Dragons' Teeth

(See front cover)

Last week in the corn belt, farmers were getting their fields in tilth for corn. In the wheat belt, spring wheat was being seeded --two weeks late because of cold. In the northern half of the cotton belt, cottonseed was going into the ground. In Texas, cotton plants were coming up. On the prairies--save where dust and drought had ruined it--winter wheat was growing green and waving in the breeze. In farmsteads everywhere newly farrowed piglets were lying like pink sausages at the teats of deflated sows. And in Washington, now that May was there, a crop of legislative dragons' teeth, the AAAmendments, were also coming up.

Philosophers' Ring. As farmers watched their growing cotton, wheat, piglets, so the Department of Agriculture watched the progress of its amendments. Chief of those crop watchers in Washington was the overlord of AAA, Henry Agard Wallace, a Democratic Secretary of Agriculture, son of a Republican Secretary of Agriculture, trying his philosophic best to reach the ends his late father, Henry Cantwell Wallace, sought in vain a dozen years ago.

The ring of agricultural philosophers who sit around Son Wallace's chair included year and a half ago George Peek (as AAAdministrator). But Mr. Peek departed after a difference of doctrine with Son Wallace's chief guide, philosopher & friend, Rexford Guy Tugwell. Today Undersecretary Tugwell. chiefly occupied with his part as director of national "resettlement" under the Works Relief Act, is not the foremost member of that philosophical ring. Chester C. Davis, whom the elder Wallace originally brought to Washington to work on the McNary-Haugen plan, is now Son Wallace's chief AAA man. Those two and their aides-- Publicity Man Alfred D. Stedman. AAA Wheat Director George E. Farrell, Assistant Secretary Milburn L. Wilson. Economic Adviser Mordecai Ezekiel--are the executors of what Son Wallace thinks his father would have liked to do.

Deeds. Already they have done things that the elder Wallace never dreamed of doing. Up to the first of April they had:

1) Collected $777,000,000 in processing taxes.

2) Distributed benefit payments for crop reduction of $225,000,000 to cotton farmers, $162,000,000 to wheat farmers, $31,000,000 to tobacco growers, $253,500,000 to corn-hog raisers, $6,000,000 to sugar growers. Total $678,000,000.

3) Spent $191,000,000 buying up crop surpluses, of which the two biggest items were $114,000,000 for drought cattle and $46,000,000 for hogs.

4) Set compulsory limits on the production of cotton and tobacco producers and imposed prohibitive taxes on production in excess of quotas.

While all this was going on, the price of cotton climbed from 8-c- to 11.7-c- a lb.; wheat from 59-c- to 90-c-; corn from 39-c- to 85-c-; hogs 4-c- to 7.8-c-; beef cattle 4-c- to 5-c---national farm income from the neighborhood of $4,000,000,000 to more than $6,000,000,000. Not even AAA claims responsibility for all these gains. Drought and dollar devaluation worked in the same direction.

Of all the basic commodities entitled to crop benefit payments only beef has not been favored. Cattlemen, by nature independent, have not liked giving Mr. Wallace the right to restrict their production, have shied particularly at the means proposed: a processing tax on beef to be used for benefit payments to restrict production of cattle feed.

Other producers who have received in cash their cut of processing tax collections have not only signed up in overwhelming numbers for voluntary crop reduction but voted overwhelmingly for continuance of AAA restrictions. Both cotton and tobacco producers gave whopping majorities for continuance this year of compulsory restriction. Lately corn and hog producers, a million strong (only slightly fewer than last year), voted to continue taking benefit payments for reducing their output. On May 25, AAA will poll wheat farmers on signing up for four years more of government checks. AAA expects to win a great victory in this vote--an opportune victory that may aid the AAA amendments.

Only real grief of the AAA is cotton. In spite of the big votes for the cotton restriction program, cotton is troublesome, because: 1) The cotton textile industry has blamed the 4.2-c- processing tax for boosting the price and cutting the market for cotton goods. 2) The Government, in order to peg the price for cotton, has offered to lend cotton growers 12-c- a lb. on their product, yet cotton prices have fallen below 12-c-. Result: the Government is having to take most of the unwanted cotton in the U. S., has now some 6,000,000 bales on which it has loaned more than the market value. 3) Although the hundreds of thousands of poor cotton farmers joyfully vote for restriction, more economic minded cotton men are not happy.

