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Ag Policy Exam 3
Terms in this set (87)
What influence did the Federal budget situation have on the drafting and passage of the Agricultural Act of 2014?
-It had changes from 2008, limiting spending on programs, conservation title expenditures were reduced.
-Most expensive were Food & Nutrition expenditures and Crop Insurance. Shifted from commodity support to risk management and insurance were implemented.
What was the intent of the 1996 farm bill with regard to future farm bills?
To buy out commodity programs, end them and "wean" farmers off government subsidies. The 1996 was supposedly going to be the last farm bill, although it wasn't.
What was the reason behind policy changing from quotas and allotments to base/established yield?
That producers' approving required referendums contained some level of uncertainty. Base allowed a more reliable supply estimation and budgetary certainty.
What are the four shortcomings of base?
1. Farmers responded to high market prices by increasing the production of base eligible crops.
2. Increased supplies of base program commodities
3. Monoculture practices to maximize payments had environmental impacts.
4. Land prices were bidded-up, and made entry into farming more difficult.
____% of the World Population is in Asia, but ____% of the food is in North America and Europe.
Exponential growth is expected to ____ over the next 40 years to become about ____ people by 2050.
slow, 9 to 12 billion
Sanders suggests that ______ is/are the key(s) to resolving world hunger.
economic development and education
Macroeconomic policy is composed of two type, what are they? Define.
Monetary: policy conducted by the Federal Reserve
Fiscal: policy conducted by the government
What 3 reasons did Sanders give for macroeconomic policy being important to agriculture?
1. Most of US ag is capital-intensive and relies on borrowed funds.
2. Most of US ag families work off the farm and rely on nonfarm jobs
3. US ag commodities are heavily exported and rely on global economic situation
6 reasons ag policy reform are important in trade because of:
1. protectionism favors inefficiency
2. increased business efficiency
3. more variety is available
4. reduces costly disputes between countries
5. costs decline for taxpayers
6. consumer and producer welfare improves
A weaker dollar makes US goods _________ to other countries, US exports _________ competitive, and US imports _________ expensive.
cheaper, more, more
A stronger dollar makes US goods _________ to other countries, US exports _________ competitive, and US imports _________ expensive.
more expensive, less, less
What does the AA of 2014 reauthorize?
all international food aid
and export market promotion programs
Since the ongoing failure of the current WTO, recent US presidents have done what?
shifted to bilateral and regional trade agreements
What is an import quota?
The maximum quantity or value of a commodity allowed to enter a country during a specified time period, and is applied to protect domestic producers.
What would motivate a country to import rather than produce a good?
Price and availability:
If a good is cheaper to purchase/import than it is to make and/or if the country lacks the resources to produce the good itself.
*What is Trade Promotion Authority?
Name nontariff barriers to trade.
Quotas, embargoes, sanctions and levies
*What are two future trade challenges to US domestic trade policy in the early 21st century?
What 4 reasons justify government involvement in food policy issues?
1. market failure
3. distributional inequities
4. food safety
What program, provided through the AA of 2014, distributes fresh fruits and vegetables to schools and service institutions?
Department of Defense, Fresh Program
What health problem is classified as a disease, and not a cultural problem by the AMA?
What food policy does the House Agriculture Committee have jurisdiction for? What does it not have jurisdiction for?
SNAP, Food Stamps and International food aid.
No jurisdiction for: school lunch program
What was termed "the most sweeping reform of our food safety laws in more than 70 years" according to the FDA?
The 2011 Food Safety Modernization Act
When was a food stamp plan first part of USDA programs?
___________ created a formal program for a food stamp plan for the first time and later became a farm bill title with the __________.
The Food Stamp Act of 1964, Agricultural and Consumer Protection Act of 1973
The Agricultural and Consumer Protection Act of 1973 was made possible by a winning coalition (a compromise) between:
Liberal urban democrats who wanted food stamps for strikers AND conservative rural southern democrats who wanted higher payment limits and support for cotton
What were two precursors to the farm bill food stamp turned government-purchased cattle into canned meat for the needy in the depression?
the Agricultural Adjustment Act of 1933 and the Jones-Connally Act of 1934
What is the Global Food Safety Initiative?
An industry initiative independent of government to improve food safety and ensure consumer confidence.
What percentage of people favor funding of food safety by the government?
How many people get food borne illnesses each year?
48 million with 128,000 hospitalized
How many people die from food borne illnesses each year?
How many regulations does it take to deliver a cheeseburger to the consumer?
With respect to food expenditures in the US:
1. What is the share of disposable personal income?
2. How much are food expenditures per person per year?
3. How much does food stamps (SNAP) provide per recipient per day?
How many participants are not expected to work (disabled, children, elderly) or are working with SNAP?
SNAP: Do only a few or most participants stay in the program for only a short time?
most only use it short-term
SNAP: How many people did SNAP keep out of poverty?
4.7 million, including 2.1 million children
SNAP: How many SNAP households include children, elderly or disabled?
SNAP: Can participants use SNAP to buy alcoholic beverages or tobacco?
no, strictly prohibited
The Agricultural Act of 2014 provides for how much of its funding to go to food stamps and nutrition programs?
79.1 (approximately 80%); $756 billion
What is the food safety federal program that has been in effect over a decade that relies on the food processing companies to find and monitor critical points in the processing process?
HACCP: Hazard Analysis and Critical Control Points
What does the current farm act say about lottery winners receiving food assistance, and college students using benefits?
-Lottery winners CANNOT receive food assistance
-College students CANNOT misuse benefits
The study of the national economy as a whole; involves the level of economic activity, including employment and output.
