1920s Prosperity

Automobile • By 1920 there were 9,000,000

registered automobiles in the U.S.

• By 1929 the U.S. had 26.7 million registered vehicles, and motorists traveled an estimated 198 billion miles during the year.

• Henry Fords assembly line system reduced the time needed to create an automobile and reduced the cost of production- Thus making the car affordable to the masses. In 1929 American automakers sold 4.5 million units in the domestic market.

• The auto manufactures became massive consumers of materials and spurred the growth of other industries such as rubber, plate glass, nickel, and lead. 15 percent of the nations steel output went to the auto manufacturing industry.

Social Impact of the Automobile• The car became an affordable

necessity for the middle class

• It created new small business opportunities to service them-garages and service stations

• It eased the isolation of people living in rural areas

• It allowed people to live farther away from work and this lead to the growth of suburbs. Before the automobile people lived and worked within 15 miles of their homes

• Even the federal government became involved with the Federal Highway Act of 1921 which provided federal aid to the states for the building of an interconnected interstate highway system. Gas stations began to dot the land, and mechanics began to earn a living fixing the inevitable problems. Oil and steel were two well-established industries that received a serious boost by the demand for automobiles. Travelers on the road needed shelter on long trips, so motels began to line the major long-distance routes.

• Even cuisine was transformed by the automobile. The quintessential American foods — hamburgers, French fries, milk shakes, and apple pies —were hallmarks of the new roadside diner. Drivers wanted cheap, relatively fast food so they could be on their way in a hurry. Unfortunately, as new businesses flourished, old ones decayed. When America opted for the automobile, the nation's railways began to be neglected. As European nations were strengthening mass transit systems, individualistic Americans invested in the automobile infrastructure.

• The social effects of the automobile were as great. Freedom of choice encouraged many family vacations to places previously impossible. Urban dwellers had the opportunity to rediscover pristine landscapes, just as rural dwellers were able to shop in towns and cities. Teenagers gained more and more independence with driving freedom. Dating couples found a portable place to be alone as the automobile helped to facilitate relaxed sexual attitudes.

• Americans experienced traffic for the first time, as well as traffic accidents and fatalities. Soon demands were made for licensure and safety regulation on the state level. Despite the drawbacks, Americans loved their cars. As more and more were purchased, drivers saw their worlds grow much larger.

Consumer GoodsNew inventions • Electric razor

• Indoor plumbing became more readily used

• Household cleaning products

• Electric irons

• Vacuum cleaners

• Washing machines

• Refrigerators

• Gas stoves

• Improved glass cookware

Consumer products- focused on fashion, youthful appearance, and success in business• Mouthwash

• Deodorant

• Cosmetics and perfumes became popular in the 1920s

The Airline Industry

• The first successful flight was by the Wright Brothers in 1903

• Curtis invented the aileron that made it possible to build rigid wings and much larger aircraft.

• 1912 Curtis designed a flying boat and by 1919 it became the first aircraft to cross the Atlantic

• In 1918 President Wilson’s postmaster general introduced the worlds first regular airmail service

• In 1925 the industry received economic boost with the passage of the Kelly Act which authorized postal officials to contract with private airplane operators to carry the mail.

• 1927 Lindbergh made his non-stop trip from New York to Paris

• By 1928 Ford Motor Company was advertising the benefits commercial flying for businessmen.

Radio • 1912 Edwin Armstrong invented a special circuit that

made long range radio transmission of voice and music practical.

• KDKA transmitted the first commercial radio broadcast (the election results of the Harding-Cox race) on November 2, 1920. At the time not many people were listening as not many people had receivers.

• By the late 1920’s, radio shows including westerns, detective shows, children’s shows, soap operas, romances, and comedies, grew more sophisticated with carefully orchestrated plots, lively dialog, and masterful soundtracks

• The first serial program, a show with a plot that continued to build and develop from week to week, was Amos ‘n’ Andy. Debuting in 1929, the daily fifteen minute episodes centered around two African America characters who were stereotypically depicted as “buffoons”. Amos ‘n’ Andy was one of the most popular radio shows on the air.

• Between 1923 and 1930, 60 percent of American families purchased radios. Families gathered around their radios for night-time entertainment. As radio ownership increased, so did the number of radio stations. By 1922, 600 radio stations had sprung up around the United States.

• By 1929 there were 10 million radios in use in America

• New broadcasting companies CBS and NBC

Easy Credit• Before the 1920s owing money was

seen as shameful• 1920s attitudes on debt started to

change- installment plans became popular. 75% of radios and 60% of automobiles were bought on installment plans.

• Americans even bought stock in the stock market on credit. During the late 1920s, the stock market in the United States boomed. Millions of Americans began to purchase stock, causing the market to dramatically increase in value. Unfortunately for the economy, so many Americans invested money in the stock market that stocks became inflated in price.

• When someone did not have the money to pay the full price of stocks, they could buy stocks "on margin." Buying stocks on margin means that the buyer would put down some of his own money, but the rest he would borrow from a broker. In the 1920s, the buyer only had to put down 10 to 20 percent of his own money and thus borrowed 80 to 90 percent of the cost of the stock. They did this with the hope that stock prices would continue to increase and then they could pay of the margin and make a profit.

• Buying on margin could be very risky. If the price of stock fell lower than the loan amount, the broker would likely issue a "margin call," which means that the buyer must come up with the cash to pay back his loan immediately.

Advertising • 1928 Otto Rohwedder developed a

commercial bread slicer (no one knew they needed one)

• Manufactures turned to advertising to help sell the new products

• Advertising created appealing, persuasive messages that linked their clients’ products with the modern era, such as progress, convenience, leisure, success, fashion, and style.

Welfare Capitalism

• Companies allowed workers to buy stock, participate in profit sharing, and receive benefits such as medical care and pensions.

• There was a push for open shops were workers were not forced to join a union

• With benefits covering some of the workers basic needs they had more money to spend on other things.

Farmers• Did not share in the prosperity of

the 1920s

• During WW1 and the Russian Revolution there was increased demand for wheat and other crops. Prices increased giving farmers an incentives to invest in new land and technology to produce more. After the war the “Quiet Depression” began. Crop prices decreased.

• Crop priced decreased. To add to this new technology allowed farmers to produce more thus driving the prices down even more.

• Many farmers had invested heavily in land and machinery and had fallen into debt while still increasing production.

• Congress contributed to this Fordney-McCumber Tariff 1922 was meant to protect industrial businesses but ended up hurting farmers. The higher tariff created a backlash against American Farm products.

President Vetoes of Farm Bills• McNary-Haugen Bill- would have called

on the Federal Government to purchase surplus crops and sell them abroad while protecting American markets with a high tariff.

• President Coolidge vetoed a second bill

• Coolidge argument against the bills was that as money flowed to the farmers under the law, the farmers would be encouraged to produce even greater surplus volumes, which the government would be unable to sell