1.4 Changing quality of life Flashcards
What were the three factors that caused the Post-War depression?
Farming, Industry and Government action
How did farming contribute to the Post-War depression?
During War and after the war
During the War governments were given subsidies and were making a profit. This led them to take out more loans.
Due to the increased mechanisation many farmers became unemployed also. After the War they produced in surplus which caused prices to fall. They increased production to cover losses.
This caused them to go bankrupt and sack workers.
How did industry contribute to the depression?
Statistic for the decline of a specific industry?
There were many strikes between 1919 and 1920 which caused many businesses to suffer and fail.
Old industries went into decline as they were replaced.
Eg coal was replaced by water and electricity.
In 1900 coal was 90% of all power
In 1930 coal was 60% of all power
How did government reaction contribute to the depression?
The republican government did not try and stop the depression.
They put tariffs on foreign goods which caused other countries to do the same and US exports fell.
-The government thought the depression would right itself and it did.
What were the 5 factors that led to a boom?
Mass production, new management techniques, Federal policies, HP and loans and changing industry.
How did Mass Production lead to the Post War Boom?
the production technique of a moving assembly line allowed firms to produce things more cheaply and faster.
Henry Ford had the first moving assembly line with the model T which decreased costs of production to make cars more affordable.
In 1917 there were 4,272,468 cars
In 1929 there were 23,060,421 cars
How did New Management techniques lead to Post War Boom?
Some Employers like Ford, used scientific management techniques where every worker was specialised in one movement or task, was put forward by Frederick Taylor.
They were trained in the most effective way to complete the increased wages and benefitted working conditions..
How did Hire Purchase and Loans contribute to the Post War Boom?
- Lending became more common and it was not only banks to do it, companies such as Sears pushed HP, and ‘easy payments’
- Between 1920 and 1929 Consumer debt rose from 3.3 million to 7.6 billion, In 1929 debt was 5% of income.
How did changing industry contribute to the boom?
-Newer industries were more efficient and used higher mechanisation. Older industries like textile manufacturing declined.
-They also relied on electricity so when electricity became more available they were able to take off.
In 1917 there were 7,889,000 and in 1930 24,500,732
How did the stock market lead to the post war boom?
How many shares were traded in 1929
-Stock trading had become something that only Banks did, however it became increasingly popular with regular households.
-As share prices were constantly increasing media encouraged people to buy shares (BUYING ON THE MARGIN).
This increased demand for shares sent the market into a bull phase.
-Banks also used used customers’ investments to trade in share
1125 million shares were traded.
How did the collapse of the stock market happen?
- Most people who bought consumer goods had, so this led to a saturation in the market. Firms did not cut production so stock piled up in warehouses.
- The government did not intervene as they thought it would be similar to 1919 and the efforts to tighten the FED to control the boom made the depression worse.
- In September 1929 people sold their shares as they were seen as too high.
- The media started talking of a crash so people panic sold their shares which caused a Bear Market to occur
- 29th October the stock exchange closed.
What was the impact of the stock market crash?
- Small investors lost everything
- Banks gambled people’s savings and went bankrupt and in 1933 1/3 of all banks were bankrupt
How did federal policies contribute to the boom?
-US government kept some wartime subsidies and cut business taxes.
What was the stock market boom?
-Previously it was only financial institutions who bought shares for the long term.
In the 1920s households were egged on by media to buy on the margin, they would purchase shares with loans and this caused a bull market.
-Banks also invested savings into this.
What were the factors that impact the Second World War boom?
-Pent up demand, during the war consumers could get less so they consumed more.
In 1945 production increased from 213 billion dollars
to 284 billion dollars in 1950.
-Strikes and protests, When Railway workers and miners went on strike he took over both industries. When Coal miners held up 25,000 trucks he brought in the army.
-Baby boom.increased demand for child centred goods. In 1953 toy firms made 1.6 billion.
1961 made profits of 2 billion.
-Farmers kept war time subsidies and increased spending on food.
-Government increased fiscal spending through the time period under Trumans ‘Fair Deal Policies’
Introduced education and training through the GI bill (for 12 million).
-1949 National Housing Act introduced slum clearance and building of 810,000 low-income housing units to replace slums.
What was the impact of the SWW boom on inflation and affluence.
- The boom was inflationary
- Truman passed 1946 employment act with a goal to reach full employment, with advisors on inflation.
- The OPA that kept prices low during the war made prices to jump 25% as farmers could exploit.
- The government tightened money supply.
What were the positive and negative aspects of the 1950s economy?
-The boom of 1950s and 1960s increased confidence into consumerism and consumerism was seen as the American way.
However, there were times in 1950s where unemployment and inflation shot up.
Also, growth of the suburbs made inner cities slum ridden.
What was the growth of the suburbs?
- Factories and Universities started to be built in suburbs.
- 1956 highways act allowed for 41,000 of highway to be built.
-Levitt towns were created in suburbs which were prefabricated towns.
Example on long island with 17,000 homes and 82,000 inhabitants cheapest house 7,000 dollars.
HOWEVER, did not sell to black Americans.
What were the changes and shifts to the US economy?
- America lost its hold on technological markets. America created the first transistor radio and failed to innovate. it and Japan did. America had to buy parts from Japan. In 1945 there were 58 million of these radios.
- Production moved from North and West to South and East, for military and air production. After the war these produced peacetime goods. (area called the sunbelt).
- The government tried to decreased spending and keep interest rates and the money supply low. In 1952 there was 169.7 billion in circulation and 215.8 billion in 1960.
What happened in the 1960s?
- The government lost its position as biggest exporter
- Gov increased the money supply to keep up with welfare payments.
- The gold and paper money balance was increasingly out of balance.
- In 1966 the government slowed the money supply and there was both a downturn and decrease in inflation.
- It increased the money supply slowing inflation but creating problems for the gap with US gold reserves.
