chapter 20 from business culture to great depression: the twenties, 1920–1932

Chapter 20From Business Culture to

Great Depression: The Twenties, 1920–1932

THE TWENTIESThe Century: America’s Time-1920-1929: Boom to

Bust (Peter Jennings, ABC NEWS, 46m)

•https://www.youtube.com/watch?v=RN7ftyZigYs

https://www.youtube.com/watch?v=RN7ftyZigYs

https://www.youtube.com/watch?v=RN7ftyZigYs

The Presidents, 1913-1945

• https://www.youtube.com/watch?v=EthSRi-VxaQ

https://www.youtube.com/watch?v=EthSRi-VxaQ

https://www.youtube.com/watch?v=EthSRi-VxaQ

The 1920s: “Boom Time to Bust” all in the space of a decade

• The decade that followed World War I is known as the Jazz Age or the Roaring Twenties.

• -Flappers--liberated young women; the “new woman”• -Speakeasies—nightclubs that sold liquor in violation of

prohibition• -Soaring stock market-fueled by easy credit and a get-

rich-quick outlook• -radio and movies spread mass culture from coast to

coast; “cult of celebrity” develops• -decade of revolt against morality and mores of the

nineteenth century especially with women: cut hair short, skirts much shorter, smoking, drinking, getting jobs

• -cities, especially NYC, lead the way

THE 1920S: The Business of America: A Decade of Prosperity

“The Chief business of the American people, is business.” President Calvin Coolidge, c. 1923

• 1920s was a decade of prosperity for many Americans• *Automobile* was backbone of economic growth• Annual automobile production tripled during the 20s from

1.5 to 4.8 million• Emergence of General Motors (GM), which soon

surpassed Ford production• Stimulated the expansion of steel, rubber, and oil

production, also road construction, growth of suburbs and the tourism industry

• U.S. companies produced 85% of the world’s cars and 40% of its manufactured goods

THE 1920s: The Business of America: “Birth of a ‘New Society’“

of Consumption and Entertainment

• Focus on a “standard of living” becomes fixated in Americans’ minds

• Proliferation of consumer goods; buying often done on credit or installment plans

• Telephones, vacuum cleaners, washing machines, refrigerators (reduced demand for domestic servants)

• More $$ spent on leisure-vacations, movies (emergence of Hollywood), sporting events

• Radios and phonographs (record players)• Creation of a new celebrity culture: opera tenor Enrique

Caruso, Charlie Chaplin, Babe Ruth (baseball), Jack Dempsey (boxer), Charles Lindbergh (aviator)

Give Me Liberty!: An American history, 3rd EditionCopyright © 2011 W.W. Norton & Company

Figure 20.1 Household Appliances, 1900–1930


During the 1920s, radio penetrated virtuallythe entire country.


Electric washing machines and Hoovervacuum cleaners

1920s America: The Limits of Prosperity

• The fruits of increased production were very unequally distributed

• By 1929, an estimated 40% of the population still lived in poverty

1920s America: The Farmers’ Plight

• Farmers did not share in the prosperity of the decade

• California received many displaced farmers from other parts of the country

1920s America: The Image of Business

• Businessmen like Henry Ford and engineers like Herbert Hoover were cultural heroes.

• Numerous firms established public relations departments

1920s America: The Decline of Labor

• Business appropriated the rhetoric of Americanism and industrial freedom as weapons against labor unions.

• Propaganda campaigns linked unionism and socialism as examples of the sinister influence of foreigners on American life.

• During the 1920s, labor lost over 2 million members

1920s America: The Equal Rights Amendment (ERA)

• The achievement of Women’s Suffrage in 1920 eliminated the bond of unity between various activists

• Alice Paul’s National Woman’s party proposed the ERA

1920s America: Women’s Freedom

• Female liberation resurfaced as a lifestyle, i.e. the Flapper

• New freedom for women lasted only while she was single

The Twenties: Business and Government: The Retreat from Progressivism

• Progressivism disintegrated as a political movement• Leisure activities and consumption replacing politics as

the focus of public concern• Voter participation fell drastically• Shift from public to private concerns; focus on self and

immediate needs, not for the good of the nation• “The American citizen’s first [concern] is no longer that of

a citizen but that of a consumer.”

