Down Pennsylvania Avenue, late that hot afternoon, came an impressive parade-four troops of cavalry, four companies of infantry, a machinegun squadron, and several tanks. As they approached the disputed area they were met with cheers from the veterans sitting on the curb and from the large crowd which had assembled. Then suddenly there was chaos: cavalrymen were riding into the crowd, infantrymen were throwing tear-gas bombs; women and children were being trampled and were choking from the gas; a crowd of 3,000-ormore spectators who had gathered in a vacant lot across the way were being pursued by the cavalry and were running widly, pell-mell across the uneven ground, screaming as they stumbled and fell.

The troops moved slowly on, scattering before them veterans and homegoing Government clerks alike. When they reached the other end of the Anacostia Bridge and met a crowd of spectators who booed them and were slow to "move on," they threw more gas bombs. They began burning the shacks of the Anacostia camp-a task which the veterans themselves helped them accomplish. That evening the Washington sky glowed with fire. Even after midnight the troops were still on their way with bayonets and tear-gas bombs, driving people ahead of them into the streets of Anacostia.

The "Bonus Expeditionary Force" had been dispersed, to merge itself with that greater army of homeless people who were drifting about the country in search of an ever-retreating fortune. The U.S. Army had completed its operation "successfully" without killing anybodythough the list of injured was long. The incident was over. But it had left a bitter taste in the mouth. Bayonets drawn in Washington to rout the dispossessed-was this the best that American statesmanship could offer hungry citizens?

The farmers were rebellious-and no wonder. For the gross income of American agriculture had declined from nearly $12 billion in 1929 when it had already for years been suffering from a decline in export sales-to only $514 billions in 1932. While most manufacturing businesses dropped their prices only a little and met slackened demand with slackened production, the farmer could not do this, and the prices he got went right down to the cellar. Men who found themselves utterly unable to meet their costs of production could not all be expected to be philosophical about it.

Angry Iowans, organized by Milo Reno into a Farmers' Holiday Association, were refusing to bring food into Sioux City for 30 days or "until the cost of production has been obtained"; they blockaded the highways with spiked telegraph poles and logs, stopped milk trucks and emptied the milk into roadside ditches. Said an elderly Iowa farmer with a white mustache to Mary Heaton Vorse, "They say blockading the highway's illegal. I says, "Seems to me there was a tea party in Boston that was illegal too." "

Elsewhere, farmers were taking the obvious direct means to stop the tidal wave of mortgage foreclosure sales. All through the prairie country there were quantities of farmers who not only had heavy mortgages on their property but had gone deeply into debt for the purchase of farm machinery or to meet the emergencies of years of falling prices; when their corn and wheat brought to even the most industrious of them not enough money to meet their obligations, they lost

patience with the laws of bankruptcy. If a man sees a neighbor of his, a formerly successful farmer, a substantial, hard-working citizen with a family, coming out of the office of the referee in bankruptcy stripped of everything but an old team of horses, a wagon, a few dogs and hogs, and a few sticks of furniture, he is likely to see red. Marching to the scene of the next foreclosure sale, these farmers would drive off prospective bidders, gather densely about the auctioneer, bid in horses at 25 cents apiece, cows at 10 cents, fat hogs at a nickel-and the next morning would return their purchases to the former owner. In a quiet county seat, handbills would appear: "Farmers and workers. Help protect your neighbors from being driven off their property. Now is the time to act. For the past 312 years we have waited for our masters, who are responsible for the situation, to find a way out. *** On Friday the property of is to be sold at a forced auction at the courthouse. *** The farmers' committeee has called a mass protest meeting to stop the above-mentioned sale." And on Friday the trucks would drive up to the courthouse and men by the hundreds, quiet, grim faced, would fill the corridors outside the sheriff's office while their leaders demanded that the sale be not held.

They threatened judges in bankruptcy cases; in one case a mob dragged a judge from his courtroom, beat him, hanged him by the neck till he fainted-and all because he was carrying out the law.

