HST 122 Test 2 McIntyre

What is a consumer society?

Consumer goods industries are dominant in economy

Consumption shapes individuals identities

-people identify more with what they buy than what they make
-shopping becomes a source of pleasure

1920's

were a critical decade in transition to a consumer society

The consumer society was made possible by:

-new methods of mass production
-new methods of selling products

2nd Industrial Revolution

-Rise of consumer durable industries
- Changes in production
-need for increased consumption

Rise of consumer durable industries

-automobiles
-electrical products
-phonographs

changes in production

-Assembly line (ford)
-electrical machinery
-- ford wanted to produce a cheap affordable car

GDP Increased:
Real Wage Increase

1919-1929: 40%
1919-1929: 15%

Productivity increased

1910s: 12% 1920s 64%

Price Reductions on the Model T

1908 $850
1923 $290

Results of the 2nd Industrial Revolution

Productivity Increased
growth of economy
wage increase

Need for increased consumption

-19th century ethos: Save
-economy based on consumer goods needs new ethos: spend

Fords motto

"buy a ford and spend the difference"

Advertising

Increased Quantity
Change in content of Advertising
Ads aimed at women

Increased Quantity

1919: $1.4 billion on advertising
1929: $3 Billion on advertising
*more then they spent on public education

change in content of advertising

19th century ads:
-informational-what the car was made out of
-told what the product would do
Early 20th century ads
- played on peoples fears and anxieties
-told stories

ads aimed at women

-played on anxieties about well being of their families
-emphasized role as house wife

Product Differentiation

-Market Saturation
-Varied Product Line
-Annual Model Change

Market Saturation

people who wanted it already had it

Varied Product line

GM car divisions
people in middle class in the 1920s wanna show off their material success

Billy Durant

1908- gone early 1920s
thought of the idea to have different types of cars cheapest to most expensive Chevy, Pontiac, Olds mobile, Buick, Cadillac

V.P. Alfred Sloan

-central office to watch over divisions
Chevy- $500
Cadillac- $3000

Annual model changes

-fords model T never changed
-need annual changes to lure new buyers
-gives people another reason to buy a car

Installment Buying

-extensive loans rare in the 19th century
-consumer credit expands early 20th century

Extensive loans rare in the 19th century

-mainly house loans

Consumer credit expands early 20th century

general motors acceptance corp-loan division

Debt

1920- 3 billion
1929-7 billion

Mass Consumption

Increased Consumption levels
limits to working class and farm family
economic inequality

Cars in Use

1920- 8 million
1929- 23 million only 55% of families

W.E.B. DeBois

to be a poor race is hard but to be a poor race in the land of dollars is the very bottom of the ship

Economic Inequality

1928 top 5% earned 30% of all the income bottom 40% earned 12% of income

The Great Depression

worst economic crisis in American history with unemployment reaching 25% and widespread suffering

Argument

-The federal govt/ president hoovers response to the GD was totally inadequate
-as a result some Americans radicalized by the experience of the depression question legitimacy of our form of Govt
-Consequently by 1932 many americas feared the nation might experience either a revolution or the rise of a dictator

Economic Indicators

Economic recession Summer 1929
stock market crash
rising unemployment
declining incomes

Economic recession Summer 1929

-part of business cycle of industrial capitalism
-stock market in decline by September

Stock Market Crash

-October 29, 1929
-Stock lost 10 billion in value
-GM stock declined from $73 to $8 per share 1929-1932
-worsens existing recession
-most stocks were bought on credit

rising unemployment

peaks at 25%

declining incomes

median income declines by 50% by 1932

Why a Depression

-weak industries prior to depression
-agriculture, textiles, mining
-under consumption

Unemployment Impact

-Homelessness and Hunger
--hoovervilles- shanty towns of homeless people
--soup lines
-Uneven impact
1. Race
--St. Louis Unemployment ,1931
-White 22%
-Black 43%
2. Gender
-men higher rates than women

Employment Widget Sticks

100 workers
30 skilled workers
50 semi skilled
20 unskilled african/latino

Conditions of the Job

-Shorter hours
-lower pay
-worsening conditions

Lower Pay

1929-92 cents an hour
1933- 59 cents an hour

Worsening Conditions

1. Stretch out and speed up
2. Sexual exploitation of women

Hoovers Philosophy

-no direct federal relief
-no government regulation of business
-not an advocate of laissez-faire policies
-advocate of associationalism
hoover said country should be a giant accounting firm

Hoovers Policies

1. increase government construction projects
2. Business conference to find solutions
3. Reconstruction finance corp. (1932)- government entity provided loans
4.Increased taxes to balance the budget
-Hoover believed in steeply graduated income and inheritance taxes

Farm auction

penny auction

Unemployed Councils

1. Communist party
2. Large protest

Communist Party

-10,000 members nationwide radically indifferent
-very good at organizing

Large Protest

-March 6, 1930
-thousands of unemployed people nationwide gathered in squares to protest

Impact

1. prompted some aid locally
2. created climate of crisis for 1932 elections
-also prompted severe recession

The New Deal : Pragmatic Response to Crisis

The new deal: name for FDR's legislative response to the great depression

Pragmatic Response

-FDR was a pragmatist not an ideologue
-you become so obsessed with a political idea that you become blind to the facts
-changed approaches when necessary

Changes in Approach resulted from:

-lack of success of some programs
-political pressure, especially from the left

New deal did not end the great depression

-found the solution but backed away from it to quickly

1932 Election

-FDR, Pragmatist not ideologue
-prohibition was still around

The First New Deal

-Relief Programs
-Recovery Programs (1933)
-Reform Programs

Relief Programs

-Provided assistance to people out of work
-Federal Emergency Relief Administration
-Civilian Conservation Corp. (CCC)-1933 temp employment
-Civil Works Administration (CWA)- govt run building projects
-Public Works Administration (PWA)- longer term projects

