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FOOD MARKETING COSTS

TUESDAY, OCTOBER 8, 1957

HOUSE OF REPRESENTATIVES,
SUBCOMMITTEE ON CONSUMERS STUDY
OF THE COMMITTEE ON AGRICULTURE,

New York, N. Y. The subcommittee met at 10:30 a. m., pursuant to notice, in room 220, United States Customs House, New York, N. Y., Hon. Victor L. Anfuso (chairman of the subcommittee) presiding.

Present: Representatives Anfuso (presiding), Cooley (chairman of the full committee), Grant, Mrs. Knutson, Jennings, and McIntire.

Also present: Francis LeMay and Walter W. Wilcox, staff consultants, and John Heimburger, counsel.

Mr. ANFUSO (presiding). Will the committee come to order, please.

Ladies and gentlemen, in opening these hearings of the Consumers Study Subcommittee of the House Committee on Agriculture, in this city, we are grateful for the cooperation of Mayor Wagner and his Commissioner of Markets, Mr. Masciarelli, for their wholehearted cooperation, and to Mr. Lester Wolff for his unselfish contribution to the work of this committee.

It is needless for me to say that New York City is my hometown and I am sure that no one would mind if I am a little bit partial toward it.

Before I introduce the very distinguished body of lawmakers at this table, and before the taking of any testimony, let me give you a little history of the Consumers Subcommittee. It was created only a few months ago by the distinguished chairman of the Committee on

riculture, Hon. Harold D. Cooley, who traveled all night to be here to attend this meeting.

I was given the honor to head this subcommittee. It is composed of 4 Democrats and 3 Republicans. One distinguishing feature of this committee and I should like to relate it to you—is that we set out from the very beginning to seek the problems facing the committee, not as Democrats or Republicans, but as Americans placing the security and well-being of our country foremost. As a result, all of our decisions, all of our reports thus far, have been unanimous.

Part of our job today and tomorrow is to receive testimony showing the spread between what the farmer gets and what the consumer pays for food products.

Last evening the committee and its staff, together with Commissioner Masciarelli, and others, visited the New York produce market at the highest point in its activities and learned a great deal which will be helpful to the committee and the Congress in recommending and passing new legislation beneficial to the people of the city of New

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York. I am sure that our chairman, Hon. Harold Cooley, who introduced a long time ago a marketing bill, will have something to say about it. And if he had seen the conditions that we observed last night, he could not help but feel that conditions here in New York City for marketing are horrible, a total mess—not the responsibility of the public officials because I know they have been trying time and time again to do something about the problem. But the consumer is paying a great deal more than she should because there are so many unnecessary steps taken before the product gets to her, that if they were removed the cost would come down appreciably.

We found out last night that in a short space of 5 blocks from the terminal to the market a truck is unloaded and reloaded sometimes 2 or 3 times, all at an expense, I understand that costs about $250,000 a day and if that could be eliminated you can calculate for yourself what the tremendous savings would be to the consumer. Prior to this hearing and prior to last evening and, more particu

, larly, from September 20 to September 30, I went throughout the State at my own expense to study the problems facing the farmers and consumers of New York City. I mention that in the presence here of my colleagues at a time when Congress is adjourned to prove that a Congressman's job is today a full-time one and not a part-time job as it was years ago.

For the benefit of the witnesses who will testify in future hearings in Washington and throughout the country, let me tell you what we are aiming for. This is a constructive study. The Committee on Agriculture today has the power of subpena, obtained through the efforts of our distinguished chairman. We have not used it yet. We do not intend to use it unless we have to. We are not looking for headlines.

As I said last night at the dinner which was given to the committee, we are looking for cooperation on the part of all people that have something to do with the food industry. If we get the kind of cooperation that we expect I am sure that all will be happy.

