PRICES OF FLOUR SUBSTITUTES
Prices Of Flour Substitutes Debate In United States Senate, July 8th, On Necessity Of Regulating Charges Of Articles Used Instead Of Wheat By WILLIAM E. BORAH (Speech In United States Senate) A...
...President, I should like to say that I think the Senator from Washington is approximately correct in his statement...
...I pay 15 cents per hundred for grinding...
...Whatever reduction came at the time indicated, as can be clearly shown from the previous prices, came because the new wheat was coming on the market...
...Of course, the principal point that the writer of the letter was seeking to establish was the point of comparison between wheat and flour substitutes...
...It says: In looking over the Food Administration bill (H...
...REED...
...I feel the-Food Administratis will see the necessity of taking hold and dealing with it at once...
...By June, 1917, it had risen to 5.5 cents per pound...
...oatmeal, 10 cents per pound...
...I ask particularly the attention of those who have given consideration to the Food Administration law and its operation, for, if the power does not exist to deal with this situation, that power ought to be granted, and perhaps we could insert a clause in this bill which would remedy the situation...
...and barley flour, $8 a hundred...
...I suppose there is no exception to the fact that every year there has been a stiffening of prices at the end of the wheat year, which is approximately from the latter part of May to the middle of June, or even the 1st of July, the crop of wheat being largely exhausted...
...If the senator will pardon me for interrupting him just a little further, he may have noticed in the local newspapers in Washington city a schedule of prices, published as an advertisement by the Food Administration, in which they gave the wholesale prices for these substitute flours, and in a parallel column what they recommended as a reasonable retail price, 'and in the advertisement requested any customer or citizen to report to the Food Administration any greater charge or extortionate prices that retailers were receiving or demanding for these foods...
...Unless that course is adopted, we must necessarily have prevailing throughout the country such a condition as is indicated in these letters, greatly to the detriment of the producing classes and finally to the detriment of the consuming classes...
...This also appears in the fact that on May 21, 1918, the wholesale price of corn was 35 per cent higher than wheat flour...
...I thought that the Food Administration was not quite ingenuous with the farmers when it mocked them by saying, "Sell at any price you can get...
...If a price can be placed on wheat by the government, why is not a price placed by it on the substitutes...
...Until this is done,- what is there to prevent the substitutes from going still higher...
...I know that the Food Administration, or somebody connected with it, has answered the innumerable complaints throughout the county—I know there have been many of tham in the West and I assume, in other parts of the country—directed to the enormous prices of substitute flours recommended to be substituted for white flour, and complaints directed against speculation and profiteering in those food or bread substitutes...
...If the farmer registers a kick, the miller says, "That's government orders," and so he pays for the wheat at his own grade price...
...Again, what inducements are offered the farmer to raise wheat when he can see the advantages in raising substitutes, sell them at any price and at any time while the price of wheat is regulated, and he is unable even to sell it at all...
...rice flour, $15 a hundred...
...And not only that, but it is the worst sort of economy, for it obliges people to clutter up their shelves with stuff they do not want which means the wasteful use of it...
...BORAH (reading)— In July, 1914, the price of wheat flour was 3.2 cents per pound...
...President, I might read a great many other communications, and I have no doubt similar communications are coming to toher senators from different parts of the country...
...Absolutely none...
...There is exactly the same power to fix the price of the substitutes as there is to fix the price of wheat flour...
...The farmer has a large family...
...It should not be permitted longer to obtain...
...and it is going to result in a very large income from profiteering, which is indirectly aided by this method of doing business...
...I think that is true...
...A great majority of the American people are now making their greatest sacrifice in order to win the war for democracy, but a small minority is taking this self-sacrifice and patriotism as an occasion for self-enrichment...
...It is probable that this letter is correct upon the face of it, but perhaus the writer did not take into consideration the adulteration of flour as suggested by the Senator...
...Here is a case: Farmer Jones lives 25 miles from town—some farmers live further than that...
...it can control the duration of storage and the amount of profits on storage...
