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This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) District Agriculture- Production and Income Climb to Record Levels Agricultural production in states of the Eleventh District rebounded sharply last year from the setback of the drouth in 1971, soaring to a record level. The increase in total output combined with higher average prices to drive gross farm income to an estimated new high of more than $8 billion. Larger wheat and grain sorghum crops added to the increase in production, as did gains in most minor crops. But the biggest boost came fr~m cotton. Spurred by higher P~lces at planting time and favored WIth a good growing season, cotton growers in these states increased their output about 40 percent-the largest crop since 1965. Livestock production, on the other hand, showed little growth as Poor range conditions in 1971 and the resulting reduction in cow ~erds dampened cattle production In 1972. But with demand for fed be~f growing rapidly, rising cattle prIces contributed greatly to gross farm income. And to take full advantage of higher prices, growers worked their cotton more intensively. Closer cultivation and improvements in the weather contributed to greater yields. In Texas, for example, improved yields accounted for fully two-thirds of the increase in cotton production. Lint yields in Texas are estimated at 359 pounds per acre, compared with 263 pounds in Cotton leads crop gains in Southwest PERCENT CHANGE,1972 FROM 1971 ........... .:.:.:.:.:.:.:.:.:.:.:.:.: ........... .. CORN BUsiness Review I January 1973 W INTER WHEAT ........ ................ ................ ................... ........ :.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.:.: OATS Crop production The comeback in cotton was due O~l~ partly to better growing conditIons. Also important to the turnaround was a change in market C?nditions built up over the preVIOUS season. Growers ended their 1971 season with the smallest carryover in 20 years. And with consumers showing renewed interes.t in cotton goods, 1972 began With cotton prices averaging 40 percent higher than a year before. To meet the demand, farmers ~~rve.sted more cotton acreage. Of h lstnct states, only New Mexico A~fvested less acreage than in 1971. four of the other states harVested more. Louisiana harvested nearly a third more. 1971. With the increase in acreage, improved yields left Texas growers providing some 30 percent of the nation's cotton crop. All told, District states produced about 43 percent of the national total. Of other major crops in the District, only rice was off-and that was very little. Production of winter wheat was up a fourth from the drouth-stricken crop of 1971. And BARLEY .:.:.:.:.:.:.:.:.:.:.:.:... ........................... PEANUTS COTTON ALL CROPS I -40 I -20 I o I I 20 40 I 60 1972 indicated December 1 SOURCE: U.S. Department of A9riculture 1 production of grain sorghum rose sharply as bumper crops more than offset the slight cutback in acreage. In Texas, the grain sorghum crop was expected to about equal the previous high of 343 million bushels reached in 1967. Unlike the large sorghum grain crop that was due entirely to greater yields, the large wheat crop was the result of increases in both acreage and yields. The smaller rice crop was due mainly to smaller yields in Texas. Rice acreage in Texas and Louisiana was about the same as a year before. Larger crops of oats, flaxseeds, peanuts, potatoes, pecans, and soybeans added further to the gains in crop production. Among minor crops-which, together, make up about a fifth of the crop production in these states-only the corn and barley harvests were smaller than in 1971. And these declines were merely the result of fewer acres being planted. As the year ended, a larger citrus crop was being harvested. Gains in Arizona were only slight. But the Texas orange crop was 17 percent larger than in 1971, and the grapefruit crop was 13 percent larger. Together, these two states were expected to produce nearly 25 million boxes of grapefruit and oranges11 percent more than in 1971. portion of the nation's beef fed in Texas, Oklahoma, New Mexico, and Arizona from around 20 percent early in the year to over 25 percent at the end of October. In Texas and Arizona, the increase in the number of head on feed averaged 20 percent a month. But with more lightweight cattle being placed in feedlots and, therefore, taking longer to feed out, marketings out of feedlots were considerably less. Poor range conditions in 1971 led to a reduction in cow herds, especially in Texas and New Mexico. From 9.9 million head in early 1971, the beef cow herd for the District states fell to 9.6 million head in early 1972. By midyear, however, the cow herd had grown to an estimated 10 million head. And by year-end, estimates of the calf crop showed a slight gain over 1971. Beef slaughter, high while herds were being thinned in 1971, slowed in the early part of 1972. Part of the slowdown was due to a decline in slaughter of calves, and part was due to cattlemen holding back heifers to rebuild and expand cow herds. The slaughter had clearly picked up by midyear, however, and, with more animals beginning to come out of feedlots, had reached a level by the end of the third quarter about equal to a year livestock production in region last year slowed by low prices and drouth in 1971 PERCENT CHANGE, 1972 FROM 1971 BROILERS CATTLE AND CALVES Livestock production Strengthened by demand for fed beef, cattle prices continued to spur growth of cattle feeding in the Southwest. Feeding activity increased in Oklahoma, New Mexico, and Arizona. But by far the greatest increase was in Texas. By midyear, Texas had become the nation's number-one cattle feeding state. And with more than 2 million head on feed in the second half of the year, Texas was far enough ahead to hold a position other states were not apt to overtake anytime soon. The expansion in cattle feeding continued all year, raising the pro2 MOHAIR LAMBS -40 I -30 -20 -10 1972 partly estimated SOURCES: U.S . Department of Agriculture Federal Reserve Bank of Dallas o 10 20 before. By then, the momentum of the upturn was enough to carry the total for the year slightly above that for 1971. Other areas of livestock production also showed effects of conditions in 1971. Pork production fell ~harply after the low prices prevailIng during 1971 and did not recover until the latter part of 1972-although by then, the upturn was strong enough to give indications of continued expansion well into 1973. Production of sheep and goats had been trending downward for Some years. But prices of lamb and mutton, wool, and mohair were low enough in 1971 to cause still further contraction. As a result, ~ast year began with sheep flocks In the Southwest 6 percent smaller than at the start of 1971 and goat herds 27 percent smaller. The reduced flocks and herds caused