Mr. SLAMP. I am here to represent the National Association of Marketing Officials. I have tried to bring together the consensus of opinion of the national association and not necessarily my own personal feeling about this matter.

The National Association of Marketing Officials has been interested in the improvement of marketing facilities for perishable foods for many years. In 1936 this interest was crystallized when the United States Department of Agriculture conducted research projects on the Philadelphia and New York City wholesale markets. Since that time the NAMO has been kept well informed on the progress of market facilities improvements through reports and advice from the Market Facilities Branch of the United States Department of Agriculture.

Since the House committee is probably well informed on the need for modernizing facilities for assembling and distributing perishables, this report does not propose to enter into detail on the excessive wastes and costs which are incurred in the handling of foods through antiquated facilities. Traffic congestions, overcrowded facilities, lack of proper warehousing, unnecessary loading and unloading and porterage costs, unsanitary conditions, are commonplace in many of our large terminal markets. The lack of centralization in handling separate lines of perishables and the lack of facilities for direct unloading of rail receipts cause unnecessary charges on the marketing bill.

If the observations of the National Association of Marketing Officials have been correct, one of the principal difficulties faced by most groups who see the need for and wish to act upon improvements, has been the lack of investment funds. The NAMO believes that the so-called Cooley bill, H. R. 8320, is a constructive method toward solving this problem. The proposal for a marketing facility loan fund is to be commended for its flexibility. The fact that its application would not be obligatory affords the opportunity for interested groups to apply for or reject the offered financial assistance.

The National Association of Marketing Officials favors this constructive legislation.

That ends the statement.

The CHAIRMAN. Thank you very much for your statement and for your appearance here. Let me just ask you one question, if I may. Mr. SLAMP. Yes, sir.

The CHAIRMAN. Do you hold to the idea that these big terminal markets are impressed with the public interest for the reason that such great quantities of produce pass through the markets?

Mr. SLAMP. Yes, sir; I do.

The CHAIRMAN. In other words, the point that I have in mind as the justification for this legislation is the fact that so many different people from so many different communities in this great country of ours transact business in these centrally located terminal markets. Mr. SLAMP. Yes, sir.

The CHAIRMAN. Kind of proceeding with the theory that what is everybody's business is nobody's business, we have tolerated this situation through the years. It now occurs to me that something

should be done about it.

Do you feel that the farmers of the Nation, as well as the consumers and as well as the handlers, have an interest in these markets?

DEVELOPMENT OF TERMINAL MARKETING FACILITIES

33

Mr. SLAMP. I might preface my remark by saying that I was one of the original cooperators studying the Philadelphia market back in 1935 with Mr. Crow. There is no doubt about it. I do not think there is any question about it.

I do want to say that I believe the national association believes that private capital and private investment should make these changes; but, as you say, it has not been done. That was in 1935. Many years before that the need was there. There just is not that crystallization of action, I would call it, to get it to the active point.

I do know as an extension member of Rutgers in New Jersey at the time we tried to promote private interest in improving Dock Street and Terminal Markets that after 3 years of attempts finally it had to be dropped. We could not crystallize the interests. There are so many special interests there that are at cross-purposes that it was an impossibility for us. The farms had one idea. The property owners had another idea. The commission merchants who operated on rented facilities had other ideas about it. It was very difficult to crystallize the action at that time. I think that still holds, probably.

The CHAIRMAN. Of course, it is easy to see how a property owner who is now exacting an enormous rent and perhaps an unreasonable rent for inadequate facilities would like to be let alone and permit the public to continue to transact business in such an establishment. Looking at it from the broad viewpoint of the consumer and producer it just occurs to me that it is a situation we should do something about.

Mr. SLAMP. That is right.

The CHAIRMAN. I want to thank you very much for your appearance here on this occasion.

Mr. SLAMP. I wanted to add that Mr. Birdsall from New York, who was the other member appointed to come down here and appear, has at the present time sent out telegrams to each member to get their opinions. He is going to crystallize that and get it to you by Friday, we hope.

The CHAIRMAN. Thank you very much.

Mr. SLAMP. Thank you, Mr. Chairman.

The CHAIRMAN. Mr. L. Y. Ballentine, the Commissioner of Agriculture of the State of North Carolina; we would be glad to hear from you now,

sir.

