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You have our experts here at the table.

They have a lot of answers for you.

All right.

We have a moderator here.

I still don't know what to say to you.

We reviewed some of the current situations where we were in the waste price freeze.

I also talked about some of the international events, but I think each other would like to make a brief statement to you.

Good.

And I thought about which order I should start in, and it went well, evidently.

Or, I noticed a condition in this room, as you go according to the date the agency was established.

Oh, I tried on that basis.

I'm going here.

Since we already have the room, call John Scott.

The green is the oldest of the farm workers.

I didn't have a rep on that.

On that, yes.

It was before the... Actually, that's what it is.

Yeah, the Grange was a fraternal group.

It's the beginning of it.

Still, it still is.

It's a guy who attended strange meetings.

We go in, and it's really a lot of fun.

It's very social.

It's fraternal.

It's very close.

All right.

Well, I'll let you know.

Secretary Harding.

So...

workers in government and in agriculture.

We're deeply honored, Mr. President, to be asked to be here today, and we want to compliment you just to the utmost for the action.

We realize that the greatest study in this country has been this inflation that we've had, and it's been increasing, and it lends wages and price to increase in relation to productivity on the destination today.

And we're

We have strong support of the direction of the economic policies that the last few weeks have taken.

We are concerned that, I don't believe we will improve, but we will improve, including the dollar, tax evasions, and closing of the gold window, and the surcharge, too.

We firmly believe that they will have lasting benefits on the economy of this nation.

And needless to say, we were a little bit alarmed when you announced that the freeze would end at the end of 2019, but we also realize that it continues to freeze, as it is, beyond that time.

Quite a whole lot of us.

And so, I'm sure we'll support any program that you continue this leveling off of our economy.

We also greatly appreciate the fact that you exempted drive to freeze

The important feature is that this demonstrates that the administration realizes that farm prices have not contributed to inflation.

And with only our 7-8% increase over the last 20 years compared with the increase of the other segments of our economy.

And we've been able to maintain full production and increase emissions, and the increased emissions we've had has been able to force us to stay in business.

But placing a ceiling on the end price of an agricultural product after a process, I'm sure that I don't need to tell you that puts also a downer pressure on the raw agricultural product, the price of it.

And with this in mind,

I think, Mr. President, that the Grange feels that perhaps in your new program, there might need to be some method of placing some floors under some raw products.

Because there could be increased costs, the process report distributor might, their transportation might fall, and maybe force these raw product prices down, even though they weren't grossed.

Negotiated highway is not supported by increased productivity and plays pressure on prices.

And of course, as far as the wage price, power, inputs and prices proceed unrelated to efficiency or productivity, we feel must be controlled.

We are to have a stabilized economy.

The national range has long held that government and gold should be a minimum, but they are necessary to provide equitable opportunities for all Americans.

So certainly American agriculture cannot continue to function as the only brake on inflation.

We must have help from government and the rest of the business complex to bring about the necessary controls to the economy that will lead to restraint upon waste and price in industries that have allowed their efficiency and productivity to be outstripped by crime.

It would be immediately likely to know the economic effect upon the economy if farmers had to be compensated in proportion to their economic efficiency.

Perhaps it would have forced other industries to increase their own efficiencies and productivity, and justify their increased prices and wages.

Instead of relying upon agriculture,

The supply of the necessary gluten fiber was the decreasing percentage of their expendable income, which they have done in the past.

People have been able to buy more of other products because they've had to spend less for their gluten fiber, because we have been taking less and less of their expendable income.

As I said before, Mr. President, we have appreciated the opportunity to express our views, and we do pledge our support.

I think that what you have done so far has called attention to this real inflationary problem to every citizen in this country, and that you have already placed many dampers on inflation at the psychological level.

...feeling that prices must go up and wages must go up has already been brought up.

And we hope that the new program will continue this stabilization.

The wages...

I mean, you have a car invite, and so you say that you're freezing the products, and when it's still there, you just can't realize what you're trying to do.

On the wage side, of course, I suppose that to a certain extent, your wage patterns would also be somewhat volatile, because you do not have an agriculture that you do in, say, manufacturing, in negotiating contracts and so forth.

What do you hear about wages?

Do they hold down health in the last 30 days?

Or, I'll go this way, a category of plants in agriculture?

No, I think that there's, it's almost remarkable that the amount of voluntary restraint people have accepted for this 90-day period.

And you're both being the workers in agriculture, most of whom are not organized, generally respected.

Would you all agree with that, that you find it necessary?

Because we have a special problem with the season record, and the policy of the council on adjusting seasonality, I think is critical to care for that.

Well, I think one addition that might be made here is the significance of some of the polls that are taken among neighboring people.

Even though their president was denouncing some of the actions, their people said that 70% of them said that we favor this, and I think this is a real sign of concern and defeat.

Yeah, well, actually, the wage earner, and particularly the wage earner's wife and kids, the budget is highly price conscious.

Even more so sometimes than the person who lives on dividend.

Retired people, of course, are highly price conscious.

Particularly the wage earner.

They're going up, they're raising kids, they're saying, you know, trying to save their education.

Dr. Bill boots for students and all that sort of thing.

Fine, well, thank you.

Thank you.

Mr. President.

I'm in somewhat of a safe spot that Senator Pearson found himself this one time.

He said that before a committee was testified, that it would take 18 minutes to summarize his statement, or 4 minutes to give it.

And so, I think it's always safe to do what I do.

No, sir.

First of all, I want to say that we at the Department of Human Support, the way Christ leads, and we want your economic policy program to succeed.

The broad base of political support that is required for success depends upon the fairness of the adjustments that will follow the degrees.

Your decision to invite us here today is very commendable.

And like John Scott, I express to you my appreciation for the opportunity.

The goal of this planning must be toward a truly effective program to reduce inflation, unemployment, and inequity.

We must question any adjustment or any statement of the economy that is made before a significant adjustment upward is made for farm prices.

