AGRICULTURAL RELIEF

189
Mr. CaveErNo. The farmer has paid his share in the surplus and
got a price above the supply-and-demand price. :

Mr. Fort. He does not get either profit or loss out of that opera-
tion until he is through.

Mr. CaverNo. No; he puts up a deposit.

Mr. Fort. But he does not get it back under this legislation.

Mr. Caverno. No; but he has received by the operation of the
board a certain advance in price, because they have pegged it high
and only part of that has been taken out of the equalization fee to
protect the transaction.

Mr. Fort. Your idea is he ought to get the surplus at no profit
and use the equalization fee to finance the transaction?

Mr. CaAvERNO. After receiving a price more than the market
justifies he gives back part of his excess, or at least deposits a part
of the excess to protect that surplus.

Mr. Fort. Under the loan bills it is proposed to lend the money and
have that accumulated surplus carried by a corporation owned by the
farmers, and in that way he actually carries it.

Mr. Caverno. Yes; but if it is owned by the farmers, the other
man on the outside has got the advantage of the high price and the
man on the inside of the corporation 1s just like the cooperative
carrying the surplus. It simply means that under the equalization
fee every man carries that part of the surplus which he himself
produces.

Mr. Fort. He does not carry it when he has sold it; that is absurd;
that is pure theory.

Mr. Caverno. He carries it when he puts up his equalization fee.

Mr. Fort. He puts up the cost for somebody else to carry it.

Mr. Caverno. I can sell my cotton on the one hand at an increased
price and buy a share in the surplus with my equalization fee on the
other.

Mr. Fort. Just a minute, Mr. Caverno. You say he is going to
carry it. Suppose this board operates through cooperatives in
cotton and advances them the money raised by the equalization fee
to buy the cotton with. Now, they bry _.?

Mr. CaveErNo. Yes.

Mr. Fort. The board advances the money and the cooperatives
buy it; who is carrying that surplus then?

Mr. Caverno. It does not make any difference.

Mr. Fort. Who is carrying it?

Mr. CaverNo. Who is carrying the surplus? Whoever puts up
the money. .

Mr. Fort. Why? If the cooperative has bought it and owns it,
with the money?

Mr. CavErNO. You mean the cooperative bought it with its own
money?

: Mr. Fort. No; borrowed money—borrowed from the equalization
ee.

Mr. Caverno. If they are not able to get enough out of the
transaction to pay the money back, the man who advances the
money is going to lose it.

_ Mr. Fort. If they are able to do it and make a little profit, who
1s paying it. Who 1s doing it then?
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