Prosperity and Depression

1. Prosperity and Depression Unit 2 Chapter 7 The Twenties 1919 – 1929 Chapter 8 The Great Depression Chapter 9 The New Deal

2. The Twenties1919 - 1929 Chapter 7

3. Overview Computer Lab • Search for icons of the 1920’s – images and video of art, advertising art and slogans, entertainment, music, sports • Google Images, Youtube, etc. • Use your book as a guide • Place the images and video in PowerPoint. • We will assemble all into a single file. • One point for each image or video placed in PowerPoint with citation – twenty minimum.

4. A Booming Economy Section 1

5. Learning Objectives • Explain the impact of Henry Ford and the automobile. • Analyze the consumer revolution and the bull market of he 1920’s. • Compare the different effects of the economic boom on urban and rural America

6. Terms and People • Henry Ford • Mass production • Model T • Scientific management • Assembly line • Consumer revolution • Installment buying • Bull market • Buying on margin

7. Assignments • Icons of the Twenties

8. Assessments • Test, Chapter 7

9. Why it Matters Remember, after World War I the United States is the largest creditor nation • We suffered no damage to the homeland • Our losses, relative to our allies, where much less • Old Empires were damaged and could not compete economically with the United States By 1919, United States poised to begin a rapid economic expansion

10. Why it Matters Our objective: How did the booming economy of the 1920’s lead to changes in American life?

11. Why it Matters

12. Why it Matters Before the boom, there was a postwar recession and depression to the economy that lasted into 1921 Why? • Factories had to shift from war production to peacetime • Global markets with demand for U.S. products fell back • U.S. troops returned in tremendous surge into the civilian job market

13. Why it Matters

14. Why it Matters Before the boom, there was a postwar recession and depression to the economy that lasted into 1921 Why? • Increased competition for available jobs pushed wages down and diminished union power • Series of significant labor strikes • Known as the Depression of 1920 – 1921

15. Why it Matters • U.S. Unemployment from 1910 to 1960

16. Why it Matters • Dow Jones Industrial Average (Stock market) from January 1918 to January 1923.

17. The Automobile Drives Prosperity • Recession/Depression does end. • Stock market rises • Unemployment falls as demands for goods increase; wages rise • One product may have sparked much of this economic expansion…

18. The Automobile Drives Prosperity Ford Motor Company’s car for everyman, the Model T

19. The Automobile Drives Prosperity • Henry Ford, the man who revolutionized automobile production

20. The Automobile Drives Prosperity • Henry Ford biography video • http://www.youtube.com/watch?v=QtYRLtT8bvY

21. The Automobile Drives Prosperity

22. The Automobile Drives Prosperity • Ford’s River Rouge Plant, Detroit Michigan, the largest industrial facility in history

23. Ford Pioneers Mass Production • Mass production • Ford applied the idea to automobiles which had thousands of parts, not just hundreds • Scientific management • New method of examining every task required to create a product • How long to accomplish each step; how many workers needed; etc. • Looked for ways to reduce production time, cost, labor

24. Ford Pioneers Mass Production • Assembly Line • Applied lessons of slaughter houses – which took apart cattle – reversed the process to put machines together from individual parts • Reduced Model T production time from 12 hours to just 90 minutes per car. • Result: more cars made and at less cost • Model T retail price fell from $290 by 1927 • Ownership of automobiles rose from 10% in 1919 to 56% in 1927

25. Ford Pioneers Mass Production • Ford assembly line for the Model T

26. Ford Pioneers Mass Production http://www.youtube.com/watch?v=PZnGWJ_6BwU

27. Ford Pioneers Mass Production • Assembly Line • Workers are no longer skilled craftsmen; instead they perform simple tasks repeatedly • However, does allow for more rapid hiring and training of workers

28. The Automobile Changes America • Increased production and ownership of automobiles causes demand in other products” • Rubber tires, steel, glass, gasoline • Increased mining for metals and petroleum • Increased trade for natural rubber • All these products expanded their own factors and hired more workers

29. The Automobile Changes America • More cars needed more roads • Which brings up an experiment carried out by the U.S. Army in 1919 • Lead by a young lieutenant…. • Dwight D. Eisenhower • Mission: lead a convoy of trucks across the Continental United States • How quickly can the Army move by truck if the need arose?

