Master Bob Arndt Chuck Frazier a

cup reach of the 1980 national farmers organization convention from Cincinnati Ohio and now here's the address by Vice President Robert our delegates officers and guests the 1980 national convention of the National Farmers Organization this convention is the first nationwide gathering of farm and ranch leaders in this country in this decade farm and ranch will ders who understand the need for profit and the know how to achieve that profit so that we can have a prosperous agriculture and rural America and stabilize our national economy the 1970s brought about a dramatic change in the development of technology and heavy capitalization of the agricultural industry a dramatic change that's going to continue into the 1980s of even more importance and this technology and the heavy capitalization of agriculture is a definite concern on the minds of those that recognize that food and fiber is of upmost important in this nation and throughout the entire world because of the changes that are taking place in agriculture we're going to see in the coming years a fanning out of a system that we've known for 150 years and the phasing in of a system that has not yet been tested a system that has been tried in countries and have failed and that is a system where outside capital is invested into an industry and hopefully that industry can sustain and maintain its efficiency as we've known in the past these are statements that have been made plans that have been made by those who hope to plan the destiny of you and I as farmers and ranchers in this country there was great concern in the Department of Agriculture because in industry with a annual sales of 200 billion dollars a year with a potential annual sales in a couple of years of four hundred billion dollars a year in a year makes that industry very tempting for those that have the ability to invest to invest into that industry and in the end on it and that industry is agriculture the industry that you and I have to maintain in the hands of private enterprise agriculture is the largest single industry in the world it has more influence in our national economy than any other industry in this country and we're in a revolution of change and the concern is great just industry has been recognized as a tremendous industry for the distribution of production and distribution of food we have the greatest distribution system in the world as far as getting the food from our farms to the tables of any individual in this country and we've got food left over for a large part of the world but there's a second distribution system that's been overlooked and it's been intentionally overlooked and that is the distribution of the money derived from the wealth that you and I produce and I ask you to just spend a few minutes with me because I think it's very important that we understand how this industry fits into our national picture how we affect the entire national economy that we can better understand our responsibilities as leaders of agriculture in this country I want to give you an example in 1979 the American farmer received 135 billion dollars for what he sold he sold that product and about 65% of parity now a lot of people don't understand parity but when you take all the fat out of it you boil it down what it amounts to is that your I in 1979 took $10 worth of our commodity to the marketplace and brought home sixty-five cents so many dollars worth for sixty-five cents it meant that we left 35 cents in the marketplace for every dollars worth that we took there because we paid for that commodity out of our pocket through our labors and the capital that we invested into it and those that buy our commodity were largely those people that had the money to invest corporations and corporate structures that took that product off our hands and they got our dollars worth of raw food and fiber a tenth of sixty five cents for it what did this do in 1979 to our national economy well if we had sold our commodity for the full fair price we should have received in the neighborhood of about two hundred billion dollars which is about sixty five billion dollars more than what we actually received and that was largely our net profit and we pay income tax and net profit and just a figure a flat figure of about thirty percent income tax paid on that sixty five billion dollars what have generated to our local state and national Treasuries about thirty billion dollars in income tax that we never seen twenty billion dollars that we'd never seen that twenty million dollars was never received by the local state and national government the Treasury's we would have had and should have had somewhere in the neighborhood of forty five forty six billion dollars left to spend of earned money that we gonna spend on Main Street that we never did because we never brought it back from the marketplace that twenty million dollars of income tax lost in one year where is that amount to in ten years a short span or economic system two hundred billion dollars that will never see how was that made up it's got to be made up by those either those in the laboring force by have paying a heavier share of their tax load or it has to be made up by borrowing money adding into the borrowed money that's going into the economy to add to inflation but you can see the tremendous industry the tremendous effect we have international economy that's why the concern is there when this industry begins to change what's going to happen to the production of food and fiber what's going to happen to our total economic picture the Department of Agriculture's responsibilities as they see it the main responsibility is to say to it that the agricultural industry of this country produces enough food and fiber for the consumers of this country and as cheaply as possible and still maintain the industry and their concern it was good enough that earlier this year late last year they decided to hold winnings across the country to get any sense