The American economy was booming in the 1920s, but things weren’t rosy for everyone. Farmers were in trouble.
During World War I, farmers benefited from increased European demand for American agricultural products. Inspired by high demand and high prices, many farmers invested in more land and expensive motorized farm equipment.
After the war, Europe resumed agricultural production, but American farmers were slow to cut back. Without the same demand from foreign markets, prices for agricultural goods plummeted. Unfavorable weather conditions added to the strain.
The Dust Bowl of the “Dirty Thirties” was still to come, but the Great Plains already faced significant drought during the 1920s. Disaster was just around the corner.
In early 1924, Senator Charles L. McNary of Oregon and Representative Gilbert N. Haugen of Iowa introduced a bill calling for a federal farm board. It would purchase surplus agricultural products at pre-World War I prices.
The plan had support from the Secretary of Agriculture and from corn and wheat producers but Congress failed to pass it.
Opponents claimed the bill would raise prices for consumers. Supporters disagreed. Haugen used the cost of bread to make his point: he said the wheat only accounted for two cents of a ten-cent loaf. The rest went to overhead and profit. If the bill added just two cents, the cost to consumers would be minimal.
But on this date in 1926, Haugen admitted that while the bill included provisions to limit inflation, “We assume the bill will raise the cost of living.”
The McNary-Haugen Farm Relief Bill lacked support in non-agricultural areas. Many feared it would raise prices, and critics argued it rewarded overproduction.
Congress passed the bill in 1927, but President Calvin Coolidge vetoed it. It passed again in 1928—and Coolidge vetoed it again.
The McNary-Haugen Farm Relief Bill was never enacted into law.
Dakota Datebook by Dr. Carole Butcher
Sources:
- Bismarck Tribune. “Haugen Admits His Farm Relief Plan Means Higher Food Prices.” Bismarck ND. 5/14/1926. Page 6.
- US History. “McNary-Haugen Farm Relief Bill.” https://www.u-s-history.com/pages/h1439.html Accessed 4/17/2024.