First of all I want to categorically state as to the studies that we have already made that the farmer is not at all responsible for the increased cost of living. Of that we are sure. If anything, he has not shared equally with all of the other distributing factors making up the cost. As a matter of fact, he has been shortchanged because of a lack of bargaining power and understanding to the point where it is difficult for him to make both ends meet. Remember, that the farmer is a consumer, too, and if he cannot buy what we in the cities produce, industry suffers. So it is a two-way street, no matter what side you

Remember, too, that the last depression started with a lack of buying power, farm mortgage foreclosures, and so forth. Let us not hare it happen again. No one can say that the United States is beyond that. There is not so much in the prosperity of America that all may take something out at any time and have something left. Capital, industry, and labor have great challenges facing them. They cannot afford to fight each other. They must work together to stabilize our economy and prevent inflation. We must stop prices from going higher and higher, or our dollar will become as depreciated or as valueless as the French franc.

What good is it to be paid in large figures if those dollars can buy so little?

are on.

And may I conclude my opening remarks, ladies and gentlemen, by saying to you, that business and labor and industry in our system of private and independent initiative has been responsible for many new inventions beneficial to mankind. This system, however, is now being challenged by a power which has enlisted all individuals under its domination to work not privately, as we do, or independently, but for the so-called state.

Can the free world survive such challenge, let alone advance as we did before, with this powerful enemy breathing down our necks unless we all tighten our belts and sacrifice a little ?

Now let me introduce the very distinguished panel of lawmakers who have come so far and wide to be here at these New York City hearings.

On my right is Mrs. Coya Knutson, of Minnesota; next is Mr. George Grant, of Alabama; on my left, Mr. Pat Jennings, of Virginia; Mr. Cliff McIntire, of Maine; and our distinguished chairman, Mr. Harold Cooley, of North Carolina.

Now, as the first order of business, I am going to recognize a very distinguished lady in our State who has done a great deal on behalf of the consumers of New York State, whom Governor Harriman saw fit to appoint as the consumers' counsel and a member of his cabinet, who is here as she has been throughout the State studying consumer problems. Only yesterday, at a luncheon with Governor Harriman, ħe and I at his home discussed the problems facing the farmers of New York State. I assure you, ladies and gentlemen, that the Governor of this State and the mayor of this city are both vitally interested in consumer problems. May I ask this very charming lady, Dr. Persia Campbell, if she will be so good as to introduce the three charming ladies she has brought here who have performed a mission on behalf of her committee.

STATEMENT OF DR. PERSIA CAMPBELL, GOVERNOR'S CONSUMERS'

COUNSEL, NEW YORK STATE

Dr. PERSIA CAMPBELL. Congressman Anfuso, Mr. Cooley, and members of the Consumers Subcommittee on Agriculture.

As you requested, I asked the ladies to buy some food in different types of stores, primarily produce foods. They will give you the prices they paid on a comparative basis in a few of the different stores. They will explain several of the problems the consumers have in the quality of it and of the price today. I am sure they will answer such questions as they can about the current shopping situation.

May I present Mrs. S. Werbell of the Henry Street Settlement, on problems of the lower income group. Mrs. Walton Pryor who is chairman of the Consumers Protective Committee, and Mrs. R. D. Persinger, representative of the YWCA who has helped in the middle income group. I am sure you will be interested in asking them questions. Mr. Anruso. Thank you, Dr. Campbell. Not only have you

. brought us very charming ladies, but very representative ladies, judging from the organizations which they represent.

Mrs. Werbell, may I ask you to tell us something about the basket that you brought here?

STATEMENTS OF MRS. S. WERBELL, HENRY STREET SETTLEMENT;

MRS. WALTON PRYOR, CONSUMERS PROTECTIVE COMMITTEE; AND MRS. R. D. PERSINGER, YWCA

Mrs. WERBELL. Since I represent the members of the Henry Street Settlement, most of our families live out.

Mr. ANFUSO. Pardon me, I have heard so much about the Henry Street Settlement, but I am sure many of these people have not. Will you please tell us something about it?

Mrs. WERBELL. It is an organization on the lower East Side of Manhattan. We represent families of low-income groups and large families; we have mothers who come and meet and talk about their problems.

We have clubs for children, teen-agers, small children, a nursery school, where the families in the neighborhood keep their little ones. There are some things we have a personnel service where people come with housing problems and problems of illness. All of this is done at Henry Street but with a very small staff-a very efficient one.

So I decided to shop in the neighborhood where most of our people who belong to the settlement shop, and I shopped in the neighborhood supermarket.