...they regularly bought and sold, and thus helped to create the very condition of which we have spoken...
...It is going to result necessarily in the decrease of the production of wheat...
...The miller screens it and grades it...
...The fact of the case is that the Food Administration, so far as I know, has not done anything more in regard to wheat than the Senator ffom Oklahoma can do...
...I have investigated the matter somewhat, and I entirely agree with the Senator from Idaho that while there is no specific authority to fix prices they have the same means by which they can control speculation and profiteering and extortioimte prices that they have as to wheat or any other food products which they control and regulate, and I think that is particularly £rue under section 5 of this act...
...I am satisfied myself, after examining the law, that the substitutes can be controlled, so far as prices are concerned, in'the same way and just as effectively as the price of wheat...
...He has full power...
...that they regularly bulled the market...
...I think the Food Administration has mocked the calamities of the farmer —the calamities which it has imposed upon him—by saying to the farmer, "If yon are not willing to take $2.20 for your wheat, or $1.95, or $2, you can sell to anybody that will buy and pay y°n more...
...but it can not fixe the price on wheat substitutes, either for producers or consumers...
...but the Food Administration has licensed all the wheat dealers in the United States and will—or would until recently— revoke the license of any wheat dealer in the United States who would pay one penny more for wheat than the price prescribed by the Food Administration...
...It can prevent hoarding, wastage, and speculation in these products...
...yet he could deal with the other situation, as I understand it precisely the same as he deals with wheat, if he desired to do so...
...It has all been "Hooverized...
...President, reading another paragraph from the letter, the writer says: There is another thing I desire to call your attention to, and that is this...
...he is informed by the miller that he must Vuy it at the store...
...With this I had to buy 50 pounds of substitutes at the following' prices: Klce...
...He can't help but ask himself why these things arc so...
...That international corner was created by the various governments, both our allies and the neutrals, reaching into our markets and buying vast quantities of grain...
...Prices Of Flour Substitutes Debate In United States Senate, July 8th, On Necessity Of Regulating Charges Of Articles Used Instead Of Wheat By WILLIAM E. BORAH (Speech In United States Senate) A S a basis for the remarks that I "> desire to make, I call attention to a letter which I have before me and which I have received from Mr...
...He has 500 bushels of wheat...
...Some one is now taking $25,000,000 a month from the American public by the sale of wheat substitutes...
...Now, I buy corn and get it ground at a little mill at Hartford, Kans...
...There is no prohibition in any regulation of the Food Administration against anybody selling his wheat at a less price or a higher price than that which the government will pay for it...
...Hoover, in his speech before the senate committee on agriculture, June 19, 1917, said that some one was taking $50,000,000 a month in excess profits from the American people by the sale of wheat flour...
...VARDAMAN...
...Reed Enters Debate MR...
...President, I entirely agree with tha Senator from Idaho in that respect...
...President, because of the fact that in buying 50 or 100 pounds of flour the purchaser is compelled, under the food-administration regulations, also to buy substitutes at these enormous prices— This is working a hardship on a grent many people...
...The flour that is being used now, every particle of it, is an adulterated flour, measured by the old standards...
...VARDAMAN...
...oat flakes, $8 a hundred...
...I do...
...I do not criticize the assumption of power at this time...
...Flour is $2.75, o»-5'/2 cents per pound, while the substitutes all are sold at 10 cents per pound—corn meal, 10 cents, barley flour 10 cents, etc...
...That is what I mean...
...POINDEXTER...
...I will add that I have taken it up a number of times with the Food Administration and urged them to take some action, and if I recollect clearly my correspondence with them, they stated to me that they had no authority to fix prices...
...A comparison with schedule prices will show that the poor people of this country are paying 6Yt cents per pound more on this article of food than it costs, or nearly 200 per cent above cost...
...This resolution speaks for itself and portrays a condition calling for consideration...
...I have received a large number of complaints from the S.tate of Washington, where the conditions are a good deal as they are in the State of Idaho, on the saw.e subject and I entertain the same views in regard to it that the Senator from Idaho has expressed...
