Real property, and particularly land, as a factor of production, is vastly more important for some enterprises than for others. While land constitutes a part of the capital equipment of all enterprises, it obviously plays a much more important role in agriculture. The remainder of the discussion is devoted to a brief survey of farm land ownership in the United States.

Mechanization of Farm Operations and the Increase in Tenancy.

The drastic change in the ownership pattern in American agriculture since the frontier period of settlement can be seen from the increase in tenancy in almost all farm areas, and the appearance of large quasi-industrial farm enterprises. In 1880 tenants operated 25.6 percent of all farms, while in 1910 the figure had risen to 37 percent, and in 1935 to 42 percent.60

In recent years the increase in the use of farm machinery has exercised a strong pressure toward expansion of farming operations, which has tended to increase the number of large landholdings at the expense of other farm owners and tenants. Furthermore, mechanization has tended to force displaced owners from the better lands to uneconomic subsistence agriculture in the poorer areas. Those who are dispossessed altogether have become a part of an agricultural proletariat which must seek employment in those areas where farming processes have not become completely mechanized."1

Displacement of farm families has taken place in the Corn Belt, as well as in the Cotton and Wheat Belts.

It has appeared in the Arkansas delta and the Missouri boot heel, in the onion fields of Hardin County, Ohio, where industrialized agriculture is conspicuous, in the potato fields of southern New Jersey, the pea fields of Idaho, the cotton fields of Arizona, in California, and in the orchards of Yakima Valley, Wash."2

The development of large-scale processing industries has also affected concentration in the ownership of farm lands. For example, the California Packing Corporation owns and operates some 20,000 acres of farm land in California valued at $9,000,000. The corporation leases and operates an additional 47,000 acres in Illinois, Hawaii, and the Philippine Islands. American Fruit Growers, Inc., another Nation-wide shipping and brokerage firm, owns some 15,000 acres of farm land in 10 States, of which 2,500 were planted with citrus fruits, grapes, and vegetables in California.63

While the increase in tenancy may not directly measure the extent of concentration of ownership of farm lands, it does mean that an increased number of small landholders, once displaced or reduced to a tenant status, will find no opportunity to regain their ownership position. The process of concentration is occurring at a time when virtually all the better lands are already under cultivation.

Increase in the Holdings of Financial Institutions.

The decline in agricultural income after 1929 and the drought of the middle thirties caused widespread mortgage foreclosures and transfers of land because of tax delinquencies. Thus, the real estate holdings of institutional lenders and governmental units have increased tremendously, at the expense of individual owners. No national data are available on the extent of land transfers through tax deeds, but

Bureau of the Census, United States Census of Agriculture, 1935, vol. III, p. 107.

81 Hearings before the Temporary National Economic Committee, Part 30, Technology and Concentration of Economic Power, pp. 17042-17043.

62

82 Ibid., p. 17068.

table 43 shows the value of farm real estate held by the leading lending agencies from 1929 to 1939.

TABLE 43.-Farm real estate held by leading lending agencies, Jan. 1, 1929–39

Investment, including sheriffs' certificates and judgments. Excluding prior liens.

2 Investment-partially estimated.

3 Carrying value of real estate, including sheriffs' certificates and judgments. Real estate held by banks in receivership included at book value.

4 Book value.

5 Investment. Rural Credit Board of South Dakota, Bank of North Dakota, and Department of Rural Credit of Minnesota.

6 Data unavailable. 7 June 30.

Source: Hearing before the Temporary National Economic Committee, Part 28, exhibit 2280, p. 15506.

Life insurance companies account for a predominant share of the farm property held by the lending agencies. Their holdings at the end of 1938 were more than double the amount held by all the other agencies combined.

The 26 largest life insurance companies owned farm real estate valued at $529,000,000. Thus, these companies alone owned more than one and one-half times the amount held by the other lending agencies. Large-scale Farming in the United States.

64

Although farm ownership today can be generally characterized as shifting from the "family-size" type of farm, owned and operated by a resident farmer, to the manager-laborer type of large-scale farming, it is impossible to determine the extent of concentration in large landholdings.

The last available statistics on farm operations were gathered by the Bureau of the Census in 1930. These data, however, are compiled for operating units rather than for all farm lands held by a single owner or a single legal entry.

