A Hard Row to Hoe
(See Cover)
Agriculture Secretary Orville Freeman speeds to the Pentagon, leaps out of his limousine, and rushes into a basement locker room, ripping off his tie as he runs. Down the stairs bounds Defense Secretary Robert McNamara, unbuttoning his shirt on the way. Within minutes, the two have changed their clothes and are on the squash court, engaged in a fierce, relentless competition. "One of these days," remarked a spectator at a recent match, "we're going to find both of them stretched out on the floor dead."
Freeman is a furiously aggressive player, flailing at the ball as if it had done him some unforgivable injury. McNamara, a sly tactician, often insinuates his body between Freeman and the ball. When he does, the Secretary of Agriculture swings away at the Secretary of Defense--and Freeman is unapologetic about McNamara's resulting bruises. "Bob won't get out of the way," he says, "so what can I do? I gotta get my shot." Despite Freeman's determination, McNamara wins about three games out of every five, and Freeman walks off the court muttering disgustedly: "Aw, shucks!" But a couple of days later, he is back for more.
In these matches, Orville Freeman, 44, displays qualities useful to any U.S. Secretary of Agriculture--an all-out combativeness coupled with the ability to lose, mutter "Aw, shucks" and return to the fray. For Freeman's job is the most thankless in the U.S. Government. Freeman's predecessor, Republican Ezra Taft Benson, called it a "monster" and a "sordid mess." For 30 years, the Federal Government has been ineffectually wrestling with the ever bigger surpluses produced by U.S. farmers. In the process, the Agriculture Department has spent many billions of dollars, piled up huge stocks of surplus farm products, and entangled U.S. agriculture in a fantastic web of controls.
"Don't Let Them." Understandably, Freeman did not want the job. After Freeman was defeated in 1960 for a fourth term as Governor of Minnesota, his friend Senator Hubert Humphrey assured him that he would get a high post on the New Frontier--possibly Secretary of Agriculture. "I don't want to be Secretary of Agriculture," Freeman pleaded. "Don't let them make me Secretary of Agriculture." But that was the job Freeman was offered--and that was the job he took. Ever since, he has been working at it with all the desperate intensity of his nature.
Freeman has a bulky domain to administer. Its budget, about $7 billion a year, is more than twice the combined expenditures of the Commerce, Interior, Justice, Labor and State departments. As of last January, a relatively slack time for Agriculture, the department had on the payroll 96,104 employees. Of these, only 11,807 were stationed in the District of Columbia and environs. The remaining 84,297 were scattered among thousands of outposts in the 50 states and numerous foreign countries. The number of farms and farmers in the U.S. keeps declining year after year--but the number of Agriculture Department employees keeps right on growing. In the House of Representatives last year, Michigan Republican Robert Griffin jokingly offered an amendment to ensure that "the total number of employees in the Department of Agriculture shall at no time exceed the number of farmers in America." It lost--but only by 230 to 171.
Schizophrenia. The Agriculture Department defies tight administration. A report of the Hoover Commission on government reorganization called it "a loose confederation of independent agencies." The department's two main buildings in Washington contain a total of 4,844 rooms, eight miles of corridors. While Benson was Secretary, a counterfeiters' nest, complete with press and plates for printing bogus money, was discovered in one of the department's rooms. A sort of schizophrenia pervades the whole Agriculture Department atmosphere. Much of the department's funds and energies goes into trying to cope with overproduction--but agriculture also strives diligently to increase farm production through research. Back in 1950, Congress asked the Agriculture Department what it was up to in the way of research and "related services." It took the department five months to produce the answer--in three hefty volumes totaling 2,729 pages.
Out of past Agriculture research projects have come frozen orange juice and instant mashed potatoes, stretch-cotton fabrics and machine-washable woolens, cheaper penicillin and longer-lasting blood plasma. Projects now in the works promise a wild-green-yonder of even greater farm abundance--and, of course, threaten bigger surpluses. The department's scientists are breeding new, higher-yielding varieties of wheat; they are trying to devise ways of making grain crops and grasses add nitrogen to the soil instead of subtracting it; they are combatting the boll weevil and other crop-destroying insects by sterilizing male insects in laboratories, then releasing them in the fields to compete with other males for the available females. The U.S., says an Agriculture Department publication, is "in the foothills of technical progress in agriculture--not at the peak."
