Although farmers had faced a shortage of capital, banking facilities, currency, and credit during the last two decades of the 19th century, the new century brought a wave of prosperity to rural areas of the United States that would last until shortly after the end of World War I. Despite experiencing substantial wartime prosperity, the agricultural economy by the 1920s displayed clear signs of the structural weaknesses that would prove ruinous for many farmers. Nevertheless, during the “Golden Age” of agriculture from 1900 to 1920, gross farm incomes doubled and real farm income (gross income adjusted for inflation) increased by some 40 percent. Beyond the yearly increases in income, the real growth in the prosperity of farmers came with steadily increasing land values, holding out the promise of future economic well-being.
The prosperity that farmers experienced during the first two decades of the 20th century largely emanated from increasing demand for their products. While the amount of land under agricultural production more than doubled in the last quarter of the 19th century, only about 12 percent more land was brought into production between 1900 and the early 1920s. Not only had the majority of productive farmland already been brought into production by 1900, but also farmers tended to not increase their landholdings during that time.
An important source of rural prosperity stemmed from foreign markets, where farmers increasingly sold a new, wider range of products between 1900 and the First World War. As farmers steadily pushed into the few remaining productive agriculture lands, in places like Florida and California, the range of agricultural commodities shifted. By 1914, citrus fruits, sugar, oil crops, poultry, and eggs had made steady gains as major agricultural commodities American farmers produced. Despite this shift in the type of products being grown, hay, grains, wool, and meat animals remained key components in the agricultural economy. Technological improvements aided the rapidly growing agricultural economy and led to the introduction of new commodities. Not only mechanization on individual farms, especially the introduction of the internal combustion engine, but also the introduction and expansion of new containers, such as refrigerated railway cars, made the transport of perishable goods easier and more efficient. The citrus fruit industry, for example, expanded as its products could be transported and sold on a national market as opposed to simply within local markets in California and Florida.
Although willing to introduce many modern conveniences to their daily living conditions, many farmers— having witnessed the economic difficulties of the late 19th century—were reluctant to invest in capital improvements. They hesitated to expand landholdings and purchase new equipment to increase farm productivity. As a result, with productivity increasing by only about 1 percent per year, agricultural output could not keep pace with the steady increase (approximately 40 percent) in the nation’s popula-
Poster featuring Uncle Sam as an advocate for gardening, 1917 (Library of Congress)
Tion during the first quarter of the 20th century. Accordingly, the prices of agricultural commodities rose because of an increasing demand that could not be fully met by American farmers. In addition, the world market also became quite friendly to American farmers between 1900 and 1920, which added to their profits. In particular, American agricultural commodities were in high demand across Europe with the outbreak of war in 1914.
Despite the reluctance of farmers to invest in extensive capital improvements, the introduction of mechanical farm equipment had dramatic and long-term consequences on American society, especially in the South. There, even the limited introduction of mechanization resulted in a slowly decreasing demand for African-American laborers, who had made up the bulk of the rural labor force through tenant and sharecropping arrangements. Although cotton remained the least mechanized farm crop through the 1930s, the gradual introduction of mechanical devices helped to loosen some of the economic and political conditions that tied African Americans to the region. In addition to mechanical devices, the infestation of cotton by the boll weevil in the early part of the 20th century meant that for the first time since the end of the Civil War in 1865, a steady number of African Americans managed to migrate to northern cities, especially as the demand for industrial labor increased with the start of the war in Europe.
The war had created an expanded market for American agricultural goods and brought the means to borrow capital for expanding landholdings, but the cessation of hostilities in Europe caused the market to contract. Agricultural endeavors on the continent resumed, and European governments faced a capital shortage as they rebuilt their war-torn nations. With shifting market conditions during the 1920s, agricultural prices in the United States steadily declined. In 1919, wheat sold for $2.19 per bushel, potatoes went for $2.20 per hundredweight, and cotton received $.35 per pound. By the end of the 1920s, however, a bushel of wheat sold for $1.05, potatoes had declined to $1.29, and cotton now received only $.17. While lower prices for
Many consumer goods resulted in increased demand, most people did not purchase more bread as its price dropped.
Not only did farmers have to contend with declining prices for many of their commodities, but also changing consumer tastes and new federal policies had a profound impact on agriculture. The passage of Prohibition in 1919 barred the sale and manufacture of alcoholic beverages and, accordingly, constricted the domestic market for barley and other grains. Similarly, shorter skirt styles and the introduction of such synthetic materials as rayon diminished the demand for cotton and wool. Another major factor that reshaped agriculture was the introduction of tractors to the production process, primarily in harvesting. While mechanization was a response to the shortage of labor, it ultimately meant fewer draft animals were needed by farmers, which further reduced the demand for various field crops traditionally used to feed work animals.
With declining prices and constricting markets, many rural residents and farmers faced an economic downturn well before the onset of the Great Depression in 1929. Some 500,000 individuals lost their farms to bankruptcy during the 1920s. In response, farmers made persistent demands for relief from the federal government during the course of the twenties. Farm advocates had long championed the need for low-interest loans to help promote and make affordable the capital improvements needed to expand individual farms. The Federal Farm Loan Act in 1916 created the mechanism to extend low-interest loans for periods of five to 40 years to farmers through a Federal Farm Loan Board, 12 Federal Land Banks that paralleled the Federal Reserve Banks. As part of Woodrow Wilson’s New Freedom initiative, the Farm Loan Act extended capital to farmers through a program that cut out private banks, which farmers viewed as outside institutions that exploited them.
