Farmers wanted to be their own masters
The speculation driven boom in New Zealand dairy farm prices of the mid to late 1920s, coupled with their newly found individual independence, created financial ruin for many men who had returned from World War I.
Unlike many of their English counterparts New Zealand dairy farmers all wanted to be their own masters. They would own the land, their dairy herds and everything on the farm. That meant there was no land owning upper class with inherited privilege and wealth to weathier financial storms and there would be no poverty stricken underclass of agricultural workers. It was one of the many things their grandparents had been determined to leave behind in Britain when they immigrated. It also mean dairy farmers could not walk off the land and find another job in town when times became financially tough as they could have if their farms had been leased as in Britain.
There was a system of share-milking but for most this was a transition to eventual farm ownership, not a life time occupation.
Dairying was still relatively profitable for those who could manage their debt burdens. Small, unsustainable, units, particularly in the more favoured easily drained, areas were bought up by neighbours, herd sizes increased and dairying became even more profitable for some. A significant element of that profitability came from exports to the seemingly insatiable British market for New Zealand butter and frozen mutton. Tragically it was a single market on which New Zealand had become too dependent. When the British economy collapsed in the early 1930s the New Zealand economy collapsed with it. Exports fell by about 45 per cent and interest rates on the national debt added to the problem.
Great Britain and America at that time were two of the key players in the rapid development of international trade between the major world economies as they struggled to recover from World War I. New technology had replaced some of the more labour intensive production systems and all manner of commodities, from motor vehicles to electric toasters and everything in between were suddenly available and affordable to working people throughout most of the western world.
Like the Waikato dairy boom of the 1920s the American economic flush of the same time was built on agricultural production. Horses were gradually replaced by internal combustion engines allowing acreages of grain cropping to increase to an all-time high of a billion bushels of wheat from 60 million acres in 1926. Grain growers were wealthy but not for long. As with Waikato dairy farms, speculators in America pushed the price of land to unaffordable levels and before long many farmers, particularly those younger men who were determined to own their own properties, were so deeply in debt to banks and money lenders that they lost everything in mortgagee sales.
At the same time the American Government of the 1920s had taken and increasingly hard line on trade unions. Wages fell, or failed to keep up with inflation, and working people could no longer afford to pay cash for the mesmerising array of new luxury gadgets on the market and relied on credit to keep pace with their neighbours.
An economic crash was inevitable but when it came it was bigger and more devastating than anyone could have imagined. Factories reduced production and then closed down, putting thousands and then millions out of work, banks collapsed by the hundred taking the life savings of a whole generation of retired people and then, in October 1929 the Wall Street Stock Market crashed and millions of dollars in long term investment accounts disappeared overnight.
The tough times were not confined to retired city dwellers and factory workers. While relief agencies and various American charities struggled to keep millions of unemployed and homeless people from starvation, the most severe drought in American history hit the 22 grain growing states in the Great Plains, Midwest and the South. Grain fields became dust bowls and thousands of families who had survived the speculator boom, simply walked off their farms in search of shelter and food. There were no jobs to find. Their carefully tilled top soil was blown away in millions of tons, their villages became ghost towns and many no longer exist beyond history books and faded sepia toned photographs. America was broke and the tsunami of financial collapse quickly engulfed Britain, most of Europe except Russia, and eventually reached New Zealand. The Great Depression became indelibly etched in our folk lore with horror stories which only a few of our grandparents can now recall from personal experience. No less vulnerable were young mothers. Birth control, if not prohibited by some churches, was either not well understood, shunned or unavailable to working people.
Most babies in rural regions were born at home, often without medical or expert assistance and infant mortality rates increased as malnutrition became an everyday fact of life.
In spite of our isolation, small population and ability to grow food cheaply individual independence at home and dependence on a single export market had brought a terrible price for New Zealand.