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  • Decade - 1920s

Why did many American farmers experience financial hardships while the US economy was growing in the 1920s?

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βˆ™ 2010-01-24 13:01:14

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The reason why many American farmers were not able to partake in the Prosperity of the 1920s was mainly due to over-production of Crops. Due to new farm machinery such as tractors and combine harvesters, American farmers were able to produce more food in the twenties than they had ever done before. However they produced more food than the population could eat, so they were left with surplus food. (Not only were America unable to eat the surplus food , they were also unable to export it.) This caused food prices to drop and that meant lower incomes for farmers and farm workers. Farmers tried to keep up their incomes by growing even more food, but this made food prices fall even lower: the bigger the surplus, the lower the price. Thousands of farmers tried to get out of their difficulties by borrowing money from banks. Farmers took out mortgages worth $ 2000 million during the twenties however this made their problems worse. As their incomes continued to drop they could not repay the mortgage and so the banks ended their mortgages and threw them off their land. By 1929 millions of farmers were living in poverty, with basic necessities such as food, and electricity or mains water.
2010-01-24 13:01:14
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