Chapter 5: War, Peace, and Prosperity: 1940-1959
In January 1940, Senator Ellison, D. "Cotton Ed" Smith had been at the helm of the Senate Agriculture Committee for seven years. Senator Smith presided over a Committee of 13 Democrats and six Republicans. The Committee had a majority of eight Senators from the West, with the Central and Southern U.S. equally divided at five. Only one Senator, Ernest W. Gibson, a Republican of Vermont, hailed from the East.
The 1940s and 1950s would be a period of dramatic change for agriculture. The number of people engaged in farming dropped from 17 percent of the total workforce in 1940 to six percent, a two-thirds decline by 1960. With war looming in Europe and the Pacific, the initial effort was to continue the programs of the 1930s and, now, to ensure a supply of food to feed not only Americans and their soldiers, but much of the rest of the world as well. At the end of hostilities in the late 1940s, the goal of agriculture policy changed dramatically, from production to the support of prices, as farmers around the world returned land to production. Price support efforts included the Steagall Amendment, the Agricultural Acts of 1948 and 1949, the permanent funding of the Commodity Credit Corporation (CCC), and Public Law 480, the Food for Peace Program.
There were other efforts to assist agriculture during this period as well. Continuing to improve life in rural America remained a major goal. For instance, the Department of Agriculture Organic Act of 1944, while restructuring the Department, also liberalized the terms of Rural Electrification Administration (REA) loans by establishing a fixed interest rate at the approximate cost of borrowing money, and extended the loan repayment period. Until 1944, REA made loans primarily to rural electric service cooperatives and public power districts at interest rates that fluctuated with the Government's cost of borrowing money. Congress further expanded the purpose of the REA in 1949 to authorize rural telephone loans to develop and improve telephone service in rural areas. In 1949, only 36 percent of farms had telephone service of any kind, and much of that was of low quality.
The Congress, also continued its rural teaching and training effort begun in the previous century by passing the Bankhead-Flannigan Act of June 6, 1945, named for Senator John H. Bankhead of Alabama and Congressman John William Flannigan, Jr., of Virginia. Senator Bankhead, a member of the Agriculture Committee for nearly fifteen years, died almost exactly one year later, in June 1946. The Act expanded the duties of the Extension Service. County agents were authorized to broaden the 4-H club program, to render greater assistance to veterans, and to help farmers make use of new technologies that were becoming available.
It was during the 79th Congress in 1945 that the Committee's longest serving member joined. Senator Milton R. Young, a Republican of North Dakota, began service on the Committee April 5, 1945, when he was appointed to the position after Senator John Moses of North Dakota died. Senator Young served on the Committee for a total of 35 years and nine months until his retirement on Janurary 3, 1981. Senator Ellison D. "Cotton Ed" Smith, a Democrat of South Carolina, served 35 years, eight months, only one month less than Senator Young.
The post-World War II period also marks the beginning of the Committee on Agriculture and Forestry receiving formal jurisdiction over agricultural issues as defined by Senate Rule in the Legislative Reorganization Act of 1946. The act, signed by President Truman August 2, 1946, among other reforms, reduced the number of standing Senate Committees from 33 to 15, and set out the first written statements of House and Senate Committee jurisdictions. Though the 1946 reorganization altered some committee jurisdictions, the measure primarily confirmed the authority the Agriculture Committee already had. The only change was that the Committee gained sole jurisdiction over farm credit and farm security, areas it formerly shared with the Committee on Banking and Currency. (U.S. Senate. Temporary Select Committee to Study the Senate Committee System. The Senate Committee System; staff report, 94th Cong., 2nd session, Washington, D.C. U.S. Govt Printing Office p. 147)
The Committee in 1940, during President Franklin Roosevelt's third term, had consisted of 13 Democrats and six Republicans, or a total of 19 members. With the implementation of the Legislative Reorganization Act of 1947, the number of Senators serving on the Agriculture Committee dropped to seven Republicans and six Democrats for a total of 13 members. By the end of 1960, the Agriculture Committee membership had again risen to 17 Senators, 11 Democrats and six Republicans. However, Committee staffing levels remained unchanged at eight staff members from 1940 through the end of 1960. It was during this period, however, that the Committee staff began to take its present shape. The Chairman named a Chief of Staff during this period and the Committee hired its first counsel, investigator, and economist. (Congressional Staff Directory, Washington, D.C., 1940, p. 100.)
