In 1900, roughly 40 percent of the American workforce labored on farms. The work was backbreaking, seasonal, and poorly compensated. A single farmer might produce enough food for a handful of people beyond his own family. Crop yields depended on weather, manual labor, and centuries-old techniques. Famine, while less common in America than in much of the world, remained a genuine fear within living memory.
Today, less than 2 percent of the American workforce is employed in agriculture. And that 2 percent doesn’t just feed America — it feeds a substantial portion of the planet. Total U.S. farm output nearly tripled between 1948 and 2017, even as total labor hours in the farm sector declined by more than 80 percent. The United States is the world’s largest agricultural exporter, running a trade surplus in food products every year for more than two decades. American farms produce so much food, so efficiently, that the country’s primary agricultural policy challenge is not scarcity but surplus.
This is a capitalism story — arguably the most important one that almost nobody tells. It is the story of how private land ownership, competitive markets, private capital investment, and decentralized innovation turned American agriculture into the most productive food system in human history. And it is a story that stands in damning contrast to every attempt to achieve the same result through central planning.
The Machinery of Abundance
The transformation of American agriculture did not happen by accident or by government decree. It happened because millions of independent farmers, operating on privately owned land, responding to market prices, and financed by private capital, adopted new technologies that made their labor exponentially more productive.
The timeline is a progression of capitalist innovation. Cyrus McCormick patented the mechanical reaper in 1834, a device that could harvest grain five times faster than a man with a scythe. McCormick did not invent the reaper for the public good — he invented it to sell. He built a factory in Chicago, pioneered installment-plan financing so that farmers who couldn’t afford the upfront cost could pay over time, and offered a money-back guarantee. By the time of the Civil War, McCormick’s reapers were freeing thousands of farm laborers for factory work and military service. He became one of the wealthiest men in America. His customers became more productive farmers. Both outcomes were driven by the same mechanism: a private entrepreneur responding to a market opportunity.
John Deere followed a similar path. His steel plow, introduced in the 1830s, solved a problem that had plagued farmers moving into the dense, sticky soils of the Midwest — cast iron plows couldn’t cut through the prairie earth without constant scraping. Deere’s steel plow sliced cleanly through Midwestern soil, opening millions of acres to cultivation. Like McCormick, Deere built a company around his innovation, scaling production, improving the product, and reinvesting profits into research and development. Deere & Company remains one of the world’s largest agricultural equipment manufacturers nearly two centuries later.
The internal combustion engine, developed in the late nineteenth century, powered the most dramatic leap in farm productivity. Tractors replaced horses and oxen, eliminating the need to devote vast acreage to growing feed for draft animals. A single tractor could do the work of dozens of men and horses. By the mid-twentieth century, mechanization had so thoroughly transformed farming that the number of self-employed and family farm workers fell from 7.6 million in 1950 to roughly 2 million by 2000 — a 73 percent reduction — even as total output soared.
Each of these innovations was developed by private entrepreneurs, financed by private capital, adopted by independent farmers responding to competitive pressure, and distributed through commercial markets. No government bureau designed the mechanical reaper. No central planner decided that tractors should replace horses. The transformation happened because the price system told farmers that labor was expensive and machinery was getting cheaper — and because the legal framework of American capitalism (private property, enforceable contracts, patent protection, access to credit) gave them the means and the incentive to act on that information.
The Man Who Saved a Billion Lives
The most consequential agricultural innovation of the twentieth century came not from a government laboratory but from a collaboration between a private foundation, a foreign government, and one stubborn Iowa-born agronomist named Norman Borlaug.
In 1944, the Rockefeller Foundation — a private philanthropic organization funded by the fortune John D. Rockefeller had accumulated through the oil industry — partnered with the Mexican government to launch a crop improvement program. The program’s goal was to solve Mexico’s chronic wheat shortages, which forced the country to import more than half of its wheat supply. The Foundation recruited Borlaug, a plant pathologist who had earned his doctorate at the University of Minnesota, to lead the wheat improvement effort.
