NFO-17 (AV10426): Midwest Farm Report: Look at Rural America

[music] my name is Butch Swaim a farmer from southeast Iowa also national promotional director for the national farmers organization NFO at Corning Iowa today on our Midwest farm report we have a number of guests that are interested in the farming picture as a whole quite interested in business and various other interests from around the country and I'd like to start out by introducing to my extreme right over here Coleman Scott a businessman in the Midwest and other places throughout the country then to my immediate right Jim Parker the Parker vacuum-cleaner supply company of Des Moines Iowa and then on my left I have Ed Shima a large farmer from over in Iowa County Iowa that helps in his spare time to get people to understand the farm problem to get others to see that we farmers should work together to solve this problem and to start off with today we would like to bring a few figures here in a recent survey that was made of the Sioux City, Iowa livestock market now on one given day there was enough hogs and enough cattle on this particular market that we want to show you the loss of income that is taking place in rural America there was receipts this particular day and these are actual receipts and actual prices that the farmers received neveress receipts this particular day of twelve thousand ninety nine head of cattle and the top price was twenty one dollars now supposing that everyone received the top price which everyone knows they don't but nevertheless they were still being shortchanged at least $11.50 a-hundred from the prices they should be to get the farm prices and balance with the rest of it and the same has been figured out on hogs and it was found that in this one day's marketing the farmers in the area around Sioux City, Iowa marketing area along with shortchanged one million, six hundred, and four thousand, a hundred and ninety three dollars just on one day's marketing this is the astounding figure that has caused the businessmen of rural America is causing them I should say to wake up and find out that the farm problem is not just a problem of the farmers but a problem of everyone in the United States and first I would like to call on Mr. Coleman Scott who is a businessman advertising business various other things why don't you tell us Coleman how your business is and how it affects you as you see it well butch I think probably the most important part of it as it immediately appeared to me a few days ago I was in one of the areas not to very far from Des Moines talking with a man in the automobile business now this man does all of his business with what we call rural America about 95 percent of all of his business is done directly with the farmer I was talking with him about a problem which was quite important to him and it was important to me because he was a part of an advertising campaign which my firm was about to handle and he said truthfully Coleman I don't want to do any more business well this is up obviously something that is very strange because here's a man that is not only a good merchant but he has a record of being a good businessman and I said what causes you to make a statement like that or he reached in his desk for a stack just about this side and he said all of these represent a series of people with whom I've done business with for years who have had excellent records of pay these people are now all delinquent this has now forced me to become de liquid at the bank this has never happened since I've been in business in my conversation he went on to say it's very tough for me to sell something to a grocer for instance who does business with a farmer when the farmer doesn't have any money now over and over I guess all of us have heard the story of the farmer who benefits to the extent of having two Cadillacs one for town a one to drive down in the South Forty this automatically caused me to ask questions from him it was this that caused me to first make my visit to you to ask for additional information NFO was comparatively new to me I've of course seen it read it as a as a newsman I've been in cut in touch with it to a large degree because I've come in contact with certain activities certain things that have been said certainly their national meetings and frankly butch I wondered who it was that was opposing the farmer from getting his legitimate share of the National part of the gross national product this was what first caused me to ask these questions of you now at your office I picked up a sheet of paper it's a pink one here this is obviously something people may see I guess the cameras not turned on it but it impressed me because I had recently driven through the area- pardon me- which was mentioned in this particular article was referring to a particular part of one county of the state of California which to a large degree is owned by a major land corporation now this company has a holding of two million four hundred and twelve thousand a hundred and twelve acres now this is one company now if somebody were to call this corporate farming this would obviously make a lot of sense but that isn't the truth because in addition to owning this two million four hundred thousand acres they're also the largest producer of livestock in one of the foreign countries they own 51% of the stock in a major implement corporation but their big cash return comes from the 27 percent oil depletion benefits which they enjoy through the series of the one thousand five hundred and fifty producing oil wells which are on there two million four hundred and fourteen thousand acres so they produce cattle enjoying a tax benefit from the oil depletion of the twenty seven and a half percent allowance and suddenly you're not talking about farming anymore you're talking about people in a variety of businesses the strangest part was not their holding of this but the fact that their board of directors also had members of the board of directors of one of the largest food chains in the United States now in reading some of your material which was placed at my disposal I noticed that many times many of those people had been most belligerent in opposing the farmers position for collective bargaining what is this story Butch well this story is to make a long story short come right to the point here I don't know if the camera can see this or not but in the October convention of the chain stores why the vice-president of the chain stores called for an out-and-out abolishment of the family farm system of agriculture in