Unit 1.4 - Changing Quality of Life Flashcards
What happened to the American economy shortly after WW1?
- The USA entered a brief Depression.
What stopped in America after WW1?
- War production.
- Manufacturing and producing crops for Europe & America.
What was the impact of the Post War Depression on farming?
- During the war farmers were encouraged to produce more wheat.
- Some farmers took out loans to buy more machinery resulting in unemployed workers.
- Due to the overproduction of wheat during the war, after the war they produced too much and prices fell.
- Farmers growing cotton still faced plight due to the boll weevil.
What was the impact of the Post War Depression on industry?
- Many strikes in 1919&1920.
- Most of which failed to achieve the strikers terms causing businesses to fail and increasing unemployment.
- Many older industries within the North and East were already in decline. (Coal production for energy dropped to 60% by 1930.)
What was the Government reaction to the Post War Depression?
- Republican government didn’t intervene due to Laissez-faire policies.
- Isolationist Tariffs placed on foreign goods caused other countries to do the same leading top a drop in US exports.
- The Government believed that the Depression would right itself, which it did. Impacting their reaction to the 1929 Depression.
What 6 factors contributed to the Post-War Boom?
- Mass Production.
- New management techniques.
- Federal policies.
- Hire and purchase loans.
- Changing Industry.
- The Stock market.
How did mass production contribute to the Post-War Boom?
- Broke down manufacturing into a series of steps.
- Mass-produced goods were produced quicker and cheaper, so they could be sold at a lower price.
- This made then more affordable so manufacturers sold more, and consumers bought more.
How did new management techniques contribute to the Post-War Boom?
- Some employers began adopting ‘scientific management’ ideas (Set out by Frederick W. Taylor).
- Made the production line worker as efficient as the production line itself.
- Each worker was trained in the most efficient way to carry out their task.
- The system worked best when the workers stayed at the factory so good wages, working conditions and benefits were advised.
How did Federal Polices contribute to the Post-War Boom?
- Generally avoided intervention in businesses.
- Kept some wartime subsidies to farmers in place.
- Cut taxes for businesses to encourage ‘buying America’.
How did hire and purchase loans contribute to the Post-War Boom?
- Before the war borrowing was seen as a last resort, that wonky banks and loan companies could administer.
- In the 1920’s companies pushed hire purchase (paying the company for goods in instalments.) as the practical way to buy.
How did the changing industry contribute to the Post-War Boom?
- New industries were more efficient and used a higher level of mechanisation.
- Older industries became less important than newer industries that manufactured consumer goods.
- Many new industries and the goods they produced ran on electricity, meaning that the Boom couldn’t really take off until the electricity grid was reaching a significant amount of homes and businesses.
How did the Stock Market contribute to the Post-War Boom?
- In the 1920s prices of shares in new industries rose rapidly.
- Share trading had previously been something that only banks and wealthy people did.
- Media coverage encouraged normal people to invest in the stock market eventually causing a Bull Market.
- People began to borrow money in order to buy their shares.
- Banks began using their customers investments to trade in shares.
- The government did nothing to stop this.
How much did consumer debt rise between the years 1920 & 1929?
- Consumer debt rose from $3.3 billion to $7.6 billion.
What were the warning signs that the Boom was over?
- Most people who could afford consumer goods already had them so demand decreased.
- Companies did not cut production enough so goods piled up in warehouses.
- By 1927, unemployment was rising and consequently employers cut wages and hours.
What did the government do to help the failing economy in the lates 1920s?
- The government did nothing as they were still firm believers in Laissez-faire policies.
- They believed that like during the Post-war Depression, the economy would eventually right itself.
