Follow the Yellow Brick Road

ED: We’re going to return now to the populists at the end of the 19th century. And we thought we’d take a moment to explain why their signature issue was, of all things, monetary policy, especially the place of silver in the economy. Now, this is hard to explain, so we’re fortunate that back in the 1960s, a teacher named Henry Littlefield had a brilliant idea. He would use the Wizard of Oz, the novel, to explain populism to his glassy-eyed summer school students.

Littlefield saw all kinds of connections between Oz and the populists. Now, to be honest, it’s not clear that L Frank Baum actually meant his children’s book to be a populist parable, but that’s beside the point. As BackStory producer Kelly Jones found out, the Wizard of Oz is still a helpful tool to explain the ins and outs of populist economics.

RANJIT DIGHE: Once you start looking for parallels, it just becomes a matter of seek and you shall find.

KELLY JONES: This is Ranjiy Dighe, an economic historian at SUNY Oswego who wrote a book comparing populism and The Wizard of Oz. Parallels between the two begin on the very first page of the novel in bleak and dismal Kansas.

FEMALE SPEAKER: When Dorothy stood in the doorway and looked around, she could see nothing but the great grey prairie on every side.

KELLY JONES: This was the scene in the late 1800s. The US has experienced three economic depressions in quick succession, and western farmers suffered the most.

FEMALE SPEAKER: The sun had baked the plowed land into a gray mass with little cracks running through it.

KELLY JONES: Drought and pests destroyed farmer’s crops. What they could produce wasn’t very valuable, because overproduction in the east brought prices down nationwide. To top it off, farmers were deeply in debt. They took out loans to buy land and equipment when times were good, and at fixed rates. But when the prices fell, the national interest rate plummeted. Farmers’ rates didn’t change, though, so their debts soared.

RANJIT DIGHE: They’re paying back those loans in dollars that are worth a lot more than the ones that they borrowed and spent already.

KELLY JONES: Long economic story short, depression and deflation tore through the nation like– well, a twister.

Farmers and other members of the emerging populist movement thought that if they could just reverse the deflation, the economy would recover.

RANJIT DIGHE: If money were showered above from a helicopter, people would scoop up all that money and they would try to spend it, and that would raise the price of just about everything. That would bring you an inflation.

KELLY JONES: One 19th-century version of a money-showering helicopter was what populists called the free coinage of silver.

RANJIT DIGHE: Yeah, let’s talk about silver.

KELLY JONES: In the 1880s 1890s, the basic unit of currency was gold– an ounce of gold, actually, or an oz of gold, abbreviated, if you will. Anyway, the country was on the gold standard. But gold was scarce. Populists figured a second monetary standard backed by a more plentiful raw material would expand the money supply. So they called on the government to start coining silver as well as gold, which leads us to the next big parallel between Oz and the populist movement– the magic of bimetallism.

RANJIT DIGHE: Dorothy gets these silver shoes from the Wicked Witch of the East.

KELLY JONES: That’s right– silver shoes. No ruby slippers here. Those only appear in the movie.

Dorothy, who represents the average American, has to walk to the political seat of Oz via that yellow brick road. That’s the only way she can get back to Kansas– or end deflation.

So silver shoes on a yellow gold road. That’s bimetallism. That’s having gold and silver together. And they’re more powerful together than they would be individually as a monetary standard.

KELLY JONES: But bimetallism had its critics, embodied by one of the wicked witches.

RANJIT DIGHE: The Wicked Witch of the East represents Wall Street and these evil, soulless corporate interests who the farmers definitely thought of as their enemy.

KELLY JONES: That’s because Wall Street rejected bimetallism as a reckless solution that would make prices spike uncontrollably. In the story, western farmers take the shape of the scarecrow duped into thinking he doesn’t have a brain.

[MUSIC PLAYING]

The Tin Man stands for industrial workers who faced an almost 25% unemployment rate in the early 1890s. And then there’s the lion who, coincidentally, rhymes with William Jennings Bryan.

RANJIT DIGHE: The politician who ran for president three times, most notably in 1896 on a platform of free coinage of silver, and really became identified with that movement.

KELLY JONES: Bryan was a Democrat, not a populist. But the populists nominated him for president because he was an ardent silverite.

RANJIT DIGHE: So lions are known for their roar. Bryan was known for his oratory. He gave a speech at the Democratic Convention in 1896, which is known as the Cross of Gold speech.

WILLIAM JENNINGS BRYAN: We will fight them to the uttermost.

RANJIT DIGHE: He mostly talked about how the gold standard was crippling this economy, and he famously concluded you shall not crucify mankind on a cross of gold.

KELLY JONES: Today, one way the government fights deflation is by printing more money. But that was a radical idea in the 1890s– too radical for populists. They were deeply suspicious of fiat money, or currency that isn’t tied to something physical, like precious metals.

So back in Oz and marching together under the banner of bimetallism, Dorothy and her crew set off for the Emerald City– which, int he book, isn’t actually emerald. The wizard forces everyone to wear green sunglasses, which give the all-white city a green tinge.

RANJIT DIGHE: If you take off the glasses, then suddenly it’s no longer emerald, just like our fiat money of the 19th century. If everybody decides, these are pieces of paper, these don’t represent real value, then suddenly, our monetary system breaks down.

KELLY JONES: In the end, a bimetallic heroine kills the Wicked Witch of the West, who stands for the draught, with a bucket of water, thus bringing the crops back to life. The wizard takes off, leaving Oz in the hands of Dorothy’s capable companions.

RANJIT DIGHE: And it’s a happy ending. We don’t see exactly how they do ruling the Land of Oz, but you’re left to expect that it’s going to be good.

KELLY JONES: Except that’s the Hollywood ending. The book and the movement didn’t turn out so well. Deflation finally ended after the 1896 election with huge discoveries of gold in Alaska and the Yukon.

RANJIT DIGHE: So the free silver issue pretty much disappears with the discovery of all this gold, and it’s barely heard from again.

KELLY JONES: In the book, as Dorothy flies home to Kansas, her silver shoes slip off her feet and are lost forever in the desert. After losing the presidency to Republican William McKinley, William Jennings Bryan toned down his passion for silver.

RANJIT DIGHE: If Bryan runs in 1900, it’s not a very compelling issue. He still talks about it, but it doesn’t get a lot of traction.

KELLY JONES: Lost his roar. Sorry.

RANJIT DIGHE: Or he had to roar about something else. He was still roaring, but I don’t know how many people were listening.

[MUSIC PLAYING]

ED: BackStory producer Kelly Jones brought us that story. She had help from Ranjit Dighe, a Professor of Economic History at the State University of New York Oswego and the author of The Historian’s Wizard of Oz: Reading L Frank Baum’s Classic as a Political and Monetary Allegory.