The
agricultural policy
Agricultural policy describes a set of laws relating to domestic agriculture and imports of foreign agricultural products. Governments usually implement agricultural policies with the goal of achieving a specific outcome in the domestic agricultu ...
of the
United States
The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territori ...
is composed primarily of the periodically renewed federal
U.S. farm bill
In the United States, the farm bill is the primary agricultural and food policy instrument of the federal government. Every five years, Congress deals with the renewal and revision of the comprehensive omnibus bill. Johnson, R. and Monke, J. (8 ...
s. The Farm Bills have a rich history which initially sought to provide income and price support to US farmers and prevent them from adverse global as well as local supply and demand shocks. This implied an elaborate subsidy program which supports domestic production by either direct payments or through price support measures. The former incentivizes farmers to grow certain crops which are eligible for such payments through environmentally conscientious practices of farming. The latter protects farmers from vagaries of price fluctuations by ensuring a minimum price and fulfilling their shortfalls in revenue upon a fall in price. Lately, there are other measures through which the government encourages crop insurance and pays part of the premium for such insurance against various unanticipated outcomes in agriculture.
According to the United States Department of Agriculture
"U.S. agricultural policy—often simply called farm policy—generally follows a 5-year legislative cycle that produces a wide-ranging “Farm Bill.” Farm Bills, or Farm Acts, govern programs related to farming, food and nutrition, and rural communities, as well as aspects of bioenergy and forestry. The most recent of these Farm Bills, the Agricultural Improvement Act of 2018 (2018 Farm Bill), authorizes policies in the areas of commodity programs and crop insurance, conservation on agricultural lands, agricultural trade (including foreign food assistance), nutrition (primarily domestic food assistance), farm credit, rural economic development, agricultural research, State and private forestry, bioenergy, and horticulture and
organic agriculture
Organic farming, also known as ecological farming or biological farming,Labelling, article 30 o''Regulation (EU) 2018/848 of the European Parliament and of the Council of 30 May 2018 on organic production and labelling of organic products and re ...
. The 2018 Farm Bill replaces the 2014 Farm Bill, in place from 2014 through 2018."
History of the U.S. Agricultural Policy: 1920 to 1996
Until the 1920s, the first 150 years of agricultural policy in the US was dominated by policies directed at developing and supporting family farms and the inputs of the total agricultural sector, such as land, research, and human labor. Developmental policy included such legislation as the
Land Act of 1820
The Land Act of 1820 (ch. 51, ), enacted April 24, 1820, is the United States federal law that ended the ability to purchase the United States' public domain lands on a credit or installment system over four years, as previously established. The n ...
, the
Homestead Act
The Homestead Acts were several laws in the United States by which an applicant could acquire ownership of government land or the public domain, typically called a homestead. In all, more than of public land, or nearly 10 percent of t ...
, which granted townships, and the
Morrill Act
The Morrill Land-Grant Acts are United States statutes that allowed for the creation of land-grant colleges in U.S. states using the proceeds from sales of federally-owned land, often obtained from indigenous tribes through treaty, cession, or s ...
of 1862, which initiated the land-grant college system, one in a long series of acts that provided public support for agricultural research and education. In 1933, with many farmers losing money because of the
Great Depression, President
Franklin D. Roosevelt
Franklin Delano Roosevelt (; ; January 30, 1882April 12, 1945), often referred to by his initials FDR, was an American politician and attorney who served as the 32nd president of the United States from 1933 until his death in 1945. As the ...
signed the
Agricultural Adjustment Act
The Agricultural Adjustment Act (AAA) was a United States federal law of the New Deal era designed to boost agricultural prices by reducing surpluses. The government bought livestock for slaughter and paid farmers subsidies not to plant on par ...
, which created the Agricultural Adjustment Administration (AAA). The AAA began to regulate agricultural production by destroying crops and artificially reducing supplies. It also offered subsidies to farmers to encourage them to willingly limit their production of crops.
The
Supreme Court later struck down the AAA as unconstitutional, so in 1938 the
Soil Conservation and Domestic Allotment Act was passed, which essentially created a similar organization for distributing farmer subsidies.
1920-1939: Beginning of price supports
At the end of
World War I
World War I (28 July 1914 11 November 1918), often abbreviated as WWI, was one of the deadliest global conflicts in history. Belligerents included much of Europe, the Russian Empire, the United States, and the Ottoman Empire, with fightin ...
