HaCKeRz KrOnIcKLeZ 3/HaCKeRz_KrOnIcKLeZ.iso/anarchy/essays/schoolsucks/agr.txt

Text File | 1996-04-27 | 9KB | 131 lines

Agrarian Discontent in the Late 1800's
        "Why the Farmers Were Wrong"

        The period between 1880 and 1900 was a boom time for American
politics.   The country was for once free of the threat of war, and many
of its citizens were living comfortably.  However, as these two decades
went by, the American farmer found it harder and harder to live
comfortably.  Crops such as cotton and wheat, once the bulwark of
agriculture, were selling at prices so low that it was nearly impossible
for farmers to make a profit off them.  Furthermore, improvement in
transportation allowed foreign competition to materialize, making it
harder for American farmers to dispose of surplus crop.  Finally, years
of drought in the midwest and the downward spiral of business in the
1890s devastated many of the nations farmers.  As a result of the
agricultural depression, many farm groups, most notably the Populist
Party, arose to fight what farmers saw as the reasons for the decline in
agriculture.  During the last twenty years of the nineteenth century,
many farmers in the United States saw monopolies and trusts, railroads,
and money shortages and the demonetization of silver as threats to their
way of life, though in many cases their complaints were not valid.

        The growth of the railroad was one of the most significant
elements in American economic growth.  However, in many ways, the
railroads hurt small shippers and farmers.  Extreme competition between
rail companies necessitated some way to win business.  To do this, many
railroads offered rebates and drawbacks to larger shippers who used their
rails.  However, this practice hurt smaller shippers, including farmers,
for often times railroad companies would charge more to ship products
short distances than they would for long trips.  The rail companies
justified this practice by asserting that if they did not rebate, they
would not make enough profit to stay in business.  In his testimony to
the Senate Cullom Committee, George W. Parker stated, ...the operating
expense of this road...requires a certain volume of  business to meet
these fixed expenses....in some seasons of the year, the local business
of the road...is not sufficient to make the earnings...when we make up a
train of ten of fifteen cars of local freight...we can attach fifteen or
twenty cars...of strictly through business.  We can take the latter at a
very low rate than go without it.  Later, when asked the consequences of
charging local traffic the same rate as through freight, Mr. Parker
responded, Bankruptcy, inevitably and speedy....  While the railroads
felt that they must use this practice to make a profit, the farmers were
justified in complaining, for they were seriously injured by it.  A
perfect example of this fact can be found in The Octopus by Frank Norris.
 A farmer named Dyke discovers that the railroad has increased their
freight charges from two to five cents a pound.  This new rate, ...ate
up every cent of his gains.  He stood there ruined. (Doc. H).  The
railroads regularly used rebates and drawbacks to help win the business
of large shippers, and made up this loss in profit by increasing the cost
to smaller shippers such as farmers.  As a result, many farmers, already
hurt by the downslide in agriculture, were ruined.  Thus, the farmers of
the late nineteenth century had a valid complaint against railroad
shippers, for these farmers were hurt by the unfair practices of the
railroads.

        Near the end of the nineteenth century, business began to
centralize, leading to the rise of monopolies and trusts.  Falling
prices, along with the need for better efficiency in industry, led to the
rise of such companies as Carnegie Steel and Standard Oil, which
controlled a majority of the nations supply of raw steel and oil
respectively.  The rise of these monopolies and trusts concerned many
farmers, for they felt that the disappearance of competition would lead
to erratic and unreasonable price rises that would hurt consumers.  James
B. Weaver, the Populist partys presidential candidate in the 1892
election, summed up the feelings of many Americans of the period in his
work, A Call to Action:  An Interpretation of the Great Uprising.  He
wrote, It is clear that trusts are...in conflict with the Common law.
They are monopolies organized to destroy competition and restrain
trade.... Once they secure control of a given line, they are master of
the situation... They can limit the price of the raw material so as to
impoverish the producer, drive him to a single market, reduce the price
of every class of labor connected with the trade, throw out of employment
large numbers persons...and finally...they increase the price to the
consumer.... The main weapons of the trust are threats, intimidation,
bribery, fraud, wreck, and pillage.  However, the facts refute many of
Weavers charges against the monopolies.  While it is true that many used
questionable means to achieve their monopoly, many were not out to crush
competitors.  To the contrary, John D. Rockefeller, head of Standard Oil,
competed ruthlessly not to crush other refiners but to persuade them to
join Standard Oil and share the business so all could profit.
Furthermore, the fear that the monopolies would raise prices unreasonably
was never realized.  Prices tended to fall during the latter part of the
1800s creating what some have called a consumers millennium.  Thus,
the agrarian complaints against monopolies were not incredibly valid, for
the monopolies did very little harm to farmers of the time.

        Finally, deflation and falling prices during the late 1800s led
to the most heated complaint of farmers and the Populist party that grew
out of agricultural discontent.  Deflation had been running rampant
during the latter half of the 1800s, as evidenced by the drastic fall in
the value of wheat and cotton.  To fight the deflationary trend, the
Populists demanded a reversal of the Coinage Act of 1873, which
demonetized silver.  The Populist platform for the 1892 election called
for unlimited coinage of silver and an increase in the money supply to
no less than $50 per capita..  Here again, the farmers are wrong in the
assessment of their problems.  It is true that the countrys money supply
was not adequate.  United States government data from 1961 shows that
though the countrys population between 1865 and 1875 increased by nearly
four million, the countrys money supply actually decreased.  However,
many farmers used the money supply to explain problems that indeed had
very little to do with the money supply at all.  This fact is best summed
up in a quote from J. Laurence Laughlins article, Causes of
Agricultural Unrest.  He says, Feeling the coils of some mysterious
power about them, the farmers... have attributed their misfortunes to the
constriction in prices, caused, as they think, not by an increased
production of wheat throughout the world, but by the scarcity of gold..
 Furthermore, history has shown that battle between gold and silver had
little real meaning.  The real battle was not between gold or silver, but
instead what would be done to check deflation.  William McKinley, in his
1896 acceptance speech, said, Free silver would not mean that silver
dollars were to be freely had without cost or labor... It would not make
labor easier, the hours shorter, or the pay better.  It would not make
the farming less laborious or more profitable....   Many farmers saw
silver as a cure-all for their problems, failing to see that changes in
the world were to blame.  Finally, the discovery of gold in Alaska and
improved methods of extracting gold from low-grade ore did much to
increase the nations money supply.  These facts prove that the farmers
view of silver was not sound, thus invalidating their complaints about
the nations financial system.

        The farmers of the late 1800s had many reasons for being
dissatisfied with their situation.  Unfair railroad practices, such as
rebates and drawbacks, hurt them severely.  However, in some cases, these
farmers complaints were not justified.  Many of the fears that farmers
had about monopolies, such as the idea of unfair and unreasonable price
increases, happened in very few occasions;  in fact, prices went down in
the latter part of the nineteenth century.  Finally, history has proven
that their view of silver as a way to end deflation and the decrease in
crop values was inaccurate.  The farmers of the period, though, used
these issues to change the shape of American politics and bring it face
to face with the problems the country was facing.