further drops in the production of Wool and mohair, but prices imprOved. Production of lamb and lUutton also slowed, ending the year near the total for 1971. . Broiler and egg production PIcked up in 1972, but turkey production fell slightly. There was aTIs? a reduction in dairy herds. . ~s cutback, however, was about In line with the increase in productivity and left milk production about the same as in 1971. months of 1971. Both livestock and crop receipts contributed to this growth. Livestock receipts for the first ten months of the year were over $3.8 billion-15 percent more than for the same period a year before. Crop receipts amounted to nearly $1.9 billion-16 percent more than in 1971. Although most prices improved last year, an abnormal dip occurred on a broad front early in the year. Prices of major livestock commodities and upland cotton turned downward in February, in contrast to their usual seasonal increases. These declines were followed by drops in prices of several other crops, causing a downturn in aver- Income and prices 35- The record rise in gross farm in?ome in the Southwest drove net InCome sharply upward-probably to a new high well above the $2.2 billion of 1971. Several factors con~ributed to the advance. Increases crop production were important. ut hIgher prices (almost across the board), an increase in GovernlUent payments, and a slower increase in production costs also Contributed significantly. The general strength of farm in~ome is borne out by cash receipts ~om marketings. Receipts through ctober totaled $5.7 billion-15 Percent more than in the first ten B BUsiness Review I January 1973 age prices lasting into April. Toward the end of that month, however, prices of most commodities began trending upward. And by November, average prices received by farmers and ranchers in Texas had rallied to a level 14 percent above a year before. Several commodities experienced unusual price movements in 1972. Grain prices were sluggish in the first half of the year, following the record crop in 1971. But with the unexpected surge in demand brought on by the Soviet purchase announcements in July, prices advanced rapidly. The unseasonable price rise and expanded production boosted grain crop receipts sub- Demand for feeder cattle widens feeder-slaughter price gap DOLLARS PER HUNDREDWEIGHT THOUSAND HEAD 5o------------------------------------------~------ 3 , 600 CHOICE FEEDER STEER PRICES 45CHOICE SLAUGHTER STEER PRICES 40- - 3,000 f - 2 ,400 30- 25 - - - r - 1,800 SOURCE: U.S. Department of Agriculture 3 Livestock prices received stantially in the second half of the by Texas producers lead price advance . .. year. Prices of rice followed a similar 1967 = 100 pattern. Until August, they were 160---------------------------------------------relatively stable. But with export demand rising in the fall and world and domestic supplies tightening, LIVESTOCK AND LIVESTOCK PRODUCT PRICES prices rose rapidly in the last five 150months of the year. Cotton, unlike grain and rice, started the year with prices well 140ahead of year-earlier levels. But as harvest got underway in Augustamid initial reports of a larger than expected crop-prices plunged, espe- 130cially for the lower grades. Later in the season, inclement weather plagued harvests and reduced pros- 120 _ pective production. This uncerCROP PRICES tainty, together with the depressed prices and the very real possibility of a smaller crop in 1973, led to 110 renewed buying activity and a stronger cotton market. Beef cattle prices started the 100 I year well ahead of year-earlier 1972 1971 levels. And with demand for fed beef increasing throughout the year sou R C E: u.s. De partment of A9 ricu Itu re and supply remaining tight, prices of both feeder and fed cattle continued to rise with fe~ interruptions. The record upsurge in feeder tially eased the cost-price squeeze 30, with growth evenly distributed cattle prices was also attributed to that had plagued farmers and between real estate and non-realthe development and growth of ranchers throughout 1970 and estate loans. large feedlots, excellent feedlot remost of 1971. Other major credit institutions turns early in the year, and a favorprovided further evidence o~ the Other developments' able ratio of fed cattle prices to increase in agricultural lending. In prices of feed. With their financial positions imTexas, for example, loans outstandPrices of other livestock also rose proving significantly through 1972, ing at both production credit assosubstantially during the year. Hog District farmers and ranchers inciations and the Federal Land Banl{ prices averaged more than half creased their borrowing to record of Houston rose 14 percent in the again higher than their monthly levels. The cost-price squeeze, toyear ended last September. The levels a year before. And monthly gether with tight financial condiFarmers Home Administration also prices of wool and mohair retions, had slowed many types of recorded significant increases in bounded from their 1971 lows, with agricultural borrowing in 1970. loans, especially for rural housing. wool prices increasing threefold While credit conditions improved A significant portion of the funds and mohair prices fivefold. in 1971, borrowing was held back obtained by borrowing was used With prices of most crops and by the drouth and low income. As of new equipment as for purchases livestock trending upward, prices a result, capitalization and expanfarmers replaced older, less efficient received by farmers and ranchers sion plans were postponed, creating machinery. For example, over 50 advanced much faster relative to a backlog of demand. percent more tractors were sold (on prices paid than had been the case Reflecting the increased borrow- a unit basis) in the District states in other recent years. In Texas, for ing in 1972, agricultural credit out- in the first eight months of 1972 example, prices received by farmers standing at commercial banks in than in the same period a year beand ranchers increased about twice the District advanced more than fore. Sales of other farm equipment as fast as prices paid. This substan- 22 percent in the year ended June also posted gains. 