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Growth of consumerism (e.g., hire purchase and buying on the margin)

7.1 The Great Crash

The Progressive Era in the United States

 A Level/AS Level/O Level

History Notes

Your Burning Questions Answered!

Analyze the role of hire purchase and buying on the margin in fueling consumerism during the Progressive Era in the United States.

Discuss the social, cultural, and economic consequences of the growth of consumerism in the early 20th century United States.

Evaluate the effectiveness of government regulations in controlling consumerism during the Progressive Era.

Compare and contrast the causes and effects of the Great Crash of 1929 in the United States and other industrialized nations.

Assess the impact of the Great Depression on American society and the long-term consequences for economic policy and social welfare.

Growth of consumerism (e.g., hire purchase and buying on the margin)

The Growth of Consumerism

1. The Dawn of a New Era:

⭐Late 19th and Early 20th Century: In the late 1800s and early 1900s, the Industrial Revolution was booming! New technologies like electricity and the assembly line made it possible to produce goods faster and cheaper than ever before.
⭐Marketing Magic: Companies started using clever marketing techniques to convince people they needed all these new products. Advertising, catalogs, and department stores became popular ways to get people excited about buying.

2. The Rise of Credit:

⭐Hire Purchase (Installment Plans): People didn't have to pay for everything all at once. They could buy items on credit, making small payments over time! This made expensive things like cars and washing machines accessible to more people.
⭐Buying on the Margin: This was a risky way to buy stocks. You'd borrow money from your broker to buy stock, hoping its price would go up so you could sell it for a profit and pay back the loan. But if the stock price went down, you'd lose a lot of money.

3. The Consumer Revolution:

⭐From "Needs" to "Wants": This era saw a shift from buying just the essentials (food, clothing, shelter) to purchasing things for pleasure and convenience. New products like radios, refrigerators, and vacuum cleaners became popular, changing people's lives.
⭐A Culture of Consumption: Consumerism became a major part of Western culture. It created jobs, boosted the economy, but also led to people going into debt and the pressure to keep up with the latest trends.

The Progressive Era in the United States (1890s-1920s)

1. A Time of Change: The Progressive Era was a period of social activism and political reform in the United States. People were concerned about problems like poverty, corruption, and unfair business practices.

2. Key Movements and Goals:

⭐Muckrakers: Journalists like Upton Sinclair and Ida Tarbell exposed corruption and wrongdoing in society through their writing.
⭐Social Gospel Movement: This movement encouraged Christians to address social problems like poverty and inequality.
⭐Labor Unions: Workers organized to fight for better wages, working conditions, and the right to form unions.
⭐Women's Suffrage Movement: Women fought for the right to vote, which they finally achieved in 1920 with the passage of the 19th Amendment.

3. Political Reforms:

⭐Direct Primary Elections: This allowed voters to choose their party's candidates, giving them more power in elections.
⭐Initiatives and Referendums: Citizens could propose laws and vote on them directly, bypassing the legislature.
⭐Recall Elections: This allowed citizens to remove elected officials from office before their term ended.
⭐Regulation of Monopolies and Trusts: The government began to regulate big businesses to prevent them from unfairly controlling the economy.

4. Legacy of the Progressive Era: The Progressive Era left a lasting impact on American society. It paved the way for more social justice, worker rights, and government regulation. It also highlighted the importance of citizen participation in government and social change.

7.1 The Great Crash

1. A Boom Gone Bust: The 1920s were a time of economic prosperity in the US, fueled by new industries, mass production, and consumer spending. However, this boom was built on shaky ground.

2. Signs of Trouble:

⭐Overproduction: Companies produced more goods than people could consume, leading to surplus and falling prices.
⭐Speculation and Debt: People invested heavily in the stock market, but many used margin buying, taking on huge debts.
⭐Unequal Distribution of Wealth: While the rich got richer, many Americans struggled to make ends meet, leading to decreased consumer spending.
⭐Weak Banking System: Many banks had invested in risky ventures, making them vulnerable to financial collapse.

3. The Crash of 1929:

⭐Black Tuesday (October 29, 1929): The stock market crashed, losing billions of dollars in value. Panic spread, and banks began to close.
⭐Ripple Effect: The crash triggered a global economic depression known as the Great Depression, causing widespread unemployment, homelessness, and poverty.

4. The Great Depression:

⭐Unemployment Soared: Millions lost their jobs, and lines for bread and soup kitchens grew longer.
⭐Businesses Failed: Many companies went bankrupt, and farms were foreclosed upon.
⭐Dust Bowl: A severe drought in the Midwest turned the land into dust, forcing families to flee their homes.
⭐Government Response: The government, initially hesitant to intervene, eventually implemented programs like the New Deal to provide relief and stimulate the economy.

5. Lessons Learned:

The Great Crash highlighted the dangers of excessive speculation, unequal wealth distribution, and a weak financial system. It served as a reminder that economic booms can turn into busts, and governments must be prepared to intervene in times of crisis.

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