Notes CH 26 Part 3
The Farm Becomes a Factory – The Mechanization of Agriculture and agri-businesses
America becomes the WORLD’S BREADBASKET AND BUTCHER SHOP - the Farmer struggles
Farming during the Gilded Age changed dramatically….from raising their own food, making their own clothing, and bartering for other goods…now they were quickly being drawn into the Capitalist Industrial American System…
High Prices at this time for certain crops encouraged farmers to cultivate “CASH CROPS,” [wheat & corn for ex.] and use their PROFITS….to buy food at the GENERAL STORE…and manufactured goods in TOWN OR BY MAIL-ORDER {Sears & Montgomery Ward- 1st mail order catalogues sent in 1872}
Farming became for many, but not all, a BUSINESS…that required SPECIALIZATION…they became cogs in a vast Industrial capitalistic economy… THEY HAD TO BUY – MACHINES….TO COMPETE….these machines were used to plant and harvest crops…
The speed and pace of farming life changed dramatically…as well as the needed business acumen required to run a LARGE FARM…and COMPETE with the WORLD…agricultural market.
The “Twine-Binder” and the “Combine” were examples of COSTLY MACHINES necessary to turn A PROFIT and each FARMER WAS RESPONSIBLE TO “MANAGE” ALL OF HIS BUSINESS IN A FIRST CLASS MANNER….
Most Farmers in this day were often unskilled as businesspeople and were inclined to blame BANKS AND RAILROADS…or the VOLATILITY of the MARKETPLACE…rather than their own shortcomings as businesspeople.
THE MECHANIZATION OF AGRICULTURE CAME SWIFTLY
Driving many farmers off their ancestral lands….and into the industrial urban workforce
Those farmers who would survive achieve miracles of production
THE FARM WAS BECOMING A FACTORY…run properly…ex. 1- BONANZA Wheat FARMS in the Minnesota-N.Dakotas….by 1890 there were 6 farms over 15, 000 acres each… OR…ex. 2- the Giant farms in California, irrigated and phenomenally productive…carved out of Giant Spanish-Mexican Land Grants and the RR’s Huge Land Holdings….”a country of plantations and estates,” with the INVENTION OF THE REFRIGERATED RR CAR – California Fruit and Vegetable crops could be sold in the rich urban markets of the east…
THIS FORESHADOWS THE BEGINNINGS OF THE GIANT AGRI-BUSINESSES OF THE FUTURE….
Deflation Dooms the Debtor
Farmers in the West who “chained” themselves to ONE-CASH-CROP…were now in the same boat as Farmers in the South who were in the same situation, tied to the Cotton Economy…
AS LONG AS PRICES STAY HIGH everyone is happy….BUT…IF THE PRICES FALL people are miserable…
In the 1880’s – PRICES CRASH*****SO FARMERS CRASH******* what would be the result?
Agricultural prices ARE DETERMINED IN A WORLD MARKET…BY WORLD OUTPUT…..so, if crops flourish in other Countries….and SUPPLY IS INCREASED….without a corresponding increase in DEMAND….PRICES FALL…
And in the 1880’s and 1890’s PRICES CRASHED…thus AMERICAN FARMERS CRASHED…
Two issues were the chief concerns of farmers at this time…
LOW PRICES AND DEFLATED CURRENCY
Example:
Effect on loan from prices falling:
If a family had borrowed 1,000$ in 1855 when wheat prices were 1$ a bushel…they would expect to have to pay back 1,000 bushels of wheat +INTEREST….so about 1250 bushels of wheat….
If the Family was to wait to pay back this debt….say to 1890….when wheat was at 50 cents a bushel…then they would have to pay their loan back with 2,000 bushels + INTEREST….
Effect on loan from deflation:
Since the amount of currency decreased prices went down even more….IF INFLATION WERE TO OCCUR SAY DUE TO AN INCREASE IN THE $$$ SUPPLY BY USING ‘GREENBACKS’ OR ‘SILVER’ …prices would increase and they would need fewer bushels of wheat to pay back their loan + INTEREST…
Thus, the dichotomy…the Nations Monetary choices favored the Creditor-Banker- Industrialist…the Industrialist was protected by INCREASED TARIFFS ON IMPORTED MANUFACTURED GOODS…KEEPING THEIR GOODS PRICES ARTIFICIALLY HIGH and increased immigration keeping their LABOR COSTS LOW…but….to the FARMER WHO HAD TO BUY THESE OVERPRICED GOODS it was another case of BAD NEWS…AND DUE TO THE MONOPOLISTIC BUSINESS PRACTICES OF RR’S AND OTHER COMPANIES…harvester trust, combine trust, barbed wire trust…THE FARMER ALSO HAD TO PAY MORE TO MOVE HIS CROPS, BUY MACHINES TO PLANT AND HARVEST, AND DO WORK AROUND THE FARM….
