1.%20%20AGRICULTURAL%20PUBLIC%20POLICY%20

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1. AGRICULTURAL PUBLIC POLICY HOW IT WORKS
IN U.S.

• Larry D. Sanders
• Fall 2005

Dept. of Ag Economics Oklahoma State
University
2
Introduction

• Purpose gain an awareness of ag public policy
  the process of policy development
• Content Learning Objectives
• 1. Define agricultural public policy
• 2. Understand the process of policy
• development implementation
• 3. Understand the underlying philosophies
• of policy formation

3
Introduction--continued

• Process Learning Objectives develop skills of
• 1. Critical Thinking
• 2. Written Verbal Communication
• 3. Problem Solving
• 4. Teamwork

4
Lecture

• The process by which an idea is
• transcribed from the notes of the teacher to
  the notes of the student without going through
  the mind of either

5
Anxiety Test

• The ultimate test of a set of economic ideas. .
  . is whether it illuminates the anxieties of the
  time. Does it explain problems that people find
  urgent? Does it bear on the current criticism of
  economic performance? . . . Does it bear upon the
  issues of political debate? For these, though
  many have always preferred to believe otherwise,
  do not ignite spontaneously or emerge maliciously
  from the mouths of agitators to afflict the
  comfortable.
• --John Kenneth Galbraith, Economics the Public
  Purpose, 1973 bold italics added by instructor

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What is agricultural public policy?

• Policy Definition
• Determinants of Policy Position
• Agricultural Policy Objectives
• Policy Process

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Policy Definition

• Class
• Knutson
• Policy guiding principle leading to a course of
  action or specific program that is pursued by the
  government
• Ag/food policy embody principles that guide
  govt. programs in production, resources utilized
  in production, domestic intl markets for
  commodities food products, food consumption,
  rural America conditions.
• Working definition
• Whatever government chooses to do or not do

8
Policy Determinants

• Facts what is
• Beliefs what people think
• Values what should be
• Myths widely shared stories about how society
  ought to be organized
• Goals desired results
• Examples

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TWO WORMS
OO v
OO v
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US Agricultural Policy Objectives

• Protect farmers from market instability
• Maintain adequate food supply at reasonable
  prices
• Encourage agricultural exports to pay for US
  growth in productivity
• Industrialization
• Imports
• Economic Growth

11
Policy Process

• Kings Kingmakers
• Power Clusters
• Hahns Model
• How a bill becomes law
• Role of Government
• Iron Triangle

12
Kings and Kingmakers Model
King- Makers
Kings
Actives
Interested Citizens
Apathetic Citizens
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Role of Government (Evolving Process)

• 1. Economy Purpose is provisioning of
• society
• 2. 1930s Economic poor health
• 3. Keynes More govt. necessary to
• counter shortrun market problems
• In the long run, market will stabilize.
• But in the long run, well all be dead.

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Role of Government (cont.)

• 4. FDR Relief, Reform, Recovery
• --Dramatic increase in government
• intervention
• 5. 1940s WWII supported Keynes claim
• --Employment Act of 1946
• 6. 1960s Heller--Ability to fine-tune
• economy within sight.
• --BUT fighting 2 wars (Poverty Vietnam)

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Role of Government (cont.)

• 7. 1970s The bill comes due
• --Inflation Recession
• --Stagflation
• 8. 1980s Reaganomics--intended to reduce govt.
  in marketplace, enhancing free market national
  security (in fact greatly increased federal
  spending)
• 9. 1992 Clintonomics I--new liberalism to
  reduce govt. with social concern (mixed success)

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Role of Government (cont.)

• 10. 1994 Conservative revolution
• --contract to reduce federal govt. let state
  or private sector decide (mixed success)
• 11. 1997 Clintonomics II--new liberalism
  constrained by Conservative Congress
• 12. 2001 Compassionate Conservatism???

17
Role of Government (cont.)

• 2002
• Global Terrorism Wartime Economy
• Desire to downsize domestic govt. conflicts with
  entrenched interest groups
• W legacy still evolving

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The Role of the Federal Government?