In my humble opinion, I will share this.

The 1970 Farm Act effectively set a ceiling for our farm income for a two-year period.

Farm parity at the moment is at 70%.

In the last 60 years, there have only been three years in which the parity ratio was at a lower figure.

Prices for many agricultural commodities in the marketplace are, of course, lower than 70% parity figures.

Your 1970 economic report listed farmers' return on investment capital at only 1.1%.

I feel that this is a fair criteria, because this is the criteria that industry, everyone uses in this country, in terms of what kind of return can you make on investment capital.

Rural America is lagging not only in income, but as everyone knows, in health, education, housing, government services, facilities, and even in most kinds of area-wide planning and development.

In my opinion, the recession in AgriConcert is a drag on the rest of the economy.

I was shocked yesterday in terms of the kinds of figures to find that if the current trend of costs would continue like that in the last two years, that in 1975 it would cost farmers 25% more to farm than it does today.

You have indicated that productivity should be a guideline for upward adjustments of income.

Mr. President, we very strongly support that concept.

You noted in your speech to the dairy farmers in Chicago that agriculture has increased its productivity over the last 20 years by some 300%, twice as fast as the rest of the economy, and as Mr. Carter indicated that...

I heard you say that over there.

part of the agriculture, I leaned over to the fellow next to me and said, I wish we had been.

We see unemployment as a problem, I suppose as bad in some respects as inflation, because we've got a lot of unemployment in rural areas also.

We're concerned about unemployment on a national level,

Because ultimately, our well-being is related to purchasing power of people.

And so, I think what, of course, has to be very important for farmers are concerned.

We certainly support the removal of the dollar from the gold standard.

I would say that we question the continuation of the 10%...

I believe that in the long run, the surcharge, which would fall heaviest on agriculture, I noticed in the paper this day, or so ago, that a working group

on the general green trade tariffs.

It is reported to be saying that GATT members are entitled under the organization's rules to take counteractions against the U.S.

They're saying, of course you can do it if you want to.

Although exports to a lot of people in the United States are relatively unimportant, they sell only 6% of our current dollar economy, but they are extremely vital to agriculture.

One of every four acres goes abroad.

And no other segment of the American economy is as dependent on our foreign sales as its agriculture.

And I'd like to say very critically that increasing exports just for the sake of increasing farm commodity exports is no answer unless it produces meaningful income for the farm.

We run into quite a bit of static on this front, Mr. President, because the idea of producing more and more have no additional impact on this.

The most serious drain on our balance and maintenance, except for the war and the related defense programs such as our involvement in the army,

I think it's been the investment of American dollars that's gone, and I'm hoping, Mr. President, that some additional, that you take a good hard look at that, perhaps some additional limitations, there are limitations now, probably some additional limitations should be placed on overseas investments, particularly inclusion of agriculture.

Agriculture has a way of moving elsewhere.

The most serious omission, I think, in the economic policy so far has been the absence of sitting on interest rates.

I'm well aware of the challenge of the ceiling.

I think this is a very carefully set, very complicated way to explain what is being done, and I'm heartened to know that we are moving forward.

Interest rates and agriculture, that does a tremendous percentage of its business on borrowed money.

Interest rates, high interest rates, are of course a great factor on the agriculture front.

It said the economic report showed that food chains earned a 23.6% return on invested capital as contrasted to the 1.1% brag that I referred to earlier.

This raises a difference.

Excessive profits makes them relatively less dependent on borrowed money.

I hope that the administration will take a good hard look at what should be done on the excess profits front.

Let me just close then, Mr. President, by saying that you have a great deal of support out in the foreign sector

...on the move to take those farmers by a large field.

That it is time to move on the way that they have passed.

That position that was taken when I brought it to the free-flowing of a metal of US currency was a tremendous position.

I think this demonstrates several things.

First, it demonstrates faith and confidence in the integrity of the U.S. dollar.

And it didn't just say that to we people in America, it said it to the world.

And this is important.

We do have faith.

We do have that the U.S. dollar is still the best country in the world, and the integrity of this dollar is important.

The way we regulate the...

Investments in U.S. currency is injecting integrity into our business markets.

And I'm real concerned about this.

We must be the best place in the world to invest in currency.

And we've had some subject on this.

And it is important that we recognize this.

The fact that we've had these imbalances, and you've recognized it by saying that there are imbalances in our economy.

I've said to the world that there is time for us to take a look.

I've been real pleased with several moves here that have been made.

I think that one of the problems that we have is having labor in its rightful position.

as related to the total economy.

And you can't just look at labor by itself.

You can't just look at agriculture by itself.

You can't just look at a business by itself.

We are an economy.

We are here today.

We have a freeze in Force 9.

And the guarantee of this freeze is that we do not create a situation that would allow the elimination of some of the things that have caused the imbalances.

that projected this freeze, then where are we?

And I'm really pleased that we had an opportunity here to meet with you, that you are listening to many people and trying to find the right answer, and the right answer isn't going to be easy, it's going to be simple.

It is really important that we understand the importance of the real security of the American economy.

And the real security of American economy is tied to the confidence that we had in U.S. business, along with the proper kind of relationship as related to labor.

It is important that we have these things.

You can't just look at labor, you can't just look at industry, you can't just look at agriculture, it's a matter of getting the balance.

And it's these imbalances that have created the problem.

So we have real problems, and I wish I had a real simple easy answer to the things that we corrected, and I don't.

I'll say that from the beginning.

It's a very complex thing.

It's a very difficult thing, but we're going to have to move from where we are.

Now, this has been commented on about the uniqueness that we are in today, with inflation on one hand and unemployment on the other.

And this, likewise, is not the answer.

I personally feel that there are some circumstances of confidence.

Of course, the winding down of a war is always a difficult time as far as...

The economy is concerned.

It's difficult to maintain employment.

But along with the inflation thing that we have, there are some things that oppose this, this idea.

