The Myth of the Temporary Farm Bill: Thoughts on the Permanent Farm Bill
By Brad Wilson at Oct 28, 2010
During the run up to the 2007-8 farm bill, it was often claimed that the original purpose of the farm bill was as a temporary aid to poor rural people during the Great Depression. But then, they argue, special interests got involved and it kept going on and on. Henry Wallace is sometimes quoted on this matter.
There are a number of arguments against these claims.
- The main provisions of the farm bill as it finally got squared away by the late 1930s were oriented to the management of supply and price, with price floors and supply management on the bottom side, and reserve supplies and price ceilings on the top side. These were mechanisms to address the failure of free markets for agriculture. The main farm program crops lack “price responsiveness on both supply and demand sides. They don’t self correct. The group of main crops from which farmers select (which varies somewhat from one crop region to another, (ie. corn/soybeans vs. cotton, rice, wheat, vs. etc.), as a group, have relatively small degrees of price responsiveness, and it’s relatively slow. The main result is that farm prices are usually too low. So the farm bill was designed to address this problem, which had been a chronic problem in agriculture for decades prior to the first farm bill. This was not a temporary problem. It was not caused by the Great Depression, and it did not end when the Depression ended. It continues to this day, as far as we know. So there has never been a justification for making the farm bill, as originally developed, temporary.
- These provisions of the Commodity Title, (price floors and ceilings, supply reduction and extra reserve supplies,) were reduced 1953-1995 and then eliminated, even though the need for them has never ended. So, in fact, the farm bill was temporary, but the need for it continues to be permanent. As a result of this discrepancy, we’ve had a number of problems. Farm prices have usually been too low, resulting in farmers going broke and a concentration in agriculture. Concentration has relied on labor saving measures, which have been fossil fuel intensive. As fossil fuel prices rise, these farming methods become increasingly unsustainable. Meanwhile livestock, farming’s main value added enterprise worldwide, have been lost from farms, as giant animal factories and feedlots have obtained feeds (feedgrains like corn and protein sources like soybeans,) at far below actual production costs. As a result, farms have had less pasture and hay (they compete with the below cost feeds). This then fosters an oversupply of crops like corn and soybeans, and helps keep prices low, even as demand has grown from increased use as livestock feeds. Without pastures and hay, farms have less diversified crop rotations, so they are less likely to get environmentally safer nitrogen from the air, but instead must buy poorer kinds of nitrogen from ever larger corporations. More herbicides and insecticides are also needed. All of this increases fossil fuel use. Instead of having livestock graze permanent pastures and spread manure as they go, all by their own power (a kind of draft power,) the tilling, planting, spraying, and harvesting and then the manure spreading, is all done by machines, even over the summer. Then we have cheap high fructose corn syrup, soybean transfats, and carbohydrates in general. Meanwhile as crop prices have fallen over the decades, America has usually lost money on farm exports, including the portion of grain that goes into livestock and meat, and various processed products that are exported. These are some of the problems caused by the ending of the original farm bills.
- Meanwhile, we have continued to have a “Permanent Farm Bill,” based upon the 1949 farm bill. While this permanence is sometimes claimed to be a fluke, in fact it is consistent with the logic of the kinds of farm bills and farm programs that were actually implemented, as explained in item #1 above. If congress fails to pass a farm bill on time, USDA could revert back to the permanent legislation. This kind of action is threatened from time to time (see below). That takes us back to a farm bill BEFORE the time when the key provisions of the Commodity Title of the Farm Bill were reduced. At that time the price floors were set at 90% of parity, and achieved crop prices of 100% of parity or more. By way of comparison, as of September 2005, a time when prices were quite low, parity percents for individual crops were: corn: 25%; rice: 26%; cotton: 26%; wheat: 32%; soybeans: 32%. So, on the one hand, livestock systems on diversified family farms were devastated for decades by the reduction in key farm bill provisions. On the other hand, a return to the permanent farm bill would be similarly (but immediately, all at once,) devastating to giant, unsustainable animal factories and feedlots, processors of corn ethanol, high fructose corn syrup, soybean transfats, etc. There are, however, other implications. There are numerous other “titles” of the farm bill, not just the Commodity Title. Many changes have been made since 1949 in nutrition programs, conservation programs, research, food aid, etc. For example, in 2008, for the first time, a livestock (or concentration) title was added. While many of the changes since 1949 are bad, (ie. pro corporate research, EQIP money for animal factories,) many others are good (ie. special programs for organic farming, the livestock title).
- It should also be noted that those arguing that the farm bill was intended to be temporary also tend to convey false information about other farm bill topics, especially about the Commodity Title. They generally do not even know about the main provisions of the Commodity Title of traditional farm bills (price floors & ceilings, supply management, reserves). They often falsely claim that early farm bills had commodity subsidies like today. In fact, commodity subsidies for corn and other feedgrains and wheat did not start until 1961. For cotton they started in 1964, for rice, 1977, for soybeans, 1996.
- One explanation for the claim that political figures once stated that the original New Deal Farm Programs were meant to be temporary, is that such statements served political purposes. They quieted down critics of the programs, as if to say “Don’t worry, we’re trying this for a while, if it doesn’t work, we’ll end it.” The new deal farm programs, as worked out by the late 1930s and early 1940s, did work, and they worked very well when implemented well. If they hadn’t worked well, they would surely have been ended, way back in the 1930s. When they were eventually reduced (1953-1995) and ended (1996), it was not because they did not work, but rather because they did work. Corporate grain, cotton and soybean buyers wanted to obtain these commodities from farmers at very cheap prices, below cost. They lobbied to end the parity programs, and gradually succeeded.
For more information:
Mark Ritchie and Kevin Ristau, Crisis by Design, 1987.
“Corn Growers Welcome Permanent Law,” American Corn Growers Association, 2/4/08.
Dan Looker, “Thinking the Unthinkable: Agriculture Under a 1949 Farm Bill,” Agriculture Online, 1/25/08
Daryll E. Ray, “Agricultural Policy for the 21st Century: The Legacy of the Wallaces,” Fourth Annual Pesek Colloquim Lecture, Iowa State University, 3/3/04.
Chris Clayton, Permanent Laws of 1949 Would Bring Some Complications, DTNAG, 2/1/08
Examples of the claim that the Farm Bill was meant to be temporary and related claims:
Hunger 2007: Healthy Food, Farms and Families, Bread for the World, p. 13 (claims early farm programs had commodity subsidies, etc.), 14 (claims farm bills were meant to be temporary). I can no longer find it online.
Fairness in the Fields: A Vision for the 2007 Farm Bill, Oxfam America, p 14 (claims farm bills were meant to be temporary and that there were commodity subsidies in early farm bills, etc.).
Carolyn Lochhead, "Huge Farm Bill Offers More of Same for Agribusiness," San Francisco Chronicle, 7/27/07.
Search for the word “temporary” in documents here to see examples from the mainstream media.