THE GREAT WEST
UNIT 8
POPULISM AND THE UNITING OF FARMERS
As farmers in the South and the Midwest found their voices unheard by the eastern elites and politicians, a rising
movement grew on the farms and in the factories of those downtrodden who felt it was past due for the voice of the
common man to be heard.
THE PLIGHT OF FARMERS
To pay for the Civil War the United States had increased its money supply by issuing millions of dollars in
greenbacks (paper currency) that could not be exchanged for gold or silver coins.
- this increase in money supply without an increase in goods for sale led to inflation – a decline in the
value of money.
- as the paper money lost its value, the prices of goods (crops) soared  farmers happy
Soon after the Civil War, the government began pulling greenbacks out of circulation and stopped making silver into
coins leading to a decrease in greenbacks and money that led to deflation – increase in the value of money
- many farmers had borrowed money to buy seed and equipment causing debt with ever increasing
interest at a time when prices for crops was falling fast due to deflation
- also with the opening of the West more and more farmers were growing crops that led to the drop in
prices for crops due to the increase in supply  farmers not happy
In addition, railroads were giving large rebates to large companies and passing the cost onto the farmers
rebate – a partial refund to lower the rate of a good or commodity
at every turn farmers were being taken advantage of and loosing money
AGRARIAN REVOLT
Outrageous railroad charges to haul crops along with declining food prices and rising debt led many farmers to unite
Grange (1867) – organization of farmers that banded together for political and economic benefits and interests
created by Oliver Kelly
helped establish local and state laws to regulate and control the railroads with the goal government
controlled railroads
Munn v. Illinois (1877) – upheld state regulations of the railroads declaring private property could be regulated by
state/federal government when such regulations would benefit the public good
Farmers' Alliances (1877) – as farmers in the South and West found it increasingly difficult to survive
economically, farmer’s alliances moved to the forefront of the farmers struggle in the 1880s
- formed cooperatives which combined goods and sold them together to give more power to farmers 
strength in numbers
- alliance agenda included government control of transportation and reforms of currency, land ownership,
and income tax policies
- regional and racial alliance popped up across the nation such as the Northern Alliance, Southern Alliance
and Colored Farmers’ Alliance
Wabash v. Illinois (1886) – ruled that regulating railroad rates in interstate commerce is under the authority of
Congress and that the states have no authority to do so
- government stops supporting farmers in favor of railroads who they supported financially (subsidies)
- pressure from Farmer’s Alliances after the ruling led to the Interstate Commerce Act
Interstate Commerce Act (1887) – created the 5-person Interstate Commerce Commission, which was the first true
federal regulatory agency designed to address the issues of railroad abuse and discrimination
required the shipping rates to be reasonable, just, and public
secret rebates and price discrimination against small markets was made illegal
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ENTER POPULISM
As it became clear that their alliances could not succeed without legislative changes, and as major-party politicians
whom they had supported proved undependable once in office, the Farmer’s Alliances took the lead in creating a
movement that would lead to a new national farm-labor party
Populism – movement created to increase the political power and influence of rural farmers and urban workers and
to increase legislation that benefited both of them
People's (Populist) Party (1892) – political party formed to address and voice the concerns of farmers and
labors against the eastern elites
Omaha Platform – the Populist’s platform, which called for government ownership of transportation, an
increase in the money supply (silver, paper greenbacks), a progressive income tax, the direct election of
senators by voters, the eight-hour day, and a new federal loan program
Panic of 1893 – the nation fell into the worst economic depression it had ever experienced at that time due to big
railroad failure from quick expansion without the ability to repay loans
- this led to a crash on Wall Street, bank closures, and questions about how to solve the nation’s economic
crisis
Two different viewpoints on the how the monetary system in the United States should be backed:
Gold Standard – paper money would be backed only by gold
- expensive, but more stable currency supported by bankers and businessmen of the eastern elite
Bimetallism – paper money would be backed by gold and silver
- more currency with less value supported by farmers
Election of 1896 – election with the showdown between how to back the monetary system being at the forefront
- Republicans and eastern elites endorsed William McKinley who campaigned for the Gold Standard
- Populists and Democrats both endorsed William Jennings for President
- Bryan campaigned against the Gold Standard delivering a speech known as “The Cross of Gold” speech.
“…we will answer their demand for a gold standard by saying: You shall not press down upon the brow of labor
this crown of thorns; you shall not crucify mankind upon a cross of gold.”
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the Democrats proposed a monetary system based on both gold and silver known as bimetallism
Gold Standard won out with the election of McKinley,
In 1900, the United States officially adopted the gold standard with the Gold Standard Act thanks to increase in the
gold supply after gold was discovered in Alaska and the Yukon Territory of Canada. Although Populism failed to
achieve its goals at the end of the 19th century the movement didn’t vanish but transformed into a more urban
movement that took on Populist reforms effort in a new early 20th century movement called Progressivism.
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