And again here, and I don't want to be misunderstood as to my attitude towards labor.

I am not opposed to the right kind of negotiation for people that have the commodity of labor to sell to negotiate for.

But I'm suggesting that we need to have a more equitable position for that negotiation.

And if we have that, then we can have enterprise operating at its max by having the right kind of a plan.

And this is not unrelated to foreign trade.

This is not unrelated.

I've been impressed that two or three years ago, the labor groups themselves were strongly in favor of expanding foreign trade.

Today, too many of them have turned around.

And why?

Because they have been, labor has been a part of the factor that has forced us out of the competitive position.

And you know for the first time in history, for a long time at least, the last four or five months we are in a poor position relative to our imports and exports.

And this points out that we are not in competitive positions in the world.

And we must, in the American economy, we're going to be the leader in the world, and we're going to maintain the kind of economy we have.

We're going to have to be competitors in the business climate if we're going to stay in business.

In my opinion, this is the direction that we have to face.

We can have political direction that will alter temporarily the changes, but unless those directions are about in the right place,

We're going to have adjustment and change, and that political position is not going to be maintained.

So it is important that we recognize the marketplace, and the marketplace has been tried to be disfavored.

As far as I'm concerned, the market is giving direction to the tradition.

And when you try to evade that, and there's no place in the world that I know of where they've been able to evade that for long.

Even in dictator countries where they dictate price, or they dictate supply and productions and all, unless they have the price at about the right price, they're in trouble.

And we'll take this as an example.

This foreign trade thing is really important to the future of not only agriculture, but to the future of the American economy as I hear.

We are too much dependent upon the trades of the world.

There's going to be lots of trade going on in the world, and we need to be a part of it.

The temporary freeze, and I hope that it is a temporary freeze, because I have great confidence in

in the enterprise system working if we set the guidelines that will allow the right kind of negotiation between groups.

And this is the responsibility of government as far as I'm concerned.

This is the responsibility.

I'm hopeful that the 10% import tax will be temporary.

As has been promised, I feel like Tony has just mentioned that it can have repercussions

Upon our trade ballots, upon our foreign trade people that we do business with, I think that the fact that it's been proclaimed is not of lasting significance.

I think that it really attracted their attention.

It really attracted their attention.

And I think that it pointed out to the world that we're not just passing, we're not just standing by and letting anything happen.

We're going to be negotiating, demanding, tough negotiations.

Be there in that whole world trade picture.

I think this is very important.

I think generally those are the points that I am particularly concerned with.

I hope they are held in seat, because I think the total picture is the one I have to be concerned with, and I know this is the one that you have to be concerned with.

Mr. President, on behalf of our people, we certainly appreciate and are honored that we're here today to represent our segment.

And I appreciate Mr. Secretary for calling us to participate.

We do very strongly support your stand that you've taken, Mr. President, in this, and we feel that you're giving the leadership that has been needed.

I have a short statement.

Farmer strongly support President Nixon's leadership in initiating the forceful and dramatic steps to curb domestic inflation because the cost price, which has been a strenuous career sponsor, I think everybody has mentioned this,

that we've had a 7.8% rise in farm prices in the last 20 years, while our costs have increased by 52%.

Farmers as individuals have lost much of their bargaining power, compared to that of major corporations and major labor unions.

Farmers are especially gratified for the exemption for raw farm products in their current freeze, because it shows, Mr. President,

that you recognize that such prices have not contributed to inflation.

You brought this out earlier.

Last November 13th, farmers strongly heard some effective curves on prices and wage rates, so they are tied to productivity.

We think this is very important because productivity has played such an important role in the production of farm stuff that we...

are the best-fed nation in the world, and the housewife today is paying about 16.2% of her spendable income with food, compared to 26% some 20 years ago.

Quite a decrease, and the lowest in the world, I might say.

This is the best standard of performance and the best way to obtain equity and political acceptability for the overall program.

Some sectors of the economy have been getting wage and price increases far exceeding productivity.

I think this is a thing that has really caused these imbalances in the United Nations.

On the other hand, farm prices and income have fallen far behind the demand gains in farmers' productivity.

Farmers note the special attention you gave, Mr. President, to productivity and agriculture in your talk in Chicago on September 3rd.

They are proud of their performance and are gratified by your recognition of this.

We in cooperatives are also gratified by the part and are proud of the part that we have played in this increased productivity over the years in agriculture.

The prices of farm products sold for fresh consumption, such as fruits and vegetables, should continue to be exempt all the way to the consumers, and processed food prices should be exempt up to standards determined by productivity of workers and farmers involved.

The processing, the retail and transportation cost component, which comprises over 60% of processed food prices, should meet the overall standards for productivity of all industrial firms.

Farmers can only approve the amendment.

What you would do there would be to separate out the component of the farm, the raw material, and any of the other administered products.

On the one side you would have the, you would have the, obviously what the mark triggers, you would have the other control, and then that way you would have a, rather than just putting a ceiling on the top, which even depresses the mark.

Yes.

The control of the mark.

Right.

which has to control the distributing and processing margins.

Yeah, the margin.

Tie it in again to show that it gives you the intestinal firms.

Yeah, that's right.

Farmers strongly approve the steps taken to coordinate foreign and domestic economic policy.

They recognize the importance of the 10% import tax surcharge as a temporary measure to get the attention of our trading partners.

However, this surcharge must be temporary or it will hurt farm income because it will lead to retaliation of farm exports and damaging the world trade conflict.

10% surcharge removal can be tied to multilateral negotiation on such matters as exchange rates, tariff and non-tariff barriers, and sharing of worldwide responsibilities for peace.

This surcharge can be justified in the short run if it leads to trade expansion in the long run.

Therefore, farmers' orders prompt initiation of multilateral negotiations, which will lead to removal of the 10% import tax surcharge.

Through self-help programs and cooperatives, farmers have and are improving our economic system by working together to inject competition and to improve efficiency in marketing farm products and in procuring farm production supplies.