As the war in Europe and Japan ended, the Congress directed the Department of Agriculture to focus on rural training, as well as cooperation with state experiment stations and the land-grant colleges in investigating the scientific, technical, economic and other aspects of the economic principles underlying the basic problems of agriculture. Two acts, the Agricultural Marketing Act of 1946 and the Research and Marketing Act of 1946 signed into law on August 14, 1946, substantially broadened the Department's research and extension authority to include the marketing, transportation, and distribution of agricultural products. The Acts also emphasized research in human nutrition and the nutritive value of agricultural commodities.
As soldiers went back to farming in 1946, the availability of credit became a significant issue. In 1946, Congress reorganized the Farm Security Administration under the Farmers Home Administration (FmHA) Act. This action reflected the consensus that a restructuring of the Farm Security Administration was necessary to meet the growing credit needs of the post-war period. This Act authorized the new FmHA to insure loans and to make direct loans using Government funds. This new agency included some programs of the Farm Security Administration, as well as the emergency crop and feed loan program that had been implemented through the production credit associations of the Farm Credit System since 1933. The Disaster Loan Act of 1949 expanded these responsibilities by initiating the special emergency farm loan program to assist farmers in recovering from natural disasters.
The anticipated transition from war to peace with its potential for lower prices because of surplus production underscored the approval of the so-called Steagall Amendment, championed by Congressman Henry B. Steagall. Approved October 2, 1942, the Steagall Act required Government support of certain commodity prices for two years following the close of the war. Congress enacted it to bolster farm income and protect farmers against an anticipated sharp decline in demand following the war. It was restricted to commodities for which expanded production had been requested.
The price supports adopted under the Steagall Amendment were meant to be temporary post-war measures, set to expire at the close of 1948. Congress, however, in the Agriculture Act of 1948, extended price supports to 1950 on a substantial list of farm products at 90 percent of parity and provided for a range of price supports from 60 to 90 percent of parity after 1950. Parity was defined in relation to what a market basket of goods had cost farmers during the period 1910-1914. The 1948 Act also provided for the creation of marketing quotas on the basic crops (cotton, corn, wheat, rice, tobacco, and peanuts) when supplies became excessive. Federal expenditures for agriculture grew nearly eight times from what they had been in 1940 by the end of the period. In 1940, $369 million were expended for agriculture, by 1960 that number had grown to $2.6 billion.
To better provide post-World War II adjustment policies for the U.S. farm sector, Congress also made permanent the Commodity Credit Corporation (CCC), through enactment of the Commodity Credit Corporation Charter Act on June 28, 1948. (Between 1933 and 1948, the Commodity Credit Corporation charter was regularly renewed, but only for short periods of time). The CCC provided a revolving fund of credit available to farmers from the corporation. Although wholly controlled by the Department of Agriculture, CCC was a corporation chartered in Delaware. During the war U.S. farms had been operating at maximum capacity to support the military and to feed residents of allied nations whose productive capabilities had been destroyed.
Anticipating growing farm problems as demand shifted to prewar levels, the CCC Charter Act provided postwar adjustment policies and programs including provision for export promotion programs as one way of supporting farm income and stabilizing commodity supplies at a time of uncertainty. Authority for the export promotion programs provided in the Charter Act form the foundation for today's Federal export efforts including General Sales Manager (GSM) sales. Authorized through the Act are programs to finance export credit sales of agricultural commodities, to conduct special export programs for bartered materials, to implement export sales of CCC-owned commodities, to conduct export payment programs, and to generally arrange transportation for commodities from point of export. Over the years, these programs have resulted in billions of dollars worth of surplus agricultural commodity exports and overseas market development for U.S. agricultural products.
