What was the purpose of the Agricultural Adjustment Act (AAA) during the New Deal ?

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President Franklin Delano Roosevelt's (FDR) New Deal was a series of government programs and subsidies designed to address the severe economic distress of the Great Depression. The Agricultural Adjustment Act (AAA) was a part of this process and addressed the problem of agricultural overproduction.

The AAA paid farmers to limit...

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President Franklin Delano Roosevelt's (FDR) New Deal was a series of government programs and subsidies designed to address the severe economic distress of the Great Depression. The Agricultural Adjustment Act (AAA) was a part of this process and addressed the problem of agricultural overproduction.

The AAA paid farmers to limit production of certain commodities in order to reduce surpluses and prevent major drops in commodity prices. The AAA allowed smaller farms—tenant farmers and the like—to use land to grow food crops for personal consumption and the subsidies help many of them survive.

The AAA was ruled unconstitutional but kept in place and revised in the late 1930s.

In many ways, the AAA was a government response to a phenomena that couldn't be stopped. Changes in the nature of farming, innovation, the consolidation of many farms and improvements in technology were allowing for greater and greater yields with less and less labor.

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One of the major problems for farmers during the Great Depression was overproduction.  Farmers were able to produce much more than the depressed markets could buy.  This led to crashes in prices for farm products.  When farm prices crashed, farmers were, of course, badly hurt.  The AAA was meant to address this issue.

The main tactic of the AAA was to reduce farm output.  The AAA set up a scheme in which farmers would be paid not to produce.  As farmers produced less in the way of crops, prices would go back up.  This would end up helping farmers get out of their financial difficulties.

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