By the end of the 1920s the motor industry was America’s biggest industry. As well as employing hundreds of thousands of workers directly it also kept workers in other industries in employment. Glass, leather steel and rubber were all needed to build new vehicles. Petrol was needed to run them and labourers were busy building roads for them to drive on. This was all because of Henry Ford’s Production line. This made him very important.
The First World War also had an impact on the American economy. America only joined the First World War in 1917 and so suffered relatively little. However the American economy gained. It got a great short term boom from selling weapons foodstuffs and machinery to Britain and France. In addition to this they also lent vast amounts of money which generated lots of interest. The USA also took advantage of the war by stealing markets in Asia and South America from Britain and Germany. The war also created lots of new industries like advertising which came from propaganda.
In the 1920s America had three republican presidents, Harding, Coolidge and Hoover. These three men all believed in Laissez Faire Economics. This means that the government thought that they should interfere as little as possible in the running of the economy. This came apparent when the government introduced tariffs on imported goods, low taxes to give the Americans more money and trust which allowed individuals to get control of whole sections of the economy.
Another factor to consider is the change in attitudes which occurred in American society in the 1920s. The old idea of thrift and “saving for a rainy day” was replaced by “buy now pay later”. Americans increasingly felt they needed the best things to fell happy. This created lots of demand for consumer goods like fridges, houses like in Florida for example, and stocks and shares.
The USA was a vast country, rich in natural resources, with a growing population. It didn’t need to import many raw materials and didn’t need to export all its goods. The home market was large and was growing. It had massive steel, coal and textile industries. It was the leading oil producer. It was foremost in developing new technology such as motor cars and telephones and its new industries like chemicals were growing fast. This huge industrial strength greatly increased the boom and is one of the most important factors.
The given question states that “without Henry Ford the American Economy would not have boomed”. Although Henry Ford contributed greatly to the boom the power of America’s industrial strength, The impact of the First World War the change in attitudes and the governments republican policies would probably still have caused the American economy to boom.
