Farms and the economy - History

Farms and the economy - History

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Life on the Farm

American farmers were incredibly productive during this period. In the 1880s, only 15% of the land area of the United States was cultivated, but it is estimated that American farmers produced 30% of the grains of the world. The US was a vast exporter of farm products. In 1885, the US produced 500,000,000 bushels of wheat — of which Britain imported $175,000,000 worth of them. Their very success, however, created tremendous problems for farmers. At the heart of the problem was the fact that the yearly value of acre of the ten main crops dropped from $14.71 in 1870, to $9.71 in 1893. As a result many famers were forced into debt and were forced to mortgaged their farms. The end result was the slow, but steady, movement of farmers off the farm and into the cities. In the process many farmers became radicalized and supported populist candidates for political office.

Dust Bowl

The Dust Bowl was the name given to the drought-stricken Southern Plains region of the United States, which suffered severe dust storms during a dry period in the 1930s. As high winds and choking dust swept the region from Texas to Nebraska, people and livestock were killed and crops failed across the entire region. The Dust Bowl intensified the crushing economic impacts of the Great Depression and drove many farming families on a desperate migration in search of work and better living conditions.

During the 1980s farm crisis, Minnesota lost more than 10,000 farms

By 1982, 49 percent of the 11,000 farmers in Minnesota with Farmers Home Administration (FmHA) loans were in delinquency, and more than 300 farms faced foreclosure.

Minnesota’s farmers enjoyed an economic boom in the 1970s. Land values soared, United States exports of agricultural products grew, and farmers gained access to easy credit to expand their operations. When the 1980s brought a sharp decline in exports and land values, rising production costs, and higher interest rates on loans, many farmers found themselves in serious financial trouble. The farm crisis of the 1980s caused many farm foreclosures and bankruptcies—the worst economic conditions the agricultural sector had seen since the Great Depression.

Several factors contributed to the farm crisis of the 1980s. Minnesota’s net farm income rose to nearly $2.25 billion in 1973, a more than 130 percent increase over the previous year. Land values in Minnesota grew nearly 30 percent from $898 per acre in 1978 to $1,165 by 1982, making many farmers millionaires on paper. A weak US dollar, combined with severe drought conditions around the world, caused a large increase in US exports of agricultural products. The federal government encouraged farmers to increase production to meet the demand.

Expecting the booming economy to continue, farmers flocked to banks to accept offers of easy credit to buy more land and equipment. As a result, many found themselves overextended when the economy went into recession at the end of the decade.

In the early 1980s, exports flagged due to a strengthening US dollar, recovering agriculture abroad, and a grain embargo imposed against the Soviet Union. Land values and prices for farm products fell, while production costs continued to rise. The average value of farmland per acre in Minnesota fell nearly 40 percent from $1,165 in 1982 to $700 in 1987. Jackson County farmers experienced the sharpest decrease in land values in Minnesota during this period, with prices falling nearly 54 percent, from $1,991 to $921 per acre. The average value of machinery and equipment on all Minnesota farms increased nearly 25 percent from 1978 to 1982. Farmers also faced increasing fuel, fertilizer, and other input costs.

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By 1984, Minnesota farms carried nearly $12 billion in debt. Interest payments added another $1.5 billion. By 1987, Commodity Credit Corporation loans alone totaled more than $810 million.

Prices for commodities and net farm income fell as farmers received a smaller percentage of what consumers paid for their products. Minnesota’s total net farm income fell 58 percent, from just over $1.2 billion in 1981 to less than $500 million in 1983. By 1986, in spite of government programs providing price supports and income subsidies, farm prices had fallen to just 51 percent of parity (the purchasing power of a commodity compared to its purchasing power during America’s “Golden Age” of agriculture, 1909–1914). It was the lowest percentage since the Great Depression. In an attempt to offset bad debt, some lenders raised interest rates by more than 20 percent by 1982. Farmers’ lower net incomes couldn’t keep pace with the rising cost of debt repayment, causing many to fail.

Government subsidies to farmers helped somewhat to offset losses in net income. In 1987 nearly 49,000 Minnesota farms received payments totaling $712.8 million. Government payments increasingly depended on compliance with new conservation measures for farmland use.

Some farmers resorted to selling off land or machinery to pay down the principal so the lender would extend the loan or lower the interest rate. Selling assets, however, could impact neighboring farms by lowering adjacent land values. Even with these options, thousands of farmers defaulted on their loans and faced bankruptcy or foreclosure.

By 1982, 49 percent of the 11,000 farmers in Minnesota with Farmers Home Administration (FmHA) loans were in delinquency, and more than 300 farms faced foreclosure. In 1983, in response to high unemployment and the poor farm economy, the state legislature passed a moratorium on mortgage foreclosure and contracts for deed termination similar to the Agricultural Adjustment Act of 1933, then extended it in 1984. The law required sixty days’ notice of a contract for deed or default on a mortgage, and eight weeks’ notice on foreclosures to give the mortgage holder time to remedy the situation. The following November, 250,000 farmers nationwide brought a class-action suit against the FmHA resulting in a suspension of farm foreclosures until a loan deferment program could be approved. This granted farmers the right to mediation in liquidation proceedings.