The department interprets its research franchise broadly, and sometimes it gets pretty remote from workaday farming, as in the project to breed a more compact poinsettia. Agriculture offers all sorts of curious jobs. In a basement laboratory in Washington, ten men gather every morning and solemnly taste samples of reconstituted powdered milk, grading each sample according to a long list of categories: acid, astringent, bitter, chalky, cooked, foreign (objectionable), foreign (unobjectionable), metallic, oily, oxidized, rancid, salty, scorched, stale, weedy, etc. The results go onto IBM cards. "It's tedious, elaborate and expensive," admits Michael J. Pallansch, director of the project. "But so long as we work with people as our principal tasters, we're going to have that problem. We'd like to eliminate human tasters. They fluctuate, in a biochemical sense, every day." Despite his dissatisfaction with human tasters, Pallansch added a cheerful note. "We're the happiest people in the department," he said. "The cheese group used to have a good time, too. but they've been switched to strontium 90."*
The Happy Ones. The world is Agriculture's oyster (as a matter of fact, the department has done research into the chemistry of oysters). Among other things, Agriculture oversees the national forests, inspects and grades meats and other foodstuffs, guards the nation's borders against harmful insects from abroad. Last year, Agriculture proudly reports, its quarantine teams inspected 60,000 ships, 64,000 railway cars, 137,000 airplanes, 25 million road vehicles, 23 million pieces of luggage, 40 million incoming packages, and in the course of their search apprehended 33,000 specimens of diseased flora and harmful fauna.
One result of all this activity is a torrent of printed matter, as the department eagerly communicates its findings to the people. It takes a 104-page catalogue just to list the books and pamphlets and bulletins available. Another result is that the Agriculture Department has acquired a reputation for being ready to tell anybody how to do almost anything, and the daily mail brings thousands of requests for information. Samples:
>"Please forward any information you have concerning the propagation of the turkey. Does the goose have anything to do with it?"
> "Could you please send me information on the conservation of extinct plants and animals?"
> "I am interested in a booklet on buying a tombstone."
> "Please send me any material about anything."
The Peaceable Revolution. Freeman's bureaucratic beanstalk grew from a very small seed. Henry Leavitt Ellsworth, first head of the Patent Office, was keenly interested in agriculture, and in 1839 he managed to get from Congress an appropriation of $1,000 to distribute new plants and gather agricultural statistics. Agriculture remained a division of the Patent Office until 1862, when Abraham Lincoln signed a bill establishing a separate department under a Commissioner of Agriculture.* Lincoln said that Agriculture was "peculiarly the people's department, in which they feel more directly concerned than any other." Since about 60% of Americans lived on farms in those days, Abe had a point. Agriculture Secretary Freeman is fond of quoting Lincoln, although today less than 9% of the U.S. population lives on farms.
The mission of the early Agriculture Department, untroubled by overproduction, was beautifully clear: to apply science to the task of increasing the output and efficiency of U.S. farms. And if output and efficiency were the only measure, the result would be spectacular. A century ago, the average U.S. farmer produced enough food and fiber for 4.5 persons. That figure increased over the years, and by 1940 it had reached 10.5. Then the demands of World War II brought an explosion in productivity. By 1950 the average farmer supplied the requirements of 14.5 persons. That figure has since nearly doubled: it now stands at 27.
The revolution in U.S. farming has been largely a result of the science and technology promoted by the Agriculture Department: new types of machinery, higher-yielding varieties of plants, improved breeds of livestock, more effective pest control, greater use of chemical fertilizers, more efficient methods of handling and storing crops. But the revolution has also partly resulted from shifts in the structure of farming in the U.S.--toward bigger farms with far greater capital investment. Since 1940, average investment per farm in the U.S. has increased eightfold, from $6,000 to $48,000. As a result of the combined workings of science and investment, it takes only 15 man-hours of labor to produce 100 bushels of corn in the U.S. today, as against 135 man-hours half a century ago.
