NFO-15 (AV10424): Midwest Farm Report: In Michigan

Good afternoon and welcome to the Midwest farm report, your host today is Jake Jacobson. Well good afternoon, we have a couple of first today in fact three first today in the Midwest farm report. First of all I'm here and though I dabble in farm information and farm news now and then I still have an awful lot to learn about farming and I hope to do some of that today and another big first on the program is the gentleman here to my immediate left and that's Stanley Van Vleet who is the chairman of the TV committee and old Stan just stands back there and watches everybody else get out here and suffer so you're gonna do a little suffering today yourself Stan and then down there on the far left and the far right of your screen is Ron Irwin from Isabella County he's the vice chairman of the national farmers organization over there and Ron it's nice to have you on the program with us today you're not nervous to die and to know like an old pro stanza guy here that's a little shook up right off the bat here he doesn't know what to do with his hands there for a while but I think he'll have plenty to say here in a few minutes and then the gentleman in middle is Don Trost he's just a national organizational director of the national farm organization. Well gentlemen were here and I have some questions that I would like to ask first of all like I have said before at the beginning of the program I've dabbled in farm news and a little farming when I was a younger boy but nothing to the capacity the two gentlemen go at it then some of the big things that I had been learning about this is that farmers are businessmen and pretty big businessmen why what the question I want to say right off the bat if they're such big businessmen now how come you don't make any money? Well Jake, I can probably try and give an answer to that question we are as you say big businessmen we have it's not uncommon today to find a farmer with a hundred hundred and fifty thousand dollars invested in his farming operation, we can't say we aren't making any money but we don't feel we're getting fairly compensated for the investment and the work that we put into our farming operation I think your question was the reason for this we feel it's because the farmers while they've been producing more every year producing and producing and producing we've done nothing about the marketing of our commodities we've let someone else tell us what price were going to have for our commodity and we feel it should be the farmer that puts a price on his product. Don you had some pretty revealing statistics there and sort of socked me right in the nose made me sit back and take notice and that is the comparison between the farm worker and the non farm worker, the amount of work that they have achieved and the payments could you sort of tell the folks about that? Well yes, now these figures I've got it from the Congressional Record so they were given by Senator Proxmire about a year ago so I assume they're accurate and he said that in over the last 10 year period the output per worker on the farm has doubled while the income has been cut in half in this same 10 year period the output per worker in non-farm income has increased 25 percent while the income for non farm worker has doubled, in other words farmers are working twice as hard for half as much while people in non-farm occupations have just increased 1/4 and they're receiving twice as much as they did 10 years ago. I think Stan is going to work over here already he's got one of his charts out can I help you out with a the stand and you can move in and do a little talking about that? hold on here just a minute saying we're coming in with our camera here and there Ola get in there you can go right ahead now. I think the difference take his organization and collective bargaining as we try to illustrate on the the graph they are the earnings and food marketing, how they have increased since 1947 and how the hourly returns all farm labor management mm-hmm they remained almost the same back to very little difference from 47 through 63. I see now in food marketing it's gone now they about 1947 they are both about the same or looks to be about a dollar two cents is that right? Yes and then for the hourly earnings for employees and food marketing it's gone way up to 217 we're here in well this is up to 1963 the hourly returns and all farm labor and management is $1 one cents doesn't look like you've progressed very far there. Well you have the chart there I might also point out the product that the employees in food marketing use to achieve this increase in income is a farmer's product for example the men that deliver milk to the homes in Detroit it just as an example if they want a better price what do they do they don't deliver the farmers milk until they get the price that they want so they're using the farmers bargaining power to achieve this level of income where farmers haven't been using this bargaining power and they've stayed at this level. I want to ask you a question Don if if you were to use your bargaining power and I you call us a holding action right? Right. Now if you were to use that say with milk you fellas are gonna run into a lot of trouble people are going to say right off the bat was there holding the milk back in here is my four little baby and it needs some milk no I left the opening there because we talked about this before and you had very good examples of a couple of