Mr. PETRIE. The reason I answered it in the way I did was simply this: You asked me a question about $50,000,000, and I could not answer you any more directly than I did when I said that we might figure it on the basis of $20 per head. Of course, we do not know that we will have $50,000,000 to spend.

Mr. TABER. Assuming that you will have $50,000,000 to spend for dairy and beef products, how many cows can you get rid of in that way?

Mr. PETRIE. I do not know. It would depend on the cost of the cows. They may cost $20 per head, or they may cost more. They may cost $25 per head. I do not know what portion of the $50,000,000 will go for dairy products, butter, cheese, and so forth.

Mr. TABER. Now, would you figure that you would get rid of 1,000,000 cows under this dairy and beef products proposition, or more?

The CHAIRMAN. That amount would be for relief.

Mr. PETRIE. Those cows we expect will go into the relief work. No, sir; I would not say so. We would not get rid of 1,000,000 cows in that way. I would rather you would be a little elastic in that, making it, say, 750,000 cows. Let us have a little cushion there.

Mr. TABER. How many more would you figure you would get rid of up to January 1, besides those 600,000 head and 750,000 head? Mr. PETRIE. We would like to get rid of something over 2,000,000 cows, if possible, during the calendar year.

Mr. TABER. Then you would need, perhaps, $20,000,000 more.
Mr. PETRIE. Possibly; yes, sir.

Mr. TABER. If you had $100,000,000, you would have plenty of money to operate on this year, would you not?

Mr. PETRIE. In addition to the $50,000,000.

Mr. TABER. When I say $100,000,000, I am including that. Mr. PETRIE. I do not think that would be sufficient, for this reason: We are anticipating a sign-up of people to reduce the number of females they have on their ranges, and in order to get that sort of sign-up, we will have a regular definite program outlined for the future. There must be a program almost concerning those cattle, and we must have funds available, if we are to attain the end that we desire and think

necessary.

The CHAIRMAN. Do you mean if you take a farmers contract for the purchase of cattle, you must have the money with which to back it up? Mr. PETRIE. Yes, sir. That is tremendously important. It is tremendously important to have a fund to start off with, so they will not be handicapped in this work. If that fund is appropriated, it would not be necessary to spend it unless there was an absolute need for it.

The CHAIRMAN. There is another thing that might be developed. here: You could not obligate the Government by contract to purchase all of those cattle unless the money had been appropriated with which to fulfill the contract.

Mr. PETRIE. No, sir; we could not.

The CHAIRMAN. You would have to have specific authority to do that.

Mr. PETRIE. We could not do that without authority.

Mr. JUMP. If once the appropriation were made, so that we then knew what Congress authorizes, we would go ahead, but you cannot

down and close yourself up in a room and try to write up a comee plan for something like the adjustment of the cattle industry. You could take an item of $25,000 or $50,000, for a regular piece of Government work, and plan for it in that way, but where you are

ng with the welfare and daily lives and economic situation of ons of people, you cannot draw that up in a document prepared advance of the knowledge of the amount that will be available for the program. If we knew what Congress would authorize or give us for this work, then there would be a program made that would be watertight, and a businesslike economical administration of it could be set forth in the regular estimating form.

Mr. TABER. If you should use $20,000,000 for tubercular cattle and $50,000,000 for dairy and beef products, you will still have $80,000,000 left for the purpose of getting rid of cows. Now, you certainly ought to get rid of one for each $40 that you have on hand, and that would allow you to get rid of 2,000,000 more cattle.

Mr. PETRIE. You have not figured on the administrative cost. Mr. TABER. You told us that the administrative cost would not be so very heavy.

Mr. PETRIE. I meant by comparison. I said it would be low as compared with the other work we have handled so far. What I meant to indicate by that testimony was that it would be less proportionately.

Mr. TABER. There is nothing in here about dairy products in the upper section anyway.

Mr. JUMP. It relates to both the dairy- and beef-cattle industry. Mr. TABER. We are supposed to be getting rid of cows.

Mr. PETRIE. Let me assume for this purpose, just arbitrarily, that $20,000,000 for dairy products is included in the bill. We do not know the amount that will be allocated to that, but I think it would be conservative, at least, to allow $20,000,000 for the purchase of dairy products.

Mr. TABER. Would you estimate that with the $150,000,000 you would get rid of 3,000,000 head of cattle?