The Minnesota Department of Agriculture launched the Farm Advocate Program in the spring of 1984. The program offers free financial and legal counseling to farmers dealing with debt and provides emotional support to families in crisis. In the first six weeks, thirty-five advocates assisted 550 farm families.

Farm protests gained momentum. A 1984 bank protest in Paynesville supported by Citizens Organized Acting Together (COACT) prompted the start of Groundswell, a grassroots farm movement. On January 21, 1985, organizers held a rally that brought an estimated 10,000 people to the state capitol to call attention to the farm crisis. Demands included state-guaranteed operating loans, a 120-day moratorium on farm foreclosures, and fair prices for farm products. As a result, the legislature ordered a report on farm finances and appropriated money for farm business education and other assistance programs.

In 1986, Congress passed the Family Farmer Bankruptcy Act (Chapter 12 bankruptcy) as a way to keep families on their farms. The act provided the options of reducing debt and interest rates, and lengthening the repayment period. That same year, the state’s Agricultural Extension Service began to provide mediation to assist farmers in meetings with creditors, which saved some farms. Nationwide, 9,556 farmers filed for Chapter 12 bankruptcy in the 1980s. Minnesota bankruptcies totaled more than 600 in 1987, but dropped to 230 the following year as the economy began to improve.

The number of farms in Minnesota decreased from 98,671 in 1978 to 85,079 in 1987. While some fell victim to poor financial management, others were lost due to a lack of good jobs available off the farm to subsidize household income, and to the retirement of an aging generation of farmers.

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For families losing their farms, it meant not only the loss of their livelihood, but of their preferred way of life. For those with a long history on the farm, it ended the tradition of passing the farm on to the next generation. The emotional toll led to depression and, in severe cases, suicide.

As farms were lost, the average size of surviving farms grew. Owners of corporate farms began to take over more acreage. In spite of state laws designed to protect family farms, non-farmers owned 28 percent of all Minnesota farms by 1982. Farmers and local lenders resented outside investors, many of whom were absentee landlords.

The farm crisis of the 1980s claimed other victims. Small town bankers faced the difficulty of having to call in loans, go through debt mediation, and foreclose on friends and neighbors. Agricultural suppliers lost customers. Main street businesses in rural communities suffered as farm families had less expendable income. Rural communities were faced with the challenge of luring non-agricultural industries to town to bolster their sagging economies.

Although the farm economy began to recover in the late 1980s, the number of Minnesota farms is still in decline (down from 85,079 farms in 1987 to 74,542 reported in 2012), and farmers continue to face serious economic challenges in the twenty-first century.

For more information on this topic, check out the original entry on MNopedia.

Linda A. Cameron

Linda A. Cameron is the program manager for the MNopedia project at the Minnesota Historical Society. She received the Theodore C. Blegen award for the best staff-written article in Minnesota History (2010). Her projects with the Minnesota Historical Society include research and web editing for the Minnesota’s Greatest Generation and Becoming Minnesotan projects, and educational program development for historic sites and museums.

What one farmer learned from surviving the 󈨔s farm crisis


Some basic economic forces are driving mid-sized farms out of existence. First, food prices keep falling. “Ever since World War II, agricultural commodities have trended steadily down,” agricultural economist Otto Doering told me. We are on a technology treadmill: Farmers get a new tech (like hybrid seeds), increase productivity, and make money. But then all the farmers get it, they all produce more, and prices drop, Doering said. Those new technologies cost money, so farm costs go up while food prices fall, leaving farmers with smaller and smaller profit from every bushel they harvest.

Farmers can either buy land and get bigger, drop out, or get an off-farm job to supplement their income. Forty years ago, when Doering came to Purdue University, 800 to 1,000 acres could give a farmer in Indiana a good middle-class income. Now, it takes 2,000 to 3,000 acres to support a commodity farmer, he said.

You can spin this positively: Technology is making farmers better, and allowing them to grow the same food at much lower prices — in the same way we celebrate Moore’s Law or the falling price of solar panels, there’s a lot of good in this. But it also means that people are pushed out of farming, especially in periods of crisis. And that’s often incredibly painful.

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Harvest Public Media has given us permission to republish this piece by Amy Mayer about the great farm crisis of the 1980s. When I heard it, I wanted to share it here as a reminder that there is a human cost to change. It’s a powerful thing to listen to Mark Kenney’s voice — even though he’s not giving specific details — and realize that years later it’s still hard for him to even mention that period without choking up. (See also Liz Core’s interview with Kenney here.)

The fifth generation to run his family farm, Mark Kenney says the 󈨔s farm crisis taught him lessons for today. Amy Mayer/Harvest Public Media

This post is part of My Farm Roots, Harvest Public Media’s series chronicling Americans’ connection to the land. Click here to explore more My Farm Roots stories and to share your own.

