WHAT IS AN AGRICULTURAL SUBSIDY?

By definition, a subsidy is "a sum of money granted by the government to assist an industry or business so that the price of a commodity or
service may remain low or competitive" (Google). More specifically, an agricultural subsidy is a payment by the federal government to
farmers for producing crops. These subsidies are used to protect domestic farming and maintain national defense by ensuring a secure
food supply.

HOW DID THEY BEGIN?

This basic timeline shows when agricultural subsides came about and how they have evolved. This timeline is specific to North Carolina in
some periods, such as the tobacco farmers of the 1980's, but overall consistent throughout the United States.

n.a. "Agriculture-History". North Carolina Global Learning Lab. n.d. Web. 27 October 2014.

The Agricultural Act of 2014, also known as the Farm bill, was never intended to become the permanent government program it is today. It
was instead created to alleviate some of the burdens the Great Depression left on farmers. The Great Depression was a time when many
people were making a living off of their farm, thus a large number of Americans were farmers. In the 1930's a much larger percentage of
people were farmers compared to the 2% of Americans who classify themselves as farmers today. The Great Depression was caused by a
number of things, but the fact that there were a large amount of farmers only worsened the problem. Due to there being an abundance of
farmers, there was an abundance of food being produced. This may not sound like a problem, but in reality it is because when supply
exceeds demand, there is a surplus, which results in very low prices. Farmers were unable to make a living because their crops were selling
below the cost of producing. This is when the government stepped in and began providing subsidies to farmers. "Congress passed the
Agriculture Adjustment Act in 1933. Essentially, the law paid farmers to not grow food on a certain percentage of their land to reduce the
market glut. It also called for the government to buy excess grain from farmers, which it could later release on the market if bad weather
affected yields" (Masterson par. 7). Over the next 60 years, many farmers left the agriculture business. This left a large amount of money in

the Farm Bill that was being unused, thus causing Food Stamps to overtake the bill which encouraged more urban representatives to
support the bill.

Ryan, Dave. "China Texas has a homemade photo-history museum".

Beaumountenterprise.com. 26 July 2013. Web. 26 October 2014.

Travis, Paul, and Jeffery B. Robb. "Corn". Oklahoma Historical Society's Encyclopedia
of Oklahoma History & Culture. n.d. Web. 26 October 2014.

WHAT CROPS GET SUBSIDIZED?

Of the $956 Billion in spending on the Agricultural Act of 2014, only 20% benefits farmers directly. This chart shows a breakdown of the
spending by crop. Corn receives the largest portion of subsidies, followed by cotton and wheat. These are considered staple products,
meaning that they are the most commonly produced crops in the United States. Corn is most heavily subsidized because it is used in a
number of different products, such as ethanol, animal feed, and many consumer foods ("Hearing to Review"). You may notice, however, that
fruits are omitted from this graph. That is because fruits are not subsidized by the federal government, which has caused numerous people
to question this decision.

n.a. "Hearing to Review U.S. Farm Safety Net Programs". Committee on Agriculture. 17 June 2010. Print. 10 October 2014.

Sources:
Masterson, Kathleen. "The Farm Bill: From Charitable Start To Prime Budget Target." National Public Radio (NPR). 26 September 2011. Web.
16 September 2014.
n.a. "Agriculture-History". North Carolina Global Learning Lab. n.d. Web. 27 October 2014.
n.a. "Hearing to Review U.S. Farm Safety Net Programs". Committee on Agriculture. 17 June 2010. Print. 10 October 2014.
Ryan, Dave. "China Texas has a homemade photo-history museum". Beaumountenterprise.com. 26 July 2013. Web. 26 October 2014.
Travis, Paul, and Jeffery B. Robb. "Corn". Oklahoma Historical Society's Encyclopedia of Oklahoma History & Culture. n.d. Web. 26 October
2014.

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