Blessing a Burden. In a world in which millions still exist in hunger, the abundance of U.S. agriculture is in one sense a blessing. And Secretary Freeman keeps preaching that the people of the U.S. ought to regard their agricultural abundance not as a problem but as a "smashing success." As a result of that abundance, he argues, food is cheap in the U.S. Since the late 1940s, retail prices exclusive of food have gone up more than 30%. Over the same span, retail food prices have increased only 13%. This moderate rise in food prices reflected increased processing and distribution costs; prices received by farmers actually declined during the 1950s, and have only slowly inched upward under Freeman (see chart). The average U.S. family spent 26% of aftertax income for food 15 years ago; today food takes only 19%. Says Freeman: "This is the smallest share of income spent for food by any people, anywhere in the world, at any time in modern history." In contrast, expenditures for food take 30% of the average family's income in Britain, 45% in Italy, more than 60% in Russia.
But abundance has brought staggering burdens along with its boons. Rising farm productivity has led to oversupply. To cope with it, the U.S. Government maintains a costly, creaky apparatus of price supports and production controls. "Our agriculture system," Freeman once conceded, "is on the one hand a miracle and on the other hand a mess."
Created during the Great Depression, the support-control system is much the same as it was in the New Deal days, only bigger and more complicated. In its current operations, the Agriculture Department uses a device called "crop loans" to support prices of wheat, cotton, rice, tobacco, peanuts, corn, oats, rye, barley, and a few other storable crops. Within certain restrictions, a farmer has a right to place all or part of his crop in certified storage and get a Commodity Credit Corp. loan on it at the support price. Later the farmer may repay the loan, reclaim his crop, and sell it on the open market. Or, if he finds that the market price is lower than the support price, he can simply keep that loan and, in exchange, assign the stored crop to the CCC. That is what happens to about two-thirds of the stuff on which farmers get CCC loans--the Government, and thereby the taxpayer, gets stuck with it.
There is another side to the program. To keep from being completely inundated with surplus farm products, the Government, in sheer self-defense, imposes production controls. The principal instrument is the acreage quota: the farmer is assigned a certain number of acres of a given price-supported crop; his quota depends upon how many acres of that crop he has grown in the past. Despite such controls, the surpluses keep piling up.
Some of the surplus is sent overseas in exchange for soft currencies and strategic materials. Some is simply given away, abroad and at home, through Food for Peace, famine relief, school lunch, and aid-to-the-needy programs. Despite these openhanded disposal efforts, the CCC still has so much produce that the handling and storage costs alone amount to roughly a billion dollars a year. The CCC's inventories (not counting the farm products stored under current crop loans (include 972 million bu. of wheat, 712 million bu. of corn, 4.7 million bales of cotton, 484 million Ibs. of dried milk.
Cotton Comedy. On paper, the support-control system has a semblance of logic to it. In practice, the system has functioned as clumsily as a bull on stilts.
The cost to the taxpayer is, of course, enormous--running to $4 billion or $5 billion a year if surplus-disposal programs are included. Acreage controls, as the CCC's massive inventories show, are ineffectual. Merely by planting crop rows closer together and dumping on more fertilizer, the farmer can increase his yield per acre. The support price gives him an incentive to do just that. It provides a built-in impetus to production, so that a support system set up to deal with oversupply tends to perpetuate the problem.
Another unseemly consequence of the system is that it prices major U.S. farm products out of foreign markets. For example, all U.S. exports of wheat and cotton are subsidized by the taxpayers: the Government pays the exporter the difference between the U.S. support price and the world market price. The Endsville of this odd arrangement is the cotton comedy. The CCC supports the price at 32 1/2-c- a Ib. But the going world market price is only 24-c---so the Government pays exporters an 8 1/2-c- subsidy. As a result, foreign textile firms can buy U.S. cotton cheaper than U.S. textile firms can. Reaching a point of gimmick-on-gimmick absurdity, the Administration now proposes to balance things up by giving U.S. textile makers a subsidy on the domestic cotton they buy.