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I met Mark Kenney on his family’s farm in Nevada, Iowa, when I was working on a story about farmer taxes. He turned out to be perfect for that — a farmer with a keen interest in spreadsheets.

Kenney and his family lived through the farm crisis of the 1980s, when the bottom dropped out of the U.S. economy and collapsing global food markets forced many farmers out of business. He surprised me, though, when he started describing how lucky he was to grow up during a notoriously tough time to be a farmer — and became choked up by the memories.

“At the time, it didn’t feel like a whole lot of fun. The 󈨔s for farmers in Iowa and the Midwest and throughout the country were not looked upon as, ‘Jeez those were great times,’” Kenney said. “But they also taught us a lot of lessons.”

His family’s farm, run by Kenney’s father and grandfather, survived, but he watched with them as neighbors lost their farms.

“A lot of good farmers went out of business and that’s tough to see,” Kenney said, “In some cases through no fault of their own. It’s just — caught up in a bad economic time.”

Now a farmer himself, he knows the extraordinary effort it takes to keep a farm running. And that’s in the good times.

“I’m even more thankful for my grandparents, my parents, my uncle because of the hard work they put in during those times,” Kenney said. “[They] gave us the opportunity to stay on the farm and for me to make my livelihood from the farm, too.”

As the farm crisis spiraled out of control and farmers all over the country struggled to stay afloat, it was hard for many to imagine a future on the farm.

“Commodity prices were depressed, land values kept falling, and it didn’t seem like there was a whole lot of reason to be optimistic,” Kenney said. That left many of his generation uninterested in farming.

“Becoming a farmer wasn’t cool,” Kenney said.

Even though he wanted to farm, he saw clearly the need to have a variety of skills. His background includes working at a company that financed agricultural equipment and earning a master’s degree in agricultural economics before returning to be the fifth generation to farm his family’s land, with his father and his brother-in-law. (Kenney’s niche on the farm, he said, is spreadsheets and financials.)

Talking about the 1980s is emotional for Kenney, but he said lessons learned as a young boy still stay with him today. The crisis fostered in him an appreciation for what he has.

“I’m thankful for it because I kind of know, don’t forget that those times could come again,” he said.

And the hard times also demonstrated to Midwestern farmers their intractable place in a global market.

“They taught us about world trade, they taught us about exchange rates, they taught us about interest rates, they taught us about inflation,” Kenney said. “Things that farmers before then may have been aware of, but they didn’t realize that what happens on the world stage could put me out of business.”

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After treaties with the American Indians and federal legislation opened up Oklahoma lands for settlement between 1889 and 1906, agriculture developed very rapidly. Although the Indians in eastern Oklahoma had done some farming, mainly by leasing their lands to white tenants, farming in Oklahoma did not become very important until after 1889. Following the Land Run of April 22, 1889, when thousands of people rushed into the Unassigned Lands, agriculture moved swiftly toward becoming the basis of the Oklahoma economy. As the president of the State Board of Agriculture wrote in 1907, "agriculture is, and will be for years to come if not forever, the leading industry in our State." His prediction was partially correct, because agriculture was the state's leading industry well into the twentieth century.

The pioneer settlers who pushed quickly into Oklahoma Territory to establish farms on free or cheap land did not have an easy time. Confronted by periodic droughts, low prices for crops and livestock, lack of capital, and other problems, they struggled to get a firm foothold on the land. Many of them initially lived in sod houses or dugouts and provided most of their own subsistence by growing garden vegetables, milking a few cows, butchering their own meat, and raising a few acres of corn. Times were so difficult and farmers so desperate in 1891, because of the severe drought in parts of the territory, that the railroads provided some seed grain so farmers could plant a crop.

Despite the hardships endured in the early years of settlement, the federal census reported that between 1890 and 1900 the number of farms increased from 8,826 to 108,000. By 1910, when the census was taken after statehood, the number had jumped to 190,192. Of this number 13,209 farms were operated by African American farmers. In fewer than twenty years the area that became Oklahoma added about 180,000 farms to the nation's total. This was one of the most rapidly settled agricultural frontiers in American history. After 1910 the number of farms in Oklahoma remained about the same for a generation, between 190,000 and 210,000, until a steady drop began in the late 1930s.

Oklahoma farmers produced a wide variety of crops including corn, cotton, winter wheat, oats, milo maize, potatoes, sweet potatoes, peanuts, broomcorn, cowpeas, alfalfa, wild hay, and others. They also produced and sold poultry, eggs, cheese, butter, and garden and orchard products. The main crops by acreage and value, however, were corn, cotton, and winter wheat.

Corn was an ideal crop for a largely self-sufficient family in the early years of settlement. It was easy to raise and was valuable as both a feed for livestock and food for the family table. A farm wife could prepare grits, cornbread, and other foods from cornmeal, ground at home or at a local mill. Most farmers planted some corn, and by 1910 more than five million acres were grown. This was more than twice as much as any other crop.

