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Populism and Free Silver in the 1890s aka: The Wizard of Oz meets Monetary Policy Get your clicker! Ch 48!

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Presentation on theme: "Populism and Free Silver in the 1890s aka: The Wizard of Oz meets Monetary Policy Get your clicker! Ch 48!"— Presentation transcript:

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

3 Goals: SWBAT… Identify and explain basic micro and macro economic ideas 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 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 Examine The Wizard of Oz as a Monetary Allegory http://thefedorachronicles.com/hollywood/Movies/WizardofOz.html

4 Our Agenda Today Economics Basics Economics Basics Late 1800s Monetary Policy Late 1800s Monetary Policy Populism and the Wizard of Oz Populism and the Wizard of Oz

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

6 Intro to Econ: Key Terms Demand, Supply, and Price Demand, Supply, and Price Fiscal Policy Fiscal Policy Monetary Policy Monetary Policy Money Supply Money Supply Business Cycle Business Cycle Tariff Tariff Recession Recession Inflation and Deflation Inflation and Deflation http://www.thebluecollarinvestor.com/blog/wp-content/uploads/2008/11/business-cycle-graph-better.jpg

7 http://priyankaseconomicblog.files.wordpress.com/2009/10/calvin-on-supply-and-demand3.jpg

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

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

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

11 Economics of the 1890s Very high tariffs (taxes on imports) Very high tariffs (taxes on imports) Agric. prices down (1860s to 1890s) Agric. prices down (1860s to 1890s) Depression of 1893 Depression of 1893 Why did farmers want inflation? Why did farmers want inflation? http://www.flickr.com/photos/farlane/3791930988/in/set-72157601329141029/

12 Economics of the 1890s

13 Economics of 1890s Is inflation bad? Is inflation bad? Yes for creditors (i.e., bankers) Yes for creditors (i.e., bankers) No for debtors (i.e., farmers) No for debtors (i.e., farmers) Some inflation is healthy, necessary Some inflation is healthy, necessary Why did farmers want inflation? Why did farmers want inflation? http://www.cthistoryonline.org/cdm-cho/cho/journeys/j_life_rural_farm.html

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

15 Government and Economy A Short Digression… Capitalism? Capitalism? Communism? Communism? Socialism? Socialism?

16 Government and Economy A Short Digression… Capitalism? Capitalism? Adam Smith Adam Smith The Wealth of Nations (1776) The Wealth of Nations (1776) Laissez Faire, Free Market should replace Mercantilism Laissez Faire, Free Market should replace Mercantilism Allow for competition to naturally regulate economy Allow for competition to naturally regulate economy

17 Government and Economy A Short Digression… Communism? Communism? Karl Marx and Friedrich Engels Karl Marx and Friedrich Engels The Communist Manifesto (1848) The Communist Manifesto (1848) Capitalism will collapse, Proletariat will rise up and overthrow Bourgeoisie Capitalism will collapse, Proletariat will rise up and overthrow Bourgeoisie Stateless, Classless Total equality Stateless, Classless Total equality Not quite Lenin or Mao Not quite Lenin or Mao

18 Government and Economy A Short Digression… Socialism? Socialism? Great variation Great variation Parts of W. Europe and N. America today Parts of W. Europe and N. America today Government control or regulation of some parts of economy Government control or regulation of some parts of economy Schools, healthcare, natural monopolies; More worker and consumer protection Schools, healthcare, natural monopolies; More worker and consumer protection

19 Government and Economy How can the government influence the economy? How can the government influence the economy? Fiscal Policy: taxes and/or spending Fiscal Policy: taxes and/or spending Monetary Policy: money supply and/or interest rates Monetary Policy: money supply and/or interest rates Today the Federal Reserve Bank (The FED) is in charge of Monetary Policy Today the Federal Reserve Bank (The FED) is in charge of Monetary Policy http://www.fotosearch.com/illustration/inflation.html

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

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

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

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

24 Government and Economy Monetary Policy During the 1800s: It was a mess! It was a mess! Banks, States, and Federal govt printed money Banks, States, and Federal govt printed money First Bank of the US (1791-1811) First Bank of the US (1791-1811) Second Bank of the US (1816-1836) Second Bank of the US (1816-1836) Federal govt wanted no debt Federal govt wanted no debt

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

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

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

28 Government and Economy Monetary Policy During the 1800s: Greshams Law named for Sir Thomas Gresham (1519-1579) Greshams Law named for Sir Thomas Gresham (1519-1579) When a government compulsorily overvalues one type of money and undervalues another, the undervalued money will leave the country or disappear aka: Bad money drives out good money

29 Government and Economy Monetary Policy During the 1800s: According to Greshams Law, if Populists get their way, Gold is…. According to Greshams Law, if Populists get their way, Gold is…. Good Money that will be undervalued and driven out of circulation, perhaps out of the country Bankers think silver is bad

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

31 The Rise of Populism Tariff very high Tariff very high Farmers caught in a debt cycle Farmers caught in a debt cycle 1869-1896 crop prices down 55 percent! Farmers Revolted and Organized! Farmers Revolted and Organized! Granger movement (1860s to 1880s) Farmers Alliance (1880s) People s Party formed in 1890s 1894 Unemployment over 18 percent 1894 Unemployment over 18 percent

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

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

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

35 The Wizard of Oz Book written by Frank Baum in 1900 Book written by Frank Baum in 1900 Movie in 1939 Movie in 1939 What s the story? What s the story? http://thefedorachronicles.com/hollywood/Movies/WizardofOz.html

36 The Wizard of Oz Story begins in the West (Kansas) as did Populists Story begins in the West (Kansas) as did Populists http://thefedorachronicles.com/hollywood/Movies/WizardofOz.html Dorothy? Heroine from poor farm Heroine from poor farm Represents honest, plucky America Represents honest, plucky America Mary Elizabeth Lease? Mary Elizabeth Lease?

