which the said dairy farmer would otherwise have been eligible based on deliveries from such farm. Provisions shall also be made for allocating to any new producer under an order who was not engaged in dairy farming prior to the incorporation in the order of provisions hereunder an equitable share of the allocated sales on such terms and conditions as prescribed in the order, due consideration being given to the current and prospective supply conditions in the regulated market. The application of allocations hereunder shall be subject to such provisions as may be incorporated in the order under section 8c (5) (D). Allocations to producers under this subparagraph may be transferable under an order on such terms

and conditions as may be prescribed if the Secretary of Agriculture determines that transferability will be in the best interest of the public, existing producers, and prospective new producers. The allocations or bases hereunder may be adjusted from time to time or new allocations or bases may be established by amending the order or under provisions incorporated in the order;

“‘(ii) that in distributing to producers the amounts of money required to be paid by handlers on milk each producer shall be paid (1) for milk delivered by him which exceeds his allocation at the lowest class price specified in the order and (2) for milk delivered by him within his allocation a blend price, based on utilization in such higher class uses plus reserve, representing his pro rata share of the remaining funds available for current distribution to producers under the order, after the computation has been made under

(1) hereof. The payments under (1) and (2) above shall be subject to adjustments prescribed in the order under section 8c (5) (B) or other provisions of the Act and to such provisions as may be incorporated in the order under section 8c (5) (D);

"(iii) in marketing orders where individual handler pools are approved as provided by subparagraph 8c (5) (B) (i) the provisions of this subparagraph may be applied to each handler individually and to the producers delivering milk to such handlers;

"(iv) in the case of any producer who during any accounting period delivers a portion of his milk to persons not fully regulated by the order, provision may be made for reducing the allocation of, or payments to be received by, any such producer to compensate for any marketings of milk to such other persons for such period or periods as necessary to insure equitable participation in marketings among all producers.

"(v) the order may provide for such reports and the keeping of such books and records by producers and by the person or persons to whom he may dispose of milk as the Secretary may prescribe and upon request of the Secretary such person or persons shall make required records available for inspection;

"(vi) the provisions authorized under this subparagraph may be made applicable to a regulated handler's own production of milk;

"(vii) order provisions under this subparagraph shall not become effective in any marketing order unless separately approved by producers in the same manner provided for the approval of marketing orders. Disapproval of order provisions under this subparagraph shall not be considered disapproval of the order or of other terms of the order. Order provisions under this subparagraph may be terminated separately whenever the Secretary makes the determination with respect to such provisions as is provided for the termination of an order in section 8c (16) (B);

"(viii) Any producer for whom an allocation or base is established under the author

ity of this subparagraph may obtain a review thereof as prescribed by the order and rules and regulations thereunder, which shall constitute the exclusive procedure for review thereof and section 8c(15) (A) of this title shall not apply thereto. Under such order, rules, or regulations any officers or employees of the Department or any committees or boards of producers under the order created for the purpose may be vested with authority to perform any or all functions in connection with such review proceedings, including ruling thereon. Committees or boards created for this purpose shall be deemed agencies of the Secretary within the meaning of subsection 8c (7) (C) and section 10 of this title. The ruling upon such review shall be final if in accordance with law. The producer may obtain a judicial review of such ruling in accordance with the provisions of section 8c (15) (B) of this title; and

"(ix) the provisions of section 8a (5) shall not apply to any producer in the application of this subparagraph or regulations issued pursuant thereto.'"

Mr. PROXMIRE. Mr. President, on my amendment, I ask for the yeas and nays.

The yeas and nays were ordered. Mr. PROXMIRE. Mr. President, I yield myself 15 minutes.

Mr. AIKEN. Mr. President, will the Senator from Wisconsin yield?

Mr. PROXMIRE. I have yielded myself 15 minutes to explain the amendment. I shall be happy to yield to the Senator from Vermont after I have finished my explanation.

Mr. AIKEN. I wish to make sure that the Senate understands the intent of the Senator's amendment. Will the Senator from Wisconsin, after he has made his presentation, permit me to ask him several questions?

Mr. MANSFIELD. Mr. President, I ask that there be order in the Chamber and that attachés who have no business to attend to be requested to leave the Chamber.

The PRESIDING OFFICER (Mr. TYDINGS in the chair). The Senator's point is well taken. The attachés will please leave the Chamber if they cannot be in order.

