NFO 160 (AV10658): Future of NFO

[music] us farm report a public information program brought to an interest of Agriculture's rural business and the well-being of our nation by members of the national farmers organization in this area and others interested in having American agriculture receive cost of production plus a reasonable profit the American farmers are building a brighter future for agriculture through the national farmers organization the organization that awoke America and represents the leadership of Agriculture u.s. farm report now presents a look at agriculture and its effect on the economy with some of our nation's outstanding leaders this is Barney Arnold in Louisville Kentucky reporting for us farm report our guests on this occasion our three gentlemen from the national farmers organization we're delighted to have mr. George styles immediately across from me here he state chairman of the Kentucky State NFO from Howard's Town Kentucky and mr. Erhard Pfingsten from Sergeant Bluff Iowa I finally got that located right there Erhard national vice-president and on my immediate right mr. Glenn Utley from Fort Branch Indiana national director from the Hoosier State gentlemen welcome to our program and we'd like to start this out here by getting your comment sickly and if you would about this big convention that we have here in Louisville what do you think about it well Barney I think this is the best convention that we've ever had in the organization and I think the delegates are going home here and go to work and be ready for some action George I think you and your committees Earl and the boys have really done a fine job on the arrangements that's been my casual observation Thank You Barney Earl did most of that out have to admit Earl has been real good in I've heard a lot of real good compliments from the people of Louisville and our delegates Mr Pfingsten will you concurr yes very much so the Kentucky boys are inclined to be a little bit modest except when they're in Iowa talking about Kentucky when they get out of hand but I think they did do a terrific job from the attitude that I pick up around the convention they are pleased with this site here most certainly we as officers are very very highly pleased with the convention than no question it's been one of the finest that I have ever attended and I'm literally amazed at the unity and the determination to solve this problem once and for all the theme of your convention is no price no production and from the reaction that I get from the crowd out there they mean just exactly that don't they no doubt about it notice what makes it such a good convention and the facilities are wonderful we're ready to go all right let's let's go back into the background on this and I'd like for you Mr. Pfingsten to give us the general agricultural economic picture as you see it today well the according to Carl Wilkens who has made a lifetime study of the impact on American agriculture on the economy of this nation the raw materials of course are the basis of the nation's economy in other words the raw materials from agriculture from minerals they're the same as the deposits in the bank you don't make any deposits you can't write checks indefinitely on but according to mr. Wilkins for every $1 that is paid to American agriculture that $1 generates $7 of earned income by time it gets through the entire economy and actually an average of 3 dollars and 64 cents within the county in which it is produced so when you shortchange agriculture or the American farmer then for each dollar that you shortchange him you robbed the entire economy of $7 of earned income and of course when it doesn't come from that source then it has to be made up in another way it has to come from either taxes through government projects or through borrow of money and we have reached the point where we have depleted our economy by shortchanging by exploiting the producers of agricultural products which is 70% of the nation's the basis of a nation's economy mr. Pfingsten I understand that agricultural income is going to be down around 8 or 10% this year compared with 1966 and that farm prices farm income is less than it was 20 years ago now this doesn't hardly seem possible but I guess it's true that is the net income is way beyond way below what it is farm income the gross is probably up but we are producing so much much more I'd like to take it to a little bit different way the prices that we are receiving are less than they were at 20 years ago the last official publication that I saw of the rate of parity which means a fairness of prices related to other segments of the economy was 74 percent and that was last April well since that time just offhandedly I'd say that wheat has dropped fully 50 cents a bushel or 30 percent perhaps hogs have dropped five dollars a hundred to six and seven dollars one hundred cattle are declining corn well I guess I don't have to tell people in in any area what's happened to there it's below cost of production and we haven't been at that in that kind of a position since the very heart of the depression of 1934 there isn't a businessman in the United States a professional man or a working man anywhere that could retake the prices he received 20 years ago and paid today's high cost of living or high cost of operating and the American farmer can't do it either our prices have climbed just the same as anyone else I'm talking about our costs have climbed just the same as anyone else has had and we're not even receiving what we received 20 years ago it's got to bankrupt not only the American farm but the national economy of course twenty years ago we were in sort of a post-war time economy well when I'm talking about 20 years ago I'm talking about from 1947 on and we were quite a ways past that war then but this is an important period because it is one of the period that I think is generally agreed on that all segments of the economy were in balance so I think it is a proper comparison and they should have exactly the same ratio that we received then if they're going to be in balance you can't exploit any segments of the economy be it labor industry or anything else without destroying the entire economy and there's been a continuous exploitation of the American