The USA, 1919-41

The USA, 1919-41

1. The Economic Boom of the 1920s

   • American industry and farming had grown steadily
   • The country had huge resources of coal, oil, timber and iron
   • It had a growing population with hard-working immigrants
   • Railways, mining and manufacturing industries were all strong
   • Americans believed in the Republican views of rugged individualism and laissez-faire
   • US businesses made money from WW1 through loans, arms and equipment - made the USA rich, confident and isolationist - not dragged into EU wars.
   • Republicans in charge: President Harding (1921-3) - believed in normalcy. Key Policies: Isolationism, Tariffs and Low Taxes
   • Mass-production made profits rise enormously. Particularly for consumer goods and motor industry - hire purchase and 'buying on the margin'.

2. American Society in the 1920s

   • First 'talkie' out in 1927 - 'The Jazz Singer' starring Al Jonson. People went to see famous stars like Charlie Chaplin and Rudolph Valentine
   • Hollywood became the centre of world entertainment - there were jazz crazes and people danced the charleston.
     • Watching films became a national obsession - millions went every week.
   • 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)
   • 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.
   • Strong anti-alcohol temperance groups made Gov. pass 18th Amendment (Volstead Act) to ban sale and manufacture of alcohol.
     • Massive failure - led to bootleggers, moonshine, speakeasies, bribed agents and gangsters like Al Capone rising.
       • Al Capone ran Chicago and caused the St. Valentine's Day Massacre in 1929 when 6 members of a rival gang were killed.

3. The Wall Street Crash and the Depression

   • Long-Term Causes
     • Overproduction of consumer goods + agriculture, inequality, foreign competition and foreign tariffs.
   • Short-Term Causes
     • Share speculation, companies forced to pay shareholders profits and Americans buying on credit.
   • September 1929 - share prices started to decrease. Suddenly, everyone realised and started to sell shares. Worst day was 'Black Tuesday' on 29 Oct.
     • Many became bankrupt, homeless (Hoovervilles), lost savings similarly to farmers.
   • 11,000 banks stopped trading from 1929 to 1933.
   • Hoover - said 'prosperity was around the corner'. Set up the Reconstruction Finance Corporation and tried to help US exports but failed.
     • 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.

4. The First New Deal

   • Roosevelt won by approximately 7 million votes to Hoover, through his 'New Deal'
     • In office in March 1933 - many banks closed, industrial production down 56% from 1929's
       • 9 March -> 16 June 1933 - Hundred Days Legislation
   • Emergency Banking Act
     • Gov. declared a bank holiday to shut banks. Opened 8 days later + backed 5,000 banks. Restored confidence.
   • Securities Exchange Act
     • Gov. regulated stock market to prevent another 1929 crash
   • Federal Emergency Relief Act (FERA)
     • $500 million allocated to help the poor (clothing, food, shelter). Seed and equipment for farmers, schemes to create jobs.
   • Tennessee Valley Authority (TVA)
     • 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
   • Civilian Conservation Corps (CCC)
     • Men aged 18-25 given 6 months work but had to sent most of pay home. By 1933, 300,000; by 1940, 2 million
   • Public Works Administration (PWA)
     • Paid for public works projects (schools, roads) and used the unemployed
   • Agricultural Adjustment Act (AAA)
     • Advised farmers on marketing and farming techniques - helped overproduction. Became more organised but wealthy farmers gained most.
   • National Industrial Recovery Act (NIRA)
     • 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.

5. The Second New Deal

   • Tried to make society fairer for all
     • In 1935, the WPA replaced the PWA - extended range of work given. From building work to Federal Theatre Project for unemployed artists and writers.
     • In 1935, the Wagner Act forced employers to recognise trade unions (workers kept protection from NRA)
     • In 1935, the Social Security Act provided federal aid for elderly and unemployment insurance but not as good as UK

6. Successes and Failures of the New Deal

   • Business Leaders unhappy with regulations, trade unions and the huge cost
   • States lost individual powers due to measures like the TVA and were worried of Gov's control
   • 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.
   • 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.
   • Successes
     • The Depression didn't lead to extremism, millions of jobs were created and vital relief supplied, farming and industry benefited from the efficient infrastructure.
   • Failures
     • 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

7. Weaknesses in the US Economy

   • Some major industries like coal and textiles didn't benefit from the 'Boom'
   • Countries reacted to US taxes on imports with their own, reducing demand
   • 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.
   • Many ordinary Americans didn't prosper as wealth was concentrated with very few - African Americans suffered more due to discrimination and worse jobs