Recovery Programs

-Assumption: too much production lowers prices/profits
-Approach: reduce overproduction through planning
1. Agricultural Adjustment Administration (AAA)
-sets production quotas, pays farmers not to do things
2. National Industrial Recovery Act (NRA)
-industrial code- production quota set prices, set wages, set hours
-section 7(a) workers have a right to join a union

Reform Programs

1. Glass-Steagall Act (1933)
a. Investment vs commerce
b. Federal Deposit Insurance Corp.
2. Securities and Exchange commission
-keep an eye on Wall street

Challenges of the New Deal

-Limited success of recovery programs

Challenges from the right

-American Liberty League (1934)

Challenges from the left

1. Huey Long
-share our wealth society
--all inheritance over 5 million dollars gets taxed at 100%
--anything people make over 1 million gets taxed 100%
2. Upton Sinclair- was socialist until 1933
-end poverty in California/ EPIC
-Federal taxes pay for it

Labor uprisings

-Minneapolis Teamsters Strike (1934)
-Truck drivers and warehouse workers
-5000 went on strike
-socialist workers party
-Leon Trotsky

The Second New Deal 1935-1941
A New Approach

-Provide economic security for citizens
-Stimulate consumption/ economic recovery by:
--increasing personal incomes
--increasing government (deficit) spending
-Gain politcal support

Works Progress Administration

-Build Schools
-buildings
-tons of educational buildings
-cultural projects too
-send unemployed educated teachers out to interview former slaves
-wrote guide books to every state

Social Security Act

-Old age pension
-Unemployment compensation
-funded by each state, each state had its own system and employers paid into that fund to ensure that their workers wouldnt experience unemployment
--didnt apply to domestic workers or agricultural workers
-Welfare for the deserving poor
--children or mentally disabled

National Labor Relations Act/Wagner Act

-Oversees effort to join a union
-holds elections in work place to see if they want to join a union
-Collective Bargaining
-National Labor Relations Board

Impact of the Second New Deal

FDR Labor Alliance Solidified

FDR Labor Alliance Solidified

1. Growth of Congress of Industrial Organization
-United Auto Workers Union
-1932 2.8 million union members
-1942 10.5 million union members
2. FDR reelected in 1936 with big labor vote

The Roosevelt Recession

A.FDR nervous about deficit spending
B. FDR supports budget cuts, 1936
C Economy declines in 1937

John Maynard Keynes

The General Theory of Employment, Interest and Mon

FDR reverse course

1. 1938 government spending increases
2. Economy improves
3. Spending still insufficient for full recovery

Impact of WW2

1. Required massive government spending
2. Economy recovered
3. Widespread acceptance of Keynes views after the war

Conclusion

Th New deal did not end the Great Depression

Fascist Nations During the Great Depression

-Germany
-Italy
-Japan

Fascism

a type of political ideology supporting a dictatorship in which the state nation and race are glorified over individual liberties and rights

Japanese Aggression

-1931-32 invasion of Manchuria
-1937 takeover of Northern China

Italian Aggression

Ethiopia 1934

German Aggression

-Hitler rebels against limits of Versailles Treat ending WW1
-Begins building up a military in 1930s
-1936-39: Invasion of Rhineland, Austria, Czechoslovakia
-September 1 ,193: Invasion of Poland
-War in Europe begins

Isolationists

-opposed to US involvement in the war
-primary reason we went to war the first time was because there were bankers and businessmen who made huge profits off the war *"Merchants of Death"*

Internationalists

-Thought that we should get involved because the things theyre doing over there affect us
-Lend Lease Act (1941)-US lends naval ships to the Allies
--British lease the US naval bases on some of their colonies and islands

US goes to war
-Conflict with japan

-Continued Japanese aggression
-US froze Japanese assets/ instituted a trade embargo (oil)

Pearl Harbor Attack

December 7th 1941

US goals in WW2

-Defeats Axis powers
-Atlantic Charter
-Bretton Woods Conference (Summer 1944)

Atlantic Charter

-Churchill and FDR meet on a boat in the middle of the Atlantic to discuss what they want from the war
1. End territorial seizures and war
2. Self-Government for all nations
3. Free trade among nations

Bretton Woods Conference (Summer 1941)

-International Monetary Fund
-World Bank
--To help countries build economic infrastructures
--Had money available to help countries rebuild their stuff after the war
--everyone thats a part of it is supposed to help contribute to the world bank
-Promotion of Free Trade

United Nations

Wilsons idea of collective security
-5 permanent security council members
-the allies

British Views

Winston Churchill: Hands off the British Empire is our maxim

Soviet Views

-Fear of invasion
-WW2 deaths
--25 million or more

Churchill-Stalin Agreement

-Spheres of influence in Balkans
--British: Greece
--Soviets: Romania, Hungary, Bulgaria

Yalta Conference

-Big 3 Meet- February 1945
-Fate of Poland
-Fate of Germany
--Soviets want the german military to be small and weak
--want them to suffer economically
--agree to split german equal
-4 zones

Defeat of Japan

-US wanted Soviet help in defeating Japan

The Potsdam Conference

- Big 3 meet- July 1945
-Trumans tough talk
--wants to be tougher on the soviets
--but he still wants them to enter the war against japan
-gets news that we have successfully tested nukes in the conference
--immediately gets tougher against soviets

The Decision to Drop Atomic Bombs

-August 1945
--Hiroshima (August 6)
-- Nagasaki (August 9)
-Demand for Unconditional Surrender

Why were the bombs dropped

-to save lives of 250,000 US soldiers
-Logical culmination of Conduct of World War
-Concerns about dealing with Soviets after War