America but what's the problem I don't know really unless it's because the fact that in the next 35 years the amount of food produced in the United States is going to have to weigh more than double we're going to have have to double everything virtually in America with the exception of the tombstones out here in the graveyard Coleman and Agriculture has produced seventy percent of the new wealth that goes into the money streams of America to keep our industry running and it's very obvious that some of the large interests would like to own control agriculture this is the only reason that I can see they didn't say why they attacked of the family farm system agriculture but nevertheless they call for the abolishment of the family farm system of Agriculture well now one of the things that I have noticed the National farm breeders the breeders of cattle those who are feeders of cattle consistently point to the amount of money that has been lost by the cattle raisers yet one of the largest rubber companies in the United States maintains ten thousand head of cattle on one of its ranches again enjoying a series of the twenty seven percent oil depletion it's pretty tough it would seem to me for a man who raises a hundred head to be able to compete with this kind of an operation well NFO would correct this situation because the people that all the people that grow a hundred head would band together and would equal ten thousand head in in a lot in other words it would equal anything far greater than all the rest of them own put together this is what the family farm must do they must band together through the NFO collective bargaining plan so that their bargaining strength is not only just as great as any other food producers in the United States but is greater then the bargaining power of those that are buying the farm commodities well I had a man pardon me Butch I had a man explaining to me I asked some questions of people in the processing business today knowing that I was going to appear with you and he said Coleman it's probably the strangest situation that exists he said we in turn create a processed meat product we know what we have to sell it for because the people we're going to sell it to tell us what they want to sell it for they're going to add their profit and we work backwards they're going to sell it for 69 cents we know what their markup is so we know what we're gonna sell it to them for him by the time we finally reached the point where we buy the product that's going to go into it we have to say to the farmer this is all we can tell you because that's all there is now everybody else's profit had been added to it now they were at the point of origin this is exactly opposite of any other manufactured product in America this is exactly right and this is why the farmers must act and act now because their whole industry is in jeopardy and everyone else in America sets their price based on a cost of production and then a reasonable profit why shouldn't the American farmer be entitled to do the same thing to start at the origin of the product in other words maybe to set a price of it based on what they know it's going to cost to produce it before it to the crop is ever planted before this operation starts and then ask and receive that price well Butch of course the biggest the biggest argument against well let's take one particular item the biggest argument of course against the business of the farmers collective bargaining has been the fact that you'd price yourself out of the European markets in the foreign markets now I found that interesting reading well where's this to me isn't a problem because why should we depend on the European market for a living when we have plenty here in America why should we depend on the European market last year Coleman we did sell one acre and four out of each four in foreign trade but you know why we sold one acre and four in foreign trade for the simple reason that we couldn't make a living on the three acres that we sold at home so we built a surplus product so we build a surplus and we operate wholly in surplus so there's only one difference no doubt you realize this much better than I would or much better than the average farmer out here but did you ever stop to think with the only difference between a surplus or a so-called surplus and an inventory is to set the price on it so we at NFO believe that we should get together and set the price on our commodity change our so-called surplus into an inventory just like any other good business in America does well Butch I was in your office as you will recall when Jim Parker another businessman walked in and asked almost identically the same type of questions I asked so I was real pleased when you said Jim and I would be together in the same show this is ironic folks these are two businesspeople that walked in the office the very same day within a matter of a few minutes apart concerned about the same things concerned that their business was going down with the farmer so that farming the farm problem is no longer just the problem of the Farmers of America but it's a problem of all America and at this time I would like to to ask Jim Parker to express his business views and why we walked into the office and why but his he told it as he put it and I want him to explain it in his own words a little later and, as he, the more and more that he looked at this farm situation the more that he felt the noose tightening around his neck but he would no longer be in business if the NFO should fail and this was just two days ago I never saw the man before but he's a real shrewd businessman folks and i would like to express get him to express his opinion why it is that he thinks as he put it to me that every businessman in America should be concerned and every businessman could should be willing and ready to help solve this farm problem well Butch this is an unpaid testimonial I agree unpaid for sure but whether or not it'll be a testimonial depend the course on whether or not I can learn a little about the NFO and that's my reason for being here that's my reason for having come into the office my business consists of contacting dealers in small communities through Iowa northern Missouri little of Kansas a little of eastern Nebraska and about two years ago I began to feel this pinch I put a dealer in a little town of Pattonsburg Missouri and I come back six weeks later to call on him and he was gone now this has happened a number of times I'm becoming aware and I had become aware at that time that this little