1. The Business of America
12.3 Notes

2. Calvin Coolidge’s “pro-business spirit” of the 1920’s
“The chief business of the American people is business…the man who builds a factory builds a temple – the man who works there worships there”
Calvin Coolidge’s “pro-business spirit” of the 1920’s

3. American Industry Soars
Favored low taxes, high profits
Give business more credit to expand
Minimal gov’t involvement
High tariffs on imports – helped US manufacturers
Wages and productivity rising – new technology
1920 – 1929 – 40% of world wealth in U.S.

4. The Automobile Changed American landscape
All-weather paved roads
Route 66 – Chicago to CA
Houses with garages, carports
Gas stations, repair shops, public garages, motels, shopping centers
Liberated isolated rural families – urban sprawl
Vacations
Economic base – Detroit
Status symbol

6. Popularity of the Automobile
Two Factors
1. Cost-- Price of
automobiles declined
until the mid-1920s.
Well-paid working
families could now
afford to purchase a car.
2. Credit-- In 1925,
Americans made 75% of all automobile purchases on the installment plan.
The Model T Ford cost just $290 in 1926.

7. Airplane Industry Began as mail carrying service for U.S. post office
Developed weather forecasting
Radios, navigating tools
Transatlantic Flights
Amelia Earhart – disappeared
Charles Lindbergh – successful
1927 – Pan American Airways – 1st transatlantic passenger flights

8. Electrical Conveniences
Annual income – from $522 to $705
Electricity used to run industry machines
Alternating electrical current
Electricity distributed farther to suburbs
Farms still lacked power
Irons, refrigerators, toasters

9. Prices for Goods, 1928 Washing Machine = $150 Vacuum Cleaner = $50
Electric Sewing
Machine = $60

10. Advertising Grows Psychologists hired to study people’s desires
Youth, beauty, health, wealth
Luxury items become “necessities”
Flowers – “say it with flowers”
Cigarettes – “reach for a Lucky instead of a sweet”
Mouthwash – Listerine and fear of bad breath

11. Superficial Prosperity
Believed prosperity would go on forever
$87 billion national income by 1929
Stock market booming – investments
Increased productivity = business expansion
Mergers, chain stores, Woolworth’s
Income gap growing as well
Iron, railroad, farmers suffering losses

12. Credit Easy credit to purchase luxuries Installment plan
Buying goods over an extended period of time
Put down only a little amount of $
Low interest rates
“you furnish the girl, we’ll furnish the home”
Economists worried buying on credit was getting out of hand
Superficial prosperity