Mr. BARTLETT. That is right.

Mr. LAIRD. I have never seen that type of procedure used in America before.

Mr. BARTLETT. I agree with you. I think that the amendments should stand on their own bottom and be voted in or out without affecting the main course of the Federal order.

Mr. LAIRD. Thank you very much.

Mr. BARTLETT. Now, Mr. Andresen, let us turn to exhibit No. 4. Maybe we will get into something that you are interested in. (Exhibit No. 4 is as follows:)

EXHIBIT IV

AMOUNT WHICH THE CLASS I PRICES IN SPECIFIC MARKETS EXCEEDED THE AVERAGE CLASS I PRICE IN CHICAGO AND MINNEAPOLIS-ST. PAUL, 1929 TO 1954

29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54

Mr. BARTLETT. The reason I gave Chicago so much attention is because in my humble opinion, that has been operating pretty much within the bounds and is pretty much free from trade barriers. Of course, in one way it may be it is tied to the fact that they would be called before the court if they did not keep within it. Whatever the cause is, they have added to producers and have subtracted them on their own volition and there is no restriction, so far as I know, about permitting grade A producers on the market.

Referring to exhibit No. 3, this exhibit shows the Federal order markets. I believe there are 12 Federal order markets shown here which has a population of 300,000 or over. I took the larger ones. Then, we compare the class 1 prices in each of these Federal order markets for each year 1929 to 1954, and the charts show here the

amount that each class 1 had in the way of prices in each of these markets, that it exceeded the average class 1 price in Chicago, Minneapolis, and St. Paul, 1929 to 1954.

In other words, taking the New Orleans market from 1929 to 1946. the class 1 price averaged 3 cents less than the Chicago-Minneapolis class 1 price.

In 1954 it averaged $2.13 above the average class 1 price of Chicago and Minneapolis.

In New York the average difference, class 1 price, exceeded Chicago-Minneapolis from 1929 to 1946, 91 cents a hundred pounds. In 1954, $2.16 per hundred pounds.

And in Philadelphia, 1929 to 1946, the average of class 1 was 42 cents above the Chicago-Minneapolis class 1. In 1954 it was $1.74.

In Boston, the average difference 1929 to 1946 was 79 cents. In 1954 it was $1.80.

I would like to go from here directly to exhibit No. 5 in which I have made a comparison, using this information with Chicago-New York. (Exhibit No. 5 is as follows:)

EXHIBIT V

COMPARISON OF CHANGES IN PER CAPITA MILK SALES IN CHICAGO AND NEW YORK

Per capita sales of milk in Chicago increased from 0.61 pint daily in 1940 to 0.82 pint daily in 1954 (figs. 1 and 2, and table 1). In 1954, per capita milk sales in Chicago were 6 percent above those in 1945.

Per capita sales of milk in New York increased from 0.75 pint daily in 1940 to a high of 0.92 pint daily in 1945 (fig. 1 and 3, and table 2). Since 1945, milk sales in New York declined 17 percent fo 0.76 pint daily in 1954.

Since New York's per capita milk sales in 1940 were materially higher than those in Chicago, and in 1954 somewhat lower, a logical question is: What have been the underlying reasons causing these changes?

Some of the factors causing these differences may be summarized as follows: 1. A slower rate of increase in per capita disposable income since 1945 in New York than in Chicago (fig. 4). In fact, since the depression of the 1930's the percent that per capita disposable income in New York was of that of the United States has been declining, while that in Chicago, Ill., has been increasing (fig. 5). This trend for both New York and Chicago corresponds to similar trends for the regions in which they are located (fig. 6).

2. A relative increase in store prices to consumers in New York as compared with those in Chicago. In 1925, the lowest report store prices to consumers in Chicago averaged 3.9 cents per quart higher than those in New York (fig. 7). By 1954, the lowest reported store prices in Chicago averaged 3.0 cents per quart less than those in New York.

(a) New York's class I prices in recent years much higher relatively than formerly: From 1929 to 1946, the New York Class I price averaged 91 cents per 100 pounds (2 cents a quart) above that of Chicago and Minneapolis-St. Paul. In 1954, New York's class I price averaged $2.16 (4.6 cents a quart) above those of the 2 midwest markets. This was an increase of 2.6 cents per quart, as compared with 1929-1946.

(b) New York has prohibited gallon jugs: 30 percent of all milk in Chicago is sold in gallon jugs at the present time. In 1950 only 13 percent of the milk in Chicago was sold in gallon lots; in 1954, 30 percent. Keen competition in Chicago in recent years has kept gallon prices lower than those for milk sold in quarts or half gallons.

(c) Half-gallon paper containers helped to increase milk sales in ChicagoNew York's use of half-gallon paper containers is negligible: The half-gallon paper container was introduced into the Chicago market in the summer of 1949.

1 An analysis of milk sales in the Chicago market between 1940 and 1952 indicated that average retail milk prices (adjusted) and per capita disposable income (adjusted) were the major factors affecting sales. The coefficient of multiple correlation for this period with per capita sales lagged 1 year as the dependent variable, and milk prices (adjusted) and disposable incomes (adjusted) as the independent variables, was 0.989. The standard error of estimate was 0.003.