1. Chapter 11 Section 2
Populism

2. Populism
A general definition: A political philosophy supporting the rights and power of the people in their struggle against the privileged elite.
A more specific definition: A political movement, primarily of farmers, in the late 1800s that demanded government aid for the common farmer and worker.

3. Organization is the Key to Change
In a Democracy, the “common” people supposedly have the power to use government to benefit their lives.
However, this often does not happen due to low participation, lack of education, and disorganization.
In the 1890s, Populists organized to increase the political power of farmers and to work for legislation for farmers’ interests

4. Rise of Populism https://www.youtube.com/watch?v=V6ueX6hqzNk
Populism emerged in the late 1800s because farmers were frustrated with:
high debt and low market prices
Being exploited by banks and railroads that were too powerful
Having a government they felt was not responsive to the needs of the people.

5. Unrest in Rural America
The nation’s money supply concerned farmers because most had to borrow money. A tight money supply meant higher interest rates and less available credit.
To help finance the Union in the Civil War, the government issued millions of dollars in greenbacks, or paper currency that could not be exchanged for gold or silver coins

7. This rapid increase in the money supply without a rapid increase in goods for sale caused inflation– a decline in the value of money
Therefore, prices of goods greatly increased
To get inflation under control, the federal government stopped printing greenbacks and also stopped making silver into coins

8. As a result, the country did not have a large enough money supply to meet the needs of the growing economy
This led to deflation–or an increase in the value of money and a decrease in the general level of prices
Deflation forced most farmers to borrow money to plant their crops, and the short supply of money caused an increase in interest rates on loans that the farmers owed.
Some farmers wanted more greenbacks printed; 0thers wanted the government to mint silver coins

9. The Grange
The Grange was a national farm organization founded for social and educational purposes
When the country experienced a recession, large numbers of farmers joined the Grange for help
The Grange changed its focus to respond to the plight of farmers

11. Grangers put their money together and created cooperatives–marketing organizations that worked to help its member
The cooperatives pooled members’ crops and held them off the market to force the prices to rise
Cooperatives could negotiate better shipping rates from railroads

12. The Grange was unable to improve the economic conditions of farmers
By the late 1870s, many farmers left the Grange and joined other organizations that offered to help them solve their problems

13. The Farmers’ Alliance The Farmers’ Alliance was formed in 1877
By 1890 it had between 1.5 and 3 million members with strength in the South and on the Great Plains
The Alliance organized large cooperatives called exchanges for the purpose of forcing farm prices up and making loans to farmers at low interest rates

14. These exchanges mostly failed
Many exchanges overextended themselves by loaning too much money at low interest rates that were not repaid
Wholesalers, manufacturers, railroads, and bankers discriminated against the exchanges
The exchanges were too small to dramatically affect world prices for farm products

15. Members of the Kansas Alliance formed the People’s Party, or Populists, to push for political reforms that would help farmers solve their problems
Most Southern leaders of the Alliance opposed the People’s Party because they wanted the Democrats to retain control of the South
The southern alliance came up with a subtreasury plan to set up warehouses where farmers could store their crops to force prices up

17. The Rise of Populism
In 1890 the Farmers’ Alliance issued the Ocala Demands to help farmers choose candidates in the elections
The demands included the adoption of the subtreasury plan, the free coinage of silver, an end to protective tariffs and national banks, tighter regulation of the railroads, and direct election of senators by voters
Many pro-Alliance Democrats were elected to office in the South

18. By early 1892, Southern members of the Alliance began to realize that Democrats were not going to keep their promises to the Alliance and they were ready to leave the Democratic Party and join the People’s Party
In July 1892, the People’s Party held its first national convention where it nominated James B. Weaver to run for president

19. The People’s Party platform called for unlimited coinage of silver, federal ownership of railroads, and a graduated income tax, one that taxes higher earnings more heavily
It also called for an eight-hour workday, restriction of immigration, and denounced the use of strikebreakers
Democrats nominated New Yorker Grover Cleveland for the 1892 presidential election
Cleveland won the election

20. Depression
The Panic of 1893 was caused by the bankruptcy of the Philadelphia and Reading Railroads
It resulted in the stock market crash and the closing of many banks
By 1894 the country was in a deep depression

21. Hoping to stabilize the economy, President Cleveland had Congress repeal the Sherman Silver Purchase Act and make gold the sole basis for the country’s currency
This caused the Democratic Party to split into the goldbugs and the silverites
Goldbugs believed U.S. currency should be based only on gold, while Silverites believed coining silver in unlimited amounts was the answer to the nation’s economic crisis

22. J. P. Morgan’s Loan
When Cleveland repealed the Sherman Silver Purchase Act there was little positive effect--by the following year there was only $41 million left in the Treasury.
The federal government was forced to look elsewhere for help. In a transaction that illustrates the great power and wealth of big business in the Gilded Age, President Cleveland borrowed more than $60 million from Wall Street financier J. P. Morgan to put the U.S. economy back on solid ground.

23. Coxey’s Army
The Depression and Cleveland’s insistence on the Gold Standard empowered the Populist movement-- disillusioned Democrats flocked to the Populist Party in the hopes of winning free silver and more power for the people.

24. Coxey’s Army
Economic conditions also encouraged the creation of reform movements. In 1894, wealthy Ohio businessman Jacob S. Coxey set out with 500 men for Washington, D.C. to petition the federal government for cheap money and debt-relief programs.
When “Coxey’s Army” reached the Capitol building, however, the men were arrested for trespassing on the lawn.

26. The Election of 1896
The Democrats nominated William Jennings Bryan for the presidential election of 1896
Bryan, a renowned speaker, strongly supported the unlimited coinage of silver
Populists also supported Bryan for president, so they didn’t run a candidate of their own.
The Republicans nominated William McKinley of Ohio for president
He promised workers a “full dinner pail”

28. McKinley Wins

29. McKinley won the election of 1896
Most business leaders liked McKinley because they thought that unlimited silver coinage would ruin the country’s economy
New gold strikes in Alaska and Canada’s Yukon Territory and in other parts of the world increased the money supply without needing to use silver
As the silver issue died out, so did the Populist Party