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No. 33 "Regimenting the Farmers" Speech of Dr. G.W. Dyer, Professor of Economics, Vanderbilt University, May 5, 1935. American Liberty League. 400dpi TIFF G4 page images Digital Library Services, University of Kentucky Libraries Lexington, Kentucky Am_Lib_Leag_33 These pages may freely searched and displayed. Permission must be received for subsequent distribution in print or electronically. No. 33 "Regimenting the Farmers" Speech of Dr. G.W. Dyer, Professor of Economics, Vanderbilt University, May 5, 1935. American Liberty League. American Liberty League. Washington, D.C. 1935. This electronic text file was created by Optical Character Recognition (OCR). No corrections have been made to the OCR-ed text and no editing has been done to the content of the original document. Encoding has been done through an automated process using the recommendations for Level 1 of the TEI in Libraries Guidelines. Digital page images are linked to the text file. Pamphlets Available Copies of the following pamphlets may be obtained upon application to the League's national headquarters: Why, The American Liberty League? Statement of Principles and Purposes American Liberty League Its Platform An Analysis of the President's Budget Message N. R. A. Its Past, and Recommendations for the Future Analysis of the $4,880,000,000 Emergency Relief Appropriation Act. Economic Security A Study of Proposed Legislation The Bonus An Analysis of Legislative Proposals Inflation Possibilities Involved in Existing and Proposed Legislation The Thirty Honr Week Dangers Inherent in Proposed Legislation The Pending Banking Bill A Proposal to Subject the Nation's Monetary Structure to the Exigencies of Politics The Holding Company Bill An Analysis of Proposed Legislation "What is the Constitution Between Friends?** Speech by James M. Beck Where Are We Going? Speech by James W. Wadsworth Price Control An Analysis of Experiments and Recommendations for the Future Yesterday, Today and Tomorrow A Review of Factual Analyses issued by the American Lib- erty League and a discussion of the Legislative Situation. The Labor Relations Bill An Analysis of an Undesirable Measure Government by Experiment Speech by Dr. Neil Car others How Inflation Affects the Average Family Speech by Dr. Ray Bert Westerfield The AAA Amendments A Study of Proposals Illustrating a Trend Toward Fascist Control of Agriculture and other Industries Political Banking Speech by Dr. Walter E. Spahr The Bituminous Coal Bill An Analysis of a Proposed Step Toward Socialization of In-dustry AMERICAN LIBERTY LEAGUE NATIONAL PRESS BUILDING WASHINGTON, D. C. â˜… Regimenting the Farmers" â˜… â˜… â˜… Speech of DR. G. W. DYER, Professor of Economics, Vanderbilt University, over the Network of the Columbia Broadcasting System, May 5, 1935 AMERICAN LIBERTY LEAGUE National Headquarters NATIONAL PRESS BUILDING WASHINGTON, D. C. Document No. 33 "Regimenting the Farmers" â˜… Depressions of necessity create conditions that are favorable to economic and political quackery. Sane recovery from the shock of a depression is always slow. It is the slowness of sound recovery measures that gives the opportunity to the quack to come in with his radical remedies and cure everything in a "jiffy." In order to impress the weak minded with his marvelous healing power, the quack always makes a large use of stimulants and narcotics. In all other depressions the sane leaders were able to protect the industrial order against quack economic principles, and permit the natural constructive laws of recovery to function. The result in every case was complete recovery after a few years of readjusting. This is the first time in our history that extreme radicalism has attained a position of leadership in the Nation. It is no reflection on the character of a man to call him a quack. A quack may be a good man, and may mean well. Quackery is a defect in the brain, not in the heart. Quackery is an unscientific, illogical course of conduct based on superficial knowledge and positive ignorance. The ignorant man who knows he is ignorant may be a very good citizen. But the ignorant man who is under a delusion that he is a Solomon is always dangerous. No other type of boldness is so destructive as the boldness of ignorance. When the depression came in '29, the prices of farm products, like the prices of everything else under natural laws, fell to a very low point. This always happens in a depression. As a result of this temporary crisis, many farmers, like men in every other field of business activity, were unable to meet their obligations. Many farmers had bought farms and were in process of paying for them. Many other farmers had borrowed money under mortgages. But this condition of the farmer was not unlike the conditions of other groups. As a matter of fact, it is highly probable that no other large group of 3 men in business, when the depression came, were so free from debt as Southern farmers and no other group of men were more able to take care of themselves without