1900s Case

I agree with the view that the American economy of the 1920s contained the seeds of its own destruction. However, I think that this is an easy view to agree with in hindsight of the downfall of the American economy. The economy could have contained the seeds to its own downfall for many reasons, but it’s hard to tell whether this is just because we can see the consequences or not.

The main factor backing up the view that the American economy of the 1920s contained the seeds of its own destruction is the continuation of the mass production of goods like cars, fridges, and waffle makers. This continuation was a big problem for the American economy because everyone that wanted to buy these items would have already done it, so the corporations that continued, like Ford for example, were setting themselves up for failure. Industries like coal and textiles also suffered the same fate. The use of credit also became a catalyst for the decline of the industry however it was more the old industries that suffered due to new technology. Source H, an extract from the penguin history of the USA reflects this opinion. That the “textile industry collapsed under competitions from mills in the south” and the “workforce employed in the industry shrank from 190,000 to less than 100,000” this was due to the ever improving technology that was being put into place in these industries.

One argument that relates well to this is that there was a growing uneven distribution of employment, meaning a bigger gap between the rich and the poor. This is shown in source I. source I backs this up in that it says that “in 1929 the richest 5% of the population received 33.5% of all disposable income”. This also shows that because wages were starting to decrease, only the richest of the population could afford to buy the luxury items that were previously being bought by everyone. This could be because “corporate profits jumped by 62%”. And that the 5% of the population