Lecture #15: Farms and Markets

Suggestions for Further Reading:

Paul Wallace Gates, History of Public Land Law Development (1968). Despite its uninviting title, this is the great narrative overview of the history of the public lands of the United States through 1968, an extraordinary act of synthesis summarizing more than half a century's worth of scholarship. It's available as a PDF download from Hathitrust:
https://babel.hathitrust.org/cgi/pt?id=uc1.32106000891595;view=1up;seq=3

By the way, one of the section titles below alludes to a classic article by Paul Wallace Gates entitled "The Homestead Law in an Incongruous Land System," American Historical Review (July 1936), 652-81.

William Cronon, Nature's Metropolis: Chicago and the Great West (1991).

Walter Prescott Webb, The Great Plains (1931). Classic history of Euroamerican settlement on the Great Plains and the agricultural challenges associated with arid western lands.

Lloyd Lewis & Stanley Pargellis, Granger Country: A Pictorial Social History of The Burlington Railroad (1949).

Richard and Maisie Conrat, The American Farm: A Photographic History (1977).

John Ise, Sod and Stubble: The Story of a Kansas Homestead (1936). A classic autobiographical account (based on the experiences of the author's mother) of homesteading by German immigrants on the Great Plains.

Caroline Fraser, Prairie Fires: The American Dreams of Laura Ingalls Wilder (2017). Prize-winning biography of the author whose Little House on the Prairie books profoundly influenced perceptions of homesteading in the American imagination.

 

I. Toward Homestead

We talked last time about land sales as a vital source of revenue for the federal government during the 19th century, and also about the ways in which access to land was central to the Jeffersonian republican vision of an "Empire of Liberty." We noted that there were conflicts over who should be able to buy such land; how easy it should be to buy such land; and how much it should cost. This helps explain why, in the decades immediately following the American Revolution, large companies of land speculators played such active roles in shaping Virginia politics and the politics of other states with claims to western lands (along with states like Maryland that lacked such claims).

The following graph offers a useful timeline not only for tracking the volume of public land sales in the 19th and early 20th centuries, but also for major land laws that changed public access to those land sales. You may want to refer to it as you read the notes below.

Erwin Raisz's Landform Outline Map of the United States, 1954, National Atlas Version, 1970Original Land Entries, 1800-1943, USDA Bureau of Agricultural Economics,
reprinted in Paul Wallace Gates, History of Public Land Law Development, 1968, p 496

We can make several broad generalizations about the ways in which the management and sale of the federal public domain changed over the course of the nineteenth century:

  • Over time, an increasing number of land sales took place in the West rather than the East. At least in theory, this could benefit purchases by would-be landowners of lesser means who resided in the West, since the long journey to participate in eastern land auctions was beyond the means of many such would-be buyers.
  • Over time, there was a tendency for the government's asking price per acre to drop, along with the minimum unit size of land sales. Initially, some sales were either for an entire square mile (640 acres) or even for 36 square miles (an entire township) at a time; by mid-century, land could be purchased in units as small as 160 acres. This too meant that would-be buyers of smaller means could acquire land with smaller amounts of capital (and smaller amounts of debt).
  • Most important, there was growing political agitation—which we can associate with the populist politics of Andrew Jackson and the Democratic Party during the 1830s and 1840s—for policies that would enable poorer people to buy land. A key expression of this movement was the 1841 Preemption Act, which allowed "squatters" (who occupied land without owning it) to make secure claims to the lands they occupied before that land was put up for auction, preventing their claims from being sold out from under them even though they hadn't yet completed their purchase. Squatters were then given up to five years to "improve" their claims, hoping to use profits from their improvements to complete their purchase. "Preemption" was thus symbolized the liberalization of land laws to help poorer individuals gain purchase land they would not otherwise have been able to afford.
    https://en.wikipedia.org/wiki/Preemption_Act_of_1841

Across the middle of the 19th century, in the continued battle for free homesteads, access to public land was blocked by eastern industrial interests worried about the potential effects of free homesteads on wages, and southern states worried that westward expansion in the North, and the new states that would come into being as a result, might yield growing anti-slavery majorities in Congress. The outbreak of the Civil War finally freed northern representatives in Congress to act. With the loss of Southern senators to Confederate secession, a Senate majority controlled by northern Republicans was free to pass much more liberal land laws.

