Agricultural Adjustment Act

Definition

The Agricultural Adjustment Act (AAA) was a New Deal legislation enacted in 1933 aimed at boosting agricultural prices by reducing surpluses. It sought to stabilize the economy during the Great Depression by paying farmers to cut production of certain crops, thereby increasing scarcity and raising prices. The act reflected the urgent need for economic recovery and significantly influenced both agricultural policy and social conditions in the United States.

5 Must Know Facts For Your Next Test

1. The AAA was part of President Franklin D. Roosevelt's New Deal strategy to recover from the Great Depression and was one of the first efforts to manage agricultural production at a national level.
2. The act initially targeted major commodities like cotton, wheat, corn, and dairy, offering payments to farmers who agreed to reduce their crop acreage or livestock numbers.
3. While the AAA helped raise farm incomes and stabilize prices, it faced criticism for favoring larger farms over smaller ones, leading to significant social disparities in rural areas.
4. The Supreme Court declared a key provision of the AAA unconstitutional in 1936, which led to its eventual replacement with other agricultural policies in subsequent years.
5. The AAA set a precedent for future government intervention in agriculture, influencing policies aimed at maintaining price stability and supporting farmers through various forms of assistance.

Review Questions

• How did the Agricultural Adjustment Act aim to alleviate economic distress during the Great Depression?
  • The Agricultural Adjustment Act sought to alleviate economic distress during the Great Depression by reducing agricultural surpluses and increasing commodity prices. By paying farmers to limit production of certain crops and livestock, the AAA aimed to create scarcity that would drive prices up. This was crucial for stabilizing farm incomes, which were severely impacted by falling prices and economic instability during that era.
• What were some of the criticisms surrounding the implementation of the Agricultural Adjustment Act, especially concerning its impact on small farmers?
  • Critics of the Agricultural Adjustment Act pointed out that it often favored larger farms over smaller ones, as only those who could afford to reduce their production were eligible for payments. This created inequalities in rural communities, as many small farmers struggled to survive while larger agricultural operations benefited from government support. Additionally, the act led to the eviction of some tenant farmers and sharecroppers who were not included in compensation plans.
• Evaluate the long-term effects of the Agricultural Adjustment Act on American agriculture and its influence on future agricultural policy.
  • The long-term effects of the Agricultural Adjustment Act shaped American agriculture significantly by establishing a precedent for federal involvement in agricultural markets. It introduced concepts like price supports and farm subsidies that have continued into modern policies. The act's legacy influenced later programs aimed at stabilizing agriculture during economic downturns and addressing issues like rural poverty and food security, highlighting an ongoing governmental role in managing agricultural economics.

Related terms

New Deal: A series of programs and policies implemented by President Franklin D. Roosevelt to combat the Great Depression, focusing on relief, recovery, and reform.

Dust Bowl: A severe drought during the 1930s that devastated farmland in the Great Plains, leading to widespread agricultural failure and displacement of farming families.

Subsidies: Financial assistance provided by the government to support specific industries or economic activities, often used to encourage production or stabilize prices.