Chapter 2
James Powers' Plan

Long before 1873, the Northern Pacific's land agent to northern Dakota Territory, James Power, argued for large-scale, showcase farms to advertise the economic promise of the land along the Northern Pacific's route; primarily, the land along the Minnesota, Dakota Territory border: the Red River Valley.

Power's belief was it would take too much time for the region to be settled and the prairie turn into farmland if the railroad sold land in small parcels. He argued the only way to make the region commercially viable in the time needed for the railroad to survive was by bringing in large-scale farming operations. One farmer with a single mule or ox can break only so much sod in a season. Perhaps forty acres depending on the soil condition. However, a large-scale farmer with a team of a hundred laborers and two hundred mules could turn thousands of acres of prairie into farmland in the same time span.

With the crash of '73, suddenly the Northern Pacific had on its hands upset bondholders in possession of worthless Northern Pacific bonds. This situation pushed the Northern Pacific into making an offer to the bondholders: the railroad would exchange land for the bonds, honoring the bonds' face value. For bondholders, this meant the opportunity of purchasing valuable railroad land at a heavily discounted price. For James Power, it meant the realization of his vision for large-scale farming in the Red River Valley.

From these events the bonanza farms were born.