Surviving loneliness, drudgery, and the weather still did not guarantee financial success for homesteaders. In fact, the economic realities of farming on the plains proved formidable. Despite the image of yeomen farmers—individuals engaged in subsistence farming with the aid of wives and children—most agriculture was geared to commercial transactions. Few farmers were inde-pendent or self-reliant. Farmers depended on barter and short-term credit. They borrowed from banks to purchase the additional land necessary to make agri-culture economically feasible in the semiarid climate. They also needed loans to buy machinery to help increase production and to sustain their families while they waited for the harvest.
Instead of raising crops solely for their own use, farmers concentrated on the cash crops of corn and wheat. The price of these commodities depended on the impersonal economic forces of an international market that connected American farmers to growers and consumers throughout the world. When supply expanded and demand remained relatively stable during the 1880s and 1890s, prices fell. This deflation made it more difficult for farmers to pay back their loans, and banks moved to foreclose. Corn growers had a hedge against falling prices. By withholding some of their corn from market, they could feed it to their hogs, fatten them up, and sell them at higher prices. The reduction in the supply of corn caused prices to rise until it was worth selling corn again.
This “corn-hog cycle,” however, did not benefit wheat growers. When prices plummeted, they had little choice but to raise more wheat in the hope that increased volume would yield more income. Instead, the expansion in supply, coming as it did from so many farmers, merely depressed prices further, leaving wheat farmers with debts they could not repay. Under these circumstances, almost half of the homesteaders in the Great Plains picked up and moved either to another farm or to a nearby city. Large operators bought up the farms they left behind and ran them like big businesses. As had been the case in mining and ranching, western agriculture was increasingly commercialized and consolidated over the course of the second half of the nineteenth century.
The federal government unwittingly aided this process of commercialization and consolidation, to the benefit of large companies. The government sought to make bigger plots of land available in regions where small farming had proven impractical. The Desert Land Act (1877) offered 640 acres to settlers who would irrigate the land, but it brought small relief for farmers because the land was too dry. These properties soon fell out of the hands of homesteaders and into those of cattle ranchers. The Timber and Stone Act (1878) allowed homesteaders to buy 160 acres of forestland at $2.50 an acre. Lumber companies hired “dummy entrymen” to file claims and then quickly transferred the titles and added the parcels to their growing tracts of woodland.
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How did market forces contribute to the boom and bust of the cattle ranching industry? |
How did women homesteaders on the Great Plains in the late nineteenth century respond to frontier challenges? |