may, however, decide to only deduct a part of those expenses from the payments to producers, in which event the undeducted portion would become administrative expense. He has that authority to determine whether all or part of this county expense shall be deducted from the payments to farmers.

Mr. TABER. Then it is always in the control of the Secretary?

Mr. JUMP. Yes. It is now. But it might not be if there were inflexible limitations imposed by the appropriation act and it might get matters confused between the General Accounting Office and the Department; and the farmers and others concerned with the program would be the ones who would suffer while the haggling would be going on.

We have to feel our way in the administration of programs of this kind. It is experimental from the standpoint of operating techniques. All these programs are experimental until they have been working for a while and you can tell how things are going.

After these things have been working for 2 or 3 years, I think the general rules could be applied. I don't think that we would be in a position of resistance to it then. But we would like to have made the point successfully that we are trying to provide a quality of administration which, while it is not perfect-I certainly admit that-is at least sufficiently effective to cause Congress to have confidence that we are not going around just throwing money around, but are observing all of the proprieties of the situation and can give a satisfactory accounting for our acts.

Mr. TABER. Will you give us for the record, or give us now if you can, the number of sugar producers to whom payments will be made under the act according to your present estimate?

Dr. BERNHARDT. I can give you that right now-approximately. Mr. TABER. Give it to us approximately.

Dr. BERNHARDT. Sugar-beet growers, 70,000. The cane growers from eight to ten thousand, Territory of Hawaii 3,600, and in Puerto Rico 8,000. That makes a total of about 90,000 growers.

In addition to the number of growers shown above, a number of payments will be made on behalf of share tenants and other participants. So that the number of individual payments will probably exceed the total shown above by 30,000. These figures are on the basis of our experience in the former sugar program.

Mr. TABER. Could you give us also a statement of the acreage that has been contracted for abandonment in each group, that is, beet sugar and the others, and the number of farmers with whom the contracts have been made, and the amount of the benefits?

Dr. BERNHARDT. We have no contracts and we won't be able to tell about that until we have gone into the field and checked on this. There is no way to tell that now. All we can say is that we know that there has been a freeze in the mainland cane area.

Mr. TABER. Can you give us some estimate along that line now? Dr. BERNHARDT. To be perfectly frank, no.

Mr. TABER. Didn't these growers make any applications in ad

vance?

Dr. BERNHARDT. No. Applications for payment cannot be made until the appropriation is made. We cannot invite any claims until the Government has appropriated funds.

Mr. TAYLOR. Until you have the money available?

Dr. BERNHARDT. Exactly. So that we have no possible basis for accurately calculating the abandonment or deficiency payments. Mr. TABER. What do you do? Do you give them credit for all the acreage that they didn't grow in sugar that they did the year before, or something of that kind?

Dr. BERNHARDT. No, sir. A form is prepared which has to be filled out by the grower, giving his acreage, yields, and other data. That is checked by the officials in the field at the factories to which the grower delivers his cane or beet. The factories have complete records of each grower over a period of years. Then from those calculations a check can be made on the grower's claim, supplemented by the inspection in the field.

All we can say at the present time is that we know that there has been a very serious freeze in Louisiana and Florida, which affected a great many of the producers there and reduced their crops, so that the provision of the act with reference to abandonment and deficiency payments, will be applied there, and elsewhere in less degree.

Mr. TABER. Have you any estimate of what that is going to be? Dr. BERNHARDT. We have no estimate that would be anything more than a guess. I would be glad to give you the best guess that I

can.

Mr. TABER. You must have made some kind of a guess to get these figures together?

Dr. BERNHARDT. Yes.

Mr. TABER. Give us the best kind of guess that you can. You can give that to us now, can't you?

Dr. BERNHARDT. Yes. I think that I can say that as of the date. that this tabulation was made, the abandonment and deficiency payments would equal approximately a million and one-half dollars, and that the deductions on large payments would be close to $3,000,000— $2,763,000 was the estimate-making a net difference after adjustments of $321,000, which appears in the table under the heading "Less Adjustments."

Mr. TAYLOR. Have you put in the record anywhere the total acreage in the continental United States of sugar beets and sugarcane? Dr. BERNHARDT. We will be glad to supply that for the record. (The statement referred to is as follows:)

United States Department of Agriculture Crop Report, December 1937

These estimates make no allowance for damage from freezes in late November and early December, since the extent of possible freeze damage cannot yet be determined.

United States Department of Agriculture Crop Report, December 1937-Continued SUGARCANE FOR SUGAR (IN SUGAR BELT)

1 These estimates make no allowance for damage from freezes in late November and early December, since the extent of possible freeze damage cannot yet be determined.

United States Department of Agriculture Crop Report, December 1937—Continued

* Includes some sugar manufactured from beet molasses which originated in other States. ? Does not include pulp disposed of in the form known as wet pulp.

148,000 47,000

Mг. TAYLOR. Have you given any place there the total consumption of sugar?

Dr. BERNHARDT. I have already stated for the record, in response to questions, what the estimated consumption is for 1938. In the regulations which we are submitting for the record in accordance with your request, Mr. Congressman, there is a table showing this year's quotas for each area. They are shown right in the regulations, which will also be submitted separately for the record.

(The statements referred to are as follows:)

1 Net quota after determination of deficiency. Under the Sugar Act, the deficit in supplies of any area may be allotted to other areas able to supply such deficit.

Mr. TABER. You tell us, Mr. Jump, that the figure here for the administration of the act and for the benefit payments under it does not in any way have any relation to the operations under the act in the Philippine Islands.

Mr. JUMP. That is correct.

Dr. BERNHARDT. That is as to operations relating to section 503 of the act for the Philippines.

Mr. TABER. Do the revenue figures that you have given us include estimated collections?

Mr. TAYLOR. You had better answer that "yes" or "no."

Dr. BERNHARDT. The $44,150,000 figure in the table does cover collections; the $53,000,000 represents accruals.

Mr. TABER. Are the tax collections, with reference to sugar produced in the Philippine Islands included in the estimates of gross tax collectible? Dr. BERNHARDT. Yes, sir. They are.