The Farm Crisis 1919–1923 [Reprint 2020 ed.] 9780520350533

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Farm Crisis 1919-1923

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Farm Crisis I

9I9~I9a3 JAMES H. S H I D E L E R

Berkeley and Los Angeles UNIVERSITY

1957

OF C A L I F O R N I A

PRESS

UNIVERSITY OF CALIFORNIA PRESS BERKELEY AND LOS ANGELES, CALIFORNIA CAMBRIDGE UNIVERSITY PRESS LONDON, ENGLAND © 1957. B Y THE REGENTS OF THE UNIVERSITY OF CALIFORNIA LIBRARY OF CONGRESS CATALOG CARD NUMBER: 5 7 - 1 0 5 0 2 DESIGNED BY JOHN B. GOETZ PRINTED IN THE UNITED STATES OF AMERICA BY THE UNIVERSITY OF CALIFORNIA PRINTING DEPARTMENT

THIS BOOK IS FOR

Sarah Margaret

Shideler

Preface

Study of the abiding farm question in twentieth-century United States history has directed my attention to the period 1919-1923 as a turning point in the great economic, political, and social trends of agriculture. As a result of an accumulation of ills and of sharp dislocations caused by World War I, particularly in its world economic position, agriculture was placed in a position of inequality and thrown into a long-lasting depression. This crisis damaged the agricultural industry and the farm population, altered the position of agriculture in relation to the rest of the economy, shifted ideas concerning rural well-being, and established definite lines of farm policy. T h e purpose of this study is to examine the changes that took place and the attempts of agriculture to improve its status through self-help and political action. T h e historical approach to the farm crisis, with its general view, should help the reader to recognize continuing problems and to plan for their correction or acceptance. This research has been aided by the many scholars who have preceded me in examination of themes relating to the period of agricultural crisis, 1919-1923. I am heavily in debt to those who are recognized in the notes and to others who have given information through their publications. I am grateful for the fine cooperation extended by the staffs of the Library of the University of California at Davis, the National Archives, the U. S. Department of Agriculture Library, and other libraries. Special thanks go to

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PREFACE

Mrs. Sara Schreiber of the Library of the University of California at Davis; the late Miss Stida L. Bane of the Hoover Archives at Stanford, California; Miss Josephine Harper of the Wisconsin State Historical Association; Miss Vivian Wiser, Harold T . Pinkett, and Carl J . Kulsrud of the National Archives; and Miss Billie Redding of the Western Historical Manuscripts Collection at the University of Missouri. Helpful assistance with the accuracy of some chapters was provided by Wayne D. Rasmussen, Vernon L. Carstensen, Gilbert C. Fite, and Henry C. Taylor. Much information was generously given through interviews and correspondence with a number of persons who participated in the events described in this book. T w o private collections of manuscript materials not previously open for research in agricultural history were kindly made available for this work: Henry C. Taylor opened the collection of his papers at the Wisconsin State Historical Association, and Herbert Hoover permitted study of many files relating to agricultural affairs in the Hoover Archives. A University of California faculty summer fellowship in 1953 and grants from the University of California Institute of Social Sciences facilitated the completion of this study. I am deeply indebted to many persons who have given assistance and encouragement, and, throughout, my best editor and partner has been Idella P. Shideler. T TT „ J A M E S H . SHIDELER

University of California Davis, California

Contents

i.

Agriculture on the Brink

1

INTRODUCTION AGRICULTURE'S " G O L D E N A G E " W A R T I M E CHANGES IN AGRICULTURE F A R M E R S AND G O V E R N M E N T , 1 9 1 9 - 1 9 2 0 T H E POSTWAR AGRICULTURAL O U T L O O K ,

2.

I919-I92O

Agriculture's Price Panic T H E P R I C E BREAK, J U L Y - D E C E M B E R ,

46 IG20

CREDIT SHORTAGE AND T H E F E D E R A L RESERVE " C O N S P I R A C Y " T H E RAILROAD-RATE ISSUE T H E " P R I C E D R I V E " T H E O R Y AND CROP-HOLDING RESPONSE CONGRESSIONAL I N A C T I O N

Farmer Self-Help

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T H E SEARCH F O R INDIVIDUAL SOLUTIONS CROP-REDUCTION SCHEMES AGRICULTURAL C O O P E R A T I O N

4.

The Cooperative-Marketing Remedy

95

MARKETING REFORM OPPORTUNITIES T H E SAPIRO " C O M M O D I T Y " M A R K E T I N G P L A N T H E GREAT GRAIN-MARKETING E X P E R I M E N T RECOGNITION AND ASSISTANCE F O R C O O P E R A T I O N

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X

5.

CONTENTS

The Harding Administration

118

PRESIDENT HARDING AND THE FARMERS SECRETARY OF AGRICULTURE HENRY C. W A L L A C E THE BUREAU OF AGRICULTURAL ECONOMICS AN AGRICULTURAL ADJUSTMENT PROGRAM CABINET CONFLICT

6.

Agricultural-Reform,

W A L L A C E AND HOOVER

Legislation

152

THE F A R M BLOC UNAVAILING AGRARIAN REFORMS PRICE-STABILIZATION PROPOSALS THE TARIFF QUESTION

7.

Winter, 1921-22

189

FARMERS IN ADVERSITY THE GREAT DISPARITY THE NATIONAL AGRICULTURAL CONFERENCE " E Q U A L I T Y FOR AGRICULTURE"

8.

Agrarian Revolt,

1922

217

ORGANIZATION OF AGRARIAN DISCONTENT MIDTERM ELECTION REVERSALS THIRD-PARTY SPECULATION THE FARMERS' CONGRESS

9.

Agrarian Movements,

1923

243

NEO-POPULISM COOPERATIVE MARKETING FOR AGRICULTURAL STABILIZATION THE W H E A T CRISIS OF I 9 2 3 EXPORT SUBSIDY FOR FARM RELIEF FARM-RELIEF POLITICS

10.

The Persisting Farm Problem

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CRISIS DAMAGE TO AGRICULTURE CHRONIC DEPRESSION AGRICULTURE AND POLITICS TOWARD A FARM POLICY

Bibliographical

Notes

297

Notes

303

Index

333

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Chapter I

Agriculture on the Brink

Between the beginning of 1919 and the end of 1923 there occurred a crisis in the business of agriculture, its social outlook, and its political behavior. In 1919 farmers, riding the crest of a boom, were being cursed as a cause for the "high cost of living," but at the end of the period farmers were grievously depressed, politically rebellious, and the object of deep national concern. Graphs of agricultural prices show an irregular trough, extremely high and steep on one side, 1919-1920; low in the middle, 1921; and a gradual but ragged slope beginning upward on the other side, 1922-1923. A wide disparity between the prices of farm products and other goods aggravated the price crisis. Although the rest of the economy also suffered depression, agriculture's collapse was a special adversity, going deeper and lasting much longer than the general postwar deflation. Introduction Lowered prices and purchasing power were outward expressions of ponderous changes for farmers, produced by the nation's transition from a rural-agrarian civilization to an urban-industrial society. T h e full force of grave problems in rural adjustment, delayed and intensified by World War I, was concentrated upon the postwar years; the decline was so swiftly ruinous that agriculture seemed about to be overwhelmed. Here was a crisis standing as a basic event in the history of American agriculture, and marking 1

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off the older, individualistic, exploitative cultivation from the modern industry that agriculture was becoming. It was a gulf between two worlds of American agriculture, an old world of soaring ambition resting upon expansion and land-value increment, and a new world of uncertainty distinguished by diversity, inequality, and contraction. This change carried with it a reversal of many familiar ideas about farming as a superior way of life and as a field of rich opportunity. Since the eve of the Civil War farmers had been subjected to a series of jolts, which demanded painful adjustment but carried promises of gain. T h e farmers' dreams of technological efficiency came close to realization as the crisis of 1919-1923 provided a compelling stimulus to the improvement of business methods and production techniques, but attendant problems stole away many joys of accomplishment. Heartening to farmers were savings achieved in the expenditure of labor for the production of crops, evidenced by their ability to support more and more of their urban brothers. T h e savings may have been entered to the account of city dwellers more often than to the account of farmers; nonetheless the savings were dramatic and the human gain was real. As agriculture's commerical organization was hastened, the farmers were entangled in an economic system where business and industry could command a larger share of the national income. T h e growth of marketing and transportation facilities, making possible new and larger demands for the products of agriculture, seemed to diminish the farmers' position to that of just a supplier of raw materials. Having nearly reached the limits of its acreage expansion, agriculture looked forward to freedom from dependence upon overseas markets but discovered that new productive capacity and slackened population growth thwarted automatic balance of production and domestic requirements. Agriculture freed the nation from the specter of inadequate food supplies but required other outlets. Although World War I expanded production, it also damaged foreign buying power and made surpluses unmarketable save at bargain-counter prices. In a time of myopic economic nationalism, dominance of a narrow business viewpoint, and the relaxations of "normalcy," the farm problem was not realistically assessed. Monumental dilemmas were adjustments between urban industry and a dispersed agricul-

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ture, and the precarious position of a surplus-producing agriculture enmeshed in world economic disorganization. Agricultural leaders and well-wishing friends of the farmers waited for natural economic forces to bring recovery, then rushed forward with ineffective remedies. Long-range planning for agriculture based on available knowledge was neglected because agriculture was supposed, by many, to be capable of caring for itself. Struggles for power over the making of policy crippled the farm program. Hastily formulated farm policies became established as dominant concepts and complicated the subsequent search for alternate means of rural betterment. Moving irresistibly in the direction of government price support, reform proposals were propounded in great profusion, from which would be drawn the major agricultural issues for the next generation. T h e role of government in agricultural affairs assumed new significance as agriculture's infirmity endangered other institutions and as it took on the unstable characteristics of other branches of the economy with their need for direction in the national interest. Here was the beginning of a new farm problem and the establishment of its claims upon the public attention. However, no comprehensive solution was discovered for the problems of a diverse agriculture unprepared for subordination to plan. T h e farm problem was to be with the United States for a long time, since neither the reluctant Harding administration nor subsequent ones were able to place agriculture in a satisfactory position within the nation; nevertheless, the farmers' fortunes became involved permanently and intimately with governmental favor. Agriculture's voice in political affairs acquired a new clarity and power as farmers developed a group sensitivity and gave hints of voting solidarity. Though often seemingly on the verge of revolt, farmers remained orderly and democratic in their political behavior. Attached to the two-party system with only an occasional third-party threat, the farmers by working within the major parties eventually achieved such protection as legislation could secure. Although it was presented with imperative demands for adjustment to unstable conditions everywhere, farming nonetheless remained small individualistic operations within a system emphasizing concentrated control. Agriculture was poorly coordinated in the national life and moved painfully along from crisis to chronic

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depression, a dangerously sick industry in an otherwise thriving decade. Farmers and planners for agriculture could not thenceforth be indifferent to the historical record of 1919—1923. Agriculture's "Golden Age" Prewar habits of thought about agriculture were hard to shake off during the postwar adversity, when a fresh evaluation of agriculture's accumulated maladjustments was needed. Before the postwar agricultural crisis raised serious questions on the place of agriculture in American life, farmers had enjoyed a state of wellbeing which excited their new aspirations for the permanent achievement of a middle-class position. T h e early years of the century, if not a golden age, seemed to herald one. Europe and America together provided an expanding and profitable market for the farmers' produce. T h e affairs of agriculture were outwardly more satisfactory than they had been for a generation, a buoyant faith in progress pervaded the country, and opportunities in agriculture assured young men a respectable calling as well as the accumulation of a competence. Although prosperity was qualified, the optimism of the time admitted no problems incapable of solution. American agriculture seemed to be reaching an end of its history of expansion. T h e most available and productive lands had become farms, and the farm population and the number of farms leveled off from previous rates of increase. Similarly, the productivity of agriculture was expected to have limits. It seemed to stand to reason that with agricultural expansion slowing down and urban population growth continuing at a rapid rate, production in the foreseeable future would seriously lag behind consumption in Malthusian fashion. Gains in production were moderate compared with the huge increases of the late nineteenth century, and these gains were seen to come not so much from new acres brought into farms as from gradually improving production methods and the greater efficiency of labor and machinery. The great contributions of the agricultural sciences and educational services were only just beginning to increase yields. Mortgage indebtedness was increasing fast enough to cause worry, but the value of farm land was growing more rapidly still. Debts were incurred in part for lasting improvements on farms, thereby adding to farm values, convenience, and productivity—whatever

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5

they added to the fixed costs of farm business. Fixed costs, bookkeeping, and cost accounting were new symbols of agriculture's continuing commercialization; but farm business was still mainly conducted in a traditional rule-of-thumb fashion at the individual level, just as farmers generally produced haphazardly for markets that were presumed to exist. Having undertaken a commercial agriculture to fill the consumption needs of nonfarmers, farmers became dependent upon distribution agencies, and these became increasingly intricate and costly during the new century. The processing of agricultural goods passed from the farms and neighborhoods to the food industry. The original producers were more remote from the consumers of their products, and they had emphatic and legitimate grievances against meat packers, grain traders, and cotton speculators. As a result, the middleman became an evil symbol of extortion. T h e growing cooperative movement early caught the attention of farmers with promises of economic betterment. T h e association of producers for business purposes offered an opportunity to balance advantages gained by organized business and to strike at the dishonesty of some middlemen. The logic and promises were persuasive, and the movement had secured the blessing of President Theodore Roosevelt's Commission on Country Life. With experience gained from the first wave of the cooperative movement during the Granger years, cooperation made further progress but remained in the kindergarten stage. If there was ever a period when agriculture enjoyed a wholesome relationship with commerce and manufacturing, it was the time before World War I when the advantages it derived from ascending prices were comparable to the advantages industry gained from protective tariffs. Discontent was at a low ebb. "There were problems to worry a b o u t . . . but they were for the most part problems of prosperity, not of adversity."1 This time was wistfully recollected and reexamined in later years as a standard for measurement of agriculture's depression or prosperity. Prices of farm products rose throughout the prewar period; from 1899 to 1910 farm prices had risen more than 89 per cent, a rate of increase more rapid than that for other commodities.2 Moreover, for about five years after 1910, agricultural prices—individually and generally—seemed to vary around the general price level with relatively small fluctuations.3

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The picture was nearly one of stability, balance, satisfaction, and economic justice as farmers understood it.* Yet revealing gauges of the farmers' moderate well-being were considerations of farm income and return to labor and capital. As businessmen, farmers earned less than other enterprisers. Per capita incomes for farm people consistently ran below those for the rest of the population, demonstrating a long-term low-level income situation for farmers, which stirred conjecture concerning the agricultural industry's chronic imbalance within the national economy. An economist in the Department of Agriculture wrote in 1913 that "a very large percentage of American farmers live on the interest of their investment and do not receive anything for their own wages."5 Socially, farmers in the early twentieth century were vaguely aware of the shifting components of the vaunted American standard of living. T h e new century was to see an amazing proliferation of those products of industry that entered into the standard of living: the telephone, auto, household conveniences, fashionable clothing, and ingeniously processed goods. Enjoyment of these good things depended upon substantial monetary incomes, a qualification excluding much of the rural population. Still, the mass standards of life in prewar years were considered to be mainly matters of food, shelter, clothing, and security. Therefore a low-level cashincome situation did not cause farmers to fall badly behind other social groups until those new twentieth-century standards of consumption were impressed upon the nation. "A good living and independence"—plenty of food, adequate shelter, enough clothing, and security—were the elements of rural well-being. "Good living" was only newly challenged by the material products of industry; and "independence," although endangered by debt and the forces of commercialization, seemed as secure as the family-type farm. On the political side, nineteenth-century agrarianism had run its course. A general picture of relative prosperity did not mean that there were no discontented farmers; agriculture was subject to too many variables for all farmers to be at the same level, but most farmers were satisfied to trust to the liberal reform program of the progressive movement. Where this had political strength it was based upon agrarian voters. Furthermore, in a time of increasing food prices and prospective shortages, doing something for the

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farmers to advance the general welfare had an appeal to urban as well as rural voters. Not until the Wilsonian "New Freedom" was it accepted that agriculture required more than the facilitation of democratic political processes, social uplift, and subsidized agricultural experimentation. In his first inaugural address, President Wilson perceptively pointed to "the things that ought to be altered," one of them being "a body of agricultural activities never yet given the efficiency of great business undertakings or served as it should be through the instrumentality of science taken directly to the farm, or afforded the facilities of credit best suited to its practical needs.... We have studied as perhaps no other nation has the most effective means of production, but we have not studied cost or economy as we should. T h e New Freedom program for agriculture was to bring substantially to completion the farmers' requests for legislation to help them overcome their disadvantages in a new economic world. This program of legislation, however, came at the end of the prewar period. It required time to become effective, and its efficacy was unproved before war created a different economic world and new sharp problems of adjustment. The shift in governmental emphasis to the economic side of farming was led by Secretary of Agriculture D. F. Houston, who secured congressional authorization for studies of marketing and for establishment of an Office of Markets. Further commercialization of agriculture, outmoding traditional practices, put a premium upon technical knowledge. T h e Smith-Lever Act of May, 1914, filled a recognized need for organized popular teaching in agriculture, directly to the farmers, outside the agricultural colleges. Complementing extension work was the SmithHughes Act of February, 1917, providing federal grants to promote agricultural education in public high schools. These two acts together provided a means for the conquest of agricultural problems by scientific knowledge. Banking and credits legislation fulfilled the desires of farmers for a more flexible currency and freedom from the "money trust." With the Federal Reserve Banking Act of December, 1913, farmers could expect that prices would be less at the mercy of currency supplies, that interest rates on their short-term obligations would be

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lower, and that loans would be more easily negotiated with local banks. Moreover, the Federal Reserve Board could exercise its great power to direct economic affairs, taking this critical area from haphazard influences and avoiding panics. A second memorable credit law was the Federal Farm Loan Act of July, 1916, which made mortgage credit regularly available to farmers, with payments on interest and principal often no more than previous interest payments. Reminiscent of nineteenth-century agrarian antimonopoly agitation was the new movement to regulate business and industry. This appealed to the farmers' sense of righteousness and was interesting also to them as consumers wanting competitive prices and as sellers desiring markets not manipulated to their disadvantage. T h e Federal Trade Commission, created by an act of September, 1914, investigated the "Harvester Trust," the Corn Products Refining Company monopoly, and the "Packer Trust," thereby putting businesses on the defensive and warning them that honesty was the best policy. T h e Clayton Antitrust Act of October, 1914, was another step in the control of improper business behavior. Because a defect of the Sherman Antitrust Act had been its applicability to farm cooperatives and trade unions owing to their form of organization, both agriculture and labor successfully pressed for protective exemption in Section 6 of the new law. The New Freedom addressed itself to the problem of farmproduce distribution and built a structure of reform in marketing channels. The Cotton Futures Act of August, 1914, and the Grain Standards Act of August, 1916, aimed to protect the seller from unfair trading practices that had enriched brokers and speculators rather than farmers. T o meet an old agrarian desire, the Warehouse Act of August, 1916, provided secure storage for farm products until they could be sold in an orderly manner after supposed seasonal gluts were absorbed and prices had improved, and producers received warehouse receipts with good collateral value for bank loans. Basic economic difficulties of agriculture were not cured by the New Freedom legislation, but so far as government was then allowed to give a helpful hand, farmers had been put on a fair basis for solution of their prewar problems. Satisfaction with legislation, general agricultural stability, and an atmosphere of progressive

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eradication of national ills combined to create a golden age for rural people. Not all farmers were satisfied that reforms of the progressive period and automatic progress would be sufficient. Farmers' political movements were a perennial growth, and in the early years of the century farmers revitalized old organizations and formed new ones, hoping to overcome their economic and political dispersion which they believed made them the prey of other interests. T h e Patrons of Husbandry, having done their work of reform in the 1870's and 1880's at the state level, learned that national industries must be harnessed by federal power. After the turn of the century the Grange turned its attention to problems of national legislation and quadrupled its membership. Markedly different in outlook from the conservative Grange was the Farmers' Educational and Cooperative Union, which brought together local farmer groups that had persisted in the Southwest since the Farmers' Alliance movement. After becoming a national organization in 1905 it expanded rapidly eastward through the South, later adding powerful state unions in the Middle West. The Farmers' Union worked toward the creation of a central farm lobby at Washington and emphasized the improvement of farm business through cooperative associations. Another prominent farm body in prewar years was the American Society of Equity, which appealed to farmers' desires to organize effectively to control prices of agricultural goods. Equity was responsible for a night-riding episode in Kentucky's tobacco fields. This gave a momentary control of tobacco marketing, but it damaged the farmers' reputation for civil order. Most politically aggressive among prewar farmers' movements was the Nonpartisan League, which took advantage of the new primary laws that had made the political parties vulnerable to aggression by any disciplined minority group. Its aims were clearly class-angled: the farmer was to gain a more substantial return by narrowing the "take" of the middlemen. State ownership of terminal elevators, flour mills, packing houses, and cold-storage plants was proposed as the core of the Nonpartisan League program. In the highly specialized and predominantly rural state of North Dakota, the League quickly registered political gains, in 1916 winning control of the legislature's lower house and electing a full slate of state officials. It swept on through the spring wheat areas and seemed

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about to embrace the whole western Mississippi Valley. Clearly establishing itself as a force in politics, it represented an effective voting group and merited the attention of national political leaders. Farmers' organizations in the prewar period performed valuable social and educational services, brought farmers together and gave them experience in association for commercial activity, and finally moved toward pressing the interests of the agricultural class upon the federal government. In 1915 President Barrett of the Farmers' Union appointed a committee to work toward united national legislative pressure, and the committee reported that other organizations favored consolidating forces for representation at Washington. Steps were taken toward unity of purpose at the twelfth annual convention of the Farmers' Union in 1916, and in July, 1917, there was founded the Federal Board of Farm Organizations, soon to become known as the National Board of Farm Organizations. With the creation of the Nonpartisan League and the National Board of Farm Organizations a new phase in agrarian politics began. Farmers would henceforth be vastly more concerned with class-interest legislation, and, by working within and upon the two major parties, would be better equipped to make their demands effective. Wartime Changes in Agriculture Without warning, the agricultural industry began in 1914 to experience a series of shocks quite as deranging as those following the Civil War, when agricultural mechanization, expansion into the West, and conflict with the new industrial order had kept agriculture in a state of uncertainty for nearly forty years. Now, during World War I, similar disruptions quickly developed, and in the postwar years farmers were presented with an accumulation of maladjustments. T h e importance of export outlets was demonstrated as record 1914 crops of cotton and wheat moved into trade channels at a moment of wartime market demoralization, especially severe for cotton. Expectations that America would be called upon to supply Europe with farm products at good prices were slow to be fulfilled. After initial interruption, export volume grew steadily in 1915 and 1916, but moderate price advances did not bring about great immediate expansion of either acreage or production. T h e winter and

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spring of 1916-17 saw the development of a food shortage and the entry of the United States into the war, changes vastly intensifying incentives to expand farm production and setting in motion other forces to modify the agricultural system. In 1916 it was apparent that the European war had become a long war. Reserve food in Europe was being exhausted; Allied purchasers, recognizing they could take no chances, began to bid with more determination for supplies. Uncoordinated until the middle of 1917, the Allies and the United States armed services bid against one another. Private purchasers, both legitimate and speculative, also were forcing up prices; and buyers for neutral nations with leaks to enemy powers completed the picture of competitive disorder. In modern warfare food is a critical material that vanishes in abnormal quantities. European demand was centered upon that nearest quarter of the world where supplies were in surplus and where production could be expanded—the United States and Canada. When United States participation became an actuality, the extraordinary food demand created a rush for possession of what was available. Gross agricultural production in 1916 and 1917 had actually fallen below 1914 and 1915 because of poor crop conditions. Therefore, in looking forward from the spring of 1917 to a dangerous food situation, it was clear that every effort must be made to conserve and allocate supplies and expand production in 1918 and 1919. Among foods, wheat was peculiarly a war munition because of its ease of preservation and handling and its high nutritive value.' During the spring of 1917, the current and prospective wheat shortage was reflected in rapidly rising prices. Wheat advanced from a 1915/16 average of $0.98 per bushel at the farm to $2.48 in June, 1917.8 Still higher prices, up to $3.48, were offered at terminal markets, and expectations were that wheat might go to $5 or more. Like grain, meat and meat products were in short supply and high in price. Until 1917 American production had increased slowly, without sharp stimulation from large export demand. European production had dwindled, fodder rations were established in Britain and France, and slaughter had decimated Allied herds. An accumulated need for meat resulted in 1917 in another upward spiral in prices—livestock, meats, and fats rising to 52 per cent above 1913/14 in 1917 and to 83 per cent in 1918.'

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Until August, 1917, there existed no legal power the government could use against the various food problems: stimulation of production, stabilization of prices at reasonable levels, allocation of supplies to points of greatest need, and conservation of insufficient goods so that they might be stretched to cover essential requirements. Efforts to solve each phase of the over-all food problem were profoundly important to agriculture, as its production levels, income expectations, and marketing channels were altered or disturbed by economic mobilization. Production could be stimulated and conservation enforced by free and soaring prices, but that would only complicate other phases of the problem. Herbert Hoover declared on May 19, 1917, that "we must maintain a price that will stimulate production by assuring good return to the producer," and that the cost of living must also be diminished "lest we face social readjustments, strike disturbances, with consequent loss of national efficiency."10 Food had to be controlled and production expanded. Development and administration of a food program were a responsibility Secretary of Agriculture Houston sought for his department. Agriculture, however, was nudged out of food control and left with production matters. A special wartime food agency was created for Herbert Hoover, who, with his experience in Belgian food distribution, was available to direct a control program. Elementary logic divided the Department of Agriculture with its traditional concern for production from the Food Administration with its emergency wartime control of distribution, but even before the war such a line was dissolving as farming became more commercial with interests in markets. President Wilson, announcing on May 19 that Hoover would be the chief of the Food Administration, outlined a program to stimulate production, protect consumers against high prices by regulating distribution and eliminating speculation, and conserve food by eliminating waste and substituting less critical foods for those in great demand. T h e president then requested authority of Congress to establish prices, "not in order to limit the profits of the farmers, but only to guarantee to them when necessary a minimum price which will insure them a profit where they are asked to attempt new crops."" Portentous for farmers was the Lever Act of August, 1917, which

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conferred upon the president a wide grant of power over food and set a minimum price for the 1918 wheat crop of $2 a bushel. T h e power of control was commensurate with the nature of modern war but was wholly strange to a representative democracy accustomed to peace. T h e Lever bill was a controversial measure because, though farmers wanted high prices, they correctly saw in the bill prospective controls over their incomes whereas they could see nowhere else a similar restriction upon incomes of others. Senator McCumber declared that "the farmers of the country have never been put on a parity, so far as their labor wages are concerned, with city labor." 13 As Congress faltered over food-control legislation Wilson, impatient to commence a program, instructed Mr. Hoover to begin mobilizing food-economy forces despite the lack of delegated powers, citing the dangers of delay in harnessing the nation's food resources.13 With these instructions, a great conservation program was begun by the Food Administration on a voluntary basis. Vast propaganda to the effect that "Food Will W i n the W a r " was sent out over the nation through all media of information, using new techniques of persuasion and advertising. A sample Food Administration poster carried the legend " T o farm is as necessary as to arm. Produce food; Conserve food; Dry and can food." Women were mobilized as conservation corps in the kitchen, clean-plate clubs were organized, pledge cards were hung up as reminders, and no part of the eating public was allowed to escape the campaign." Wheatless Mondays and Wednesdays and meatless Tuesdays were proclaimed, fresh fruits and vegetables were emphasized, and the newly discovered importance of "vitamines" was made a part of popular knowledge. It is not clear that wartime food conservation left a permanent imprint upon consuming habits; however, in the postwar years it was frequently cited as a cause for agricultural surpluses. In meeting the food problems raised by America's war involvement, the Food Administration pioneered in government planning and control for agriculture, creating a fund of experience for future use. In the beginning, the idea of economic control was objectionable to farmers as it involved their freedom to do husiness when, as, and how they pleased; but they were willing to receive guaranteed prices. Farmers were among the last to accept the regi-

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mentation required of modern businesses, but the war was a powerful impetus toward uniformity that did much to break down their resistance to economic modernization. Keeping prices up for the producer and down for the consumer were contradictory aims, which the Food Administration sought to reconcile by adjusting the distribution margin between what the producer received and what the consumer paid. Manufacturers and wholesalers were given certain definite profit margins; processing, shipping, and sales were standardized; and the major power of enforcement lay in a system of licenses backed up by vast consolidated buying and selling power. T h e marketing spread—large before the war—had increased with the rise in prices, with speculators, traders, and processors profiting from the wartime price spiral. Profiteering at the expense of the public, Hoover concluded, must be stopped. He proposed to act upon the view that any excess profit above peacetime levels was "money abstracted from the blood and sacrifice of the American people."" Determining in 1917 and 1918, however, a just peacetime profit level was a job of rather large proportions. Marketing of agricultural products entailed much duplication in handling and waste of time and wealth. T o Mr. Hoover's highly developed sense of orderliness there existed vast opportunities for service through enforced efficiency in distribution. "Orderly marketing" became a great goal for Mr. Hoover's public career, and the lesson of the war helped spread the idea through agriculture, making it also one of the farmers' favorite reform ambitions. On the farmers' side, the intent of the Food Administration was to maintain minimum prices, to be determined by the Food Administration in conference with the producers. The aim of "fixed" prices to the growers was to establish incentive levels that would guarantee costs of production plus a fair profit. Farmers criticized the Food Administration for setting prices at too low a level, despite farm representation on price-establishment committees. They said that the minimum prices were, in effect, price ceilings. T h e Food Administration did not formally fix maximum prices—Mr. Hoover was emphatic on this point—but the Food Administration's vigorous control of markets prevented price rises to farmers that certainly would have otherwise occurred. Hoover later pointed to augmented production as "proof of the just treatment of the

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15

farmer," assuming that increases would not have occurred without price stimulation." Wheat as a basic war commodity in acutely short supply was the object of special price-control attention from the Food Administration, and base prices were set, beginning with $2.20 for the 1917 crop. Price incentives and patriotic exhortation brought about the planting in late 1917 of a winter wheat acreage estimated to be more than 7,000,000 acres above the prewar average—the largest until then." Mr. Hoover had misgivings about the future effects of wartime wheat expansion: "The great present stimulation of wheat growing . . . by guaranteeing minimum prices may yet have something of the character of a national calamity."" Some farm representatives, however, were saying that the prevailing price was so low as to endanger future supplies. In January, 1918, there had begun in Congress a futile drive to increase the price for the 1918 crop. Many farmers felt thwarted by the price ceiling on a major crop, when the absence of artificial control would have brought them higher prices to compensate for previous lean years. A Montana farmer writing to the editor of Outlook posed the question: "Must the farmers be made to sacrifice all they have by limiting their prices while others grow rich?"1" Producers were doubtless impressed by statistics on supply and demand used to substantiate the necessity for conservation, and they had memories of uncontrolled market quotations of more than $3 in the spring of 1917. Here was a source of grievance that lingered among farmers and was to be recalled later in times of adversity. Much more important than a record of justice or injustice done to farmers were lasting changes in the level of wheat production occasioned by war policies. T h e nation had called upon farmers to raise two heads of wheat where one grew before. T h e short-lived, wartime emphasis upon wheat drew that large part of the agricultural industry into a position of imbalance requiring readjustment as war-born conditions changed. T h e years 1918 and 1919 taken together most clearly revealed the influence of the war emergency; wheat acreage was expanded 37 per cent over prewar years and production was increased 28 per cent." T h e wheat acreage of 1919 reached a record high point not to be surpassed until World War II. Closely approximating the critical requirement for wheat was

i6

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the need of the Allies for meat and fat. Mr. Hoover not only viewed with concern the immediate crisis, but also expected that Europe's need for protein and fats would be doubled in the after-war period when Europe "will demand the importation of animal products upon an even larger scale than during the period of the war."21 Since the food crisis could not wait two or three years for dairy herds to be enlarged and beef cattle to be grown and slaughtered, obvious emphasis fell upon hogs—a source of both meat and fat that could be multiplied in a season. Without the legal powers or the funds it had for controlling the price of wheat, the Food Administration undertook to establish a continuing high base price for hogs that would be a forceful incentive to increased production. Hog price fixing was a knotty problem, but, hearing ample encouragement from hog producers and packers that price fixing could be done, the Food Administration went ahead, against the advice of Secretary of Agriculture Houston.22 A hog price-fixing committee reported that the cost of producing a hundred pounds of live hog was the value of 12 bushels of corn. T h e committee recommended that there be guaranteed a hog price equivalent to 14.3 bushels, which would be an incentive to expand production 15 per cent as desired by the Food Administration. 28 T h e committee's idea of reasonable incentive pay provided a margin of 19 per cent. After arranging with the packers to maintain minimum prices, the Food Administration announced in November, 1917, that prices per hundredweight of hogs farrowed the following spring would be stabilized at a level equal to the price of 13 bushels of corn. T h i s announcement was conditioned: "It is not a guaranty backed by money. It is not a promise by the packers. It is a statement of the intention and policy of the Food Administration which means to do justice to the farmer."84 Despite the reservations in the Food Administration's statement, the producers understood that a commitment had been made, they assumed that the job would be done, and they set about responding to the inducement. Until the new crop of hogs appeared on the market the Food Administration manipulated hog prices, first to keep them from falling below $15.50 per hundredweight and then to limit the upward course of fluctuating prices.23 Conditions on the market suddenly turned in September, 1918, as the supply of maturing hogs expanded, reflecting the stimulated breeding of the preceding

A G R I C U L T U R E ON T H E BRINK

17

spring. A large hog crop, high corn prices, and a 13 to 1 assurance were elements of a situation the Food Administration felt it could not confront. Seeming to alter the price assurance, the Food Administration early in September, 1918, interpreted the price of corn to be not the price on the Chicago market, but the price on the farm, where feeding took place. Thus the average hog raiser would "lose" nearly $3 per hundredweight as a result of the change. This action created such a storm among the farmers that the ratio was abandoned and other means of price control substituted during the demobilization period. These shifts created ill-will toward Hoover, and grievances lasting into the following decade. Other agencies of the war government were working toward the goal of augmented farm production. During the war period actual and prospective demands for food so far outran current supplies and normal production that expansion became an important part of the war effort. President Wilson made it clear that "a nation in arms" meant also the farmer in arms. T h e farmer "is serving the country and the world and serving it in a way which is absolutely fundamental to his own future safety and prosperity."26 All means of persuasion and informative aid were used to encourage the farmer to greater production. Concrete problems of insufficient labor forces were met by the U.S. Employment Service in cooperation with the Department of Agriculture. As farmers moved into the armed services and urban war industry, city employees were mobilized into week-end farm labor reinforcements (or "Twilight Crews"), the Boys' Working Reserve and Women's Land Army were organized, and the Selective Service Administration provided draft deferments for essential agriculturists. Guiding agriculture's war contribution by means other than price stabilization and credit advances was the Department of Agriculture, which expanded its operations along all lines. Special funds for these activities were appropriated by the Food Production Act of 1917. An impressive need was demonstrated for a great number of basic investigations, especially in agricultural economics, as a foundation for wartime planning. Economic services and research were rapidly expanded and brought to the farmers through the extension service, which saw phenomenal growth. A lasting contribution made to agricultural improvement was the adoption by farmers of new scientific methods and of farm bookkeeping and

i8

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other business practices. T h e extension forces were very active in the organization of county farm bureaus. Expansion of farm production did not end suddenly with the laying down of arms in November, "1918; instead, forces set in motion by the war emergency and the sustained high demand from export markets, together with a persisting high price level, continued to swell agricultural production. T h e amount of land in farms increased about 9 per cent from 1910 to 1920, more than 77,000,000 acres being added. Of the land in crops, notable changes were made in its utilization. T h e alterations in machinery and routine which were made, as farms changed from corn to wheat or from cotton to corn, were not easily undone. Greater efficiency was indicated by expanding total crop production on more but poorer acres and with less fertilizer and declining farm-labor forces. An outstanding cause for increased output per worker was the more effective use of machines, prompted by labor shortages on farms. T h e government did not limit the manufacture of farm machinery; on the contrary, the War Industries Board encouraged agricultural implement companies to continue their regular production, in addition to their emergency manufacture of implements of war. A great service of the War Industries Board was its Conservation Division's attack upon the "differentiations and niceties of taste" in farm wagons, grain drills, and plow styles— the latter being reduced from 326 to about 76." Use of power machinery on farms was a revolutionary change, which had begun just before the war and received impetus during the war period. "Power farming" was to be a postwar phrase with great currency among farmers. Growing steadily was the vision of lightened farm drudgery, work done quickly when weather conditions favored it, increased production per man, and greater incomes from farm enterprises expanded to a businesslike scale of operation. Machines were still heavy and complicated, carrying the burden of experimentation in initial cost, operation, and upkeep. In 1920 more than 60 models of tractors were in large-scale production, some of them freakish in design and quaintly labeled—Bates Steel Mule, K. C. Prairie Dog, and Waterloo Boy. T h e total number of tractors had increased to 246,000, but the power revolution had barely begun. Before the war, agriculture's geographical characteristics had

AGRICULTURE ON THE BRINK

ig

been neatly balanced with the prevailing system of freight rates. Rising prices of farm produce, coupled with small increases in rates, widened profit margins for farmers and encouraged a dangerous geographical spread in production of heavy and bulky goods. As important as any other wartime agricultural change was the "great revolution" in prices and incomes. Traditional price levels were left far behind as farm commodity prices reflected the unusual demands caused by war, and major farm products rose in price about 140 per cent. Gross farm income from production rose to a long-term peak in 1919 of $16,953,000,000—152 per cent above the prewar annual average of $6,700,400,000—another record lasting until World War II." There were inevitable exceptions to farm prosperity, but not every farmer needed to be well off for agriculture to be considered prosperous. Whatever statistics might show, increased well-being for farm families was evidenced by the acquisition of twentiethcentury conveniences. These improvements became a virtual necessity to farmers returning to rural society from wartime urban employment and from military service with new standards of ease, cleanliness, and efficiency. Agricultural society gained also in selfrespect. Farmers, enjoying their indispensability, were reinforced in their conviction that agriculture was fundamental. However, farmers and their leaders resented the bureaucratic contempt they thought they detected for the ability of farmers to manage their own affairs and to be as patriotic and self-denying as other classes of the population. Feeling that justice would not automatically be done the farmers in devising emergency wartime economic controls, farm interests became more concerned about proper representation in governmental affairs. Farmers and Government,

