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stitutional character. Certain proposals seem especially subject to reservations in the light of the relatively narrow scope of the committee's hearings and the wide impact which these proposals would have if implemented.

Another aspect of this report we find subject to question is the rather significant variance in some of the cited statistics from the data presented in two publications by the Economic Research Service of the Department of Agriculture. These publications, Corporations Having Agricultural Operations, A Preliminary Report and Preliminary Report II, cover activities in 47 States. Although two States having a high level of corporate activity, California and Hawaii are not included in these reports; the data given for the other States, including Texas and Florida, both having heavy corporate farming operations, does not lead to the same conclusions as those reached in the subcommittee's report.

Conclusion. Because of inconsistencies between the subcommittee's and USDA's reports, as well as the nature of some of the subcommittee's recommendations, we believe this subject deserves broader statistical analysis and more thorough investigation before any specific legislative action is initiated.

ROBERT DOLE. MARLOW W. COOK.

STATEMENT OF MESSRS. MCINTYRE AND GRAVEL

At the time the hearings were conducted, which constitute the basis for this report, we were not members of the Select Committee on Small Business. We, therefore, reserve judgment at this time as to the conclusions and recommendations contained in this report, but we certainly have no objection to the issuance of this report.

THOMAS J. MCINTYRE.
MIKE GRAVEL.

STATEMENT OF MR. STEVENS

During the period covered by this report, I was not a member of the Select Committee on Small Business. While I do not object to the issuance of this report, I reserve judgment, at this time, as to the conclusion and recommendations contained herein.

TED STEVENS.

APPENDIX

A. SUMMARY OF ARVIN-DINUBA STUDY 52

Whether industrialization of farming is a threat not only to the family farm, but also to the rural society founded upon the family farm, is the specific subject of the present report. The purpose of this study is to test by contemporary field research the historic hypothesis that the institution of small independent farmers is indeed the agent which creates the homogenous community, both socially and economically democratic.

The present inquiry consists of a detailed analysis and comparison of two communities, one where agricultural operations are on a modest scale, the other where large factory-like techniques are practiced. Both communities lie in the fertile southern San Joaquin Valley in the Great Central Valley of California, where highly developed and richly productive agriculture is characteristic. Limitations of time and resources dictated that no more than two communities be studied. Numerous other pairs might have been chosen which doubtless would have yielded comparable results.

The two communities studied naturally vary in some degree with respect to proportions of surrounding lands devoted to this or that crop, with respect to age, to depth of water lift for irrigation, etc., as well as with respect to the scale of the farm enterprises which surround them. Controls as perfect as are possible in the chemist's laboratory are not found in social organizations. Yet the approximation to complete control achieved by selection of the communities of Arvin and Dinuba, is surprisingly high. Other factors, besides the difference in scale of farming, which might have produced or contributed to the striking contrasts of Arvin and Dinuba have been carefully examined. On this basis the conclusion has been reached that the primary, and by all odds the factor of greatest weight in producing the essential differences in these two communities, was the characteristic difference in the scale of farming-large or small-upon which each was founded. There is every reason to believe that the results obtained by this study are generally applicable wherever like economic conditions prevail.

SUMMARY OF FINDINGS

Certain conclusions are particularly significant to an understanding of the importance of his place in a community. Not only does the small farm itself constitute small business, but it supports flourishing small commercial business.

Analysis of the business conditions in the communities of Arvin and Dinuba shows that

52 This brief report is taken from pp. 4-6 of the hearing record of the Subcommittee on Monopoly.

(29)

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(1) The small farm community supported 62 separate business establishments, to but 35 in the large-farm community; a ratio in favor of the small-farm community of nearly 2 to 1.

(2) The volume of retail trade in the small-farm community during the 12-month period analyzed was $4,383,000 as against only $2,535,000 in the large-farm community. Retail trade in the smallfarm community was greater by 61 percent.

(3) The expenditure for household supplies and building equipment was over three times as great in the small-farm community as it was in the large-farm community.

The investigation disclosed other vast differences in the economic and social life of the two communities, and affords strong support for the belief that small farms provide the basis for a richer community life and a greater sum of those values for which America stands, than do industrialized farms of the usual type.

It was found that

(4) The small farm supports in the local community a larger number of people per dollar volume of agricultural production than an area devoted to larger-scale enterprises, a difference in its favor of about 20 percent.

(5) Notwithstanding their greater numbers, people in the smallfarm community have a better average standard of living than those living in the community of large-scale farms.

(6) Over one-half of the breadwinners in the small-farm community are independently employed businessmen, persons in whitecollar employment, or farmers; in the large-farm community the proportion is less than one-fifth.

(7) Less than one-third of the breadwinners in the small-farm community are agricultural wage laborers (characteristically landless, and with low and insecure income) while the proportion of persons in this position reaches the astonishing figure of nearly two-thirds of all persons gainfully employed in the large-farm community.