Sixty percent of U.S. cotton used to be exported. Less than 40% of it still is. Artificial price boosting tempts other nations to increase their cotton production, to displace U.S. cotton with their own in foreign markets. Peru and Brazil have "Did I say that?"-- already increased acreage. The AAA pooh-poohs these beginnings. But Brazil is working hard to increase cotton production. Economic experts from Japan and from an international cotton congress held at Rome are on the way to Brazil and Peru to find out about their new cotton supply. Many a U. S. cotton man was asking, "What good will it do us to boost the price of our cotton and lose half our market?" Congressmen echoed them. Huey Long touched the sore spot in his jibe at ''Lord Corn Wallace": "What does an Iowa corn farmer know about cotton?" Cotton was the Achilles heel of AAA, and AAA knew it. Amendments. NRA was bound to have its troubles with Congress this year for its charter expires June 16 and needs renewal. AAA, terminable only at the pleasure of the President, could go on without Congressional assistance. But AAA dearly wants a bill giving it new powers. In both Houses, the AAAmendments were last week being given a thorough going-over. The three most talked of requests:

1) Permission to pay farmers (for reducing production) not in cash but in crops. Theory of this "ever normal granary" plan is that AAA would absorb crop surpluses in a year of overproduction and the following year contract with farmers to reduce production by a like amount, paying them in kind so that they would have a normal amount of crop to sell. 2) Authority for the Secretary of Agriculture to license processors. Save for "basic commodities" designated by Congress (cotton, wheat, tobacco, corn, hogs, cattle, peanuts, rice etc.), AAA has no power to impose processing taxes and pay benefits for crop reduction. Many other commodities (dairy products, eggs, poultry, potatoes, fruits) are produced regionally, are hard to regulate by such a system. For them AAA has another system: marketing agreements made jointly by producers and processors (usually for regional areas) to guarantee minimum prices to producers and marketing arrangements for their benefit. Great difficulty has been that processors have frequently blocked such action and the courts have upheld them. This amendment would enable AAA to license and regulate all processors of a product if more than 50% of them accepted a marketing agreement--or license them, no matter how few were willing, provided two-thirds of the producers desired an "agreement."

3) Power to examine the books and records of processors. Object: to make them toe the line, cut their margins of profit, give better terms to producers.

Trodden Toes. These amendments, particularly the last two. raised processors in arms. Processors bear no love for AAA's chief tool--restriction of production. Their profits generally depend on the volume of goods they handle. So AAA is basically contrary to their interests.

AAA has many times made it plain that it aimed to force processors and handlers to cut their profit margins, give a bigger slice to producers. Mr. Wallace & aides are fond of recalling the fact that if a case of apples from the Pacific Coast sells for $1.50 in Manhattan. $1.20 goes to the middlemen, 30-c- to the grower; that if a case sells for $1.20, the middlemen get $1.20, the grower nothing. In general, producers have to take the leavings after distributors have pocketed their fee. In the eyes of Dr. Tugwell and other AAA philosophers, the processors and handlers are malefactors of great greed. George Peek, who took a more lenient attitude, was ousted from AAA for that reason. Although Chester Davis and Secretary Wallace are not punitive extremists, processors understand well that AAA's licensing and book-inspecting amendments are aimed to scrape the butter from their bread. And although producers can vote heavily for AAA restrictions, processors are, to Mr. Wallace's grief, capable of making far more noise in the lobbies of the Capitol.

Conscientious Objections. A bigger danger to Mr. Wallace's much desired amendments came from a group of wilfully conscientious members of Congress. Mr. Wallace, when he offered AAAmendments last year and again this year, explained that they were nothing but at tempts to "refine" and "strengthen" the existing law. In Mr. Wallace's eyes, the amendments doubtless are no more, for in his eyes AAA is simply an authorization from Congress to fulfill his father's desire to give all farmers a good price for their products.

But last year and again this year, Sena tor Harry Flood Byrd of Virginia with many backers has sprung up to question Mr. Wallace's contention. For the chief disputed amendments--licensing and bookinspecting for processors--have nothing directly to do with carrying out AAA's program of "balancing" production of cotton, corn, hogs, wheat and other basic commodities. These new powers are for the purpose of letting AAA extend its control over other commodities. AAA answered this charge only in general terms. Said Chester Davis in a broadcast to farmers last month: "Unless the Act can be made fully effective as a national instrument serving the 2,000,000 farmers who grow special crops or milk, then, with support from that group missing, the whole Act is in danger."

Just squeeze a few chiseling middlemen-- AAA officials said that was all their amendments aim to do. But who, asked Senator Byrd; ever heard of a bureaucrat not using all the powers given him? No silver-tongued orator is Harry Byrd but he is an apple grower, the biggest east of the Mississippi, operator of 10,000 acres of Virginia orchards. Said he last fortnight:

"The legislation now requested by the Secretary of Agriculture gives to him arbitrary and autocratic control over the production and distribution of every farm product, perishable or nonperishable. This control will be exercised by the most offensive method--a licensing system where the terms of the license can be fixed by the Secretary, and no one can ship or handle food in intrastate, interstate or foreign commerce without such license. . . . The individual farmer is not mentioned in the licensing clause, yet any farmer who prepares for market or handles for sale any product of his farm, or any association of producers, is subject to a license upon such terms or conditions as the Secretary may prescribe, or the license may be denied by the Secretary."

