The rise of US dominance as an economic and industrial power

Question 1

What was the driving force behind behind the spectacular economic growth from 1890 to WW1?

Answer 1

Industrialisation: the massive increases in output and productivity as American industry modernised, and the natural resources of a continental nation were fully exploited.

Question 2

What was industrial growth accompanied by?

Answer 2

A ‘golden age’ of agriculture in the early 20th century, stimulated by new techniques and favourable market conditions.

Question 3

Describe how economic expansion was not trouble free.

Answer 3

There were times when the industrial economy slowed down in between massive surges of growth.

Question 4

What did the suffering of agriculture in the 1890s lead to?

Answer 4

Social unrest and political protest movements.

Question 5

What did banking and finance struggle to keep up with?

Answer 5

The size and complexity of economic growth, and there were major financial crises: especially the Panic of 1893, when the financial crash led to years of a ‘Great Depression’ affecting the wider economy.

Question 6

Describe the Panic of 1907.

Answer 6

A similarly damaging depression to that in 1893, which was only averted by desperate emergency measures organised by business leaders.

Question 7

What did the power and influence of ‘industrial capitalism’ arouse?

Answer 7

Resentment and opposition from farmers, industrial workers and Progressives.

Question 8

What did reaction against big business prompt?

Answer 8

Demands for more effective regulation, and for more government intervention in the economy.

Question 9

What was the situation with US imports and exports in the early 1890s and when did this change?

Answer 9

In the early 1890s, the US was still a net importer (total imports greater than exports). This changed during the ‘Second Industrial Revolution’.

Question 10

What happened between 1895 and 1913?

Answer 10

American economy achieved ‘take-off’ - 2 intense surges in exports.

• Increase of 90% between 1895-1900
• Surge of 77% between 1908-1913

Question 11

What was the USA by 1913?

Answer 11

A net exporter - exports concentrated on iron, steel, copper and oil.

Question 12

Compare the USA to Britain at this point in 1913.

Answer 12

American productivity was better than Britain’s; US export prices were lower. European competitors were alarmed by this spectacular growth - they called it the ‘American Commercial Invasion’

Question 13

What were the 5 causes of the economic boom after 1895?

Answer 13

• Efficiency
• Labour supply
• Rising world demand
• Natural resources
• Excellent transportation network

Question 14

Describe the factor of efficiency.

Answer 14

US industries had higher productivity, through innovation and efficient management methods.

Question 15

Describe the factor of labour supply.

Answer 15

The influx of immigrants reached peak levels.

Question 16

Describe the factor of rising world demand.

Answer 16

There was an inability of European producers to keep pace with it.

Question 17

Describe the factor of natural resources.

Answer 17

One key example was the discovery of high-grade iron ore in the Messabe range of hills in Minnesota in 1892 - by 1907 US Steel had bought up 75% of the Messabe ore.

Question 18

What did American economist Douglas Irwin stated in 2001?

Answer 18

“Resource abundance formed the basis for the US export success around the turn of the century”

Question 19

Describe the factor of transportation.

Answer 19

An excellent transportation network allowed iron ore to move smoothly from Duluth on Lake Superior through the Great Lakes to the steel mills in Ohio and Pennsylvania. Steel production went up by 400% by 1913.

Question 20

What did the developments of huge new oilfields lead to and where were they?

Answer 20

They were in Oklahoma, California and Texas and they expanded the position of the US as the world’s leading oil producer.

Question 21

Describe US oil production by 1910.

Answer 21

By 1910 US oil production equalled to that of the rest of the world combined.

Question 22

What else was there a massive growth in the production and consumption?

Answer 22

Of coal coal and electric power, in shipping and shipbuilding on the West coast, in the construction industry, and in urban transport.

Question 23

Why was the booming economy underpinned by favourable political circumstances?

Answer 23

There was only limited regulation of business, with many governments - both at state and federal level - sympathetic to business interests (in republican dominance 1896-1912)