The Economy in the 1950s and the Consumer Society (1952-1960)

Question 1

What was the state of the economy in the 1950s?

Answer 1

• The GDP was $355bn in 1950 but rose to $488bn in 1960
• Income per capita rose from $1720 in 1940 to $2699 in 1960
• The economy grew by 37% during the 1950s
• The slow recovery of European rivals meant that the US was the main supplier of manufactured goods worldwide

Question 2

What was the growth period in the 1950s known as?

Answer 2

The Eisenhower Boom

Question 3

What were the reason for economic growth?

Answer 3

• Government spending on the GI Bill
• The maturing of war bonds (maturing of bonds = the period during which its owner will receive interest payments on the investment)
• Government spending on the military sector ($40bn annually)

Question 4

How did media and advertising lead to economic growth?

Answer 4

• The purchasing desires of new consumers were driven by an increase in advertising (increased from $6bn annually in 1950 to over $13bn by 1963)
• Politicians also began to use advertising in their campaigns (like Eisenhower answers America)

Question 5

What was Eisenhower Answers America?

Answer 5

Ike’s televised campaign which followed him him answering questions for ordinary people, consequently increasing his popularity and presenting him as down to earth

Question 6

How the availability of credit lead to economic growth?

Answer 6

US consumers were interested in cheap credit which came through the Federal Housing Administration and the Veterans Administration that provided loans with low interest rates

Question 7

What did the building boom in the US lead to?

Answer 7

• An increase in suburbs such as Levittown in New York
• Cheap mass production of housing for 80,000 Americans for $8000 per home
• African Americans couldn’t buy houses in Levittown

Question 8

What credit cards were introduced in the 1950s?

Answer 8

• The first credit card was launched by the Diner Club in 1950
• The American Express was introduced in 1958

Question 9

What was the impact of the baby boom?

Answer 9

• Added millions to the US population between 1946-1959
• Created a new market
• Teenagers were described as a ‘$10bn power’ by life magazine in 1959

Question 10

What was the impact of ‘consumer society’ on America?

Answer 10

By 1960, the US owned nearly half of all the world’s cars and phones, and 90% of US families had a TV

Question 11

What was the Kitchen Debate?

Answer 11

• In 1959, Khrushchev and Nixon had a ‘Kitchen Debate’ about the pros of American capitalism compared to communism

Question 12

When did Khrushchev take a tour of the US, why, and what was the effect on him?

Answer 12

• In September 1959, Ike had Khrushchev take a tour around the US to see the benefits of capitalism first hand
• It prompted Khrushchev to try and increase the production of USSR consumer goods

Question 13

How did entertainment and leisure increase in the 1950s?

Answer 13

• Live sport and music increased the popularity of TVs (at the expense of cinemas which saw a decline that lasted until the mid-1980s)
• Disney grew in popularity and established a theme park in California in 1955
• Southdale Center, the first indoor shopping mall, opened in 1956 in Minnesota with access to 72 stores and 5200 parking spaces
• The growth of town centers also prompted the growth of fast food restaurants like Maccies and Burger King (1954)

Question 14

What is homogenisation?

Answer 14

The process of making things uniform or similar. Examples would be housing in the US or Disney

Question 15

What were some popular shows and who were some famous singers in the 1950s?

Answer 15

• ‘I Like Lucy’
• Elvis Presley
• Bob Dylan

Question 16

What were some limitations of the consumer boom?

Answer 16

• 1/4 of Americans still lived in poverty (income of under $3000 for a family of 4). Michael Harrington exposed this in his book ‘The Other America’
• There were 2 recessions (1954 and 1958 (which reduced production by 14%))
• The American Dream was still unattainable for some due to women losing jobs after the war and racist employment practices