Cotton was Oklahoma's leading money crop, and production increased rapidly after about 1900. A decade later cotton farmers produced 923,000 bales on 2,324,000 acres. In the first decade of the twentieth century cotton growing was concentrated in central and southwestern counties of the state. In 1907 Lincoln County had thousands of acres of cotton, and some was grown in Woodward and surrounding counties. By 1910 Oklahoma ranked sixth among the cotton-producing states with a crop value of $61.8 million, as compared to the value of the corn crop of $47.8 million and wheat of $22.2 million.

The growing emphasis on cotton, however, raised serious questions among some of the state's leaders because of the system's effect on farm families. J. P. Connors, president of the State Board of Agriculture, wrote in 1908 that by concentrating on cotton, instead of diversifying their crops and raising livestock, farmers became trapped in a destructive credit system. As early as 1910 some 54 percent of Oklahoma farmers were tenants, and tenancy was even higher among cotton farmers. The rate was highest among African American sharecroppers. Connors did not advise against planting cotton but urged farmers to diversify and raise as much of their own living as possible.

Representatives of the newly established agricultural college at Stillwater (Oklahoma A&M, now Oklahoma State University), directors of the Agricultural Experiment Stations, and editors of farm publications were among others who urged farmers to diversify their operations. Farmers were advised to attend conferences and institutes to gain better knowledge of how they might improve their income and of how farm wives could increase their contribution to the family welfare. For example, in 1916 the U.S. Department of Agriculture (USDA) reported that farm women in Bryan County experienced greater success in dairying and raising poultry under the guidance of a home demonstration agent. Despite the effort to better educate farmers and improve life on the family farm, many farmers were either unwilling or unable to make the recommended changes. This was especially the case in locations where cotton was the principal crop.

By the eve of World War I Oklahoma farmers had established an agricultural pattern that would persist for another generation. Wheat growing rapidly expanded in the central and northwestern parts of the state while corn acreage steadily declined. By 1920 only a little more than half as much corn was planted as in 1910. Wheat acreage, on the other hand, more than doubled in that decade. As farmers pushed farther west into the drier parts of the state, especially the Panhandle, where rainfall averaged less than twenty inches annually, they planted more drought-resistant sorghum crops such as milo maize and sorghum.

By 1920 the average size Oklahoma farm was 166 acres. However, there were huge variations in size. The largest category of farms, or 34 percent, was from 100 to 174 acres, the traditional 160-acre homestead. However, there were thousands under fifty acres, many of them operated by white and black sharecroppers. The large farms, those of more than 260 acres, made up about 14 percent of the total. Most of the state's farms were family enterprises in which the operator used horse and mule power to pull their plows, cultivators, and other machinery. A few large wheat farmers were beginning to adopt tractors and combines, but full-scale tractor farming was still in the future. Farm families provided much of their own living, especially outside the main cotton-producing areas, and most of their own labor. Men and sometimes women, as well as children, worked in the fields, milked cows, and did other chores. Women tended gardens, raised chickens, made and sold butter, and marketed eggs. Their work contributed greatly to the economic condition of residents. The federal census of 1920 reported that on the average Oklahoma farm families provided 57 percent of their own food.

Oklahoma's 194,000 farmers were just beginning to be exposed to modern conveniences by 1920. Only 4 percent had electricity, 1 percent owned trucks, and 3 percent had acquired tractors to replace or supplement horse and mule power. However, an increasing number of farmers were becoming better connected to the larger world: 25 percent had automobiles, and 37 percent enjoyed telephones. Overall, it was still the horse-and-wagon and dirt-road period of farming in the Sooner State. The benefits of electricity, running water, and indoor bathroom facilities were still nearly a generation away for most.

The deflation and severe drop in farm prices that began in late 1920 severely affected all of American agriculture. Oklahoma farmers were among those hardest hit. The prices of cotton, wheat, and livestock, the main sources of agricultural income, drastically dropped. Between 1919 and 1920 cotton prices declined from thirty-five cents a pound to twelve cents wheat brought only half as much in 1921 as it had in 1919. The cost of things farmers had to buy did not drop in proportion to those of farm prices, which created what the economists called a cost-price squeeze.

These conditions intensified a spirit of political unrest and radicalism among Oklahoma farmers who believed that the large corporate and financial institutions had become their oppressors. There had been a substantial number of discontented farmers even before 1907 statehood. Some of them had joined the Socialist Party, which advocated state-operated enterprises such as a state bank and state-owned grain elevators, warehouses, and other facilities that Socialists believed could serve farmers better and at lower costs. Farmers complained loudly about high interest rates, especially those charged to tenants and sharecroppers. In some cases interest rates were as high as 40 percent a year on loans. Many farmers in Oklahoma voted for Fred W. Holt, the Socialist Party candidate for governor in 1914, when the party polled about fifty-two thousand votes. Farmers also joined the Nonpartisan League in 1918 and demanded that the state establish state-owned marketing facilities to help farmers.

