Family Economics Review [Dec. 1959]

              ~11. 708: Oe.e. 59
/ For Buil ing Use Only / ;v
MICS
EW
Institute of Home Economics, Agricultural Research ·service_,
IJNITED STATES DEPARTMENT OF AGRICULTURE l"ii'if~~ffi
P.repared for home demonstraticn agents and home economics specialists of the
Agricultural Extension Service, this publication reports current developm~s
in family and food economics, and economic aspects of home management.
ANNUAL OUTWOK ISSUE
CONTENTS
NATIONAL ECONOMIC SITUATION AND OUTLOOK FOR l960...... ........... 3
THE AGRICULTURAL OUTLOOK. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
OUTLOOK FOR FOOD ................•......•..... ~ . . . . . . . . . . . . . . . . . . . l2
OUTLOOK FOR HOUSING AND EQUIPMENT................................ l4
CHANGING AMERICAN LIVING PATTERNS AND VALUES..................... l8
CONSUID:R PRICES .... ,. . . . • . . . . . . . . . . . . • . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
ESTIMATED COST OF ONE WEEK 1S FOOD................................ 26
ARs 62-5
December l959
•
Washington, D. C.
v
I
The articles making up this issue of
Family Economics Review are condensations
of talks given at the 37th Annual National
Agricultural Outlook Conference, held in
Washington, D. C., November 16-19, 1959.
I
NATIONAL ECONOMIC SITUATION AND OUTLOOK FOR 1960
Nathan M. Koffsky
Agricultural Marketing Service
The outlook for 1960 is for higher rates of economic activity and employ­ment
than those established just before the steel strike. 'Ibtal consumer
incomes, which in mid-1959 were 7 percent larger than a year earlier, may
increase another 4 or 5 percent by mid-1960. Even with continued substantial
growth in population and the prospects that consumer prices will average
slightly higher next year than this year, we expect per capita purchasing
power of the average consumer to increase further in 1960. As of midyear 1959,
per capita purchasing power averaged 5 percent above a year earlier, and more
than 20 percent above the level of 10 ye,ars ago.
From July on, the steel strike and its attendant effects brought some
reductions in industrial production and employment, and in the flow of income
in the economy. The overall declines were relatively small and most economic
indicators remained well above the levels of 1958. The strike had little
impact on consumer markets, particularly the demand for food.
Confidence generally remains high that the upward trend in the economy,
which got underway in the spring of 1958, will be resumed now that steel oper­ations
are rising. The outlook for 1960--particularly the first half of the
year--has been strengthened further by backlogs of demand built up during the
strike period.
Changes in the past year
Growth in the economy was fairly rapid to the middle of this year. Gross
national product in constant prices rose 10 percent between the second quarter
of 1958 and the second quarter of 1959, when it was 5 percent higher than the
peak rate attained before the recession in the fall of 1957· Reflecting the
slowdown caused by the steel strike, real gross national product in the third
quarter of 1959 declined between 1.5 and 2 percent from the second quarter.
Employment had risen to a new high in mid-1959. Despite a substantial increase
in the labor force, unemployment was less than 4 million persons, compared with
over 5 million in mid-1958. Employment, however, rose much less than economic
activity, reflecting a longer work week and a substantial improvement in pro­ductivity
per man hour. More recently, employment in some durable goods
industries has declined as supplies of steel were reduced. Nevertheless, in
September 1959 unemployment was 900,000 less than in September 1958.
The general price situation has been fairly stable over the past year.
The Bureau of Labor Statistics index of consumer prices and the Agricultural
Marketing Service index of prices paid by farmers for family living items
showed increases of about 1 percent over September 1958. Lower retail prices
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of foods partly offset price increases elsewhere. The persistent rise in
charges for services such as medical and personal care continued.
Between the second quarter of 1958 and the second quarter of 1959 the flow
of expenditures in the economy increased $50 billion. Consumer expenditures
rose 7 percent. Private investment outlays, where much of the 1957-58 reces­sion
was concentrated, rose almost 50 percent, accounting for almost half of
the total increase in expenditures in the economy. Government purchases of
goods and services--Federal, State, and local--increased some 7 percent.
In the most recent quarter, the decline associated with the steel dispute
has been largely reflected in the private investment sector. Government out­lays
and consumer expenditures have continued to rise~.
Item
Personal consumption expenditures
(Seasonally adjusted annual rates)
2nd 2nd 3rd
quarter quarter quarter
1958 1959 1959
Change
2nd 1958 2nd 1959
to to
2nd 1959 3rd 1959
Billions of dollars
Personal consumption expenditures 290.9 3ll.2 313.3 +20.3 + 2.1
Durable goods •.•...••.••••••••• 36.7 44.1 43.6 + 7.4 - 0.5
Nondurable goods •.•.••••.••••.• 141.5 147.7 148.0 + 6.2 + 0.3
Services ....................... 112.7 ll9.4 121.6 + 6.7 + 2.2
Consumer disposable income .•••••. 312.9 335·3 335.1 +22.4 - 0.2
Savi.ngs • .......•..•.............. 22.0 24.1 21.9 + 2.1 - 2.2
Personal savings rate .••.•••••••• 7.CJ1, 7·~ 6.5~ + .0.2~ - 0.7~
Source: U. S. Department of Commerce
The consumer sector shows broad strength, particularly for durable goods
for which second quarter expenditures rose 20 percent between 1958 and 1959·
Sales of appliances and furniture were up, reflecting a higher rate of new
housing completions. Sales of new automobiles have risen to a rate of over
6 million cars this year (including some 600, 000 foreign cars) • This compares
with about 4.5 million in 1958, but is still less than in 1955 when over 7 mil­lion
cars were purchased. Consumer spending for servi.ces has about kept pace
with the rise in consumer income. Expenditures for nondurables, especially
food, have not risen as fast. This reflects the lower level of food prices
this year.
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The increase in total consumer expenditures by the second quarter of this
year was about in line with the rise in consumer incomes (after taxes) • The
rise in consumer takings has also involved a sharp expansion in consumer credit
outstanding, not only for the purchase of automobiles but for other purposes
as well. Even so, with higher incomes the ratio of repayments on installment
credit to income has not changed materially for some years. While the ratio
of total consumer credit outstanding to income is somewhat higher than a year
ago, it still is not as high as 2 years ago.
In the most recent quarter, consumer expenditures--most notably for serv­i
ces--have continued to increase, although consumer incomes showed little
change. Accordingly, there was some reduction in the rate of personal savings
out of current income.
Mbst of the increase in private investment outlays up to mid-1959 and the
subsequent decline stem from sharp shifts in the business inventory situation.
In the second quarter of 1958, inventories were being reduced at a rate of
almost $6 billion a year. By the second quarter of 1959, inventories were
being accumulated at a rate of over $10 billion a year, partly due to the pros­pects
for a steel strike. With business sales up appreciably in 1959, stock­sales
ratios, particularly in durable goods industries, at the end of June
were substantially below a year earlier. There was a substantial gain also in
outlays for residential construction between the second quarter of 1958 and
the second quarter this year, involving large Federal purchases of mortgages
and more liberal credit terms for Federal Rousing Administration and Veterans
Administration loans. The rate of new housing starts rose from an annual rate
of about 1.0 million units to almost 1.4 million. Mbre recently housing starts
have eased off, though the September rate was still above a year earlier.