Mr. AIKEN. Mr. President, after the Senator from Wisconsin has finished his opening remarks, will it be agreeable to him to permit me to ask clarifying questions on the various sections of the amendment, so that there will be no mistake in the RECORD as to exactly what each section and each part of the amendment means?

Mr. PROXMIRE. I should hope that we could use that time on both sides as equally as possible.

Mr. AIKEN. Mr. President, with that understanding I do not intend to interrupt the distinguished Senator from Wisconsin while he is speaking. rupt the distinguished Senator from

Mr. PROXMIRE. Mr. President, I thank the Senator.

This amendment would insert in the Food and Agriculture Act of 1965, as it was reported by the Committee on Agriculture and Forestry, a new dairy title.

The amendment is identical with S. 1915, the Proxmire dairyman's class I base plan. It is also quite similar to title I of H.R. 9811, as it was passed by the House of Representatives.

Mr. President, this amendment would increase farm income, according to the Department of Agriculture.

It would reduce the cost of the farm program, according to the Department of Agriculture.

It would not increase the cost of milk to the consumer. The amendment has been tried and won enthusiastic support in British Columbia, where it succeeded in increasing farm income with no increase in cost to the consumer.

The amendment is strictly permissive. At least two-thirds of the farmers in a particular market order must vote in favor of the plan before it would go into effect in their market order. A simple majority vote can cancel the plan.

In testifying before the Senate Committee on Agriculture and Forestry this year, Secretary of Agriculture Freeman supported this proposal. In doing so, he said:

Enactment of legislation authorizing the use of base plans in Federal milk order markets would be a step in the right direction. In markets where producers elected to adopt a base plan, as provided for in this bill, there would be an incentive to hold down increases in milk production. This would help reduce present surpluses to the benefit of all.

It would not impose barriers on the entry of new producers to markets adopting a base plan. Its provisions would leave the door open for needed, yet equitable adjustments within the industry.

This amendment is identical with the bill which passed the Senate by a 45-to33 vote in the fall of 1963. It is similar to, but not identical with, title I of the farm bill as it passed the House of Representatives this year. That title was deleted by the Senate committee.

At present, farmers selling milk for fluid consumption in marketing order areas receive a blend price for that milk. That "blend" is made up of two prices-first, a relatively higher price for the part of the milk that actually goes into fluid consumption; and, second, a relatively lower price for the excess which goes into cheese, ice cream, and so forth.

Regardless of how much the farmer produces, he receives the single blend price.

Dairy farmers object to this practice, because, as farmers producing under the same marketing order increase their production, the production going into excess increases and the blend price drops lower and lower.

This is how the amendment would permit the farmers to modify the blend price system:

If two-thirds of the farmers in a market order area vote to do so, they can end the blend price system for their own particular order.

Instead, they could receive the high fluid price for that part of their production that goes into fluid milk, and the lower, excess price for that part of their milk that goes into excess production. This has two advantages.

First, it would enable the farmer to protect himself against overproduction by other farmers under the order. This is because the farmer could count on the established fluid price, and that fluid

price would not be diminshed by increased excess production, as is the blend price.

Second, overall milk production would decline. The burden on the taxpayerwhich has been several hundred million dollars a year-to pay for acquiring excess milk production would be reduced considerably. This is because farmers would receive a lower excess price for all their increased production, rather than the higher blend price which they now receive.

Mr. President, let me mention some of the things this amendment would not do. I want to make it crystal clear that the freedom of action now existing under milk marketing orders would in no way be affected. It may be suggested that this amendment makes many modifications in existing law. I believe this is because of a misapprehension. amendment would only do one thing. It would provide farmers with an option on the kind of system under which they would be compensated for their milk in fluid milk areas, and nothing else.

This

tabulation showing in detail the amount delivered under Federal order markets, the average surplus price, and the approximate value of this surplus since 1947.

There being no objection, the tabulation was ordered to be printed in the RECORD, as follows:

ducers can adjust either upward or downward to suit their particular levels, but they will in no way affect any other producer's effort.

An example can best demonstrate the weaknesses of the present system and how this amendment would stop the increases in dairy production.

Assume that a farmer's herd produces,

1949

order markets, 1947-64

1957.

1959. 1960

13, 898, 734

2.96

411, 403

1962.

1963. 1964.

main in effect.

