Tough choices and scams hit during hard times
Remembering high flax prices and the destruction of Jerusalem artichokes and land patents.
Dad raised barley, spring and winter wheat, and oats as a companion crop for alfalfa during his farming career. In the mid-1970s, we decided to plant triticale to chop for dairy cow forage.
He also said that he wished he would have raised flax, which was so profitable during World War II that many farmers paid off their mortgages with income from just one harvest. Flaxseed prices in Minnesota averaged $2.27 per bushel from 1940-44, which although good was below the average of $3.04 from 1915-19, when World War I led to increased flaxseed demand.
For contrast, the average U.S. corn price was 99 cents per bushel during World War II and only slightly higher in World War I.
We had never planted triticale before — it was more popular in Europe, where it had been created in the late 19th century from a cross of wheat and rye in German and Scottish laboratories. It produces grain yields comparable to wheat and has the disease resistance of rye. As fodder, it must be harvested before ripening. We may have waited too long, because the cows left most of it uneaten in the bunk.
We never planted triticale again and chalked it up as a failed experiment that didn’t cost us much money. That was not the case in the early 1980s, when many farmers who were suffering from depressed commodity prices turned to what was promoted as a miracle crop alternative to low-priced corn and soybeans.
Jerusalem artichokes were advertised as easy to grow, a source for biofuel, and valuable as livestock feed.
More than 2,500 farmers in North Dakota, Minnesota and South Dakota bought in to what was a giant pyramid marketing scheme. Before the scam was over, farmer-investors' losses reached $30 million and led to bankruptcies.
Fred Hendrickson was the man behind the scheme and his effort gained momentum when he partnered with James Dwire to form America Energy Farming System. Growers who signed with the company could purchase enough seed to plant 1,000 pounds of seed, which was enough to plant approximately 10 acres, for $1.20 per pound.
American Energy salespeople promised profits of up to $6,000 per acre — a before-unimaginable return. Attorneys general in all three states began to smell a rat and investigations were started.
The only profit made was by those who sold artichoke seed.
The pyramid scheme collapsed into Chapter 7 bankruptcy and Hendrickson and Dwire were arrested and convicted. Both served a year or less in prison.
Later in the 1980s, when the farm crisis was at its worst, a man held meetings in Minnesota, Wisconsin and in other states promising to reveal a sure-fired method to stop foreclosures through land patents.
A Wisconsin meeting in Westby drew a huge crowd. The speaker launched into his spiel about the miracle power of purchasing a land patent through his organization. The cost for the document was $35 and many in the crowd lined up to get one.
Earlier, I had written a couple of articles quoting legal experts as saying that the patents were worthless. Hundreds of people across the country had been taken in and authorities would soon act to arrest the scammer.
The scammer had apparently read the articles, which led him to point me out to the crowd. They responded with boos and threats of bodily harm if I didn’t agree to write the truth. It was the only time in my journalism career that I felt such hate.
A few weeks later the patent pitchman was arrested and eventually sentenced to a term in federal prison.
Desperation can lead to belief in miracle cures offered by crooks determined to enrich themselves at others’ expense.
Mychal Wilmes is the retired managing editor of Agri News. He lives in West Concord, Minn., with his wife, Kathy.