These farmers were not revolutionists. On the contrary, most of them were by habit conservative men. They were simply striking back in rage at the impersonal forces which had brought them to their present pass.

But it was during 1934 and 1935-the years when Roosevelt was pushing through his financial reforms, and Huey Long was a national portent, and the languishing NRA was put out of its misery by the Supreme Court that the thermometer in Kansas stayed week after week at 108 or above and the black storms raged again and again. The drought continued acute during much of 1936. Oklahoma farms became great dunes of shifting sand (so like seashore dunes, said one observer, that one almost expected to smell the salt). Housewives in the drought belt kept oiled cloths on the window sills and between the upper and lower sashes of the windows, and some of them tried to seal up every aperture in their houses with the gummed paper strips used in wrapping parcels, yet still the choking dust filtered in and lay in ripples on the kitchen floor, while outside it blew blindingly across a no man's land; roads and farm buildings and once green thickets half buried in the sand. It was in those days that a farmer, sitting at his window during a dust storm, remarked that he was counting the Kansas farms as they came by.

Retribution for the very human error of breaking the sod of the plains had come in full measure. And, as often happens, it was visited upon the innocent as well as upon the guilty-if indeed one could single out any individuals as guilty of so pervasive an error as social shortsightedness.

In

Westward fled the refugees from this new Sahara, as if obedient to the old American tradition that westward lies the land of promise. 1934 and 1935 Californians became aware of an increasing influx into

their State of families and groups of families of "Okies," traveling in ancient family jalopies; but for years the streams of humanity continued to run. They came along U.S. Highway 30 through the Idaho hills, along Highway 66 across New Mexico and Arizona, along the Old Spanish Trail through El Paso, along all the other westward trails. They came in decrepit, square-shouldered 1925 Dodges and 1927 La Salles; in battered 1923 model T Fords that looked like relics of some antique culture; in trucks piled high with mattresses and cooking utensils and children, with suitcases, jugs, and sacks strapped to the running boards. "They roll westward like a parade," wrote Richard L. Neuberger. "In a single hour from a grassy meadow near an Idaho road I counted 34 automobiles with the license plates of States between Chicago and the mountains."

They left behind them a half depopulated countryside. A survey of the farmhouses in seven counties of southeastern Colorado, made in 1936, showed 2,878 houses still occupied, 2,811 abandoned; and there were also, in that area, 1,522 abandoned homesites. The total number of drought refugees who took the westward trek over the mountains was variously estimated in 1939 at from 200,000 upward-with more coming all the time.

As these wanderers moved along the highways they became a part of a vast and confused migratory movement. When they camped by the wayside they might find themselves next to a family of evicted white Alabama sharecroppers who had been on the move for years, snatching seasonal farm labor jobs wherever they could through the Southwest; or next to tenant families from the Arkansas Delta who had been "tractored off" their land-expelled in order that the owner might consolidate two or three farms and operate them with tractors and day labor; or next to lone wanderers who had once held industrial jobs and had now for years been on relief or on the roadjumping freights, hitchhiking, panhandling, shunting back and forth across the countryside in the faint hope of a durable job. And when these varied streams of migrants reached the coast they found themselves in desperate competition for jobs with individuals or families who for years had been "fruit tramps," moving northward each year with the harvests from the Imperial Valley in southern California to the Sacramento Valley or even to the apple picking in the Yakima Valley in Washington.

Here in the land of promise, agriculture had long been partly industrialized. Huge farms were in the control of absentee owners or banks or corporations, and were accustomed to depend upon the labor of migratory "fruit tramps," who had formerly been mostly Mexicans, Japanese, and other foreigners, but now were increasingly Americans. Those laborers who were lucky enough to get jobs picking cotton or peas or fruit would be sheltered temporarily in camps consisting typically of frame cabins in rows, with a waterline between every two rows; they were very likely to find in their cabin no stove, no cots, no water pail. Even the best of the camps offered a way of life strikingly different from that of the ruggedly individualist farmer of the American tradition, who owned his farm or else was preparing, by working as a resident "hired man," or by renting a farm, for the chance of ultimate ownership. These pickers were homeless, voteless nomads, unwanted anywhere save at the harvest season.

