1932-1933: The Worst of Times: State Faces Severe Crisis
Everywhere, North Dakota
News from all parts of the state is indeed grim. North Dakota has never seen such awful times. The bottom has fallen out of the wheat market; between 29 and 35 cents a bushelCbelow levels of the depressed 1890s! Drought has cut into yields in a terrible fashion. Wheat production has dropped to half of what it should be. Those farmers who have any crop at all report yields of only seven bushels per acre. In 1925 a farmer could have paid off a $10,000 loan with 6,000 bushels of wheat; today it takes about 35,000 bushels. Times are rough.
Nowhere is that more evident than in banking. North Dakotans have lost $50 million as banks closed; 575 of our 898 banks have been forced to shut their doors. Banking regulations have been lax and during the past decade banks have extended loans far in excess of their deposits. Generally, a safe loan rate is 60 percent of deposits (money on hand) but many have loaned up to 120 percent and one bank to 285 percent of its deposits. Most of these loans were made against farmland. When land values dropped and farm prices and crop production plummeted, farmers could not make payments on their loans. Banks then could not meet depositors’ demands; they had to close.
The depression has hurt most Americans, but none worse than North Dakotans. Stories of desperation are heard all over the state. In Cando merchants are accepting rabbit hides in exchange for goods. Bowman and Grant Counties have abandoned jury trials; there is no money to pay jurors. A Devils Lake farmer sold five head of cattle and reports that the profit was 76 cents a head. A Berwick farmer shipped five head of sheep to South St. Paul and waited for his check. Instead, he received a bill for $1.56 to cover expenses.
Some humor comes through the dark clouds. In Hope a man owed his friend $1.00 but only had 75 cents. He went to a pawn shop and pawned the 75 cents for 50 cents. He met a stranger on the street and sold him the 75-cent pawn ticket for 50 cents. He then was able to pay his $1.00 debt. In Edgeley, a couple could not afford to buy Christmas cards. Instead they purchased penny postcards and in red and green ink wrote on the cards:
Postage went up and wheat went down,
Collections are punk all over town;
The voters gave our salaries a slash
And, we Republicans took an awful crash.
We wondered how we’d send a greeting to you,
And finally decided a postcard would do.
But in a big way it’s full of cheer
For a Merry Christmas and a Happy New Year.
All North Dakotans hope for better times. They could not get much worse.
By Dr. D. Jerome Tweton
Originally published as The North Star Dakotan student newspaper, written by Dr. D. Jerome Tweton and supported by the North Dakota Humanities Council.