Over the next two decades, Borlaug developed a series of semi-dwarf, high-yield, disease-resistant wheat varieties that fundamentally altered the relationship between human population and food supply. His approach was relentlessly empirical — breeding and crossbreeding thousands of strains, testing them in different climates and soil conditions, and selecting for the combination of traits that maximized yield while resisting the plant diseases that had historically devastated wheat crops. By 1956, Mexico had achieved self-sufficiency in wheat. By 1963, 95 percent of Mexican wheat crops used Borlaug’s varieties.
The implications extended far beyond Mexico. In the 1960s, India and Pakistan faced a food crisis so severe that prominent scientists — most notably Paul Ehrlich in his 1968 book The Population Bomb — predicted that hundreds of millions of people would starve to death within decades. Borlaug’s semi-dwarf wheat varieties were introduced to the Indian subcontinent in the mid-1960s. The results were extraordinary. Pakistan’s wheat yields nearly doubled, from 4.6 million tons in 1965 to 7.3 million tons in 1970. Pakistan achieved wheat self-sufficiency by 1968. India’s wheat production rose from 12.3 million tons in 1965 to 20.1 million tons in 1970. By 1974, India was self-sufficient in all cereals. The world’s grain supply grew more than 150 percent between 1950 and 1992.
In 1970, Borlaug was awarded the Nobel Peace Prize — the only agronomist ever to receive the honor. The Congressional Gold Medal he later received estimated that his work had saved more than a billion lives. The Atlantic Monthly wrote in 1997 that Norman Borlaug had “saved more lives than any other person who has ever lived.”
The Borlaug story is a capitalism story at every level. The Rockefeller Foundation that funded his research was itself a product of capitalist wealth — created from the profits of Standard Oil, the company that had reduced the price of kerosene by 80 percent and brought affordable light to working-class homes across America. The research institutions that sustained Borlaug’s work — CIMMYT in Mexico, the International Rice Research Institute in the Philippines — were funded by a combination of private foundations and market-oriented governments. The fertilizers, irrigation systems, and distribution networks that delivered Borlaug’s seeds to farmers worldwide were produced and maintained by private enterprise. And the price signals that told farmers in India and Pakistan which crops to plant, and in what quantities, came from functioning (if imperfect) agricultural markets.
Borlaug himself understood the political dimensions of his work. He warned repeatedly about what he called “the population monster” and insisted that the Green Revolution had not solved world hunger — it had bought humanity time. But he was equally insistent that the tools of science, deployed through private institutions and market incentives, were the only viable path to feeding a growing world. The biggest obstacle to his work, Borlaug once said, was the “constant pessimism and scare-mongering” of those who argued that mass starvation was inevitable and that technology could not help.
The Contrast: Farming by Committee
Every attempt to achieve comparable agricultural productivity through central planning has failed. The failures are not marginal. They are catastrophic.
Soviet collective agriculture — described in detail in Installment 4 of this series — was the most sustained and well-resourced experiment in state-run farming ever attempted. The Soviet Union possessed some of the most fertile land on Earth, including the black soil belt of Ukraine. It had a large, educated agricultural workforce. It devoted enormous state resources to farming. And it failed so thoroughly that, by the 1980s, a country with more arable land than any other on the planet could not feed its own people without importing grain from capitalist nations.
The reasons were structural and predictable. Collective farms eliminated private ownership, which eliminated the incentive for individual farmers to invest in their land, maintain their equipment, or maximize their yields. Administered prices bore no relationship to actual supply and demand, so farmers had no way to know what to plant or how much. Production targets were set by bureaucrats in Moscow who had never visited the farms they were managing. And the system of reporting was so thoroughly corrupted — local officials inflating numbers to avoid punishment, regional officials passing the inflated numbers upward — that the planners were making decisions based on fiction.
