NFO-7 (AV10416): Midwest Farm Report: Success of Holding Action

[music] hello there the national farmers organization presents another in the series Midwest farm reports undoubtedly you've noticed in the news accounts the NFO has temporarily suspended the holding action I know there's a great deal of public interest in the national farmers organization and it's holding actions and the fact that they're growing each succeeding one covers a wider area involves more people and has a greater influence on this Marketing System but a number of questions occur to you what does the NFO do next what are the NFO's plans for a better marketing system how well did this holding action succeed many of these questions that have occurred to you can be answered today in this half-hour program because we have the top leadership of the NFO Oren Lee Staley national president Erhart Pfingsten the vice president and we have also on the panel today mister Don's Smalley who is not only a farmer from near Cedar Falls Iowa but is also an assistant to Lloyd Fairbanks the national organization director of the NFO these gentlemen are going to talk about this holding action about the technique itself and they're also going to discuss experiences mapped in this holding action and plans for the future first I'd like to ask Oren Lee Staley national president of the NFO to speak on this subject Phil I believe that there is considerable misunderstanding that still exists about the holding action the reason for it and of course the success now we in the NFO have learned to realize that there are several things we have to look for you might say test to see just how much success we've had now each of the holding actions of course have covered a wider area more farmers have participated and we've had many many farmers that have joined the NFO during the holding action and of course each of these holding actions we as we've covered a larger area we've had a greater impact on the marketing system now we have learned to realize of course that the only real weapon that those that oppose our efforts as farmers is they are the weapons that they bundle up all into one you might say that is psychological they must try to convince farmers that the holding action is not having any effect the only way they can do this is try to make receipts appear normal and so consequently they shuffle livestock from area to area and I say this the buyer is the part of the marketing system that today exists now they know that this is the only weapon that they have and of course after all the market news service gives out the receipt figures are not of course receipt figures that are tabulated by actual count of the marketing new service people but their receipt figures that are tabulated from those given to them by marketing interests and Packers processors and such so consequently this is like playing ball in somebody else's ball park and with their umpire but nevertheless you get down to the real facts of why a holding action simply the purpose of a holding action is not to temporarily raise the price of of the products but to get contracts to force buyers to come to those holding in order to fulfill their needs so that they cannot get their needs fulfilled anywhere else and therefore they must sign contracts that will do two things number one stabilize the prices of course for farmers at fair price levels but two and this is a very important point is to set up a marketing structure that farmers can set up this marketing structure that will make it possible for them to take from the normal market channels any surpluses that may exist or that do develop either and also the other points that can be used of the incentives price differentials and such as well as the surplus disposal program now when you get down to analyzing the progress made in the holding action that we've called a temporary halt on this holding action had a far greater impact at any previous action because so many more farmers participated and also the fact is that we at the national level are analyzing it basically from the reaction that we get from the processors themselves the holding action that we held two years ago this holding action we started contracts processors signing contracts this time we had pipelines feel that we're open pretty well too most of the large processors and they have simply said that whenever farmers force them to sign contracts they're ready to sign so this means it's up to farmers now if farmers keep their production on the farm under shut their lot gates then of course everything complete victory is achieved when we started this action when we started the holding action we started this differently than we've ever started before the National Board of Directors thought seriously about the problems that farmers face they analyzed the strength of the organization the position that farmers were in as businessmen so they decided that this was to be the opening battle of a continuous battle until farmers were receiving fair prices they felt this was the responsibility of an organization working for farmers to get fair prices for farmers they felt that farmers should have this opportunity to wage a continuous battle so the plans were simply this we would call a holding action we would throw in the strength of the organization into this action we would do everything we could to convince farmers by giving them the facts explaining our program and convincing them by persuasion and reasoning that they should hold and join the NFO of course our members hold and the non-member should join a be asked to join and support our efforts we also analyzed that if farmers did this strongly enough that it would all be over contracts would be signed and would be in effect and of course it means enough contracts would have been signed at this point that we would actually start getting the 22.75 for hugs is the base price the 32.45 base price on choice there's 29.45 base price on lambs and then of course this would lead to fair prices for all other commodities but we also intend to keep this action on until we at least had the processors in the position that of being more favorable and this we did accomplish now those that question whether we signed any contracts we say emphatically that we must be factual in our reports we have to be factual because we have membership agreements with our farmers that are members or with our members and if we were not to give