One of the difficult problems which face the new administration is that of
the slow, irregular decline of farm prices. This decline, which has been
going on for almost 2 years, has occurred at a time when most nonfarm
prices and farm costs of production are extraordinarily high.
Present agricultural legislation provides for the mandatory support of the
prices of basic farm commodities at 90 percent of parity. The Secretary of
Agriculture and his associates will, of course, execute the present act
faithfully and thereby seek to mitigate the consequences of the downturn in
farm income.
This price-support legislation will expire at the end of 1954.
So we should begin now to consider what farm legislation we should develop
for 1955 and beyond. Our aim should be economic stability and full parity
of income for American farmers. But we must seek this goal in ways that
minimize governmental interference in the farmers' affairs, that permit
desirable shifts in production, and that encourage farmers themselves to
use initiative in meeting changing economic conditions.
A continuing study reveals nothing more emphatically than the complicated
nature of this subject. Among other things, it shows that the prosperity of
our agriculture depends directly upon the prosperity of the whole
country--upon the purchasing power of American consumers. It depends also
upon the opportunity to ship abroad large surpluses of particular
commodities, and therefore upon sound economic relationships between the
United States and many foreign countries. It involves research and
scientific investigation, conducted on an extensive scale. It involves
special credit mechanisms and marketing, rural electrification, soil
conservation, and other programs.
The whole complex of agricultural programs and policies will be studied by
a Special Agricultural Advisory Commission, as I know it will by
appropriate committees of the Congress. A nonpartisan group of respected
authorities in the field of agriculture has already been appointed as an
interim advisory group.
The immediate changes needed in agricultural programs are largely budgetary
and administrative in nature. New policies and new programs must await the
completion of the far-reaching studies which have already been launched.