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Agricultural Adjustment Administration facts, information, pictures | Encyclopedia.com articles about Agricultural Adjustment Administration

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Agricultural Adjustment Administration (AAA), former U.S. government agency established (1933) in the Dept. of Agriculture under the Agricultural Adjustment Act of 1933 as part of Franklin Delano Roosevelt's New Deal program. Its purpose was to help farmers by reducing production of staple crops, thus raising farm prices and encouraging more diversified farming. Farmers were given benefit payments in return for limiting acreage given to staple crops in the case of cotton and tobacco coercive taxes forced (1934-35) farmers to cut the amounts that they marketed. In 1936 the Supreme Court declared important sections of the act invalid, but Congress promptly adopted (1936) the Soil Conservation and Domestic Allotment Act, which encouraged conservation by paying benefits for planting soil-building crops instead of staple crops. The Agricultural Adjustment Act of 1938 empowered the AAA in years of good crops to make loans to farmers on staple crop yields and to store the surplus produce, which it could then release in years of low yield. Soil conservation was continued, and farmers could by two-thirds vote adopt compulsory marketing quotas (as they did for cotton and tobacco). In World War II the AAA turned its attention to increasing food production to meet war needs. It was renamed (1942) the Agricultural Adjustment Agency, and in 1945 its functions were taken over by the Production and Marketing Administration.
See E. G. Nourse et al., Three Years of the Agricultural Adjustment Administration (1937, repr. 1971) G. V. L. Perkins, Crisis in Agriculture (1969).

The Columbia Electronic Encyclopedia, 6th ed. Copyright © 2012, Columbia University Press. All rights reserved.

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Agricultural Adjustment Administration (AAA), former U.S. government agency established (1933) in the Dept. of Agriculture under the Agricultural Adjustment Act of 1933 as part of Franklin Delano Roosevelt's New Deal program. Its purpose was to help farmers by reducing production of staple crops, thus raising farm prices and encouraging more diversified farming.

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World War I severely disrupted agriculture in Europe. That was an advantage to farmers in the United States, who increased production dramatically and were therefore able to export surplus food to European countries. But by the 1920s, European agriculture had recovered and American farmers found it more difficult to find export markets for their products. Farmers continued to produce more food than could be consumed, and prices began to fall.

The decline in demand for agricultural products meant that many farmers had difficulty paying the mortgages on their farms. By the 1930s, many American farmers were in serious financial difficulty.

In South Dakota, the county grain elevators listed corn as minus three cents a bushel — if a farmer wanted to sell them a bushel of corn, he had to bring in three cents. Fields of cotton lay unpicked, because it couldn`t be sold even for the price of picking. Orchards of olive trees hung full of rotting fruit. Oranges were being sold at less than the cost of production. Grain was being burned instead of coal because it was cheaper.

When Franklin D. Roosevelt was inaugurated president in 1933, he called Congress into special session to introduce a record number of legislative proposals under what he dubbed the New Deal. One of the first to be introduced and enacted was the Agricultural Adjustment Act. The intent of the AAA was to restore the purchasing power of American farmers to pre-World War I levels. The money to pay the farmers for cutting back production by about 30 percent was raised by a tax on companies that bought farm products and processed them into food and clothing.

The AAA evened the balance of supply and demand for farm commodities so that prices would support a decent purchasing power for farmers. This concept was known as "parity."

AAA controlled the supply of seven "basic crops" — corn, wheat, cotton, rice, peanuts, tobacco, and milk — by offering payments to farmers in return for farmers not planting those crops.

The AAA also became involved in assisting farmers ruined by the advent of the Dust Bowl in 1934.

In 1936 the Supreme Court, ruling in United States v. Butler, declared the AAA unconstitutional. Writing for the majority, Justice Owen Roberts stated that by regulating agriculture, the federal government was invading areas of jurisdiction reserved by the constitution to the states, and thus violated the Tenth Amendment. Judge Harlan Stone responded for the minority that, "Courts are not the only agency of government that must be assumed to have capacity to govern."

Further legislation by Congress restored some of the act`s provisions, encouraging conservation, maintaining balanced prices, and establishing food reserves for periods of shortages.

