USA (1920-1945) Economy Flashcards
How did Laissez faire cause the 1920s boom?
Allows business to prosper and gain higher profits - few regulations and high tariffs (e.g. Fordney McCumber Tariff Act 1922 - raises taxes to highest ever level)
How did Rugged Individualism cause the 1920s boom?
Promoted by republican presidents - people achieved their own success
How did technological changes cause the 1920s boom?
Introduced electricity, refrigerators, conveyor belt. New building materials e.g. concrete mixers and new plastics like Bakelite, transforms cities with skyscrapers
How did credit cause 1920s economic boom?
Became more available - by 1929 $7 billion worth of goods had been bought on credit
How did wages increasing cause economic boom of the 1920s?
Increased between 1923 and 1929, the average wage increased by 8%
How did the car industry cause the 1920s boom?
It grew, knock on effect to other industries: road building, steel, rubber
How often could a car be produced in1913 compared to 1920?
3 minutes to every 10 seconds
How many cars were on the road by the end of the 20s?
4.5 million
How did the stock market boom cause the 1920s boom?
Share prices rose, so more were willing to invest, pushing them even higher
How many shares were sold in 1926 compared to 1929?
451 million to 1.1 billion
How did falling demand for consumer goods cause the Wall Street Crash?
By 1929 most who could afford a car had one, 60% of American families lived below the poverty line and had an income of less than $2000 a year (the boom didn’t impact everyone)
How did WW1 cause the Wall Street Crash?
It had helped farming, but afterwards the demand fell - price of wheat dropped from $2.5 to $1 a bushel
By 1928 how many farmers lived in poverty?
Half
Which old industries went into decline causing the Wall Street Crash?
Demand for coal fell as electricity and gas were more widely used
How did lowered tariffs cause the Wall Street Crash?
The cotton industry suffered from foreign competition
How was banking not regulated well causing the Wall Street Crash?
In the 20s there were over 30,000 banks
How did shares cause the Wall Street Crash?
They did not rise as quickly in 1928 as companies were not selling many goods
How did artificially high prices cause the Wall Street Crash?
By 1929 75% of the purchase price of shares was borrowed
After the crash how much did unemployment increase by?
3.2% in 1929 to 25.2% in 1933
How much greater was unemployment for African Americans and women?
4 to 6 times greater for African Americans and it was higher for women too
In 1932 how many people were homeless?
2 million
What did weather problems in the countryside cause and what was an example?
Dust bowl - caused 1 million people to leave their homes in search of work in the city
How many Americans were unemployed in 1933 compared to 1939
18 million to 9 million
When did unemployment cease to exist?
1942
What was Roosevelt’s Recession 1937?
He reduced government spending showing the need for government money and caused 66% of gains from the New Deal to be wiped out
How many tanks and rifles did the US produce for WW2?
86,000 tanks and 15 million rifles
Following WW2 how much did farm income increase by?
250%
How much did US debt increase by from from 1941-45?
$41 billion to $260 billion (funded through war bonds, Roosevelt increased taxes for higher earners)
