Beginning with the creation of the Department of Agriculture in 1862, the federal government took a direct role in agricultural affairs, going so far as to teach farmers how to make their land more productive. After a period of prosperity in the early 20th century, farm prices declined in the 1920s. The Great Depression of the 1930s drove prices still lower, and by 1932 farm prices had dropped, on average, to less than one-third of their 1920 levels. Farmers went bankrupt by the tens of thousands. Many present-day farm policies have their roots in the desperate decade of the 1930s and the rescue effort contained in the New Deal.
 

Today a maze of legislation embodies U.S. farm policies. On the theory that overproduction is a chief cause of low farm prices, in some circumstances the government pays farmers to plant fewer crops. Certain commodities can be used as collateral to secure federal loans, or "price supports." Deficiency payments reimburse farmers for the difference between the "target price" set by Congress for a given crop and the actual price paid when the crop is sold. And a federal system of dams and irrigation canals delivers water at subsidized prices to farmers in western states.
 

Price supports and deficiency payments apply only to such basic commodities as grains, dairy products, and cotton; many other crops are not federally subsidized. Farm subsidy programs have been criticized on the grounds that they benefit large farms most and accelerate the trend toward larger -- and fewer -- farms. In one recent year, for example, farms with more than $250,000 in sales -- only 5 percent of the total number of farms -- received 24 percent of government farm payments. There is a growing movement to cut back the government's role in agriculture and to reduce subsidies paid to farmers. Important economic interests defend current farm policy, however, and proposals for change have stirred vigorous debate in Congress.