On July 4, 1890, Leonidas L. Polk took a political gamble. He stepped up to make a speech

to a crowd of 6,000 in a small town in Kansas. Polk was a Southerner, a lifelong Democrat,

and a former Confederate soldier. He was not in friendly territory.

Polk had come to Kansas because he was now involved in a different kind of battle,

one that cut across the lines dividing Northerners from Southerners and Democrats from

Republicans. He was calling on farmers from both parties and both regions to unite for their

common good. Polk urged the crowd to reject the two-party system and join the emerging

movement that became known as populism:

“I tell you this afternoon that from New York to the Golden Gate, the farmers have risen

up and have inaugurated a movement such as the world has never seen. It is a revolution of

thought. . . . The farmer of North Carolina, Georgia, Texas, South Carolina is your

brother. . . . Some people have stirred up sectional feelings and have kept us apart for

twenty-five years. . . . They know that if we get together and shake hands . . . their doom is

sealed. . . . Congress could give us a bill in forty-eight hours that would relieve us, but Wall

Street says nay. . . . I believe that both of the parties are afraid of Wall Street.”—quoted in Democratic Promise: The Populist Movement in America

1867Grange foundedto aid farmers

500 CHAPTER 16 Politics and Reform

✦1875 ✦1895

Unrest in Rural AmericaPopulism was the movement to increase farmers’ political power and to work for

legislation in their interest. The economic crisis that drove farmers to embrace thismovement had its origins in the years immediately following the Civil War. A major

Populism

Main IdeaIn the 1890s an independent politicalmovement called populism emerged tochallenge the two major parties.

Key Terms and Namespopulism, greenback, inflation, deflation,Grange, cooperative, People’s Party,graduated income tax, goldbug, silverite,William Jennings Bryan

Reading StrategyTaking Notes As you read about theemergence of populism in the 1890s, usethe major headings of the section to create an outline similar to the onebelow.

Reading Objectives• Explain why farmers wanted a green-

back currency and why the adoption ofthe gold standard led to the Farmers’Alliance.

• Describe who joined the Populist Partyand what the party’s goals were.

Section ThemeEconomic Factors Currency and creditproblems led to the rise of the Populistmovement.

✦1865 ✦1885

1873Congress adopts a goldstandard for currency

1877Farmers’ Alliancefounded in Texas

1892National People’sParty formed

1890People’s Partyformed in Kansas

Populist farmers gather inDickinson County, Kansas

PopulismI. Unrest in Rural America

A.B.

II.A.B.

problem was that farm prices had dropped due tonew technology. Farmers were producing morecrops, and greater supply tended to lower prices. Atthe same time, high tariffs increased the cost of man-ufactured goods farmers needed and made it harderfor farmers to sell their goods overseas. Farmers alsofelt they were victimized by large and faraway enti-ties: the banks from which they obtained loans andthe railroads that set their shipping rates. The worldthat farmers now dealt with was more and more oneof big business, and they felt they were losing powerand influence.

The Money Supply One specific problem thatgreatly concerned farmers was the nation’s moneysupply. To help finance the Union war effort, theUnited States Treasury had greatly expanded themoney supply by issuing millions of dollars ingreenbacks—paper currency that could not beexchanged for gold or silver coins. This rapidincrease in the money supply without an accompa-nying increase in goods for sale caused inflation, or adecline in the value of money. As the paper moneylost value, the prices of goods soared.

After the Civil War ended, the United States hadthree types of currency in circulation—greenbacks,gold and silver coins, and national bank notes backedby government bonds. To get inflation under control,

the federal government stopped printing greenbacksand began paying off its bonds. In 1873 Congress alsodecided to stop making silver into coins.

These decisions meant that the United States didnot have a large enough money supply to meet theneeds of the country’s growing economy. In 1865, forexample, there was about $30 in circulation for eachAmerican, but by 1895 it had sunk to about $23. Asthe economy expanded, deflation—or an increase inthe value of money and a decrease in the generallevel of prices—began. As money increased in value,prices began to fall.