1919-1920

A lasting effect of World War I was the entanglement of government in economic affairs and a distinct change of outlook in economic policy. Both government's concern with agriculture and the farmers' interest in government were henceforth matters of public issue. T h e lesson had been taught that if governmental policy could change the conditions of agriculture during a war emergency, government might also be used on behalf of agriculture during an economic emergency. Previously interested in the per-

20

AGRICULTURE ON T H E BRINK

fection of democratic procedures, abolition of special privilege, and control of monopolistic industry, farmers were now concerned with legislation to obtain direct benefits for agriculture equal to those secured by other industries. Farmers foresaw two postwar political problems: the disbanding of emergency government controls and programs, and the prevention of policies that would aid other economic groups at the expense of agriculture. Removal of government controls was in many ways a pleasant prospect for farmers who disliked such external restraints as daylight-saving time and who believed that price controls caused farmers to make unusual financial sacrifices to the war. Cutting back wartime agricultural extension work and special information services was not so attractive, for farmers had come to enjoy the friendly attention they were receiving. With the end of the war, the responsibilities of the Food Administration were limited primarily to the task of seeing its promised price supports run their course. Beyond this, government recognized no responsibility to producers involved in a higher level of production, but in both the short and long run the official view of outlets for American surpluses was optimistic. After the Armistice, the European food problem was no longer a matter merely of supplying the Allies but also of satisfying the greater hunger of Central Europe, where an estimated 20,000,000 persons were facing starvation. An American Agricultural Commission was sent to Europe in the early autumn of 1918 to survey possible Allied food needs for another year of war. Upon conclusion of the Armistice, the commission hurried home with reports indicating that demands would continue at wartime levels, and a member recommended that farmers and livestock producers "pursue a policy of moderate growth" since the European need would continue to be large and South American surpluses would soon be absorbed.28 When Herbert Hoover spoke to an assembly of Food Administration officials on the day following the Armistice, he expressed the belief that Europe with her "degenerated soils and depleted herds" would provide large demands for all available foods because Germany had "sucked the food and animals from all those masses of people she has dominated and left them starving.'"" Theoretically Europe needed all the world's surplus food, but obstacles stood in the way of joining supply with demand. Because

AGRICULTURE ON THE BRINK

21

of the prospect of difficulties in disposing of American surpluses, agriculture experienced a period of uncertainty and wavering prices in the winter of 1918-19. Responsibility for solution of the problem fell upon the shoulders of Food Administrator Hoover. He was the logical choice to direct United States relief activity in Europe because of his preeminent command of information and experience relating to food supplies. As Director of American Relief, Hoover also retained his authority as Food Administrator to control food exports. On November 16, 1918, he sailed for Europe to gain two large objectives: to open all that continent as a market for United States surplus foods and to succor the hungry populations as a first step toward reconstruction. T h e primary purpose of the relief program was to serve humanity, but the guiding authorities also had in mind the disposal of American food surpluses and the maintenance of price pledges. Secretary of the Treasury Carter Glass was eager to end the flow of loans abroad, but the Food Administration insisted that the Allies should not be limited in their ability to purchase food from the United States, because current surpluses, worth $1,500,000,000, must be exported to preserve the domestic market. In nine months the American Relief Administration handled 1,728,261 metric tons of relief supplies.81 Once channels were provided for its disposition, the worrisome surplus melted away, shortages appeared in American markets, and a frenzy of speculative inflation was stimulated. Little known among the farmers was Hoover's work to rid the nation of the dangerous oversupply of food and maintain the government's price obligations. They were more aware of designs to reduce the high cost of living by pulling down food prices. For about four months after the Armistice, commodity prices declined irregularly and agriculture restlessly anticipated serious losses. When, on January 9, 1919, the War Trade Board removed restrictions against the importation of corn, the expectation of imports from Argentina caused a break in the corn price. Farm journals cried "injustice" and began to propose tariff protection. At this point midwestern corn farmers and southern cotton glowers started campaigns for restriction of crop acreage. It was said that the farmer should engage in "sagacious sabotage" like big business and adjust production so as to hold prices up to costs of production. T o protect his interests the farmer was advised to organize, possibly in a

22

AGRICULTURE ON THE BRINK

national federation of farm bureaus. Crop acreage reduction agitations in the spring of 1919 were uneasy expressions of agriculture's uncertain future. In an atmosphere of price recession Congress expanded the War Finance Corporation in March, 1919, to aid agriculture by supplying credits for exports. Fearing that the markets for agricultural and other goods would be insufficient if exporters were not aided in their search for buyers, W F C Chairman Eugene Meyer, Jr., testified that resources of the Allies were used up and unless credits were extended they would be unable to buy.82 The unsteadiness of the immediate postwar months was further revealed in the difficulty of continuing the wheat price guarantee to cover the 1919 crop. At the time when wheat prices were obviously being held to the minimum of $2.26 by the Food Administration's Grain Corporation, Congress was called upon to appropriate funds for carrying this guarantee through to the middle of 1920, when the succeeding crop would become available.88 Advocates of lower food costs advanced a plan by which wheat price supports would be ended and the difference between the market price and the guaranteed price of $2.26 would be made good to the producer by direct payments from the Treasury. Secretary of Agriculture Houston subscribed to the idea, but this attack upon the wheat stabilization program roused horrified protests from agricultural interests, fearful that direct payments from the government to individual producers would involve endless red tape, and that the scheme would arouse public demand for repudiation of the guaranteed price. With the wheat farmers in the debate over maintaining the price guarantee were the Food Administration and the Grain Corporation, for Herbert Hoover and Julius Barnes were not ready to release control over foods. They argued that higher prices were to be expected from relaxed control and that indemnification to producers would be a complex problem involving probably fifteen million payments. In his testimony before the House Committee on Agriculture on February 5, Barnes stated the case for continued control over wheat. He contrasted the orderly procedures of the Grain Corporation with the opportunities for speculation and manipulation of prices to the disadvantage of both consumers and producers if controls were abandoned.11

AGRICULTURE ON THE BRINK

2$

That the wheat price guarantee would be redeemed was a certainty; the farmer vote was a force that neither political party wished to offend. The Wheat Stabilization Act of March 4, 1919, appropriated $1,000,000,000 to make previous commitments effective until June 1, 1920. T h e heavy autumn marketing season strained the ability of the Grain Corporation to maintain the price, but wheat did not go much below the guarantee during the 1919 crop year. Wheat Director Barnes played a masterful game of manipulation, and at the end of its period of operation he pridefully reported that the Grain Corporation, instead of showing the expected loss, had gained a profit for the Treasury. Maintenance of the wheat guarantee was a victory for agriculture, qualified, however, by rural suspicions that farm prices were repressed whereas the prices of nonfarm products had been allowed to rise. In the rough and tumble of economic conflict and rivalry for influence in government, agriculture was least able to defend itself. Farmers, urged to organize to protect themselves from the aggressions of "predatory interests," were attracted by a vision of organized agricultural power to adjust their economic, social, and political disparity. Early in the postwar period the new approach to farm organization was indicated by two leaders of agricultural opinion. Professor G. F. Warren in a paper read before the American Farm Economic Association January 9, 1919, declared that "this is an age of organization . . . so far the producers of food have been about the only unorganized persons. Because of the actions of other groups, farmers are being compelled to organize."83 Gifford Pinchot, speaking to the Corn Belt Meat Producers' Association in January, 1919, dwelt upon the inequality between unorganized farmers and their organized rivals. He urged the farmers to develop "an organization strong enough to speak with one voice for the farmers from one end of the nation to the other" because they would otherwise be unjustly treated by the "organized powers we have got to fight."86 The phrase "economic war" came to appear with regularity in speeches of farm leaders and columns of farm journals. During the year and a half following the Armistice, a time of new rigidity in class stratification, farmers saw themselves as a disadvantaged third group in the capital-labor struggle. Traditional impatience with city ways and a feeling that the city was unsympa-

24

A G R I C U L T U R E ON T H E B R I N K

thetic and uninformed respecting their views helped develop class consciousness and an incipient belligerence among the farmers. T h e picture of farm organizations in 1 9 1 9 was as varied and diffuse as agriculture itself. Although performing valuable services and responding to new trends in agriculture, existing organizations did not measure up to the needs of agriculture as an industry or class. A new farmer movement was needed to give focus to agriculture. Both the Patrons of Husbandry and the Farmers' Union, moving to represent farmers in Washington, fell short of representing the farmers as a whole. T h e Grange established at Washington January 1, 1919, a permanent office, thus expanding and solidifying the work it had done since 1885 by occasionally sending "legislative committees" to Washington. T h e class-conscious Farmers' Union pursued an attractive program of cooperative purchasing and marketing and exhibited a growing interest in national legislation. It was a loose-jointed and shambling group, now gaining, now losing ground. T o advance its legislative ambitions, the Farmers' Union maintained through President Charles S. Barrett a close connection with the National Board of Farm Organizations. T h e National Board proposed to do for farmers what the American Federation of Labor did for the workers and what the U.S. Chamber of Commerce did for business." It looked toward the unification of all important farmers' groups into a single federated body, with great power for the determination of governmental policy. When Charles A . Lyman opened new headquarters for the N.B.F.O. in Washington, he declared that the farmers had arrived to present their requests on an equality with labor and business and "here we are going to stay."" Another federated organization aiming to represent farmers in national affairs was the Farmers' National Council, a continuation of the Farmers' National W a r Council. Late in November, 1918, and early in January, 1919, it had held meetings in Washington for the purpose of reorganizing to meet postwar problems by applying pressure upon government and electing farmers to office.38 Designed as a Washington lobby, the Farmers' National Council was given a tone of insistent agitation by its leaders and was generally regarded as representing a ragtag assortment of equity societies, radical granges, and other fragments." Suddenly in 1 9 1 9 there appeared a new farm organization, larger

AGRICULTURE ON THE BRINK

25

and more powerful than any theretofore. T h e American Farm Bureau Federation, primarily a response to the farmers' demand for collective action, grew out of foundations laid before the war by the county agent movement and the local county improvement associations. From the state farm bureau federations and farm journals developed ideas of a great national federation, to be recognized as representing the farmers as they had never been represented before—a channel for making the real views of agriculture emphatically heard at Washington as a forceful instrument for securing economic justice. After an exploratory meeting at Ithaca, New York, in February, 1919, and a study by an organization committee, a national farm bureau organization convention was called to meet in Chicago in November. In spite of the doubts of a conservative southern and eastern contingent who wished the movement to retain its original educational purposes, the midwesterners put across a program of aggressive economic and political action. Completion of the American Farm Bureau Federation awaited a second convention in March, 1920, but in the meantime a goal was set to found a local farm bureau in every agricultural county and a federation in every state. By the time of the March meeting twenty-eight state federations had been founded, with a membership reported as 1,060,000, nearly double that of any other farm organization.41 A series of resolutions adopted in November indicated the drift of this new force. A general statement recognized "the economic law that impels the consolidation of business" and proclaimed that farmers' "relief from the extortion of monopoly in manufacture and commerce is to be found in cooperation." In the area of national legislation, the convention asked for government regulation of interstate corporations with enforced publicity of business records. Government ownership of public utilities was opposed, and the early return of railways to private control was demanded." T h e national farm bureau movement was obviously a development of vast potential consequence. More than just an adult educational system, the farm bureaus were at last an authentic voice for more than a small fraction of the farmers and an organization to which farmers and farm journals could direct the plea: "Someone ought to look into this." T o some friends of the movement, the new organization meant that "no longer will the American farmer

26

AGRICULTURE ON THE BRINK

weakly submit to being the scapegoat of either capital or labor."43 Before the middle of 1920 each of the leading farm organizations maintained permanent offices in Washington to promote the interests of agriculture. Benjamin C. Marsh for the Farmers' National Council, Thomas C. Atkeson for the Grange, Charles Lyman for the National Board of Farm Organizations, and Gray Silver for the American Farm Bureau Federation were familiar figures on the Washington scene, all noted for their tireless efforts. Farmers had arrived as a permanent influence upon the national government, but only a flimsy record of accomplishment was made during the first two postwar years. An issue that touched the American Farm Bureau directly was a proposed cut in the agricultural appropriation bill, which would reduce the funds for the Extension Service by $500,000,000. When protests from President J. R. Howard and Gray Silver of the A.F.B.F. restored most of the funds, the infant American Farm Bureau was convinced of the necessity for continuous vigilance in Washington." Other objects of farmer interest before Congress were proposals for short-term rural-credit facilities, emergency seed loans to distressed farmers in drought-stricken areas of the Northwest, completion of the Muscle Shoals nitrogen-fixation plants, and the St. Lawrence waterway project. These were all of secondary importance then, but were to reappear in Congress time after time with increasing emphasis. Farm organizations chose to squander much attention upon repeal of daylight-saving time. Whatever valid objections there may have been to it, farmers seized upon daylight saving as a symbol of urban caprice and imposition. Wilson's veto of a repeal bill caused such unanimous protest by farm organizations that a new repeal measure was passed over the president's second veto, August 20, 1919." If agitation over the hands of the clock was out of proportion to the advantage gained, the repeal showed the power that farmers could exercise if organized. Unusual rural interest came to be attached to legislation to free the cooperative-marketing movement from legal restrictions, which hampered the efforts of farmers to put themselves on an equal bargaining plane with organized business." Cooperative-marketing associations had sometimes run afoul of antitrust laws because of conduct that seemed to restrain trade, revealing Section 6 of the

AGRICULTURE ON THE BRINK

27

1914 Clayton Act to be insufficient protection for associations of producers.47 The Capper-Hersman bill, prepared by a committee of the National Board of Farm Organizations, proposed complete exemption from antitrust laws for farmers' associations. When the bill's progress was delayed in the spring of 1920, the farm groups concluded that the bill was being smothered and urged their members to "impress the necessity for this legislation on senators and representatives," but with no effect. A modification of the CapperHersman bill, the Volstead bill, received the support of major farm organizations and passed the House in May, 1920, but was lost by adjournment of Congress—to the great disappointment of farmers. It was carried over into the next session where further discouragements were in store. Legislation for control of the meat-packing industry was a prominent object of rural pressure upon Congress following the war. Despite opposition from the large packers and conspiracy to conceal facts from investigation, the Federal Trade Commission documented a history of malpractices that made control legislation imperative." The F T C offered recommendations of particular interest to farmers—that the federal government own and operate the stockyards and acquire railroad cars used for the transportation of livestock. These suggestions were reflected in packer-control bills, around which revolved a battle between the farm organizations and the packers. T h e Department of Justice became interested in the packers as contributors to an unnecessarily high cost of living; on August 6, 1919, Attorney General Palmer announced that a suit would be brought against them under the antitrust laws. A few weeks thereafter the producers were shocked to learn of a consent decree by which the packers would divest themselves of interests in retail foods, their market papers, and some of their stockyards, and the Justice Department agreed for its part to drop its suits. T h e process of gaining cease-and-desist decrees by consent was an unfamiliar legality, and a consent decree by which guilty parties escaped punishment violated sentiments of elemental justice. T h e decree, filed February 27, 1920, caused Congress to give new study to the problem of packer control, thus postponing legislation until a subsequent Congress. National railroad policy was a problem of somewhat larger

28

AGRICULTURE ON THE BRINK

importance to farmers than packer control. Government operation of the roads through the Railway Administration was a wartime expedient continued through 1919, while Congress grappled with the many knotty problems involved in getting the roads onto a permanent base. Farmers, as large shippers and receivers of freight, were vitally interested in railroad service and rates, but they were not prepared in the spring of 1919 to present a plan favoring their interests, being torn between their traditional antagonism to the evils of private management and the current irritations of poor service under government operation. Some farmers were attracted to the plan of G. E. Plumb, counsel for the railway brotherhoods, for public ownership of the roads. A Plumb Plan League, with ambitions for political power, attracted the support of the Farmers' National Council and the Nonpartisan League. Attractive were the league's promises that the Plumb plan would result in squeezing a great burden of water out of the road's capitalization and that lower rates would prevail. A t the end of the debate over legislation, farmers found themselves being forced to choose between labor's "Bolshevistic" plan and the Esch-Cummins bill, which appeared to be the proposal of financiers and railroad owners. Senator A. B. Cummins of Iowa, who had previously been noted for his Granger approach to railroad questions, sponsored the bill, which eventually became law. T h e Cummins bill was upheld by those farm groups who were most anxious to end maladministration of the roads by the Railway Administration; even private mismanagement, they considered, could not be worse. A provision of the bill little appreciated by the farmers at the time was a clause enunciating the principle that in future ratemaking, under supervision by the Interstate Commerce Commission, the roads should be permitted such rates as would allow a fair return. As a compromise measure, the Transportation Act of February 28, 1920, had few friends and was to become a source of much trouble for the farmers. T h e major farm organizations had allowed the bill to come into existence by default and had been herded into a negative support by their own fears, encouraged by a masterful job of public relations conducted by the associated railroad companies. Following their prejudices rather than their foresight, the insurgent fringe of the farmer movement, in combination with

AGRICULTURE ON THE BRINK

2Q

labor forces, made the Esch-Cummins Act a symbol of specialinterest legislation. T h e organized farmers had little more success in their representations before other branches of the government than they did before Congress. The Interstate Commerce Commission early in 1920 received a petition from the railroad operators, again in possession of their roads, pleading for general rate increases. Under the EschCummins Act the ICC was asked to grant rates alleged necessary to produce an annual return of 6 per cent upon the value of properties estimated by the roads to be $20,000,000,000." News of steps to increase freight rates caused the A.F.B.F. to hire Clifford Thorne to make a case for the "public" at the ICC hearings from May to July, 1920. His argument was vigorously presented, but it was a defensive movement. Thorne said that the commission's tentative valuation of railway property was $3,000,000,000 greater than the par value of all railway securities, which was in turn greater than their current market value. Furthermore, the carriers had not allowed for the depreciation of equipment in submitting their value estimates, and huge public land grants to the roads had been capitalized as part of their value.50 T h e representation of agriculture before the ICC helped bring about a reduction of 10 per cent in valuation, which, it was claimed, would result in a net annual saving of $30 to each farmer.51 T h e ICC in July, 1920, approved an advance in rates of about 35 per cent, with some broad regional differentials.62 Reflecting upon this rate change several years later, Commissioner J. J. Esch admitted "inequities and injustices," but the commission considered the increase the "only practical way in which to meet the roads' emergency."53 T h e difficulty in railroad affairs, however, was minor compared to the crisis that shortly developed as these great horizontal increases came to bear harshly upon an agricultural industry intimately entangled with a low rate structure. Farmers were especially irritated by the small attention accorded them by the National Industrial Conference of 1919, both in its selection of members and during its deliberations. T h e Industrial Conference was called by President Wilson to consider great national problems revolving around the high cost of living and critical labor-capital relations, which were disturbing to the nation

30

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during the period of reconstruction. Of forty-five members, only three were official representatives of agriculture: C. S. Barrett for the Farmers' Union, T . C. Atkeson for the Grange, and J. N. Tittemore for the American Society of Equity." T o farmers it was clear that the conference dealt with subjects that closely interested them as the consumers of labor's goods and the producers of labor's food. Agriculture was hardly even a side issue as the sessions were absorbed in the labor-capital quarrel, which resulted in early deadlock and adjournment. Farmers searching for favorable attention from government were rebuffed by the Department of Agriculture under Secretary Houston. Although large strides were made toward economic studies under his direction, he seemed unsympathetic toward investigations of a down-to-earth nature. Houston's resignation and replacement by E. T . Meredith in February, 1920, were regarded hopefully by the farmers, but they were to have harsh words for Houston's policies as Secretary of the Treasury. Since the beginning of the war President Wilson had had less time to devote to the cultivation of farm loyalty. In his annual message to Congress, December 2, 1919, he had only a little to say about reforms to aid the farmers, and he had no articulated national agricultural policy. Although the Democratic administration could point to the record of New Freedom legislation for agriculture, farmers saw no continued postwar response to their needs, and the administration even failed to make good its announced intention to hear from the farmers at a national agricultural conference. T h e farmers were left to their own devices and could only hope that the 1920 election year might turn up a more satisfactory and lasting program of service. Renewed discussion was heard concerning the political inclinations of rural voters. A well-defined farm vote had not yet become an object of public alarm; nevertheless, farm interests were winning increased attention as farmers themselves became politically sensitive. Both major parties had substantial agricultural support, but within those parties the agricultural interests seemed too often subordinated to the ambitions of powerful industrial and financial groups. Where the rural vote indicated a spirit of independence, it was progressive in its thinking and as eager for general reforms to make

AGRICULTURE ON THE BRINK

3X

democracy more perfect as for class legislation to benefit the farmer directly. Such independence was a characteristic of the highly rural states west of Lake Michigan and the Mississippi River, a section with a block of electoral votes large enough to tip most elections if those votes were delivered as a unit. Among western states local politics were disturbed by agrarian temper, and standing insurrections existed against Old Guardism; these were sources of infectious progressivism. North Dakota, for example, was a hotbed for novel ideas about economic reforms and was also a proving ground for political tactics to be tried in other states by discontented agrarians. The Nonpartisan League practiced machine politics of the notorious sort, but farmer voters were confident that the machine was really their own. From North Dakota the lesson was available to farmers in other states that if they stood together with political leadership they might get nearly anything government could provide. In 1919 the Nonpartisan League was at the peak of its influence. Though hurt by the war, it had complete control of the state government, and it proceeded to build on the blueprint it had drawn for an agrarian commonwealth. The program of the Nonpartisan League aimed to retrieve the farmers' rightful position through state government, which would provide means for farmers to control the marketing of their products. T h e league's "Industrial Program," enacted in February, 1919, included legislation to establish state control of grading and weighing wheat, state-owned elevators and flour mills, state hail insurance, railway rate reductions, steeply graduated income and inheritance taxes, the recall of public officials, and, most important, a Bank of North Dakota for providing easy rural credits.95 Nonpartisan mismanagement of state affairs helped bring on a decline in the league's power, evident in the spring primary of 1920, although the underlying agrarian rebellion remained intact. It would proceed thereafter at a different rate and in somewhat different hands, but it would continue. Outside the wheat region less simple agricultural problems limited the applicability of the Nonpartisan plan, but there was much interest in the North Dakota experiment in solving the farmers' economic problems.58 T o carry the idea throughout the West, a National Nonpartisan League had been organized in 1917 with

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ambitions for the conquest of one state after another. A t its annual meeting in December, 1919, the Nonpartisan National Committee heard reports from twelve state organizations."7 Minnesota politics exhibited the sort of unstable two-party system that invited such operations as those conducted by the Nonpartisan League. Throughout the state spread a network of farmers' cooperative associations, where groups of farmers could hear the gospel of nonpartisan political action to make the state government friendly to the rural interest. In 1918 the Minnesota Nonpartisan League tried to nominate former Congressman Charles A. Lindbergh for governor, and a temporary farmer-labor third-party ticket was pieced together by the league and the state Federation of Labor. In 1920 a better organized Farmer-Labor Party put up Henrik Shipstead for governor. Wisconsin had its own semiagrarian revolt continually in operation under the leadership of Senator Robert M. La Follette. La Follette had held the state firmly in his grasp since the turn of the century, and from Wisconsin there had spread out into other western states the La Follette brand of progressivism, attractive to farmer and labor forces. South Dakota was another state in which agrarianism was at the top in political affairs. It was a natural area for the extension of Nonpartisan League activity, but the league could not defeat the agrarian program of Republican Governor Peter Nor beck."8 Thus between 1918 and 1920 there had grown up in most states of the rural West new political expressions of general agrarian restlessness. The influence of the Nonpartisan League had spread out over this region to vitalize a latent populism that was now prepared to use the direct primary to infiltrate a major party, or to put up independent tickets if the primary method proved unsuccessful. A significant feature of western agrarian insurgency was its readiness to cooperate in politics with the forces of organized labor. Railroads and mines brought organized labor into rural communities to make union men out of farm boys, and nearly every western state had its metropolis with organized labor. T h e vote of the laboring population was a significant factor even in the most rural states, and if that vote could be allied with the agrarian interests, unbeatable combinations could be formed. Since the Knights of Labor had been involved in the Populist Party with unfortunate

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results, organized labor had steered away from partisan politics and association with farmer organizations. However, in 1919 and 1920, radical agrarians and politically conscious labor forces were reaching out for joint participation in national politics. Farmer-labor-progressive political movements with ambitions for absorbing one another and becoming powerfully decisive in national affairs gathered momentum through 1919. Although such developments could still be dismissed as fringe movements, the presidential year brought to the surface, where they could be noticed, all those political groupings that were capable of shifting the majority in critical states. In July, 1920, a national Farmer-Labor Party appeared and entered the presidential race hoping to be a third major party, but actually as another minor party. T h e new party, despite its awesome name, was so clearly a working class movement that farmers could find little about it that was attractive. Farmers therefore pursued their own ends, not those of the radical labor elements, and looked to the major parties for sympathetic attention. However, the possibility of a large farmer-labor political revolt lay uneasily in the background of national politics for another four years. An attempt was made in January and February to bring the large farm groups together on a single program of agricultural demands. In two conferences an imposing number of farm organizations contributed to a platform prepared for presentation to Congress' and to the national conventions. Unimpressive as a chart for the sound development of the agricultural industry, the platform proposed by the farmers called for economy in government, opposition to price fixing, and control of profiteering. Somewhat more specific but scarcely urgent demands were requests for collective bargaining for farmers, a pure-seed law, and increased appropriations for agricultural extension services and work of the Bureau of Crop Estimates.™ Individually, the major farm organizations, in presenting their requests to the parties, exhibited little ability to construct a program for future agricultural progress. The American Farm Bureau, in its program for the party platforms, maintained that the larger difficulties were to be attacked outside government through cooperative action in the economic arena. T h e National Board of Farm Organizations drew up a questionnaire to be submitted to candidates for the presidential nominations and an agri-

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cultural program for the party conventions, but nothing novel or compelling was brought forth.00 A delegation from the national farm organizations went to the Republican convention with demands for farmer recognition. 61 It requested the appointment of government officials and commissions, protection for farmers' cooperatives, federal control of the meat packers and other food prpcessors, laws to check and reduce tenancy, Federal Farm Loan System expansion, provision for cooperative personal and shortterm credits, cost-of-production studies, and tariff protection to equal that of other industries. Between the two parties, agriculture came off best at the hands of the Republicans, who included an agricultural plank written with the assistance of Henry C. Wallace. T h e party committed itself to "adequate farm representation" in the appointment of governmental officials and commissions, the right of farmers to form marketing cooperatives free from legal discrimination, and "the scientific study" of agricultural prices and farm-production costs at home and abroad, "with a view to reducing the frequency of abnormal fluctuations." T h e platform also pledged the encouragement of export trade and an end to "unnecessary price fixing and ill-considered efforts arbitrarily to reduce prices of farm products." Other planks included items of interest to farmers such as equal tariff protection, such credits as farmers might need to finance adequately their long-time production operations, liberal federal appropriation for public roads with emphasis on farm-to-market roads, and approval of the St. Lawrence waterway.02 W h e n they presented their farm demands to the Democratic convention at San Francisco, agricultural representatives met with disappointment. T h e Democratic platform designers were much more impressed with what the New Freedom had done for agriculture than they were with the farmer's current problems. T h e Democrats were not expected to promise tariff protection, but farmers could expect low tariffs to help keep down the prices of goods they purchased.63 In the campaign of 1920 the major parties were more interested in avoiding or confusing the issues than they were in competing for clarity of statement and program. T h e League of Nations issue and "normalcy" versus bureaucracy were the prominent questions. By and large, neither Cox nor Harding indicated that the developing farm crisis had bearing upon the political campaign. Republi-

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can leaders were willing to blame price declines upon meddling by the Democratic administration, but the issue was not exploited. T o farmers, normalcy meant an end to government "price drives" against farm produce and a redirection of Department of Agriculture policy to the practical needs of actual farmers. Republican strategy aimed at agriculture as a weak spot of Governor Cox, and Henry C. Wallace was brought into the council of advisers to help plan and draft Harding's agricultural comments. When Harding spoke to a farm audience at the Minnesota state fair on September 8, 1920, he spelled out a farm program that he was to have difficulty following. T h e party and Harding were committed to a wide program of farm support, at a time when agriculture was entering a crisis period so acute that it would call upon the new administration to redeem its pledges in full measure. O n November 2, 1920, the rural vote was cast for the Republican candidate with greater emphasis than in any other recent election. Prices of farm products had begun to decline in a serious fashion, and the outgoing administration bore the blame. A t the state level, also, the election of 1920 was a landslide for the Republican Party. Republicans made handsome gains, which enlarged their majorities in the Congress, but the very size of these majorities encouraged urban-rural and progressive-conservative cleavages. Exceptions to the general picture of conservative Republican return to power were seen in a number of western localities, where ample agrarian revolt drew strength from discontents that antedated the agricultural crisis. Rural discontent in 1920 expressed itself by voting against the party in power, but did not go appreciably further than support for the major opposition party. T h e two major parties still offered the best means of satisfying farmer and labor legislative desires. Agricultural discontent had expressed itself in the primaries, and although it was not so visible in the general election, obituaries written for it were premature. The Postwar Agricultural

Outlook,

1919-1920

For a year and a half after the Armistice, the agricultural industry, already altered by forces released in the years 1914-1918, continued its wartime tendencies. Through 1919 into 1920 markets were hungry, prices were high, farm incomes were good even

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if new costs narrowed the net, and credit was easily available both to producer and purchaser. When the individual farmer considered his own farming operations, such immediate facts as these overshadowed news of America's large international-creditor status and the poverty of European markets, where America's agricultural surpluses must be sold. As in the recent past, with 1919 prices and income, farmers could renew equipment, buy new power machinery, and improve herds. Farmers were becoming more efficient in their operations—although achievements did not correspond to the available knowledge—and moving ahead to a new living standard with an eager desire to solve their problems. The post-Armistice recession ended by the 1919 planting season. Then and again in 1920 farmers did what they, as producers, thought they were supposed to do and planted great acreages. T h e estimated 1919 acreage of all crops grew to 365,348,000 acres, a slight gain over the previous year and a significant continuation of wartime levels. In this boomtime atmosphere there was little stimulus for the retrenchment that would prepare the farming industry either for diminished outlets or reduced prices. In the wheat acreage planted for the 1920 crop a tendency toward readjustment was noticeable. Total wheat acreage declined 20.9 per cent below 1919 but remained 5.7 per cent above the average for the years 1914-1918." In the summer of 1919 representatives of the Grain Corporation and the Department of Agriculture made a breadgrain survey of Europe, estimating the surplus in exporting countries at slightly more than equal the European demand. On the basis of this information the Secretary of Agriculture indicated the desirability of producing in the United States in 1920 an exportable surplus "somewhat in excess of the pre-war average, but less than was necessary during the war." If there were apprehensions concerning high-level production, the Department of Agriculture assured those concerned that it was "watching the changes of world supply and demand."" T h e wheat acreage devoted to the 1920 crop gave no basis for concern that wheat was dangerously overexpanded. Cotton acreage in 1920 was 35,878,000 acres, larger by 2,312,000 acres than in 1919, but only 548,000 acres above the 1910-1914 average." T h e American Cotton Association, according to its president, J. S. Wannamaker, had planned in the fall of 1919 to put forth a large effort to cut back cotton planting, but government

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37

officials and the World Cotton Conference in October had persuaded the association that cotton would be needed." Only a few warnings pointed to the dependence of agricultural prosperity upon an extremely hazardous European market. Herbert Hoover issued a cautioning statement from Paris September 1, 1919, forecasting the inability of European markets to absorb food despite a large continuing need, and suggested additional United States credits for European purchases.68 Secretary of Agriculture Houston noticed unfavorable exchange rates as an impediment to the continuing free flow of farm produce, and greatly in creased ocean freight rates as a "powerful stimulus" to the increase in European food production. He recommended that farmers "practice safe farming, returning to a balanced agriculture and to the operations best suited to their own individual community conditions.'"® Nevertheless, in his last annual report, dated November 15, 1919, Secretary Houston wrote complacently of the ability of agriculture to meet enlarged future food requirements through increased yields and continued expansion of farm crop acreages. Early evidence of an unstable export market was brought home emphatically only to livestock producers. A declining European market for meat coupled with continued high-level American production brought about a crisis in livestock, which was a foretaste of what was later to come to the rest of agriculture. Hog prices tumbled steeply from the Chicago high point, $23.50 per hundredweight at the end of July, to a low point of $11.50 in November,TO Prices of cattle descended less abruptly but were unmistakably on a downward course. Although foreign and domestic outlets could not keep pace with the production of meats, there was a strong demand for most other farm products. Following wartime shortages, wholesalers, processors, and retailers anticipated high prices; the result was the stockpiling of large quantities of merchandise. In a season of short supply there developed speculation that drove goods out of sight and pushed up prices. T h e national fiscal policy, which continued inflationary tendencies, contributed to the rebound of prices. Financing the great war effort carried a burden of debt and expanded currency into the postwar period as an unavoidable inflationary force. In floating the Victory Loan in April and May, the Treasury was anxious to keep

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interest rates low as in previous issues, and the Federal Reserve Board reflected Treasury policy by taking no action to curb the expansion of credits. Federal Reserve discount rates remained abnormally low until November, 1919, when the board began hesitantly to exercise its ability to diminish inflation by approving successive increases in these rates.11 As a result of inflation, prices of agricultural commodities rose to levels that intoxicated farmers. A Department of Agriculture index of crop prices based on the years 1909-19 "3 showed prices in 1919 to be 121 per cent above prewar. T h e peak month was June, 1920, when the average was 31 per cent above that of 1919. Individual agricultural commodity prices reached memorable levels, which contrasted painfully with low prices of succeeding years. High prices combined with large production levels gave farmers unusually high incomes. Total gross value of farm products, based on prices at the farm, was estimated by the Department of Agriculture to be $24,961,000,000 in 1919, 153 per cent above the 1913 level of $9,850,000,000.™ Despite higher prices for what they bought and higher costs of production, farmers had saved money from wartime income. Evidence of unaccustomed wealth was an inordinately thriftless speculative bubble in purebred livestock. Desirability of livestock improvement and of possession of herds of high quality animals was evident to the nation's progressive farmers and prepared them for the operations of get-rich-quick promoters. Spectacular record sales helped to set the tone, and though record heights were far from typical, many farmers bought breeding stock at vastly enhanced prices—for example, a record sale in May, 1919, of $125,000 for a Holstein-Friesian bull, "Rag Apple the Great." While farmers had money they attracted the attention of investment experts of various degrees of honesty. Liquid assets were exchanged for poor investments by the systematic deception of highpressure salesmanship, and large sums were extracted from agriculture by sheer fraud. Not only did farmers lose money on existing assets, but stocks were bought on an installment basis, thus increasing the farmers' debt. Local banks often failed to exercise a restraining influence upon marginal investments by farmers and were occasionally even involved in promotion operations. Texas land frauds were common at this time together with such typical swin-

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dies as the Alaska Sulphur Company, the Aerocruiser Corporation, and the Alabama Oil Company. Speculative frenzy in land prices was one of the most notable features of the two postwar years in agriculture and a source of great future trouble for farmers, who bought land or mortgaged what they had with expectation of continued high values. Land values had grown gradually until 1919, lagging behind the upward curve of farm-produce prices until the earning power of land became an attraction to investment. Also, in conformity with the doctrine of Ricardo, anticipated future income from land was capitalized as higher land prices. In 1919-1920 optimism fed upon optimism until faith in continued prosperity soared away from all customary formulae for measuring the agricultural outlook. T h e idea gained currency that land possessed a social value entirely aside from its productive value, and former economic restraints upon the price of land were no longer valid. T h e president of the Iowa State Board of Agriculture, speaking in December, 1919, said: "People ask me if I think this land will stay at that price [$200 to $500 per acre] and I say it certainly will. It may not go any higher for some time, but I do not think it will go back."73 Less responsible statements were recorded that the price of the best land would continue rising until it reached $1,000 per acre. Prices of farm land on the average showed great gains, although exceptional increases were the ones that caught attention. Improved farm land in 1919 was 40 per cent above 1912-1914, and then reached a long-lasting peak in 1920 with values at 70 per cent above prewar. A "phenomenal advance in land values" was reported in Iowa, where examples were reported of farm land selling for $400 and more per acre, although less than 5 per cent of Iowa land sales from March, 1919, to March, 1920, were in that bracket." Most land purchases were made with at least a first mortgage, and sometimes even third mortgages, which looked far into the future for liquidation. Outward evidences of rural prosperity coupled with a painfully high cost of living in cities called forth denunciation of the farmer as a profiteer. Sensitive farmers, increasingly aware of their business costs, were on the defensive. In August, 1919, the presidents of five state farm bureaus called upon President Wilson and Secretary

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Houston to present a memorial stating that farmers, far from being profiteers, could not accept lower prices until other prices came down.™ Self-conscious about the same accusation, the National Grange at its November, 1919, session adopted a long resolution insisting that "the cause of high prices is not out on the farm;" and declaring that farmers were inadequately paid for "capital invested, and labor and ability used.'"6 S. J. Lowell, Master of the National Grange, said to a farm group in January, 1920: "I had a man say to me, 'The farmers are rolling in wealth.' I told him, 'For Heavens' sake, come out and roll.' "" Agriculture's great boom period, measured by prices and incomes, was distinctly qualified by increased costs of operation. T h e crops of 1920 cost more to produce than those of any previous year and set a record that would stand until World War II.78 The cultivation of less desirable lands with lower yielding power meant high costs per unit of production. Machinery, fertilizer, fencing, and draintile were at prices approximately twice prewar levels, and prices of articles generally bought by farmers were on the average 219 per cent of 1914.™ Cash crops meant greater demand for labor, which was scarce and was calling for pay more nearly in line with the general wage scale. Farm wage rates reached a high point in 1920 at 142 per cent above 1914, $5 a day being common pay for farm labor.® As the farmer strove for money income through production of cash crops, overhead and other costs mounted. High land values, together with increased public services, meant that real estate taxes were double prewar. New price and wage levels upped the cost of local government, which was at this time undertaking to construct roads and consolidated schools. In levying taxes for local government the traditional source of funds was the general property tax, which bore heavily upon the farmer with his wealth readily in view and easily assessed.81 Farm mortgage debt, growing even more rapidly than the value of farm lands during the boom period, meant interest charges to be entered into the cost account. Between 1910 and 1920 the amount of mortgage debt on owner-operated farms grew from $1,726,172,851 to $4,003,767,192, an increase of 131.9 per cent.82 As farmers maintained their expanded operations into 1920 with mounting costs, their need for production credit was larger than customary; farmers' short-term bank loans grew to an estimated

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41

$3,869,891,415 in 192o.8" In addition to mortgage loans, an extra large volume of credit at interest rates close to 8 per cent put a heavy burden upon the continued stability of the industry. Writing under the imprint of the American Farm Bureau Federation in the spring of 1920, Gray Silver stated that banks "discriminated against" the farmer and calculated that the farmers' interest rate ran higher than that paid by urban borrowers by 3 per cent, an extra cost to the farmers of $60,000,000 annually.81 Increased costs pared the larger farm incomes until farmers were less well off during the peak of the boom than they had been in 1918 and 1919. The purchasing power of farm products kept above the prewar year 1913 only until February, 1920, when it fell to 92 per cent. At a time of highest prices for farm commodities, in May, 1920, purchasing power was but 88 per cent of 1913.85 A multitude of new costs fixed upon production bound the commercial farmer to obligations that could not be readily discharged should price levels fall. T h e individual, diversified family enterprise, with a high degree of self-sufficiency and independence, remained a powerful concept cherished as a way of life by many oldstyle farmers. But the postwar farmer was more nearly a businessman, producing for sale with complex equipment, coming to terms with involved marketing procedures, struggling to balance prices and costs, and aspiring to live in conformity with new urban standards. Farming had become commercialized, but imperfectly. The farmer depended upon prices which fluctuated, without a facility for quick adjustment of his operations. Not generally appreciated were economic barriers and noncommercial habits that stood in the way of social improvement.88 Rural people, during their prosperity, were moving forward in enjoyment of a twentieth-century American standard of living. What seemed to others extravagant buying by farmers was but a striving for near-equality in material goods and comforts, regarded by farmers as a righteous sort of social progress. Great advances were made in securing farm conveniences during the years 1910-1920, and especially during the last two years of this period; still, the census of January 1, 1920, showed only 30.7 per cent of the farms with automobiles, 38.7 per cent with telephones, 10 per cent with water piped into the house, and 7 per cent with gas or electric light."

