1a: 1920s Econ boom - Reasons for Prosperity Flashcards
What did many companies begin to adopt?
Mass production strategies.
This was enabled by the more efficient assembly line method.
How did govt policies encourage business to develop?
They applied few regulations and slashed taxes, enabling growth.
What are the 5 main factors that created the prosperity?
- Govt policies.
- Tech advances
- New business methods
- Easy Credit
- Advantageous Foreign markets.
Which political party dominated the 1920s?
The Republican party.
Who were the three Republican Presidents?
Warren Harding (1921-1923) Calvin Coolidge (1923-1929) Herbert Hoover (1929-1933)
What did the Republicans believe in?
Little govt involvement in the economy.
Took a laissez-faire approach: the market could operate with minimal restrictions.
What did Treasury Secretary, Andrew Mellon (1921-1932), say about wealth?
Mellon believed wealth filtered down the social strata so the best way to improve living standards was to let the rich amass great wealth.
What was the Fordney-McCumber Tariff of 1922?
Tax on imports to the USA - cover the difference between domestic and foreign production costs.
Made domestic goods cheaper.
Tariff so high on some goods that domestic producers were given a guaranteed market.
What was a negative of the Fordney-McCumber Act?
It limited foreign trade.
What happened to taxes in the 1920s?
Federal taxes were reduced in 1924, 1926, 1928.
This benefited the wealthy.
Mellon handed out tax reductions ($3.5 billion) to large corps.
What did fewer regulations mean?
Give example
Exploitation and price fixing.
Child labour in Southern textile mills.
- 56-hour-week on 18 cents an hour.
Who initially introduced the assembly line method?
Henry Ford in 1913.
By 1924, how much of the motor vehicle industry did Ford own?
50%.
What made assembly lines possible?
The introduction of electricity.
What was a negative human consequence of the assembly line?
The work was repetitive and dull - it turned human into automata.
