumption, less produce to store. This increased consumption of certain commodities due to decreased prices is expected to add up to more farm income, and therefore smaller checks from the Treasury will be called for to make up the guaranteed income.

Vote-Getting at Stake

The administration, worried over surpluses, claims that the Aiken farm law, which was passed by the 80th Congress and which goes into effect in January 1950, does not have the power to bring production down. Even though the Aiken law does provide for variations downward below 90 per cent of parity for government support of prices, farmers still consider this support more profitable than reducing production. This has been borne out in potato production where there are heavy surpluses in spite of the drop in price support from 90 per cent to 60 per cent of parity. The Brannan bill, on the other hand, provides for a guaranteed income on a definite amount of production and also for government regulations to check production. This, by the way, is scarcity production!

A final word about the motivation of the Brannan bill. Next year is an election year. If the Aiken law goes into effect, not only will the overall farm situation be bad, as pointed out above, and individual farmers will be insecure in the general insecurity, but they will also be dissatisfied with the fluctuations inherent in the Aiken law. Farmers would be likely to blame the administration for their troubles, in spite of the fact that the Aiken law was the creation of the 80th Congress. The Brannan bill, on the other hand, by guaranteeing income and purchasing power to the farming population, would reward the Democrats on election day.

Whatever the fate of the Brannan bill – it has powerful opponents – it is only another makeshift. As stated above, the government has to intervene permanently in that sector of the economy where the contradictions of the profit system have become an unrelieved problem. Will the government be able to maintain farm income, as provided by the Brannan bill; during a period of declining consumer income due to unemployment and declining national income due to minor or major crisis, without creating other baffling problems?

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