As to the monopoly; I have been listening here

Senator WALSH of Montana. We have not got anywhere on the reasonableness.

Mr. CAMPBELL. No. Now, you have been talking about the monopoly. You have been inquiring of the witnesses what they consider a monopoly.

Take Chicago, that you have been speaking of. It takes 300,000 cows to supply the city of Chicago with milk; and within 50 miles of Chicago there are 6,000,000 cows. Yet you say there is a monopoly. There are plenty of cows and there is plenty of milk near the city, there is plenty outside, if they will just go and get it and bring it in; and that combination exists in every city of the country. I am talking about the milk.

Senator WALSH of Montana. Of course, if you are right that they can not organize a monopoly, then you ought never to object if there is a provision put in that they never shall.

Mr. MARSH. No; it is the construction we are after.

Senator WALSH of Montana. The gentleman says it can not be done. Then how on earth can anybody be in danger of prosecution for a crime that can not be accomplished?

Mr. CAMPBELL. How can there be any danger from this act? How can there be the slightest danger from it?

Mr. LINDSAY. May I ask you a question, in view of the statement just made by you? It struck me as being a very important question. Senator WALSH of Montana. Yes.

Mr. LINDSAY. As I understood you, your present views are along this line, that if the Clayton Act is amended so as to exempt farmers organizations as labor organizations are now exempted, you think it would serve every useful purpose. In other words, if there were added to the Clayton Act a proviso in the nature of section 1 of this proposed bill, with the added proviso, as you look at it, that “nothing herein contained shall be construed to permit the organization of or the attempt to organize a monopoly," you think that would be a solution of the problem?

Senator WALSH of Montana. Yes.

Mr. LINDSAY. Now, of course, there is, and I think you concede that also, a certain obscurity about the meaning of the word "monopoly" and it is clear, I think, to every lawyer that the Congress has only jurisdiction of such matters because of the interstate commerce clause of the Constitution. That is true, is it not?

Senator WALSH of Montana. Yes.

Mr. LINDSAY. Then, if your view shall prevail, instead of putting that last proviso in the language which has been suggested so often here, do you not think it would be better to have it in this language?

Provided, That nothing herein contained shall be construed to permit the organization of, or the attempt to organize, a monopoly of any commodity in interstate com

merce.

Senator WALSH of Montana. That is implied.

Mr. LINDSAY. Yes; but implications are so dangerous.

Senator WALSH of Montana. That is implied, because our act can

not possibly affect any commerce except interstate commerce. Mr. LINDSAY. If that view of yours should prevail, why not have the act state just exactly what it means?

Senator WALSH of Montana. There would not be the least objection to that on my part, but it is perfectly useless.

Mr. LINDSAY. I want to state, on my part, that I am perfectly satisfied with the view.

Mr. MARSH. May I make one further statement, Senator, and then I will not detain you longer?

Senator WALSH of Montana. Yes.

Mr. MARSH. It seems to me that there is no objection to making an experiment for two or three years. If you want to look at it from a political viewpoint, there are two and a half times as many votes off of the farms as there are on the farms. If the farmers do something that is detrimental under this law, or attempt to do anything that is seriously detrimental under this law, to the general public welfare, it will be easy to change it. But the farmers do need some encouragement to-day because of their desperate situation; and, in addition to the help which this safeguarding of their rights and recognition of this principle would give, by Federal legislation, I think it would be a very great advantage to have this principle established as a basis and precedent for State legislation. I understand the Federal Government can not legislate for the States in such a matter.

Senator WALSH of Montana. Only in interstate commerce. It is from that viewpoint I am simply endeavoring to so frame the law that the whole cooperative plan shall not be brought into public odium and obloquy by a statute which shall permit the organization of oppressive monopolies.

Mr. MARSH. I agree with you entirely.

Senator WALSH of Montana. What I think about it is that if we should do so, and set up a law that would permit the organization of these milk monopolies and other monopolies of like character, it would be used by the antagonists of your cooperative movement to utterly ruin and destroy it. There is not a friend of the cooperative idea more ardent in his convictions than I, and I know what the effect of this would be. I know that your whole movement would be brought into disrepute and public odium.

Mr. MARSH. You have added a word there in your last statement. You said "oppressive monopolies." That puts a new light on it for

me.

Senator WALSH of Montana. Well, of course

Mr. MARSH. That is a new thing.

Senator WALSH of Montana. But if you permit the organization of monopolies, you permit the organization of beneficent as well as oppressive monopolies. You permit them all to organize. This does not mean you will be permitted to organize beneficent monopolies, and you will not be permitted to organize oppressive monopolies. It will permit you to organize any kind of monopoly.

Mr. MARSH. Yes; it permits you to organize associations of producers which may or may not develop into monopolies.

Senator WALSH of Montana. Yes.

Mr. MARSH. But whether small or large the monopoly, whether beneficent or oppressive, it is subject to frequent, almost current, supervision.

Senator WALSH of Montana. That is the point, that if that has the construction you say it has, there is no supervision at all, or correction. As to that power to determine what is an unreasonable price,

as I have heretofore indicated, the experience of the Interstate Commerce Commission has shown that it means nothing. On the other hand, if it gives the power to fix a reasonable price, then you have entered into the field of price fixing.

Mr. MARSH. Then you have entered into price fixing; yes.
Senator WALSH of Montana. Yes.