Business capital outlays for n€W ~quipment, which had declined sharply in
1957-58, rose 15 percent by mid-1959 and a further gain was noted in the third
q_uarter. However, sucl1 . · .tlays are still substantially below the level reached
2 years ago. ~iness ~ struction· has' not• changed much in t0tal.
In the government ' ctor, Federal purchases of goods and services at mid­year
were somewh£.~ larger than in mid-1958, primarily due to higher outlays
for National defense. Transfer payments--such as unemployment compensation-­are
ruming under a year ago as a result of improved employment. State and
local government payrolls continue to move up as employment and wage rates
increase.
Prospects for 1960
We turn now to the outlook for the period ahead, specifically for the next
12-15 months . Budget expenditures of the Federal Government in the current
fiscal year, according to the September Budget Review, are scheduled to be
below the fiscaJ year wh1ch ended June 30, 1959. Federal receipts have risen
sharply, reflectl..c:,,~ increased tax receipts generated by economic recovery. A
small budget surplud was projected for the current fiscal year, in contrast to
a substantial deficit incurred in 1958-59· State and local @PVernment expend­itures
are expected to continue to rise. The large increase of the past year
·----
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may not be matched, partly because of high interest rates and some slackening
in highway and school construction programs. Thus: total government expendi­tures
in the year ahead are likely to rise much less than in the past year.
We should not expect as large an increase in private investment expendi­tures
as in the past year, when there was a radical shift in the inventory
situation and a rapid increase in residential construction. With steel opera­tions
resumed, a substantial rate of inventory accumulation is likely for many
months, to rebuild stocks of steel and bring stocks in line with the level of
sales. The expansion of inventory build-up will likely be felt more 1n the
first half of 1960 than in the second half.
It seemBl likely that business capital outlays for new plant and equipnent
will continue to increase in 1960. Corporate profits have been reestablished
at a high level and rising sales have generated business optimism. Further,
we should keep in mind the investment-generating effects of heavy expenditures
for rese~ch and developnent by business. The tight steel supply, may, bo-w- ,-'
ever 1 cause some postponements. The prospects are not bright for farm capital
outl$1 inasmuch as farm income has moved lower. Residential construction,
which is fairly sensitive to high interest rates and a tightening in the avail­ability
of mortgage financing, will likely continue to ease off in 1960. Con­struction
costs have also increased.
Our transactions with foreign countries over the next year should provide
a plus factor for the economy. Foreign holdings of gold and dollar reserves
have improved sharply, some trade restrictions have been eased, and economic
growth abroad has been resumed. Although U. S. imports are likely to continue
to rise, exports may increase more than imports in the year ahead.
The consumer is likely to increase his expenditures. Higher outlays by
business and government will reinforce rising consumer dem~ds. Although the
economy may not g~- as fast in the next l2 months as in the past period, the
rate of growth will likely exceed the long-term rate of 3 percent or so a year.
Emplo;yment should increase faster than additions to. the labor force and unem­plo;
yment may be reduced further. Wage rates continue to move up. Next year
higher consumer incomes are likely to translate into higher purchasing power
again for the average consumer. The average price rise is likely to be small,
since somewhat lower food prices will temrto offset increases elsewhere.
Public reception of new car models has been generally good so far, and we may
expeft a further increase in sales of automobile and durable goods :next year.
This will likely involve some increase in consumer credit outstanding. Expend­itures
for services should rise about in line with the gain in income. Expend­itures
for nondurables, including food, may not rise as much as income in 1960 ·
But a favorable aspect for the longer run is that the heavy-eating teenage
group will be increasing faster in the next 5 years than any other age group.
According to the National Bureau of Economic Research, the e~ansion
phases of the postwar business cycles have run 3 years or more. If the cur­rent
expansion phase should confo_rm, the next critical period -would not be
until the spring of 1961. In view of the interruption to economic growth
occasioned by the steel strike, it might well be put off further.
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THE AGRICUill.URAL OUTlOOK FOR 1960
Frederick V. Waugh and Bushrod W. Allin, Agricultural Marketing Service
Faith Clark and Carl P. Reisig, Agricultural Research Service
Gustave BuT.meister, Foreign Agricultural Service
Last fall, we foresaw a slight drop in agricultural prices in 1959, a
small increase in prices paid by farmers, and a drop of from 5 to 10 percent
in net realized farm income. We forecast further increases in land values a.nd
in farm assets. And we said that consumers would benefit from ample food sup­plies
and from somewhat lower retail food prices.
These forecasts were substantially correct. But in the first 9 months of
1959, realized net farm income has averaged 15 percent below a year earlier.
Looking ahead to 1960, we now expect a further slight drop in average
prices received by farmers, a further slight rise in costs of farm production
and marketing, and a further drop in realized net farm income--not so big a
drop as occurred this year--perhaps about half as big. We expect ample food
supplies and a slight further drop in retail food prices.
Supply
Much of the time since World War II supplies have been so burdensome that
prices have not responded to favorable developn.ents in demand. Thus, the gen­eral
trend of agricultural prices has been downward, while there have been
upward trends in nonagricultural prices, consumer incomes, business invest­ments,
and in other factors that reflect a healthy, growing demand. Farm out­put
has risen faster than the market for farm products, resulting in lower
prices to the farmer, larger Gover:nmemt stocks of farm products and greater
cost to the taxpayer--but lower retail food prices to consumers.
The total output of farm products in 1959 is now expected to set another
record, slightly above the enormou.S output of 1958. Crop production apparently
about equals that of last year. Somewhat reduced yields are offset by the use
of some land that had been idle under the 1958 acreage -reserve program. Wheat
production this year is far below that of 1958, but cotton and corn production
are much larger. The output of livestock products is running ahead of last
year. The main increases are in bogs, broilers, and eggs. Cattle inventories
increased, but slaughter went down slightly.
Expansion of both domestic and foreign outlets for cotton may absorb this
year's increased output. Some increase in the wheat carryover seems likely,
and a substantial increase in the carryover of feed grains is practically cer­tain
. M::>st of these carryovers are held by the Commodity Credit Corporation.
As of August 31, CCC had $8.8 billion invested in price-supported commodities.
-8-
Our main problem is to keep supply and demand in balance in a way that
will provide an adequate income to efficient connnercial farmers. For the next
few years, at least, supplies of most farm products are likely to be ample.
Demand
Domestic demand was especially good in l959, as consumer incomes rose to
new highs, employment increased, and business conditions generally picked up.
It. should be even stronger in l960.
In addition to the ordinary market demand, Government programs pro.vide
domestic outlets for a considerable amount of foods. Our school lunch pro­grams
are now reaching l2 million children, our school milk programs 22 mil­lion
(including some of the l2 million getting school lunches) . Surplus foods
in the past year went to almost 7 million needy persons in institutions and
families. The main foods distributed through domestic food programs in the
past year were milk and other dairy products, corn meal, wheat flour, rice,
and dried eggs .
Agricultural exports in the fiscal year l959-60 are expected to reach
$4 billion, the third highest in history. Economic activity continues high in
the principal importing areas of the world, especially in Western Europe. The
dollar shortage has eased. Trade barriers are being reduced gradually. Ex­ports
of our surplus farm products are being promoted through Government pro­grams.
MOst of the expected increase of $300 million of agricultural exports
this year is due to anticipated higher exports of cotton.
