3 The Impact of Economic Change on Society

Question 1

World War Two

By the 1960s economic trends in the United States (industry + war)
- what happened to government debt as a result of what

Answer 1

By the 1960s, the US manufacturing industries were in decline,
- the expense of the vietnam war and the Great Society raised the govs deficit from $1.6b in 1965 to $25.3b-1968
- leading to inflation and a weak dollar

Question 2

2 The Impact of Economic Change on Society

1973… other countries competing against the USA? what was the american economy suffering from? what was the effect of the American people?

Answer 2

• other countries seemed as though they could overtake the USA as the world’s leading economic power
• American economy suffered from inflation, balance of trade deficit, and a weakened currency
• many americans now struggled to afford consumer goods and oil

Question 3

The Effects of Inflation

What was the effect of inflation? 1978 poll>

Answer 3

• made everything more expensive (mortgages, loans, energy)
• 1978 poll showed 63% of Americans considered inflation their greatest concern

Question 4

The Effects of Inflation

how much did inflaiton increase from 1963 vs 1980

Answer 4

1963: 1.24%
1980: 13.8%

Question 5

The Effects of Inflation

cost of living rose at a yearly average of what..?

between 1973-1983

Answer 5

8.2%

Question 6

The Effects of Inflation

who was the hardest hit?

Answer 6

• those who lived on the Rust Belt (declining manufacturing output)
• increased unemployment in these areas too

Question 7

Unemployment and service jobs

unemployment 1974-1975

Answer 7

• 6.5% in Dec 1974
• 8.9% in May 1975

Question 8

Unemployment and service jobs

what was the increase in unemployment due to?

2 main factors

Answer 8

1. other countries producing cheaper and better goods
2. increasing mechanisation in American industry

decrease in employment opportunities in occupations such as car manufacturing in Detroit

Question 9

Unemployment and service jobs

increase in service jobs

1970-1980

drawbacks?

Answer 9

1970: service jobs 60% of employment opportunities
1980: 70%
- they were low paid, minimum wage ($3.35p/h in 1981) failed to keep pace with rising prices

Question 10

Poverty and homelessness

% of people living below the poverty line 1974-1976 (inc which minority group)

Answer 10

• 11.2% in 1974 to 12.5% in 1976
• included 50% black female heads of households.

Question 10

Poverty and homelessness

food stamp programme grew 1976-1980

Answer 10

• 18.5m in 1976
• 20m in 1980

Question 11

Poverty and homelessness

homlessness in politics

+++ estimates of no. of homless people?

Answer 11

• by the ealy 1980s politicians/press recognised the USA was in a homlessness crisis
• estimates vary in 1980 from 200,000-1m

Question 12

rPoverty and homelessness

reasons for homlessness

hiint: mental illness

Answer 12

• during mid 1970s number of institutions for the mentally ill decreased.
• because the American Association for the Abolition of Involuntary Mental Hospitalization campaigned for greater personal freedom
• these institutions also increasingly struggled for financial survival

Question 13

Poverty and homelessness

1973 Federal District Court rule

mental health

Answer 13

• mental health institutions had to be paid for their labour
• but, unpaid labour helped keep these institutions running
• cons wanted to decrease spending on these institutions, so many closed.

Question 14

Poverty and homelessness

reasons for homelessness

urban renewal policies

Answer 14

• many inner city ‘skid row’ hotels that had housed the exceptionally poor were demolished
• those who lived here struggled to find alternative accomodation

Question 15

Poverty and homelessness

reasons for increased homlessness

jobs

Answer 15

• unemployment
• led to depression, despair, and life on the streets
• budget cuts and lower welfare bennys :(((

Question 16

Poverty and homelessness

reasons for increasing homelessness

females

Answer 16

• declining marriage rates and a lack of support from a partner
• the authorities were unsympathetic
• many women gave up and lived on the streets

Question 17

Poverty and homelessness

reasons for increase in homlessness

drugs

Answer 17

• cocaine in the inner cities meant addicts spent all their money on drugs
• were unable to afford regular living accommodation

Question 18

the oil crisis adn the end of cheap energy

US and energy sufficiency-deficit

americans consumption of oil? from where?

Answer 18

• 6% of the worlds population, but 1/3 of the worlds oil production
• 30% of the oil Americans used had to be imported mostly from the middle east

Question 19

the oil crisis adn the end of cheap energy

what caused the oil crisis? what was the % rise in oil prices? what did it do to the American economy?

Answer 19

• Nixon’s support of Israel in the Yom Kippur War 1973 led to an Organisation of Petroleum Exporting Countries (OPEC) oil embargo on the US
• this followed by a 387% rise in oil prices
• americans now paid 30% more for heating oil/petrol

Question 20

the oil crisis and the end of cheap energy

dramatic events illustrating the seriousness of the energy crisis during the decade

1976-1977 season forced what..