businessman in this town when he tells me he doesn't have the money to buy today I contacted approximately six dealers that told me this and these dealers were well-established had been in business for a number of years and they feel it if these dealers are affected then they're going to be other businessmen surely like me I would presume several businessmen who have already been put out of business I'm on the verge at least in this phase of it I come into your office in the hope that I could find out something from NFO I've been concerned about this holding action some people agree with it some people disagree but one thing about it I was favorable to the NFO because they're doing something I saw these television programs that you have had on Sunday afternoon and they were good they had they had good effect I like the I like the way they go about this thing they're going to make an effort to do this if they can find a way to bring to the attention of the businessman to the Iowa citizen to the citizens of this country the fact that we surely got to take care of our farm program we've surely got to get the economy of the farmer right every time isn't it true that every time a farm closes goes out of business we die a little more yes this is true and we lose more business people all the time I'm real glad Jim that you brought up this fact of the NFO holding action because this is probably the most misunderstood thing there is about our whole program but I'd like to call your attention in fact with everybody in America that's in business every working man that works for a wage all of them have a holding action all the time did you ever stop to think that you have a holding action on your on your business all the time that you set a price on your commodity and you hold for that price but simply this has been established before you were entered business to the point that everybody walks in or that buys from you pays this price without ever thinking that you have a holding action and the fellow that you sell it to from the wholesale level he has a holding action too he holds it until he gets this price he puts the legitimate market based on a cost of production plus a profit the same way you operate your business and he has a holding action now is it so wrong or the American farmer to do exactly the same thing we hope to educate the people and the public that we're entitled to a cost of production plus a reasonable profit and then as soon as they become aware of this situation and acknowledge this fact then we will no longer have to have a holding action such as we had before that you're referring to this holding actions we've had in the past have been to call people's attention for the situation and to test our bargaining strength with the processor the very much the same way that a labor union for instance has a test of strength when they have a walkout or at least to gain the same respect that everyone else has the right to set down and bargain in America for a fair price Jim this basically is NFO are we moving- is it moving forward now moving forward real well we've been expanding into many more states recently where we have somewhere in the neighborhood of two or three hundred people that are working whatever time they can out in the area we're gaining very rapidly at this time I made this statement many times and it's true it's been proven true all the time but everyone in America will support the NFO plan of action will support the NFO efforts as soon as they understand again in fact is I will make this statement to anyone anywhere in America that's against the principles of the National Farmers Organization are against American form of government and I say this for two reasons that number one it's been the law of our land for some 23 years now it's been legal for the farmers to band together and organize and do exactly what the NFO is doing and number two it's the same business principle that everyone else in America uses all the time every day that they're open for business right now can I make another point Butch just before you leave me here every community in Iowa at least every little town that I go to when I Drive down the Main Street I see empty buildings businesses used to be in these buildings but now they're not there anymore we can't pin this all down to one little community or one group of communities just recently I drove down the Main Street of Cedar Rapids from Marian driving west down First Avenue and right down in the heart of the middle of Cedar Rapids in in an area of a block or a block and a half I counted four or five empty buildings now here's one of our leading cities in the state of Iowa Coleman you you saw this yeah I saw that the thing that the thing that impresses me when I see such a thing is I wonder what it was that caused a businessman who had an investment in a community to say it's got me I can't take it I wonder what it was that caused this man to say there is no future in business and get out of it now this is what scares me when I see that do you think it's all of the farm, to attribute it to the to the farm economy no I don't attribute it to the farm economy if I did I wouldn't I wouldn't keep asking questions I don't know who's to blame I keep wondering these points if a man who works in a factory does not make enough money to pay the milk bill I know he can't buy milk so the government says to him look we're gonna give you free milk right now this doesn't make sense to me somebody should pay him enough money so they can go buy the milk right but if they do this why did- they why did the milk cost 30 cents a quart when it gives given away free to him because he didn't have enough money to get it and the farmer got six and a half cents a quart for the milk anyway that he can't buy it either if the farmer didn't have the milk on the farm he doesn't make enough money to bought it either now if the farmer does not produce a milk product he can't buy milk for his kids today in many cases now this is the thing that causes me to ask why if work is work and labor is honest I started to ask a question a moment ago here butch says this has been going on for 20-some years actually Arthur capper who was the great friend of the farmer originated the act in 1922 the capper-volstead, 43 years 43 years that's what I was going to correct you on but thank you for letting me interrupt I didn't mean to and now we're going to turn to farmer the fellow that farms for a living raising his family doing a real good job farming one of them more or less a big scale not real