the facts and if we were to give anything that was not factual then we would be organizing under false pretenses and the enforce illegal enforceable Authority under these contracts would no longer exist therefore what we say is simply has to be factual and we stand very emphatically on the point that we have signed contracts many processors are interested in for the negotiation and have asked to be able to negotiate in an atmosphere of Commerce so Phil when we say a continuous battle we started this battle with the plans that we would use frequent holding actions we would use these holding actions to build the fibers bargaining power give farmers the opportunity this to keep better understanding our program that we would then of course negotiate during periods of time in between the holding actions that we also would set up marketing arrangements they would start building farmers bargaining power also delivering to processors to show them that we can and are setting up an orderly marketing structure we have accomplished these points up to this point and when we said that we were calling a temporary halt we meant just exactly that we are giving the processors the opportunity to negotiate to bargain in an atmosphere of calmness but we also are preparing for more action a-another holding action that is very imminent in a not very distant future unless processors do sign insufficient numbers because this is a beginning and has been the start of a continuous battle that will be wait until farmers receive fair prices for their products and contracts are in effect you've been listening door Oren Lee Staley president of the NFO first speaker on this panel on Midwest farm reports as you noticed Oren Lee Staley considers these holding actions as part of a continuous battle sometimes this question is asked and I think that the NFO has a good answer to it but I want to get the answer from Earhart Pfingsten the vice president sometimes it's observed that any farmer who really understands the NFO's approach to modernizing the Marketing System would join the NFO any farmer who really has the interests of agriculture at heart and that the ones who don't join and who haven't are the ones who don't understand it before I ask this question of mr. Pfingsten I want to accentuate the positive for a minute an awful lot of people took part in this holding action and this one was ten days longer than any previous one and over a 23 state area now a lot of people were involved so a lot of people must have understood it already think why do they do it why do these farmers hold in these holding actions well as you emphasized it Phil once a farmer understands it thoroughly understands it then if he's a businessman at all he has to realize that that's the only way to solve this problem now really what we're doing here in NFO once it's understood it's not new at all it's what it's the way that every businessman in every town in the United States uses every day to get his price our organization establishes a price a price based on its cost then we offer the production to every processor in the United States now if they refuse to pay us a fair price well then we have to resort to the same methods that every other industry in the United States resorts to and that is if its customers won't pay the price that they're asking they simply refuse to let them have the merchandise well that's exactly what we of NFO are planning to do this is our program the holding action is actually only a tool in that program to give us the bargaining power so I think you're very correct Phil in analyzing it that once a farmer understands it he's going to cooperate because I think he can very well see that it is a sound business method same method others use why wouldn't it work for him it's worked for everyone else in the United States but the farmer and the only reason it hasn't worked for the farmers because he hasn't really tried it so our program is to a great extent an educational program go out there to talk to these farmers to explain to them what the situation is let them understand the condition that they're in and I think most farmers are beginning to understand that very clearly I think all I have to do is look at their bank balance and they'll see that that they're going to have to do something then get the farmer to understand that once a price cycle developed once a downward price set in that it continued to go downward overall with possible exception of a few small raises or I've heard Oren Lee describing this kind of bumps in the road other than that the general trend has been downward until we had a national calamity and in most cases that national calamity has been a war or a depression and certainly I think the farmers don't want their price that way now we can't afford to go into any national calamity I think we can solve our problem by ourselves by simply becoming businessmen we've outstripped every other industry in the world in efficiency and production but in marketing we're about the most inefficient slobs on earth we go to the market we say what will you give me and I think it doesn't take a man with reasoning power very long to understand that he can't solve his problem by letting his customer set the price so Phil as you pointed out this is our program to educate the farmers to get them to realize to understand it and once they do understand as you have very plainly seen in this holding action they will cooperate I think our membership along with other farmers who have not as yet become members but seem to want to become members I think we're really set to go out and go out of heavy I was amazed at the clamoring that we're getting to continue at the earliest possible date so I think the time is here that the American farmer is going to solve his own problem and why shouldn't he who else should do it if he's not interested in fighting for a price why should anyone else be interested in insisting on giving him a price that was the vice president of the National Farmers Organization Earhart Pfingsten farmer from Sergeant Bluff Iowa the third member of this panel on Midwest farm reports is mr. Don Smalley who is an assistant to Lloyd Fairbanks national organization director mr. Smalley gets a day-by-day view of the NFO's growth he gets to see one of the major benefits of farmers working together and making these major attempts and this constant onslaught on this old-fashioned marketing system