Unit III – A Modern Unit III – A Modern NationNation

Chapter 9 Section 2Chapter 9 Section 2

A New Economic EraA New Economic Era

The Main Idea

New products, new industries, and new ways of doing business expanded the economy in the 1920s, although not everyone shared in the prosperity.

Reading Focus

What role did the Ford Motor Company and Henry Ford play in revolutionizing American industry?

How did both the auto industry and the nation change during the 1920s?

What were some qualities of the new consumer of the 1920s?

What were some weak parts of the economy in the 1920s?

A New Economic EraA New Economic Era

Henry Ford: Changing the Way Americans Worked, Played, and Traveled (02:42)Henry Ford: Changing the Way Americans Worked, Played, and Traveled (02:42)

2. Make the process smooth, using interchangeable parts and moving belts.

Ford Revolutionizes Ford Revolutionizes IndustryIndustry

3. Determine how workers should move, and at what speed, to be the most productive.

• The first cars appeared in the U.S. in the 1800s, but only the rich could buy them, until Henry Ford began selling the Model T in 1908.

• Ford’s vision combined three main ideas.

1. Make cars simple and identical instead of doing highly expensive custom manufacturing.

• These ideas formed the first large-scale moving assembly line, a production system in which the item being built moves along a conveyor belt to workstations that usually require simple skills.

• By the 1920s Ford made a car every minute, dropping prices so that by 1929 there were about 22 million cars in America.

• Ford raised his workers’ wages so they could also buy cars, but he opposed unions, and assembly lines were very boring.

Life in the Jazz Age - Life in the Jazz Age - AutomobileAutomobile

As the end of the decade neared, Ford and As the end of the decade neared, Ford and Chevrolet locked horns in a fierce pricing Chevrolet locked horns in a fierce pricing battle that continued through the Thirties. battle that continued through the Thirties. Other automakers, such as Cadillac, Packard, Other automakers, such as Cadillac, Packard, and Chrysler, began to have an impact on the and Chrysler, began to have an impact on the market.market.

Virtually every household in America owned Virtually every household in America owned an automobile, and it quickly became an an automobile, and it quickly became an integrated part of American life. Parents would integrated part of American life. Parents would drive to work in their automobiles. Families drive to work in their automobiles. Families could visit friends and family who lived farther could visit friends and family who lived farther away. And young people found a whole new away. And young people found a whole new way to have fun. Entertainment and recreation way to have fun. Entertainment and recreation as well as work.as well as work.

A wide variety of new industries were A wide variety of new industries were spawned- petroleum, manufacturing, road spawned- petroleum, manufacturing, road construction, etc.construction, etc.

Automobile ProductionAutomobile ProductionMotor Vehicle Production (Thousands)

Year U.S.U.S. CanadaCanada FranceFrance U.K.U.K. GermanyGermany ItalyItaly CzechCzech RussiaRussia

1907 4545 33 2525 1212 44 00 00 00

1913 485485 1515 4545 3434 1414 22 00 00

1924 35043504 135135 145145 133133 1818 3535 22 00

1928 43594359 242242 210210 212212 9090 5555 1313 11

1935 39713971 173173 165165 404404 240240 4444 1010 9797

Ford Revolutionizes Ford Revolutionizes IndustryIndustry

What made it possible for Ford’s workers What made it possible for Ford’s workers to be able to buy cars themselves?to be able to buy cars themselves?

Why was Henry Ford’s Model T such a Why was Henry Ford’s Model T such a revolutionary idea?revolutionary idea?

How did the assembly line both benefit How did the assembly line both benefit and hurt workers?and hurt workers?

The Effects on IndustryThe Effects on Industry• The Ford Motor Company dominated auto making for 15

years, but the entire industry grew when competitors like General Motors and Chrysler tried to improve on Ford’s formula by offering new designs, starting competition.

