Modern World History: America 1920- 1939

HOW DID THE USA ACHIEVE PROSPERITY IN THE 1920s? 

1.Isolationism 

• Woodrow Wilson (president) - 14 points to peace, wanted to join League of Nations but in 1919 (needed approval of US congress), Americans didn’t want to be involved with Europe’s affairs (‘Normalcy) Republican President, Harding elected- ‘Lassaiz fair’ 
• Economic strength: 

-Advances in technology 

-Taken over American overseas markets (Europe poor after war)

-One way trade with Europe (Food, raw materials etc.) > Industry & agriculture prosper.

-USA exported weapons during the war 

-Joined war in 1917 but no fighting on American soil

3. Immigration problems (see divided society) 

1. Fordney- McCumber Tariff (1922) 

• European goods had to pay 30% duty 
• Harding could higher/ lower tax - power
• Cheaper goods = higher demand 

• Unemployment higher in Europe & people would work for lower wages = products cheaper in Europe than in USA = loss of American jobs, Lower profits, less money in taxes.

• Europe put own tariffs of USA exports but USA market was too strong

1. Mass production

•  Henry Ford: assembly line. Divided manufacturing tasks among workers alongside a moving belt. Production was more efficient so huge reduction in price. 

  1929: 1 car for 5 Americans 

  1920: 1.9m cars  1929: 4.5m cars

•  Advertising encouraged more spending- radio and film commercials 
•  Consumer boom- afford radios, fridges, washing machines, vacuums, phones. 
•  Natural resources = industry = workforce increases
•  Technology: (because of war) New household products, man made materials- fashion, cheap electrical power for factories.
•  Mass produced goods sold to mass market 
•  Mass production = more goods made = more cars sold = more workers needed = pay goes up = more people can afford stuff = greater demand

1. Hire Purchase, shares & the stock market

• Hire purchase- buying in installments, introduced to make cars affordable, encouraged more spending on luxury goods.
• Republican government:

• ‘Lassaiz faire’ attitude = don’t interfere, workers exploited, more jobs & freedom
• Lower taxes on income & company profits= wealthy have more money to invest & more money for people to spend on American goods
• Tariffs on imported goods
• Promoted cheap credit = encouraged banks to lend money on easier terms

• Shares:

• 1.5 million Americans brought shares = prices rocket = people investing
• But people started buying shares on credit in hope of selling them at a profit 
• high confidence 

1. Entertainment 

• Paperback books, motor transport, films, radio, jazz music clubs, dancing 
• Film- mass entertainment, cinemas holding 4000 people, 1927- non silent films, hollywood
• Radio- 1921= one station 1923= 508, millions of radio sets sold, NBC set up in 1926, $150 made from ads.
• Flappers- lipstick, short skirts, high heels
• Church attendance fell, divorce increased, sexual freedom
• Women- new fashions, economic independence (office jobs), household gadgets, more educated (high school, college) 
• BUT women still expected to be homemakers, still discrimination against women in employment, low skilled/low payed jobs, superiority of men. 

 HOW FAR WAS THE USA A DIVIDED SOCIETY IN…