Deflation Hurts Farmers Deflation hit farmersespecially hard. Most farmers had to borrow moneyfor seed and other supplies to plant their crops.Because money was in short supply, interest ratesbegan to rise, which increased the amount farmersowed. For those who wanted to expand their farms,rising interest rates also made mortgages moreexpensive. The falling prices of the period of defla-tion meant the farmers sold their crops for less.Nevertheless, they still had to make the same mort-gage payments to the banks.

Realizing that their problems were due to a short-age of currency, many farmers concluded thatEastern bankers had pressured Congress into reduc-ing the money supply. Some farmers called for the

Populist Territory This farm family in Nebraska represents the kind of people who typically supportedpopulism. Why did farmers dislike Eastern bankers?

History

printing of more greenbacks to expand the moneysupply. Others, particularly those living in the Westwhere new silver mines had been found, wanted thegovernment to begin minting silver coins. Theyreferred to the decision to stop minting silver as “TheCrime of ’73.” Increasingly, farmers realized that ifthey were going to convince the government to meettheir demands, they needed to organize.

The Grange Takes Action In 1866 the United StatesDepartment of Agriculture sent Oliver H. Kelley totour the rural South and report on the condition of theregion’s farmers. Realizing how isolated the farmerswere from each other, the following year, Kelleyfounded the nation’s first national farm organization,the Patrons of Husbandry, better known as the Grange.

At first Grangers got together largely for socialand educational purposes. Then, in 1873, the nationplunged into a severe recession, and farm income fellsharply. Farmers looking for help joined the Grangein large numbers. By 1874 the Grange had between800,000 and 1.5 million members.

Grangers responded to the crisis in three ways.Some pressured state legislatures to regulate railroadand warehouse rates, which they believed were toohigh. Others joined the Independent National Party.This new political party, nicknamed the GreenbackParty, wanted the government to print more green-backs to increase the money supply. Grangers alsopooled their resources and tried to createcooperatives—marketing organizations that workedfor the benefit of their members.

One of the reasons farmers could not chargehigher prices for their crops was that there were somany farmers in competition. If a farmer raisedprices, a buyer could always go elsewhere and pay

less. Cooperatives pooled farmers’ crops and heldthem off the market in order to force up prices.Because a cooperative controlled a large quantity offarm products, it could also negotiate better shippingrates with the railroads.

The Grange Fails None of the strategies theGrangers employed improved farmers’ economiccondition. Several western states passed “Grangerlaws” setting maximum rates and prohibiting rail-roads from charging more for short hauls than forlong ones. The railroads fought back by cutting serv-ices and refusing to lay new track until the laws wererepealed. The 1886 Supreme Court ruling in Wabash

v. Illinois then greatly limited the states’ ability to reg-ulate railroads by ruling that states could not regu-late commerce that crossed state lines. ; (See pages

496 and 1083 for more information on Wabash v. Illinois.)

Meanwhile the Greenback Party failed to gainmuch public support. Many Americans were very sus-picious of paper money. They did not believe it wouldhold its value, and they considered the GreenbackParty’s proposal to print more paper money danger-ous for the economy. The Grange’s cooperatives alsofailed, partly because they were too small to have anyeffect on prices, and partly because Eastern businessesand railroads considered them to be similar tounions—illegitimate conspiracies in restraint oftrade—and refused to do business with them. By thelate 1870s, membership in the Grange had begun tofall, as farmers moved to other organizations that theyhoped would better address their problems.

The Farmers’ AllianceEven as the Grange began to fall apart, a new

organization, known as the Farmers’ Alliance, beganto form. The Farmers’ Alliance began in LampasasCounty, Texas, in 1877. By 1885 it had built a substan-tial following throughout the state. The followingyear, Charles W. Macune became the leader of theAlliance. Macune called for the organization to beginrecruiting farmers outside of Texas.

The Alliance Grows During the late 1880s, Alliancemembers traveled across the South and West speak-ing to farmers and organizing local chapters. By 1890the Alliance had between 1.5 and 3 million members.Its support was very strong in the South and on theGreat Plains, particularly in Kansas, Nebraska, andNorth and South Dakota.