One detail captures the absurdity with devastating precision. By 1990, private garden plots in the Soviet Union — small parcels of land that families were permitted to cultivate for personal use — accounted for nearly 30 percent of total Soviet agricultural output, despite representing a tiny fraction of total farmland. On their private plots, Soviet citizens grew food with the care and efficiency that comes from personal ownership and personal reward. On the collective farms, they did as little as they could get away with, because the system offered no reward for doing more. The price system, operating on postage-stamp-sized garden plots, outperformed central planning operating on millions of acres.
China’s experience was even more devastating. Mao’s Great Leap Forward — which diverted tens of millions of farmers from agriculture to backyard steel production and abolished private food cultivation — produced the deadliest famine in human history. It was only after Deng Xiaoping introduced market reforms in 1978, beginning with the re-establishment of private farming through the household responsibility system, that Chinese agricultural output exploded. Within five years of allowing farmers to sell surplus crops at market prices, China’s grain production increased by a third. The Chinese people were not rescued from hunger by better central planning. They were rescued by the reintroduction of private incentives and market prices — the basic machinery of capitalism.
The Futures Market: Managing Weather Risk
One of the least understood but most important capitalist innovations in agriculture is the commodity futures market — a financial instrument that allows farmers to manage the one risk that no amount of technology can eliminate: weather.
A futures contract is an agreement to buy or sell a commodity at a specified price on a specified future date. A wheat farmer in Kansas, facing uncertainty about what the price of wheat will be at harvest time, can sell a futures contract that locks in a price today. If the price falls by harvest, he is protected. If the price rises, he forgoes the upside — but he has eliminated the risk that a price collapse could wipe out his income for the year.
The Chicago Board of Trade, established in 1848, pioneered commodity futures trading in the United States. For nearly two centuries, these markets have served as the price discovery mechanism for global agriculture — aggregating information about supply, demand, weather, transportation costs, and storage capacity into a single number that farmers, processors, and consumers can use to make informed decisions.
No command economy has ever produced anything comparable. Soviet farmers had no way to hedge against weather risk because there were no markets in which to do so. When harvests were poor, the state absorbed the losses — which meant the entire population absorbed them through reduced rations. When harvests were good, the state captured the surplus — which meant farmers had no incentive to produce a good harvest in the first place. The futures market solves both problems simultaneously: it distributes risk across willing participants and provides price signals that guide planting decisions. It is invisible infrastructure, and it is entirely a product of capitalism.
What Abundance Looks Like
The result of two centuries of capitalist agricultural innovation is a world in which the fundamental relationship between humanity and food has been inverted.
For most of human history, the central economic problem was producing enough calories to survive. Famine was a regular feature of the human experience, killing millions in every century. As recently as the 1960s, serious scientists predicted that population growth would outstrip food production and that mass starvation was inevitable.
It did not happen. Global food production has outpaced population growth for decades. The percentage of the world’s population that is undernourished has fallen from over 30 percent in the 1970s to under 10 percent today. Caloric availability per capita has increased in every region of the world. The American consumer spends a smaller share of income on food than consumers in any other country — roughly 6 to 7 percent of disposable income, compared to over 30 percent in many developing nations and over 50 percent in the poorest countries.
This abundance was not decreed. It was produced — by McCormick’s reapers and Deere’s plows, by Borlaug’s dwarf wheat and the Rockefeller Foundation’s investment, by the Chicago futures market and the Iowa corn farmer checking commodity prices on his phone, by the venture capitalists funding precision agriculture startups and the agrochemical companies developing drought-resistant seed varieties. Every link in the chain that feeds the world is a link forged by private enterprise, guided by market prices, and sustained by the profit motive.
The critics of capitalism rarely mention agriculture. They should. It is the domain in which capitalism’s superiority over every alternative system is most thoroughly documented, most empirically irrefutable, and most consequential for human welfare. The system that feeds the world is not a planned system. It is a market system — messy, decentralized, profit-driven, and spectacularly effective.
No one planned abundance. Capitalism produced it anyway.
Next in the series: Installment 9 — Soft Socialism’s Hidden Price Tag: What the Scandinavian Model Actually Proves