Through a variety of agricultural, economic, and regulatory programs which support or direct policies related to the production and distribution of food, the United States government has a large influence on how agriculture business is conducted. The government's major impact on agriculture is the setting of prices and mandates regarding how land can be used by farmers that participate in government programs. These policies can also have a large impact on the adoption or use of alternative practices and technologies that may be more efficient and sustainable in the world marketplace.
In the past, farm commodity programs have had a large influence in the past on the kinds and amounts of crops grown as well as on the choice of management practices used to grow them. Prices under government commodity programs have often been above world market prices which meant that many farmers felt compelled to preserve or build their farm commodity program base acres, since acreage determines program eligibility and future income. These programs strongly influenced land-use decisions on about two-thirds of the harvested cropland in the United States.
Price and income support programs for major commodities also influence growers not in the programs. For example, pork producers are not a part of a government program, and in the past they have paid higher feed prices because of high price supports on production of feed grains. At other times, particularly after the Food Security Act of 1985, they benefited from policies resulting in lower food costs. So as the government changes policy in one area, there can be widespread indirect impacts in other areas. For example, the federal dairy termination program, which ran from 1985–1987 was designed to reduce overproduction of milk. Those farmers who sold their milk cows and decided to produce hay for local cash markets caused a steep decline in the prices received by other established hay producers.
Federal policy evolved as a patchwork of individual programs, each created to address individual problems. There was not a coherent strategy to direct programs toward a common set of goals. Many programs such as soil conservation and export programs have had conflicting objectives, but attempts have now been made in the most current farm legislation to address some of these problems.
Government food policy has produced a wide variety of results. The policy has not only affected commodity prices and the level of output, but it has also shaped technological change, encouraged uneconomical capital investments in machinery and facilities, inflated the value of land, subsidized crop production practices that have led to resource degradation (such as soil erosion and surface and groundwater pollution ), expanded the interstate highway system, financed irrigation projects, and promoted farm commodity exports. Together with other economic forces, government policy has had a far-reaching structural influence on agriculture, much of it unintended and unanticipated.
Federal commodity programs were put into place beginning in the 1930s, primarily with the Agriculture Adjustment Act of 1938. The purpose of these programs born out of the Depression was primarily to protect crop prices and farmer income which has been done by a number of programs over the years. A variety of methods have been used including setting prices, making direct payments to farmers, and subsidizing exports. However, by the mid-1980s and early 1990s, an increasing number of people felt that these programs impeded movement toward alternative types of agriculture, to the detriment of family farms and society in general.
Two components in particular were highlighted as being problems: base acre requirements and cross-compliance. All crop price and income support programs relied on the concept of an acreage base planted with a given commodity that would produce a predictable yield. Most of this acreage was planted to maximize benefits and was based on a five-year average. A farmer knew that if he/she reduced their acres for a given crop, they would not only lose the current year's benefits, but would also lose future benefits.
Cross-compliance was instituted in the Food Security Act of 1985. It was designed to control government payments and production by attaching financial penalties to the expansion of program crop base acres. It served as an effective financial barrier to diversification of crops by stipulating that to receive any benefits from an established crop acreage base, the farmer must not exceed his or her acreage base for any other program crop. This had a profound impact on farmers and crop growers since about 70% of the United States' cropland acres were enrolled in the programs.
In addition to citing these problem areas, critics of food policy programs argued that many farmers faced economic penalties for adopting beneficial practices such as crop rotation or strip cropping, practices that in general reduce soil erosion and improve environmental quality. The economic incentives built into commodity programs, for example, encouraged heavier use of fertilizer , pesticides, and irrigation. These programs also encouraged surplus production, subsidized inefficient use of inputs, and they resulted in increased government expenditures. Critics argued that the rules associated with these programs discouraged farmers from pursuing alternative practices or crops, or technologies that might have proved more effective in the long term or that were more environmentally friendly.
Critics also contend that much of the research conducted over the past 40 years has responded to the needs of farmers operating under a set of economic and policy incentives that encouraged high yields without regard to the long-term environmental impacts. During the late 1980s and early 1990s, several U.S. Department of Agriculture research and education programs were instituted to determine whether current levels of production can be maintained with reduced levels of fertilizers and pesticides, to examine more intensive management practices, to increase understanding of biological principles, and to improve profitability per unit of production with less government support. As the impacts of the alternative production systems on the environment are evaluated, it will be important to have policies in place that will allow the farmer to easily adopt those practices that increase efficiency and reduce impacts. In a farm bill passed in 1996 there are provisions that change these commodity programs. Labeled the "right to farm provisions," these allow farmers to make decisions on what they grow and establish a phased seven-year reduction in price supports.
Food quality and safety are major concerns addressed as a part of federal policy. Programs addressing these concerns are primarily designed to prevent health risks and acute illnesses from chemical and microbial contaminants in food. Supporters say that this has provided the country with the safest food supply in the world. However, critics contend that a number of regulations do not enhance quality or safety and put farmers that use or would adopt alternative agricultural practices at a disadvantage. Several examples can be cited. Critics of government food policy point out that until recently, meat grading standards awarded producers of fatty beef which has been linked to the increased likelihood of heart disease.
The use of pesticides provides another example. The Environmental Protection Agency establishes pesticide residual tolerance levels in food which are monitored for compliance. For some types of risk, cancer in particular, there is a great deal of uncertainty, and critics point out which cosmetic standards that increase prices for fruits and vegetables may encourage higher risks of disease among consumers. Also, certain poultry slaughter practices can result in microbiological contamination. Of particular concern is salmonella food poisoning which has become widespread.
Government food policy heavily influences on-farm decision making. In some cases one part of the policy has negative or unintended consequences for another policy or segment of farmers. As we look to the future, the struggle will be to continue to provide a coherent, coordinated policy. The recent changes in policy will need to be evaluated from the standpoint of sustainability and environmental impacts.
[James L. Anderson ]
Agriculture and the Environment. The 1991 Yearbook of Agriculture. U.S. Government Printing Office. Washington, D.C.
Alternative Agriculture. Board on Agriculture, National Research Council., Washington, DC: National Academy Press, 1989.