• Other industries learned from Ford’s ideas, using assembly-line techniques to make large quantities of goods at lower costs, raising productivity, or output, by 60 percent.

• The success of businesses led to welfare capitalism, a system in which companies provide benefits to employees to promote worker satisfaction and loyalty.

• Many companies offered company-paid pensions and recreation programs hoping employees would accept lower pay, which many did.

Car Effects

• Demand for steel, rubber, glass, and other car materials soared.

• Auto repair shops and filling stations sprang up.

• Motels and restaurants arose to meet travelers’ needs.

• Landowners who found petroleum on their property became rich.

Cities and Suburbs

• Detroit, Michigan, grew when Ford based his plants there, and other automakers followed.

• Other midwestern cities, like Akron, Ohio, boomed by making car necessities like rubber and tires.

• Suburbs, which started thanks to trolley lines, grew with car travel.

Industry Changes SocietyIndustry Changes SocietyTourism

• Freedom to travel by car produced a new tourism industry.

• Before the auto boom, Florida attracted mostly the wealthy, but cars brought tourists by the thousands.

• Buyers snatched up land, causing prices to rise.

• Some Florida swamps were drained to put up housing.

Industry Changes SocietyIndustry Changes Society

How did the Auto industry and the nation How did the Auto industry and the nation change during the 1920’s?change during the 1920’s?

What new industries developed as a result of What new industries developed as a result of automobiles?automobiles?

How did the growth of the automobile industry How did the growth of the automobile industry affect the American lifestyle?affect the American lifestyle?

Why did Henry Ford and other automakers Why did Henry Ford and other automakers choose the Detroit, Michigan, area for their choose the Detroit, Michigan, area for their center of operations?center of operations?

The New ConsumerThe New Consumer

Creating Demand

• Advertisers became the cheerleaders of the new consumer economy.

• Persuasive advertising gained a major role in the economy.

• Advertisers paid for space in publications, and companies sponsored radio shows.

• Advertising money made these shows available to the public, and ads gave the products wide exposure.

• During the 1920s, an explosion of new products, experiences, and forms of communication stimulated the economy.

New Products

• New factories turned out electrical appliances like refrigerators and vacuum cleaners, as more homes were wired for electricity.

• The radio connected the world, and by the late 1920s, 4 homes in 10 had a radio, and families gathered around it nightly.

• The first passenger airplanes appeared in the 1920s, and though they were more uncomfortable than trains, the thrill excited many Americans.

The RadioThe Radio Most radio historians assert that radio Most radio historians assert that radio

broadcasting began in 1920 with the historic broadcasting began in 1920 with the historic broadcast of KDKAbroadcast of KDKA

Radio became a product of the mass marketRadio became a product of the mass market

Between 1923 and 1930, 60 percent of American Between 1923 and 1930, 60 percent of American families purchased radios. Families gathered families purchased radios. Families gathered around their radios for night-time entertainmentaround their radios for night-time entertainment

Radio stations broadcast things like popular Radio stations broadcast things like popular music, classical music, sporting events, lectures, music, classical music, sporting events, lectures, fictional stories, newscasts, weather reports, fictional stories, newscasts, weather reports, market updates, and political commentary.market updates, and political commentary.

The Federal Radio Commission was set up in The Federal Radio Commission was set up in 1926; the Radio Act of 1927 organized the 1926; the Radio Act of 1927 organized the

Federal Radio Commission.Federal Radio Commission. Crystal radios, like the one at left, were among Crystal radios, like the one at left, were among

the first radios to be used and manufactured.the first radios to be used and manufactured.

The PhonographThe Phonograph The phonograph or Victrola was The phonograph or Victrola was

developed as a result of Thomas Edison's developed as a result of Thomas Edison's work on two other inventions, the work on two other inventions, the telegraph and the telephone.telegraph and the telephone.

