1.4. The changing quality of life, 1917-80
What was the impact of economic change,1917-80?
Boom, bust and recovery, 1917-41
Post-war depression -
Farming:
o Prices fell
o Farmers had to sack workers; some went bankrupt
Industry:
o Many strikes in 1919 and 1920
o Increasing unemployment
o The coal industry lost out to other fuels
Dropped to 60% by 1930
Government reaction:
o Countries put tariffs on US goods
US exports fell
o Gov. thinking changed when another depression hit in 1929
Boom –
Mass production:
o Mass-produced goods were produced more quickly and cheaply
o People bought more goods
Especially cars and radios
o In 1917, 4,727,468 passenger cars, by 1929, 23,060,421
New Management Techniques:
o Some employers used ‘scientific management ideas’
o Scientific management advised paying good wages and good working conditions
Federal Policies:
o The government kept some of the wartime subsidies to farmers in place and also
cut taxes for businesses to encourage ‘buying American’.
Hire Purchase and Loans:
o More people bought homes and farms on mortgages that banks lent.
o Between 1920 and 1929, consumer debt rose from $3.3 billion to $7.6 billion.
o People were also borrowing more about 10% of their income.
Changing Industry:
o Used higher levels of mechanisation
o Many ran on electricity
o In 1917, there were 7,899,000 homes and businesses wired for electricity: in
1930, 24,555,732
The Stock Market
Bust
Demand began to fall
Companies did not cut production enough, so goods piled up in warehouses
By 1927, unemployment was rising, employers cut waged and working hours
Businesses and banks were in debt and stock market overheated
Stock prices began to fall
, Banks that gambled with customers’ money went bankrupt
The Great Depression
Wall Street Crash significantly worsened the depression
Businesses and banks went bankrupt, unemployment shot up
People lost their homes if they could not afford mortgages
Homelessness and poverty increased
Hoover tried to push federal action, but most Republican Congress was unwilling to
agree
o Hoover lost the election to Roosevelt and his New Deal promises
Recovery
Roosevelt closed the banks
FED officials inspected the banks and reopened the healthy ones
Created jobs and helped those with loans
Droughts made the Great Plains a dust bowl
o Many farmers lost their farms and became migrant workers
Roosevelt ran up huge government debts funding the New Deal
The Federal Housing Administration oversaw slum clearance and the building of
housing for low-income families
The Second Agricultural Adjustment Act provided subsides for farmers to produce
less
Recovery was not certain
o There were still more unemployed and homeless people
Roosevelt moved to war production to help the Allies
o The USA joined the war in 1941
Which had an effect on creating jobs in factories and the military
What was the impact of economic change,1917-80?
Boom, bust and recovery, 1917-41
Post-war depression -
Farming:
o Prices fell
o Farmers had to sack workers; some went bankrupt
Industry:
o Many strikes in 1919 and 1920
o Increasing unemployment
o The coal industry lost out to other fuels
Dropped to 60% by 1930
Government reaction:
o Countries put tariffs on US goods
US exports fell
o Gov. thinking changed when another depression hit in 1929
Boom –
Mass production:
o Mass-produced goods were produced more quickly and cheaply
o People bought more goods
Especially cars and radios
o In 1917, 4,727,468 passenger cars, by 1929, 23,060,421
New Management Techniques:
o Some employers used ‘scientific management ideas’
o Scientific management advised paying good wages and good working conditions
Federal Policies:
o The government kept some of the wartime subsidies to farmers in place and also
cut taxes for businesses to encourage ‘buying American’.
Hire Purchase and Loans:
o More people bought homes and farms on mortgages that banks lent.
o Between 1920 and 1929, consumer debt rose from $3.3 billion to $7.6 billion.
o People were also borrowing more about 10% of their income.
Changing Industry:
o Used higher levels of mechanisation
o Many ran on electricity
o In 1917, there were 7,899,000 homes and businesses wired for electricity: in
1930, 24,555,732
The Stock Market
Bust
Demand began to fall
Companies did not cut production enough, so goods piled up in warehouses
By 1927, unemployment was rising, employers cut waged and working hours
Businesses and banks were in debt and stock market overheated
Stock prices began to fall
, Banks that gambled with customers’ money went bankrupt
The Great Depression
Wall Street Crash significantly worsened the depression
Businesses and banks went bankrupt, unemployment shot up
People lost their homes if they could not afford mortgages
Homelessness and poverty increased
Hoover tried to push federal action, but most Republican Congress was unwilling to
agree
o Hoover lost the election to Roosevelt and his New Deal promises
Recovery
Roosevelt closed the banks
FED officials inspected the banks and reopened the healthy ones
Created jobs and helped those with loans
Droughts made the Great Plains a dust bowl
o Many farmers lost their farms and became migrant workers
Roosevelt ran up huge government debts funding the New Deal
The Federal Housing Administration oversaw slum clearance and the building of
housing for low-income families
The Second Agricultural Adjustment Act provided subsides for farmers to produce
less
Recovery was not certain
o There were still more unemployed and homeless people
Roosevelt moved to war production to help the Allies
o The USA joined the war in 1941
Which had an effect on creating jobs in factories and the military
