TAKS Objective 3 The US Economy through the Roaring Twenties and the Great Depression

The US Economy in the 1920s  Rapid Growth From Improved Efficiency Henry Ford Henry Ford Developed the Model T in the early 1900sDeveloped the Model T in the early 1900s Introduced the assembly line in 1913.Introduced the assembly line in Each worker performs a small task adding a part to the car Each worker performs a small task adding a part to the car Conveyor belt moved it to the next worker until it was completed Conveyor belt moved it to the next worker until it was completed Required less skill and was much faster Required less skill and was much faster Able to build more cars in less time, and lower pricesAble to build more cars in less time, and lower prices

The US Economy in the 1920s  Consumer Spending Installment plans Installment plans Introduced in stores which allowed shoppers to pay over time rather than all at once (credit)Introduced in stores which allowed shoppers to pay over time rather than all at once (credit) Made it easier for working families to buy household appliances and other goodsMade it easier for working families to buy household appliances and other goods

The US Economy in the 1920s  Consumer Spending Advertising Advertising Encouraged people to buy productsEncouraged people to buy products Increased demandIncreased demand Companies had to manufacture more goods to keep up Companies had to manufacture more goods to keep up More manufacturing = more jobs and higher wages = more money was available to buy goods More manufacturing = more jobs and higher wages = more money was available to buy goods

The US Economy in the 1920s  Investing in the Stock Market Stock prices climbed as more people invested Stock prices climbed as more people invested Companies offered more shares to the public to generate capital Companies offered more shares to the public to generate capital Money that companies invest in their businessMoney that companies invest in their business Americans borrowed money to buy stock Americans borrowed money to buy stock Thought it would continue to rise and pay it offThought it would continue to rise and pay it off October 29, 1929 – Stock Market Crash Affected nearly every company whose stock was traded Started a chain reaction that caused the failure of thousands of banks Lead to the Great Depression

The Great Depression:  How it Affected the US Standard of Living Businesses closed Businesses closed Led to…Led to… Increased unemployment Increased unemployment ¼ of all workers in the US¼ of all workers in the US Drop in production Drop in production Decrease in prices Decrease in prices Standard of living fell drastically Standard of living fell drastically Many lost their homesMany lost their homes Farmers…Farmers… In debt because of farm equipment In debt because of farm equipment Could not pay as crop prices fell Could not pay as crop prices fell

The Great Depression:  Dust Bowl Severe drought across the Great Plains states from Severe drought across the Great Plains states from Poor farming practices exhausted the soil Poor farming practices exhausted the soil Causes erosionCauses erosion Winds blew top soil causing dust stormsWinds blew top soil causing dust storms Farmers forced to leave their farms Farmers forced to leave their farms Most went to California to find workMost went to California to find work

The Great Depression:  The New Deal Franklin D Roosevelt becomes President in 1933 Franklin D Roosevelt becomes President in 1933 Expanded the role of government in dealing with the depressionExpanded the role of government in dealing with the depression His policies were called the New Deal His policies were called the New Deal Much of these are still around todayMuch of these are still around today

The Great Depression: New Deal Policies… New Deal Policies… Supported the right of workers to form labor unionsSupported the right of workers to form labor unions Restricted the number of hours of work required for workersRestricted the number of hours of work required for workers Insured bank deposits to protect savingsInsured bank deposits to protect savings Aided farmers by stabilizing crop pricesAided farmers by stabilizing crop prices Provided electricity to rural areasProvided electricity to rural areas Set new rules to prevent abuses in the stock marketSet new rules to prevent abuses in the stock market Created Social Security for retired workersCreated Social Security for retired workers Also Public Works Projects Building bridges Fighting fires Planting trees Poor were given financial aid to pay for food and shelter

The Great Depression:  New Deal Programs: Federal Deposit Insurance Corporation (FDIC) Federal Deposit Insurance Corporation (FDIC) Insured bank depositsInsured bank deposits Securities and Exchange Commission (SEC) Securities and Exchange Commission (SEC) Established regulations for the Stock MarketEstablished regulations for the Stock Market Civilian Conservation Corps (CCC) Civilian Conservation Corps (CCC) Provided jobs for 2 million unemployed men to create national parksProvided jobs for 2 million unemployed men to create national parks Public Works Administration (PWA) Public Works Administration (PWA) Funded construction of roads, bridges, libraries, courthouses, etc.Funded construction of roads, bridges, libraries, courthouses, etc. Tennessee Valley Authority (TVA) Built dams to provide electricity and flood control Social Security Act Established retirement pensions and unemployment insurance, and welfare Works Progress Administration (WPA) Hired people to construct highways, airports, and public buildings Hired actors, writers, artists and musicians to work

The Great Depression:  WWII Finally lifted the US out of the Depression Finally lifted the US out of the Depression Created strong demand for weapons and suppliesCreated strong demand for weapons and supplies Factories that had before made consumer products now made weaponsFactories that had before made consumer products now made weapons Eligible men joined the military Eligible men joined the military Women filled factory jobs Women filled factory jobs

The Great Depression:  WWII Farmers Farmers Economic situation improved as demand for food increasedEconomic situation improved as demand for food increased New technologies New technologies RadarRadar Jet enginesJet engines Nylon and other synthetic fibersNylon and other synthetic fibers Technologies also had commercial uses after the war Technologies also had commercial uses after the war Europe in ruins after warEurope in ruins after war High foreign demand for US productsHigh foreign demand for US products