farmer for 15 years well I'm a town boy George as you know now I don't know this economy Barney well what I'm starting to say here to figure out what mr. Pfingsten said a while ago if any other part of our economy had to get by on less than they were making 20 years ago they'd be in pretty rough circumstances for example I'm making three times what I was making 20 years ago I don't know whether I'm worth that much more to my firm or not but actually I am of course it takes it all anyway to live but nevertheless money I don't really don't think personal illustrations here but I'm familiar with that I'm not a good economist like mr. Pfingsten but in the early part of the forties I started farming actually on my own my dad helped me up in Kazan 3600 bushel of corn at that time would buy a two plow sized tractor today it will take four to five thousand bushels of corn to buy that same two plow sized tractor gentlemen we have cried in our milk long enough I think what we want to do now is to tell what we're going to do to work ourselves out of this situation from what you gentlemen say it's obvious that something is going to have to happen here to give us a better farm income and this is where we get into the principle of collective bargaining that is NFO's main theme and the basis on which they are functioning when if you would give us your concept here off collective bargaining as it applies to the NFO principle I'd appreciate it well actually Barney collective bargaining is just more or less farmers bargaining together and selling together this is collective bargaining yeah now to get into our program we're starting out here from this convention of course of talking about grain and all commodities of course our grain program within the next few days the boys going to be back out there pushing it hard and we want to go into a holding action on this grain as mr. Staley made in his top not more than 40 days from now and then of course the meat the dairy will be coming at the proper time you have to gauge these things now a holding action which I would like to explain a little a lot of people say well they don't like this method to collective bargaining they're going along with collective bargaining but they don't like the methods they say of NFO well far as liking a holding action no I don't like it either don't think mr. Pfingsten here does mr. Styles but this is what we have left to do in other words when you go in and sit down with processors and what are you going to say when you come in to them and say well not here we've got to have a dollar and a half a car for corner we've got to have $3 for soybeans or $2 for wheat we've got to have this rails or else what this is what it amounts to in collective bargaining we're gonna deliver anyway no you've got to use this holding action this is a tool that every segment of the economy uses and we have given plenty a chance plenty of time here to do something and if they won't then we've got to do it some other way well it actually amounts to nothing more than let's say copying all business all industry of this nation they use the power of their production to enforce their price your automobile industry how do they do it they don't ask their customers what they want to pay for the for the automobiles they determine their price on the basis of what it costs them to produce that automobile then they tell their dealers this is what you're gonna pay or you don't get any automobiles this is exactly what we're doing for the American farmer we're putting him into a position where he becomes a businessman in marketing his production instead of a panhandler in the market which he is now under the present conditions well no I would like to say this I wish there's I agree with Barney we didn't have to do it I don't think really the businessman likes to tell a person that he can't get it but he has to use it or he wouldn't get it he couldn't get a price for a suit of clothes if he didn't just tell him you can't get it without you paying it's that simple to me well we're used to it you see with the businessmen this way businesses all that's been conducted we're used to it we think nothing about it we don't even realize that's what he's doing to us and I think it'll be no different in American agriculture once the farmer himself right becomes the businessman that he should be pricing his own production who knows better than he does as long as he's gonna say what are you give me how else can you hope to do do you all think that I'm not saying it I'm asking do you think that it can be done without the type of demonstration that we had when we had the recent relatively recent a milk holding action that this was I'm not criticizing the method that was used there but it did leave a sort of a bad connotation with some folks well of course it would depend on a lot of things or watch a mean you can't do it without cutting off the production no more than the merchants can enforce his price without refusing to let any man who won't pay it have it I think the real reason why it seems so unusual to him because the farmers been like a bunch of sheep just coming along being led to slaughter by the Judas goats you might say the nation over and so it seems unusual when the man who's been so docile and such a sucker all his life finally braids braces his feet I imagine it does seem unusual but it's nothing more than what I bring business every industry every professional man every working man that's in an organized group is always done so it's just following the leaders you might say Glenn now you mentioned the grain holding action this is the most imminent thing there's going to coming up be coming up within the next 40 days all right just how would this work briefly well what we're doing Barney we're asking all of our members to put as much of their drop 50% of it are more into a grain bank this to start with and this will be helped back here it'll be all for the market and then we have arrangements which we would this be skewing it would this be in commodity Credit Corporation storage no all right will be stored on the farm of course what we're coming when we go into this action area it just don't sell it lock it up all of it that's what's but this is what is going to count okay they got 50 