charity from the Government. There were 1,112,834 farms in the Southern States in 1930 that were operated by full owners. Of this number only 328,773 were mortgaged. In the Southern States 784,773 farms were absolutely free of mortgage in 1930. Less than 28 per cent of the farms operated by full owners in the Southern States carry any mortgage at all. Over 78 per cent of the farms of Virginia operated by owners are free of mortgage. The total farm mortgage indebtedness of all the Southern States is only about one-third the indebtedness of New York City. The debt of the City of Detroit is greater by ten millions of dollars than the combined farm mortgage indebtedness of Virginia, West Virginia, North Carolina, South Carolina, Georgia, Florida, Alabama, Mississippi, Arkansas and Louisiana. More than 60 per cent of the farms of the Nation operated by owners are free of mortgages. The total amount of farm mortgage indebtedness on all the farms of the whole country operated by owners is only about one-third the bonded indebtedness of the railroads. The farm mortgage prob-Prosperity km is really not a serious and Farm problem in the Southern Mortgages States. The State that really has a serious farm mortgage problem is Iowa, the home of the Secretary of Agriculture. The farm mortgage indebtedness of Iowa is greater than that of all the Southern States combined, with Texas excluded. In the State of Iowa, where Mr. Wallace has been a conspicuous leader in agricultural policies, farm mortgage indebtedness increased over $285,000,000 between 1910 and 1920. This was an increase of 132 per cent. Yet this was the period of great agricultural prosperity. It is in this period that Mr. Wallace gets his standard of real agricultural prosperity. The farm mortgage problem is not the result of low prices and hard times on the farm. It is the result of wild speculation on the part of farmers in the period of inflated agricultural prosperity. The total farm mortgage indebtedness in 1910 on farms operated by owners for the whole Nation was only $1,727,172,851. In 1920 the mortgage indebtedness had jumped to $4,003,767,192. As a matter of fact, in times of inflated prosperity farmers lose their heads and engage in wild speculation just like other groups in the cities. But when they are brought face to face with the results of their mistakes, superficial leaders and radicals tell them their trouble is the result of unwarranted discrimination against the poor farmer by powerful groups in the big cities. They explain their troubles as a boa constrictor explained his predicament on one occasion. The boa constrictor was crawling through a field and was approaching a rail fence. He was anxious to get through the fence and there was one space between the rails just large enough for him to squeeze through. But just before he got to the fence a rabbit jumped up within his range and he was so fond of rabbits he just had to swallow them when they came within his reach. He swallowed the rabbit and started through the fence. But when he got down to the rabbit he had to stop; the rabbit was too big for the hole. While he was trying to get through, another rabbit came in his range and he swallowed this rabbit also. Then he had a rabbit on each side of the fence. The result was that he could neither move forward nor backward. In explaining his predicament he reasoned as many so-called farm leaders reason today, he said he was a victim of unfortunate conditions over which he had no control. Hence he proceeded to repudiate the Constitution and declare war on the whole system of American freedom. The unusual conditions Conditions created by the present Favor the depression made it easy Quacks for radicals, quacks and superficial ignorant reformers to capitalize the supposed hopeless farm mortgage indebtedness. The theory was broadcast throughout the Nation that the farmer was in a desperate, helpless, hopeless condition, that this condition was brought about by conditions beyond the farmer's control. As a result of the brilliant analysis of the situation, the conclusion was reached that the American system of freedom in agriculture had proven a miserable failure and must be repudiated, that the farmers of the Nation must be regimented and placed under centralized control from Washington with Mr. Wallace from Iowa as dictator. As a result Congress at once repudiated constitutional freedom for the farmers and gave the dictator full power and authority to regiment American farmers and direct their lives and activities as he pleased. At once Mr. Wallace called on American farmers to repudiate constitutional freedom, to repudiate the theory of Jefferson that the pursuit of happiness is a valuable right of the individuals, and hence take orders from him in pursuing their activities as farmers. He made it plain that the farmer must henceforth get permission from him to plant his crop, and must plant and cultivate and destroy or market under his direction. Moved by the hope of reward and the fear of punishment, the farmers rushed in, surrendered