Moving Again. Hope, springing eternal, argues that the farm mess will somehow, some day, just go away. Maybe the growth rate of the U.S. population will catch up with farm output, perhaps export markets will open up and swallow the surpluses. But projecting present trends, the Agriculture Department foresees farm capacity running ahead of population growth until 1980 and beyond. And export markets for U.S. farm goods may well narrow in years ahead: Europe's Common Market, customer for nearly half of U.S. farm exports, is building tariff walls against agriculture imports.
Freeman did not create the mess. He inherited it. So had his predecessor, Ezra Benson, who for eight years fought the support-control system tooth and nail. Measuring aims against results, Benson's performance was a grotesque failure: instead of cutting the costs of federal farm programs, Benson saw them soar dizzyingly. But he did achieve one significant success. He persuaded Congress to abandon high, rigid price supports in favor of an arrangement under which the Secretary of Agriculture has authority to shift the support levels up or down within specified limits. Benson thereby nudged federal farm policy in the direction of lower support prices, fewer controls--and greater freedom.
Then John Kennedy got elected President and turned the farm mess over to Orville Freeman. Under Freeman, farm policy got moving again--back toward higher supports and stricter controls.
Freeman readily admitted soon after taking office that he was not a farm expert. He had worked on a farm during the summers as a boy,* and he had been Governor of a state with a lot of farmers.
That was the extent of his special qualifications. Says an official of a U.S. farmer organization about Freeman: "We've never had a Secretary, or even an Under Secretary, who knew less about agriculture when he came in.'' But Freeman nevertheless threw himself into the job with a vengeance.
Bromides & Briefcases. People are sometimes misled by Freeman's prissy first name. "Orv's tough," says Secretary McNamara. "Orville is a man," says Bobby Kennedy. "He's a bulldog," says a member of Congress. Says Freeman himself: "I admire two-fisted people. Pussyfooting around doesn't appeal to me." Though he is a city boy, Freeman sometimes seems a bit homespun by New Frontier standards. His speech is sprinkled with harmless little bromides such as "You can't get halfway up a hill--you got to go all the way." His favorite movie fare is gunsmoky westerns.
Even among the energetic young men of the New Frontier, Freeman is notably diligent. He gets up at 6:30 every morning, starts the day with nip-ups, and is sitting at his desk by 8. When he leaves the office in the evening, he carries home two briefcases. He had a little office built in the basement of his suburban Maryland house, and after dinner he goes down there and pores over the contents of the briefcases until midnight. Sunday is the only day he reserves for his family: Wife Jane, Daughter Constance, 17, and Son Mike, 14. Freeman's hard-driving pace has brought him an ulcer and a spastic colon, and he sips milk and buttermilk at his desk to quiet his innards. Occasionally a spasm comes upon him, and he has to lie down on a couch in his office, rigid as a rake handle.
High-Flying Kite. Freeman has always been a hard driver. His father, proprietor of a men's clothing store in Minneapolis, went broke during the Depression, and when the time came for Orville to go to the University of Minnesota, he had to work his way. He made Phi Beta Kappa and magna cum laude, played football, served on the debating team and got elected president of the university council. After graduation, he went to law school and, in 1941, to war.
In 1943, on the South Pacific island of Bougainville, a Japanese bullet came within a couple of corpuscles of ending his life at 25. A Marine first lieutenant, Freeman was leading a combat patrol of about 30 men through thick, enemy-rife jungle. From behind a tree about 40 ft. away, a Japanese soldier shot Freeman in the jaw. The bullet ripped through his throat, passing between the jugular vein and the carotid artery. Doctors doubted whether Freeman would ever be able to talk normally again, but he went through a prolonged course of speech therapy and, being an exceedingly determined man, developed into a strong-voiced orator.
After military service, Freeman went back to law school--and politics. In his political career, Freeman tied himself to a high-flying kite named Hubert Humphrey. Both visceral liberals, the two met as undergraduates at Minnesota. Humphrey was seven years older--he was continuing an education interrupted by the Depression--but they became close friends. A far more talented politician than Freeman, Humphrey got elected mayor of Minneapolis in 1945 at the age of 35. He appointed Freeman to a couple of city jobs. In 1950, making his first try for public office, Freeman ran for state attorney general and lost. In 1952 he ran for Governor and lost again. But in 1954 the kite was flying high. Humphrey, running for re-election to the U.S. Senate, carried Freeman into the governorship. Once in, Freeman won re-election in 1956 and 1958.
