The Agricultural Situation and the Government

Proposals—III

BY CHRISTOPHER TURNOR

[This is the third and last of Mr. Tumor's articles on the Govern- ment's proposals with regard to Agriculture. We would draw attention to our contributor's observations on National Abattoirs, Ithich reinforce from a new angle what we have so long advocated.—En. Spectator.] THE objects of organization and control in markettng agricultural produce are to secure better profits to the producer, by means of enhancing prices or. by " maximizing " the nett returns through reduced costs and to stabilize prices.

It is understood abroad that the farmer, as salesman, must be a collectivist. Marketing organization is found behind tariff walls as well as in free trade countries, and is not confined to countries which export the bulk of their agricultural produce. It is unfortunate, and also a little strange perhaps, that the National Farmers' Union should oppose the first comprehensive measure to secure organiza- tion.

The case in favour of the Government's proposals is that organized agriculture could better resist its organized competitors abroad, more readily secure treaty changes, and more effectively devise some counter to " dumping." The Ministry's excellent marketing department has already cleared the ground for a full-fledged organization.

The salient argument, however, is that the producer receives only about £4 10s. for produce for which the consumer pays £10. This £5 10s. margin is out of all proportion ; if some of it can be diverted to the producer the consumer will not suffer, and will stand to gain by further reduction in the costs of processing and distribu- tion. Space - allows only one example—handling cattle for market.

We have no national system of abattoirs under which the by-products would be put to full economic use instead of being largely wasted, as at present. The saving from an up-to-date system might well be in the order of £3 per beast, made up as follows :—

(a) Direct sale-15s. per beast.

(b) Cutting out unnecessary journeys.

(c) Proper handling of by-products--15s. to 20s. per boast. (d) Handling costs. The up-to-date abattoir permits of groat saving on the labour side. (a) Through improved product.

The Marketing Bill is an Enabling Bill, to be brought into effect only at such time, and to deal with such commodities as our agriculturists consider should come within its scope. For example, the dairy farmers, if they wish, will be able to set up a milk control board.

It is clear that any movement towards organization must be backed by sufficient compulsion to prevent minorities from wrecking the movement. It is notable that under the Bill compulsion is not vested in the State, as might have been expected from a Socialist Govern- ment, but in the industry itself. The interesting question is whether our agriculturists will take advantage of their powers ; and, if they do, whether it will be on a large enough scale to ensure success. The idea of organi- zation is still new and not yet understood to be essential. It may be that Mr. Lloyd George is right in suggesting a convening " commission to set the machinery at work.- This Bill, like most of the other Government proposals, will not be fully effective unless imported produce is also controlled : it will involve trouble and expense, and fail to secure its full objective. The producer will see in it a still further differentiation against himself—more trammels on home production, and the foreigner allowed to go scot free—and he will not be disposed -to' co-operate in the scheme. Moreover, the scheme will be constantly endangered by " dumping."

In a general reorganization, bulk purchasing may well prove advisable, but not in any form by the State, which, would be disastrous. We could welcome dumped wheat from Russia, for example, in this way, by buying cheap and selling at the world price ! Under a sound control of imports, influenced by economic rather than political considerations, there need be no increase in the cost of living—which would probably occur if a general tariff were placed on foodstuffs in a crude political manner.

No matter how the country may be swinging away from Free Trade, agriculturists will never get a tariff that by itself will meet their needs. No possible tariff, for instance, would secure the British wheat-grower either the first place in the home markets or remunerative prices ; it would be an unreasonable expectation when 90 per cent. of our population are town-dwellers. Fur- thermore, a stiff all-round tariff would be too inexact a method, and militate against important sections of agriculture. Tariffs without organization and control are an invitation also to distributors to raise prices without any real justification.

Agriculture is in extremis. The Government measures can hardly bring immediate relief. I myself can see no salvation at hand except in the quota plus a guaranteed price for wheat—a form of subsidy. Subsidies may be artificial and uneconomic, but certainly less uneconomic than allowing the industry to perish. The eightpenny loaf is based upon wheat at 65s. per quarter ; to-day wheat is under 30s. I believe it would be perfectly possible to enact that the English farmer should receive, say, 50s. a quarter for his wheat and that at the same time the cost of the loaf be reduced.

Prosperous wheat conditions react favourably on the industry as a whole. There will be a danger, however, if the subsidy is too large, of bringing into wheat cultiva- tion land below the economic limit for that crop, also of encouraging the retention of obsolete marketing methods.

Over-production was unknown during the years when Free Trade was clearly the right policy. To-day there is world over-production (although no Empire over- production). Our policy actually encourages this ; other countries feel they can get something, at any rate, for any surplus they have, by dumping it here. Free Trade, from this point of view, is demoralizing inter- nationally.

The time is overdue for us to concentrate on " free production." Excessive railway rates, excessive cost of distribution, a monetary system unfavourable to industry, the dumping of commodities produced by sweated labour, above all, uncontrolled imports, are all ham- pering home production. There is a strong case for organizing the home market by itself, and our farmers are beginning, fortunately, to realize the need for this; the greater the pity, then, that the success of the whole movement should be jeopardized by overlooking the other half of the problem—the control or regulation of imported agricultural products.

[Sir William Beach Thomas's regular page—" Country Life "—is suspended during his absence abroad. It will be resumed on March 14111.—Ed. SPECTATOR.]