A Newsletter about California Water, Land, and People


Farming and Capital

"It is easy to forget...that a crop does not only spring from the soil....It is deeply ingrained that America's agricultural regions are places that 'settlers' made and less appreciated that at times money got there first."

- George Henderson, California and the Fictions of Capital, 1999

California is one of the places where money got there first. The history of California land bears out the intimate relationship between the state's sudden emergence in the middle of the 19th century and its continuing, ever-elaborating economic dominance -- both within the United States economy, as well as in the interlocking relationships of the Pacific Rim economic region, especially with Asia and Pacific Island nations.

California Aqueduct next to Interstate 5 in the
agriculturally rich San Joaquin Valley, view to north.
Photo courtesy of California Department of Water Resources.

Our defining moment occurred in 1849 with the onset of the California Gold Rush. It transformed California nearly overnight (in a geologic sense) from an isolated region dominated at its coast by Spanish colonial military, ranchero, and Jesuit mission-based development; and its inland and mountain regions were still occupied by Indian tribes whose economies drew on theft of property from the Spanish colonists and on traditional hunting and gathering of native flora and fauna for subsistence.

California became one of the premier sites for accumulating capital through mining, principally through the extraction of gold and silver from the Sierra Nevada. To process the metals, other elements (such as mercury) were mined in other parts of California. Most of the Gold Rush wealth was exported from the mines to San Francisco and back east to the great banks of New York and Chicago.

As the mines played out, capital shifted its attention to agriculture. Many Gold Rush capitalists made their money either directly from the mines, or by supplying the mines with equipment, food, clothing, and other necessities. In the San Joaquin Valley, cattle barons like Henry Miller and James Ben Ali Haggin accumulated vast estates from their profits supplying the mines, and others accumulated estates to grow wheat and other grains (the next great California export after gold) in the 1860s through the 1870s. When international grain markets collapsed in the 1870s, these landed capitalists sought to maintain their profits by selling off portions of their latifundia as more diversified farms that could be sold to urban merchants and new (usually white) migrants to California seeking to farm. As the land barons subdivided, they simultaneously hoped to stimulate the diversification of California's agricultural economy into specialty crops like fruit, nuts, and nursery crops, which are more productive "higher value" crops.

Developer-speculators, backed by San Francisco bankers still flush from the Gold Rush and the Comstock Lode (silver) in Nevada, bought and subdivided the great wheat estates and readied them for a more diversified agriculture. They leveled the land, connected the farms with roads, drained wetlands, built levees, diverted water from streams or drilled wells, and perhaps planted a few acres of a starter crop before putting up the For Sale sign.

Page 3