Group action by farmers can increase competition as a positive anti-inflationary restraint on farm costs and a positive force to bring prices of farm products in line with productivity.

They earnestly solicit the president's continued support for this kind of group action.

And closing again, I think that this is, with agriculture being the backbone of the nation, I think it's very encouraging to us that we have been invited here as a group to present our views, and also I think that there's a lot of work that we can do among ourselves to work more closely together to improve our life.

Thank you.

Mr. President, we appreciate the opportunity and the secretary and members of the staff here.

The few remarks that I have to make, if I may put it in perspective also, as Bill Coots said, that I think we have to look at the total problem and try to weave this into what problems are causing balances.

I think if you...

really rose to the statesmanship level and increased.

That accomplished not only giving you a position of the offensive and the international trade problems, the deficit of payment, but I think you've made the move that many of the countries that we built back for the Marshall Plan made it possible for them to come forward that we're destroying our dollar, and that this had to be stopped.

I think that it also brought the attention to the people of this country that you were focusing not only attention, but action on this front.

That is a vital concern that everyone should have.

I think that...

I'm going to try shortly to relay some of the viewpoints that we have on the total economy.

I think that the problems that you face now as president are certainly not problems that have been created just now.

They've been growing problems that have not been met for the last 10 or 12 years.

I think that you come to the point that one thing that I'm always concerned about is that I remember the days of FDR when everything seemed to be coming along, but I remember 1937 when we, I believe, we were beginning to drop back as it had been for the war build-up.

No one really knows what would have happened.

But the problem is, we've never had a global climate of equity in these kinds of economies, and it's all hopeful that we're getting there.

I think that the unusual factors that we have are the inflation that is still being viewed.

On the other side, we have the situation where we have an enlarged segment of our population.

Now, how do we tackle this, and how does the farm picture fit into it?

I think that Senator Jekyll's state convention Saturday evening, in which he pointed out that if you were the first president that he had ever discussed three times since you've been president,

That is something about bringing the farm and cattle level up for the rest of the economy.

Of course, where all those skeptical agriculture has been forgotten.

And now we're going to try to briefly say specifically how that we feel in general outlines of what the alternatives are.

I think that you have to meet both the problem, the other problem of economic recession, although it serves a great purpose, it throws imbalances, and it's probably an unenforceable situation over a very long period of time, which would

The situation as we see it, on the one hand, the fuel that

is still being put into the inflationary segment of our economy, is twofold.

One is that I think you have a situation that our economy is very different than it's ever been before.

That you have a large conglomerate corporate structures that have the ability to administer prices

Therefore, when you have a drop in the volume up, they raise the price of the refrigerator $15 to continue the profits.

A few things that I understand, that when the GNP goes down, the inflation increases on some of these very essential items to the American people.

So I think that we try to get out of raising the interest rates and trying to correct the problem by cutting back the supply of money.

This is the taxation on the higher income groups and on the larger profits.

Very carefully not to destroy the incentive and the free enterprise capitalistic structure that we have.

This could pay also, as we go, some of the situations that we need to subestimate.

On the other hand, you have situations where labor is concerned.

I do think, though, that leadership has a particular role that they should play and must play.

They have the role of fighting for the welfare of people that they represent, but I think they have to exercise leadership when those get beyond what they should be.

And there are some imbalances in some of the adsorbent wage contracts that have been negotiated by the various unions.

It's not across the board, but in some instances.

And this is going to be a very difficult decision for you to make in fairness.

The other situation that I want to talk about particularly, what the agriculture sector...

As far as the economic recession part of the problem is, I think that your attention here, recognizing agriculture as the first example that we've had in the last recent years, where the president has focused attention on agriculture as an equal part of the economy.

And I think this is of vital importance, and I'd like to point out an example of why I feel so strongly about this, not only because they overlook.

When you fly across the country at night, you find that there's a large city 300 miles farther, another big metropolitan area.

But as you look down and you see an accumulation of lights in a 2, 3, or 5, 10,000 city or town,

And you see those little poles right here and one there, a mile or half a mile apart.

It means that those small towns are the service centers for those individual lives.

That's a farmer.

And we're not talking about just a small segment of the population.

We're talking about 30% of the people in this nation that are directly tied to the level of income that the farmer receives.

Because when you force those lights out, out there, those individual lights, you're forcing out the lights of the people in the small towns, and it means that those lights have all disappeared and went to the cities.

And therefore, we have a situation where that, unless we...

I do something about, with half the poverty in the rural areas, the best rural area development program is increasing farm income.

Because when you increase farm income, it's less of the inflationary problems because of the smaller percent of the consumer dollar that does go to the farmers, or it's the same as product and concern.

In order to tackle this, I think

I have to suggest five specific things.

One is that the loaning of interest rates.

I think the route that we have gone in this is very difficult.

It prohibits the small business man to get the credit that the larger corporate structures of course have access to the credit.

I think that it creates the unemployment situation.

I think the next thing that you, a big problem that you have to face, that...

The days of Teddy Roosevelt, he moved some corporate structures, and I believe one of your statements that we're going down the lone road to ruin, or someone has made that, and not applying to this particular situation, but when the Roman Empire collapsed, one of the factors was that some few hundred people owned all the wealth in the country.

Now, I'm not socialistic in nature, but I do think that there comes a time when they can get out of control.

You have the interlocking directors in so many of the companies that makes it possible for them to administer prices.

And this means that with the large conglomerate structures, that this has to be tackled with the antitrust, the enforcement,

in order to be able, and aggressively, because you don't have to stop them, it's a rollback, as far as I'm concerned, of this particular thing.

I think as far as the wages, I'm strongly requiring an equitable margin, but I think that there has to be decisions made on some of the inequities that have been built into this.

I think the next thing is that

In the countries that we have helped develop, now they have the dollar in their currency to pay for some American products.

I'm not saying some are.