30. The Automobile Changes America http://www.eisenhower.archives.gov/research/online_documents/1919_convoy.html

31. The Automobile Changes America http://www.eisenhower.archives.gov/research/online_documents/1919_convoy.html

32. The Automobile Changes America http://www.eisenhower.archives.gov/research/online_documents/1919_convoy.html

33. The Automobile Changes America • Road construction boomed during the 1920s • Numbered system of highways introduced in 1926 • New services arose along the new highways catering to the automobile traveler • Gas stations, repair garages, motor hotels (motels) • These added jobs

34. The Automobile Changes America • Map of U.S. Highway system, 1926

35. The Automobile Changes America • Automobile did diminish passenger travel by train and public transportation in cities • Why wait when you could go anywhere and anytime you wanted? • Why live in the crowded city when you could drive to work from the country?

36. A Bustling Economy • Consumer revolution • Wave of new consumer goods designed to bring convenience to the consumer • Refrigerators, vacuum cleaners, electric irons, telephones, etc.

37. Advertising and Credit Build a Consumer Culture • Advertising industry grew to support the consumer revolution • Applied new consumer market research techniques • What does the customer want? How can advertising influence the decision to buy? • How to persuade consumers to buy even when they do not have all the money? • Installment buying • Small down payment followed by regular small payment - installments

38. The Big Bull Market Makes Fortunes • Rapid economic expansion offers ordinary Americans the opportunity to invest companies • Buy stock – certificates of fractional ownership in a corporation

39. The Big Bull Market Makes Fortunes Buy stock on margins • Buyer does not need to front all the cost of stock shares; only a small percentage • Like buying on credit – great if the stock price keeps rising, but…. • If the price falls and/or the company fails, buyer immediately responsible for paying entire balance

40. Cities, Suburbs, and Country • While the automobile offered chance of living outside the city… • Most jobs were still in the city and cities where undergoing rapid construction boom • Skyscrapers • http://www.youtube.com/watch?v=qBTEe-I16Po&list=PLD574AB55B39214F8

41. Many Americans Face Hardships • Rural farmers did not enjoy the increased prosperity • End of the war lead to fall in farm crop prices • Farmer income levels fell; debt increased

42. Summation • Explain the impact of Henry Ford and the automobile. • Analyze the consumer revolution and the bull market of he 1920’s. • Compare the different effects of the economic boom on urban and rural America

43. The Business of Government Section 2

44. Learning Objectives • Analyze how the policies of Presidents Harding and Coolidge favored business growth. • Discuss the most significant scandals during Harding’s presidency. • Explain the role that the United States played in the world during the 1920’s.

45. Terms and People • Andrew Mellon • Herbert Hoover • Teapot Dome Scandal • Calvin Coolidge • Washington Naval Disarmament Conference • Kellogg-Briand Pact • Dawes Plan

46. Assessments • Test, Chapter 7

47. Why It Matters President Warren G. Harding • Elected 1920 – landslide 60% of the vote • Promised “return to normalcy.” • Halt progressive reforms • Favored policies which aided growth of business • Laissez-faire philosophy

48. Why It Matters Our objective: • How did domestic and foreign policy change direction under the Harding and Coolidge administrations?

49. The Harding Administration • What would Harding do to signal a change in federal economic policy?

50. New Policies Favor Big Business • Pro-business attitude of Harding signaled by appointment of Andrew Mellon to Secretary of Treasury, 1921 • Would serve almost 12 years • What could a Secretary of Treasury do?