37 The Wizard of Oz Cyclone/Tornado = Free Silver Movement Cyclone/Tornado = Free Silver Movement http://thefedorachronicles.com/hollywood/Movies/WizardofOz.html The Land of Oz? The Gold Standard The Gold Standard Oz = Gold (ounce) Oz = Gold (ounce) http://babycreativeblog.files.wordpress.com/2009/10/tornado-4.jpg http://www.open2.net/blogs/media/blogs/39197167_gold.jpg

38 The Wizard of Oz Wicked Witch of the East (WWE) House lands on and kills House lands on and kills Silver shoes put on Dorothy Silver shoes put on Dorothy http://www.physicsdaily.com/physics/Grover_Clevelandhttp://www.babygadget.net/pics/silver-shoes.jpg = Eastern business interests, Grover Cleveland = Eastern business interests, Grover Cleveland

39 The Wizard of Oz Yellow Brick Road? http://www.lonelyplanet.com/maps/north-america/usa/washington-dc/map_of_washington-dc.jpg = Gold = Gold Emerald City? Washington DC Washington DC http://thefedorachronicles.com/hollywood/Movies/WizardofOz.html

40 http://www.flickr.com/photos/farlane/3791930988/in/set-72157601329141029/ The Wizard of Oz Scarecrow needs? Appear brainless, but smart Appear brainless, but smart = western farmers = western farmers

41 The Wizard of Oz Tin Woodman needs? http://thefedorachronicles.com/hollywood/Movies/WizardofOz.html http://www.uni.edu/schneidj/webquests/adayinthelife/lotsofworkers.jpg = industrial workers = industrial workers Once flesh and blood; needs bigger, kinder heart Once flesh and blood; needs bigger, kinder heart

42 The Wizard of Oz Cowardly Lion needs? http://www.old-picture.com/american-history-1900-1930s/pictures/Jennings-William-Jennings.jpg = WJB = WJB Fell asleep in….? Fell asleep in….? Poppy Fields = Imperialism Poppy Fields = Imperialism http://thefedorachronicles.com/hollywood/Movies/WizardofOz.html Stopped fighting for silver Stopped fighting for silver

43 The Wizard of Oz Travel to Emerald City? http://thefedorachronicles.com/hollywood/Movies/WizardofOz.html = Coxey s march to DC for job in 1894 = Coxey s march to DC for job in 1894 Emerald Palace? = White House = White House Seven passages & three flights of stairs? Seven passages & three flights of stairs? = Crime of 73 = Crime of 73 http://blogs.ancestry.com/circle/wp- content/uploads/2008/08/Coxeys%20Army.bmp http://www.destination360.com/north-america/us/washington-dc/white-house

44 The Wizard of Oz Dorothy and Friends must? http://thefedorachronicles.com/hollywood/Movies/WizardofOz.html WWW = McKinley WWW = McKinley Fate of WWW? Melts with water Melts with water Farmers in West need rain to counter drought Farmers in West need rain to counter drought Rain = inflation Rain = inflation http://4.bp.blogspot.com/_RMIeFF2Drjg/Snn9B2F1yNI/AAAAAAAABR8/62cV VZGoBUM/s400/Mckinley.jpg Kill Wicked Witch of the West Kill Wicked Witch of the West

45 The Wizard of Oz The Wizard? http://thefedorachronicles.com/hollywood/Movies/WizardofOz.html = Marcus Alonzo Hanna, an advisor to McKinley & head of RNC = Marcus Alonzo Hanna, an advisor to McKinley & head of RNC www.nndb.com/people/013/000101707/

46 The Wizard of Oz Wizard turns out to be ordinary http://thefedorachronicles.com/hollywood/Movies/WizardofOz.html Gang seeks help from Good Witch of the South problems are fixed problems are fixed Dorothy uses silver shoes to return to Kansas Dorothy uses silver shoes to return to Kansas http://www.starpulse.com/Movies/Wizard_Of_Oz,_The/gallery/WIZARDOZ007/ = supporters in South = supporters in South

47 How did we do? SWBAT… Identify and explain basic micro and macro economic ideas 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 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 Examine The Wizard of Oz as a Monetary Allegory http://bigpicture.typepad.com/comments/images/2008/07/14/inflation_recession_alligator.jpg

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

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

50 Thanks and have a great day! http://thefedorachronicles.com/hollywood/Movies/WizardofOz.html


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