I think this is entirely your decision of how you have to do it, and use the strategy to get the things that you have to have, not only for farmers, but for the total economy.

Without that there, without your ability to do that, it's...

As you negotiate throughout the world on the monetary situation, that has to be your awesome decision, that you have to make the decision, because only you and your people in the cabinet know what the situations are.

We'll rest back with your judgment on that, but I'm not as fearful of retaliation as many are, because you're on the offensive.

And I think this is important.

You certainly notice that you are on the offensive and you are willing to take the stand necessary.

And that you are to protect the dollar and you are to protect the economy.

I think the thing that's getting down, and I'd like to stay in passing with this opportunity, the agricultural plan is at great jeopardy, Mr. President.

The average age of farmers is 50 years.

We've gone the route to where you had to decrease the number of farmers to move them into the more efficient parts of the segments of the economy.

But there comes a time when that trend has to be stopped, because I think we'd be deeply concerned if the average age of their electronic engineers were 58.

I think we have to be just as concerned with the average age of markets at that, because they're the people

that have to have experienced management know-how, they're going to have to have the credit capabilities to enter business, but they have to have a profit also.

And I would say here that this, of course, has to be able to be in an organized economy to use their economic strength.

But I think that on the worldwide situation, in those commodities,

were that the countries that have the dollar have to have the products.

And we are the major source of supply.

And Japan is very interested in their future food supply.

They're very concerned about the Japanese government.

And they're concerned about where the supply is going to come in 15 years from now as the world population continues to increase.

I think that where they have the ability, and where we have most of the profit, that we ought to be in a position of not worrying about a jumping situation that has killed the price in the past.

But we ought to go for international agreements,

that establish floors under farm products, on every farm product that we can, with the exporting countries.

And I think this is possible, and visiting with the Common Market Company, a country representative, to do it on several of the agricultural commodities.

And if we can establish the international floor agreements,

This I would like to recommend that you explore every possible avenue.

This then alleviates the problem that Secretary Martin has of giving up farm income in our country.

And then of course of raising price supports to give the minimum floor prices to all that we possibly can.

Because by doing this, you put the economy in rural America in a position of profit.

And when you put the economy of farmers in a profit position, it means that you put the rural communities in a profit position.

And by building this type of economics, in the final statement, if you, in rural development, if you take a small town,

And they give them a series disposal system with half of it in grants, let's say a million dollars system.

And half of it in grants, you leave them with a half a million in debt and interest to pay on that.

But they're doing it in the hope of being able to attract industry basically, which may or may not develop.

You can spend 50 billion dollars in the next three to four years in world development.

But I believe many of the economists will agree that at some there's a difference in agreement as to what level.

But when you go back to the raw material productivity,

And a dollar increase in income there multiplies itself through the economy.

Some will say three and a half times, and some four, and some five.

I will not go along with some of the old time economists to say seven, but somewhere this happens.

What I'm saying is with an extra ten or twelve billion dollar increase in farm income in that period of time, you have invested

in productivity that will multiply itself through the economy.

But not only multiply itself through the economy, but will use the one vital area of rural America where you can invest the money and get a better return than anywhere else, I believe.

And the total effect that agriculture still being the largest user of oil.

I think we forgot one very important point.

That is, although there are less farmers, the economic impact is still almost as great as it's ever been.

Because of the big investment, the big cost of operating the agricultural plant.

And that although the numbers are less, the economic impact, and I don't believe that any economic policy can succeed.

Unless we look at this 30% of the people that are tied to the farm income level.

And this, I think, is where you have to tackle a very important part of the economic recession through this country compared to the inflationary.

Second.

What should be the policy?

How much is there to be?

And what should be the mechanism in your judgment?

Recognizing that there are strong political forces at work here, what should be the mechanism for dealing with it?

That's a big question.

Let me try, rather than putting it quite as broadly as that, let me say, is there a kind of agreement in the group that there shouldn't be a follow-up program?

In other words, I understand you've got a wage price freeze.

A wage price freeze.

will only work for a limited time without a huge bureaucracy, and of course also without an enormous public support utility, generally by war.

To have a wage price freeze working in peacetime is extremely unusual.

The fact that the American people have responded so effectively as they have, and particularly that American labor has to wage freeze, because it's an indication that people are concerned about it, and they're willing to make temporary sacrifices.

On the other hand, you cannot expect that wage price freeze beyond, say, 90 days, maybe it goes on 120, maybe it goes on, I don't know,

another 30 days, whatever the case might be.

But beyond that, there is a point that all the experts agree that the inequities, other risk-deferring teachers' salaries, risk-deferring others, and risk-deferring some,

price adjustments, and there are literally thousands of price decisions, as you know, made around the country, there comes a time when those inequities blow the system out, and then you have to degrade the rules of government, frankly, enforcers of other countries, which we don't want to do.

On the other hand, there seems to be general agreement between the labor group and the business group, while they would do it in different ways, general agreement, that there should be what they call a follow-up program,

programmet which we should attempt to, after taking this very drastic action that we attempt to,

keep the lid on so that it doesn't just blow out and get worse than it was before, which it might, and all these kind of forces might just go right out like that.

Now, you've all indicated that you, and I've noticed that several of you have indicated here, that any decision that is made with regard to agricultural commodities, that we should look at the freeze as it affects

A processed food sold in a grocery store, that when you increase that price, it inevitably has considerable direct increase in the farm price, too.

I understand that.

But now we come to the point, it goes to what we want from here, which is a general agreement, we could buy something or nothing, or that tree we could have.

You don't need to use precise, because we haven't made up our minds either.

Well, let me say it.

We've made up our minds there.

I believe there has to be a follow-on program.

I believe also the follow-on program should be one that has to be effective.

I think that on the other hand...

We have to recognize that in the long run, the answer to our problems is not a continuing government ticket about wages and prices.

The answer to our problems are policies, increased productivity, proper monetary and fiscal policies, which is the policy that controls them.

