Agricultural Policy in the United States: Evolution and Economics PDF
Preview Agricultural Policy in the United States: Evolution and Economics
i Agricultural Policy in the United States Agricultural Policy in the United States: Evolution and Economics traces U.S. agricul- tural policy from its colonial roots to the present, using economic concepts to analyze and interpret political and economic consequences. It also examines the processes by which agricultural policies are developed, and the government structure which supports the implementation of legislation passed by Congress. The book includes arguments for and against common tools of U.S. agricultural policy, without influencing the reader in a particular direction. Each chapter contains questions and exercises to support students’ learning, and technical economic material is contained in optional appen- dices. This second edition includes the Agriculture Improvement Act of 2018 and sets the scene for future policy developments. Additionally, it looks at trade wars and the impact of Black Swan events like the COVID- 19 pandemic on agricultural resilience. James L. Novak is Professor Emeritus in the Department of Agricultural Economics and Rural Sociology, Auburn University, Auburn, Alabama, USA. Larry D. Sanders is Professor Emeritus in the Department of Agricultural Economics, Oklahoma State University, Stillwater, Oklahoma, USA. Amy D. Hagerman is Assistant Professor and Agricultural and Food Policy Specialist in the Department of Agricultural Economics, Oklahoma State University, Stillwater, Oklahoma, USA. ii Routledge Textbooks in Environmental and Agricultural Economics Principles of Agricultural Economics Andrew Barkley and Paul W. Barkley An Introduction to Climate Change Economics and Policy Felix R. FitzRoy and Elissaios Papyrakis Environmental Economics Shunsuke Managi and Koichi Kuriyama Energy Economics Peter M. Schwarz US Agricultural and Food Policies Economic Choices and Consequences Gerald D. Toland, Jr., William Nganje, and Raphael Onyeaghala Global Food Security What Matters? Zhang- Yue Zhou Economics of Agricultural Development World Food Systems and Resource Use George W. Norton, Jeffrey Alwang, and William A. Masters The Economics of Farm Management A Global Perspective Kent Olson and John Westra Agricultural Policy in the United States Evolution and Economics James L. Novak, Larry D. Sanders, and Amy D. Hagerman For more information about this series, please visit: www.routledge.com/ Routledge- Textbooks- in- Environmental- and- Agricultural- Economics/ book- series/ TEAE iii Agricultural Policy in the United States Evolution and Economics Second Edition James L. Novak, Larry D. Sanders, and Amy D. Hagerman iv Cover image: © rarrarorro / Getty Images Second edition published 2022 by Routledge 4 Park Square, Milton Park, Abingdon, Oxon, OX14 4RN and by Routledge 605 Third Avenue, New York, NY 10158 Routledge is an imprint of the Taylor & Francis Group, an informa business © 2022 James L. Novak, Larry D. Sanders, and Amy D. Hagerman The right of James L. Novak, Larry D. Sanders, and Amy D. Hagerman to be identified as authors of this work has been asserted in accordance with sections 77 and 78 of the Copyright, Designs and Patents Act 1988. All rights reserved. No part of this book may be reprinted or reproduced or utilised in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers. Trademark notice: Product or corporate names may be trademarks or registered trademarks, and are used only for identification and explanation without intent to infringe. First edition published by Routledge 2015 British Library Cataloguing- in- Publication Data A catalogue record for this book is available from the British Library Library of Congress Cataloging- in- Publication Data Names: Novak, James L., author. | Sanders, Larry D., author. | Hagerman, Amy D., author. Title: Agricultural policy in the United States : evolution and economics / James L. Novak, Larry D. Sanders and Amy D. Hagerman. Description: Second edition. | Abingdon, Oxon ; New York, NY : Routledge, 2022. | Series: Routledge textbooks in environmental and agricultural economics | Includes bibliographical references and index. Identifiers: LCCN 2022000477 (print) | LCCN 2022000478 (ebook) | ISBN 9781032133799 (pbk) | ISBN 9781032135502 (hbk) | ISBN 9781003229780 (ebk) Subjects: LCSH: Agriculture and state–United States. | Agriculture–Economic aspects–United States. | Agricultural laws and legislation–United States. Classification: LCC HD1761 .N63 2022 (print) | LCC HD1761 (ebook) | DDC 338.1/873–dc23 LC record available at https://lccn.loc.gov/2022000477 LC ebook record available at https://lccn.loc.gov/2022000478 ISBN: 978- 1- 032- 13550- 2 (hbk) ISBN: 978- 1- 032- 13379- 9 (pbk) ISBN: 978- 1- 003- 22978- 0 (ebk) DOI: 10.4324/ 9781003229780 Typeset in Times New Roman by Newgen Publishing UK v Contents Preface vii Acknowledgment ix 1 Introduction: What Is Agricultural Policy and Why Does It Exist? 