2. Populism and Free Silver in the 1890s
aka: The Wizard of Oz meets Monetary Policy
NEW INFO: Socialism?
Get your clicker! Ch 48!

3. Goals: SWBAT…
Identify and explain basic micro and macro economic ideas
Apply these ideas to explain and analyze the Populist and Free Silver movements of the 1890s
Examine The Wizard of Oz as a Monetary Allegory

4. I understand the economics behind Populism and Free Silver.
1- Strongly disagree
2- Disagree
3- Agree
4- Strongly agree

5. Intro to Econ: Key Terms
Demand, Supply, and Price
Fiscal Policy
Monetary Policy
Money Supply
Business Cycle
Tariff
Recession
Inflation and Deflation

6. http://priyankaseconomicblog. files. wordpress

7. Intro to Econ What causes prices to go up?
Demand Change vs. Supply Change
Inflation vs. Deflation

8. Economics of the 1890s If Demand goes down…. If Supply goes up….
DEFLATION! Prices go down!
What was happening to crop prices in the late 1800s? Why?
What was happening to farm costs (i.e., mortgages, manuf. goods) in the late 1800s? Why?

9. I have a better understanding of how supply and demand impact prices.
1- Strongly disagree
2- Disagree
3- Agree
4- Strongly agree

10. Economics of the 1890s Very high tariffs (taxes on imports)
Agric. prices down (1860s to 1890s)
Depression of 1893
Why did farmers want inflation?

11. Economics of 1890s Is inflation bad? Yes for creditors (i.e., bankers)
No for debtors (i.e., farmers)
Some inflation is healthy, necessary
Why did farmers want inflation?

12. The government should have helped farmers more.
1- Strongly disagree
2- Disagree
3- Agree
4- Strongly agree

13. Government and Economy
How can the government influence the economy?
Fiscal Policy: taxes and/or spending
Monetary Policy: money supply and/or interest rates
Today the Federal Reserve Bank (The FED) is in charge of Monetary Policy

14. Government and Economy
Traditional Economics?
Mercantilism  Free Market Capitalism
Wealth of Nations by Adam Smith (1776)
The Government should stay out of the economy
Recessions are good!
Reality?

15. Government and Economy
Monetary Policy to stimulate the economy…
Increase the money supply and/or lower interest rates
Risks?
Could lead to inflation, but unlikely
if in a recession
WARNING: The economy is a moving target!

16. Government and Economy
Recessions During the 1800s:
Panic of 1819
Panic of 1837
Panic of 1857
Panic of 1873
Depression of 1893
(FYI – Great Depression begins in 1929)

17. Government and Economy
High Tariffs During the 1800s:
Tariff of 1816 – 15 to 20 percent
Tariff of 1824 – Whig Party and Henry Clay
Tariff of 1828 – 50 percent
Tariff of 1832 – down slightly
Tariff of 1857 – Democrats lower tariff
Morrill Tariff of 1861 – 47 percent
“mongrel” Tariff Act of 1883
McKinley Tariff Act of 1890
Dingley Tariff of 1897 – over 50 percent!
(FYI – Hawley-Smoot Tariff of 1930)

18. Government and Economy
Monetary Policy During the 1800s:
It was a mess!
First Bank of the US ( )
Second Bank of the US ( )
Banks, States, and Federal govt printed money
Federal govt wanted no debt

19. Government and Economy
Monetary Policy During the 1800s:
Mint Act of 1792
unlimited Silver & Gold at 15:1
“Crime of 1873” – govt. stopped minting silver
USA essentially on gold standard in 1879
Sherman Silver Purchase Act (1890) not enough, and soon repealed

20. Government and Economy
Monetary Policy During the 1800s:
Market value vs. Official value
By 1894 Market value was over 30: (i.e., 30 silver = 1 gold)
Populists wanted govt to resume minting silver at 16:1
FREE SILVER!!

21. Government and Economy
Monetary Policy During the 1800s:
What if Govt minted silver at 16:1 in 1890s?
Money Supply?
Increase! But gold deposits would go down
Inflation?
Not likely since recession

22. I have a better understanding of U. S
I have a better understanding of U.S. government monetary policy of the 1800s.
1- Strongly disagree
2- Disagree
3- Agree
4- Strongly agree

23. The Rise of Populism 1894 Unemployment over 18 percent
Tariff very high
Farmers caught in a debt cycle
crop prices down 55 percent!
Farmers Revolted and Organized!
Granger movement (1860s to 1880s)
Farmers Alliance (1880s)
People’s Party formed in 1890s

24. The Election of 1896 Republicans endorsed William McKinley
High tariffs and gold standard
Conservative “sound money” position
Democrats and Populists
endorsed William Jennings Bryan
Bimetallic standard (silver & gold) at 16:1
WJB gave “Cross of Gold” speech

25. The Election of 1896 Republicans/McKinley won!
Democrats became party of “progressive” reform
Populist party fades away; many positions adopted by Democrats

26. The Election of 1896 Free Silver issue disappears: WHY?
Gold Discoveries in 1880s and 1890s
By 1897 Economy was improving
1900 Gold Standard Act
New focus in Imperialism

27. The Wizard of Oz Book written by Frank Baum in 1900 Movie in 1939
What’s the story?

28. The Wizard of Oz Story begins in the West (Kansas) as did Populists
Dorothy?
Heroine from poor farm
Represents honest, plucky America
Mary Elizabeth Lease?

29. The Wizard of Oz Cyclone/Tornado = Free Silver Movement
The Land of Oz?
The Gold Standard
Oz = Gold (ounce)

30. The Wizard of Oz Wicked Witch of the East (WWE)
House lands on and kills
= Eastern business interests, Grover Cleveland
Silver shoes put on Dorothy

31. The Wizard of Oz Yellow Brick Road? = Gold Emerald City? Washington DC

32. The Wizard of Oz Scarecrow needs? Appear brainless, but smart
= western farmers

33. The Wizard of Oz Tin Woodman needs?
Once flesh and blood; needs bigger, kinder heart
= industrial workers

34. The Wizard of Oz Cowardly Lion needs? = WJB
Stopped fighting for silver
Fell asleep in….?
Poppy Fields = Imperialism

35. The Wizard of Oz Travel to Emerald City?
= Coxey’s march to DC for job in 1894
Emerald Palace?
= White House
Seven passages & three flights of stairs?
= Crime of ‘73

36. The Wizard of Oz Dorothy and Friends must?
Kill Wicked Witch of the West
WWW = McKinley
Fate of WWW?
Melts with water
Farmers in West need rain to counter drought
Rain = inflation

37. The Wizard of Oz The Wizard?
= Marcus Alonzo Hanna, an advisor to McKinley & head of RNC

38. The Wizard of Oz Wizard turns out to be ordinary
Gang seeks help from Good Witch of the South
= supporters in South
problems are fixed
Dorothy uses silver shoes to return to Kansas

39. How did we do? SWBAT…
Identify and explain basic micro and macro economic ideas
Apply these ideas to explain and analyze the Populist and Free Silver movements of the 1890s
Examine The Wizard of Oz as a Monetary Allegory

40. I think the Wizard of Oz accurately reflects the people and issues of the 1890s.
1- Strongly disagree
2- Disagree
3- Agree
4- Strongly agree

41. I understand the economics behind Populism and Free Silver.
1- Strongly disagree
2- Disagree
3- Agree
4- Strongly agree

42. Thanks and have a great day!