9A: the boom

• Factors behind the boom (5)

  1) WW1

  2) industrial strength

  3) Republican Policies

  4) new industry + methods

  5) mass production
• How did the First World War benefit the Boom?


  * Lent money and sold food to the Allies

  * Sold arms and munitions to Britain and France (one way trade)

  * The USA joined the war in 1917 so not much damage was done economically.
• How did Resources benefit the Boom?


  * The USA had big steel, coal and textiles industries.

  * It was a leading oil producer.

  * These materials could be exploited to produce steel, chemicals, glass and machinery.

  * The USA led the world in most areas of industry.
• how much steel was produced 1922 america vs all of europe


  america - 60 million tonnes

  europe - 10 million tonnes
• How did Industrial Strength benefit the Boom?


  * The majority of the population worked in industry.

  * Most US companies didn't need to export goods so didn't need to pay tariffs.

  * They had accesss to all of the raw materials that they needed inside the USA.

  *lots of natural resources -> leading oil, coal, steel and textiles industries in 1920s
• How did Laissez-faire benefit the Boom?


  * They believed the government should interfere as little as possilble with ordinary people's lives.

  * The republicans left businesses alone to do their job.

  * Similar to 'rugged individualism' - Americans were strong and could solve their own problems.
• How did Tariffs benefit the Boom?

  * Import tariffs made it expensive to import foreign goods.

  * This protected businesses from foreign competition.

  * This allowed American companies to grow more rapidly.
• What was the Fordney-McCumber Tariff?


  * Harding introduced it in 1922.

  * It made imported food expesnive.
• How did Low Taxation benefit the Boom?


  * The Republicans kept taxes as low as possible.

  * This benefitted ordinary people as they had more disposable income.

  * Also benefitted the rich, who reinvested in industries.

  * They thought that if people kept their own money, they would spend it on US goods.
• How did Trusts benefit the Boom?


  * Trusts were huge supercorporations which dominated industry.

  * The Republicans allowed trusts to do what they wanted.

  * They believed the 'captains of industry' knew better than politicians.
• What are two examples of Trusts?

  * Carnegie (steel)

  * Rockefeller (oil)
• How did New Industries and New Methods benefit the Boom?


  * New industries caused a boom in consumer goods.

  * Mass production meant that goods were cheaper.

  * Luxury items became more accessible.
• What are examples of products which were massed produced?


  * Telephones

  * Radios

  * Vacuumn cleaners

  * Washing machines
• What was the incrase in silk stockings?

  In 1920, 12,000 pairs of silk stockings were sold, in 1930, 300 million paris of stockings were sold.
• What new material revolutionsed clothing?

  Rayon; it was a cheaper substitute to silk.
• What was the Assembly Line?


  * Each work had 1 or 2 small jobs to do as the object moved past them.

  * This made it quicker to produce a product so more were made, making the product cheaper.
• when was the assembly line created


  1913
• In 1927, how frequently did a car come off the Assembly Line?


  In 1927, one car came off the assembly line very 10 seconds.
• What was the incease in cars from 1900-1929?


  In 1900, 4,000 cars were made; by 1929, 4.8 million cars were made.
• How many cars were produced?


  Between 1908 and 1925, more than 15 million cars were produced.
• What were the consequences of the Ford Model T car?


  * The glass, leather, steel and rubber industries all benefitted.

  * More jobs were created as roads needed to be built.

  * New businesses like petrol stations, billboards, motels and service stations emerged.
• how much did the car cost

  only 3 months of workers wages
• how much of working population of america employed in automobile industry


  25%
• how did texas benefit from cars

  *by the end of 1920s american cars used 7 billion gallons of petrol a year

  *this created jobs in the oil industry and made texas rich
• what ran homes in 1929 + what was used before


  electricity - had been fossil fuels before
• what did the boom do for infrastructure + urbanization


  *more roads and real estate were built

  * more phone lines connected

  *cities grew and suburbs became staple of american society
• what did boom do for financial sector


  *banks had more money to spare so gave out more loans

  *they also invested in stock market

  *optimistic state of mind meant more risks taken so stocks rose a lot
• why were people able to buy more stuff

  they had expendable income
• how did mass consumption help the boom


  *many advertisers who learned the skills of propaganda during ww1 now applied it to their own industries

  *huge growth in mail-order copmanies (people buying goods from catalogues shipped ot house)
• What new schemes were introduced?

  'Buy now, pay later' and hire purchase.
• What fraction of radios and cars were bought on credit?


  8/10 of radios and 6/10 of cars were bought on credit.
• How did State of Mind benefit the Boom?


  * During WW1, 'thrift' was seen as a good quality.

  * After the economy improved, confidence increased so more was spent on consumer goods and entertainment.

  * Consumers bought more on credit and borrowed money to buy shares.

  * There was huge confidence in the stock market.
• What was the increase in shares?


  From 1920 to 1929, stocks in major companies quadrupled in value.
• What was the decrease in US farm income from 1919-28?


  Total farm income decreased from $22 billion in 1919 to $13 billion in 1928.
• How did declining exports impact the farming industry?


  * After WW1, Europe imported less food form the USA

  * This is because they were poorer and couldn't afford the tariffs.

  * Europe retaliated with her own tariffs.

  * This caused a reduced market and surplus crops.
• How did new competition impact the farming industry?


  * Canadian and Argentinian wheat producers were more efficient and didn't have high tariffs.

  * In response, farmers lowered their prices.

  * This meant they lost even more profit.
• How did overproduction impact the farming industry?


  * More land was being farmed.

  * Improved machinery like the combine harvester and improved fertilisers made farming extremely efficient.

  * This caused a surplus of crops that no one wanted.
• In 1921, how far did farming prices fall?


  In 1921, prices fell by 50%.
• How did Prohibition impact the farming industry?


  * The alcohol industry was a major consumer of wheat and barley.

  * As allegedly no alcohol was being manufactured during Prohbition, demand fell massively.
• How many Americans lived in rural areas?


  About a half of all Americans.