of direction any sense of leadership and what they're going to be able to do so that we will have a sufficient supply of food in the next 20 years they he'll structure meanings and in these meetings the issues were made very clear number one technology is now available for rapid expansion and bigness and agriculture number two this technology and this rapid expansion has got to be paid for where is the money going to come from who is going to put the capital into agriculture and number three the question is asked can the corporate ownership those who have the holdings of billions of dollars of finances better utilize these this new technology and can they better finance the agricultural industry of the future than private ownership and ladies and gentlemen these are valid questions in the minds of those who develop programs who set the course of Agriculture based on the old marketing system because they have no knowledge and they have no ability to change that system so therefore they've got to base their decisions and their direction on a marketing system that exists today and one that has existed in the past a marketing system that is owned and controlled by those that have the power to invest those that are free from federal and government influence but those that have the ability to influence federal government decisions that's where we stand and if we want to remain dependent on federal programs in the federal government for their decisions to give us the direction that we're going to go we're going to find that we're going to be under the influence of those that have the capital the capital to invest and under the influence of those who have the power to influence those federal decisions and will be swelled up because those people that have the power to invest have their eye on the two to four hundred billion dollar industry of nut sales every year there's profits in it and they can see it agriculture has a tremendous influence on our economy but we have no influence to direct the decisions made by those that are making decisions today at the federal level so when you add it all up we can only conclude that the only way that we're going to be able to maintain this industry in the plant in the hands of the private enterprise system is to become free and independent from government programs from handouts that we've had in the past and have become free and independent from the influence of those that are buying our commodities in the marketplace and to do it it means that we must exchange or change the old marketing system and develop a better system in its place that has been it's going to be our goal for the future one that we will maintain and make no mistake about it that course is the course that we are on and we will not deviate from it it's very evident from the past that there is no government program there is no government agency there is no economist there are no farm groups or organizations or there are no corporate brain powers that have any idea how to better the system that we've had in the agricultural arena for the marketing of our commodities there has been no new ideas and if there are new ideas are checked off because those are the same people that want to keep the old system the way it is there are none except your organization for the national farmers organization structure of the nation wide collection dispatch engine every system that we've set up why do I say that because there are some very basic questions that pop up every time anyone else tries to change the old marketing system one of them is what will happen to supply and demand if we give the farmers everything they want well their percent of parity how will we keep that production coming from that firm and going into the system how can we shake it loose if the farmer gets all the money that he needs by selling half of his commodity these are valid questions what will happen to the cash flow where will it come from if we leave the private enterprise system intact as we've known it in the past what will happen when that industry has got to have an additional amount of income to buy the additional amount of money to keep operating the agricultural industry today is approximately a hundred and sixty million dollars in debt and by 1990 it's estimated that that 160 billion dollars is going to reach a trillion dollars where is that cash flow going to come from what will happen to exports if we change your old marketing system and we'll raise the prices to farm producers at a parity level when we be able to move our commodity into the world markets how will the consumer react are they going to accept higher prices for food at the table at the marketplace or at the retail level and if they react in a bad way are we going to be able to get re-elected to our positions the consumers make up 97% of the people in this country compared to 20% producers producing the food what will happen to inflation big question if we raise the price at the firm level what's going to happen to our inflation in this country how the processing industry get their supply of who changed the old marketing system these are questions that have got to be answered by those that are going to change the marketing system and replace an old system with a better one and there is no one that has that knowledge and ability except you and the National Farmers Organization the structure that you've put together what about supply and demand how can we as an organization correct or create a situation where there is no concern supply and demand is nothing more than putting onto the market what the market needs at a fair price and if there is anything left over take care of it by those that produced it it's in a membership agreement the program is spelled out we have it there we have a surplus disposal plan that we can use if it ever is necessary I don't believe it will be well for there is that concern of keeping supply and demand in balance keeping the product flowing from the producer to the