• . . . Getting government off the back of
  business simply means putting business on the
  back of government. . . . Historically it is the
  national government that has served as the
  protector of the powerless.
• . . . Democratic capitalism has triumphed
  because of the long campaign of reformers . . .
  To use the national government to humanize the
  industrial order, to cushion the operations of
  the economic system, to strengthen the bargaining
  position of workers and farmers and consumers, to
  regulate wages and hours, the quality of products
  and the sale of securities, to insure against
  recurrent depression by built-in economic
  stabilizers, . . . To combine individual
  opportunity with social responsibility . . .
  --Arthur Schlesinger, Jr. (1995)

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Legislative Key Committees

• Senate Ag Committee (20 members 11 R 9 D)
• Chair Chambliss (GA)
• Subcommittees (4)
• Production/Price Competitiveness (McConnell-KY)
• Marketing, Inspection Product Promotion
  (Talent-MO)
• Forestry, Conservation Rural Revitalization
  (Crapo-ID)
• Research, Nutrition General Legislation
  (Santorum-PA)
• http//www.senate.gov/
• http//www.house.gov/

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Legislative Committees (cont.)

• House Ag Committee (45 members 24 R 21 D)
• Chair Goodlatte (VA) Subcommittees (4)
• General Farm Commodities Risk Management
  (Moran-KS)
• Lucas (OK)
• Livestock Horticulture (Hayes-NC)
• Conservation, Credit, Rural Development
  Research (Lucas-OK)
• Specialty Crops Foreign Ag Programs
  (Jenkins-TN)
• Dept. Operations, Oversight, Nutrition Forestry
  (Gutknecht-MN)

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Legislative Committees (cont.)

• Senate Appropriations
• Chair (Cochran-MS)
• Ag Subcommittee (Bennett-UT)
• House Appropriations
• Chair J. Lewis (CA)
• Ag Subcommittee (Bonilla-TX)
• Senate Budget (Gregg-NH)
• House Budget (Nussle-IA)
• Senate Foreign Relations (Lugar-IN)
• House International Relations (Hyde-IL)

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Legislative (cont.)

• Senate-OK reps committee memberships
• Inhofe (R-OK)
• Armed Services
• Environment Public Works (Chair)
• Coburn (R-OK)
• Indian Affairs
• Judiciary (subcommittee chair)
• Homeland Security Govt Affairs (subcommittee
  chair)

23
Legislative (cont.)

• HouseOK Representatives memberships
• District 1 Sullivan (R-OK)
• Energy Commerce
• District 2--Boren (D-OK)
• Armed Services
• Resources
• District 3--Lucas (R-OK)
• Agriculture
• Financial Services
• Science

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Legislative (cont.)

• House OK Reps (cont.)
• District 4-- Cole(R-OK)
• Rules
• Ethics
• Armed Services
• Deputy Majority Whip
• District 5--Istook (R-OK)
• Appropriations

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Policy Philosophies

• Free Market
• Let market work market signals must be allowed
  to work
• Govt. action ineffective/part of problem
• Humanitarian
• Feed expanding world population
• Govt. obligated to expand production
  (distribution is important)
• Right-to-food

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Political Philosophies (cont.)

• Agricultural Fundamentalist
• All real wealth in land/agriculture (Physiocrats)
• Govt. must preserve agriculture to preserve
  culture society (parity concept)
• Stabilizer
• Instability is the real problem
• Govt. must stabilize prices

27
Political Philosophies (cont.)

• Regulator
• Free market is unreliable, unstable (chronic
  problems)
• Govt. must plan entire process for rational
  coordination to control production, educate key
  players consumers

28
USDA

• Farm Foreign Ag Service
• Marketing Regulatory Programs
• Food Safety
• Rural Development
• Natural Resources Environment
• Food, Nutrition Consumer Services
• Research, Education Economics
• http//www.usda.gov/services.html

29
Forces of Policy Change

• Instability
• Globalization
• Technology
• Food Safety
• Environment
• Industrialization
• Politics
• Unforseen Events

30
Changing Control
Sec. of State
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Fact or Myth or Belief?

• 1. Agrarian values are simple basic to American
  values.
• 2. Farming is the primary rural business,
  occurring only in rural areas.
• 3. Most farms are average.
• 4. Production productivity in ag.

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Fact or Myth or Belief?

• 5. Farm prices alone describe the farm financial
  situation.
• 6. US ag does not need global trade.
• 7. Good farming means a healthy environment.
• 8. Farm programs are effective food programs.

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Fact or Myth or Belief?

• 9. Govt. programs are successful in achieving
  their stated goals.
• 10. The trend toward fewer, larger farms is
  escalating.
• 11. Large corporations have taken over farming.
• 12. Most farm family income comes from farm
  income.

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Assignment

• 25 Aug Read Knutson Ch. 1, 3
• Identify OK US Senators Representatives list
  their committee assignments (CLUE Check these
  web sites
• http//www.house.gov http//www.senate.gov)
• 1 Sep Read K ch. 2 determine which statements
  are facts, myths or beliefs on slides 30-32
  briefly explain.

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Fall 2005 Class-defined Issues (not prioritized)