The New Deal- Helping Farmers- Agricultural Adjustment Administration (AAA) May 1933

The New Deal- Helping Farmers- Agricultural Adjustment Administration (AAA) May 1933

1. Under the leadership of Secretary of Agriculture, Henry A. Wallace, the AAA laid foundations for modern farming policy

2. Throughout the 1920s, farming had been in crisis

   • overproduction had resulted in low farm prices

3. the Act that created the AAA gave Wallace the power to deal with farm problems

4. the AAA helped to reduce supply and to stabilise farm prices

5. based on a 'domestic allotment' plan

   • farmers agreed either to reduce the area they cultivated or reduce production
     • reduction in crop yields was also aided by drought in 1933
   • plan affected major commodities such as wheat, cotton, pigs, corn and milk
     • thousands of piglets were slaughtered, milk was poured away and crops were ploughed up

6. by 1935, over 75 million acres (30 million hectacres) had been removed from cultivation

   • farm incomes rose from $4.5 billion in 1933 to $6.9 billion in 1935
     • federal payments greatly aided farmers
       • but, with a reduction in production less farm labourers, such as sharecroppers and migrant workers, were needed
         • took the Resettlement Administration of 1935 to deal with this problem

7. for all of its benefits, the US Supreme Court declared the AAA unconstitutional (Jan 1936) in the case of 'US versus Butler'

   • it took another Agricultural Adjustment Act of 1938 to restore many features of the first act
     • however, benefits farmers had received in the New Deal weren't solely the result of the AAA
       • Farm Credit Administration also very important