On 27 May 1862, President Lincoln signed the Homestead Act into law--one of the best-known land laws in American History, and the first of a number of laws encouraging "homesteading" in the western United States.
https://en.wikipedia.org/wiki/Homestead_Acts
The act specificed that any adult male citizen or intended citizen could obtain a quarter section of land (160 acres, one quarter of a square mile) by registering, improving, and living on that claim for 5 years. If quicker purchase was required, that individual could buy it for $1.25/acre at end of six months. Remember, though, that the Homestead Act didn't mean that the land was actually free—would-be homesteaders still needed quite a large amount of capital to buy the farming equipment, seeds, livestock, etc., to improve the land and operate a farm. Many went into serious debt and even bankruptcy because they lacked sufficient funds to farm "free" land profitably.

On 1 Jan 1863, the first application for a plot of land under the 1862 Homestead Act was made, in southeastern Nebraska, by Daniel Freeman. The name of the applicant was, indeed, too good to be true – the event was actually a publicity stunt, for which Freeman had been furloughed from the Union Army because his last name seemed so perfect as a symbol of the new law. A special land office was set up and then immediately shut down, an example of the symbolic politics at work. The agency responsible for these sales (and hence for a sizable fraction of federal government revenue in the 19th century) was the General Land Office (GLO), precursor of the modern Bureau of Land Management:
https://en.wikipedia.org/wiki/General_Land_Office
https://en.wikipedia.org/wiki/Bureau_of_Land_Management

The Freeman Homestead—which you can visit as a National Monument of America today—was a classic example of land of the eastern plains: tallgrass prairie, wooded streamcourse, rich soil. It seemed perfect land for farming, and so the publicity of Freeman's claim began the largest land rush in US history over the next half century. Land offices became centers for settlers and speculators alike. Long queues formed once families had found tracts on which they intended to settle or in which they intended to invest. A hastily prepared land office became a common sight in many western towns.
https://en.wikipedia.org/wiki/Homestead_National_Monument_of_America
https://www.nps.gov/home/index.htm

 

II. An Incongruous Land System in the Arid West

By no means were all of those filing claims at land offices doing so under the Homestead Act. A variety of federal laws created numerous mechanisms whereby public land could be sold and developed. For instance:

  • From 1847-1855, military bounty acts gave 36 million acres free land in warrants to veterans of the Mexican War and other wars. Most soldiers sold their land scrip, at substantial discount, and those speculative companies who bought this scrip could thus obtain land at much below the $1.25/acre standard.
  • Similarly, the 1862 Morrill Act gave federal land to each state to set up universities devoted to agriculture and engineering. Eastern states with no public land were given scrip, which they promptly dumped on market, at large discounts, also aiding speculators in amassing huge amounts of land. The University of Wisconsin-Madison has agricultural and engineering colleges because of the Morrill Act.
    https://en.wikipedia.org/wiki/Morrill_Land-Grant_Acts
  • Transcontinental Railroads: Another way you could acquire land would have been to buy it from the railroad. As we've already seen with the Union Pacific and Central Pacific, Congress gave enormous land grants to several transcontinental railroads on the theory that by selling alternating sections of land along its line, the railroad could use the proceeds from those sales to finance its own construction. Meanwhile, the government wouldn't lose any money, because it would sell sections of land along the railroad corridor at double the asking price elsewhere. In the end, all of the land-grant railroads went bankrupt, since their managers made more money on construction (and shady financial dealings) than on actual operation of the railroad.
  • Thus, not all of those who took advantage of public land sales were settlers. Even laws passed for the specific benefit of settlers often did not succeed in their goals. One law that did benefit settlers, but for the wrong reasons, was the 1873 Timber Culture Act, which offered an additional 160 acres to any settler who planted 40 acres in trees. The decade of the 1870’s saw growing realization that agricultural practices east of the Mississippi River might not be appropriate in the more arid West. Many believed that trees promoted rainfall – so planting trees might make dry western land more fertile. The effect of the law was to allow larger farm units than had been seen previously, and a total of 10 million acres were transferred under this law. Larger units were very likely necessary on the dry plains.
  • On other hand, the Desert Land Act of 1877 gave 640 acres to anyone who made efforts to irrigate arid western land. Ostensibly meant to benefit farmers, the law was actually lobbied for by cattlemen and speculators who, under the law, would pay $1.25 cents per acre in return for a promise to irrigate the land within 3 years. Cattlemen could acquire their ranges by dumping bucketfuls of water into furrows from time to time, swearing that the land had been irrigated.