...It is going to result in a great hardship, especially upon that class of people who are not able to pay exorbitant prices, the working people and similar classes of people...
...and it is as dear today, and in fact dearer today, than it ever was at this time of the year in the history of the world, when it is reduced to original flour—that is, the flour we formerly had...
...This letter is dated Preston Idaho, and is in part as follows: I desire to call your attention to the food conditions here in Preston, and I believe the same conditions exist in the other parts of this state...
...The substitutes are corn flour, $10 a hundred...
...Prior to June, 1917, the price of corn meal per pound was uniformly less than wheat flour...
...Which was that the bran, the shorts, and the middlings had been taken out...
...You may buy 50 pounds of flour and 50 pounds of substitutes at a time...
...The Senator has stated the proposition with precision...
...Have The Power AS I understand, Mr...
...Neither because of the control by the Food Administration nor, as a matter of fact, did the price go down...
...President, the Food Administration have the same power under the food-control act to fix the price of substitutes that they have to fix the price of the articles the price of which they are fixing...
...Whether or not they will be successful I do not know...
...The store, I presume, gets about 20 or 25 cents a sack for handling it—that is what they got before the war...
...This rise occurred in spite of the fact that the corn production in 1917 was five times as great as that of wheat, while the export trade was less than one-fifth as mueh...
...and, more than that it increases the price of the articles for which an artificial demand is created and raises the price of those articles to the people who do actually need them, who want them and desire to buv them...
...This makes it evident that we are now paying monopoly prices on wheat substitutes...
...Gore Gives Version MR...
...But who can pay it, and who will pay it when he knows that he can obtain it at the fixed price...
...and I have demonstrated time and again, in the statements that have been made in the Record, that one of the great causes for that increase in price was the purchases that were made by a committee controlled by Mr...
...President, I hnve received a number of letters similar to the letter read by the senator from Idaho, and I would not take the time of the senate to read any one of the letters received if it had not been for the fact that I have one here which makes the same complaint that is made by other writers...
...The farmer wishes flour...
...Bishop Merrill, who is a public-spirited man and a most active citizen of that part of the state, says: At present the wheat situation seems very unsatisfactory...
...POINDEXTER...
...oat flour, $10 a hundred...
...The supply of corn in proportion to demand appears to be very much greater than wheat...
...REED...
...I went to the store the other day to buy 50 pounds of flour, and here is what I paid: Flour, straight grade, $2.45 per 50 pounds...
...Our women declare that it is impossible to use 50 per cent substitute in bread, consequently part of the substitute must be fed to the animals or must go for mush...
...We believe that the public is entitled to the same control over wheat substitutes as over wheat, for otherwise the excess profits which have been lost on wheat will be recovered on wheat substitutes...
...As I lave said here before, personally I have no objection whatever to the attempt to control the price of wheat until the experiment shall have satisfied us all as to results, provided we undertake to control those things which enter into the production of wheat and those things which we are compelled to buy as substitutes for wheat...
...That has been...
...All the time the government is preaching conservation...
...CURTIS...
...Such a chaotic condition of affairs ought not to be permitted to obtain if there is any possible way to prevent it...
...By June, 1917 it had risen to 8 cents per pound, but, because of the control by the Food Administration, it fell to 5.2 cents per pound in May, 1918...
...and if the Food Administration feels that there is not sufficient power in the law now to deal with the situation, I for one should be glad to have that fact known, and during the long recess which we are now about to enjoy we might be able to find time enough to effectuate a change in the law...
...GORE...
...If these conditions continue, it looks to me as though all another year will go to raising those blessed substitutes...
...People are getting loaded up with substitutes, as it is almost impossible to eat them with the 50 pounds of flour...
...I only urge that, however the power is derived, it is as foil and complete to fix the price of these substitutes as it is to fix the price of the other articles or commodities...
...At present flour is selling here for $4.90 a hundred...
