This dazzling work in economic fiction is the third of Garet Garrett's novel trilogy, written and first published in 1924. Like the others, Satan's Bushel is a splendid book, not just from the point of view of economics but also as a piece of literature.
What is Satan's Bushel? It is the last bushel that the farmer puts on the market, the one that "breaks the price" — that is, reduces it to the point that wheat farming is no longer profitable. The puzzle that afflicts the wheat farmers is that they sell their goods when the price is low and have no goods to sell when the price is high. Withholding goods from the market is one answer but why would any farmer do that?
What is the answer to this problem? Working from this premise, then, as implausible as it may sound, but the central figure in this book is the price of wheat. It is the main source of drama. The settings are the wheat pit at the Chicago exchange (circa 1915) and the Kansas wheat fields. Linking those two radically different universes is the mission of this book.
The action further explores the meaning, morality, and utility of wheat speculation. The plot is centered at the turn of the 20th century, a critical period when the agricultural economy was completely giving way to the fully industrialized one, and farmers were panicked about the alleged problem of falling prices. The allegory might equally apply to the computer industry today, so there is nothing lost in the passage of time.
It tells the story of one man's discovery of a brilliant speculator and his relationship with an old and legendary farmer/mystic and his daughter. The mystic embodies both the highest wisdom and the greatest economic fallacies of the day. The question that must be confronted is how to make farms profitable in times of falling prices, and the novel shows that speculation, even with all its human foibles, makes a contribution to stabilizing the market.
Here is one of hundreds of brilliant passages describing the speculator:
"No rule of probability contains him. To say that he acts upon impulse, without reflection, in a headlong manner, is true only so far as it goes. Many people have that weakness. With him it is not a weakness. It is a principle of conduct. The impulse in his case is not ungovernable. It does not possess him and overthrow his judgment. It is the other way around. He takes possession of the impulse, mounting it as it were the enchanted steed of the Arabian Nights, and rides it to its kingdom of consequences. What lies at the end is always a surprise; if it is something he doesn't care for, no matter. Another steed is waiting. Meaning to do this, living for it, he has no baggage. There is nothing behind him. If he has wealth it is portable. He is at any moment ready."
In a plot twist that foreshadows the New Deal, one person attempts to destroy the wheat crops with a poisonous fungus, thinking that he is doing the farmers a favor by reducing supply! The reader is confronted with a challenge of coming to understand whether this is really so, and if not, why? Keep in mind that this is written a full decade before FDR attempted the same tactics from the federal level!
Another dramatic scene involves the arrest of an opponent of World War I. Further, there are plot twists that turn on romance, sorcery, criminality, mob behavior, psychological possession, the war, price controls, government interventions, and other surprises and wholly unimaginable things like water witchery and a teak tree in Burma. The central action, however, deals with the core of economics and the place of production and speculation.
To search for Mises Institute titles, enter a keyword and "LvMI" (short for Ludwig von Mises Institute); e.g., "Depression LvMI"
What is Satan's Bushel? It is the last bushel that the farmer puts on the market, the one that "breaks the price" — that is, reduces it to the point that wheat farming is no longer profitable. The puzzle that afflicts the wheat farmers is that they sell their goods when the price is low and have no goods to sell when the price is high. Withholding goods from the market is one answer but why would any farmer do that?
What is the answer to this problem? Working from this premise, then, as implausible as it may sound, but the central figure in this book is the price of wheat. It is the main source of drama. The settings are the wheat pit at the Chicago exchange (circa 1915) and the Kansas wheat fields. Linking those two radically different universes is the mission of this book.
The action further explores the meaning, morality, and utility of wheat speculation. The plot is centered at the turn of the 20th century, a critical period when the agricultural economy was completely giving way to the fully industrialized one, and farmers were panicked about the alleged problem of falling prices. The allegory might equally apply to the computer industry today, so there is nothing lost in the passage of time.
It tells the story of one man's discovery of a brilliant speculator and his relationship with an old and legendary farmer/mystic and his daughter. The mystic embodies both the highest wisdom and the greatest economic fallacies of the day. The question that must be confronted is how to make farms profitable in times of falling prices, and the novel shows that speculation, even with all its human foibles, makes a contribution to stabilizing the market.
Here is one of hundreds of brilliant passages describing the speculator:
"No rule of probability contains him. To say that he acts upon impulse, without reflection, in a headlong manner, is true only so far as it goes. Many people have that weakness. With him it is not a weakness. It is a principle of conduct. The impulse in his case is not ungovernable. It does not possess him and overthrow his judgment. It is the other way around. He takes possession of the impulse, mounting it as it were the enchanted steed of the Arabian Nights, and rides it to its kingdom of consequences. What lies at the end is always a surprise; if it is something he doesn't care for, no matter. Another steed is waiting. Meaning to do this, living for it, he has no baggage. There is nothing behind him. If he has wealth it is portable. He is at any moment ready."
In a plot twist that foreshadows the New Deal, one person attempts to destroy the wheat crops with a poisonous fungus, thinking that he is doing the farmers a favor by reducing supply! The reader is confronted with a challenge of coming to understand whether this is really so, and if not, why? Keep in mind that this is written a full decade before FDR attempted the same tactics from the federal level!
Another dramatic scene involves the arrest of an opponent of World War I. Further, there are plot twists that turn on romance, sorcery, criminality, mob behavior, psychological possession, the war, price controls, government interventions, and other surprises and wholly unimaginable things like water witchery and a teak tree in Burma. The central action, however, deals with the core of economics and the place of production and speculation.
To search for Mises Institute titles, enter a keyword and "LvMI" (short for Ludwig von Mises Institute); e.g., "Depression LvMI"