The frenzy to acquire land produced some absurd (and patently corrupt) practices: the building of temporary shacks for claim staking, or even a house on wheels to move between plots; toy houses measuring "twelve by fourteen" that were actually 12 inches by 14 inches rather than 12 feet by 14 feet; the sending of a son into the land office where he would stand on the number 21 and swear he was over 21, and so able to make a land claim for himself. The point in all of this was that land law was easily subverted, with land agents themselves often fully complicit. All these corrupt practices were winked at by western settlers and land offices.

Part of the reason to amass a large landholdings via speculation was for profit; but another reason was the changed scale demanded by farming practices suited to arid western environments. 160 acres had seemed like the optimal size for a modest farm in the humid eastern part of the country. Past the line of 20” rainfall (the notorious "hundredth meridian") however, this changed: either much larger land units with thousands of acres were necessary for grazing, or much smaller units of 40-80 acres were needed for intensive irrigation, as the Mormons had demonstrated in Utah.

By the last quarter of the nineteenth century, the system of land sales that had characterized much of the nineteenth century in the eastern U.S. seemed to make less and less sense in the arid West. Among the first to realize this was John Wesley Powell, who we've encountered before. In 1879, Powell published one of most prescient studies of the American West ever written, with the unlikely title A Report on the Lands of the Arid Region of the United States.
https://en.wikipedia.org/wiki/Report_on_the_Lands_of_the_Arid_Region_of_the_United_States
https://pubs.usgs.gov/unnumbered/70039240/report.pdf
In this important document, Powell argued that the US should abandon the grid system of the 1785 Ordinance and the earlier system of land sales it had put in place. Instead, the federal government should begin to allocate public lands functionally, according to their most appropriate use given the environmental constraints that scientific surveys were beginning to demonstrate in the U.S. West. He argued that western lands should be evaluated ecologically as well as socially: dry grazing lands should be managed under one set of public policies, and irrigable lands should be managed under quite a different set of public policies. In Powell's proposal, on dry grasslands, 9 or more individuals would be given homestead plots of 2560 acres (4 sq miles) for grazing. Conversely, in irrigable areas along watercourses, 9 or more individuals should be given homestead plots of 80 acres each and organized into an irrigation district to manage water use as a group endeavor.

Notice the emphasis on collective activity in Powell's report. This was because Powell had a concrete model in mind: Mormon settlement in Utah, which seemed to him the wave of the future. The Mormon Church had constructed and managed an elaborate system of irrigation canals when it settled Utah in the 1840s and 1850s, enabling Mormon communities to thrive in desert landscapes where agriculture might otherwise have seemed impossible. But the collective organization which seemed essential to Powell seemed too socialistic in Congress. The recommendations in Powell's prescient report were never put into effect—until the 1930s, when the Taylor Grazing Act essentially ended homesteading and the federal government began to play a much more active role in managing western lands.

The net effect of all these land laws was to turn millions of acres of public land into private property. Land sales waxed and waned in a series of booms and busts that followed the business cycle, but hundreds of millions of acres were transformed over the course of the nineteenth century, shaping the western landscape we experience today:

  • From 1607-1870, 407 million acres occupied, 189 million improved.
  • From 1870-1900, 430 million acres occupied, 225 million acres improved.

Euroamerican settlement was a flood tide. The most telling image is that of a land rush, the series of openings of Indian lands in Oklahoma—what in the earlier part of the century had been described as permanent "Indian Territory"—between 1889-93. Railroads hurried to make connections between Kansas and Texas, and helped lobby for opening up the territory for sale. Indians who had been promised this land in perpetuity were once again forced to cede large chunks of it.

On April 22, 1889, 100,000 would-be settlers lined up on territory’s border. Held back by officials until guns sounded at noon, thousands rushed into Oklahoma at break-neck speeds. Within hours, 1,920,000 acres had been claimed. By nightfall on April 22, Oklahoma City had a population of 10,000 and a few days later looked like a bustling large town. Lumber from Chicago and Lake Michigan forests as well as Arkansas yellow pine created this instant city on the Plains.

