Key Topic 1: The US Economy 1919-29

Impact of the first world war.
1. Europe at the end of the war.
  1. War ended in 1918.
  2. Many European countries borrowed huge sums of money.
    1. Britain- $4,277
    2. France- $3,405
  3. Production of ordinary goods were destoroyed by the fighting.
2. The USA at the end of the war
  1. USA had no war damage.
  2. US farms and factories producing at full capacity
    1. To export goods to Britain and France.
3. Indusrty
  1. Mass Production.
    1. Making goods that have standardized parts to make them quicker and cheaper to assemble.
  2. After the war ended they could make good cheaply and quickly.
4. Argricultre
  1. European troubled with food shortages.
  2. Campaigns asked for US people to eat less food.
  3. Ploughed up land that was previously used for cattle grazing.
    1. To produce more food.
  4. In early 1920's USA was producing.....
    1. 30% of worlds wheat.
    2. 75% of its corn
    3. 55% of cotton
    4. 70% of its petrol.
5. A time of adjustment
  1. Laissez Faire
    1. The policy that buisnesses can run their own affairs rather than passing laws.
    2. Lead to a problem after the war
      1. Prices dropped and wages fell.
        Strikes and un-employment rose
6. Isolationism
  1. USA didn't want to be part of world affairs.
7. Financial Isolationism
  1. Made some exceptions in early 1920's
  2. May 1921, Emergency Tariff Act
    1. Increased the import taxes on wheat, sugar, meat, wool and other.
  3. June 1921, Budget and Accounting Act
    1. put control on government spending
  4. November 1921, Revenue Act
    1. changed taxes, charging buisnesses more, but cutting the wartime tax on high levels of profit.
  5. September 1922, Fordney and McCumber Tarriff Act
    1. Raised Tariffs.
8. Immigration restrictions.
  1. Previously it had an 'open door policy'
  2. 1900-1920
    1. 12.5 immigrants
  3. 1921 Emergancy quota Act
    1. 3% let in
      Nota:
      - 3% of the original amount where aloud to come through before.
  4. 1924 Immigration Act
    1. 2%
    2. 150,000 aloud through
Not all winners
1. the older industries
  1. e.g. coalmining, shipbuilding and railway.
  2. Coal was no longer needed due to the new electricity
2. problems with farmers
  1. during the war they were in full production
  2. prohibition meant they didn't need wheat or grapes.
  3. new clothing fabrics, meant cotton and wool went out of demand.
3. low paid workers
  1. sharecroppers
Boom!
1. Made new products cheaper.
2. Wages were rising
  1. rose by 8% in the 1920's
3. Many goods ran of electricity
4. Hire purchase
  1. Buy and pay later
5. buying shares
  1. ordinary people stared to buy and sell shares
6. the stock market boom.
  1. as more and more ordinary US people brought shares indrusties went up.
7. buying on the margin
  1. people would borrow money from banks and then buy shares due to the prices going up people would make a profit and then sell them at a higher price, give the loan back with a profit.
8. what is a share.
  1. a share in a company
  2. end of year profits are shared between share holders
Mass Production
1. Mass producing a Ford
  1. one kind of car
    1. Standarization
  2. Division of labour
  3. Assembly Line
    1. 12 hr per car
    2. 1hr 33 minuets
2. Due to ford creating mass production many other companies used mass production within their factories
  1. e.g. Radio and Fridges
3. effects
  1. Made producing a product cheaper and quicker
  2. 1908 $850 for one car
  3. 1926 $300 per car
  4. 1m cars in the US 1915
  5. 28m in 1939
  6. ford used alot of other markets.

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Key Topic 1: The US Economy 1919-29

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