Bonanza Farms of the Red River Valley

Large tracts of fertile, cheap land led to huge bonanza farms in the late 19th century

| August 2010

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    The blacksmith shop on the F.A. Bagg farm, a restored bonanza farm near Mooreton, N.D.
    Photo by Sam Moore
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    The Red River forms the border between North Dakota and Minnesota, and flows north into Canada, where it empties into Lake Winnipeg. The valley is extremely fertile and, even in the 1870s, was ideal for the use of large farm machinery, being flat and treeless with no stones or rocks.
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    The workers’ bunkhouse on the F.A. Bagg farm. The second floor is the dormitory where the men slept. On the first floor are the kitchen, dining hall, rooms for the cooks and a small sitting room. Most accommodations for workers weren’t this elaborate.
    Photo by Sam Moore

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We hear a lot about factory farms these days but, as they say, “there’s nothing new under the sun.” In Day of the Bonanza, published in 1964, author Hiram M. Drache tells the fascinating story of the rise and fall of the huge bonanza farms in the Red River Valley during the last quarter of the 19th century.

The river forms the border between North Dakota and Minnesota, and flows north into Canada, where it empties into Lake Winnipeg. The valley is extremely fertile and, even in the 1870s, was ideal for the use of large farm machinery, being flat and treeless with no stones or rocks.

Railroad over-leveraged

Since the 1840s, Americans had dreamed of a railroad through the Northwest to the Pacific. In 1864, Congress chartered the Northern Pacific Railway Co., and gave the NP almost 39 million acres of public land along the proposed right of way. Three years of expensive construction followed, during which time the railroad officers borrowed and spent much more than they should have. During the Panic of 1873, the NP filed for bankruptcy, halting all construction.



To raise funds, the NP offered to sell its millions of acres at $5 per acre. However, public opinion sided with Minnesota Governor Henry Sibley, who described the Red River Valley as “fit only for Indians and the Devil.” The railway sold very little land, so it offered to exchange each of its outstanding bonds for $110 worth of land. Since the bankruptcy, the bonds were worth only about 10 or 20 cents on the dollar. Larger bondholders (mostly Northeastern businessmen) traded their bonds for large tracts of land, hoping to get their money back.

Managing massive farms



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