Farmers on the Plains Early Success and the Reality of International Trade
Farmers’ Plight • Early Success Easy Credit Terms Railroads promoted land and credit • Several successful years for small and large commercial farmers – International business • Lots of rainfall and good crops worldwide • But gradually climate dried and land failed.
Farmers’ Plight • Supply rises, prices fall and farmers produce more, to make up in volume what they lost in price. • Big grain supply allowed railroads to hike prices on all farmers, cutting deeply into profits. • Borrowed “Cheap” money and heavily in debt. • Sought Government help through regulation
Farmers Fight Back! The Grange, Farmers Alliances and the beginning of Populism
Farmers Battle Debt • During Reconstruction (1875), Congress pulled money – Greenbacks - out of circulation - back to gold standard. • So money increases in value again – bad for farmers. • They had borrowed with ‘cheap money’ not backed by gold but must pay back with more valuable money that is based on gold. • Once again farmers push for ‘cheap money’.
High Expenses - Low Income • Railroad monopolies (no competition) allowed charging of any prices they demanded. • Secret deals with storage companies & middlemen on rates allowed agents to charge high prices to farmers. • Wheat prices fell in late 1870s when money increased in value AND when international competition increased. • Paying high prices for freight & receiving low prices for crops hurt profits and kept them in debt.
Farmers Unite! • Patrons of Husbandry - Oliver Kelley - 1867 • Grange – a farmers organization for education - Fight railroads’ high pricing - Teach farmers how to organize - Set up farm co-operatives - Elect officials to speak for their interests - Sponsor state legislation • Farmers Alliance – 4 Million Members
Rise of Populism • 1892 – Populist Party – formed in Omaha, Nebraska out of farmers’ alliance movement • Sought political power for farmers – supported… - Graduated income tax - Cheap money to pay debt easier - Federal loan programs - Restrictions on immigration - Direct election of senators - 8 hour workday • Important contributions to Democrats in later years
Populist Ideology • Challenged ‘laissez-faire’ capitalism. • Rejected idea that the rights of business ownership were considered absolute (do what they want). • Supported Industrialism and Capitalism but believed it was developing in brutal and chaotic ways. • Growth should be more guided by needs of people and their communities.
Populism and Bimetallism • Bimetallism – making currency based on silver and gold. • Free Silver - money exchanged for either metal makes more money available – and thus cheaper - because more silver than gold was available. (Debt repayment) • Big issue in Presidential Campaign of 1896 • William Jennings Bryan makes ‘Cross of Gold’ Speech • McKinley beats Bryan and Populism fades until Roosevelt