From the table you will observe that considering farm operators under 25 years of age, only 12.7 percent are owners while 86.5 percent are tenants. By 35 to 44 years of age, more than half are owners and less than half are tenants. When we come to the farm operators 65 years old or over, it is significant that 83.2 percent are owners and only 16.4 are tenants, the remaining 0.4 percent being hired managers. The farm credit system built up in this country has weathered many a serious storm-wars, disasters of weather, price inflation, land boom, world-wide and local depression and every manner of change in political complexion of the National Government. The farm organizations of the United States and the millions of farmers united demand the preservation of this system, absolutely free from politics and absolutely free from Government effort to become the lending agency. Farmers buy in cooperation and farmers have proven that they can and are building a sound rural credit structure. We must insist that they be given the opportunity to continue this marvelous development. Literally millions of farm boys and girls are being trained in the cooperative way in the 4-H Clubs and other junior movements. They are being trained in better farming and better business. They will be the owners of farms in the future. They will not forget if they are deprived of the greatest opportunity to become successful in their chosen calling.

To that end we insist that S. 3509 should be amended; and I want to specifically give, in brief tabloid form, the reasons why the Grange asks that it be amended.

As I said at the beginning, I hestitate to differ with some of you Senators who have given so much of your time and your effort to lower interest rates for which we fought. We are not opposing in any way the interest phases of the legislation, but we are opposing most vigorously the steps that we think are destructive. And in that connection I would like to read from my testimony before the House Committee on Agriculture [reading]:

1. We oppose this bill because it will increase the danger of centralization of authority and bureaucratic control.

2. We oppose this bill because it will destroy local interest and local participation in farm-loan affairs.

Senator HUGHES. I am interested in your getting down to concrete statements as to what parts of the bill you are opposed to and how you would change it. I think, so far as I am concerned, I have had enough of the theory, and I want to know what particular things you want changed. I have heard the theory before; I have heard it several times; I have heard you before, but I would like you to point out in the

bill the things that you think are wrong and state how they should be changed. We will never get through with these hearings if we keep traveling over the theoretical end of the subject.

Mr..TABER. I was trying to give a little historic background.

Senator HUGHES. I do not know how the other members of the committee feel about it, but I have had a little bit too much of the historic background; I have heard it over and over again. I would like to get down to "brass tacks" and have you talk about this bill.

Mr. TABER. I will do it very quickly, Senator [reading further]:

3. We oppose this bill because it will entirely remove the cooperative features of the act, which have been its greatest strength.

4. We oppose this bill because, by one legislative step, it destroys 23 years of work and an investment of $130,000,000 of farmers in their own system.

5. We oppose it because it creates the possibility of a change of policy with each incoming administration and each new Secretary of Agriculture.

6. We oppose it because it makes it easy to confuse sound credit with relief and social problems.

7. We oppose it because it will prevent a continuity of policy, making it difficult to secure capable operating personnel and good farm loans.

8. We oppose this bill because it destroys the farmer's right to his own credit system, the same as industry and commerce now enjoy.

9. We oppose it because it violates that sound principle of democratic control advocated by every true lover of liberty since the days of Thomas Jefferson.

10. We oppose it because these changes will bring grave apprehension and concern not only to organized agriculture, but to farm and home owners everywhere.

I think we might say, Senator, that the heart of our objection to the bill can be found in the general centralization of authority.

First, I want to say that I was startled, coming over on the train the other day, to read through the bill and find that in 26 places it is stated that "The Governor shall have power," or "The Governor shall have authority," or "The Governor shall decide," or "The Governor shall determine." It seemed to me that that was continually occurring on every page of the bill-"The Governor is authorized," and so forth.

Senator MILLER. May I interrupt you there just a moment, Mr. Taber?

Mr. TABER. Certainly, Senator.