Falling on the heels of the 1948 Act, the Agricultural Act of 1949 made permanent amendments to the Agricultural Adjustment Act of 1938 and established the combined public policy of flexible price supports with acreage controls. The Act consolidated the price support provisions of several earlier laws. In addition to making changes in the price support and marketing quota provisions with respect to the basic commodities, the 1949 Act established mandatory supports for dairy products, tung nuts, honey, potatoes, and wool at levels ranging from 60 to 90 percent of parity. Section 416 of the Agricultural Act of 1949 also authorized the CCC to provide schools and other institutions with basic commodities acquired under farm price support activities. Section 32 of the 1949 Act was limited to the purchase and distribution of so-called perishable items, such as livestock products and produce.
The 1938 Act, as amended by the Agricultural Act of 1949, became the permanent authority for most commodity programs. It was in 1973 that Congress adopted a series of 4-year omnibus farm bills amending these earlier permanent acts and defining policy for the succeeding years. The four year omnibus farm bills have been broad in scope, encompassing commodity price supports, agricultural research, extension, domestic feeding programs, foreign food assistance, export promotion, and conservation.
During the early post-war years, a shift in policy emphasis away from expansion of agricultural production occurred. From 1948, major legislative interest centered on mandatory price-support levels. Acreage allotments and marketing quotas, as provided for in 1938 legislation, were believed to be adequate to keep production in line with available market outlets at the support level prices. In addition agricultural trade policies, which had been highly protectionist during the 1930s, moved toward a post-World War II policy of gradual elimination of all tariff and non-tariff barriers to trade, evidenced by our Nation's leading role in the 1947 establishment and continuing refinement of the General Agreement on Tariffs and Trade (GATT).
The Agricultural Act of 1949 also established, for the first time, authority to donate surplus commodities to needy persons overseas through voluntary relief organizations. Because crop surpluses were accumulating in the 1950s, it was proposed that they be eliminated through concessional sales and donations to developing nations. Thus, the Agricultural Trade Developmental and Assistance Act of 1954 (P.L.- 480) was adopted as a short term solution to the surplus problem. Section 416 donations from the Agricultural Act of 1949 were incorporated as an important element of Public Law 480, later titled Food for Peace.
As expected, the post-war era saw a decline in demand and farm income with a corresponding increase in surplus commodities. P.L.-480 sought to simultaneously provide food and fiber to the world's needy while reducing U.S. farm surpluses. The law authorized the Government to make agreements for the sale of farm products for foreign currency, to make shipments for emergency relief and other aid, and to barter farm products owned by the CCC for materials required by our government.
The Food for Peace program was the principal authority for American food aid for three decades. Not only has the program been of major importance in developing new markets for, and in disposing of, farm products abroad, it has also aided the economies of developing countries and fed the hungry throughout the world. On the 30th anniversary of the program, President Reagan lauded the program as "one of the greatest humanitarian acts ever performed by one nation for the needy of other nations." Numerous accomplishments can be attributed to the Food for Peace program. The value of P.L.-480 food aid grew from $69 million in 1954 to $1.7 billion in 1986, then declined to $769 million in fiscal 1997. Since the program's inception, an estimated 675 billion pounds of food products, worth about $43 billion, have been delivered to hungry and disadvantaged people throughout the world. About 1.8 billion people in more than 100 countries have received direct benefits from this program.
In addition to exporting domestic food surpluses, the government experimented with acreage controls, and in doing so, a new conservation effort was born. Experience gained in early watershed demonstration projects led to a new concept in watershed protection. On August 4, 1954, President Dwight Eisenhower signed the Congressionally passed Watershed Protection and Flood Prevention Act which authorized the Department of Agriculture through the Soil Conservation Service (SCS) to provide technical and financial assistance to local watershed groups willing to assume responsibility for initiating, carrying out, and sharing the costs of upstream watershed conservation and flood prevention. This legislation has been amended many times since 1954. In these amendments, Congress expanded the authorized purposes of Federal assistance for watershed projects to include municipal water-supply development, irrigation and other phases of agricultural water management, fish and wildlife development, and recreation purposes. Congress also raised limits on project expenditures that could be made without Congressional approval.
