Labor, Unemployment Are Examined by Harvard, Stanford Economic Experts in New Issue of Business School Review

That agriculture in the United States, as well as in other countries, had developed a surplus of farmers, was reported today in the "Harvard Business Review" by Dr. Joseph S. Davis, Director of the Food Research Institute, Stanford University, and formerly Chief Economist of the Federal Farm Board. Dr. Davis presented an analysis of "Agriculture and the Nation's Business.

That the world needs fewer farmers is "one of the harsh facts of these postwar years" and one "which is usually too delicate to discuss," Dr. Davis said.

"There is no prospect that so large a farm population as we now have can earn a satisfactory living from agriculture," he added.

Trade Union and Public Relief

Abuses in trade union activities and public relief contribute two major barriers to the normal flow of farmers into industry, he said. The removal of such barriers is "of vital importance for the satisfactory functioning of our society and in particular for the solution of agricultural problems."

He mentioned "trade union limitation on entrance into trades and insistence on wage rates so high as to reduce wage incomes and overstimulate replacement of labor by machinery." Another factor, he said, is "a public relief system so operated that many can and do shy away from employment on terms that they do not like and lie down on the public rather than use their initiative and enterprise."

American Agriculture enjoyed relative prosperity during the period 1921-1929, and this was due largely to the fact that the number of farmers was decreasing about 5 per cent while the rest of the population increased by 14 per cent, Dr. Davis said.

"During the Great Depression, however, the farms became a refuge for many out of work, and the nine-year loss was soon more than recovered. As business improved, public policies of various kinds have helped to prevent another net reduction of the farm population, and the current estimate for January 1, 1938, is not far below the prewar peak of about 32,100,000.New Pressure Needed

He continued: "The basic reason why farm prices and incomes have averaged no higher, over a run of years, is that farmers' goods and services are available in larger quantities than people are willing to pay for at rates the farmer wants to get. Prices and incomes low in money terms are society's way of putting pressure on the weaker farmers to quit. If this form of pressure is lifted, some other form of pressure, here or elsewhere, must be exerted.

"When Congress sets the goals of farm prices and farm incomes at figures far above current economic normals, as it has done, it not only creates insoluble problems. It also forces the adoption of drastic measures certain to fall short of the goal, which in turn create fresh, complicated problems of solution. No one has yet seriously proposed that measures to regulate acreage, farming procedures, production, and marketing be reinforced by regulation of the entrance to and exit from farming, but these are logical further steps in the tightening web of regimentation."

Excessive goals are at the root of the United States' failure to reach workable solutions of genuine agricultural problems, and of the very multiplication of these problems themselves," he said.

"The present Administration is to be commended for a number of steps, including its vigorous attack on soil erosion, its intensive efforts to develop a constructive land policy, and its courageous attempts to open up international trade through reciprocal treaties