consumer at a balanced level can be handled because of the plan that we've put together surplus disposal plan let's check off at the market level the processor level protect the certain excess from the market if it ever exists to change our marketing of raiment what the processors to increase or decrease the tonnage of commodity going to that processor for the certain price level these are things that can be done and will be done only when you and I his contracts with the processing industry for pasta production plus original profit and the marketing terms that we've got to have as producers it's a concern that no one can answer except this organization well the cash will come from to maintain the industry what does cash flow come from comes from this tale of that industry's production it comes from a perfect and that profit will not come about until you and I tap together the resources that we have only control back the commodity so that the industry cannot afford to turn it down after the contracts that we have to maintain to put in and maintain cross to production to put our marketing terms in those contracts and when you recognize and realize that the buying industry and the processors need our product just as bad as we need to sell it every day that's a reality what other group what other agency can create cash flow in agriculture through a profitable situation except the National Farmers Organization there is none and that's what we're all about the question of what will happen to exports exports will continue because you and I are the source of world food supply when you realize that we produce 60% of all the soybeans in the world 50% half of all the feed grains in the world will produce 30% of all the pork 25% of all the beef 17% of all the milk you've got to recognize that we are the source of world food supply and the prices that are set on our commodities reflect world market prices if we set the pace down here the world market price is going to be down here and it's going to be affecting every Western world country ever every country in the Western world if we set the prices up here that's where the world market price is going to float we will maintain our exports only at a profitable level where this nation will be able to benefit through their balance of trade and who has the guts to set the American farm prices at a level where it belongs you know there is no other we've heard so often that the consumer is going to have a bad reaction to the price of food the problem is is that no one has the ability number one to raise that price of food except this organization and number two the increase in the price of food is not what upsets the consuming the consumers in this country it's the fluctuation of the price of food the majority of the people of this country are in a position where they've got to budget their income they've got a budget to meet to make their house payments to make the car payments they're both payments or TV payments and whatever's left over they've got for food and that when an increase in price of food comes about it upsets them because they can't budget for food from fluctuates they don't know what the price of a loaf of bread is going to be ten months from now or even three weeks from now or a pound of steak or a pound of meat of any kind so they can't budget for food and when you go to the retailing industry and that's why the food prices are at this level they'll say this the reason why is because at the farm level we had a pay in this much two or three weeks from now and now it's reflecting at the retail level you can't pin them down so your food prices are fluctuating the only way that we're going to maintain and put stability in the food industry is for this organization to negotiate lower commodities under contract with the processing industry and those admire commodities for the price that when we fit cost of production plus a profit where these are prices up to that level and then stabilize those prices at that level for a long period of time at that point we won't know how much the producer of every commodity is receiving all the way along given period of time we know how much it takes to move that commodity from the farm to the processor we know what the processing costs are we know what the distribution costs are they're all fixed and once we fix our prices to a profitable level we then will have stabilized the food industry to a point that we can go to the retail change store and put a suggested retail price on every freedom because a fluctuation will be taken out of it and the consumer will benefit in knowing where he is linked from week and month to month once we raise that price level and then stabilize it will stabilize the entire food industry and it will be a benefit not only to this industry in agriculture but to the entire consuming people of this country and who can do that generally only you and I through this organization collective bargaining negotiating contracts with the industry inflation what about inflation we've been told so often that if we raise farm commodity prices it's going to create a situation of inflation in this country that won't stop don't you ever believe it because if Fair farm prices cause inflation we should have had no inflation since 1952 it's been only since 1952 that when farm prices began to drop the inflation began to heat up dry inflation is nothing more than a situation that happens from borrowing money throwing it out into the economy and not repaying that debt leaving the borrowed money out there if you and I were going to purchase an item that cost $1,000 and we had to borrow the thousand dollars to buy it and we'll put that thousand dollars of borrowed money out into the economy but didn't have the ability to repay it it stays out there but it doesn't just hang on a tree somebody's going to get it and there are only three major segments in our economy you've got a laborer you've got industry and agriculture now lumber is in a position