Smalley gets to see the NFO grow as the NFO holding actions grow bigger so I'd like to call on him to make a few comments on that general area of the NFO's activity and also any other observations he may have Don you know thanks Phil it's real it's a real pleasure to be able to describe some of the organizational effort that has been put out mr. Fairbanks who is the national organizational director has been with the organization since the beginning and has seen farmers all of us that are in the organizational Department our farmers come forward forget about that the old idea that their world ends that they're lying fences and get to looking around a little and see how businessmen operate and then have this desire to put farming on a businesslike basis and we're we don't just produce out there but rather do a little bit about the marketing in including putting on the price tags and all the other concepts of NFO all the other facets FO and it's it's quite an undertaking none of the boys I suppose in the beginning when they joined NFO had the slightest idea that they would ever be gone from home for days at a time or weeks at a time in some cases some cases working several states away from their home but at this time just taking it as a matter of course partly neglecting their farm operation but at the same time turning it over to families or neighbors anyway to keep the home fires burning so to speak but to get this job done to organized enough farmers explain NFO over a wide enough area and give others the opportunity to help in order to get to collective bargaining on the road which of course means contracts with processors explaining the holding actions and so on and I think every organizer in a new area that runs into about the same set of questions no matter if it's here in the Iowa and Missouri where the organization started on up to as far east as Pennsylvania in New Jersey New York and back west into Colorado and Idaho we're just about one state from the Pacific Ocean at this time so it's a vast organization now over 23 states as I say it's heartening of all the to see all the talent develop out there the boys can really think on their feet and after you've mastered learn to answer these few stock questions on surpluses and just the the stock and what are you going to do with a surplus and you can't hold it it's perishable and in a few of these things why it just becomes a pleasure it is an educational program and our boys do a tremendous job of there's one little aspect of holding actions I'd like to inject and this is to many of the farmers that aren't informed on what a holding action is for some have this idea that when a holding action is all that at that point every animal out there in the Midwest is being held well actually some of them aren't held at all till three or four or five weeks long during the holding action because take 50 weeks in a year would mean that approximately 2% of the livestock would come of market weight during a given week this is rounding everything off there are seasonal fluctuations of course but then so that the first week of a holding action 2% the producers of 2% of the annual livestock production have the opportunity to place their production in on the side of the other farmers who are trying to get a price and hold a percent of them do then the second week of a holding action calendar-wise another the producers of another 2% of the annual supply getting up get the opportunity to add their production to the holding action so that by the end of the say 5 weeks of a holding action you've given the producers of 10% of the annual supply the opportunity to place their production with their fellow farmers to try to get a price so a holding action has a building effect and it's not a hardship - back 15-20 years ago I know one thought of selling a hog under two hundred eighty pounds and it always reminds me of the last holding action the one in 1962 in one of the counties I was working in at the time the boys had quite a problem with one farmer out there that was just having terrific problems holding all his hogs were getting big and heavy they were getting heavy every day he just didn't know how they were going to live much longer and the boys had to go out and visit him about every second day or so and encourage him and inform him as to what was going on in the county and then in areas of course news coming in from other areas and that one lasted just approximately a month but at the end of the month hauled his hogs to market they weighed two hundred and seventeen pounds well the man actually didn't hold them at all until probably right that last week of the holding action so these are the problems and the questions that our boys get out in the organizational end of it and the whole thing is to encourage enough farmers to look beyond their line fences and to quit getting asking advice from their friendly livestock buyers or they're friendly Creamery managers and so on who seem to spread quite a bit of anti NFO propaganda we call it and overcome it with a lot of facts and truth and then take it from there because the truth will out and the truth will prevail and this is the basic idea of NFO organizing is to get the information out to enough farmers so that they understand it and then understanding it means that they will be willing to join in fo and support our efforts so this about what I'd have to say on this right this time Phil. Don Smalley in the organization Department of the NFO I've noticed a great contrast this season the whole American public is in the midst of a great debate and all too often we don't discuss the economic facts of the time but farmers are involved in them this is the contrast I'm talking about Packers profits who shot up immensely I noticed that both armor and Swift's profits have jumped from around the seven million dollar range to the ten million dollar range registering percentage gains and profits of around thirty to forty percent the average of all the Packers is increased 47 percent in one year at the same time I noticed the appalling contrast of thirty and forty percent of the farmers in middle western states being below the $3,000 per family money income range now this is an appalling tragic contrast I'd like to ask these gentlemen in the minutes we have left on this half-hour program to discuss this with reference to the responsibilities of a farm organization we see on the one hand immense corporation