He was an able administrator, but he ran into a political difficulty that has afflicted many another liberal Governor. He increased state spending for health, education and welfare. That made him popular. But then he had to increase taxes. That made him unpopular. In 1960 Kennedy carried Minnesota by an eyelash, Humphrey easily won re-election to the Senate, but Freeman, running for a fourth term, lost to Republican Elmer Andersen by 23,000 votes.
Well, It's a Job. After his defeat Freeman looked toward Washington. His first preference was Attorney General, his second was Interior, and he would have been satisfied with Deputy Secretary of Defense. But the real consolation prize, when Kennedy finally telephoned him, was that miserable Agriculture job. Freeman accepted.
Since then, Freeman's tribulations have rivaled Ezra Taft Benson's. Congress knocked down his early legislative proposals. Then there was the Billie Sol Estes scandal (TIME cover, May 25), which brought the dismissal of three Agriculture officials and exposed a looseness in the administrative structure of the department. Freeman has tightened it up a bit, created the new post of inspector general to look over bureaucratic shoulders. "But where you've got an organization as big as this one," admits a high Agriculture official, "I wouldn't want to say it could never happen again.''
The weather has also made trouble for Freeman. Last year was exceptionally favorable for crops. And for the U.S. Secretary of Agriculture, good crop weather is bad news, betokening bumper surpluses. Although farmers planted the smallest acreage since the Agriculture Department started keeping records, total crop production matched the alltime peak reached in 1960. For a while last winter, it looked as if dryness in the Midwest might hold down 1963 harvests. But moisture conditions have improved, and with Freeman's high support prices tempting them, the biggest harvest in history is looming ahead.
"A Mutual Thing." Against this dismal prospect, Freeman is pushing his policy of "supply management." That policy is designed to trim the burdensome farm surpluses and increase farmers' incomes. The basic ingredients: 1) drastic controls to reduce the acreage planted with problem crops, and 2) Government payments to farmers for the acres they leave idle or divert to nonproblem crops. If everything works according to plan, the farmer's gross income goes down, but his net goes up because he gets income from those diverted acres without incurring any production costs.
The guiding genius of the supply management approach is not Secretary Freeman but Willard Cochrane, 48, a professor of agricultural economics on leave from the University of Minnesota. Cochrane was Governor Freeman's agricultural adviser back in Minnesota. When Freeman went to Washington, he took Cochrane along as director of agricultural economics. As Cochrane sees it, price supports make stringent controls inescapable. "We offer the farmers price supports in return for cuts in production." he says. "It's a mutual thing. If they don't want effective controls, that's their prerogative. They can vote them out any time they choose. But it's not fair for them to ask for prices at present levels if they are not willing to assume responsibility for cutting production."
Unpromising Start. Secretary Freeman's first important official act was to raise price supports on cotton. That was a highly unpromising start. By upping the support level, Freeman widened the gap between the U.S. price and the world price, worsened the competitive disadvantage of U.S. textile makers. His next step was to raise price supports on dairy products. With the milk-butter-cheese glut worsening, Freeman has since retreated and lowered the dairy supports. His current program for dairy products consists of trying to promote the consumption of milk by persuading the President and New Frontier officials to be photographed drinking it. As for himself, Freeman gulps gallons of milk a week.
Supply management got a critical test last year in Freeman's new program for corn, barley and other "feed grains" (so called because they are mainly grown for livestock feed). Freeman raised feed grain support prices. But in order to qualify for crop loans, farmers had to cut their feed grain acreage by at least 20%. Farmers who did so received "diversion payments" equal to 50% of the value of the crops they would normally have grown on the diverted acres. A similar feed grain program, with lower diversion payments, is in operation again this year.
