US 1920-1945

1920 to 1945: Determining the Role of the Federal Government and its Spheres of Influence
The United States experienced vast changes between 1920 and 1945. The “Roaring Twenties” marked the flourishing of the modern mass-production/mass-consumption economy, which delivered fantastic profits to investors, while also raising the living standard of the urban middle- and working-class. Following the Great Depression, Franklin D. Roosevelt’s New Deal aimed to restore some measure of dignity and prosperity to many Americans, and succeeded in doing so for organized labor, big business, and the lower classes. Finally, the success of the United States in World War II resulted in a changing environment and role change for American women, economic success that essentially ended the Great Depression, the formation of a foundation of the civil rights movement, and a change in United States foreign policy from isolationism to interventionism, ultimately determining the status of the United States on the world stage today. These changes in the United States, (economic evolution, social and racial ‘climate change’, and development of modern foreign policy), ultimately effected the current status of the country as it is known today, determining the federal government’s role in those respective areas.
The 1920’s, more famously known as the “Roaring Twenties”, was a time of extreme change in the United States, not only socially and culturally, but also economically. The explosion in new mass-production industries, fueled by the spread of technologies like electricity and the assembly line, provided ample opportunities for profitable investment, and the stock market began its famed ascent. The upper classes of the United States benefitted from these investment opportunities and continued to flourish. However, the “haves” were not the only group to benefit from the newly successful economy. The “have nots” of American society saw a tangible improvement of quality of life. Real wages for urban workers increased by about 20% during the 1920s and ordinary people in America's cities and towns could reasonably expect to be able to own a car, a washing machine, a refrigerator, a radio, and a host of other modern conveniences that drastically reduced housework and improved the quality of life.
Americans’ spending patterns were significant in such a way that the current economy of the 21st century operates similarly: consumer spending comprised 71% of the economy of the United States by the end of the decade and the practice of mass-production meant fewer labor costs and a faster rate of production, resulting in economic success. While the short-term effect of the Roaring Twenties was a severe financial crisis, the long term influences of the decade reach into the twenty-first century and affect the way in which the economy operates today. During this time period, the federal government had a small part in economic activity, and consequently, its success. However, following the Great Depression, the role of the federal government would forever be changed.
After the failure of Herbert Hoover to revive the failing economy of the United States, following the stock market crash of 1929, Franklin D. Roosevelt implemented new economic policies that would be known as the New Deal. These policies and programs increased the influence, or “size”, of the federal government, in regards to its role in economic activity. The programs mainly benefitted organized labor, big business, and the poor. Franklin D. Roosevelt was a strong supporter of organized labor. With presidential support for unionization, there were changes in the relationships between employers and their employees. The federal government took a more active role in those relationships due to legislation like the Fair Labor Standards Act, which implemented working conditions many Americans are familiar with today: minimum wage, overtime, and exclusion of minors from the workplace. While it could be assumed that these changes, in favor of the working class, were detrimental to big business, the opposite was true. Because of the dedication of the federal government to its domestic agenda, there was a renewed consumer faith in the banking system and government-encouraged consolidation results in an increased stability of that system. President Roosevelt said in 1933, “I favor as a practical policy the putting of first things first. I shall spare not effort to restore world trade by international economic readjustment, but the emergency at home cannot wait on that accomplishment…” (President Franklin D. Roosevelt Says Government Must Act, 1933, page 238). Also, farmers who owned large amounts of land, already at a competitive advantage, benefited most from government subsidies and increased mechanization as they removed unneeded manpower. While it is a common opinion that Big Business and Big Government are enemies, and that they cannot exist cohesively, the policies of FDR’s New Deal proved that industry and government can grow and succeed at the same time.
Finally, the group most affected by the New Deal is, without a doubt, the poor. The implementation of the Federal Emergency Relief Administration, Social Security, the Works Progress Administration, the Civil Works Administration, and many more resulted in a complete revival of the lower classes of American society. At this point in time, it was completely feasible that multiple millions of unemployed workers could be put to work in a matter of weeks. The most lasting of those programs was that of Social Security. In an essay titled “FDR: Advocate for the American People,” David M. Kennedy said that “no other New Deal measure proved more lastingly consequential or more emblematic of the very meaning of the New Deal,” (page 252).