When Macune became the leader of the Alliance,he also announced a plan to organize very largecooperatives that the Alliance called exchanges.

Farmers’ Alliance This small band of farmers met in a cabin inLampasas County, Texas, to form the Farmers’ Alliance.

Macune hoped these exchanges would be big enoughto force farm prices up and to make loans to farmersat low interest rates. The exchanges had some suc-cess. The Texas Exchange successfully marketed cot-ton at prices slightly higher than those paid toindividual farmers, while the Illinois Exchange nego-tiated slightly better railroad rates for wheat farmers.

The People’s Party Despite their temporary suc-cess, the large cooperatives failed for several reasons.Many overextended themselves by loaning too muchmoney at low interest rates that was never repaid. Inmany cases, wholesalers, manufacturers, railroads,and bankers discriminated against them, making itdifficult for them to stay in business. The exchangesalso failed because they still were too small to dra-matically affect world prices for farm products.

By 1890 the failure of the Alliance to fix farmers’problems had started a power struggle within theorganization. Some Alliance leaders, particularly inthe Western states, wanted to form a new party andpush for political reforms. Members of the KansasAlliance formed the People’s Party, also known asthe Populists, and nominated candidates to run forCongress and the state legislature. Alliances inNebraska, South Dakota, and Minnesota quickly fol-lowed Kansas’s example.

The Subtreasury Plan Most Southern leaders ofthe Alliance, including Charles Macune, opposed theidea of a third party. They did not want to underminethe Democrats’ control of the South. Instead, Macunesuggested that the Alliance produce a list of demandsand promise to vote for candidates who supportedthose demands. He hoped this strategy would forcethe Democrats to adopt the Alliance program.

As part of this strategy, Macune introduced thesubtreasury plan, which called for the government toset up warehouses called subtreasuries. Farmerswould store the crops in the warehouses, and thegovernment would provide low-interest loans to thefarmers. Macune believed that the plan would allowfarmers to hold their crops off the market in largeenough quantities to force prices up. He hoped thatthe Democrats would adopt the subtreasury plan andthereby win farmers’ votes.

Explaining How did the Farmers’Alliance try to help farmers?

The Rise of Populism In 1890 members of the Farmers’Alliance met in

Ocala, Florida, and issued what came to be known asthe Ocala Demands. These demands were intended

Reading Check

CHAPTER 16 Politics and Reform 503

History

Hard Labor Southern farmers spent long hours working in their fields. Harvesting cotton (left) and husking corn(right) were family activities that were done by hand with no expensive mechanical equipment. What do younotice about the ages of the group husking corn?

to guide farmers in choosing whom to vote for in1890. The demands called for the adoption of the sub-treasury plan, the free coinage of silver, an end toprotective tariffs and national banks, tighter regula-tion of the railroads, and direct election of senatorsby voters instead of by state legislatures.

To prevent farmers from voting for Populists, theRepublicans in Congress, led by Senator JohnSherman, pushed through the Sherman SilverPurchase Act of 1890. This act authorized the UnitedStates Treasury to purchase 4.5 million ounces of sil-ver per month. It put more money into circulationand may have reduced the deflation slightly, but itdid little to help the farmers.

The midterm elections of 1890 seemed to suggestthat both the Southern and Western strategies hadworked for the farmers. In the South, four gover-nors, all Democrats, were elected after promising tosupport the Alliance program. Several Southern leg-islatures now had pro-Alliance majorities, and over40 Democrats who supported the Alliance programwere elected to Congress. Meanwhile, the newPeople’s Party did equally well in the West.Populists took control of the Kansas and Nebraskalegislatures. Populists also held the balance ofpower in Minnesota and South Dakota. EightPopulists were elected to the U.S. House ofRepresentatives and two to the Senate.

The South Turns to Populism At first Southernmembers were excited over their success in electingso many pro-Alliance Democrats to Congress andSouthern state legislatures, but over the next twoyears, their excitement turned into frustration.

