Economic essays

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Monograph

Identifikator:: 1753623200

URN:: urn:nbn:de:zbw-retromon-136107

Document type:: Monograph

Title:: Economic essays

Place of publication:: New York

Publisher:: Macmillan

Year of publication:: 1927

Scope:: viii, 368 S.; Ill., graph. Darst.

Digitisation:: 2021

Collection:: Economics Books

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Document type:: Monograph

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Title:: The holding movement in agriculture / Jesse E. Pope

Collection:: Economics Books

246 ECONOMIC ESSAYS IN HONOR OF JOHN BATES CLARK ernment early attempted to foster the Holding Movement by the Act of September 3, 1915, which provided for special rediscount privileges with the Federal Reserve Banks for commodity paper. In 1923, through the passage of the Intermediate Credit Act, cheap and abundant credit was put at the disposal of the cooperatives, and by an act exempting them from the application of the anti-trust laws, their freedom of action was guaranteed. The failure of the cooperatives, even with the assistance of these acts, to accomplish their purpose has led to an insistent demand for direct Government action, and there are now before Congress many bills which practically commit the Government to the con- trol of the production and marketing of the staple crops through the medium of the cooperative associations.’ The chief arguments of the advocates of credit to enable farmers to hold their crops for higher prices may be briefly stated as follows: (1) The prices obtained by farmers immediately after harvest do not reflect the true relation between supply and demand because the volume of the products thrown on the market at this time creates such a glut that orderly marketing is impos- sible. The farmer is therefore at the mercy of the speculator, who takes advantage of his necessity and drives prices below their normal level. (2) Even when prices do actually reflect the rela- tion between supply and demand, they are seldom satisfactory because they do not cover the cost of production plus a fair profit. (3) The inability of the farmer to hold his crops for a sufficient time after harvest brings about lower prices, because it enables an army of useless middlemen to exact toll from both the farmer and the consumer. The first contention, if true, would be a sufficient reason for the holding of crops for higher prices, because, other things being equal, unduly low prices at harvest time would be followed by unduly higher prices later in the year, and it would be a com- paratively simple matter for the farmer to warehouse his non- perishable products and wait for these higher prices. Such a procedure would be a good thing for the farmer and a good thing for the consumer, because it would prevent the abnormally low after harvest prices and the waste which comes with over- 1 One of the more radical of these measures—the McNary-Haugen Bill passed both Houses of Congress but was vetoed by the President on February 25, 1927.

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