Production and marketing costs
While prices of farm products have trended downward in recent years, most
other prices have continued to creep upward. The squeeze between low_er prices
to the farmer and higher costs of production an·d marketing has been an impor­tant
factor in the decline of realized net farm income.
Because of the substantial reduction in numbers of farms and farm people,
the decrease in per farm and per capita income has been much less than the
drop in aggregate farm income. Also, increased income from nonfarm sources
has been an offset to lower income from farming. During l959 the per capita
and per farm incomes of fann people from all sources declined from the high
levels of l958, while income of nonfarm people increased.
There are indications that the rise in farm costs may be tapering off.
The index of prices paid by farmers will average 2 percent' higher in l959 than
in l958. But the September l959 index was only l percent above that of
September l958, and slightly below the level of last spring.
Total expenses of fann production (price times quantity bought), however,
will probably rise still further in l960. So far in l959, production expenses
have been 3 percent more than in l958.
-9-
Costs of marketing have continued to inch upward. The marketing margin
fo r the farm food market basket in the third quarter of 1959 was slightly
higher than a year earlier. The farmer 1 s share of the consumer 1 s food dollar
in 1959 will average about 38 cents, compared to 40 cents in 1958.
Government programs
Government programs in 1960 will be about the same as in 1959.
Available funds will permit an expansion of about 5 million acres in the
Conservation Reserve next year.
Puplic Law 480 providing about the same assistance to farm exports as at
present has been extended for a 2-year period to December 31, 1961.
No major changes in price-support levels will occur during the coming
year . The minimum support price for wheat in 1960 has already been announced
at $1.77 a bushel, compared to $1.81 in 1959. The average support price for
the 1959 crop of corn in $1.12 per bushel and that for the 1960 crop will not
be much lower. The 1960 cotton program will be similar to that of 1959,
except for some differences in support levels. The incentive price for wool
at 62 cents per pound and support price of 70 cents per pound for mohair
announced for the 1960 marketing year are the same as those for the past
several years •
Farmers' prices and income
So far this year, agricultural prices have averaged about 3 percent below
those of a year earlier. The biggest declines have been in prices of hogs,
broilers, and eggs. Comparing the first 9 months of 1959 with the sam~ months
in 1958, hog prices were clown 27 percent, broilers down 16 percent, and eggs
down 19 percent. While hog prices may not drop further, they probably will
continue to be low throughout the coming winter and spring, at least. Cattle
prices may decline moderately with larger marketings next year. There is
likelihood of a small decline in the index of prices received. Since we ex­pect
a slight increase in prices paid, the prospect is that the parity ratio
Will decline a little more. In October it stood at 79·
In the first 9 months of 1959, realized net farm income has averaged 15
percent below a year earlier. The drop was due to (1) lower receipts from
farm marketings, (2) higher production costs, and (3) a substantial drop in
Soil Bank payments, resulting from the ellmination of the acreage reserve
program.
Next year we expect some drop in cash receipts from cattle and hogs (due
to lower average prices), and from wheat (due to this yearts smaller crop).
Cash receipts from most other crops may be about the same. Those from milk
and eggs may be a little higher than this year. We expect a further small
increase in total production expenses.
-10-
The outlook is for some further declines, both in agricultural prices and
in farm incomes. Present indications are that the drop in average prices of
farm products may be about the same as during the past year, and that realized
net income may decline about half as much as this year.
Farm assets
Fa.nnland Y&l.ues, f&nll assets, and rural levels of living have continued
to rise, in spite of declines in agricultural prices and farm income. Trends
in 1959 suggest that these increases may be tapering off.
The sharp rise in land prices of the past 5 years, which added nearly a
third to market values, may be approaching an end. The drop in farm income in
the last half of 1959, and the prospect for further decline in 1960, will re­move
some of the stimulus to the farmland market. The longer-range outlook is
also clouded by building-up of crop inventories, and by uncertainties as to
changes in farm legislation. Current interest rates and strong competition
for the available supply of mortgage credit may also postpone some purchases
of land, particularly if these conditions are viewed as temporary.
Partly offsetting these price-depressing factors are the continuing pres­sures
for enlargement of farms and the demand of farm operators for the limited
number of tracts of land that come on the market. The prospects of gains in
the general economy, continuing inflationary pressures, and the conversion of
farmland for nonfarm uses are likely to continue to support land prices in some
areas.
Consumers
Abundant food supplies which have been a boon to consumers in recent
years, will continue in 1960. Although food prices were record high in 1958
and near record in 1959, food expenditures have remained low relative to con­sumer
income.
Several recent developnents indicate that prices of consumer goods and
services 1 other than food, will continue to advance. The increase in the
Federal gasoline tax, already effective, will increase transportation costs.
If the settlement of the steel strike results in higher prices for steel,
prices for household eqtl1.pnent which use steel will also likely increase.
There is nothing to indicate that the long uptrend in charges for rent, m~di­cal
care, and other consumer services will be halted during the coming year.
Since only a small decline in retail food prices is anticipated during
the coming year, and indications are that prices for other important goods and
services will increase 1 it appears that overall family living expenditures
will be a little higher next year than this •
Farm familY; living
The long-term trends in the levels of living of farm people have been
upward, although at lower levels than those attained by nonfarm people.
Infant mortality, one indicator of family health status, dropped about
one-fourth in rural areas from 1948 to 1956. The drop in infant deaths was
accompanied by a rise in the proportion of babies born in hospitals. In 1956,
almost as large a proportion of babies born to rural mothers as to city mothers
arrived in hospitals.
Rural States still lag behind urban States in availability of physicians
to care for their people. The physician-population ratio is about half as
great in the most-rural as in the most-urban States, Voluntary health plans
are growing, and further growth is likely in the next few years ·.
A larger proportion of high school and college-age boys and girls from
f arms are in scmol than ever before. The proportion of farm residents who
are high school graduates is increasing rapidly. Farm people haven't caught
up with city people in education yet, but they are making good progress.
Between 1950 and 1956 the most-rural group of States increased their
spending for public schools slightly more, proportionately, than the most­urban
States. The most-rural group increased the per pupil amount for current
expenses of primary and secondary schools by about one-fourth; the most-urban
States increased it by one-fifth. In 1956, the most-rural group of States
was still spending only aboQt half as much ~r pupil for current expenses of
primary and secondary schools as the most-urban group.
The estimated value of rome furnishings per farm household in 1959 is
expected to be about 60 percent greater than in 1950 in dollars of constant
purchasing power. The increase in value of farm home furnishings reflects, in
part, the larger number of electrical appliances farm families have. Practi­cally
all farmers can use appliances now, because most farms are supplied with
central station electricity. According to the Bureau~;of the Census, 73 per­cent
of all farm homes now have one or more television sets compared with
3 percent in 1950.
Because nearly all farms now have electricity, there is only a small mar­gin
for further growth here. Few homes that are electrified are wi tbout the
major electrical appliances commonly associated with our American standard of
living. There is reason to believe that acquisitions of TV's, freezers, and
the Smaller items will continue, but at a slower rate due to lower incomes.
In 1958, according to estimates of the Agricultural Marketing Service,
60 percent of all farm homes bad telephones compared with 38 percent in 1950,
the year the REA telephone program was started. In 1960 and years immediately
following there will be a further increase in the number of farm mmes with
telephones. There will also be an improvement in service--such as modern dial
service, fewer homes on a party line, and single rings for each home; in fact,
all of the characteristics of urban telephone systems.
