Chamber v. Board

Organized Business, as represented by 3,000 members of the Chamber of Commerce of the U. S., crowded into the great assembly hall, overflowed into the flowery patio of the organization's Washington headquarters last week to battle Organized Agriculture, as represented by the Federal Farm Board. A growing grudge Business had been nurturing against the Board's wheat policy came to a head: Was it right, politically, economically, governmentally, for the Board to use U. S. money to finance farm cooperatives, to buy and sell wheat in the open market, to compete with private industry? (TIME, April 28).

Barnes's "Menace." Julius Howland Barnes, board chairman of the Chamber (TIME, May 5), led off the attack on the Farm Board by denouncing its market activities as "a menace," declared its damage to private concerns "irreparable." Almost instantly the Chamber's meeting, generally a languid routine affair, was vitalized into an uproar of indignation at the spectre of Government-in-Business. The usual courtesies of public address were put aside as speaker after speaker flayed the Board. For once plain speaking became the rule.

Legge's "Crisis." Then the Chamber, not unfair, invited Chairman Alexander Legge of the Farm Board to appear and defend his agency. He, too, minced no words when he reminded his audience that two years ago the national Chamber, by referendum, had approved the very policies of farm co-operation the Board was now pursuing, had failed to follow up its recommendations with action, had remained silent when Congress drafted the Farm Act. Declared Chairman Legge to his critics:

"Most of you will agree that you know more about the agricultural situation than I do. . . . If you really do know so much, the situation presents a very severe indictment of your organization which, having full information of the facts, has made so little effort to remedy the situation. . . . Your attitude has been one of indifference if not of antagonism. You regard the farm problem like the poor, as something 'we have with us always.' You discuss it along the same lines as the ladies refer to the household help problem--something that has to be endured if one is to avoid having to do the work oneself. . . .

"Entirely too many of your members were for the principle of farm co-operation only so long as it did not work. . , . When a means had been provided to help the farmer get organized cooperatively, the effort was branded as 'government price-fixing,' 'putting the government into business,' as socialistic or anarchistic. . . . I don't recall in years gone by of you men making any such complaints against government aid to manufacturing industry, to transportation and to finance. ..."

Chairman Legge painstakingly explained that his Board's object was to set up for each commodity a co-operative which, "as it gains financial strength and experience, can and will become entirely independent of the Government." He defended the Board's loan policy on wheat and its open-market operations "to check unnecessary depression of prices." He insisted the Board's pit dealings had "averted a crisis more serious than the crash of the speculative stock market."

"God (the Economic Law)." But Business was not soothed by Mr. Legge's speech. Up jumped Daniel A. Millett, investment broker and stockman of Denver, who worded the sentiments of his fellow members toward the Farm Board when he orated:

"The farm act is part and parcel of the fantastic worldwide dream of stabilization. . . .

"The time has come for the people of America to take down that priceless heritage, the King James version of the Book of Books and turning to the twelfth chapter of the Gospel according to St. Luke, commence to read at the 16th verse:

"And He spake a parable unto them, saying, The ground of a certain rich man (the United States) brought forth plentifully (that is the surplus).

"And He thought within himself, saying, What shall I do, because I have nowhere to bestow my fruits.

"And He said, This will I do: I will pull down my barns and build greater; and there will I bestow all my fruits and my goods. (That is the withholding program.)

"And I will say to my sold, Soul, thou hast much goods laid up for many years; take thine ease, eat, drink and be merry. (That is the high price that will be realized.)

"But God (the economic law) said unto him, Thou fool, this night thy soul shall be required of thee."

Wild Men, Pegging, Octopus. At this point in the meeting Secretary of Agriculture Arthur Mastick Hyde, a member of the Farm Board, rose excitedly to his feet. Trembling with agitation at the Chamber's attacks, he demanded the right to be heard, was hurriedly introduced as "a farmer who has become a Cabinet member." Thoroughly aroused, he spoke fast and freely:

"That parable is properly applicable to the sin of business covetousness and that kind of fatheaded satisfaction with things as they are. All I ask you to do is to take a look at the wild men over in the Senate and view the rising tide of discontent and then look at your market and see whether you want to store up your surplus!

"More misapprehension about the Farm Act has been produced here in this highly respectable and influential audience than I've read in all the farm journals of America. . . . The Farm Board does not expect to peg prices; the Farm Board has made no attempt to peg prices. Price-pegging is not in the act and price-pegging is not found in our program. . . . * We never expected to control prices. We do propose to try to influence production."

Secretary Hyde, panting, paused to catch his breath. Then, pellmell, he continued:

"You've heard from Mr. Legge why the Board went into the wheat situation through loans. . . . Maybe it was a mistake. If so, I glory in it! We have made others. We shall make more. . . . I thank God I am serving a chief [i. e. President Hoover] who sees through the mistakes to the ultimate welfare of 27,500,000 American citizens!

"In this loan upon wheat, the Farm Board made the same mistake that a banker makes when he loans too much. . . ./- Everybody believed last fall that wheat should go up anywhere to $1.60 --not on any fictitious price but on the law of supply and demand. . . . Then came the deflation on the stock market in New York. The price sagged under the weight of that octopus! The slide continued. . . . Was there anything unsound in that? Was there? . . ."

Resolution. Mr. Hyde got a splattering of applause but the Chambermen remained unconvinced by his heated words. Next day by an overwhelming viva voce vote the full Chamber adopted a resolution condemning the Farm Board's policies. Against the resolution was raised only one voice, that of John Brandt of Minnesota's Land-o-Lakes Dairy, a co-operative that had received a $2,000,000 loan from the Board. His warning:

"Adoption of this resolution will be construed by farmers as a declaration that this Chamber is against agriculture. Your resolution won't change the law but it will create the greatest rupture in a long time between Organized Business and Organized Agriculture. Agriculture didn't squeal when the earlier tariff laws were adopted. Business shouldn't squeal now."

Excerpts from the Chamber's resolution:

"The anticipated benefits to the farming interest as a whole have not been realized. . . . There has been imposed unbearable hardship upon business enterprises unable to maintain their position against discriminatory competition from the Government. . . . We express our continued opposition to the use of Government funds in providing capital for agricultural co-operatives and for the buying and selling of commodities. We condemn as a permanent policy of government the employment of public funds to participate in business in competition with established agencies."

The Chamber's resolution demanded that the Board be stripped of its $500,000,000 revolving fund and confine its activities to gathering information, studying overproduction, giving general advice--nothing more; in short, that the Board, an official body, be stripped of all functions not enjoyed by the unofficial Chamber.

Legge's Last Word. Informed of the Chamber's vote of condemnation upon his Board, Chairman Legge, busy with gaining control of May wheat in the Chicago pit, snapped: "Not interested!"

* Technically correct. The Farm Board pegged not market prices but the loan value of wheat to cooperatives. When it attempted to maintain that loan value by its purchases, it failed.

/-The Board loaned $1.18 per bu. on Chicago wheat now selling at $1.01.

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