Fourth, this amendment contains not a single penalty clause.

Fifth, the amendment would not affect the price of milk to consumers.

To place this amendment in perspective, consider the present situation as it exists under milk marketing orders, since the amendment has to do only with these orders.

Milk marketing orders play an important role in the dairy picture in the United States as a whole. More than 75 orders are now in operation. These orders produce almost 50 percent of the Nation's milk.

Since 1940 the number of markets covered by Federal orders has increased from 17 to 77. The amount of milk regulated under these orders has increased from less than 20 percent to almost 50 percent of all the milk marketed in the United States. Over the same period, the percentage of Federal order milk used for manufacturing purposes has increased from less than 30 percent to almost 40 percent. In some of the larger markets, the amount of milk used for manufacturing purposes exceeds the milk used for fluid purposes.

I ask unanimous consent to have printed at this point in the RECORD a

605, 276 606, 843

1 This figure includes some milk used for fluid purposes and included in a class other than class I. The amount of such milk is relatively small.

2 Estimated to be equal to the U.S. manufacturing milk price converted to 3.5-percent butterfat content. 3 Col. 1 X col. 2.

Mr. JACKSON. Mr. President, will the Senator yield?

Mr. PROXMIRE. Mr. President, I am sorry. I had told the distinguished Senator from Vermont that I would continue my presentation without yielding. I apologize to the distinguished Senator from Washington who is a cosponsor of my amendment and was a cosponsor of the amendment in 1963, when it was agreed to by the Senate.

The present blend price system increases our dairy surpluses. If we eliminated the blend pricing system, we could reduce the burden on the taxpayer, and, at the same time, give the dairy farmer an opportunity to tailor his production to what is needed.

It is fantastic that the Chicago marketing area should produce more than 11⁄2 times as much excess milk as is used for the fluid purpose for which the order is designed. In other words, for every quart that is used for fluid purposes, there is 12 quarts of excess.

At present, if farmers who are under the marketing order increase their production, the price goes down. However, under my amendment, the farmer would not have to increase production in order to keep up with other farmers. Under the blend pricing system, an individual farmer has no control over either the blend price he receives for his milk or his total income. Under the proposed amendment, any producer can control his own price and income. This is so because his allotment guarantees a high price for a specified quantity. Then, to attain his income and economic objective, he produces only the amount which would maximize his returns. Pro

order 200,000 pounds of milk in a particular year. Assume that half of this milk-as in the New York-New Jersey area-goes into fluid or Class I purposes, and half goes into excess or manufacturing purposes. Assume further, for simplicity's sake, that the price for fluid milk is $5 a hundred and the price for manufacturing milk is $3 a hundred. Assume finally, that the farmer has a fluid milk base of half of his production, or 100,000 pounds.

Under both the present administration of the law and the proposed amendment, the farmer would receive $8,000 for the milk which he marketed-that is, 200,000 pounds multiplied by $4 a hundredweight.

Under the present law, he would receive a $4 blend price for each hundredweight which he marketed. However, under the proposed amendment, he would receive $5 a hundred, or $5,000 for his first 100,000 pounds, or base, and only $3 a hundred, or $3,000, for the second 100,000 pounds that he marketed.

The incentive to reduce production, and especially the incentive not to increase production, shows up sharply when we see what happens under the present law and the proposed amendment if the farmer decides to change the amount of his production.

Under the present law, if the farmer cuts back production by 10,000 poundsor about one cow-he loses the blend price, or $400 in receipts. Under the proposed legislation, if he cuts back production to the amount of 10,000 pounds, he loses the manufacturing price of only $300. Hence, there is a significantly larger incentive under the amendment for the dairy farmer to reduce his production.

The incentive is likely to work even more sharply for the farmer contemplating an increase in production. Under the present law, if the farmer increases his production by 10,000 pounds, he receives the blend price of $4 a hundred, or $400. But under the proposed amendment, if he increased production by 10,000 pounds, he would receive only $300. He would not get $400. He would get only $300.

The reason that this proposed legislation is likely to be so decisive in discouraging additional production is that the overwhelming majority of farmers throughout the Nation cannot cover their costs at $3 a hundred, and they know it.

The result is that the vast majority of farmers who take out pencil and paper to decide whether or not to add another cow and an additional 6,000 or 8,000 pounds of annual production to their herd will find that the addition would cost them money if the additional production brought them only the manu

facturing price-in this case $3-and not the blend price-in this case $4.

