Challenge for Dairymen

Ever since he took over as Secretary of Agriculture, Ezra Taft Benson has been preaching more free enterprise and less Government subsidy--a doctrine that is unpopular among some farmers. This week Ezra Benson brought his message to the American Dairy Association convention in Chicago. In so doing, he put his head boldly into the cow's mouth; a vociferous part of the dairy industry thinks it desperately needs price supports. Benson's case was that price supports are responsible for the industry's present ills and that the dairymen would never solve their problems as long as they relied mainly on supports.

When he took office, said Benson, the Government owned 37 million lbs. of butter, 7 million lbs. of cheese, 56 million lbs. of dried milk. This supercolossal milk bar had been assembled to help the farmer and the industry maintain prices. But what was the actual effect of the Government program? The dairy industry was losing the public market because of "abnormally high prices" maintained by the Government. Benson cited the decline in butter and the use of competitive substitutes such as margarine and other spreads. In ten years, he pointed out, butter sales per consumer had dropped almost one-half. The overall decline in milk consumption was "alarming": the average American now uses 130 lbs. of milk less each year than he used in 1939.

Then the Secretary lifted his sights from dairymen to all farmers who are losing markets through Government-rigged prices. He pointed to cotton (synthetic fibers, such as nylon and rayon, now account for the equivalent of 3,300,000 bales of cotton a year) and to wool ("The public ... has been sold on suits, rugs and other products that contain high proportions of fiber other than wool"). If these price-supported industries had been fighting to hold or expand their markets, they would not have become the victims of such deep inroads from competitors.

For an Expanding Market. "It has become too easy," said Benson, "to merely spend taxpayers' money to bolster markets." He called upon the dairymen to meet the challenge facing their industry, to convert their "problems" into "opportunities," to improve techniques, to cut costs and thereby lower prices, to seek new outlets. "No industry thrives on a shrinking volume of business. We need an expanding, growing market ... If the Government still owns any appreciable amount of butter when 1954 arrives, I hope all of us will frankly admit our failures."

Specific Benson suggestions:

P: "Too many people still think of milk primarily as baby food. Advertising and sales effort need to be broadened to include all people." As a model of what he meant, the Secretary pointed to "the job that the citrus industry has done in expanding the use of juices," and to the equally vigorous expansion of "soft drinks and other beverages."

P: Promotion of sales in such regions as the South, where dairy production is low, and the price of fluid milk almost twice as high as in dairy-rich Minnesota, Wisconsin and adjacent states.

P: More mechanization of dairy farming; for example, "milking direct through pipelines . . . from cow to tank to truck--[the milk] not once handled or lifted."

P: Teamwork by processors, retailers, farm and dairy groups to turn shrinking markets into expanding markets.

"There is no overall surplus of dairy products," said Benson. "Actually, there exists a great shortage of milk to meet our full needs . . . What we have is a lack of adjustment to the markets--so that not all of the butter, cheese and dried milk is being consumed. If the adjustments are made ... the surplus problem will be gone."

For Self-Reliance. The Secretary reminded his audience of his "most difficult decision" to date: his recent order that 90% parity prices for dairy products will be continued until March 31, 1954. He had come to this decision after dairy leaders had promised, if given time, to work out their own marketing program with "minimum dependence on price supports."

Benson put his trust in a conference to be held next month, at which 75 farm and dairy leaders will draft a "plan of action'' to start the industry back on the road of free enterprise and expanding sales.

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