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Broad social changes in agriculture were revealed by a special agricultural census taken in connection with the regular decennial census of 1920. For the first time a count was made of the farm population, and this showed the scales to have tipped decidedly, nonfarming people outnumbering farmers by more than two to one. T o farmers there was danger that the agricultural minority would be sacrificed to further building of an urban-industrial system. An ominous farm-to-city drift seemed to drain away from agriculture its best young blood, leaving oldsters to continue the business, and the growth of tenancy was cause for concern.® Another side of the census showed expanded urban markets for farmers' produce and substantial gains in the efficiency of production. The complaints of farm spokesmen were not that agriculture had hard times but that other interests were getting part of the farmers' share of prosperity. But it was believed that what problems existed could be conquered. At this time the key to constructive change was thought to lie in organization. There was the new American Farm Bureau, of vast potential strength, and there was the cooperative-marketing movement now developing new ambitions for reform of the distribution system. T h e two were joined when the Farm Bureau made cooperation its basic tool for the improvement of agricultural business. The middleman had been an object of farm criticism before the war, and now it was all too plain that farmers received a decreasing share of what the consumer paid for food and fiber. T h e postwar years therefore were marked by a quick and dramatic upsurge in the formation of cooperative-marketing associations. A movement toward larger, more centralized, and presumably more effective cooperatives on a regional and national basis grew rapidly in 1919 and 1920. If the farmer was to make more than small gains he saw that he must form great cooperatives not only to transfer the fat profits of middlemen to the farmer's account, but also to feed the markets in an orderly fashion and stabilize prices. This vision seemed to be the ultimate in the evolution of the farmers' business organization. Growers in Kansas had attempted a wheat pool in 1919, and by preventing member farmers from selling wheat prematurely, managed to gain for producers handsome additional returns as wheat prices soared during the winter. Plans were made for expan-

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sion of the system into the southern wheat states, and at a meeting at Hutchinson, Kansas, in May, 1920, the National Wheat Growers' Association was begun.8" The program advanced by the new group was to pool the wheat of a large number of members (the wheat to be held by individual farmers under contract to the association), keep it off the market until a fair price could be secured, and reinforce this demand with an autumn acreage reduction if necessary. T h e plan was unsoundly developed and administered, with more attention to drama than to economics, but it illustrated the search in 1920 for means by which farmers could control their economic destiny beyond the scope of the local farmers' elevators. In the South, cooperative cotton associations had fallen short of returning to the planter his just share of cotton's value. In 1919 the cotton cooperative movement was renewed on a large scale by the American Cotton Association, which had some success in persuading farmers to reduce their planting that year. T h e American Cotton Association regarded the increased plantings of 1920 with misgivings and called a large cotton-marketing conference to meet in Montgomery, Alabama, in April, 1920. Several thousand planters, merchants, and bankers were in attendance, determined to participate in a great new movement to reform the wasteful system of cotton marketing, about which there had been much talk and little accomplishment in fifty years or more.90 At this meeting the cooperative movement in the South was at once set off in the new direction toward large-scale centralized associations with ambitions of market control. T h e American Farm Bureau, captivated by the dream of farmercontrolled marketing, promoted a series of national meetings to consider the marketing problems of major commodities and underwrote the work of committees formed to develop plans for great national marketing associations, which would finally fulfill ambitions for economic power. In response to a request of the midwestern state farm bureaus, President J. R. Howard called a large national conference on grain and livestock marketing to meet in Chicago July 23, 1920." Attending the meeting were representatives of cooperative associations and national and state farm groups, more than four hundred delegates in all, including representatives of the Department of Agriculture. Interest concentrated on the pressing grain problem. President Howard spoke of the idea of

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organizing local grain interests in every state so that the "producers will have control of the grain until it reaches the manufacturer." This Chicago conference, like the Montgomery meeting in April, was revolutionary in its effect upon the cooperative-marketing movement for it resulted in the appointment of a Committee of Seventeen to draw up a blueprint for establishing a national cooperative grain-marketing agency." A large question hanging over agriculture in the late spring was the price wheat would bring when the government's guarantee ended. Soaring prices early in the year were taken as evidence that Gram Corporation policy had been to inhibit price increases, and continuing high prices indicated that when free of control grain would be able to hold its own. From January until the end of May, when the Grain Corporation ceased its purchases, the price of wheat ranged above $3, reaching a height previously unknown in American markets. Looking forward to termination of Grain Corporation activity, trade journals reported price forecasts ranging from $ 1.50 to $4 per bushel. Recognizing instability in the grain trade and wishing to pave the way for resumption of private trading, Wheat Director Julius Barnes called a Grain Trade Conference to meet in Chicago May 7, 1920. Barnes pointed with pride to the expansion of wheat production under the Food Administration and the supplies that had been made available to hungry Europeans. His confidence in the wheat price outlook sprang from the reduced wheat acreage in 1920 and weather damage to winter and spring wheat, both factors pointing to a shortage in supplies.8" T h e conference decided that grainfutures trading might begin again July 15, and it believed that there was small danger of wide fluctuation or manipulation.81 As wheat prices passed their peak, private trading was resumed June 1, 1920, and one of the last great wartime controls was disbanded on the eve of harvest. Election-year preoccupations and diversions further obscured the troubles piling up for agriculture. In the late spring of 1920 urban concern with the farm problem was fear of shortages, which would help hold high the cost of living. T h e weather seemed unfavorable, and farm labor was short. On May 23, 1920, the New York World editorial section carried an article by a prominent financial writer, which forecast wheat at $5 per bushel and other prices in keeping.05

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45

At the same time Herbert Hoover in a public letter stressed that "our agricultural production is decreasing, and unless we can stem this tide of decrease we shall soon be dependent on overseas supplies.'"11 By June, crop prospects were better and the Federal Reserve System viewed the future with much satisfaction. Prices were holding up well, and private grain trading had been resumed without a flurry. Agricultural journals that had a reputation for cautious judgment reflected much of the complacency of urban observers. Wallaces' Farmer reported wobbly prices in April and declining exports of pork, but was able to state: "Personally, we are inclined to look on fluctuating foreign exchange values as a smoke screen under cover of which foreign nations . . . are enabled to manipulate American prices to their own profit." A month later the same journal reported "vague rumors of a panic in the near future," but "personally we do not believe that it is possible for a panic of the old-fashioned type to develop at the present time" because "not only do we have the federal reserve bank which is designed to prevent such an occurrence, but there is also a continued demand for many kinds of goods."" Prices were good, with indications that they would stay that way, and farmers looked forward eagerly to the solution of political and economic problems. As men of business, farmers were learning the ways of commerce and entertained dreams of controlling the markets. Until the midyear of 1920 agriculture moved forward toward a grand new age of accomplishment.

•

^

Chapter II

Agriculture's Price Panic

During the second half of 1920, prices of agricultural produce slid away from their highest peak, tumbled throughout the autumn, and continued to drop in 1921. From July to December the average price of ten leading crops fell 57 per cent, and by May, 1921, prices were but one-third of what they had been the preceding June. 1 The autumn panic of 1920 coincided with the harvest period, hitting farmers who had brought their crops through a difficult year. Large crops came onto the market at a time of falling prices, when buyers retreated and sellers cut their asking prices to find vanishing purchasers. Graphs of agricultural commodity prices show lines crowding one another for space on the downward slope. Here was a complete upset of fond expectations for continued high returns that had prevailed among farmers until the very edge of collapse, and the initial price crisis was the most crushing that American agriculture had yet experienced. The Price Break, July-December, 1920 In the first stages of the price toboggan, a variety of explanations was advanced for causes of the catastrophe, and confusion existed among farmers in their search for means of relief. A few farm elements found cushions to break their declines, but others plummeted to a rock bottom. Causes for the farmers' price break were as varied as the commodities produced. Some crops suffered from real overproduction, others were left on the shelf by tempo46

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47

rary market dislocations, and some were suddenly stranded by freight-rate increases. Export demands had remained effective until 1920, when Europe's ability to buy American goods was exhausted. Public reconstruction loans were ended, the War Finance Corporation was suspended, and private loans abroad dried up as domestic demands for credit increased. Europe's need for food and raw materials continued, but though great quantities of goods continued to flow abroad despite Europe's poverty, prices were much lower than before the crisis. T h e domestic wholesale market was saturated with goods of many kinds before the 1920 crop began to add to accumulated inventories. Hoards that had been held for speculative purposes began to seek buyers. Transportation obstacles disappeared after the period of confusion attending return of the railroads to private ownership, and new supplies began to move toward storage facilities that were already crowded. In 1920 the largest crops on record were produced in corn, tobacco, rice, sugar beets, sweet potatoes, and grain sorghum. Other crops far above average were oats, potatoes, apples, and hay. No buyers' strike was necessary to reveal the expanded stocks of goods. Just as the downward price turn began, new high freight rates granted by the Interstate Commerce Commission became effective. T h e coincidence of the two events revived a chronic freight-rate grievance. Many farmers who had been clamoring for cars to move away their carry-over from the 1919 crop were unable to ship their goods until after the new rates became effective. Where farmers were situated in newly created submarginal areas it was clear that increased rates were a direct cause of lower prices. Farmers' credit resources had been dangerously extended to meet high production costs, and credit generally was increasingly difficult to obtain, even at high rates, as the marketing season approached. Price declines forced local banks loaded with agricultural paper to seek shelter by calling in their loans, an action that in turn forced farmers to dump their products on a demoralized market, adding greatly to the price panic. A crisis in the livestock industry had occurred in the autumn of 1919, with partial recovery in 1920. Prices hovered around profitable levels until September, 1920, when new price declines contributed to a panic, which forced prices down 32.5 per cent by the

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end of the year. In November, all records for receipts at the Chicago stockyards were broken. As livestock prices fell it became unprofitable for cattle feeders in the Corn Belt to continue operations, and the market for feeder cattle from western ranges disappeared so that immature stock and even breeding stuff found outlet only in the packing houses at distress prices. By the end of 1920 fat cattle were not bringing enough to cover the money paid for feeders before finishing for the market. Early in 1921 prices again slumped rapidly, then declined slowly until a low point was reached in December, 1921. Good beef steers on the Chicago market fell from a postwar high monthly average of $16.45 P e r hundredweight to $7.31 in December, 1921." Wool producers suffered as keenly as any other agricultural group in consequence of particularly difficult problems facing them in 1920. Prices of raw wool had risen about 300 per cent during the war emergency, when it was stockpiled in great quantities by the government. A drouth followed by the severe winter of 1919-20 resulted in heavy losses of sheep and lambs, a short wool crop, and debt. Yet government stocks were released slowly, and by the end of 1920 there was nearly a two-year supply of wool in manufacturers' hands, preventing domestic producers from gaining a price advantage from their short crop. For a time, as prices rushed toward lower levels, the price of wool was less than that of cotton. T h e sheep producer saw the market for his lambs decline in much the same fashion. From a 1920 high of $19.95, the price dropped to $8.66 in October, 1921.° Fat ewes quoted as low as $3 on the Chicago market were found to be cheaper than tankage quoted at $80 to $90 a ton, with the inevitable half-serious recommendation that hog producers use sheep for feed. T h e great blow received by sheep producers resulted in a distinct decline in the number of sheep, an adjustment that put the surviving producers in a position for rapid recovery when the shortage came to be noticed in the market. Corn Belt farms felt the crisis in sheep and cattle prices since those animals as well as swine were important products of their diversified agriculture. This section suffered severely from the price crisis, although its troubles were delayed and not so extreme as those of specialized single-crop areas. T h e 1920 corn crop was unprecedented, running half a billion bushels larger than the prewar average, but as most corn was fed to animals, which had declined

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in number, the 1920 corn crop had a restricted value. After a postwar peak in May, 1920, corn prices declined until, at the end of the year, they were nearly a third of the high point and still on the way down, from $1.97 per bushel to 46 cents in October, 1921. 4 It was generally agreed that corn-production costs were 50 per cent above selling prices, and in some localities corn was reported to have gone down to 35 cents a bushel. In 1920 and 1921 abundant cheap corn and prospective hog shortages caused hog producers again to expand their operations, and although it was possible to gain something by feeding corn of little value to hogs that had some value, the price of hogs remained unexpectedly low. Dairying regions were thought to be insulated from the worst effects of the price crisis by virtue of their supposed freedom from export markets. Nevertheless, deflation and panic penetrated areas of the dairy industry. Milk condenseries were a new supplemental outlet, which had geared many dairy producers to that market rather than to the urban demand. When exports were cut in half in 1920 a promising supplement to the market milk business received a long-lasting setback. In September New York dairy farmers were advised by overstocked condenseries that they would not buy milk at any price after the first of October.5 The price of butter held steady despite the price panic, and dairying generally remained a rare bright spot in the picture of deepening agricultural depression. The tobacco industry of the border states was hit with a particularly severe price crisis. The year 1919 had been favorable for tobacco planters, with prices several times prewar levels. In 1920 tobacco acreage was increased extraordinarily, and although volume of production was above any previous year, quality was poor. The price broke before the crop found its way to market. The average price for bright southern tobacco fell from 44 cents in 1919 to 21. i cents in 1920, and Burley fell from an average of 33 to 13.4 cents.' At the opening of the Burley auctions in the Ohio Valley in January, 1921, initial bids were 10 to 15 cents per pound, dropping to 3 and 5. Auctions at Lexington, Kentucky, ended in a riot, with knives drawn against buyers; markets were forced to close, and violent disturbances were reported elsewhere in the tobacco country. Cotton, the mainstay of the deep South, suffered a price collapse that drew the whole region back into a deadening poverty reminis-

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cent of Reconstruction. Although prices were high for the 1919 crop, there was a carry-over to the 1920 marketing season of about 5,000,000 bales of low-grade cotton, which had not been used during the war. High prices had engendered a boom spirit in the South that resisted warnings against continued large-scale production and resulted in a 1920 cotton planting 2,300,000 acres more than 1919. The yield was good and a bumper crop was produced to go onto the market at a time when textile mills were finding their outlets overstocked. Prices of finished goods had simply outrun capacity to purchase, and speculative buying came suddenly to an end. Foreign consumers of raw cotton exhausted their ability to buy, and the Japanese market for American cotton was especially contracted when the silk-goods price bubble burst. Cotton prices broke before the 1920 crop was picked and sent to the gins. On the New Orleans market the average monthly price per pound had touched a high of 41.4 cents in April, 1920, and hovered around 40 cents until August, the eve of the harvest, when large drops began to occur. By December the price had wavered downward to 14.6 cents and continued down until a low of 10.3 cents was reached in June, 1921, below the prewar average. When panic hit, planters had used up their credit resources and banks had overextended themselves on cotton loans. Banks contributed to the stringency by calling for payments, while planters cried for extension and new credits to carry their cotton for a price recovery. In some instances cotton buyers, aware of the planters' credit pinch, stirred up competitive selling which pushed prices further downward. Angry cotton men descended upon Washington with demands for special credit assistance, but all they received was unacceptable advice. As cotton growers recognized the severity of their losses, there grew a disposition to hold cotton whether banks approved or not. In some districts planters determined to stop further ginning, and "night riders" attempted to stop cotton picking and the movement of cotton to the gins. Some who refused to cooperate were reportedly murdered, 25,000 bales were destroyed by terrorists, and gins were burned. Hard-pressed farmers appealed to southern governors, asking (1) a moratorium on cotton loans to prevent foreclosures and (2) the suspension of cotton ginning for thirty days to raise prices. Governor Parker of Louisiana asked the gins to

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cease operations until a "living price" was regained, and he appealed to other governors to do likewise.' In September the Texas Department of Agriculture advised cotton farmers to hold out for a price of 48 cents, and in December published a bulletin that continued this advice, adding that there was no surplus, that markets were weak, and that farmers should control the supply.8 Although the volume of sales was distinctly lowered from October to January, presumably by the holding agitation, the movement had little influence upon prices. A wheat crisis struck the plains states and the Northwest with particular severity and reverberated throughout all the other agricultural regions, where wheat figured importantly in rotation systems. The specialized spring-wheat regions saw the heaviest accumulation of debt before the crash, partly owing to a succession of local crop failures and partly to speculative activity and the high production costs in 1920. This region was also among the first to feel the blow of deflation and to call loudly for relief. Although exports of grain from the United States were unusually large during the fiscal year 1919/20, a great carry-over had not left the producers' hands on July 1, 1920. Farmers held some grain speculatively, and more was not marketed because of freight-car shortages. In either case farmers had to borrow money that would otherwise have come from sales. Before the 1919 stocks of grain were moved away from the country the new crop began to pile up, and prices dwindled. Panic did not enter into the wheat situation until large declines in October and November. Earlier in the autumn sellers of wheat, if they were able to deliver, could command a fair price, but they regarded the first decline as temporary and were encouraged to wait for better prices. A spontaneous wheat-holding program developed as the season wore on and prices continued to drop. Having passed up as too low prices above $3, the owner of grain found it difficult to sell at $2. When the holding movement failed to bring relief, wheat farmers were driven to seek other means for solving their price problem. More than the disappearance of farm profits was involved as prices of products fell below costs of production. As a whole, the gross value of farm production in the twelve months following June, 1920, resulted in an estimated net loss of $6,225,000,000.° The

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collapse was overwhelming. Before the end of 1920 stories were told of farm renters so stricken that they turned everything over to the landlord and walked off. The price panic in agriculture for a short time stood apart from other economic affairs in the nation. In business also a depression developed, as confidence disappeared and stores rushed to dispose of inventories while canceling orders for more goods. Until the end of 1920, however, when an estimated four million workers were unemployed, it was possible for industrial leaders to view deflation merely as a slight interruption of postwar prosperity. Judge Gary of U.S. Steel maintained that there was no real depression, that only fair and stable prices were needed, and an official of the U.S. Chamber of Commerce took a light view of agricultural difficulties: "Experience shows . . . that depressions in agricultural sections . . . are neither so lasting nor so severe as those in industrial centres.... On the whole, the farming community can furnish its own subsistence and tide over bad times.'"0 Credit Shortage and the Federal Reserve

"Conspiracy"

Before 1920 the credit requirements of an increasingly commercialized agricultural industry outgrew available lending resources. Increased land values and permanent improvements required long-term mortgage credits, whereas new methods of farming with higher production costs and a desire to market products more effectively made shorter-term credits a necessity to the farmer. Since available short-term loans did not fit the peculiar requirements for crop credit intermediate between the short-term bank loan and the long-term mortgage loan, farmers paid premium interest rates and were made more vulnerable to credit stringencies. If the farmer was to be a businessman, he should have access to credits that would allow him to market his goods advantageously. In addition to the Federal Farm Loan System, created to help serve the large area of long-term mortgage loans, the Federal Reserve System was designed in part to help serve the short-term credit requirements of agriculture by providing facilities for agricultural paper; but detailed and variable conditions, vexatious to the farmers, were imposed. The Federal Reserve System was still new in 1920; it had as yet experienced no great price panic, and its ability

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to fill emergency credit demands of farmers was vastly overestimated. Early in 1920, agriculture was vulnerable not because it had had too little access to a credit system arranged to serve other industries, but because it had dipped heavily into speculative credit. T h e volume of credit in agricultural regions was extended beyond that of industrial districts, and credit sources were running dry." When prices began to fall, the panicky demand of creditors for liquidation collided with the insistence of farmers on credits to hold their goods until prices came back. High interest rates, up to 10 per cent per annum, on short-term loans at a time of harvest and falling prices meant catastrophe for many farmers. T h e Governors' Conference, meeting in December, took note of distress in the countryside and proclaimed "it is no time for a creditor to seize his debtor by the throat and savagely say: 'Pay me what thou owest.' "** Agricultural interests saw something malevolent in the disappearance of credit and markets when there was great new credit machinery. But the Federal Reserve Board, seconded by Secretary of the Treasury Houston, held old-fashioned views of sound banking practice. The board had been dilatory in exercising its influence to combat inflation, and a general boomtime spirit had been thereby encouraged. T h e banking system, by taking on a mass of poor-quality obligations, impaired its solvency and limited its ability to serve sound enterprises when the crisis created a need for emergency credits. Beginning in December, 1919, the Federal Reserve Board slowly increased rediscount rates and put pressure on member banks to liquidate their borrowings—without, however, notably influencing the speculative boom. Some agricultural indignation was stirred when export loans by the War Finance Corporation were brought to an end May 10, 1920. Houston explained that "business is prosperous.... T h e export business not only has not declined, but has actually increased."" Suspension of further advances by the War Finance Corporation was undertaken as a deflationary move and also to get government out of banking as a step in demobilizing war agencies." Despite the board's actions, all categories of loans increased, even at higher interest rates, and the greatest volume of borrowing was reached after the crisis had begun. The apparent tardiness of the

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board's anti-inflation action prompted a Senate demand to know why the board did not deflate and what was being done to make credits available to move the 1920 crop. This in turn reflected a public demand that more effective steps be taken to reduce the distressfully high cost of living and to dispel a fear among farmers that a credit shortage in the fall would make it difficult to market crops." T h e Federal Reserve Board met with representatives of the Reserve Banks, May 18, 1920, to consider the Senate resolution and to plan for the future. This meeting, reaffirming intentions to exercise control over credits and put the brakes on further inflation, was not open to the public, and the secrecy attending it aroused suspicions of a plot to deflate agriculture. In September, 1920, at a meeting of the Federal Advisory Council to the Federal Reserve Board it was stated that credit control had changed the "psychological attitude" of the whole country from "wild extravagance" to conservatism.18 Agriculture failed to appreciate this point of view, with prices tumbling, and a storm of rural criticism was centered upon the Federal Reserve Board. T h e board was not willing or able to prevent the price collapse, although the farmers were sure it should and could. T h e Federal Reserve System was more nearly an observer than the forceful factor in price matters it was supposed to be. For October the Federal Reserve Bulletin noted that some irregularities in business were occurring as part of the period of transition, and that large crops were depressing prices. Causes for the price crisis were the "inevitable and unavoidable consequences of the economic derangements occasioned by the World War," consequences which the Federal Reserve System could not prevent." Farmers had heard so much about the need for their production to combat the high cost of living at home and ease starvation abroad that they could not believe that an oversupply was the cause of price declines. It was easy to jump to the conclusion that the crisis was a domestic American affair and a temporary condition springing from superficial causes. T h e farm trouble, then, could be remedied by simple market and credit manipulations. T h e easiest way out would be to hold crops until the market shortly recovered, but emergency credits were needed from the Federal Reserve, a system created for just this sort of thing. Thus the Federal Reserve and the Treasury were battered by a whirlwind of outrage as they

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disregarded calls of distress. A series of wrathful rural delegations with demands for emergency credit relief marched on Washington during the autumn of 1920. The cotton crisis had caused the American Cotton Association to undertake a program of production restriction and crop holding until prices returned to 40 cents a pound. The Association called upon the Federal Reserve Board for credit aid and sent along a delegation to discuss cotton financing. Neither the cotton men nor Governor Harding of the Federal Reserve Board chose to understand one another. Governor Harding later recalled that "it would be absolutely futile, dven if we had the legal power to do it, to attempt to throw the resources of the Federal Reserve System back of the cotton situation and to attempt to hold up prices."" The wheat crisis brought western farmers together with the cotton planters in the middle of October for a second try at credit action from Washington. Convinced that the government's fiscal policies had been a chief factor in the price slump, belligerent farm representatives urgently requested that government credit be extended to hold crops off the market and that the War Finance Corporation be reconstructed to extend loans for foreign purchase of farm surpluses. At a session on October 13, a "General Committee" reported that "unless some immediate remedy be found . . . general bankruptcy and ruin are inevitable.... The condition of agriculture is now desperate. The condition of mind of the farm population is ominous." On the same day the conference en masse held stormy sessions with Governor Harding of the Federal Reserve Board and Treasury Secretary Houston. Governor Harding and Secretary Houston maintained that there had been neither contraction of credit nor discrimination against agricultural products, and that the volume of agricultural credits was the largest yet. They passed off as unsound the demands that provision be made for additional credits, lower interest rates, renewal of the War Finance Corporation, and the creation of a special revolving fund for emergency credit. J . A. Wannamaker retorted: "God pity a nation that won't lend money to its people to aid agriculture."" Another agricultural conference, held in Washington late in October upon the invitation of the National Board of Farm Organizations, offered the recommendation that all farmers join great

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marketing organizations that would hold farm products and market them gradually throughout the twelve months following harvest. T h e Federal Reserve Board and the Federal Farm Loan Board were called upon to provide farmers with production credits and marketing loans based on warehouse receipts. Congress was asked to investigate the money supply and high interest rates. The farmers themselves were to consider the formation of a national agricultural bank, financed by farmers' cooperatives and directed by representatives of farm organizations." Meanwhile dismayed farmers refrained from selling as prices fell lower and lower. T h e time had passed for some when obligations could be met from sales, and they held on obstinately, blindly hoping that prices might somehow return to cost-of-production levels. The narrowed flow of goods from farm to market had no visible influence upon prices, but it did prevent the settling of farmers' accounts. The Chicago Federal Reserve Bank appealed to farmers to start making payments on their loans, confirming the impression that the Federal Reserve System was directing pressure to liquidate the farmers. Local banks sometimes used alleged Federal Reserve instructions as an excuse for not accommodating the loan requests of farmers—an evasion of responsibility that fed the indignation of rural interests against the board. The refusal of the Federal Reserve Board to finance crop holding, together with its apparent insistence upon deflation, resulted in the farmers' charge that the board had conspired to deflate agriculture. The allegation was embroidered with accusations that the board had discriminated against agricultural regions by failing to provide credits at a critical moment, although favors had been extended to speculative interests on Wall Street. Since prices of nonagricultural commodities did not fall so quickly or so far as prices of farm products, rural interests were further convinced that they had been singled out for deflation. The "Great Conspiracy" and "Crime of 1920" became an emotional agrarian issue which was for many farm leaders the prime explanation of the agricultural catastrophe. Antagonism to the Federal Reserve Board was almost universal among the nation's farmers, who read and heard a great variety of attacks on the credit system. John Skelton Williams, seeming to speak with authority as former Comptroller of the Currency and stimulated by antipathy to members of the board, indulged in unreasonable attacks upon Federal Reserve policy through pub-

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lished articles and speeches. Charles Barrett saw the deflation as clearly the responsibility of Governor Harding and Secretary Houston, "the Deflation Twins," who "were working as the pliant, if not eager tools of mysterious, invisible, but immensely powerful interests, that were determined to enshrine the dollar at the expense of the man."21 President Howard of the American Farm Bureau subscribed to the conspiracy accusation and said the deflation "was a deliberate intent to strike agriculture first."23 In December, 1920, Governor Harding appeared on the program of the A.F.B.F. convention with a speech in defense of Federal Reserve policy. He said that the board, far from "trying to put on a deflation policy," had been trying to correct abuse and to protect credit, while it also extended the amount of credit to rural sections. Farmers did not believe him.28 In its annual report for 1920 the board regarded deflation as "inevitable and unavoidable, and in view of world-wide conditions [it] could not have been long deferred in this country by any artificial means or temporary expedients. . . T h e board had experimented with policies of general credit contraction in the face of speculative inflation. It tried to fulfill its obligations to the idea of fiscal management, it clumsily handled untried tools, and met such denunciation for its efforts that it would require considerable bravery to attempt control in the future. The Joint Commission of Agricultural Inquiry in its 1922 report soberly judged Federal Reserve and Treasury policy to be chiefly responsible for the farm crisis. Yet the commission concluded that "had discount rates been raised by the Federal Reserve Banks promptly and progressively beginning with the spring of 1919, much of the inflation, expansion, speculation, and extravagance which characterized the following 12 months or more might have been greatly retarded, if not wholly prevented."25 T h e view that policies of credit inhibition came late and could have limited the extent of the speculative boom was confirmed by scholarly investigations of the subject. However, it strained calm analysis to believe that the Treasury and Federal Reserve bore much responsibility for causing the crisis or allowing it to reach the depths to which it descended. No allowable extension of federal credit to farmers could have saved them in 1920. Nonetheless, for decades the crime of calculated deflation was to be cited as justification for unusual

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action by government for relief of agriculture, and the "conspiracy" theory became an article of faith among farmers. So long as organized farmers centered attention upon a credit plot as the source of their troubles and so long as they sought relief primarily through emergency credit expansion, they postponed searching for the causes of the agricultural crisis and the means by which their position could be improved. The Railroad Rate Issue

Railroad freight-rate increases were ranked alongside the credit conspiracy as responsible for the price crisis of 1920. New rates, effective August 26, 1920, were advanced 25 to 40 per cent and were unprecedented in American railroad rate history. These rate changes coincided with the harvest season, putting an additional charge on high-cost crops produced in abnormal quantities for a narrowing market. Freights went up and prices went down; this was enough evidence to farmers that the one was the cause of the other. T h e conclusion was not merged with the view that the agricultural crisis was a product of the Federal Reserve Board, but it was possible for demagogues to link the railroads with Wall Street and thus construct a unified theory of financial exploitation of agriculture. Farmers, fumbling with half-truths and less, had no leaders who could assemble the whole picture and direct reforming energies into a program. Part of the story of rural indignation with the transportation problem was the farmers' claim that they paid a double charge: the freight bill was deducted from the price their produce brought at its destination, and the goods the farmers bought were priced f.o.b. the factory, with transportation charges added. Commercialized farmers had become large consumers of goods produced by others— machinery, fertilizer, building materials, and many articles that entered into costs of production. As a practical proposition to farmers depending upon railroads, freights both going and coming put them at a disadvantage. Benjamin H. Hibbard, speaking before a group of farm economists, declared it was "manifest" that the farmer paid the freight on goods shipped to him as a consumer "and likewise that he suffers a loss corresponding to the freight charge in the case of farm products shipped by him to distant

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buyers."26 T o their transportation liability, farmers could add the unfavorable position of exchanging goods of low utility for goods of high utility, and selling on a competitive market while buying on a market in which prices could be stabilized. Intersectional relationships such as that between eastern dairying and western feed growing were disrupted by new freight rates, and sectional specialization was checked as increased transportation charges encouraged production of diverse crops for local consumption. T h e governor of a northwestern state announced his opinion that the farmers of his region would be obliged to produce goods of a more concentrated value than wheat or flax." Products of low value and heavy bulk that required a long haul were those most widely grown and most affected by radical freight changes. In western irrigated areas, alfalfa hay could be shipped to eastern markets before the rate advance but went begging for buyers afterward. Widely quoted was the story of a Kansas farmer who shipped a carload of alfalfa to the Kansas City market and, when asked what he got for it, said: "I got to grow it." Far-western specialty crops of higher value put a new premium upon grading and the production of higher quality goods, which could better absorb the new costs. Eastern farm regions were stimulated as increased freight rates raised the old bulwark again, and competitive advantages of western soil, topography, and specialization were diminished. Multitudes of subtle influences springing from freight-rate readjustment were at work upon farms producing commerical crops. It was impossible to estimate with any accuracy the cost to agriculture of the freight-rate increases and the secondary charges they caused. T h e A.F.B.F. placed the annual increased freight cost at $1,600,000,000 and pointed also to other losses—fruits and vegetables rotting on the ground because their selling price would not cover costs of picking and shipping, livestock dying on the range because owners could not afford to pay the freight to feeding centers, and corn used for fuel, principally because of "the unjustly excessive level of railroad rates . . . forced upon us."28 T h e Joint Commission of Agricultural Inquiry found "numerous instances" in which freight charges absorbed total returns in the sale of certain products. Secretary of Agriculture Wallace was one of the first to draw the effective illustration that "the simple process of marking up the

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transportation cost a few cents per hundred pounds has the same effect on a surplus-producing state as picking it up and setting it down 100 to 300 miles farther from market.'"® The farmers' best hope for relief lay with the Interstate Commerce Commission, slow as it was, and thus strong representations were made for reconsideration of the August, 1920, rate decision. Early in 1921 the ICC started a protracted series of hearings. In testimony before the ICC, representatives of many agricultural interests were eloquent concerning their piteous state. They persuasively argued that agriculture was a basic industry with a damaged purchasing power, which must be restored in order to bring prosperity back to business and industry. Here was an elaboration of "agricultural fundamentalism," which was to be a feature of farm-relief debate for years ahead. As a result of the new hearings, the Interstate Commerce Commission proposed reductions for 1921 of one-half of the 35 per cent advance of 1920 on grain and livestock in the western regions.™ Although the rate reduction was welcome news, it was such a small gain that farmers pushed ahead with requests for more substantial concessions. T h e Joint Commission of Agricultural Inquiry found for the farmers that "the transportation rates on many commodities, more especially the products of agriculture, bear a disproportionate relation to the prices of such commodities." The Joint Commission then recommended emphatically that "there should be immediate reductions in transportation rates applied to farm products and other basic commodities" and that "so far as possible, freight rates should be adjusted to permit a free movement of all the surplus produced on the farms to the markets where it can be absorbed."" In response to demands for comprehensive freight-rate revisions, the ICC conducted additional hearings and in May, 1922, ordered a 10 per cent decrease on all freight traffic that had not already been so reduced. The findings of the commission might have been written by one of the agricultural witnesses: "The rapid and marked decline in prices without similar reduction in production costs created a serious situation and resulted in a heavy falling off in the purchase of manufactured articles of all kinds in rural sections. This impairment of purchasing power, combined with the falling off in foreign demand, contributed largely to the general business stagnation of 1921.""

