How far did the American economy “boom” in the 1920’s Essay
After the First World War America became richer and their economy flourished due to demand during and after the war, which brought America into what was called the ‘Roaring 20’s’. Their GNP grew from $78 billion to $103 billion between 1919 and 1920. The “boom” was the product of new attitudes and ideas in America.
With their newfound confidence America was more willing to invest in new products and take risks. This meant the revolution of new technologies. Mass production techniques were discovered which influenced the motor business making a tremendous impact on economy.It employed thousands of people and stimulated the growth in other industries such as metal, glass and rubber. However, in 1929 the depression hit the USA.
Due to encouragement of taking out credits, loans and shares companies became bankrupt which left Americans in debt and unemployed. By 1920, America was the largest Industrial power. Big Businesses were ‘booming’, there was a high consumer demand and there were new technological advances. These were key points to the economic boom, which linked other influences, such as the progression of mass production, to the contribution and prosperity of the ‘boom’.
The development of the motor- car gave thousands of people employment and also stimulated the growth of other businesses. This led to people ‘commuting’ into the cities as people benefiting from the economy could afford new cars and bigger houses in the suburbs. Mass production also meant that as things were made more cheaply it was cheaper for ordinary Americans to buy. Taxes were lowered which gave people more money to spend.
With ever increasing advertisements for new electrical goods people were more influenced to spend the extra money they had.Credits and loans were then introduced which meant people didn’t have to pay straight away for their goods. This shows that businesses were doing well. American Industry was a good indicator to the enormity of the economical “boom” in America. With the “boom” came new technological advances such as the radio.
In 1920, the USA’s first radio station was established (Station KDKA). By 1930 40 per cent of all homes in America had a radio set. The radio gave Americans access to new types of music and it gave sporting personalities (particularly baseball stars) a national figure status.The most well-known and favoured industry was the filmmaking industry. By the early 1920’s Hollywood was known as the world’s film capital.
With the glamour of films Americans were partying more with their excess money. This meant going to Jazz clubs and halls. Dances were fast such as the Charleston. The new interest in Jazz gave more Black people the opportunity to an escape against discrimination. The successful economy gave people more time and money for leisure. However, the good economy didn’t benefit everybody.
Due to the advancement in agricultural machinery many labourers (often Black) and sharecroppers lost their jobs. (Three-quarters of a million lost their jobs during the 1920’s) Many went north into the cities to seek new jobs. However, industries such as car industries only hired a small amount of blacks and many industries had enforced an all-white policy. Most black women could only get low-paid jobs as servants in white households. Thirty million people in America earned their living through farming and between 1920 and 1930 the number of farms declined.This was because of low crop prices (which benefited large companies and American consumers) as too much food was being produced.
Poor earnings meant farmers could not keep up with high rent and big mortgages, which left many farming families in unhygienic conditions of squalor and poverty. These are examples of how the economy though “booming” in some prospects affected the lives of people lower down on the financial ladder. Every year over a million people immigrated to America. Many came seeking prosperity and wealth associated with the ‘American Dream’.However, the reality was very different.
Immigrants were seen as a supply of cheap labour as there were so many of them desperate for employment. This meant their wages were very poor. This also meant some people were very cold towards new immigrants as they thought they were taking all the employment. However, the unemployment rate of new immigrants remained high throughout the decade. The cotton, coal, tin and copper industries suffered as over production meant prices dropped therefore leading to a drop in wages. Many mines closed as oil was in higher demand.
Presidents Harding (1921-3) and Coolidge (1923-9) imposed high import tariffs, which kept out foreign competition. Although this benefited the American economy at first it later became a problem. Foreign countries retaliated by making American products more expensive. This meant when America was over producing they had trouble selling it to other countries. Businesses started to become bankrupt, people were losing jobs and 60% of the population was only just living above the poverty line.
People tried to find ways to blame people. The Dearborn Independent’ an anti-Semitic Michigan paper blamed the Jewish population in America as the economy failed. They said they were trying “to control the world, not by territorial acquisition, not by military aggression, not by governmental subjection, but by control of the machinery of commerce and exchange. ” The depression flared up already anti-Semitic views. America’s economy “boomed” especially for large corporate businesses and comfortable living Americans. It gave people more freedom due to new technologies, more luxuries due to mass production and more leisure time.
As taxes were lowered and gave more people money to spend, it meant there was a higher demand in products, which made companies richer therefore giving them the advantage to give out credits meaning people could buy things they could not afford. However, the economic “boom” did not benefit everyone. Farmers, blacks, working class men and new immigrants often had to face the consequences of the cheaper prices and over producing. Cheaper prices meant cheaper labour, which meant labourers were not being paid enough.
Crop prices were cheaper as they were being over produced, which meant farmers could not pay their rent or mortgages which gave them poorer living conditions and they could not pay their labourers who then had to find new jobs. America’s “boom” was big if short, and it benefited many. However, it was short-lived and even when at its peak it still did not benefit everybody. So in conclusion, I can draw that America’s “boom” went quite far as many businesses and Americans prospered from it but it did have bad consequences, which made it hard for those in poverty and worse when the depression came.