House Agriculture Committee members took their turns at the economic wailing wall yesterday, lamenting the plight of the American farmer, but were told by top federal financial officials that things are worse for other sectors of the U.S. economy.
The idea of the day-long hearing at the subcommittee on conservation, credit and rural development was to chastise the officials about high interest rates that have put much of the farm economy in turmoil.
There was plenty of chastisement, but from Federal Reserve Vice Chairman Frederick H. Schultz on down the witnesses left the subcommittee with the impression that, relatively speaking, farmers aren't suffering as badly as their subcommittee champions believe.
A typical complainer was Rep. Pat Roberts (R-Kan.), who said wheat farmers in his High Plains district have been "bled to the marrow of the bone over the last four years" by restrictive federal monetary policy. Now, he said, they are tiring of the administration's pleas for patience.
Schultz said that other industries -- housing and utilities, for example -- are suffering as much as or more than agriculture.
Schultz said that farmers, like others in interest-sensitive areas, have a serious problem with high interest rates but they are not "facing a significant problem with respect to credit availabiltiy." And, he added, recent surveys by the Fed indicate that farm loan rates are fluctuating sharply but staying a point or two below the prime rate in all but a sixth of the commercial banks that lend to agriculture.
"On the whole, our figures indicate that farm borrowers at banks have, on average, paid somewhat lower rates than most business when market rates of interests have risen to high levels," Schultz said.
Schultz stressed, much to subcommittee members' chagrin, that the Fed's restricted-money policies will continue as part of the overall effort to restrain inflation and bring down interest rates.
"By the end of this year, we will see the effects we need to see, and we will see inflation coming down," he predicted.
A similar message of hope and guarded optimism came from Donald E. Wilkinson, governor of the Farm Credit Administration, which oversees and regulates the cooperative farm credit system. He, too, stressed that more money is available generally to farmers this year than last.
The subcommittee listened sympathetically, but gave Frank W. Naylor Jr., undersecretary of Agriculture for small community and rural development, a hard time for the Farmers Home Administration's increased interest rates on loans to farmers and for its curtailment of last-resort credit for rural development.