What caused economic success in the 1990s? (5 reasons)
1. Federal Reserve decisions
2. Clinton-GOP Congress decisions
3. World economy improving
4. State and private response to macroeconomic environment
5. Trade agreements
What caused economic failure from 2001-2008? (5 reasons)
1. High federal and trade deficits, lack of regulatory oversight
2. High oil prices
3. "irrational exuberance"
4. Housing meltdown; financial market abuses
5. Weak global markets
What caused economic recovery from 2009 to present? (3 reasons)
1. Fed. Gov't intervention (very limited); Fed. Reserve keeps interest rates down
2. Consumers regain confidence; inflation a non-issue
3. Partial private sector reinvestment (domestic and foreign)
Describe Trump's proposed agricultural budget for 2018.
-Down 5 percent
-Limit subsidies to farmers, including a cut in gov't help for purchasing crop insurance.
-Limit environment program spending
-Limit rural development programs
-Total spending: $132.3 billion
-Congressional approval for $18 billion
Whats the difference between deficit and debt?
Deficit: Government receipts or revenue MINUS government spending.
Debt: Government borrowing to pay obligations. Currently at $19 trillion.
What are the 7 basic
propositions of trade?
4. Economic Growth
7. Standard of Living
T or F: Export changes don't change farm net income.
True, they are only influential factors.
What modern acts modified permanent legislation for trade?
1950s/1960s: tariffs mostly left behind
What is Market Access Program (MAP)?
Cost-share assistance to eligible U.S. organizations. MAP funds are used for generic marketing, participants must contribute a minimum 10% match. For promotion of branded products, a dollar-for-dollar match is required.
How much of imported food is sampled by the FDA?
Less than 1%
Define the problem of food nutrition and obesity.
Obesity has been classified as a disease. There is an increasing widespread concern that Americans, more specifically children, are not eating nutritiously and is resulting in a epidemic.
Identify key alternate solutions to the food nutrition and obesity.
1. Approach the health problems that stem from unhealthy eating and physical activity simply as individual concerns requiring individual treatment.
2. Recognize there are social influences that affect what we eat, how we live and how healthy we end up- long before entering the doctor's office.
What are alternate solutions to food nutrition and obesity?
1. Status Quo- SNAP, WIC, public and private research and education. Success in reducing hunger, some success in improving health in the poor.
2. Free Market- reducing nutrition program spending in hopes the private sector will pick it up. Benefits those who can afford it.
3. More gov't- Aggressive research can result in breakthroughs in obesity. Causes, therapies and responses to improve health.
Define public policy (12 points.)
How many U.S. households were food secure throughout the year?
How do you define rural?
Often hard to define, based on location and purpose.
1. How many Americans lived in a metropolitan county?
2. How many Americans lived in a micropolitan county?
3. How many Americans lived in a non-core county?
What percent of Oklahoma population lives in metropolitan areas?
What geographically area of Oklahoma are most of the farming dependent counties located in?
Northwest and Southwest
How many counties in Oklahoma are water recreation-dominant?
What factors contributed to the success of the Cowboy West and free range cattle in the 1860s? (4 reasons)
1. free range and native grass
2. few rail shipping points west of Kansas City
3. few packing/processing plants west of Chicago
4. European and Eastern US wealthy investors
What caused the demise of the cattle "kingdom?" (3)
1. Barbed wire and end of free range
2. fragile native grassland over-grazed
3. bad weather
What were results of the idea that government spending was a solution to severe market failures such as the Great Depression? (3)
1. Keynes provided economic theory
2. FDR provided political action
3. WW2 massive government spending on the war machine proved Keynes and FDR right
Who campaigned on "less government is better" but presided over the biggest tac increase ever, with federal spending increased?
What key factors make the economy grow and work? (3)
2. Business investment
3. Government spending
Expanding monetary and fiscal policy will like result in: (2 outcomes)
1. increase inflation
2. increase exports
What happens when government spending is greater than government revenue?
What is the accumulation of government borrowing to pay obligations?
Taxes, as a share of GDP for the US are:
among the lowest in the world
Over time higher tax rates typically cause economic growth (GDP) to __________ and federal debt to ________.
The fundamental proposition of trade is that increasing trade leads to increased ______________.
If changes in government programs reduces funding for food stamp programs, how will that likely impact staple food consumption initially, assuming all other factors are constant?
Demand for food, rather than supply, will change.
According to the text in chapter 11, the current farm act does what? (3 reasons)
1. Authorizes funds to alleviate veterinarian shortages in rural areas
2. Reauthorized the National Aquatic Animal Health Plan
3. Reauthorized programs for forest health, water quality, wildlife habitat and soil productivity
Major changes in the Nutrition Title of AA2014 included what? (4)
1. wage verification
2. cuts in utility assistance
3. more food bank funding
4. funding for food program policing increased
A lack of coordination of the 15 food safety agencies presented difficulties for who?
importers and exporters
Veterinarians are paid special attention in AA2014 because:
Vet shortages in rural areas
AA2014 added __________________ to the Farmer-to-Consumer Direct Marketing Act of 1976.
According to a recent survey, ________ of the public would trust a farmer to advise them on food safety or types of food they should be eating.
less than 20%
US food expenditures per capita/per day:
_______% of SNAP participants are either working or not expected to work (disabled, children, elderly, etc.)
_______ % of new SNAP Working-age & non-disabled adults work within a year of receiving benefits
______% of AA 2014 funding is planned to food stamp (SNAP) and nutrition programs
______% of US households were food secure in recent data
FDA samples _________% of food imported into US
less than 1%
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