IDEAS home Printed from
   My bibliography  Save this paper

U.S. Farm Policy: Can Fair Be Fixed?


  • Runge, C. Ford


In the scheme of things, the 1996 Federal Agricultural Improvement and Reform Act (FAIR) contained important breaks with a tradition of crop-by-crop subsidies dating back to the Agricultural Adjustment Act of 1933. It freed many producers of "program commodities" (maize, grain sorghum, wheat, barley, oats, cotton and rice) from a system of crop-specific base acre accounting, merged these accounts into a single "whole farm base," and allowed production of any but a few crops on these lands. Overall, the freedom to produce in direct response to market forces, rather than on the basis of crop-by-crop subsidies, as well as the budget discipline of predetermined payments, were important steps in the direction of decoupled lump-sum compensation. Yet from the point of view of advocates of policy reform, FAIR represents an unfinished agenda. A variety of problems and issues remain. First, the coverage of "freedom to farm" is only partial, with numerous commodities left out of the decoupling program. Second, those critical of the distributive impacts of the commodity programs find little to cheer about in the new contracts, and consider the acronym FAIR ironic. Supply responses induced by price levels in the first two years of FAIR have led to substantially lower prices and marketing receipts in 1998. A call has now gone up to resuscitate some form of safety net, such as a return to deficiency payments or an extension and increase in contract payments under the 1996 Act. It is appropriate to move now to finish the unfinished agenda of the 1996 Act by implementing a long term safety net based on some form of revenue assurance (á la Cochrane and Runge, 1992).

Suggested Citation

  • Runge, C. Ford, 1998. "U.S. Farm Policy: Can Fair Be Fixed?," Staff Papers 13294, University of Minnesota, Department of Applied Economics.
  • Handle: RePEc:ags:umaesp:13294

    Download full text from publisher

    File URL:
    Download Restriction: no

    References listed on IDEAS

    1. Vande Kamp, Philip R. & Runge, C. Ford, 1994. "Trends and Developments in United States Agricultural Policy: 1993-1995," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 62(03), December.
    2. Olson, Kent D., 1998. "Net Farm Income Estimated To Drop Precipitously In 1998," Staff Papers 14252, University of Minnesota, Department of Applied Economics.
    Full references (including those not matched with items on IDEAS)

    More about this item


    Agricultural and Food Policy;


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:umaesp:13294. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.