Given this background of protest, it is not surprising that financially depressed farmers were the most numerous supporters of the Oklahoma Farmer-Labor Reconstruction League, and of Jack Walton, the organization's candidate for governor in 1922. The league's legislative goals called for much the same program advocated by the Socialists. Farmers believed that state-owned enterprises would help their economic situation. While the farm vote helped Walton win the governorship, he was unable to push any of the league's programs through the legislature and was eventually impeached. Farmers were left without any assistance from state government. John A. Simpson, a leader in the Oklahoma Farmers' Union and later president of the National Farmers Union, was the most active and influential farm spokesperson in Oklahoma.

Better prices by 1923 and 1924 for both wheat and cotton reduced farm discontent, although life on thousands of Oklahoma farms was a struggle. There were a few good years in the 1920s but also some very bad ones for commercial farmers. In 1925 cotton farmers planted 5.2 million acres of cotton and produced 1,691,000 bales that brought seventeen cents a pound. But the next year a huge crop drove prices down to only nine cents a pound. Wheat prices were also good in 1925, bringing $1.40 a bushel, but within a couple of years it was only a dollar a bushel. In short, the extreme changes in the price of farm crops and livestock were hard on farm income. Moreover, both interest rates and taxes continued to be high. By 1930, 61 percent of Oklahoma's farmers were tenants, and in some counties tenancy was as high as 70 percent.

However hard the economic struggle was for farmers in the agricultural depression of the 1920s, the onset of the Great Depression in 1929 and 1930 created even worse conditions. By 1931 and 1932 farm commodity prices had dropped to disastrous levels. The farm price of the huge cotton crop of 1931 fell to about five cents a pound, and wheat brought as little as thirty cents a bushel. Prices of other crops and livestock also dropped. Peanuts, which had become an important crop for some farmers in the southwestern part of the state, declined to as low as $1.60 for one hundred pounds, or about one and one-half cents a pound. The gross income of all Oklahoma farm production, both crops and livestock, dropped from $314 million in 1929 to $115 million in 1932.

Under these circumstances, what could farm families do? They had tried to improve their position in the economy in the 1920s by forming agricultural cooperatives. They had sought to increase their efficiency through agricultural mechanization by using more and better production equipment. They had appealed for state and federal help, but nothing had brought any relief. About all the USDA could suggest was for farmers to become more self-sufficient. But, according to one writer, farmers had lowered their standard of living "to an extent reminiscent of pioneer days."

Finally, in May 1933 farmers began to see a glimmer of hope through Franklin D. Roosevelt's New Deal when Congress created the Agricultural Adjustment Administration (AAA) and subsequently enacted other legislation to help farmers. Believing that huge agricultural surpluses were responsible for low prices, the AAA provided Oklahoma's cotton and wheat farmers cash benefit payments in return for reducing their acreage. Producers of some other crops also received federal benefits, and programs were implemented to assist hog and cattle raisers. To bring supply and demand into better balance, farmers plowed under a portion of their growing cotton in the spring of 1933. Drought cut wheat production, but farmers received benefit payments if they promised to reduce acreage in 1934. Federal programs also included better farm credit facilities and payment for certain soil conservation practices. Some farmers also received cash from work relief projects.

Federal programs were very significant in helping Oklahoma farmers get through the Great Depression. For example, in the fall of 1933 the state's wheat growers received $6,840,000 in cash benefit payments, and cotton farmers realized millions more. Cash payments continued through the 1930s and beyond. Because cash payments to farmers of the main crops were made for reducing acreage, the larger operators benefited most from direct government payments. Small farmers, especially sharecroppers, received little help. This left thousands of small family farmers still struggling to survive.

Federal farm programs helped farmers get better prices for their products, but nothing could stop the drought and severe dust storms that struck western Oklahoma between 1933 and 1937. The western and northwestern counties all suffered, but conditions were worst in the Panhandle. The economic catastrophe created by wind, drought, and poor prices caused such distress and financial hardship that thousands abandoned their farms and migrated to California and elsewhere. Many of these migrants left the eastern part of the state as well. The Dust Bowl out-migration was most dramatic between 1935 and 1940 when the number of farms decreased by 33,638. The drought conditions in the 1930s encouraged some farmers in western Oklahoma to turn to irrigation. That area rested on a huge underground aquifer, and by the 1930s deep drilling and pump technology made deep well irrigation practical. A few farmers turned to irrigation before 1950, but land under irrigation expanded quite rapidly in the next thirty years.

The highest number of farms in Oklahoma history, 213,325, was recorded in 1935. These figures reflect some return to the farm by town dwellers who wanted to raise part of their own food or who no longer had an urban job. From 1935 onward, however, the number of farms dramatically declined. Even though during World War II both crops and prices were favorable to farmers, by 1950 Oklahoma had only 142,246 farms. Many of the small operators concluded that they could not make a living, or they found better conditions in nonfarm employment. Even somewhat better living conditions could not keep families "down on the farm." By 1950 Oklahoma's farm population was only 25 percent of the state's total, compared to 50 percent in 1920.

