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Felix Morrow

The Role of Roosevelt

Did Roosevelt Solve
the Agricultural Crisis in America?

(12 May 1945)

Source: The Militant, Vol. IX No. 19, 12 May 1945, p. 4.
Transcription/Editing/HTML Markup: 2018 by Einde O’Callaghan.
Copyleft: Felix Morrow Internet Archive (www.marx.org) 2018. Permission is granted to copy and/or distribute this document under the terms of the Creative Commons Attribution-ShareAlike 2.0.

The Democratic platform for 1932 denounced Hoover for the “unsound policy of restricting production” in agriculture. And on page 79 of Volume I of Roosevelt’s public papers, we read how in the 1932 campaign he branded Hoover’s secretary of agriculture “who invented the cruel joke of calling on the farmers to allow 20 per cent of their wheat lands to lie idle, to plow up every third row of cotton and shoot every tenth cow.”

It is history now that, whereas Hoover merely called on the farmers to do so, Roosevelt had laws passed under which six million pigs were killed in September 1933, every fourth row of cotton plowed under, and so on. In the following years the destruction was less dramatic but equally extensive. In an address of January 10, 1936 Secretary of Agriculture Wallace stated that the AAA had taken 36 million acres out of production in 1934 and 30 million in 1935, and that his objective was to take out of production 50 million acres. This, while the Administration itself conceded that a third of the nation was ill-clad, ill-fed, ill-housed.

It could easily be demonstrated that all the principal ingredients of Roosevelt’s farm program served the interests of the big farm owners, including the banks and insurance companies. (One out of every four farms had been sold for debts or taxes between 1929 and 1933.) AAA-crop reduction was supported chiefly by larger farmers who produced staples like wheat and cotton, whereas the diversified-crop farmers and tenants gained nothing by it. The latter, represented by the National Farmers Union and the Farmers National Holiday Association, held conventions which unanimously condemned the Agricultural Adjustment Bill while it was pending.

Above all the smaller farmers wanted to stop farm mortgage foreclosures – and did. Crowds of farmers forced sheriffs to accept bids of a dollar or two at foreclosure auctions, and then turned the farms back to their original owners.

When an Iowa judge refused to promise a crowd of farmers that he would sign no more foreclosures, he was dragged from his courtroom and hanged until unconscious. States under such pressure passed mortgage moratorium laws.
 

Measures to Bail Out the Banks

It was under these conditions, in an attempt to soften the hostility of the small farmers against the pending farm bill, that Roosevelt sent Congress a special message on May 4, 1933, which resulted in adding an amendment providing that farm mortgages would be refinanced at low interest rates by the government.

In this case, too, however, the ultimate beneficiary proved to be not the small farmer but the parasites who lived off him. Federal refinancing served mainly to bail out banks and insurance companies from unprofitable mortgages. This is the fact behind the report, in the Dec. 13, 1935 New York Times, that among Roosevelt’s followers in the South “are the investment bankers, the mortgage lenders and crop financiers ... In this class of bankers are to be found the most ardent supporters of President Roosevelt. Their enthusiasm surpasses that of the farmers.”

Nevertheless, the small farmer did manage to get some measure of mortgage relief. This was one of the three classical demands of the farmers ever since the 1880’s. But he got no relief at all on his other two demands: against high freight rates and high prices (relative to farm prices) for tariff-protected manufactured goods.

But even had the Roosevelt administration provided some relief on these demands, it would have not gone far to ease the plight of the farmer. The classical demands of the farmer had a real meaning when he was selling his product in the export and domestic market, and was objecting to being milked of his proceeds by the manufacturing and railroad monopolies. But what was now taking place was a permanent collapse of the farmer’s former markets. That is why the parasites who have milked the farmer now turned more and more to milking the U.S. Treasury.
 

Decline of American Farming

The central fact to understand about farming is that its decline dates not from 1932 but from 1920. The present war and immediate postwar market are merely an interlude in the long process of the permanent collapse of American agriculture. A few figures will demonstrate this graphically, and incidentally explode the New Deal claim of having solved the farm crisis. Here is what has happened to gross farm income since 1920:

America was once the greatest granary in the world. But look what happened to cash income from bread grains (in millions):

What has been the effect on the value of farm property? Here is the average value per acre (in dollars):

Reducing Farmers to Peasants

These figures irrefutably demonstrate the permanent character of the decline of American agriculture. They mean that a growing percentage of American farmers are no longer really farmers in the traditional American sense, which has meant commercial farming – cash crops, the ability to buy most of what they eat and wear, etc. In 1938 Wallace admitted that “The commercial farmers comprise only about fifty percent of the farm population but they supply about ninety percent of the farm products which move to markets.” The other fifty percent have been reduced to peasants, who “consume ninety percent of what they produce and buy only ten percent of what they consume.”

The grim meaning of this is indicated by the figures of the 1940 census. One out of every five farms had a gross annual income of less than $250 in 1939; two-thirds of the farms had gross annual incomes of less than $1,000. After six years of the New Deal farm program, there were three times as many farms with an annual income under $250 as in 1929; almost twice as many with incomes between $250 and $399, and the number of farms bringing their operators $600 or less annually increased from 28 per cent in 1929 to 47 per cent in 1939. In a word, the period of the New Deal was one of transforming more and more farmers into peasants.

How did this happen? The thing to understand is that the heyday of American commercial farming was due to two basic factors which have now disappeared:

1. The European market of 1850–1900. England's abolition of the corn laws in 1845 meant in effect the abandonment of English agriculture and its replacement by American imports. The expanding American frontier became the granary of England and of western Europe. The debt-ridden and old agricultural lands of England, Germany and France could not hope to compete with the fresh homesteads of America. English and other European capital and machinery were imported to industralize America, and were paid for by agricultural exports; Thus the American farmer in effect financed the rise of monopoly capital.

Just as the new lands of America had pushed aside European agriculture, so, in the 1880’s and 1890’s, the opening of new grasslands to grains and meatstuffs in Canada, Australia, Argentina, India, Russia, began to push aside the American farmer. In addition to these new competitors, there began in Europe import restrictions on American meats, as the European nations, preparing for the next war, began to bolster home agriculture. The American farmer lost his supremacy in the world market.
 

The Loss of Markets

2. The expanding home market of 1900–1920. At this point, however, the American home market took up the slack. For this was the point at which, having laid the foundations with capital borrowed from Europe, American industry began its speediest period of expansion. It was the great period of immigration. Whereas earlier immigration had been to the lands opening in the West, now it was immigration which filled the American cities. It was in this constantly expanding city population that, from 1900–1915, American agriculture found its market. The war and postwar years until 1920 were likewise profitable.

Then, after 1920, came the collapse which never ceased. Immigration was ended, and a lower birthrate also served to restrict the size of the domestic market. Simultaneously the use of machinery and better farming and livestock technique sharply increased the output. In agriculture, as in industry, increased productivity meant disaster for the masses of producers. America’s emergence as the chief creditor nation meant permanent collapse for American agriculture. Nothing that Roosevelt would or could do served to change this. The only longtime “solution” he offered the impoverished farmer was government help in learning how to run his farm as a subsistence homestead; i.e., how to live as a peasant almost entirely outside of and divorced from the benefits of modern technology.

(This is the third of a series of articles on Roosevelt’s role. The fourth will appear next week.)

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