Agricultural Adjustment Act of 1935

I did some poking around this morning after getting curious about the comment Hot Chocolate made to my last post.

When the Agricultural Adjustment Act was proposed, it operated on the primary assumption that if fewer farm products were produced, it would actually lead farmers to receive higher prices for their crops.  It's a reasonable assumption.  After all, vast tracts of land in this country are almost magically fertile and produce an abundance of food.  What this assumption fails to take into consideration is that, as in many countries with highly productive lands, the issue is not supply and demand.  The issue is transportation to markets that actually *need* what the farms produce.  This is why we have chronic oversupplies of food stuffs and yet still have children and families who are malnourished for lack of access to wholesome food.

The AAA proposed cutting production to increase prices.  One of the ways the bill did this is still with us today in the form of a program that has helped increase the fertility of land; farmers receive a subsidy for allowing a certain percentage of their land to lie fallow, that is unplanted and unused even as pasture land, each year.  By letting land rest, it is able to replenish minerals drawn out by our typical farm crops and restore itself.  A good thing, right?  A program that lets farmers do the right thing for their land without penalizing them for it.

The more controversial part of the bill is what Hot Chocolate referred to.  In the 1920's and 30's, cotton production was at an all time high.  Pork prices at the consumer end were at an all time low.  For these two products, and these two only, the AAA of 1935 (there was an earlier AAA that was stricken down as unconstitutional) encouraged farmers to produce less.  Cotton farmers were encouraged to plow under a quarter of their total crop.  Pig farmers were encouraged to slaughter a percentage of their herds.  For these efforts, the farmers received a subsidy.  Trickle down economics worked also; as less cotton and pork made its way to market, the consumers paid more which meant the suppliers paid farmers more.  Not much more but it did help.  The Agricultural Adjustment Act ONLY affected cotton and pork.  NO other food stuffs were subsidized by asking farmers to produce less.