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is now by corporations.

"There would be about twice as much chance, one in five, that I should open by saying: 'Mr. Mayor, and residents of urban America...'

"Out of three million farm income tax returns in 1965, there were 680,000 or 22 percent filed by people who deducted farm losses from non-farm income and still had some income tax to pay on their non-farm income. That included 96 percent of all persons who paid on $1 million income or more, 84 percent of those who had $500,000 to $1,500,000 income, and 73 percent of those with $100,000 to $500,000 income."

What is occurring in rural America is not as apparent as changes in other segments of the society.

When a new process displaces a few hundred factory workers, or a factory owner decides to move or close down, it makes a graphic impression. The newspapers take up the cause. They interview the displaced workers. They photograph the darkened factory. The chamber of commerce looks for a new industry.

But when low prices or a new gadget attached to a tractor throw thousands of farm hands out of employment, the tragedy is seldom visible. They are not all bunched in one area. Displaced farm families vanish one by one into the obscurity of the city or into the misery of a back street in the nearest small town.

The consequences of the change is not merely social, of course. It is physical. As has been mentioned previously, the land and water resources are being depleted. It would not be excusable even if communities were being helped. But here is one example.

Self-propelled irrigation is spreading. One automated system irrigates 133 acres at a time. But it is the most intensive kind of farming known to man.

A glowing report appeared in the Platte Valley (Neb.) Farmer Stockman in July, 1968, telling of the installation of many systems in Holt County, Nebraska. The issue also had substantial advertising lineage from irrigation companies, of course.

The publication reported on the heavy investment required and the higher yields that occurred.

But it continued:

"But they (conservationists) are concerned about the creation of severe erosion, since some of the slopes border on 15 degrees or better." The story did not comment further on this alarming possibility. Further in the story, another revealing paragraph occurred:

"Surprisingly, the big change in the look and mode of farming and ranching

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has not yet made a significant boom for the area in general. Like most rural Nebraska counties, Holt County is gradually losing population."

We have discussed the effects of the corporate invasion in the rural areas. But these effects are being felt elsewhere, too. Assistant Secretary of Agriculture John Baker told the President's Commission on Civil Disorders on November 2, 1967:

"Past developments and trends in rural America--particularly on our farms--are directly related to, and are some of the fundamental causes of, urban civil disorder. Those of us who have been close to agriculture over the years have seen the inexorable thrust of modern technology and organization literally overwhelm millions of families--white and Negro--in the countryside--force them off the land and into the towns and cities, where both white and Negro add to the overcrowding that leads to explosion."

It is not merely a matter of overcrowding. The migration to the city involves a painful readjustment.

Baker commented further before the Senate Select Committee on Small Business, Subcommittee on Financing and Investment on June 27, 1968:

"They say goodbye to old friends, sever lifelong church affiliations, and leave behind family homes and familiar surroundings. In the cities, they are forced to make further sacrifices. No longer can they roam downtown sidewalks and parks without fear. They have to rise earlier in the morning, drive farther to work, and return home later at night, giving them less time to spend with their families. They have to cope with all the problems that come from having too many people in too little space--increased traffic, smog, inner city decay, the loss of individuality, rising tax rates, more demands and less incentive or purpose."

Is this the direction we want to go?

The Garbage Can Horizon

Secretary of Agriculture Orville Freeman cites the disappearance of three million farms from 1945 to 1955, the migration of 20 million people from the country to the city, and the submigration of a third of the cities' original population to the suburbs.

Then, he said:

"A generation passed, and more; a generation that had firsthand experience with the cockroach and the rat--but had never, many of them, seen a butterfly; whose view was bounded by garbage cans and concrete, but who had never seen a tree or an open field.

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Who had lost, most damning of all, that one item that made the

hardships of an earlier frontier bearable... hope."

What is happening is damaging the body and soul of America.

We must recognize that the institutional values of the corporation are inconsistent with the welfare of rural America. And they are gathering strength rapidly.

Do not imagine that the corporate system is merely one of aggressive investors who make it big. The ownership of most of the big corporations lies in other corporations. The Subcommittee on Domestic Finance of the House Banking and Currency Committee says too much of the ownership and control lies in the big banks. In two massive volumes issued on July 9, 1968, this subcommittee, headed by Congressman Wright Patman (D-Tex.), said that banks control much of the Nation's business through direct ownership, interlocking directorships, administering trust funds, and other ways.

