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The USA, 1919-41

The Economic Boom of the 1920s
1. American industry and farming had grown steadily
2. The country had huge resources of coal, oil, timber and iron
3. It had a growing population with hard-working immigrants
4. Railways, mining and manufacturing industries were all strong
5. Americans believed in the Republican views of rugged individualism and laissez-faire
6. US businesses made money from WW1 through loans, arms and equipment - made the USA rich, confident and isolationist - not dragged into EU wars.
7. Republicans in charge: President Harding (1921-3) - believed in normalcy. Key Policies: Isolationism, Tariffs and Low Taxes
8. Mass-production made profits rise enormously. Particularly for consumer goods and motor industry - hire purchase and 'buying on the margin'.
American Society in the 1920s
1. First 'talkie' out in 1927 - 'The Jazz Singer' starring Al Jonson. People went to see famous stars like Charlie Chaplin and Rudolph Valentine
2. Hollywood became the centre of world entertainment - there were jazz crazes and people danced the charleston.
  1. Watching films became a national obsession - millions went every week.
3. After WW1, women got the vote. By 1929, 10 million had jobs - free to earn a wage. Led the 'flappers' (wore knee-length skirts, smoked + drank)
4. Intolerance - Red Scare (due to Rsn. Rvl in 1917) and KKK. Worst case was Sacco and Vanzetti Case. 1921 Immigration Act - 1929 - ↓ 850 to 150 th.
5. Strong anti-alcohol temperance groups made Gov. pass 18th Amendment (Volstead Act) to ban sale and manufacture of alcohol.
  1. Massive failure - led to bootleggers, moonshine, speakeasies, bribed agents and gangsters like Al Capone rising.
    1. Al Capone ran Chicago and caused the St. Valentine's Day Massacre in 1929 when 6 members of a rival gang were killed.
The Wall Street Crash and the Depression
1. Long-Term Causes
  1. Overproduction of consumer goods + agriculture, inequality, foreign competition and foreign tariffs.
2. Short-Term Causes
  1. Share speculation, companies forced to pay shareholders profits and Americans buying on credit.
3. September 1929 - share prices started to decrease. Suddenly, everyone realised and started to sell shares. Worst day was 'Black Tuesday' on 29 Oct.
  1. Many became bankrupt, homeless (Hoovervilles), lost savings similarly to farmers.
4. 11,000 banks stopped trading from 1929 to 1933.
5. Hoover - said 'prosperity was around the corner'. Set up the Reconstruction Finance Corporation and tried to help US exports but failed.
  1. Worst was the Bonus Army march in 1932. They were due a bonus by 1945 for the war but wanted it early. Hoover dispersed them with troops.
The First New Deal
1. Roosevelt won by approximately 7 million votes to Hoover, through his 'New Deal'
  1. In office in March 1933 - many banks closed, industrial production down 56% from 1929's
    1. 9 March -> 16 June 1933 - Hundred Days Legislation
2. Emergency Banking Act
  1. Gov. declared a bank holiday to shut banks. Opened 8 days later + backed 5,000 banks. Restored confidence.
3. Securities Exchange Act
  1. Gov. regulated stock market to prevent another 1929 crash
4. Federal Emergency Relief Act (FERA)
  1. $500 million allocated to help the poor (clothing, food, shelter). Seed and equipment for farmers, schemes to create jobs.
5. Tennessee Valley Authority (TVA)
  1. Huge public works projects: dams, irrigation, canals - hydro-electiric power created lots of jobs, farmers given loans and training in soil convservation and new housing built
6. Civilian Conservation Corps (CCC)
  1. Men aged 18-25 given 6 months work but had to sent most of pay home. By 1933, 300,000; by 1940, 2 million
7. Public Works Administration (PWA)
  1. Paid for public works projects (schools, roads) and used the unemployed
8. Agricultural Adjustment Act (AAA)
  1. Advised farmers on marketing and farming techniques - helped overproduction. Became more organised but wealthy farmers gained most.
9. National Industrial Recovery Act (NIRA)
  1. Set up the NRA (Administration) to set standards on working practices (hours). Created more jobs - used the eagle symbol for approval. Over 2 million employers were members.
The Second New Deal
1. Tried to make society fairer for all
  1. In 1935, the WPA replaced the PWA - extended range of work given. From building work to Federal Theatre Project for unemployed artists and writers.
  2. In 1935, the Wagner Act forced employers to recognise trade unions (workers kept protection from NRA)
  3. In 1935, the Social Security Act provided federal aid for elderly and unemployment insurance but not as good as UK
Successes and Failures of the New Deal
1. Business Leaders unhappy with regulations, trade unions and the huge cost
2. States lost individual powers due to measures like the TVA and were worried of Gov's control
3. Republicans thought Giov. was too powerful and ruining their policies. Cons. Democrats opposed him. Radicals like Huey Long and Father Coughlin wanted to go further.
4. Supreme Court (mainly old and Republican) deemed some acts unconstitutional. 1937 - FDR wanted to pack the Supreme Court but failed. After that, they back off.
5. Successes
  1. The Depression didn't lead to extremism, millions of jobs were created and vital relief supplied, farming and industry benefited from the efficient infrastructure.
6. Failures
  1. When FDR cut back in 1937, unemployment ↑! Only reduced unemployment, USA trade didn't recover, blacks didn't gain much and failed to pack Supreme Court
Weaknesses in the US Economy
1. Some major industries like coal and textiles didn't benefit from the 'Boom'
2. Countries reacted to US taxes on imports with their own, reducing demand
3. Farmers produced too much food due to reliance in WW1, making prices low. Incomes fell from $22 b. in 1919 to $13 b. in 1928.
4. Many ordinary Americans didn't prosper as wealth was concentrated with very few - African Americans suffered more due to discrimination and worse jobs

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The USA, 1919-41

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	Created by sagar.joban over 11 years ago