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that there were no prices. They did not know what they were going to sell the products for at the La Guardia Market until these junk dealers set the market. I will not call them by name, because I do not know any name that fits them.
This bill will not change that one whit. If these fellows are still going to manipulate the market down on the pier they could do that. without a single crate of celery or tomatoes or grapes being there. It was a question, they told us at La Guardia Market, of manipulating the prices, and the only fellows who knew how to manipulate them were down on Washington Street.
Mr. CROW. That is partly right.
Mr. HILL. Mostly right, you should say.
Mr. CROW. A fair portion of the supplies in the Bronx market are hauled up there from the Washington Street market and do not go directly to the Bronx market, so that the Bronx market, to a certain. degree, is a secondary market depending on the Washington Street market for varying proportions of its supplies.
The prices in this secondary market, then, reflect the prices they had to pay for the products of the Washington Street market.
Mr. HILL. Let me ask you another question. Have you ever given any thought to making the licenses high enough so that these fruit and vegetable dealers would have to put up a bond to operate, so that you would know that you are dealing with a first-class firm? Have you ever thought about that?
Mr. CROW. As a matter of fact, a wholesale fresh fruit and vegetable dealer in order to operate must operate under Federal license, and they must keep a correct accounting of their operations and have their books subject to inspection, to see that they give an honest accounting for their transactions. Then when a complaint is made that they are not dealing fairly an investigation is made and they must pay anything that they owe to these people, and failure to do so results in the canceling of their licenses.
Mr. HILL. Who cancels their licenses?
Mr. CROW. The Department of Agriculture through the administration of the Perishable Agricultural Commodities Act.
Mr. HILL. How many do you cancel a year?
Mr. CROW. I could not answer that.
Mr. HILL. How many did you cancel in the fiscal year 1950?
Mr. CROW. I do not administer that act. I do not know.
Mr. HILL. Could you put that in the record and tell us how many you canceled in the fiscal year 1950?
Mr. CROW. Yes, I could find out.
Mr. HILL. You should cancel a good many more, would be my
(The information is as follows:)
Canceled for cause.
Terminated because operator went out of business
Mr. CROW. In addition to the Perishable Agricultural Commodities Act, a number of States require dealers to be bonded. The CHAIRMAN. Mr. Hope?
Mr. HOPE. Mr. Crow, there is no one who knows more about this situation than you do, and you have certainly given the committee a very excellent picture of it.
You have not said anything about this particular bill. I would like to ask you whether the Department of Agriculture is supporting this legislation at this time.
The CHAIRMAN. Mr. Hope, if you will yield, will you please permit me to answer that question. I have requested a report from the Department, but the report has not yet come up. I do not think Mr. Crow is authorized to speak for the Department. In fact, I know he is not, because I talked to him before he took the stand. He is not authorized to speak for the Secretary of Agriculture.
However, Mr. Crow has worked with us in the preparation of this bill, and he has worked with the committee in the conduct of its investigation and hearing.
Mr. CROW. Yes. I traveled with the committee to make these investigations, and in the course of the report that the committee has prepared I have given technical advice.
Mr. HOPE. You are not speaking, so far as this bill is concerned, for the Department of Agriculture, or expressing its opinion on this legislation?
Mr. CROW. That is correct.
Mr. GRANT. Mr. Chairman?
Mr. GRANT. Mr. Crow, you have spoken particularly of the New York Washington Street market. Would you point to one market, or I might say several markets, if you so desire, in the Nation where costs are being kept at a minimum? That is, the handling charges and what might be classed as an A-1 market terminal?
Mr. CROW. Yes; I will be glad to.
I think I should preface that by saying, though, that there are very few markets that have been so well built that the people operating there and others cannot suggest something about them that could be improved upon. However, it is fairly easy to find some markets that are in the category of being pretty good markets.
They have a good market in Denver, Colo., where they have properly designed wholesale stores, direct rail connections with their buildings so they can unload with a minimum cost, the necessary refrigeration rooms in the buildings, and modern materials-handling equipment in the buildings. They have a satisfactory farmers' section for the market, wide streets, parking areas and room to expand. That would be one of the better markets of the country.
In Cleveland they have one of the better markets of the country. The chief objection to it is that while they brought the railroad tracks into the market area and were building the entire market area at one time they did not bring those rail connections up to the buildings themselves, so the supplies still must be trucked that last hundred yards. Except for that deficiency the Cleveland market would be one of the best in the country.
In Buffalo they have one of the best markets in the country. There they have the same deficiency, however, as in Cleveland of not bringing the railroad tracks up to wholesale houses. Other buildings were built after the first four buildings in Buffalo and to them they provided direct rail connections. They have a good farmers' section. A retail grocer can go to that Buffalo market and get anything that he needs for his grocery store. He can get fresh fruits, vegetables, poultry, eggs, butter, cheese, dry groceries, and so forth. Several
wholesale grocery firms are located there, and some chain-store warehouses. These are three of the better markets of the country. There are some in the smaller cities, too.