Much of the evidence concerning the need for dairy legislation relates to excess production and the cost of the program to the Federal Government. Production in the past few years, as well as now, is in excess of market needs.

During 1963 the Federal Government was required to purchase 7.8 billion pounds of milk on an equivalent milkfat basis produced in excess of our needs. Last year the Department of Agriculture was required to purchase 8.5 billion pounds and through July of this year the Government purchased 6.2 billion pounds in excess of needs. The Government was required to purchase 6.2 billion pounds because of an overproduction of milk on our farms. My amendment is designed in part to help correct that overproduction, and that is one of the reasons the Department of Agriculture supports it.

Two years ago the Department of Agriculture estimated that production would be cut by about 600 million pounds and that there will be a net savings to the Government of approximately $26 million in the first year, if my proposal is enacted. That is a conservative estimate because it is based upon the assumption that it will require longer than a year for the marketing order areas to take advantage of the law and for the law to become fully effective. I stress that the first year is where there would be the least saving. As the years go on, I think the savings would distinctly increase. This is another very desirable feature of the amendment; that is, the feature of gradualism. There will be no sharp adjustment which could have a tremendous adverse economic and market impact on the entire dairy industry, to say nothing of consumer interests. It might also be well to point out here that consumer interests are fully protected under the law, and that any reductions in production would create no upward pressure on consumer prices. All we are doing here in this regard is to reduce the cost to the Government and save the taxpayer's money.

It is also true that the income of dairy producers is pitifully small. For example, the Department of Agriculture reports that the average return per hour earned by milk producers on grade B, eastern Wisconsin farms in 1964 amounted to only 36 cents per hour.

That is what these farmers earn, although they have greatly increased their efficiency and their investment. In 1964. they earned 36 cents an hour, and only 11 cents an hour in 1960. The income of these farmers is held down because of the excess production encouraged by the blend price in order areas. Anything we can do to cut down on excess milk production will be a step forward toward improving incomes of these producers.

The Agricultural Marketing Agreement Act of 1937, under which marketing orders are regulated today, is largely a restatement of the provisions relating to marketing agreements of the act of 1935.

The substantive provisions of this act as they relate to milk marketing agreeCXI-1484

ments have not been amended since this act was passed. In 1963 the Senate Agriculture Committee reported out a substantive amendment to that act substantive amendment to that act which I sponsored and which is idenwhich I sponsored and which is identical in every respect to the proposal I have called up today. It passed the Senate by a 45 to 33 margin. This was the first time that the Senate considered a substantive amendment to the milk marketing portion of the Agricultural Marketing Agreement Act of 1937. Today is the second time.

As my colleagues well know, the House of Representatives took no final action on the Proxmire dairy bill in the 88th Congress. Today we are in a situation which is exactly the reverse of that which existed in 1963-64. The House added a similar provision to the Food and Agriculture Act of 1965 yet the Senate Agriculture Committee deleted that ate Agriculture Committee deleted that provision from the bill we are considering today. That is the reason I am asking my colleagues to once again accept a measure they, in their wisdom, passed in 1963.

Here is how the amendment differs from the House dairy section-title I from the House dairy section-title I of the agriculture bill as it passed the of the agriculture bill as it passed the House.

First. With respect to the entry of new producers into the market, the House bill provides only that an increase in class I sales, or forfeited bases would be made available to new producers and hardship cases. My amendment safeguards free access to a milk marketing order by providing that producers who delivered milk, but not under the order, at the time the allotment provision beat the time the allotment provision becomes effective under an order, would receive allotments on the same basis as those who were at that time delivering those who were at that time delivering under the order.

Second. My amendment would permit cooperatives to engage in bloc voting, cooperatives to engage in bloc voting, and I think that is in accordance with a custom which the Senate has generally a custom which the Senate has generally approved.

Third. The House bill specifically authorizes marketing orders for manufactured milk. My amendment does factured milk. My amendment does not. After a thorough examination of the milk marketing provisions of the Agricultural Adjustment Act of 1937, I Agricultural Adjustment Act of 1937, I am convinced that manufacturing milk am convinced that manufacturing milk orders can be promulgated under the orders can be promulgated under the current language of the act.

