Attacking the Surpluses

Secretary of Agriculture Ezra Taft Benson presented himself before the Senate Committee on Agriculture and Forestry one morning last week, radiating ease and self-assurance. Three days earlier, President Eisenhower had sent to the Congress an 8,000-word farm program designed to reduce the country's agricultural commodity surpluses and to end the down-drift in farm income. The President had held firmly to Benson's principle of flexible price supports, making no concessions to those--including Democratic Candidate Adlai Stevenson--who advocate rigid high price supports.

Benson told the Senate committee that the surpluses lay at the heart of the farm problem. "Our surpluses must be reduced as the essential precondition for the success of a sound farm program," he said. "Storage costs run about a million dollars a day." Worse, the surpluses, which were largely created by high price supports, depress the market; the high supports thus have the opposite effect to that intended. Benson told the Senators: "The huge surpluses reduced farm income in 1955 by the staggering sum of more than $2 billion. What the President proposed is a direct and effective attack on the surpluses themselves."

Soil-Bank Plan. The heart of the President's program, Benson testified, is the "soil-bank" plan, designed to cut plantings of wheat and cotton by perhaps 20%. The bank would consist of an "acreage reserve" and a "conservation reserve," which would cost the taxpayers $1 billion over the next three years. Farmers choosing to join the acreage reserve would take specific acres temporarily out of production, receiving compensation based on a percentage of the normal yield. Compensation would be paid, Benson testified, in a novel way: the farmers would get certificates redeemable by the Commodity Credit Corp. in cash or in surplus commodities. Benson explained: "We would use the surplus to use up the surplus." Farmers who joined the conservation reserve would get compensation for taking acres out of production for five to ten years and for planting grass or trees; these farmers would have to guarantee not to graze livestock on their conservation reserve for a specified period, so as not to add to the surplus of livestock and food.

Benson also recommended a vigorous effort to dispose of the surpluses already held by the U.S., even by selling or bartering in the grain-short Communist colonies of Eastern Europe. His program also included a proposal to help some 1.5 million low-income farmers to improve their farming efficiency or, failing that, to aid them in their transition to non-farm employment.

Package Deal. When he had finished reading his 19-page statement, Benson leaned back, clasped his hands and invited questions from the Senators. Senate Agriculture Committee Chairman Allen Ellender, a Louisiana Democrat, asked whether any of the new benefits would get through to the farmers "immediately," i.e., before the presidential election. Benson claimed that the program, if enacted, would provide "immediate buoyancy." Ellender moved on to fundamentals: "Would you have any objection to our writing into the law a provision for rigid price supports for quality crops?" Benson flushed. "I look with favor on production of quality crops," he replied, "[but] we could be right back in a situation where we were getting so much quality production that we'd be piling it up in warehouses again." Despite Benson's argument, however, the committee was clearly getting ready to write a package farm program of its own, embodying most of the President's relief measures, plus the re-establishment of rigid high price supports. Already, eight of the 15 committeemen--including three Republican Senators--favored such a package deal. Senate and House Republicans alike doubted that the President would dare to veto such a bill in an election year in the teeth of loud discontent in the farm areas. "I don't see how he could," said one Republican veteran.

But Ezra Benson is a determined man. The toughest farm policy fight in years seemed to be boiling up.

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