The Twenties: Business and Government: The Republican “Pro-Business” Era

• Pro-business era; Republicans and Big Business joined at the hip

• 1920s golden age for Republican business leaders (wanted lower taxes on business profits and personal incomes, higher tariffs (import taxes), continue to crush unions)-Warren G. Harding and Calvin Coolidge, both Republican presidents happy to oblige.

• “Never before, here or anywhere else, has a government been so completely fused with business.”

• Pres. Harding resumed practice of obtaining court injunctions to suppress strikes

The Twenties: Business and Government: Corruption in Government-The Harding Scandals

• President Warren G. Harding (1921-1925) “Return to Normalcy” after an entire era of Progressive Reform and World War I

• Reflecting the “Get Rich Quick” ethos of the era, Harding’s administration became one of the most corrupt ever in American history

• Harding surrounded himself with cronies who used public office for private gain

• Most notorious scandal was the “Teapot Dome” scandal-Sec’y of the Interior Albert Fall received $500,000 from private businessmen to whom he leased gov’t oil reserves at Teapot Dome, WY.


A 1924 cartoon commenting on the scandals of theHarding administration.

The TwentiesBusiness and Government: The Election of 1924

• President Calvin Coolidge continued President Warren G. Harding’s economic and social policies

• -elected in a landslide• -highly conservative decade• -pro-big business, anti-Progressive• -vetoed legislation to help farmers• -described Progressive ideas such as greater taxation of

the wealthy, conservation of natural resources, public ownership of the railroads, farm relief, and the end of child labor as “communistic and socialistic.”


The policies of President Calvin Coolidgewere music to the ears of big business

The TwentiesBusiness and Government: Economic Diplomacy

• 1920s reflected a retreat from Woodrow Wilson’s “Internationalism” toward “Isolationism”

• U.S. remained outside the League of Nations• Tariffs (taxes on imported goods) raised to highest levels

in history (cutting off American consumers from foreign goods)

• U.S. marines dispatched to Nicaragua to suppress a nationalist revolt that threatened U.S. economic interests (did not leave until 1933)

1920s America: The Birth of Civil Liberties—The Free Mob

• Wartime repression continued into the 1920s

• In 1922 the film industry adopted the Hays Code

• Even as some Europeans turned in increasing numbers to American popular culture and consumer goods, some came to view the country as a repressive cultural wasteland

1920s America: The Birth of Civil Liberties-The Court and Civil Liberties

• Oliver Wendell Holmes and Louis Brandeis began to speak up for freedom of speech

• The new regard for free speech went beyond political expression

• Anita Whitney was pardoned by the governor of California on the grounds that freedom of speech was the “indispensable birthright of every free American.”

1920s America: The Birth of Civil Liberties—A Clear and Present Danger

• The ACLU was established in 1920

• In its initial decisions the Supreme Court gave the concept of Civil Liberties a series of devastating blows

1920s America: The Culture Wars: The Fundamentalist Revolt

• Many evangelical Protestants felt threatened by the decline of traditional values and the increased visibility of Catholicism and Judaism because of immigration

• Convinced that the literal truth of the Bible formed the basis of Christian belief, fundamentalists launched a campaign to rid Protestant denominations of modernism

• (Billy Sunday)• Much of the press portrayed fundamentalism as a

movement of backwoods bigots• Fundamentalists supported Prohibition, while others

viewed it as a violation of individual freedom


Federal agents pour confiscated liquor intoa sewer in 1920

1920s America: The Culture Wars: The Scopes “Monkey” Trial

• Young teacher John Scopes was arrested for teaching evolution in school in TN

• Renowned labor lawyer Clarence Darrow defended Scopes

• Darrow examined William J. Bryan as an expert on the Bible

• Fundamentalists retreated for many years from battles over public education, preferring to build their own schools and colleges