Mr. HILL. Will you yield?
Mr. GRANT. Yes.
Mr. HILL. I did not want anyone to misunderstand my questioning I think a terrible situation has grown up in this country. The grower may be to blame.
Twenty years ago no one had any idea that the trucks were going to deliver so much of this material. New York, with its tight space, has quite a problem. Those big trucks should not be permitted at all on the street. That is what amazed me. In the West we would not stand for it. Those trucks are almost as large as many large freight cars. You said there was room for three, but I saw street after street where one of them blocked the street. When he backed his truck up to a warehouse where he wished to load or unload. You could hardly get by on the side.
I think we should keep in mind, in working out a bill like this, that you have to consider that our whole method of transportation has been changed, and you have to consider the amount of tonnage of fresh fruits and vetgetables which is hauled by truck. Any market which is not properly arranged for the loading and unloading of trucks is operating at a disadvantage.
The New York market amazed me. A man with a small truck or a pick-up had no chance in the world of getting around, and there are hundreds and hundreds of little grocers and little markets which must buy fruits and vetgetables daily. In this New York market it is impossible for them to even send their men down there to purchase. The CHAIRMAN. Mr. Grant?
Mr. GRANT. I just want to ask this further question.
Mr. Crow, to get back to the situation on the Washington Street market in New York, the crowded conditions there prohibit to a certain extent any labor-saving devices, do they not?
Mr. CROW. That is correct. There just is not room to use them,
and the buildings are not properly designed for them.
Mr. GRANT. It seems that I recall that you and myself, or some of us, made a check there for several hours to see how many pieces of labor-saving equipment we could find. Do you recall that?
Mr. CROW. Yes; I do. After walking all up and down the street we found one conveyor about 12 feet long.
Mr. GRANT. Which was not operating.
Mr. CROW. That is right; it was not operating.
Mr. GRANGER. Mr. Chairman?
The CHAIRMAN. Mr. Granger.
Mr. GRANGER. Mr. Crow, who would you say would be the chief beneficiary under this legislation, the consumer, the middleman, or the farmer?
Mr. CROW. I am afraid I am incapable of saying which one would be the chief beneficiary.
Mr. GRANGER. This is going to be charged up as a farm bill, in aid to farmers, I suspect, coming from this committee. Who is going to benefit most under this legislation?
Mr. CROW. My belief is that the benefits would go to consumers and farmers, and that it would probably work out about this way,
DEVELOPMENT OF TERMINAL MARKETING FACILITIES
though this is merely an opinion which I cannot prove. I think that the consumers are likely to get better products, more attractive products in better condition at a more reasonable price, and when they can do that they will buy more of these products which our dietitians say they need to consume in larger quantities, and that they want more of. That will affect the farmer by providing a larger outlet for products, so that the farmer would probably wind up not with very much higher prices than he is getting now but with a higher income by reason of selling a larger quantity.
I think that there will be some benefit to the wholesalers operating in the markets because the business is gradually going away from those areas and more efficiency or lower operating costs will help keep them in business. Retailers, especially independent operators, will materially benefit.
The CHAIRMAN. Will the gentleman yield there?
Mr. GRANGER. Yes.
The CHAIRMAN. It is a fact that some of the large private corporations, seeing the situation which has existed in these city marketing areas, have gone outside the cities and have built their warehouses so as to facilitate the handling of fruits and vegetables and perishable commodities. Is that not right?
Mr. CROW. That is a fact.
The CHAIRMAN. And those facilities are easily accessible to trucks and trains.
Mr. CROW. That is right.
The CHAIRMAN. The modern market you visualize, and the one you have designed, does contemplate the use of rail and truck transportation to the market?
Mr. CROW. That is right.
The CHAIRMAN. So that the trucks and trains both can be easily and economically unloaded; is that right?
Mr. CROW. It would provide essentially for the rest of these people as efficient facilities as those few private firms have provided for themselves.
The CHAIRMAN. That is right. In doing that, it would stand to reason that the consumer would benefit; the farmer would benefit, and the wholesale merchant certainly would not suffer?
Mr. CROW. And the retail grocer would not suffer.
The CHAIRMAN. And the retail grocer would not suffer. You would just eliminate the loss from wastage and spoilage, and lift the burden which is now heavy upon the distribution system; is that right?
Mr. CROW. Yes; it is.
The CHAIRMAN. Even if you abandon these markets where they are now located, the property upon which these rat holes are now located would still be valuable real estate which could be used for other purposes; is that right?
Mr. CROW. I have talked with city planning officials in some of these cities where this problem is the greatest, and they tell me it is their considered opinion that if you would tear out the area and get enough land to be worth something for other uses the value of the property after clearing it out and putting it to an alternative use would undoubtedly be greater than the value now.
The CHAIRMAN. As it is, some of the tenants in these buildings,