Answer 20

• harsh winter
• gas shortage
• forced closure of schools, factories
• fuel stations closed on sundays or cut their hours to sonserve supplies

Question 20

the oil crisis adn the end of cheap energy

dramatic events illustrating the seriousness of the energy crisis during the decade

1974 strike

Answer 20

• 100,000 independent truckers demanded lower fuel prices brought the nations roads to a standstill for 11 days and stores with empty shelves

Question 21

the oil crisis and the end of cheap energy

dramatic events illustrating the seriousness of the energy crisis during the decade

riot???????????

Answer 21

• Levittown Pennsylvania
• truckers barricaded expressways
• 100 were injured and 170 arrested
• 2 nights of violence

Question 22

the oil crisis + end of cheap energy

dramatic events illustrating the seriousness of the energy crisis during the decade

1977 miners

Answer 22

• late 1977
• 165,000 United Mine Workers began a 3 month strike
• consequent coal shortage led to school closures
• shortened working weeks

Question 23

# the oil crisis + end of cheap energy dramatic events illustrating the seriousness of the energy crisis during the decade | **1976** petrol stations

Answer 23

- half the nation's petrol stations were without fuel - those that had it were charging 50% more than the year before - drivers queued for petrol on specified days

Question 24

# significance of energy crisis effect of rising oil prices on society

Answer 24

- 1/3 of alarming rise in prices due to oil crisis - cheap oil had been vital to post-ww2 prosperity and growth - helped industry and accelerated socially transformative suburbanisation

Question 25

# significance of energy crisis politicans behaviour

Answer 25

- voters wanted them to 'do somethign about it' - raise taxes on oil? not a good idea coz people disliked increased energy prices - inability of politicians to solve contributed to growing political dillusionment

Question 26

# significance of energy crisis **From 1973**

Answer 26

- citizens tried to save fuel through everyday tasks - **1977**: Carter suggested thermostats be adjusted so heating was a maximum of 18 degrees C in the winter, and air con would only kick in at 26 degrees C in the summer

Question 27

# the impact of foreign competition foriegn manufacturing vs American manufacturing

Answer 27

- americans still produced 25% of the world's manufactured goods in the **1970s** - Germany and Japan technologically superior - foreign competition meant increased unemployment and a trade deficit

Question 28

# the impact of foreign competition US trade deficit **1978-1979**

Answer 28

- $40b

Question 29

# the impact of foreign competition Japan and the automobile market | +++ WHY? difference between american and japanese cars

Answer 29

- Japanese companies had **23%** of the US automobile market by **1981** - American car companies slow to adapt - American car companies used lots of oil, whereas Japanese cars were smaller + more economic

Question 30

# the impact of foreign competition number of permanent jobs in the automobile industry falling

Answer 30

**940,000 in 1978 to 500,000 in 1982** - in the car manufacturing city of Detroit, unemployment reached 24% by **1980**

Question 31

# the impact of foreign competition americans reaction to forieign competition

Answer 31

- some attacked Toyotas with sledgehammers - some sported '*Buy American: the job you save may be your own'* - bumper stickers - did not work

Question 32

# the response of the government what were Ford's solutions to improving the economy?

Answer 32

- americans should voluntarily cut their mileage by 5% and stop throwing out food - distributed red and white WIN (whip inflation now) buttons - Americans reejcted his suggestions

Question 33

# the response of the government what did Ford actually do with congress in the long run? | + certain act

Answer 33

- cut federal spending and asked Congress to approve a tax rise - since this was unpopular, he proposed a tax cut, which the Democrat controlled Congress made larger than he thought wise - the Tax Cut and **1975** Omnibus Energy Act helped bring the economy out of recession

Question 34

# the response of the government What were Carters responses to rocketing inflation?

Answer 34

- decreased government spending by freezing federal workers' wages - urging voluntary wage and price controls in the private sector

Question 35

# the response of the government americans response to Carters economic policies | blue collar workers, the buisiness community ## Footnote counterpoint w FRB

Answer 35

- **blue collar workers**: disliked his focus on inflation rather than unemployment + his criticism of striking miners in **1977** - **Buisiness community**: feared his energy proposals would damage industry was he unfairly judged? - Carter's support for his **Federal Reserve Board** chairman's tough stance on inflation led to revival under Reagan

Question 36

# Carter and the energy crisis what did Carter's energy programme suggest? | think ab everyday life + in the home

Answer 36

1. **Oil conservation**: through cutting down on travel 2. **alternative power**: nuclear, coal, solar 3. **higher taxes** on large automobiles 4. **greater insulation**

Question 37

# Carter and the energy crisis why did Carter's proposed legislation meet lots of opposition in the senate?

Answer 37

- carter had insufficient **consultation** - **states were opposed** where oil was produced - **voters did not want to pay higher taxes**

Question 38

# Carter and the energy crisis per capita consumption of energy

Answer 38

- decreased by 10% between **1979-1983**

Question 38

# Carter and the energy crisis **Energy Security Act 1980**

Answer 38

- offered loans and incentives to promote the search for and use of alternative energy - including synthetic fuels, alcohol fuels, biomass energy - But: **carters suggestion that nuclear power was one route to US energy independence** was unpopular after a nuclear meltdown at Pennsylvania's three mile island reactor in **1979** which mobilised environmentalists, nationwide protests took palce demanding the shutdown of nuclear facilities.