' THE TABOR CITY TKlr Farm Income Drop! For 1947 Imminent Recent information on the eco-1 nomic situation which is expected | io prevail during 1947 indicates that! farm people should begin planning to economize in production costs if thr>y do not want to come out in the υ Ν Κ red next year. It is expected that labor costs in general will be higher during 1947 t'.»an during any pre vious year. However, farm products are expected to sell at lower prices than in 1946. Farm income is ex pected to be about fifteen percent less than in 1946. Nearly all farmers have had sub stantial earnings during recent suit of the war-increased demand years. This has been mainly a re and rising prices for farm products. Not recognizing this, many farmers take personal credit for their finan ; cial success. When the bubble of false prosperity finally bursts, a large ! number of those farmers will sud denly face trouble that is serious. ; if not fatal. Three major perils beset the artifi cial prosperity of 1946; the rise of inefficiency; the assumption that high prices will continue; and the difficulty of adjusting to past-infla tion "normal", ι The margin of profit in most lines of business was wide during the war. Farming was no exception. Farm prices doubled from 1939 to 1946. Net farm income increased 175 per cent. Such price increases were wise. They were a powerful incent ative to increase production of war needed food and fibre. Tne efficient farm operator made nice profits, the operator made satisfactory profits. There was a general decline of "Cost Consciousness" among large numbers of farmers. Many seem to luve forgotten during prosperity that ccsts have a persistant tendency to remain high long after other prices have fallen. A great peril for many farmers is the tendency to confuse inflation in come with efficient management. Many who do not realize that nearly every farmer has made money during the past three years, take great pride in their earnings. These farmers are reminded that there have been no foreclosures, no failures, no re ceiverships. In times like these it doesn't take an efficient farmer to keep out of the red. Many farms that have been poorly managed have shown moderate net earnings. Some farmers regard the high I prices now current as the new "Nor mal." They seem to forget that after each of our major wars a price re action has reduced from profits from their post war level. There is no reason to believe that the next few years will be an exception. The longer farm prices continue at the present level, the greater will be the number of farmers who as sume that current prices and profits are normal. Some who operate con servatively the first few months of the next year may easily be the ones to relax their conservatism at the time it is needed most. Much of agriculture's difficulty from 1920 to 1940 was due to the high indebtedness incurred during 1919 to 1920. Individual farmers will make the same mistake during the next year. Long-time mortgage obligations may easily bring un bearable annual payments. Charges of this character require annual pay ment of a stated number of dollars. If profits are cut in half, a fixed annual charge becomes twice as dif ficult .to pay. It is impossible to state what will be "Normal" next year, except th