Mr. CAMPBELL. May I have one more word? There are two things that would bar absolutely any monopoly existing for any time at all. In the first place, the hearing that we have granted. We must assume that the Secretary of Agriculture is not going to overlook the rights of the people. That is one thing. In the second place, Congress is in session constantly, and can act much more quickly than any court; even though men are arrested and put in prison before a trial can be had, and so forth. That is here.

We have both of those remedies, and the people's rights are not going to be lost if, perchance, there should be an opportunity here for the farmers to proceed a little without this menace of the great middle interests of this country that absolutely own and control

us now.

(At 1 o'clock p. m. the subcommittee adjourned until tomorrow, Saturday, June 11, 1921, at 10.30 o'clock a. m.)

AUTHORIZING ASSOCIATION OF PRODUCERS OF AGRICUL

TURAL PRODUCTS.

SATURDAY, JUNE 11, 1921.

UNITED STATES SENATE,

SUBCOMMITTEE OF THE COMMITTEE ON THE JUDICIARY,

Washington, D. C. The subcommittee met, pursuant to adjournment, at 10.30 o'clock a. m., Senator William P. Dillingham presiding.

Present, Senators Dillingham (chairman) and Walsh of Montana. Senator DILLINGHAM. Will you proceed, Mr. Holman ?

STATEMENT OF MR. CHARLES W. HOLMAN, SECRETARY, NATIONAL MILK PRODUCERS FEDERATION, 1731 I STREET NW., WASHINGTON, D. C.

Mr. HOLMAN. Mr. Chairman, and Senator Walsh: Before opening my statement and it will be very brief-I would like the privilege, at Mr. Campbell's request, of filing a supplementary statement by him in connection with the question Senator Walsh asked yesterday. Senator DILLINGHAM. It will be received.

(The statement referred to will be found printed following_the statement of Mr. Campbell in the proceedings of yesterday, June 10, 1921.)

Mr. HOLMAN. It is my purpose this morning to undertake to show, at least from the viewpoint of those who are active in forwarding the world-wide cooperative movement, that the cooperative association, per se, is semipublic in its character.

Before going into that I would like to premise my statement by referring to the testimony which has been introduced here in connection with the present unrest among agricultural producers. It would be trite to elaborate upon that. The immediate causes, of course, have to do with the price depression, the credit stringency, and a present feeling of impotence on the part of the producers, due to a lack of certain mechanical instruments, such as storage, and credits, and to a lack of certain legal instruments, such as necessary laws of a permissive character, in connection with the cooperative movement.

There is, however, Mr. Chairman, a more fundamental or basic cause for the present condition, and I would refer briefly to the land question as we have stated it to be from the farmers' viewpoint. During the last decade the tenant farmers have increased slowly but steadily, following a trend of some 40 years.

The census of 1920 showed 38.1 per cent of all the farms in the country were operated by tenant farmers. This was an increase from 37.1 per cent 10 years ago, and 35.3 per cent in 1900. Last

year's count showed 6,449,242 farms in the Nation. Of these, owners operated 3,924,851 and managers 68,512. Tenants operated 2,455,879.

In the decade the number of farms increased 98,496 or 1.5 per cent over 1910. The number of tenant farmers increased 101,203, or 4.1 per cent over the number 10 years ago.

The percentage of farms operated by owners and managers together decreased steadily from 64.7 per cent in 1900 to 62.9 per cent in 1910 and 61.9 per cent in 1920.

Twenty States, Mr. Chairman, showed a descrease of the actual number of tenants in the last decade, but with the exception of Virginia, Nevada, and Oklahoma, they also showed a decrease in the number of farms for the same period.

Among the high States, so far as tenancy is concerned and I wish to emphasize this-is Texas, where there are 232,308 tenant farmers, and where tenancy in 1920, for the State as a whole, was 53.2 per cent of the total number of farmers.

I might say that in 1915 when I was investigating this question for one of the congressional commissions-the United States Commission on Industrial Relations-looking primarily, so far as my division was concerned, into rural unrest, we mapped out the area of tenant farming in the southwest, and found that even in that year there were whole blocks of counties where tenancy would reach as high as 75 per cent; and those were in the rich black lands, where a very small percentage of farmers are Negroes.

The effect of this somewhat decadent condition is that in the tenant areas, farm population moves from year to year. I draw your attention to that not from its sociological aspect, but purely with regard to its economic effect. A population where 50 per cent of the people move either out of the county or to a distant part of the county during the Christmas time, means that it is highly difficult to form and keep in operation a permanent cooperative organization, or an organization to market products.

Another phase of this is the anachronistic method of marketing farm products in this country.

Senator DILLINGHAM. Incidentally, can you tell us why that preponderance of tenants exists in the particular region in Texas you speak of, the black soil region?

Mr. HOLMAN. I think I can, Senator, but it would involve a very long discussion. I could give you one or two points.

Senator DILLINGHAM. No matter. You need not give it.

Mr. HOLMAN. It required about 140 pages of report to cover that question.

The farmers of the country consider, and I believe their experience justifies them in their belief, that the present system of distributing raw commodities has broken down. The arteries of trade are choked so far as the efficient distribution of the products is concerned.

That is very easily illustrated by the attitude of the average commission man in handling a product for a farmer on a commission. The primary object of a commission man is to care for his own trade. The primary object of the farmer is to move as much of his product into consumption as is possible.

When the commission man, or the wholesaler or retailer, as a rule, has cared for his particular trade, his interest in increasing the