1 2 Economic Concepts Applied to Agricultural and Food Policy 10 3 Who Makes Agricultural Policy and How Is It Made? 32 4 A Brief History and the Evolution of Agricultural Policy 43 5 Early Twentieth- Century Agricultural Legislation 53 6 McNary- Haugen and the Permanent Legislation to the 1950s 60 7 The 1960s to Mid- 1980s: Transition and Farm Crises 79 8 Planting Flexibility and Direct Payments, 1985– 1996 98 9 Twenty- First- Century Agricultural Legislation 123 10 International Trade: Is It the Future of U.S. Agricultural Policy? 156 11 Agricultural Policy Since 2014 173 12 The Future of Agricultural Policy: A Policy Shift to Risk Management 190 Index 207 vi vii Preface The purpose for this book is to present the evolution of past government policies which has resulted in today’s legislation affecting U.S. agriculture and the consumers of U.S. agricultural commodities. As background, the processes by which agricultural policies are developed by Congress are presented. In each of the chapters economic principles are used to analyze the evolution of implemented agricultural legislation. Agricultural public policy is defined by Knutson et al. (2004) as “…a guiding prin- ciple leading to a course of action or specific program that is pursued by the govern- ment.” Halcrow et al. (1994) defines it as “…a deliberate course of action…chosen and followed by a public body, private firm, family or individual.” In 1805, Sir James Steuart presented a concise and pragmatic approach to govern- ment policy in general with the statement: The best way to govern a society, and to engage everyone to conduct himself according to a plan, is for the statesman to form a system of administration, the most consistent possible with the interest of every individual, and never to flatter himself that his people will be brought to act in general, and in matters which purely regard the public, from any other principle than private interest. The evolution of U.S. agricultural, food, conservation, and rural policies has basically followed Steuart’s description. Agricultural policy is made through the actions of three major actors. These actors include those directly involved with the producing, processing, and selling of food and fiber and those not directly involved in production. Those not directly involved in production agriculture include most of the legislators who pass laws related to food and fiber. The production of agricultural policies by Congress can be a slow-m oving response to constituent demand or “Black Swan” events can occur, forcing immediate policy responses by Congress that range from modest renovations in current policies to the complete replacement of those policies.1 Chapter 1 defines agricultural policy. Chapter 2 might be characterized as Economics 100 applied to analyzing agricultural policies. Subsequent chapters include an over- view of the policy- making process, arguments for and against an agricultural policy, and an overview of the evolution of agricultural policies from ancient times to today. International trade issues are briefly discussed, given its importance to agriculture and increasing globalization of trade. Discussion of the effects of current “Black Swan” events and legislative responses, including the 2018 farm bill, are featured in the final chapters. viii viii Preface A glossary and overview of agricultural definitions and programs can be found in a 2005 report by Jasper Womach of the Congressional Research Service (CRS). Note 1 According to Taleb, “Black Swans” are unpredictable events that negatively impact markets, causing investment losses. A loss of faith resulting from such events can increase the vulner- ability to future Black Swans. References Halcrow, Harold G., Robert G.F. Spitze, and Joyce E. Allen-S mith. 1994. Food and Agricultural Policy, Economics and Politics. McGraw Hill Inc. Hanson, John Mark. 1991. “Gaining Access” Congress and the Farm Lobby 1919–1 981. The University of Chicago Press. Knutson, Ronald D., J.B. Penn, Barry L. Flinchbaugh. 2004. Agricultural and Food Policy, 5th edition. Pearson, Prentice Hall. Steuart, Sir James. 1954. “‘On Government Regulation’: From an Inquiry into the Principles of Political Economy,” in Philip C. Newman, Arthur D. Gayer, and Milton H. Spencer (eds.), Source Readings in Economic Thought. W.W. Norton and Company Inc. Taleb, Nassim Nicholas. 2010. The Black Swan: The Impact of the Highly Improbable. Random House. Womach, Jasper. 2005. Agriculture: A Glossary of Terms, Programs, and Laws, 2005 Edition. Congressional Research Service Report. Available online: http:// ftp.ncs eonl ine.org/ nle/ crs repo rts/ 05jun/ 97- 905.pdf. newgenixprepdf Acknowledgment While we were completing this second edition, a dear friend and colleague, William “Fred” Woods passed from this plane of existence. Fred was our policy mentor and guide in Washington D.C. A policy giant in the United States Department of Agriculture, Fred made sure when we visited the Nations’ Capital we walked through the right doors. Fred had access to the right people in the Capital and was with us at every stop. He lived and breathed public policy and was influential in its development and in educating Extension policy specialists, farmers, and farm commodity organization leaders nation- wide. Whatever lies on the “other side” it has gained a Southern gentleman, storyteller, and educator. We dedicate this book to you W. Fred Woods.
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