Farm programs are the cornerstone of the safety net Congress has provided for farmers since the first farm bill, the Agricultural Adjustment Act, was written in 1933. Although many growers have become more market-oriented in recent decades, farm programs have continued to help producers pay off their operating loans and remain in business in times of weather disasters and low prices. Thus, they have provided stability to the U.S. farm economy and enabled American consumers the cheapest and highest quality supply of food and fiber in history.
The first farm programs, which were enacted during the depths of the depression, were designed to reduce the supplies of grain, cotton and meat that began to build up across the United States when demand plummeted at the beginning of the great Depression. The lack of demand meant that farmers received only a small fraction of the prices they had enjoyed during World War I and for a short time in the 1920s. The first farm bill, the Agricultural Adjustment Act, attempted to restore farm prices to a level of parity with farmers received during the period between 1910 and 1914. This term, parity, remained in the legislation until the most recent law, the Food, Conservation and Energy Act of 2008.
Under the parity formula in the early farm bills, farmers could place their crops in storage and request a loan from the government-owned Commodity Credit Corporation in exchange for holding them off the market. The loan rates, which varied by crop, were set high in the early years to help producers pay for input costs and make land payments to stay on their land. In more recent times, Congress has tended to reduce the loan rates to keep crop surpluses from building in response to high loan proceeds.
Over time, the farm bills, which are enacted every four to five years by Congress, have grown to include a number of provisions so much so that the latest farm bills have totaled hundreds of pages and have taken two years or more for the U.S. Department of Agriculture to fully implement. (Observers estimate that 5 percent of the 2008 farm bill provisions have yet to be implemented.) Among the titles in the latest farm bill:
Commodity or farm programs