A farm is defined for census purposes as all the land which is directly farmed by one person (or partnership) either by his own labor alone or with the assistance of members of his household or hired employees. Farms operated in this fashion may include owned as well as rented land. But when a landowner turns over the operation of his land to one or more tenants, renters, or managers, the land operated by each is considered a farm.65

Even on the basis of the census data described above, a study made of large-scale farming in the United States in 1929 66 indicated that

63 Ibid., p. 17062.

64 See Hearings before the Temporary National Economic Committee, Part 10-A, Life Insurance, p. 180.

65 Fifteenth Census of the United States, 1930, Agriculture, vol. I, p. 1.

66 R. D. Jennings, Large-scale Farming in the United States, 1929, Fifteenth Census of the United States, 1930, Agriculture, Washington, 1933.

there were 7,875 farms whose value of products was $30,000 or over. These were distributed in various regions of the country as follows: 67 New England and Middle Atlantic_.

North Central___

South Atlantic and East South Central_

West South Central..

Mountain

Pacific____

779

862

810

962

1, 124

3,338

It can be seen that large-scale operations were particularly characteristic of the West South Central, Mountain, and Pacific States.

Table 44 indicates that while large-scale farms constituted only onehalf of 1 percent of all farms in the Mountain region, they accounted for 17.2 percent of all land in farms of that region, 6.8 percent of the TALE 44.-Farms with product value over $30,000, as percentage of all farms, in various regions, 1929

Source: R. D. Jennings, Large-Scale Farming in the United States, 1929. Fifteenth Census of the United States. 1930, Agriculture, Washington, 1933, pp. 24-25.

total value of land and buildings, 18 percent of all expenditures for hired labor, and 10.9 percent of the values of all products sold.

Large farms are prevalent throughout the Pacific States, but they are predominant in California. Although the State had only 2.2 percent of all farms in the United States,68 it had 3,338 (36.7 percent) of the 7,875 large farms (product value over $30,000). According to table 24, 2.1 percent of the farms in California containing 25.4 percent of all farm land, accounted for 21.4 percent of all acreage harvested, received 28.5 percent of the value of all farm products, and paid 34.6 percent of all wages paid for farm labor in the State.

The apparent predominance of large landholdings in the Mountain and Pacific Coast States shown in this study is no doubt due in part to the exclusion of tenant- and cropper-operated areas, particularly in the South. Another study completed in 1933, employing a somewhat different definition of a large-scale farm 69 and including a wide variety of farm tenure, indicated that, with the exception of California, the largest numbers of large-scale farms were located in the Eastern and Southern States.70

7 Ibid., p. 21.

G. Alvin Carpenter, Farm Size in California, Bureau of Agricultural Economics, Berkeley, Calif.. 1940, p. 27.

D. Curtis Mumford, Large-Scale Farming in the United States, Bureau of Agricultural Economics, Washington, 1938.

"A large-scale" farm was defined as a single farm or a group of farms under one closely controlled and supervised management, if the size of its total farm business was at least five to eight times as large as the typical farm business in the same locality producing the same kinds of products (ibid., p. 2).

70 Ibid., pp. 7-9.

Of the 1,116 farms studied in this survey, 53.9 percent were owned by individuals, 25.4 percent by corporations, 17.7 percent by partnerships, and 3.0 percent by estates, trusts, and combinations of the abovementioned categories of ownership. These were farms actually in operation, and the corporate holdings do not reflect the ownership of financial institutions holding lands for resale. Corporate ownership was found to be most frequent in the Mountain and Pacific States.71 Plantations in the South."-The plantation area of the South has traditionally been characterized by concentration of ownership of large tracts of land. However, changes have occurred in the size of plantations since the Civil War.73

Up to about 1910 there was a disintegration of the extremely large plantations (many of these were over 1,000 acres) and an increase in the number of smaller "family-sized" farms. In a study made of 20 Georgia plantation counties, tracts of 260 acres or more (which constituted 38 percent of all tracts in 1873) were found to be 16 percent of the total in 1934. Most of these changes took place between 1873 and 1902, but there was a steady decline in the average size of agricultural proprietorships, from 343 acres in 1873 to 185 acres in 1934.74 In 38 selected counties in North Carolina, Georgia, and Mississippi in the same year, 12 percent of the proprietorships were 260 acres and over, 53 percent were between 50 and 260 acres, and 35 percent were below 50 acres.75

In recent years, however, recurrent agricultural crises have greatly increased tenancy at the expense of ownership among the small farm operators. While the large landowners have reduced their debts, expanded their acreage and investments, and increased their incomes, small farm owners have been forced off the better land or reduced to the status of tenant or sharecropper. Many of those already in the latter class have been displaced altogether from the farm economy of the South.76

