As farmers planted fence row to fence row and as export markets continued to expand, U.S. consumers eventually faced price hikes for food, and there was a backlash against agriculture.
At the same time as the 1972 Russian wheat deal, the U.S. economy was in a period of spiraling inflation – workers were demanding higher wages, so companies passed the increases on to consumers (who are also workers), who then demanded higher wages to keep up. In the summer of 1971 – in the middle of a presidential election – President Nixon imposed a wage and price freeze to woo potential voters.
In 1972, after he won the election, Nixon relaxed the freeze and food prices shot up. The Russian grain sale caused at least part of those increases.
By 1973, the inflation rate for groceries reached an all-time high of 20 percent in one year, and housewives were organizing protests at supermarkets. U.S. News and World Report asked in a headline, “Why [is there] a Food Scare in a Land of Plenty?” And Time magazine devoted their April 9, 1973, cover to an angry face off between an irate housewife boycotting meat because of high prices and a livestock producer holding his animals off the market until his animal feed prices came down.
Of course, what was bad for the consumer was good for the grain farmers, and farm incomes overall pulled ahead of average urban incomes for a short time in the mid-70s.
In the end, there were (and are) many more consumers than farmers, and eventually tales of consumer nightmares got the attention of the administration.
- In a Milwaukee supermarket, an aged shopper who found that her grocery bill total $1.80 more than the cash in her purse asked the clerk to remove a can of cat food from her order. The clerk offered to pay for it because, “I wouldn’t want your cat to go hungry.” The woman replied, with a weak smile, “I’m the cat.”
- Public school systems, even in farm states like Des Moines, Iowa, began substituting peanut butter and beans for expensive meat dishes.
- Supermarkets reported a rising number of thefts from meat counters. A prosecutor in Illinois said the thieves were “for the most part, people who are otherwise respectable; they are probably just hungry.”
- Professional thieves hijacked more meat trucks than usual. One gang in Atlanta held up a van, blindfolded the driver and unloaded $4,000 worth of meat.
- Others tried to find humor in the situation. A café owner in Washington state posted a sign telling his patrons, “Next week, all meat dishes by sealed bid only.”
This kind of righteous anger sparked the Nixon administration to re-impose price controls in 1973, particularly on food.
Written by Bill Ganzel, the Ganzel Group. First published in 2009. A partial bibliography of sources is here.