1. Populism
Chapter 16 Section 2

2. Rural America
Populism – mvmt to increase farmers’ political power and to work for legislation in their interest
Problems of the farmers
Farm prices had dropped due to new technology
Production of more crops  more supply leads to lower prices

3. Problems of farmers cont’d
Rural America
Problems of farmers cont’d
High tariffs
Increased the cost of manufactured goods – which farmers needed
Harder for farmers to sell their goods overseas
Felt victimized by
Banks – financed their loans
Railroads – set their shipping rates

4. Money Problems
Greenbacks – paper currency that could not be exchanged for gold or silver coins
Caused inflation
Inflation – decline in the value of money
As paper money lost value, the prices of goods soared

5. Money Problems To get inflation under control the govt.
Stopped printing greenbacks
Stopped making silver into coins
Started paying off its bonds
The US did not have enough money supply to meet the needs of the country’s growing economy  leads to deflation
Deflation – increase in the value of money
Money increased in value  prices b/g to fall

6. Money Problems
Most farmers had to borrow money for seed and other supplies to plant their crops
Interest rates rose
Increased the amount farmers owed
With deflation, farmers sell their crop for less
But they still had the same mortgage payment

7. Money Problems By 1873 the nation was in a severe recession
Farm income fell sharply
Farmers b/g to realize they would have to organize to get the govt. to meet their needs

8. The Grange
The Grange – nation’s first national farm organization – founded by Oliver Kelley
Grangers responded to the economic crisis in 3 ways
Pressured state legislatures to regulate railroad and warehouse rates
Joined the Independent National Party (the Greenback Party)
Wanted the govt. to print more greenbacks to increase money supply

9. The Grange
Tried to create cooperatives – marketing organizations that worked for the benefit of their members
Cooperatives pooled farmers’ crops and held them off the market in order to force up prices
None of these strategies improved farmers’ economic condition
Farmers b/g to move to new organizations they hoped could really help

10. The Farmers’ Alliance Goals of the Farmers’ Alliance
Tried to help farmers with their economic situation
They did not want to undermine Democratic control of the South
Produced a list of demands and supported the candidates who supported their demands
Their demands  the Subtreasury Plan

11. Farmers’ Demands The Subtreasury Plan
Govt. set up warehouses called subtreasuries
Farmers store crops in the warehouses
The govt. would provide low interest loans to the farmers
The farmers hoped that this plan would…
Hold their crops off the market in large enough quantities to force the prices up
Democrats would adopt the plan and win the farmers’ vote

12. The People’s Party
Some Farmers’ Alliance leaders felt the organization was failing at helping the farmers
They formed the People’s Party (Populists)
Populists – a new political party
Eventually the Farmers’ Alliance broke and stopped supporting Democrats
They went to the Populist Party

13. Election of 1892
The Populists nominated James B. Weaver as their presidential candidate
His platform called for …
Unlimited coinage of silver
Federal ownership of railroads
Graduated income tax – tax higher earnings more heavily
Stronger govt. to protect the public from greedy and irresponsible private interests
Cleveland – a Democratic wins the election

14. Panic of 1893
Worst economic crisis in the nation’s history – up to this point
B/g with the Philadelphia and Reading Railroads filing bankruptcy
Could not repay their loans
Stock Market crashed
Banks closed
Approx. 18% of the workforce was either unemployed or on strike

15. Goldbugs and Silverites
The Democratic Party split into 2 factions…
Goldbugs – b/l the American currency should be based only on gold
Silverites – b/l coining silver in unlimited quantities would solve the nation’s economic crisis
Cleveland (president at the time) was a goldbug

16. Election of 1896 Main Issue… Republicans nominate William McKinley
Are you a goldbug or a silverite?
How do we get out of the depression?
Republicans nominate William McKinley
Goldbug
“Full dinner pale” and Front-Porch Campaign
Appealed to urban areas and urban workers
Blame Cleveland and the Democrats for the depression

17. Election of 1896 Democrats nominate William Jennings Bryan
Silverite
Silver campaign
Appealed to southern and western farmers
Populists – joined with the Democrats so not to split the silver vote
McKinley won
Silver crusade and Populism died out