The subcommittee looked at the 20 largest companies and found 23 interlocks with the directors of banks.

The most massive, from the standpoint of control, seemed to be the Morgan Guaranty Trust Company of New York. This bank had interlocking directorships, administered employee benefit funds with common stock, or owned stock in National Dairy Products Company, General Foods Corporation, Campbell Soup Company, Standard Brands, and the Great Atlantic and Pacific Tea Company.

Of further interest to farmers, it owns eight percent of the common stock of Deere and Company.

Nor is interest in food companies confined to Morgan Guaranty Trust, of course. Chase Manhattan Bank of New York has interests of one kind or another in Safeway Stores, Inc., Grand Union Co., Purity Stores, Inc., and the International Basic Economy Corporation, which operates table egg and broiler breeder operations in the United States and 25 other countries.

Of 49 big banks surveyed by the subcommittee, they found: Fourteen director interlocks in canning and preserving fruits and vegetables, 14 employee benefit accounts, and 8 instances where the bank owned 5 percent or more common stock;

In grocery and miscellaneous food stores, 17 interlocks, 16 employee benefit accounts, and 11 instances where the bank owned at least 5 percent of the common stock.

69-133 O 72 pt. 2 14

When the subcommittee finished the survey of the 49 banks, they found interests in hundreds of corporations in 132 categories of industry--with a total of 1,062 interlocking directorships, 1,251 employee benefit funds administered by the banks, and 707 instances where the banks owned or controlled more than 5 percent of the common stock.

The subcommittee staff said the labyrinthine links among banks and non-financial institutions raise serious questions of conflict of interest and anti-competitive practices.

On the same day that the subcommittee's report was publicized and Congressman Patman was calling for an FTC investigation, the New York Times reported gains in the earnings of Morgan Guaranty Trust Company. Net operating earnings during the first half of 1968 for Morgan was 10.86 percent on equity. Morgan has trust assets of $16.8 billion. It also owns interests in five other big New York City banks, and its operative power is impossible to estimate.

The Controlled Environment

Investment letters tell of the purpose of the conglomerate mergers-attempting "to control their environment rather than be controlled by it." One letter cited the growth of one such conglomerate, the Ogden Corporation--with substantial holdings in food: "This growth has been accomplished

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through a willingness to utilize financial leverage and acquisitions."

On July 10, 1968, the Washington Star quoted a Chicago-based financial consulting firm specializing in mergers and acquisitions that during the first six months of 1968 there were "a record 1,703 corporate consolidations--up 20.3 percent over the 1,416 reported for the comparable 1967 period."

But the close relationship of business and politics was emphasized on that same day when Dan Dorfman of the Wall Street Journal reported the financial community's reaction to the Federal Trade Commission's announcement that it was going to investigate the conglomerate merger trend. "It's going to be a lousy day. I think practically all the conglomerate stocks will take a beating."

But Wall Street has considerable confidence in its ability to deal with the vicissitudes of politics and, although conglomerate stocks did decline the day after the FTC announcement, said Dorfman, "the overall losses weren't as severe as he anticipated."

One analyst referred to the FTC study as merely "psychological warfare" with the conglomerates and not to be taken too seriously. "First, there's a study to be completed, and then there's the question of passing legislation," the analyst observed. As television's Maxwell Smart would say, "It's the oldstudy-and-question-of-passing-legislation game."

Secrecy is the code of the big corporations. The Wall Street Journal reported on June 27, 1968 that CBK, Inc. had received approval from the Securites and Exchange Commission to omit quarterly financial statements. The reason? "Because of the change in its operations from diversified manufacturing to farming," said the Journal. The report continued:

"CBK said it also was considering asking the SEC for permission to omit semiannual reports, but a decision hadn't been reached. CBK said interim reports for a farming company tend to be meaningless because of the seasonal nature of crop harvests."

They tell as little as possible about their operations. And what they tell does not always square with the facts.

R. Hal Dean, chairman of the board and president of the Ralston Purina Co. discussed his corporation's business in an article digested in the June 1, 1968 issue of "Feedstuffs" from a talk he made to the 60th annual convention of the American Feed Manufacturers Association. He admitted that "of course" the broiler business is almost totally integrated.

"But in other classes of livestock and poultry production I would make this categorical statement. Our Chow division is dedicated to perpetuating the independent producer. Ralston Purina Company has no interest whatsoever in moving in the direction of corporate farming for itself. We do not desire