Freeman claims that his 1962 feed grain program was a "dramatic success." He points to sharp drops in the CCC's inventories of corn and other feed grains. That claim is sharply disputed by President Charles Shuman of the National Farm Bureau Federation, biggest of U.S. farmer organizations. Freeman's 1962 feed grain venture, says Shuman, cost about $768 million in diversion payments, with additional expenditures for higher price supports and extra administrative expenses. For its money, argues Shuman, the Agriculture Department got too little: the farmers participating in the program increased their per-acre yields so effectively that the overall drop in feed grain production amounted to only a small percent. The reduction in CCC feed grain stocks, Shuman adds, was largely a result of a surge in livestock production, which used up a lot of feed. As Shuman reckons it, the program "nailed the American people for a billion-dollar loss."
"The Most Momentous." "I know what I'm doing," says Secretary Freeman. "And I know it will work." But a lot of farmers appear to be far from sure of that. Western cotton farmers are bitterly unhappy about being priced out of potential markets. Polls among Midwestern farmers have shown a steep drop since 1961 in their opinion of Freeman's performance. And the taxpayers cannot be enthusiastic either: the Agriculture Department's total expenditures for fiscal 1962 and 1963 amount to an estimated $14 billion, a new peak for any two-year period.
Next May 21, U.S. wheat farmers will hand down their verdict on Freeman's supply management approach. For the 1964 wheat crop, Freeman has proposed a complex plan involving a compulsory cutback in wheat production. Each farmer's quota would be translated into bushels as well as acres. This approach would forestall the yield-per-acre boosts that have defeated acreage controls in the past. But it will also greatly complicate the operation and enforcement of the plan--acres are much easier to keep track of than bushels. It is up to the wheat farmers to decide whether to accept the plan: if two-thirds of them vote yes, the plan will be mandatory for all wheat growers. If the plan fails to get a two-thirds majority, the support price will drop from $2 a bushel to about $1.20. For the first time, the "15-acre" growers will be eligible to vote in a national wheat referendum. Until now, farmers growing 15 acres or less of wheat have remained outside the support-control system. Freeman wants to bring them under the new plan, making them subject to acreage cutbacks and other controls.
Freeman has repeatedly said that the issue before the wheat farmers is a simple choice between $2 wheat and $1 wheat. To many farmers and farm leaders, the vote has turning-point importance. President James Patton of the pro-Freeman National Farmers Union says the referendum has a "symbolic" significance. The Farm Bureau's President Shuman says that the wheat farmers will be making "the most momentous decision ever made by a commodity group with respect to the direction of American agriculture."
Device of Persuasion. As Shuman sees it, the wheat farmers will be deciding not between $2 wheat and $1 wheat, but between more controls or more freedom.
Many farmers are convinced that Freeman's stark $2 v. $1 alternative is unreal. Congress, the argument runs, would not permit anything like that drastic a drop in wheat prices; if the Freeman plan loses, Congress would enact a substitute wheat program. Accordingly, the argument concludes, wheat farmers can declare their verdict on supply management without fear of being ruined if the referendum goes against Freeman.
With the resources of the Agriculture Department behind him, Freeman is striving to persuade wheat farmers to vote yes. He has enlisted the Farmers Union, the National Grange and several smaller farmer organizations to help him. Shuman, battling hard against Freeman's plan, says he is sure it will lose. Freeman, says Shuman, has "failed to recognize that farmers want to move increasingly toward the market rather than toward greater restriction and control by Government."
Preparing himself against the possibility of defeat, Freeman keeps saying that rejection of his wheat plan would not bring any change in his policies. But if Freeman loses, Congress may decide that the time has come to re-examine the entire support-control system. Then, perhaps, U.S. farm policy will get moving, however slowly, in the direction of freedom.
* Working on techniques for removing strontium 90 from milk.
* The first commissioner, a Pennsylvania dairy farmer named Isaac Newton, became a martyr to the cause of agricultural progress. One summer afternoon in 1866, he noticed that a storm was gathering, hurried to the department's horticultural garden to rescue some experimental wheat specimens that had been cut but left outdoors. Bustling about in his top hat and frock coat, he suffered a heat stroke from which he never fully recovered.
*It was a 280-acre general farm once owned by Freeman's uncle. Freeman inherited a one-fifth share, which brings him about $400 a year in income. A tenant, Arnold Gills, operates the farm "on halves," and Freeman carefully refrains from offering him any advice. The farm is not enrolled in any of Freeman's production-control programs. "I can't afford it," says Gills. "I got to grow all I can."
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