...I do not say that this power is conferred by the law, but, whether it is conferred or assumed, the same power ought to be exercised in relation to the price of substitutes as they have exercised in connection l^ith the price of other articles...
...is forced, further, to buy substitutes at exorbitant prices, etc...
...rye flour, 10 cents per pound...
...certainly not...
...He has to make this 50-mile trip every 10 days in order to keep in flour...
...but with that I am not going to quarrel, nor am I .noing to discuss it...
...I do not feel called upon particularly to come to their defense, but I think that they have accomplished a great deal of good and that they are not subject to the charge as made by the Senator from Oklahoma (Mr...
...One day out of 10 taken from his farm...
...VARDAMAN...
...REED...
...Why should the substitutes be so much higher...
...REED...
...When I say "pure flour" J mean pure in the sense of the term formerly employed...
...He pays $2.45 for flour and $5 for 50 pounds of substitute...
...He hauls his wheat 251 miles...
...You can not buy that kind of flour any more...
...We pl-#ce no limitation upon your receiving $3...
...And then the resolution continues some pertinent comments upon that class of people which I have no doubt are in harmony with the views of the senate, but are not relevant to the question of the comparison of prices with which we are now concerned...
...beans 15 cents per pound...
...it is a usurpation of power...
...VARDAMAN...
...President, will the Senator from Idaho permit me to ask a question of the Senator from Missouri...
...Of course, we are all loyal, but at the same time certain things can be carried too far, and I for one feel that this substitute business has gone far enough, and it is tira* now for the substitutes to eat a price placed on them, and that to be in regard to their true value...
...The farmer wishes flour to take home...
...That is, Mr...
...Calls Senate's Attention Iam calling this letter to the attention of the Senate, and through the Senate to the attention »f the Food Administration for the reason that it is going to work just such a condition of affairs throughout the country as the gentleman writing this letter indicates...
...He tries to dispose of it at the nearest siding, 8 miles away...
...President, from Bishop H. R. Merrill, of Preston, Idaho, from which I desire to read a single paragraph or two...
...The PRESIDING OFfTCER...
...Following the introduction of the the Food Administration the price of wheat flour dropped over 30 per cent, but that at corn meal increased 30 per cent...
...REED...
...is forced to sell it at a stipulated price at inconvenient places and under unfavorable conditions...
...I think the right word ought to be said in this immediate connection in justice to the Food Administration...
...Price of Substitutes MR...
...Its control over the price of wheat substitutes is only partial...
...A minority think that this is an opportunity for mulcting the public out of its hard-earned money...
...that is, offer a certain price which he will pay for wheat that he will buy...
...Then as soon as the new crop begins to come into the market—and that begins along in the month of June, but does not rise to any great height until about the month of July —that influx of new wheat immediately puts down the market price...
...What I submit to the Senator from Washington is this: Would there be any different reason why the Food Administrator should not control the price of substitutes the same as he does control the price of wheat...
...15 cents per pound...
...It all contains these grosser and coarser parts of the grain, which may be perfectly good for food, but they are not what we used to regard as the best kind of flour...
...Hoover...
...Does the Senator from Idaho yield to the Senator from Mississippi ? Mr...
...He keeps the bran and gives me 40 pounds of meal per busheL This makes the meal cost me 3/2 cents per pound...
...The farmer who raises wheat is forced to pay twice as much for the substitutes as he is able to get for his wheat, which is really worth twice as much as the inferior substitutes...
...Gore...
...The point which I desire to emphasize and accentuate is that certainly there should be a control of the price of substitutes if we are to control the price of flour...
...Certainly the farmer can sell to anybody who will pay more, upon the penalty of having their licenses forfeited...
...President, Vhat was that statement about "because of the control by the Food Administration ? " Mr...
...By June, 1917, it had risen to 8 cents per pound, but, because of the control by the food Administration, it fell to 5.2 cents per pound in May, 1918...
