How Henry Ford’s Invention Inadvertently Caused the Depression

In early 20th century America the vast majority ofWe have a seemingly similar situation occurring today.
people living in rural areas eked out a living inWe constantly read headlines about the dying
agriculture. Farms were small, often sharecropped.manufacturing sector in the United States. Politicians
The planting and harvesting was labor intensive andlove to visit deserted factories and decry the decline
horses provided the only source of energy forof manufacturing in a wide range of formerly
mechanized tilling. The vagaries of weather andprofitable industries. And yet, manufacturing in
drought have always made farming difficult. CropsAmerica is setting records for volumes produced,
were mainly grown for consumption by theshipped and invoiced. How can this dichotomy exist?
farmer’s family, with any extra produce barteredAs with the Fordson tractors 1920’s introduction
for needed goods.to farmers, today’s manufacturing has evolved
We are all aware of the history of Henry Ford anddramatically and created disruptive technologies.
his invention of the production line to mass-produceRobots, software, customized computer models,
Model-T’s. Ford did not invent the automobile, hecomputer assisted design and modern
simply invented a method to produce cars in masscommunications mean that we produce ever more
volumes and make them available for virtually anyonesophisticated products, in greater volumes, and at
wishing to purchase a horse-less carriage. He alsolower prices, while needing fewer workers per unit of
revolutionized the agriculture business with totallyproduction. The workers that are needed today
unforeseen consequences.require better education, and skills than the
The Ford Motor Company was always seeking newproduction line workers of yore. 
avenues of distribution and business opportunities.When I was growing up in an industrial area of
Ford had grown up in then-rural Michigan and wasAmerica in the 1960’s many of my
immersed in the farm world of the age. In thecontemporaries went to work with their fathers at
1920’s Ford introduced the first mass-producedthe local mill or factory. These were overwhelmingly
farm tractor, the Fordson. The machine sold forunion jobs. Each of my buddies at that time thought
under $400 and revolutionized farming. It quicklythey would be employed for life like their fathers had
became cheaper and less costly to own and maintainbeen. It has worked out that none are where they
a Fordson tractor than a horse.started, not one.
Farmers quickly gravitated to the Fordson tractor.The displacement is as painful today as it was on the
Crop yield per acre expanded exponentially. Farmersfarm of the 1920’s. However, the benefits to
produced so much crop yield per acre that by thesociety accruing from modern manufacturing
middle of the 1920’s we were growing far moretechnologies and systems, just like the advances in
food than the country could consume. Pricesfarming owing to mechanization, cannot be denied.
plummeted. The need for day laborers declinedOnly the Luddites of the 19th century and there
precipitously and rural unemployment exploded.modern adherents believe life is not more
The collapse of crop prices, unemployment, and thecomfortable today and more people have more
Great Plains drought were significant contributors toaccess to more goods and services at lower prices
the start of the Great Depression. The Fordson wasthat at any time in history.
an amazing improvement in the productivity andChange is hard and often inconvenient. We live during
ability of farmers to lead more comfortable lifestyles.an age of massive change unlike any time in history.
However, the “Law of UnintendedThe understanding of and acceptance of modern
Consequences” reared its ugly head in thisrealities insure that most people will benefit from
instance. The creative disruption caused by thisadvances in technology. Those that do not want to
product was thrust on a market that could notchange and accept the new order of things will be
adjust efficiently or quickly to its significance.left behind.