Intro to Policy
Define Ag. Policy
The set of laws, regulations, and government programs that govern the agriculture sector and shape how food is grown, processed, and sold.
What is the Primary goal of any governments Ag. policy.
Affordable Food
Name the 3 major U.S. Ag. policy events of 1862
Morill act
Homestead Act
Creation of the USDA
What are the 3 parts of the modern farm safety net?
Commodity Programs, Crop Insurance, Disaster Assistance
This fan of herbal farm products was the original headliner of the Farm Aid Concerts and still supports them to this day
Willie Nelson
What are the 3 types of law in Amercia
Constitutional, Civil, Criminal
What are the 4 charachteristics that we discussed of Ag. markets
•Seasonal Products
•High Perishability
•Bulky hard to transport items
•Inconsistent quality
The Land Ordinance of 1785 did what.
Created a grid system to survey and sell public lands west of the Appalachian Mountains.
Approximatly what percentage of subsidy payments get captured in land values?
80%
Livestock Indemnity program will pay you for the loss of livestock from natural disaster, disease and predators. What do they not pay for?
Normal mortality. So if you lose an average of 5 calves a year this year you lose 15 they only pay for 10.
In U.S. ag policy this creates the legal authority, big-picture goal, and funding
The Law
What is an Omnibus bill?
This type of bill is commonly used in modern policy to combine many different laws or spending items into a single large proposal
Describe the Agricultural Adjustment Act of 1938
The foundation of the modern farm bill and the first legally binding general farm policy for the U.S.
What are your 5 questions of policy analysis?
1. What problem is government trying to solve?
2. What is the policy mechanism?
3. Who benefits?
4. Who pays?
5. What incentives or unintended consequences does it create?
What are ARC, PLC, and Marketing Assistance loans?
Commodity programs under title 1 of the farm bill.
ARC is agricultural risk coverage it is a revenue based insurance coverage
PLC is Price Loss coverage it is a Price based insurance coverage
In U.S. ag policy this provides the strict, technical rulebook
The Regulation
What is a Tariff?
A Tariff is an import tax placed on a good. It is paid by the importer of that good, but the cost is usually passed down to the consumer.
This former USDA Secretary said "Get Big or Get Out!"
Earl Butz
How do export promotion and foreign market development work together?
Export promotion is a domestic program encouraging industries and companies to sell their goods internationally. Foreign Market Development works internationally to get companies and industries to purchase U.S. goods and services. They are complimentary program that together create export markets for U.S. goods and services.
Explain why crop insurance is more economically sound than ad hoc disaster payments.
It is more economically sound to insure against risk than pay a disaster payment. This is because the producer shares in the cost by paying a premium, they are more likely to manage against risk, and the amount payable is predictable and limited.
In U.S. ag policy this provides the real-world resources, funding, and tools to help people succeed
The Government Program
An inelastic demand curve demonstrates what?
That a small change in quantity can lead to a large change in price.
What long term lesson did we learn from the farm crisis of the 1980's?
Risk Management is a greater tool for U.S. Ag than price supports
List the 12 titles of the farm bill in order
Commodities, Conservation, Trade, Nutrition, Credit, Rural Development, Research, Forestry, Energy, Horticulture, Crop Insurance, Misc.
What is the recurring Ag. Policy Problem?