- - ----------
-12-
OUTIOOK FOR FOOD JN 1960
Harry Sherr
Agricultural Marketing Service
The overall food situation in prospect for next year is similar to that
for 1959· Supplies are expected to continue very large, and adequate to main­tain
civilian consumption of food in 1960 at about this year's per capita
rate. The rate in 1959 is estimated to be slightly higher than last year 1 and
3 percent above the average for the immediate postwar period (1947-49). Con ...
sumer income probably will be record large next year. This will likely be
reflected in the continuation of a strong demand for food.
Retail food prices are expected to average a little lower in 1960 than
this year. This will be mainly for the same reason as in 1959--lower prices
to farmers for several important food commodities, such as meat animals, which
will be in heavier supply. Food processing and marketing costs may be up a
little, partly offsetting the expected reduction in farm prices. In the pres­ent
year, the Bureau of Labor Statistics Consumer Price Index through
September averaged a little higher than in the same part of 1958, with the
decline in retail food prices almost offsetting the increase for consumer
nonfood goods and services •
The record high disposable personal income likely for next year points to
some increase over 1959 in consumer expenditures for goods and services . For
food this will reflect primarily the large population and increased purchases
of more expensive foods and more services with food, rather than more food per
person. On a per capita basis, food expenditures are expected to account for
somewhat more than a fifth of disposable personal income. This is about the
same proportion as estimated for 1959, and a little less than in 1958.
Food supplies are expected to continue large in the year ahead, close to
those of the present year. Food stocks will likely .be a little higher at the
end of 1959 than at the beginning. With average weather, production of food
crops will again be large in 1960. There probably will be more beef cattle
and calves on farms and ranches this January 1 than last1 but fewer dairy
cows and heifers. The rate of culling of dairy animals will likely be less
next year than in 19591 and milk output per cow at a record level. Marketings
of oogs in 1960 will be a little larger than in 1959·
Civilian per capita consumption of meat is expected to be a little higher
next year. The rate for the present year is estimated at 158.5 pounds. The
increase will likely be mostly in beef. Pork consumption may be up moderatelY
from 1959 in the first half of 1960, with the increase about offset by the
reduction in prospect for the second half. For beef, the prospective increase
over 1959 may tend to be concentrated in the last half of the year. The
increase would be in medium and lower grades of beef. Supplies of the better
grades of beef will continue about as plentiful as in 1959. Per capita con­sumption
of veal, lamb and mutton in 1960 may be up somewhat. Average retail
meat prices are expected to be down some from 1959.
---------- -
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A little more milk · and dairy products (in terms of total milk solids) will
be available in 1960 than this year. With the civilian population a little
larger, per capita consumption of milk and dairy products (on a total milk
solids basis) may be at the present year's rate. Civilians probably will use
about as much fluid woole milk and ice cream per person as this year, and
slightly more fluid skim milk products and cream mixtures. Declines are ex­pected
for butter and evaporated milk. Per capita consumption of evaporated
milk has been on the downtrend in the postwar period. This is due to several
factors, including a change in infant feeding practices and the increase during
the past decade in civilian use of nonfat dry milk, fluid whole milk, and "half
and half." Retail prices of milk and dairy products are expected to average
at least as high next year as in 1959.
Prospects are that there will be about as much poultry, meat (both chicken
and turkey), and eggs available next year as this. The postwar uptrend in
production of commercial broilers and turkeys may be restrained in 1960 by
low prices relative to production costs. Prices will likely be held down by
competition from red meats and by the fact that broiler production can be
increased very rapidly if prices rise. Fewer farm chickens will be marketed
next year for consumption because of reduced culling of the egg-laying flock.
Broilers provide 80 percent of the total chicken meat supply. Egg production
may be no greater than in 1959, at least until mid-1960.
Civilian consumption of chicken meat in 1960 is expected to be only a
little below this year's peak of 29.8 pounds • Consumption of turkey meat may
be the same as this year's record of 6 pounds • Per capita consumption of eggs
may be a little lower than in 1959, continuing the decline of recent years.
Retail prices of eggs and chickens are expected to average somewhat higher
than this year, those of turkeys about the same.
Record supplies of food fats and oils will be available in the year
ahead, according to present prospects:- The increase will reflect heavier out­put
of lard and vegetable oils. U. S. civilian consumption of food fats and
oils may total a little higher (in terms of oil equivalent) than in 1959,
though on a per capita basis it will be about the same. Retail prices of the
fats and oils food products will likely average lower than this year.
The supply of grains will be abundant in 1960. Civilian per capita con­sumption
of cereal food products probably will be about the same. Retail
prices of these foods are expected to average a little higher next year be­cause
of slightly higher processing and marketing costs.
Mbderatelymore processed-fruits and about as much processed vegetables
Will be available during the current marketing season. Supplies of dried
fruit will be close to the average of recent years, and much larger than last
year's low level. .Among the major fresh fruits, the main changes are re­flected
in larger supplies of oranges and smaller supplies of apples and tange­rines.
Supplies of grapefruit are about as large as a year ago. Production
indications for winter-season fresh vegetables are not yet available. How­ever,
with demand likely to continue strong, farmers will be encouraged to
Plant about as large an acreage to these crops as they did a year ago, if
-14-
weather at planting time penni ts . Weather also will be a dominant f'actor in­fluencing
the volume of' output. Supplies of' domestically produced f'resh vege­tables
this 'Winter 'Will be supplemented, as usual, by imports.
Potato supplies through 'Winter 1960 'Will be noticeably smaller than a
year earlier. Supplies are adequate enough, however, f'or civilians to consume
potatoes at the same per capita rate as in winter 1959. Potato prices this
winter are expected to average well above the very low prices of' early 1959.
~ f'ield ~ and the white varieties of' dry edible beans are in much
heavier supply and lower pr.i.ced this season than last. Crops were noticeably
larger this year than last.
OUTlOOK FOR HOUSING AND ~UIPMENT IN 1960
Ethel Hoover
U . S • Department of' Labor
Housing
Cost of' homeownership and rents.--The trend in costs of' both rental and
owner-occupied dwellings has been upward for some years . The Consumer Price
Index (CPI), which measures price changes for the same qualities from period
to period, shows that during the 2-year period from December 1956 to December
1958, rEnts increased 3.4 percent--1.9 percent the first year and 1.5 percent
the second. During 1959, there has been a very slight brake on the upward
movement, and the rise f'rom December 1958 to December 1959 will probably be
less than 1.5 percent.
The expectation f'or 1960 is that rents 'Will continue to increase moder­ately,
as costs to landlords go up. Rent levels are influenced by property
taxes and repair and maintenance costs, particularly when rental vacancies are
as scarce as at present.
About three-f'if'ths of' all dwellings are now occupied by homeo"Wners. Home­owners
in any urban group tend to spend more than renters, because they usually
invest in better housing. But if' equivalent size and quality are compared,
costs of' rentals and owner-occupied quarters are smut equal. y The increases
in homeowners' prices f'or the same quality, however, have been a bit larger in
recent years than for renters • The CPI measures changes in homeowners' prices
through purchase prices, maintenance and repair, mortgage interest rates, prop­erty
taxes, and hazard insurance. Prices for this bundle of' elements in home­owners
costs rose 4.6 percent in 1957 and 1958, as compared with 3.4 percent
y Riley, H. E. ''FedeJ;al wa,n Insurance and Housing Needs." I-t>nthly Labor
Review, Vol. 82, No. 4, p. 4o11 April 1959·
-15-
for rents, and they have continued up in 1959. Property taxes have been in­creasing
steadily as the cost for local services increases and as the needs
for a growing population must be met. Government supported mortgage rates have
advanced this year to 6-1/4 percent for a Federal Housing Administration loan
(including the 0.5 percent insurance premium as paid by the borrower) and
5-1/4 percent for Veterans Administration--the highest rates ever allowed in
t hese programs. It is expected that the mortgage interest rates will show
some additional increase by December 1959.