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T h e farm crisis collided with a railroad problem to pose a dilemma that the ICC could not solve with minor rate adjustments. In Congress, Senator Capper unsuccessfully proposed a bill to repeal the Esch-Cummins "guarantee" clause, and the Farm Bloc studied the problem without result. By 1922 the arguments of agriculture as accepted by the ICC pointed legislation in a new direction. Since agricultural products were basic necessities, should not rates on basic commodities be reduced even below the profit level and rates on less essential goods advanced to make up the losses?" Secretary of Agriculture Wallace was one of the most effective leaders in developing the idea of aid to agriculture as pump priming, distributing raw materials and foods for industries and cities, and also distributing buying power for the purchase of manufactured go9ds. In an early press statement the secretary put the situation plainly: "Every good citizen . .. should do what he can to help the farmer through this period of depression, not for the sake of helping the farmer alone, but for the sake of helping himself."" As the agricultural crisis persisted through 1923, farm groups placed great emphasis upon the necessity for preferential rates, a view accepted by President Harding and later by President Coolidge. Designed to temper the wind to the shorn lamb, the HochSmith Resolution in 1925 implemented the theory that privileged rates for depressed basic industries were necessary to the economic health of the nation. Congress accepted this manipulation "because the products of agriculture are the prime essentials in the economic structure of organized society. These products are produced under circumstances that do not permit the producer to pass the charges incident to their marketing to the consumer. T h e agriculturist pays the freight upon what he buys and sells. It seems, therefore, but just that provision should be made to make his burden as light as possible, especially upon the things he produces.'"5 Historic agrarian agitation against the railroads, although renewed by the farm depression, dwindled away before the end of agriculture's postwar crisis. Exploitative roads were now tightly controlled. Furthermore, the freight-rate burden of the farmers, upon examination, proved not to be the single cause of the agricultural crisis nor even the major source of rural distress; trans-

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portation costs in relation to agricultural prices constituted but one of the several great interrelated disadvantages confronting producers of farm commodities. The "Price Drive" Theory and Crop-Holding Response Spectacular losses in wheat set off mass meetings of growers, the holding of conferences, and the appointment of committees to seek plans for halting the price toboggan. Farm leaders hastily concluded that the price debacle in wheat was the result of simple forces: a price drive conducted by speculators and the dumping of Canadian wheat onto the United States market. For wheat producers these were sufficient explanations for a time, and the idea that prices were low because of speculative manipulation was readily accepted by producers of other depressed commodities. The crisis of 1920 kindled to new intensity the farmers' long-time indignation against the grain exchanges. Farmers saw futures trading in sharp relief: the "big bears" contracted to deliver goods at a future date and then, hoping to get those goods at a lower price, they worked to depress prices so as to make larger profits. A variation on this theme was the reasoning expressed by Senator Capper, who condemned as an "infamous piracy" the conspiracy to rob the farmer and then, "once the crop is out of his hands, to run the price up."" Respectable organs of rural opinion reiterated the idea of speculative machinations and roused false hope of relief from measures that would remedy only superficial evils. In October the A.F.B.F. maintained that price losses were due to "bear propaganda," and reassured farmers that "the world is short of wheat; the United States is oversold; and prices must certainly go higher."" The National Grange in November adopted a resolution that condemned speculation as the cause of the grain-price drop and called for the enactment of "such laws as will prohibit the gambling in all food products.""8 The theory of speculative manipulation was given apparent validity with the charge that two trading firms, Armour and Livermore, had entered the trading "with practically unlimited quantities of grain which they threw on the market and crushed the market in one day 43 cents." A Senate committee heard a refutation of this and other similar stories by representatives of the Chicago Board of Trade, but a House committee learned from Julius Barnes that speculators in grain sometimes manipulated prices to

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make profits for themselves. T h e Senate committee also heard a man from the Department of Agriculture support the view that the wheat panic was substantially furthered by speculative short selling.89 Strengthening the rural conviction that the grain exchanges were irresponsible and unsatisfactory agencies for setting the wheat price was the incident of a clerk's error in entering a sale of 1,000,000 bushels instead of 1,000, which broke the wheat price 6 cents. In August protests from farmers concerning Canadian wheat on the United States market flooded into the Department of Agriculture, together with requests for information relating to world supplies and prospective markets. Insistent demands called for President Wilson to invoke the antidumping clause of the Revenue Act of 1916 and apply an embargo against Canadian wheat. A typical protest put the situation this way: "Admission Canada grain helps efforts big grain gamblers to lower price of grain. We ask instant embargo on Canadian grain and immediate prosecution gamblers in grain. Health and welfare of families of farmers and workers seriously menaced. Situation intolerable. North Dakota women and children demand action."" Governor Henry Allen of Kansas demanded quick action from the government to halt the "gigantic steal" being put over by the speculators." In reply to appeals, President Wilson directed the Federal Trade Commission to undertake a special investigation of speculation and imports as causes of the wheat crisis. T h e Federal Trade Commission quickly sought information from farmers, farm organizations, grain traders, flour millers, and others; but it failed to get the details it needed from trading firms and the Chicago Board of Trade to retrace the course of daily business on the exchange. In its report, submitted December 13, 1920, the commission found that futures trading had not resulted in manipulation of wheat prices and that big operators had not forced the price down. It listed seven factors that would better explain the cause of low wheat prices: (1) a large world supply, (2) slack demand from combined foreign purchasers, (3) importation from Canada, (4) a record-breaking corn crop, (5) a declining domestic demand for flour, (6) the general price decline, and (7) a credit shortage that resulted in slow buying by millers and other purchasers. The commission also concluded that a large volume of futures trading was mere

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gambling involving great economic waste, and that legal limitations "to reduce the possibility of manipulative trading" were in order.42 Farmers continued to consider means by which markets could be reformed to their advantage. An investigation of the food industry initiated in 1917 resulted in the publication in September, 1920, of three volumes of the Federal Trade Commission's Report on the Grain Trade." T h e study indicated that abuses formerly characteristic of the grain markets had been largely outgrown, but the remedial legislation was still needed. Agitators could find in the report citations to bolster extravagant charges of business malpractice. Complaints were leveled against almost the whole range of the grain trade, from the local elevator, where the farmer was said to be cheated by underweighing, undergrading, and excessive dockage, to the central grain exchanges. Rural agitation brought several plans to reform the grain exchanges before the short session of the Sixty-sixth Congress in the winter of 1920-21. T h e demand for remedial legislation was inevitable, but such reform was not enough to give immediate relief in the autumn of 1920. Grain farmers responded directly to hasty conclusions that the price decline resulted from speculative manipulation by organizing crop-withholding movements—a speculative result of a speculative cause. The farmers' object was to create a scarcity and thus thwart the intentions of "bearish" manipulators by forcing prices upward again. Crop withholding to force prices upward was an idea with origins in the distant past; it had been favorably regarded by groups of farmers earlier in the century without successful application; in 1920 it was a logical scheme to which many farmers would adhere. A wheat strike began in Kansas and spread throughout the specialized wheat regions, its development aided by the National Wheat Growers' Association and state Farmers' Unions. Producers were advised to reduce their planting for the 1921 crop by about 30 per cent. Representatives of southwestern groups met at Kansas City August 20, 1920, and again September 13 to combine forces. They agreed that since the cost of producing wheat was about $2.77, a selling price of $3 was a round figure at which the movement would aim." Outwardly, prospects for the wheat-holding movement were fair. Millions of bushels were pledged to the plan, the 1920 crop was esti-

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mated to be about 170,000,000 bushels below 1919, and exports were at a high level because of European famine and world food shortages. With Russia furnishing very little wheat for export, it appeared that wheat growers were in a strategic position. As early as September 26 the metropolitan press noticed that producers were holding back their grain, and after October 9, when the National Wheat Growers' Association issued a call for a national wheat strike to begin October 25, growers noticeably curtailed their sales." By the end of October wheat had slumped so badly as to drive panicky farmers into the movement. Wheat at $3 within ninety days was predicted on the assumption that the strike would hold together. At the National Farmers' Union convention, President Barrett appealed to the farmers: "Show that you have the moral courage to go to jail, if necessary," and the Union responded with a resolution urging its members and all farmers to withhold the year's crop until a rise in the market price would provide a profit." Branches of the Wheat Growers' Association were formed in several wheat states, but there was no organization that could make effective a concerted farmers' strike in wheat or any other broadly produced crop. Although farmers in some sections held about half the crop as late as December, crop holding in 1920 was primarily the result of individual producers' decisions to speculate on price improvement, which they thought would occur inevitably rather than as the result of agitation. This movement required most holding farmers to arrange for new bank credits or renew old obligations. Old obligations could not be renewed, new credits could not be found to the extent needed for a successful crop-holding movement, and appeals to the Federal Reserve Board and the Treasury for special credit facilities were refused. At a midwestern conference of bankers and farmers in November, C. R. McKay of the Chicago Federal Reserve Bank said that farmers had already borrowed too much and that it was now time for them to sell their produce and liquidate their obligations. Professor E. G. Nourse of Iowa State College replied for the farmers that existing conditions justified crop holding and that any attempt to force liquidation would be disastrous." Toward the end of the crop year, many farmers were still doggedly holding their crop, watching the market drop lower and lower. Farmers determined to improve their position by demanding

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new credit facilities from the government, by considering cropreduction plans, and by hopefully building large cooperativemarketing associations. T h e wheat strike, a sort of mob action, was recognized as inferior to the exercise of "commercial sagacity" by farmers acting collectively through marketing associations. Holding crops for "orderly marketing" was a term most generally associated with seasonal holding of crops and their gradual disposition, although it was sometimes used in connection with sales techniques by which cooperatives skillfully disposed of their supplies. In Bernard Baruch's well-known advice to the farmers, it was simply a matter of doing business in a businesslike way." Seasonal holding of crops by farmers was based on the idea that speculators and middlemen bought low at harvesttime gluts and sold high in the later months when prices rebounded. Added to this belief was the conviction that prices were purposely depressed at the expense of the producer on the one hand and pushed up on the other. Although this was a favorite theory, it lacked statistical support for its basic assumption that after-harvest prices increased much more than enough to take care of storage costs. Among other investigators, Wallaces' Farmer demonstrated to its satisfaction that wheat prices regularly advanced after harvesttime dumping and advised farmers to hold their crops until better prices prevailed." However, the validity of the idea that crops could profitably be held for better prices according to formula was not proved, although farmers continued to expect their cooperative-marketing associations to prosper from such speculation. The successful example of pooling by the U.S. Grain Corporation was still fresh, and farmers concluded that the same success would come to a similarly powerful marketing agency controlled by the producers themselves. In 1921 the National Wheat Growers' Association turned from simple crop holding to plans for a great cooperative pool to control the sale of wheat, as western fruit growers controlled their markets, and began to organize new state-wide marketing associations in the Middle West. At meetings in February and June, 1921, the association dedicated itself to the pooling scheme, looked forward to eliminating the middlemen, and proclaimed the goal of controlling half the crop in some states in 1921 and 250,000,000 bushels altogether in 1922."° Intimately associated with crop-holding ideas, cooperative mar-

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keting, and marketing credit was the problem of storage. Few farmers could store crops on their own farms, local elevators and other storage facilities were limited, and few lending agencies would lend on crops so stored. If cooperative-marketing agencies were to be more than intermediaries, they had to have storage facilities and access to loans on stored commodities. The agricultural crisis aroused renewed interest in the possibilities of expanding the 1916 federal warehousing program to ease the burdens of distressed farmers. Some agitation was heard for federal licensing of corncribs and storage bins even on the farms, and wild schemes were put forward for vast government-owned warehouses, against which special legal-tender currency was to be issued. While plans for changing the federal warehouse system were being considered, the number of licensed warehouses increased considerably, and a growing respect was shown by lending agencies for warehouse receipts as security. Holding price-depressing surpluses a year or more, from years of large production to years of low production—the "Joseph Plan," as it came to be known—«-was another old idea reshaped to meet the agricultural crisis. Advanced by J. A. Everitt in 1905, with little response, it was considered again before the war by Henry A. Wallace who was said to have been inspired with the ever-normalgranary concept by reading a study of Confucius. In his Agricultural Prices, published in 1920, he expressed the belief that it would soon be possible thus to control production variations "in the spirit of doing what is best for society, instead of utilizing the crisis for individual or class profit."51 T h e essence of the Joseph Plan had been given national prominence by the agricultural delegates to President Wilson's National Industrial Conference of October, 1919. In a manifesto describing farmers' problems, the farm delegates urged the building of food-storage reservoirs, where "in time of heaviest production foods should be stored away in such quantities as will tide over periods of non-production," thus taking the curse off bumper crops which returned less profit than skimpier crops.52 Secretary of Agriculture E. T . Meredith was impressed at the time of the 1920 price crash by the fact that big crops were combined with low prices, leaving the farmer "worse off than he has been in other years with short crops and high prices." In his 1920 Report he proposed to help remedy this with a systematic cropholding program.58 The Prairie Farmer, attracted to the idea, at-

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tempted a statistical examination that showed it would be worth while for farmers to hold parts of an abundant crop several years in order to sell at a time of short crops." Professor G. F. Warren, adding to the respectability of the "Joseph Plan," maintained that a single year did not complete the agricultural cycle.™ Thus holding crop surpluses from fat years to lean years became a part of the cooperative-marketing movement, as certain pooling associations found themselves in possession of surpluses they could not market without depressing prices. Pooling projects had entered into orderly marketing with the purpose of stabilizing prices throughout the crop year; then as price manipulation resulted in an annually increasing carry-over, cooperative managers were attracted to the larger view of carrying surpluses over to years of small production. Although some large cooperatives failed disastrously before years of small production brought a favorable price for surplus accumulations, the idea of price-stabilization operations through successive years persisted as a policy for cooperative-marketing associations and governmental relief programs. Congressional

Inaction

After a brief autumn recess, while agricultural prices slumped, the Sixty-sixth Congress met in short session to complete the administration of President Wilson. Previous sessions of the Sixty-sixth Congress had seen the development of agrarian interest in legislative affairs, but beginning with the third session, agriculture gained full stature as a major economic class-interest group applying pressure to the legislative process. Farm organizations in their annual meetings during November, 1920, busied themselves with strengthening their Washington offices and drafting programs for the consideration of Congress. A new spirit of rural defiance was revealed, and nowhere more clearly than in requests for remedial legislation. It was a great change for farm groups to forsake discussions of cultivation, farm management, and education for problems of the Federal Reserve System, rural credits, marketing reform, tariffs, and taxation. T h e new American Farm Bureau, though conservative and businesslike, plainly called upon Congress to relieve the farmer. T h e A.F.B.F. placed its main reliance for economic justice for farmers in the cooperative-marketing movement, but asked the government

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to adjust inequalities that were intensified by government's services to other industries. More than any other farm organization, it knew what it wanted from government, although its requests did not encompass an articulated plan for meeting the agricultural crisis or indicate any clear realization of what was needed to solve the farmers' problems. T h e A.F.B.F., at its convention in Indianapolis early in December, 1920, framed a special memorial to Congress asking for immediate farmers' loans by the Federal Reserve System, a temporary embargo against importing agricultural commodities until tariff legislation could be passed, and consideration of means by which foreign markets could be opened to the greater sale of American farm products. Farmers were told positively that "Congress . . . will no longer ignore the propositions urged by farmers for enactment into l a w . . . . T h e farmers are organized . . . they are talking through authoritative megaphones, with Congress . . . at the big end of the phones."56 Thus at the beginning of the lame duck session it appeared that agriculture would receive unusual attention from Congress. Western and southern congressmen were said to be so anxious to serve the farmers that they would cooperate on legislative matters regardless of party lines, but the fusion caused more notice than unity of action. T h e attempt to organize cohesive congressional action on farm relief had its source in the Iowa Farm Bureau Federation's aim to create a coalition of midwestern congressmen, which would take unified action on matters of importance to the Corn Belt. Six Iowa congressmen, including Senator W. S. Kenyon, met with officers of the Iowa Farm Bureau in Des Moines November 13,1920, to consider legislative needs." Expanded into a combination of members from the South and West, a group had formed to put over some measures for the relief of agriculture.08 The term "Farm Bloc" had not yet been coined, but a bipartisan legislative circle was forming as a response to the farm crisis and it proposed to drive toward credit relief and tariff protection in an organized fashion. T h e farm lobbies were driving congressmen from rural constituencies toward unity on farm issues. The most ambitious among them was the American Farm Bureau's Washington office, whose job it was to keep track of farm legislation, discover what members of the federation wanted, and arrange for the wishes of the farmers to be made known to congressmen whose voting records were sent

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home to constituents as a weapon of pressure. Gray Silver, director of the Washington office, reporting to the Farm Bureau convention in December, 1920, maintained that "ours is not a lobbying campaign, in the sense ordinarily implied at Washington. But we do have a big educational campaign to put forth and the objects to be arrived at are big enough to enlist the best energies of the agricultural leaders in every state."8* Gray Silver and his office unfortunately were led by an overestimate of their influence into an error that lost them good will. Silver had vigorously promoted congressional action to provide for completion of the Muscle Shoals project, thought to be a source of cheap nitrate fertilizer; but the House of Representatives, on January 4, 1921, defeated the Muscle Shoals appropriation bill. T h e day after its defeat the Farm Bureau's Washington office said in a letter to all members of Congress " . . . it is evident to the farmer that the Muscle Shoals appropriation was defeated through the influence of large corporations who have a selfish interest in maintaining fertilizer costs." T h e letter asked congressmen to inform the Farm Bureau's office how they had voted, and reminded them that the Farm Bureau had more than 1,500,000 members interested in legislation."0 T h e presumptuous implications were clear enough and although Congress exhibited no great resentment, A.F.B.F. leaders became alarmed and cleaned house in the Washington office. In fact, the sudden growth of pressure politics as played by the farm groups prompted an investigation by the House Committee on Banking and Currency. T h e committee wanted to know who the spokesmen of agriculture were, not in a spirit of animosity, but for information about the lobbyists and whom they represented.61 Gray Silver revealed methods that were not completely straightforward, and the published hearings provided a handbook of information relating to agricultural pressure politics and conflicts among farm leaders. Although farm pressure politics had come of age in its external characteristics, farm relief could not break through the barriers of a deadlocked lame duck session; passing the appropriation bills was as much as such a session could be expected to accomplish. T h e agricultural crisis was still taking shape, there was no certainty as to what might properly be done, and misunderstanding of the problem resulted in some queer proposals; but a fund of plans was being amassed from which Congress would draw in future sessions. Con-

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gress was as thoroughly absorbed in superficial explanations for the farm crisis and simple remedies as were the farmers themselves and their organizations. T h e agricultural organizations were ready with suggested Federal Reserve Act amendments and directions to the U.S. Treasury to make special funds available, much as emergency steps had been taken in 1914 and 1915 to finance the cotton planters. However, such extreme measures were condemned as "cornfield banking," and had little importance except as they demonstrated the urgency of agricultural requests. An emergency credit proposal that was enacted was an amendment to the Department of Agriculture appropriation bill, providing $2,000,000 for seed-grain loans so that drouth-stricken farmers could plant a spring wheat crop in 1921, with the hope that financial stability would be regained. T h e fund was administered by the Department of Agriculture and provided loans to about 14,000 farmers in the Northwest." Congress considered several rural-credits bills intended to create banking facilities adjusted to the farmers' particular business requirements where private credit failed to fill the gap. Such legislative proposals as the several Kenyon and McFadden rural-credit bills gave no promise of immediate relief, and so farm-credit-relief agitation was directed to the renewal of the War Finance Corporation to relieve the foreign trade dollar gap. T h e Senate Agriculture and Forestry Committee drafted a joint resolution, which requested the Secretary of the Treasury to rehabilitate the W F C "at once" for the purpose of "assisting in the financing of the exportation of agricultural and other products to foreign countries." T h e resolution also directed the Federal Reserve Board to relax credit restrictions against agricultural goods as security so that farmers would be relieved of the current credit crisis. Justification for such unusual action was stated in the preamble: " . . . there exists in the agricultural sections of the country unprecedented and unparalleled distress on account of the inability of the farmers to dispose of the corn, wheat, cotton, livestock, and other commodities now in marketable condition at prices that will pay the cost of production." When Senator Lodge asked that action on the resolution be delayed, Senator Gronna insisted that it go ahead since "in the West and in the South banks by the dozens are failing because farmers are unable to market their products. It is a real emergency."® Senator "Cotton Ed" Smith spoke of the W F C as a foreign aid program to

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restore Central European nations by facilitating the flow of raw materials, a recovery that would enable Central Europe to stand as a "great stone wall against which the waves of Bolshevism might roll, to be hurled back, doing no harm."" Champions of the W F C resolution became quite bitter in their antagonism toward Secretary Houston, who seemed to stand in the way of relief for suffering farmers. Opposition to the W F C resolution came from those who disliked the section directing the Federal Reserve Board to allow more latitude for accepting agricultural products as security. Senator McLean, believing this part would have no value at all, was reminded of the comment of a foreign ambassador upon taking his first drink of grape juice in dry America. He said, "It looks good, and it tastes good, but does it accomplish anything?"" A significant argument against the WFC measure was that it would be a paternalistic subsidy to agriculturists as a class. T h e W F C renewal resolution, without the Federal Reserve Board section, was rushed through Congress in December with votes indicating strong sectional division. President Wilson returned the measure on January 3, 1921, with a veto message, written by Secretary Houston, which denounced on principle the engagement of the government in banking business in peacetime." Exhorted by farm groups, the Senate and House both immediately repassed the resolution with ample majorities. Passage of the War Finance Corporation renewal caused a sharp advance in grain prices; the gains, however, were erased when it became apparent that the W F C would not be immediately effective nor could much be expected from it until a friendly administration determined its policies. Attached to the W F C renewal was the hope that embarrassing surpluses could be moved out of the domestic market. Since it could not be made to function quickly enough to relieve the winter crisis of 1920-21, alternate plans for subsidizing surplus disposal were advanced. Various suggestions were made for aiding European and Chinese famine by donations of surplus farm products. T h e idea was expressed that "it would be a good move . . . to ask of Congress now that they cut the estimate of the appropriation for War and Navies squarely in two, use the balance, which would be approximately five hundred million dollars, to buy food and clothing in the raw state and give to the people who are starving. I t . . . would be

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a better protection for the government than our Army and our Navy can be."" Congress took little note of such ideas, but an important movement was begun unofficially by Herbert Hoover to secure donations of surplus corn, for sale in the United States, to gain funds for European relief. American Farm Bureau officials persuaded Hoover to change his plans and accept corn for direct shipment. Governor Kendall of Iowa suggested the government help by devoting one-half of the accrued interest on the uncollected war debt to buy corn for the starving people of the world.*8 A notable plan for farm relief involving government price stabilization came before the Sixty-sixth Congress as the Christopherson bill. This provided for a government commission to fix minimum prices for staple crops on a cost-of-production-plus-profit basis and to buy the unsold surpluses at the end of the crop year for sale abroad. Originally developed by W. H. Lyon of South Dakota, this plan was quickly accorded national attention, but responsible leaders were not yet prepared to give it their endorsement. The Christopherson bill languished in the House Committee on Agriculture but was brought before the committees conducting hearings on renewal of the War Finance Corporation, and it was widely circulated as a pamphlet." An emergency tariff to protect agricultural prices led agrarian legislative demands in the winter of 1920 and secured unprecedented unanimity among farmers. Tariff protection seemed as simple as this: "If industry demands a high tariff and it is conceded to be for the good of the whole country, then agriculture also demands a high tariff." Little consideration was accorded the idea of equalizing tariff protection by removing tariff subsidies to industry."1 Farmers talked of an embargo against certain commodities and even against all farm products and, though some would have settled for reenactment of the old Payne-Aldrich schedules, most were satisfied with the Fordney emergency tariff bill. Against the farmers' demand for emergency tariff protection were Democrats who stood by principle, and those who considered a tariff for farmers to be a trick. It was argued by eastern Republicans that farmers should wait until the Republican administration gave the whole tariff a thorough revision, and that a special tariff for agriculture would not only give farmers an undue advantage but would further depress industry by holding up the cost of living and

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therefore the cost of labor, making it difficult for manufacturers to export." Farmers could scarcely have been expected to heed such reasoning, nor could they be convinced that adoption of high tariff policies on their products would work against them by restricting farm-export markets and by leading the way to more protection for manufacturers. Opposition to the agricultural tariff also pointed out that the new creditor status of the United States complicated traditional tariff policies and exposed the false economic principles whereby producers of surplus crops hoped to gain from tariffs. Senator Moses could not forbear defining this tariff as "the offspring of a union between the cotton field, the sugar-cane brake, the rice paddy of one section of the country, and the sheep run, the cattle range, and the wheat field of another section. It is a misshapen brat at b e s t . . . and it suffers from congenital economic rickets."™ The main purpose of the framers of the emergency tariff bill was to satisfy the agricultural demand and—perhaps—give farmers some price relief. On the hit-or-miss formula that products which had declined 50 per cent in value deserved protection, prohibitive rates were for a period of ten months to be laid upon a long list of farm products. Debate on the bill began before it was introduced December 20, 1920, and it was rushed to adoption by the House two days later after the bipartisan coalition of western and southern representatives had agreed to speed its progress. It was delayed in the Senate and not sent to the White House until March 1. President Wilson quickly returned the tariff to Congress with his historic veto message. After noting that the farmer needed markets rather than tariffs and that little gain could be expected even in the short run, the president moved on to the bill's larger meaning: " I imagine there is little doubt that while this measure is temporary, it is intended as a foundation for action of a similar nature of a very general and permanent character." The message was reasoned and prescient: "Clearly this is no time for the erection here of hightrade barriers.... It would stand in the way of the normal readjustment . . . throughout the world, which is as vital to the welfare of this country as to that of all the other nations. The United States has a duty to itself as well as to the rest of the world, and it can discharge this duty by widening, not by contracting, its world markets."™ An attempt to override the veto in the House failed to receive the necessary two-thirds vote. Farmers, however, were impatient with

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one who knew better than they what they needed, and it was certain that the measure would be repassed in the next Congress. With the end of the Sixty-sixth Congress, farmers could point to no legislative achievements that gave real promise of relief. T h e farm situation was going from bad to worse, and Congress was capable only of talk. The great variety of relief and reform plans were carried over to the next Congress. Meanwhile, farm groups, disgruntled at their lack of success, became more insistent upon congressional legislation for agriculture. At a time when policies were taking shape that would guide the nation through a postwar decade, the agricultural crisis was so deep that rural forces were driven to the support of economic inconsistencies and class-interest measures. When leaders of Congress were willing to recognize the need for remedial farm legislation, their first moves were precedents for appeasement, not repair.

•

Chapter III

Farmer Self-Help •

Farmers confronted with falling prices knew that price-making influences were beyond their individual control. Farmers hoped that combination in cooperative associations and other organizations would influence markets and governmental price policy; but as individuals, steeped in a tradition of self-reliance, they believed that they could be saved through application of rigorous economies. While railing at remote conspiracies, deploring the ingratitude shown them by government and industry for a bountiful supply of food and raw material, and while dreaming of projects to restore vanished price levels, farmers were hard at work striving to make ends meet. The Search for Individual

Solutions

The agricultural crisis was reflected on farms in curtailment of cash expenditures. Although high fixed charges such as taxes and interest were unavoidable, it was possible to cut back many costs of production. T h e farm family was forced, painfully, to step down from the high point on the scale of living to which several years of prosperity had advanced it. Lessened cash income resulted in interruption of education and lower levels of health and happiness, profoundly disappointing to farm people when the interruption settled into a long-term condition. Drastic retrenchment in expenditures meant, for another thing, reestablishing in the home produc76

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tive activities that had migrated to the factory. Home slaughtering, canning, dressmaking, baking, and amusements were revived, although by this time these former functions of the farm home were performed in the city with gains to nearly all involved. A twentiethcentury standard of living was jeopardized when the crisis deprived farm families of their buying power, and though such turning back of the clock might be justified to meet a temporary shortage of cash income, it was to lead to dangerously low standards of consumption by the nation's farming population. In addition to practicing stringent economies, farm families occasionally sought supplementary income. Household manufactures and crafts found renewed interest, although the widely advertised Gearhart knitting machine was a heartbreaking fraud. Extra dollars could sometimes be earned by cutting timber, posts, and railroad ties from those farms with woodlots. Farmers also sought occasional employment in towns and cities. On commercial farms production expenses were the largest, and therefore the most subject to retrenchment. Hired farm labor was an expense that could be pared down by employing family labor, even if it meant women working in the fields and the premature termination of schooling for children. Obsolete farm machinery was not replaced, and worn-out equipment was wired together to "make do." In time it would become plain that practicing "boomerang economies" by getting along with what was at hand and slipping backward in efficiency was false economy, that the farmer was "constrained to save at the spigot so constantly as to induce serious waste at the bung-hole."1 Farmers were impressed with the here-and-now problem of making the best of their resources, and their most successful efforts to save themselves were attacks on the problems of production with improved methods. There was no longer a frontier of good cheap land, no unearned increment in farmland value, no rapidly expanding urban market, no stable foreign market. There was, however, a frontier of production efficiency which provided the best approach at hand. Gains to be made from greater productive efficiency were theoretically vast, but practically somewhat less. Farmers, though impatient with theorists who discounted practical limitations on increased farm efficiency, nonetheless made great gains during the agricultural crisis, gains which also helped compli-

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cate the farm problem by keeping up the volume of surplus crops and sharpening competition among farmers. The farm crisis came at a time when agricultural science and technology were prepared for a long forward step in operating and distribution efficiency. Chronically low prices compelled farmers to give up haphazard guessing and superstition; they had to plan, calculate, and learn. President W. M. Jardine of the Kansas State College of Agriculture came to Washington with a request for more assistance for cooperative extension work and with a statement that "the farmers of Kansas are looking to the agricultural colleges for help as they have never looked to them before."2 "Farm management" was an indefinite term, which came into wider usage with the farm crisis. Among its accepted aims were better cultural methods, use of disease-resistant seeds adapted to soil and climate, application of fertilizers in tested quantities, adoption of insect and disease controls, modification of rotation schedules to achieve specific ends, careful use of machinery, and the keeping of farm records, with constant study to determine new means for further improvement. In this movement to bring the results of agricultural research into practice, farmers had the unanimous encouragement of many public agencies designed to aid agricultural progress. Cost-accounting procedures and business bookkeeping had been symbols of progressive methods in farming for many years before the crisis, and now bookkeeping was at the heart of the professionalization of agriculture. T h e new farmer regarded farming as a business enterprise, which must provide an interest return on investments and payment for labor, as did urban commercial enterprise. Although such conclusions played hob with the fondly held traditions of farming as a way of life, its ancient virtues continued to be expounded by sentimentalists. In 1927 it was maintained by that protean hero of agriculture, Liberty Hyde Bailey, that "it is the farmer's rare privilege to raise crops and rear animals. T h e sheer joy of the thing is itself a reward.... It will be a calamity if we sacrifice this vast reward by insisting so exclusively on a financial or business view of agriculture. By such insistence we shall make the occupation sordid."* So essential did record keeping seem to the improvement of the farm business that work .was begun in 1920 and 1921 by county agents and farm-management demonstrators to help the agricultural colleges spread the idea. Account books

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were sold at cost and "schools" were conducted to acquaint farmers with the elements of bookkeeping. Such work was expanded in 1922 and still further in 1923, aided by a recommendation from the Joint Commission of Agricultural Inquiry that "adequate Federal appropriations should be made for the promotion of better book and record k e e p i n g . . . as a basis for the development of more efficient methods of farm management."1 Agriculture's price crisis occurred when the farming industry was in the midst of a powerful technological revolution, which burst forth suddenly after World War I and was to gain momentum for several decades following. Mechanical changes in agriculture were to introduce such new problems as farm consolidation, surplus labor, credit for new machines, outlets for products grown from vast acreage previously devoted to sustaining horse and mule power, and new cropping schedules. Over-all crop production tended to increase with mechanization, and greater production meant not salvation but lower prices and more hardship for those who were unable to keep up the pace and yet did not forsake farming. T h e agricultural implement industry felt the pinch of the farm crisis immediately. Whereas the total dollar sales of farm equipment in 1920 had been $471,442,000, it dropped to $222,908,000 in 1922.5 Decline in farm-equipment sales so obviously interrupted farm mechanization that the industry tried at first to meet the decline by the revival of installment buying on low down payments. Sales promotion expenses were reduced by cutting down on costly demonstrations and extravagant advertising. New models were not produced with such prodigality as before, caution replaced audacity in design, and as equipment firms failed, there developed a new standardization and concentration of the industry. T h e depression in the equipment industry provided an object lesson in agricultural fundamentalism: the revival of farm-purchasing power was an essential first step toward recovery of the national economy. Tractors symbolized the new order of mechanized farming. Sales of gasoline tractors held up better during the crisis than did the sales of other equipment, sales for 1920 totaled 162,988 and 101,192 for 1922.' At the center of the technological revolution in agriculture, tractors were not just a substitute for horses and mules but involved deep-reaching shifts in farming operations. They were

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large and expensive, requiring larger-than-average farms for effective use, being used primarily for heavy tillage and harvesting and for belt work, and frequently requiring supplemental horse labor. Furthermore, tractor farming demanded adjustment of the farm layout and required mechanical skills not always possessed by farmers. Heavy tractors packed the damp springtime soil, there was difficulty in making repairs, and they were notoriously hard to start, especially the kerosene-burning models. An Illinois farmer was "ferninst" the tractor, another said they were "too trappy," short-lived, and expensive to keep up. More than any other factor, however, low income prevented farmers from buying tractors. A familiar view was that "the worst thing about tractors, there ain't no way to breed them."* The auto, the truck, the combined harvester and thresher, and the mechanical cornpicker were, like the tractor, revolutionary influences on the scene shortly before the crisis occurred. Although the depression delayed their full impact, new problems for the farmers derived from such machines. With the adjustment to a machine technology as well as to lower prices, the size of the average farm grew and the number of farms declined, although there was no marked increase in the number of very large farms. Outside the South and East, where much farmland was abandoned, agriculture seemed to be undergoing a wholesome transformation, from the business point of view. Significantly, industrialization of agriculture, both hoped for and feared, did not occur. Henry Ford and Frank O. Lowden were prominent exponents of mechanized "pooled" farms as a solution for the farm problem. But despite much talk of commercial farm management, chain farming, and corporation farms, these projects replaced an insignificant number of family farms during the crisis period. Farm abandonment and the movement away from agriculture were more complete adjustments to adversity than farm consolidation and often more helpful to the individuals. Reversing the historic growth of farm acreage, number of farms, and farm population, the agricultural crisis brought startling net reductions in all three measurements. The farm-to-city drift was well established; the rural population had for a long time fed much of its rapid rate of increase into the urban group. During the crisis period

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8l

the cities absorbed not only their regular increment from the country but enough more to create a net loss to agriculture, although an industrial depression increased a back-to-the-farm movement among those who had drifted away during the war. Farm population showed net losses of 478,000 in 1922 and 234,000 in 1923-' Powerful and immediate pressures were compelling some farmers to leave the land. An eastern newspaper editorial, "Starving the Farmers," described the farm-city drift as a "flight from penury."9 Advertisements in farm journals illustrated the economic motive for migration away from farms: "Trade Your Mortgage for a Garage. . . . Get into a profitable business." With a decline in construction of permanent improvements on farms, the advent of labor-saving equipment, and the prospect of longer years of productive activity for farmers, there was simply not enough room for the old labor force, even without the complications of low crop prices. Employment opportunities existed for farmers in the city after the industrial depression of 1921, and familiar advantages of city over rural life continued to have their drawing power for farmers: bright lights, a higher standard of living, shorter hours of labor, and better monetary returns. The unusual movement of farmers into city occupations was regarded as both helpful and dangerous to the nation. In 1921, it was still possible to urge a back-to-the-farm movement. A journal of business affairs had viewed as a "hopeful sign" the return of wartime labor to the farms, supposedly to result in lower prices of foodstuffs and in relief for the acute urban housing shortage.10 On the other hand, the farm-city shift was viewed with favor and encouraged by farm journals and leaders, who saw in it a means of reducing industrial wage scales as well as relief for overproduction and low prices in agriculture. T . C. Atkeson, National Grange lobbyist, told a congressional committee that "the indications now are that we have raised too much stuff already; and, as a farmer, if half the people who are now on farms would go to town I would like it. . . . If all these fellows will just keep on leaving the farms, I will be up ahead after a while." u Yet as the shift of farmers out of agriculture grew, fears for the social and economic stability of the country revived. As far back as 1909 the Country Life Commission had

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expressed the widely adopted view that the cityward drift tended to "sterilize the open country and to lower its social status," as the best blood of youth and the wealth of retiring farmers were drained away from farming." Eleven years later, the same alarm was voiced by Secretary of Agriculture Meredith, who wondered whether "those who remain in agriculture after the normal contribution to the city are the strong, intelligent, well-seasoned families, in which the best traditions of agriculture and citizenship have lodged from generation to generation."18 Proceeding upon the theory that farm youths having ambition and initiative moved to the city while the culls stayed at home, rural sociologists became imbued with a settled pessimism. A special article in the New York Times quoted a New England farmer: "This old farming community is like the fish pond with the game fish all fished out; all we've got left now is the bullheads and suckers."" T h e same article cited a study by Professor Macy Campbell of Iowa State Teachers College, which assumed that the country was devastatingly affected by the loss of 80 to 95 per cent of the farm youth with intelligence and spunk enough to get a high school education. Up to a point the loss of surplus farmers could be regarded favorably, but it came to be feared that the change was going too far. Farm abandonment and consolidation left weed-grown fields and vacant farmhouses. About 14 per cent of the habitable farmhouses of the nation were vacant in 1922, and a survey of Michigan in 1923 showed fully 10 per cent of the farms to be idle. Between 1919 and 1924 there occurred a 3.25 per cent decrease in the number of farms and a 7.8 per cent decrease in cropland; the decrease in crop acreage was the first ever shown." Despite such tendencies, there remained many submarginal farms worked by submarginal farmers, adding to the production of surpluses and making it difficult for more progressive farmers to maintain a sound business. Farmers who remained in the business were handed much wellmeaning advice about diversification as an individual adjustment to low prices. In certain areas diversification varied the sources of income for individual farms and shifted them from the single-track production of soil-exhausting crops to patterns of operation sustaining their productive ability. One view of diversification was that several sources of income made for less risk from fluctuating

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prices; but this was difficult for those farms where credit, equipment, and farm organization were geared to specialization, and where the dictates of geography allowed little flexibility." Resistance to diversification could not be dismissed as indicating a preference for lazy farming since farmers were not indifferent to economic determinants. T h e theory, however, became a cure-all for an agriculture cursed with production of surplus staple crops. Dairying was most frequently suggested as the obvious alternative to cash crops, regardless of the probable surpluses of milk and butter that would result if many farmers chose that activity, or the special skills and equipment required for efficient dairying. Nor was dairying an occupation that returned much to the transient; it was a complex undertaking and one of the most conservative types of farming. Moreover, the movement into dairying caused additional trouble for that industry in later years. Many other alternate crops were suggested—for example, nuts, Christmas trees, goats, and fancy poultry, all by their nature close to market saturation. Materially aiding diversification in the Middle West was the introduction of soybeans, which "arrived" as a standard crop in 1921 and 1922, complete with a promotional "Soy Bean Day." Diversification was clearly not an immediate or generally practicable solution to the farm depression. It found favor with those who believed that the farmer could and must work out for himself an adjustment to changed market conditions, and it was the theory behind the Norbeck-Burtness bill of the Sixty-eighth Congress, which proposed federal credit aid for diversification of wheat farming in the Northwest. Those farmers who sought quick and dramatic action regarded it with suspicion, but the theory came to be an important part of campaigns for crop restriction as a means to improve price. Efforts to redress the farmer's unfavorable position through greater efficiency, reduction of cash outlay, or diversification generally did not succeed. Six million farmers, working independently and competing against one another for the gains of agricultural improvement, made little financial recovery. As individual efforts failed to lift agriculture out of its economic rut, farmers turned with growing interest to collective efforts to improve the price situation and regain satisfactory living conditions.