...Not only that, but the Government, through this administration, has been handling the entire wheat of the country —not merely the wheat desired for the allies, not merely the wheat desired for the armies, but wheat desired for the millers, except in certain exceptional cases—and generally speaking, the entire crop of 1917 was handled through licensed dealers, and they were forbidden, upon penalty of forfeiture of their licenses, to pay one penny more than the prescribed price...
...A producer of wheat is not allowed to eat all he wants of his own product...
...Do I understand the Senator from Missouri to say that there is no pure flour manufactured and sold now...
...by saying that they have no authority to fix a price...
...The writer overlooked another thing...
...President, my information is that the Food Administration gave out a statement perhaps in February or March last, that the reason the price was not fixed on the substitutes was that the food-control act did not confer that power upon the Food Administration...
...I intended a moment later to make some comment on the subject of which the Senator from Idaho is speaking, but I will defer that until he has finished...
...President, my understanding is that under the license clause of the Food Administration act they have taken possession of the wheat market entirely, and, while they have not directly asserted the power to fix the prices, they have indirectly accomplished the same thing...
...No one is buying wheat except the mill in town...
...I. B. Evans, a leading citizen of Preston, Idaho...
...But, now, eliminating that great international corner, which was bigger than any of those noted speculators, the price of grain and flour is today higher than it ever was at any similar period in our history, and that is where the gentleman who writes the letter is in error...
...true every year, but the point I make is that with the single exception of the wheat that was cornered, with the single exception of the great international corner in wheat which was worked just before the creation t>i the Food Ad ministration, there has been no real reduction in price...
...That is what the Food Administration has done in regard to wheat, .and that L sthe only price fixing which has been undertaken...
...GORE...
...I have here also a resolution, from a committee appointed by one of the county defense organizations, from Moscow, Iclaho...
...I insisted that they did have authority to control it and I believe that now they arc proceeding to undertake to control these prices and recently they have informed me that just as soon as the measures which they have taken begin to operate these prices will come down...
...In asking the public to buy breadstuffs on the 50-50 basis, the Food Administration is creating favorable conditions to make such a recovery possible...
...Has Many Letters HERE is another letter, Mr...
...It t,'kes about $8 cash to get 50 pounds of flour, or if a person wants 100 pounds of flour it will cost him $16...
...REED Mr...
...I do not understand that they have usurped any authority in the matter of fixing the price of wheat...
...Reading further from the resolution: Corn meal in July, 1914, was 3.1 cents per pound...
...President, the author of that communication had better correct his figures...
...There seems to be an impression throughout the country that the reason why the prices for substitutes are not controlled or fixed is that there is no power conferred upon the Food Administration to fix such prices, but if I am not in error—there is the same power to fix the price of the substitutes, as they are using to fix the price of other articles...
...That the wholesale dealers in wheat substitutes are now asking monopoly prices for their products is evident from the following observations: In July, 1914, the price of wheat flour was 3.2 cents per pound...
...R. 49G1) we find that the Food Administration has complete control only over wheat and wheat products...
...corn meal 9 ofcnts per pound...
...Mr...
...There is no power to do either...
...There should be no reason why he should not exercise whatever that power is, whether it is directly and properly exercised or not, or whether it is encompassed by a roundabout way or not...
...REED...
...The merchant says, "You may have a 50-pound sack of flour and 50 pounds of substitute...
...In May, 1918, it is 7.2 cents per pound in 25-pound bags, and 8.5 cents per pound in 10-pound bags, which is the only size the grocers in Moscow carry...
...The letter further discusses the situation, but the portion of the letter which I have read states the matter fully, and the same statement is coming to me in different ways from ail parts of the country...
...View of Poindexter MR...
...but in this "etter the writer gives the actual cost of corn meal, and I think the senate ought to be informed on the subject, so that they may know what profit is being made by those who sell com meal: My neighbors complain that in the new food schedule the prices charged for substitutes are excessive...
...Besides it would not be so bad to use substitutes if they could be bought for th«- same price as flour, but to pay twice as much for an inferior article at best makes a fellow feel as though there is something radically wrong...
Vol. 10 • July 1918 • No. 7