to get their share of that thousand dollars they can call the strikes contracts with management but they're in a position to get their share of that borrowed money industry is in a position to get their share because all they've got to do is raise the prices of the commodities that they manufacture and put on the market agriculture is not in that position agriculture has got to pay for the higher labor costs that reflected the bio dollars that could throw it out there they've got to pay for the higher industrial costs but being that they don't have the ability to raise their prices what does agriculture have to do they borrow some more money and throw it out in the count in the economy the next time around and not having the ability to pay it back that borrowed money that agriculture is throwing out there is then being divided between labor and industry and you have another round of inflation and I'll define any economist politician to say that they can curb inflation without bringing the agricultural profit into the picture and bringing agriculture together with labor and industry at an equal level it can't happen so who can control inflation who can bring the inflation spiral to a halt and reverse it you and I to this organization through pre negotiated contracts with the buyers of our commodity that we can get the profits that we need to pay for the debt that we have but those borrow take those borrow dollars that we've got out there put it back into the shelves of the banks in the industry that loan them to us that those baauer dollars can be invested into new business and new industry that can hire new labor to earn the earn dollars that we've earned from the marketplace it's the only way that this national economy will ever turn itself around from its inflated situation it's a responsibility that rests heavy on our shoulders as producers of food and fiber that's a responsibility that is no greater than the ability that we have to correct it it's a comforting thought to know that we have a system now organized a structure put together well we can bring the farm commodities that are so important to us in our national economy in a position to cause the industry that buys them to pay a profitable price that one can maintain our industry we can create our own cash flow pay off debt and stabilize the entire national economy one of the concerns of the processing industry is how will they get their supply of food and fiber if the old marketing picture the old marketing structures beside any new structure in its place they have a real concern and it's a responsibility on our part as an organization to see to it that if we replace the old system with a new and better system the National wide collection dispatch and delivery system that for every contract we write for the places that we need we must fulfill the contracts with the production that we've learnt heed the processing industry once we have established but with the industry they'll accept the idea of contracting their supply through this organization the other concern and that it's our responsibility to see to it the that concern is met now this means that you and I through this organization are the only people who have the ability the resources and the knowledge to bring together a power bloc of people a power bloc of commodity and a power bloc of Finance so that we can effect and create and influence the processing industry and influence that political arena so that we can maintain a strong agriculture and bring a stability to the national economy that we have within this group you are the leadership in agriculture because you have that ability that no one else has it means that a team of farmers working together at all levels no matter what commodity is produced if we have that total vision of the total picture of what we can do on a national scale if we can catch that vision and then with your leadership go back home to your geographic areas in applying your leadership to your counties or to your township structures to develop the product and block them together to fit into the total scope the total national picture we will then have achieved the leadership at all levels and the ability to carry out every goal that we've set that's what this convention is all about to keep us divided it means that those that have profited from cheap raw materials in the past will continue to profit from those cheap raw materials and set the course of agriculture in this decade and that doesn't have to happen because you and I are each and independent part of a guide genic industry and together we make up the largest and most influential industry in the world and all we need to do is to bring together our thoughts or resources catch the vision of the total picture and we will have developed the most powerful industry that this country has ever seen and it will be in their hands of private enterprise and not the corporate power structures that we've seen developed in all the other segments well where are we as an organization tonight the president davon woodland is going to give the state of affairs address but I want to just point out a few basic things that has happening and what's come about in 1958 when we began organizing and putting together we organized under a philosophy in a theory that if we had enough people together and we got the people emotionalized heavy enough strong enough in a large enough area we will bring about change through the emotions of people were organized under that theory for 10 or 12 years to organize under in money motions alone lays a foundation of sand because those emotions never last were organized rapidly and hopes up the emotions of the people that we put together would create enough structure in an area so that the fast organizing that we done would create enough production going through a system that we didn't have then we could pay for the organizing after we done it or I didn't have the expertise we didn't have the knowledge of every step we