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Crop-Reduction

Schemes

Farmers moved several steps away from traditional individualistic isolation when, spurred by disastrous price declines, they sought to help themselves through association. They quickly went beyond group action to improve their business efficiency and to exercise legislative pressure; they responded directly to the depression by associating to influence prices through control of supplies. Since bountiful crops frequently brought less income than short crops, farmers were receptive to the idea of production control that would flatten out fluctuations caused by variable supplies and speculation. So long as quantities of farm produce glutted the market, with large new crops in prospect, crop holding was hopeless, and farmers therefore turned attention to means for voluntary surplus eradication. Some seriously believed that a holiday should be called in agricultural education, research, and public aids for farm improvement, since these activities only augmented the surplus problem and added to taxes. Such proposals were eliminated from responsible consideration by their patent lack of good sense, but many columns of farm journals had to be devoted to patient reiteration of the virtues of farm progress. It was anticipated that, eventually, automatic curtailment of price-depressing surpluses would come about as farmers were discouraged by low prices from producing the surplus crops. Such a change seemed logical since production had been stimulated by high prices during the war emergency; however, it was soon to be shown that price was an unimportant influence upon volume of production. Adjustment of production to conform with market conditions—an old idea—was vigorously championed by many farm leaders whose efforts in this direction illustrated the hold that commercial standards and techniques had gained within agriculture. As the manufacturer studied demand and gauged production to agree, so should the farmer. Economic management and regulated competition would, it was urged, bring agricultural supply and demand into balance. Most of the production-control thinking was based on domestic demands, a nationalistic view expressed by the economist David Friday when he suggested that one important means "for getting the farmer out of trouble is to take him as far as possible off the international market."" Farm

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leaders hoped that agricultural adjustment would be achieved through the response of intelligent farmers to the facts of surplus production—facts provided by the Department of Agriculture. However, the program was mild and unappealing to those who desired agriculture to be more aggressive in seizing a better share of the national income. Production restriction to enforce satisfactory prices seemed to many farmers merely a logical expression of a commercialized agriculture, and the difficulty experienced with simple crop-holding movements was driving others to talk of a nation-wide producers' strike." Cotton-price losses in 1920 and the failure of efforts to enlist Federal Reserve support for a cotton-holding program resulted in a popular movement to reduce acreage in 1921 by one-third to onehalf. T h e American Cotton Association proclaimed that another large crop would be "folly unspeakable" and took the lead in urging acreage restriction together with diversification as a "safe system of farming." 1 ' Unusual efforts were made to gain acceptance for a program of acreage restriction, The Cotton News was published to carry propaganda for curtailment, and the state administration of South Carolina proclaimed a "Cotton Acreage Reduction Day" to secure pledges for cutting acreage. Merchants and bankers who had cotton on hand brought pressure to bear upon farmers for a cutback, and conditions were made decidedly uncomfortable for those who did not conform.20 This campaign was better organized than earlier ones and apparently overcame the inclination of producers to increase planting so as to take advantage of the prospective shortage with its higher prices. Added to reduction incentives in 1921 there was the baneful shadow of a large carry-over, which indicated low prices ahead.21 T h e unprecedented drop in acreage planted to cotton in 1921 amounted to a reduction of 25 per cent from 1920. Boll weevil damage cut the yield per acre to a record low point and the total crop to its lowest since 1895—5,486,000 bales below 1920—yet price increases did not cover the loss of income from fewer bales. Clearly, production restriction was not an easy answer to farmers' economic problems. Nevertheless, later gains made in cotton prices were claimed to be the result of acreage reduction and provided encouragement for efforts to control production of other crops. In the tobacco borderland, disastrous results of expanded pro-

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duction in 1920 stimulated early ideas of acreage restriction and talk of a complete one-year suspension of tobacco planting among Burley growers. T h e outstanding success of the Burley "cut-out" in 1908 was recalled as an example of what could be done, although the record of violence attending previous production-control efforts caused some revived apprehension. In this area attention was diverted from acreage restriction to cooperative-marketing solutions, which gave promise of meeting the requirements of tobacco planters for price relief, until in 1924 accumulated surpluses renewed drastic cut-out proposals. » Not until the postwar crisis had the Corn Belt given wide attention to production-restriction ideas. In 1919 and 1920 Wallaces' Farmer, almost alone, attempted to develop sentiment for reduction of corn acreage and warned against the evils of expanded corn production. Henry A. Wallace believed that farmers should develop "close-knit organizations" to practice "sagacious sabotage"—meaning production restriction—"in the same scientific, businesslike way as labor and capital."22 Before and during the 1921 cornplanting season, Wallaces' Farmer again attempted to persuade farmers to work a change in the Corn Belt's overemphasis upon corn. Under the reiterated slogan: "Grow more clover, we are growing too much grain," Wallace urged farmers to "bank" their fertility in the soil by raising less corn and more legumes; "clover helps to maintain the soil fertility" and "keeps the land in good heart." A mountainous "super surplus" of corn, a half billion bushels above normal, was an argument for a 20 per cent reduction in production, which would bring about only a normal carryover in the spring of 1922. Wallace suggested that participation in corn-acreage reduction "will be strengthening the position of the farmer as a class," and he cited the Levitical law to the effect that the land should be given a sabbatical rest.28 During the spring of 1921 there was no marked response to the corn-reduction advice of Wallaces' Farmer. T h e Corn Belt expected the crisis to be transitory in nature, and the full impact of lower prices had not yet been felt in this section. Furthermore, a surplus of oats prevented corn growers from shifting profitably to that crop, a foremost alternate. The logic of legumes was convincing to newspaper editors but less attractive to farmers in need of cash. As it became apparent that the 1921 corn acreage had not

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been influenced, Wallaces' Farmer dwelt upon methods of organized pressure to control crop acreage. Farm organizations were urged to get behind an active campaign utilizing the methods of wartime Liberty Loan drives. Perverse weather and perverse farmers produced a bumper 1921 corn crop. Corn acreage in 1921 was 2,000,000 acres above 1920, and weather conditions in 1921 were so favorable for large yields that total production was above the 1914-1920 average by 237,000,000 bushels.24 T w o bumper corn crops in succession moving onto restricted markets created an undigested surplus in the fall of 1921 that forced prices down to the desperation level of 41 cents in November, less than half the average price for the same date during 1914-1920."° In some localities corn fell to 15 cents per bushel. Spurred by the price debacle, Wallaces' Farmer in September, 1921, started to urge development of another crop-reduction program for 1922. T h e Corn Belt state federations of the Farm Bureau were called upon to establish systematic county and township acreage quotas, to be enforced by social pressure upon individual farmers. Although Wallace was later to say he had secured the "whole-hearted backing" of the state federations, their participation was far less than he had hoped to receive.26 Lip service was paid to the purposes of corn reduction, but farm-organization leaders drew back from the suggestion of compulsion contained in establishing quotas. T h e plan received general endorsements from midwestern farm organizations, several farm journals, and individual farm leaders; but no one and no important group was willing to do more than encourage the work of somebody else to make the campaign effective. T h e Iowa Farm Bureau Federation resolved in January, 1922, that it should present the facts on corn reduction and acreage to its membership, but "we entrust each farmer to adjust his acreage in accordance with his own judgment."27 In any plan for voluntary crop restriction to increase prices, the individualist intending to profit from curtailment by others was a problem. Noncooperation was certain, for the farmer could see that as an individual he could never gain from producing less. N o denunciations from the farm press were likely to banish the independent who was "the despair of organized agriculture, and the

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hope of all those who prey upon agriculture," a "scab" and "a traitor to his fellow farmers."28 Corn-acreage limitation schemes roused a vigorous opposition, which made effective use of emotional symbolism connected with food, its destruction or nonproduction being widely regarded as sinful. Opposition came from agricultural leaders who believed that remedies should be found in drastic reforms of marketing or subsidized export of corn and hogs. Farmers who were primarily livestock feeders rather than corn producers saw cheap corn as a raw material advantageous to them. Standing powerfully against the movement were grain traders and urban industrial interests who were fearful of increased costs of living.2" Corn-acreage reduction in 1922, falling far short of the goal, remained entirely voluntary and informal. During the spring planting season unfavorable weather delayed the planting of substitute crops on corn acreage, and many farmers went back to corn. In the end, national corn acreage for 1922 was only 894,000 acres less than 1921 when 103,740,000 acres were planted; and in the Corn Belt, where the acreage-reduction idea had been most diligently pushed, there was a distinct increase in acres planted to corn.80 The severe wheat crisis in the fall and winter of 1920 had stimulated many schemes for price enhancement and surplus disposal. T h e National Wheat Growers' Association had included production limitation with its crop-holding movement in 1920, but had devoted its attention almost exclusively to the holding scheme and then shifted to cooperative-pooling plans. A committee of the National Agricultural Conference in 1922 recommended a 15 per cent reduction in wheat acreage, suggesting summer fallow or cover crops as substitutes, but it did not propose any plan for implementation or suggest means by which farmers could otherwise improve their income.31 By 1923, despite a 4 per cent decline in acreage, surpluses had accumulated as export markets had declined, bringing to the wheat farmer his full measure of the postwar crisis. When it was thus apparent that return to tolerable conditions would not be automatic within the span of a season or two, wheat producers began to think more seriously in terms of organized acreage limitation. Wherever the crop-restriction idea appeared as a plan for solution of the agricultural crisis, it met with discouraging results. So

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long as markets for their wealth seemed to be made unavailable by artificial and selfish barriers, farmers kept hoping that other and easier means could be found by which prices would be improved. Farmers usually operated at full steam. Inefficiently used or abandoned acres meant a loss of capital and contradicted new determination to operate the farm as a business. The modern farmer had a large capital investment in his established course of cropping. Diversified farmers, enmeshed in a biological rather than a mechanical industry, were incapable of shifting into and out of different production systems. Representative G. M. Young of North Dakota told a congressional committee: "The farmer can not shut down the works. . . . He has got a machine that is wound up, and he has got to stay by it. He has either got to quit for good or stay by it and take his loss.'"" Natural variables, important to the farmer in deciding upon participation in crop-limitation movements, would also have done much to frustrate any large-scale movement such as might have been organized during the crisis period. During the years 1921-1923 especially favorable growing conditions produced bumper crops in most of the major farm products. If crop restriction were to be successful in other than minor specialty crops, it involved guidance and conformity to be had only through the supervision of governmental authority. During the crisis period preliminary thoughts forecast the political supervision of crop limitation that was to develop in the future. Henry A. Wallace stated the view that if there was no way for Europe to pay a cost-of-production price for American surpluses, it was the "part of wisdom for a courageous, clearsighted government to tell the farmers frankly and to aid them in readjusting their production . . . so that their supply in the future will more definitely fit the demand at a price representing cost of production one year with another."38 Discussions of federal price stabilization raised questions of how to avoid surpluses by limiting production. Milo Reno, a leader of the Nebraska Farmers' Union, argued for a guaranteed minimum price on certain commodities, saying that if the farmer "had some basis to work from he might perhaps restrict his acreage intelligently . . . I think that by fixing a price you can regulate the proper acreage perfectly without any other effort but that."84 More realistic and farsighted than Milo Reno was Representative Young

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of North Dakota, who supported crop limitation as a corollary to government wheat-price supports. "There are a great many ways in which you can limit the acreage," he said. " T h e first one that suggests itself is that no man should get the advantage of a price guaranty unless he submits to a certain direction in respect to acreage."" Farmers were moving forward on a ragged front toward adoption of economic forms and attitudes, which would limit competition within agriculture and put it in a stronger position. Benjamin H. Hibbard told a group of economists that "probably no other class, or group of people so great in numbers, with so high a level of intelligence, have during the past eventful century and a half remained so passive, and taken its share of the social dividend with such resignation, as have the farmers."™ T h e postwar agricultural crisis marked the end of this passivity and the beginning of farmers' aggressive determination to participate in price management. By 1923 and 1924, with the troubles of agriculture persisting, discussions of crop control and ideas of government price stabilization dominated agricultural relief agitation—and for many years thereafter. Agricultural

Cooperation

Scattered farmers, at a competitive disadvantage for getting a proportionate share of the national income, sought through cooperation to retrieve command of their own economic destiny. Rapid postwar concentration of economic power, a realization of disadvantages among the farmers, and an agricultural crisis brought the cooperative movement the most conspicuous attention and faithful adherence it has ever received. In 1920 farmers were looking eagerly beyond the limits of local cooperative movements to a form of organization capable of price stabilization as well as distribution economies. Farmers had previously criticized aggressive business methods used by middlemen, but now the scheme was to get the better of the distribution system on its own ground. Bernard Baruch and other experts of business and politics told the farmer that all around him in the modern world he was met with organization where production and selling were concentrated in specialized hands; as a result, because he was not organized, he was not receiving a fair share of what he produced."7 With the

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Farm Bureau in the lead, large farm organizations were caught up in the movement and justified their existence primarily on the basis of aiding farmers to form cooperatives. President Barrett grandiloquently told a Farmers' Union convention, "the time is surely coming when the farmers of this Nation will conduct practically all of their business" through cooperatives; and the Wisconsin Society of Equity actually launched a program for the coordination of all business undertakings of its members in which group action was feasible.88 A peak in the formation of new cooperatives was reached in 1920 when 1,967 marketing and purchasing associations were founded, bringing the number to 13,212. T h e curve of discontinuances followed the growing number of associations, but the great period for farmers' cooperatives, both in number and size of operations, was the years 1921-1925.™ In 1923 a publication of the Department of Agriculture, struck by the "spectacular" and "prodigious" progress of cooperation in the two preceding years, estimated the cooperatives to be handling 10 to 15 per cent of the total farm produce." Cooperation possessed an ideology of reform and brotherhood attractive to isolated farmers and to agriculture's urban friends as well. American agricultural cooperation, preeminently a business matter, did not adopt the zealous socialistic viewpoint of British cooperation; nevertheless, the movement benefited from altruistic motives and the vision of social justice.41 As a reform movement, it undertook to by-pass unnecessary middlemen and speculators who were "parasites" on the distributive system, fattening at the expense of both producer and consumer. Very few farmers adhered to the idea of reforming the profit system; they wanted only to retain for themselves some profits of distribution. A rush of experiments in association was undertaken, with full faith in their ability to solve the farmers' problems immediately, and many long steps in the evolution of cooperatives were compressed into the brief span of the agricultural crisis. Although much wreckage resulted from grandiose projects, jerry-built on unsound foundations or in poorly prepared areas, many profitable lessons were learned to later advantage. Yet, considering the whole field of potential cooperative endeavor and the sharp stimulus of deflation, accomplishments were meager. Theoretically, close economic

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integration of farmers was possible, but it was flimsy reasoning that agriculture was unprosperous because it was unorganized—that organization alone would bring prosperity. Achievement of cooperation's goals was blocked by marketing interests that cooperatives aimed to displace, by false assumptions that marketing costs could be radically reduced, and by an ingrained individualism which a short-term boom in cooperation could not overcome no matter how great the farmers' economic hardships. T h e scattered nature of farming and a tradition of self-reliance kept farmers from submitting to the conformity required by successful cooperation. Secretary of Agriculture Wallace saw that "there is a centrifugal force in every cooperative organization that tends to put members away from it."" That cooperatives failed to reach their goals was attributed primarily to poor management and the independence of farmers. Even where farmers had the wisdom to pay an adequate salary to their association manager, he was frequently a discard of business or someone without adequate grasp of the technical problems peculiar to cooperative enterprise. T o meet the need for competent professional cooperative managers, agricultural colleges were requested to establish courses in marketing and cooperation, and some state Farm Bureaus provided cooperative-marketing fellowships as a means of training needed personnel. Cooperation in the areas of services, credit, and buying received increasing acceptance among farmers as agriculture became more complex and dependent upon outside institutions, although attention was riveted to more exciting marketing projects. In 1922, the peak year for number of associations, there were more than six times as many marketing co-ops as purchasing organizations." Cowtesting and seed-improvement associations functioned successfully, and cooperation performed an essential service in making available purebred sires for dairy and meat-producing farmers. Cooperative ownership of scales and tractors existed in neighborhoods, and cooperative trucking companies were examples of association to meet new problems of capital investment. Farmers combined to secure irrigation facilities, telephones, electricity, and medical services, thus engaging in a form of association not unexpected among an imaginative people. T h e cooperative operation of farms,

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strange to American farmers, remained a negligible part of agricultural association. Farmers were markedly successful in associating to insure against unusual losses from fire, hail, death, and other catastrophes. Farmers' mutual insurance companies, frequently in connection with the large farm organizations, became a familiar part of rural economic activity, establishing an unusual record of success in performing real economies for farmers. In 1921, 1,952 companies carried $10,528,000,000 of fire insurance (40.4 per cent of the insurable farm property), at a rate of 27 cents per $100 of insurance." Cooperative credit associations were a special type of farm association both because of the unusual hopes attached to their service and because of governmental assistance for certain forms of cooperative credit. The idea of producer-controlled credit caused labor organizations to be interested in the Bank of North Dakota and farmers to be attracted to the Railway Brotherhood's bank in Cleveland, Ohio. Responding to a wave of interest, the Farmers' Union convention in November, 1920, adopted a resolution urging the organization of cooperative banks "that would not be shackled by obligations to privilege and monopoly."" Under the Federal Farm Loan Act of 1916 provision had been made for the creation of a system of farm-loan associations supervised by the Federal Farm Loan Bureau. Designed to ease the burden of mortgage debt, loan associations found rapid favor among farmers who wished to refinance their debts at lower interest rates under terms of the new system. After an initial wave of founding associations, farmers often lost interest in maintaining their own agencies or in serving the needs of others who had not participated in creating the associations; furthermore, the crisis period did not bring any great revival of farm-loan associations to solve the mortgage-credit problems of a distressed agriculture. Commercial machine farming necessarily meant large expenditures for supplies in addition to purchases for family living. Fertilizer, fuel, tools, twine, fencing, cement, and other equipment and materials had long since become the products of urban industry. Cooperative buying was an inevitable response to the farmers' intensified desire to save on operation costs. Yet this form of cooperation was old enough and so experienced in failures as to have

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bred caution about it among farmers. T h e number of purchasing cooperatives grew only from 275 in 1915 to 898 in 1921. Census statistics showed the number of farmers participating in 1919 to be 329,449 and in 1924 to be 362,745, whereas the dollar volume fell from $84,615,669 to $75,971,169, probably because of reduced farm-purchasing power." Large-scale buying associations to serve local cooperative outlets followed the example set by the Cooperative Grange League Federation Exchange, designed to serve members of the Grange, the Dairymen's League, and the Farm Bureau Federation in New York. Formed in 1920 as an expansion of the New York Grange Exchange, the new company was capitalized at $1,000,000, and after initial financial difficulties caused by the business depression, it established an excellent record of useful service. T h e Missouri Farmers' Association and the Eastern States Farmers' Exchange were independent centralized purchasing agencies created in 1917 and 1918. Seven additional coordinated purchasing organizations were successfully founded from 1920 to 1923; most of these were affiliated with state farmers' associations." However, the American Cooperative Association, organized in 1913 to serve cooperative stores as a central national purchasing agent, was hit hard by the agricultural crisis. Suffering also from poor management, it failed in 1923. In a somewhat different field, great savings were made for citrus producers' associations, federated under the California Fruit Growers' Exchange, through the Fruit Growers' Supply Company which produced its own box materials and bought fertilizers and other supplies for the growers. No integrated movement resulted from the depression to advance cooperative buying as a means of relieving the farmer from disparity between what he sold and what he bought. Farmers felt no sweeping, emotional attachment to purchasing associations; that was reserved for marketing.

• ^

Chapter IV

The Cooperative-Marketing Remedy

With the frontier of free land gone, with values of farm land moving steadily downward, with foreign markets shrinking and urban markets tightening, the direction of improvement for agriculture seemed logically to be toward the marketing system. Typical of this conclusion was the complaint of President C. W. Hunt to the Iowa Farm Bureau convention that the problem of marketing the farmer's products "has been left entirely in the hands of the speculator and gambler with the result that marketing machinery has been built up to fill the pockets of the speculator, the commission merchant, and the money changer, leaving the farmer with a scant living and nothing in his pocket but holes."1 T h e characteristic view was that farmers had to take whatever prices were offered for their produce and pay whatever was demanded for the goods of industry. O. E. Bradfute of the Farm Bureau frequently recalled that when he was a farm boy and rode with his father to market he once asked, "Why is it, father, that we always ask the man how much he will pay us for our farm products and then when we go to the store we always ask the storekeeper how much he wants for his goods?"2 Marketing

Reform

Opportunities

Clear to everyone, farmers and their nonrural friends alike, was the wide discrepancy between prices on the farm and prices on retailers' shelves. Farmers coming to Washington to be heard by

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congressional committees never tired of pointing out the difference between lamb on the farm at about $8 per hundredweight and lamb chops in capitol restaurants at $1.50 for two. T w o illustrations of the producers' marketing problem were widely published. A Fargo, North Dakota, potato farmer shipped four carloads of potatoes to the Minneapolis Potato Exchange. T h e exchange realized $556. Transportation, handling charges, and deductions absorbed $554.50, leaving the farmer $1.50 for his four carloads. A Virginia housewife found pinned to a potato a note from its grower in Michigan, who wrote: "I got twenty-four cents per bushel. What did you give?" T h e buyer had paid. $1.so a bushel." Twentieth-century merchandising had pushed prices of raw and finished goods further apart. Processing and packaging, elaborate advertising and display services, delivery and credit, multiplicity of retail outlets, and transportation from remote sources all involved costs that distributors could justify; and such costs had been rapidly increased after the war, primarily because of higher wage levels. But when prices of raw materials fell, distribution charges did not decline in proportion, and farmers were left with a smaller percentage of the consumers' dollar. For four years the first objective of the Farm Bureau was to improve the farmers' business position, and it lavished vast resources upon efforts to perfect cooperative-marketing associations. Gray Silver in reviewing those years said: "We considered it fundamental that the farmer must be placed on an equitable basis in his commercial relations to other industries. It was plain to us that savings arising from cheapened production and transportation would be inconsequential and uncertain as long as all that might be gained thereby stood to be lost through the farmers' commercial helplessness."4 Proponents of farm relief pointed out an additional burden imposed by the multiplicity of middlemen: the fact that there were four food dealers to every seven farmers. With such a load, more than it seemed possible for agriculture to carry and still remain stable, marketing charges were widely regarded as a cause of the depression. T h e Master of the Oregon Grange denied before a National Grange session that there was any overproduction at all. Such talk was "bunk" and "bugaboo," he declared, because the "real trouble is under-consumption caused by too much spread

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in the price between the producer and consumer."" Agricultural economists G. F. Warren and F. A. Pearson later observed that "the increasing spread between farm and retail prices and the increasing violence in the fluctuation of farm prices were a serious problem even before the World War. With deflation, the maladjustment between farm and retail prices has been the most serious single factor in causing the agricultural depression."9 Emphasis upon a single cause of the farm depression overlooked the extent of agriculture's price decline, which no practical economies in marketing could have balanced. The spread of the marketing gap had outpaced economic investigations, creating a field for conjecture on the farmers' share and opportunities for economy. The Committee on Comparative Credit reported to a Farmers' Union Mass Meeting in April, 1921, that 62 cents of the consumers' dollar represented distribution costs; 20 cents, the committee said, would be a proper charge.7 The Farm Bureau's estimate that the farmer got about a third of the consumer's dollar became standard among farm spokesmen. Loose estimates regarding distribution costs and potential savings for the farmer prompted inquiries into the economics of marketing. T h e Department of Agriculture continued its investigation of marketing to seek improvements and, later, published several conclusions concerning the farmer's share of the food dollar: in the period 1910-1914, it had been 56 cents; during 1921-1924 it was down to 48 cents.8 T h e Joint Commission of Agricultural Inquiry in 1921 made its own investigation of the marketing breach, one of the most comprehensive inquiries made to that time, involving 15,000 questionnaires covering more than 200 commodities and the creation of special trade committees to collect and collate information." T h e commission, though hindered by the absence of authoritative marketing data on which to base proposed reforms, determined that the marketing spread had been growing wider until the public paid more for incidentals than for goods, that the farmer received less as distribution services were elaborated, and that something should be done about it. There appeared to be magnificent opportunities for cooperative marketing to double the farmers' income merely through economies in marketing. Actually, however, there was very little room for farmers to

g8

COOPERATIVE-MARKETING REMEDY

profit by cooperative marketing directed toward economies in distribution, a fact that farmers, enthusiastic about cooperation, failed to grasp. Most of the spread was in service costs, which consumers learned to demand. Except in theory, cooperative marketing could not provide prosperity for farmers by simplifying the process of selling; the price gap not only resisted efforts to narrow it but continued to spread.10 As long as lack of authoritative data encouraged farmers to hope for great gains in marketing efficiency, the cooperative movement was regarded as the prime hope for a better day on the farm. Where marketing economies through cooperative selling were uncertain a vague but entrancing promise was added to the cooperative gospel: that great co-ops could enforce good prices by control of supplies. At the invitation of the Kansas State Board of Agriculture and the American Farm Bureau in the fall of 1920, Bernard Baruch cast his experienced business eye over the agricultural industry. He believed the farmer could recover by organization into powerful marketing associations under intelligent direction. First printed as a letter to the Kansas State Board of Agriculture, the Baruch plan was repeated by its author in a number of addresses to farmers' conventions and widely noticed in the farm press as one of the first definite programs to meet the agricultural crisis.11 Cooperative marketing had passed through its primitive stages and was advancing toward more ambitious goals of price management and larger savings in distribution when the agricultural crisis centered attention upon it as the greatest source of farm relief. T h e number of farmers' grain elevators, livestock-shipping associations, and cooperative creameries was brought to the saturation point. Local cooperatives had begun to federate into larger and more powerful bodies which, in the case of certain commodities, were able to exercise a distinct influence upon the market by grading, making use of market information, and regulating the flow of supplies. Local co-ops had in some instances joined hands to found or cooperate with sales agencies in the terminal markets of grain, livestock, and other commodities. The Equity Cooperative Exchange of St. Paul as a terminal outlet for grain and the Farmers' Union terminal livestock commission agencies were successful examples of a promising expansion of cooperation into the marketing process. State and national councils of farmer coopera-

COOPERATIVE-MARKETING REMEDY

99

tives were in existence in 1920 as publicity and information agencies, but they made little headway toward the integration of cooperatives as effective market-controlling instruments. The Sapiro "Commodity"

Marketing

Plan

From California, Aaron Sapiro brought the rest of the nation a bold new vision of cooperative marketing just in time to meet the crisis-born search of farmers for a quick and easy form of relief. Producers of staple crops had suffered severely from early price declines, but producers of specialty crops in California were relatively well off. Since California producers were organized and able to exercise some control over prices, the conclusion to which farmers jumped was that organization and control made all the difference. Sapiro's message was that farmers could solve their economic problems directly by tight organization and the employment of managerial skill comparable to that employed by private distributing agencies. Political remedies were to be discarded, familiar big-business practices were to be used, distribution of single commodities was to be dominated by powerful centralized associations organized for that specific purpose, and gains in addition to marketing economies were to be returned to the producers by price manipulation. T h e application of ingenuity and intelligence, clean service, and orderly merchandising, and the idea of beating the middleman in the competitive game were attractive incidental aspects of the new scheme of cooperative marketing. T h e most distinctive aspect of this program was control of a commodity from harvest to market. Aaron Sapiro became the preeminent champion of centralized marketing, known variously as the "commodity" marketing system, the Sapiro plan, and the California plan. A graduate of the University of California Law School in 1911, Sapiro was a bright and able young lawyer associated with Colonel Harris Weinstock when the latter became director of California's State Market Commission in 1915. Working together through the commission, Weinstock and Sapiro, with advice from David Lubin, promoted the development of agricultural marketing associations according to principles previously developed in Denmark and California. California provided an abundant frontier for pioneering, and the State Market Commission was a center for exploration of marketing problems. During the years 1916-1918 cooperation was

lOO

COOPERATIVE-MARKETING REMEDY

the State Market Commission's primary program; with its assistance eighteen new cooperative associations were founded on the principle of centralized commodity marketing, leaving lasting marks upon the distribution of California's agricultural produce and setting an example for other areas. Nowhere before 1920 were the tactics of centralized marketing better illustrated than in the management of the raisin producers' association by Wylie Giffin, who did much to perfect the plan in practice." Independently, Sapiro also applied the principles of centralized association and added his own organizing talent to the formation of cooperatives in California, with great immediate success among the egg producers of Petaluma and other specialty-crop farmers. In his early organizational activities, Aaron Sapiro discovered and developed additional assets as powerful as his attractive plans. Sapiro was a spellbinder with a mellifluous voice charged with enthusiasm and sincerity, and with an ability to construct, both directly and by suggestion, an eminently plausible vision of better things to come. He had a fine sense of drama, his appearances were histrionic, and he held his audiences enthralled. Substantial fees for organization services and legal counsel provided Sapiro the impressive trappings of a free-spending big-business operator. Sapiro charged fees as high as $30,000 for organizing large cooperatives and often remained as salaried legal counsel for about $10,000 per year. He had a hand in the organization of more than thirty associations and represented in 1923 about sixty large co-ops. Sapiro's firm had an annual income averaging $150,000 over a period of years, large sums of which were used to maintain offices in Chicago, New York, Dallas, and San Francisco. Despite his constant assurance that employment of expensive experts was essential to the success of cooperatives, the sums he charged for his own services came to be a point of criticism. When Henry Ford's Dearborn Independent, following its anti-Semitic bias, charged Sapiro with swindling the farmers, Sapiro initiated a $1,000,000 libel suit, settled out of court in 1927." He cut a spectacular swath through the cooperative movement in the crisis period, filling farmers with ambitions for market control, and shifting attention from local associations that emphasized economies to the great commodity associations that aspired to manage prices. Sapiro expanded his operations from California to the Pacific

COOPERATIVE-MARKETING REMEDY

lOl

Northwest, where he helped organize big wheat pools, and in 1920 he burst brilliantly upon the national agricultural scene. No individual was more successful than Aaron Sapiro in bringing forth the vision of farmer-controlled marketing and creating enthusiasm for it. He had appeared at the Montgomery meeting of the American Cotton Association in April, 1920, and at the Chicago marketing conference called by the Farm Bureau in July, 1920. In both instances Sapiro had electrified his audiences and had been responsible for the turn these conferences took in the direction of largescale centralized cooperative-marketing associations aspiring to dominate price-making forces. Wherever he went in 1920 and 1921 he found occasion to deliver an audacious address on the subject of "true" cooperative marketing with grand promises of a new economic life for producers. In each case he carefully studied the marketing problems of the audience he would face. Failures of old-style cooperative marketing were contrasted with the logic of his own plan, "cardinal" points of successful cooperation were plainly stated, methods of cooperatives in California were cited frequently as perfection, and a message of brotherhood, justice, equality, a more abundant life for farmers, and the advancement of civilization was a final embellishment. In 1921 in California "9 out of 10" farmers were making money, he said, "when the majority of the farmers of the country are flat broke"; the movement had transformed, he continued, "all of our districts from absolute despair to permanent prosperity—even during this year."" Farmers with stable incomes, Sapiro said, could begin to enjoy the good things of a modern American standard of living. Cooperative marketing meant for rural society "a better manhood and womanhood and better citizenship"; farmers could hold up their heads again as substantial citizens rather than underdogs and the hayseed butt of crude humor." Farm relief was not a matter for political intervention since the "real cause" of the farmer's difficulty was "his methods of doing business." Furthermore, Sapiro's plan would destroy agrarian radicalism; the biggest thing about cooperation "is that it has turned the interest of the average farmer from a wild sort of an indefinite political hankering to some real intelligent attention to the economic phases of his problem."1" Under the spur of Sapiro's driving enthusiasm, producers of one commodity after another came to accept large-scale centralized mar-

102

COOPERATIVE-MARKETING REMEDY

keting associations. Commodity associations blossomed during the years 1920-1923, enrolling memberships, and doing an annual volume of business that exceeded the whole cooperative movement in 1915. In 1923, 65 centrally controlled co-ops had 22

219

city laborer were workers. If many a farmer felt that his proprietorship placed him a cut above the laborer, it was also clear that the farmer's income was hardly more than poor pay for labor. With the vanishing of speculative income from farm ownership, the farmer was more nearly a wage earner than a property owner, and frequently he earned less than his hired hands. Both farmer and labor groups desired a more democratic management of government to equalize its favors. More important were the negative causes for common feeling. A "Call for Action," issued on March 15, 1922, by a progressive political group—the Conference for Progressive Political Action—declared that "the paralysis of America is directly traceable to the conspiracy of bankers and speculators to deflate the farmers, and a similar conspiracy of bankers and employers to crush labor... ."* Rising to opportunities for farmer-labor consolidation were a number of organizations ambitious to extend the political power of the two groups. T h e Farmers' Union courted organized labor and the Farmers' National Council sought to bring about farmer-labor cooperation. The strong railway brotherhoods moved toward farmer-labor political action, and Labor, their weekly newspaper, frequently expressed friendship for farmers. In the issue of July 1, 1922, it declared that "the farmer is in exactly the same position as the city worker. Their interests are sufficiently identical to justify them in getting together, in order that they may successfully resist the aggressions of the common enemy—the parasite who robs producer and consumer alike." In October, 1921, the United Mine Workers in convention had resolved to join with the organized farmers in a new political party, and they asked Samuel Gompers to call a conference of farmer and labor groups to work out a political coalition.4 At its convention of June, 1922, the American Federation of Labor set out to work for an alliance of labor and farm organizations." Through the triangular area with its corners in Wisconsin, Texas, and Washington, the years 1920 to 1923 witnessed increasing cooperation among farmer, labor, and reformist forces. Both nationally and locally, scattered forces were interested in exercising political influence and willing to participate in a national movement. T h e People's Legislative Service and the People's Reconstruction League had tried in a small way to bring some of this combined farmer-labor power to bear upon the federal legislative

220

AGRARIAN REVOLT, I PP- 118-125. 47. FTC, Cooperative Marketing, pp. 326-327; Nourse, Legal Status of Agricultural Cooperation, pp. 100-101; Aaron Sapiro to the author. 48. Asher Hobson, "Farmers' Cooperative Associations," American Economic Review, X I (June, 1921), p. 225. 49. Cong. Rec., 67th Cong., 1st sess., May 4, 1921, pp. 1042, 1044. 50. FTC, Cooperative Marketing, pp. 336-343; Walton H. Hamilton, "Judicial Tolerance of Farmers' Cooperatives," Yale Law Journal, X X X V I I I (May, 1929), pp. 938-939; Nourse, Legal Status of Agricultural Cooperation, pp. 399-422. 51. George J . Waas and Daniel G. White, Application of the Federal Income Tax Statutes to Farmers' Cooperatives, USDA, Farm Credit Administration Bulletin 53 (November, 1942), p. 10. 52. Federal Reserve Bulletin, IX (January, 1923), p. 19; FTC, Cooperative Marketing, pp. 278-280. 53. U.S. War Finance Corporation, Sixth Annual Report, 1923, p. 4. 54. War Finance Corporation, Circular No. 5. Information for Cooperative Associations of Producers Applying for Advances under Section 24 of the War Finance Corporation Act (October 1, 1921), pp. 2-3. 5 5 . 0 . B. Jesness, Cooperative Marketing, USDA, Farmers' Bulletin 1144 (September, 1920), 27 pp. 56. USDA, Weekly News Letter, VII (December 1, 1920), p. 2; VIII (July 27, 1921), p. 8; USDA, BAE, Agricultural Cooperation, I (January 2, 1923).

NOTES

3H

57. H. C. Wallace, "The Year in Agriculture," USD A, Yearbook, 1923, pp. 35-37. 58. H. C. Wallace, manuscript of address to the National Council of Farmers' Cooperative Marketing Associations, February 8, 1924, Files of the Secretary of Agriculture. Notes to Chapter V Pages

118-151

1. New York Times, December 21, 1920, p. 3. 2.T. C. Atkeson testimony, House, Committee on Banking and Currency, Farm Organizations, Hearings, 66th Cong., 3d sess., p. 61; Patrons of Husbandry, Proceedings, National Grange, November, 1921, p. 37. See also Warren G. Harding, "My Plan to Help the Farmers," Farm Journal, XLIV (December, 1920), p. 7. 3. Cong. Rec., 66th Cong., 3d sess., March 4, 1921, p. 4534. 4. New York Times, March 19, 1921, p. 1. 5. Cong. Rec., 67th Cong., 1st sess., April 12, 1921, p. 170. 6. Republican Campaign Textbook, 1920, p. 48. 7. Cong. Rec., 67th Cong., 2d sess., December 6, 1921, p. 54. 8. National Agricultural Conference, Report, pp. 6-7, 8-11. 9. Russell Lord, The Wallaces of Iowa (Boston: Houghton Mifflin, 1947), p. 169. 10. H. C. Wallace to J. R. Howard, March 14, 1921, Files of the Secretary of Agriculture. 11. Files of the Secretary of Agriculture; USDA, Weekly News Letter, April 13, 1921, p. 1. 12. Wallaces' Farmer, October 31, 1924, p. 8. 13. H. C. Wallace address to Farmers' Grain Marketing Committee of Seventeen, April 6, 1921, USDA press release, USDA Library. 14. USDA, BAE, "Agricultural Economics" (June, 1922), p. 81, USDA Library. 15. House, Committee on Banking and Currency, Farm Organizations, Hearings, 66th Cong., 3d sess., pp. 92-102. 16. C. W. Pugsley, The Relation of Agricultural Education to Farm Organizations, USDA, Misc. Circular 3 (January 31, 1923), pp. 10, 14-16. See also Kile, The Farm Bureau Movement, pp. 217-219, and William A. Lloyd, County Agricultural Agent Work under the Smith-Lever Act, 1914-1924, USDA, Misc. Circular 59 (May, 1926), p. 15. 17. H. C. Wallace, "Relation of Federal Cooperative Extension Employees to Agricultural Organizations," August 25, 1922, Henry C. Wallace, "Addresses and Statements," USDA Library. 18. Henry C. Taylor, "A Farm Economist in Washington, 1919-1925," pp. 102-155, unpublished manuscript, Henry C. Taylor papers, Wisconsin State Historical Society. 19. USDA, Yearbook, 1920, p. 84. 20. Burton L. French to the author. 21 H. C. Wallace to John P. Wallace, February 7, 1923, Files of the Secretary of Agriculture. 22. H. C. Wallace to T. L. Galpin, January 20, 1922, Files of the Secretary of Agriculture. 23. Country Gentleman, LXXXVII (March 25, 1922), p. 16. 24. William Johnson, "Figures Do Lie; The Department of Agriculture's Gloomy Outpourings Are Sharply Challenged," Country Gentleman, LXXXVIII (April 21, 1923), pp. 3-4, 18. 25. George F. Warren and Frank A. Pearson, The Agricultural Situation; Economic Effects of Fluctuating Prices (New York: John Wiley, 1924), p. 233. 26. Gray Silver to Herbert Hoover, April 24, 1923; Herbert Hoover to Gray Silver, April 26, 1923, Hoover Archives. 27. "Letter to Representative of National Farm Organization, relative to Country Gentleman article," Wallace statement May 3, 1923, H. C. Wallace, "Addresses and Statements," USDA Library. See also A.F.B.F., Weekly News Letter, May 24, 1923.