Senator MILLER. I think everybody is agreed that there may be room for some legislation at this time. In this committee we have heard, and will continue to hear, general statements against concentration of authority; and I do not think there is any dispute about that. I do not think that any Senator or any Member of Congress wants to concentrate authority here any more than is absolutely necessary. The matter referred to by Senator Hughes is a matter of a good deal of importance to this committee. While we have two bills before the committee, the hearing is being held on Senate bill 3509; but there is likewise pending here the Gillette bill which has for its purpose only one objective. I think the committee would be interested, and I think it would be helpful to the committee in the consideration of the two bills, particularly the bill now under consideration, in having your organization and you, as a representative of the organization, to submit-if you are not prepared to do so this morning, to be incorporated in the record immediately following your testimony-your objections and your suggestions with reference to the provisions of this bill. First, your objections to the provisions of it, pointing out the specific provisions to which you object, and then

such constructive suggestions as you might have, in order that the committee may try, if any action is taken, to report a bill that represents the best thought of those who generalize in their testimony and of those who are for the bill wholeheartedly. I have always found that no one man possesses all the knowledge about any one thing. Legislation is a process of compromise and cooperation and synchronization and all the other processes. I think that is what the committee would be interested in.

Mr. TABER. I shall be delighted, Senator, to do that. I was going to start through the bill and point out by sections what I think should be changed. Maybe your suggestion would be better.

Senator MILLER. I do not desire to interfere with your train of thought, but I think that would be helpful to the committee.

Senator HUGHES. That is my idea, also. We have two bills. I think you testified on the Gillette bill; did you not?

Mr. TABER. I testified very strongly in favor of the Gillette bill, because the Grange has been in favor of that type of approach for a full third of a century. We were for it before the bill appeared. I shall be very glad to point out

Senator MILLER (interposing). You may proceed, and I would like you to separate your statement, because we want something specific. Mr. TABER. If I may have that privilege I will file with the committee on Monday morning a brief, first pointing out the objections of the Grange-not personal objections, but specific objections to sections and language-and then our suggestions as to how we think you can combine the two bills.

Senator MILLER. That would probably be helpful. In that statement, leave out generalizations.

Mr. TABER. I have gotten them all out of my system and into the record, Senator.

Senator MILLER. And also the historic background, because, as Senator Hughes says, we know pretty well about those things. Of course it is helpful to have the historic background, but that has already been presented; and I am just making that suggestion in the interest of economy of time and probable orderly consideration.

Mr. TABER. I shall be entirely willing, Senator, to do that. I want to make only one further observation.

Senator MILLER. Do not let me stop you now.

Mr. TABER. Interest rates, no matter how low, will not correct the disparities that are so overwhelming in agriculture. I have before me a series of tables that I shall not bother to put into the record, but even as of the first of the month agriculture is 20 percent handicapped. The average of the past 2 years is 78. You cannot possibly, if you give the farmer his money for nothing and pay him a bonus instead of interest, make up for that handicap. We are $3,000,000,000 short in income; and the real problem is farm income

I do want to furnish for the record a statement of interest charges. and a few matters of that nature if I may put them into the record. I shall not take the time of the committee, if there is no desire for future questions. I will try to be as brief as possible, and would like to have those matters follow immediately my testimony, so the record will show what the Grange proposes in the way of amendments to the pending bill, our objections and suggestions. If I may have that privilege I would be very glad to yield the floor to other witnesses.

Senator MILLER. We statement in that way. Senators would, also.

would like to have you supplement your At least, I would, and I am sure the other

Mr. TABER. I want to make it very clear that, as I said in the beginning the Grange has no criticism at all of the effort toward lower interest rates. We want better lending conditions, and we are especially concerned about the problems of interest and taxes and transportation.

I will be very glad to put a brief in the record, and will file that with someone here on Monday morning.

Senator MILLER. I just asked Mr. Taber, Senator Bankhead, who gave us a historical background-and he has said that he has relieved himself of that now and transferred it to the record-to take this bill and give us a brief statement of his objections to the language, and his suggestions for improvement.

Senator BANKHEAD. That is a good idea.

Senator MILLER. He will do that.

Senator BANKHEAD. That will be constructive and helpful.

Senator MILLER. And it will follow immediately after his testimony.
Mr. TABER. I appreciate that very much, Senator.
Senator MILLER. We are very much obliged to you.

