Western Farm Areas in Two World Wars

Abstract

ABRIEF analysis of the financial and economic structure of several Western and Midwestern farm states during the period of World War I as compared with World War II affords an interesting study in contrasts which has basic significance for national agricultural policy. This is a case study of ten states in which agriculture is the principal industry. The area was chosen more or less arbitrarily. It is approximately coterminous with the boundaries of the Ninth and Tenth Federal Reserve Districts, and includes the states of Colorado, Kansas, Nebraska, New Mexico, Oklahoma, Wyoming, Minnesota, Montana, North Dakota and South Dakota. It should be noted that these states include the so-called Dust Bowl area where some of the nation's most severe agricultural distress occurred during the 'twenties and 'thirties. At the end of World War I American farmers stood in an apparently enviable position. Much of the nation's greatness had been built on her abundant agricultural production, and in World War I just ended, the industry had demonstrated its key position in the economy. America's principal contribution to the allied cause had come from her farms. Farmers had benefited correspondingly. Prices of all farm products were far higher than they had ever been before. Farmers were better supplied with equipment than ever before. Inventories of livestock were large and expanding. Bank deposits in farm areas were the highest on record. And what seemed most encouraging to large numbers of farmers was the great and unprecedented increase in the value of their farms. Yet, in spite of these apparent advantages, agriculture soon encountered a severe depression. The hardship and losses did not end with the upturn in general business conditions which soon followed the depression of 1920-1921. Agriculture remained relatively depressed throughout the prosperous 'twenties. Then, with the Great Depression of the 1930's a bad situation became worse and the farm problem soon approached the proportions of a catastrophe. In spite of numerous government aids and palliatives, American agriculture enjoyed only a limited recovery during the 'thirties. At the beginning of World War II the basic problem of over-produc-