THE IMPACT OF WAR 101 



the struggle. According to one estimate, the actual number of farms and 

 farmers was reduced during these years by a million. 2 ' 



Probably the factor which contributed more than any other to the deep- 

 ness of this depression was the land boom that had accompanied the war 

 prices. It was natural for the farmer, with a high income for almost the 

 first time in his life, to pay off his debts, buy new machinery, improve 

 his property, acquire automobiles, victrolas, and other articles he had long 

 coveted. But it was a temptation, also, to buy more land, both as a means 

 of increasing his profits and as a means of acquiring greater wealth by 

 speculation. When new acquisitions, whether of land or of other prop- 

 erty, were paid for in full, the chance of catastrophe was not so great. 

 But when, as was so often the case, the purchases were financed in part 

 by mortgages or made on the installment plan, the purchaser was merely 

 gambling on the continuance of high prices. Some land transactions were 

 the sheerest speculation, with down payments comparable to the smallest 

 margins of stock market operations in 1929. According to an Iowa ob- 

 server, "Half of the people here are either land agents or speculators in 

 land. Most of the men have never been farmers, and never will be farmers. 

 The game is to buy and sell, and many are boasting of making thirty and 

 forty thousand dollars in a few months. And then they say the boom is 

 just started." 28 Nearly 95 per cent of the land buyers in Iowa paid down 

 in cash only 10 per cent or less, and nearly three-fourths of them paid only 

 5 per cent or less. The initial payment, however, was merely to bind the 

 sale, and approximately one-third of the purchase price was normally ex- 

 pected by the next March i, the date usually set for giving possession to 

 a farm. Some farmers who sold out retired to live on their fortunes; others 



27. Henry C. Wallace, "The Year in Agriculture," U. S. Dept. Agri., Yearboo/^, 

 1920, pp. 17-18; Archibald MacDonald Mclsaac, "Whither Agriculture?" in J. G. 

 Smith, ed., Facing the Facts: An Economic Diagnosis (New York, 1932), p. 290; 

 F. M. Surface, American Food in the World War and Reconstruction Period (Stan- 

 ford, Calif., 1931), p. 114; Warren S. Thompson and P. K. Whelpton, Population 

 Trends in the United States (New York, 1937), p. 19; Mowry, "Decline of Agricul- 

 ture," pp. 16-19. 



28. Wallaces' Farmer, XLIV (June 20, 1919), p. 1256. See also Archibald M. 

 Woodruff, Jr., Farm Mortgage Loans of Life Insurance Companies (New Haven, 

 Conn., 1937), pp. 19-23; E. R. A. Seligman, The Economics of Farm Relief (New 

 York, 1929), pp. 15-16. 