their freedom and pledged themselves to obey every order of their new master. The dictator made it clear to all farmers from the beginning that he would permit no sort of freedom to the individual farmer to do anything that might be in conflict with his orders. He also made it clear that he would practically destroy the crops, through taxation, of any farmer who should have the presumption to disobey his orders. But to all good servants who would obey his will and carry out his orders without question, he graciously promised to reward them from a large fund raised by a processing tax on consumers. Since the doors to freedom were closed by the dictator, the average farmer felt that he had no option, that he must join the regiment and be good. 6 The dictator went back The Plan to the period of 1909- of the 1914 to get what he Dictator called the base period for prices of agricultural products. He decided that this basis was all right for everything except tobacco. He selected the period 1919-1929 for tobacco. He might have selected any other period or no period at all He had the power to fix arbitrarily the price base any where he pleased. Dictators are not bound by any rules save those they fix for themselves, and these are mere scraps of paper. After fixing high arbitrary prosperity prices for farm products, he issued an order to his vassals to cut down the production of farm commodities to the point that would force prices on account of scarcity to the high prosperity level. His orders were to keep food and clothing scarce and keep the prices high regardless' of the poverty of the consumers, regardless of unemployment, regardless of human suffering, regardless of everything. His orders were to hold these high artificial monopoly prices at the points arbitrarily fixed by the dictator and "starve" the consumers into paying the prices demanded. Soon after this edict came from the small echo of Stalin, news came to him that the great cotton fields of the South, almost white unto harvest, gave promise of a great cotton crop. This was bad news to the dictator. He tore his hair and resented the affront of nature in presuming to interfere with his plan of withholding food and clothing from the poor, and ordered his vassals to destroy more than a million acres of these beautiful plants, the gift of God to the poor, that were guilty only of the offense of seeking to clothe the naked and feed the hungry. Then news came from his Nature provinces that the supply and the of hogs was large and Dictator that this indicated that the prices of bacon and fresh pork and hams would be within the reach of the poor, that every family might have bacon 7 for breakfast and a roast of pork on Sunday. This news aroused the anger of the dictator in a most unusual way. Nature had taken up arms against him again in the interest of the millions of the poor. In order to crush nature's forces once for all he gave orders to murder five million hogs and destroy the meat, and warned his vassals not to let nature start anything like that again. His orders were not to permit any human being to get one single ounce of the meat from these hogs for food. It was all right to feed it to rats and wild cats and worms, but it must be denied to any human being whatever his state of need and poverty. The dictator was victorious in his battle with nature. The 5,000,000 hogs were murdered and destroyed, and only the rich and government employees and others of good incomes can afford to buy breakfast bacon at thirty-five and forty cents a pound. In order to facilitate the Effects regimenting of farmers in Upon the organizing the greatest Consumer monopoly of food prod- ucts of all time, the dictator invented what he calls the processing tax. In order to understand the nature and purpose of the processing tax, we may listen to a conversation between a clerk in a chain store and a poor woman customer. Customer: "I want a four-pound pork roast. What is the price?" Clerk: "Fifteen cents a pound." Customer: "I paid only 12% cents a pound last week." Clerk: "But that was before the processing tax went into effect. The Government collects practically 2% cents on every pound of pork now as a processing tax, and you must pay the tax." Customer: "What is the processing tax?" Clerk: "The Secretary of Agriculture thinks pork and practically all farm products are far too cheap. He thinks that you ought to pay a whole lot more for your food and clothing than you are now paying. The purpose of this processing tax that you are required to pay is to raise a huge fund to be used in rewarding farmers for destroying food and clothing materials in order that food and clothing may become scarce and sell at high prices." Customer: "This all sounds funny to me, but I suppose it is all right. Just give me three pounds. I can't afford to buy four pounds at the higher price. We will eat less." Customer: (A month later) "Well, has pork come down any?" Clerk: "Come down, I should say not! You know, the Government took the processing tax you have been paying, and