Farmers and Populists

In the late 1880s, many farmers were trapped in a vicious economic cycle.

Prices for crops were falling, and farmers often mortgaged their farms so they could buy more land, buy more farm equipment, and produce more crops. Good farming land was becoming scarce, though, and banks were foreclosing on the mortgages of increasing numbers of farmers who couldn’t make payments on their loans. Moreover, the railroads were taking advantage of farmers by charging excessive prices for shipping and storage.

What does this movie have to do with American farmers in the late 1800s?

Keep paying attention and see if you can figure it out‌

Farmer’s Problems -weather problems • Drought and storms cause crops to fail – lose money -falling prices • Farmers not making enough money -increasing debt • Farmers cannot pay for loans; banks foreclosing -dependant upon railroads • Railroads over-charging farmers; no stopping

“What you farmers need to do is raise less corn and more hell!” ~Mary Elizabeth Lease

Farmer’s Problems -need for cheaper money • Farmers want to increase the money supply so farm prices will increase deflation and inflation

Throughout the 1870s, farmers and other debtors pushed the government to issue more money into circulation by using not only gold, but also silver, to back up the nation’s money supply. This way, there would be more money in circulation, and they would get more for their farm goods.

Railroad Abuses -construction graft • Railroads making secret deals -bribes • RR agents take money to allow for cheap shipment -stock watering • Livestock drink water to make weight increase “There are three great crops raised in Nebraska. One is a crop of corn, one is a crop of freight rates, and one is a crop of interest. One is produced by farmers who sweat and toil the land.

The other two are produced by men who sit in their offices…and farm the farmers.” ~ Nebraska Newspaper Editorial

-unfair pricing long haul: cheaper short haul: more expensive -use of rebates for large customers (get money back)

The Grange – farmers organize -also called the Patrons of Husbandry -began as social group and education group -evolved into political group -regulation of railroads -“Granger Laws”- mid-western state laws that regulated railroad abuses -Granger laws ruled unconstitutional in Wabash v.

Illinois, 1887 -ICC- Interstate Commerce Act -Federal law regulates commerce -currency reform: Want to increase amount of money in circulation (gold and silver)

“We believe that the time has come when the railroad corporations will either own the people or the people must own the railroads.” ~Omaha Platform, 1892

Populism – People’s Party -took the place of the Grange • Influenced Democrats -strong mid-west support -reform based party • Want changes -Omaha Platform, 1892 increase $ supply: gold AND silver money “That we oppose any subsidy or national aid to any private corporation for any purpose.” ~Omaha Platform, 1892

income tax (graduated)

secret ballots 8 hour workday Immigration control

During the Civil War, the U.S. issued almost $500 million in paper money, called greenbacks. Greenbacks could not be exchanged for silver or gold money. They were worth less than hard money of the same face value.

Hard money included both coins and paper money printed in yellow ink that could be exchanged for gold.

After the war, the government began to take the greenbacks out of circulation.

Retiring the greenbacks caused some discontent. It increased the value of the money that stayed in circulation.

It meant that farmers who had borrowed money had to pay back their loans in dollars that were worth more than the dollars they borrowed.

At the same time, they were received less money for their crops, since a bushel of wheat fell from $2.00 to $.68. Farmers lost money at every turn.

What Exactly Do The Populists Want?

1.

Coin Gold and Silver  Increase the Money Supply

2.

Increase the Money Supply  Inflation (Prices Go Up)

3.

Inflation  Borrowers (Farmers) Are Better Off; Lenders (Banks) are Worse Off

Why would some people question if bimetallism would work?

Free Silver Crusade -Panic of 1893 • Farmers in deep debt -nation enters a recession -many promote silver and gold standard for currency (bimetallism) -would create larger money supply -”greenbacks” issued based on silver and gold bullion reserves -Gold standard only would limit money supply as gold reserves were limited: everyone would have less money, but each dollar worth more

Populists promoted “free silver,” in which money would be backed by gold and silver rather than gold alone. This would increase the money supply and lead to inflation, the rise of prices, which would allow them to charge more for their farm products and pay off their rising debts. However, each dollar would be worth less than if backed by gold alone.

Here Are Examples from Today: INFLATION: •I have one candy bar. What are you willing to pay me for it?

•I have many candy bars. What are you willing to pay for one?

•This is like the value of your dollar. The more dollars you have, the less they are worth.

What has happened to prices since the 1890s? Why?

Here Are Examples from Today: HOW INFLATION HELPS AND HURTS: •One side of the room are borrowers and one side are lenders.

•The borrowers have 6 coins and the lenders have 11.

•If a candy bar costs one coin, figure out how many you can buy.

•Now, lenders need to give three coins to a borrower. In one year they will pay you back the coins they borrowed, plus one.

•A year has passed and the money supply has increased, meaning prices have gone up. It now costs 5 coins to buy a candy bar.

•The borrower pays back the lender his three coins, plus one.

•Now, everyone calculate how many candy bars you can buy.

•How did borrowers turn out?

•How did lenders turn out?

•As a lender, what is your dilemma?

End of the Populists -1896 election -William McKinley-Rep. Gold Standard • Using only gold to back all money (worth more) -William Jennings BryanDem./Pop. Free Silver/bimetallism “Cross of Gold Speech” -McKinley wins election • People fear inflation and not being able to afford goods and services William Jennings Bryan delivering the “Cross of Gold” speech in Omaha

-Populism dies

“We reply that the great cities rest upon our broad and fertile prairies.

Burn down your cities and leave our farms, and your cities will spring up again as if by magic; destroy our farms and the grass will grow in the streets of every city in the country…”

“Having behind us the producing mass of this nation… we answer their demand for a gold standard by saying to them: You shall not press down upon the brow of labor this crown of thorns, you shall not crucify man upon a cross of Gold.”

William Jennings Bryan, Democratic Convention Speech, 1896

What distinction do you notice in the votes cast in 1896? Which sections of the country voted for which party?

William Jennings Bryan standing outside the White House after losing the Presidential election to William McKinley. Although he won many votes, Populism eventually dies out.

Symbolism of the Wizard of Oz Dorothy: America Tornado: Industry Land of Oz: Gold Wicked Witch of East: Banks Wicked Witch of West: Railroad Munchkins: Little People in America Yellow Brick Road: Gold Scarecrow: Farmers Tin Man: Industrial workers Lion: William Jennings Bryan Winged Monkeys: Plains Indians Emerald City: Washington, DC Wizard of Oz: William McKinley Slippers: Free Silver