Unless we have what we call, each of us has a different definition of it,

Unless we have a free environment operating, we aren't going to end this.

I feel very strongly that we should look upon this as a very necessary temporary measure, the 90-day freeze, to be followed by a very necessary action over a period of time, but not across the board, no exceptions.

In fact, we

Thank you very much.

There are some pressures that are created by different groups that cause change.

But the basic factor is the dollar input of government debts.

We've gotten, we've evolved to where we are, and we're going to evolve from where we are to a better position.

And I think that we are in a good position now to take a look.

And I don't know the answer as to the kind of a formula.

I think there are certain guidelines that are the right ones.

And these guidelines that we talk about, as far as I'm concerned, can be real productive in getting the balance between different groups.

For instance, there might be some merit in taking a look at a labor policy that would allow the taking of either one or the other of the last two proposals.

I think this would breed some integrity under some of the labor negotiations.

I personally feel that there's a way to run it.

And I think this would tend to eliminate it.

We're out of line, and there's just a set of how you manipulate and operate this is something else.

But these kind of guidelines, I think, can evolve us from where we are to an operating economy that I'm sure we all want to achieve.

Mr. President, I'd say you put it in good perspective in terms of the situation we face after the 90 days.

I would, for one, strongly urge that there be a follow-up program.

I think we're in a spot in the country that everybody's waiting now.

They're poised, you know, to...

I think not to take some strong positions.

I had more of the bureaucracy thing you were talking about.

And yet, I feel that I don't know how you're going to do it.

I don't know just exactly what kind of a format you'll use.

I don't want to draw on anything that's been done in the past, because I don't think that was very successful.

But I feel very strongly that it has to be a firm program, and for whatever additional spirit is required to manage this achievement,

Oh, it's got to have some teeth.

It's got to have some teeth.

It will.

Otherwise it'll run away again.

You try not to have... You say it'll take your factor to make it work.

Is a...

is a majority of public support.

You've got to have that.

But on the other hand, if you have too many calciums who go off and say, well, we're going to get off and get ours, then eventually that breaks the emphasis of justice.

You'll have the decent people, the people that want to do what the people want in the country.

But if they say, well, gee, this guy's doing it, and this guy's doing it, and this guy's doing it, and people are all doing it, they're going to do it themselves.

That's why you gotta have something to eat in it.

I think that the problem

of establishing a board, which I agree has to be.

A board?

Or something.

And I hope agriculture is well represented on that.

But the point is that a board, that if you give the enforcement authority, if you run into the bureaucracy along a farther on down line, that they have to meet the problems, unless you do it on a broad scope.

I think that my quick question

The only way that you can meet the problems is to get those two facets together.

in the best statesmanlike manner that you can.

And I think this is good politics in the end.

I think that the majority of the people in this country now are looking for firm leadership that might not be popular right at that particular moment, but if it gets results, it will be the most popular and it will lead to the best politics in the months ahead.

I think that you have to get it from the two standpoints.

I think on the one that I would say that a new tax program that maybe you could even control down to the inflationary wages as far as wages.

Some of them are getting up high enough that maybe you could touch it this way.

But as far as your profits are concerned...

This I would hit too.

Always keeping in mind that you may tighten it a little too tight in the initial phase, but you can relax it a little, not to destroy it.

I would of course lower the interest rates to as much as possible, and with all your factors, you always have to be a much better judge than I am, unless you know the factors and I don't.

then I think I would take a move realizing that the real problem with the economic depress is that you've got a highly organized group of people here that, with their interlocking directors, have the ability to administer prices.

You have the organized labor forces that are strong, that have the ability to raise the wages, but then, every time they raise their prices, or they raise their wages, the unorganized people

then get weaker and weaker.

And that's where I think that you have to take direct action in doing everything that's feasible in raising the farm prices and doing every other step to take and keep it divided into the two facets.

On the one hand, to take the steps necessary to cool down the inflationary fuel that's going into those segments of the economy.

If it means the same wages at a certain level, at a certain allowance,

The contracts, this, you get something that you can't administer.

And if you get too involved in trying to cover the entire waterfront, I'm afraid that you will have created a board which a few months from now will have been ineffective because although they had teeth, it's going to take a bureaucracy to carry those teeth out.

And the only way, I think, my suggestion, the humble suggestion would be to

to attack the end that's more inspiring, the inflation, and take the steps to stop that, and then take the other facets to try to do something in the unorganized people to create an economic growth which will create employment, which will put many people back to work by getting it on that end.

Well, Mr. President, I would just say that the Greens go hard and support a good program.

Can you be on the streets?

I think that you do have this at your advantage.

There are many people that are saying, well, you put off doing this too long.

But, be that as it may, the situation has gotten so bad that you do now have broad assistance and support for some kind of a program.

We don't think that the voluntary program where you get somebody from labor, industry, agriculture and consumers down to get them to work at all has to be a governmental group with authority.

And the other comments that are made here in terms of dealing with the prices and wages that we agree with, I'm not too sure that

that the financial file labor itself is not willing to admit that the revenues of runaway contracts and goods changes.

They do have assurance that some of their national leaders, the difficulty is that some of their national leaders can't control some of the wild air.

I think that when a rank and file man in labor is assured that there is some attention being given to his cost of living, that he's going to be willing to accept to be trained on his wages along with that.

As far as this goes, the Greens will include the Federal Reserve and the government to work at that in the usual way.

The idea, of course, that especially those in agriculture are much concerned about high interest rates when we don't have a compensating high sales price for our products.

Excess profits, of course, that's, I think, down the road someplace.

I don't think that's something that the president doesn't really need to be concerned about at this moment.

Because, actually, if we could don't show that there are too much of this on our side.

I think Mr. Craig, we all believe very strongly in the free enterprise system, and I personally feel that in order to protect the free enterprise system, it's not even mandatory for you to continue with some type of control without setting up another bureaucracy, as you point out.

But I do believe that the step that you take, you need.

