Westward expansion: economic development

Farmers in an industrial age

The industrial innovation of the Gilded Age also revolutionized farming. New machinery, such as the combine (combined reaper-thresher) and tractor, increased harvest yields and decreased the amount of labor needed to produce them.

This new productivity thrust farmers into a competitive worldwide market. American farmers concentrated on growing a single cash crop (usually corn or wheat in the West). When crop prices were high, the farmers profited. When prices dropped, they went into debt.

In the late nineteenth century, farmers became the victims of their own success: overproduction drove prices down. Farmers were also faced with unfavorable government policies, such as high protective tariffs and a deflationary monetary policy, both of which favored industry over agriculture. Railroad monopolies set shipping rates so high that some farmers chose to burn their crops rather than pay to ship them to market. Farm machinery and fertilizer were also expensive. Many small farmers lost their farms to the banks.

The Grange and the Farmers’ Alliance

Much like factory workers joining labor unions, farmers began to form cooperative organizations. One such organization, commonly called the Grange, called for increased government regulation of railroads and cooperative buying and selling of equipment and crops.

In the late 1870s, the Farmers’ Alliance established “exchanges” to provide financial services such as loans and selling crops. It also lobbied for the federal government to loan money to farmers at low interest rates and create warehouses to store their crops. Neither group succeeded in creating long-term economic change for farmers.

Source: Westward expansion: economic development
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