The land rushes can serve as symbols of the astonishing land hunger, faith in economic growth, and rising prices of real estate. To observe the large-scale impacts of this vivid tale, peruse the series of maps on "Public Lands of the United States" in Charles O. Paulin's Atlas of the Historical Geography of the United States. To view the maps I showed during lecture, visit the URLs linked below and click the "Next >" arrow in the upper right-hand corner to view the serial transformation of the American landscape:

In these maps, we begin to see the regionalization of agricultural production in the U.S.: not all areas are producing the same crops at the same time.

 

III. Selling Real Estate, Boosting Settlement

Now let's zoom in a little and ask: what was it like to purchase a plot of land? What was it like to set up a farm? What was it like to work that land, to try to earn a profit, to try to make a home?

Many institutions were involved in promoting settlement:

  • A real estate agent was the private equivalent of a land office – speculators who had amassed the best lands at low prices, then sold those lands to settlers at much higher prices. Agents and speculators hoping to make bigger profits often tried to project townsites, since the value of lots in towns was much higher than rural farmlands. The only way to make sure a townsite would succeed was to make sure it got a railroad depot: so the politics of townsite development relative to railroad routes is a bit part of the story. You'll see an especially dramatic example of this in the case of Chicago when you read Nature's Metropolis.
  • Frontier newspapers often had subscribers living back east and trying to decide whether to invest in land in the towns where those newspapers were based. So newspaper editors and printers played key roles in boosting new areas by encouraging settlement and investment through newspapers. Many early newspapers sold more subscriptions back East than in their local area. They also published guides for emigrants, promotional pamphlets, and other such examples of booster literature.
  • Local boosters weren’t the only ones promoting settlement. Probably most important of all were the land grant railroads, which had a powerful vested interest in trying to profit from their enormous land grants. They set up elaborate advertising programs to sell their holdings at as much $4 to $6 per acre, to arrange credit terms, and to offer free transport of settlers' goods. For our purposes, the railroads organized the migration, publishing guidebooks and telling would-be migrants where to buy land. Railroad companies even ran advertisements in England and all over northwestern Europe, spending millions to encourage immigration that they coordinated with eastern steamship companies.

In this way, thousands of European peasants came to set up farms in the U.S. West: Russians, Canadians, Irish, English, Germans, Norwegians, Swedes, Danes. We can see the impact of this migration in a variety of ways. In the eastern parts of Dakota Territory, travellers could more easily find someone who spoke Norwegian than English. 400 towns in Minnesota had Swedish names by 1890. States on the northern Plains and the Canadian Prairie provinces eventually set up immigration boards to encourage this European settlement.

 

IV. Local Landscapes of the Farm: Women’s Work, Men’s Work

The settlement of the West was not just done by immigrants — many Midwestern farm families in Ohio, Illinois, Wisconsin, Iowa, Missouri came as well. They pulled up stakes, packed all their essential belongings into wagons, and headed west to take advantage of the free land and imagined agricultural riches of the Plains.

Most who moved did so as families, who brought their skills and cultures to reproduce a Midwestern farm world in the transformed circumstances of the arid West. Men, women and children worked together to make the farm work, but lived to some extent in separate but intimately entangled worlds. Watching the creation of the farming frontier on the Plains is watching the worlds of men’s and women’s work being reproduced in a new landscape.

Settlers from the Midwest had been accustomed to having enough wood to build themselves classic pioneer log cabins. But the further west they moved onto the Plains, the less wood they could find and the more expensive it became to purchase...too expensive for families of little means. So pieces of sod were cut from the prairie and stacked like bricks to create dark, damp sod houses, the classic Plains homesteads.

Inside and around that dwelling was the world of women’s work. Among the ways the division of labor articulated itself in gendered terms, in a longstanding cultural construction, was that women's labor needed to be interruptable in case a child suddenly needed attentino. As a result, women did the gardening, cooking, and tending of small animals like chickens in the vicinity of the house. On the eastern Plains, where some firewood could be found, summer cooking could be done outside so that smoke wouldn’t fill house with choking odors. In winter, you just had to live with smoke from your fireplace until you could afford a stove. Women were also often responsible for cleaning, which was always challenging with dirt floors. Once a family could afford to buy lumber, plank floors made sweeping easier, and were eventually used to construct a frame house. So again: think of the microgeographies of male and female labor. Look at this interior geography and ask: what it's like to clean that space? Notice the size of the wood planks in some historic photographs — you can't find pine boards that wide today, because they were cut from mature pine forests that just don't exist in the Midwest anymore.

