Thursday, April 06, 2017

U.S. Agricultural Policy in the World Economy

In the hope of arousing abiding interest among those who’ve yet to read this work, what follows is from the informative if not provocative Foreword by James C. Scott to Bill WindersThe Politics of Food Supply: U.S. Agricultural Policy in the World Economy (Yale University Press, 2009):

“The task Bill Winders sets himself is sharply etched but, at the same time, dauntingly ambitious. How can one account for the demise of the trinity of production controls, price supports, and export subsidies that guided agricultural policy in the United States for more than a half century from the New Deal to the mid-1990s? The bookends of this enterprise are Franklin Roosevelt’s Agricultural Adjustment Act (AAA, 1933), which instituted supply management, and the Federal Agriculture Improvement and Reform Act (FAIR Act, 1996), which abandoned it. Explaining this convincingly, as Winder does, requires a high order of interdisciplinary skills, including a firm grasp of partisan congressional politics, of agrarian movements throughout the country, of international trade, and of economic history. [….]

In place of explanations that have relied largely upon the vagaries of partisan politics and commodity prices to explain major policy shifts, Winders substitutes a particularly sophisticated version of class and sectoral politics. The three crops—corn, cotton, and wheat; those who grow them, market them, and buy them; and above all, those whose political futures depend upon keeping each crop’s constituents content, are the key actors in Winders’s drama. Each crop is distinctive in its geographical location, its class and ownership structure, its markets, and its political clout. The constituents each have different political interests, which, furthermore, shift over time. The coalitions they forge and dissolve, Winders argues, form the most reliable weather vane indicating the probable direction of agricultural policy.

The historical dialectic that Winder traces among the constituents for the various crops, the policy outcomes, and the resulting shifts in the structure and interests of the growers and sellers of each crop is what gives his analysis its dynamic quality. In a discerning version of the adage ‘be careful what you wish for,’ Winders shows how a policy ‘victory’ by, say, the growers of cotton or corn serves, in unanticipated ways, to transform their very structures, interests, and sway. The logic is worked out to great effect in the southern cotton sector. There, in a setting where serfdom, in the form of share-tenancy, had replaced slavery, landlords seized for themselves alone the crop payments mandated by the AAA. When they were required by law to share these payments with tenants, landlords responded by dismissing the tenants, moving to more capital-intensive production, and diversifying into growing soybeans and feed grains and raising livestock. This, in turn, helped touch off the great migration north by poor rural blacks and whites, setting the stage for the cotton lobby’s decline and facilitating the civil rights movement. Eventually, the demise of the one-party South broke the seniority-based death grip southerners had exercised on congressional democrats since the Civil War. Recursive, dialectical analysis of this kind seems, in my view, to offer the most promising way forward for otherwise wooden and static class analysis. It also helps explain why the one genuine attempt at land reform to break the back of (largely) racialized peonage in the cotton South failed. FDR’s agrarian reformers—Rexford Tugwell, Jerome Frank, and ‘Pat’ Jackson—were, to use a contemporary expression, ‘thrown under the bus’ when the full congressional power of the southern planters was brought to bear on the New Deal. Just as post-Civil War Republican Reconstruction was undone by white planters, so was DFR’s post-Depression plan for a reconstructed and more equitable agrarian South undone by much the same forces. [….]

Winders understands, as did Polanyi, than no one, save a handful of theorists, loves perfect competition. The ultimate goal of all producers and wholesalers is some form of oligopoly or monopoly that allows price fixing. Producers understand that the more ‘perfect’ the competition becomes, the closer the rate of profit approaches to zero. The coveted shelter from ‘cut-throat’ competition is, short of natural monopolies, available to small-scale producers only through political influence. North American cotton and wheat growers have for some time, in international markets, been price-takers rather than price-givers and hence have sought protection. Corn, on the other hand, because the United States is the dominant world exporter and because core is an ‘input’ feed grain for foreign and domestic livestock rearing, has generated a far more complex set of interests. At any event, the representatives of agrarian producers have generally sough precisely what Boeing, Chrysler, Harley-Davidson, and Bear Stearns have sought: to privatize profits and socialize losses. When prices were buoyant, the pressure for price and export subsidies diminished, and when prices plummeted, the political clamor for subsidies grew. Whether the producers had the political clout to legislate their profit insurance is a large part of Winders’s story, but what has never been in doubt, following Polanyi, is their desire to be politically sheltered from a tumultuous market.

[….] Surely, it is curious that, from at least the New Deal forward, U.S. agricultural policy has primarily centered on price supports for the major commodities: corn, cotton, wheat, tobacco, soybeans, milk, etc. That is, the place occupied in other countries by a rural policy has been usurped in the United States by commodity policy. Why this should be so is both intriguing and complex. One might argue that the early ambitions of the Tennessee Valley Authority were the embryonic beginnings—alas stillborn—of a genuine rural policy. After this failure, the issue of price supports dominated agrarian politics in Washington. Where the French, the Danes, the Germans, and the Norwegians have asked themselves what kinds of rural communities they wish to promote, what the rural landscape should look like, what land uses should be encouraged, and what rural services should be publicly provided, Americans have seldom posed such questions, let alone addressed them until very recently. Until they are addressed, we may have a wheat or corn policy but nothing that remotely resembles an agricultural, let alone a rural, policy.”

Professor Winders’ latest book is Grains (Polity Press, 2017).


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