STANDARD(S): 11.5 Students analyze the major political,

social, economic, technological, and cultural developments of the 1920s.

LESSON OBJECTIVES/ GOALS/ SWBAT

1. Summarize the impact of the automobile and other consumer goods on American life.

2. Explain how prosperity affected different groups of Americans.

3. Explain in what ways the country’s prosperity was superficial.

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American Industries Flourish

Coolidge’s Economic Policy• Calvin Coolidge favors minimal government

interference in business- allow private enterprise to flourish

The Business of America3SECTION

Continued . . .

SECTION 3: THE BUSINESS OF AMERICA

• The new president, Calvin Coolidge, fit the pro-business spirit of the 1920s very well

• His famous quote: “The chief business of the American people is business . . .the man who builds a factory builds a temple – the man who works there worships there”

President Calvin Coolidge 1924-1928

AMERICAN BUSINESS FLOURISHES

• Both Coolidge and his Republican successor Herbert Hoover, favored governmental policies that kept taxes down and business profits up

• Tariffs were high which helped American manufacturers

• Government interference in business was minimal

• Wages were increasing

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American Industries Flourish

The Business of America3SECTION

Continued . . .

The Impact of the Automobile• Cars change life—paved roads, gas stations, motels,

shopping centers• Give mobility to rural families, women, young people• Workers live far from jobs, leads to urban sprawl

(spread of cities)• Auto industry economic base for some cities, boosts

oil industry• By late 1920s, 1 car for every 5 Americans

IMPACT OF THE AUTOAmong the many changes

were:• Paved roads, traffic lights• Motels, billboards• Home design• 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.

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

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.

Urban Sprawl

Chapter 12 Section 3

• A – What was the impact of the automobile?– Roads were paved and shopping centers and

other services for cars were built’ – People commuted to work, and urban sprawl

developed;– Regional differences diminished

• B – How did the widespread use of the automobile affect the environment and the lives of Americans?– It changed the American landscape through

construction of paved roads.– It liberated the isolated rural family.– And it allowed workers to live miles away from

their jobs.

Invention or Trend

Effects of the Invention or Trend Company or Product

Automobiles:

Helped the economy to boom; spurred the building of paved

roads, service stations, garages, and so on;

changed architectural styles; gave people greater freedom to

travel; reduced the isolation of farm life; led to urban· sprawl; gave Americans a new status

symbol.

Model T Ford

Guided Reading

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continued American Industries Flourish

The Young Airplane Industry• Airplane industry starts as mail service for U.S.

Post Office• Weather forecasting begins; planes carry radios,

navigation tools• Lockheed Company produces popular transport

plane of late 1920s• 1927, Pan American Airways inaugurates

transatlantic flights

3SECTION

AIRLINE TRANSPORT BECOMES COMMON

• The airline industry began as a mail carrying service and quickly “took off”

• By 1927, Pan American Airways was making the transatlantic passenger flights

When commercial flights began, all flight attendants

were female and white

Invention or Trend

Effects of the Invention or Trend Company or Product

Airplane industry

Established a new means of transportation for people and goods;

gave people greater-freedom to travel

Lockheed Company

Guided Reading

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3SECTION

Incomes Grow• Average annual income rises over 35%, from

$522 to $705

America’s Standard of Living Soars

Continued . . .

AMERICAN STANDARD OF LIVING SOARS

• The years 1920-1929 were prosperous ones for the U.S.

• Americans owned 40% of the world’s wealth

• The average annual income rose 35% during the 1920s ($522 to $705)

• Discretionary income increased

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3SECTION

America’s Standard of Living Soars

Continued . . .

Electrical Conveniences• Factories use electricity to run machines• Development of alternating current gives

electricity to suburbs• By end of 1920s, more homes begin to have

electrical appliances• Appliances make housework easier, free women

for other activities• Appliances coincide with trend of women working

outside home

ELECTRICAL CONVENIENCES

• While gasoline powered much of the economic boom of the 1920s, the use of electricity also transformed the nation

Electric refrigerators, stoves, irons, toasters, vacuums, washing machines and sewing

machines were all new

• C – How did the use of electricity affect Americans’ lifestyle?– It transformed the nation. Factories used

electricity to run their machines. – Electricity could now be transmitted to the

countryside.– Well-to-do families had electric refrigeration,

cooking ranges, and toasters.

Invention or Trend

Effects of the Invention or Trend Company or Product

Alternating electrical current;

Made it possible to distribute electric power over greater areas;

led to the electrification of homes and widespread use of electrical appliances;

made housewives' work easier, freeing them for other activities;

led to· more Uniform, conformist lifestyles;

helped the economy to boom

Electric refrigerator

Guided Reading

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continued America’s Standard of Living Soars

The Dawn of Modern Advertising• Advertising agencies hire psychologists to learn to

appeal to public• Make brand names familiar nationwide; push

luxuries as necessities• Businesspeople work with service groups

- promote selves as benefactors of society

3SECTION

MODERN ADVERTISING EMERGES• Ad agencies no longer

sought to merely “inform” the public about their products

• They hired psychologists to study how best to appeal to Americans’ desire for youthfulness, beauty, health and wealth

MODERN ADVERTISING EMERGES• “Say it with Flowers”

slogan actually doubled sales between 1912-1924

Invention or Trend

Effects of the Invention or Trend Company or Product

Advertising: Created greater demand for consumer goods;

increased sales and profits; turned luxury items into necessities; helped the economy to boom

Listerine

Guided Reading

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A Superficial Prosperity

Producing Great Quantities of Goods• Most Americans believe prosperity will last forever• Productivity increasing, businesses expanding• Mergers in auto industry, steel, electrical

equipment, utilities• Chain stores develop; national banks allowed to

create branches• Income gap between workers, managers grows• Iron, railroad industries not prosperous; farms

suffer losses

3SECTION

Continued . . .

A SUPERFICIAL PROSPERITY

• Many during the 1920s believed the prosperity would go on forever

• Wages, production, GNP, and the stock market all rose significantly

• But. . . .

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continued A Superficial Prosperity

Buying Goods on Credit• Installment plan—pay for goods over extended

period with interest• Banks provide money at low interest rates• Some economists, business owners think

installment buying excessive• Think is sign of fundamental weakness behind

superficial prosperity

3SECTION

Invention or Trend

Effects of the Invention or Trend Company or Product

Installment plan:

Helped the economy to boom; helped to create a false sense of

prosperity; allowed people to buy goods over

an extended period of time without having to put up much money at a time of purchase

Automobiles

Guided Reading

PROBLEMS ON THE HORIZON?

• Businesses expanded recklessly

• Iron & railroad industries faded

• Farms nationwide suffered losses due to overproduction

• Too much was bought on credit (installment plans) including stocks

• D – What were the main advantages and disadvantages of buying on credit?– Advantage: people could buy goods they

could not otherwise afford.– Disadvantage: People could go far into debt

without realizing it.

• E – How do you think the changes in spending will affect the economy?– The economy may falter when consumers are

unable to meet their credit obligations.

Note 3 things that were, or might have been, seen as “clouds in the blue skies of prosperity” (warning signs).

Losses suffered by farmers and mining companies

The possibility that installment buying was getting out of band and that it represented a superficial prosperity.

Lack of true prosperity in the iron and railroad industries

A growing income gap between workers and managers

Guided Reading