Salting meat, preserving fruit, churning butter: the labor of preserving the harvest so that food would still be nutritious in midwinter or early spring before new crops began to yield were crucial functions that (female) cooks performed on the farm. Women were also often in charge of textiles: the spinning wheel and sewing machine (which was widely adopted during the last three decades of the nineteenth century) were also part of this microgeography. Women were typically responsible for rendering soap, washing laundry, childbearing, childrearing, parenting, and sewing bedding. Think about the community represented in patchwork quilts. Teaching school, too, often fell to women.

Women’s work was crucial to subsistence: nurturing, shelter, but also part of a cash economy in a local sense because their work often contributed to a steady, regular income in small amounts (think, for instance, of collecting and selling eggs, or churning and selling butter). Income from these sources was often essential to families during the slow non-harvest season.

The domain of men's work was often farther out from the home, in the outside world: plowing, tending fields and crops, managing livestock (dangerous work that couldn't easily be done in the presence of very young children). Some of the earliest crops were corn, simply planted in holes dug into sod.

 

V. Farm-Making Innovations

This complex farm geography was undergoing a technological revolution during the same period that immigration was taking place.

A whole range of new techniques was necessary for settlement in the arid West, and these added to the farm-making costs associated with "free" land.

  • Grasshopper plows: This enabled farmers to cut through the thick prairie sod to plant wheat using a plow with a chilled iron or steel moldboard.
  • Barbed wire fences: The classic worm fence of the East saved labor but wasted wood that farmers on the Plains simply couldn’t spare. Plains farmers also had to defend their fields against open-range cattle. The solution, a barbed wire fence, was patented by Joseph Glidden of DeKalb, Illinois in 1874: the first practical machine-produced barbed wire.
    https://en.wikipedia.org/wiki/Barbed_wire
    This drastically reduced the amount of wood needed for fencing, but added the burden of purchasing a manufactured product. By 1883, the Glidden factory was producing 600 miles of fencing every 10 hours. By the end of century, Glidden was one of the wealthiest men in the United States
  • Windmills: Water was also a major concern. Anyone not near a dependable stream had to dig a well for themselves, which was backbreaking work. On the dry Plains, wells wouldn’t do – drawing water up from 100' or 120' underground was too much effort to be practical. And farms were not the only institutions needing water — cattle, ranchers, and railroads needed it too, and some kind of mechanical pump was needed. The obvious solution was a windmill, but eastern designs borrowed from Europe were too delicate and wood-dependent for conditions on the Plains. So a series of windmill companies sprang up on the eastern Plains.
    https://www.atlasobscura.com/articles/windmills-water-pumping-museum-indiana

Aridity nevertheless remained a serious problem, and by the 1870s farmers on the Plains were regularly experiencing serious droughts. Other environmental problems were also substantial: tornadoes (the first tornado ever photographed was in 1884); grasshoppers (at their worst in 1874 from Texas to the Dakotas, with grasshoppers described as being like a cloud blotting out sun); prairie fires.

Many farmers needed to turn to government relief to get though the worst. In spite of it all, farmers, men & women, stuck it out—though beware of stories of essential optimism that treat ecological problems as exceptional, when many of these farms had arguably pushed too far onto lands where basical environmental conditions couldn't support the kind of agriculture being conducted there. We still haven’t faced that lesson today.

 

VI. Leaving Traces

To get a sense of what all this looked and felt like, we have the great advantage during the second half of the nineteenth century of beginning to have very rich collections of early photographs available to us. In lecture, I showed a number of images by Solomon Butcher (1856-1927), an itinerant photographer in Nebraska who tried to make a living by traveling from farm to farm offering to take pictures for a fee. He left behind an extraordinary record, though he died thinking himself a failure.

Images shown in lecture included the following; you can sample Solomon Butcher's images at these links:
https://en.wikipedia.org/wiki/Solomon_Butcher
https://history.nebraska.gov/collections/solomon-d-butcher-collection
http://www.nebraskalife.com/The-Photographs-of-Solomon-Butcher/

Among my own favorite photos by Butcher is this one:
https://history.nebraska.gov/sites/history.nebraska.gov/files/collections-img/47fs.jpg
which has the following caption:

"Mrs. Hilton and her eldest daughter were adamant that they not be photographed in front of their sod house, because they wished to send copies of the picture to friends and relatives elsewhere and thought it embarrassing to be seen living in a house of dirt. But they did want to be seen with their new pump organ, so they made Mr. Hilton and the photographer drag the organ out of the house for the photographs, then drag it back in again."