4 .. . as prices received surge ahead of prices paid 1967 = 100 150----_____________________________________________________________________________________________________ 140 - PRICES RECEIVED FOR TEXAS FARM PRODUCTS 130- PRICES PAID BY FARMERS 110'l----------------------~~--------------------__, 1971 1972 SOURCE: U.S . Department of Agriculture As more funds became available, th e demand for farmland also increased significantly. In the year ende~ last March, prices of farmland In the District states increased an average of nearly 9 percent, co~pared with 8 percent for the natIon. Louisiana and Texas, with average price gains of 12 percent athnd 10 percent, respectively, led e District states. . Another significant development In t972 was the record level of agri~ tural exports. Farmers in the t.l~trict were unable to fully part IClpate in the early expansion due the 1971 drouth and resulting Sort crops. Where the nation reCorded a 4-percent increase in ex~orts in the fiscal year ended June O, exports from the District states d l' h e ~flned 13 percent. In the second !i of 1972, District exports-espeCIally of rice, wheat, and feed grains -expanded in line with increased h BUsines . I January 1973 . S R eVlew production. However, shipments of cotton, traditionally the District's largest export crop, lagged because of slower demand. A look ahead Prospects for 1973 seem very favorable for both crop and livestock producers in the District. Strong demand for farm products is expected to continue, bolstered by expanding personal income, a growing domestic population, and strengthening foreign demand. Farm income, therefore, is apt to remain near the record level of 1972. Both farm population and the number of commercial farms will likely continue to decline as offfarm employment alternatives remain good and the consolidation of farm units continues. And these developments should mean a rising average income per farm. Although a decline is expected in farm popu- lation, the number of rural residents will likely increase as modern highway systems and spreading metropolitan centers offer more families the opportunity for urban employment with rural residence. Improved international relations should continue to strengthen agricultural exports. The problem of surplus commodities that plagued U.S~' agriculture in the 1960's has been virtually eliminated. Any increased demand, therefore, will be reflected in stronger average farm prices and subsequent production increases. But to prevent producers from overreacting to extreme price fluctuations, Government programs will probably seek to strike a balance between supply and demand. The outlook for major District crops appears good. Although 1972 feed grain production declined only slightly from the record 1971 crop and wheat stocks were quite large early last year, record exports brought about important shifts in the situation by year-end. Provided exports maintain their 1972 levels and domestic consumption continues to expand, average grain prices should increase this year. Cotton production in 1972 surged an estimated 2 million bales over disappearance, raising carryover to about 5 million bales. To head off increased stocks and depressed prices, growers are expected to cut production this year to just under 12 million bales, a level that should just about equal estimated disappearance. Demand for soybeans continues to expand more rapidly than production, keeping supplies tight and prices strong. Prices for rice are also expected to hold strong as world demand continues to expand. Livestock producers can expect to receive significant support from increased consumer demand. Rising personal income levels, together with strong consumer preference for beef, will probably absorb the projected increase in beef production and sustain the favorable price 5 levels reached in 1972. A turnaround in pork production is expected early this year, although no major price decline is anticipated. The poultry situation should improve. Prices of broilers and turkeys may remain above the low levels last year in spite of an expected increase in production. A decline in numbers of layers is expected to decrease egg production and strengthen prices. Although farm incomes and prices have improved, farmers and ranchers must be very cautious of excessive production that would 6 reverse the picture for prices and incomes. Even in 1972, the total new supply of agricultural commodities outpaced demand despite an unexpectedly sharp rise in export demand. If agricultural production is to expand at a rate faster than domestic population growth, trade must expand. But this trade is subject to sudden shifts, and care must be exercised to avoid misinterpretation of short-run situations. -Carl G. Anderson, Jr. Dale L. Stansbury Federal Budget- Patterns Already Set Limit Choices to Be Made The President submits his FY '74 budget to Congress this month. Work on the budget, which becomes effective July 1, began a year ago-18 months before the start of FV'74. It will provide a fairly clear statement of how the Administration t hinks the nation's resources might best be allocated. Its size and the PreSident's plan for financing it will affect production, employment, and the !ate of rise in prices. And the ChOIce of taxes he proposes will determine how various groups are ~o help shoulder the burden of payIng for Government services. And yet, much of the budget will reflect established trends to which ~~e Administration (and the naIon) can only adapt. The program now covers 95 percent of the people over age 65. In addition, spending on education and manpower training programs has increased more than six times since 1963. And payments for income security (mainly Social Security) have increased almost three times. With these increases in outlays have come marked shifts in the composition of Government expenditures-in the allocation of resources. Although Defense spend- ing, for example', has increased almost $26 billion, it now accounts for only a third of the Government's total spending, compared with almost half in FY '63. Meanwhile, outlays for health care have increased from little more than 1 percent of the budget to over 7 percent. And spending for income security has increased from 22 percent to 28 percent. Although federal spending has risen sharply over the past ten Growth in budget outlays outpaces GNP BUDGET GNP BILLION DOLLARS 240 - - - - - - - - - - - - - - - - - 1,200 Larger budgets .•• ~he budget has grown rapidly over e past ten years. Total outlays rose from $111.3 billion in FY '63 to $231.6 billion in FY '72-or at a~ ~nual rate of 8.5 percent. Much o thIS was due to inflation. MeaSured in terms of the purchasing POWer of the 1972 consumer dollar ~though not necessarily that of ' overnment-spent dollars, the inFre~se was from $153.9 billion in fV 63-an average annual increase o 4.6 percent. During that time, constant-dollar GNP grew an aver:ge of only 3.4 percent a year. As percentage of GNP Government sp r' «:n ding was clearly 'inching ahead, t ISIng from 19.4 percent in FY '63 021.1 percent in FY '72. t The fastest rise was in expendii~res on human resources. Spendg on health care in FY '72 for eJra mp Ie, was more than 12 times ' ?l'eater than in 1963. Most of the ~~~rhease hB:s come since eI?actment e Medicare program m 1967. nUsines s R eVlew . I January 1973 200 - -1,000 160 - - 800 - 600 80 - - 400 40 - - 200 PRODUCT o I 1963 1966 I 1969 I o 1972 FISCAL YEARS SOURCE: The Budget of the United States Government, 1973 7 Defense spending declines relative to other budget outlays years, receipts, too, have almost doubled. This increase in revenues PERCENT OF TOTAL BUDGET OUTLAYS has been due both to an increased 100revenue yield from existing taxes ALL OTHER as the economy expanded and to changes made in the tax laws to EDUCATION help finance new social programs. 