Today I am signing into law the "Agricultural Adjustment Act of 1980," a measure that will help maintain the economic viability of our farm economy without contributing to food price inflation.
The immediate risk of farm price disasters falls upon farmers. But the longer term risk of the collapse of farm prices falls on consumers, through production interruptions and price increases for meat, milk, and fiber. This bill increases our protections against such interruptions.
This bill extends the disaster payment program, which covers a portion of the losses associated with crop failure, and imposes a new limitation on the amount of such payments.
The bill also amends, in two significant ways, the landmark Food and Agriculture Act of 1977. First, it adjusts the level of income protection made available to those farmers who participate in the commodity programs authorized by the 1977 act. This adjustment has been made necessary by the very rapid increase in the cost of producing wheat and feed grains. While the level of protection made possible by this authority is still below the total cost of production, it does provide protection for farmers in the event of depressed market prices. And it does this without government action that would raise prices or fuel inflation.