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    Part 3. THE U.S. IN THE 20th AND 21st CENTURIES

    Part 3 covers major events of the 20th century and the first decade of the 21st century. It describes the following events and time periods:

    • the U.S. in the 1920’s

    • the U.S. in the 1930’s

    • World War II and the end of the Great Depression

    • the U.S. in post-war years

    • the U.S. in the 21st century


    Key Words and Proper Names: allowance, assault, brinksmanship, be sworn in, cash-and-carry plan, casualty,ceasefire, counterinsurgency, deflation, deployment of nuclear missiles, depository, détente, disabilities incurred at work, “dot-com” industries, downsizing, electrocute, federal expenditures, hostility, impeachment, internee, the install­ment plan, military draft, nonviolent protest sit-ins, overdue, perjury, the pillars of economic growth,policy of containment of communism behind the iron curtain, the policy of massive retaliation, ragtag army, relief program, relocation center,social security system, stance, surplus, welfare state;

    the Cuban Missile Crisis, the League of Nations, Marshall Plan, McCarthyism, Monroe Doctrine, Roaring Twenties, Iron Curtain, Strategic Arms Limitation Treaty (SALT), Truman Doc­trine, United Nations Charter, Watergate scandal.
    World War I: When World War I began in 1914, the U.S. firmly maintained neutrality. The pretext to enter the war was found when the RMS Lusitania (May 1915), a British ship carrying many American passengers, was sunk by a German submarine. But the U.S. Congress did not hurry; it declared war on Germany only on April 6, 1917.

    The U.S. casualties in WWI were 112,000 people and mainly to diseases including influenza. The war ended in October 1918 when Germany asked for peace.

    Interesting to know: During WWI a very famous recruitment poster depicted America's National symbol of Uncle Sam pointing at the viewer with the words "I WANT YOU” appearing below.

    Uncle Sam is a national personification of the U.S. Its origin can be traced back to soldiers stationed in New York state during the War of 1812, they used to receive barrels of meat stamped with the initials U.S. The soldiers jokingly referred to U.S. as the initials of their meat supplier, Uncle Samuel Wilson, of city Troy, New York. The 87th U.S. Congress adopted the following resolution on September 15, 1961: “Resolved by the Senate and the House of Representatives that the Congress salutes Uncle Sam Wilson of Troy, New York, as the progenitor (originator) of America's National symbol of Uncle Sam”.

    Fig. 8. U.S. recruitment poster



    In 1918, a peace conference was held in France. Presi­dent Wilson helped draft the peace treaty and offered a plan for a world organization to help pre­vent another war. The organization was called the League of Nations. But Congress refused to let the U.S. join the League as it supported the idea of not getting involved in new European quarrels, in other words, the U.S. chose to pursue unilateralism, non-involvementand isolationism.

    In fact, Woodrow Wilson was a tragic wartime president who led his country to victory but could not hold the support of his people for the peace that followed. His fate was later shared by British Prime minister W. Churchill in 1945.

    The war changed American mentality; the U.S. withdrew from European affairs. The American people chose isolationism: they turned their attention away from international relations and solely toward domestic affairs. Disillusioned by the war, soldiers returned home. A popular song of 1919 asked, concerning the U.S. troops returning from World War I, “How Ya Gonna Keep 'Em Down On the Farm After They've Seen Paree?” Many of these retirees did not remain “down on the farm,” because there was a great migration of formerly rural population to the cities.

    The aftershock of the October Revolution resulted in real fears of communism in the U.S. Americans became hostile to foreigners. In 1919, a series of terrorist bombings produced a three-year "Red Scare." Under the government authority, political meetings were raided and several hundred foreign-born political radicals were deported, even though most of them were innocent of any crime. In 1921, two Italian-born anarchists, Nicola Sacco and Bartolommeo Vanzetti, were convicted of a murder on the basis of shaky evidence. Many people, mostly intellectuals protested, but in 1927 the two men were electrocuted.

    Congress enacted immigration limits in 1921 and tightened them further in 1924 and 1929.

    The Ku Klux Klan, a racist organization, attracted new followers and terrorized blacks, Catholics, Jews, and immigrants.

    The Roaring Twenties: The 1920’s or the Roaring Twenties were an extraordinary and confusing time, when hedonism coexisted with puritanical conservatism. It was the age of Prohibition: as in 1920 the 18th Constitutional Amendment outlawed the sale of alcoholic beverages. Gangsters carried machine guns; they organized bootlegging - illegal supply of alcohol from Canada and elsewhere.

