The Agricultural Adjustment Act intended to give farmers subsidies if they would limit their production of specified crops. The hope was that limiting production would improve crop prices and thus increase agricultural profits.
The Agricultural Adjustment Act (AAA) of 1933 was part of Pres. Franklin Roosevelt's New Deal program. A Supreme Court decision in 1936 (United States v. Butler) struck down the AAA as unconstitutional. The Court ruled that taxes imposed on processors of farm products in order to make the subsidy payments to farmers was not a proper tax, and that the act overall went beyond the powers of the national government. Subsequently, a modified version of the law was passed in 1938 to adjust the law to comply with the Supreme Court's ruling. Ultimately, the actions that were begun with the AAA in 1933 did have some impact on increasing crop prices.