IN THE END THE FARMER FELT THAT THEY WERE BEING EXPLOITED AND MANIPULATED BY EVERYONE….What the heck??? What was the Farmer to do…..????
They increase production – purchase more machines - to be able to pay off their debt…BUT THIS IN TURN INCREASED SUPPLY WHICH LOWERED PRICES EVEN MORE… AND THEY STRUGGLE TO PAY OFF THE DEBT WHICH THEY INCUR BUYING MORE MACHINES…a hateful cycle….. What was the Farmer to do???
BANKRUPTCY---for many…By 1890, Nebraska alone counted more than 100,000 farms with mortgage loans….and when you can’t pay the loan….the Auctioneer comes to sell the family farm…and YOU leave.
On top of all of these problems…Banks charged outrageous INTEREST RATES – from 8 to 40%...(todays rate for a mortgage are around 3 -5 % depending on your credit score)
Farmers felt as if they were at the mercies of the unscrupulous Banks and Wall St …Octopus….
Tenant Farming or Sharecropping began to spread…The trend was alarming in the South, especially due to the sinking prices of Cotton…
By 1880 25% of all American Farms were run by TENANTS-RENTERS-SHARECROPPERS….
THE USA FED THE WORLD….BUT …WHO MADE THE PROFIT….AND WHO DID ALL OF THE WORK???
UNHAPPY FARMERS
EVEN MORE BAD NEWS FOR FARMERS…
Mother Nature, always fickle, sent mile-wide clouds of grasshoppers to destroy crops…or the Cotton Boll-Weevil to inhabit and destroy the cotton crops…Floods, erosion, expensive fertilizers, DROUGHT….
Whole towns were abandoned….”In God we trusted, in Kansas we BUSTED,” “Fifty miles to water, A hundred miles to wood, to hell with this damned country, I’m going home for good.”
TAXES…Local, State, and National all increase…land was over assessed….Wealthy businessmen paid no land tax, no personal income tax, or business tax…Stock was not taxed…High protective tariffs protected their prices..
Farmers made up ½ of the population in 1890…but they were disorganized…The Manufacturers and Railroad Owners knew how to combine to promote their interests…and did so…into huge monopolies that flowed $$$ into specific elected officials hands to keep their interests protected…Industrial workers began to Unionize to protect their interests, as well…
But the Farmer, by nature independent and individualistic…and separated in rural areas…were not effective in organizing….YET !!!
WHAT THEY DO IS MANAGE TO ORGANIZE A MONUMENTAL POLITICAL UPRISING!!!
THE FARMERS TAKE THEIR STAND
In 1868, during reconstruction, farmers protested when prices fell…and joined the “Greenback Labor Party,” and were not very successful in pressing the issue…of…demanding inflation of the currency by using paper $$$$.... 14 were elected to Congress IN 1878, but…eventually disappear… as a political force.
The National Grange of the Patrons of Husbandry (still exists today)– better known as – THE GRANGE….is organized in 1867. Led by Oliver H. Kelley, a Minnesota farmer then a clerk in DC….
Its 1st objective-was to enhance the lives of isolated farmers through social, educational, and fraternal activities.
The Grange spread and by 1875 claimed 800,000 members most in the mid-west and south.
2nd objectives – was collectives…in a determined effort to escape the monopolists control …they established cooperatively owned stores for consumers and cooperatively owned grain elevators and warehouses to store their crops…
3rd objectives– they eventually get into politics…in Illinois, Wisconsin, Iowa, and Minnesota….and were successful in getting legislation passed to regulate railroad rates and storage fees charged by railroads and owners of grain elevators and warehouses….. Munn v. Illinois in the 1870’s ruled these state actions[ CALLED GRANGER LAWS] that regulated business in the interests of the people constitutional…..INITIALLY…but in the 1880’s in the WABASH cases they overturn these actions of State Govt’s claiming that the Fed. Govt ONLY can regulate interstate commerce…
THE GRANGE STILL EXISTS TODAY…BUT THEIR POLITICAL POWER LESSENED AFTER THE WABASH CASES IN 1886…
Note:
SO…the Grange and the Greenback Labor Party both are early post-war attempts by farmers to address their needs…primarily to ask for Inflationary money policy and regulation of monopolies in the interests of the people…they have some fleeting successes BUT…AS THEY TIMES GET WORSE….IN THE 1880’S AND 1890’S …their protests and organizations increase in size and influence…as we will see…
Prelude to Populism
The Farmer’s Alliance is founded in Texas in the 1870’s….Farmer’s initially came together to socialize, but….growing discontent…led to them wanting to:
Break the stranglehold of the RR’s and Manufacturers through cooperative buying and selling (like the grange)…Local Chapters spread throughout the South and the Great Plains during the 1880’s and by 1890 they had over a million members….