    It was the age of jazz and spectacular silent movies, the age of girls dancing the Charleston, Charlie Chaplin playing comical tricks.

    For big business, the 1920’s were golden years. The U.S. was now a consumer society, with booming markets for radios, home appliances, synthetic textiles, and plastics. Between 1919 and 1929, mass-production factories doubled their output.

    In the 1920’s, America became a nation on wheels. It seemed as if every family were buying a car. One of the most admired men of the decade was Henry Ford, who had introduced the assembly line into automobile factories. Ford could pay high wages and still earn enormous profits by mass-producing the Model T, a car that millions of buyers could afford.

    Buying durable goods on the install­ment plan was a new idea in American business. The installment plan made it possible for people to “own” cars before they really owned them.

    It had a good effect on business because more people were able to buy expensive things. Suburbs, towns and neighborhoods lying around bid cities, began to grow fast. In the 1920’s, the nation became increasingly urban, and everyday life was transformed as the "consumer revolution" brought the ever growing use of automobiles, telephones, radios, and other appliances. The pace of living quickened, and morals became less restrained. At this time, fortunes were rapidly accumulated on the skyrocketing stock market, in real estate speculation, and elsewhere. For a moment, it seemed that Americans had the Midas touch. To some it seemed a golden age. But agriculture was not prosperous, and industry and finance became dangerously over-extended.

    The superficial prosperity masked deep problems. With profits soaring and interest rates low, plenty of money was available for investment. Much of it, however, went into reckless speculations in the stock market. Stock shares’ prices were far above their real value. Investors bought stocks “on margin” (с уплатой только части стоимости ценных бумаг), borrowing up to 90% of the purchase price. The inflated stock market led to the crash of Thursday, October 29, 1929. The bubble burst. And the stock market crashed and the Roaring Twenties ended in deadly convulsions.

    U.S. in the 1930’s: The Great Depression was a period of American history that followed "Black Thursday", October 29, 1929.

    The market crash marked the beginning of a decade of high unemployment, poverty, low profits, deflation, collapsing farm incomes, and lost opportunities for economic growth and personal advancement. Unlike unemployed workers in Germany and France, Americans received no government unemployment pay. Millions spent hours and days in “breadlines”. The net effect of the Great Depression was a sudden and general loss of confidence in the economic future.

    The usual explanations of the Great Depression include numerous factors: especially high consumer debt, ill-regulated markets that permitted overoptimistic loans by banks and investors, the lack of high-growth in new industries, and growing wealth inequality - all interacting to create a downward economic spiral of reduced spending, falling confidence, and lowered production.

    In the U.S. between 1929 and 1933, unemployment soared from 3% of the workforce to 25%. It means that one out of every four workers was unemployed.

    By 1932, thousands of American banks and over 100,000 businesses had failed. Industrial production was cut in half, wages decreased 60%. With millions unemployed, the political ferment and discontent increased greatly among the working class.

    And an unsympathetic, improper or repressive response from the U.S. government might well have sparked a socialist uprising. By March 1933, there had been 13 milion unemployed, and almost every bank had been closed.

    In November 1932, Franklin D. Roosevelt was elected President on the platform of “a New Deal for the American people,” a phrase that served as a label for his administration and its many domestic achievements.

    His main idea was that the federal government should take the lead in the fight against the Depression. Roosevelt entered office with no single ideology or plan for dealing with the depression. This New Deal was often contradicting, pragmatic, and experimental.

    ButRoosevelt’s self-confidence galvanized the nation. “The only thing we have to fear is fear itself”, he said at his inauguration smiling. He followed up these words with decisive actions. Within 3 months - the historic “Hundred Days” - Roosevelt rushed through Congress a great number of laws to help the economy rebound (recover).

    The New Deal consisted of three types of programs (3 R’s programs) designed to produce "Relief, Recovery and Reform". He proposed and the Congress enacted a sweeping program called the New Deal to bring recovery to business and agriculture, relief to the unemployed and those in danger of losing farms and homes, and reform, especially through policies of greater government action. Roosevelt implemented a number of programs to aid the poor and unemployed. He contributed to the future stability of the economy by instituting new regulations in business, particularly banking.

