Henry Ford grew up on a farm. Familiar with its labor demands, he directed significant resources of the Ford Motor Company to relieving the brutal work load of the small farmer by building tractors. He sold over a half a million of them in the years leading up to the Great Depression.
He began selling farm tractors about the same time that a Ford dealership was established at the corner of Main Street and what is now Manchester Avenue in Middletown Ohio.
This photo of Dan Snider Ford was taken about 1920. Prominent in the right side window on the showroom floor is a Fordson tractor, the low cost technology that extended the industrial revolution to the small farm throughout the United States in the 1920s.
More than a few who track the introduction and early use of farm mechanization conclude that widespread automation contributed to the economic conditions that led to The Great Depression. One analyst was R. B. Fuller; the following is an excerpt from Chapter 3 of his book “Critical Path”:
“What the bankers did like to support in the new mass productivity was tractor-driven farm machinery. Farm machinery was easy to sell. As the farmer sat atop the demonstration plowing or harvesting equipment, with its power to go through the fields doing an amount of work in a day equal to what had previously taken him weeks, he said to himself, “I can make more money and also take it a little easier.” So the bankers approved the financing of the production and marketing of the farm machinery. They held a chattel mortgage on the machinery and a mortgage on the farmland itself and all its buildings. The bankers loved that. There was enthusiastic bank acceptance of the selling of such equipment “on time” to the farmers. The bankers did not consider this “immoral.” The farmer was “producing food wealth.” The automobilist was “just joy riding.”
Then there came a very bad hog market in 1926. Many farmers were unable to make the payments on their power-driven equipment. The local country banks foreclosed on the delinquent farmers’ mortgages and took away their farms and machinery. The bankers had assumed that the farms were going to be readily saleable. It turned out, however, that there were not so many nonfarmers waiting to become farmers, and most of the real farmers had been put out of business by the bank foreclosures so they couldn’t buy back their own farms. There were no city people eager to go out and buy one of those farms. “How you gonna keep them down on the farm, after they’ve seen Paree?” were the words of a popular World War I song.
So the dust bowls developed as the upturned, unsown soil began to blow off the farms. It is relevant to note that, in 1900, 90 percent of U.S.A. citizens were living and working on the farms; in 1979 only 7 percent were on the farms, mostly as local supervisors for big, absent-ownership corporations. The owners of the farmlands today are no longer “farmers” or even individual humans—they are the great business conglomerates. What began in 1934 as government subsidies and loans to farmers for farm machinery, later to keep acreage out of production, would by 1978 result in President Carter making enormous payments to appease big corporations for cutting off vital grain and other strategic shipments to Russia. Next, the U.S. government would make enormous subsidies to bail out large corporations such as Lockheed and Chrysler, which as basic military suppliers the U.S. government could not allow to go bankrupt. Eventually the U.S. taxpayers will be asked to make “free-of-risk” bail-outs of “private” enterprises, corporations with initial physical assets worth over a billion dollars classifed [sic] as risk enterprises.
We now return to the 1926-’27-’28-’29 sequence of events developing from selling the farmers’ machinery on the bankers’ drop-dead terms (mortgage means “on death terms”). In 1927 and 1928 the bigger Western city banks began to foreclose on their local country banks that had financed the farm machinery sales and had been borrowing from the bigger city banks to cover their unprecedentedly expanded loaning. First the little and then the successively bigger banks found that they had foreclosed on farmhouses that had no indoor toilets, many with roofs falling in, barns in poor condition, with the replevined farm machinery rusting out in the open—and no customers.
Word of the bad news gradually went around; small bank “runs” began; and in 1929 came the Great Crash in the stock market. All business went from worse to worser. Unemployment multiplied. Prices steadily dropped. Nobody had money with which to buy. Bigger and bigger banks had to foreclose on smaller banks, until finally in early 1933 there came one day in which 5000 banks closed their doors to stop “the run” on their funds.”
R. B. Fuller, “Critical Path”, St. Martin’s Press, 1981.
Given the recent financial crisis, Fuller’s analysis is still relevant today. In fact, not much has really changed.
Changes in technology, widely adapted, have profound economic consequences. National forces of technological change can be widespread and gradual, diffused and fragmented by time and place.
Narrowing the focus to a small place over time offers a chance at coherence.
Today the vacant, city-owned building displays neglect.
In the late summer of 2012, a portion of the facade collapsed onto the sidewalk.