In the late 1930s living conditions on the farm were beginning a major transformation, largely because the Rural Electrification Administration (REA) was established in 1935. By 1950 about two-thirds of Oklahoma's farmers had electricity. In addition to electric lights, many farm families began to enjoy running water, bathroom facilities, home freezers, refrigerators, electric washing machines, and other conveniences. By midcentury the better-off farmers experienced about the same home conveniences and standard of living as their town and city cousins.

By 1950 it was clear that a major restructuring was occurring in Oklahoma agriculture. Farms were becoming fewer and larger as the better-capitalized and more efficient producers expanded by renting or buying more land from departing neighbors. From 1950 to 1980 the number of farms dropped from 142,246 to 72,000, and the average size more than doubled from 253 acres to 481 acres. By 1997, the last federal census of agriculture in the twentieth century, Oklahoma reported a few more farms, but this was caused partially by a change in the definition of a farm.

By the 1970s the state's commercial agriculture was concentrated in the hands of relatively few farmers. In 1978 the market value of all farm products sold was $2,367,696,000. Fifty-five percent of that value was produced by only 3,716 farmers and ranchers. These large corporate farms were highly capitalized with huge investments in equipment such as tractors, trucks, grain combines, mechanical cotton pickers, hay balers, and other expensive machines. Farms were significant business enterprises that required not only large amounts of capital but also good management to be successful. In 1997, for example, more than four hundred Oklahoma farmers sold in excess of $500,000 worth of wheat, and 114 of them more than $1 million worth.

Thousands of small farmers had become "sidewalk and suitcase farmers"—part-time or hobby farmers—and derived their main income from off-farm work. Of the 74,214 farms reported in 1997, over half, or 41,154, of the operators listed their main occupation as something other than farming. Only 33,060 listed farming as their principal occupation. Whether it was grain or cotton farming, raising peanuts or sorghums, or raising chickens, hogs, or cattle, the operations were mainly in the hands of large operators. By the end of the century most of the hogs and poultry were raised in confined conditions by a few producers. Despite a growing degree of concentration in agriculture, most farms continued to be family owned. But the successful family farms of the 1990s were dramatically different from those in the years before World War II.

By the 1990s the annual value of Oklahoma's agricultural production annually ranged between $4 billion and $5 billion. In 1997 the figure was $4.1 billion. Of this amount, crops were responsible for $908 million and livestock and poultry products for $3.2 billion. Wheat had become by far the main commercial crop, leading hay, cotton, sorghums, peanuts, and soybeans by a large margin. By the late twentieth century Oklahoma usually ranked second, third, or fourth in the nation in winter wheat production.

While the number of farms and the farm population declined sharply after World War II, agriculture continued to be a major factor in Oklahoma's economy. Farming not only supplied food and fiber for state, national, and world needs, it furnished the raw materials for processing and manufacturing industries that provided consumer goods and nonfarm employment.

By 2000 only a very small percentage of Oklahomans lived on farms. However, the historical experiences of farming and farm life have placed an indelible imprint upon the state and its people. The steady decline of the farm population and agriculture's lessening role in the economy have not eliminated the traits and character associated with strong rural traditions. Hard work, honesty, responsibility, neighborliness, a cohesive family life, and practicality are some of the historic farm traits that have been incorporated into the lives of modern Oklahomans. Indeed, the state's farm experiences have left a permanent mark, not only on its economy, but also on Sooner history and culture that will take generations to erase, if ever.


Gilbert C. Fite, American Agriculture and Farm Policy Since 1900 (New York: Macmillan, 1964).

Gilbert C. Fite, Cotton Fields No More: Southern Agriculture, 1865–1980 (Lexington: University Press of Kentucky, 1984).

Gilbert C. Fite, The Farmer's Frontier, 1865–1900 (New York: Holt Rinehart, and Winston, 1966).

Donald E. Green, ed., Rural Oklahoma (Oklahoma City: Oklahoma Historical Society, 1977).

Richard Lowitt, "Farm Crisis in Oklahoma, Part 1," The Chronicles of Oklahoma 89 (Fall 2011), "Part 2," 89 (Winter 2011-12).

Ralph E. Olson, "Agriculture in Oklahoma," in Geography of Oklahoma, ed. John W. Morris (Oklahoma City: Oklahoma Historical Society, 1977).

U.S. Bureau of the Census, Census of Agriculture (Washington, D.C.: GPO, 1890–1997).

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The following (as per The Chicago Manual of Style, 17th edition) is the preferred citation for articles:
Gilbert C. Fite, &ldquoFarming,&rdquo The Encyclopedia of Oklahoma History and Culture,

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This research was carried out with a grant from the Andrew P. Mellon Foundation. Earlier drafts have benefited from comments from Sandra Archibald, Melvin Fuss, Paul Hohenberg, Donald McCloskey, Ramon Myers, Thomas Wiens, and two anonymous referees, and from participants at seminars at the University of California, Davis, and the University of Toronto.Google Scholar

1 Huang , Phillip C. C. , Peasant Economy and Social Change in North China ( Stanford , 1985 ).Google Scholar For India, see Chandra , Bipan , “ Reinterpretation of 19th Century Indian Economic History ,” The Indian Economic and Social History Review , 5 ( 03 1968 ), pp. 35 – 76 . esp. pp. 50–51.CrossRefGoogle Scholar