The average debt per home has also risen--from $3,7001 10 years aso~ to
$6,650 in 1959. This increase was partially the result of a larger portion of
t he home value being covered by loan in recent years (an average of 47 percent
now as compared with 37 percent 10 years ago for all owned homes, newly bought
as well as those bought earlier ?}) . There were also a number of other fac­t
ors, with the most important being the large proportion that newly built
homes were of all home purchases this year and the liberalization of mortgage
t erms . This liberalization took the form of lower down payments and longer
periods for repayment.
The average monthly payments for all housing purchases, including houses
just built and those previously occupied, have increased steadily each year
since 1950, according to the records for FHA mortgaged homes. (These payments
i nclude amounts applied on principle, interest, taxes, and insurance.) The
payments have been affected by increased purchase prices, ratio of the loan to
t he value of the dwelling, and longer time for repayment. However, while there
has been an increase in prices for houses, the payments still represent about
t he same proportion of income as they did several years ago (19.2 percent in
1956 and 20.4 percent in 1958).
There are, of course, certain characteristics of new homes that have im­proved
along with the rise in prices. The average size of new single family
homes insured by FHA increased from 858 square feet in 1950 to more than 11 000
in 1958. During the coming year, it is probable that the size of homes will
be about the same as this year. A greater amount of equipnent is provided now
t han in earlier years.
All of the factors contributing to housing expense have been rising in
cost in recent years, including materials, labor, and land. One of the most
s ignificant is the increase in land values 1 particularly in the metropolitan
areas. The increase in land values is indicated by the 11.3 percent increase
in 2 years --1957 and 1958--for purchases of existing FHA homes . Contrast this
With the 3.3 percent increase in overall construction costs in the same
2 years, as shown by Boeckh's index. 1/
The 1960 prospect for prices points to some moderate increases~ Building
materials rises are expected to average in the neighborhoo~ of 1 percent,
?} "1959 Survey of Consumer Finances, Housing of Nonfarm Families."
~ederal Reserve Bulletin, p. 1105, ~ber ~'59
jJ Residential Construction Cost Index for 20 Cities, E. H. Boeckh and
Associates.
-l6-
higher property taxes will undoubetdly be put into effect in some localities,
and other elements show little prospect of falling below l959 levels. However,
if builders cut average house size and some other quality factors, as happened
to some extent in l958 and l959, the average cost for new homes may show little
change from this year.
Housing supply.--Since l949, there have been more than a million units
added to the housing supply each year. For l959, estimates indicate that there
will be more than l.3 million housing units started, compared with l.2 million
in l95&. The rate of starts has been dropping during the last few months 1 and
is expected to continue to decline to the end of the year. This reflects the
mounting financing difficulties that began earlier in the year.
The supply of money for mortgages and the availability of low downpayment
financing have a significant effect on the rate of production and sale of new
dwellings. The financial angle is one of the problems in the housing outlook
at present. If interest rates continue upward in l960, the number of dwelling
units started could drop well below this year's rate of about l.3 million, but
will probably be above last year's total of l.2 million units.
The sustained high building rate has not resulted in a large increase in
vacancies. Vacant dwellings available for rent and sale are still in the
neighborhood of 3 percent of all units (as computed by the Bureau of Census),
indicating continued strength in demand for both rental and homeowner units .
Other signs point to a very active housing market in the future1 too. There
has been an increase in the rate of household formation due in part to the high
rate of employment and increases in income. More people--particularly single
people and elderly people--can afford places of their own. The increase in
these households has been counterbalancing to some extent the declining mar­riage
rate in recent years. But the marriage rate is expected to turn upward
in the rear future 1 as new families are formed from the large number of chil­dren
born during World War II. A further influence is the recent trend toward
larger families, particularly in the moderate and higher income groups.
Types of housing.--There is a strong recent swing toward greater emphasis
on the construction of multi-family structures containing rental units. In
metropolitan areas last year, 26 percent of all units built were of this type
as compared to l4 percent in l956. There has also been an increase in the pro­portion
of units built in the ci"ty as compared to suburbs. Last year, 36 per­cent
of all residential construction in metropolitan areas was in the cities
proper, as compared to 3l percent in l956. 1960 will probably see some further
rise in these proportions. The increase in importance of the apartment type
housing was probably due to a whole complex off actors, such as urban renewal
programs, the low rate of construction of such housing for a relatively long
period, and the demand by single people, elderly people, and small households.
Some of the prospective changes in materials for residential construction
are interesting. A marketing conference of 500 builders recently took a look
ahead for the next lO years, and hearq predictions of the use of prefinished
wall panels, machanically engineered to provide for heating, air conditioning
and lighting. They expect delivery of complete bathrooms to building sites,
-17-
ready-to-connect kitchens, and greater use of plastics and metals in home com­ponents.
Two companies are planning to manufacture foamed plastic panels with
skins of plywood, hardboard, aluminum, stainless steel and other materials.
Greater use of aluminum as a building material may be evident next year. The
country's largest prefab manufacturer has recently bought out a number of its
competitors, and prefabs may continue to account for a significant portion of
homes next year. The company's plans call for new models in aluminum, factory­finished
in luciteacrylite paint. Pilot models of homes featuring porcelain
enamel on steel are in the planning stage by a large steel company.
Household equipment
Mbst industry spokesmen give strong backing to the belief that the recovery
from the last recession stimulated a rise in the purchase of household durables.
Production and sales of furniture, appliances and other household durable goods
increased more than expected from the low levels of March 1958. By June 1959,
the Federal Reserve index of production of household durables had risen
35.6 percent. Production of furniture rose 32 percent, of major appliances
almost the same amount, and of radio and television sets nearly 68 percent.
Optimism is clouded by uncertainty regarding the effects of the steel
strike . Many producers of household goods had begun to feel the pinch of low
supplies by late September, and to reduce production and furlough workers • As
steel production is resumed, it will take from 4 to 12 weeks to attain "normal"
levels of steel supply and inventories. Iower production of durables made of
steel is fairly certain during the final quarter of 1959, and perhaps into
early 1960. Many feel that the strike will be only a temporary damper, and
that the upward trend will continue in 1960. The impact of the strike may be
ref~ected in increased prices of durables if steel prices increase.
Prices.--Retail prices of housefurnishings (including textile housefur­nishings
) declined 3.6 percent between mid-1953 and June 1959, while the ·"all
items" ConsUm.er Price Index rose 8. 7 percent. The decline in housefurnishings
prices was caused primarily by lower prices for household appliances (except
radio and TV) which dropped almost 20 percent. Prices nf textile housefur­nishings
decreased 4.3 percent. These declines were partially offset by sub­stantial
increases in prices of floor coverings and housewares. In September
1959 retail prices of furniture and bedding were at about the same levels as in
mid-1953·
The most significant factor in the steady decline in appliance prices was
the effect of changes in retail merchandising. Discount houses made consider­able.
inroads into the market, and competition for sales became .severe. In .
