Stuff. And it wasnt just americans who were in the situation but so too were our trading partners around the world. They didnt have enough income to buy all the commodities we were producing in our fields and all the wonderful things our factories were making. So by the end of the 1920s the American Economy went bust. You all know the stock market crashed in 1929 and the World Economy went bust as well, a worldwide economic depression set in that lasted between 1929 and wasnt officially over until 1942. What was called the Great Depression could be considered a crisis of abundance. It brought attention to purchasing power and in doing so it ended up politicizing consumption. We talked a lot about how consumer culture rose to be at the very center of american culture. And i keep telling you we need to consider politics, and today is the day we will think about how consumption became plit politicized. So heres a graphic that typifies the usual story that historians tell about the Great Depression. This is story im sure you guys have all heard at one point or another when you were juniors in high school in our American History class, if youve had other American History classes. Heres the typical story thats told. And each of the bubbles in this graphic does bear some of the burden for the catastrophe, but i want to focus our attention on the uneven distribution of wealth and on the overproduction. And i want to show you how the relationship between those two brought on what we can call a crisis of abundance. Due to World Historic levels of agricultural and manufacturing productivity we talked a lot about this, an age of abundance had arrived in the United States by the 1870s. The ship from an economy of scarcity which we talked a lot about to an economy of abundance entailed what we identified in this class when we started reading susan strasser, a crisis of distribution. So much was being grown and so much was being made not only the logistics for getting goods to market difficult but finding new markets were imperative. I asked you what were some of the things guilded age producers, farmers and manufacturers, whats are some of the things they did to solve this problem of overproduction, to find new markets . Yes, sam. Any type of description on the packaging. Okay, right, product differentiation, name brand, packaging. What else besides what sam has just listed for us . What else do they do to find new markets . Build a direct connection to consumer. Thats good. They tried to pass over the wholesaler, retailer, go right to the consumer. What else . There were so many things that we talked about. So we talked a lot about the shift from production driven marketing to what kind of marketing . Market driven production, and we see right here in this slide a great example of Market Driven production. Which item on the slide typifies and then we see that label that typifies the kind of packaging, the branding and packaging and differentiating of product. These are a number of things that producer steps they took in order to try to find new markets for all the commodities they were grow [all the goods being made in factories. But despite these incredible efforts to find and identify new markets neither domestic nor foreign markets could absorb everything that was being grown and made in the u. S. Americans and foreigners just didnt have sufficient purchasing power to buy everything that was for sale. So the First World War rolls around and it delayed reckoning with this problem of overproduction. During much of the 1920s there were slight increases in purchasing power and that staved off reckoning with this power of abundance as well. World war i staves off the reckoning with the problem of abundance. And then the 1920s slight increases of purchasing power puts the problem off a little bit longer. But because prosperity didnt lift all boats sufficiently, at the end of the 20s the crisis of abundance erupted. This time generating more demand was impossible. It was impossible to differentiate products even further. All of the efforts sadver tizers went to add some kind of value to their product, but at a certain point theres no new markets to be found, no new demand to be generated. Americans wanted everything as far as i could tell, but they just didnt have enough money to pay for it. Let me first remind you about the economic boom of the 1920s. Ill just give you a bit of information about it. At the start of the decade, at the world war i ends at the very end of 1918, november 1918, and at the beginning of the 1920s the u. S. Held 40 of the wealth of the entire world. We were officially the richest nation in the world at that point. And over the course of a decade our gross domestic product, the gdp or Gross National product increased 40 so it increased 40 between 1920 and 1929. This is because agriculture nearly doubled. So the number of telephones doubled, the number of radios increased from 60,000 to 10 million. Part of the 60,000 is those 1920 radios were for amateurs, namely short wave radios whereas 1929 Everyone Wants a radio. Theyre a widespread consumer good. Thats incredible productivity. And there were more 160 times more electric refrigerators in 1929 as in 1920. Not only did productivity double over the course of the 1920s, so did wealth, so did prosperity. So lets look at prices for a minute. I think weve talked about this before but let me remind you about what the Consumer Price index is. So the Consumer Price index is probably something you hear in the news or see in newspapers often abbreviated to cpi. So the cpi is a measure of what a Market Basket of basic goods might be. So a Market Basket of basic goods might be milk, butter, the kinds of stuff that an ordinary family, almost all of us would buy. Its a measure how much all that would cost at any given moment. And its taken as a measure of any living. During and shortly after world war i prices increased. They increased pretty dramatically. They increased by as much as 60 . And then in the postwar period, right, immediately after the war that big trough there, that was due to a postwar recession and prices plummeted, right . They plummeted well below 1914 levels. And through 1924 the prices steadily increased. And then theres a little dip, they rise a little bit more until 1926, and then they level off and they begin to move downward by beginning of 1929. If we look at increase in prices over the course of 1920s as a whole, so 1919 to 1929 so we see up and down, but as a whole inflation was only 1 . So very low rate of inflation in the 1920s. But between 1900 and 1920 the rate of inflation was extraordinarily high. So 1900 to 1914 prices increased by 17 . And 1914 to 1919 in five years prices increased by 16 . So although americans in the 1920s experienced a relatively