NOTES

3!5

28. Henry A. Wallace, William A. Schoenfeld, Donald R. Murphy to the author; Henry C. Taylor, "Henry C. Wallace and the Farmers' Fight for the Right," unpublished manuscript, 14 pp., Henry C. Taylor Papers. 29. Henry C. Wallace, Our Debt and Duty to the Farmer (New York: Century, 1925), pp. 17, 96. 30. USDA, Yearbook, 1924, p. 2. 31. U.S. Secretary of Agriculture, Annual Report, 1919, p. 26. See also Henry C. Taylor, "The Work of the Office of Farm Management and its Relation to the Agricultural Experiment Stations," Journal of Farm Economics, II (January, 1920), p. 46; H. C. Taylor, Story of Agricultural Economics, p. 422. 32. USDA, Report of Committee Appointed by the Secretary of Agriculture to Consider Plan of Organization, Scope of Work, and Projects for the Office of Farm Management, and Methods of Procedure in Making Cost of Production Studies, USDA, Office of the Secretary, Circular 132 (March, 1919), 15 pp. 33. H. C. Taylor, "A Farm Economist in Washington," p. 22. 34. Ibid., p. 1. 35. H. C. Taylor, "The Work of the Office of Farm Management," Journal of Farm Economics, II, p. 55. 36. Andrew Boss, "Forty Years of Farm Cost Accounting Records," Journal of Farm Economics, X X V I I (February, 1945), p. 12. 37. U.S. Congress, House, Committee on Agriculture, Agriculture Appropriation Bill, 1921, Hearings, 66th Cong., 2d sess. (1920), p. 45. 38. F. W. Peck, "The Cost of a Bushel of Wheat," USDA, Yearbook, 1920, p. 301; Merrill K. Bennett, Farm Cost Studies in the United States: Their Development, Applications, and Limitations (Stanford University Press, 1928), p. 10. 39. Country Gentleman, January 17, 1920, p. 74; Farmers' Union press release, November 3, 1920, USDA Library. 40. Theodore Macklin, "Report of Committee on Farm Economic Investigational Work, The American Farm Economic Association," Journal of Farm Economics, III (January, 1921), p. 41. 41. Henry C. Wallace, "The Agricultural Colleges in the Future," commencement address, Massachusetts Agricultural College, June 10, 1921, H. C. Wallace, "Addresses and Statements," USDA Library. 42. H. W. Moorhouse, Director of the Research Department, report to the Farm Bureau convention, December 13, 1922, A.F.B.F., Fourth Annual Convention, 1922, pp. 73-75; A.F.B.F., Weekly News Letter, April 6, 1921; May 18, 1922; May 24, 1923. 43. H. C. Taylor, "A Farm Economist in Washington," p. 40. A manuscript history of the origins of the Bureau of Agricultural Economics was prepared in January, 1924, by the bureau, copy in Files of the Bureau of Agricultural Economics. Henry C. Taylor in his last annual report as Chief of the Office of Farm Management and Farm Economics included much historical material on the development of economic study in the Department of Agriculture, USDA, Annual Reports, 1922, pp. 505, 545-546. See also H. C. Taylor, Story of Agricultural Economics, pp. 602-604. 44. Henry C. Taylor to the author; H. C. Wallace, "The Year in Agriculture," USDA, Yearbook, 1921, p. 16. 45.A.F.B.F., Weekly News Letter, December 1, 1921; USDA, Weekly News Letter, August 31, 1921, p. 6. 46. H. C. Wallace, "The Year in Agriculture," USDA, Yearbook, 1922, p. 15. See also Report, Chief of the Bureau of Agricultural Economics, in USDA, Annual Reports, 1923, pp. 136-137; Alfred C. True, A History of Agricultural Experimentation and Research in the United States, 1607-192; (Washington: 1937), pp. 270-272; Joint Commission of Agricultural Inquiry, Report, IV, Marketing and Distribution, pp. 232-262, Chapter XI, "Marketing and Related Activities in the Bureau of Agricultural Economics of the United States Department of Agriculture," prepared by the Department of Agriculture. 47. Henry C. Taylor, manuscript address, National Association of State Marketing

3i6

NOTES

Officials, November 29, 1921, Files of the Bureau of Agricultural Economics; USDA, BAE, Report of the Chief of the Bureau of Agricultural Economics, 1924, p. 2. 48. Henry C. Wallace, "The Agricultural Depression and What Has Been Done to Meet it," address, Washington Court House, Ohio, October 18, 1922, H. C. Wallace, "Addresses and Statements," USDA Library. 49. Joint Commission of Agricultural Inquiry, Hearings, I, p. 625; Joint Commission of Agricultural Inquiry, Report, I, The Agricultural Crisis, p. 11. 50. National Agricultural Conference, Report, pp. 10-11. 51. A.F.B.F., Fourth Annual Convention, 1922, pp. 120-121. 52. Henry C. Taylor, "Uncle Sam and the Farmer," The American Scholar, X X I I I (Autumn, 1954), pp. 434, 448. 53. USDA, Yearbook, 1924, p. 29. 54. Henry C. Taylor, annual report of the Chief of the Bureau of Agricultural Economics, USDA, Annual Reports, 1923, p. 132; Henry C. Taylor to the author. See also Henry C. Taylor, "Agricultural Forecasting," Journal of Farm Economics, VI (April, 1924), p. 163; and an explanation of the department's policy by Assistant Secretary C. W. Pugsley to the American Farm Bureau, A.F.B.F., Fourth Annual Convention, 1922, p. 107. 55. Henry C. Taylor to the author; H. C. Taylor, "A Farm Economist in Washington," pp. 99-100. 56. William A. Schoenfeld and Henry C. Taylor to the author. See also H. C. Taylor, annual report of the Chief of the Bureau of Agricultural Economics, USDA, Annual Reports, 1923, p. 133; H. C. Taylor, Story of Agricultural Economics, pp. 449-451; H. R. Tolley, "The History and Objectives of Outlook Work," Journal of Farm Economics, X I I I (October, 1931), pp. 523-534. 57. USDA, BAE, "The Agricultural Outlook, April, 1923," mimeographed, Records of the Bureau of Agricultural Economics. See also New York Times, April 22, 1923, p. 20. Congressional hearings reviewed the work of the outlook program and reprinted the text of the April report; U.S. Congress, House, Committee on Agriculture, Swank Cotton Crop Reports Bill, Hearings, 68th Cong., ist sess. (1924), pp. 31-43. See also USDA, BAE, "Summary of statistics of agricultural exports and imports to be considered in adjusting agricultural production to foreign demand, April, 1923," mimeographed, Records of the Bureau of Agricultural Economics. 58. USDA, BAE, "The Agricultural Outlook, July, 1923," mimeographed, Records of the Bureau of Agricultural Economics. See also USDA, Agricultural Situation, III (August 1, 1923), pp. 14-16; USDA, Official Record, II (July 18, 1923), pp. 1-2. 59. Senate, Committee on Agriculture and Forestry, Grain Futures, Hearings, 67th Cong., 2d sess., pp. 39-42. 60. J . S. Wannamaker, President of the American Cotton Association, circular letter reprinted in House, Committee on Agriculture, Swank Cotton Crop Reports Bill, Hearings, 68th Cong., ist sess., p. 8. 61. U.S. Congress, Senate, Committee on Agriculture and Forestry, Purchase and Sale of Farm Products, Hearings, 68th Cong., ist sess. (1924), p. 163. 62. House, Committee on Agriculture, Swank Cotton Crop Reports Bill, Hearings, 68th Cong., ist sess., pp. 17-20. 63. Henry C. Taylor, "The Agricultural Situation and the Means of Setting it Right," 5 pp. memorandum to H. C. Wallace, September 22, 1923, Henry C. Taylor Papers. See also H. C. Taylor, Story of Agricultural Economics, pp. 591-594. 64. H. C. Wallace, "The Year in Agriculture," USDA, Yearbook, 1923, p. 21. 65. John D. Black, Agricultural Reform in the United States (New York: McGrawHill, 1929), p. 334; USDA, Outlook Work: The First 20 Years (1942), p. 8. 66. H. R. Tolley, Philosophy of Agricultural Adjustment, Oregon State College Cooperative Extension Service (December, 1935), mimeographed, p. 9. 67. Herbert Hoover to Arthur Capper, March, 1921, Arthur Capper Papers, Topeka, Kansas; Herbert Hoover, The Memoirs of Herbert Hoover, II, The Cabinet and the Presidency, 1920-1933 (New York: Macmillan, 1952), pp. 36, 41, 109.

NOTES 68. Herbert Hoover, "Some Notes on Agricultural Readjustment, and the High Cost of Living," Saturday Evening Post, CXCII (April 10, 1920), p p . 17-18, 54-56; Herbert Hoover, "Farmers' Problems," address before the Kansas State Board of Agriculture, October 14, 1920, Kansas State Board of Agriculture, Twenty-second Biennial Report, 1919 and 1920, p p . 3-18; Herbert Hoover letter to the 15th International Farm Congress, December 9, 1920, New York Times, December 10, 1920, p. 32. 69. U.S. Secretary of Commerce, Tenth Annual Report, 1922, p. 5. 70. U.S. Bureau of Foreign and Domestic Commerce, Director, Annual Report to the Secretary of Commerce for the Fiscal Year Ended June 30, 1922, p. 4. 71. Herbert Hoover to H. C. Wallace, February 8, 1922; March 7, 1922, Hoover Archives. 72. Herbert Hoover to H . C. Wallace, October 3, 1923; H . C. Wallace to Herbert Hoover, October 11, 1923, Hoover Archives. 73. H . C. Wallace to W. F. Brown, January 16, 1923, Files of the Secretary of Agriculture. 74. H . C. Wallace to W. G. Harding, August 8, 1921, Files of the Secretary of Agriculture. 75. Herbert Hoover memorandum to W. F. Brown, October 20, 1921, copy in Files of the Secretary of Agriculture. T h e memorandum is reprinted in U.S. Congress, Senate, Committee on Agriculture and Forestry, Federal Cooperative Marketing Board, Hearings, 68th Cong., 2d sess. (1925), p. 162. 76. Herbert Hoover to W. F. Brown, October 20, 1921, copy in Files of the Secretary of Agriculture. 77. Herbert Hoover to Howard M. Gore, November 24, 1924, Files of the Secretary of Agriculture; W. F. Brown to Herbert Hoover, July 19, 1924, copy in the Calvin Coolidge Papers, Library of Congress. 78. H . C. Wallace to R. A. Cowles, Secretary, American Council of Agriculture, October 4, 1924, Files of the Secretary of Agriculture. 79. E. H. Rettig to W. G. Harding, January 16, 1922, Files of the Secretary of Agriculture. See also J . Clyde Marquis, "New Laws for Old; Credit Is the Livest Farm Issue in Congress," Country Gentlemen, LXXXVII (January 28, 1922), p. 26. 80. American Fruit Grower, April, 1922, p. 7. See also American Agriculturist, March 8, 1924, p. 244. 81. A.F.B.F., "Annual Administrative Reports," USD A, Library. 82. H. C. Wallace to W. F. Brown, January 16, 1923, Files of the Secretary of Agriculture. 83. U.S. Congress, Senate, Reorganization of the Executive Departments, S. Doc. 302, 67th Cong., 4th sess. (February 13, 1923), p. iii. 84. U.S. Congress, Joint Committee on Reorganization of the Administrative Branch of the Government, Reorganization of Executive Departments, Hearings, 68th Cong., ist sess. (1924), pp. 349~35385. Charles J . Brand, " T h e Vital Concern of Agriculture in Foreign T r a d e , " Annals of the American Academy of Political and Social Science, LXXXIII (May, 1 1 9 9)> PP- 35~47; USDA, Weekly News Letter, J u n e 16, 1920, p. 3. 86. Cong. Ree., 66th Cong., 3d sess., February 23, 1921, p p . 3674-3678. See also U.S. Congress, House, Committee on Agriculture, Future Trading, Hearings, 66th Cong., 3d sess. (1921), pp. 89-90. 87. H. C. Wallace address before the Farmers' Grain Marketing Committee of Seventeen, Chicago, April 6, 1921, H . C. Wallace, "Addresses and Statements," USDA Library. See also H. C. Wallace, " T h e Year in Agriculture," USDA, Yearbook, 192j, p. 20. 88. George Livingston memorandum to H . C. Wallace, March 12, 1921, and Leon M. Estabrook memorandum to H. C. Wallace, March 14, 1922, Records of the Bureau of Agricultural Economics. 89. Joint Commission of Agricultural Inquiry, Report, I, The Agricultural Crisis, pp. 11, 22-23; A.F.B.F., "Annual Report of the Secretary, January 1, 1921 to No-

3

NOTES

i8

vember 1, 1921," USDA Library; National Agricultural Conference, Report, pp. 148, 168-169, 1 ®5 90. U.S. Congress, House, Committee on Appropriations, Subcommittee, Second Deficiency Appropriation Bill, Hearings, 67th Cong., ist sess., (1921), pp. 470-471. 91. H. C. Wallace to Herbert Hoover, July 14, 1921, Hoover Archives. 92. [H. C. Taylor], "Conference Held in the Office of Dr. H. C. Taylor, Chief of the Bureau of Markets and Crop Estimates, July 21, 1921," typewritten stenographic report, 33 pp., USDA Library. 93. U.S. Bureau of Foreign and Domestic Commerce, Director, Annual Report for the Fiscal Year ending June 30, 1922, pp. 46-49. 94. U.S. Department of Commerce, Report to the President's Agricultural Conference; Activities of the Department Which are of Service to the Agricultural Industry (1925), p. 2. 95. Deficiency Appropriations Act, March 3, 1923, 67 i/.S. Stat. L. 1536. See also President Harding's message to Congress, February 15, 1923, H. Doc. 578, 67th Cong., 4th sess. 96. New York Times, March 13, 1923, p. 3. See also Department of Commerce, Report to the President's Agricultural Conference (1925), pp. 16-17; Cong. Ree., 68th Cong., ist sess., April 15, 1924, p. 6428. 97. C. J . Brand to Chester Morrill, April 18, 1923, Files of the Secretary of Agriculture. 98. Secretary of Commerce, Eleventh Annual Report, 1923, p. 35. See also Department of Commerce press release in Northwestern Miller, June 27, 1923, p. 1385. 99. C. A. Herter memorandum to Julius Klein, October 23, 1923, Hoover Archives. 100. Testimony of Herbert Hoover and Julius Klein, U.S. Congress, House, Committee on Interstate and Foreign Commerce, To Establish in the Bureau of Foreign and Domestic Commerce of the Department of Commerce, a Foreign Commerce Service of the United States, Hearings, 68th Cong., ist sess. (1924), pp. 7, 40, 107-113. 101. H. C. Taylor to H. C. Wallace, April 19, 1924, Files of the Secretary of Agriculture. 102. H. C. Wallace to C. V. Gregory, Editor, Prairie Farmer, February 15, 1924; H. C. Wallace to C. N. Haugen, Chairman, House Committee on Agriculture, February 23, 1924, Files of the Secretary of Agriculture. See also Cong. Ree., 68th Cong., ist sess., April 16, 1924, p. 6479; H. Rept. 248, 68th Cong., ist sess. 103. [USDA], "Relative Functions of the Departments of Agriculture and Commerce," [1924], 25 pp., mimeographed, Files of the Secretary of Agriculture; L. G. Michael to Howard M. Gore, January 8, 1925, Files of the Secretary of Agriculture. 104. Cong. Ree., 68th Cong., ist sess., April 5, 1924, pp. 5705-5708. 105. H. C. Wallace to Representative M. W. Shreve, May 3, 1924, Files of the Secretary of Agriculture. 106. [USDA], "Encroachment of the Department of Commerce Upon the Department of Agriculture in Marketing and Agricultural Economic Investigations, " 23 pp., undated mimeographed memorandum [summer, 1924], Calvin Coolidge Papers. 107. J. N. Tincher to C. Bascom Slemp, February 20, 1924; Herbert Hoover to C. Bascom Slemp, February 25, 1924, Calvin Coolidge Papers; L. G. Michael to Howard M. Gore, January 8, 1925, Files of the Secretary of Agriculture. Notes to Chapter Pages

VI

152-188

1. House, Committee on Banking and Currency, Farm Organizations, Hearings, 66th Cong., 3d sess.; 67th Cong, ist sess., 344 pp. 2. Patrons of Husbandry, Proceedings, National Grange, November, 1922, p. 18; A.F.B.F., Weekly News Letter, June 16, 1921; Charles S. Barrett, Uncle Reuben in Washington (Washington: Farmers' National Publishing Co., 1923), p. 15.

NOTES

3*9

3. J . G. Brown to H. C. Wallace, March 22, 1921, Files of the Secretary of Agriculture. 4. J . Clyde Marquis, "Congress Tries Again; Five Serious Farming Questions Demand Its Attention," Country Gentleman, L X X X V I (May 21, 1921), p. 26. See also Orange Judd Farmer, April 30, 1921, p. 503. 5. A.F.B.F., National Legislative Policy, 1921, 7 pp. 6. La Follette's Magazine, XIII (May, 1921), p. 66; B. C. Marsh testimony, Joint Commission of Agricultural Inquiry, Hearings, I, p. 522; New York Times, April 15, 1921, p. 6; April 16, 1921, p. 8. See also testimony of J . S. Williams, Joint Commission of Agricultural Inquiry, Hearings, II, pp. 22-31. 7. Farmers' Educational and Cooperative Union, Proceedings of Mass Meeting, April, 1921, p. 35. See also Cong. Ree., 67th Cong., ist sess., June 23, 1921, p. 2963. 8. Wallaces' Farmer, July 1, 1921, p. 10. 9. Chester Morrill to W. A. Jump, May 10, 1921, Records of the Bureau of Agricultural Economics; Minutes of the meeting of May 9, 1921, quoted in Alice M. Christensen, "Agricultural Pressure and Government Response in the United States: 1919-1929," pp. 59-61, unpublished doctoral dissertation, University of California, 1936. Hereafter cited as A. Chistensen, "Agricultural Pressure." See also O. M. Kile, The Farm Bureau Movement, p. 188; Arthur Capper, The Agricultural Bloc (New York: Harcourt, Brace, 1922), pp. 9-10, 141. 10. Burton L. French to the author. See also Sydney Anderson, "The Latest Thing in Blocs," Country Gentleman, L X X X V I (December 31, 1921), p. 3; A. Capper, Agricultural Bloc, p. 12. 1 1 . Files of the Secretary of Agriculture. 12. Frank W. Taussig, "The Tariff Act of 1922," Quarterly Journal of Economics, X X X V I I (November, 1922), pp. 3-4; B. H. Hibbard, Marketing Agricultural Products, pp. 280-281. 13. U.S. Tariff Commission, Operation of Rates in the Emergency Tariff Act, S. Doc. 224, 67th Cong., 2d sess. (1922), p. 1. See also Cong. Ree., 67th Cong., ist sess.. May 5, 1921, p. 1071. 14. Tariff Commission, Operation of Rates in the Emergency Tariff, pp. 1, 99. 15. Farmers' Union Press Release, May 24, 1921, USDA Library. See also C. S. Barrett testimony, U.S. Congress, Senate, Committee on Agriculture and Forestry, Joint Commission of Agricultural Inqury, Hearing, 67th Cong., ist sess. (1921), p. 19; C. S. Barrett, Uncle Reuben in Washington, pp. 126-127; Farmers' Union, Proceedings of Mass Meeting, April, 1921, pp. 4, 20-21. 16. U.S. Congress, House, Committee on Banking and Currency, Amendment to the Farm Loan Act, Hearings, 67th Cong., ist sess. (1921), p. 15. 17. John K. Barnes, "The Man Who Runs the Farm Bloc," World's Work, XLV (November, 1922), p. 51. 18. Cong. Ree., 67th Cong., ist sess., July 5, 1921, pp. 3329-3341. 19. J . K. Barnes, World's Work, (November, 1922), p. 51; New York Times, July 27, 1921, p. 1. 20. Smith W. Brookhart testimony, Joint Commission of Agricultural Inquiry, Hearings, I, p. 10. 21. S. Rept. 212, 67th Cong., ist sess. (July 8, 1921), p. 4. 22. Carl Vrooman to the author; U.S. Congress, Senate, Committee on Agriculture and Forestry, Farmers? Export Financing Corporation, Hearings, 67th Cong., ist sess. (1921), p. 3. 23. Ibid. See also testimony of Carl Vrooman, Joint Commission of Agricultural Inquiry, Hearings, I, p. 454. 24. S. Rept. 192, 67th Cong., ist sess. (June 30, 1921). 25. Senate, Committee on Agriculture and Forestry, Farmers' Export Financing Corporation, Hearings, 67th Cong., ist sess., pp. 22, 37 ff. 26. Files of the Senate Committee on Agriculture and Forestry, Legislative Records Division, The National Archives.

320

NOTES

27. E. W. Ball memorandum to H. C. Wallace, June 21, 1921, Files of the Secretary of Agriculture. 28. Herbert Hoover testimony, Senate, Committee on Agriculture and Forestry, Farmers' Export Financing Corporation, Hearings, 67th Cong., ist sess., pp. 67-85. 29. Herbert Hoover to Arthur Capper, July 23, 1921, Hoover Archives; U.S. Secretary of Commerce, Annual Report, 1921, p. 5. See also Alfred Lief, Democracy's Norris: The Biography of a Lonely Crusade (New York: Stackpole Sons, 1939), pp. 230, 324. 30. U.S. War Finance Corporation, Liquidation of the War Finance Corporation, 78th Cong., ist sess., H. Doc. 55 (1943), p. 13; Woodbury Willoughby, The Capital Issues Committee and the War Finance Corporation (Johns Hopkins University Press, 1934), p. 120. See also Eugene Meyer, Jr., "Financing Agriculture," Kansas State Board of Agriculture, Twenty-third Biennial Report, 1921 and 1922, pp. 23, 3431. Eugene Meyer to the author. 32. W. E. Edge to Eugene Meyer, July 20, 1921, Hoover Archives. 33. Cong. Ree., 67th Cong., ist sess., July 26, 1921, pp. 4298-4299. 34. Herbert Hoover to W. G. Harding, August 18, 1921, Hoover Archives. See also U.S. Congress, House, Committee on Banking and Currency, War Finance Corporation, Hearings, 67th Cong., ist sess. (1921), pp. 20 ff. 35. Cong. Ree., 67th Cong., ist sess., July 26, 1921, p. 4288; July 28, 1921, p. 4378; New York Times, July 28, 1921, p. 5. See also William Allen White, A Puritan in Babylon; The Story of Calvin Coolidge (New York: Macmillan, 1938), p. 237; A. Lief, Democracy's Norris, pp. 231-232. 36. Cong. Ree., 67th Cong., ist sess., July 28, 1921, pp. 4375-4392. 37. H. C. Wallace, " T h e Year in Agriculture," USDA, Yearbook, 1921, p. 48. 38. National Board of Farm Organizations, "Resolutions Adopted, October 31November 2, 1921," mimeographed press release, USDA Library; Cooperative Manager and Farmer, December, 1921, p. 29. 39. Cong. Ree., 67th Cong., ist sess., October 25, 1921, p. 6739; October 6, 1921, p. 6067; October n , 1921, pp. 6230-6231. 40. Ibid., November 17, 1921, pp. 7861, 7884. 41. H. C. Wallace, " T h e Year in Agriculture," USDA, Yearbook, 1921, p. 14; H. C. Wallace, Our Debt and Duty to the Farmer, p. 102. 42. Cong. Ree., 67th Cong., 2d sess., December 6, 1921, p. 52. 43. Peter Norbeck to B. B. Haugen, July 11, 1922, Peter Norbeck Papers, University of South Dakota Library. 44. S. Anderson, Country Gentleman, L X X X V I (December 31, 1921), pp. 3-4. See also Cong. Ree., 67th Cong., 2d sess., December 20, 1921, pp. 582-586; A. Capper, Agricultural Bloc, pp. 3-6. 45. A.F.B.F., Weekly News Letter, January 5, 1922. 46. Cong. Ree., 67th Cong., 2d sess., December 6, 1921, pp. 52-54. 47. Senate Concurrent Resolution 4; Joint Commission of Agricultural Inquiry, Hearings, I, p. 3. 48. A.F.B.F., Weekly News Letter, June 30, 1921; July 7, 1921; Joint Commission of Agricultural Inquiry, Hearings, I, pp. 256-267. See also House, Committee on Banking and Currency, Farm Organizations, Hearings, 67th Cong., ist sess., pp. 155-157. 49. Joint Commission of Agricultural Inquiry, press release, April 16, 1922, Files of the Secretary of Agriculture. See also Sydney Anderson, "Work of the Commission on Agricultural Inquiry," Minnesota Horticulturist, L (April, 1922), p. 122. 50. H. C. Wallace to bureau chiefs, June 17, 1921, Files of the Secretary of Agriculture; H. C. Wallace, " T h e Year in Agriculture," USDA, Yearbook, 1921, p. 15. 51. Joint Commission of Agricultural Inquiry, Report, I, The Agricultural Crisis, pp. 10-11. 52. Compare Joint Commission of Agricultural Inquiry, Report, I, pp. 48-57 and W. I. King, et al., Income in the United States, I, pp. 40-64.

NOTES

321

53. Joint Commission of Agricultural Inquiry, Report, II, Credit, pp. 8 - 1 1 , 147, 149-150. 54. Ibid., IV, Marketing and Distribution, p. 1. 55. Ibid., pp. 4-5; S. Anderson, "Work of the Commission on Agricultural Inquiry," Minnesota Horticulturist, L (April, June, 1922), pp. 116-122, 174-180. 56. Joint Commission of Agricultural Inquiry, Report, IV, Marketing and Distribution, p. 8. 57. Ibid., II, Credit, pp. 9 - 1 1 . 58. Gray Silver, Annual Report, Washington Office of American Farm Bureau Federation, 1923, p. 3. See also testimony of Milo D. Campbell, Joint Commission of Agricultural Inquiry, Hearings, III, pp. 309-331. 59. Cong. Ree., 67th Cong., 2d sess., February 8,1922, p. 2282; U. S. Statutes at Large, XLII, p. 388. 60. Herbert Hoover to Senator Irving Lenroot, March 3, 1922, Hoover Archives. 61. U.S. Department of the Treasury, Annual Report of the Secretary of the Treasury for the Fiscal Year Ended June 30, 1922, p. 39. 62. H. C. Wallace, "The Year in Agriculture," USDA, Yearbook, 1922, p. 41; H. C. Wallace, "The Wheat Situation," USDA, Yearbook, 1923, p. 120; House, Committee on Appropriations, Subcommittee, Agricultural Appropriation Bill, 1924, Hearing, 67th Cong., 4th sess., pp. 507-508. 63. Report of the Committee on Cooperation to the Farmers' Union Convention, Farmers' Union, Minutes, November, 1921, p. 6i. 64. W. P. G. Harding, The Formative Period of the Federal Reserve System During the World Crisis (Boston: Houghton Mifflin, 1925), pp. 238-239; Cong. Ree., 67th Cong., 2d sess., January 17, 1922, p. 1242. 65. Cong. Ree., 67th Cong., 2d sess., January 16, 1922, p. 1195. 66. A.F.B.F., Report of the Muscle Shoals Committee of the American Farm Bureau Federation (May 31, 1921), 36 pp., copy in Calvin Coolidge Papers; A.F.B.F., Weekly News Letter, May 19, 1921. 67. Orville M. Kile, The Farm Bureau through Three Decades (Baltimore: Waverly Press, 1948), p. 105; U.S. Congress, House, Committee on Military Affairs, Muscle Shoals Propositions, Hearings, 67th Cong., 2d sess. (1922), p. 589. 68. For the text of the Ford offer see Cong. Ree., 67th Cong., ist sess., July 25, 1921, pp. 4285-4286. 69. Reynold M. Wik, "Henry Ford and the Agricultural Depression of 1920-1923," Agricultural History, X X I X (January, 1955), pp. 15-22. 70. Outlook, C X X X , February 8, 1922, p. 212. 71. H. Rept. 1084, 67th Cong., 2d sess. (June 9, 1922), Parts 1 and 2, 57 pp., 12 pp. 72. S. Rept. 831, 67th Cong., 2d sess. (July 20, 1922), Part 1, 36 pp. See also Richard L. Neuberger and Stephen B. Kahn, Integrity, The Life of George W. Norris (New York: Vanguard, 1937), p. 206; U.S. Congress, Senate, Committee on Agriculture and Forestry, Muscle Shoals, Hearings, 67th Cong., 2d sess. (1922), 949 pp.; George W. Norris, "Mr. Ford and Muscle Shoals," Brotherhood of Locomotive Engineers Journal, LVI (August, 1922), p. 580. 73. U.S. Congress, Senate, Committee on the Judiciary, Lobby Investigations, Hearings, 71st Cong., ist sess. (1929-1931), Part 7, pp. 2819 ff. 74. U.S. Congress, Senate, Committee on Commerce, and House, Committee on the Merchant Marine and Fisheries, To Amend Merchant Marine Act of 1920, Joint Hearings, 67th Cong., 2d sess. (1922), I, p. 5. 75. Country Gentleman, L X X X V I I I (March 3, 1923), p. 14. 76. A.F.B.F., Weekly News Letter, April 27, 1922; Cong. Ree., 67th Cong., 2d sess., June 13, 1922, pp. 8674-8675. 77. Wallaces' Farmer, July 14, 1922, p. 7. 78. Senate, Committee on Commerce, and House, Committee on the Merchant Marine and Fisheries, To Amend Merchant Marine Act of 1920, Joint Hearings, 67th Cong., 2d sess., pp. 1572-1614.

322

NOTES

79. Cong. Ree., 67th Cong., 2d sess., May 9, 1922, p. 6571; J u n e s i , 1922, p. 9108. 80. A.F.B.F., Weekly News Letter, April 7, 1921. Si. Ibid., January 12, 1922. 82. U.S. Congress, Senate, Report of the International Joint Commission Concerning the Improvement of the St. Lawrence River between Montreal and Lake Ontario for Navigation and Power, S. Doc. 114, 67th Cong., 2d sess. (1921), 184 p p . 83. Burton L. French to the author; A.F.B.F., Weekly News Letter, March 2, 1922. 84. U.S. Congress, Senate, Committee on Interstate Commerce, Truth in Fabric, Hearing, 67th Cong., ist sess. (1921), 507 pp.; U.S. Congress, House, Committee on Interstate and Foreign Commerce, Truth in Fabrics and Merchandise Misbranding Bills, Hearings, 68th Cong., ist sess. (1924), 473 pp.; A.F.B.F., Weekly News Letter, April 13, 1922. 85. U.S. Congress, House, Committee on Agriculture, Filled Milk, Hearings, 67th Cong., ist sess. (1921), 188 pp.; Milo Campbell address to First National Cooperative Marketing Conference, National Council of Farmers' Cooperative Marketing Associations, "Proceedings, December 14, 15, 16, 1922," p. 125, typewritten copy in USDA l i b r a r y . See also National Board of Farm Organizations, Resolutions Adopted, October ji-November 2,1921, p. 4. 86. Patrons of Husbandry, Proceedings, National Grange, November, ip23, p. 19. 87. Cong. Ree., 67th Cong., 2d sess., January 17, 1922, p. 1245. 88. Wallaces' Farmer, February 24, 1922, p. 8; J. C. Marquis, Country Gentleman, LXXXVII (January 28, 1922), p. 26; Iowa Homestead, February 23, 1922, p p . 14-15. 89. [Roland A. White], Milo Reno, Farmers' Union Pioneer (Iowa City: Athens Press, 1941), pp. 44-45, 196. 90. Donald R . Murphy, "Is t h e Greenback Movement Coming Back?" Wallaces' Farmer, March 31, 1922, p. 3. 91. Farmers' Union, Proceedings of Mass Meeting, April, 1921, p. 29. 92. Irving Fisher, Stabilizing the Dollar (New York: Macmillan, 1920), 305 p p . 93. U.S. Congress, House, Committee on Banking and Currency, Stabilization of Purchasing Power of Money, Hearings, 67th Cong., 4th sess. (1923), 164 p p . g4- T h o m a s A. Edison, A Proposed Amendment to the Federal Reserve Banking System, Plan and Notes (Orange, N. J . [1923]), 14 p p . 95. Iowa Year Book of Agriculture, 1921, p p . 399-400. 96. H. C. Wallace, " T h e Year in Agriculture," USDA, Yearbook, 792/, p. 15. 97. New York Times, January 30, 1922, p. 10; World's Work, XLIII, March, 1922, P- 45998. National Agricultural Conference, Report, p. 171. 99. House, Committee on Agriculture, Stabilizing Prices of Farm Products, Hearings, 67th Cong., 2d sess., p p . 5-6. 100. Peter Norbeck to B. S. Payne, Peter Norbeck Papers. 101. U.S. Congress, House, Stabilizing Prices on Farm Products, 67th Cong., 4th sess., H. Rept. 1672 (February 20, 1923), 7 pp. 102. Senate, Committee on Agriculture and Forestry, Stabilizing Prices of Certain Agricultural Products, Hearings, 67th Cong., 2d sess., pp. 3-4. 103. H. C. Wallace to G. W . Norris, March 30, 1922, Files of the Secretary of Agriculture. 104. Cong. Ree., 67th Cong., 2d sess., December 20, 1921, p. 575. 105. USDA, Yearbook, 1921, p. 674; F. M. Surface and R. L. Bland, American Food in the World War and Reconstruction Period, p p . 114-115. 106. Joint Commission of Agricultural Inquiry, Hearings, I, p. 254. 107. National Agricultural Conference, Report, pp. 97-98, 147. 108. Peter Norbeck to P. W. Daugherty, December 16, 1922, Peter Norbeck Letter Collection, Western Historical Manuscripts Collection. 109. A.F.B.F., Weekly News Letter, December 21, 1922; U.S. Congress, House, Committee on Banking and Currency, Rural Credits, Hearings, 67th Cong., 3d and 4th sess. (1923), p. 40.

NOTES

323

110. New York Times, December 10, 1922, I, p. 2; Cong. Ree., 67th Cong., 4th sess., February 28, 1923, p. 4839. in.House, Committee on Agriculture, Stabilizing Prices of Farm Products, Hearings, 67th Cong., 2d sess., p. 42. 112. Chicago Tribune, January 12, 1922, p. 1. 113. National Stockman and Farmer, October 8, 1921, p. 19. See also U.S. Congress, Senate, Committee on Finance, Tariff Act of 1921, Hearings, 67th Cong., ist sess. (1922), 8 vols., passim. 114. Cong. Ree., 67th Cong., 2d sess., July 12, 1921, p. 3614. 115. U.S. Congress, House, Tariff Act of 1922, 67th Cong., 2d sess., H. Doc. 393 (September 20, 1922), 198 pp., passim. 116. A.F.B.F., Weekly News Letter, February 10, 1921. 117. Gray Silver 1922 annual report, in A.F.B.F., "Annual Administrative Reports, 1922," p. 79, in USDA Library. See also report of T. C. Atkeson, Patrons of Husbandry, Proceedings, National Grange, November, 1923, p. log. 118. David Friday, "The Tariff and the Cost of Living," Review of Reviews, LXVI (November, 1922), p. 50g. See also F. W. Taussig, Quarterly Journal of Economics, (November, 1922), pp. 1-28. 119. Wallaces' Farmer, June 15, 1923, p. 5. 120. Carle C. Zimmerman and John D. Black, The Marketing Attitudes of Minnesota Farmers, University of Minnesota Agricultural Experiment Station, Technical Bulletin 45 (1926), p. 47. 121. Secretary of Commerce, Tenth Annual Report, 1922, p. 20. 122. A.F.B.F., Weekly News Letter, January 11, 1923. 123. Patrons of Husbandry, Proceedings, National Grange, November, 1922, p. 40. 124. Gray Silver, Annual Report, 1923, pp. 1-3. See also A.F.B.F., Weekly News Letter, March 8, 1923. Notes to Chapter Pages

VII

189-216

1. Wallaces' Farmer, September 16, 1921, p. 4. 2. USDA, Yearbook, 1921, pp. 71-73. 3. Ibid., p. 12; USDA, Weather, Crops and Markets, I (January 14, 1922), p. 40. 4. USDA, The Agricultural Situation, II (August, 1922), p. 5; USDA, Yearbook, 1922, p. 711. 5. Henry E. Witte to H. C. Wallace, November 7, 1921, Files of the Secretary of Agriculture. 6. Joint Commission of Agricultural Inquiry, Hearings, I, p. 183. 7. Cooperative Manager and Farmer, X I (December, 1921), p. 60. 8. H. C. Wallace, "The Year in Agriculture," USDA, Yearbook, 1921, pp. 2, 5-7, 10-12; Iowa Year Book of Agriculture, 1921, p. 178. 9. USDA, BAE, Consumption of Agricultural Products, mimeographed (March, 1941), p. 13. 10. Joint Commission of Agricultural Inquiry, Report, I, The Agricultural Crisis, P- 15911. Cooperative Manager and Farmer, October, 1921, p. 51; Joint Commission of Agricultural Inquiry, Hearings, I, pp. 393-406. 12. California State Market Director, Fourth Annual Report, 1919, p. 79; Cong. Ree., 66th Cong,, 2d sess., February 9, 1920, p. 2655. 13. Sapiro, Cooperative Marketing, A.F.B.F. Pamphlet No. 4, p. 9; California Cultivator, January 31, 1920, p. 164. See also S. W. Shear and H. F. Gould, Economic Status of the Grape Industry, University of California Agricultural Experiment Station Bulletin 429 (June, 1927), pp. 3-10. 14. [R. A. White], Milo Reno, p. 70.

