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Urban America Section 6.4 Populism (Appleby 242-247) Today’s Agenda Day 17 • • • • 4.3: Plight of the Farmer Slide Show Day 17 Presentations Homework Finish Reading 4.3 in textbook (pages 128-133) • Unit Test on the Political Spectrum & Chapter 4.2 & 4.3 Wed.!!! Homestead Act What happened to farmers in the 1880s? • Homestead Acts – US Gov. gave up to 162 acres for free • New farming methods – use of manure • New machinery – McCormick Reaper • So things were going well, right? • NO What happened to farmers in the 1880s continued? • overproduction – led to falling prices • High mortgage payments, high tariffs, high transportation prices • widespread poverty, natural disasters, loneliness What should the farmers do? What factors may hinder them (that would not hinder an urban worker)? Who were the Grangers? (1867) • Farmers union • Held mass meetings • Pooled money together – purchase supplies, equipment, negotiate • Lobbied Midwestern legislatures for Granger laws regulating: – Rates charged by RR – Rates charged by grain elevators Which side of the political spectrum are the Grangers leaning? What was the Populist (People’s) party? • Third party • Coalition of farmers, laborers, reformers • Favored: – Immigration restrictions – 8 hr. workday – Income tax – Gov Ownership of RR, telegraph system – Direct election of senators – Devalued currency • Would cause inflation The Populist Party (begin at 1:39) What is significant about the Munn v. Illinois case of 1877? (Not in text) • Supreme Court upheld right of Illinois to regulate private property – Giant elevators used for grain – State CAN set prices farmers pay for elevators • Decision restricts railroads using predatory (monopolistic) business practices against small merchants – Rebates and discounts for huge hauls What does this decision indicate regarding government’s role in the economy? • Are they leaning right, left, in the middle? • Are they becoming liberal, conservative? • What element of pure capitalism is starting to be refuted? Radical Liberal Conservative Reactionary What did the Supreme Court decision in the Wabash case (1886) do to Munn v Illinois? • Judicial Review (power of Supreme Court to review laws) destroyed it • Railroad lawyers argued Article I, Section 8, Clause 3 of the US Constitution – That Congress (NOT STATES) shall have the power: • To regulate commerce with foreign nations, and among the several States, and with the Indian tribes Whose side is the Supreme Court on in this case? What were the results of the Wabash case? • Interstate Commerce Commission (1887) created – Congress asserts its right to regulate interstate trade • A weak law • Cleveland was laissez-faire • Sherman Anti-Trust Act of 1890 – Prohibited monopolies restraints in trade • Circumvented by monopolies • Morphed into “holding companies” • Not enforced by courts What happened to the US economy in 1893? • Panic of 1893 – 20% unemployment – Cleveland= laissez faire • Jacob S. Coxey – businessman led march of 500 people from Ohio to Washington – Wanted to call attention to high rate of unemployment – Arrested for walking of grass What does silver have to do with the economy? Panic of 1893 & Coxey’s Army. Describe America’s financial policy in the 1890s: • Tight money policy – U.S.’s money supply based on Gold – Very limited (tight) supply – Hurt farmers most • Food prices had dropped • Mortgage payments remained the same What did the farmers want? • Bi-metalism & a loose money policy – Dollars backed by gold and silver – Would increase supply of money – Make money cheaper – Increase inflation – Allow them to pay off their debts Which money policy did eastern bankers favor? • Tight or Gold only money policy • Why? • Less money in supply means that its worth more (has more buying power) • Farmers owed them a “fixed” amount of cash (ex. $1000) • $1000 gets them more if less of it is available What was Grover Cleveland’s attitude towards the economy? What other issue affected farmers and laborers? • Tariffs What is a tariff? A tax on imported goods. Imported goods= products made in other countries What kinds of tariffs are there? • Protective – intended to keep identified foreign products out of our country so that Americans will “Buy American!” • Revenue – designed to raise money for the country – calculated to be small enough so as not to curtail trade Revenue Tariff Example: The United States imposes a five percent tariff on foreign wine. Pre tariff price: $20.00 bottle After tariff price: $21.00 bottle Result: Demand will probably not drop much for the product and the imposing country will raise funds. Protective Tariff Example An artificial increase in foreign prices Foreign Steel Cost With 30% Tariff $100 per ton $130 per ton Domestic Steel Cost $120 per ton US Sales Foreign Sales How does a tariff work? Farmers can buy an American tractor for $100 and English tractor for $130 A fledgling American factory makes tractors to sell for $100 each The US Gov. places a $40 fee (tariff) on each English tractor Tractors are transported to America. A steel mill in England makes tractors to sell for $90 each How will foreign nations react to a protective tariff? • retaliate by imposing tariffs on our exports. • IE. Farm products Who is hurt and helped by a protective tariff? Hurt Consumers Exporters Helped Owners of Protected Industries Workers in Protected Industries How did protective tariffs hurt farmers? • Made farm products more expensive overseas • Cut their sales in other nations Election of 1896 Presentation Describe the Election of 1896: • Big Issues: – Bi-metalism – Tariff • Candidates – William Jennings Bryan • Supported by Democrats, Populists, farmers • Great orator/Tireless campaigner – 600 speeches in 14 weeks – Viewed as anti-Catholic by Eastern immigrants – William McKinley • Conservative • “Full dinner pail” • Never left front porch What does Bryan mean by a “cross of gold?” • Gold only money policy is crushing (crucifying) the farmers • Used Biblical imagery in speech • Evangelical style scarred Catholic immigrants • McKinley won decisively Burn down your cites and leave our farms, and your cities will spring up again as if by magic. But destroy our farms and the grass will grow in the streets of every city in the country…you shall not crucify mankind upon a cross of gold.” DBQ • Explain this political cartoon. • Who would support it? A farmer, a businessman? • What does it suggest about the railroad industry? The American Frankenstein 1874