1920’s Politics & Economics

Ford Revolutionizes Industry

Henry Ford starts selling the Model T in 1908. He pays people a living wage so that they, too, could afford to buy his cars.

He is the most successful automobile manufacturer.

Assembly Line

Henry Ford begins the first assembly line. This revolutionized industry. Instead of producing one car per day, he boosts it to one car a minute. At the same time the price drops to $500.

Workers complain. “Ford workers are not really alive. They are half dead.”

Welfare Capitalism

To beat labor unions, many capitalists begin offering recreational programs, and more importantly, pensions for their workers. The thought was to improve the lives of workers and hopefully keep the workers from organizing into unions, which could disrupt the workforce through strikes.

This is called welfare capitalism. It creates loyalty in workers, and has an interesting byproduct: it increases productivity.

Suburbs!

During this explosive growth in industry and through car sales, cities sprawled into suburbs that often encircled the city.

Housing was cheaper there, and it led to a higher quality of life.

Buy everything! Quick!

Using that assembly line technology in numerous businesses, the price on new electronic devices dropped. This, in turn, allowed many middle-class families to buy these new, fancy items for their homes.

This starts the “keeping up with the Jones’” philosophy.

Installment Buying

Many people use installment buying to purchase these new, fancy products that they otherwise couldn’t afford.

Now most of America was in some sort of debt, because of their car, their washing machine, their house, etc.

This all leads to a weak economy

Many people expanded this ‘buying on credit’ philosophy to the stock market. Lot of Americans bought stocks and certificates through loan money. fine. goes Because the market was rising, everything was But when it down, it would be catastrophic.

The Harding Presidency

Warren G. Harding was a senator from Ohio who really enjoyed his free time. He was not a hard working, effective president. He wanted to be like the presidents before TR…a ceremonial duty at best. Who voted for him? People who wanted to return to normalcy after the chaotic war and flappers and no drinking. He was a reserved Republican.

Harding’s Policies

Harding’s philosophy was to keep his mouth shut. He kept government out of business, and vice versa. He did NOT want farmers to get subsidies; he did NOT want any controls on business. He thought that if the businesses had extra money, they would donate it to charity or hire more workers. It didn’t happen.

Scandal!

Because of his hands-off style, he was prone to gossip. He appointed many friends to lower level jobs, all of which took numerous bribes. The ‘Ohio Gang’ were found guilty and removed from office, but the scandal remained. The Teapot Dome scandal also implicated Harding. His Secretary of the Interior allowed oil drilling on federal land in return for kickbacks.

Death & Demise

Harding’s death was an interesting one. They think he died from heart disease and the combination of stress, overwork, and his own lifestyle. went to didn’t taxing He simply bed and wake up.

His wife refused to have him embalmed and didn’t allow an autopsy. This was odd, even for then.

The Coolidge Presidency

Calvin Coolidge took over after Warren G. Harding’s death. He was from Vermont, and was the Governor of Massachusetts during the Boston Police Strike. Because of that, he was seen as an advocate for public safety.

Americans felt ok about Coolidge taking over. He was smart, principled, and known for being honest.

Calvin in office

Coolidge was immediately trusted and seen as a good guy for America. He was extremely unwilling to meddle in business affairs, and not willing at all to establish any programs for poor people and workers. He was very Republican. He wanted lower taxes and less restraints on businesses. He was the polar opposite of TR on the Republican continuum.

Coolidge the man

He was a very funny man, who joked often. At the same time, he was very reserved with his opinions on government and business. For this reason, his nickname was “Silent Cal.” It was the perfect time for a Republican president, since most people in the US were doing so well and, thus, didn’t need a lot of help.

Even as a shoo-in for president in 1928, he just said no. He walked away from the presidency.

Politics in general

The Presidents were all about big business and helping them become even bigger. Most people didn’t mind since they were doing fairly well for themselves. Both of these presidents were seen as innocuous but not active.

Economics in general

The American economy was steadily moving towards one of credit and borrowing . This put us in a precarious position for a downward trend in the stock market.

Find the trends!

Please look back through your notes and complete the following sections using only your own brain: Politics Economics