Mr. PETRIE. I think so. It looks that way.

Mr. TABER. How would that be split as between the dairy group and beef cattle?

Mr. PETRIE. That would depend entirely upon the reception that this contract would receive from the dairy people. My thought is that the beef-cattle people would respond more promptly or more readily than the dairy people. Only time will demonstrate the way that group will receive it. It might be assumed that they would not be so ready to sign up with dairy cattle as with beef cattle. Of course, it would be more desirable to have the response more largely in dairy cattle than in beef cattle. That would improve the condition with regard to the general cattle population of the country, because we have so many dairy cattle.

Mr. TAYLOR. If we have a drought, and large numbers of beef cattle are forced on the market suddenly, we will have a bad economie situation.

Mr. PETRIE. That is very true.

The CHAIRMAN. You will have to treat these two propositions together. As between beef and dairy cattle, it will be about 30–50. Mr. JUMP. Under the law, under section 2, not more than 60 percent can be spent for either industry.

The CHAIRMAN. It will be either on a 40-60 basis, or a 50-50 basis. It will probably be on a 50-50 basis. That would be fair to both industries.

Mr. TAYLOR. You are starting a hearing here that is making history.

Is there anything else you want to tell the committee?

Mr. PETRIE. No; not unless it is developed by some questions that you want to ask. I think it is fairly well set forth.

Mr. TAYLOR. I think so.

ESTIMATED PROCESS TAX FROM CATTLE INDUSTRY

Mr. TABER. How much processing tax do you expect to get out of the cattle industry?

Mr. PETRIE. Well, under the various plans considered, it will vary from 13 to 14 million dollars a year up to three times that much. The CHAIRMAN. Three times that?

Mr. PETRIE. You can put the figures down definitely and say between $14,000,000 and $40,000,000.

However, as I previously stated, we have assembled a list of figures and suggested plans that will all be determined in the very near future by the help or assistance of the actual cattle producers who will meet here tomorrow for that purpose. And until we have had a general discussion as to what plan may be adopted, you can see how indefinite this whole matter is. But this is an emergency just the same, because unless something is done in a substantial way our hands are tied, and we cannot even start until funds are available.

The CHAIRMAN. I notice there are some Senate amendments to this bill, including tobacco, wheat, rye, flax, peanuts, and grain sorghums. There is nothing in the estimate contemplating any relief along those lines or has that been determined yet?

Mr. PETRIE. I could not answer that.

Mr. JUMP. We have only dealt here with the subject of cattle and dairy products. Of course, the regular machinery of the act is applicable to the basic commodities that were put in this bill.

Mr. TAYLOR. That is not a part of your job just now.
Mr. PETRIE. No.

ESTIMATED PERSONNEL AND ADMINISTRATIVE EXPENSES

Mr. TAYLOR. Can you tell us something about your anticipated personnel set-up, the machinery, and the modus operandi for carrying out this program, or have you developed that yet? What proportion of this money will go for salaries and things of that kind?

for

Mr. PETRIE. Of course, that will be indefinite, but I might say your information that we have a plan in mind that we think is perfectly practical in every way, and that the administrative machinery will be light.

Mr. TAYLOR. Will you hold down the salaries so we can afford to pay them?

Mr. PETRIE. If we put over our plan, that set-up will be so very simple and inexpensive, that you will be surprised. I am willing to stake what little reputation I have on that. In other words, I would

not look upon that as a bugbear at all. I do not think the administrative machinery will be as expensive as you imagine.

Mr. TAYLOR. The only safeguard or watchdog under the blue sky that the taxpayers have is in this Appropriations Committee. That is the only agency that gives protection to the taxpayers of this country. There is no other agency that does that, and we have got to be the watchdog all the time.

The CHAIRMAN. I want a set up of your additional personnel under this bill. You can make it up tentatively upon the assumption that you will get $150,000,000. I want that set-up supplied for these hearings. We will want it probably tommorrow. Are your new employees under the classified service?

Mr. JUMP. They are under the classification act as to the salaries they are paid. Under this act they would have to be subject to the classification act. This is different from the Bankhead Act, which exempts them.

The CHAIRMAN. They have to take a regular civil, service examination?

Mr. JUMP. No; I am speaking now of the salaries. As to the salaries, they are regulated under the classification act.