big scale but as far as a family farm it's considered a real bit operation a good 50 operation an operation where efficiency is practiced where's diversified he raises a number of things and Ed would you care to fill in as you see it what is the solution of this farm problem so-called farm problem well butch we have in my community over the years a number of our really what you'd call good farmers have been leaving and this trend is continuing as I see it looking at my community we're by and large we are all of us are pretty efficient farmers we have rather large operations we aren't what you'd call marginal farmers at all but still when I look at the my neighbors practically all of them almost without exception are working in the town to supplement their farm income or if they aren't their wives probably are almost without exception now this is a great concern actually then you look at the community I live in fairly good land and fairly good-sized farm operations but still they aren't making a go of it now over the years we've seen these house farms be become larger being consolidated and going into the future I think this is going to continue then as you look at these farms now they're large investments it's hard to finance this type of operation as they continue to get bigger I can I wonder who's who's going to finance these certainly the family type farmer can't continue to finance a large- larger operation under the present income structure that we have so then the question is what should we do about this and as a farmer in Iowa County Iowa it seems to me that we need to look at this in a more businesslike way do like businessmen do put ourselves in a business position of pricing our products and in doing this this requires some responsibilities you have to accept some responsibility to price your product you have to accept the responsibility for the surpluses the market might not absorb at this price you have to accept the responsibility for an even flow into the market you have to be in a position to convince a consumer that this product is worth is this increased priced or and without elaborating on these points I think that there's no question what there's only one solution to this problem today as I see it and that's the National Farmers Organization I think that until farmers are willing to put their heads together in terms of marketing I don't believe that there's too much hope in improving the farm situation today thank you ed and I think you did a real good job summing it up I'd like to touch on what it really cost not to have the farmer in balance with Reston it not only cost the farmer it costs all of our total economy fact is a survey made by the independent bankers organization this is the small banks or rural banks of America where the new wealth originates they've made a survey and they prove beyond a shadow of a doubt had the farmers been paid in balance with the workingman and with interest that our total national economy would have been 303 billion I said billion dollars more than it would have been in 1963 in other words it would have been 50 percent higher everyone in America would have profited by increased farm prices because this price would necessarily have to raise at all to the consumer fact is consumers were paying far more for a pound of beefsteak when we were getting 32 dollars and a half or 32 and a half cents a pound for our cattle on the hook and we were getting 24 to 25 dollars for hugs then they were paying far less for food than they are now the Department of Agriculture shows that while food prices have gone up 29 percent to the consumer the prices that the farmer received for the same amount went down some 12 to 15 percent so I don't know Coleman who's getting this but I'm beginning to wonder like you who is it when it will help everybody help the total economy and help everybody in America who is it that would hold down the farmer what is the ulterior motives behind it to starve out the family farm in America there's no question about it now the independent bankers made a little bit farther study they showed that if the farmer had been in balance with the rest of the economy that he would have had twenty one and eight tenths billion dollars more than he did receive in 1963 or in other word folks for every dollar that the farmer got to keep or was able to keep in his business as income he was cheated out of approximately $2 by somebody somebody got about $2 that should belong to the farmer now had this happened rural or business and professional income would have been 11 billion dollars more rental income would have been 4 and 5/10 billion dollars more corporate profits of America would have been 10 and 4/10 billions more in other words forget the farm income up where it belongs would cost nobody anything wouldn't cost anything at all because the total economy would far more than make it back the working man would get much more income or an opportunity to work more hours for instance in the loaf of bread the farmer only receives about 2 and a half cents of it anyway so if bread went up 1 cent a loaf the farmer would get 2 or 300 percent more profit than he gets off in the wheat that's in the loaf of bread so as you see it costs nobody anything to get the farm price up and it's costing everybody it's costing them billions of dollars three hundred and three billion dollars gross national product because they wouldn't let it come up where it belongs now I wonder why and I would like to say this to you with all sincerity if you're not opposed to all this new wealth coming into rural America at decent farm prices it's time that you begin to look around as these businessmen have done begin to look around and see and wonder who is causing the farm prices to be low who is getting this extra money that all should be available to the farmers and to all of our economy on an equal basis I think it's time that we look around now in closing I would like to call on the rest of the farmers in America to become good businessmen and women and set our pattern up in a businesslike structure and operate our business by all except a good business principles this program today has been brought to you by the farmers in this listening area and others interested in seeing the farmer get a fair price tune in again next week for more information and join the farmers of America to solve the next week for more information and join the farmers of America to solve the [music] next week for more information and join the farmers of America to solve the problem thank you