324

NOTES

15. H. C. Wallace, " T h e Year in Agriculture," USDA, Yearbook, 1922, p. 8. 16. Senate, Committee on Agriculture and Forestry, Stabilizing Prices of Certain Agricultural Products, Hearings, 67th Cong., 2d sess., p. 5. 17. M. M. Regan, et al., The Farm, Real Estate Situation, USDA, Circular 743 (October, 1945), p. 16; David L. Wickens, Farmer Bankruptcies, 1898-19}$, USDA, Circular 414 (September, 1936), pp. 2, 12. 18. War Finance Corporation, Fifth Annual Report, 1922, p. 2. 19. Eugene Meyer, Jr., "Lending Two Million a Day," Country Gentleman, LXXXVII (April 8, 1922), pp. 13, 24. 20. Eugene Meyer, Jr., "Farm Financing and Business Prosperity," address before the Association of Advertisers Clubs of the World, June 13, 1922 [WFC: 1922], p. 6; U.S. War Finance Corporation, Circular No. 2, Information for Banks, Bankers, or Trust Companies Applying for Advances under Section 24 of the War Finance Corporation Act (September 1, 1921), pp. 3-4. 21. Secretary of the Treasury, Annual Report, 1922, p. 37; War Finance Corporation, Sixth Annual Report, 192p. 4. 22. A.F.B.F., Weekly News Letter, February 9, 1922; New York Times, January 28, 1922, p. 2. 23. Patrons of Husbandry, Proceedings, National Grange, November, 1921, p. 58. 24. Iowa Year Book of Agriculture, 1919, pp. 596-597. 25. H. A. Wallace, Agricultural Prices, pp. 28, 52-56. 26. USDA, Yearbook, 1918, pp. 648-695; Yearbook, 1919, pp. 736-738. 27. USDA, Yearbook, 1920, pp. 818, 825. 28. H. C. Wallace, Our Debt and Duty to the Farmer, p. 210. 29. Files of the Secretary of Agriculture. 30. Wallaces' Farmer, October 22, 1920, p. 2469. 31. Ibid., May 27, 1921, p. 4. 32. Joint Commission of Agricultural Inquiry, Report, I, The Agricultural Crisis, P- 933. Joint Commission of Agricultural Inquiry, Hearings, III, pp. 348-349. 34. Joint Commission of Agricultural Inquiry, Report, I, The Agricultural Crisis, p. 27. See also Ernest W. Grove, "Income Parity for Agriculture," unpublished doctoral dissertation, University of California, 1949, 634 pp. 35. Joint Commission of Agricultural Inquiry, Report, I, The Agricultural Crisis, p. 24. 36. G. F. Warren, Prices of Farm Products, pp. 16-24. 37. President's Conference on Unemployment, Report, "Report of the Committee on Agriculture," pp. 152-155. 38. H. C. Wallace, "Corn as Fuel," USDA press release, H. C. Wallace, "Addresses and Statements," USDA Library. 39. C. R. Ball, et al., "Wheat Production and Marketing," USDA, Yearbook, 1921, p. 147. See also pp. 118, 148-149; C. E. Leighty, et al., "The Corn Crop," USDA, Yearbook, 1921, pp. 214-215, 220-222. 40. USDA, Weather, Crops and Markets, I (March 4, 1922), p. 188; (March 18, 1922), p. 243; USDA, Agricultural Situation, II (July, 1922), pp. 3-4. 41. James H. Shideler, " T h e Development of the Parity Price Formula for Agriculture, 1919-1923," Agricultural History, XXVII (July, 1953), pp. 79-81. See also John D. Black and Bruce D. Mudgett, Research in Agricultural Index Numbers; Scope and Method, Social Science Research Council Bulletin No. 10 (New York: 1938), pp. 4-5. 42. H. C. Taylor, "Henry C. Wallace and the Farmers' Fight for the Right," unpublished manuscript, 14 pp., Henry C. Taylor Papers; W. G. Harding to H. C. Wallace, December 30, 1921, National Agricultural Conference, Report, pp. 3-4. 43. Patrons of Husbandry, Proceedings, National Grange, November, 1922, p. 39. 44. National Agricultural Conference, Report, p. 132. 45. Boston Evening Transcript, January 24, 1922, p. 20. 46. Richard T . Ely, " T h e National Agricultural Conference," American Review of Reviews, LXV (March, 1922), pp. 271-274.

NOTES

325

47. National Agricultural Conference, "Verbatim Report," afternoon session, January ag, 1922, pp. 35-38, Files of the Secretary of Agriculture. 48. National Agricultural Conference, Report, p. 135. 4g. Ibid., p. 171. 50. Ibid. See also John D. Black, " T h e McNary-Haugen Movement," American Economic Review, XVIII (September, 1928), p. 406; testimony of W. H. Lyon, Senate, Committee on Agriculture and Forestry, Stabilizing Prices of Certain Agricultural Products, Hearings, 67th Cong., 2d sess., p. 87. 51. National Agricultural Conference, "Verbatim Report," evening session, January 26, 1922, p. 60, Files of the Secretary of Agriculture. See also Prairie Farmer, February 4, 1922, pp. 9, 15, 22. 52. National Agricultural Conference, "Verbatim Report," morning session, January 27, 1922, pp. 78-79, Files of the Secretary of Agriculture. 53. Labor, March 11, 1922, p. 2. See also Rural New Yorker, February 11, 1922, p. 197; Samuel Gompers, "Farm and Factory Workers Shall Not Be Drawn into Hostile Camps," American Federationist, XXIX (March, 1922), pp. 177-186. 54. National Agricultural Conference, "Verbatim Report," morning session, January 27, 1922, p. 83, Files of the Secretary of Agriculture. ¡¡g. Ibid., afternoon session, January 28, 1922, pp. 8, 81 A-C, 89, 92. See also Ohio Farmer, February 4, 1922, p. 114. 56. New York Times, January 24, 1922, p. 1. 57. National Agricultural Conference, Report, p. 138. 58. Ibid., p. 147. 59. Ibid., p. 98. 60. Clyde L. King, "Farm Conferences," Survey, XLVII (February 11, 1922), p. 758. 61. National Agricultural Conference, Report, pp. 138, 140. 62. Gilbert C. Fite, George N. Peek and the Fight for Farm Parity (University of Oklahoma Press, 1954), pp. 42-43. Hereafter cited as G. C. Fite, Peek. 63. Hugh S. Johnson, The Blue Eagle From Egg to Earth (Garden City, New York: Doubleday, Doran, 1935), p. 104. Hereafter cited as H. S. Johnson, Blue Eagle. 64. Ibid. 65. Wallaces' Farmer, September 2, 1927, p. 5; National Agricultural Conference, Report, pp. 137-138, 171; George N. Peek, "Equality for Agriculture with Industry," Proceedings of the Academy of Political Science, XII (January, 1927), p. 69; George N. Peek, Repairing the Farmer's Dollar (n.p., n.d.), p. 10; G. C. Fite, Peek, pp. 45-51. 66. [George N. Peek and Hugh S. Johnson], Equality for Agriculture ([Moline, 111.]: 1922), p. 22. 67. John D. Black, Parity, Parity, Parity (Harvard University Press, 1942), p. 46. 68. [G. N. Peek and H. S. Johnson], Equality for Agriculture, p. 10. 69. L. Domeratzky memorandum to Herbert Hoover, February 1, 1922, Hoover Archives. 70. Herbert Hoover, Economic Factors in Railway Rate Adjustment, Statement of Hon. Herbert Hoover, Secretary of Commerce Before the Interstate Commerce Commission, February 3, 1922 (Washington: 1922), pp. 6-7, 15; Herbert Hoover, The Problem of Prosperity and the Part in It Played by the American Railroads (New York: 1922), 23 pp. 71. Henry C. Taylor to the author. See also J. D. Black, American Economic Review, (September, 1928), p. 406. 72. [USDA], "Agricultural Prices Compared, Jan., 1921-Feb., 1922" (n.d.), pp. 1-7, C. C. Davis Papers, Western Historical Manuscripts Collection; H. C. Taylor, "A Farm Economist in Washington" pp. 188-189. 73. [USDA], "Conference called by Secretary Wallace, Monday, February 13, 1922, at 10 o'clock to Consider Means of Reestablishing a Fair Ratio of Exchange Between Farm Products and Other Products," typewritten stenographic report, 92 pp., USDA Library; Henry C. Taylor to the author. See also H. C. Taylor, Story of Agricultural Economics, pp. 583-590; A. Christenson, "Agricultural Pressure," pp. 124-126; J. D.

NOTES

326

Black, American Economic Review (September, 1928), pp. 406-407; H. C. Wallace testimony, Senate, Committee on Agriculture and Forestry, Purchase and Sale of Farm Products, Hearings, 68th Cong., ist sess., p. 349. 74. H. S. Johnson, Blue Eagle, p. 105. 75. G. N. Peek, Repairing the Farmer's Dollar, p. 11. 76. H. C. Taylor and G. F. Warren, memorandum to Secretary Wallace, February 3, 1922, Files of the Secretary of Agriculture. 77. H. S. Johnson, Blue Eagle, p. 105. 78. H. C. Wallace testimony, Senate, Committee on Agriculture and Forestry, Purchase and Sale of Farm Products, Hearings, 68th Cong., ist sess., p. 352. 79. Bernard Baruch to H. C. Wallace, March 1, 1922, Files of the Secretary of Agriculture. 80. USDA, Official Record, August 23, 1922, p. 2. 81. G. N. Peek, Repairing the Farmer's Dollar, p.i 1. 82. G. N. Peek and H. S. Johnson to F. M. Surface, March 21, 1923, Hoover Archives. 83. George N. Peek and Hugh S. Johnson, Equality for Agriculture (Moline, 111. [1922]), 2d ed., 32 pp.; A. Christensen, "Agricultural Pressure," pp. 118-119. 84. Aaron Sapiro to the author.

Notes to Chapter VIII Pages 217-242 1. New York Times, November 16, 1921, p. 16. 2. T h e "Cooperators' Congress" consisted of the Iowa Farmers' Union and the Society of Equity; Wallaces' Farmer, February 24, 1922, p. 8. 3. Brotherhood of Locomotive Firemen and Enginemen's Magazine, LXXII (April 1, 1922), p. 6. Hereafter cited as B.LJand E. Magazine. 4. New York Times, October 6, 1921, p. 3. 5. American Federation of Labor, Proceedings, 1922, pp. 112, 329. 6. B.L.F. and E. Magazine, LXXII (February 15, 1922), p. 8. 7. Brotherhood of Locomotive Engineers Journal, LVI (March, 1922), p. 168. 8. Morris Hillquit, Loose Leaves from a Busy Life (New York: Macmillan, 1934), pp. 310-311. See also B.L.F. and E. Magazine, LXXII (March 15, 1922), pp. 3-4. 9. Brotherhood of Locomotive Engineers Journal, LVI (May, 1922), p. 337. 10. Labor, May 13, 1922. 11. Labor, April 8, 1922. See also Chester Rowell, "Brookhart, Howell, and 'Brother Charley' Bryan; T h e Radical Revolt in Iowa and Nebraska," World's Work, XLVI (September, 1923), p. 479. 12. Jerry A. Neprash, The Brookhart Campaigns in Iowa, 1920-1926; A Study in the Motivation of Political Attitudes (Columbia University Press, 1932), pp. 35-40. 13. National Leader, April 17, 1922, p. 6. 14. Robert Litteil, "Henrik Shipstead," New Republic, XXX (January 3, 1923), pp. 146-148. 15. Labor, October 14, 1922. 16. For an analysis of the vote see Stuart A. Rice, Farmers and Workers in American Politics (Columbia University Press, 1924), pp. 160-163. 17. New York Times, June 25, 1922, II, p. 3. 18. National Leader, July, 1922, p. 7. 19. Labor, July 29, 1922. 20. National Leader, October, 1922, p. 7. 21. New York Times, June 9, 1922, p. 18. 22. Gilbert C. Fite, "Oklahoma's Reconstruction League: An Experiment in Farmer-Labor Politics," Journal of Southern History, XIII (November, 1947), pp. 537-53923. National Leader, October, 1922, p. 7. See also Nation, CXV (November 22, 1922), p. 545.

NOTES

327

24. Brotherhood of Locomotive Engineers Journal, LVI (September, 1922), p. 667. 25. New Republic (November 3, 1922), p. 230. 26. William Allen White, "As I See It," New York Sunday Tribune, November 12, 1922, quoted in S. A. Rice, Farmers and Workers in American Politics, p. 31. 27. Hillard D. Garritson, "A Progressive Governor for Colorado," Nation, CXV (November 22, 1922), p. 544. 28. New York Times, November 9, 1922, p. C. 29. Mark Sullivan, "The Corn Belt from a Car Window," World's Work, XLV (December, 1922), pp. 215-221, and subsequent articles. Chester H. Rowell, "Why the Middle West Went Radical," World's Work, XLVI (June, 1923), pp. 157-165, and subsequent articles. 30. Quoted in Literary Digest, LXXV (November 18, 1922), p. 10. 31. Cong. Ree., 67th Cong., 3d sess., November 28, 1922, p. 328. 32. Labor, November 18, 1922. 33. New York Times, November 3, 1922, p. 1. 34. Quoted in Literary Digest, LXXV (November 18, 1922), p. 11. 35. Walter Lippmann, "What Chance Has a Third Party?" Colliers' Magazine, L X X (November 18, 1922), pp. 5-6. 36. New York Times, December 1, 1922, p. 1. 37. Ibid., November 19, 1922, p. 3. 38. La Follette's Magazine, XIV (November, 1922), p. 165. 39. Washington, D.C., Evening Star, December 2, 1922. 40. New York Times, November 10, 1922, p. 2. 41. Cong. Ree., 67th Cong., 4th sess., December 8, 1922, pp. 212-216. 42. New York Times, December 12, 1922, p. C. 43. Ibid., December 13, 1922, p. 1. 44. Ibid. 45. Ibid., February 25, 1923, II, p. 4. 46. Labor, February 3, 1923. 47. Aaron Sapiro to the author. 48. Senate, Committee on Agriculture and Forestry, Federal Cooperative Marketing Board, Hearings, 68th Cong., 2d sess., p. 221. See also A. M. Loomis, "Cooperative Marketing Associations Meet," Hoard's Dairyman, LXIV (December 29, 1922), p. 710. 49. Frederic L. Paxson, Postwar Years: Normalcy, 1918-1923 (University of California Press, 1948), p. 361. 50. Wallaces' Farmer, July 6, 1923, p. 11. 51. Orange Judd Farmer, March 15, 1923, p. 7. 52. U.S. Congress, Senate, Committee on Agriculture and Forestry, Providing for the Purchase and Sale of Farm Products, Hearings, 67th Cong., 4th sess. (1922), 162 pp. Notes to Chapter

IX

Pages 243-2 79 1. USD A, Agricultural Situation, III (May 1, 1923), pp. 18-22. 2. Harold Cary, "Out Where the Wealth Begins," Collier's Magazine, L X X I (April 14, 1923), p. 6. 3. New York Times, June 2, 1923, p. 5. 4. Letter to the editor, Wallaces' Farmer, June 22, 1923, p. 4. 5. Collier's Magazine, LXXII (July 21, 1923), p. 6. 6. Saturday Evening Post, CXCV (March 10, 1923), p. 166. 7. New York Times, December 4, 1922, p. 1. 8. Labor, January 6, 1923-. g. New York Times, June 24, 1923, pp. 1, 20, 10. Brotherhood of Locomotive Engineers Journal, LVII (August, 1923), p. 646. See also Robert Morss Lovett, "The Farmer-Labor Fiasco at Chicago," New Republic, XXXV (July 18, 1923), pp. 198-200.

3

28

NOTES

11. Benjamin Gitlow, I Confess. The Truth about American Communism (New York: E. P. Dutton, 1940), pp. 194-195. 12. National Leader, July, 1923, p. 3. 13. Benjamin F. Yoakum, "The Farmer's Chance," Forum, L X X (September, 1923), pp. 1942-1943. 14. New York Times, July 21, 1923, p. 3. 15. Chester Rowell, "La Follette, Shipstead, and the Embattled Farmers," World's Work, XLVI (August, 1923), p. 411. 16. New York Times, July 18, 1923, p. 1; July 20, p. 2; July 28, p. 1. 17. Country Gentleman, L X X X V I I I (July 21, 1923), p. 12. 18. Aaron Sapiro to the author. ig. National Council of Farmers' Cooperative Marketing Associations, "Proceedings, First National Cooperative Marketing Conference, Washington, D.C., December, 1922," typewritten report in USDA Library. 20. Ibid., pp. 7-38. See also A. M. Loomis, Hoard's Dairyman, December 29, 1922, p. 710. 21. O. M. Kile, The Farm Bureau through Three Decades, p. 112. 22. A.F.B.F., Fourth Annual Convention, 1922, pp. 118-119, , s a 23. Ibid., p. 53; National Council of Farmers' Cooperative Marketing Associations, "Proceedings, First N a t i o n a l . . . Conference," pp. 42-45. 24. FTC, Cooperative Marketing, pp. 73, 75. 25. A.F.B.F. Executive Committee meeting, September 22, 1923, mimeographed stenographic record, Files of the Secretary of Agriculture. 26. O. M. Kile, The Farm Bureau through Three Decades, p. 121. 27. New York Times, August 5, 1928, p. 27. 28. Babson's Reports, July 31, 1923, p. 1. 29. Governor A. M. Hyde Papers, Western Historical Manuscripts Collection. 30. Wheat Council of the United States, National Wheat Conference; Report of Proceedings, Chicago, June 19-20,1923, p. 79. 31. A. M. Hyde to Chester Gray, June 25, 1923, A. M. Hyde Papers. 32. William Johnson, "Trouble Wheat," Country Gentleman, L X X X V I I I (July 14, 1923), pp. 3-4. 33. Wallaces' Farmer, August 24, 1923, p. 5; H. C. Wallace, "The Wheat Situation," USDA, Yearbook, 1923, p. 138. 34. Northwestern Miller, July 4, 1923, p. 45; New York Times, July 2, 1923, p. 1; July 21, p. 2. 35. New York Times, July 27, 1923, p. 2. 36. H. S. Yohe to the author; Eugene Meyer to the author; H. S. Yohe to H. C. Wallace, October 9, 1923, Files of the Secretary of Agriculture. 37. Eugene Meyer to President Coolidge, October 8, 1923, Calvin Coolidge Papers; H. S. Yohe to H. C. Wallace, October 9, 1923, Records of the Bureau of Agricultural Economics. 38. F. B. Wells to H. C. Wallace, October 18, 1923; October 29, 1923; Minneapolis Journal, October [18?], 1923, clipping, all in Files of the Secretary of Agriculture. Chester C. Davis to the author; Eugene Meyer to the author; Eugene Meyer to C. Bascom Slemp, October 1 1 , 1923, Calvin Coolidge Papers. 39. H. S. Yohe to the author; H. S. Yohe to H. C. Wallace, October 16, 1923, Files of the Secretary of Agriculture. 40. U.S. War Finance Corporation, Report to the President on the Wheat Situation by Eugene Meyer, Jr. and Frank W. Mondell (November 5, 1923), pp. 8 - 1 1 , manuscript copy in Calvin Coolidge Papers. 41. Charles Herreid to Herbert Hoover, October 17, 1923, Hoover Archives. 42. C. W. Pugsley to H. C. Wallace, October 23, 1923, Files of the Secretary of Agriculture. 43. H. C. Wallace, "The Year in Agriculture," USDA, Yearbook, 1922, p. 1. 44. H. C. Wallace memorandum to W. G. Harding, June 15, 1923, Files of the Secretary of Agriculture.

NOTES

329

45. H. C. Taylor, "A Farm Economist in Washington," pp. 192-194. 46. USDA press release, August 20, 1923, Calvin Coolidge Papers. 47. H. C. Wallace, "Report on Agriculture," USDA press release, September 25, 1923, in H. C. Wallace, "Addresses and Statements," USDA Library. 48. H. C. Taylor to H. C. Wallace, September 22, 1923, Henry C. Taylor Papers. 49. H. C. Taylor, Story of Agricultural Economics, pp. 591-595; H. C. Taylor, "Henry C. Wallace and the Farmers' Fight for the Right," p. 8. 50. H. C. Wallace to H. C. Taylor, September 29, 1923, Henry C. Taylor Papers. 51. W. A. Schoenfeld, Acting Chief of the Bureau of Agricultural Economics, to H. C. Taylor, October 8, 1923, Records of the Bureau of Agricultural Economics; William A. Schoenfeld to the author; F. W. Mondell to C. Bascom Slemp, October 19, 1923, Calvin Coolidge Papers. 52. Chester C. Davis to the author; H. C. Taylor, daybook, Henry C. Taylor Papers. 53. H. C. Taylor to H. C. Wallace, October 17, 1923, Henry C. Taylor Papers. 54. H. C. Taylor to H. C. Wallace, October 16, 1923, Henry C. Taylor Papers. 55. H. C. Taylor to H. C. Wallace, October 24, 1923, Records of the Bureau of Agricultural Economics. 56. Henry C. Taylor to the author; William A. Schoenfeld to the author. See also H. C. Taylor, Story of Agricultural Economics, pp. 595-596; R. Lord, Wallaces of Iowa, pp. 251-254; and Henry A. Wallace, New Frontiers (New York: Reynal and Hitchcock, 1934), p. 148. 57. Wallaces' Farmer, November 16, 1923, p. 7. 58. Henry C. Wallace, The Wheat Situation, A Report to the President, December, 1923, pp. iv-126; USDA, Yearbook, 1923, pp. 95-150; O. C. Stine to the author. 59. H. C. Wallace, "The Wheat Situation," USDA, yearbook, 192}, pp. 100-101. 60. Ibid.., p. 150. 61. Wallaces' Farmer, October 19, 1923, p. 4. 62. Hugh S. Johnson memorandum to H. C. Wallace [fall, 1923], copy in Chester C. Davis Papers. 63. L. H. Goddard to H. C. Wallace, October 17, 1923, Files of the Secretary of Agriculture. 64. H. C. Wallace to F. B. Wells, October 22, 1923, Files of the Secretary of Agriculture. 65. H. C. Wallace, "The Year in Agriculture," USDA, Yearbook, 1923, pp. 17-19. 66. Chicago Commerce, XXX (November 17, 1923), pp. 9-10. 67. H. C. Wallace to C. Bascom Slemp, November 30, 1923, Calvin Coolidge Papers. 68. Calvin Coolidge to R. W. Bingham, November 10, 1923, Calvin Coolidge Papers; New York Times, November 15, 1923, p. 30. 69. Charles J . Brand, "The Price Balance between Agriculture and Industry," Proceedings of the Academy of Political Science, X I (January, 1925), p. 26. 70. C. J . Brand testimony, Senate, Committee on Agriculture and Forestry, Purchase and Sale of Farm Products, Hearings, 68th Cong., 1st sess., pp. 578-579, 582; H. C. Wallace testimony, pp. 350-352. See also C. J . Brand testimony, U.S. Congress, House, Committee on Agriculture, NcNary-Haugen Bill, Hearings, 68th Cong., 1st sess. (1924), pp. 43, 568-569, 607-608. 71. Cong. Rec., 68th Cong., 1st sess., December 6, 1923, p. 100. 72. Wallaces' Farmer, December 14, 1923, p. 16. 73. "Report of Proceedings, President's Conference on Northwestern Agriculture and Finance, Washington, D.C., February 4, 1924," a memorandum, Hoover Archives. 74. Chester C. Davis to the author. 75. Agricultural Securities Corporation, Agricultural Credit Corporation, Report for the Fiscal Year Ended December 31st, 1924 (Minneapolis: n.d.), 6 pp. 76. James H. Shideler, "Herbert Hoover and the Federal Farm Board Project, 1921-1925," Mississippi Valley Historical Review, X L I I (March, 1956), pp. 710-729. 77. Herbert Hoover to A. B. Williams, March 29, 1924, Hoover Archives.

NOTES

33°

78. O. E. Bradfute to Calvin Coolidge, April 15, 1924, Hoover Archives. 79. G. F. Warren to Calvin Coolidge, April 3, 1924, Hoover Archives. 80. H. C. Wallace to Calvin Coolidge, April 8, 1924, Hoover Archives. 81. W. M. Jardine to Calvin Coolidge, April 7, 1924, Hoover Archives. 82. Charles W. Wood, "If I Were President; Henry Ford Tells Where He Stands on All of the Great Issues of the Day; An Authorized Interview," Collier's Magazine, L X X I I (August 4, 1923), pp. 5-6, 28-29. 83. Cong. Ree., 68th Cong., ist sess., March 10, 1924, p. 3927. 84. Senate, Committee on Agriculture and Forestry, Purchase and Sale of Farm Products, Hearings, 68th Cong., ist sess., p. 720. 85. U.S. Congress, Senate, Agricultural Export Bill, S. Rept. 193, Part 2, 68th Cong., ist sess. (March 5, 1924), 6 pp. 86. Iowa Homestead, April 17, 1924, p. 1. 87. Senate, Committee on Agriculture and Forestry, Purchase and Sale of Farm Products, Hearings, 68th Cong., ist sess., pp. 320-324. 88. Farmers' National Council, press release, January 23, 1924, Files of the Secretary of Agriculture. 89. Senate, Committee on Agriculture and Forestry, Purchase and Sale of Farm Products, Hearings, 68th Cong., ist sess., p. 580. 90. Ibid., p. 380. 91. U.S. Congress, House, The McNary-Haugen Bill, H. Rept. 631, 68th Cong., ist sess. (May 2, 1924), pp. 2-3. 92. Henry A. Wallace to the author. 93. Country Gentleman, L X X X I X (March 22, 1924), p. 14. 94. Senate, Committee on Agriculture and Forestry, Purchase and Sale of Farm Products, Hearings, 68th Cong., ist sess., p. 658. 95. L . G. Michael to H. C. Wallace, January 24, 1924, Records of the Bureau of Agricultural Economics. 96. H. C. Wallace to Otto H. Kahn, February 20, 1924; Otto H. Kahn to H. C. Wallace, March 8, 1924, Files of the Secretary of Agriculture. 97. H. C. Wallace to Harvey Ingham, April 1 1 , 1924, Files of the Secretary of Agriculture. 98. Senate, Committee on Agriculture and Forestry, Purchase and Sale of Farm Products, Hearings, 68th Cong., ist sess., p. 353. 99. Unsigned memorandum [spring, 1924], Files of the Secretary of Agriculture. 100. Sydney Anderson to C. G. Selvig, February 28, 1924, Files of the Secretary of Agriculture. 101. Senate, Committee on Agriculture and Forestry, Purchase and Sale of Farm Products, Hearings, 68th Cong., ist sess., pp. 506-507. 102. Herbert Hoover to W. F. Schilling, February 12, 1924, Hoover Archives. 103. Cong. Ree., 68th Cong., ist sess., June 3, 1924, pp. 10340-10341.

Notes to Chapter X Pages 280-295 1. H. C. Wallace, " T h e Year in Agriculture," USDA, Yearbook, 1924, p. 17. 2. H. Rept. 631, The McNary-Haugen Bill, 68th Cong., ist sess., p. 14. 3. U.S. Congress, Senate, Agricultural Export Bill, S. Rept. 410, 68th Cong., ist sess. (April 10, 1924), p. 1. 4. USDA, BAE, Report of the Chief of the Bureau of Agricultural Economics, 1924, p. 2. 5. N. Olsen, USDA, Yearbook, 1924, p. 192. 6. Paul A. Eke, " T h e Price and Purchasing Power of Farm Land," Journal of Farm Economics, VII (October, 1925), p. 435; M. M. Regan, The Farm Real Estate Situation, USDA, Circular 548 (1939), p. 4.

NOTES

331

7. C. L. Holmes, "Agricultural Readjustment in the Corn Belt," Journal of Farm Economics, V I I (April, 1925), pp. 249-250. 8. E. G. Nourse, Journal of Farm Economics, January, 1927, p. 50. 9. World's Work, X L V I I I (July, 1924), p. 244. 10. Patrons of Husbandry, Proceedings, National Grange, November, 1923, p. 50. 1 1 . USDA, Agricultural Situation, IV (July 1, 1923), pp. 16-17. 12. Henry C. Wallace, " A National Agricultural Program—A Farm Management Problem," Journal of Farm Economics, V I (January, 1924), p. 2. 13. Aaron Sapiro, Cooperative Wheat Marketing, address to National Wheat Growers' Advisory Committee, December 18, 1924 (Chicago: 1924), p. 8. 14. Edwin G. Nourse, "Fundamental Significance of the Agricultural Adjustment Concept," Journal of Farm Economics, X V I I I (May, 1936), p. 246. 15. E. G. Nourse, American Agriculture and the European Market, p. 236. 16. National Board of Farm Organizations, Proceedings, Annual Meeting, February 3-4. 19*5. P- 2. 17. Herbert Hoover draft of letter to President Coolidge, August 29, 1924, Hoover Archives. 18. Undated memorandum by W. M. Jardine on the first conference meeting, November 17, 1924, Records of the President's Agricultural Conference, T h e National Archives. 19. Herbert Hoover statement to the President's Agricultural Conference, January 19, 1925, Records of the President's Agricultural Conference. 20. Edwin G. Nourse, "Some Economic Factors in an American Agricultural Policy,", Journal of Farm Economics, V I I (January, 1925), pp. 1 - 2 1 . s i . H. G. Moulton, preface to E. G. Nourse, American Agriculture and the European Market, p. vii. 22. Herbert Hoover to M. L. Dean, March 12, 1924, Hoover Archives. 23. John D. Black, " T h e Role of Public Agencies in the Internal Readjustments of the Farm," Journal of Farm Economics, V I I (April, 1925), p. 166. 24. Herbert Hoover to E. D. Funk, May 3 1 , 1924, Hoover Archives. See also Country Gentleman, X C (January 10, 1925), p. 3. 25. USDA, Agricultural Situation, IV (July 1, 1923), p. 17. 26. Leon E. Truesdell, Farm Population of the United States, Census Monographs V I (Washington: 1926), p. 9. 27. A. B. Genung, "Looking Ahead," Better Crops (June, 1924), p. 16. 28. J . D. Black, Agricultural Reform, pp. 73-74.

Index

Abandonment of farms, 80, 82 Acreage restriction. See Agricultural adjustment; Crop restriction Adjustment of production. See Agricultural adjustment; Crop restriction Agrarian discontent, 244, 245, 260 Agrarian political revolt, 31-32, 234, 248«49 Agricultural adjustment: to balance supply and demand, 84; H. C. Wallace program, 125; program of USD A, 135141; obstacles to, 140, 285-286. See also Crop restriction Agricultural Adjustment Act, 141, 267 Agricultural bank, to serve farmers, 56 Agricultural colleges: plan for farmers' university, 133; study of agricultural economics in, 133. See also Land Grant College Association Agricultural Conference of >925, called by Coolidge, 289-290 Agricultural Cooperation, 116 Agricultural Credit Corporation, 270 Agricultural economics: H. C. Wallace view of, 125, 126; growth of the discipline, 131; studies in Department of Agriculture, 131; farm demand for study, 133; vogue for, 198. See also Bureau of Agricultural Economics Agricultural fundamentalism: argued before I.C.C., 60-61; an object lesson in, 79; reinforced, 153; in Peek plan, 210; H. C. Wallace view of, 204, 277. See also Bailey, Liberty Hyde; Hoch-Smith Resolution

Agricultural Marketing Act of 1929, 291. See also Federal Farm Board Agricultural Securities Corporation, 270 Agricultural Situation, 134 Agriculture and government: expansion of involvement, 3, 19-20, 118, 286-287, 291; agricultural legislation summed, 187-188; need for assistance, 266; rural resistance to planning, 293-294 Allen, Henry, calls for wheat embargo, 63 American Cooperative Association, 94 American Cotton Association, 36; campaign for cooperative marketing, 43; plea for credit aid, 55; acreage reduction plan, 85; Sapiro speech, 101. See also Wannamaker, J. S. American Council of Agriculture, founded, 288. See also McNary-Haugen bill American Cyanamid Corporation, 174 American Farm Bureau Federation: founded, 25-26; purposes, 25; party platform suggestions in 1920, 33; cooperative marketing work, 43,96,104-105, 111, 244, 252; on grain speculation, 62; pressure politics by, 68-69, 7°> 152-153. 154, 244; Muscle Shoals issue, 70, 173, 174; aid to agricultural economics study, 133; program for agricultural adjustment, 136; circular on excessprofits tax, 163; evidence for Joint Commission of Agricultural Inquiry, 167; supports St. Lawrence waterway, 175-176; "honest money" resolution.

333

334 American Farm Bureau (continued) 178; opposes price fixing, 181; endorses Norbeck-Nelson bill, 182; study of tariff, 187; Peek plan presented to, 210; 1922 convention, 249-250; internal problems, 250-251, 254; endorses McNary-Haugen bill, 275; limited achievements, 283 American Federation of Labor, for farmer-labor politics, 219 American Relief Administration, 21 American Wheat Growers Associated, 275 Anderson, J. M., 108 Anderson, Sydney: praises Farm Bloc, 165; address to National Agricultural Conference, 204; president of Wheat Council, 256; opposes McNary-Haugen bill, 278 Atkeson, Thomas C., 26, 30; on farm-city movement, 81; legislative desires satisfied, 188; testimony on disparity, 199200 Babson, Roger, 255 Bailey, Liberty Hyde, on virtue of farming, 78 Baker, O. E„ 135 Bank failures, caused by price decline, 71. See also Country banks Banking and Currency Committee, House, on farm lobby, 70 Bank of North Dakota, 93 Barnes, Julius, 213, 256, 269; Wheat Director, 22, 23; calls grain conference, 44; on grain speculation, 62; opposes Peek plan, 213; plan for diversification loans, 270; H. C. Wallace on, 277 Barrett, Charles S., 10, 30; attack on deflation conspiracy, 57; urges crop withholding, 65; on cost of production study, 132-133; on lobbying, 153; on agricultural inquiry, 157; on agrarian politics, 218 Baruch, Bernard, 66, 90, 98; assists Committee of Seventeen, 107; on Peek plan, 214-215; on McNary-Haugen bill, 276 Bean, Louis H., 135 Beveridge, Albert J., 221 Bingham Act, cooperative law, 113 Bingham, R. W., 258, 267 Black, John D., under H. C. Wallace, 135; on Peek plan, 211-212; outlaws crop restriction, 292 Blaine, J. J., 226 Boll weevil: reduces cotton crop of 1921, 85; Hoover plan, 143 Borah, William E., 229, 230, 231

INDEX Bouck, William, 247 Bradfute, Oscar E„ 251, 252, 254; on marketing, 95; on A.F.B.F. cooperative policy, 251; announces A.F.B.F. wheat holding plan, 251-252; on wheat acreage reduction, 257; on farm board plan, 271 Brand, Charles J.: on interdepartmental conflict, 149; author of McNaryHaugen draft, 267; antagonism of progressives to, 274; on McNary-Haugen bill, 275 Brookhart, Smith W., 155, 222, 257; his 1922 platform, 222; address to People's Lobby, 235; blocks ship subsidy, 238; his freight rate bill, 239; on third party prospects, 249 Brown, J. G., 153 Brown, Walter F., 143, 145 Bryan, Charles W., 225 Bryan, William J., 204 Bureau of Agricultural Economics, 130, 134-135; section on cooperation, 115; its program, 134, 135. See also Bureau of Markets; Taylor, Henry C. Bureau of Foreign and Domestic Commerce, 143 Bureau of Forestry, 143 Bureau of Labor Statistics Price Index, 199 Bureau of Markets, 134; proposed transfer, 143-144; Hoover on its functions, 144. See also Bureau of Agricultural Economics California Associated Raisin Company, Department of Justice suit against, 112 California cooperatives, gg, 105 California Fruit Growers' Exchange 94 California State Market Commission, cooperative marketing work, 99-100 Campbell, Macy, 82 Campbell, Milo D., 172 Capper, Arthur, 156, 165, 239; proposes Esch-Cummins amendment, 61; on grain speculation, 62; his Farm Bloc leadership, 165; bill to alter Federal Reserve Board, 172; new Farm Bloc program, 236-237 Capper-Hersman bill, 27 Capper intermediate credit bill, 170, 240 Capper-Tincher grain-futures bill, opposition from grain dealers, log. See also Grain Futures Act Capper-Volstead bill, 113, 114, 249; opposition from grain dealers, 109; de-

INDEX layed in Congress, 169; rural insistence on passage, 169-170 Census 1920, 42 Centralized cooperative associations. See Sapiro, Aaron Chamber of Commerce: view of farm crisis, 52; plan for farm problem study, 256; tardy action on farm problem, 295 Chicago Association of Commerce, H. C. Wallace speech to, 266 Chicago Cooperative Conference, 43-44, 101 Chicago Federation of Labor, 247 Christopherson bill, 73, 180, 181 Clayton Antitrust Act, legal status for cooperatives, 8, 27, 112 Collier's Magazine: 1923 political survey, 245; article on Henry Ford, 272 Commercialization, on farms in 19191920, 41 Committee of Forty-eight, 246-247 Committee of Seventeen: appointed to plan grain marketing cooperative, 44; its deliberations, 104-105; factions of, 106; its grain marketing plan, 106-107 Committee on Comparative Credit, of Farmers' Union, 155 Commodity analysis, in USDA, 137 "Commodity" marketing, 250. See also Sapiro, Aaron Communists, at Farmer-Labor Party convention, 247. See also Workers' Party Conference for Progressive Political Action, 220, 236, 246; "Call for Action," 219; state bodies of, 221; activity in 1922 primaries, 221-228 passim; opposes Farmer-Labor Party, 247 Conference on Northwestern Agriculture and Finance, 270 Congressional election 1922, influence of farm situation on, 221 Coolidge administration: and farm problem, 260; schism on farm policy, 263 Coolidge's Agricultural Conference. See Agricultural Conference of 1925 Coolidge, Calvin, 151, 268, 287; on tariff, 184; views on cooperation, 258; meets Northwest farm delegation, 258; his farm policy, 258, 267, 268, 293; hears H. S. Yohe on Meyer-Mondell mission, 259; his recall of Taylor tour, 263; his control of party, 268; on diversification loans, 270; aids farm board plan, 271; candidacy for President, 272; on McNary-Haugen issue, 278; appoints Agricultural Conference of 1925, 289; for crop restriction, 292

335 "Coolidge Pool," 259 Cooperation, 25, 90 Cooperative credit associations, 93 Cooperative Grange League Federation Exchange, 94 Cooperative insurance, 93 Cooperative marketing: legal recognition of, 26-27, 112-114, 167; its growth, 42, 98, 253; goal of market control, 43, 44, 68; credit for, 67, 114, 239; education for, 92; opportunity for marketing reform, 97-98; Sapiro plan, 99-104; ironclad contracts, 102; market research and promotion, 103; antitrust prosecutions, 112; protection from discrimination, 115; USDA research on, 115-116; limited gains in, 116-117; Harding endorsement of, 166, 121-122; outlook for 1923, 216; A.F.B.F. faith in, 244; government aid to, 249, 289-290; as panacea, 249; broken promises, 253-254; view of H. C. Wallace, 261, 264; Hoover plan for supervision of, 270-271. See also Committee of Seventeen; United States Grain Growers; Wheat pools Cooperative Marketing Council, 239, 249250, 251 Cooperative Marketing Division, of A.F.B.F., 251 Cooperative Marketing Division, of USDA, 116 Cooperative marketing law. See CapperHersman bill; Capper-Volstead bill; Clayton Antitrust Act; Volstead bill Cooperative movement, 91, 92; favored by Country Life Commission, 5 Cooperative purchasing, growth of, 92, 93- 94 Cooperative services, 92-93 Cooperatives, state and federal aid for, 114 Cooperators' Congress, at Des Moines in 1922, 177 Corn, 21, 48-49, 86-88 "Cornfield banking," 177 Corn for fuel, symbol of price disparity, 201 Cost of production: study of, 34, 132; increases during 1919-1920, 40-41; farmers' views on, 132-133; part of farm problem, 284-285 Cotton, 36, 49-50; acreage reduction, 85; 1923 crop estimates, 139. See also American Cotton Association Cotton Futures Act, 8 Coulter, John Lee, 269 Coulter Plan. See Conference on North-

