For september 8

NANO-ck

Mise-à-jour le 25 March 2024, 3 minutes de lecture

Summer Reading: Read Chapter 5 and 6 United States 1776-1792

Focus on:

• 5.5 How far did the US experience an economic boom in the 1920s?
• 5.6 Why and how did the economic depression affect the US from 1929?

Answer the following questions:

• What were the reasons for the economic boom of the 1920s?
• Why and how did the economic depression affect the US from 1929?
• How the USA was affected by economic depression from 1929-1933?

What were the reasons for the economic boom of the 1920s?

Throughout the 1920s, businesses had benefited from Treasury Secretary Andrew Mellon’s low tax policies. In addition to that, the US had a very effective internal transportation system. Since 1869, transcontinental railroads united the country. To fuel economic growth, the USA possessed an abundance of raw materials. The United States were also pushed by the entrepreneurial spirit and the American Dream. Everyone would want to launch their own business, and work hard to become a “self-made millionaire”.

Another reason for the economic boom is the impact of the First World War. In 1914, the USA had become one of the world’s major industrial powers. Its major economic rivals virtually bankrupted themselves fighting the First World War.

In parallel, the USA benefited from technological progress, including the “Fordism”. Assembly lines were used to mass-produce goods. The Ford Motor Company was the first to use this method. The assembly line allowed the company to produce cars at a much faster rate. The Ford Model T was produced at a rate of a car every 10 seconds. The company also paid its workers a high wage, which allowed them to buy the cars they were producing. The company created a revolution in the industrial world, and other companies followed its example.

Why and how did the economic depression affect the US from 1929?

Share prices on the New York stock exchange collapsed in October 1929. The crash was caused by a number of factors, including the overproduction of goods, the availability of easy credit, the unequal distribution of wealth, and the fact that farmers and industrial workers had not shared in the prosperity of the 1920s. The fall in the value of shares created an atmosphere of uncertainty among shareholders, who began to sell their stocks.

How the USA was affected by economic depression from 1929-1933?

The most obvious effect on the lives of Americans was the sharp rise in unemployment. Before the Crash, unemployment had been rising in the coal and textiles industries. The gross national product collapsed as the econommic activity did. Average weekly earnings fell from 25$ to 17$ between 1929 and 1933.

The economic depression also affected the lives of farmers. The price of agricultural products fell by 50% between 1929 and 1932. Farmers were unable to pay their mortgages and many lost their farms.

The economic depression also affected the lives of African-Americans. They were the first to be fired, and the last to be hired. The unemployment rate for African-Americans was twice as high as for whites. They were hit by racism and discrimination.

• Rise on unemployment
• Fall in the gross national product
• Poor diet, clothing
• Loss of homes Migration