1955 some manufacturers reluctantly began to drop fair trade pricing, and other
manufacturers followed suit during the next few years. Although price compe­tition
is still a part of the retail appliance picture, it has lost many of its
"cutthroat" aspects. The result is that appliance prices have maintained rela­tive
stability during the past 2 years. Manufacturers and dealers have tended
to concentrate increasingly on competing for the consumer dollar by means of
new features and better service.
-18-
It appears that retail prices of bousefurnishings have ended the declines
that marked the first half of the decade. There is a strong possibility of a
slightly upward trend amounting to perhaps as much as 2 to 2.5 percent next
year. Although competition will tend to put a damper on price increases for
most household equipment it appears unlikely that higher costs affecting the
industry, especially at the producer level, will be fully absorbed.
The prospects for the passage of a Federal Fair Trade Act during the next
session of Congress are regarded as ranging from "poor" to "good." The enact­ment
of such legislation would put additional upward pressure on the retail
prices of housefurnishings, particularly housewares and small electrical appli­ances
which are currently being sold at prices far below manufacturer's list.
The amount of money consumers are willing to borrow to finance purchases
also plays an i.lnJ;K:>rtant part in the outlook for sales of household durables.
MOre consumers than ever before are using credit to buy furniture, appliances,
television sets, and other durables . Higher interest rates may cause a slowing
down of consumer borrowing, but it is doubtful that "tight" money, in itself,
will have a depressing affect so long as consumer confidence remains at current
high levels.
Product developments
From what has been done in the last few years, and from such information
as we have, I expect that changes this next year will not be radical changes in
present equipment or startlingly new products. They will most likely be alter­ations
in the equipment now available, such as in the technical makeup (changes
which often cannot be seen wi tbout taking the article apart), in style or
design, in the use of newer materials in place of the old, and in the addition
of special features.
I also expect to see a continuation of the trend in recent years to "up­grading"
purchases--that is, shifting gradually up the quality scale so that
yesterday's luxury item is today's standard but by tomorrow is obsolete.
CHANGING AMERICAN LIVING PATrERNS AND VAWES
Margaret G. Reid
Department of Economics, University of Chicago
Change and progress are main themes in our society. Probably never before
h.a.s there been so much stock-taking, so much looking back over the years to see
bow far we have come, and so much comparing of groups within our present soci­ety
to see where progress has been made and where lags have occurred. This
scrutiny has been accompanied by attempts to isolate conditions causing change,
-19-
to test notions as to what brings progress for some and not others. We want
to know what lies ahead and how to shape the future in order to maximize the
good things of life, to minimize the bad, and to avoid accidental disaster.
We have long been conscious of our greatly increased productivity and are now
debating the impact of the vast potential productive power that looms just
ahead with the development of nuclear power and other technological changes
that seem certain to occur. With the growth of productive power there has
come an increased recognition that such power is no more than a means to an
end, that it is valuable but not a sufficient condition for a good society.
To an increasing extent the basic issues of society are being reviewed. These
relate to people, how they live and how their living can be improved.
Increased production is meaningful only as it enlarges the stock of goods
t hat families have and improves their q_uali ty. On one thing there is no
doubt--the stock of consumer goods consumed has greatly increased. Families
are more abundantly fed, clothed and housed than they have ever been before.
Health services are of better q_uality and more generally availablej the average
number of years in school for children has increasedj and means of communica­t
ion, such .as the automobile, the telephone, and TV have widened the horizon
of the world in wliich families live. These changes have occurred in the North,
the South, the East, and the West, and for farm as well as nonfarm families.
In some ways, however, the transformation of the past fifty years has been
greater and some of it more recent for farm than for nonfarm families.
For some time progress of both urban and rural families has been measured
in terms of the availability of electric power and possession of things related
to it. Among nonfarm people, except in villages, this yardstick has lost its
usefulness because electric power and things closely associated with it are
now so universal. For farm families this limit is being approached.
The increase in real income and easier access to retail markets have had
an important effect on farm family living because they have reduced the effort
going to production of food for family consumption. However, the home garden
and milk from the familyf ann still seems important to high level nutrition of
farm families • For many families, if these things are not available from
their own farm their diets tend to lack needed nutrients. Until money income
of farm families is at a higher level or they are handier to retail markets,
the need for a garden and a cow continues to be important. This is an essen­tial
difference between farm and nonfarm families.
The two most coiliiilOnly used yardsticks of progress are increase in real
income and decrease in death rate. Over the past fifty years real income has
increased greatly and the death rate--especially that of children--has fallen.
The trend has tended to narrow the difference between farm and urban people.
In general, farm communities have always been considered healthier than urban.
In terms of life expectancy the farm population is still ahead.
In spite of the lower mortality of the rural population there is much
concern among rural people about an inadeq_uate supply of health facilities in
rural areas. Studies have shown that medical, dental, and hospital facilities
per 1, 000 of the population is less in rural than urban counties. Such
-20-
measures may be somewhat deceptive because of a tendency for such facilities
to concentrate in the large cities and for families to go to them there. How­ever,
studies show that farm families tend to use health services less than
nonfarm people even where there is little evidence of lesser need. For exampl~
the proportion of persons who have lost all permanent teeth is greater at all
ages for rural than urban people. There is also evidence that farm people get
less dental care than urban. The recent survey indicates that the farm popu­lation
has been availing itself of health insurance protection to a lesser
extent than the nonfarm population. Some of these differences may be related
to the relative level of money income of farm and nonfarm people, some to the
supply of services available, and some to a lag in customary ways of meeting
life situations. With the continued blending of the urban and rural communi­ties,
difference between urban and rural counties seems likely to narrow.
A third measure of progress ia the level of education. In this respect
the farm population has lagged far behind the nonfarm population, and dif­ference
among States for the farm population is great. This difference in
school attainment is one that is receiving a good deal of comment at the pres­ent
time, because of the increased awareness of various shortcomings of our
educational system in meeting the demand of the dawning nuclear era, and
increased awareness that economic opportunity for farm as well as the nonfarm
children lies in education.
The attainment of high-level education poses problems unique to rural
communities, especially to farm areas where children now attend so-called
country schools with one or two teachers. The decline in the farm population
has reduced the number of children in such schools and the ability to attract
highly qualified teachers. In addition, ideas about high-quality education
have changed. There seems little doubt that the reorganization of rural
schools is likely to receive a great deal of attention in the years just
ahead.
The consumption of farm families has changed, and their dependence on
market goods increased. But even more important has· been the change in their
general orientation, in bow they see the future for themselves and their chil­dren.
Improved means of communications have been great transformers of living
in the country in general. Their impact on the farm family has been especially
great because of their greater isolation before the coming of hard-surfaced
roads, the automobile, the telephone, the radio and TV. Horizons have been
extended and life has taken new forms. With greater ease of travel has come
the possibility of earning income in town and village for those wishing to
remain on the farm. Mlgration from farm to city has been occurring--for a
time at least it was akin to a flood tiae. Farm families more and more see
the continuity of life for themselves and their children not in the farm com­munity
where they or their grandfather settled, but in an area encompassing
the economy in general. To some people this change has entailed a loss--for
example, a loss of membership in a close-kllit group centered in their children
and grandchildren, in the school and church they first attended, and in the
count ry store they frequented where there were no strangers, at least not for
long.