The CHAIRMAN. You can get your employees either way?

Mr. JUMP. Either way, but the salaries have to be under the provisions of the Classification Act, the same as it applies to the general departments of the Government.

The CHAIRMAN. All additional employees under this bill will be subject to exactly the same conditions and restrictions to which all other employees under the A.A.A. are subject?

Mr. JUMP. That is correct. There is no legislation here whatsoever that changes the enactment in the original A.A.A Act with respect to employment. In fact, this is really an amendment to the A.A.A Act; that is what the bill amounts to.

The CHAIRMAN. This bill practically applies the provisions of the A.A.A Act in trying to do for the cattle industry the same thing you are trying to do for cotton, wheat, and so forth.

Mr. JUMP. Yes, sir; it does that quite definitely under section 2. Mr. TABER. How many employees do you figure you will have in connection with this proposition?

Mr. PETRIE. You mean in the country?

Mr. TABER. For cattle.

Mr. PETRIE. We are not nearly that far along yet.

Mr. TABER. Will it be 1,000 or 20,000?

Mr. PETRIE. I expect that, roughly, it will be something like this set-up, that we will have a county committee, something similar to the other commodities now being handled. That will consist of three unpaid men.

Then in addition to that, I imagine our personnel will possibly not amount to over five to a State.

This is all purely an estimate, assuming that the program we now have in mind, which has not yet been developed, will be carried out something along the lines we are now thinking about.

In other words, as I stated earlier in the afternoon, we anticipate that the mechanics, the machinery for the handling of this cattle problem, will be comparatively simple. But I want to say further I cannot presume to estimate anything about the expenses of the

Bureau of Animal Industry in its disease eradication, because we are not in a position to do that. I am speaking now strictly of the surrender of cows, beef and dairy, outside of the diseased cattle. Inspection and elimination of diseased cattle is an entirely different problem, and that comes directly all the time under the Bureau of Animal Industry.

Now, an estimate of that sort from Dr. Mohler, Chief of the Bureau of Animal Industry, should be a portion of this estimate, Mr. Buchanan. That would be one part and our section would be the other part.

Mr. JUMP. It depends on how much money he would need to use in connection with tuberculosis or abortion activities. He could make an estimate of that.

Mr. PETRIE. He has the machinery now in operation, and we do not. His organization is perfected. You may have to add to that organization, but it is established, whereas we must establish all of

ours.

We will get you the list you asked for, but that is purely a tentative estimate.

Mr. JUMP. We are in a peculiar position in discussing this matter. If you had held a similar hearing right after the 3-A act passed on what was going to be done on these different programs, it would not have been any more definite than we have been able to be on this. This morning we had a hearing on cotton, but we were able to figure fairly definitely on that. We have had a wonderful experience with cotton and so could present the matter on that basis.

The CHAIRMAN. You have had considerable experience with emergency programs on other things, and it ought not to take you long to consider this.

Mr. JUMP. But we are dealing with another great group of the population, Mr. Chairman, and we have to consider their methods of thought, their economic situation, and so on. Every one of them is entirely different, and they are very widely scattered in this case. Mr. PETRIE. You see, we take in 48 States with this plan. Mr. TAYLOR. We hope when you come before this committee in January you will be able to report wonderfully successful progress. UNITED STATES DEPARTMENT OF AGRICULTURE, AGRICULTURAL ADJUSTMENT ADMINISTRATION, Washington, D.C., May 9, 1934.

Hon. J. P. BUCHANAN,

Chairman Committee on Aprpopriations,

House of Representatives.

DEAR MR. BUCHANAN: As requested by your committee during a hearing on the appropriations under Public, No. 42, Seventy-third Congress, I am pleased to submit herewith a tentative break-down of expenditures for the purpose of starting and developing a program under this act. We have included in this statement a tentative breakdown of the administrative expenses, as requested by you.

I am sure that you will appreciate something of the difficulties in connection with working out programs of this character, particularly where they cover such a wide and diversified field, and for that reason we desire to make it plain that this is purely tentative. Unquestionably, as our consideration of the whole situation with the industry progresses there may have to be very radical changes in the proposed program. This must be taken into account in connection with any statement prepared at this time.

If additional information is desired, we shall be glad to furnish it.

Sincerely yours,

C. C. DAVIS Administrator.