AGRICULTURAL RELIEF

187

Mr. CavernNo. If you will give me a chance, I will tell you.

Mr. KincHELOE. I have spent all the time I want to on this.

Mr. Caverno. Mr. Kincheloe, will you listen to this explanation?

Mr. KincHELOE. No, I am through. I tried to get you to tell
me something awhile ago, but I did not get any information. So I
do not think we ought to take any more time of the committee.

Mr. CaviErno. All right, gentlemen. Shall I quit now?

The CHAIRMAN. You may proceed. There have been so many
questions. I understood you also wanted to discuss the wheat plan.

Mr. Caverno. I wanted to discuss the very thing Mr. Kincheloe
has been stopping me on.

Mr. KiNncHELOE. I am not going to stop you any more. You go
ahead.

Mr. Caverno. I made this note the other day, that the equaliza-
tion fee is not a tax; it is not a fee; it is simply a figure. Let us see
what happens in actual trade. The price of wheat as it flows off
the farm—if you will omit freight, and I am doing this {or simn-
plicity—I figure the Liverpool price at a dollar, and I fizure thie tariff
at 42 cents. You have got to finance out of 800,000,006 bushels
the loss on marketing the 200,000,000 bushels; and everybody has
figured under those circumstances that 15 cents would do it, on a
bushel. That would mean that the wheat would flow ofl the farms
at $1.27 basis. It would come along from the farmer, and there
would be a step-up transformer that would step up three-fourths
of the crop to the American level of $1.42 cents per bushel. Two
hundred million bushels of that has got to be stepped down to the
Liverpool price. The farmer has nothing to do with the equaliza-
tion fee. That is a paper transaction between the exporters and
the people under the board who would accumulate this wheat—
maybe export it themselves. The value on the market at the farm-
er’s price under those circumstances would be $1.27. The people
would consume in this country on the basis of $1.42 per bushel,
and the whole crop would finance the raising to the $1.42 basis by
the equalization fee which was paid to the exporter.

Mr. AsweLL. Who would actually pay it?

Mr. Caverno. It would be paid under the direction of the board,
the man who exports the wheat.

Mr. AsweLL. Would not the producer actually pay it? Would it
not be deducted from his price?

Mr. Caverno. No.

Mr. AsweLL. Where would it come from?

Mr. Caverno. Just suppose you take a farmer and give him a
stick and cut 200 notches in it, and let him mark off the Liverpool
price of a dollar, and mark off the tariff of 42 cents, and the Tariff
Commission says that is the price he ought to get; under this opera-
tion he could only get $1.27. Do you think he is going to look at that
15 cents in the equalization fee instead of the 27 cents in his pocket?

Mr. AsweLL. Does he not actually pay it?

Mr. CavErNo. No; he gets 26 cents more.

Mr. AswerL. In the many years that I have been on this committee
listening to this line of testimony you are the first witness who has
dared to say that, and I think you are entirely wrong.

Mr. Caverno.- He gets 15 cents less than the price to the American
consuiner.