The Nonpartisan Leader Newspaper, July 22, 1918, Page 12

The Truth About the Farmers® Profits After Allowing 5 Per Cent on the Investment the Average Income, Including the Living, Is $318.12, the Department of Agriculture States e S FARMING a business, or is it merely a job? It is time for every farmer to ask himself this question. According to our agricultural colleges, our United States department of agriculture and our farm papers farming is not only a business, but it is a business second to none in the country and capable of the highest and most efficient organization, and to returns on the outlay as big as any other business. But according to actual average farm conditions all over the United States and according to cold, unsympathetic census figures, farming is merely a job where the farmer risks a considerable invest- ment, employs labor and gets less than wages for himself out of it, to say nothing of utterly failing to get anything whatever on the investment. The census of 1910 shows that the 6,631,502 farmers in the United States received $5,487,000,000 for their produce on a farm investment amounting to $40,991,499,090. This means that the average total gross income per farm was only $827.41 that year and that the average farm investment was $6,181.32. NOT EVEN A DECENT WAGE This $827.41 does not even cover the question of . wages for the average farmer, the help he gets from his family, and “outside” hired help. It doesn’t touch the question of seeds and other raw materials he had to use. It does not provide for any interest on his investment whatever. THE AVERAGE FARMER IS ACTUALLY WORKING FOR LESS THAN WAGES AND GETTING NO INTEREST WHATEVER ON HIS INVESTMENT. This is the way the United States department of agriculture sums. up the general results .of the farmer’s “business” in a report issued in August, 1917: “The average income of the farm families of the United States, which represents what the . farmer gets for his labor and managerial ability, after allowing 5 per cent on the investment, was shown to be, by an intensive investigation by the department of agriculture, $318.12 for 12 months. This includes what he received toward his living from the farm and therefore represents the total income of the family.” i This means that counting all the farmer and his family use of their own farm produce, the average farmer gets only $318.12 a year and 5 per cent on ¢ his investment. The average farm investment is now estimated at $6,444. Five per cent of this is $322,20. THIS MAKES THE AVERAGE FARM INCOME, ACCORDING TO THE DEPARTMENT . OF AGRICULTURE, $640.32 PER YEAR. THIS ; ISN'T EVEN DECENT WAGES FOR ONE MAN, i NOT TO MENTION PAY FOR HELP, AND IN- TEREST ON INVESTMENT. . From this we see that farmmg as it is now con- ducted in the United States is not a business; it is not even a good job., ' PRODUCTION IN : WAR AND PEACE Much is now being said about how to make farm- . ing a good business. Most that is being said is- | not comprehensive. It does not touch all the fac- I tors involved. In most cases it does not touch i the main ones. These schemes usually concern i| themselves wholly with telhng the farmer how to double and treble his crops, or how to properly ¢ diversify .them. . War needs, of course, demand ‘1 productlon above all thmgs and the farmers are " loyally rising to the occasion. ‘But after the war, | there will be an effort to return to the old inefficient . marketing methods. It looks reasonable that if I-double my crops, I will ‘'double my income. Just like 2 and 2 are 4. | Strange to say 2 and 2 are not 4 when it comes to gettmg bigger money out of bigger crops, as many Bigger crops, N i a farmer has found to his sorrow. in the old days of peace, before price-fixing, gen- erally meant lower prices and less money, as any experienced farmer will testify. The crux of the farm problem is not bigger crops but better con- trol of the market and better prices. The only way the farmer could benefit by rais- ing bigger crops is when his neighbors, that is when the majority of the farmers, did not raise bigger crops. If we could make the farmers believe that their economic salvation lay in raising more produce, and the majority would raise bigger crops the same year, farm produce would, under peace conditions, become a drug on the market and would go begging for takers at almost any price. The average farmer would make less money than in years of normal crops. As long as we succeed in persuading only a few farmers to improve their methods of farming and raise bigger crops, these few will benefit by this appeal and will realize bigger incomes than their neighbors. But this is a business method that can not be applied to all or a majority of the farmers. It defeats its own purposes by causing an overpro- duction of farm products. About 7,000,000 farmers are now supplying the people of the United States from year to year with all the farm produce they can buy and absorb. This makes an average of $863 worth of farm produce at present prices to the farm. It is useless to talk about increasing the farmer’s income by raising bigger crops until we have expanded this market until it will absorb bigger crops. THE FIRST PROBLEM OF TURNING FARM- ING INTO A BUSINESS IS IMPROVING THE MARKET SO IT WILL ABSORB THE MAXIMUM AMOUNT OF FARM PRODUCE. THE IMPORTANCE OF THE HOME MARKET A great deal has been said about the wvalue of foreign markets to