Despite their promises, few Democrats followedthrough by supporting the Alliance program, eitherat the state or the federal level.

In May 1891, Western populists met with somelabor and reform groups in Cincinnati. The meetingendorsed the creation of a new national People’sParty to run candidates for president. Only a fewSoutherners attended the convention. By the follow-ing year, however, it had become obvious to manySouthern members of the Alliance that the Democratswere not going to keep their promises to the Alliance.By early 1892 many Southern farmers had reached thepoint where they were willing to break with theDemocratic Party and join the People’s Party.

A Populist for President In July 1892, the People’sParty held its first national convention in Omaha,Nebraska. There, members officially organized theirparty and nominated James B. Weaver to run forpresident. Weaver was a former Union Army Generalwho had run for president before as the candidate ofthe Greenback Party. The Omaha convention alsoendorsed a platform, or program, that spelled out theparty’s positions in strong terms. First of all, theOmaha platform denounced the government’srefusal to coin silver as a “vast conspiracy againstmankind.” To increase the money supply, it called fora return to unlimited coinage of silver at a ratio thatgave 16 ounces of silver the same value as 1 ounce ofgold. Other platform planks called for federal owner-ship of railroads and a graduated income tax, onethat taxed higher earnings more heavily.

Above all, the Populists wanted to strengthen thehand of government so that it could defend the pub-

lic against what they saw as greedyand irresponsible private interests.“We believe that the powers of gov-ernment—in other words, of thepeople—should be expanded,” theplatform stated, “as rapidly and as faras the good sense of an intelligentpeople and the teachings of experi-ence shall justify.”

Although the Populists alsoadopted proposals designed to appealto organized labor, workers found ithard to identify with the ruralPopulists. The Populists did haveclose ties to the Knights of Labor, butthat organization was in decline,while the fast-growing AmericanFederation of Labor steered clear of an alliance with them. The Omaha

i n H i s t o r y

Mary Ellen Lease1853–1933

Mary Ellen Lease, a former school-teacher and daughter of an Irish politi-cal refugee, earned a law degree whileraising four children on the Kansasfrontier. She was one of the most pas-sionate speakers for the People’s Partyin Kansas during the 1890 electioncampaign. Political opponents nick-named her “Mary Yellin” and criticizedthe tall and forceful Lease for acting inan “unfeminine” manner by speakingin public.

Lease’s bluntstyle, however,appealed toKansas farmers.“Wall Street ownsthe country,” shedeclared. “It is nolonger a government of thepeople, for the people, by the people,but a government of Wall Street, forWall Street, and by Wall Street.” Leaseurged farmers to spend less time rais-ing crops and more time campaigningagainst the banks and railroads.

504 CHAPTER 16 Politics and Reform

CHAPTER 16 Politics and Reform 505

platform took positions popular with labor, includ-ing calling for an eight-hour workday, restrictingimmigration, and denouncing strikebreaking, butmost urban workers still preferred to remain withinthe Democratic Party.

Democrats retained support in Northern cities bynominating the popular New Yorker, GroverCleveland, who was seeking to return to the WhiteHouse after his close defeat in 1888. The South alsoremained solidly Democratic, despite determinedefforts by Populists. When the votes were counted,Cleveland had won a resounding victory in theElectoral College, with 277 votes to 145 for Harrison.The Populist candidate, James Weaver, had doneremarkably well, winning four states and splittingtwo others for a total of 22 electoral votes.

The Panic of 1893 Not long after Cleveland’s inau-guration in 1893, the nation plunged into the worsteconomic crisis it had ever experienced. The panicbegan in March when the Philadelphia and ReadingRailroads declared bankruptcy. Many railroads hadexpanded too rapidly in the period before the panicand now found it hard to repay their loans. The stock

market on Wall Street crashed, and banks closed theirdoors. By 1894 the economy was deep in a depression.About 690,000 workers went on strike that year, andmore than 4.6 million more were unemployed,approximately 18 percent of the workforce.

