The Sauk Centre herald. (Sauk Centre, Stearns County, Minn.) 1886-current, 1934-10-11
THE AGRICULTURAL
ADJUSTMENT PROGRAM
l~xx ~
prepared by O. B. Jesness)
fIrnivepsifv Fary,ol

N44CPaASA ~ ~ LIZ SC6hCS5J
university FARM
The adoption of the agricultural
adjustment program authorized by
the farm act passed in May, 1888,
followed years Of talk about the ag-
ricultural surplus and its effect up
on the economic status Of the farm
er. The expressed objective of the
act is that Of restoring price parity
for agriculture, that is to reestab-
lish q relationship between the
prices of farm products and the
prices of commodities bought by
farmers, corresponding to that ex-
listing during the pre-war period,
1909-14. The act recognizes that
prices for farm products result
from supply and demand relation
ships and aims to adjust the sup
ply so that prices will rise.
Farmers often have been CRITICS
ed for failing to curtail production
of their own accord in line with
demand conditions existing at home
and abroad. Such criticisms reveal
a lack of understanding Of the ag-
ricultural industry. Farming is
characterized by relatively small
producing unit, the individual farm.
A large proportion of the farm
costs consists of relatively fixed
items which continue even though
production is reduced. For ex-
ample, taxes and interest, which
represent an important part of
the cash outlay, go on whether or
not production is curtailed. The
farmer and his family furnish most
If not all of the labor, so there Is
little inducement to curtail opera
lions in order to save labor expense.
The farmer has his fields and herds
to maintain. The output Of the in
dividual farm is too small a frac-
ton of the market supply to have
any noticeable effect on price so
the farmer lacks inducement to cur
tail output in order to raise or
maintain prices. If the individual
cuts production, he lacks assurance
that other farmers will do likewise
to the extent needed to raise prices.
The one who curtails may find him
self in the situation of merely hav-
ing less to sell at the same low
price.
Most other industries curtail out
put when prices are unsatisfactory.
BY so doing, they maintain prices
at relatively better levels than
would be the case were production
continued in full. OF course, in
come is not maintained because
the volume Is less. The adjustment
program aims to help the farmer
do what these other lines are able
to do for themselves. Market out
lets at home have been curtailed
by the depression and outlets for
farm products abroad have been
reduced markedly by trade restric-
tions. There Is no particular pur-
pose served in producing more than
the market is willing to absorb
hence the curtailment program.
Benefit and rental payments are the
inducements provided to make 1t
worth while for farmers to reduce
production. Funds for these pay
ments are obtained mainly from
processing taxes collected from the
professors Of the farm commodi-
ties included.
The program was adopted as a
temporary expedient rather than as
a longtime agricultural plan. It is
impossible to forecast with any
assurance at this particular stage
i,,sf xuhaf narY,o apapf nrs Inn c-tinne
plans, If any, will develop out Of
the present program. There Is,
undoubtedly, much more general
willingness to accept the program
as a temporary expedient than to
regard 1t as suitable for permanent
adoption. This does not mean that
there is not some opposition to 1t
even as temporary plan nor that
there is not some support for the
idea of making it permanent.
It is worthwhile to consider some