,
-21-
While farm people sought economic opportunity in nonfarm occupations, the
proportion of the population on farms shrank and that of cities expanded. A
two -way flow occurred; hard-surfaced roads, automobiles and buses brought to
rural areas urban people whose main focus of life lay in a city. .Among these
are the so-called urban farmers, who operate a farm largely as a recreational
sideline or as a security against inflation. Thus, farm and urban living have
been merging not only in terms of kinds of goods purchased but also in face­to
-face contacts. The diversity of interests, attitudes and views represented
in many rural areas is now much greater than 2 decades ago. In many areas the
unification of this diversity into a rural commlinity is still in a very pre­liminary
stage. With good leadership a richer, fuller rur.al community should
emerge. It will be a blending more than ever before of farm and nonfarm
people. These rural communities will, however, probably be more amorphous
than those of 50 years ago. This seems assured by the wider range of contacts
and the relatively high mobility of members of the future rural population,
even those for whom agriculture is the main source of income.
In spite of the rise in real income, poverty still continues in both farm
and nonfarm population. Many inquiries have been undertaken to try to bring
to light its causes and conditions that would lead to its elimination, but
problems related to it are not easily solved·. They do, however, appear to be
more important for the farm thari for the nonfarm population. There seems
little doubt that some inequality will disappear with reduction in the isola­tion
that long bottled up some farm communities, with increased mobility as
families seek out better opportunities, with increased education, and with
reduction in artificial barriers to opportunities . The flow of the in-migrants
from Puerto Rico and Mexico has contributed much to the low-income groups of
both the farm and the nonfarm population. .America has, however, had long
experience with helping new immigrants to find a place. Th~ presence of such
low-income groups--low in our terms but not in terms of the economy from which
they have come--should hot be viewed as .a failure of our society to promote
economic opportunity. Failure will occur if the income of these recent in­migrants
does not improve. In fact, the rate of S)..lch improvement should:
p'robably be greater than that of the I'Otmlation in general.
Security of income as well as its adequacy has been a matter of much con­cern,
especially since the Great Depression. That experience brought home to
f arm people, as never before, the extent to which they are a part of the econ­omy,
that they can no longer provide for themselves the things they want, that
their possessions and way of life are dependent on the market price of their
products and the state of the economy in general. How to minimize the sharp
d:rops in income continues to be a matter of debate, and one of vi tal concern
to farm families. I do not believe that a lo'ngrun decline is likely so long
as real income in the economy in general tends to rise, and SQ long as off -farm
" economic opportunity continues.
Various programs designed to increase and stabilize farm income have been
tried and their suitability is still a matter of keen debate. An extensive
social security system has developed. At first it was applied solely to wage
and salary workers, but the trend has been to its greater coverage of the pop­Ulation.
In recent years Old Age and Survivors Insurance and disability
-22-
pro vis ions have been extended to farm operators as well as laborers . This
extension is still too recent to gauge how well this program is adapted to
farm families. The economic security of farm-operator families has long been
sought in the ownership of a farm and its operating capital. For this reason,
economic security is closely related to the financial institutions that make
agricultural credit available. This link seems likely to continue.
Increase in real income makes additional purchasing power available.
There has been concern about over-production--that people would not know what
to do with additional income. Some potential production will be sacrificed for
increased leisure. Such a tendency has been apparent among both farm and nonl4
farm people. Even so, there seems little shortage of ideas as to what and h::>w
consumption might be expanded. Hagood reports that "Farm-operator families
••. improved their levels of living significantly between 1950 and 1954." y
The 1954 farm-operator level of living index was 15 percent over that of 1950.
This rise from 1950 to 1954 was a continuation of the general improvement that
had been underway since 194o.
Family goals tend to be set a little beyond what currently seems feasible.
When income rises and this higher level is expected to be maintained; there
tends to be a corresponding increase in goals. In fact, some urban men claim
that their wives have next year's income spent before it becomes ·a reality.
Perhaps farm wives feel that their husbands have the increase spent before it
becomes a reality, so that any extra inflow of funds must go to liq_uidate a
farm debt, a mortgage on the farm or a loan for the purchase of farm eq_uip­ment.
I find some writers on family finance using the phrase "discretionary''
spending, seeming to imply that families now feel that they have more income
than they really need, something to play around with, to experiment with and
not feel too badly if the experiment does not pan out. I doubt very much that
the sense of having a surplus for experimentation is much greater now than
50 years ago--that too was a period of rising income. In the experience of
families variation does occur in the feeling of current surplus and stringency,
the ability at one time to splurge and the need at another to watch every
penny. These feelings are likely to be related to the ups and downs of income
from year to year--a condition common fo~ farm families--to change. in number
of dependents, and to the stage in paying off the mortgage. These conditions
bring no change in longrun family goals, such as tends to occur with above­average
attainment, or a rising national income due to increased .economic
opportunity. Thus it seems best for educators to assume that wise choice in
the use of income is a matter of continuing concern to families, that they
still do net want to pay any more than they have to for household eq_uipment,
clothes, and food. The feeling of the need for economy continues even though
most families are able and willing to spend more for consumer products • They
want higher q_uality, but do not want to pay more than necessary for it.
The world of farm and the nonfarm families as consumer.buyers is very
similar. In one respect at least, problems have greatly increased. Choice is
y Farm-operator Family Level of Living Indexes 1 1945, 1950 and 1954. U • S ·
Department of Agriculture, Stat. Bul. No. 204,p, l, March 1957•
-23-
much more difficult than formerly. Families are surfeited with alternatives.
New materials have replaced ol~, as in clothing and housefurnishing. A great
increase has occurred in the degree of processing, whereby household tasks
have, as it were, left the home and entered the factory. Wholly new products
have appeared}. Consumers find established cus~oms and traditions of little
help in evaluating these. Information as to the merits of the new products,
how to recognize quality, and how to use and care for them creates need for a
continuing program of consumer education. There is also need for the develop­ment
of grades and standards, to increase information available to consumers
at time of purchase and to evaluate performance of products.
Legislation to protect consumers from deception and misrepresentation has
come a long way, even though still imperfect. Ther.e is need for continued:'
sc·rutiny with respect to enforcement, the possibility of loopholes, the need
for adaptation to technological change, and the feasibility of additional
information on labels. In this the combined efforts of commodity specialists
and family economists are needed.
Misrepresentation of terms of credit sales and of consumer credit in gen­eral
is still a serious probl~ even though some progress has been made through
legislation . Financial tangles related to installment purchases are common.
Consumer education is an important means of dealing with this. It is difficult
through legislation to protect consumers who sign unread aoptracts, and who
contract fQture payments without a careful review of their future income and
other commitments.
Protection of consumers from sales pressure has made little or no ad­vance.
In fact, some people feel that the defenses of consumers have tended
to weaken. They point, for example, to mass communication through radio and
TV that reaches into every home, and to hidden persuaders by which people are
presumably influenced through their subconsc;lous. Protect ion of consumers
seems likely still to come from the boastings of many advertisers neutralizing
each other. However, more support to the Federal Trade Commission from con­sumers
should help to reduce the frequency of half-truths.
The sense of change and uncertainty as to what lies ahead, the need for
scrutiny of the economy and search for more effective rules to guide the vast
network of interrelations that make up the nation are felt by farm and nonfarm
people alike. Leaders in rural communities have a need for information and
revision of .perspective to see the best means of achieving the goals ~~ per­sonal
liberty and growth of individual persons, combined with recognition of
the rights of others.
