President Eisenhower's agriculture proposals, while they will probably be defeated by congressmen of both parties, are an encouraging sign of Administrative confidence in Secretary Benson.
Benson has fought to solve the farm surplus problem by long-term retirement of economically weak small farms. At the present time, under the acreage reserve clause of the soil bank program, such farms retire acreage one year, when market prices are low and support prices high; then produce at full capacity the next year when demand rises again.
Eisenhower's proposals would eliminate the one-year acreage reserve practice, and instead encourage the conservation reserve program, through which farmers are paid for taking land out of production for at least three years.
An equally effective brake on surplus farm production is the proposal to set the range of price supports at between 60 and 90 per cent of parity. With this weapon, plus elimination of "escalator" supports, Benson admittedly has the power to threaten economic ruin to large areas of agriculture. Yet Congressional charges that Benson wishes to become an agriculture "czar" confuse the threat with his long range goals. An anti-surplus program would eventually stabilize production and demand such that government support and control would be reduced, not increased.
Sentiment for the small farmer remains as a hangover in American politics. The depression, when agriculture and labor suffered from lack of purchasing power, made this affection a political weapon. Even in good times, farmers do not have the monopoly power other industries have. No one farmer or small group of farmers can increase demand for his product by cutting back production. When prices fall, the only course is to produce more--which causes prices to fall still further. Thus, artificial price supports are a necessary prop for a vital part of the economy.
On the other hand, growing technological improvement has created producing power in excess of demand. While price support has encouraged the highly efficient agricultural supplier, it has also kept large numbers of people "down on the farm" who would have been put to better use somewhere else in the economy. And their purchasing power would have been diverted as well. Thus, any discussion about "helping the farmer instead of eliminating him," to quote Senate Majority Leader Lyndon Johnson, should distinguish between farmers worth helping and those worth discouraging. The Eisenhower farm proposals can deal with both as painlessly as possible--and get rid of surpluses in the bargain.
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