Finally, my amendment provides for administrative review of allotments made to individual producers while the House bill does not. This is a technical difference which goes to the question difference which goes to the question of program flexibility. The pending of program flexibility. The pending amendment allows the administrator more leeway in applying the law.

Mr. President, I have finished my 15minute presentation.

Mr. HOLLAND. Will the Senator yield?

Mr. PROXMIRE. I shall be happy to yield with the sufferance of the Senator from Vermont, who asked for the floor first.

Mr. AIKEN. Suppose first I ask my question, and then the Senator may yield.

The PRESIDING OFFICER. The Senator from Vermont.

Mr. AIKEN. Mr. President, the Senator from Wisconsin has made a very able case for his amendment. However, there are two matters which should be made clear before we vote on it, so that, should his amendment become law, there will be no misunderstanding as to the intent and purpose.

The PRESIDING OFFICER. The Senator's additional minute has expired. Mr. AIKEN. I will yield myself 15 minutes.

I will first call attention to one of the statements the Senator made, showing the amount of milk which has been purchased by the Federal Government the first 6 months of this year and comparing it to the purchases of the entire year.

Of course, the Senator from Wisconsin understands that almost all the milk is purchased the first 6 months of the year, but the figures which he presented actually indicate that less milk will be purchased this year than last year. I believe that when it comes to some dairy products, the Government is not purchasing any at all at the present time and, during the last 6 months, will even be disposing of what it purchased the first 6 months of the year.

However, to get down to my question, as I understand, the purpose of the Senator's amendment is to raise prices to the farmer without increasing prices to the consumer.

Mr. PROXMIRE. Will the Senator yield for me to reply to that part of his question?

Mr. AIKEN. I yield.

Mr. PROXMIRE. The amendment would not raise prices to the farmer. As the Senator knows, the amendment would permit the farmer to receive the fluid price for that part of his milk which goes into fluid consumption.

Mr. AIKEN. If he took advantage of the Senator's amendment, the fluid milk producer would be voting to reduce his sales of milk in the order market, is that

correct?

Mr. PROXMIRE. He could obtain an allotment, and that allotment would be related to his previous production. If he then was, so to speak, a good citizen and reduced his production so that the Government would not have to buy so much, he would still be able to sell as much as he did before at the fluid price, and he would therefore be in a better profit and loss position, but that would not increase the fluid price to the consumer.

Mr. AIKEN. But under the Senator's amendment, he would be authorized and presumably would vote to reduce his total deliveries of class I or drinking milk to the market, is that correct?

Mr. PROXMIRE. Of course, as the Senator from Vermont well knows, everythings that he sells qualifies as class I. The sanitary requirements are the same. But he would reduce the amount of milk he sends to the market. The amount that would be reduced would be the excess milk.

Mr. AIKEN. Is there anything in the bill which would indicate that he would reduce his total production of milk?

Mr. PROXMIRE. Nothing except that the incentive would exist.

Mr. AIKEN. An incentive to do what?

Mr. PROXMIRE. An incentive to reduce his herd's production, because on excess production, he would get a reduced price. Instead of $4 a hundred pounds he would get a price of approximately $3 a hundred.

Mr. AIKEN. A producer who had a favorable base would get a larger share of the class I sales. A producer who was expanding and had a poor base would be reducing his share of class I sales. Does the Senator contend that reducing the amount of high-priced milk which he sends to market and selling more of the low-priced milk would be an incentive? It is difficult for me to understand how decreasing the amount of drinking milk and increasing the amount of manufacturing milk would result in increasing income to that farmer.

Mr. PROXMIRE. What would happen would be that the farmer would reduce the amount his herd would produce. At any rate, less milk would be sold in the market area. As it is reduced-to take the situation in Chicago-instead of producing 60 percent in excess, that excess milk would be diminished down to 50 percent, or 40 percent.

Mr. AIKEN. As I understand, the reduction is supposed to be made in the high-priced milk, that is the milk that is approved for fluid consumption. Is that correct?

Mr. PROXMIRE. The reduction would be made in the excess milk.

Mr. AIKEN. But the bill would work to reduce the farmer's total production, would it not?

Mr. PROXMIRE. Yes, indeed. The incentive would be for the farmer to reduce excess production, because he would be better off economically in doing

.so.

