AGRICULTURAL RELIEF 
Mr. KiLcore. Then I think it is possible they{might not operate 
but one year. 
Mr. Fort. So that the only difference to the producer, then, 
between the two plans, in so far as the price he will receive, is that 
you think that under a second year they might not operate under 
the Crisp bill and they would under the Haugen bill. 
Mr. KILGORE. Yes, sir. They would have a guaranty in the 
equalization fee for taking care of any losses and for keeping the 
revolving fund loan intact, which they would not have in the 
loan bills. 
Mr. Fort. How much of the revolving fund do you think would 
be needed in the case of cotton even in the worst year—even in 1926, 
we will say? 
Mr. KiLcore. Well, at 12 cents a pound, which was the average 
price for cotton in 1926, a bale of cotton would have been worth $60 
and a million bales of cotton would have cost $60,000,000. 
Mr. Fort. Of which $48,000,000 could have been borrowed at 
41% per cent from banks. So that they would have used $12,000,000 
out of your revolving fund, would they not? 
Mr. KiLgore. Sixty millions would have bought a million bales of 
cotton outright, and $90,000,000 would have bought a million and a 
half bales outright, or 3,000,000 bales at 50 per cent. I think 3,000,000 
bales perhaps is the maximum that anybody thought of as likely 
to have been taken off of the market in the crop of 1926. 
Mr. Fort. Then any such quantity as that would have been neces- 
sary to purchase only in a 19,000,000-bale crop year? 
Mr. KiLGore. Such an one and under such conditions as we had 
in 1926. 
Mr. Fort. Now, then, with the Government advancing the margin 
and the balance being borrowable from the banks as the margins 
are put up, it would only take, say, 25 per cent of the total cost of 
3,000,000 bales out of the revolving fund, would it not—75 per cent 
parbvied from the banks and 25 per cent advanced from the revolving 
fund. 
Mr. KiLGork. I think you are putting your bank loans entirely too 
high, if you will pardon me. 
Mr. Fort. How high do your banks loan you now? 
Mr. KiLcore. From 60 to 65 per cent. 
Mr. Fort. Yes; but they have no such assurance as this bill offers 
with an organization in good standing to stabilize the price. 
Mr. KiLcore. They might do that, but the maximum under the 
intermediate credit acts is 75 per cent; you can not go beyond that. 
Mr. Fort. Let us take it in round figures 6624 per cent. 
Mr. KiLcore. All right. 
Mr. Fort. Three million bales on your figures would cost $180,- 
000,000, of which a third, or $60,000,000, would be borrowed from 
the revolving fund and $120,000,000 would be borrowed from the 
banks. In buying 3,000,000 bales of cotton at $60 a bale, do you 
think the corporation would have any losses? 
Mr. Kirgore. Of course, if we take the 1926 experience, which is 
behind us and which we can see and know about, no. But if we 
were attempting to stabilize the price at 16 or 17 cents, assuming 
18 cents to be the cost of production instead of 12 cents, there would 
be a much narrower margin, a greater possibility of loss. 
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