By Thomas F. Schwartz
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Most history buffs know that Herbert Hoover was born on August 10, 1874. What is less well-known is that the summer of 1874 witnessed a major devastation of crops in Canada and the Unites States by locust swarms including areas of Western Iowa. Over two million square miles of area were affected destroying millions of dollars of agricultural crops. Locusts swarms have been prominent throughout history whether as one of the ten plagues of Egypt described in the Bible, Laura Ingalls Wilder’s On the Banks of Plum Creek, or the more recent swarm in China during the summer of 1961 obscuring the sun. While few think of locusts as a contributing factor in the Great Depression, a new book by Tyler Goodspeed, Recession: The Real Reasons Economies Shrink and What to Do About It, makes an important correction to our understanding of the drought of 1930-31.
Most discussions of the Great Depression mention the drought of 1930-31 as impacting farm economies in the affected regions. But the drought conditions also produced an ideal environment for locusts to thrive. This feature adds a significant element to the economic distress befalling farmers. According to Goodspeed:
To put the scourge in physical perspective, a grasshopper swarm the size of Manhattan can in one day consume as much food as forty-two million people. With a Springfield, Missouri newspaper reporting in 1931 on a ravenous swarm spanning more the 46,876 square miles—an area over double the size of Manhattan—this implies that just one swarm in the summer of 1931 was consuming the equivalent of nearly ninety million people each day.
Naturally, economic and financial reports from affected Federal Reserve districts regularly covered the unfolding disaster in 1931. Though accounting for only about a fifth of deposits in suspended banks in the latter half of 1931, the sheer number of bank failures in states severely afflicted by the 1931 drought cum locust plagues was unique. With less than a third of all US banks in June 1931, worst affected states accounted for more than two in five US bank failures in the second half of 1931. The proportion is even higher if one includes additional states such as Arkansas, that may have been spared the locust plague but nonetheless endured the two-year drought.