The dynamic leadership that you've shown in this has unified this country more than they've been unified in a long time.

I think this is one of the keys to success, and to continue on this line is the unification of these important things that we have facing us today in this great land of ours.

You may have said very much about food prices.

Do you want to get anything else in the mix?

We covered the point pretty well, which I think is a critical problem.

And also, it gets back, George, to the thing that I know Paul meant, the thing that you know we've been working on, the thing I've been constantly talking about, those dams that were under crisis, the spread.

Now, what was the figure you used?

23.6.

23.6?

That's compared to 1.1.

So why would anybody want to be a farmer?

Mr. President, you have that same circumstance in a lot of businesses.

There isn't much in business.

More personal risk is capital and is management.

It was moving into a new business century.

And this likewise wanted to...

I think it's really important the direction we're going.

Yeah, products and business, for example, Germany's manufacturing, steel, etc., are very low.

And now people say, well, that's good.

I mean, the steel guys are going to get richer.

The main difficulty with that, just taking steel as an example, is that their profits become too low, they have less to invest in new plants, and as a result, they are less able to compete in the world market, which, when we talk about the world market, we want to remember it is also the market of the United States.

This is the biggest market in the world, and all the world wants to sell to us.

Let me cover a couple of points that you have braved,

In terms of this, but first with regard to the follow-on program, any ideas that you have, any career ideas, and you will have a chance to talk to some of your associates and have something.

If you would pass along a clip between now and the 30th of September, from the 30th of September, we've got to have all the input that we want, that we can have, because we will have a decision.

I mean, not a decision, but we have to, it will be a decision, but we will announce it.

The second point that I would like to make is with regard to this problem of imports and the import surcharges of manufactured commodities.

True, you talk about, well, import surcharge, we're concerned about that.

And, of course, even having a dollar note, which, of course, is an effect of import surcharge, too.

Because of the unfavorable...

The balance that we have with some countries, particularly the Japanese and some European countries, is a result of the R&D back then.

Their currency's relationship to ours was that we just meant that they could sell even better than we did.

The effect of that could bring some retaliation that's been threatened.

However, let us understand what the long-term reason for both actions was.

We allow the dollar flow, and we have the import surcharge for the purpose of setting exchange rates right, in other words, so that we were not at a competitive disadvantage in the world.

And as far as the surcharge is concerned, not as a permanent wall behind which we would continue to be inefficient in those areas where we could not compete,

but for the purpose again of stimulating, jiggering some of our foreign friends into being more reasonable in recognizing their responsibility to adjust their exchange rates, for example, to reduce some of their non-tariff barriers, and in another field, for example, to be more receptive when it comes to

taking products that we are competitive in, like agriculture, and they currently are.

What I'm getting at is this.

In the long term, I don't know of any part of American industry, and I use agriculture in that broad sense, that I think could get a greater dividend out of our foreign action than agriculture, for this fundamental reason.

When you might even come down to it, you want to remember that the only thing we can really sell abroad is something that really is competitive.

In other words, you raise the surcharge, you let the dollar float and all that, and we can't make great deals with these Japanese that are going to sell abroad.

All we're doing is keeping them out of this market.

As far as agricultural products are concerned, they are competitive against states.

In other words,

The purpose of this action is not simply to keep other products out of our markets, but to open up other markets to our products that are competitive.

Now, agriculture being, because of its high productivity, is highly, is in a highly competitive position in the world.

You can sell in almost anything, any place in the world, you know, items like soybeans and so forth and so on.

So, as these adjustments are worked out, and as we move to what we hope is more tricky, because it has been more tricky, we can only...

So as much as we're willing to get more and more trade, a major beneficiary will be agriculture.

Let me say, too, that Secretary Conlon, as he goes abroad, all of our people who have anything to do with trade,

are keenly aware of the responsibility they have to do everything we can to play this strong, to say that our European friends and others and so forth want to help us.

We've got some agricultural products, we can sell some of those.

Because while it is true that agriculture does provide, and it is the major, now that we've moved virtually out of the airplane business, as far as nutrition is concerned, it is the major producer of foreign exchange.

as far as trade is concerned, two billion dollars for a balance, a favorable balance, two billion dollars a year.

Why is it that here we believe that there are even greater opportunities in the future?

Now you've heard that often, you know, everybody, I don't know, every campaign says we've got to have more and chances to sell agriculture come out of the ground.

True.

I'm telling you that we have no illusions with regard to what our long-range purpose is.

Short-range, yes, there will be attempts to retaliate.

But long-range, we are building a new system.

A new system that will be more fair to the United States in terms of what we can sell and what they can buy, what we can buy and what they can sell.

As we build that more fair system,

A commodity which is highly competitive and has a high element of productivity to it.

Efficiency.

American agriculture is not about that.

Not commodities.

You can't sell anything abroad that is not competitive.

So we have this very much in mind.

This is a big thing.

In terms of our general program, let me say that it is all part of an overall package.

For example, we have as you know some tax

The reductions in the recommended amount of the excise tax and the job investment credit, which is about 700,000 farmers took advantage of in 1962-65, so it was not too bad for agriculture in that field.

It's very important to realize that I believe, as I said in my message to Congress the other day, we cannot cut taxes without having a corresponding cut in spending, because then all you do is to build a fire of inflation that this witch Bryce Brees can only put the lid on for a while.

He had that fire blow up, so he said he would blow the top of the tea kettle.

It's like that.

So, we're keenly aware of the point you made there, of the necessity of coming and spending.

Now George Shultz will tell you he is hard.

I got to talk about coming.

Everybody says, that's great, except for us.

Everybody wants to cut somebody else's expenditure.

And I understand that.

We all understand that.

But we're taking very hard looks at this.

For example, the deferral of a wage increase for government employees.

The Congress will be taking that up this week.

It is vitally important that that be deferred.

I say that not because I don't like to see the government close, but that's only for six months.

