Transcript 1920s econ

U. S. History
January 2016
Warm Up: Describe the economic
policy of 1920s Republicans with
one term.
DOK: 1; S. 2; Learning Target: I can
describe people, events, ideas and
changes of the “roaring 20s”, the
“Jazz Age.”
Class work: Notes A BUSINESS BOOM
 Nothing over
here until we
add
questions
later…
 Before the 1920s:
 No fast food
 No shopping centers
 No billboards or highways
 Value THRIFT: if you need it, you get it with cash,
the essentials
 Credit: immoral
 DOK: 1; S. 2; Learning Target: I can describe
people, events, ideas and changes of the
“roaring 20s”, the “Jazz Age.”
 **1920s:
 Mall (strip)
 A&W root beer
 Roads/roadside – think “Cars”
 Businesses dependent on selling, create “installment
plans”, advertising convinced America credit is OK
 Interest: 11-40%
 CONSUMER economy: depends on big spending
by consumers; incomes UP 28% 1914-1926
 Spend: credit, cost less, advertising, money
available, new products
increased profits
leads to higher wages which leads to
spending…starts all over
 DOK: 1; S. 2; Learning Target: I can describe
people, events, ideas and changes of the “roaring
20s”, the “Jazz Age.”
DOK: 1; S. 2; Learning Target: I can describe people, events, ideas and changes of the “roaring 20s”, the “Jazz Age.”
 Budget: 60% to cars; 70% furnishings; 80%

 What is
advertising
about today?
What do they
use to
convince
folks to BUY?
 How similar
is this to the
1920s?



vacuum, radios, cleaners, refrigerators; 90%
water machine
ELECTRICITY: fridge to the H2O machine; 4X
1913-1927 users; lights 16-63%
Again: Rural vs Urban, wind powered generators
ADVERTISING: GE toasters, ovens, sewing
machines, coffee, irons, vacuums (before it was
basic info, 1920s more about image, insecurity,
fear, celebrities)
PRODUCTIVITY: a worker’s level of output;
GNP: goods and services country produces in a
year; 1921-1929 6% growth per year compared to
1910-1920<1% growth: why? Resources,
management, technologies, oil, assembly line
DOK: 1; S. 2; Learning Target: I can describe people, events, ideas and changes of the “roaring 20s”, the “Jazz Age.”
• Ford and the Auto
• 1880s Germany
• 1892 Charles and Frank Duryea
• 28 years=8 million cars
• 1920s=15million
• Model T: Horseless carriage; 1896 quadricycle
• 1908: 30K Model Ts sold
• Assembly line, didn’t invent but increased efficiency
• Produce more in less time=sell low enough for
•
•
•
•
ordinary citizen can afford
One specialized job, but strained workers
24 seconds =Model T
1908-1927 50% cars made in the world are Model
T
1915 cost $390: black paint dried faster, cheaper
Ford: the good
and not so much
 Violence used to fight
 1914 $5 pay per day
 Don’t fight (WWI)
 Greenfield Village






unions
WWI: Americanization:
English/Civics
Home inspection
Stubborn
Anti-Semite
1918 Dearborne
Scapegoats
 DOK: 1; S. 2; Learning Target: I
can describe people, events, ideas
and changes of the “roaring 20s”,
the “Jazz Age.”
DOK: 1; S. 2; Learning Target: I can describe people, events, ideas and changes of the “roaring 20s”,
the “Jazz Age.”
 GM came out with colors!
 1925 Model T in colors!
 1927= no more Model T, now Model A
 Vertical consolidation: iron mines (steel mills, coal
mines); plant and production; forests, glassworks,
RR, ships
 CHANGES bc of Auto:
 Hwy 66
 Garage
 Car dealers
 Motels
 Restaurants
 Campgrounds
 Gas stations
 Suburbs expand= housing
*steel
*rubber
*gas
*glass
*leather
DOK: 1; S. 2; Learning Target: I can describe people, events, ideas and changes of the “roaring 20s”,
the “Jazz Age.”
 NO BOOM
 Unskilled laborers (African American migrants)
 Agriculture: Farm prices down, borrowed for
machines and land in good times, can’t pay
 Cotton textiles/soft coal: postwar=low profits,
wages
 RR: mismanagement, competition, labor unions
The Economy in the Late 1920s 14.3
 CONFIDENT, robust, innovation
 To what extent
did these grow
out of natural
optimism?
 How should
warning signs
have been
managed
 Do we have
warning signs
now? Are we
managing
them well?
 Danger signs:
 Uneven prosperity
 Debt
 Roller coaster stock market
 Surplus manufacturing
Optimism:
medical advances: less whooping cough, diptheria,
infant deaths; greater life expectancy (59 and 63,
up 10 years)
Hoover in 1928: Rugged individualism; abolition of
poverty and fear, had been secy of commerce,
WWI food relief
DOK: 1; S. 2; Learning Target: I can describe people, events, ideas and
changes of the “roaring 20s”, the “Jazz Age.”
DOK: 1; S. 2; Learning Target: I can describe people, events, ideas and changes of the “roaring 20s”,
the “Jazz Age.”
 1925 stocks $27B
 1928 stocks Up$11B, it’s the weathervane, NYT
 1929 stocks $87B
 What is our
ue now? What
is healthy?
 Wages up 40% since 1914
 Unemployment 4%
 Bruce Barton: The Man Nobody Knows; Jesus in
Business
 Raskob, corporate leader: everybody ought to be
rich
 Save $15 week, in 20 years; have $400 month income
Welfare Capitalism
 Labor strikes, 1919 stable
 AVOID UNION! Intervention, strikes, high productivity
 Raise wages, benefits, company loyalty, morale, company unions
 Less labor unions
DOK: 1; S. 2; Learning Target: I can describe people, events, ideas and changes of the “roaring 20s”,
the “Jazz Age.”
 Warning signs:
1. Uneven prosperity
-rich+richer
-huge corporations not small businesses; 200
companies get 49% industry
-families: 1929 20K families (.1%) had >$100K (34%
country’s savings); 71% individual and families make
<$2500 a year (minimum standard of living, 80% have
NO savings), kids even worked; taxes didn’t help
*Mellon, secy $$ (rich) pushed to lower
taxes only wealthy paid then, they benefitted
2.
3.
Personal debt: affordable/available; b$ fear debt,
waited
Playing Stock Mkt. Get rich quick.
-speculation: make high risk investment to get return, B4 WWI,
buy with cash, now…
DOK: 1; S. 2; Learning Target: I can describe people, events, ideas and changes of the “roaring 20s”,
the “Jazz Age.”
-buy on margin: invest for a “sale price” (10-50% of
real cost of stock) then have a “loan” to pay for the rest- if
you don’t “win”, you lost your money AND have DEBT, b4
just lost money. Brokers can charge interest rates and
demand payment any time
4.
Too many goods, too little demand
-industries slow
-auto slump in 1925: ripples to steel, rubber, glass
-housing also ripples
5.
Trouble for farmers and workers
-debt extra time 6K farms fail
-McNary-Haugen Farm Relief 1927, 28: Coolidge
vetoed: not govt job to increase crop prices
-factory workers/conditions  cotton and textiles,
mining, 56 hour week for 16-18cents= $10 week
Exit
Fill in the “L” of your KWL chart from the first day back. If you didn’t make one
or you have lost it, brainstorm everything about the 1920s you have learned.
DOK: 1; S. 2; Learning Target: I can describe people,
events, ideas and changes of the “roaring 20s”, the
“Jazz Age.”