Agricultural laws now in effect successfully accomplished their wartime purpose of encouraging maximum production of many crops.  Today, production of these crops at such levels far exceeds present demand.  Yet the laws encouraging such production are still in effect.  The storage facilities of the Commodity Credit Corporation bulge with surplus stocks of dairy products, wheat, cotton, corn, and certain vegetable oils; and the Corporation’s presently authorized borrowing authority—­$6,750,000,000—­is nearly exhausted.  Some products, priced out of domestic markets, and others, priced out of world markets, have piled up in government hands.  In a world in which millions of people are hungry, destruction of food would, of course, be unconscionable.  Yet surplus stocks continue to threaten the market and in spite of the acreage controls authorized by present law, surpluses will continue to accumulate.

We confront two alternatives.  The first is to impose still greater acreage reductions for some crops and apply rigid Federal controls over the use of the diverted acres.  This will regiment the production of every basic agricultural crop.  It will place every producer of those crops under the domination and control of the Federal government in Washington.  This alternative is contrary to the fundamental interests, not only of the farmer, but of the Nation as a whole.  Nor is it a real solution to the problem facing us.

The second alternative is to permit the market price for these agricultural products gradually to have a greater influence on the planning of production by farmers, while continuing the assistance of the government.  This is the sound approach.  To make it effective, surpluses existing when the new program begins must be insulated from the normal channels of trade for special uses.  These uses would include school lunch programs, disaster relief, emergency assistance to foreign friends, and of particular importance the stockpiling of reserves for a national emergency.

Building on the agricultural laws of 1948 and 1949, we should establish a price support program with enough flexibility to attract the production of needed supplies of essential commodities and to stimulate the consumption of those commodities that are flooding American markets.  Transition to modernized parity must be accomplished gradually.  In no case should there be an abrupt downward change in the dollar level or in the percentage level of price supports.

Next Monday I shall transmit to the Congress my detailed recommendations embodying this approach.  They have been developed through the cooperation of innumerable individuals vitally interested in agriculture.  My special message on Monday will briefly describe the consultative and advisory processes to which this whole program has been subjected during the past ten months.