Ch 16 Notes
20s Presidents- Harding- “return to normalcy” (the way things were before the war)
- scandals/corruption
- Cooledge next
- Both Republican, neither do much and the country likes it that way because the economy is great (if it ain’t broke, don’t fix it)
Economy
Henry Ford
- applied the assembly line to car making, divided car making into several simple tasks
- faster = cheaper product
- car = Model T, tons of them built, sold cheap
- Causes increase in steel, rubber, oil, glass industries. Also: roads need to be built
Home Inventions
- indoor plumbing
- electric razors, vacuum cleaners, washing machines, refrigerators
- personal hygiene products (electric razors, etc)
$
- credit, buy now, pay later
- very easy to get, many people increase their personal debt
- welfare capitalism- companies let employees get stock, insurance, retirement, other benefits
1. an effort to keep their employees from forming unions
Farm Crisis
- prices ↓, why?↓ ↑
-
WWI-
o demand
↑ to sell to military and
o farmers
buy new land to make more $, also machines to help farm it (on credit)
-
War Ends
o Demand
↓ but supply still ↑, causes prices to ↓ but farmers
production is still high
o Farmers
can’t pay off loans, many lose their farms
-
Bottom line, farmers overproduced and caused the prices
to be so low
-
Gov’t- Congress proposes
buying extra grain to sell overseas, but President vetoes it
Andrew Mellon- Sec of Treasury during the 20s
- plan- 1. Cut taxes, 2. balance budget, 3. reduce gov’t debt
- supply side economics
o cutting income taxes gives people more money in their pockets
o they will then spend that extra money which will benefit businesses
o businesses will make $ and pass it on to employees as higher wages
o Result- the gov’t makes more in income taxes because the rate of income increase is higher that the tax decrease
Foreign policy
- isolationism- many Americans want it, stay out of foreign stuff (leave us alone)
o realistically, can’t do it, we have to/want to trade w/ others
o we are out of L of N
-
o Dawes
Plan- US will loan $ to
1. also Eng/Fr pay back more debt’
2. doesn’t work as well as planned, causes too many debtors
Washington Conference- countries to discuss military reduction
- 4 power treaty-
o
o Agree to not attack each others possessions in the Pacific
- 5 power treaty-
o Eng,
o Agree to regulate naval size in proportion to each other (US, Eng get the most)
- 9 power treaty-
o 9
countries agree that
Kellogg-Brian Pact
- bunch of countries agree to outlaw aggressive war
- no way to enforce it