had to make we done it by trial and error and we created a situation in this organization whereby we'll put together a tremendous powerful structure of people we had an idea of how we could move that production to the industry we don't have the expertise to do it with ourselves in a bad financial position we came out of it we paid for it out of wrong pocket you know how we pay that situation was changed about two years ago we recognize that we can't organize on emotions alone that we cannot gunshop our programs into all areas and hope to pay for them after the fact to recognize that we had to make a change within this organization in the thinking of how we're going to reach the goals that were after and the approach that we took came from the approach of emotionalizing people alone to the approach of becoming a organisation with a business sense and to do that we had to develop a department a budget department to know that monitor where we are from day to day how fast we can expand where we can spend our dollars and still keep the organization from getting deep into debt where we can't crawl out from underneath it to pay our way as we go along develop programs with reasonable goals to do that we had to make some tremendous changes we had to first of all get ourselves out of a depth situation as an organization and to do that we had to our staff and we made some deep cuts in oil commodities in nearly all areas unless take greater responsibility on the shoulders of those that were in the counties elected people because with fewer staff people out there assisting it meant that our elected leadership had to pick up that gap that was left and continued to build the programs that we had we've come through that phase over the past two years we've turned this organization around to where we've got the respect of the industry of the political arena and the financial world we now are in a position where we can build for growth and budget for growth but it's going to take a teamwork of the staff people that we have in the country and the teamwork of those staff Pia and the elected leadership and the membership in general because it's a total team effort farm producers across this country that's going to maintain over watch our goals one thing we want to keep in mind and that is that prices are set by those that have the power to set them and ladies and gentlemen make no mistake about it this organization intends to set the Pacers and have the power to set them when it came to be the source of markets in this country and to maintain those markets to pre-negotiated contracts what the industry that's a available and we will not deviate from that goal this going to be changes made and we would have to face the fact that we came from from an era of 20 years ago when we had somewhere between three and a half and four million producers smaller operators mixers that did not depend as heavily on Capitola as we are depending on it today today we have somewhere between six hundred thousand and eight hundred thousand producers in this country producing 80 percent of all the food and fiber their dependency and capital is much greater than it was 20 years ago and some of the direction grams that we need established have got to keep that in mind to keep our course on our very not deviate from it but if we have got to make small changes and even some major ones we need to look at it as an organization and look at it as a need so that we can continue on course and involve those who have had to change their farming operations from what it was 20 years ago we must be flexible not only in our bargaining we've got to be flexible in our thinking as an organization that's why this convention and those meetings and conventions that fellow are going to be so important that when we come to these conventions that's your input your knowledge your ability and your flexibility will help to set the course for agriculture in the future we have the no order of marketing and marketing established we've got the people in the agricultural industry we've got the leadership there right here we've got the production and we've got the finances among us we've got the ability to block huge blocks of production together to influence the processing industry to sit down and negotiate contracts with other terms in them we've accepted no grants we've accepted no handouts from government or industry we have no strings attached to anyone we paid for every step of building our structure out of our own pocket we are the largest industry in the world free to maneuver in any direction we want to take it because we've got the structure and the knowledge to take this food and favour that you and I are owners of the first owners and move it in any direction offer to any buyer under contracts that we write and we have the right to do all of this because of federal legislation the capper-volstead Act that was given to us 1922 and ladies and gentlemen when you think about that there is no group of producers and business or industry anywhere in this world that has that right and ability that you and I have that makes you and I the most influential people going into this decade is this coming decade and those that set the price of our firm commodities will be in control of this industry by the end of this decade if the corporate structure sets the price and continues to set that price and we let them by the end of this decade they're going to own and control agriculture there's no way of getting around it you and I and this convention will determine who's going to control agriculture in the 1980s and that determination can only come from the leadership that this organization has the only leadership meaningful leadership that agriculture has in this country so when you go tomorrow to the commodity meetings keep that in mind to pencil and tablet with you and when you sit down on these commodity meetings keep in mind that what you hear think about how it will apply to your area when you go back home