The Farmer’s Alliance weakened itself by ignoring the growing number of “Sharecroppers” or “Tenant Farmers” (same thing) and Farmworkers…AND Even more disabling was its EXCLUSION OF BLACKS…1/2 OF THE FARMING POP. IN THE SOUTH…
The Blacks create their own “alliance” in the 1880’s called the Colored Farmer’s National Alliance and had 250,000 members in 1890….
THE LONG HISTORY OF RACIAL DIVISION IN THE SOUTH MADE IT DIFFICULT FOR WHITE AND BLACK FARMERS TO WORK TOGETHER IN THE SAME ORGANIZATION….(violence, lynching, etc…)
********A new political party emerges in the early 1890’s THE PEOPLES PARTY….****************
This party emerges from the Farmer’s Alliance of the 1880’s….THE POPULISTS***********
THE POPULISTS – ATTACKED WALL STREET AND “MONEY TRUSTS” [called the Ocala or Omaha Platform]***************know both names**************
- Called for Government ownership of the RR’s, Telephone, and Telegraph
- Called for a Graduated Income Tax
- sub-treasury plan for using crops stored in Govt warehouses as a basis for loans
- called for free and unlimited coinage of silver
REMEMBER THERE IS MUCH MORE IN CH 23 PART 2 NOTES…A FULL LIST OF THE “OCALA OR OMAHA PLATFORM” YOU NEED TO KNOW THESE********
-WILLIAM HOPE HARVEY’s Book, “ Coin’s Financial School,” became a bestseller, and illustrated with woodcuts…that were part propaganda…FOR THE FREE COINAGE OF SILVER…{SEEN BY FARMERS AS THE ANSWER TO THEIR ECONOMIC TROUBLE…IT WOULD CAUSE INFLATION AND RAISE PRICES}
The story tells of “little professor” Coin Harvey outsmarting the Bankers and Economists with arguments on behalf of Free Silver….
-Ignatius Donnelly was another who spoke out in support of Populism…a Minnesota Congressman…
-Mary Lease, “Kansas Pythoness,” [pic p. 616 text] stated that POPULISTS…..should, “raise less corn and more hell.”
In 1892, the POPULISTS proved they were a direct challenge to the TWO established parties, Democrats and Republicans, by wining several congressional seats, Governorships, control of state legislatures in the South and mid-west…and even JAMES B. WEAVER…earned more than 1 million votes in that year’s presidential election.
Weaknesses…Racial Division in some states, not in others….BUT…THIS TOO WAS SOON TO END, temporarily…AS THE POPULISTS GOAL FOR 1896**************TO TEAM UP WITH THE INDUSTRIAL WORKERS AND TAKE OVER THE GOVERNMENT FOR REGULAR MIDDLE CLASS PEOPLE*************
COXEY’S ARMY AND THE PULLMAN STRIKE – Eugene Debs, leader of Union after strike becomes the leader into the next century of a GROWING SOCIALIST PARTY….********
The Panic of 1893….**********
The economic panic erupting in 1893….and the ensuing depression that followed HELPED THE POPULISTS CAUSE********AND GAVE THEIR GOAL FOR 1896 A HUGE BOOST OF MOMENTUM:
TO TEAM THE FARMERS WITH THE INDUSTRIAL WORKERS***********
***This is the story of the allegorical “Wizard of OZ”…. {oz. is short for ounce, Tinman-ind. worker & Scarecrow- farmer etc….
Coxey’s Army (pic p. 617 text)- the depression of 1893 (panic) caused mobs of unemployed workers to march…(worst depression of the 19th century) to protest their struggles…
Jacob S. Coxey, a wealthy Ohio quarry owner, in 1894, organized a March on Washington…(the 1st ever organized…but when they get to DC it was hardly a march…so it is not considered the 1st mass protest)
A large group of dissatisfied citizens and reporters documenting their struggle was supposed to descend on DC…
THEY WANTED:
The US govt to relieve unemployment by an inflationary public works program, supported by 500$million in “legal tender notes” (greenbacks) to be issued by the US Treasury… (they would have to wait for another 40 years for this…during the New Deal in the 1930’s)
His Army…”We’re coming Grover Cleveland, 500,000 thousand strong, We’re marching on to Washington to right the nation’s wrong.”