2 Berry , Albert and Cline , William , Agrarian Structure and Productivity in Developing Countries ( Baltimore , 1979 ).Google Scholar

3 This review appears in Economic Development and Cultural Change , 35 ( 04 1987 ), pp. 670 –82.CrossRefGoogle Scholar

4 It should be pointed out that the data are primarily drawn from areas that were relatively commercialized. By the 1930 s this segment of the rural Chinese economy constituted between 40 and 50 percent of the rural population, or upwards of 200 million people. My analysis does not necessarily hold for the remaining half.Google Scholar

5 According to Buck, on small farms the percentage of net income from other-than-farm sources was approximately three times that on larger farms. These estimates appear in Buck , John , Land Utilization in China: Statistical Volume ( Chicago , 1937 ), p. 311 .Google Scholar

6 This article focuses primarily on local factor markets. Implicit in my analysis is a similar assumption about product markets. I examined some of the changes in Chinese product markets in “ Chinese Agriculture and the International Economy, 1870s–1930s: A Reassessment ,” Explorations in Economic History , 22 ( 05 1985 ), pp. 168 –93.CrossRefGoogle Scholar

7 The two factors that contributed most to this process were the secular rise in the terms of trade between the 1890 s and the late 1920 s and new domestic and international market opportunities.Google Scholar

8 For a related “revisionist” view on the influence of commercialization on the prewar Japanese rural economy, see Smethurst , Richard , Agricultural Development and Land Disputes in Japan, 1870–1940 ( Princeton , 1986 ).CrossRefGoogle Scholar

9 Data compiled by Ramon Myers for various villages in East-Central China in the 1930s show the same phenomenon. See his “The Commercialization of Agriculture in Modern China,” in Willmott , W. E. , ed., Economic Organization in Chinese Society ( Stanford , 1972 ).Google Scholar

10 More formally, I tested the relationship between farm size and land productivity by regressing gross farm output per unit of cultivated area (GFOCA) on the log of cultivated area (In CA) using the pooled data. (Lacking local price indices, the data for Wukuan have been deflated by the Nankai wholesale price index for agricultural goods for Tientsin, a major outlet for the market surplus of the region. This index appears in Nan-ching ta-hsueh ching-chi yen-chiu-so, eds.Google Scholar , Nan-k'ai chih-shu rzu-liao hui-pian, 1913–1952 [ Beijing , 1958 ], p. 12 .) The t–statistics are in parenthesis. GFOCA = 33.3_legacy1 + 1.31(In CA) (5.05) (0.63) R 2 = 0.07 n = 57 The small t–value for the coefficient on In CA and the low explanatory power of the model (as measured by R 2 ) do not support a systematic relationship between farm size and land productivity in these localities.Google Scholar

11 By comparison, Huang found in his sample of 14 farms that net profits (and, therefore, net profits per unit of cultivated area) were negative for 4 of the 5 small (less than 30 mou) farms, but positive for the remaining 9 farms. He attributes this to the greater use of labor on small farms, of which more is said below, and uses this finding to support the view that smaller farms were less efficient.Google Scholar

12 On the basis of oral testimony he obtained, Huang noted that a wage laborer worked a longer day at greater intensity than family members did on their own farms. According to Buck, on the other hand, women and children performed between 20 and 30 percent of the work on farms in North China. On some of these smaller farms the adult male hired out as a monthly or annual laborer, so remaining household members performed most of the work on the family farm.Google Scholar

13 Buck , John L. , Chinese Farm Economy ( Nanking , 1930 ).Google Scholar

14 Buck used relative prices to convert nongrain crops into their grain equivalents.Google Scholar

15 Even if there is not a well-developed rural labor market that offers off-farm wage opportunities, we would still expect land to be leased until differences in the marginal product of labor across farm sizes disappeared. Only in the case where neither set of markets is working well would we find small peasant farms using land more intensively. More formally, if imperfections are present in at least two of the factor markets (that is, markets for land, labor, capital, and draft animals), the factor price ratios that peasant households implicitly face will differ. Assuming profit maximization, this implies that optimal factor combinations will differ among farm households, as will output/input ratios.Google Scholar

16 See, for example, Rawski , Thomas , China's Republican Economy: An Introduction , Joint Center of Modern East Asia, University of Toronto-York , Discussion Paper No. 1 ( 1978 )Google Scholar and Myers , Ramon , The Chinese Economy: Past and Present ( Belmont , 1980 ).Google Scholar After arguing to the contrary in earlier work, Albert Feuerwerker noted in his recent contribution to the Cambridge History of China that few studies have been able to document the presence of monopolistic or monopsonistic elements in local markets. See his “Economic Trends, 1912–1949,” in Cambridge History of China, Republican China 1912–1949 , Part I ( Cambridge , 1983 ).Google Scholar