Congress also adopted the Soil Conservation and Domestic Allotment Act, which encouraged conservation by paying benefits for planting soil-building crops instead of staple crops. The rewritten statutes were declared constitutional by the Supreme Court in Mulford v. Smith (1939) and Wickard v. Filburn (1942).

During World War II, the AAA turned its attention to increasing food production to meet war needs. The AAA did not end the Great Depression and drought, but the legislation remained the basis for all farm programs in the following 70 years.

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World War I severely disrupted agriculture in Europe. That was an advantage to farmers in the United States, who increased production dramatically and were therefore able to export surplus food to European countries. But by the 1920s, European agriculture had recovered and American farmers found it more difficult to find export markets for their products.

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This article was most recently revised and updated by

Agricultural Adjustment Administration (AAA), in U.S. history, major New Deal program to restore agricultural prosperity during the Great Depression by curtailing farm production, reducing export surpluses, and raising prices. The Agricultural Adjustment Act (May 1933) was an omnibus farm-relief bill embodying the schemes of the major national farm organizations. It established the Agricultural Adjustment Administration under Secretary of Agriculture Henry Wallace to effect a "domestic allotment" plan that would subsidize producers of basic commodities for cutting their output. Its goal was the restoration of prices paid to farmers for their goods to a level equal in purchasing power to that of 1909-14, which was a period of comparative stability. In addition, the Commodity Credit Corporation, with a crop loan and storage program, was established to make price-supporting loans and purchases of specific commodities.

Although benefit payments to farmers totaled $1.5 billion by 1936, a rise in commodity prices was attributable mainly to severe drought conditions in 1933-36. In spite of its limited achievements, the early AAA program was favoured by most farmers. The U.S. Supreme Court declared the act unconstitutional in 1936, and Congress passed new agricultural legislation two years later based on the soil conservation concept. While farmers' cash income doubled between 1932 and 1936, it took the enormous demands of World War II to reduce the accumulated farm surpluses and to increase farm income significantly.

The Editors of Encyclopaedia Britannica Jeff Wallenfeldt, Manager, Geography and History.

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Great Depression: Sources of recovery

...Act of 1933 created the Agricultural Adjustment Administration (AAA), which set voluntary guidelines and gave incentive payments to farmers to restrict production in hopes of raising agricultural prices. Modern research suggests that such anticompetitive practices and wage and price guidelines led to inflation in the early recovery period in the...

Franklin D. Roosevelt: The Hundred Days

The AAA established the Agricultural Adjustment Administration, which was charged with increasing prices of agricultural commodities and expanding the proportion of national income going to farmers. Its strategy was to grant subsidies to producers of seven basic commodities-wheat, corn (maize), hogs, cotton, tobacco, rice, and milk-in return for reduced...

...program was centred in the Agricultural Adjustment Administration (AAA), which attempted to raise prices by controlling the production of staple crops through cash subsidies to farmers. In addition, the arm of the federal government reached into the area of electric power, establishing in 1933 the Tennessee Valley Authority (TVA), which...

Agricultural Adjustment Administration

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Agricultural Adjustment Administration | History & Impact

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Agricultural Adjustment Administration (AAA), New Deal program to restore U.S. agricultural prosperity during the Great Depression by cutting farm production, reducing export surpluses, and raising prices. The Agricultural Adjustment Act (May 1933) established the AAA under Secretary of Agriculture Henry Wallace.

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AAA, the Agricultural Adjustment Act & Administration

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In 1937, the Supreme Court ruled that the AAA was unconstitutional, but the basic program was rewritten and again passed into law. Even critics admitted that the AAA and related laws helped revive hope in farm communities. Farmers were put on local committees and spoke their minds. Government checks began to flow.

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The Great Depression (1929–1939) was an economic shock that affected most countries across the world. It was a period of economic depression that became evident after a major fall in stock prices in the United States.[1] The economic contagion began around September 1929 and led to the Wall Street stock market crash of 24 October (Black Thursday). It was the longest, deepest, and most widespread depression of the 20th century.[2]