On This Day: Govt pays farmers not to farm, destroy crops, cull animals during depression, shocking many - May 12, 1933

(edited from article)
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AGRICULTURAL ADJUSTMENT ACT

As a means of bringing direct and effective help to farmers, the law sought to reduce production of the huge agricultural surpluses that depressed market prices. The AAA provided for cash benefit payments for cutting the production of seven major farm commodities. The most important of these for Oklahoma farmers were payments to cut wheat and cotton acreage and to reduce hog numbers. In addition to the higher prices that might follow reduced production, farmers who cooperated with the program and signed the required contracts received cash in the form of so-called "benefit payments." At first, money for these payments to farmers came from special taxes on food processors, and later, after that portion of the law was declared unconstitutional in 1936, from the federal treasury.

Because Oklahoma cotton farmers had already planted their crop before the AAA became law, they had to plow up a portion of the growing cotton to qualify for benefit payments. Some farmers and farm leaders strongly objected to destroying such an important and useful crop as cotton. John A. Simpson, a prominent Oklahoma farm leader and president of the National Farmers' Union, was among the severest critics of acreage and production controls. However, 87,794 Oklahoma cotton farmers signed contracts with the U.S. Department of Agriculture and plowed under the required acres to qualify for payments that amounted to $15,792,287 in 1933.

Under the corn-hog program Oklahoma farmers received $4,058,000 in 1934 in return for reducing hog numbers. This program, which involved killing brood sows and little pigs, brought cries of protest from many critics. However, the useable meat was distributed through the Federal Emergency Relief Administration. A similar cattle-purchasing program was also important to Oklahoma farmers.

Tens of millions of dollars were distributed to Oklahoma farmers who participated in AAA programs between 1933 and 1936 when a major part of the law was declared unconstitutional. Prices rose and production and market needs were in better balance. Yet, thousands of Oklahoma farmers still struggled to survive. The benefit payments did not bring much help to farmers on small acreages, and many of these families with only a few acres eventually left the farm and sought opportunities elsewhere. The AAA was important, however, because it set a pattern for making direct payments to farmers under a wide variety of programs during the remainder of the twentieth century.
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https://www.okhistory.org/publications/enc/entry?entry=AG002

(edited from Wikipedia)
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[AAA and the New Deal]

The Agricultural Adjustment Act (AAA) [signed on May 12, 1933] was a United States federal law of the New Deal era designed to boost agricultural prices by reducing surpluses. The government bought livestock for slaughter and paid farmers subsidies not to plant on part of their land. The money for these subsidies was generated through an exclusive tax on companies that processed farm products. The Act created a new agency, the Agricultural Adjustment Administration, also called "AAA" (1933–1942), an agency of the U.S. Department of Agriculture, to oversee the distribution of the subsidies. The Agriculture Marketing Act, which established the Federal Farm Board in 1929, was seen as an important precursor to this act. The AAA, along with other New Deal programs, represented the federal government's first substantial effort to address economic welfare in the United States.

Background

When President Franklin D. Roosevelt took office in March 1933, the United States was in the midst of the Great Depression. "Farmers faced the most severe economic situation and lowest agricultural prices since the 1890s." "Overproduction and a shrinking international market had driven down agricultural prices." Soon after his inauguration, Roosevelt called the Hundred Days Congress into session to address the crumbling economy. From this Congress came the Agricultural Adjustment Administration, to replace the Federal Farm Board. The Roosevelt Administration was tasked with decreasing agricultural surpluses. Wheat, cotton, field corn, hogs, rice, tobacco, and milk and its products were designated as basic commodities in the original legislation. Subsequent amendments in 1934 and 1935 expanded the list of basic commodities to include rye, flax, barley, grain sorghum, cattle, peanuts, sugar beets, sugar cane, and potatoes.

[Many shocked]

The juxtaposition of huge agricultural surpluses and the many deaths due to insufficient food shocked many, as well as some of the administrative decisions that happened under the Agricultural Adjustment Act. For example, in an effort to reduce agricultural surpluses, the government paid farmers to reduce crop production and to sell pregnant sows as well as young pigs. Oranges were being soaked with kerosene to prevent their consumption and corn was being burned as fuel because it was so cheap.

There were many people, however, as well as livestock in different places starving to death. Farmers slaughtered livestock because feed prices were rising, and they could not afford to feed their own animals. Under the Agricultural Adjustment Act, "plowing under" of pigs was also common to prevent them reaching a reproductive age, as well as donating pigs to the Red Cross.

In 1935, the income generated by farms was 50 percent higher than it was in 1932, which was partly due to farm programs such as the AAA.

[Tenant farmers and small farmers]

Tenant farming characterized the cotton and tobacco production in the post-Civil War South. As the agricultural economy plummeted in the early 1930s, all farmers were badly hurt but the tenant farmers and sharecroppers experienced the worst of it.

Although the Act stimulated American agriculture, it was not without its faults. For example, it disproportionately benefited large farmers and food processors, with lesser benefits to small farmers and sharecroppers. With the spread of cotton-picking machinery after 1945, there was an exodus of small farmers and croppers to the city.

Ruled unconstitutional

On January 6, 1936, the Supreme Court decided in United States v. Butler that the act was unconstitutional for levying this tax on the processors only to have it paid back to the farmers. Regulation of agriculture was deemed a state power. As such, the federal government could not force states to adopt the Agricultural Adjustment Act due to lack of jurisdiction. However, the Agricultural Adjustment Act of 1938 remedied these technical issues and the farm program continued.
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https://en.wikipedia.org/wiki/Agricultural_Adjustment_Act

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