Large landholdings have persisted most markedly in the areas adapted to large-scale cotton production. In addition to the ownership of large acreages of the best land in these areas, plantation owners have acquired, through rental or purchase, additional lands in other parts of the South. A survey made in 1937 of the 38 counties studied in 1934 showed that if rented lands and purchases of noncontiguous tracts were included, the average size of plantations increased from 955 acres in 1934 to 1,014 in 1937. In 1934, 39 percent of the landlords reported owning other farms with an average of 2.9 other farms per multiple owner.78

From 1910 to 1923 large areas in the South were progressively laid waste by the boll weevil, with the result that banks, insurance com

71 Ibid., pp. 22-23.

72 For a more adequate discussion of land ownership in the South, see T. J. Woofter, Jr., et al., Landlord and Tenant on the Cotton Plantation, Works Progress Administration, Research Monograph V, Washington, 1936, especially pp. 15-24; Work Projects Administration, The Plantation South Today, Social Problems Series No. 5, Washington, 1940, pp. 1-7; and William C. Holley, Ellen Winston, and T. J. Woofter, Jr., The Plantation South, 1934-37, Work Projects Administration, Research Monograph XXII, Washington, 1940. 73 T. J. Woofter et al., Landlord and Tenant on the Cotton Plantation, p. xix. 74 Ibid., p. 17. 75 Idem.

76 See Work Projects Administration, The Plantation South Today, pp. 7–8. 77 Ibid., p. 8.

It is

Of the 631

78 T. J. Woofter et al., Landlord and Tenant on the Cotton Plantation, pp. 20-21. interesting to note the method of acquisition of the original plantation tracts. planters studied in 1934, 186 acquired their first tract by inheritance, 5 by marriage, 21 by foreclosure, 357 by purchase, and 62 by renting. Only 21 percent of the acreage surveyed had been acquired before 1910, while 41 percent had been acquired since 1925, and 21 percent had been held less than 5 years. (Idem.)

panies, and mortgage companies took over by foreclosure vast acreages in holdings scattered throughout the plantation belt. The depression of the 1930's added still more foreclosures, so that by 1934 a large number of tracts was held by financial corporations. The sample study of 38 counties in 1937 indicated that about 10 percent of the land was corporate-owned. In some counties the proportion of corporation-held land was as high as 20 percent of the total acreage."

OWNERSHIP OF HOMES

79

The census of 1930 indicated that about 14,000,000 homes, or 48 percent, were owner-occupied, out of a total of a little more than 29,000,000 farm and urban homes in the United States. Of the 22,850,000 urban homes, 46 percent were owned and 54 percent rented, while of the 6,290,000 farm homes 57 percent were owned and 43 percent rented.80 These data, however, do not reflect the number of homes lost through mortgage foreclosures and tax sales during the depression

years.

Even at the end of 1938 the total value of repossessed residential real estate held by financial institutions and individuals alone was estimated to be well aboue $4,000,000,000.81

Table 45 shows the value of one- to four-family dwellings owned by selected financial institutions on December 31, 1938.

TABLE 45.-Estimated admitted holdings of residential properties by selected financial institutions, Dec. 31, 1938

1 Estimate based on reports received by the Federal Home Loan Bank Board.

Amount

(millions)

$950

500

315

576

489

2, 830

2 Estimates based on the reports of the Comptroller of the Currency and the Federal Deposit Insurance Corporation. The estimate for commercial banks excludes trust departments.

3 Estimate of the Federal Home Loan Bank Board based on a questionnaire survey of the largest life insurance companies.

Source: Federal Home Loan Bank Board, Annual Report, 1939, p. 28.

The studies on consumer incomes and expenditures of the National Resources Committee indicate that homes owned by individuals have by no means been equally distributed among the various income classes. Table 46 shows that in 1935-36, an increasing proportion of the families owned homes as the family income level increased. While the table describes urban families only, essentially the same pattern of ownership is discernible for rural nonfarm and farm families, except that in the case of the last two groups a larger percentage of the families in all income groups owned homes.82

79 Idem.

80 Bureau of the Census, Statistical Abstract, 1939, pp. 50-55.

81 Federal Home Loan Bank Board, Annual Report, 1939, p. 28.

82 See forthcoming publication by the National Resources Planning Board, Family Expenditures in the United States.