Freedom at Work

The U.S. last week got a prime--and lately rare--example of how a free market can work to the benefit of consumers. The Administration, which has been talking of curbing such freedom, also benefited; it found that there may be more grain available than it had counted on.

It started when the Government decided on this year's quota of grain for export: 570 million bushels, 100 million more than it could readily get. As the Government bought on the open market, prices rose. Many livestock raisers, rather than pay such high prices for feed, sent their animals to market and cashed in on high meat prices. Thus at twelve leading Western markets, hog receipts one day last week totaled 114,800, as compared with 67,987 on the same date a year ago.

Down Meat. Such heavy receipts had caused wholesale pork prices in New York and Chicago to drop an average of 20% since the end of September. Since mid-September, the American Meat Institute reported, all wholesale meat prices had dropped 3-c--18-c- a pound. Retailers have been slow to cut prices accordingly. But livestock slaughter is expected to run high until year's end--the packers' busy season--and its effects were bound to reach housewives fairly soon. (Whether the lower prices would remain when slaughter tapered off was anybody's guess.)

More important was the effect on grain. The Government had estimated that 350 million bushels would be needed for livestock feeding this crop year. But the heavy slaughter had cut livestock feeding in the third quarter of this year a third below estimates. So last week the Department of Agriculture lowered its feed estimates to 250 million bushels. Thus, if the Department was right, the grain saving which the Citizens' Food Committee was working toward with such confusion (see NATIONAL AFFAIRS) would be effected by the reduction in livestock feeding.

Up Wheat? This seemed to put a damper on the grain market. The Bureau of Agriculture Economics last week predicted that farm prices would not drop until 1949 or 1950. This was the kind of governmental talk that had been booming up the grain markets. Yet commodities, which had been slipping, were little affected.

Part of the sluggishness may have been due to a change in Government buying and shipping policy. In the past the Government has frequently committed itself to export large amounts of wheat at one time, then crowded the market--and thus forced prices up--to meet its commitments. Recently the Department of Agriculture won out on a plan of comparatively small, regular shipments (about 30-35 million bushels a month until next spring). Unless the winter wheat crop, which got off to a poor start, fails badly, the Government should have grain on hand to tide the U.S. over.

If there was still any doubt that U.S. farmers were holding back vast amounts of grain for even higher prices, it was dispelled last week by Thomas D. Campbell, the world's largest wheat grower.

Onetime agriculture missionary to Russia (in 1929) and Great Britain (in 1941) by Government invitation, white-haired, dapper Tom Campbell owns huge wheat acreage in Montana. On a visit to the White House, Campbell told President Truman that he was withholding all of his current crop--some 610,000 bushels--because he wanted to get as much as he could for it. One way to get farmers to sell, he said, was for the Government to peg the price of wheat at about $3.50 a bushel, some 50-c- above the current price. The President said he didn't blame Campbell for holding on to his wheat.

Long-suffering consumers, having berated Big Business for high profits and Big Labor for high wages, could now fire on a third target.

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