1920s Farmer's Economic Crisis

During World War I U.S. farmers were seeing major success due to the constant need of food to in Europe. In the 1920s the United States economy, after World War I and powering through a postwar deflation, began to boom. The Roaring Twenties had begun and by the end of the decade the United States was the leading producer for industrial goods. However, once European countries began growing again, prices of produce, especially wheat began to plummet creating a depression for agriculture. In order to counter the plummeting prices farmers began planting and harvesting more and more with the help of new agricultural technologies. In 1931 the stock market crashed and with it, so did the price of wheat, marking the beginning of the Great Depression.

Wheat prices was not the only economic hit to farmers, banks began to close and families were unable to retrieve their money, “In 1930. 1,350 banks failed, going under with $853 million in deposits. The next year, 2,294 banks went bust” (Egan 95). The economic crisis was not exclusively affecting farmers, but touched every corner of the United States. In 1931 The Bank of the United States fell causing twenty-five percent of the work force lost their jobs, which is the largest layoff in U.S. history (Egan). The federal government began trying to correct the market beginning with the election of Franklin D. Roosevelt in 1932. The day after his inauguration in 1933, Roosevelt closed the banks for a few hours and through unanimous vote passed the Emergency Banking Relief Bill. He was able to convince U.S. citizens to deposit their money back into the banks, which resulted in a resounding success. This was the beginning of the New Deal. The federal government was taking a role it had never taken before. With the creation of the National Industrial Recovery Act and the Agricultural Adjustment Act the federal government was trying to balance out the economy and get money flowing again. In order to counter overproduction the Agricultural Adjustment Act “offered subsidies to farmers who agreed to limit production of specific crops” (641). This helped to lower the

This drop in wheat prices was partly due to the restoration of the European agriculture market, “foreign competitors dumped agricultural surpluses into the global market” (634). In the U.S., farmers began to adjust for the falling wheat prices by increasing the amount of production. New technologies made it easier to farm much larger plots of land, which lead to an expansion of the amount of plowed land, “seventy-five million acres of native grasses was turned into land for farming wheat” (Black Blizzard). This major increase in growing and harvesting wheat added to the already large surplus, which continued to cause wheat prices to drop, “By 1932, a bushel of wheat that cost North Dakota farmers 77 cents to produce brought only 33 cents” (634). Farms were being auctioned off regularly, because farmers were unable to pay their taxes. Families began losing their homes and were forced to move