The American Farm Policy

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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.

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Farm policy defines a set of laws relating to domestic agriculture and international agricultural imports. Governments generally adopt agricultural policies in order 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.

U.S. agricultural policy, sometimes simply referred to as farm policy generally follows a five-year legislative process that establishes a wide-ranging ‘Farm Bill.’ Farm Bills, or Farm Acts, regulate farming, food and nutrition services and rural communities, as well as bioenergy and forestry aspects. The most recent of all such Farm Bills, the 2018 Agricultural Improvement Act (2018 Farm Bill), authorizes regulations in the aspects of commodity programs and crop insurance, agricultural land protection, agricultural trade (including foreign food aid), nutrition (mainly domestic food aid), farm credit, rural development, agricultural research, state, and private forestry, and horticulture, organic agriculture, and bioenergy.


During the Great Depression, farm bills were first created to provide financial assistance to farmers suffering due to excess crop supply causing low market prices, and also to monitor and ensure adequate food supply.

In 1933, as part of Franklin D. Roosevelt’s New Deal, Congress passed the first farm bill, known as the Agriculture Adjustment Act (AAA). The bill required farmers to receive payment from the U.S. Secretary of Agriculture for not growing food on a percentage of their land. It also allowed the government to purchase excess grain from farmers, which could be sold later if the product output was negatively affected by bad weather or other circumstances. The AAA also included a program of nutrition, it served as the precursor to food stamps.

Congress established a more comprehensive farm bill in 1938 (the 1938 Agricultural Adjustment Act) with an explicit provision to amend it after every five years. The first major structural adjustment to the farm bill was introduced in 1996 when Congress agreed that farm income should be dictated by free-market forces and stopped subsidizing farmland and buying extra wheat. Instead, the government started to require farmers to enroll in a crop insurance program to receive payments from the farm. This led to years of U.S. history’s highest farm subsidies.

In the late 1990s, direct payments also began as a way to support struggling farmers, irrespective of crop output. These payments enabled grain farmers to receive annual government checks based on farm yields and acreage as recorded in the previous decade.

The farm bill was passed in 2008 and was referred to as the Agriculture, Conservation and Energy Act of 2008. The bill contained about $100 billion in annual funding for Agriculture Department services, about 80% of which was dedicated to food stamps and several other nutritional programs.

The 2008 Farm bill increased spending by increasing the budget deficit to $288 billion, causing controversy at the time. It increased subventions for biofuels, which the World Bank named one of three major contributors, together with high fuel prices and price speculation, to the global food price crisis of 2007–2008.

Because of its size and cost, President George Bush vetoed the bill for 2008. Congress, however, nullified the veto. Due to its high cost and the unequal distribution of the subsidy money to farmers, the 2008 bill was also highly contentious. The bill was 47% more costly than the 2003 budget, and 10% of farmers had earned 75% of subsidy dollars over the previous ten years. Some of these farm owners were Congress members at the time as well as other public figures, including former president Jimmy Carter, who received thousands of dollars in direct payments. Approximately 62% of farmers did not receive subsidies from the farm bill in 2007.

The 2018 farm bill or 2018 Agriculture Improvement Act is United States law that reauthorized most expenses in the previous United States farm bill: 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 full range of policy areas it controls, which may vary from Farm Bill to Farm Bill at the moment, depending on policy issues at a particular time. In some cases, new Farm Bills expand, amend, and modify provisions of previous Farm Bills, particularly for the crops, conservation, and rural development programs. In several other cases, new Farm Bill provisions extend, review, and replace terminology in laws that regulate areas that overlap Farm Bill authorities, including food and nutrition, trade, research and extension, food safety, forestry, food safety, organic production, credit, pesticides, and crop insurance.

In all these situations, there are still aspects of existing and relevant laws that are not changed by a new Farm Bill. As a result, certain U.S. food and agriculture management programs and legislation may be governed by laws other than the current Farm Bill.


U.S. Farm Policy and Policy Proce – USDA ERS

Agricultural policy of the United States – Wikipedia

A Short History and Summary of the Farm Bill – Farm Policy Facts

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The American Farm Policy. (2021, Dec 29). Retrieved February 2, 2023 , from

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