percent of it in storage okay what happens to it then in other words we're going to leave that sit there until we can get a price for it are at the end of the year we may ship it but overseas or something of that sort but this is going to stay in this grain bank as we're calling it so right there and that's that much taken off of the market and what you have left here then you have to bargain with as well as what you have in your grain bank too now we can send it overseas maybe at the end of the year anyway do we consider soybeans as as a grain, soy bean, wheat everything complete I know what what is your goal price for soybeans soybeans is $3 dollar and a half for corn $2 for weeks soybeans are under two and a half right now on the market right now all right we they say we're going to have close to a billion bushel soybean crop this year thank you able to find a market we got a lot of competition in the oil business internationally yeah we have some competition you know we've heard a lot about sunflower oil the last well they're one of the reasons the sunflower oil is taking over but because the government pulled out of selling soybean oil here's some time back for the public lawfully so sure we're gonna have some competition but the only reason that the foreign buyers are buying grain oil or anything promised is because they have to have it this is what they're buying it so they're going to have to pay for it just the same as our own local paper in other words the idea about here is get a full fair price for everything that is needed why let a one or two percent that might be beyond what moves conveniently destroy the price on all of it this is what has happened so the idea is get a full fair price for everything that's needed the normal market channels and then that last percentage point or two if it's there then put that out on world market for it whatever it'll bring but get a full fair price like every businessman does he don't start cutting at the 1st of the year because he might have some something left over at the end of the year he gets it first and then sells out on a sale but he has left them and I think we pursued the grain bank idea considerable now would this be used any way Glenn in connection with the feed grains program or do you think that you can get along without the government programs that we have in existence and operate your program of the way that you'd like to well there's no question in time Barney we hope to operate this without any government programs I don't think any farmer really wants a government program but however you can't do away with them either at this point and this grain bank will not be working with the government program this is our own program yes I understand actually what it works in with barney is our surplus disposal program in other words this I think to have a bargaining organization you have to have a surplus program with it and to me I'm pretty proud of it on all the time doesn't permit here to go into it and explain it but other words 2/3 percent of production has been holding our prices down and this we gotta get away from and I think we should recognize one thing here that the consumers are I'm thinking about the people in town now primarily are nervous about what you all are proposing to do they are nervous that it's gonna increase our food budget considerable and they think that they're already paying about all it taking the port to for food I'd like to hear your comments on this well they are paying less a smaller percentage of their income today than they ever have in history about 10 years ago possibly just a little bit longer they were paying 26 percent of their income for groceries for food they're down now to about 17 percent so they are getting the biggest bargain that they ever got in history but I can see why they would be jumpy about paying for their food bill I don't like pay my grocery bill II don't like payment gasoline bill I don't like to pay a higher price for cars but the automobile industry didn't ask me whether I wanted to did you jut told me i'm going to so the consumer gets a little bit upset by those forces that are trying to keep us in the position that we are the forces perhaps that are trying to take over agriculture and I think that's when the consumer is really going to be exploited the corporation farming takes over you can bet they're going to set their price so I think that the consumer is unduly alarmed but there's something else too going back to my opening statement about that one dollar that the farmer is paid generating $7 of earned income look at the additional income the people that are on part-time work or that are probably totally unemployed what it can do for them so I think the consumer has just as much to gain as the farmer doesn't I think the consumer had probably be equally as much alarmed because if the family farm structure disappears they have been the best supplier of food anywhere in the world no other nation has the kind of a diet or as cheap a diet as a family farm is providing so I think the consumer had better be concerned whether the active family farm moves out or not I think he'd better watch another thing too because we're moving thousands of farmers off of the farm and we now become game become consumers and when we're added to the other side and that gives the very few that's producing it a chance to get ahead or price the consumers worry all right they better worry\ better not Nworry so much about the family about paying too much as long as the family farmer has it at today the thing that corporations build are the highest of anything you can buy it's higher than food well you let those same corporations control the food in this nation which they're getting ahold of and then the consumers really gonna pay through the nose I think there's another angle that I think we'd better bring in here and that's the job situation we have already eliminated within roughly the last twenty years three and a half four three over three million farm families represents five million workers at least and we're now now to 6 % of the population where some time ago about the time we started with a collective bargaining program we had 18% well the unemployment figure is not even as great as the number of people