Senator FRAZIER. Mr. Taber, you made a remark about revolutionary changes, and I presume you meant in this bill?

Mr. TABER. That is right.

Senator FRAZIER. Do you consider this a revolutionary change over the present system?

Mr. TABER. Yes.

Senator FRAZIER. And you also spoke of not being able to share profits without sharing losses in cooperatives. Do you figure that the cooperative features of the farm land banks are satisfactory to the farmers? That is, the present system?

Mr. TABER. I think it is, or can be made satisfactory to the average farmer; yes. Great improvements have been made in bringing the cooperative features and the cooperative control into effect. There has been substantial improvement, you will find, if you will check the figures as to the farm loan associations and their banks.

I think, when I was before this committee a month ago, I emphasized the condition of farm-loan associations that I had visited and the fine businesslike manner in which they conducted their affairs. They are keeping down delinquency; they are interested in stabilizing farm prices; they are interested in seeing that the farm industries get through, and the fact that they keep their capital stock intact and keep the association in marvelous shape. I do not want to go into details about that, because the information is already in the record.

Senator FRAZIER. Governor Black, in his statement before this committee the other day, stated, as I remember, that approximately 60 percent of the farm-credit associations were so badly behind and encumbered that they could not make loans as they were supposed to or take care of the loans; in other words, that they were insolvent. Of course the 5-percent stock is a cooperative feature of the land-bank system, as I see it; is not that right?

Mr. TABER. That is true. There is no denying the fact that it either has to be cooperative or it has to be Government-operated. We have the choice of two systems. No system will be perfect.

But over the long swing of the years it will be infinitely better for us to keep the cooperative features and the cooperative control and the continuing authority of groups, than under any other system.

Senator FRAZIER. I have had a good many complaints from borrowers in the land banks and members of the association that they did not have much to say even about their own association, that it was all run from the land bank in their district, and that the board of directors were chosen by the land-bank officials, and all that kind of thing.

Mr. TABER. There might be places where that is true, we all must admit, where local people do not exercise their authority; but, in the main, the farm-loan associations that I have visited and am familiar with are functioning with a larger attendance of borrowers present than you will find at a stockholders' meeting in a commercial bank. I think that the work in the last 4 or 5 years has been most outstanding in strengthening the cooperative features of these loan associations. I think that is the heart of the program, and I think there must be a way found to preserve the heart if it is to continue to function.

Senator FRAZIER. Another complaint is made that the spread between the cost of the sale of the bonds and getting the money to make the loans, and the rate of interest, is too wide, and they have set up quite a surplus of profits in the land bank. These associations have complained to me that they were not getting any share of that

Mr. TABER. Both of those claims could not be correct, because the local association could not be broke, on the one hand, and there be a profit in the association

Senator FRAZIER (interposing). Not a profit to the local association, but a profit to the land bank.

Mr. TABER. The local association owns the land bank.

Senator FRAZIER. I cannot see it that way.

Senator BANKHEAD. What interest has the Government got in it? Mr. TABER. When the Government gets its money back.

Senator BANKHEAD. What present interest does it have? Does it own the majority of the stock?

Mr. TABER. Yes.

Senator BANKHEAD. It looks like the Government owns it if it has the controlling interest in the stock.

Mr. TABER. It has at present control of the stockholder interest, as they do in some commercial banks where they have class A stock.

Senator BANKHEAD. I am just getting at the facts. You said the farmers owned it, and I thought the Government owned it, and I guess it does, under your statement, that the Government owns a majority of the stock.

Senator FRAZIER. I cannot agree with Mr. Taber that the farmers own the land banks, by any means. Personally, I would like to make

the land bank a farmers' bank.

Mr. TABER. That is what we all want to do, Senator, and any suggestions we have will be with that point in mind.

Senator FRAZIER. I hope you will touch on that in your recommendations. I would like to make it a regular farmers' bank, the same as the Federal Reserve banks are bankers' banks, and give them an opportunity to get a really low rate of interest. But apparently