The point is that, as we have a follow-on program, following the freeze, a program which we're going to ask, say, a private sector to...

I want to keep the lid on these wage increases and so forth for government to go along and say, well, we're just going ahead.

Will they tell you without regard to this?

It's not worth it.

And also, it costs a lot of money.

In other words, this provides, the deferral of wage increase provides some of the money that we need.

To cut the channel on the number of government employees, it's only 5%.

I've been around government for a long time, and there's inefficiency everywhere.

There's even inefficiency on a farmhouse, although not as much as in some other areas.

But if you look around government, they predict a 5% cut in any agency, any agency, with no strength.

I'd like to just make a brief comment here about the attitude that I get expressed from many, many fathers.

They are in support of your policy.

They have great confidence in the way you move.

But we have to understand that, and they keep relating to us, that the problem is that here, and I suppose every segment of industry would find this kind of an argument, that I think we have a pretty well-based agriculture, that agriculture is frozen at the bottom of the loop.

We're now at 70% of parity, and at the depths of depression, we're only operating down to 77%, so we're about as bad off as we can be.

And we say, here, we don't want an extended program.

that freezes agriculture in this unfavorable position because this is the very things that Orm Lee comments about as related to the total economy.

And if we freeze this agricultural end of our total ball at the bottom of the pit, where in real difficulty, and a lot of farmers have made this comment to me, they said, well, we sure wouldn't on a temporary basis here see the freeze, see the...

free on prices, on wages, but let's don't get caught in the position.

There's some imbalances that have created this position you're in, and let's don't get thrown into that position.

And also, when they have a ball, they don't want to get stuck in the mud.

I understand.

I like this part of it.

The part of it was there increased costs.

And the pricing policy is 17 cents, 17 and a half.

And the value for one.

They're very unhappy about the prices they're receiving.

It's part of the dollar.

That's about what it is.

It's a big problem.

But I think that the secretary here can work out some solutions as well.

With our help and advice, along with some of these matters, we've got an income situation that is affecting every rural businessman because their accounts are seen to be very high.

And this is a very critical issue because if they face a loading time period and their account is receivable on fertilizer and cleaning and all this type, it's a very critical importance.

You know, in second one respect, so that you realize this, we talk about the number of people represented.

There are 85 million waiters.

However, I am keenly aware of the fact that on two counts, that we should have five groups, and one, as I've said often, that a great country has to have, or in my view, generally has to have a strong base in agriculture.

And we have always had it, and we should continue to have it.

In terms of our international situation, agriculture is our major advantage.

It's the thing where we're most productive, so we can study the world in agriculture, so we've got to continue to have it.

And third is the other point, speaking totally in presence.

Well, there are only a few farmers who they matter, and you go down and talk to congressmen and senators, how much do they matter.

The point that was made here earlier, that when you look down, you go across the country, you see those little lights kind of go down there, and you see a little cluster of guns and so forth.

Actually, 30% is probably a modest figure.

A lot of others are affected indirectly, but certainly 30% of the people in this country are quite aware of the fact that they have a stake in a strong agricultural economy.

I think the other point that I would close on is to reiterate what I said.

I said it on other occasions, but it really didn't get picked up much until I had a Chicago speech, reiterating the point

that with all the things about the cost of our food programs and all that sort of thing, why are we subsidizing agriculture, and what about the requirements for these Cadillacs, et cetera, et cetera, that the American housewife

person pays a smaller percentage of her income for foodstuffs than she did five years ago, ten years ago, and so forth.

It goes down and down and down.

And, even more important, that the American housewife sets a better table than any housewife in the world with a less percentage

of her banded budget going for that table than any country in the world.

Now that's an enormous achievement.

And I'm aware of that.

We're aware of that.

That's why we have you here.

We want to, we're going to try to, we believe in this something down this state that will help you much.

We've got a dollar car and 17 cent cars that leads our hearts in the right direction.

We'll work on it.

I think that our productivity and our competitive is being very critically threatened today.

Starting with the secondary boycott of farm products in the marketplace.

And having gone through a...

But you're catching it out there, what part?

Are you from the north?

No, I'm from Fresno.

Fresno, that's what I mean, in the central area.

So I don't know where you catch it there.

And we have been catching it, and I think this is very critical.

I'm talking about our balance of trade.

If this is allowed to continue, I think no longer will we be in an effective position in this country on our farm produce, just because this is a very serious thing.

I've talked to Secretary Merchant about this.

And have you been involved firsthand to see what is taking place?

Because first of all, the employee is introducing the right of self-determination.

The employer is using the right to hire who he would like, and also the housewife or the consumer, whatever that product is, is losing the right of free choice of product.

And to me, I think the far-reaching implications of this is one of the most serious things that has plagued agriculture or this country since agriculture is a bad culture.

Bob, your question.

There's been two contracts that have been signed within the last two weeks that have forbidden or prohibited any mechanical apparatus of any type that is not presently used for a three-year production.

What is that?

Who signed it?

Who did the man that signed it?

Well, first of all, the first one came up, ours, because a few blind products were being boycotted.

They were coerced and forced into signing a contract that also made it this far to this, who decided to quit Q4, United Farm Workers Organizing Campaign.

And we're cutting in with them and being the sole supplier which has a problem with our contract.

And recently, last Friday, another organization signed a similar contract.

So when we talk about the technological advances that we've made in agriculture, and the fact that we've actually been subsidizing the consumer, this trend is going to reverse itself very quickly if this is allowed to continue.

To continue that.

To me, having been on the front line there, it's very serious.

And it's something that we really have to reflect on.

It's going to be the downfall of this.

Well, let me tell you that.

Speak louder than words.

I want you to know that despite all the political media I've been mentioning since 1968, in a sense, I never have quit eating grapes.

Thank you very much.

I want to send a few little crinkets that you might want to take home with you at...

We appreciate this, and we'll try to work on these problems.

Let's just do that and get a break.

Goodbye.

Good, good.

All right, fine.

I love it.