The Nonpartisan Leader Newspaper, July 26, 1917, Page 9

* months, Hoover Shows Food Robbery Finds No Justification for System That Beats Down Prices to Farmers and Raises Them to Consumers—Government Must Stop It OOD speculators, having rob- bed the consumer with $17 flour, are now forcing wheat 5 prices down so that the 1917 crop may be bought at bar- gain rates from the farmers and while they have been doing this congress has been killing time on the food bill with" unending debate. July 10 saw two events happen that disturbed the peace of mind of the food gamblers and their talkative friends in congress. One was the elec- tion, in the North Dakota congressional district, of John M. Baer, Nonpartisan. Bear is now in Washington, D. C., ready to start work for the farmers. The other event of July 10 was President Wilson’s action in serving notice on congress that more work and less words would be necessary if the American producers and consumers were to be protected on this year's crop. President Wilson made public a letter written to him by Herbert C. Hoover, who will be appointed food administrator when the bill is finally passed. - In this letter Hoover ex- plained in detail why it is necessary that immediate action be taken; Mr. Hoover’s conclusions may bhe sum- marized as follows: GREATER PROFITS IF BILL DELAYED An extortionate profit was made by speculators and middlemen in the 1916 crop. . 'The United States will attempt to export more wheat this-year than in ncermal years. The shortage of ships will mean con- gestion and shortage of storage facili- ties this year and with the allied gov- ernments making purchases through a ‘single agency, unless the market is protected by government action, a bad glut will occur and prices will be forc- "ed far below the normal level. . Greater profits by speculators than .in 1916 are probable unless the govern- .ment is granted authority to take ac- tion. Mr. Hoover proposes that the gov-. ‘ernment stabilize the market by buy- ing surplus wheat at a reasonable price and that foreign buyers be induced to take flour instead of wheat. This will both save shipping' space and keep tha by-products in the United States. Mr. Hoover said in his letter: “The experience this year in the -rampant speculation, extortionate prof- its, and the prospect of even narrower supplies than 1916 harvest and carry over, must cause the deepest anxiety. No better proof of the hardship worked upon our people during the past year need be adduced than the recitation of the fact that the producer received an average of $1.51 per bushel for the 1916 wheat harvest, yet wheat has been as high as $3.25 at Chicago, and the price of flour has been from time to time based upon this speculative price of wheat, so that through one evil cause or another, the consumer has suffered from 50 to 100 per cent, and the producer gained nothing. “After much study and investigation it is evident that this unbearable in- crease in the margin between producer and consumer is due to not only rank speculation, but more largely.to the wide margin of profit demanded by every link in the chain to insure them from the great hazards of trade in the widely fluctuating and dangerous price situation during a year when all Jqormal stabilization has been lost through the interruption of world trade and war. FARMER MAY GET BADLY STUNG YET “During recent months the allied governments have consolidated their buying into one hand in order that they might relieve the burden of speculation from their own consumers, and as the restricted exports to neutrals are but a minor item, the export price, if not controlled, is subject to the will of the allied buyer, so that in a great measure the American producer is left to that buyer’s judgment and is without voice. Furthermore, in normal circumstances United States and Canadian wheat is moved to Kurope largely in the fall such shipments averaging about 40,000,000 bushels per month, and relieving a corresponding flow from the farms into the interior terminals, Thig year,” owing to the shortage of shipping, the allied supplies must pro- - - ¢eed over a large period of the year and will not during the fall months ap- parently averdge over 20,000,000 to 25,- 000,000 bushels per month. We must, HERBERT C. HOOVER SAYS: ‘‘The producer received an average of $1.51 per bushel for the 1916 wheat harvest, yet wheat has been as high as $3.25 at Chicago. * * #% Through one evil cause or another the con- sumer has suffered from 50 to 100 per-cent and the producer gain- ed nothing. ‘‘This unbearable increase in the margin between producer and consumer is due to not only rank speculation but more largely to the wide margin of profit demanded by every link in the chain. ‘“‘Most of the allied countries have fixed the price of wheat to the farmer at about $1.80 per bushel and many of their pro- ducers believe that as allies it is our duty to furnish wheat at a price which delivered to them will not exceed their domestic price, in other words, about $1.50 per bushel, Chicago. Neither their responsible officials nor I hold this view because I consider that . . . o ! . . the stimulation to produection, if no other reason, is in the long run in the_interest of the allies. ““In order to do justice to the producers who have shown great patriotism in a special effort to inerease production in 1917 and to further stimulate the efforts of 1918, it is absolutely vital that we shall proteet the farmer from slump in price-this year.”’ —(Irom letter of Herbert C. Hoover to President Wilson). therefore, expect a glut in our interior terminals-during a considerable period. “The net result oY this situation is that unless some strong and efficient government action is immediately set- tled and brought into play the Ameri- can producer will face a slump in wheat, and in any event the price of export wheat will ‘be dictated by a sin- gle agency, and the American consum- er will be faced with the situation that a large part of the essential breadstuff has passed into the hands of speculat- ors, for some one must buy and hold not only the normal flow from "the ‘farmer but this probable glut. “In order to do justice to the pro- ducers who have shown great patri- The Way to Do It otism in a special effort to increase production in 1917 and to further stim- ulate the efforts of 1918, it is absolute- ly vital that we shall protect the farm- er from a slump in price this year, due to a glut as above or from the uncon- trolled decisions of any one buyer. I am informed that most of the allied countries have fixed the price of wheat to the farmer at $1.80 per bushel, and many “of their producers believe that as allies it is our duty to furnish wheat at a price which delivered to them will not exceed their domestic price; in other words, about $1.50 per bushel, Chicago. “Neither their responsible officials nor I hold this view, because I consid- Try Old Game (From the Wells County Free Press) ‘We wonder why all the Twin City dailies keep on telling the world what a big crop the Northwest is raising this year. If they think that residents of this section -want misinformation regarding conditions here to be print- ed, they are mistaken. Or is it the same old game of creating a bearish sentiment for the big wheat kings to get a chance at buying the farmers’ crop at as low aprice as possible? The Northwest is not going to have a’ big crop of anything except, perhaps, in small districts. The situation is well told in a paragraph in the Minot In- dependent: - 3 “The farmers of northwestern North PAGE Dakota have taken heart after a series of good rains which visited many sec- tions on the Fourth. They do not hope to raise much of a crop this year, in fact under the most favorable condi- tions, they cannot hope to produce more than a quarter to a half an or- dinary crop, but the rains mean much to them. It means that they will prob- ably be able to rake and scrape to- gether enough feed for their stock, al- though this will be by no means an easy matter. Oats and barley ought to be a fair crop where the- raing fell the heaviest. Flax will probably come along nicely with chances for matur- ing. Some fields of wheat may make a half crop. The conditions are not sat- isfactory but they are much improved.” er that the stimulation to production, if no other reason, is in the long run in the interest of the allies. There is, however, a limit to price which so trespasses upon the rights of the con- sumer as to defeat its own object through strikes, rises in wages, and social disturbances in the country. “Three facts stand out plainly enough from our investigations: First, that in this situation the farmer will need Protection as to the price of wheat, and, second, that large masses of peo- ple in the consuming centers are be- ing actually undernourished today, due to the exorbitant cost of living; and these conditions, unless some remedy be found, are likely to grepeat them- selves in even more vicious form at this time next year; third, the specu- lator, legitimate or vicious, has taken a large part of the money now being paid by the consumer. COVERNMENT SHOULD s BUY THE SURPLUS “It seems to be overlooked in some guarters that the marketing of this year's wheat is surrounded with cir- cumstances - new to history *and that the old distributing safeguards are torn away by isolation from the recip- rocal markets abroad and the extine- tion of a free export market and free export transportation. The harvest has begun to move, and from .these very causes the price of wheat has be- gun to drop; and if the farmer is to séll his wheat either the speculator must return to the market to huy and carry not only the normal flow from the farmer in excess of domestic and foreign requirements, but also the glut due to the restriction upon the outlet to the latter. He must necessarily charge his toll to the producer and the consumer, and this latter probably upon a more extensive scale than last vear, as his risks will be greater. ll’rac- tically, the export buyer must fix his own price for export wheat from the sole outlook of his own clients, and in execution of his duty he will, in all normal circumstances, follow the market down by buying only his time- to-time requirements, as he can not be expected to carry the load of our domestic accumulation. “Or, on the other hand, the govern- ment must buy the surplus wheat at some reasonable minimum price allow- ing the normal domestic trade of the country to proceed with proper safe- guards against speculation. Nor would the services of the speculator be ne- cessary, for the government should be able to stabilize the price of whedit without his assistance and can control the price and quantity of export wheat. “We are practically helpless to safe- guard either the farmer or the con- sumer until the. pending legislation is passed.” HAMMER PRICES DOWN Corn sold the other day on the Chi- cago market for $1.70 per bushel while number 4 wheat brought only $1.17, . This is a rank injustice to the wheat- grower because an acre ‘will produce twice as much corn as wheat. If corn is $1.70 wheat ought to be $3.40. Thera is a systematic effort on foot to ham- mer down the price of wheat, this year in the face of a world shortage and in spite of wserious crop conditions in many parts of the country. Is govern- ment interference with the machinery of distribution responsible, or, are the wheat kings just: getting the skids ready for the new crop?—LITCH- VILLE (N. D.) BULLETIN, THE NEW CONGRESSMAN The victory of J. M. Baer, candidate for congress in the First district, is emphatic enough to show the trend of public sentiment in that part of the state. The vote 'in the towns for the | Nonpartisan®candidate was surprising- 1y large, possibly indicating that the organized labor leaders of the towns were in sympathy with the farme candidate. The election has a great deal more significance than an ordinary contest for a successor to a North Da- kota congressional vacancy and Con- gressman-elect Baer's course in the house of representatives will be watch- ed with great interest, not only by the voters of his district, and state, bhut will have attached to it a measure of importance throughout the - entire country. North Dakota is taking the lead in certain new farm movements that belong exclusively to a new politi- cal policy, which the times and the logic of past conditions and recent great events are forcing into activity, —DAILY ALERT, Jamestown, N. D.