paid it to the hog raisers to destroy 5,000,000 hogs. The result of the destruction of so much meat that your money accomplished in the hands of the 'Hog Dictator' was to raise the price of pork from 12% cents to 25 cents a pound. Your processing tax brought about an advance of 100 per cent in the price of pork. It is wonderful, isn't it?" Customer: "Well, we can't afford to eat pork at that price. I suppose we will have to give up meat and live on turnips and onions." Clerk: "But the processing tax will perhaps go on turnips and onions soon." Customer: "Do you mean to tell me that a civilized Government has adopted the policy of taxing millions of poor consumers in order to raise a fund to pay the expenses of destroying food and clothing material so that the consumers may be forced to pay more for their food and clothing?" Clerk: "No, I didn't say that a civilized Government would do this or anything like it. I simply say that this is what your Government is doing." Under the processing tax the poor consumers are required to buy the material and build the scaffold on which they are to be executed. Social justice! The theory that the pro-Quack cessing tax, with all that Theories goes with it, is in the in- ane! Facts terest of the welfare of the people who live in rural sections, like other quack theories, is not supported by the facts. Over 53 million of our population are recorded as rural. There are less than six million farmers and farm tenants. A very large proportion of those recorded as farmers get nothing from the processing tax. A large proportion of the tenant farmers receive no part of the processing tax. The great majority of the people in the rural sections are not farmers. Again the 53 million people living in the rural sections including the farmers themselves are the really big buyers of farm products. Cotton farmers don't spin and weave the cloth they use. Wheat farmers don't grind their wheat. Only a small portion of farmers raise their own meat. The 53 million people in the rural sections constitute the really big buyers of pork. On account of a lack of refrigeration they are compelled to use cured hog meat. They are also the big consumers of flour and corn and cotton goods. Nearly all that the two and a half million farm hands make, they pay for pork and flour and meal and cotton fabrics. Hence they are the really big taxpayers under the processing tax. In many cases the very poor man pays more in dollars and cents under the processing tax than the rich man. The high artificial prices fixed and maintained regardless of demand and supply and regardless of human needs throughout the world, of course, will drive American farmers out of the world markets. Europeans and Asiatics are rapidly taking the place we formerly held and might continue to hold, of feeding and clothing the world. This means that millions will be thrown out of employment in the rural sections. This will mean a reduction in the value of agricultural land. The high cost the processing tax forces on the manufacturer of farm products is forcing these manufacturers out of the foreign markets. They can't compete, under such costs of production, with Japanese and European competitors. This is already forcing textile mills to close and adding large numbers to the unemployment rolls. The high prices forced on manufacturers will 10 more and more reduce the demand for then-goods and this will cause still more unemployment. When the millions of consumers really understand the nature of what seems to be the most outrageous and inexcusable social injustice ever imposed by any government on the poor, we may look for a popular protest from the rank and file of the voters that will sweep away every vestige of protection for American farmers, open this country to the markets of the world and leave the American farmer stranded as the victim of his own stupid folly. The Little Dictator is not More satisfied with the power Power that has been given him. Sought He wants more power. Dictators always want more power. He has succeeded in regimenting the farmer. Now he is asking Congress to give him the power to regiment and bring under his control and direction the manufacturers of farm products. Under the powers he is seeking from Congress, he could take over the virtual management of industries engaged in canning, milling, brewing, distilling, meat packing, textile manufacturing, cotton seed crushing, soap making and the manufacture of sugar, feeds, tobacco products, various foods, fertilizer and automobile tires. Commission houses, distributors and retailers handling farm products would also come under his control. With such power the Little Dictator could become a real Stalin. In view of the facts that are open to all, if Congress should grant him this additional power or should permit him to exercise further the power he has, it should at once resign and give place to representatives of the people who have the brains to discriminate between sound governmental and business principles, and economic and political quackery. 11