On May 28, 1956, the 84th Congress passed legislation authorizing a Great Plains Conservation Program in an amendment to the Soil Conservation and Domestic Allotment Act. The goal of this program, administered by the SCS, was to bring about a more permanent solution to problems accompanying drought and the cultivation of low-grade cropland by assisting farmers in changing their cropping systems or land use. Farmers participating in this program signed long-term soil and water conservation agreements to install and maintain needed land use, adjustments and the application of enduring conservation practices. Congress amended the program numerous times, extended its coverage and increased its appropriations. In the 1960s, for example, the Soil Conservation and Domestic Allotment Act doubled the cost limit of the program and increased the annual limit on cost-sharing funds. It also made additional causes of erosion eligible for treatment under the program.
At the beginning of the 84th Congress, in 1955, the Agriculture Committee created its first standing subcommittee, although the Committee had created temporary subcommittees earlier. The new subcommittee, chaired by Senator Hubert Humphrey of Minnesota, was one of five created between March 2 and May 18. They were (1), Soil Conservation and Forestry; (2), Agricultural Credit and Rural Electrification; (3), Agricultural Production, Marketing, and Stabilization of Prices; (4), Agricultural Research and General Legislation; and (5), Tobacco. Although subcommittees had been authorized since 1921, it was the Reorganization Act of 1947, with its reduction in the number of standing committees, that spurred the creation of subcommittees, although they tended to be temporary in nature. According to Senator Robert Byrd, in his seminal work The Senate: 1789-1989, power in the Senate had been diffused throughout the Senate when Committees proliferated. However, with the reduction of the number of Committees, power in the Senate moved to committee chairmen. It was then the subcommittee that served to diffuse power under the smaller committee system. (Robert C. Byrd, The Senate: 1789-1989, Addresses on the History of the United States Senate, Volume II, Washington, D.C., Government Printing Office, 1991, p. 244.)
There was an ongoing need to address the ironic problem of bountiful harvests and declining livestock prices in the fall of 1955. The difficulties caused farmers to propose additional emergency action aimed at bringing supplies into balance with demand at stable prices. The emergency action agreed upon in 1956 took the form of a two-part soil bank program. One part of this program was a 3 million- acre reserve program in effect for 3 years. The specific objective of the acreage reserve was to reduce the amount of land planted to the basic price-supported crops. Under its terms, farmers reduced land planted in these crops below established allotments and received payments for the diversion of such acreage to "conserving uses." The second part of the soil bank program was the conservation reserve, which offered modest rental payments for retiring other cropland acreage or entire farms from production for multiple-year periods.
In addition to price supports, exports and food aid, school lunch programs became permanently established with the National School Lunch Act of 1946 and a food stamp program was permanently authorized. Although the Agriculture Committee's jurisdiction over the School Lunch program was transferred to the Committee on Labor and Public Welfare in 1946, the Senate parliamentarian continued to refer school lunch legislation to the Committee on Agriculture because it was understood that the program had originated as a way to use surpluses of agricultural commodities. The National School Lunch Act of 1946 permanently authorized Federal cash assistance for school meals. Under the law, the Secretary of Agriculture was to assist States, primarily through grants-in-aid, to set up and operate lunch programs in schools "to safeguard the health and well-being of the Nation's children and to encourage the domestic consumption of nutritious agricultural commodities and other food . . .". States were required to match the Federal funds, to assure that meals met certain nutritional standards, and to assure that participating local authorities offered meals free or at discounted prices to children unable to pay the full cost.
The first significant changes in the 1946 school lunch law were adopted in 1962, under a climate of rising concern about poverty in the Unites States and a desire to help schools lacking the resources to provide low-cost meals to poor pupils. The legislation permanently authorized, under Section 11 of the 1946 Act, additional funding to States to support free and reduced-price lunches in economically depressed areas. This added emphasis on food and nutrition, in large part, defines the next decade.
The period 1940 to 1959 underscores the significant changes that were underway for agriculture in the United States. After two decades of poverty in rural America, including the Great Depression, the employment and demand of World War II caused rapid change. The Congressional focus, however, became what to do with significant surplus food production. The answer was to distribute it to not only our own poor but the world's poor as well. By the end of the decade, the issue of nutrition was coming to the fore.