1920s Consumerism

1920s Consumerism

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Overview

• The industrial revolution of the late 19th century produced new inventions and improved manufacturing processes.
• By the 1920s, a new standard of living emerged. Inventions designed for home use appeared.
• Americans indulged in a purchasing frenzy.
• They demanded more goods than people of the past ever owned.

Republican economic policy

The nickname "the Roaring Twenties" is apt. The 1920s were alive with luxury automobiles, home radio sets, and jazz music. As industrial production boomed throughout the decade, the American economy rose. Economists trace the source of this economic increase to the White House. The three presidents who served in the 1920s shared notable similarities. They were all conservative Republicans. Each president won a majority of the popular vote. Each also enacted policies that favored big business. President Warren G. Harding chose millionaire Andrew Mellon to serve as the Treasury Secretary. The capitalist Mellon supported a free-market economy. Harding cut taxes. Harding's successor, President Calvin Coolidge, cut taxes and government spending. Coolidge reduced the

government deficit by 18%. The stock market was soaring. But in 1928 when President Herbert Hoover took office, the global economy began to stagger. Europe's war debts were impacting national economies around the world. In America, a decade of loose economic policies added further strain. By 1929, the American stock market's collapse would signal an end to the prosperity of the Roaring Twenties. But while the 1920s roared, American consumers enjoyed abundant goods and a high degree of personal comfort.

the teapot dome scandal

Warren G. Harding was born in Ohio after the Civil War. He never forgot living in the harsh post-war economy. Harding's approach to government regulation and taxation was laissez-faire. This French term meant "hands off." Harding's ideas appealed to a group of Ohio Republicans. They helped Harding win the presidential race in 1920. President Harding intended to run his government like a business. He appointed his Ohio friends to cabinet positions with full authority. People called them "the Ohio Gang." Harry Daugherty, Harding’s attorney general, was the group's leader. Other cabinet appointees were Secretary of the Interior Albert Fall, Veteran’s Bureau chief Charles Forbes, and Jess Smith, an official of the Justice Department.

The Ohio Gang grew rich from organized fraud. They allowed private companies to lease US petroleum reserves at low rates. Newspapers labeled this crooked deal the Teapot Dome scandal. Congressional investigating committees found mass corruption. They accused Daugherty of selling pardons and illegal liquor permits. Harding forced Daugherty to resign. Fall became the first presidential cabinet member convicted of a felony while in office. Forbes was convicted of fraud, conspiracy, and bribery. Smith committed suicide. News of the scandal led to public mistrust.

A new Standard of living

The 1920s brought industrial marvels that made everyday life easier. More households owned items like washing machines, vacuum cleaners, dishwashers, and radios. Automobiles were also in high demand. The mass production of cars connected rural areas to cities. Taking a Sunday drive through the countryside became a regular family activity. Unlike indoor appliances, cars were a visible status item. This fostered a spirit of competition among Americans. Other developments helped increase consumerism. Catalogs sent through the US mail allowed advertisers to reach the masses. The movie screens promoted consumerism by showing actors playing successful and prosperous people who enjoyed luxurious lifestyles. Americans sought to imitate the

unrealistic standards that they saw in films.Consumers demanded more clothing options for both men and women. They clamored for stylish cars and furnishings. Even people who could not achieve wealth could purchase items that gave them the illusion of wealth. Increasing consumer demand fueled increasing mass production of luxury items.

Installment Plans Change Buying Habits

Most Americans had little cash on hand to make large-item purchases. However, they could pay over time for items through credit, layaway, and installment plans. An installment plan allowed an individual to purchase an item then make the payments over a period of time. This enabled consumers to buy expensive items they could not afford to buy all at once. Americans were buying now and paying later. The Ford Model T was the first automobile offered with the option of an installment plan.Installment buying was a completely new idea for Americans. At first, many people were distrustful of using credit to purchase anything. Americans shared a long tradition of thriftiness. Many people regarded going

without luxuries as an American virtue. However, constant advertisements helped convince many Americans to try this new way to buy. The 1920s became a boom time for American industry. Millions of Americans used installment plans to purchase homes, automobiles, household appliances, radios, record players, and clothing. People experienced the pleasure of being able to possess expensive goods instantly. Consumers could choose weekly, monthly, or even yearly payment plans.

Installment Plans Change Buying Habits (Continued)

These advantages had downsides, however. The terms in the fine print held a hitch: If the buyer missed one single payment, the seller could repossess the goods. Another disadvantage was that people often purchased items they could not afford, even over time. By the decade's end, the twin factors of spiraling wealth and growing debt would fuel a financial disaster.