Because of extreme heat, some sessions ofthe Scopes trial were held outdoors


The Anti-Evolution League selling itspublications outside the Tennessee

1920s America: The Culture Wars: The Second Klan

• Few features of urban life seemed more alien to small-town, native-born Protestants than immigrant populations and cultures

• Klan was reborn in Atlanta in 1915 after the lynching of Leo Frank, a Jewish factory manager accused of killing a teenage girl

• By the mid-1920s the Klan had spread to the North and West

1920s America: The Culture Wars: Closing the Golden Door

• Efforts made to restrict immigration from Europe and most other parts of the world

• In 1924, Congress permanently limited immigration for Europeans and banned it for Asians


The Only Way to Handle It, a cartoon endorsing immigration restriction.

1920s America: The Culture Wars-The Illegal Alien

• To satisfy the demands of large farmers in California who relied heavily on seasonal Mexican labor, the 1924 law established no limits on immigration from the Western Hemisphere

• The law established a new category of “illegal alien” and a new mechanism for enforcement, the Border Patrol

1920s America: The Great Depression-The Election of 1928

• Herbert Hoover seemed to exemplify what was widely called the new era of American capitalism

• Hoover’s opponent in 1928 was Alfred E. Smith of New York

• Smith’s Catholicism became the focus of the race


A 1928 campaign poster for the Republican ticketOf Herbert Hoover and Charles Curtis.

America in the 1920s: The Great Depression—The Coming of the Depression

• **On October 29, 1929, soon known as **Black Tuesday**, the stock market crashed.

• A panic ensured, and in *five hours* $10 billion in market value disappeared.

• The United States quickly found itself in the *Great Depression, the greatest economic calamity in modern history.**


Oct. 29—Dies Irae, a 1929 lithographby James N. Rosenberg


• Signals of impending disaster were visible before October 1929.

• Southern California and Florida had experienced spectacular real-estate booms and busts which resulted in failed banks and foreclosed mortgages.

• The highly unequal distribution of income and persistent depression in farming areas reduced Americans’ purchasing power.

• Sales of new autos and household consumer goods stagnated after 1926, and European demand for American goods also declined.


• A fall in the stock market bubble that had been created in the 1920s by speculators was inevitable, but when it happened, it was so severe that it destroyed many investment companies, wiping out thousands of investors and squelching consumer confidence.


• Around 26,000 businesses failed in 1930, and those that survived cut back on employment and investment.

The gold standard-based financial system could not effectively meet the downturn; Germany defaulted on its reparations payments to France and Britain, which in turn stopped repaying debts to the U.S.

• Banks failed throughout the world as depositors withdrew money, and millions of families lost their life savings.


• Stocks momentarily rebounded but soon resumed their precipitous decline.

• In 1932, the economy hit rock bottom, with GNP down by a third, prices down by 40 percent, and more than 11 million workers—25 percent of the labor force—unemployed. Those who had jobs faced reduced wages and hours.

• Every industrial economy suffered, but the United States was hit hardest.


• The Depression quickly transformed American’s lives, as hundreds of thousands took to the road to look for work, stood in bread lines, erected shack cities called “Hoovervilles,” and cities exhausted their poor relief.

• The Depression actually reversed the long-standing migration of Americans from farms to cities, as people tried to find land to grow food for their families.


• The suicide rate rose to its highest level in American history, and the birthrate dropped to its lowest. Also damaged was the public image of big business and Wall Street, which were shown to have thrived on the shady dealings, such as the sale of worthless bonds.


Unemployed men, lined up at the New YorkMunicipal Lodging House in 1930.


A Hooverville—a shantytown created byhomeless squatters—outside Seattle

America in the 1920s: The Great Depression—Resignation and Protest

• Many Americans responded to the Depression with resignation or blamed themselves for their economic woes.