The New Deal “era” is said to be the most influential period of American history in regards to the government’s role in the economy. Due to presidential action and legislative force during this time, the federal government would now guide the overall pace of economic activity, attempting to maintain steady growth, high levels of employment, and price stability. Despite the success of the consumer-driven economy of the 1920’s, which ultimately determined the economic structure of the country in the years to come, the American people began to understand that there are certain limitations to a free market economy and those limitations are easily circumvented by the government, in order to maintain a successful system. Most importantly, the focus of U.S. economic policy shifted from personal liberties and freedoms to the common good of the American people. The role of “big government” evolved to be the protector of Americans’ political interest from local majorities and the provider of public goods.
World War II was an extremely significant international catalyst for change. The United States emerged from the war with the least amount of casualties and the most room for economic, political, and social improvement. Within the U.S., women were among those most affected. When men went off to war, women entered the workforce, employed in defense plants and war-related organizations, in addition to managing their households. During the war, nearly 35,000 American women served in uniform, not only at home, but also abroad. The increased opportunities for women began the ongoing evolution of the role of women in the workforce and in society. African Americans were another group of American citizens affected by the war. The short-term effects of the international conflict were not necessarily beneficial for African Americans. However, World War II provided great opportunities for those enlisted. The military offered enlistees a reliable salary, so many African Americans plagued by unemployment and poverty enlisted to escape the degradation of the current condition. During the war, African Americans fought beside their white counterparts, becoming more aware of the disparity between them. When enlistees returned home to the U.S., they had an increased fervor for civil rights. It is widely speculated that World War II was a major stimulus for the civil rights movement, which shaped the social and racial attitudes of the United States.
Economically, World War II essentially ended the Great Depression. Growth during this period was driven by government spending and accompanied by declines in consumption and investment in comparison to the pre-war trend. While it became difficult for households to purchase goods when the raw materials were used for the war effort, the overall rate of production kept up with the war effort and resulted in economic success for the country. The main contribution of the war was the creation of a “necessary” existential threat to enable the political will for the government to spend over 37% of GDP on military outlays for the last years of the war. In other words, excess capacity was removed and large corporations were able to employ previously unemployed people in the workforce. The previous success of the twenties returned to the United States, but rather than through consumer spending, the economy flourished through job creation and industrial force.
On an international scale, the U.S. emerged from the war as the only nation whose industrial power remained untouched with the means to rebuild, unlike Britain and France. Winston Churchill said this of the strength of the United States: “The United States is like a ‘gigantic boiler. Once the fire is lighted under it there is no limit to the power it can generate’,” (British Prime Minister Winston Churchill Reacts to Pearl Harbor, 1941, page 271). The events of the war resulted in a change in American foreign policy from isolationism to interventionism. American influence was expanding rapidly, resulting in the United States’ status as one of two remaining superpowers, (the other being the Soviet Union). This shift in policy can now be seen as a primarily beneficial change. Isolationism promotes the abandonment of foreign interests and resources. Furthermore, the balance between national interests and humanitarian interests does not exist. In the end, the relinquishment of international humanitarian interests contradicts the American principles of freedom and justice. Interventionism promotes the acquisition of influence, intelligence, political assistance, and local support through positive and evolving international, diplomatic relationships. The lasting effects of this shift in policy are tangible through the United States’ status of massive influence and the success of international peacekeeping organizations, like the United Nations.
In conclusion, the changes in American economic policy, racial and social attitudes, and the United States’ influence on the rest of the world were primarily beneficial. The Roaring Twenties introduced the economic practices of mass production and mass consumption, which still make up the largest sector of the American economy. New Deal programs and policies ultimately determined the role of the federal government in those economic practices. Finally, the effects of World War II changed not only the ways in which the United States operates with other countries, but also the ways in which it interacts with its own people, whether through new additions to the work force, laying the foundation for the civil rights movement, or stimulating the economy to its status as the most successful in the world.