Traditional programs are often insufficient to achieve our goals. The
current programs of the Department of Agriculture relating to poverty among
farm families gives full recognition of this. Here imagination as to the
development of persons seems of the utmost importance . In many other areas
a new look with insight and imagination is needed. In this period of change
you can take comfort in the fact that great achievement, as seen by later
generations, has often been accompanied by instability and much perplexity and
debate.
-24-
CONSUMER PRICES
Index of Prices Paid by Farmers for Commodities Used in Family Living
(1947-49 = 100)
November 1958; March 1959-November 1959
Item Nov. 'Marcn
April May June July Aug~ sept Oct.
1958 1959
All commodities ....•.....•.. 118 118 118 118 118 118 118 118 119
Food and tobacco.; •......• -- 115 -- -- 117 -- -- 115 --
Clothing .••.•..•.......... -- 114 -- -- 114 -- -- 116 --
Household operation ..••... -- 117 -- -- 117 -- -- 118 --
Household furnishings ..... -- 104 -- -- 104 -- -- 104 --
Building materials, house. -- 120 -- -- 121 -- -- 122 --
Auto and auto supplies •... -- 141 -- -- 141 -- -- 139 --
Source: U. S. Department of Agriculture, Agricultnrel Marketing Service.
Consumer Price Index for City Wage-Earner and Clerical-Worker Families
(1947-49 = 100)
October 1958; February 1959-0ctober 1959
Item Oct. Feb. March April May June July Aug. Sept
1958 1959
All items ...........•.•...•. 124 124 124 124 124 124 125 125 125
Food .••.•......•.......... 120 118 118 118 118 119 119 118 119
Apparel •• · •.•......•..•.... 107 107 107 107 107 107 loB loB 109
Housing ..•........•......• 128 128 129 129 129 129 129 129 130
Rent .................... 138 139 139 139 139 140 l4o 140 140
Gas and electricity ..•.. 118 118 118 118 119 119 120 120 122
Solid fuels and fuel oil 136 140 140 139 135 134 134 134 135
Housefurnishings •....... 103 104 104 104 104 104 104 104 104
Household operation ••... 132 133 134 134 134 134 134 135 135
Transportation ......•.•... 143 144 145 145 145 146 146 147 146
Medical care .•............ 147 149 149 150 150 151 151 151 152
Personal care .•.•.......•. 129 130 130 130 131 131 131 132 132
Reading and recreation •... 117 117 117 118 118 118 119 119 120
Other goods and services .. 127 127 127 128 128 129 131 131 132
Source: U. S. Department of Labor, Bureau of Labor Statistics.
Nov.
119
--
--
-- --
--
--
Oct.
126
118
109
130
l4o
122
136
104
135
148
152
132
120
132
-25-
PRICES PAID BY FARMERS
For Family Living
~OF 1947 - 49------------------------------------~
1954 1956 1958 1960
AMS OA TA , SELF.CTEO JT F. ~S, MARCH 19Sl· SEP TEM8 t::R 19Si'
U.S. DEPARTMEN1 OF AGRICULTURE NEG, 59 I 1 0) - 5 ~22 AC.RICULTURAL ltESEARCH SERVICE
CONSUMER PRICE INDEX
City Wage Earners and Clerical Workers
%OF 1947-49
1954 1956 1958 1960
U. S. DEPARTMENT OF AGRICUl:TURE NEG. Sf ( 10 )-562) AGRICULTURAL RESEARCH SERVICE
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ESTIMATED COST OF ONE WEEK'q FOOD
The table on opposite page presents the estimated cost of 1 week's food
to be prepared and served at home . The estimate is based on quantities of
food in the low cost, moderate cost, and liberal plans. The plans are avail­able
as a leaflet--Low Cost, MOderate Cost, and Liberal Family Food .Budgets,
HHE (Adm.)-113. The cost of food for a specific family can be estimated from
the table, since costs are given for individuals of different ages . These
costs are based on averages of food prices collected by the Bureau of Labor
Statistics in 46 cities, and may not apply to any specific city or region .
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Estimated Cost of One Week ' s Food, !/ October 1959--U.S .A. Average
Sex -age groups
Low-cost Moderate - Liberal
pl an cost pl an plan
Dol lars Dollars Dollars
FAMILIES
Family of t wo , 20- 34 years 2/ . ............ 1 5 .00 20 .80 23 . 30
Family of t wo, 55- 74) ye ars -2; . .......... . . 13 .60 18 .60 20 .80
Fami ly of f our, preschool children 3/ ..... 20 .60 27 70 31 .40
Famil y of four, school children~ .~ ...... 23 .80 32 . 30 36 . 50
INDIVIDUALS
Children :
Under l year ...... . ........... . .•....... 3 .10 3.80 4 .10
l-3 years ..................... . ......... 3 .70 4.70 5 . 30
4-6 years ........... . .. . ................ 4 .40 5 ·70 6 .70
7 -9 years ......... . .......... · · · · · · · · · · · 5 .20 6 .80 7.80
10-12 year s ..................•... · . · · · , · 6 .10 8 .20 9 . 30
Girl s , 1 3-15 years ... . .•...•........• . .... 6.40 8 .70 9 ·90
16-19 years ........ . .•............ · ... · · · 6 . 50 8 .70 .;.;·r· 9 .90
Boys , 13-15 years ......•.. . ............... 6 .90 9.60 10 .90
16-19 years ...•... . ... . .............•... 8 .20 11 .20 12 .60
Women:
20- 34 years . . .•.•...... . . . ............ . . 5.40 7 .60 8 . 50
35- 54 years ...... . ...................... 5 -30 7 -30 8.30
55 -74 years ................ . .....•....•. 5 -00 6 .90 7 .80
75 years and over .............. . ......... 4 .80 6 . 50 7 -30
Pregnant ...• . ... . ... . ... • ..•............ 6 .80 8 .90 9 .80
Nursing .......•.......•............ . .... 8 . 50 10 .90 12 .10
Men:
20- 34 years ....•....• . .. . ........•... · · . 7 .10 9 .70 10 .90
35- 54 years .... . .. . . . . . . . ............... 6 .60 9 .10 10 .10
55 -74 year s ........................ . .... 6 . 30 8 .60 9.50
75 year s and over ............•... . .•. . .. 6 .10 8 .20 9 .10
! / These estimates were computed from ~uantities in low-cost, moderate ­cost,
and liber al food plans publi shed in tabl es 2, 3, and 4 of the October
1957 issue of Family Economi cs Review . Quantities for children were revised
January 1959 to comply wi th the 1958 NRC Recommended Dietary Allowances . The
cost of t he fooq pl ans was first estimated by using t he average prices per
pound of each food group paid by nonfarm survey families at 3 selected income
levels . These prices were adjusted to current levels by use of Average Retail
Prices of Food in 46 Lar ge Cities Combined released periodically by the Bureau
of Labor Statistics . Estimates for food o~ · individuals and small families
have been rounded to nearest $0 .10 .
2/ Twenty percent added for smail families .
3/ Man and woman 20- 34 years; children, l-3 and 4-6 years.
~ Man and woman 20- 34 years ; children 7-9 and 10-12 years .
<t U.S. GOVE'!NMENT P RINTING OFFICE: 1959 0 - 533Z33