When wave after wave of the new migrants reached California, the labor market became glutted, earnings were low, and jobs became so scarce that groups of poverty-stricken families would be found squatting in makeshift Hoovervilles or bunking miserably in their awkward old Fords by the roadside. Being Americans of native stock and accustomed to independence, they took the meager wages and the humiliation bitterly, sought to organize, talked of striking, sometimes struck. At every such threat, sometimes like panic seized the growers. If this new proletariat were permitted to organize, and were to strike at picking time, they might ruin the whole season's output of a perishable crop. There followed antipicketing ordinances; the spectacle of armed deputies dislodging the migrants from their pitiful camps; violence by bands of vigilantes, to whom these ragged families were not fellow citizens who had suffered in a great American disaster but dirty, ignorant, superstitious outlanders, failures at life, easy dupes for "Red" agitators. This engulfing tide of discontent must be kept moving.

Farther north the refugees were likely to be received with more sympathy, especially in regions where the farms were small and not industrialized; here and there one heard of instances of real hospitality, such as that of the Oregon town which held a canning festival for the benefit of the drought victims in the neighborhood. The wellmanaged camps set up by the Farm Security Administration were havens of human decency. But to the vast majority of the refugees the promised land proved to be a place of new and cruel tragedy.

[From the Quarterly Journal of Economics, August 1931]

INSTITUTIONAL FRICTIONS AND TECHNOLOGICAL UNEMPLOYMENT

(BY ALVIN H. HANSEN)

I. The argument that laborsaving improvements release purchasing power and so reabsorb displaced labor, 684.-The fallacy in this argument, 686.-Circumstance under which the displaced labor will be reabsorbed, 687.-II. Effect of price reduction, 688; of restrictions upon credit and wage rates, 690.-III. Effect of price maintenance, 692; of lower interest rates, 693.-IV. The effect of universal monopoly upon unemployment, 696.-Quasi-monopoly control of prices contrasted with rigid control of wage-rates, 697.

I

In a recent article of considerable length, Prof. Paul H. Douglas makes a detailed and thorough analysis of the view so generally held by labor leaders, employers, journalists, and politicians that technological improvements permanently displace labor, and that therefore the necessary solutions lie in the direction of shorter hours of work, more rigid elimination of juvenile labor and the pensioning of older workers. Mr. Douglas reaches the definite conclusion that this view is incorrect, that workers are not permanently thrown out of employment by improvements in machinery and in managerial efficiency. There is indeed nothing novel about this conclusion, but Mr. Douglas complains that writers, such as Sir William Beveridge in his "Unemployment, a Problem of Industry," fail to explain the forces at work and "consequently have not given any tangible justification for their faith that somehow the displaced workers will be reabsorbed elsewhere in industry." 1

The argument which Mr. Douglas advances, however, in support of his thesis is one long familiar to economic theorists. Laborsaving improvements reduce the cost per unit of output. The reduction in costs leads either to lower prices to consumers or to higher profits for employers. If prices are reduced in proportion to the lowering of costs, the quantity purchased will-in the case of commodities for which there is an elastic demand-increase so that no labor is displaced. In the case of inelastic demand, labor is indeed displaced, but the lower prices enable consumers to purchase the same quantities at much lower money expenditures; à part of consumers incomes is therefore set free and can be applied to the purchase of other commodities. Labor is required to produce these new commodities and so the displaced workers are reabsorbed into industry. If prices are not reduced, the lower costs yield larger profits to employers who in

Paul H. Douglas, "Technological Unemployment," American Federationist, August 1930. See also Douglas and Director, "The Problem of Unemployment, 1931."