Some homesteaders didn’t make it at all, abandoning their work to the bank that held their mortgage. The human drama of these peoples’ lives was bound up in complete set of transformations in economic institutions of American agriculture, linking them ever more closely to money markets and capitalist world economy in which they sought to sell their produce.

 

VII. The Coming of the Machine

What I want to do in the closing minutes of this lecture is narrate two processes for you: grain going to market, and what eventually happened to that grain during the second half of the nineteenth century with the emergence of large urban markets and manufacturing centers like Chicago and Minneapolis.

Here's a crucial theme to keep track of: the connection of production and consumption centered on major cities. Urban markets revolutionized capitalism and with it the American West. This is the argument you'll be encountering in the book Nature's Metropolis.

Farming until mid-century was largely conducted by hand, but inventors were steadily at work on various devices for mechanizing agricultural process. Massive increases in farm production, especially for cash grain crops like wheat, created new markets for farmer's products. Remember, technology is not an autonomous force – it operates within human institutions and is shaped by cultural values, as we’ll see.

We could look at mechanization in a whole range of farm processes, but some of the best known and most important changes transformed reaping – the harvesting of grain – so we’ll let it stand for the whole.

In 1831, Cyrus Hall McCormick of Virginia invented the first practical reaper, which he patented in 1834. McCormick found little market for his mechanized reaper until the late 1840s, when grain farming began to expand on the flat, stone-free prairies of the Midwest. In 1847, McCormick established a factory in Chicago which soon became the largest producer of reaping machines in world. The devices were mass produced and supplied farms throughout Midwest.

McCormick lost his patent renewal in 1848, so he embarked on a series of innovations in order to maintain an edge over his numerous competitors. The reaper of the late 1840s was hand raked, with a farmhand standing on a platform raking the cut grain onto the ground as it emerged from the machine. But as time passed, there were a series of innovations:

  • Self-raker: one obvious innovation was to create device that would do the raking by itself. Workers still had to go back through field and bundle grain stalks;
  • Marsh harvester of the 1860s: added a platform on which a farmhand could stand to perform binding;
  • Old Reliable Wire Binder: another obvious next step was to add device to do the binding by machine. Wire was initially used when self-binders were first developed in 1870s, but that was eventually replaced by twine in the 1880s and is still used. The result was enormous gains in labor efficiency. By the 1890s, it took 61 hours to harvest an acre of wheat by hand and 3 hours by machine.
  • Best’s Traction engine: the size of farms in California (partly because of the Spanish land grants there) meant that individual farms operated on much larger scales than were typical of homestead farms on the Great Plains. As a result, California planters could invest in larger and more expensive equipment like steam traction engines.
  • Combine Reaper-Threshers: Scale of western wheat farming made possible very large machines that not only reaped wheat, but threshed it at the same time, in a single pass. Now called "combines," they represented an epitome of mechanization by the late nineteenth century.

Remember, the mere invention of a machine is no guarantee that it will be practical. Geographic conditions, patterns of land ownership, market structure and demand, and the relative abundance of labor and capital, all shape decisions about the machines that do or do not get adopted, and how they're used.

 

VIII. Marketing Machines

An increasing reliance on machines like the reaper created a direct linkage between farmers and urban factories like McCormick’s in Chicago. Firms manufacturing those machines as a result began to experiment with new advertising and marketing techniques designed to encourage farmers to invest in their products.

As for farmers growing wheat: how were they to get their crops to market?

One answer was downstream, down the Mississippi. In water transit cities like those supplying St. Louis, bagged wheat was simply loaded onto flatboats, floated down to the Upper Mississippi, transferred to shallow-draft steamboats on the upper river, transferred again at St. Louis to deeper-draft steamboats on the lower Mississippi, and finally shipped downstream to New Orleans. There, it was sold in individual lots according to quality. Notice all the labor involved in all these transfers, in which sacks of grains were loaded on and off boats on human backs (at least some of them enslaved human backs).

Another answer that became increasingly available in the second half of the 19th century was ship grain to market on the railroad. Chicago had more routes for shipping goods back east than any other city in the Midwest, and had the lowest rates east of all the cities in the mid-continent because of competition among its different railroads, and the competition of all those railroads with water transportation on the Great Lakes during the warm months of the year.