STATEMENT OF L. Y. BALLENTINE, COMMISSIONER OF AGRICULTURE OF THE STATE OF NORTH CAROLINA

Mr. BALLENTINE. Thank you, Mr. Chairman.

Mr. Chairman and members of the committee, to my mind this bill deals with one of the most important phases of agriculture, and today is dealing with probably the most urgent needed phase, and that is of providing marketing facilities for the marketing of perishable commodities.

The program of agriculture has been based in recent years, and the emphasis has been, largely upon production. We have been taught to produce and produce and produce, but little consideration has been given to the importance of the accompanying phase, which is that of marketing the products which we have learned to produce in everincreasing amounts. So it is fitting, I think, that we consider the problem and give it the importance to which it is entitled.

fellow who has access to these produce terminal markets is the fellow who cannot use less than five packages, that is the smallest minimum; most of them are confined to 10 or 25 packages.

So it is the little fellow who ultimately gets the merchandise, who comes down and takes advantage of this cheaper method of operation that one of my competitors outlined to you gentlemen.

And it is the little fellow, in the retail business, that we would like to see stay in the business, because he is the last link between having the monopoly, the chains, and having this small-business man in the picture, because without the small-business man probably there would be more chain-store operations.

This little fellow is discouraged from coming down to Dock Street market because he cannot get his trucks down there. He has got to come to market. He cannot find a place to park his car; he cannot get his trucks in, and has to take his packages, load them on his back and carry them out, and by the time he gets back to his place he has undergone a very expensive operation. That is, the small man is definitely at a disadvantage in buying merchandise on Dock Street, because you have to add the cost of transportation, as outlined by Mr. Rothstein, in saying that he pays a transportation bill of $1,300 for bringing commodities from the terminal to Dock Street to be offered to the little retailer.

The CHAIRMAN. And all of that, of course, has to be passed on to the retailer?

Mr. FELDMAN. That cost definitely is passed on to the consumer, and passing that cost on to the consumer definitely is a disadvantage, so far as the chain store is concerned. The chain store has a more modern method of handling its merchandise, because usually they can buy from the producer at the same price; they can bring the produce in and handle it on a more efficient basis and to a better advantage, and can sell it for less than the little fellow can sell because the chain store does not have all of these expensive operations. The chain store operation has eliminated a lot of these expensive operations. The CHAIRMAN. You operate your business in rental quarters?

Mr. FELDMAN. We operate our business just the same way that Mr. Rothstein said, we pay rent; we have an office in the building of which Mr. Custis is the agent, and we display our goods through the Pennsylvania Terminal, sell the packages to retailers just as was indicated for Dock Street. Anybody can come down and buy in sufficient large quantities.

The CHAIRMAN. You have an office in a rental place?

Mr. FELDMAN. We have an office at the corner of Third and Walnut, approximately 2.5 miles from where we do business.

The CHAIRMAN. You rent your office?

Mr. FELDMAN. Yes.

The CHAIRMAN. If you had proper marketing facilities you could operate more efficiently and you could do business with a lot less expense?

Mr. FELDMAN. Yes. We could make use of heavier trucks; we could use other facilities for handling our merchandise by trucks such as are used by our competitors.

It is not unusual to see someone come down and take out 10 packages on his back and carry them down to Water Street.

DEVELOPMENT OF TERMINAL MARKETING FACILITIES

35

likewise interested in it, and I appreciate very much your coming here to give the committee the benefit of your views concerning the bill we now have under consideration.

Mr. BALLENTINE. I would like to say this, Mr. Cooley: This is just a continuation of the marketing program, it seems to me. In 1946 the Congress wisely passed the Research and Marketing Act, and from that legislation today we are beginning to realize some very satisfactory and encouraging results, but the pay-off to the whole program of research and marketing, it seems to me, is going to depend largely upon the facilities which are made available for the marketing of these perishable commodities.

The CHAIRMAN. You do not see any objection to the Federal Government fostering a matter of this importance, do you, especially in view of what we have heretofore done in the field of agriculture?

Mr. BALLENTINE. I do not see any more objection to the participation of the Federal Government in the marketing program than in the soil conservation work or the extension work, or all the other phases that the Federal Government has entered into, which have to do with the production of commodities.