17 Farm households in North China were not only aware of local opportunity costs, but were equally informed of and profoundly influenced by interregional wage differences. According to Thomas Gottschang, these same households “year in and year out weighed the information they received about job possibilities and wage levels in Manchuria against local conditions, with an eye to sending off a son or a brother when the difference promised a positive return to their investment.” See Gottschang , Thomas , “ Economic Change, Disasters, and Migration: The Historical Case of Manchuria ,” Economic Development and Cultural Change , 35 ( 04 1987 ), pp. 461 –90.CrossRefGoogle Scholar


Tenant farming is a system of agriculture whereby farmers cultivate crops or raise livestock on rented lands. It was one of two agricultural systems that emerged in the South following the American Civil War (1861 – 1865) the other system was sharecropping. The South in economic ruin, former plantation owners were now without slave labor and lacked resources to hire wage laborers. They began dividing up their land and arranging the tracts to be farmed by one of these two methods. In 1860 there were just under 700,000 farms in the South in 1910 the division of the former plantations resulted in more than three million farms.

A tenant farmer typically could buy or owned all that he needed to cultivate crops he lacked the land to farm. The farmer rented the land, paying the landlord in cash or crops. Rent was usually determined on a per-acre basis, which typically ran at about one-third the value of the crop. At the end of the harvest the landowner would be paid one-third the value of the crops or would receive one-third the crops directly from the farmer. While this system was superior to that of sharecropping and many sharecroppers aspired to being tenant farmers, the method also had its downfalls. Tenant farmers frequently found themselves in debt to the landowner. At the beginning of a planting season, the farmer would secure store credit based on the crop's expected yield. If conditions were poor or market prices for the crop decreased, the farmer became indebted to the storeowner and to the landowner (which was often the same person). Another consequence of tenant farming was the deterioration of the land since it did not belong to them, many farmers were not motivated to do ample upkeep or make improvements, thus, farms tended to deteriorate. However some tenant farmers proved successful and ultimately moved off rented lands to purchase their own tracts. Generally, however, this was not the case and the system, along with sharecropping, proved to be a failure.

See also: Reconstruction, Sharecropping

Cite this article
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Industrial Agriculture

The success of modern U.S. farming is a result of industrial agriculture. It’s when mass-production techniques are used to create food. A big component is monocultural growing of the same crop in the same large field. Chemical fertilizers, pesticides, and feed additives must be used to boost production.

Between 1948 and 2015, industrial agriculture doubled U.S. farm production.   At the same time, both the amount of land tilled and the number of farmers declined.

Industrial agriculture began in the 1900s.   Chicago's Union Stock Yard slaughterhouse used conveyor belts to increase meat production.   Henry Ford said industrial slaughterhouse operations inspired him to use assembly lines in his auto production.

In the late 1920s, chickens were the first animals to be raised in economical but large, cramped facilities.   In the 1970s, pork and beef farmers followed suit. This type of factory farming is called concentrated animal feeding operations.  

To prevent illnesses from these cramped conditions, animals are fed antibiotics. In 1951, the Federal Drug Administration approved antibiotic use because it also increases weight gain of the animals.   Some scientists estimate that 80% of all antibiotics sold are used in agriculture. There are now concerns that this use has increased antibiotic-resistance in human communicable diseases.    

Farms and the economy - History

Also, productivity on the farm grew because the government got much more heavily involved, both through direct payments and indirect support of agricultural technology research. From 1940 on, making money in farming meant that you had to understand and manage government programs.

Bruce L. Gardner charts the growth in productivity using USDA data in his book American Agriculture in the Twentieth Century, (Harvard University Press, 2002). Looking at several factors that document productivity, Gardner says, "Productivity growth was slow before the 1930s. The estimated rate of productivity growth is 0.4 percent in [the period] 1910-1939 per year and 2.0 percent in 1940-1996."

Gardner says that it's difficult to pinpoint a single year as the turning point. But, "at some point between 1935 and 1940, U.S. agriculture became able to increase its output of crops and livestock per unit of inputs at a substantially faster sustained rate than had been seen before in our history (and at a faster rate than in the U.S. non-farm economy). This accelerated rate of growth was maintained throughout the last half of the twentieth century."

In other words, farmers were getting better and better at their jobs, using more and better technology, and progressing at a faster pace than urban workers. Gardner sees huge advantages for both farmers and consumers. "Productivity growth provides the potential for higher farm incomes and lower consumer food costs."

Plant scientist Stan Jensen says, "We're certainly more sophisticated farmers now than we were." He says that the technological innovations built on each other. Corn combines needed better hybrid varieties that would stand up in the field. Advances in irrigation and fertilizers spurred new varieties to take advantage of those conditions in the field. One technological advance took advantage of another and created opportunities for other advances.

In this section, we'll take a look at the wartime pressures and economic conditions that almost forced farmers to become more productive. We'll examine a host of post-war Food for Peace programs and the implications of those programs on agricultural exports. And we'll explore how the farm economy began to change radically.

Written by Bill Ganzel, the Ganzel Group. A partial bibliography of sources is here.

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