336 Coulter Plan (continued) western Agriculture; Norbeck-Burtness bill Country banks, 161, 196, 282. See also Bank failures Country Gentleman: on H. C. Wallace, 128-129; on merchant marine issue, 174; endorses production reduction, 256; opposes Norris-Sinclair bill, 274; on McNary-Haugen bill, 276 Country Life Commission: favors cooperatives, 5; on farm-city movement, 81-82 County agents, relation to Farm Bureaus, 126-127. See also Smith-Lever Act Coverdale, John, 252, 254 Cox, James, 34, 35 Crop-estimate work, criticized, 138-139 Crop meters, 137 Crop reporting, 137, 167 Crop restriction, 21-22, 36, 55, 85-88, 207, 256, 264, 286, 295; alternative to surpluses, 84-85, 290; obstacles to, 87, 88, 8g; Harding approval of, 122; plan of Wheat Council, 256; endorsed by Coolidge, 268; endorsed by Hoover, 271; growing respectability of, 292. See also Agricultural adjustment Crop withholding, 56, 291; by wheat growers, 43, 51; of cotton in 1920, 5051; credit requirement of, 54-55; wheat strike, 64, 65, 66; A.F.B.F. wheat plan, 252, 257. See also Joseph Plan Cummins, Albert B., 28, 222, 273 Currency management, 178 Currency inflation. See Inflation Dairy Marketing Committee of Eleven, 253 Dairy products, 49 Dairying, alternative to surplus crops, 83 Daly, Alice L., 226 Davis, Chester C „ assists McNary-Haugen movement, 276 Davis, Jonathan, 229 Dawes, Charles G., 213 Dawes Plan, 286 Daylight saving time, 20, 26 Dearborn Independent, Sapiro libel suit, 100 Democratic Party, 1920 Convention, 35 Department of Agriculture, 17-18, 123151 passim, 288-289; emphasis on economics 7, 130-131; its model cooperative law, 112; and cooperatives, 115— 116; program for agricultural adjust-

INDEX ment, 135-141; Hoover on its duties, 144; its defense by farm groups, 144145; work on farm exports, 146-150; study of Peek plan, 213; study of McNary-Haugen bill, 277 Department of Commerce: expansion under Hoover, 142; work on farm exports, 146-150; encroachment on Department of Agriculture, 150; investigation of cooperative marketing, 270271 Department of Justice, Packer Consent Decree, 27 Dickinson, L. J., 150, 156 Dill, C. C „ 227 Disparity, 192, 198, 255, 263, 281; recognition and measurement of, 167, 197, 199-201, 284; Joint Commission of Agricultural Inquiry findings, 166, 200; causes for, 198; a protest to Harding 199; Hoover on causes of, 212; USD A study of, 213; H. C. Wallace on, 215, 260-261 Distribution, 14, 95-96, 284, 285; USDA study of costs, 97; findings of Joint Commission of Agricultural Inquiry, 168, 169. See also Marketing; Middleman; Orderly marketing Diversification, 82-83, 207, 264. See also Coulter, John L. Domestic allotment. See Wilson, M. L. Domestic market, 193; industrial use of farm products, 193; stimulation of consumption, 193. See also Market research by cooperatives; Prohibition Duncan, James A., 227 Eastern States Farmers' Exchange, 94 Economic nationalism, 183; rural convictions on, 182, 192, 295. See also Tariff protection Economists, disagreement on farm problem, 290 Edge, Walter, opposes Norris export bill, 161-162 Edison, Thomas A., plan for price stabilization, 178-179 Education. See Agricultural colleges; Smith-Hughes Act; Smith-Lever Act Elections: ig20, 35; 1924, 287-288.See also Congressional election, 1922 Emergency Tariff, 157, 183; debated, 7374; passes Congress, 156. See also Tariff protection. Equality for Agriculture, 209, 211; second edition, 215. See also Peek, George N. Equalization fee, in Peek plan, 211

INDEX Equity Society, 9. See also Wisconsin Society of Equity Equity Cooperative Exchange, 98, 108 Esch, J . J., on freight-rate increases, 29 Esch-Cummins Act, 28, 238-239 Everitt, James A., 67, 211 Ever-normal-granary, 67. See also Joseph Plan Excess-profits tax, farmers' view of, 163 Experiment stations, economic studies at, 134 Export Corporation Leagues, 262, 275 Export market, 2, 10-11, 16, 20-21, 3637, 182, 191, 255; credits for, 22, 47, 159, 207; War Finance Corporation loans, 53' 71-72; Outlook Conference on, 138; Hoover's views on, 142; USDA work, 146-150; H. C. Wallace on, 147; Department of Commerce work, 148-149; neglected by Joint Commission, 169; related to ship subsidy, 174; Representative Ten Eyck against subsidy, 183; influence of tariff, 187; key to farm problem, 192, 210, 284-286, 290; issue at National Agricultural Conference, 207-208; loans endorsed by Coolidge, 26g. See also Peek plan; Surplus Extension service: war work, 18; proposed budget cut, 26. See also County agents Export surplus. See Export market; Peek plan; Surplus Ezekiel, Mordecai, 135 Factory farms, 290 Fall, A. B., 123 Farm bankruptcy, increasing rate of, 195. See also Foreclosures Farm Bloc, 69, 155, 156, 237; membership of, 156; legislation passed by, 156-164 passim; its limitations, 164, 244; criticized, 165; defended, 165, 204, 288; Capper-Volstead bill issue, 170; its study of intermediate credit, 170; bill to alter Federal Reserve Board, 172; tariff issue, 184; an issue at National Agricultural Conference, 206; overshadows progressives, 220; strengthened by 1922 elections, 228; loss of influence, 235; program of Arthur Capper, 236; progressive cooperation, 239; intermediate credits achievement, 240; divided on McNary-Haugen bill, 279 Farm board plan. See Federal Farm Board Farm Bureaus, 18, 25, 126-127. See also American Farm Bureau Federation; County agents

337 Farm economics. See Agricultural economics Farm labor, 17, 40 Farm leadership, lack of, 283 Farm Loan System. See Federal Farm Loan Act Farm machinery. See Mechanization Farm management, 78, 264, 285 Farm problem, view of H. C. Wallace, 261-262 Farm relief, need for, 155 Farm Tariff Bloc, organized, 184 Farm-to-city movement, 42, 80-82, 281, 294 Farm vote, in 1920 election, 35 Farmer-Labor Party, 33, 220, 227; 1923 convention, 246-247; Minnesota, 32, 223 Farmer-labor politics, 32-33, 217, 218219; cooperation in 1922 primaries, 221-228 passim. See also Conference for Progressive Political Action; Farmer-Labor Party; La Follette, Robert M.; Third party Farmers' Educational and Cooperative Union, 9, 10, 155; pressure politics of, 24, 154; Committee on Comparative Credit, g7; agitation to abolish Federal Reserve, 171; endorses inflation, 178; cooperation with labor, 219. See also Barrett, Charles S. Farmers' Marketing Committee of Seventeen. See Committee of Seventeen Farmers' National Council, 24, 177; supports Plumb Plan, 28; for price fixing, 180; seeks farmer-labor cooperation, 219; opposes McNary-Haugen bill, 274275. See also Marsh, Benjamin C. Farmers' university. See Agricultural colleges Federal Farm Board, 122, 141, 291; Hoover plan for, 252-253, 269, 270-272; to succor cooperatives, 116; endorsed by Agricultural Conference of 1925, 289-290; power behind plan, 290 Federal Farm Loan Act, 8, 157, 158, 208; farm-loan associations, 93; resources strengthened, 162. See also Mortgage debt Federal Reserve Act, 7-8 Federal Reserve Board, 8, 38, 45, 52-53; anti-inflation action, 53, 54; farm criticism of, 54-58 passim, 171, 248; asked for crop withholding credits, 65; credit for cooperatives, 114; credit restriction by, 155; criticism by Joint Commission of Agricultural Inquiry, 167-168; its

338 Federal Reserve Board (continued) discount policy, 1921, 171; membership, 172, 208 Federal Trade Commission, 8; investigation of packers, 27; investigation of wheat prices, 63-64; investigation of grain trade, 64, 159; protection of cooperatives, 115 Federal Warehouse Act, 8, 67, 167, 176, 239. See also Warehouse receipts Federated Farmer-Labor Party. See Farmer-Labor Party Federated Fruit and Vegetable Growers, Inc., 253 Fertilizer trust, in Muscle Shoals issue, 172 Filled Milk bill, 176-177, 239 Fisher, Irving, plan to stabilize dollar, 178 Food administration, 12, 13, 20; relations with USDA, 12, 142; conservation program, 13; on distribution charges, 14; price fixing by, 14; farmer criticism of, 14-15; hog price control, 16. See also Hoover, Herbert C. Food Production Act, 17 Foodstuffs Division, in Department of Commerce, 148 Ford, Henry: views on agriculture, 80, 272; rural esteem for, 173; Muscle Shoals offer, 173, 174; sponsor of Edison plan, 178; potential third party leader, 232; presidential boom, 232, 272; an inflationist, 232. See also Dearborn Independent Ford Motor Company, wage policy, 232 Fordney-McCumber Tariff, 184-185; farmers' gains and losses, 187; Peek's criticism of, 215. See also Emergency tariff; Tariff protection Fordson tractor, 232 Foreclosures, 195, 282. See also Farm bankruptcy Foreign market. See Export market Frauds, during 1919 boom, 38-39 Frazier, Lynn J., 223-224, 235 Freight rates, 19, 29; effects of increase, 58, 59, 155; farmers charged two ways, 58-59; preferential rates for farmers, 61; in report of Joint Commission of Agricultural Inquiry, 168; preference for surplus exports, 182 French, Burton L „ 128 Friday, David, 84, 182 Fruit Marketing Committee of Twentyone, 253 Futures trading, 44, 62, 63-64, 168-169

INDEX Gary, Elbert, 52 Gates, L. W „ 278 Gearhart knitting machine, 77 Giffin, Wylie, 100 Gift corn program, surpluses for famine relief, 73, 181 Glass, Carter, 21; defense of Federal Reserve Board, 172; on inflationists, 177 Goldsborough bill, to stabilize currency, 178 Gompers, Samuel, 206, 219 Gooding wheat price fixing bill, 181, 241 Goodrich, P. E„ 105 Gore, Howard M „ 288 Government and agriculture. See Agriculture and government Grain Corporation: wheat price control, 22, 44, 160; plan for revival, 180, 205. See also Barnes, Julius Grain Dealers' National Association, opposes United States Grain Growers, 109 Grain Futures Act, 115, 159 Grain-futures trading, resumed in 1920, 44 Grain Marketing Company, 252 Grain standards, USDA work on, 128 Grain Standards Act, 8 Grain trade, 64, 159; control proposals, 64, 158-159; as cause of deflation, 158; hostile to Meyer-Mondell mission, 259. See also Futures trading Grange, 9,40; its pressure politics, 24, 152, 154, 244; condemns grain speculation, 62; opposes price fixing, 181; opinion on War Finance Corporation, 197; endorses McNary-Haugen bill, 275. See also Atkeson, Thomas C. Greenbacks, 177 Gregory, Clifford, 276 Gronna, A. J., 71 Gustafson, C. H., 108, 111 Harding, Warren G., 34, 152, 230, 237, 246; administration, 3, 118, 233; Minnesota farm speech 1920, 35; supported by farmers, 119; farm policy, 119, 120, 121, 244; Grange interview, 120; on tariff, 121, 184, 185; address to National Agricultural Conference, 121-122; on cooperation, 121, 250, Cabinet appointments, 123; on agricultural adjustment, 136; and Farm Bloc, 158, 165, 172, 206; message on War Finance Corporation, 162; messages on farm problem, 166, 237; on intermediate credits, 170, 240; on Federal Reserve Board membership, 172; on merchant marine issue, 174,

INDEX 175, 238; approves St. Lawrence waterway plan, 176; economic foreign policy, 192, 208; approves National Agricultural Conference, 202; begins western speaking tour, 246; death, 258 Harding, W. P. G., 55, 172; defends Federal Reserve policy, 57 Heflin, James Thomas, 229; on cotton crop estimates, 139 Hibbard, Benjamin H., 90; on freightrate burden, 58 Highway Act, farm views on, 162-163 Hoch-Smith Resolution, freight-rate privileges for farmers, 61. See also Freight rates Hog price fixing committee, 16 Hogs, 37, 280 Hoover, Herbert C., 123, 141, 148, 258; on war food problem, 12; as Food Administrator, 12, 13; on profiteering, 14; on orderly marketing, 14; on wheat expansion, 15; on export market, 16, 20, 37; farmer criticism of, 17; American Relief Administrator, 21; favors wheat price control, 22; on danger of food shortage, 45; head of gift corn program, 73; his farm board plan, 122, 142, 270-271, 280, 289; compared to H. C. Wallace, 129; appointed Secretary of Commerce, 141; views on agriculture, 142, 151; as agricultural leader, 142; his views on H. C. Wallace, 142; on boll weevil eradication, 143; on executive reorganization, 144, 146, 150; on foreign trade work, 147, 148, 149; offered Secretary of Agriculture post, 151, 289; opposes Norris-Sinclair bill, 160-161, 274; farm credit idea, 161; directs WFC bill, 162; favors intermediate credit, 170; approves tariff, 187; on Peek plan, 212, 214; adviser to Coolidge, 258, 269, 289; hears criticism of Meyer-Mondell mission, 260; views on cooperative marketing, 261; chairman of Conference on Northwestern Agriculture, 270; on McNary-Haugen bill, 278; on crop restriction, 292; on population growth, 293 House Committee on Appropriations, 150 House Military Affairs Committee, 173 House Rules issue, 245-246, 273 Houston, David F.: as Secretary of Agriculture, 7, 12, 30; on wheat price guarantee, 22; as Secretary of the Treasury, 30, 53; his view of export market, 37; defends his credit policy, 55; writes

339 WFC veto, 72; broadens economic work in USD A, 131 Howard, James R., 26, 213, 251; on deflation conspiracy, 57; on grain marketing plan, 107; on farm lobby, 153; on Farm Bloc, 165; endorses ship subsidy, 174 Howe, Frederic C., 218 Howell, R. W., 224-225 Huddleston, George, 245 Hunt, C. W., 95 Hyde, A. M., 256 Idaho primary 1922, 226 Illinois Agricultural Association, aids McNary-Haugen movement, 276, 277 Implement industry, 79 Index numbers, Wallace-Hoover issue, 129 Indiana primary 1922, 221 Industrial boom, 281 Inflation, as remedy for farm problem, 177-179 Intermediate credits, 114-115, 169, 170, 250; findings of Joint Commission of Agricultural Inquiry, 168; bills before Congress, 170, 240. See also Orderly marketing Intermediate Credit Act, 170, 244, 249 Intermediate Credit System, 115, 240 International Farm Congress, 154 International Institute of Agriculture, 148 Interstate Commerce Commission, on freight rates, 28-29, 60 Iowa Farm Bureau Federation: background of Farm Bloc, 69; on corn restriction, 87 Iowa Homestead, 276 Iowa primary 1922, 222 Jardine, William M., 78, 151, 271, 289 Jefferis, "Big Jeff," 224 Jewett, George C., 275 Johnson, Hugh, 210; author of Equality for Agriculture, 209, 210; promotion of Peek plan, 212-213; and H. C. Wallace, 214, 265 Johnson, Magnus, 223, 248; on agrarian discontent, 257-258 Johnston, William H., 220 Joint Commission of Agricultural Inquiry, 79, 157, 193, 209; on Federal Reserve policy, 57; on freight-rate increase, 59, 60; on distribution costs, 97; on orderly marketing, 112; on agricul-

34° Joint Commission (continued) tural adjustment, 136; on foreign market work, 147; responsibilities of, 166; hearings by, 166-167; reports by, 167169; drafts credit bill, 168; on disparity, 199, 200 Joint Congressional Committee on Reorganization, 143, 146 Joseph Plan, for crop holding, 67-68 Kahn, Otto H., 213-214, 277 Kellogg, Frank B.: Farm Bloc member, 156; introduces WFC bill, 162; bill to alter Federal Reserve Board, 172; campaign for reelection, 223 Kenyon, William S., 69; Farm Bloc invitation, 155; meeting with Harding, 158; appointed federal judge, 165, 222; on Russian relief, 181 Ketcham bill, 150 King, Clyde L., 208 Klein, Julius, 147-148 Labor, 219, 223 Labor unions, 218, 287 Ladd, Edwin F„ 156, 177 Ladd-Sinclair bill, 180-181 La Follette, Robert M., 32, 154, 156, 224, 225-226; candidacy for President, 226, 231, 245, 272, 287; leads progressive conference, 234-235; on packer investigation, 239; on growth of agrarian discontent, 249; his farm policy, 273 Land Grant College Association, 266; report on farm problem, 291, 294-295 Land values, 39, 194, 282 Lasker, A. D., 174 Lenroot-Anderson intermediate credit bill, 170 Lever Food Control Act, 12-13 Liberal Party, 246 Lindbergh, Charles A., 32, 248 Little bill, wheat price fixing, 181, 241 Livestock: price declines, 47-48, 190; cooperative marketing of, 253 Livestock Marketing Committee of Fifteen, 253 Lobbying: by farm organizations, 9, 24, 26, 288; in Sixty-sixth Congress, 68-69, 152; explanations for, 152-153. See also National Board of Farm Organizations Lodge, Henry C., 158, 161 Longworth, Nicholas, 184 Lowden, Frank O., 80 Lowell, S. J., 40, 152 Lubin, David, 99, 211

INDEX Lundeen, Ernest, 248 Lyman, Charles A., 24, 26, 205-206 Lyon surplus disposal plan, 210. See also Christopherson bill Lyon, W. H., 73 McCumber, Porter J., 13, 223-224 McKenzie Muscle Shoals bill, 273-274 Macklin, Theodore, 133-134 McNary-Haugen bill, 267, 270, 275, 286; sponsored by H. C. Wallace, 130; origin of principles, 192; movement behind it, 271, 276-278, 280, 288, 290; opposition to, 274; endorsements of, 275-276, 283; the case against it, 278; defeated in House, 279; its significance, 279, 287. See also American Council of Agriculture; Peek, George N.; Peek Plan Mansfield, R. I., 109 Market news service, 134 Market research by cooperatives, 103 Marketing, 95, g6, 97; Harding on, 166; Hoover on, 289. See also Cooperative marketing; Distribution; Orderly marketing Marsh, Benjamin C., 26, 175, 274 Meat, 11, 16 Meat packers. See Packers Mechanization of agriculture, 79, 284; during war, 18; auto and autotruck, 80. See also Implement industry; Tractors Mellon, Andrew, 123, 270; on Farm Loan Act amendment, 157; his tax plan, 163; endorses intermediate credit, 170 Merchant marine. See Ship subsidy Meredith, E. T., 30; favors crop holding, 67; on farm-city movement, 82; on budget cuts, 128 Meyer, Eugene, Jr., 22, 258; on WFC credit for orderly marketing, 115; plan to block Norris export bill, 161; on farm credits, 161; drafts intermediate credit bill, 170; opposes export credit plan, 182. See also War Finance Corporation Meyer-Mondell mission, 258-260. See also Taylor tour Middlemen, 5, 42, 91, 95-96, 155, 168. See also Distribution; Futures trading; Grain trade; Speculators Mills, Ogden, 168 Minnesota elections, 223, 248 Minnesota Farm Bureau Federation, 108 Minnesota Farmer-Labor Party, 247 Missouri Farmers' Association, 94 Moline Plow Company, 209-210 Mondell, Frank, 258

INDEX Montana primary 1922, «27 Monument to colored mammies, 182 Mortgage debt, 4, 40, 93, 194, 282. See also Federal Farm Loan Act Moses, George H.: on farm tariff, 74; on agrarian revolt, 249 Moulton, H. G., 290 Muscle Shoals, 172; and A.F.B.F., 26, 70; an agrarian issue, 172-174, 273. See also Ford, Henry Mutual insurance. See Cooperative insurance National Agricultural Conference, 1 2 1 122, 202-209; Wilson's failure to call, 30; on wheat acreage restriction, 88; on orderly marketing, 112; defense of USDA, 145; on foreign market work, 147; request for investigation of currency, 178; price-fixing issue, 180, 204205; plan for credit to export surpluses, 182; groups represented, 203; program of, 204; Peek parity resolution, 205; labor wage dispute, 205-206; Farm Bloc issue, 206; recommendations of, 207209; evaluation of, 209; Peek plan presented, 211 National Board of Farm Organizations, 10; lobbying, 24, 154; party platform suggestions, 33-34; calls farm credit conference, 55; endorses McNaryHaugen bill, 275 National Bureau of Economic Research, 167 National Council of Farmers' Cooperative Marketing Associations. See Cooperative Marketing Council National Industrial Conference of 1919, 29-30, 67 National Livestock Producers' Association, 253 National Milk Producers' Federation, 154 National Progressive Republican League, 235 National self-sufficiency, 192, 292 National Wheat Conference, 255 National Wheat Growers' Association, 43; wheat strike, 64-65; program of cooperative marketing, 66; crop restriction plan, 88 Nebraska primary 1922, 224-225 Nelson, John M., 245 Nelson, Knute, 247-248 Neo-Populist movement, 241-243, 245 "New Freedom," 7-9 New, Harry S„ 221 New Republic, 228

341 New York Times: on North Dakota radicalism, 224; on 1922 elections, 22g; forecast for 1924, 233; on Republican plight, 237; on Progressive Bloc, 245; on La Follette candidacy, 249 Nonpartisan League, 9, 28, 223-224; its program, g, 31; an example of agrarian politics, 31; national body founded, 3132; expansion into Minnesota, 32, 223 Nonpartisan Party of South Dakota, 226 Nonpartisan tactics, 233 Norbeck, Peter, 32, 165, 180, 182 Norbeck-Burtness diversification bill, 83; endorsed by Coolidge, 269, 278 Norbeck-Nelson export bill, 182 Norris, George W., 156, 162, 239; on his export bill, 160; criticism of WFC bill, 162; on Federal Reserve Board bill, 172; blocks Muscle Shoals lease, 173174. 273-274 Norris export bill, 159, 160; endorsements, 160, 241; opposition to, 161-162, 240. See also Norris-Sinclair bill Norris-Sinclair export bill, 248; endorsed by progressives, 273, 274; opposition to, 274. See also Norris export bill North Dakota primary 1922, 223-224 Northwest farm delegation, 258 Nourse, Edwin G., 65, 286 Office of Farm Management, 131 Office of Markets, 7, 131. See also Bureau of Markets. Oklahoma primary 1922, 226-227 O'Neal, Edward A., 254 Orderly marketing, 14, 42; seasonal holding of crops, 66; in Sapiro plan, 103; as farm relief, 1 x 1 - 1 1 2 , 169, 285; WFC credit for, 162; endorsed by Joint Commission of Agricultural Inquiry, 166169 passim; endorsement by Congress, 170, 176; approved by National Agricultural Conference, 207; in grain marketing plan, 257; in Meyer-Mondell report, 259. See also Cooperative marketing; Crop withholding; Intermediate credits; Sapiro, Aaron Outlook Conference 1923, 137-138; its reports, 138; criticized, 139 Outlook work, 137, 140, 141. See also Price forecasting Packers: legislation to control, 27; consent decree of 1919, 27; Armour and Morris merger, 239. See also Federal Trade Commission

INDEX

342 Packers and Stockyards Act, 158 Palmer, A. Mitchell, 27 Parity: base period for, 5; development of concept, 199-202; USDA statistics on, 201; formula developed, 202; becomes farm relief goal, 202; in Peek plan, 211; for farm relief, 264, 295; formula derided, 275, 278; concept analyzed, 291. See also Disparity Patrons of Husbandry. See Grange Peek, George N., 210; his plan at National Agricultural Conference, 205; author of Equality for Agriculture, 209, 210; crusade for his plan, 212-213, 215; on obstacles to his plan, 214, 215; Equality for Agriculture, 260; renewed interest in his plan, 276; on American Council of Agriculture, 288 Peek Plan: at National Agricultural Conference, 207; origins, 210; description of, 211, 212; USDA conference on, 213214; studied in Department of Agriculture, 214; political barriers to, 215; popular support for, 215-216, 241; obstacle to Meyer-Mondell mission, 259; influence on agrarian discontent, 260; promoted by H. C. Wallace, 261-268 passim. See also McNary-Haugen bill Pennsylvania primary 1922, 222 Penny sales, at farm auctions, 195 Penrose, Boies, 184 People's Bloc, 221. See also Progressive Bloc People's Legislative Service, 154, 220, 234; for farmer-labor politics, 219. See also Progressive Bloc People's Lobby, 235-236 People's Reconstruction League, 219 Peteet, Walton, 254; cooperative work for A.F.B.F., 251 Pinchot, Gifford, 222; urges farm organization, 23; on H. C. Wallace, 124 Plumb, Glenn E„ 28 Plumb Plan League, its political aims, 28 Poindexter, Miles, 227 Political parties, 3, 30-31, 217, 230. See also Third party; T w o party system Political revolt. See Agrarian revolt Pooling, in cooperative marketing, 103 Population growth, as remedy for farm problem, 293 Populist movement, 246 Post Office Department, aid to crop reporting, 137 Power farming. See Mechanization Prairie Farmer: favors Joseph Plan, 6768; endorses McNary-Haugen, 276

President's Conference on Unemployment, 201 Pressure politics, See Lobbying Preus, J. A. O., 223, 248 Price fixing: opposed by H. C. Wallace, 130; agitation for, 177, 204, 256; obstacles to approval, 179; Meyer-Mondell report on, 259; error of, 291. See also Food Administration Price forecasting, 137, 138. See also Outlook work Price inflation, in 1919, 21 Price stabilization: by cooperatives, 98, 103-104, 250, 252, 259; growing demand for, 179-180; plans for, 180-181; in Peek Plan, 205. See also Christopherson bill; Cooperative marketing; Price fixing Prices: wartime gains of, 19; inflation in »9«9> 37-38 Primary elections 1922, Republican reversals in, 221-230 Production, wartime levels maintained, 189-190 Production control. See Crop restriction Progressive Bloc, 234-235, 237, 245; its potential, 236; supersedes Farm Bloc, 238; growth of power, 241, 248; call for farm relief, 273; House Rules issue, 273; divided on McNary-Haugen, 279 Progressive Party of Idaho, 226 Progressives, 6, 154; conference called by La Follette.234.See also People's Lobby Prohibition, 194 Prosperity for industry, 243 Pugsley, C. W., 111, 260 Purchasing power: 1920 decline of, 41; studies of, 197-198 Purebred livestock, 38 Purnell Act, 116 Quick, Herbert, 243 Railroad rates. See Freight rates Railroads, 25, 28, 237 Railway Administration, and farmers, 28 Railway brotherhoods, 93, 219 Ralston, Samuel M., 221 Recovery, obstacles to, 281 "Relative Functions of the Departments of Agriculture and Commerce," 150 Reno, Milo, 177; on crop restriction, 89; his plan for inflation, 177-178 Republican Party, 34, 35, 221, 225, 230, 270; neglect of farmers, 119; rural discontent with, 217; internal cleavage, 233 Revenue Act of 1921, 164

INDEX Rowell, Chester H., on agrarian revolt, 229 Rural-urban friction, 23-24 Rural credits, 26, 71; 1920 stringency, 47; rural disadvantage, 52-53; for crop withholding, 56. See also Federal Farm Loan Act; Federal Reserve Board; Intermediate credits; War Finance Corporation Russia, wheat exports, 255 Russian relief: as surplus disposal, 166, 181; price influence of, 181-182 St. Lawrence waterway, 26,176; rural support for, 175-176; water and rail rates compared, 175 Sales tax, 163, 208 Samuels, J . F., 226 Sapiro, Aaron, 101, 252, 253, 254, 285; his marketing plan, 99-104, 258-259; on cooperative law, 1 1 2 - 1 1 3 ; opposes Peek plan, 216; sponsor of Cooperative Marketing Council, 240; address to Cooperative Marketing Council, 250; hostile to U. S. Grain Growers, 252; counsel for A.F.B.F., 251; opposed to NorrisSinclair bill, 274. See also "Commodity" marketing Sapiro Coöperative Marketing Law, 113, "5 Schall, T . D„ 248 Schoenfeld, William A., 137; on outlook work, 139 Seed loans, 26, 71, 171 Senate, recess blocked, 158 Senate Committee on Agriculture and Forestry, 174 Senate Finance Committee, tariff hearings, 184 Ship subsidy issue, 174-175, 237, 238 Shipstead, Henrik, 32, 223 Silver, Gray, 70, 158, 213, 252; on rural credit disadvantages, 41; on marketing reform, 96; inquiry on index numbers, 129; Farm Bloc meeting, 155; Report on Capper-Volstead bill, 169; confers with Ford on Muscle Shoals, 173; on tariff making, 185; praise for legislation, 188, 249; on wheat price decline, 255 Simpson, John A., 205 Sixty-seventh Congress: lame duck sessions, 237-241; its balance sheet, 244 Smith, B. B „ 135 Smith, Ellison D., 71-72, 172 Smith-Hughes Act, 7 Smith-Lever Act, 7

343 Smoot, Reed, on agrarian revolt, 229 Socialist Party, 220 South Dakota primary 1922, 226 Soy beans, 83 Speculators, 62, 95 Spillman, W. J., 141, 292 Stackhouse, W. H., 205-206 Standard of living, 6, 294; farm gains, 19, 41; lowered, 76-77, 283-284 Stanford Food Research Institute, 255 Statistics, USDA work, 137, 198 Stine, O. C., 135 Sugar tariff, 184, 186 Sullivan, Mark, on agrarian revolt, 229 Supreme Court, on Grain Futures Act, 159 Surpluses, 72, 180, 191, 286, 293 Swanson, Claude A., 156 Sweet, William A., 228-229 Sykes, A., 204 Tapp, Jesse W., 135 Tariff protection, 21, 186; farmer requests for, 34, 156-157, 295; in administration program, 120-121, 163; efficacy for farm products, 183, 185; influence on agriculture, 186; praised by Harding, 246; an element of farm problem, 286, 291292; obstacle to parity, 290-291. See also Emergency Tariff; Fordney bill Taxes, 40. See also Mellon, Andrew; Revenue Act of 1921; Sales tax Taylor, Alonzo E., 255 Taylor, Henry C., 131, 132, 134, 148, 213; adviser to H. C. Wallace, 130; his sympathy for farmers, 131-132; on cost of production data, 132; on economic justice, 135; on agricultural adjustment plan, 136; on economic forecasting, 137; on H. C. Wallace, 140; his report on farm-relief proposals, 140; report on Peek plan, 214; "The Agricultural Situation and the Means of Setting It Right," 262; role in developing Peek plan, 266. See also Taylor tour Taylor tour, 262, 263; influence on Peek plan, 262-263; recalled, 263 Technological efficiency, 2, 4, 18, 78-79; stimulated by crisis, 77-78; gains and losses in, 281-282. See also Farm management; Mechanization Tenancy increase, 282 Third party: movement toward, 217, 230, 235, 246, 280; an issue among progressives, 220, 232-233; prospects for, 228, 229-230, 234, 272; leadership material, 231-232; obstacles to, 234, 268; move-

344 Third party (continued) ment discredited, 247; predicted for 1924, «49;in 1924, 287-288 Thorne, Clifford, 29 Tittemore, J. N., 30 Tobacco, 49, 86 Tolley, H. R., 135 Townsend, Charles, 227 Tractors, 18, 79-80 Transportation Act of ig20, 28 True, A. C., 127 True-Howard agreement, 127 Truth in Fabrics bill, 176 Two-party system: resilience, 218; on trial, 237. See also Political parties Unemployment, 52 United Mine Workers, 219 United States Department of Agriculture. See Department of Agriculture United States Department of Commerce. See Department of Commerce United States Grain Corporation. See Grain Corporation United States Grain Growers, Inc., 105, 107, 108; organization campaign, 108109; opposed by grain trade, 109-110; high salaries paid, 110; internal friction, 110; liquidation of, 111; plan to recreate, 252. See also Committee of Seventeen Volstead cooperative bill, 27 Vrooman, Carl, 160 Wallaces? Farmer, 45, 263; favors seasonal crop holding, 66; campaign for corn reduction, 86-87; defends farm tariff, 186; on dangers of rural decay, 189; on price disparity, 199; on Peek plan development, 265; on Coolidge policy, 269 Wallace, Henry A.: proposes Joseph Plan, 67; his Agricultural Prices, 67, 210; on crop restriction, 86, 87, 89; plans for Outlook Conference, 137; for managed currency, 178; pioneer in price statistics, 198, 199; on Peek plan, 211; aids McNary-Haugen movement, 276 Wallace, Henry C., 123-124, 163, 167, 258; 270; in 1920 Republican campaign, 34, 35; on freight-rate problem, 59-60; on agriculture as fundamental, 61; on agricultural cooperation, 92,105-106,116; and W. G. Harding, 120, 129; his political services, 123; as Secretary of Agriculture, 123, 124, 126, 127, 128, 239; plan for national farm policy, 124; his

INDEX farm policies, 124-125, 130, 140, 151, 261; annual reports, 126, 140; letters to and from farmers, 128; criticism of, 128129; Our Debt and Duty to the Farmer, 130, 151; on creation of BAE, 130, 134; criticism of price fixing, 130, 179; on agricultural economics study, 133; on farmers' university, 133; on agricultural adjustment, 135-136; conflict with Hoover, 141-151; on executive reorganization issue, 143-146; on encroachments by Department of Commerce, 146, 150, 151; on export market, 147; proposes interdepartmental cooperation, 147; declining influence of, 149150, 261, 280; on Ketcham bill, 150; death, 151; apprized of farm lobby, 153; on WFC, 160; on Norris export bill, 160; his evaluation of Farm Bloc, 164; on Ladd-Sindair bill, 181; favors tariff protection, 184; on farm crisis, 190-191, 281; on foreclosure incident, 195; his concern with disparity, 198, 291, 215; on burning corn, 201; and National Agricultural Conference, 202, 203, 204; and Peek plan, 213, 214, 260, 261; on production adjustment, 257; " T h e Wheat Situation," 263-265; argues for surplus disposal plan, 266; relations with Coolidge, 265, 267, 269; on farm board plan, 271; opposed to Norris-Sinclair bill, 274; attack on by B. C. Marsh, 274; aids McNary-Haugen movement, 276-277; testimony on McNary-Haugen bill, 277; on farm management, 285; on American Council of Agriculture, 288; on national self-sufficiency, 292 Walton, J. C., 226-227 Wannamaker, J. S., 36, 55, 195 War Finance Corporation: export work of, 22, 161; suspended, 47, 53; renewal issue, 55, 71-72; credit for cooperatives, 115; Harding view of, 121; plan to expand, 159, 161, 162; farm credit relief, 195; machinery for loans, 196; evaluation of work, 196; farm complaints of, 196-197. See also Intermediate credit; Meyer, Eugene War Industries Board, 18 Warehouse receipts, WFC loans on, 115 Warehouses. See Federal Warehouse Act Warehousing, Edison plan, 178 Warren, George F., 135; urges farm organization, 23; favors crop holding, 68; and F. A. Pearson's Agricultural Situation, 97; his contribution to parity con-

INDEX

cept, 200; his statistics used by Peek, 212; report on Peek plan, 214; on farm board plan, 271 Washington primary 1922, 227 Watson, James £., 244 Webb-Pomerene Act, 211 Weeks, John W „ 123, 173 Wefald, Knud, 257 Weinstock, Harris: Director of California State Market Commission, 99; on prohibition, 194 Wheat: World War I demand, n ; wartime price control, 15; production, 15, 36, 255; end of government control, 44; price declines, 51, 62, 251-252, 254-255; embargo proposed against Canadian wheat, 63; price investigation by Federal Trade Commission, 63; crop restriction, 88; Outlook Conference report, 138; cooperative marketing of, 251; crop holding plan, 257; H. C. Wallace investigation of, 263-264; 1924 price gains, 280. See also Grain Corporation; Grain Marketing Company; National Wheat Conference; United States Grain Growers Wheat Council of the United States, 256 Wheat Growers' Advisory Committee, 252. 259 Wheat pools, 42-43, 66, 101, 251. See also National Wheat Growers' Association Wheat price fixing, 13, 22-23, 241 Wheat tariff, controversy on, 186-187

345 Wheeler, Burton K., 227, 235 White, William A., on 1922 election, 228 Williams, A. B., 271 Williams, Carl, 258 Williams farm board bill, 271 Williams, John Skelton, 56-57 Wilson, M. L., 135; on crop restriction, 141, 292 Wilson, Thomas, 213 Wilson, Woodrow, 7, 39-40, 63; requests Congress for food control, 12; on farmers in wartime, 17; vetoes WFC renewal, 72; vetoes Emergency Tariff, 74, 191; loss of farmer loyalty, 30 Wine bricks, 194 Winslow bill, 149, 150, 270 Wisconsin primary 1922, 225-226 Wisconsin Society of Equity, 91 Woodruff, Roy O., 245 Wool: price declines, 48; tariff duties, 184, 186 Workers' Party, 246 World War I: effect on agriculture, 1, 1011, 18; food shortages, 11-12. See also Food Administration; Hoover, Herbert C.; Lever Food Control Act Yearbooks of Department of Agriculture, 125, 126 Yoakum, B. F., 248-249 Yohe, H. S., on Meyer-Mondell mission, 258. 259 Young, G. M., on crop restriction, 89, 90 Young Plan, 286