Goldbugs and Silverites The Panic of 1893 also cre-ated a crisis for the United States Treasury. ManyAmerican and European investors owned U.S. govern-ment bonds, but as the economy worsened, they begancashing in their bonds for gold. This caused gold todrain out of the U.S. Treasury and left the federal gov-ernment’s gold reserves at a dangerously low level.

Although President Cleveland could not stop theflow of gold to redeem bonds, he could protect thegovernment’s reserves in another way. Gold wasalso being lost every time people exchanged silverfor gold under the Sherman Silver Purchase Act.Unlike many Democrats, Cleveland believed theUnited States should use gold as the basis for its cur-rency, not silver or paper money. In June 1893, hesummoned Congress into a special session andpushed through the repeal of the Sherman SilverPurchase Act.

MOMENTinHISTORYHARD LIFE ON THE PLAINSEnglish-born immigrant farmer

David Hilton and his family

proudly pose beside their

pump organ on their home-

stead in Nebraska.The organ,

their prized possession, had

been rescued from the Hiltons’

sod-built dugout after the roof

collapsed. Farm families on the

sparsely-settled, treeless plains

had to cope with isolation as

well as a variety of natural haz-

ards, including dust storms,

tornadoes, erratic rainfall, and

the occasional plague of

destructive insects that could

strip entire fields of crops in a

matter of hours.

MOMENTinHISTORY

Cleveland’s actions split the Democratic Party intotwo factions, nicknamed “goldbugs” and “sil-verites.” The goldbugs believed the American cur-rency should be based only on gold, while silveritesbelieved coining silver in unlimited quantities wouldsolve the nation’s economic crisis.

Summarizing What was the mainoutcome of the Populist campaign in the elections of 1892?

The Election of 1896As the election of 1896 approached, leaders of the

People’s Party decided to make the silver issue thefocus of their campaign. They also decided to holdtheir convention after the Republican andDemocratic conventions. They believed theRepublicans would endorse a gold standard, whichthey did. They also expected the Democrats to nomi-nate Cleveland again and hoped that when thePeople’s Party strongly endorsed silver, pro-silverDemocrats would abandon their party and vote forthe Populists in large numbers.

Unfortunately for the Populists, their political strat-egy failed. The Democrats did not waffle on the silverissue. Instead, they nominated William JenningsBryan, a strong supporter of silver. When thePopulists gathered in St. Louis for their own conven-tion, they faced a difficult choice: endorse Bryan andrisk undermining their identity as a separate party, ornominate their own candidate and risk splitting thesilver vote. They eventually decided to support Bryan.

Bryan’s Campaign William Jennings Bryan, a for-mer member of Congress from Nebraska, was only36 years old when the Democrats and Populists nom-inated him for president. Bryan had served inCongress for two terms as a representative fromNebraska. He was a powerful speaker, and he wonthe nomination by delivering an electrifying addressin defense of silver, one of the most famous inAmerican political history. He began by telling dele-gates that he had come to speak “in defense of acause as holy as the cause of liberty—the cause ofhumanity.” With a few well-chosen words, Bryantransformed the campaign for silver into a crusade:

“Having behind us the producing masses of this

nation and the world, supported by the commercial

interests, the laboring interests and the toilers every-

where, we will answer their demand for a gold stan-

dard by saying to them: You shall not press down

upon the brow of labor this crown of thorns; you

shall not crucify mankind upon a cross of gold.”—quoted in America in the Gilded Age

Bryan waged an unusually energetic campaign forthe presidency, traveling thousands of miles and mak-ing 600 speeches in 14 weeks. Some found his relent-less campaigning undignified, however, and hiscrusade in favor of silver alienated others. Catholicimmigrants and other city-dwellers cared little for thesilver issue. They did not like Bryan’s speaking styleeither. It reminded them of rural Protestant preachers,who were sometimes anti-Catholic.