profits and we also see farmers sinking into the poverty class what about that or at least daily president of the NFO well Phil I think I would just say first that we're not opposed to someone else having profits it's fine this is this is a incentive if the profit motive is what's made America great but the farmers should share in the profits by that I mean they should get a price for their products that do reflect the profitable rate or profitable level and I do have here and if the farmers were living in the Appalachian area if you were under a 3,000 expendable dollars you would income net income why they would say you're in the poverty class but there's 47 one tenths percent of all farmers in the poverty class now these aren't inefficient farmers they already inefficient business men they're just businessmen that are doing a good job of producing but doing the poorest possible job of selling in Iowa the great agricultural state of Iowa 44 and 8/10 percent of the farmers are listed and I'm quoting from statistics that are presented by government statistics 44 and 8/10 percent of Iowa farmers are in the poverty class Phil there's one thing about it and I want the other for us to have an opportunity because we do have a great leadership to tie down a few points but there's a few points I'd like to tie down very quickly number one is this action is far different than any other action it's the determination that has been built in this action there's been efforts of course to confuse the situations our policy as far as violence for example is concerned is very explicit very direct and that is we do not advocate or condone violence but the atmosphere for violence or tempers flaring is created many times for those people 300 miles from where tempers may be flaring I asked the farmers why is it that they will let a buyer convince them that they should sell their production just because that buyer says maybe I can get you another 25 cents 100 they should realize that this is a very same people or the very same person maybe that has got them in the position they are today or somebody that gets on the telephone and calls a farmer up and says why don't you ship today it's a good time NFO's having no effect these people are living off of the farmers and they're living off the farmer as many without performing much of a service for fibers the points that I'd like to then tie down very quickly there are simply this but the responsibility of an organization is to give farmers the opportunity to wage a battle to get fair prices for their products and the NFO is has got one road road to victory that it's falling and that road is right straight down the road with farmers gathering in as we move down the roads towards that complete victory as the strength builds so that the buyers of our products are going to start paying our prices under contract at fair levels and it means that we are going to give the farmers the opportunity in this continuous battle to join with us and the the reasons for these programs are that we are trying to talk to the farmers in their own living rooms giving them the facts so they realize the strength the power they have and the determination and the progress that this organization is making we're going to win how soon depends upon how quick enough farmers make up their minds that they rather have fair prices instead of listening to the buyers who are buying their products at whatever price they want to pay I'd like to direct the next question to mr. Pfingsten the vice-president of the NFO what response do you have to the same situation that everyone's discussing this fall well I think I have to agree wholeheartedly on what Oren Lee says I would like to ask a question how I with of the farmers out there and for that matter of the business people in this audience we're back to the same level parity-wise in our income as we were in 1939 what businessman in the United States or a professional man for that matter could pay the kind of prices or costs that he's paying today and receive in return the same amount that he received in 1939 there is not one business in the United States that could stand that now the question what makes you farmers think that you can do it you to have to have a price you can talk efficiency all you please there is no way on earth of making a profit without a fair price and this is the program of the NFO to help get the farmer a fair price through their own efforts through mutual cooperation and to get that price exactly the same way as every other businessman in the United States gets his by establishing his price and then in forcing the price that he set and there's only one other way to do it well if it doesn't come freely then you have to use the bargaining power you have and that of course is the farm production here in the United States you cut that off and I'll guarantee you you will get a price one of the reasons that these this program is being presented today in discussing the NFO holding action and the temporary suspension with full intention of putting it back on if processors do not bargain in good faith with the NFO I want to close with a note of optimism and the note which I know you have well taken because you have put out immense efforts for the NFO and this includes some people who don't belong these holding actions have grown in size and strength and influence I've been working doing radio and television programs for this organization during each one of these holding actions and I can recall when a test holding action was first explained to agriculture and it affected maybe just a few counties around Corning Iowa and around Omaha and St.. Joseph Missouri the next holding action I can recall affected five states and it was talked about by the newspapers oh they pretended that it had no effect the next holding action affected the 11 states and the one in 1962 was front-page for 32 days this time the greatest of all ran ten days longer than any previous one and covered 23 states and had an immense influence on this marketing system it's also had a number of side effects better enforcement of the Packers and stockyards Act more awareness by all farmers and all buyers of the way this marketing system works and the way the rules have not been enforced you've made good progress now the way to make this thing work and win final victory is to join the NFO work with your neighbors that for today is something to think about