The Roaring Twenties and the Great Depression

The Roaring Twenties and the Great Depression Study Notes

The Roaring Twenties

Post-War Recession

  • Years of post-war recession in the United States: 1919 – 1920.

  • Difficulty of transition from wartime economy: 1919-1920 saw a challenging shift as factories that once produced war materials had to adjust to peacetime production, leading to disruptions and economic instability.

Economic Growth

  • Characterization of 1920s economic growth: The 1920s, also known as the "Roaring Twenties," was marked by significant industrial growth, consumerism, and advances in technology.

  • Impact of rapid growth in consumer goods: The expansion in consumer goods availability stimulated the economy, increased employment, and improved living standards.

  • Role of mass production: Mass production techniques, epitomized by the assembly line, allowed for faster and cheaper manufacturing, increasing output and reducing costs.

Automobile Industry

  • Impact of automobile industry on economic growth: The automobile industry was a major driver of economic expansion, leading to the growth of related sectors such as steel, rubber, and glass industries.

  • Automobiles in use by 1930: Approximately 26 million automobiles were in use in the United States.

  • Industries linked to automobile boom: Industries such as oil, road construction, and automotive parts manufacturing saw significant growth as a result of the automobile boom.

  • Contribution to suburban expansion: The automobile facilitated suburban growth by enabling people to commute to urban centers for work, expanding residential areas.

  • Innovation by Henry Ford: Henry Ford introduced the moving assembly line, revolutionizing car production by allowing for mass production of vehicles.

  • Gospel of Standardization: This concept referred to the idea that standardized parts and production methods would increase efficiency and reduce costs in manufacturing.

  • Price reduction of the Model T: By the 1920s, the price of the Model T had been reduced to approximately $290.

  • Installment plan impact: Installment plans enabled many middle-class Americans to afford automobiles by allowing them to pay in smaller increments over time.

Aviation and Radio

  • Primary use of airplanes in the 1920s: Initially focused on mail delivery and later expanded to commercial flights.

  • International fame in aviation: Charles Lindbergh gained famous recognition for his solo flight across the Atlantic in 1927.

  • Establishment of the first radio station: The first radio station in the United States was established in 1920.

  • Growth of radio stations: By 1922, there were approximately 500 radio stations operating nationwide.

  • Purchase percentage of radios: By the end of the 1920s, about 50% of American families owned a radio.

  • Significance of the Radio Act of 1927: This Act aimed to limit the number of radio stations to reduce interference and regulate the airwaves.

Household Innovations

  • Refrigerators changing household life: Refrigerators began to change household storage and food preservation, marking a shift in domestic life.

  • Expensive nature of refrigerators: During the 1920s, refrigerators were considered very expensive due to their new technology and the materials used.

  • Movie attendance: Approximately 95 million viewers attended movies weekly during the 1920s.

Social Changes and Organizations

  • Characterization of social changes: The 1920s saw significant shifts in social norms, including increased social freedoms, changing gender roles, and new cultural movements.

  • Main beliefs of the New KKK: The New Ku Klux Klan advocated white supremacy, nativism, and anti-immigrant sentiments, and they expanded their targets beyond African Americans to include Catholics and Jews.

  • Membership of the Ku Klux Klan by 1925: The organization had about 4 to 5 million dues-paying members by this time.

  • Collapse of the New KKK: The Klan faced internal strife, scandals, and declining public approval, leading to its collapse in the late 1920s.

Immigration and Prohibition

  • Purpose of the Immigration Act of 1924: This Act aimed to limit immigration from Southern and Eastern Europe, establishing quotas based on national origins.

  • Favored European nations: The Act favored Northern and Western European countries, ensuring higher immigration rates from those regions while restricting others.

  • Exclusion of Japanese immigrants: Japanese and other Asian immigrants were explicitly excluded through provisions of the Immigration Act of 1924.

  • Time period of Prohibition: Prohibition lasted from 1920 to 1933 (18th Amendment).

  • Challenges in enforcing Prohibition: Difficulties included widespread criminal activity, lack of public support, and corruption among law enforcement.

  • Definition of a "speakeasy": Speakeasies were illicit bars that operated secretly during Prohibition, serving alcoholic beverages.

  • Bootlegging: This term referred to the illegal production and distribution of alcohol, commonly associated with organized crime during Prohibition.

Political Landscape

  • Candidates in the presidential election of 1920: Warren Harding (Republican) and James M. Cox (Democrat).

  • Harding's campaign slogan: “A Return to Normalcy” emphasized a desire to return to pre-war conditions.

  • Significance of the 1920 election for women: The election was significant because it was the first in which women could vote nationally after the 19th Amendment was passed.

  • Connection between Prohibition and gangsterism: The "Golden Age of Gangsterism" referred to the rise of organized crime due to the illegal alcohol trade during Prohibition.

  • Estimated financial take of the underworld: It is estimated that organized crime made approximately $1 billion annually during the 1920s.

  • Harding administration and big business: Harding's administration generally favored businesses, reducing regulations and anti-trust enforcement.

  • Teapot Dome Scandal: A bribery scandal involving Secretary of the Interior Albert Fall, who leased Navy petroleum reserves without competitive bidding. The scandal marred Harding's presidency.

  • President Harding in 1923: Harding died in office in 1923, and Vice President Calvin Coolidge became president.