Mr. AIKEN. The incentive is to reduce the amount of milk suitable for fluid consumption going to market. For a producer with a poor base, this would reduce his quantity sold at $6 a hundred and increase the amount of milk sold at $2.50 a hundred. I fail to see any incentive there. It may be present, but I may not be able to see it.

The idea, as I understand, is to reduce the amount of drinking milk sent into the market, on the presumption that that might raise the farmer's income. Of course it might raise the consumer's cost. Suppose he voted to reduce the amount that was supposed to be sent into the market enough to result in a shortage. Would that market be prohibited from using second-class milk to fill up any void that might be created?

Mr. PROXMIRE. The Senator is referring to the bacteria count?

Mr. AIKEN. I do not know. That is why I am asking the question.

Mr. PROXMIRE. There is no difference. The milk is precisely the same as delivered. However, under a baseexcess plan the farmer would tend to reduce his production to the amount that would be sold in the area, and if we got down to the point where 90 percent of the milk being produced used for fluid, and only 10-percent excess, the danger point could be reached. The processors would then be free to negotiate a situation for farm allotments to

expand production. Each producer would receive a larger fluid allotment, or other farmers could come into the market.

There is plenty of flexibility here.

Mr. AIKEN. Who would make sure that the farmers would keep within their quotas? There are many farmers who would ship into the marketing order areas. Who would police it?

Mr. PROXMIRE. The allotment would be determined on the basis of history-on the basis of what production was in the past. The bill does provide for recordkeeping. If the farmer produced and sold and brought to market his allotment, then anything in addition would simply get the excess price.

There would not have to be any additional policing, or any penalty, in my judgment.

Mr. AIKEN. Who urged the Proxmire bill?

Mr. PROXMIRE. The bill is supported by the Department of Agriculture. Secretary of Agriculture Freeman testified for it.

Mr. AIKEN. Did he ask for it?

Mr. PROXMIRE. He testified for it. Mr. AIKEN. He did not ask for it? Mr. PROXMIRE. In 1961 President Kennedy asked, I repeat, asked for this program. President Johnson has asked for this as part of a larger program. He was supported by the Milk Producers Federation, the National Grange, and by a number of cooperatives.

Mr. AIKEN. I do not recall the extent of the testimony of the National Grange on this subject, but I would not be surprised. They are completely sold on this program.

Mr. PROXMIRE. The National Grange has great respect and admiration for the Senator from Vermont, but they knew he had made up his mind and there was no point in arguing with him.

Mr. AIKEN. The President did not ask for this proposed legislation, did he? ask for this proposed legislation, did he? The Department of Agriculture did not The Department of Agriculture did not ask for this proposed legislation, did it? Has the Senator from Wisconsin any evidence to show that either of them did?

Mr. PROXMIRE. The testimony of the Secretary of Agriculture indicates a desire for this proposed legislation and he approved of it.

Mr. AIKEN. May I read a paragraph from the report on the bill?

Mr. PROXMIRE. Yes, indeed. Mr. AIKEN. I shall read an excerpt from the first page of the Department of Agriculture report:

The bill also provides that producers would receive the lowest class price for milk delivered in excess of their allotments.

Then, if they cut the highest price production, where would there be an incentive; where would they gain more income; where would they make money at all?

Mr. PROXMIRE. If I may answer that question, they would make money by more economic economic operation. They would cull out the cows which were making for inefficient production and which did not produce much milk in any event.

They would have an additional incentive for culling out more of the older

cows and operating on a more efficient basis. In this way, they would be able to reduce the numbers in their herd in relation to income. Let me say that the Secretary of Agriculture, on page 177 of the hearings, says this:

We have tried, and tried hard, to develop a comprehensive dairy program. We have worked with the dairy industry from producer to retailer; we have explored programs and legislative avenues of many kinds. Unfortunately, so far there has been little As a result, no proposals have yet commanded agreement within the dairy industry. the support necessary to be enacted into law. I know that this is a problem for the committee as it is for the administration.

Nonetheless, positive steps can and should be taken to improve the economic position of the dairyman. I believe that enactment of legislation authorizing the use of base

plans in Federal milk order markets, as proposed in S. 399 by the chairman, would be a step in the right direction. In markets where producers elected to adopt a base plan, as provided for in this bill, there would be an incentive to hold down increases in milk

production. This would help reduce present surpluses to the benefit of all.