, the destructive effects of the war and the surrender burdens enforced on the
Central Powers
The Central Powers, also known as the Central Empires,german: Mittelmächte; hu, Központi hatalmak; tr, İttifak Devletleri / ; bg, Централни сили, translit=Tsentralni sili was one of the two main coalitions that fought in ...
of Europe bankrupted much of Europe, closing major export markets in the United States and beginning a series of events that would lead to the development of agricultural price and income support policies. United States price and income support, known otherwise as
agricultural subsidy
An agricultural subsidy (also called an agricultural incentive) is a government incentive paid to agribusinesses, agricultural organizations and farms to supplement their income, manage the supply of agricultural commodities, and influence t ...
, grew out of acute farm income and financial crises, which led to widespread political beliefs that the market system was not adequately rewarding farm people for their agricultural commodities.
Beginning with the 1921
Packers and Stockyards Act
The Packers and Stockyards Act of 1921 (Title 7 of the United States Code, 7 U.S.C. §§ 181-229b; P&S Act) regulates meatpacking, livestock dealers, market agencies, live poultry dealers, and swine contractors to prohibit unfair or deceptive prac ...
and 1922
Capper–Volstead Act
Capper–Volstead Act (P.L. 67-146), the Co-operative Marketing Associations Act (7 U.S.C. 291, 292) was adopted by the United States Congress on February 18, 1922. It gave “associations” of persons producing agricultural products certain exem ...
, which regulated livestock and protected
farmer cooperatives against
anti-trust suits, United States agricultural policy began to become more and more comprehensive. In reaction to falling grain prices and the widespread economic turmoil of the
Dust Bowl
The Dust Bowl was a period of severe dust storms that greatly damaged the ecology and agriculture of the American and Canadian prairies during the 1930s. The phenomenon was caused by a combination of both natural factors (severe drought) a ...
(1931–39) and
Great Depression (October 1929–33), three bills led the United States into permanent price subsidies for farmers: the 1922
Grain Futures Act
The Grain Futures Act (ch. 369, , ) is a United States federal law enacted September 21, 1922 involving the regulation of trading in certain commodity futures, and causing the establishment of the Grain Futures Administration, a predecessor orga ...
, the June 1929
Agricultural Marketing Act, and finally the 1933
Agricultural Adjustment Act
The Agricultural Adjustment Act (AAA) was a United States federal law of the New Deal era designed to boost agricultural prices by reducing surpluses. The government bought livestock for slaughter and paid farmers subsidies not to plant on par ...
– the first comprehensive
food policy
Food policy is the area of public policy concerning how food is produced, processed, distributed, purchased, or provided. Food policies are designed to influence the operation of the food and agriculture system balanced with ensuring human health ...
legislation.
Out of these bills grew a system of government-controlled agricultural
commodity prices and government supply control (farmers being paid to leave land unused). Supply control would continue to be used to decrease
overproduction
In economics, overproduction, oversupply, excess of supply or glut refers to excess of supply over demand of products being offered to the market. This leads to lower prices and/or unsold goods along with the possibility of unemployment.
The d ...
, leading to over to be set aside during times of low commodity prices (1955–1973, 1984–1995). The practice was eventually ended by the
Federal Agriculture Improvement and Reform Act of 1996
The Federal Agriculture Improvement and Reform Act of 1996 (P.L. 104-127), known informally as the Freedom to Farm Act, the FAIR Act, or the 1996 U.S. Farm Bill, was the omnibus 1996 farm bill that, among other provisions, revises and simplifies ...
.
1940-1969: Increased comprehensiveness
Over time, a variety of related topics began to be addressed by agricultural policy:
soil conservation
Soil conservation is the prevention of loss of the topmost layer of the soil from erosion or prevention of reduced fertility caused by over usage, acidification, salinization or other chemical soil contamination.
Slash-and-burn and other uns ...
(1956
Soil Bank Act), surplus crops as
food aid
In international relations, aid (also known as international aid, overseas aid, foreign aid, economic aid or foreign assistance) is – from the perspective of governments – a voluntary transfer of resources from one country to another.
...
(
National School Lunch Act of 1946,
Agricultural Trade Development and Assistance Act of 1954, the 1964
Food Stamp Act).
During this time, agricultural financial support also increased, through raised
price support
In economics, a price support may be either a subsidy, a production quota, or a price control, each with the intended effect of keeping the market price of a good higher than the competitive equilibrium level.
In the case of a price control, a p ...
s, export subsidies, increased
crop insurance
Crop insurance is purchased by agricultural producers, and subsidized by the federal government, to protect against either the loss of their crops due to natural disasters, such as hail, drought, and floods, or the loss of revenue due to declines ...
(1938 Agricultural Adjustment Act), expanding price supports to different crops (
Agricultural Risk Protection Act of 2000
The Agriculture Risk Protection Act of 2000 () made major revisions to the United States' federal crop insurance program and provided emergency agricultural assistance. The crop insurance provisions significantly increased the program's government ...
