For the past several years, this program has consisted largely of payments to farmers for application of fertilizer and other approved soil management practices.  I am convinced that farmers generally are now fully alert to the benefits, both immediate and long-term, which they derive from the practices encouraged by this program.  I believe, therefore, that this subsidization should continue to be reduced.

Rural electrification.—­It is proposed that the loan authorization for the Rural Electrification Administration for the fiscal year 1947 be increased from 200 million dollars to 250 million dollars.  During the war period, Rea was limited by the scarcity of materials and manpower.  But that situation is rapidly changing, and the Rea program, which was materially stepped up for the fiscal year 1946, can be increased still more.  It is my belief that a feasible and practical rural electrification program should be carried forward as rapidly as possible.  This will involve total loans of approximately 1,800 million dollars over the next 10 years, much of which will be repaid during that period.

Other programs.—­It is recommended that the continuing forest land-acquisition program be resumed at the rate of 3 million dollars annually, which is about the minimum rate at which this program can be economically carried on.  The lands involved in this program can contribute fully to the national welfare only when brought into the national forest system for protection and development.

Such programs as those of the farm Security Administration and the farm Credit Administration are estimated to be continued during the fiscal year 1947 at about the same level as in the fiscal year 1946.  Recent action by the Congress has Permitted some expansion of the school lunch program.  I hope it will be continued and expanded.  The budgets of the Federal Crop Insurance Corporation and the federal farm Mortgage Corporation will be transmitted in the spring under the terms of the Government Corporation Control Act.

4.  Transportation

Transportation is one of the major fields for both public and private investment.  Our facilities for transportation and communication must be constantly improved to serve better the convenience of the public and to facilitate the sound growth and development of the whole economy.

Federal capital outlays for transportation facilities are expected to approximate 519 million dollars in the fiscal year 1947.  State and local governments may spend 400 million dollars.  Private investment, over half of it by railways, may approach 1,150 million dollars.

The Congress has already taken steps for the resumption of work on improvement of rivers and harbors and on the construction of new Federal-aid highways.  Much needed work on airports can begin when the Congress enacts legislation now in conference between the two Houses.