stores on the same street. Okay, first of all you mentioned the point that if farmers hold their milk they're going to be on the term is you're going to be starving babies we don't tell our milk to a baby we sell it to a processor a dairy plant and when this dairy plant is through processing our product and puts it on the market he doesn't care how long the baby cries he puts a price tag on that milk 22, 24, 25 cents a quart depending on the area now as this example that you were referring to we're filming this show in Michigan Saginaw, Michigan area and I was living on State Street which is probably one of the one of the nicer streets and one of the most newly developed streets in in Saginaw and in a matter of about three blocks there's a difference in price of eight cents a half gallon in other words there's a dairy store there that has milk for sale at 33 cents a half gallon, there's another store there about three blocks away that has milk for sale at 41 cents a gallon, this is eight cents a quart difference for eight cents a half gallon difference which would be four cents a quart difference or breaking this back to the farmer the farmer sells 50 quarts of milk, a hundred pounds of milk for around four dollars a hundred if the farmer were to get this increase of four cents a quart on the farm it would amount to two dollars 100 more for the milk that he has for sale in other words people are paying this difference in prices today but the farmers aren't realizing any increase in price. Okay, now what can the farmers do about this? Well, of course the answer here is collective bargaining, we feel the answer is collective bargaining, getting together so that we can put a price on our product based on cost of production. Actually all we're trying to do is the same thing the man in the grocery store does, we don't walk into a grocery store and say it will give you fifteen cents a quart for milk he says the price is 22 cents a quart or 24 cents a quart or whatever it happens to be. It's basically the American principle of the producer, putting a price on the product and as we say of course we can't do it as individuals we'll have to do it on an organized basis, as a group. What are you trying to tell me here that the the company comes out picks up the milk and then tells you what they're going to pay you for it? Well yeah, I carried even a little further. Ron probably got something he wants to say on this too but to carry it a little further if we walk into a grocery store and pick up a quart of milk, walk over to the counter and lay down fifteen cents or well the farmers getting about eight cents a quart let's say we give him twice what the farmer gets, we lay down sixteen cents and walk out with that quart of milk there'd be a cop after us pretty quick "you're stealing milk" but yet this is exactly how the farmer markets: he has a bulk tank of milk in his milk house, the dairy sends a truck out there, it back up to the farmers milk house, plug into his electricity, use the farmers electricity to pump this milk out of the bulk tank into the tank truck and then a month and a half later they send him a check for whatever they think the milk is worth. It's actually it's the same principle on a larger scale. Not only in milk now I know in cattle - and Ron had a very good example could I see those slips that you have right there? this sort of amazed me here just pass them down I'll try - thank you here in 1958 the 1,400 pound cow is a cow that was sold wrong it was sold for two hundred eighty four dollars and twenty cents, that's a fourteen hundred pound cow. Now in 1964 in November 23rd of 1964, the cow that weighed exactly thirty five pounds more, fourteen hundred thirty-five pounds, was sold and this seems unbelievable to me for fifty seven dollars and eighty-eight cents. Now that's some two hundred and I'll call around two hundred and thirty seven dollars there, two hundred and thirty six dollars less, how come? I think due to our lack of bargaining power, I feel that they were quite good to me even at the fifty seven eighty eight because I didn't ask him for anything more, I just unloaded this cow at the yards and whatever they were willing to give me I was willing to accept. Why is that Ron? This this is the thing I can't understand now. Well individually, if I were to feed fifty thousand head of cattle I would be a small percentage, a small fraction of one percent of the total of market yet there are processors that process eight eighteen percent of the total market. Now this gives me no bargaining power on my own and all it has to be done as a group through collective bargaining. Now, if the group gets together say you're from Isabella County say all the farmers in Isabella County get together and they're going to hold our cattle off the market until they get a little better price, I understand you're not asking for the sky or anything like this now this is this holding action we're talking about, what keeps the farmer from let's say one of the other counties, we won't pick one out here but say from your next-door neighbor, from selling and taking his cattle in there and selling them? Well, in the first place I think we're all neighbors regardless of where we live in state or county or anything because we're all in the same business and we all have got to get together and do this collectively. Actually there's nothing that will stop this neighbor from taking his meat to market, this will be entirely his choice. I think though if he