To be fair, the use of synthetic N was seen as a boon in the early days as a way to increase yields. Agricultural systems are inherently deficient in N and I'm sure this was initially seen as a great way for folks to produce more food and thereby increase their incomes (plus the incomes of those making the fertilizer :). N use in the USA is fairly judicious since it is an expensive input and farmers do most things in their power to make sure they are using it efficiently. Like you pointed out though, the use of organic sources of N have many more benefits to soil quality that you just don't get when applying chemical N, benefits that can provide stability to the system. If you want to learn more about how N is used and managed in organic systems check out eOrganic's article on the subject: http://www.extension.org/article/18657.
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