In 1920s, the basic foundation of American civilization transformed into a new society. It was famously known as “The Jazz Age”, or “The roaring Twenties”. With the booming economy, most of the americans income rose which resulted in higher standard of loving, along with the escalation of consumer expenditure.
The automobile industry was the backbone of 1920s economy, Henry Ford implication of mass production, and standardization boost the industry, making all the car basically similar with mass production. This innovation made car more affordable for most of the Americans, in fact, “Annual automobile production tripled during the 1920s, from 1.2 to 4.
8 million”(GML, 820). Growth of automobile industry engendered magnification of ” steel, rubber, and oil production, road construction, and other sectors of the economy. It promoted tourism and the growth of suburbs and helped reduced rural isolation”(GML,820). During 1920s, consumption goods were started producing in mass, from automobiles to household appliances, with the advancement in marketing strategies and advertisement, they were able to sell goods in mass. “frequency purchased in credit through new installment buying plans, they rapidly altered daily life. Telephones made communication easier. Vacuum cleaners, washing machine, and refrigerators transformed work in the home and reduced the demand for domestic servants”(GML,821).
Increase in the household income, Americans started going on vacation, movies. “By 1929, weekly movie attendance had reached 80 million, double the figure of 1922. Hollywood films now dominated the world movie market” (GML,821). Invention of radios and phonographs brought movies and music into the Americans’ households, this created new celebrity cultures. Moreover, brand such as Coca-Cola started using celebrity to promote and advertise their products. ” The stock markets reached the apex of its swift climb, crashed, and brought an abrupt end to the seeming prosperity of the Roaring Twenties, The Great Depression had arrived” (AY).
There was a presidential election going on during that time, between Herbert Hoover (the Iowan born, son of a blacksmith and his school teacher wife, was from Republican candidate) and Alfred E. Smith ( Democratic opponent with catholic religious background). From what I believe, smith lost the presidential election because of his religious background and of course there were many other reasons. On Oct. 21, 1929, President Hoover traveled to Michigan to pay tribute to Thomas Edison for his lightbulb invention 50 years before. After eight days, on October 29, 1929, ” Black Tuesday”, American Stock markets shattered record low. As panic selling started, ” more than $10 billion in market value (equivalent to more than ten times that amount in today’s money) vanished in five hours” (GML,849). Soon after, not just our country, perhaps, the whole world had experienced the wave of the Great Depression.
It was not just the stok market crash that caused the depression, the bullet was triggered long before that. Some irresponsible banking in the 1920s, a time what was known as “Laissez-faire economics”, which kind of said the government was to keep its hands out of the economy. Laissez- faire in French means- let them do what they will, which in short, let the economy do whatever it wants, introduction of 1930’s Hawley-Smoot Tariff, which raised the tariff by over 60%, thereby, narrowing the international trade. Furthermore, “southern California and Florida experienced frenzied real-estate speculation and then spectacular busts, with banks failing, and land remaining undeveloped, mortgages foreclosed” (GML,849).
In addition to that, there was huge discrepancies in the income distribution among the population. With decrease in the demand of agriculture goods, and production continuing in the same manner as before. Thus, farmers were debt ridden, unable to pay loans taken from the banks. “By 1929, farm families were overextended, in no to make up for declining consumption, and in a precarious economic position even before the depression wrecked the global economy”(AY,6). More than 26,000 businesses were bankrupted in 1930. The businesses or companies that somewhat withstand The Great depression ” cut back on further investment and began laying off workers”(GML,849).
In 1932, the economy hit all-time low. GNP ” had fallen by one third, prices by nearly 40%”(GML,850). Around 11 millions fellow Americans, out of which 25% from labor force were unemployed and could not find any job. The New York Municipal lodging House, which was originally built for homeless to provide food and shelter was filled with unemployed men. “Thousands of families, evicted from their homes, moved into ramshackle shanty towns dubbed Hooverville, that sprang up in parks and on abandoned land”(GML,850). The Depression caused people to move back to farm to grow their own food.