understands what we're trying to do, thoroughly understands it, that we are just asking for prices that we've already received in the past, we're not asking for any increase in price I think that he will go along with this type of a program. Now one one thing I want to ask here too is that Don we were talking before the show, you brought up a very good point if you had been talking to a farmer, a little older farmer than you fellas and your your big aim is to get the farmers together that's the National Farmers Organization is to get them together so that they will have a bargaining power and they said that this isn't anything new said he was one year from retirement age, which would mean he'd be 64 years old and he said didn't I think most of the farmers can remember this, he said that the farmers used to go together and well thrashing for example, they'd have a thrashing machine, one farmer would own a thrashing machine and eight or ten of the neighbors would get together and they crash they're green together and samely when it came to building a barn farmers would all get together and they'd build a barn, one would help, you help me out and I'll help you out. Then as farmers became mechanized and they got their individual machinery on their farms each farmer started to become a unit by himself, just operating by himself and the an old elevator man made a statement one time he said I can buy any farmer in the state for a nickel by this he meant that if he'd offer one farmer a nickel more than his neighbor his neighborhood think he was sitting on top of the world and by using this type of pressure they were able to get farmers competing with each other and as they got farmers competing with each other they were able to start lowering the prices to the level that we've indicated here of $57 for a cow that six years ago, eight years ago was worth two hundred and eighty some dollars. Now we're getting to the crux of it here like you say farmers are big businessmen, they they have to manage a lot of money, they have to manage a lot of area, a lot of equipment, a lot of animals and they're competing against one another in this big management. Now if they start to organize, they get it together, they can start asking for a little better price and some of their things now the first question we're going to get from the consumer is I'll let the farmers start asking more we're going to have to pay more, is this true? Yes, I suppose it is to a certain degree we can't escape the fact and we accept this in every other commodity we expect an automobile to be a little higher next year, we don't expect the landlord to lower the rent, if he's gonna do anything he's gonna raise the rent but it isn't going to be such a terrific amount we're getting and Stan maybe we could use your chart right in here to outline part of this if you'd want to use the pointer there maybe I can explain a little bit of it the farmers have 87 percent of the investment in the food industry and they're receiving 37 percent of the consumers food dollar. The processors and the retailing industry have only 13% investment and they're receiving 63% of the consumers food dollar. The point I want to make from this graph is that the farmer is getting relatively a small percentage of the consumers food dollar. Now a slight increase in the value of the farm products in many cases could be absorbed by the processing industry but I don't want to give the impression that it's all going to be absorbed. The thing I think we should point out here is that 10 years ago people, the average non-farm consumer was spending 25% of his take-home pay for food, today they're only spending 19% of their take-home pay for food. This compares with well the United Kingdom which is Great Britain in those countries is the next closest country in the world where the consumer spends 29 and a half percent of his take-home pay for food, in other words farmers are where we hear a lot of talk about the government subsidizing farmers when the fact of the matter is the farmers are subsidizing the rest of the economy by providing food so cheap people only have to spend one-fifth of their income for the most essential commodity which is food, something everyone has to have, it's a basic necessity and by providing food at these low prices people are able to have boats, trailers, gold skiing on the weekend, camping all these things that we enjoy in America today. What we are trying to get across here today is while people are enjoying these things many farmers are not there tied to a Dairy Herd that means they have to be there 7 days a week and they're not getting compensated on acum on a level comparable with the rest of the economy. Well let me understand this Stan I think I can see where you fellas want to make a little more money and I suppose it's up to the individual just how much he wants to make with it. A lot of people ask when they when they give you a raise what are you going to do with it? what what do you think the farmer's going to with the money? Well there's no question. Barbara is known for that sort of thing? Staying to pay those back bills and in addition he's going to buy. We have a terrific potential one in agriculture that would stimulate I say stimulate it would not only help farmers but it would help industry and the consumer as well mmm Well I think Ron had some good examples over there at Isabella County, I don't know if you were speaking just about Isabella County or not but about industry