Inequalities of Wealth in the 1920s

Question 1

Inequalities of wealth - facts + figures

Answer 1

The richest 5% earned 33% of all the money
There were an estimated 15,000 US millionaires in 1927, while 42% of families had an income of less than $1000 a year, so couldn’t buy necessities like food and housing

Question 2

Why was there poverty in the countryside?

Answer 2

By the early 1920s, farmers were only earning a third of what they had earned in 1920.

• after WW1, there was less demand in Europe for American imports
• some countries taxed US imports, making them expensive and difficult to sell overseas
• high-tech farming machinery produced a surplus of food, which meant prices fell
• some farmers had borrowed money from banks to buy the new machinery but now couldn’t pay back the loans, so they were evicted
• around 600,000 farmers lost their farms in 1924 alone (the farm workers also lost their jobs)

Question 3

Why were there problems in traditional industries?

Answer 3

• coal miners suffered because coal mines closed due to new forms of power (oil, gas, electricity) becoming more commonly used
• cotton and wool factory workers suffered as there was less demand for their products due to new man-made fibres like rayon and the fashion for shorter dresses (requiring less material). Many factories shut down

Question 4

Why did African American workers suffer?

Answer 4

• many worked on farms as labourers or were sharecroppers who rented small areas of farmland from a landowner.
• as the farming industry suffered in general, African American farmworkers and sharecroppers were hit particularly hard because they were already desperately poor
• many moved to cities to work but could often only find low-paid jobs

Question 5

Why did American Indians suffer?

Answer 5

• large amounts of their land had been seized by mining companies and much of their traditional way of life had been lost
• many native Americans had been forced to move to reservations where the soil was poor so it was hard to grow crops properly
• most native Americans lived in extreme poverty, were poorly educated and had a lower life expectancy than other groups in US society