• Others responded with protests that were at first spontaneous and lacking in coordination, because the unions, socialist groups and others that might have led them had been devastated in the 1920s.

• In early 1932, 20,000 unemployed World War I veterans who marched on Washington to demand early payment of a bonus due in 1945 were dispersed by federal troops.


Police battling “bonus marchers” in Washington,D.C., July 1932.

America in the 1920s: The Great Depression—Resignation and Protest

• Throughout America, demonstrations of the unemployed demanded work and relief. Farmers protested low prices by temporarily blocking roads to prevent goods from getting to market.

• The small Communist Party was the only group that seemed able to channel and direct the discontent. Communists formed unemployed councils that organized marches, demonstrated for public assistance, and opposed evictions of unemployed families.

• *The newspapers worried that America was close to revolution.*


Communist Party headquarters in NewYork City, 1932.

The 1920s-America and the Great Depression—Hoover’s Response

• To many Americans, President Hoover’s response to the Depression seemed inadequate and lacking in compassion. His advisors told him that depressions were a normal function of capitalism that removed uncompetitive firms and encouraged moral virtue among the unfortunate. Businessmen vehemently opposed federal assistance to the jobless and many suggested that individuals would survive the depression through thrift. Federal policymakers who had never faced an economic crisis of this magnitude did not realize how consumer spending supported much of the economy.

The 1920s-America and the Great Depression—Hoover’s Response

• Most did not believe that federal assistance to the unemployed would spur economic recovery. Hoover maintained his commitment to “associational action,” strongly opposed direct federal economic intervention, and believed that private charity and voluntary action by business to keep up investment and employment would suffice. He called together business and labor leaders and established commissions to encourage firms to coordinate maintaining prices and wages without government regulation. Hoover’s public reassurances that the economy was recovering clashed with reality and made him seem ignorant of the problems facing many ordinary Americans.


An unemployed man and woman sellingapples on a city street


The celebrated photographer Dorothea Lange took thisphotograph of an unemployed man on a San Francisco

The 1920s-America and the Great Depression—The Worsening Economic Condition

• Some of Hoover’s actions, such as the Hawley-Smoot Tariff, which raised already high taxes on imported goods, caused other nations to retaliate, and decreased international trade, exacerbated the crisis.

• A tax increase Hoover won from Congress in order to balance the budget further reduced consumers’ purchasing power.

• By 1932, even Hoover conceded that voluntary measures were insufficient.

• He signed laws creating the Reconstruction Finance Corporation, which loaned money to failing banks, railroads, and other businesses, and the Federal Home Loan Bank System, which gave aid to homeowners threatened with foreclosure.


• Although he had vetoed bills to create employment with public-works projects like road and bridge construction, he now approved $2 billion for such projects and local relief.

• But Hoover refused to do anything further, including direct aid to the unemployed which, he told Congress, would be a “disservice” to the jobless.


• In the mid-1920s, some intellectuals had worried that the prevailing notion of freedom in America celebrated unbound economic enterprise yet accepted limits on free speech and expression and other civil liberties.

• Though the prosperity of the 1920s reinforced this laissez-faire conception of freedom, the Great Depression and Hoover’s failed response discredited it.

Interesting websites

• The Scopes Trial:• www.law.umkc.edu/faculty/projects/ftrials/scopes/scopes.htm• (Part of the Famous Trials in American History series, this site

covers every aspect of the Scopes trial debate.)

• The Roaring Twenties:• http://users.snowcrest.net/jmike/20sdep.html• (This site is an excellent resource for links to relevant information on

1920s America.)

http://www.law.umkc.edu/faculty/projects/ftrials/scopes/scopes.htm

http://users.snowcrest.net/jmike/20sdep.html

chapter 20 from business culture to great depression: the twenties, 1920–1932

Documents

business of america

american history

business culture

country1920s america

poverty1920s america

decade of revolt

american people

new celebrity culture