On the Hill. Significance of Harry Byrd's opposition is that many Senators and Representatives, though not Virginians, not apple growers, not farmers, are like him. They are Democrats who have not been inspired by the New Deal philosophy. The Democratic Party has 69 Senators and 319 Representatives in Congress but the New Deal never had so many. The New Deal's laws have been passed by a combination of the progressives of all parties and by Democrats loyal to the New Deal because it bears their party label. Many a Democrat has put party loyalty above his own convictions but today such loyalists as Vice President Garner, Senators Joe Robinson and Pat Harrison find it hard to hold together the coalition of New Dealers and Democrats. For at heart the biggest bloc of Democrats still prefers states' rights to centralization of power. Last week's debate on the anti-lynching bill reminded them again. The slowing down of legislation in the 74th Congress can be traced to the unwillingness of Democratic Congressmen to vote the New Deal such power as the AAAmendments.

Only Carter Glass had the strength of conviction to oppose the New Deal from the start. Harry Byrd, slower moving, stood by the President through the first year of the New Deal, doing such unpleasant political chores as reducing pensions of veterans, the salaries of Federal jobholders (many of whom live and vote south of the Potomac, are Mr. Byrd's constituents). But last year when the AAAmendments first came up, he balked. He led the fight that kept them from passage. Before the summer was out he moved over into the camp of his fellow Virginian Carter Glass. "There is enough of Thomas Jefferson left in me," said he. "to insist that . . . no Federal official shall invade or ignore the Constitutional rights of the individual citizen." Last week light-hearted Virginians crowned Miss Nella Veverka, daughter of the Czechoslovakian Minister to the U. S., queen of the Shenandoah Valley apple blossom festival, and light-hearted Tennesseans made ready for Memphis' annual Cotton Carnival with William Nedy Mallory (All America football captain of Yale,1924) as King. But Congressmen were less lighthearted. They could see in their minds' eyes Harry Byrd handing them a ballot reading:

How much Thomas Jefferson?

How much Henry Wallace?

Stumbling Block. Superficially the circumstances that made Henry Wallace what he is--he spent his youth helping his father make a country paper succeed--are like the circumstances that made Harry Byrd into Henry Wallace's chief stumbling block. The Byrds are a Virginia family ancient as any, but Harry's Father, Richard Evelyn Byrd Sr., a successful criminal lawyer, made unsuccessful investments, died poor. He left three sons, Tom, Dick and Harry. Tom grew up to be an apple grower. Dick was regarded as something of a sissy and in the course of time developed an uncommon interest in the North and South Poles. Harry likes to record that at the age of 15 he was a newspaper publisher, farmer and apple grower. His paper was the Win chester Evening Star which had a circulation of 700 or 800 and a much larger debt. He persuaded the paper's creditors that he could make the paper pay its way, and he did. He got similar results with his farms and orchards. The job of doing so made him what he is: pink-faced, sober and. more significant politically, a believer in economy and budget balancing.

His political tutor was his uncle, Henry De La Warr Flood, who in Woodrow Wilson's time was Chairman of the House Foreign Affairs Committee. In the same era Harry Byrd was a freshman in the Virginia State Senate. He did not smoke and he did not drink (to this day his good natured brother Tom generally takes two drinks when they are passed, saying, "this is mine and this is Harry's") and he was not spectacular. But the time came when he led the Democrats in the State Senate and soundly trounced C. Bascom Slemp's Republicans. Finally in 1925, he was elected Governor and gave Virginia a new deal--of the kind he had given his father's newspaper as a boy.

He had Virginia's ancient constitution completely made over, reduced the number of departments in the state government from 100 to 12, revised the tax system so that farmers in Virginia now have lower taxes than in almost any other state, insisted on a pay-as-you-go system of highway building, increased the mileage 45%. When he took office Virginia had a deficit of $1,368,000. When he left office after four years, he left a cash surplus of $4,256,000.

In 1933 when Franklin Roosevelt was inaugurated, Senator Claude Swanson went to the Cabinet. Promptly Governor Pollard of Virginia named Harry Byrd to the Senate as colleague of Virginia's perennial Carter Glass. No state ever had a happier team of Senators. By age, by admiration for each other's virtues, they might be father and son. But they are not a happy combination for the New Deal, for today they rally the Jeffersonian away from New Deal Democrats. Every time Henry Wallace or another New Dealer asks more power, the Democratic-New Deal coalition shakes from stem to stern. If it ever breaks in half, a big slice of the Democratic Party may go sailing off with Mr. Glass and Mr. Byrd.

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