Ch The Affluent Society America in the 1950’s Part 1

America after the War Celebration…. and DEMOBILIZATION 1945 – 12m military m military

Demobilization War industries convert to peace production –Autos, TV's, household appliances, cameras War-time price controls/rationing removed –Prices rise Increased demand –Inflation sky rockets –Labor Strikes (5 million strikers 1946) Truman’s Fair Deal –Taft-Hartley Act Limits union power Many women exit the labor market

The Economy Grows in the 50’s “Real Income – up 20%

Consumer Society 1950’s We were 6% of the world’s population, producing and consuming 50% of the world’s products.

Why were the 50’s so prosperous? Rise in real income/savings from WWII “Pent-up” demand –Little consumer spending WWII/Great Depression New Technologies GI Bill

GI Bill of Rights Servicemen's Readjustment Act of 1944 Provides funds for education for Veterans –an estimated 2.2 million veterans received education at colleges and universities –A total of 7.8 million veterans, or 50.5 percent of the World War II veteran population, received training or education under the bill.

GI Bill Funds Home Loans –Over 2 million loans by 1950 –Housing starts: , million Home ownership increases to 62% of the population by 1960

New Jobs “White collar” jobs –Big Business –Finance –Advertising (mostly white and male) Service Industry –Insurance –Transportation –Retail –Hospitality MacDonald’s Holiday Inns –Service and repair workers (service jobs > manufacturing jobs) –A shift from producing goods to providing services

Why were the 50’s so prosperous? “Bigger is Better” efficiencies in industry –IBM sales grow 10x between –GM doubles its assets to $2.8 billion in 1960 Conglomerates-large companies with holdings in unrelated industries, brought about by business mergers –benefit: company could grow without violation of anti-trust law –Example: General Electric, Berkshire-Hathaway, Time-Warner, Phillip-Morris

Farms Become Big Business Small family farms replaced by agribusiness corporations. –Cost efficiencies on larger farms –Expense of new technologies –Pesticide/Synthetic fertilizers 1940 to 1960 –Farm size doubles –Total farms: 6 million to 4 million (2.3 million now) –Farm population: 30 million to 13 million

Mobility Post-war shifts in population –To “Sunbelt” –Rural to Urban (20% of American moved each year of the 50s) The “Automobile Culture” –58 million cars purchased during the 1950s –Highway Act of 1956 $32 billion to build 40,000 miles of roads Interstate Highway System

Supporting Businesses

Suburbia Small, mass-produced homes that the middle-class can afford

“Sunbelt” Growth

Part 2 Eisenhower in the White House

Eisenhower’s New Look Many Americans were ready for a change in leadership Truman did not run again Dwight D. Eisenhower vs. Adlai Stephenson (IL) Eisenhower won in a landslide (head of D- Day)

“More Bang for the Buck” Key to victory in Cold War was strong military and economy Had to show the world that free enterprise was better than communism Instead of maintaining a large and expensive army, the nation “must be prepared to use atomic weapons in all forms”

Massive Retaliation Eisenhower concluded that we could not win the war on communism by fighting a few small wars Best way was to threaten to use nuclear weapons (Massive Retaliation) Cut military spending from 50 to 34 billion Increased nuclear arsenal from 1,000 bombs to 18,000

The Sputnik Crisis B-52 bomber revealed that it could fly across continents and drop nuclear bombs anywhere in the world Could be shot down! Developed intercontinental ballistic missiles that could deliver bombs anywhere in the world

The Sputnik Crisis cont. At the same time Soviets had launched Sputnik, the first artificial satellite to orbit the earth Made the U.S. think we were falling behind the Soviets Developed NASA: National Aeronautics and Space Administration & National Defense for Education: funds for education and training in math, science, and foreign languages

Brinkmanship in Action There were critics to Eisenhower’s policies Critics called this brinkmanship: the willingness to go the brink of war to force the other side to back down---argued that this was too dangerous

The Korean War Ends Eisenhower promised to end the war in Korea Eisenhower was convinced that the ongoing battle was costing too many lives and bringing too few victories Quietly let China know that the U.S. “might continue the Korean War under circumstances of own choosing” –Hinting of a nuclear attack

The Korean War Ends cont. The threat of nuclear war was enough The battle line between the 2 sides, became the border between North Korea and South Korea A “demilitarized zone” (DMZ) separated them There was no victory, but the war had stopped the spread of communism in Korea-the goal of containment

The Taiwan Crisis Chinese nationalists still controlled Taiwan even though Chinese communist had taken over the mainland Communists threatened to take it from the nationalists Eisenhower warned the communists that the US would use nuclear weapons to stop an invasion and they back down

The Suez Crisis Middle East; Eisenhower’s goal was to prevent Arab nations from aligning with the Soviet Union To build support the U.S. offered to help Egypt finance the construction of a dam on the Nile River Egypt had bought weapons from Communist Czechoslovakia Had to withdraw offer Arab nations supported Communists

Fighting Communism Covertly To prevent communist uprisings in other countries, Eisenhower decided to use covert or hidden operations conduction by the CIA-Central Intelligence Agency Providing developing countries with financial aid Staged covert operations to overthrow anti-American leaders and replace them with pro-American leaders; although it didn’t always work and created more tensions

Continuing Tensions Nikita Khrushchev became leader of Russia “We will bury capitalism…Your grandchildren will live under communism” 1960 Khrushchev and Eisenhower were to meet at a summit: formal face to face meeting of leaders

Continuing tensions..cont. Before the summit was to begin, the Soviet Union shot down the American U-2 spy plane Soviets produced the pilot; Soviets wanted Eisenhower to apologize; refused Khrushchev called off the summit Eisenhower then left office