The Farm Bill That Rocked the 80s (and Beyond)

This Week In Ag #134

1985 was a time for game-changing ensembles. “We are the World” united the world’s greatest musicians – icons like Michael Jackson, Bruce Springsteen, Ray Charles, Lionel Richie and Tina Turner – to sing for African famine relief. The Chicago Bears assembled a colorful cast of characters – led by the punky QB known as Jim McMahon, Sweetness Walter Payton, Sack Man Richard Dent and Refrigerator William Perry – to Super Bowl Shuffle their way to gridiron glory.

Such was the 1985 Farm Bill, an ensemble of farm policies that reshaped modern agriculture. Not since the original Farm Bill, introduced as the Agricultural Adjustment Act during the Dust Bowl Era, had a piece of legislation featured so many far-reaching policies. While most Americans were prospering as they flocked to malls, donned leg warmers, layered polo shirts, and watched Michael J Fox go Back to the Future, many farmers were going back to the Great Depression. In fact, more farms were lost during the 1980s Farm Crisis than during the 1930s. The entire Farm Credit System was on the cusp of collapse. The government had to act. And did they ever.

The 1985 Farm Bill blended conservation with farm payment programs, while implementing supply control measures by offering “incentives”. While positioned as voluntary, much like Don Corleone famously uttered, these incentives were “an offer you couldn’t refuse”, especially when your business was going underwater. Farmers enrolled for farm programs and signed contracts to receive government payments, provide access to loans and offer low crop insurance rates for incorporating various practices.

The term “highly erodible land” – a description given to ground that featured slopes and soil attributes that made it most susceptible to becoming eroded – became part of our vernacular. This ushered the rise of conservation tillage practices intended to ensure at least 30% of the soil was covered with crop residue. It included the use of no-till and tools such as chisel plows and rippers that did not completely bury crop residue in the fall. Fragile crops like soybeans – classified as such because their cultivation can lead to significant soil degradation and erosion – bore restrictions on how they could be planted and managed on HEL.

Sodbuster was a provision that imposed soil stewardship practices for farming highly erodible land. In many cases, you were not allowed to touch ground previously planted in soybeans. Swampbuster was a similar provision, which incentivized farmers to take wetlands out of agricultural production.

The Conservation Reserve Program (CRP) was established. It incentivized producers to essentially retire highly erodible and environmentally sensitive land from production. Basically, you got paid to not farm this land.

A Whole Herd Dairy Buyout incentivized farmers to sell their herds for slaughter and exit the business for five years, with the goal of reducing milk production by 12 billion pounds. Nearly 14,000 dairymen took Uncle Sam up on his offer. So what do you suppose happened? Big dairy farms immediately expanded their operations, milk supply continued to rise, and small dairy farms disappeared across the Midwest landscape.

Deficiency payments were established to help offset depressed markets. Target prices were federally established for commodity crops such as corn, soybeans, wheat and rice. If market prices fell below those targets, the government paid farmers the difference.

As we mark the 40th anniversary of this landmark legislation, the question remains: “Was the 1985 Farm Bill a success?” That continues to be a matter of debate. These were desperate times, and some level of stability was restored. Eventually, the ag economy turned, but much of that was due to market-driven forces such as biofuels and exports. Nearly 34 million acres of marginal farmland were taken out of production. Estimates show cropland soil erosion rates fell by 35-40%. Yet there’s no denying that 1985 opened Pandora’s box, where the US government continues to dive deeper into all farm-related matters. As for those government payments, they’ve also played a role in raising cash rents to levels unapproachable by many smaller operators. Regardless of your take, one thing’s for sure. The 1985 Farm Bill shaped farm policy for generations to come. Placing us on a trajectory from which we’ll likely never turn back.