1. The Postwar Economy Booms
Topic 5-4
The Postwar Economy Booms

2. Objectives
Describe the economic problems America faced after World War I.
Explain the economic growth and prosperity of the 1920s, including how Henry Ford and the automobile industry helped spark the boom.
Analyze the consumer revolution and the bull market of the 1920s.
Compare the different effects of the economic boom on urban, suburban, and rural America.

3. Postwar Issues Questions following the war-
How can the US transition back to a peace time economy?
How can the returning veterans reintegrate into society and the work force?
How much involvement should the government have in world affairs?
What position should women and minorities play in the post WWI US?

4. Postwar Social Changes
End of the war= end of war time economy
Created a small recession and competitive job market
Working women expected to give up their jobs
Returning veterans came home looking for jobs and housing
Clashed with African Americans in northern cities (GREAT MIGRATION!)
Resulted in race riots across the north during summer 1919 (Chicago, St. Louis, DC etc.)

5. Rioters burned the homes of African Americans in Tulsa, Oklahoma, during race riots in 1921.

6. The Growth of Industry Automobile industry
Model T was the 1st car developed by Henry Ford
Used assembly line production to mass produce
Used scientific management to improve production efficiency
12 hours to 90 minutes
1908- $850
1927- $290 (56% of Americans owned a car compared to 10% in 1919)
Henry Ford shortened workday to 8 hours from 9 hour
More than doubled wages to $5 a day from $2.35
Gave Saturday and Sunday off to retain and not lose workers
Work was repetitive and dull for workers

8. The growth of industry Car culture impacted other industries
Growth of industries needed for car production (steel, rubber, petroleum etc.)
Prompted construction of numbered (white shield) highway system in 1926
Billboards, Drive-in Restaurants, Gas Stations & Motels constructed
Rural/suburban areas were able to connect to urban areas
Led to an increase in sense of independence

9. Analyze Maps How did the creation of an affordable car affect the development of roads in the United States?

10. Consumerism and economic hardship
1920s= Consumer revolution
Workers’ wages rose, people looked to buy affordable goods
Advertising prompted people to want new goods
Cars, houses, mixers, food grinders, sewing machines, vacuum cleaners, washing machines, refrigerators, irons & radios

12. Consumerism and economic hardship
Installment Buying
Consumer would make a small down payment, then pay the rest off in monthly payments
Bull Market
Period of rising stock prices
1929: 4 million Americans owned stock
Bear Market
Period of falling prices
Margin Buying
Another form of buying on credit – 10% of stock price

13. Analyze Charts What happened to the average stockholder’s wealth during the 1920s?

14. Consumerism and economic hardship
Industrial wages rose at a much slower rate than corporate salaries (rich getting richer)
Growth of suburbs for middle and upper classes
Farmers suffered from growing debt and falling farm prices
Couldn’t afford new products