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would cost considerable capitalization, that you would have to increase the capital in order to operate in that field?
Mr. Smith. For a few months we did advance loans in the Mississippi and Arkansas and Missouri delta areas for the refinancing of secured debts only: We advanced funds for the paying of other creditors up to the value of the farm machinery. He had to release his lien and we took a first mortgage on the farm machinery. And then we would advance him funds for the production of the crop. But our loan was a fully secured loan.
Mr. GATHINGS. I am glad to get that information in the record.
Mr. POAGE. Are there any further questions? Are there any further comments? If not, we are very much obliged to you gentlemen for spending so much time with us and giving us so much help. We appreciate it. The committee will stand adjourned.
(Whereupon at 12:45 p. m., the hearing was adjourned.)
STATEMENT OF HON. WALTER ROGERS, A REPRESENTATIVE IN
CONGRESS OF THE 18TH DISTRICT OF THE STATE OF TEXAS
Mr. Rogers. I just wanted to make one observation, Mr. Chairman. I have not prepared a statement but I want to compliment all of those who introduced bills on this subject and, especially, the bill that has been introduced by Mr. Jones of Missouri.
I could outline to you numerous situations in my district and, of course, in that entire section of the country out there. But knowing the research that this committee has done on the subject, I think it would be wasting time to do it.
I do think this, I think we have a problem that is affecting our entire economy. Although as Mr. Jones pointed out this has to do with a temporary situation, it has developed from this disaster. I think we should take a long look at this type of legislation with some degree of permanency, because most of the people that have come out of my district were a trected by the drought disaster and could not borrow money and had no choice but to go into the towns and look for a job, cannot go back to the farm. You can keep those people on the farms now with this type of legislation, where they can borrow some money, in order to meet their needs. You not only can keep them on the farm but you can help to solve this recession that is taking hold in this country because the little merchants in these small towns are depending upon their collections from these farmers to stay in business themselves. In one particular instance in Hereford, Tex., they called me and told me that business had picked up about 50 percent after Mr. Benson had announced his price supports on grain sorghums, which show you how sensitive those small towns are to what the Department of Agriculture does. And I think that this sort of legislation and the permanent legislation along these lines is a good investment for this country because you can keep those people on those farmis for just about one-hundredth of what it will cost to put them back on there some day after they get into the cities and cause a lot of trouble.
I know that the Farmers Ilome Administration has tried to do an excellent job but I know that they are not going to stick their necks out and subject themselves to criticism for making bad loans. I think it is up to the Congress to move in and provide them with the authority to take care of the situation. I think it would be a great contribution to what this country needs in the farm areas.
Mr. HARRISON. You would not consider these bad loans, would you!
Mr. Rogers. The question of a bad loan, of course, is something that varies with the different districts. If a man does not have adequate security, some fellows will say that is a bad loan. He just won't make a character loan. He does not like to make that kind of loan. It creates a very bad situation where a fellow has strained his credit as far as he can go; he wants to stay on the farm but he does not have any place to go to get any money to stay in business with. If you ever let him get off he will not be able to borrow money to get back on.
Mr. HARRISON. What percentage of these people who have been struck by this disaster would you say were in a position that they could not go to the bank or the Farmers Home Administration or some other lending organization to get money to continue their operations?
Nichols, C. W., Deputy Director, Office of International Resources,
accompanied by Ť. Č. M. Robinson, Assistant Chief, Commodity
Division, Department of State..
Robinson, T. C. M., Bureau of Economics, the State Department.--
Table 2. United States rice production and exports including
cash sales and exports under Government programs expressed
in terms of milled rice.--.
Miller, Claude, president, Comet Rice Mills.-.
Table I.—Dispositions of CCC-owned rice in fiscal years 1957 and
1958, by programs, March 19, 1958_