The 'Boom'

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Policy X was high tariffs on imported goods, introduced by the Fordney-McCumber Tariff of 1922. The tariff made foreign goods more expensive in American shops, so Americans bought American-made goods instead, protecting American companies from foreign competition and helping them to sell more and make bigger profits.

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One feature was the very rapid rise in share prices, especially at the end of the decade. The Dow Jones Industrial Average, which measured share prices on the New York Stock Exchange, rose from about 200 at the end of 1927 to 300 at the end of 1928 and reached a peak of about 381 in September 1929, far faster than companies' profits were growing.

A second feature was speculation using borrowed money. Many people bought shares not to keep them but to sell them quickly at a higher price, and they bought 'on the margin', paying a deposit of perhaps 10% and borrowing the rest from a stockbroker. Banks lent huge sums for this, so the boom was built on debt and would turn into disaster if prices fell, as they did in October 1929.

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Mass production brought factory workers both benefits and costs. The most obvious benefit was higher pay in the big modern firms. Ford's five-dollar day, introduced in 1914, roughly doubled the usual factory wage, and wages in many large modern factories rose during the 1920s. This meant that many industrial workers could, for the first time, afford to buy a car or a radio, often on hire purchase, so mass production made workers into consumers as well as producers. Hours were also shorter: Ford introduced an eight-hour day in 1914 and a five-day week in 1926, giving workers more leisure time.

However, the work itself became duller and harder to bear. On the moving assembly line each worker did one simple task over and over again, at a speed set by the line, not by the worker. Skilled craftsmen were no longer needed, so workers could easily be replaced, which made them feel insecure. Many found the work so monotonous and tiring that they quit; high labour turnover was the main reason Ford introduced the five-dollar day.

Workers also lost freedom. Foremen enforced strict discipline, talking on the line was discouraged, and Ford's Sociological Department checked workers' home lives to decide whether they deserved the higher wage. Employers like Ford opposed trade unions, and union membership fell during the 1920s, so workers had little power to improve conditions.

Overall, mass production raised the living standards of many workers, but at the cost of boring, tightly controlled work over which they had little say.

Model answer

The growth of the motor industry had a huge effect on other industries. Car registrations rose from about 8 million in 1920 to about 23 million in 1929, and every car needed steel for its body, rubber for its tyres, glass for its windows and leather or cloth for its seats, so the motor industry became one of the biggest customers of these industries. The oil industry grew rapidly to supply petrol. Road-building expanded, helped by the Federal Highway Act of 1921, and along the new roads appeared petrol stations, garages, motels and roadside restaurants. Car dealers and credit companies, such as the one General Motors set up in 1919, also grew. Hundreds of thousands of people worked in car factories in and around Detroit, and many more depended on the motor industry indirectly. These jobs and wages were spent on more goods, spreading prosperity across the economy.

The motor industry also changed the way Americans lived. Cars allowed people to live in the new suburbs and drive into the cities to work, so towns spread outwards. Families could take weekend trips to the countryside, beaches or national parks, and young people gained a new freedom from their parents' supervision, which worried many conservative Americans. For farmers and rural families, the car reduced isolation, making it easier to reach shops, doctors and entertainment in town. There were negative changes too, such as traffic jams, road accidents and the decline of the railways.

Which effect was more important depends on what is being judged. The changes to everyday life affected millions of families and lasted long after the 1920s, shaping American society for the rest of the century. However, many of these social changes reached only those who could afford a car, while the growth of other industries affected the whole economy.

Overall, I think the growth of other industries was the more important effect in the 1920s. It was the main way in which the motor industry drove the boom: by creating demand for steel, rubber, glass, oil and roads, it generated jobs and wages for millions, which in turn kept the consumer society growing. The changes to how people lived were important, but they were largely a result of that economic expansion.