and looking for industry and they have an industry and don't even know what it is and what's that Ron? Well we need more industry as far as Negros vote last year in Isabella County there were approximately 15 million dollars worth of farm products sold out of it and feeling the way we do about our prices this would be about 30% under what we figure they should bring and figuring it this way probably at least 90 percent of that money it was spent in Isabella County for fertilizer feed seeds, building materials, our own living costs and things like this and at that rate there was approximately four million dollars that left the county that could have been there to have been spent for schools taxes, any number of things and I feel that while we're looking for industry that we have the industry right here and we're not taking care of it. Now we've been talking about some of the things that are happening why you on a little better price, the reasons for it I think most of the farmers that are looking and know this we don't we don't have to tell them that maybe some of the consumers are watching are a little surprised at some of the facts and figures. Don you're a younger farmer said you just started farming back about 1958 is that right? Right. Well now what do you foresee for the future are you looking for things to to get worse or are you looking for things to get better? Well I'm going to base this answer on the reception that we've had to the NFO program, especially in the area that we're working in right now. More and more farmers all the time are coming together in the NFO getting together to work together so we can achieve our fair share of the nation's economy. Based on this, I think agriculture has a tremendous future either way agriculture does have a tremendous future. The story or the statement was made here this evening that by the year 2000 we're going to have to increase our production 100 percent in order to supply this increasing population that we have there seems to be a race on at the present time as to who's going to be in control of agriculture, farmers or big business. There's a trend toward big business getting into it, we feel it should be the individual farmer having control of agriculture the end of the small businessman is attorney I suppose you would use as a pump as a farmer having being the producer of agricultural products just as we have in the past. We've been told we should get more efficient and that the small farm cannot be efficient that it's the big farm there's a large operation that is efficient but this is not true, the actually you're what we call a family size farm a unit of land and buildings and machinery that can be operated by a farmer and his family is the most efficient producing unit we have in this country. You're on air Don, that's one thing I want to bring up and everything like you say everybody says well the trend now is to bigger farms but less farms. You say now that this doesn't have to be, is that right? This is right, well we've eliminated half of the farmers in the last 10 years it hasn't solved the farm problem, in other words we've got half as many farmers now as we had 10 years ago but it hasn't solved the farm problem we're getting less now than we did 10 years ago so we feel we've gone about as far as we dare go on this matter of producing more and getting bigger we feel it's time we got together and started to price our product. Well me that's all I have to say right now. One thing I want to ask about that Don and maybe Stan can help here too because Stan brought up the fact that I didn't realize and we keep hearing about holding actions all the time and every time someone mentions the word everybody gets a little uneasy and at some tempers start to flare and some friends are no longer friends for a couple of weeks or so but that is a holding action to hold something off the market then stances while I do that half the year and a lot of farmers do it and they probably don't even look at it as that but they are participating in a holding action and that's what your milk is that right Stan and then how do you do that every other day is any? Any other day we have a ballpark up we don't think of it as being a bowling action because we're simply holding it two days for it to be picked up and taken to market but we are holding, we are holding the milk cap half of the year. Well now the holding action is the word that I I'm most familiar with, that's the word I know but are there other ways that you fellas can get together and to to get the price you think that you're worth or or somewhere near it other than a holding action where you're going to have a few unfriendly neighbors or people around saying well they're there they are again the nfos yet another holding action going? I think there is Jake yeah, the only thing standing between this program and reality is a state of mind, just reaching people. Well what is, is it the farmer field that and this is no aspersions I wasn't personally, but does he feel that he's not as as good as the next businessman? Is he feel that he can't command that price or just was it? Does he have an inferiority complex or is he afraid that the farmer down the road isn't going to like what he's doing? Where is he just afraid to make the decision? Jake don't you think, let me answer it this way, this is what I think, you know when rubber tyred tractors first came out the farmer said those are the worst thing that you can ever do if you get a rubber