The U.S. is one of the world’s largest agricultural producers. It also has a very huge domestic market and is the biggest exporter of agricultural products in the world. Nevertheless, the share of exported U.S. agricultural production is more than double of any other U.S. sector, and the trade surplus of agricultural products serves as a significant boost for the U.S. economy. Therefore, U.S. agricultural policies have a great influence on global agricultural markets. Farm policies can be extremely controversial and can affect international trade, environmental protection, food safety, and rural communities ‘ well-being.
Farm policy defines a set of laws relating to domestic agriculture and international agricultural imports. Governments generally adopt agricultural policies to achieve a specific outcome in the markets for domestic agricultural products. Since America’s initial economy was almost entirely agrarian, almost all of the early economic and trade policy was primarily on agricultural policy.
American agricultural policy, sometimes simply referred to as farm policy normally goes through a five-year legislative process that establishes a vast “Farm Bill.” Farm Policies regulate farming, food, nutrition, and rural communities, also including forestry and bioenergy aspects. The most current of all such Farm Policies, the 2018 Agriculture Improvement Act (2018 Farm Policy), authorized regulations in the aspects of agricultural programs and also crop insurance, agricultural land protection, agricultural trade (as well as foreign food aid), nutrition (mainly domestic food aid), rural development, farm credit, agricultural research, private and State forestry, and horticulture, organic agriculture, and bioenergy.
Farm policies were first developed during the period of the Great Depression to provide financial aid to farmers suffering from surplus plant production resulting in low market prices, as well as to track and maintain the proper food supply.
In 1933, Congress passed the first policy, established as the Agriculture Adjustment Act (AAA), as part of the New Deal under Franklin D. Roosevelt. The bill required farmers to be paid by the U.S. Agriculture Secretary for failing to grow food on a portion of their land. It also made provisions that the government could buy large amounts of grain from farm owners, which would later be sold in the event of abrupt weather conditions or if any other circumstances had adversely affected the product output. Also included by the AAA was a nutrition program, which acted as a predecessor to food stamps.
Congress established a more comprehensive farm bill in 1938 (the 1938 Adjustment Act for Agricultural) with an explicit provision to amend it after five years. The first key structural adjustment to the farm policy was introduced in 1996 when Congress agreed that farm income should be dictated by the free-market forces and ceased subsidizing farmlands and purchasing extra wheat. The government instead started to require farmers to subscribe to a program bordering on crop insurance to receive payments from the farm. This resulted in years of U.S. history’s largest farm subsidies.
In the late 1990s, direct payments were also started as an avenue of supporting struggling farmers, irrespective of output or production. These payments enabled those farming grain to receive annual government checks based on farm yields as recorded in the preceding decade.
The farm policy was passed in 2008 and was referred to as the Agriculture, Conservation and Energy Act of 2008. The policy contained about $100 billion in annual funding for Agriculture Department services, and about 80% was dedicated to nutritional programs and food stamps.
The 2008 Farm policy increased spending by increasing the budget deficit to $288 billion, which caused controversy at that time. It increased subventions, especially for biofuels, which was named as one of three major contributors by the World Bank, together with soaring fuel prices and speculations, to the global crisis of food prices around 2007–2008.
Because of its size and cost, Pres. George Bush vetoed the bill in 2008. Congress, however, nullified the veto. Because of the high cost and unequal distribution of the subsidy money to farmers, the 2008 policy was also highly contentious. The policy was 47% more costly than that of 2003, and 10% of farmers earned 75% in subsidy dollars over the previous ten years. A few of these farmers were Congress members at the time as well as other public personalities, including Jimmy Carter, a former president, all of who received direct payments of several thousand dollars. Approximately 62% of farmers did not get subsidies from the policy in 2007.
The 2018 farm policy or 2018 Agriculture Improvement Act is a United States law that reauthorized most expenses in the previous United States farm policy: the 2014 Agricultural Act. On December 11, 2018, the Senate passed the $867 billion reconciled farm policy, and on December 12th, the House passed it. It received the signing of President Donald Trump on December 20th, 2018 and became law.
The farm policy in the United States is the federal government’s primary agriculture and food management device.
The United States continues to maintain a range of agricultural policies with goals including everything from traditional goals of stabilizing agricultural output and continuing to support farm income for those more recently gaining in importance, such as ensuring adequate nutrition, ensuring food safety, promoting environmental protection, and fostering rural development.
The United States Farm Policy amends existing legislation across a vast range of areas it controls, which may vary from Bill to Bill at the moment, depending on policy issues at a particular moment. In some situations, new Farm Policies expand, amend, and modify provisions of former Farm Policies, particularly for the crops, conservation, and rural development programs. In several other cases, new Farm Policy provisions extend, review, and replace terminology in laws that regulate areas overlapping Farm Policy authorities, including food/nutrition, trade, research, extension, food safety, forestry, organic production, credit, pesticides, and also crop insurance.
In these situations, there are still aspects of existing and relevant laws that are not changed by a new Farm Policy. Consequently, certain U.S. agriculture and food policy programs and legislation may be regulated by laws that may differ from the current Farm Policy.