The agricultural programs contemplated for the fiscal year 1947 are those
which are essential for the provision of an adequate supply of food and
other agricultural commodities with a fair return to American farmers. To
support these objectives, expenditures by the Department of Agriculture
estimated at 784 million dollars from general and special accounts will be
required in the fiscal year 1947. This compares with estimated expenditures
of 676 million dollars in 1946. These figures exclude expenditures by the
Department of Agriculture on account of lend-lease, the United Nations
Relief and Rehabilitation Administration, and other war expenditures. The
expenditure for the fiscal year 1947 is composed of 553 million dollars for
"aids to agriculture," 35 million dollars for general public works, and 196
million dollars for other services of the Department.
Net outlays for the price stabilization, price support, and other programs
of the Commodity Credit Corporation are expected to increase from about 750
million dollars in the fiscal year 1946 to about 1,500 million dollars in
1947. Cash advances made on loans by the farm Security Administration and
the Rural Electrification Administration are expected to amount to 266
million dollars in the fiscal year 1946 and 351 million dollars in 1947;
and after receipts from principal and interest are taken into account, net
loan expenditures of these two agencies will amount to 120 and 209 million
dollars in the two fiscal years.
To provide for the expenditures from general and special accounts, I
recommend for the fiscal year 1947 appropriations of million dollars
(including the existing permanent appropriation of an amount equal to 30
percent of estimated annual customs receipts) and a reappropriation of 88
million dollars of prior-year balances from customs receipts. In addition
there is a recommended authorization of 367.5 million dollars for borrowing
from the Reconstruction finance Corporation for the loan programs of the
farm Security Administration and the Rural Electrification Administration.
It is expected that the operations of the Commodity Credit Corporation will
be financed during the coming year through the 500 million dollars of
lend-lease funds which the Congress has earmarked for price support
purposes, a supplemental appropriation to restore impaired capital of the
Corporation, and the borrowing authority of the Corporation.
Some detailed recommendations follow for major agricultural programs.
Conservation and use of land.--I am recommending that 270 million dollars
be appropriated for "conservation and use of agricultural land
resources"--the so-called AAA program--for the fiscal year 1947, compared
with 356 million dollars in the current year. This reduction of 86 million
dollars is in large part accounted for by elimination of the wartime flax
production incentive project and other nonrecurring items; the proposed
reduction in normal activities is less than 33 million dollars.
For the past several years, this program has consisted largely of payments
to farmers for application of fertilizer and other approved soil management
practices. I am convinced that farmers generally are now fully alert to the
benefits, both immediate and long-term, which they derive from the
practices encouraged by this program. I believe, therefore, that this
subsidization should continue to be reduced.
Rural electrification.--It is proposed that the loan authorization for the
Rural Electrification Administration for the fiscal year 1947 be increased
from 200 million dollars to 250 million dollars. During the war period, REA
was limited by the scarcity of materials and manpower. But that situation
is rapidly changing, and the REA program, which was materially stepped up
for the fiscal year 1946, can be increased still more. It is my belief that
a feasible and practical rural electrification program should be carried
forward as rapidly as possible. This will involve total loans of
approximately 1,800 million dollars over the next 10 years, much of which
will be repaid during that period.
Other programs.--It is recommended that the continuing forest
land-acquisition program be resumed at the rate of 3 million dollars
annually, which is about the minimum rate at which this program can be
economically carried on. The lands involved in this program can contribute
fully to the national welfare only when brought into the national forest
system for protection and development.
Such programs as those of the farm Security Administration and the farm
Credit Administration are estimated to be continued during the fiscal year
1947 at about the same level as in the fiscal year 1946. Recent action by
the Congress has Permitted some expansion of the school lunch program. I
hope it will be continued and expanded. The budgets of the Federal Crop
Insurance Corporation and the federal farm Mortgage Corporation will be
transmitted in the spring under the terms of the Government Corporation
Control Act.