I found there that sometimes the prices do not mean that we are getting the quality we should. For instance, we bought a pound of snap beans. I paid 19 cents a pound. They are not as nice as some the other shopper housewives received in the other neighborhoods.

We bought a head of lettuce. I paid 29 cents for it. That was not as fresh as you could want. At one time it was 10 cents a head.

Then I paid for a bunch of carrots. Because they have the tops on they were 19 cents.

These small oranges were 6 cents each; the large ones 8 cents. If they want fresh orange juice they find it very difficult at these prices.

Å quart of milk in one store was 26 cents. These ladies in one store paid 27 cents, and in another store 28 cents for the same homogenized carton.

Then eggs—I bought eggs for 30 cents. One lady bought them for 40 cents. I am talking about a half dozen.

Mrs. PRYOR. I paid 41 cents.

Mrs. WERBELL. That was for half a dozen. There is all of that difference in prices.

On apples we bought McIntosh from New York and for those I paid 15 cents a pound. McIntosh apples that came from Massachusetts are a bit nicer, and there is a McIntosh used for cooking. There were other apples for 29 cents a pound.

Broccoli, for instance, was 23 cents a bunch. And so I found that the produce on this little table here for, perhaps, a family of 2 children and a father and a mother for 2 days cost $5.68. That was the amount of it.

Mr. ANFUSO. Mr. Ogren, could you tell us, please, what farmers get for some of these products that have been mentioned here by Mrs. Werbell ?

Mr. KENNETH E. OGREN (Agricultural Marketing Service, U. S. Department of Agriculture). I could give you some of them.

Mrs. WERBELL. Snap beans, 25 cents a pound.

Mr. OGREN. The United States farmer in mid-September received an average of 7.9 cents. This would be an average of beans sold all around the country.

Mrs. WERBELL. The head of lettuce there was 23 cents and 29 cents.
Mr. ANFUSO. Who paid 23 cents?
Mrs. WERBELL. I paid 23.
Mr. ANFUSO. And Mrs. Pryor?
Mrs. PRYOR. 33.
Mr. ANFUSO. You paid 29 ?
Mrs. PERSINGER. Yes.

Mrs. WERBELL. This one and that one. There is very little comparison.

Mrs. PERSINGER. This was a very firm head. This is the one I bought.

Mr. ANFUSO. What is the difference in price?
Mrs. WERBELL. Six cents.

Mr. Anfuso. For the larger one you paid less. Which is the larger one?

Mrs. WERBELL. This one.
Mr. MCINTIRE. The firm head had the greater weight.

Mr. ANFUSO. Mrs. Pryor, would you stay where you are. You are chairman of the Consumers Protective Committee of New York City, are you not?

Mrs. PRYOR. Yes. Mr. ANFUSO. And Mrs. Persinger, you are connected with the YWCA?

Mrs. PERSINGER. Yes.

Mr. ANFUSO. Thank you very much. Do you wish to compare any other prices? What is the farm price on lettuce?

Mr. OGREN. Mid-September $4.25 a hundred.
Mr. MCINTIRE. How much do they weigh?
Mr. ANFUSO. What is the weight of these? Less than a pound?
Mrs. WERBELL. Less than a pound.
Mr. ANFUSO. You paid four point what?
Mr. OGREN. 4.2 cents a pound.

Mr. Anfuso. These are less than a pound and they sold for 23 and 29?

Mrs. WERBELL. This may be a pound. This may be about half a pound.

Mr. ANFUSO. One is half pound and the other three-quarters of a pound. All right. Do we have any other comments ?

Mr. Max FISHER (Associated Food Stores). The prices in September are true, but you must not forget that you had a lot of locally grown lettuce and the price is a whole lot lower. You do not have as much locally grown lettuce today as we had in mid-September. The same with the snap beans. Beans were coming from the New Jersey area, a local area. And right now we are right in between.

We have had a lot of rain down in the Eastern Shore and no beans are coming from Florida. That is why they are higher today than this mid-September.

Mr. ANFUSO. What are you paying for lettuce now?

Mr. FISHER. On the top quality it is 41/4—top quality. Some inferior kinds about 31/2

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