Presidential Elections and Economic Policies

  • Presidential election of 1924 winner: Calvin Coolidge won easily due to a strong economy and public support.

  • Dawes Plan: This was a financial plan to assist Germany in paying war reparations, stabilizing the European economy.

  • Coolidge's choice not to run in 1928: He opted for not running due to personal preferences and belief that he had accomplished enough.

  • Candidates in the 1928 election: Herbert Hoover (Republican) vs. Alfred E. Smith (Democrat).

  • Role of radio in the 1928 election: Radio played a critical role in campaigning and reaching voters, changing how political communication occurred.

  • Republican slogan against Smith: The Republicans portrayed Smith as someone who would bring Catholic influence into politics, contributing to anti-Catholic sentiments.

Stock Market

  • Definition of a "Bull Market": Refers to a condition in which stock prices are rising or are expected to rise, indicating confidence in the market.

  • Margin buying: This practice allowed investors to borrow money to buy stocks, contributing to excessive stock market growth and risk.

  • Separation of stock prices from company values: This disconnection began around 1928, leading to unsustainable speculation.

Stock Market Crash and the Great Depression

Prelude to the Crash

  • Beginning of stock price declines: Stock prices began to fall in late 1929, culminating in the crash.

  • Significance of "Black Tuesday": October 29, 1929, known as Black Tuesday, marked the most significant crash, resulting in a massive loss of wealth.

  • Immediate economic consequences: The crash prompted widespread bank failures, a decline in consumer spending, and rising unemployment.

Causes of the Great Depression

  • Definition of the "Great Glut": Refers to overproduction of goods that exceeded consumer demand as a major contributing factor to the Great Depression.

  • Overexpansion of credit: Excessive credit expansion led to an inflated economy, which, when it burst, left many in financial ruin.

  • Impact of high tariffs: Tariffs on imports led to retaliatory measures from other nations, hindering international trade and worsening the depression.

  • "Hoovervilles": Shantytowns named after President Herbert Hoover, where the unemployed and homeless congregated during the Great Depression due to inadequate government response.

  • Local government and charity relief efforts: Many local efforts collapsed under the strain of demand, leaving many without essential food and services.

Hoover Administration

  • Purpose of the Reconstruction Finance Corporation (RFC): This government agency was created to provide financial support to banks and businesses during the Great Depression.

  • Bonus Army: A group of World War I veterans who marched on Washington in 1932 demanding payment of war bonuses; their confrontation with Hoover's administration led to significant political backlash.

  • Impact of the Bonus Army confrontation on Hoover: The violent dispersal of the Bonus Army severely damaged Hoover’s standing and perception as a leader.

Election of 1932

  • Candidates in the 1932 presidential election: Franklin D. Roosevelt (Democrat) vs. Herbert Hoover (Republican); Roosevelt won decisively.

  • New Deal proposal: Franklin D. Roosevelt proposed the New Deal to provide immediate economic relief, recovery, and reforms to prevent future depressions.

  • Significance of “fear itself”: Roosevelt’s quote highlighted the psychological impact of fear on people and emphasized confidence in overcoming hardships.

First Hundred Days of Roosevelt's Presidency

  • Characteristics of the First Hundred Days: Marked by rapid legislative action introducing various programs targeting economic recovery and reform priorities.

  • Three main goals of the New Deal: The New Deal aimed at Relief for the unemployed, Recovery of the economy, and Reform of the financial system.

  • Roosevelt’s Fireside Chats: These were radio addresses where Roosevelt communicated directly with Americans to explain his policies and gain public support.

  • Purpose of the Emergency Banking Act of 1933: The Act aimed to stabilize the banking system, allowing banks to reopen under new regulations once deemed solvent.

  • Glass-Steagall Banking Reform Act of 1933: This legislation aimed to separate commercial and investment banking to protect depositors from financial risk by establishing the FDIC.

  • Role of the FDIC: The Federal Deposit Insurance Corporation was established to provide insurance to deposits, prevent bank runs, and promote banking stability.

  • Purpose of the Securities Exchange Act of 1934: This Act created regulations for the securities industry and established the Securities and Exchange Commission (SEC).

  • Impact of the 21st Amendment: The 21st Amendment repealed Prohibition, allowing legal production and sale of alcohol, uniquely ratified through state conventions.

  • Civilian Conservation Corps (CCC): A program designed to provide jobs for young men in environmental conservation projects.

  • Tennessee Valley Authority (TVA): A major New Deal project that provided jobs and improved the economy in the Tennessee Valley through electricity generation and flood control.

  • Works Progress Administration (WPA): An agency that funded various public works projects to employ people and develop infrastructure.

  • Causes of the Dust Bowl: Drought, poor agricultural practices, and economic factors led to severe dust storms that devastated the Great Plains region.

Economic Inequality

  • Huey Long’s “Share Our Wealth” program: Proposed wealth redistribution to address economic inequality and ensure every American had a decent standard of living.

  • Key provisions of the Social Security Act of 1935: Established a social insurance program aimed at providing financial assistance to the elderly, disabled, and unemployed.

  • Wagner Act (National Labor Relations Act) of 1935: Empowered labor unions and guaranteed the right of workers to organize and engage in collective bargaining.

  • Outcome of the 1936 presidential election: Franklin D. Roosevelt won by a landslide, signaling strong public support for the New Deal policies.