AGRICULTURAL ADJUSTMENT ACT OF 1933 MAY 1933 AGRICULTURAL ADJUSTMENT ACT OF 1933 AGRICULTURE NEW DEAL U.S GOV'T LEGISLATIVE U.S GOVERNMENT AND CONSTITUTION ECONOMY AND LABOR IN MAY 1933 CONGRESS PASSED THE AGRICULTURAL ADJUSTMENT ACT AAA OF 1933 AS PART OF PRESIDENT FRANKLIN D ROOSEVELT'S NEW DEAL THE AAA WAS DESIGNED TO RESTORE FARMERS PURCHASING POWER FARMERS HAD SUFFERED FROM LOW CROP PRICES AFTER WORLD WAR I DECREASED NEED FOR FARM PRODUCTS AFTER THE WAR REDUCED PRICES BUT FARMERS CONTINUED TO OVERPRODUCE WHICH DROVE PRICES EVEN LOWER THE ACT ESTABLISHED PARITY PRICES FOR SEVEN BASIC COMMODITIES INCLUDING CORN COTTON RICE WHEAT HOGS AND DAIRY PRODUCTS IN 1934 THE LIST OF COMMODITIES WAS EXTENDED THE PARITY PRICES WERE BASED ON FARMERS PURCHASING POWER FROM 1909 TO 1914 THE AAA ALSO PAID SUBSIDIES TO FARMERS WHO REDUCED ACREAGE OR CROPS THE FUNDS FOR THESE PAYMENTS WERE TO COME FROM TAXES ON PROCESSORS OF PARTICULAR FARM PRODUCTS THE ACT ALSO ESTABLISHED THE AGRICULTURAL ADJUSTMENT ADMINISTRATION TO OVERSEE THESE PROGRAMS IN 1936 IN UNITED STATES V BUTLER THE U.S SUPREME COURT DECLARED THE PROCESSING TAX UNCONSTITUTIONAL THE CREATION OF SUBSIDIES WAS A LASTING FEATURE OF THE ACT