80But there has also been a clear MANPOWER shift in the types of taxes the GovHEALTH ernment emphasizes. Payroll taxes INTEREST have been the fastest rising of all 60taxes, replacing corporation income taxes as the second largest source INCOME of revenue. SECURITY Individual income taxes still ac40count for about 45 percent of Government receipts. But where Social Security taxes, mainly on wages and salaries, accounted (along with DEFENSE employers' contributions) for 19 percent of budget receipts in FY '63, they accounted for over 27 percent in FY '72. And where corporation income taxes accounted for 20 1973 1971 1963 1969 1965 1967 percent in FY '63, they accounted FISCAL YEARS for only 15 percent in FY '72. 1973 estimated As a percentage of family income, SOURCE: The Budget of the United States Government,1973 payroll taxes are now the largest taxes paid by families earning up to $10,000 a year-and that is about half the families. the uncontrollable programs are One place where sizable amounts And this shift in emphasis connot subject to a yearly appropriacould be cut in FY '73 is in the Detinues. In line with the growing tions review by Congress. fense budget, which contains aloutlays for health care and income The importance of these promost two-thirds of the controllable maintenance, Social Security taxes grams outside the appropriations items. Over half the Defense budwere increased again this month. procedures has been pointed up in get, however, goes for military and the President's efforts to hold FY civilian pay. And with personnel ... harder to control '73 spending under $250 billion. levels already close to the lowest As the Government has grown bigThe agency with the largest budin years, any further cuts in perger, so has the problem of controlget authority is the Department of sonnel would be hard to make. ling the budget. Essentially unconHealth, Education, and Welfare. The number of active-duty pertrollable items-mainly trust funds, But the President can control only sonnel, for example, is down 1.2 such as Social Security, and perma- a little over a tenth of its expenmillion from peak Vietnam levels nent or indefinite appropriations, ditures, the rest being from trust to a point lower than when the such as veterans' benefits-made funds for Social Security, disabilbuildup began in 1964. Any sizable up 71 percent of the budget author- ity insurance, and Medicare and cut in Defense spending, therefore, ity requested in the FY '73 budget. Medicaid. would have to come out of military And these items are expected to More than 80 percent of the investment-procurement, research exceed 75 percent by FY '77. Treasury's $27.7 billion budget au- and development, and military conUltimately, of course, all Govthority is for payment of interest struction. And these are items that ernment programs are controllable. on the national debt-another major have already been pared by ConTrust funds, for example, were item the President cannot control. gress and the Administration. created by legislative action and The uncontrollable portions of Spending could also be reduced can be altered or eliminated in the the budgets of these two agencies in some other relatively controlsame way. Barring such congresalone account for more than $100 lable areas, such as federal grantssional action, however, funds for billion in the FY '73 budget. in-aid, and payments under some ~~~I~bf~!~~4~~~~~~rAND r 8 SOcial insurance replaces corporation income as second largest source of federal fax revenue ALL OTHER 1963 1968 1973 FISCAL YEARS 1973 estimated SOURCE: The Budget of the United States Government , 1973 programs could be postponed. To help reduce the budget deficit still further, additional revenue could be raised by the Government through the sale of assets, such as oil leases and mineral and timber rights. So in FY '74 •.• Even if the President can hold expenditures to $250 billion in FY 73, the large deficits of recent Years might easily continue. With?ut ~ny major new programs, proieCh.ons .by both the Brookings ~Sh~utlOn and the American Ent rprlse Institute show expendiures growing by about $50 billion $~~r t~e next two years, reaching t" 0 bIllion in FY '75. During that ~~e, With no tax increases, receipts Ii 1 probably grow about $60 bilon, reaching $283 billion. That~SUming full employment-will still aVe a deficit of $17 billion. in ~ost of the projected increase overnment spending comes nus· lDess Review I January 1973 from programs already established. Defense spending, for example, is apt to rise at least $10 billion-primarily reflecting both projected price increases and greater reliance on strategic forces. The biggest item in this category will probably be development of a new sea-based missile system. But movement to an all-volunteer Armed Forces will also push up costs. Military pay has been trending upward for many years. Typically, an Army recruit received $288 a month last year, compared with $78 ten years before. A colonel received $1,933, compared with $985 a decade before. Additional increases became effective January 1, and still more may be needed to attract volunteers. Incentive bonuses tied to an escalator plan are already scheduled for FY '74. Actual Defense expenditures could, in fact, exceed the $10 billion expected rise. The budget makes no allowance for possible cost overruns on defense contracts. But a survey conducted by the General Accounting Office two years ago showed that 52 major weapon-system contracts were overrun an average of 30 percent. But as in other recent years, the biggest increases are apt to be in areas other than defense. For all his efforts to cut Government spending, the President has not been able to reduce the costs of established social programs-or even prevent their rise. Under the President's own plan to increase Social Security payments, for example, the cost would have risen almost $7 billion in FY '73. And Congress increased payments enough to raise the bill another $2 billion. The uptrend in this type spending shows no sign of abating. With a growing number of beneficiaries becoming eligible for Social Sp9 tinue. But while the Government seems likely to run deficits in its spending through FY '75, the outlook is for these deficits to begin decreasing somewhat. With continued improvements in employment, revenues should begin catching up with spending on current programs sometime after FY '75, creating the possibility of a turnaround by FY '77-provided no substantive changes are made in existing programs and no new programs are initiated. Then, the U.S. Government, like state and local governments, could begin running small surpluses. Before that, however, other factors will have started influencing the Administration's options. Even allowing for the unlikely ..