The CHAIRMAN. Actually, considered from an immediate standpoint, there is more justification for this, because obviously the consumer would benefit directly and immediately in the event these facilities are provided; is that not true?

Mr. BALLENTINE. Yes, sir; and I think it might be well to remind the members of the committee, though I know they are more conversant with that idea that I am, that the Federal Government is already in the marketing game. We are today through the support price program and the Commodity Credit Corporation participation directly connected with the marketing of all farm commodities in some way or another. Certainly if we can make the products of the farm available to the consumer in better condition, in a more acceptable condition, and at the same time present those goods to the producer at a reduced price or cost, then we will be aiding the program that we are already responsible for in some other phases of the activity. The CHAIRMAN. I have here a resolution passed by the City Council of the City of Raleigh which I would like very much to include in the record at the conclusion of your testimony. It is a resolution urging the enactment of the bill we have under consideration, H. R. 8320. Mr. BALLENTINE. I would be glad to see you do that.

Some time ago, Mr. Crow's branch of the United States Department of Agriculture made a survey of the marketing requirements in the Raleigh area, and some definite plans have been prepared for the development of that market there in the Raleigh area, but the problem of sufficient funds and finding the available funds is something that has proved to be quite difficult.

The CHAIRMAN. Mr. Crow's study of the situation in Raleigh is just part of his job; in other words, he has done that same work in other cities.

Mr. BALLENTINE. That is right.

The CHAIRMAN. We are spending the Federal taxpayers' money to conduct these investigations and these studies and to make recommendations to local municipalities and governing bodies. This bill just goes one step further, that is, to provide the financial aid to build the facilities which we consider to be needed in the different places.

The only thing they have, as far as distribution is concerned, at the distribution level, is higher rentals and higher operating costs. In other words, we are trying to serve an atomic age with armor facilities. There has been a lack of methods of handling the merchandise; there has been, fundamentally, no definite development at the distribution level.

Mr. GRANGER. Will you point out where it would be to the advantage of the farmer to be able to get more of his product to market by having this terminal market that you are talking about?

Mr. FELDMAN. It would be to the advantage of the farmer, because in the first place, the merchandise could be handled in a better manner, and there would be less handling, which would create a better demand for supplies, and since there would be less handling, the saving could be passed on to the consumer in a lower price.

That could all go back to the farmer. The advantage to the middleman would be his ability to distribute more merchandise.

Mr. GRANGER. Can you just point out any place where as a result of getting cheaper costs through such operation there has been anything sold any cheaper today than was sold years ago? As a matter of fact, when we build facilities we usually find the rents are higher and everything else is higher, is it not?

Mr. FELDMAN. I do not think they could be any higher than they are at the present time.

Mr. GRANGER. I would like to know anywhere that you can point out where it has not occurred?

Mr. FELDMAN. I do not know that I can answer that. The only thing I can say is that where they have had mass production they hold the cost down?

Mr. GRANGER. Do they?

Mr. FELDMAN. I would say they do. In other words, in the production of things like automobiles, through mass production, you are able to buy a modern car at much less price.

Mr. GRANGER. I am talking about that. I am talking about producing the same article in the same place. Big facilities cost a lot of money to produce now.

Mr. GRANGER. I am not talking about that. I am talking about producing the same articles in the same place. The big facilities cost a lot of money now. Rents are higher. Certainly labor is not cheaper. Where is the saving going to be, either to the consumer or the farmer?

Mr. FELDMAN. The saving will be in that you will be able to pass along better merchandise at the same or lower price to the consumer. When you can sell better merchandise in a better condition you are accomplishing quite a bit. In other words, when a consumer can go into a store and pick up merchandise which is maybe 1 or 2 days fresher than otherwise he is saving money. He cannot recognize it in dollars and cents, but he is saving it.

Mr. GRANGER. A saving because of less spoilage?

Mr. FELDMAN. That is right.

Mr. GRANGER. And deterioration?

Mr. FELDMAN. That is right.

The CHAIRMAN. You do know, I believe, that a tremendous amount of spoilage and waste and deterioration in food could be prevented if you could facilitate the handling of the food?

Mr. FELDMAN. That is correct.