1976-1985: A Decade of Pressure, Policy and Turning Points
A Look Back as ProAg Marks 100 Years, For Generations
By 1976, American agriculture was coming off a decade of growth in export markets and farm production. Many producers had borrowed to expand, land values had climbed and equipment needs continued to grow. But the optimism of the 1970s would soon run into high interest rates, rising debt and falling commodity prices.
This decade brought sharp changes for farmers, ranchers and rural communities. It also brought one of the most important crop insurance laws in U.S. history. As ProAg looks back during its 100th anniversary year, the years from 1976 to 1985 show how quickly agriculture can move from expansion to financial stress, and why dependable risk management matters
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Crop Insurance and ProAg History, 1976-1985
For the family business that trademarked the name ProAg during this timeframe, 1976 marked an important step forward. That year, Jess Benjamin “Benny” Latham III became vice president of Producers Lloyds Insurance Company. Over the next two decades, Benny, along with his father and brother, Larry Latham, helped expand ProAg into 40 states with more than 350 employees.
The biggest crop insurance milestone of the decade occurred in 1980, when Congress passed the Federal Crop Insurance Act of 1980.
Before this law, federal crop insurance had remained limited for more than 40 years. Coverage was available for certain crops and regions, but participation was low. USDA’s Risk Management Agency notes that crop insurance remained an experiment until the 1980 Act expanded the program to more crops and regions of the country.
The 1980 Act made several major changes. It authorized a premium subsidy equal to 30% of the premium, capped at the dollar amount of the 65% coverage level. It also expanded coverage to more crops and areas, and it allowed private insurance companies to sell and service federal crop insurance policies.
The goal was clear. Make crop insurance more affordable, expand access and reduce the need for repeated disaster assistance after major losses.
The law did not solve every issue. Farmer participation increased, but it did not reach the level Congress had hoped for. Still, the 1980 Act changed the direction of crop insurance by creating the public-private delivery structure that remains central to the federal crop insurance program today.
What Everyday Life Cost – 1976 Compared to 1985
Inflation shaped daily life during this decade. Energy, food, housing and borrowing costs all affected family budgets and farm operations.
| Purchased Item | 1976 Price | 1976 Price (Today’s $) | 1985 Price | 1985 Price (Today’s $) |
| Gasoline (per gallon) | ~$0.59 | ~$3.35 | ~$1.20 | ~$3.60 |
| Milk (per gallon) | ~$1.65 | ~$9.35 | ~$2.26 | ~$6.75 |
| Eggs (per dozen) | ~$0.84 | ~$4.75 | ~$0.80 | ~$2.40 |
| Average New Car Price | ~$4,100 | ~$23,200 | ~$9,200 | ~$27,500 |
| Median Home Value | ~$44,200 | ~$250,300 | ~$86,800 | ~$260,000 |
For farm families, these prices tell only part of the story. The bigger pressure came from operating costs, debt and interest rates. By the early 1980s, many producers were paying more to borrow money while commodity prices and land values weakened.
Presidents and National Leadership During the Decade
President Reagan addresses the Nation from the Oval Office on Tax Reduction Legislation
Three presidents led the country during a period of inflation, global tension and farm financial stress.
- Gerald Ford (1974–1977) led the country through the final years after Watergate and continued efforts to address inflation and economic uncertainty.
- Jimmy Carter (1977–1981) served during a period of energy pressure, inflation and growing concern in farm country. His administration also imposed the 1980 grain embargo against the Soviet Union after the Soviet invasion of Afghanistan.
- Ronald Reagan (1981–1989) took office as high interest rates and falling farm income placed heavy pressure on producers. His first term overlapped with the deepening farm crisis and the passage of the Food Security Act of 1985.
Defining American Events, 1976–1985
This decade brought moments that many Americans still remember.
- The United States celebrated its bicentennial in 1976.
- Elvis Presley died in 1977, marking the loss of one of the most recognized figures in American music.
- The Three Mile Island nuclear accident occurred in 1979.
- The Iran hostage crisis began in 1979 and continued until January 1981.
- The 1980 U.S. grain embargo against the Soviet Union disrupted export expectations for American agriculture.
- MTV launched in 1981, changing the way music reached American audiences.
- The first Farm Aid concert was held in 1985 as the farm crisis drew national attention.
Federal agricultural policy also changed during this period.
- The Food and Agriculture Act of 1977 continued target price and loan programs for major commodities.
- The Federal Crop Insurance Act of 1980 expanded crop insurance and brought private companies into the delivery system.
- The Agriculture and Food Act of 1981 continued commodity support programs during a difficult farm economy.
- The Food Security Act of 1985 created the Conservation Reserve Program and added conservation compliance provisions, including Sodbuster and Swampbuster.
Hear the Spotify Playlist for 1976-1985
Agriculture Faces the Farm Crisis
The early 1980s were among the hardest years in modern American agriculture, but the pressure did not arrive all at once.
During the 1970s, strong export demand and rising land values encouraged many producers to expand. Some bought more land, while others invested in machinery, buildings and inputs. Much of that growth was financed with debt, which became harder to service as interest rates rose. By late 1980, the U.S. prime rate reached 21.5%, making operating loans and land debt far more expensive for producers already dealing with weaker prices.
Then the market shifted. Export demand weakened, commodity prices fell and farmland values began to decline. The 1980 grain embargo added another strain by disrupting sales to the Soviet Union and raising new doubts about export markets farmers had been counting on.
Across farm country, the effects were personal. Some producers lost land that had been in their families for generations. In communities built around agriculture, rural banks came under pressure, and local businesses felt it too.
Original 1985 Farm Aid Concert photo from FarmAid.org
By 1985, the farm crisis had reached national attention. That year, Willie Nelson, John Mellencamp and Neil Young helped organize the first Farm Aid concert in Champaign, Illinois. About 80,000 people filled Memorial Stadium to hear artists including Bob Dylan, Billy Joel, Bonnie Raitt, B.B. King and Loretta Lynn. The concert raised more than $7 million for America’s family farmers and gave the crisis a national stage.
The 1981–1982 recession (referred by many as the 1980s Farm Crisis) made those pressures worse. The Federal Reserve describes it as the worst U.S. downturn between the Great Depression and the Great Recession, with unemployment reaching nearly 11% in late 1982. In farm country, the crisis lasted longer. Many rural areas continued to feel the effects through the mid and late 1980s as high interest rates, falling commodity prices, declining land values, reduced export demand and heavy debt pushed more producers into financial distress.
Congress also reacted in 1985 with the Food Security Act. The law continued commodity programs, created the Conservation Reserve Program and tied certain USDA benefits to conservation practices on highly erodible land and wetlands.
A Turning Point for Crop Insurance
For agriculture, this decade made one thing clear. Strong production alone could not protect a farm from falling prices, high interest rates, tight credit, export uncertainty or severe weather. Farmers needed tools that could help them manage risk before disaster struck, rather than waiting for ad hoc relief afterward.
The farm crisis changed how many producers thought about risk. Debt, credit, interest rates, markets, weather and policy could not be viewed separately anymore. They all affected whether a farm could stay in business.
That is why the Federal Crop Insurance Act of 1980 mattered so much. It expanded coverage, made policies more affordable through premium subsidies and brought private companies into the delivery of federal crop insurance. The law did not create the system we know today overnight. However, it changed the direction of crop insurance and laid the groundwork for the public-private partnership that continues to serve farmers and ranchers.
1966-1975: A Decade of Growth, Technology and New Markets