How did the following problems affect farmers during the Gilded Age? 1.Debt 2.New machines such as improved plows 3. overproduction of crops 4. rebates 5. short haul vs. long haul ...
How did the following problems affect farmers during the Gilded Age?
1.Debt 2.New machines such as improved plows
3. overproduction of crops 4. rebates
5. short haul vs. long haul 6. cheap money (silver) vs. hard money (gold)
There were several problems facing farmers during the Gilded Age. One problem was debt. Banks had been charging farmers higher interest rates. The farmers felt the banks were unfairly targeting them since the farmers believed other businesses were receiving lower interest rates. Farmers had a hard time repaying their loans, and, as a result, they were losing their farms.
The next two problems are related. As new machinery was introduced, farmers were able to produce more crops. The machines were expensive to buy, which helped cause some of the debt the farmers faced. However, the machines allowed for more crops to be grown and harvested, which led to an oversupply of crops. This caused crop prices to drop, which squeezed the farmers financially.
The railroads were also a problem for farmers. The railroad companies refused to give farmers rebates for shipping their crops on the trains. The railroad companies did give rebates to other businesses that shipped many products. The farmers felt they weren’t being treated fairly. The farmers also didn’t like how the railroad companies charged them high rates to ship crops short distances.
The money policy followed by the United States hurt farmers. Farmers wanted more money in circulation. They wanted a bimetallic money supply, based on gold and silver. This would help them get loans at lower interest rates. It would also allow consumers to have more money available to them to spend on buying products. This would lead to inflation and hopefully raise prices for their crops. However, the government followed a monometallic money policy based only on gold. This made it more difficult for farmers to get loans and allowed less money to circulate in the economy. This kept inflation and prices down. As a result, prices for crops didn’t increase.
We ask that you only ask one question in each post, not six. Because there are so many questions here, my answer to each question will be short.
- Debt was a problem because it farmers had too much of it. This meant that they could easily lose their land to banks and it meant they had to pay a lot of money in interest.
- New machines were relatively expensive. This meant they were harder for small farmers to afford, which helped big farms prosper at the expense of small. They also contributed to overproduction.
- Overproduction leads to lower prices for farmers because excessive supply causes prices to drop.
- Rebates were problems for farmers because farmers did not get them. Large companies could demand rebates from railroads but small farmers couldn’t. Therefore, they ended up paying higher fees.
- When railroads charged high prices for short haul freight and low prices for long haul, it hurt farmers since they often had to send their crops over short distances.
- The cheap money vs. hard money debate hurt farmers because they lost the debate and the government generally supported hard money. A hard money policy meant that there was less money available to be loaned. This makes loans more expensive. It also meant money was worth more (low inflation). Farmers were usually debtors so they wanted cheaper loans. They also wanted inflation so that they could pay their debts off more easily.
Thus, we can say that all of these factors hurt farmers in the Gilded Age.