    Recover and relief measures: Many of the new laws set up government agencies called “alphabet agencies” to help the nation to recover from the depression. The Civilian Conservation Corps (CCC) found work for many thousands of young unemployed people, they lived in camps and built roads, bridges, airports, parks, and public buildings, planted trees, strengthened river banks for food and $1 a day. The Federal Emergency Relief Organization (FERA) gave individual states government money to help their unemployed and homeless. The Agricultural Adjustment Administration (AAA) paid farmers to produce less; the Tennessee Valley Authority (TVA) built a network of dams to make electricity and stop floods in a poor southeastern region of the U.S. And the National Recovery Administration (NRA) worked to make sure that businesses paid fair wages and charged fair prices. The Works Progress Administration set people to work on jobs useful to the community. These alphabet agencies put millions of people to work. Between 1935 and 1940, the WPA alone provided 8 ml jobs.

    Reform measures included the National Industrial Recovery Act (NIRA) – dealing with regulation for industry, the Securities Exchange Act (SEA) - dealing with regulation of Wall Street, the Agricultural Adjustment Act (AAA) – devoted to implementation of farm programs, the Federal Deposit Insurance Corporation (FDIC) - devoted to insurance for bank deposits, and the National Labor Relations Act (NLRA) - dealing with labor-management relations. In 1935, the Social Security Act set up contributory old-age and survivors’ pensions and first American system of unemployment insurance.

    FDR’s critics accused him of turning America into a socialist state. It was not true, for Roosevelt opposed socialism in the sense of state ownership of the means of production, his only one major program, the Tennessee Valley Authority (TVA), involved government ownership of the means of production.

    The New Deal reflected the ideas and was influenced by the programs, that Franklin D. Roosevelt and most of his original associates had absorbed in their political youths early in the progressive era, while serving in the Woodrow Wilson administration or holding other offices in the 1920’s. From the progressive era, the New Dealers borrowed the opposition to monopoly, move toward government regulation of the economy, and put an end to age-long notions that poverty was a personal moral failure rather than a product of impersonal social and economic forces. From the Wilson administration, the ideas about government mobilization which helped mobilize the economy for the Great War. And from the policy experiments of the 1920’s, New Dealers picked up the ideas to harmonize the economy by creating cooperative relationships among its constituent elements.

    But, perhaps the strongest legacy of the New Deal was to make the federal government a protector of interest groups and a supervisor of competition among them.

    As a result of the New Deal, American political and economic life became much more competitive than before, now workers, farmers, consumers, and others were able to press their demands upon the government in ways that in the past had been available only to the corporate world.

    The New Deal created the rudiments of the American welfare state, through its many relief programs and above all through the Social Security system. Roosevelt’s boiling public personality, and his “fireside chats” on the radio did a great deal alone to help restore the nation’s confidence.

    The New Deal did not transform American capitalism in any genuinely radical way. Corporate power remained nearly as free from government regulation or control in 1945 as it was in 1933.

    To his credit, Roosevelt appointed an unprecedented number of African Americans to second-level positions in his administration, perhaps due to the influence of his wife, Eleanor Roosevelt, a vocal advocate of easing discrimination. And African Americans did benefit in significant though limited ways from New Deal relief programs. The New Deal established a political alliance between African Americans and the Democratic Party that survives to this day.

    New Deal programs stimulated demand and provided work and relief for the impoverished through the increased government spending. In 1929, federal expenditures were only 3% of the GDP. Between 1933 and 1939, federal expenditure tripled. However, spending on the New Deal was far smaller than on the war effort. During the war, federal expenditures went from 3% of the GDP in 1929 to about 30% in 1946 and amounted to $62 billion. In short, spending and government regulation cured the depression. Between 1939 and 1944 (the peak of wartime production), the nation’s output almost doubled.

    Consequently, unemployment fell by two-thirds in Roosevelt's first term (from 25% to 9%, from 1933 to 1937), then from 14% in 1940 to less than 2% in 1943 as the labor force grew by ten million. As you see, unemployment remained high throughout the New Deal years; consumption, investment, and net exports - the pillars of economic growth - remained low.

    It was World War II, not the New Deal that finally ended the crisis. In 1941, FDR said and his “fireside chat” on the radio “Old Dr. New Deal has to be replaced by Dr. Win-the-War.” His New Deal was over.

    30 years later one old American man expressed in his simple words how many Americans felt about FDR in those years. “Roosevelt?” he said in his television interview. “He was God in this country”. Even so, it was not FDR’s New Deal that ended unemployment in the U.S. It was the German dictator, Adolf Hitler, who did that.
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