Another mechanism introduced during the early part of the 20th century to address the needs and demands of agriculture was federal support for cooperative arrangements, which actually was one of the more favored responses long advocated by farmers. If farmers could buy, sell, and process through joint efforts, they would be able to better control the profits generated by their products. Cooperative arrangements did not stand to benefit all farmers. Instead, producers of perishable products and of items that sold on a national rather than a world market tended to benefit the most from cooperative arrangements. Some of the more successful cooperative arrangements were made in the fruit and dairy sector of agriculture and included such cooperatives as Sunkist oranges, Land O’Lakes milk, Diamond walnuts, and Ocean Spray cranberries. In 1922, the Farm Bloc in Congress passed the Capper-Volstead Act, which protected cooperatives from antitrust legislation.
Another major piece of farm legislation was the Agricultural Marketing Act (1929). It created a revolving loan fund of $500 million to help farm cooperatives market their major commodities and to purchase surpluses of-goods off the market to force prices up. While this legislation stood to benefit a key part of the agricultural economy, it is unknown what its benefits might have been for producers after 1929. While industrial operations in the United States had benefited from protective tariffs, the prices of agricultural goods could not be pushed by these tariffs, especially as production outdistanced demand on the domestic market. In response to the demands of such groups as the American Farm Bureau, Congress in 1926 passed the McNary-Haugen Farm Bill in an attempt to create parity for American agricultural goods. While Congress twice passed the bill, it was unable to override President Calvin Coolidge’s vetoes. Despite government efforts to address farmers’ needs, the agricultural sector quickly fell into economic crisis with the collapse of the Stock Market in 1929.
See also economy; tariees.
Further reading: David B. Danbom, Born in the Country: A History of Rural America (Baltimore: Johns Hopkins University Press, 1995); Pete Daniels, Breaking the Land: The Transformation of Cotton, Tobacco, and Rice Cultures since 1880 (Urbana: University of Illinois Press, 1985).
—David R. Smith
Aguinaldo, Emilio (1869-1964) rebel Emilio Aguinaldo was the Filipino statesman and guerrilla leader who led the nationalist revolt against the American forces during the Filipino Insurrection (1898-1902). The son of the mayor of the town of Kawit, he assumed his father’s position after achieving financial success running his family’s sugar mill and dealing in cattle. While mayor, he became enamored of the Katipunan, a secret, mystical nationalist organization that combined the rituals of Roman Catholicism and Freemasonry. When the Filipinos rose up against Spanish colonial rule in August 1896, Agui-naldo joined the rebels and quickly distinguished himself as a guerrilla leader. Armed only with the most primitive of weapons, he and his followers managed to control three towns in his native province of Cavite.
Inspiring and resourceful as he was, Aguinaldo eventually was cornered by Spanish forces. With the Spanish unable to muster the resources necessary to storm his camp, and the nationalists unable to break out, the two sides came to a settlement. The Spanish promised reforms, and Aguinaldo agreed to accept 800,000 pesos, sign an oath foreswearing rebellion, and leave the country.
In December 1897, Aguinaldo arrived in Hong Kong, immediately renounced his agreement with Spain, and began to plan a new rebellion. His efforts were given a boost a year later, when Admiral Dewey’s fleet was assembling at Hong Kong in preparation for an attack on Manila Bay. Although Dewey asked Aguinaldo to help him defeat the Spanish, the admiral inexplicably sailed to Manila without him. Aguinaldo, who had made alternate travel arrangements, did not arrive until the naval battle was over.
Unable to get a firm answer from Dewey concerning Filipino independence, Aguinaldo declared the Philippines a provisional dictatorship with himself as its head. As his presence in the archipelago became known, Filipinos flocked to his cause. The nationalists soon surrounded Manila, effectively blocking the Spanish from leaving by land while Dewey blocked the routes to the sea.
When American ground forces arrived, they promised the Filipinos several artillery pieces if they would yield a sector of Manila. Aguinaldo agreed, and his troops left their trenches, but the cannons were never delivered. The Americans promptly stormed the city; and in a sham battle, designed to save the Spanish general from court-martial, they captured all of the Spanish troops. As a final insult, Aguinaldo was barred from the surrender ceremony.
Aguinaldo sent his troops to cover as much territory as possible so as to increase his leverage with the Americans. Tensions mounted between Filipino and American troops as they faced each other in the trenches around Manila. Once President William McKinley declared that the United States had sovereignty over the islands, Aguinaldo prepared for war.
Open hostilities began when an American private shot and killed several Filipino soldiers. Fearing that the Filipinos were within American lines, the commander ordered his troops to attack. In the open, pitched battles that followed, the Filipinos were decimated with casualties. Agui-naldo responded by quickly switching over to hit-and-run tactics. His guerrilla war and terrorist activities frustrated U. S. efforts to pacify the islands for the next three years.
The insurrection came to an end in 1902 when, in a daring raid by American troops, Aguinaldo was captured. He signed a document stating that he recognized American sovereignty, and he ceased hostilities. He lived quietly for the remainder of his life, except during World War II when he made pro-Japanese broadcasts. He died in 1964.
Further reading: Stanley Karnouw, In Our Image: America's Empire in the Philippines (New York: Random House, 1989).
—Timothy E. Vislocky
Alien Exclusion Act See Immigration Act of 1917.
World History