), offering more guaranteed federal loans, and through the replacement of some price supports with fixed payments (
Food and Agricultural Act of 1962 and Federal Agriculture Improvement and Reform Act of 1996).
Senator
Hubert Humphrey
Hubert Horatio Humphrey Jr. (May 27, 1911 – January 13, 1978) was an American pharmacist and politician who served as the 38th vice president of the United States from 1965 to 1969. He twice served in the United States Senate, representing Mi ...
proposed to use the agricultural surpluses as part of American
foreign aid in 1953. This proposal helped the U.S. address the surplus crops while other states could use their local currencies to trade during the
Cold War.
On the other hand, the failed policies, including the
Brannan Plan in 1949, aimed to solve the agricultural surpluses caused by price supports for farmers by providing "compensatory payments."
Conservatives
Conservatism is a cultural, social, and political philosophy that seeks to promote and to preserve traditional institutions, practices, and values. The central tenets of conservatism may vary in relation to the culture and civilization in ...
were the major forces that opposed this farm bill. The outbreak of the
Korean War
, date = {{Ubl, 25 June 1950 – 27 July 1953 (''de facto'')({{Age in years, months, weeks and days, month1=6, day1=25, year1=1950, month2=7, day2=27, year2=1953), 25 June 1950 – present (''de jure'')({{Age in years, months, weeks a ...
in 1950 also consumed the surpluses that made this farm bill invalid.
1970-1980
Beginning with the administration of Secretary of Agriculture
Henry A. Wallace, the United States had generally moved to curb overproduction. However, in the early 1970s, under Secretary of Agriculture
Earl Butz
Earl Lauer "Rusty" Butz (July 3, 1909 – February 2, 2008) was a United States government official who served as Secretary of Agriculture under Presidents Richard Nixon and Gerald Ford. His policies favored large-scale corporate farming ...
, farmers were encouraged to "get big or get out" and to plant "hedgerow to hedgerow". Over the course of the 20th century, farms have consolidated into larger, more capital-intensive operations and subsidy policy under Butz encouraged these large farms at the expense of small and medium-sized family farms.
The percentage of Americans who live on a farm diminished from nearly 25% during the Great Depression to about 2% now, and only 0.1% of the United States population works full-time on a farm. As the agribusiness lobby grows to near $60 million per year, the interests of agricultural corporations remain highly represented. In recent years, farm subsidies have remained high even in times of record farm profits.
1981-1995
Starting in 1985, several agricultural policies addressed
wetlands and
habitat conservation
Habitat conservation is a management practice that seeks to conserve, protect and restore habitats and prevent species extinction, fragmentation or reduction in range. It is a priority of many groups that cannot be easily characterized in te ...
(
Food Security Act of 1985
The Food Security Act of 1985 (P.L. 99–198, also known as the 1985 U.S. Farm Bill), a 5-year omnibus farm bill, allowed lower commodity price and income supports and established a dairy herd buyout program. This 1985 farm bill made changes in ...
, 1990
Wetlands Reserve Program
The Wetlands Reserve Program (WRP) was a voluntary program offering landowners the opportunity to protect, restore, and enhance wetlands on their property. The USDA Natural Resources Conservation Service (NRCS) administers the program with fundin ...
, 1996
Wildlife Habitat
In ecology, the term habitat summarises the array of resources, physical and biotic factors that are present in an area, such as to support the survival and reproduction of a particular species. A species habitat can be seen as the physical ...
and
Environmental Quality Incentive Program
The Environmental Quality Incentives Program (EQIP) is a United States government program designed to assist farmers in improving environmental quality, particularly water quality and soil conservation. Congress established the program in the 1996 ...
s and 2002
Grassland Reserve Program).
Wetlands Reserve Program (WRP) is a voluntary program implemented by the
U.S. Department of Agriculture (USDA) that USDA may purchase
conservation easements
In the United States, a conservation easement (also called conservation covenant, conservation restriction or conservation servitude) is a power invested in a qualified private land conservation organization (often called a "land trust") or gove ...
from eligible landowners who voluntarily protect wetlands by restoring, maintaining, and improving the hydrologic conditions, native species, and natural topography of the wetlands.
Wildlife Habitat Incentives Program The Wildlife Habitat Incentives Program is a program established by the Federal Agriculture Improvement and Reform Act of 1996 (the Farm Bill) to promote voluntary implementation of on-farm management practices to develop habitat for wetland and up ...
proposed by USDA aimed to respond to the decreasing wildlife species by promoting voluntary farm management practices to protect and maintain habitat for wildlife.
