DESIGNED BY SIBONGISENI KUBHEKA AN EDUCATION STUDENT AT THE UNIVERSITY OF JOHANNESBURG.

1. CAPITALISM IN THE USA 1900 TO 1940

2. CAPITALISM IN THE USA 1900 TO 1940
is an economic system which the government plays a
secondary role. People and companies make most of the
decisions, and own most of the property... The means of
production are largely or entirely privately owned by
individuals or companies and operated for profit.

3. THE GROWTH OF CAPITALISM DURING THE 19 AND
20 CENTURIES IN THE US:

4. CAPITALISM FLOURISHING
 At the beginning of the 20th century, the United States (US) was a burgeoning
superpower. US industrial and manufacturing rivalled that of the European great
powers.
 American economic growth in the second half of the 1800s was the fastest in its
history, generating significant increases in production, wages and personal wealth.
 The late 1800s, in particular, was a period of rapid industrialisation, expansion,
population growth and, for some, growing prosperity.
 The tremendous opportunities available in America sparked a surge in immigration in
the late 1800s. Millions of migrant workers crossed the seas from Europe and Asia,
seeking job opportunities as well as political and religious freedom.

5. CONTINUES….
• Industrial growth transformed American society. New transport infrastructure
made travel and relocation easier. Some American cities – particularly New York,
Chicago and Philadelphia – swelled with newcomers. American industrial growth
expanded its military strength.
• Most of this growth sprung from unrestrained capitalism. America’s economic
growth came not from government policy but from private capital and
investment, as well as the availability of cheap labour.

6. CONTINUES….
• Unchecked by government restrictions or high labour costs, American capitalists
built gigantic corporations, transportation and communications networks, heavy
industries and powerful banking and financial organisations.

7. THE GUILDED AGE
• During the Gilded Age the United States endured a number of mediocre
presidents and politicians, many of them in the pocket of big business.
• Laws of the time protected corporate interests but overlooked social problems
and the rights of workers.
• There was growing discontent about wage levels and the treatment of labour
• Women and children endured even worse workplace conditions, since they could
be hired for much lower wages than men.

8. THE PROGRESSIVE ERA
• In this era, wages increased and the America middle class began to grow.
• There were gradual improvements in working conditions, though unions
continued to flourish in the early 20th century.
• America’s industrial economy was given a shot in the arm by World War I.
• Though the US did not enter the war until April 1917, many American companies
raced to sign lucrative deals to supply the Allies – Britain and France chiefly – with
munitions, equipment and supplies.

9. CONTINUES ….
• While the war devastated Europe physically and economically, America was
untouched and financially invigorated.
• The United States entered the post-war period as a genuine superpower.

10. CAPITALIST INTERESTS WERE SERVED ON ALL
LEVELS OF GOVERNMENT:
• Local taxes were exceedingly light on the largest enterprises.
• A crucial step in this process was local assessment of property as a base for
taxation.
• Profits grew accordingly. Between 1905 and 1917, the company "earned a sum
equal to 150 percent of its outstanding capitalization and paid in dividends a sum
equal to its capitalization.

11. CONTINUES ….
• Heightened mechanization accompanied monopolization
• In the steel industry, labor costs fell. Between 1890 and 1910, steelworkers'
earnings rose by half while their productivity tripled.
• Another source of increased profits came from the lengthened workday.
• By 1920, 85,000 U.S. Steel workers labored for 12 hours per day for seven days a
week.
• This number had risen from slightly over 45,000 nine years earlier.

12. EVENTS LEADING UP TO THE GREAT DEPRESSION
• A number of factors contributed to the country's financial troubles
• Reckless spending
• More people bought stock as part of investment
• Led to the Wall street crash

13. THE GREAT DEPRESSION
• The Great Depression began with the stock market crash of 1929 and lasted until
1939.
• The worst economic downturn in history, the decade was defined by widespread
unemployment and steep declines in industrial output.
• President Franklin D. Roosevelt responded to the crisis with a series of federal
programs known as the New Deal, which included the Social Security
Administration and the Works Progress Administration.
• The Great Depression caused drastic declines in output, severe unemployment,
and acute deflation in almost every country of the world.

14. • Its social and cultural effects were no less staggering, especially in the United
States, where the Great Depression represented the harshest adversity faced by
Americans since the Civil War.
• Virtually every industrialized country endured declines in wholesale prices of 30
percent or more between 1929 and 1933.
• he prices of primary commodities traded in world markets declined even more
dramatically during this period.

15. CONTINUES …
• The prices of coffee, cotton, silk, and rubber were reduced by roughly half just
between September 1929 and December 1930.

16. THE US RECOVERY 1933
• The output grew rapidly in the mid-1930s: real GDP rose at an average rate of 9
percent per year between 1933 and 1937. Output had fallen so deeply in the early
years of the 1930s, however, that it remained substantially below its long-run
trend path throughout this period.
• In 1937–38 the United States suffered another severe downturn, but after mid-
1938 the American economy grew even more rapidly than in the mid-1930s. The
country’s output finally returned to its long-run trend path in 1942.

17. REFERRENCING …
1. Jeremy Atack, "Industrial Structure and the Emergence of the Modern Industrial
Corporation," Explorations in Economic History, 22 (1985), p. 37.
2. Thomas S. Ulen, "Railroad Cartels Before 1887: The Effectiveness of Private
Enforcement of Collusion," pp. 125-144 in Paul Uselding, ed., Research in
Economic History, Vol. 8, 1983. For another case, see testimony of Isaac H.
Sturgeon in U.S. Congress, 49th, 1st session, Senate, Select Committee on
Interstate Commerce, Report, Appendix, Report No. 46, Vol. 2, pp. 161-162,
Serial set number 2356, 188

18. 3. Robert N. Grosse, The Determinants of the Size of Iron and Steel Firms in the
United States, 1820-1880 (doctoral dissertation, Harvard University, 1948), p. 271.
4. Lewis Corey, The Decline of American Capitalism (Covici Friede, 1934), p. 278.
5. Douglass C. North, "Life Insurance and Investment Banking at the Time of the
Armstrong Investigation of 1905-1906," Journal of Economic History, 14 (Summer
1954), p. 210.29. Ibid., p. 212.
6. Douglas F. Dowd, "A Comparative Analysis of Economic Development in the
American West and South," Journal of Economic History, 16 (December 1956), p.
569