1. Presidential politics of the 1920s… Warren G. Harding Calvin Coolidge Herbert Hoover

2. Republican Ascendancy Republican victories in 1920s. – Progressive regulatory reform gave way to pro-business sentiment. “The business of America is business.” President Calvin Coolidge – Government placed in the hands of business.

3. ++ = $$ LAISSEZ FAIRE REPUBLICAN ECONOMY SUPPORTED LAISSEZ FAIRE AND BIG BUSINESS………. Lower Taxes Less Federal Higher Strong Spending Tariffs National Economy Fordney-McCumber Tariff---1923 Hawley-Smoot Tariff --- 1930 raised the tariff to an unbelievable 60%!!!

4. Warren G. Harding – Return to Normalcy after World War I Isolationism—avoided foreign alliances but… Called for Disarmament of European nations War Debts—Europe debts were scaled back to allow their economies to recover

5. The Harding Presidency- the Worst? Warren G. Harding’s modest successes include the Kellogg- Briand Pact which renounced war as a means of national policy (signed by fifteen nations, but difficult to enforce) the Dawes Plan which solved the problem of post-war debt by providing loans to Germany to pay France/Britain who then paid the U.S. Harding 1920-1924

7. Business and Politics of the 1920s Four main sources of the 1920s economic boom Taylorism Increase in worker productivity Automobiles! Psychology of consumption

8. Relations between Government and Big Business. High Tariff Policies Reduction of personal and corporate taxes. Less business regulation by the FTC. Government price fixing. Closed/open shop policy.

9. 1920s: Tough Times for Unions The 1920s hurt the labor movement. Union membership dropped from 5 million to 3.5 million. Why? African Americans were excluded from membership and immigrants were willing to work in poor conditions. Ford Foundry workers in 1926; only 1% of black workers were in Unions at the time.

10. An Economy in Transition Prosperous decade: – Unemployment under 5% – Paychecks increased, prices dropped. Economic transition from capital goods to consumer goods Consumption the key to prosperity.

11. Consumerism and Advertising Shift from stressing the product to stressing consumer desires – health, popularity, social status – a reliance on emotion Influence from World War I propaganda – passion and emotion Create fears and desires by centering message: – on the body – on control of the audience – advice from “specialists”

12. Psychology of consumption Radio (KDKA) Motion Pictures New Appliances Advertising

13. The Impact of the Auto The auto was the backbone of the American economy from 1920 through the 1970s. It also profoundly altered the American landscape and society. Available due to Cost and Credit (installment plan) The Ford Model T was the first car in America. It came only in black and sold for $290. Over 15 million were sold by 1927.

14. How Auto Changed America Paved roads, traffic lights, motels, billboards Home design (garages, driveways) Gas stations, repair shops, shopping centers Freedom for rural families Independence for women and young people Cities like Detroit, Flint, Akron grew By 1920 80% of world’s vehicles in U.S.

15. Herbert Hoover Followed Harding and Coolidge as business policy Efficiency movement – Experts find inefficiency and fix it – Increase volunteerism Stock Market Crashes Action for Farmers – Pushed for farm subsidies Started to regulate financial institutions

16. Herbert Hoover…Importance The "trickle down" economic theory of President Herbert Hoover was based on the idea that – 1. balanced budgets are essential to economic success. – 2. the Federal Government needs to assume more responsibility for solving economic problems. – 3. economic growth depends on making increased amounts of money available to business. – 4. economic stability is the responsibility of Federal monetary agencies.