HISTORY HIGH SCHOOL

How did the New Deal policy of loaning money to farmers help create higher prices for farm goods?

Answers

Answer 1
Answer: The New Deal was the arrangement of government projects propelled by President Franklin D. Roosevelt in the wake of taking office in 1933, because of the catastrophe of the Great Depression, and enduring until American section into the Second World War in 1942. New Deal policy of loaning money to farmers help create higher prices for farm goods because the farmers got money making them more produtive
Answer 2
Answer:

Answering the question, the new deal policy of loaning money to farmers permitted farmers to produce fewer farm goods and therefore raising prices.

The passage of the agricultural adjustment act in 1933 was meant to reduce farm produce and boost agricultural prices.

Further Explanation

The federal law encouraged Americans who were still farming at the time to grow lesser crops so that there won’t be enough farm produce and the prices of crops will rise and therefore benefits the farmers.

The agricultural adjustment act also compelled the farmers to destroy their farm animals and crops. The government also paid subsidies to cotton farmers and were instructed to plough their crops back into the soil.  

The government also purchased six million piglets for slaughter and gave them out to the employed at no cost. The agricultural adjustment act also established a new agency to manage the distribution of subsidies to farmers.

The passage of the act benefited the farmers and stabilized the farming market; it encourages a rise in crop prices and also improves the lives of many farmers.

However, the agricultural adjustment act was declared unconstitutional by the United States Supreme Court in 1936 and this marked the end of the Agricultural adjustment Acts. (AAA)

Therefore, the new deal policy of loaning money to farmers permitted farmers to produce fewer farm goods and therefore raising prices.

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KEYWORDS:

  • new deal policy
  • farmers
  • subsidies
  • loaning
  • agricultural adjustment act

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