The revolution that happened in Chicago, as described in the grain chapter of Nature's Metropolis, is that the grain came out of the sacks in which it traveled by boat, and began moving by rail instead. The railroad made possible entirely new grain-handling techniques that revolutionized marketing practices.

The grain elevator, first developed in Buffalo, NY, came into its own on a large scale in Chicago. By the early 1850s, Chicago was the greatest primary grain market in the world. No other city received half as much grain—which created a very real problem of how to handle so much grain. On the surface, there was nothing remarkable about those Chicago grain elevators of the 1850s – they were big buildings consisting of tall vertical bins, endless conveyors carrying grain from boats or freight cars to the top of the building, where the grain was separated into bins, and then delivered to ships or railroad cars by the force of gravity. Large grain elevators had a capacity of millions of bushels.

But think of what this meant. Up until now, grain had been sold in individual sacks and bought by lot. To make elevators work, grain from many farms had to be combined into a single bin. Farmers or shippers were given receipts for equal quantities of the grain they deposited in that bin – but not the same they had put in. In this, grain elevators began to operate similarly to the way you think of money you put into a bank. You don't expect to get the same money back when you cash a check; you expect to receive an equivalent value.

Grain varied in quality, so a grading system had to be developed to specify the uniform value of grain in a particular bin. The grading system that solved this challenge was created by the Chicago Board of Trade in 1857. The grading system meant that farmers and markets received receipts for a given quantity of a given quality of grain. By freeing grain from individual lots, it became a relatively homogeneous product, making it a much more easily traded as a commodity even by people who never saw or handled the actual physical grain.

In particular, people could now make contracts to buy or deliver grain at specified times in the future, even though they possessed no grain at the time they made this "futures contract", and could count on elevators to supply the necessary quantity on demand. By buying or selling when the price of grain lower or higher than the price on the original contract, grain traders could profit by speculating on the movement of future prices. Just so did the first true futures market emerge at the Chicago Board of Trade.

Chicago emerged during the middle decades of the nineteenth century as the largest grain market, meat market, and the lumber market in the entire world.

 

IX: Milling Flour in Minneapolis

Taking grain out of burlap sacks and putting it into massive grain elevators abstracted grain and allowed for the buying and selling of grain futures. So Chicago became a place that set world prices for wheat.

I'll give you a little tail to that story that doesn't appear as much in Nature's Metropolis. Here is a graph of wheat that passed through Chicago, and a separate graph line for wheat passing through Milwaukee—in the 1850s the largest wheat-milling city in the U.S.—and a separate line for the wheat passing through Duluth, Minnesota. Notice that in the 1880s, Duluth surpassed Chicago as the leading handler of wheat. What's that story?

The bankruptcy of the Northern Pacific Railroad during the Panic of 1873 opened up land in the Red River Valley in Minnesota for cheap sale, particularly for very large "bonanza farms." The size of these farms meant that landholders could invest in capital—agricultural technologies—that led to much expanded scales of farming, enormous wheat output, and changing agricultural practices. These included deep plowing (which would contribute to the Dust Bowl in the 1930s) and also new varieties of wheat.

These bonanza farms hit a problem: soft red winter wheat characteristic of the Eastern U.S. died during the very harsh winters of the northern Plains. So they began instead to cultivate hard red winter wheat, introduced from Central Europe. But hard red winter wheat could not be milled in the same way as the soft winter wheat, because earlier milling technologies with horizontal millstones became clogged, heated, and damaged flour because of the hard kernels of hard winter wheat.

In response, the water-powered mills at St. Anthony's Falls in Minnesota adopted a new technology: rotating ceramic drums instead of milling stones. By sending kernels of grain between a sequence of paired rollers, with ever narrowing distances between each new pair of rollers, they could avoid the heating problems of flat millstones and gain much greater control over the milling process.

This new rolling mill technology meant that flour mills could separate out parts of the wheat they didn't want. One part they discarded, for instance, was the wheat germ, which is nutritionally desirable but makes the wheat spoil more quickly because the oil in the germ goes rancid more quickly than the rest of the flour. Bran could also be removed in the same way.

So Minneapolis became the leading flour-milling center in the world by the 1870s. In the process, it introduced the world's first mass-produced pure white flour, an innovation that would forever change global nutrition. The Washburn family (of General Mills fortune) and the Pillsbury family were among those who led this transformation.