In reality: Coxey’s army was TINY..and they were arrested for “walking on the grass”…not making much of a protest….
But….violence erupted in other places… CHICAGO – 1894 – THE PULLMAN STRIKE**************
EUGENE V. DEBS LEADS THE ,,,,,,AMERICAN RAILWAY UNION – 150,000….MEMBERS ON STRIKE !!!
The AF of L declined to support the strike…”cowards”…
WHY?
The Pullman Palace Car Co… in which its employees lived in a MODEL Company Town…Cut wages by 1/3rd and kept the RENT on the Company owned houses that every employee had to live in THE SAME.
Violence…RR cars overturned …RR Traffic from Chicago to the Pacific Coast was paralyzed******* [this gave the federal government the excuse –interfering with the delivery of the mail – to CALL OUT THE US ARMY…AND …GET THE COURT TO ISSUE AN INJUNCTION (ORDER) TO END THE STRIKE….
Pres. Cleveland, “if it takes the entire Army and Navy to deliver a post card in Chicago, that card will be delivered.”
The Court issued the injunction and the US Army troops were dispatched…
Interestingly, the Governor of Illinois…felt that the situation was not out of hand and did not need TROOPS…. They came anyway….
Troops fixed with Bayonets on the ends of their rifles…crushed the strike…DEBS WAS SENTENCED TO 6 MONTHS IN PRISON FOR VIOLATING THE COURT ORDER (INJUNCTION) TO CEASE STRIKING…
Union leader Eugene V. Debs was thrown in jail for 6 months – “ The issue is Socialism versus Capitalism. I am for Socialism because I am for humanity.” He learns of Socialism in Prison…and later leads the US Socialist Political Party….and earns over a million votes while running for President later…1900’s.
Response of Labor….Protest of “government by injunction”…THIS WAS THE 1ST TIME THAT SUCH A LEGAL WEAPON HAD BEEN USED BY WASHINGTON DC-FEDERAL GOVT- TO BREAK A STRIKE…
STRIKERS COULD BE IMPRISONED WITHOUT A JURY TRIAL…
POPULISTS AND OTHERS WERE UPSET AS WELL….PROVING AN ALLIANCE EXISTED BETWEEN BIG BUSINESS AND THE US GOVT & COURTS…AT THE EXPENSE OF THE PEOPLE********
Golden McKinley and Silver Bryan
The Election of 1896 –
Conservatives, Creditors, Wealthy, Monopolists….ALL FEARED AN IMPENDING REVOLUTION…
Workers, Debtors, Farmers, poor….wanted political help to solve the economic crises…
The issue: Monetary Policy….Conservatives want the Gold Standard and Deflation
….Populists and Democrats want Silver and Inflation
Republicans Nominate William McKinley from Ohio…he was a Civil War Vet, former Congressmen, sponsored the High Tariff named after him….and supported DEFLATION AND THE GOLD STANDARD.
Rep’s also have help from the “wizard” Mark Hanna, election campaign manager for Mckinley….
Hanna believed that the prime function of Government was to aid business…He believed that prosperity –“TRICKLED DOWN”---from the Wealthy to the “masses”…HANNA RAISES HUGE $$$$ FROM THE CORPORATIONS TO KEEP TARIFFS HIGH AND THE GOLD STANDARD…AND NO REGULATION OF BUSINESS…THIS $$$$ IS THE law on unintended consequences…due to the Pendleton Act passed after Garfield’s assassination… candidates running for office would increasingly turn to corporations to fund their campaign’s…
The Populists and Democrats BOTH NOMINATE …WILLIAM JENNINGS BRYAN…*******
A new “Moses” appears in Bryan, young congressman from Nebraska…36, and he gives the speech of his life—called the “CROSS OF GOLD SPEECH”--- “You shall not press down upon the brow of labor this crown of thorns, you shall not crucify mankind on a cross of gold.””***********************huge************
The Democrats nominate Bryan after the speech…they demanded the “unlimited coinage of Silver” at a ratio of 16 oz of Silver to 1 oz of Gold… (the market was about 32 to 1) This meant that the silver dollar would be worth about 5o cents…and inflationary….
Democratic –Gold Bugs – left their party over the silver issue….and voted for McKinley
The Populists had a dilemma… because the Democrats had taken their silver issue…MOST ENDORSED A FUSION WITH THE DEMOCRATS….(except in Va and NC where the Populists fused with Republicans- who supported silver) THE POPULISTS ALSO NOMINATE …WILLIAM JENNINGS BRYAN….