Mr. AIKEN. I do not believe the Senator from Wisconsin should use up so much of my time. Let me ask the majority leader if I may have time on the bill

Mr. MANSFIELD. Yes, indeed.

Mr. AIKEN. I should like to read what the Secretary of Agriculture said in his report.

He said:

No producers are prohibited by subparagraph (h) from marketing any quantity he desires to market.

Then in the next to the last paragraph, he says:

We believe that the proposed bill could increase incomes of dairymen slightly and reduce marketings of milk in some areas.

I agree that there are some areas where the marketing of milk has been so badly mishandled that they could not help getting more income if there were any change at all in their methods.

Mr. PROXMIRE. I agree with the Senator wholeheartedly. I would say that this is not a panacea. It will not solve all our problems. It will help to increase farm income quite modestly and will cut costs-some $26 million, which is not a sum of money to be sneezed at.

Mr. AIKEN. To continue, the Secretary of Agriculture said that if it is enacted, it will be a small step.

Mr. PROXMIRE. I agree with the Senator from Vermont on that.

Mr. AIKEN. Can the Senator from Wisconsin tell me of one single milk marketing order area in this country where farmers would be likely to vote to reduce their production and would be benefited by such an action? Can he name one?

Mr. MAGNUSON. Mr. President, will the Senator from Vermont yield?

Mr. AIKEN. In the Chicago area? Mr. PROXMIRE. I yield to the Senator from Washington.

Mr. MAGNUSON. I can name one. In the area of western Washington. All the co-ops there support the bill and wish to do exactly what the Senator from Wisconsin suggests.

Mr. MAGNUSON. In western Washington most of the dairy people are located. The State grange is highly desirous of the bill. When the Senator from Vermont suggests who wishes such a bill, let me say that the U.S. Senate wished such a bill 2 years ago—

Mr. AIKEN. I will tell the Senator who wants the bill. It is a group of misfits who are looking forward to getting Federal jobs policing the program. Those are the ones who are promoting it. They are going from State to State telling the milk producers of the advantages they would receive if they marketed less of the high-priced milk and more of the half-priced milk.

Mr. MAGNUSON. I do not believe anyone in the Washington State grange wishes that. I have no applicants at all from the Washington State grange. They would like to have a good dairy program such as the Senator from Wisconsin is advocating.

Mr. AIKEN. Would the Inland Empire, for instance, which now marketswhat? 60, 70, 80 percent-a good share of the milk as class I. Would it wish to reduce that class I milk?

Mr. MAGNUSON. One of the reasons they do say and claim that there is more stability in prices and that the farmers can plan better for his herds and how he produces milk. This was the main argument 2 or 3 years ago when we passed a bill in the Senate which would create a more stable price situation for the producer.

duce milk in the Chicago area, trying to make alibis and excuses that the laws are to blame.

Yet, Milwaukee area farmers are selling approximately 82 percent of their milk as Class I milk. I doubt if the highprice milk producers wish to reduce their production to make room for lower price milk from the Chicago area.

Mr. PROXMIRE. I am glad the Senator mentioned that. We have a strong cooperative, the Golden Guernsey Cooperative, which is able to do this with 82 to 85 percent utilization.

The The

provide for allotments under milk marketing orders, so that producers may receive a higher return on fluid milk covered by allotments and a lower return for milk produced in excess of allotments. This pricing system would discourage overproduction and surpluses caused by the so-called blend-price system.

This plan is supported by the administration, and it was passed by the House of Representatives. I think it should be adopted by the Senate.

My interest in this amendment has nothing to do with the relative merits of oleomargarine and butter. Over 90 percent of Arkansas milk production is marketed as fluid milk. Participation in the proposed pricing system must be approved by a two-thirds vote of the farmers in each milk-marketing area. Arkansas milk producers favor the class I-fluid milk-base plan system, and I

The PRESIDING OFFICER. OFFICER. time of the Senator has expired. Mr. AIKEN. Mr. President, I yield support them. myself 15 minutes more.

I would like to ask the Senator why it is, if this proposal is so popular around the Chicago area, so many of the dairymen just outside the Chicago area are men just outside the Chicago area are asking for a defeat of the amendment?

Mr. PROXMIRE. The information of the Senator from Wisconsin is that this is not so. The State of Wisconsin inis not so. The State of Wisconsin includes several marketing order areas. We also export more milk than the next We also export more milk than the next five milk producing States combined. I am a Senator from Wisconsin, who gets out to talk to the people of my State as out to talk to the people of my State as much as I can. I have been traveling around my State and talking with farmers a very great deal in recent years. They want this legislation. There are some differences and disputes, but, by and large, they favor this provision.

