The Nonpartisan Leader Newspaper, September 6, 1917, Page 5

¥ Wheat Price Soaks Farmers Price-Fixing Commission Determines on $2.20 at Chicago for No. 1— Mlllers Satisfied With Result Which Spells Ruin for Many Farmers g . I b VRS | W% i IO il goo BLESS OUR HOME- o [} < poaacsle, Ry . B. O. Foss, one of the Leader cartoonists, drew this picture when he heard that the food administration had fixed $2.20 at Chicago for No. 1 wheat as the price at which the crop will be commandeeret this year. The president and Food Administrator Hoover had promised the farmers a “liberal” price—one that would “stimu- late production.” Well, the meal the price-fixing commission is serving up to the big husky farmer, doesn’t look very “stimulating,” does it? Foss has the whole idea well pictured. The farmer has to meet that mortgage sticking out of his pocket—he added to that to put in a greater acreage this year. And the crop was poor in most sections and farm costs have doubled. When you look at this kind of a meal. WO dollars and twenty cents for No. 1 wheat at Chicago. This is the base price that:the government price-fixing com- mission has settled upon for this year’s crop. No. 2 of each grade is to be 3 cents less.than this base price; No. 3 is to be 6 cents less than the base price; No. 4 is to be 10 cents less than the base price. Prices at Duluth and Minneapolis will be 3 cents off the Chicago price. The . food administration’s plan means practically commandeering the crop at these prices. While the farm- ers themselves and strictly co-opera- tive elevators are permitted to hold wheat as long as they want to, all other elevators are compelled to move it within 30 days. This storage limit and the fact that the government has organized a great wheat buying and selling corporation to buy wheat for millers and for exportation at the price fixed, will result in keeping the price at the low level fixed. At least Food Administrator Hoover declares this will be the effect. The government also has control of the transportation situ- ation, so that it is not believed that farmers or co-operative elevators can gain a higher price by holding wheat. PRICE SEVERE BLOW * TO MOST FARMERS President Wilson and Food Admin- istrator Hoover promised the farmers a “liberal” price this year, one that would “stimulate production.” On this promise the farmers sowed extra acre- age. They gave up big money-making non-food crops like flax in order to sow more wheat. The government’s promise meant farmers would get more than the cost of production. It meant they would get a “liberal” margin above cost, a margin that would “stimulate production.” But they in fact get far from a liberal price. Two-twenty at Chicago. for No. 1 means a fair return for farmers who got big crops of good grade wheat. But in some states, like North and South Dakota and Montana and‘ parts of Minnesota, crops were poor—below the average in yield—and some farmers got little or no crop. The government’s price for these farmers is a severe blow. The cash price for wheat on the day the government announced it would fix a price was $3.06, and Sep- tember wheat was then quoted at $2.50. For years so-called “supply and demand”—the fixing of prices through the grain exchanges—has hammered wheat down below cost of production. The 1915 crop, a tremendously big one, sold at around 85 cents, and there was less money in it than in some smaller crops. The 1916 crop sold at around $1.50 for No. 1, but the “sup- ply and demand” fellows, really the grain combine, invented “feed” grades, into which most of the crop fell, and farmers really got less than an average of 90 cents for wheat in 1916. Thus for two years existing price-fixing machinery hammered the farmers’ returns down below cost of production. And in 1916 the crop was mostly all lost through rust and other diseases. . ‘Now, when the pendulum swings back the other way in 1917—when the wheat gamblers and price manipulators lose control and a genuine shortage of wheat promises to recoup farmers for the two former years' losses—in steps the government and fixes a price away under the' market price—in many if not most instances -below the cost of production. A significant thing is that immedi- ately on the announcement of the price the government fixed, the big millers all over the country gave out statements declaring the price more than fair. The millers have wanted a low price. The grain gamblers have wanted a low price. All the Big Busi- ness combinations the farmers have been fighting have wanted a low price. They have wanted it because they think it will discredit government con- trol with the farmers. If the farmers, by a low price of wheat forced upon them, can be made to be Iimpatient with government control, it will make it easier to discredit government con- trol of all kinds of Big Business. This will let the middlemen and war prof- iteers get away with their huge war profits, FARMERS ORGANIZED— THAT HELPED A LOT The wonder is that a price even lower than $2.20 was not fixed. The stage was all set to fix a price much under $2. But this plan leaked out, the farmers made such a clamor that consideration of a price under $2 was dropped. The farmers’ congressman, John M. Baer, did heroic work at ‘Washington. He.was on the job night and day. The Nonpartisan league sent William Lemke and a committee to ‘Washington. The Nonpartisan Leader was instrumental in having over 1000 League farmers telegraph Dr. E. F. Ladd, member of the price-fixing com- mission, giving him their estimates of the cost of producing wheat. And these telegrams all showed the cost to be $3 or over a bushel. Farmers’ meetings everywhere insisted that at least $3 be fixed as the price. The one big fact that caused the price finally to be fixed at $2.20 in- stead of at $1.65 or $1.75 was that in the spring wheat states the farmers were solidly organized- The Nonpartisan league ., numbers practically all the wheat farmers in North Dakota and probably half of them in Montana, South Dakota and Minnesota. Congressman Young of North Dakota, during the sitting of the price commission, in PAGE FIVE picture you wonder how the price-fixing commission had the nerve to dish up this a telegram saying that at last the plan for a price less than $2 had been dropped, declared that the fact that the farmers were so well organized was the principal reason that a more nearly fair price was being considered. The farmers’ or- ganization and what it had done end could do loomed big on the horizon at Washington. And the fact that it was there, ready to do business, counted more than all the committees the commercial clubs and business men sent. The government has promised to fix flour prices now—not by a commission that will sit and determine the price as in the case of the price of wheat, but by “patriotic co-operation” of the millers. Tood Administrator Hoover has already announced what the agree- ment with the millers is. It is that they will be allowed 25 cents a barrel profit on flour and 50 cents a ton profit on feed. They are to get their wheat at the price the government has fixed. To the cost of the wheat they are to be allowed to add the cost of milling. And then, above these costs, they are to be allowed the profits above stated. Mr. Hoover says millers have been making $6 to $8 a ton on feed—that their big profits have been in feed. His statement that only 50 cents a ton profit will be allowed 'on feed means that feed ought to be $5.50 to $7.50 a ton less soon. Will it? The food ad- ministration and the millers have not yet agreed on the cost of milling and - other details, so that the final price of . flour, with wheat at $2.20, has not been announced. Mr. Hoover believes that $2.20 wheat is a liberal price that will stimulate production. He said he thought $2.10 filled those requirements, when ques- tioned about it at a time when it was thought the price would be $2.10. Whether it will stimulate production or not remains also to be scen. F et et S 2 R T S 2D e R