• and years beyond possibility that further major inAs the Administration begins work creases in spending can be avoided, on the budget for still another fiscal taxes may have to be raised to reyear, many of the conditions that duce the inflationary consequences limited its choices in preparation of deficit spending in an economy of the FY '74 budget clearly connearing full employment. Decisions to be made over the next two or three years, then, might include the need for higher taxes. Taxes can be increased essentially Uncontrollable items increase in relative importance three ways• By raising rates on the current BILLION DOLLARS tax base 250 ----------------------------------------------~~• By changing the tax base RELATIVELY UNCONTROLLABLE ITEMS • By imposing a new tax • TOTAL BUDGET OUTLAYS Raising rates on a given tax base is a fairly straightforward way of 200 increasing revenue. The Government could balance its budget as ~arly as FY '75 merely by imposmg a 10-percent surtax on indi150 vidual and corporation income taxes. The effect of such a change would, of course, be a 10-percent 100 increase in the tax itself. Changing the tax base is not so simple. Often falling within the realm of reform, the matter of re50 definition of the base is usually de1967 1968 1969 1970 1971 1972 1973 voted to what many consider the FISCAL YEARS closing of loopholes. A staff report 1972 and 1973 estimated for the Joint Economic Committee SOURCE : U.S . Office of Management and Budg e t shows that major federal tax subsidies cost the Government almost $36 billion in FY '71. If this esti- curity payments, the cost of the program will be some $8 billion higher in FY '75-without any further increases in benefits. And Medicare and Medicaid will push the cost still higher. As with the basic Social Security program, the increases will be due to the combination of an increased number of beneficiaries and substantially higher benefits already enacted. Without any new programs, health-related spending will rise an estimated $5 billion by FY '75. And by then, there could be substantial support for some kind of national health insurance. A presidential commission recently recommended such a move, and the President indicated he would favor such a program-albeit on a voluntarybasis. Meanwhile, the KennedyGriffiths bill for a Health Security Act is pending in Congress. Passage of this or some other national health plan would add significantly rn 10 to Government spending. According to the Department of Health, Education, and Welfare, the Kennedy-Griffiths program would cost $90 billion a year. By eliminating the need for Medicare and Medicaid, it would cost a net $60 billion. Revenue sharing will also increas.e the budget-probably about $8.3 billion this fiscal year. Enacted last year, this program to share federal revenue with state and local governments comes, paradoxically, when state and local government expenditures are beginning to run surpluses. During the current fiscal year, state and local governments are expected to collect revenues exceeding their aggregate expenditures by $15 billion. mate is anywhere close-and even if the costs of these tax subsidies did not increase between FY '71 and FY '75-the budget could be balanced by eliminating only half the special provisions used to reduce tax liabilities. But which half? All these provisions benefit groups that want to keep them. And as Chairman Wilbur Mills of the House Ways and Means Committee has said, they were written into law by presumably rational men for presumably rational reasons. Probably the only realistic possibility for a new tax would be on consumption-such as a sales tax or the often-mentioned value-added tax. A tax on consumption, however, tends to be regressive. Taking ~ declining portion of income as lncome rises, it falls heaviest on lower income groups. Historically, tBJCes of this kind have been opPOsed in this country. The most likely expectation is that rates will be raised and some tBJC provisions changed to redefine the tax base. Some such tax revisions may be needed. For the budget to be bal~ced under the current tax strucure by FY '77 there can be no major changes'in federal programs ;a~d. not only do the provisions of b:lClstlllg programs tend to change ut demands for additional pro~ams develop constantly. The .0Vernment can exercise discretion in meeting the demands on it only if revenue is available or general economic conditions will allow Busincss R eVlew . I January 1973 Budget authority in one year affects outlays in future years BILLION DOllARS TO BE SPENT IN 1973 148 .0 OUTLAYS IN 1973 246.3 • UNSPENT AUTHORITY FOR ~ OUTLAYS IN FUTURE YEARS 289.8 .-.. SOURCE: The Budget of the United States Government, 1973 deficits. And the need for a more balanced budget could become serious long before FY '77. With the economy coming closer to full employment, a decision about Government revenues will have to be made. And like all decisions regarding the budget, the action taken (or not taken) will require that the public pay-either directly through higher taxes or indirectly through inflation. -George E. Garrison 11 Federal Reserve Bank of Dallas January 1973 Statistical Supplement to the Business Review Total credit at weekly reporting banks in the Eleventh District rose ~arplY in the four weeks ended ecember 20, largely reflecting ~eavy borrowing by businesses. The Increase in bank credit was accomlnodated through sizable inflows of deposits. Total loans, adjusted for a small ~ecline in loans sold outright to .ank affiliates, advanced substantIally. While business loans acCOunted for most of the increase, real estate and consumer installnent loans also showed strength. With the increase in loan derand, banks added only moderateto their holdings of securities. cquisitions of municipal issues a.ccounted for most of the expanIon , but banks also increased their oldings of short-term Government acurities. Holdings of longer-term overnment issues were reduced SOtnewhat. I T0t:'li deposits expanded marked/';un.ng this period, principally e ect111g the sizable inflo)'V of delnand deposits. There was a mod~}1ate increase in time and savings thPosits, although, as is typical at c .at time of year, large CD's ded~ne~ s~mewhat. Despite the large SlOSlt mflows, banks increased ghtly their reliance on non dePOsit sources of funds to further aCCOtnmodate credit demands. X h ~~aSo?allY adjusted total employnt 111 the five southwestern states inas up again in November, breakin g 9ctober's record high and posttn g Its fifth consecutive month-toP Onth rise. The new level was 3.3 u~rcent above a year earlier. The feuetnployment rate for November in oto 4.0 percent from 4.4 percent 1971ctober. The rate in November Was 4.7 percent. \\> All categories of nonfarm employment showed gains over a year before. The strongest advances