(8) Physical facilities for community living-paved streets, sidewalks, garbage disposal, sewage disposal, and other public servicesare far greater in the small-farm community; indeed, in the industrial-farm community some of these facilities are entirely wanting.

(9) Schools are more plentiful and offer broader services in the small-farm community, which is provided with four elementary schools and one high school; the large-farm community has but a single elementary school.

(10) The small-farm community is provided with three parks for recreation; the large-farm community has a single playground, loaned by a corporation.

(11) The small-farm town has more than twice the number of organizations for civic improvement and social recreation than its large-farm counterpart.

(12) Provision for public recreation centers, Boy Scout troops, and similar facilities for enriching the lives of the inhabitants is proportioned in the two communities in the same general way, favoring the small-farm community.

(13) The small-town community supports two newspapers, each with many times the news space carried in the single paper of the industrialized-farm community.

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(14) Churches bear the ratio of 2 to 1 between the communities, with the greater number of churches and churchgoers in the smallfarm community.

(15) Facilities for making decisions on community welfare through local popular elections are available to people in the small-town community; in the large-farm community such decisions are in the hands of officials of the county.

These differences are sufficiently great in number and degree to affirm the thesis that small farms bear a very important relation to the character of American rural society. It must be realized that the two communities of Arvin and Dinuba were carefully selected to reflect the difference in size of enterprise, and not extraneous factors. The agricultural production in the two communities was virtually the same in volume-$212 million per annum in each-so that the resource base was strictly comparable. Both communities produce specialized crops of high value and high cost of production, utilizing irrigation and large bodies of special harvest labor. The two communities are in the same climate zone, about equidistant from small cities and major urban centers, similarly served by highways and railroads, and without any significant advantages from nonagricultural resources or from manufacturing or processing. The reported differences in the community may properly be assigned confidently and overwhelmingly to the scaleof-farming factor.

The reasons seem clear. The small-farm community is a population of middle-class persons with a high degree of stability in income and tenure, and a strong economic and social interest in their community. Differences in wealth among them are not great, and the people generally associate together in those organizations which serve the community. Where farms are large, on the other hand, the population consists of relatively few persons with economic stability, and of large numbers whose only tie to the community is their uncertain and relatively low-income job. Differences in wealth are great among members of this community, and social contacts between them are rare. Indeed, even the operators of large-scale farms frequently are absentees; and if they do live in Arvin, they as often seek their recreation in the nearby city. Their interest in the social life of the community is hardly greater than that of the laborer whose tenure is transitory. Even the businessmen of the large-farm community frequently express their own feelings of impermanence; and their financial investment in the community, kept usually at a minimum reflects the same view. Attitudes such as these are not conducive to stability and the rich kind of rural community life which is properly associated with the traditional family farm.

Senator STEVENSON. Senator Hughes would you care to go ahead with your opening statement?

Senator HUGHES. Mr. Chairman, my statement is brief.

As you know, I share your belief that these hearings are of vital importance to farmworkers, farmers, and rural America. What we are really investigating here is the nature of present-day American agriculture and landholding patterns, and the prospects of family farming for the future.

I want to express my appreciation to the witnesses who have agreed to appear this morning—including representatives of the Nation's farm organizations to offer us their views and open themselves to the questions of this subcommittee.

I am disappointed, however, that the Nation's largest farm organization-the American Farm Bureau Federation-has decided not to testify here today, though they have filed a statement for the record.

There are about 2.9 million farms left in America. Of those, 2.3 million are small- or medium-sized operations. The Farm Bureau claims to have 2 million family members. I would think that they would have quite a stake in the issues we are discussing.

I have read with great interest the statement submitted by the Farm Bureau. Their position-that "there is no clear evidence that large corporations controlled by nonfarm interests are taking over agriculture”—is in sharp contrast to other testimony we have heard. It is diametrically opposed to the statement of National Farmers Organization President Oren Lee Staley that "corporate agriculture, as it is now developing, is like a cancer eating away at the heart of American agriculture," and the testimony of National Farmers Union representative Raymond Watson that "the vertically integrated operation is, I believe, the most serious threat facing family agriculture in America. It is an alarming development. It must be halted."

Some of the evidence already stated this morning supports certainly at least in part that statement.

Why is there such a discrepancy between the views of these two other major farm organizations and the Farm Bureau, all of which claim to speak for American farmers? I would like to ask the Farm Bureau representatives that question-as I will ask the NFO and NFU representatives—but that is precluded because the Farm Bureau is not here.

The members of this committee approach these matters with an open mind. But in the process of drawing our conclusions, it seems essential that we hear from all of the forces at work in rural America. I am also disturbed that none of the seven major food processors that were invited in September to testify have yet positively responded. Why will small farmers, farmworkers, rural social action agencies, and all the other major farm organizations appear, but not the processors and the Farm Bureau?

What can be of greater priority to America's family farmers than the prospects of their survival? I am sure that the chairman of this committee would welcome the appearance of the Farm Bureau and of the Nation's food processors at a later session of these series of hearings, if they are willing and able to give us the time. I think it is of ultimate importance that they do so.