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Many of you will recall the frantic appeals in World War I for farmers to produce more, because armies travel on their bellies. Farmers did produce more, and they kept on producing to feed and clothe our allies, even our former enemies. But they built up surpluses over the years; prices went lower and lower year by year and American agriculture as a whole was virtually bankrupted in the early thirties. Then came the drought years, and the very surpluses which had so nearly destroyed farmers everywhere provided cheap food and fiber for a nation unemployed, in hunger and want.

The same continuing surpluses came in right handy in World War II, when we found it necessary to feed and clothe, not only ourselves and our allies, but later on our conquered enemies, and still later, people all over the world who were and still are in need and hungry-people ripe for the beguiling promises of communism.

So, gentlemen, is it fair in the light of history to criticize too severely our so-called farm surpluses? They saved Egypt in Biblical days. They saved our allies during two World Wars and have contributed greatly to recovery after peace came.

The threat of another war-a war more destructive, perhaps, than the human mind can conceive of—hangs over our heads constantly. God grant that it may

never come.

But if it should come, the very surpluses of farm commodities under such vicious attack today, will be among our greatest treasures. Tanks and guns and planes and other horrible implements of modern warfare are necessary, of course; but so is food and clothing. Our reserves of food and fiber are not a burden; in fact, they are among our greatest assurances of national security.

After this stout defense of reserve farm products in the hands of CCC, you may be surprised at the following statement:

Tung producers of the United States, in the truest sense, are not responsible for 1 pound of the some 15 million pounds of tung oil now in the hands of CCC. We have never produced in the United States enough tung oil in any year to supply United States factory requirements, never even in our very best production years.

The one reason why domestic tung oil has remained under loan more than temporarily is that imports of foreign tung oil have been permitted to flood our markets year after year.

Tung oil, like most other products of human labor, sells at a lower price on world markets than on United States markets. Many of our industrial and agricultural products are protected against excessive imports by tariff fees, import restrictions, and similar devices. Not so, in the case of tung.

And so, a peculiar but altogether distressing market situation has arisen. Tung growers of other nations of the free world have practically no home market for their product and practically their entire production must be exported. Naturally they seek the highest market available, even if the gain is no more than a fraction of a cent a pound.

In the United States we are protected by a support price which is entirely too low but which nevertheless provides an umbrella over all tung oil sold in these United States. Our domestic producers will not sell at lower than the support price. This gives the foreign producers the opportunity to undercut the prevailing United States price and thereby force the domestic production into the hands of CCC.

Red China has dominated the European market for a number of years, and the European price has been consistently lower than the United States price. During the past year, however, large quantities of tung oil from free world countries have been shipped to Europe and a price war has resulted. Tung oil is today around 8 cents per pound cheaper in Europe than in the United States. Under Presidential decree we permitted the import of some 26 million pounds during the year. This amount, much greater than needed, was imported at prices just under the prevailing market price and in several instances even slightly under the support price, so that much of our domestic production was forced under CCC loan. Thus our support price, while giving insufficient but greatly needed protection to United States growers, has served as an umbrella to protect the price of some 26 million pounds of foreign oil.

The basic cause of this situation is excessive imports of foreign tung oil. Now, the tung industry is in another position which is somewhat unique. We feel that it is to the best interest of the public, the manufacturers, and our own producers, that sufficient oil be available at all times to supply all reasonable factory demands. To this end we do not want to prohibit imports of tung oil

entirely from foreign countries. We are anxious that imports be permitted to the extent of the amount needed to so supplement our own production as to supply all reasonable domestic requirements. And we do not seek to penalize such needed imports by tariff fees.

Congress has provided broad avenues of relief to meet our situation as we have outlined it. The remedy now available to us is section 22 of the General Agricultural Adjustment Act.

However, from hard-earned experience, we have come to discover-first of all, that section 22 leaves entirely too much to the discretion of those agencies in the executive branch, to which the authority is delegated, to decide whether or not to impose the necessary import restrictions. Second, and by no means of any lesser importance, is the fact that the process provided by section 22 for obtaining relief from imports contains so much lost motion that by the time the remedy may have been applied the patient had long since expired.

In brief, what is so badly needed, gentlemen, is the provision of automatic import controls by law in place of controls according to the whims of men.

Briefly, we feel that a determination should be made annually of the amount of tung needed to fill all reasonable and legitimate requirements of consumers. In addition a reasonable carryover should be provided for in order to meet any possible unforeseen contingencies in consumers' needs. At the same time, an estimate of the total supply of tung oil that would be available from all domestic sources, both public and private, to meet the estimated demand plus carryover should be made. Any shortage in supply on this basis should be filled by imports from foreign producing countries upon a quota basis to the extent, but only to the extent of the indicated shortage.

Over and above this so-called normal plan, we believe that the President should be granted emergency power to extend a quota so established in the interest of national defense or of the general national welfare. When, however, the President might deem it necessary to use this emergency power and authorize the importation of additional amounts of tung oil in excess of the normally established quota, we feel that an amount of oil equivalent to the excess imports should immediately be purchased and removed from the market by the Secretary of Agriculture. And that the cost of such purchases should be charged to appropriations for the specific project or projects intended to be served by the President's permit instead of to CCC's account. In this way the American people as a whole would share the cost of meeting the emeregency instead of having this cost borne entirely by America's farmers. We believe that most Americans would consider this procedure as being only just and proper.