Republicans knew that Bryan would be hard tobeat in the South and the West. To regain the WhiteHouse, they would have to sweep the Northeast and

Reading Check

506 CHAPTER 16 Politics and Reform

Campaigns in Contrast In 1896 Democrat William Jennings Bryan (left)ran an energetic campaign for president, traveling far and wide. RepublicanWilliam McKinley (right) campaigned from the front porch of his Canton,Ohio, home. How did their campaign styles work out?

History

CHAPTER 16 Politics and Reform 507

the Midwest. They thought that William McKinleyof Ohio, a former governor and member of Congress,was the candidate who could do it.

The Front Porch Campaign In sharp contrast tothe hectic travels of Bryan, McKinley stayed at hishome in Canton, Ohio. He conducted what the news-papers called his “Front-Porch Campaign” by meet-ing with various delegations that came to visit him.Meanwhile, across the Midwest and Northeast, theRepublican Party launched an intensive campaign onMcKinley’s behalf.

The Republicans campaigned against theDemocrats by blaming Cleveland’s administrationfor the depression and promising workers thatMcKinley would provide a “full dinner pail.” Thismeant a lot more to most urban workers than theissue of silver money. At the same time, most busi-ness leaders supported the Republicans, convincedthat unlimited silver coinage would ruin the country.They donated huge sums of money to the Republicancampaign. Many employers warned their workersthat if Bryan won, businesses would fail, unemploy-ment would rise, and wages would be cut.

McKinley’s reputation for moderation on laborissues and tolerance toward different ethnic groupshelped improve the Republican Party’s image withurban workers and immigrants. When the voteswere counted, McKinley had won a decisive victory.He captured 51 percent of the popular vote and hada winning margin of 95 electoral votes—hefty num-bers in an era of tight elections. As expected, Bryanwon the South and most of the West, but few of the

states he carried had largepopulations or deliveredmany electoral votes. Byembracing populism and itsrural base, Bryan and theDemocrats lost the Northernindustrial areas where voteswere concentrated.

Populism Declines Op-position to the gold-basedcurrency dwindled duringMcKinley’s time in office.The depression was over,and prospectors found goldin Canada in 1896 and in Alaska in 1898. That wealth,combined with new gold strikes in South Africa andother parts of the world, increased the money supplywithout turning to silver. This meant that credit waseasier to obtain and farmers were less distressed. In1900 the United States officially adopted a gold-based currency when Congress passed the GoldStandard Act.

When the silver crusade died out, the Populistslost their momentum. Their efforts to ease the eco-nomic hardships of farmers and to regulate big busi-ness had not worked. Some of the reforms theyfavored, however, came about in the next century,including the graduated income tax and some gov-ernmental regulation of the economy.

Evaluating What were the results ofthe 1896 presidential election?

Reading Check

Writing About History

Checking for Understanding

1. Define: populism, greenback, inflation,deflation, cooperative, graduatedincome tax, goldbug, silverite.

2. Identify: Grange, People’s Party,William Jennings Bryan.

3. List the issues that the Democratsendorsed in the 1896 presidentialelection.

Reviewing Themes

4. Economic Factors What economicproblems caused farmers to supportpopulism?

Critical Thinking

5. Analyzing How did the Farmers’Alliance contribute to the rise of a newpolitical party?

6. Organizing Use a graphic organizersimilar to the one below to list the fac-tors that contributed to the Panic of1893 and its effects on the nation.

Analyzing Visuals

7. Analyzing Photographs Examine thephotograph of David Hilton and his familyon page 505, showing them with anorgan they rescued from a collapsed sodhouse. Why do you think it was so impor-tant for them to rescue the organ?

8. Persuasive Writing Imagine you sup-port the Populist Party and that you havebeen asked to write copy to be used in acampaign poster for your party’s candi-dates. Include a slogan that provides rea-sons for people to support the Populists.

FactorsContributing to

Panicof 1893

Effects onNat ion

Student WebActivity Visit theAmerican Vision Website at tav.glencoe.comand click on StudentWeb Activities—Chapter 16 for anactivity on politicalchanges in the late1800s.

HISTORY