Uses of the Phonograph- according to Uses of the Phonograph- according to EdisonEdison Letter writingLetter writing dictation dictation Phonographic books, Phonographic books, The teaching of elocution. The teaching of elocution. Reproduction of music. Reproduction of music. The "Family Record"--a registry of sayings, reminiscences, The "Family Record"--a registry of sayings, reminiscences,

etc., by members of a family in their own voices, and of the etc., by members of a family in their own voices, and of the last words of dying persons.last words of dying persons.

Music-boxes and toys. Music-boxes and toys. Clocks Clocks The preservation of languages The preservation of languages Educational purposes. Educational purposes. Connection with the telephoneConnection with the telephone

RefrigeratorsRefrigerators Two of the first home refrigerators both appeared in Fort Two of the first home refrigerators both appeared in Fort

Wayne, Indiana, where, in 1911, General Electric company Wayne, Indiana, where, in 1911, General Electric company unveiled a unit invented by a French monk. In 1915 the first unveiled a unit invented by a French monk. In 1915 the first "Guardian" refrigerator - a predecessor of the Frigidaire - "Guardian" refrigerator - a predecessor of the Frigidaire - was assembled in a wash house in a Fort Wayne backyard. was assembled in a wash house in a Fort Wayne backyard.

Kelvinator and Servel models were among some two dozen Kelvinator and Servel models were among some two dozen home refrigerators introduced to the U.S. market in 1916. home refrigerators introduced to the U.S. market in 1916. In 1920 the number had increased to more than 200. In 1920 the number had increased to more than 200. Compressors were generally driven by belts attached to Compressors were generally driven by belts attached to motors located in the basement or in an adjoining room. motors located in the basement or in an adjoining room.

In 1918 Kelvinator introduced the first refrigerator with In 1918 Kelvinator introduced the first refrigerator with any type of automatic control. One manufacturer's 1922 any type of automatic control. One manufacturer's 1922 model had a wooden cabinet, a water-cooled compressor, model had a wooden cabinet, a water-cooled compressor, two ice cube trays and nine cubic feet of storage space. It two ice cube trays and nine cubic feet of storage space. It cost $714. In 1923 Frigidaire introduced the first self-cost $714. In 1923 Frigidaire introduced the first self-contained unit. Steel and porcelain cabinets began contained unit. Steel and porcelain cabinets began appearing in the mid-20s.appearing in the mid-20s.

Washing machinesWashing machines In 1922 The Maytag Company introduced a system of forcing In 1922 The Maytag Company introduced a system of forcing

water through the clothes by means of an agitator rather water through the clothes by means of an agitator rather than dragging the clothes through the water. This system is than dragging the clothes through the water. This system is most commonly used now. most commonly used now.

Even as early as 1875 there had been more than 2,000 patents Even as early as 1875 there had been more than 2,000 patents issued for various washing devices. Not every idea worked, of issued for various washing devices. Not every idea worked, of course. One company built a machine designed to wash only course. One company built a machine designed to wash only one item at a time. one item at a time.

What may have been the first "laundromat" was opened in What may have been the first "laundromat" was opened in 1851 by a gold miner and a carpenter in California. Their 12-1851 by a gold miner and a carpenter in California. Their 12-shirt machine was powered by 10 donkeys. shirt machine was powered by 10 donkeys.

Earliest washers were hand powered by means of a wheel, Earliest washers were hand powered by means of a wheel, pump handle or similar device. One, was driven by twisted pump handle or similar device. One, was driven by twisted ropes which powered the washer by "unwinding" somewhat ropes which powered the washer by "unwinding" somewhat like the use of a rubber band to power model airplanes. One like the use of a rubber band to power model airplanes. One washer contained rollers which were pushed back and forth washer contained rollers which were pushed back and forth by hand to squeeze out dirt. Several featured "stomping" by hand to squeeze out dirt. Several featured "stomping" devices and one - called a "Locamotive" was moved rapidly devices and one - called a "Locamotive" was moved rapidly back and forth on a track washing the clothes by slamming back and forth on a track washing the clothes by slamming them against the walls of the tub.them against the walls of the tub.