that have been brought him out of agriculture to put in there and compete for these jobs I think this is your problem in the big cities because a farmer is a specialist on his own farm but when he leaves that farm he's no specialist then he's competing from the very kind of jobs that perhaps these people that are unemployed in Louisville and Detroit and Los Angeles you name it that's where they go and I think your problem comes right back here to what we've done and we were I think that we should give a little bit more attention here to the livestock and and dairy programs that we haven't just barely touched on here briefly but I think this probably will follow soon after the grain program as far as your holding action is concerned is that right my opinion is it won't be long after the grain goes in total we're going the livestock probably these fellows could answer better than I own it but I'm sure that the milk would be the last I'll feel that way though this decision when that will be at it has been turned over to the National Board of Directors and of course whenever we add livestock and no question we will all right milk we will it's going to be considering many factors see at which time it is most opportune for us to add that where we can have the greatest effect there's about six days probably probably a little less than at this time that six days meat supply on hand so most certainly it will be effective and then of course dairy we had still later when all them are rolling together we add intent at every commodity there is no matter how small eventually bring them in its this is our slow goodness is what we're gonna do no price no production let me ask you this is there any conceivable way that this could be done without holding it well I don't see how you're going to do it you have to get an agreement to pay that you have to shut it off you wouldn't pay let's say whatever the price and I'll use a very modest figure let's say $50 for that suit if you knew you could get it for 25 will you neither these people so when that merchant makes an emphatic because that's a price you're gonna pay then maybe they come to realization you'll have to have it and you'll pay it so that's what we got to do but there's one important thing that has not come out in all of this discussion but I think very few people understand that just holding it doesn't do it this amounts to nothing if you're not backed up to feed that market with what it'll what it needs without breaking it in back again so really the entire basis of our program is to get our production sold on contract at least a year ahead at predetermined prices and then produced for that contract so just holding won't do it if we just held till we raise prices everybody sold it drop back you've gained nothing you have to have a way to tie it down and there's only one way you can do it and that is to get signed contracts and this is this is really well let's say it's a powerful thing a processor is going to have to sign for production these are year in advance if he doesn't get his production through contract he's cut out for a year he may be cut out for longer because our contracts is we're issuing them now provide that they're automatically renewable unless either party wants to discontinue so any processor that to the holding action or when we're wielding our power doesn't get in he could very well be out of the business we don't want to put anybody out of business we're offering it to all of them but they're going to write their own ticket whether they're going to be there or not we're going to sell it on contract and that's that here's the thing barney we don't want you to get the idea that we're not trying Louisville Kentucky reporting for us farm report we're going to sell it on contract and that's that here's the thing barney we don't want you to get the idea that we're not trying we're going to sell it on contract and that's that here's the thing barney we don't want you to get the idea that we're not trying something else we're talking with processors all the time meat processors dairy processors all up we will continue bargaining and talking but time is getting short here too many farmers are leaving the farm and the financial situation mr. Pfingsten just barely touched on the start of this program and it's serious Agriculture's in a serious situation the nation's in a serious valuation this is the basic industry they can certainly have our production Barney without a holding action if we'll give a surprise in the contract they're the ones that's really holding there are the ones that are saying whether we would really have a hold in action or not let me ask you one more question here before our times all going that is this do you have the facilities the manpower the financial situation as as it might be put to handle this kind of a job now that's an obvious question I'm sure but you bet we do I think we have the finest organizational set up a network that goes step through step down to where we can get in touch with any one member in a matter of our store with the entire nation I think most terrific said of them that any organization has and I think it would horrify some of the people that are fighting as if they knew how good this set up is it is terrific now as for money the manpower and so forth I don't think that there is an another group never has been anywhere that I know of so dedicated so determined as these people that we have in NFO thank you gentlemen our guest today mr. Erhard Pfingsten national vice-president of the NFO from Sergeant Bluff Iowa mr. Glenn Utley here from Fort Branch Indiana a national director from the Hoosier State mr. George style state chairman off Kentucky from Howardstown this is Barney Arnold in [music] u.s. farm report has presented a look at agriculture and its effect on the economy with some of our nation's outstanding leaders members of the national farmers organization invite you to tune in again next week at this time for more facts on agriculture and rural America which is the gear wheel in our economy that produces the majority of our nation's new wealth the farm income pattern sets the nation's prosperity and the national farmers organization represents new thinking in a new generation of farmers [music]