Mr. AIKEN. By what miracle did the Senator from Wisconsin acquire such vigorous support from the oleo producers for his amendment?

Mr. AIKEN. I have got some more questions.

Mr. MONRONEY. Mr. President, will Mr. President, will the Senator from Wisconsin yield? Mr. PROXMIRE. I yield. Mr. MONRONEY. I should like to say I should like to say that the principal markets in Oklahoma support the program.

Mr. JACKSON. Mr. President, will the Senator from Wisconsin yield?

The PRESIDING OFFICER (Mr. BURDICK in the chair). Does the Senator from Wisconsin yield to the Senator from Washington?

Mr. PROXMIRE. I yield.

Mr. JACKSON. Mr. President, I should like to corroborate what my senior colleague [Mr. MAGNUSON] has said. said. Both milksheds in the Puget Sound area and the Inland Empire have indicated through their cooperative groups that they have made, at least they support the pending legislation, and they supported it previously when it passed the Senate. The Senator from Wisconsin has indicated it is modest and is a reasonable approach, and it seems to me that it should be tried out. If it does not work, then we can try something else.

Mr. PROXMIRE. One of the biggest market areas is Chicago and Mr. McWilliams, the executive secretary of the

Mr. PROXMIRE. The Senator is referring to one of the ablest of Senators and a cosponsor of the amendment, the Senator from Arkansas [Mr. FULBRIGHT]. I am glad to have him as a cosponsor on any amendment of which I am a sponsor. The Senator from Arkansas has an important dairy industry in Arkansas. He favors this proposal.

Mr. AIKEN. Of course, for every 100 pounds of milk that can be kept off the market, oleo is helped.

The amendment of the Senator from Wisconsin, of which I am a cosponsor, is to the advantage of fluid milk producers. In my State 90 percent of the milk is sold in the form of fluid milk. They are in favor of this amendment. If the figures which the Senator from Wisconsin has given—and he has more knowledge on this subject than I haveare correct, it will be an advantage to producers of fluid milk. This is an alternative to the present system. As he has said, it is permissive. I do not think it is to the disadvantage of butter. I have nothing against butter

Mr. AIKEN. I know that.

Mr. FULBRIGHT. Oleomargarine still can be bought for less than 30 cents a pound, less than half the price of butter. As the Senator knows, the only reason why my oleomargarine bill did not pass many years earlier was that of unlimited debate in the Senate. It passed the House many times. It was in the consumers' interest that we enabled them to purchase the healthy spread known as oleomargarine.

Mr. AIKEN. I am glad the Senator from Arkansas has become reconciled to the use of some butter.

Mr. FULBRIGHT. I did not hear the Senator. What butter?

Mr. AIKEN. Some butter.

Mr. FULBRIGHT. Oh, it has its place.

Mr. AIKEN. Let me tell the Senator

Mr. FULBRIGHT. Mr. President, will from Arkansas that if the amendment the Senator yield?

Mr. AIKEN. I have not much time. I have not gotten started with my questions, but I will yield. tions, but I will yield. I know the influence of the Senator from Arkansas. He has licked us before. has licked us before. It looks as if he might have the vote against us again. He is the greatest champion of oleo in the United States, if not the whole world. Mr. FULBRIGHT. I appreciate the Senator's compliment.

There was debate on the oleomargarine bill. It was a friendly exchange. I joined in offering the pending the pending amendment because it would authorize a milk program which is good for Arkansas dairymen and good for the Nation as a whole. This amendment would authorize the Secretary of Agriculture to thorize the Secretary of Agriculture to

proposed by the Senator from Wisconsin should be adopted and the marketing order areas were to go ahead under the proposal, there would be much more butter in competition, if producers are required to cut down on the production of class I milk.

Mr. FULBRIGHT. I agree with the Senator. That which is least profitable should show a decline immediately.

Mr. PROXMIRE. Certainly as compared with the present situation.

Mr. AIKEN. Mr. President, my 15 minutes are going fast, and I have many questions to ask.

Assuming that a group of producerorganizations sells milk in two order areas; could they vote in both of them? There are many of them up and down