The USA in the Interwar Period
1. Interventionism vs. Isolationism: changes in U.S. foreign policy
- You can describe and justify the change in U.S. foreign policy after World War I using technical terms.
During WW1, the USA became more involved in world affairs under president Woodrow Wilson.
He proposed the League of Nations, an international organization meant to prevent future wars.
After WW1, the USA changed from an interventionist foreign policy to a more isolationist one.
(Interventionalism vs. isolationism)
Many Americans were disappointed by the war’s huge costs. People wanted to focus on domestic problems. The US senate rejected joining the League of Nations in 1919. During the 1920s, the USA followed a policy of isolationism, avoiding political alliances and military involvement in Europe. The government introduced protective tariffs (high taxes on import), restriction on immigration and neutrality in Europe.
fear of another war
economic priorities at home
nationalism and distrust of Europe
public opinion demanding normalcy after wartime stress
2. The Invention of the American Way of Life in the Roaring Twenties
- You know the economic development of the USA in the early and mid-20s.
The 1920s => the Roaring Twenties
Reasons for economic growth:
Mass production techniques improved efficiency
Henry Ford introduced the assembly line in car production
Wages increased for many workers
Consumer goods became cheaper
People bought products on credit
- You can explain as well as criticize the concept of the American Way of Life.
The American Way of Life described the belief that happiness and success could be achieved through hard work, consumption, industrial freedom and technical progress.
Some characteristics were the owning of modern products (cars, refrigerators, radios), enjoying leisure activities, belief in social mobility and a strong consumer culture.
Criticism:
many farmers remained poor
African Americans still faced racism and segregation
workers often had difficult conditions despite higher wages
consumerism encouraged materialism
buying on credit led many people into debt
economic prosperity was unevenly distributed
- You know the development of the mass media and economy in the USA in the 20s.
Mass media expanded rapidly and influenced everyday life.
The Radio became a major source of entertainment and news. Hollywood films created a national culture. Advertising became more sophisticated. National celebrities and consumer brands emerged.
Consumption further increased through mass media and it helped spread the ideas of the American way of life.
3. Stock market crash and Great Depression (1929-1939)
- You roughly know the causes that led to the stock market crash and the circumstances of this event.
Causes:
Speculation: Many people bought stocks hoping prices would continue rising.
Buying on Margin: Investors borrowed money to buy stocks. This created huge financial risks.
Overproduction: Factories produced more goods than people could buy.
Unequal wealth distribution: Rich Americans profited the most from the economic growth. Many citizens could not afford products.
weak banking system: Banks made risky loans and invested heavily in stocks.
circumstances of the crash:
Panic selling began in October 1929. Black Thursday and Black Tuesday saw massive stock sell-offs. Share prices collapsed. Investors and banks lost enormous amounts of money.
- You know about the characteristics and the extent of the world economic crisis.
The crash triggered the Great Depression, the biggest economic crisis of the 20th century.
Characteristics: massive unemployment, bank failures, falling industrial production, poverty and homelessness, deflation (falling prices and wages)
Extent:
Millions of Americans lost their jobs and savings.
Farmers suffered badly because crop prices collapsed.
International trade declined sharply.
The crisis spread worldwide because economies were interconnected.
Many countries experienced political instability.
- You know how the USA dealt with the crisis and how attempts were made to overcome it.
Hoover’s response:
He believed in rugged individualism (→ everyone should help themselves) and in limited government intervention.
Many Americans thought that was insufficient.
In 1933, Franklin D. Roosevelt introduced the New Deal.
The government stabilized the banking system by supporting principally sound banks though government loans, which led to a return of confidence among savers. They also intervened through curbing of speculative trading.
the government distributed 3 million dollars to the needy and created artificial jobs through government job creation programs. Trade unions were strengthened by granting them the right to conclude collective wage agreements.
In 1935, Roosevelt launched the second phase of the New Deal. unemployment insurance and old-age pension were introduced, further job creation programs were intended to further reduce the number of unemployed and minimum wages and maximum working hours were introduced.
Although the New Deal did not stop the Great Depression it reduced unemployment somewhat, restored confidence in banks and expanded the role of the government in the economy.