were in construction (7.7 percent) , finance (5.4 percent) , and durable manufacturing (5.0 percent). The only category reporting a monthto-month decline in employment was the service industries-down 0.1 percent. Durable goods manufacturing showed the largest increase over October, a gain of 0.8 percent. Employment in construction and nondurable manufacturing also posted strong gains. Registrations of new passenger automobiles in Dallas, Fort Worth, Houston, and San Antonio rose 1 percent in November, reaching a level 13 percent above a year earlier. Cumulative registrations for the first 11 months of 1972 were 12 percent higher than for the same period in 1971. Department store sales in the Eleventh District were 14 percent greater in the four weeks ended December 23 than in the corresponding period in 1971. Cumulative sales through that date were 11 percent higher than in the comparable period a year before. The seasonally adjusted Texas industrial production index rose 1.2 percent in November to 134.5 percent of its 1967 base. Gains were reported in all three major sectors of the index-manufacturing, mining, and utilities. Nationwide production also showed advances in all sectors. Since the start of 1972, the Texas index has risen nearly 10 percent. In manufacturing, durable goods production continued to provide the primary impetus, rising 2.7 per- cent over October. All durable goods industries showed both month-to-month and year-to-year increases. The largest gains over October were in the output of fabricat ed metals, primary metals, and electrical machinery. Nondurable manufacturing rose slightly in N 0vember, despite decreases in textile mill products, chemical and allied products, and petroleum refining. Mining also advanced slightly, with increases in the output of crude oil and natural gas liquids more than offsetting declines in the production of natural gas and metal, stone, and earth minerals. Output of utilities showed a sharp rise of 4.2 percent, as the distribution of electricity rebounded from its sizable drop a month before. Prices received by Texas farmers and ranchers advanced slightly in the month ended November 15, reaching a level 14 percent above a year before. Unlike price increases in other recent months, the N 0vember rise was centered in crops, as livestock prices declined somewhat. Grain sorghum, rice, barley, and hay posted increases that more than offset declines in prices of beef cattle, calves, and poultry. However, the livestock price index remained 16 percent higher than a year earlier, while crop prices were only 6 percent higher. Higher prices, together with an increase in total production, boosted receipts from farm marketings in the Eleventh District states to $5.7 billion through the first ten months of 1972-15 percent more than for the same period of 1971. The rate of increase in receipts in the District states has been moderately better than in the nation as a whole. CONDITION STATISTICS OF WEEKLY REPORTING COMMERCIAL BANKS Eleventh Federal Reserve District (Thousand dollars) Dec.20, 1972 Nov.22, 1972 Dec. 22, 1971 Othe r loans and discounts, gross .. .......... ... . 1,426,193 8,769,102 1,155,718 8,591 ,470 1,057,662 7,351,540 Comm ercial and industrial loan s ... .... . .. .. . . 3,844,157 3,745,310 3,352,197 Agricultural loans, excluding CCC certiAcat es of interest •.............. ... . .. 228,94 1 227,801 158,300 1,340 85,438 1,308 92,924 1,111 50,565 6,773 471,444 7, 173 468,999 5,594 44 1,323 169,601 790,237 1,181,469 24,486 15,750 957,837 153,431 761,632 1, 158,942 21,067 16,676 941,926 158,127 52 1,543 912,76 1 23,099 32,572 821,816 0 99 1,629 3,803,437 0 994,281 3,713,575 0 872,532 3,306,206 985,988 192,957 0 984,323 177,797 0 1,045,700 102,801 0 ASSETS Fed e ral funds sold and se curities purchased Total deposits .. .. . ... . . . .................... under agre emen ts to resell .• . ....•..••.•.... loans to brokers and dealers for purcha sing or carrying : U.S. Government securiti es ........... . . .. . . Othe r securities ........... ..... ..... '.... . Other loan s for purchasing or carrying: U.S. Governm e nt securities .... . ..... . .. ... . Othe r securities ....... .................. . loans to nonbank Anencial institutions: Sales finance, personal AMance, factors, and other business credit companie s...... . Other •...... . ...••...•.... . • . ... .... .. Real estate loans .. ...................... . . Loans to domestic comm ercial banks .... . ..... . loans to foreign banks .. .. . ...... . .. . .. .. . . . Con sumer instalment loans ........... ...... . . Loans to foreign governm ents, offlcial institutions, central banks, and international institutions ... ..... .... . . " . . .. . ... ..... . Oth er loan s...•........... ... ..... . .. • . ... Total investments . ..... ....... . . . . . ......... . Total U.S. Government securities ........ .... . . Treasury bill s ........... . . .......... . .. . Treasury certiAcates of indebtedness ...•... . Treasury notes and U.S. Government bond s maturing: Within 1 year ••............. . ......... 1 year to 5 years •••................... After 5 years ......... .. ........ ..... . Obligations of states and political subdivisions: Tax warrants and short·term notes and bills ... 160,790 440,645 191,596 140,954 470,547 195,025 154,929 601,470 186,500 242,089 2,326,306 210,995 2,279,2 11 80,135 1,983,238 14,138 234,916 1,441,486 843,013 118,406 394,297 12,368 14,832 224,214 1,395,610 821,915 99,929 435,216 11,777 21,213 175,920 1,457,254 1,189,135 99,1 14 444,095 16,312 672,129 636,362 495,869 TOTAL ASSETS.......... . ............... 17,480,431 16,861,572 15,417,187 All other •.•••••..•.••..••..•• ... ..•..•. Oth er bonds, corporate stoc ks, and securitiesl C ertiflcates representing participation s in federal agency loans •....... ... . ..... .. All other (including corporate stoc ks} • •••.•.•. Cash item s in process of collection ....... . .....•. Reserves with Federal Reserve Bank ............ . Currency and coin •.•............. . .... .. •... Balance s with banks in the United Stat es ........ . Balances with banks in foreign countries .. •...•... Other assets (Including investments in subsidiaries not consolidated) •• ............... .. . ..•... Total d emand deposits ...• •... ... . .......... Individuals, partnerships, and corporations . ... State s and po litical subdivisions ............ U.S. Government .. ... ... ..... .. . . .. . .... Banks in the Unit ed States .... . . . ... .. .. ... Foreign: Governments, offlcial institutions, centra l banks, and international institutions . ..... Commercial banks . . ... . ... . ..... . . ... . Certifled and ofAcers' ch ecks, etc ... ..... .. .. Total time and saving s d eposits••... . . ... •. • . . Ind iViduals, partnerships, and corporations: Savings deposits.................. . ... . Other time deposits ...... . ........•.... State s and politica l su bdivisions ............ U.S. Government {including postal sa vings) •... Bank s in th e Unit ed Slates . .. . .......... . .. Foreign: Governments, ofAcial institutions, control banks, and in tern ational institutions ••.... Commercial bonks ........ . ... . ........ Fe dera l funds purchased and se curit ies so ld under agreements to re purcha se .•. . ...... . ... O ther lia bllitie s for borrowed money ............ Oth er liabilities ........... ...... . ....... . .... Reserve s on loans.•..........•.......... .. ... Reserves on securities ............•. .. . . .•....• Total capital accounts .. . ..... . .... . ..... . .... TOTAL ASSETSe •••.•..•.....•...•..•. 30,468 30,364 26,499 Demand d e po sits of banks ..•............ Other demand deposits.. . . . .. . . . . ....... Time d eposits ................. ... .. .... 1,594 11,1 00 12, 159 1,788 11,107 11,7 10 1,666 9,797 10,076 Total deposits ••....••....••....• . •. •• Borrowings ..... . . . .. .. .... .. . . .. ...... Oth er Jiabilitiese ••....... . ..... ....... . . Total capital accountse . . . . . . . . . . . • . .. . .. 24,853 2,224 1,225 2,166 24,605 2,409 1,191 2,159 21,539 1,809 1,243 1,908 TOTAL LIABILITIES AND CAPITAL ACCOUNTSe ••••• •• .. •••• ......... 30,468 30,364 26,499 e-Estimated 1,210,157 3,249,738 1,536,025 25,253 107,634 1,201,429 3,304,316 1,461,580 29,726 107,OB9 1,084,03 4 2,73 1,46 6 1,169,278 11 ,768 89,043 11,095 1,120 13,000 1,100 19,800 1,10 0 1,943,667 244,609 472,214 142,045 17,413 1,15B,623 1,920,670 85,73 1 432,799 141.D57 17,829 1,16 1,085 1,888,624 44,27 1 425,053 135,510 22,16 4 1,065,707 ---- ---16,861,572 --- - 15,4 17& TIME DEPOSITS _ U.S. --- - Governm ent Total Savings 206 166 266 300 281 300 314 384 280 289 226 254 264 222 8,622 10,025 10,273 10,607 10,864 10,978 10,938 11,075 11,233 11,304 11,441 11,492 11,618 12,009 2, 167 2,49 1 2,509 2,528 2,552 2,430 2,640 2,660 2,6B8 2,71 4 2,717 2,744 2,770 2,786 October ••• L1A81L1T1ES AND CAPITAL ACCOUNTS 2,380 36,01 4 91,866 5,106,489 7,570 8,23 1 8,388 8,510 8,382 8,515 8,696 8,530 8,553 8,694 8,824 8,933 9,034 9,321 November .. Cosh In vault • .•••• . .. .•. . •..••.•...• •. . 3,753 45,501 93,814 6,118,240 Adjusted' September. Balance s with banks in the United States .. .. Balances with banks in foreign counlries e .•.. Cash items in process of collection . .. •...... Other assets e ..... ... . ... .. ...... . .. . .. 2,891 40,551 155,647 6,141,022 Tota l (Million dollars) 14,028 2,352 4,415 1,726 271 1,183 12 1,508 1,004 6,729,369 4,686,248 295,267 246,836 1,370,758 10,843 11,64 1 11,98 1 12,313 11,983 12,118 12,470r 12,26B 12,320 12,529r 12,420 12,6 19 12,866 12,844 Jun e . . . . ... 16,154 2,328 5,363 1,723 326 1,334 IS 1,888 1,233 I1,B35,B58 Date July ••..••. August ••••• 17,021 2,338 5,340 1,350 318 1,241 12 1,548 1,300 - 1970, November • • 1971 , November • . Eleventh Federal Reserve District loans and discounts, gross •. . .. . ..... ..... U.S. Government obligation s..... ......... Oth er sec urities .. . • .. .. ....... ...... . ... Reserves with Federal Reserve Bank .... .. . . 4,930,000 533,035 147,995 1,230,063 DEMAND DEPOSITS April ..•... May .•.••• Item 13,102,401 (Averages of dally figures. Million dollars) CONDITION STATISTICS OF ALL MEMBER BANKS ASSETS ---6,984,161 7,360,83B 5,099,208 527,334 246,094 1,289,113 DEMAND AND TIME DEPOSITS OF MEMBER BANKS February . . .. March •.... Nov. 24, 1971 13,501,B60 ---- Dec. 22, 1971 Eleventh Federal Reserve District December .. Oct. 25, 1972 Nov. 22, 1972 TOTAL LIABILITIES, RESERVES, AND CAPITAL ACCOUNTS •• • • ..••....•• • •..• 17,480,431 1972. January .••• Nov. 29, 1972 Dec.20, 1972 LIABILITIES 1. Other than those of U.S. Government a nd domestic commercial banks, less cash Items In process of co ll ection r-Revlsed RESERVE POSITIONS OF MEM BER BANKS Eleventh Federal Reserve District (Averages of dally figures. Thousand dollars) 5 weeks en d ed 4 weeks end ed Item Dec. 6 1972 Nov. I, 1972 Total reserves held ..... . . . .... . . . With Federal Reserve Bank ..... . Currency and coin ... ......... . Required reserves .••.... . • ... .... Excess reserves .......... . ...... . Borrowing s ...... . • .......... •.. Free reserves ..............•.... 1,734,604 1,454,854 279,750 1,668,625 65,979 48,802 17,177 1,951,896 1,668,597 283,299 1,929,517 22,379 21,444 935 -- r BANK DEBITS, END-OF-MONTH DEPOSITS, AND DEPOSIT TURNOVER SMSA's in Eleventh Federal Reserve District - (DOllar amounts In thousands , seasonally adj usted) DE81TS TO DEMAND DEPOSIT ACCOUNTS' DEMAND DEPOSITS' Porcent chang e November 1972 - Standard metropolitan (Annual-rote basis) sta tisticol are a lARIZONA'T . ucson . . .. •....•..• ......... ..... ....... . OUISIANA, Monroe .. ......... ... ...... . ............ NEW Shreveport •....•...••...•••.••••.....•.• TEX MEXICO, Roswell ' .• • .. •....• .•.. • .... ••.... .. • . AS, ~:~2~!~"": :::::::::::::::::::::::::::::::::: Beaumont- Port Arthur-Orange ••.. ••............• S,ownsvillo.Harlingen.Son Benito ...... ........... CrYan-College Station ••••. .. •..•.•..•••... • ... f~~;1Y';· • • • • •. ·• • · • • ·• • •·• ~~~~~:':' .: :::::::::::::::::::::::::::::::::: ~i];:g~)," .•. .•• · • •. · • ·••.. •. . H olvoston-Tex a s City ..... ..... . ............ ... M~Allen-Pharr-Edinburg • . .... . . ••... . . •.... . .•• Terarkana (Texa s-Arkansa s) ..••..••..•.••••.••• ~~ift~:Llis:.:.:: ::::::: :: ::::::::::: : ::::::: : ---- TOl o l_ 29 centers ................................... $ 11,443 ,020 4,345,308 15,089,124 990,348 2,694,408 8,740,380 13,863,4 20 7,41 5,976 2,654,736 1,406,466 8,140,236 564,240 170,820,744 11,011,500 29,876,772 3,590,652 154,698,528 1,306,632 5,383,920 2,780,784 2,4 14,880 1,880,220 1,795,248 24,087,624 1,298,208 1,819,512 3,629,592 4,068,756 3,146,400 $500,957,634 Annual rote of turnover November 1972 from October 1972 November 1971 11 months, 1972 from 197 1 19 % 2 4 0 -2 -6 6 2 6 -8 3 6 12 11 1 -5 7 6 -9 0 -2 0 -2 6 -1 6 9 3 2 24% 24 19 -6 9 21 8 8 -5 13 5 9 19 43 20 21 19 14 15 36 8 1 13 7 3 8 41 6 11 26% 21 17 0 13 20 16 5 18 23 14 5 12 18 9 5 21 13 10 35 7 9 15 8 10 14 20 15 13 7% 18% 15% Novem b er 30, November Octob er 1972 1972 1972 $271,827 111,238 295,484 44,959 124,398 193,109 422,269 266,279 104,408 51,806 288,876 35,843 2,749,7 18 296,735 821,578 124,3 14 3,217,342 50,963 191,313 142,677 147,516 109,281 77,948 864,698 75,206 84,581 115,252 149,750 131,210 38.6 37.6 48.9 22.3 22.1 43.9 32.6 26.9 25.7 26.6 29.7 15.6 60 .2 35.4 36.7 28.4 48.0 25.2 28.3 19.1 16.2 17.0 22.8 27.6 16.8 21.3 30.6 27.1 23.7 30.9 35.9 46.6 22.8 22.8 45.9 30.8 26.1 24.5 29.1 30.2 14.7 54.4 31.4 37.2 28.8 45.3 23.7 31.9 19.8 16.1 17.4 23.2 26.6 17.0 20.2 28.0 27.2 23.0 32.6 35.2 46.4 23.9 23.2 42.8 34.6 26.9 31.0 26.6 29.3 16.0 59.1 27.4 35.2 27.0 45.8 26.5 26.4 17.7 15.7 19.7 22.7 31.0 17.9 20.9 24.7 28.7 22.5 42.7 40.1 41.4 $ 11,560,578 Novem ber 1971 1. 