I have discussed with you some of the major problems of our tung industry, all of them concerned with price and other factors over which we growers have no control whatever. We have other problems the solution of which is within our control to a large extent; and through our three organizations, which we are financing at considerable cost and sacrifice we hope to do something about them. This statement is merely to assure you that we are not coming to you pleading for help while doing little or nothing on our own.

The solutions we propose for your consideration are neither haphazard nor hastily arrived at. Those of us who have lived with tung and fought for tung these many years have devoted many hours of thought along with deliberations and discussions, and we feel that we are competent to speak authoritatively on the issues discussed with you.

We are of course familiar in a general way with the farm problem as a whole in this country. We do not, however, feel fully qualified to discuss with you measures for the relief of other distressed commodities. We speak only for tung. It is our firm conviction that any permanent solution to the overall farm problem must be made on a commodity-by-commodity basis. Our recommendations therefore, while general in some respects, are specifically applicable to tung.

We therefore request and urge that the Congress include in any new or revised agricultural legislation the following provisions:

1. That the basic parity formula be reappraised so that the parity base and resulting parity prices shall at all times be realistic and adequate relative to the economic times.

2. That support prices and support price floors be fixed at such percentages of parity as to insure prices to farmers in keeping with the American standard

of living. We suggest for tung a minimum support price of 75 percent of parity, as proposed in H. R. 11215.

3. The year-by-year control and limitation of imports (in the case of tung oil) to that amount needed to supplement our domestic production so as to satisfy all legitimate domestic requirements, plus a reasonable carryover to care for any emergency. Such calculations and allocations should be made prior to but not too far in advance of the beginning of each marketing year.

We urge further that the meaning of the Congress be clearly and specifically set forth and that only the barest necessary minimum of discretionary authority be vested in administrative officials.



SEC. Section 22 of the Agricultural Adjustment Act, as amended, is further amended by adding the following new subsections:

"(g) In addition to the import controls provided above, the Secretary of Agriculture is authorized and directed to prescribe import quotas in the manner hereinafter provided for the purpose of preventing imports from adversely affecting the agricultural policies of Congress. It is the policy of Congress, except as otherwise expressly provided for any commodity, to maintain adequate domestic sources of supply of agricultural commodities and the products thereof and to stabilize domestic prices for such commodities and products at levels which will equalize the economic status of agricultural producers with that of other segments of the economy generally and provide fair returns for the labor and investment of such producers.

"(h) Imports of articles which interfere or tend to interfere with the objectives mentioned above by displacing or tending to displace sales or other outlets for domestically produced agricultural commodities or the products thereof or by creating a condition of uncertainty with respect to domestic supply-demand relationships, or by injecting an element of instability in long-range planning, adversely affect the agricultural policies of Congress. Import quotas shall be established by the Secretary for all articles the importation of which in the quantities reasonably to be anticipated would adversely affect the agricultural policies of Congress with respect to any agricultural commodity or the products thereof. Subject to the limitations hereinafter provided, quotas so established shall be at such levels as the Secretary determines and announces would not have such adverse effect.

"(i) Import quotas established by the Secretary under this section may not be proportionately less than 50 per centum of the total quantity of such article which was admitted for consumption during a representative period determined by the Secretary. If there were no imports of the designated article in a representative period, a zero quota may be established. Designations of articles in such quotas shall be sufficiently broad to prevent evasion and unless otherwise provided shall include any form, mixture, product, or source in which the article appears in other than inconsequential amounts. Designations may be amended by the Secretary to prevent evasion, without hearing. The Secretary shall give due notice and afford interested parties an opportunity to appear and present statements in connection with any ruling establishing, modifying in a substantial degree, or terminating any such import quota. The Secretary may prescribe rules and regulations relating to the powers conferred upon him by this section, and his decisions with respect to such import quotas shall be final.

"(j) The President may authorize imports of any article in excess of the quantities established by the Secretary as the level at which the agricultural policies of Congress would be adversely affected.

"(k) No imports of any article for which import quotas have been established by the Secretary in accordance with this section shall be admitted for consumption in excess of the import quota so established plus such additional quantities as may be authorized by the President in accordance with this section.

"(1) Whenever additional imports of any article shall be admitted for consumption in accordance with the authorization of the President as herein provided, the Secretary, through the Commodity Credit Corporation or any other agency available to him, shall remove from the domestic market a corresponding quantity of articles the sales or other outlets for which are adversely affected by such imports. Articles so removed from the domestic market shall not thereafter be disposed of by the Secretary in such a manner as to adversely affect the

agricultural policies of Congress. In removing such excess supplies from the market, the Secretary may acquire either imported articles or domestically produced articles. The cost of removing from the domestic market excess supplies equal to additional imports authorized by the President, as herein provided, shall be separately computed and shall be charged to appropriations relating to the programs served by such additional imports.

"(m) The provisions of subsections (a) through (e) shall not be applicable to the commodities or products covered by subsections (g) through (m), except that import quotas or tariff rates in effect on any such commodity or product shall continue in effect until such time as import controls covering such commodity or product become effective under subsections (g) through (m)."

(Whereupon, at 6: 10 p. m., the hearing was recessed, to reconvene at the call of the Chair.)

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