The

interwar In the history of the 20th century, the interwar period, also known as the interbellum (), lasted from 11 November 1918 to 1 September 1939 (20 years, 9 months, 21 days) – from the end of World War I (WWI) to the beginning of World War II ( ...

farm crisis A farm crisis is an American term for a time of agricultural recession, low crop prices and low farm incomes. The Interwar farm crisis was an extended period of depressed agricultural incomes from the end of the First to the start of the Second ...

was an extended period of reduced agricultural demand between the end of the First and

Second The second (symbol: s) is a unit of time derived from the division of the day first into 24 hours, then to 60 minutes, and finally to 60 seconds each (24 × 60 × 60 = 86400). The current and formal definition in the International System of U ...

World Wars.

Crisis of the 1920s and 1930s

A farm crisis began in the 1920s, commonly believed to be a result of high production for military needs in

World War I World War I or the First World War (28 July 1914 – 11 November 1918), also known as the Great War, was a World war, global conflict between two coalitions: the Allies of World War I, Allies (or Entente) and the Central Powers. Fighting to ...

. At the onset of the crisis, there was high market supply, high prices, and available credit for both the producer and consumer. The U.S. government continued to instill inflationary policy following World War I. By June 1920, crop prices averaged 31 percent above 1919 and 121 percent above prewar prices of 1913. Also, farm land prices rose 40 percent from 1913 to 1920. Crops of 1920 cost more to produce than any other year. Eventually, a price break began in July 1920 which squeezed farmers between both decreasing agricultural prices and steady industrial prices. Examples of decreasing agriculture prices include: By 1933, cotton was only 5.5 cents per pound, corn was down 19.4 cents per bushel, and hogs declined to $2.94 instead of their respective 1909–1914 average prices of 12.4 cents per pound, to 83.6 cents per bushel, and $7.24 per hog. Furthermore, a region of the great plains was hit by an extreme drought which added to the agricultural difficulties of the time, leading to

depopulation Population decline, also known as depopulation, is a reduction in a human population size. Throughout history, Earth's total human population has continued to grow but projections suggest this long-term trend may be coming to an end. From ant ...

Reformation of the 1920s and 1930s

Throughout this crisis there were many attempts to form Farmers' Unions. This was difficult considering the lack of effective communication technology, the lack of electricity on many farms, and the overall size of the country. The

Agricultural Marketing Act of 1929 The Agricultural Marketing Act of 1929, under the administration of Herbert Hoover, established the Federal Farm Board from the Federal Farm Loan Board established by the Federal Farm Loan Act of 1916 with a revolving fund of half a billion do ...

intended to bring government aid to cooperatives. It allowed the

Federal Farm Board The Federal Farm Board was established by the Agricultural Marketing Act of 1929 from the Federal Farm Loan Board established by the Federal Farm Loan Act of 1916, with a revolving fund of half a billion dollars Agricultural Adjustment Act The Agricultural Adjustment Act (AAA) was a United States federal law of the New Deal era designed to boost agricultural prices by reducing surpluses. The government bought livestock for slaughter and paid farmers Subsidy, subsidies not to plant ...

(AAA), which was enacted on May 12, 1933, aimed to bring back pre World War 1 Farmers' abilities to sell farm products for the same worth they were able to buy non-farm products. The Act involved seven different crops: corn, wheat, cotton, rice, peanuts, tobacco, and milk. Farmers were paid to not plant those seven crops, thus decreasing supply and returning to market equilibrium. In order to prevent noncooperative farmers from taking advantage of other farmers decreasing supply the bill states "is to keep this noncooperation minority in line, or at least prevent it from doing harm to the majority, that the power of the Government has been marshaled behind the adjustment programs" In other words, the benefits from payments to cooperative farmers were designed to be more beneficial than being noncooperative and flooding the market. The AAA was deemed unconstitutional on January 6, 1936.Perkins, Van L. "Crisis in Agriculture: The Agricultural Adjustment Administration and the New Deal", 1969. Further reformation included Farm Credit Act of 1933, which allowed farmers to re-mortgage no longer affordable property, as well as the Frazier–Lemke Farm Bankruptcy Act.

References

{{reflist Agricultural recessions Recessions in the United States Interwar period History of the United States (1917–1945) Dust Bowl