The Grassland Reserve Program (GRP) is a voluntary program proposed by USDA that assisted landowners to improve the grasslands' quality on their property.
Organic Food Production Act of 1990 (
Food, Agriculture, Conservation, and Trade Act of 1990
The Food, Agriculture, Conservation, and Trade (FACT) Act of 1990 — P.L. 101-624 (November 28, 1990) was a 5-year omnibus farm bill that passed Congress and was signed into law.
This bill, also known as the 1990 farm bill, continued to move ag ...
) directs the
Secretary of Agriculture to establish a national organic production certification program; a label for organic products; a national list of approved and prohibited substances for organic productions; and a certifying agency program.
1996: The U.S. Agricultural Policy Reform
In 1996, the U.S. agricultural policy reform started with the
Federal Agriculture Improvement and Reform Act of 1996
The Federal Agriculture Improvement and Reform Act of 1996 (P.L. 104-127), known informally as the Freedom to Farm Act, the FAIR Act, or the 1996 U.S. Farm Bill, was the omnibus 1996 farm bill that, among other provisions, revises and simplifies ...
(1996 Act) that the agricultural market should be determined by the
free market
In economics, a free market is an economic system in which the prices of goods and services are determined by supply and demand expressed by sellers and buyers. Such markets, as modeled, operate without the intervention of government or any ot ...
competition that the government canceled agricultural subsidies and required farmers to enroll in the
Crop Insurance Program.
The U.S. agricultural policy reform was caused by the agricultural and budget pressures combined with the growth in the U.S. economy level and the developments in the agricultural sector.
The Crop Insurance Program was first proposed in the 1930s to assist agriculture recover from the
Great Depression and the
Dust Bowl
The Dust Bowl was a period of severe dust storms that greatly damaged the ecology and agriculture of the American and Canadian prairies during the 1930s. The phenomenon was caused by a combination of both natural factors (severe drought) a ...
.
In 1996, farmers were required to purchase crop insurance or will lost the eligibility to receive other disaster benefits.
Political and economic dynamics
A large reason why agricultural policy has favored farmers over the course of United States history is because farmers tend to have favorable proportional political representation in government. The
United States Senate
The United States Senate is the upper chamber of the United States Congress, with the House of Representatives being the lower chamber. Together they compose the national bicameral legislature of the United States.
The composition and pow ...
tends to grant more power per person to inhabitants of rural states. Also, because the
United States House of Representatives
The United States House of Representatives, often referred to as the House of Representatives, the U.S. House, or simply the House, is the lower chamber of the United States Congress, with the Senate being the upper chamber. Together they ...
is
re-apportioned only every 10 years by the
United States Census, and population tends to shift from rural to urban areas, farmers are often left with greater proportional power until the re-apportionment is complete.
Also, the majority of agricultural policy research is funded by the USDA. Some economists believe this creates an incentive for government intervention because, among other considerations, the USDA will most likely not fund research criticizing its own activities.
[Pasour Jr, E.C. "Intellectual Tyranny of the Status Quo: Agricultural Economists and the State", Econ Journal Watch. (April 2004)]
/ref>
See also
* Agriculture in the United States
Agriculture is a major industry in the United States, which is a net exporter of food. As of the 2017 census of agriculture, there were 2.04 million farms, covering an area of , an average of per farm.
Agriculture in the United States is hig ...
General:
* Buffer initiative
* Politics of the United States
The politics of the United States function within a framework of a constitutional federal republic and presidential system, with three distinct branches that share powers. These are: the U.S. Congress which forms the legislative branch, a b ...
* Food vs fuel
Food versus fuel is the dilemma regarding the risk of diverting farmland or crops for biofuels production to the detriment of the food supply. The biofuel and food price debate involves wide-ranging views, and is a long-standing, controversial ...
* Agricultural subsidy
An agricultural subsidy (also called an agricultural incentive) is a government incentive paid to agribusinesses, agricultural organizations and farms to supplement their income, manage the supply of agricultural commodities, and influence t ...
* Normal crop acreage
* Title 7 of the United States Code
Title 7 of the United States Code outlines the role of agriculture in the United States Code.
Chapters
* : Commodity Exchanges
* : Cotton Standards
* : Grain Standards
* : Naval Stores
* : Importation of Adulterated Seeds
* : Insecticides ...
References
Further reading
*
*
{{United States policy
Agriculture
Agriculture or farming is the practice of cultivating plants and livestock. Agriculture was the key development in the rise of sedentary human civilization, whereby farming of domesticated species created food surpluses that enabled people t ...