2. geposlts of Individuals, partnerships and corpora tions and of states and political subdivisions Ounty basis ' CONDITION OF THE FEDERAL RESERVE BANK OF DALLAS (Th BUILDING PERMITS --- oUsand doll a rs) _____ Item T~tol gold certiA cote Distau t f reserves • ..••..•• ..• ••• Or member banks ••••. .. •... , . •.• Oth er ~ ~ lJ,S. GO~:~nu~ ts and a~~ances .•• ... .. . . .•• .. Tolal e . ent seCUriti es • .•. ..... ..•• •• . .• ~ernbe~rb~~k o/sets .... . .. : .............. . odoral R eserve d eposits•. . • •. . .•.••.. ~serve not es in actual circulation ..... Dec. 20, 1972 Nov. 22, 1972 Dec. 22, 1971 211,268 191,155 302,317 13,075 496,061 975 3,103,764 3,294,919 1,392,108 2,280,725 3,169,044 3,182,119 1,384,976 2,221 ,198 3,275,522 3,276,497 1,696,569 2,132,291 o o VALUATION (Dollar emounts in thousands) Percent change Nov. 1972 NUM8ER o Nov. Area ARIZONA 1972 from 11 mos . Nove mbe r 1972 1972 11 mos. 1972 Oct . 1972 Nov. 1971 11 months, 1972 from 1971 438 7,640 $ 11 ,008 $160,563 50 446 998 5,136 705 8,649 22,921 59,005 -11 107 -2 152 38 -28 56 105 449 208 91 287 1,174 22 666 320 71 3,022 43 195 76 73 61 80 1,172 38 62 175 74 760 1,797 6,003 2,325 1,154 4,257 17,950 354 6,487 4,548 822 38,965 567 2,116 1,01 4 968 971 780 16,211 487 641 2,337 880 1,593 1,507 10,660 1,076 1,109 3,893 32,841 1,252 10,410 5,900 748 52,296 299 7,173 633 1,030 142 722 13,148 851 512 3,669 827 16,381 30,546 218,931 25,358 13,221 57,528 360,612 3,868 161,364 84,485 12,439 585,7 17 12,544 58,597 17,137 22,817 4,950 8,036 208,973 7,315 6,733 36,238 14,090 79 -71 -27 -14 -87 -5 92 628 -33 -46 -56 3 274 55 29 398 - 27 18 -30 195 88 1 -37 120 -16 -48 -20 119 -27 61 636 26 -24 -45 47 - 57 57 55 -78 -35 145 17 61 -86 16 -82 43 -2 24 40 41 Total-26 cities.. . 9,454 126,168 Tucson •.••..•. 32% 178% 98% LOUISIANA Monroe-West Monroe ..... Shreveport .•.. TEXAS Abilene •...... Amarillo . .. .. . Austin ....... . VALUE OF CONSTRUCTION CONTRACTS Be aumont •• , • . Brown svill e •... (Million dollars) Corpus Chri sti •. ----~ eandtyp e FIVE ST ~T~~.rHWESTERN Re.identi·a·l· • :. : . •• . . •• . . Nonresid.nt~ulldl~g: • . • • . • Nonb 'Id' 01 bUilding . • • . UNITED u, 109 construction.... R•• id ST.ATES............ Dallas .......• January - November Nove mber 1972 October 1972 Se ptem ber 1972 1972 1971r 8,432 10,497 960 775 864 4,157 5,398 526 445 478 2,524 2,776 266 183 242 1,751 2,323 169 147 145 73,948 85,029 8,197 7,248 8,225 31,735 42,296 4,135 NonreOs~~~~t~Uildi~g: • . . • • . 3,663 4,298 23,657 24,935 2,378 NOnbuli' 01 bu,ldlng . . . . 2,184 2,384 18,557 17,798 1,684 ~ng construction.... 1,402 1,544 1. Arlzo -:-;- -- - - - - - - -- - - - - -- - - - - :-;-Fl evlsn~ LoUiSiana, New Mexico, Oklahoma, and Texas "OTI:' e SOUFlc Details may not a dd to tot a ls because of rounding . 1:: F. W. Dodge DiviSion, McGra w-Hili Information Systems Company Deni son •...... EI Pa so •.....• Fort Worth . ••. Galves ton .•. •• Houston •.•.••. Loredo . •.• •• • Lubbock . • • . •. Midland • . •..• Odessa •.•.... Port Arthur • • . • Son Angelo .•.• Son Antonio . •. Shermon ..... . Tex arkana •.•. Waco ..... . . . Wichita Falls ... $172,853 $2 ,210,369 3% 18% -5 30 40 50 -24 6 3 67 10 34 89 - 14 -18 81 38 -36 48 -37 20% CITRUS FRUIT PRODUCTION INDUSTRIAL PRODUCTION (Thousand boxes) (Seasonally adj usted Indexes, 1967 Indicated 1972 State and crop 1970 1971 = 100) - November Octob er September November 1972p 1972 1972 1971 134.5 138.3 150.3 129.7 122.1 146.3 132.9 136.6 146.3 129.6 121.9 140.4 131.6r 133.4r 143.9 125.9r 122.1 r 150.4r 124.6 127.4 137.6 120.0 112.4 145.4 118.5 117.8 11 2.5 125.2 110.4 147.4 117.2 116.4 111.3 123.8 109.6 146.8 116.1 r 115.3r 109.9r 123.4r 110.2r 145.6r 107.4 106.0 99.1 115.9 102.5 136.0 Area and typ e of index t' TEXAS ARIZONA 4,900 2,540 5,100 2,600 Orang es ... . .. . ...... . .. . . G rapefruit . .......... . ... . TEXAS 5,800 9,200 6,800 10,400 Oranges ..... . ..... .. . .. . . Grapefruit ..... .. ........ . 3,560 2,520 Total industrial pro duction . . . .. . Manufacturing ..... .. ...... . ... Durablo •. ..•....... . ..... . .. Nondurab/o • •....•...•. ... •. . 6,200 10,100 Mining ..... . .. . . .......... . .. . Utilities .•.. ........ . .... . .... . UNITED STATES SOURCE: U.S . Departm ent of Agriculture Total indu strial production ... . .. Manufacturing .. .. ...... . .... . . Durable .. ....... . ....... .. . . Nondurable . .. . ... ....... ... . Mining ... .. ...... . .... . . . ... . . Utilities ...... . ... .... ... .. ... . p- Prellmlnary r-Revised SOURCES : Board 01 Governors of the Federal Reserve System Federal Rese rve Bank of Dallas LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT Five Southwestern States 1 (Seasonally adjusted) Percent change Nov. 1972 from Thousands of persons November Item 1972p October 1972 Nove mber 197 1r Oct. 1972 Nov. 1971 DAILY AVERAGE PRODUCTION OF CRUDE OIL -- (Thousand barrels) Civilian labor force .••..... .. Total employment •••. . •••• .. Total un em plo yment .. ....... Un em ployment rate •• .... ... Total nonagricu ltural wage and salary employment ... . Manufacturing . ... ....... Durabl .. . ............. Nondurable ... . .. .. . . . Nonmanufacturing •.•.. ... Mining ............... . Construction . ..• .. ••. . • Tran sportation and public utilities ........ Trade ....... . ........ Finance ... • ........... Service .... ..•...... .. Government .•......... 8,553.5 8,215.1 338.5 4.0% 8,582.6 8,208.2 374.4 4.4% 8,348.5 7,953 .1 395.4 4.7% 6,721.7 1,177.0 644.6 532.4 5,544.7 227.6 454.1 6,704.2 1,169.6 639.8 529.8 5,534.6 227.6 451.0 6,464.5 1,132.2 613 .7 518.5 5,332 .2 227.0 421.5 .3 .6 .8 .5 .2 .0 .7 4.0 4.0 5.0 2.7 4.0 .3 7.7 458.4 1,595.3 360.7 1,085.6 1,362.9 458.3 1,592.2 360.0 1,086.5 1,359.1 449.2 1,525.0 342.3 1,042.3 1,325.0 .0 .2 .2 - .1 .3 2.0 4.6 5.4 4.2 2.9 -0.3% 2.5% .1 3.3 -9.6 - 14.4 '_.7 ' -.4 Percent change from 1. Arizona , Lou isiana, New Mexico, Oklahoma, and Texas 2. Actual change p-Preli mlnary r-Revlsed NOTE: Details may not add to totals because of rounding. SOURCES : State employment age nci es Federal Reserve Bank of Dallas (seasonal adjustment) October 1972 November 1972 6,941.1 2,556.2 296.0 537.6 3,551.3 733.4 1,748.9 242.6 66.5 759.9 9,540.6 7,020.0 2,609.3 296.0 557.3 3,557.4 731.6 1,738.5 246.5 66.6 774.2 9,603.5 6,563 .7 2,495.0 314.8 585.2 3,168.7 593.2 1,602.9 168.9 70.0 733.7 9,201.2 Novem ber Area 1971r ------------~ --Octob er November 1972 1971 ---------------------------------------FOUR SOUTHWESTERN STATES ........ .. ...... . Louisiana .... . ...... . ... . N ew Mexico • . ... .. ...... Oklahoma ....... . ...... . Texas ................. . Gulf Coa st .. . . . ...... . West Texa s .... . . .. .. . East Toxas (proper) . .. . . Panhandle • ..•......... Rest of state . . ........ . UNITED STATES ........... . - 1.1% -2.0 .0 -3.5 - .2 .2 .6 -1.6 -.2 -1.8 -.7% 5.7% 2.5 _6.0 _8.1 12.1 23.6 9.1 43.6 _5.0 3.6 3.7% --~~~---------------------------------------------r- Revised SO URCES: Americ a n Petroleum Institute U.S . Bureau of Mines Federal Res erve Bank of Dallas