tire tractor it'll pack the ground so hard you know be able to plow it, you'll poison the ground. The same thing was said about chemical fertilizers when they came out they said don't use chemical fertilizers it'll you just won't get any crop it won't work and any new idea in farming that has come along has met with this type of opposition I don't think this is true just to farmers I think it's true in with people in general, it takes time for the public to accept a new idea and NFO is definitely a new idea in marketing and I think this is our problem it's a matter of there's not enough farmers that have had an opportunity to have the program explained to them so that they understand it because we say that once a farmer understands that he'll join nfo this is what we need, this is something we've been looking for for years a program of this type. I like I like the phrase you used there, the NFO is a new idea in marketing and I think that's that's just exactly what what do you have behind it, is the principle. Now how are you going to get these farmers to to to join in NFO what do they have to do to join if they're I know that a lot of them have been thinking at times well maybe I should get in an organization, maybe I should become a little bit bigger businessman by joining an organization to give us a little more bargaining power there how does he go about joining NFO? Well of course we have a large number of members in the area they there are people working down the road and we're starting on a drive will be shortly where farmers will be going out on the road and contacting other farmers that are not members of the organization and explaining the program to them but at this time if any farmer is interested in joining the organization we're asking him don't wait until someone comes to you, we are short on manpower, we're short on help in other words to get out and do the job. If you're interested in the program at the end of this television program there'll be a place designated where you can write to to find out more about the NFO and we will be setting up meetings in the area which will announce a little bit later in the show here where farmers can come to the meeting, find out about the program. This is all we're asking anyone to do, just come to us, come to our meetings find out about our program and make your own decision as to whether or not you join the organization. How our time is running just too fast here for us we only got a couple of minutes left but I would like to ask each one of you the same question. I like to start down there with Ron, do you think NFO is going to do it right? I think that NFO is got to do it. I think that when the farmer starts to realize that his commodity is used it has a price set on it after everybody else handles it, every handler that takes this product sets his price on it I think the only way the farmer can compete in this highly competitive society is to put a price on it first, he has it first and he's going to have to do this I think that as Don said this is an educational program where there are monthly meetings and more often in some cases held in most every County and if these farmers would come out him just listen and ask questions I think that this would do it I think so. Stan what about you, do you think Ken Apple was going to do it? Yes I do, Jake. I think the farmers mind Apple started managing his own business rather than just being an operator annoying someone else take care of the business in. Well that's going to be a new it that means a new education if I am almost doesn't it that I know we haven't got too much time to go in that, maybe that's something we should have gone into a weekend at a later date but it is, it's a new thing for him he's gonna have to educate himself to to do it not that he can't do it but it's he's been have to come in from the field all then and then spend a little time. Don what about you? I know you're you're a younger fella, you're starting out in farming what you said 1958 and you plan to make it your career so you must believe in NFO. Well definitely, I I think these fellows have both explained it very well where they said it has to work, it has to work there's no reason it won't work it works for everyone else today it's a simple matter of the farmers getting together to put a price on their product just no different than the grocery store man. I think this is the best example there is, the man that owns a grocery store doesn't put his production on the shelf and say what will you pay for it he puts it on the shelf and says this is a price we have to have in order to cover our cost and stay in business and this is all we're doing in a nipple. Don I know there are a few meetings around would you'd like to give them the meetings at this time. Well, we'll have a meeting next Tuesday evening this will be January 19th at the Munger town hall this is right out here north of there north of the TV station here, then there'll be a meeting next Wednesday over at hemlock at the hemlock high school. They're allowing to thank Stanley VanFleet, the chairman of the TV committee and how does it feel to be on TV Stan? and also Don Troast, the assistant national organizational director of NFO and Ron Urban, the vice chairman of Isabella County NFO and this is Jake Jacobson, your host there we are over there and we want you to join us again next week for the Midwest farm report and I've been enlightened today, I hope you have too and remember the NFO needs you