farmers. Politicians have held this will-o’the-wisp before farmers’ eyes for more than a generation and have involved farmers so much in a fight among themselves over tariff and free trade issues, that they have lost the true per- spective of markets. is not important. ONLY 4 PER CENT OF THE AMERICAN FARMERS’ PRODUCE IS EX- PORTED; 96 PER CENT IS CONSUMED AT HOME. THE BIG QUESTION WITH THE IF{‘%RMER IS EXPANDING THE HOME MAR- T. We live under a system where the majority of the people are never able to buy all they want of any- thing. UNDER THIS KIND OF SYSTEM THE MARKET MEANS WHATEVER THE PEOPLE ARE ABLE TO'BUY. Our markets can be ex- panded in almost any.direction by increasing the average income of the people. the people of the United States are wage earners. These wage earners live in the towns and the cities. They constitute the overwhelming majority of the inhabitants of these towns and cities. THE WAGE EARNERS '‘ARE THE FARMERS’ HOME MAR- KET, AND THEIR CONDITION IS MORE IM- PORTANT TO THE FARMERS’ PROSPERITY THAN ALL OUR FOREIGN MARKETS. IN- CREASE WAGES IN THE UNITED STATES 20 PER CENT AND YOU HAVE EXPANDED THE MARKET FOR FARM PRODUCTS FAR MORE THAN ALL THE FOREIGN MARKETS IN THE WORLD WILL EVER AMOUNT TO. It is a good business for the farmer to see in a clear and broad light that his interests are bound up economically. with the interests of tHe town workers; that they are his market; that one of the big farm problems is getting farm products to these consumers by ‘as short a route and as cheaply as possible, so that the producer and the consumer will realize the money thus saved.” It is good’ politics' for the farmer to co-operate politically with the city wage earner to the end that both shall have their share in the control of government, so that nenproducers may be eliminated and market PAGE TWELVE .. ; ; b i The foreign market question The majority of: conditions improved for both producers and con- sumers. But improving the home market by helpmg the people to become-better-consumers is only the first step toward real business' farming. THE MAIN PROBLEM IS-SECURING EQUITABLE PRICES FOR WHAT.THE FARMER RAISES. THIS IN- VOLVES THE-PROBLEM: OF CONTROL OVER MARKETING ‘AND-PRICE-FIXING. '"MUST CONTROL THE MARKETS We do not realize what a big question this is and what enormous promises it holds out until we begin to compare farming with some other industry that is actually on a business basis. According to " the 1910 census, the same year that 6,631,502 farm- ers and their help on a capitalization of $40,991,- 449,090 were producing an output they sold for $5,487,000,000, 7,678,578 owners and workers in the manufacturing industry employing $18,428,270,000 worth of capital, turned out a product they sold for $20,672,052,000. The farmers with their hired help outnumbered the manufacturing people. Farm investments totaled more than twice as much as manufacturing investments. The products from. the farms were worth more to the nation than the products from the factories. Yet the manufacturers managed to sell their output for more than four tlmes as much as the farmers sold theirs. There are three main reasons why the manufac- turers received so much more for a product that was really worth less to the nation: 'THE MANU- FACTURERS WERE ORGANIZED; ' THEY MAINTAIN A CONSIDERABLE CONTROL OVER ' THE MARKETING OF THEIR OWN PRODUCTS; THEY DEVOTE PRACTICALLY AS MUCH ATTENTION' TO SELLING THEIR PRODUCTS AS THEY DO TO MANUFACTUR- ING THEM. Most of the manufacturers in the United States are organized in the Manufacturers’ association. Its members pay dues, send delegates to annual conventions, determine conditions in their gtreat industry, and take a prominent part in politics and government.. Most of the manufacturing enter- . prises of importance are included in some monopoly. BIG BUSINESS IS ORGANIZED As a result of this organization, monopoly and attention to marketing the manufacturer realizes a gross return of 41 per cent on his investment. The farmer, who is not organized, who is a victim of monopoly, and who has surrendered the market- ing of farm products to ‘middlemen monopolists, after foregoing all wages for himself and family, -realizes only 14- per cent interest on his invest- ment. If he received prices corresponding to the .manufacturers the average farm income would be $2,642 a year. It is up to the farmer to take the control of the market out of the hands of the middlemen if:: he wants to put farming on a business basis. He can do this by using his political power to establish the public ownership of the big marketing and finishing facilities such as railroads, elevators, flour mills, stockyards, packing plants, warehouses, cold storage plants, ete. § With the market and the big marketing facili- ties under the control of the public, and the farm- ers and city workers—in other words, the great producing and consuming classes—constituting an overwhelming majority of the public, " market prices and conditions will be determined in the interest of the producers and consumers. ‘When' the great body of producers and consumers through state and the national governments ‘con- trol market conditions, the needless -waste of the present system of marketing, entailing the passing’ of products through so many hands, will be elim- inated.. The values: thus saved wfll go: to the pro- ducers: a'nd consumers. < b} ) S RS fi»:mnunmufrw”f@'%khfi“mm ‘ )