Vacuum CleanersVacuum Cleaners In 1907 an American named James Murray Spangler, In 1907 an American named James Murray Spangler,

who was working as a cleaner, Designed the first small who was working as a cleaner, Designed the first small electric cleaner. he sold the patent to a harness maker electric cleaner. he sold the patent to a harness maker named Hoover. By the 1920's Bothe started to produce his named Hoover. By the 1920's Bothe started to produce his own range of electric cleaners under the Goblin name. He own range of electric cleaners under the Goblin name. He had 2500 door to door sales representative's in England had 2500 door to door sales representative's in England selling mainly under hire purchase. Both the Hoover and selling mainly under hire purchase. Both the Hoover and the Goblin range were very successful and are still the Goblin range were very successful and are still operating today selling machines that have not changed operating today selling machines that have not changed much in basic design since their first prototype.much in basic design since their first prototype.

In 1908 Hoover introduced the Model O vacuum, the first In 1908 Hoover introduced the Model O vacuum, the first to use both a cloth filter bag and cleaning attachments. to use both a cloth filter bag and cleaning attachments. The machine weighed only 40 lbs. The machine weighed only 40 lbs.

Hoover developed positive agitation in 1926, and this Hoover developed positive agitation in 1926, and this greatly increased the dirt removal efficiency of the greatly increased the dirt removal efficiency of the vacuum. The Model 700 featured a rigid beater bar which vacuum. The Model 700 featured a rigid beater bar which was used in combination with the brush on the agitator to was used in combination with the brush on the agitator to dislodge dirt from the carpet. dislodge dirt from the carpet.

The New ConsumerThe New Consumer

What were some of the qualities of the new What were some of the qualities of the new consumer of the 1920’s?consumer of the 1920’s?

How did advertising change the American How did advertising change the American marketplace?marketplace?

How was the public hurt and helped by How was the public hurt and helped by advertisements?advertisements?

Do you think Americans would have bought as Do you think Americans would have bought as many appliances if they had not been many appliances if they had not been advertised?advertised?

New Ways To PayNew Ways To Pay In the early 1900s, most Americans paid for items in full when they

bought them, perhaps borrowing money for very large, important, or expensive items like houses, pianos, or sewing machines.

Borrowing was not considered respectable until the 1920s, when installment buying, or paying for an item over time in small payments, became popular.

They bought on credit, which is, in effect, borrowing money.

Consumers quickly took to installment buying to purchase new products on the market.

By the end of the decade, 90 percent of durable goods, or long-lasting goods like cars and appliances, were bought on credit.

Advertisers encouraged the use of credit, telling consumers they could “get what they want now” and assuring them that with small payments they would “barely miss the money.”

Natural Disasters

• Boll weevil infestations ruined cotton crops.

• The Mississippi River flooded in 1927, killing thousands and leaving many homeless.

• “The Big Blow,” the strongest hurricane recorded up to that time, killed 243 people in Florida.

Weaknesses in the EconomyWeaknesses in the Economy

Land Speculation• In Florida, the wild

land boom came to a sudden and disastrous end.

• Florida sank into an economic depression even as other parts of the nation enjoyed prosperity.

• Though the “Roaring Twenties” brought prosperity to many, other Americans suffered deeply in the postwar period

Farmers

• American farmers who had good times during World War I found demand slowed, and competition from Europe reemerged.

• The government tried to help in 1921 by passing a tariff making foreign farm products more expensive, but it didn’t help much.

Weaknesses of the EconomyWeaknesses of the Economy

What were some of the weak parts of the What were some of the weak parts of the economy in the 1920’s?economy in the 1920’s?

Why did American agriculture suffer after Why did American agriculture suffer after World War I?World War I?

How did low prices for crops affect How did low prices for crops affect farmers?farmers?