flat rate of inflation over the course of the three decades the cost of living did increase. It doubled, more or less. So the price of bread, price of food, et cetera doubled. If we look ever here in the corner at the price of the model t you see a slightly different story. You see another trend, and thats what . What does the price of the model t do . It goes down. It drops pretty prucipitously, right . And what happens in 1913 that brings the price of the model t down. The moving Assembly Line brings the cost of production down and therefore the price. What we see over the course of the 1920s is that automobile prices were not the only ones that dropped. The automobile prices are dropping so the model t, the price of the model t, the price of the other automobiles now to be sure there were some luxury automobiles whose prices increase, but one n only automobile prices are dropping, and prices for other durable goods are dropping as well. Like refrigerators, radio sets. Their price is decreasing over the course of 1920s and also over the price of semidurable goods like clothing and shoes. And these are precisely the goods, the things featured as the elements of the good life. We read the great gatsby for tuesday, for class on tuesday. And clothes and shoes and automobiles and telephones are featured as part of the life of these very rich people, right . And these items are not only featured as part of the lives of very rich people but mart of the good life that ordinary people should seek to obtain. So they were featured in magazine stories and advertisements and songs and movies, right . They were good life of what americans should aspire to. We see these expectations for owning these items being lifted by Department Store shelve windows, by advertising, by scenes in movies, by the lifestyles of celebrities. Now, when we talk about prices what were talking about is the cost of living. Okay, so write down prices, cost of living. But when we talk about expectations when we talk about expectations what were talking about is the standard of living, right . So prices, costs of living, expectations, standard of living. And the standard of living in the 1920s was on the rise. This new standard of living was beckoning americans to buy more, to identify new needs, new habits and most of all to want more. The threshold of desire was rising. Now, let me be really clear with you. Many americans, most americans had to make do without electric refrigerators, without automobiles, without colorful housedresses or matching bathroom towels or all of the things weve looked at and thought about. Increasingly, though, these luxuries were coming to be seen as decencies. So as decencies they are coming to be considered the birthright of all american citizens, something all american citizens had a right to claim, to wish for, to want. So lets think about this. So despite historic levels of economic productivity so we have historic levels of economic p productivity. Many americans were forced to live on the edge. They were making do. They were like George Wilson who you see here from the great gatsby. They were living in the ash heaps, right . Now, theres a lot of disagreement. No scholar has figured out exactly how Many Americans were living in poverty in the 1920s. There wasnt an official bureau charged with collecting statistics, theres no agreement today what constitutes living in poverty or living out of it. So ive looked and ive seen some scholars estimate that 70 of all americans lived in poverty in the 20s. That would be seven out of ten americans. Others say it was only 12 , that would be 2 out of 10. I think both those estimates would be extreme. I think the best guess is about a third. About a third of americans were living in poverty. 20 or so were probably near the line, maybe they were above poverty, but it was pretty rough. Life was a struggle for them. So what do you guys notice from this wage chart . How do the farm workers wages look . Like the unskilled workers, but theyre based on seasonal work, so their per year total is significantly lower than any of the unskilled workers. Right. So you see their yeary total is 357. Its estimated it took about 2,500 a year for a household to live a decent standard of living. So we can see even with the skilled workers this september an easy time for them, although 1500 seems a lot better than a 300 figure. Anything else you guys notice for these wages . Are they going up . For some, right, and then they kind of flatten, right . Inwe were to take these wages and compare them to prufbtativiprufb productivity, productivity doubles in the space of ten years. But wages do they double . Not even close. So the wages arent keeping up with pruativity at all. And what this suggests is that working americans were not receiving a significant or fair share of the wealth. Lets think for a minute about the distribution of wealth. Its probable something you guys have heard about in the news a lot today. In the 1920s the 1 the top 1 held about 24 of the nations wealth. The top 1 holds 24 of the nations wealth. So we have the 1 and the next 9 . The next 1 held the next 26 of the nations health. So the top 100 has a quarter of the nations wealth. As a whole the top 10 hold 50 of the nations wealth, so they hold the majority of the nations wealth. And then lets look at the bottom 60 . So the bottom 60 of americans held 5 of the nations wealth. 5 . And that other 30 in between that bottom 60 , they held the rest. They held about 45 of the nations we nations wealth, 44 . In fact, at no other time in our nations history except for right now has there been as much inequality, has a wealth been distributed so unequally, we dont need to think about the present moment, we will consider the 1920s ear. But the distribution of wealth was incredibly unequal. And so as a prominent intellectual, an activist named w. E. B. Debois. Hes looking at this situation. He didnt have access to the kind of statistics but its clear to him that something is very wrong, and hooobserveled and this is quote from him. We have today in the United States cheek by jowl prosperity and depression. Cheek by jowl. Just like this africanamerican newsboy. Hes selling a penny newspaper, and the penny newspapers headline is proclaiming a tax on billionaires or dissent over this billionaires tax. This is from 1921. Not only were most minorities impoverished but so too were farmers. Farmers were impoverished and they made up about 30 of our population. So too were coal miners and unskilled laborers. We have a vast proportion of americans who are essentially impoverished. So weve looked at this distribution of wealth. Despite the slow ratef inflation prices arent changing. Most americans didnt earn enough to buy the necessities and didnt earn decencies or any luxuri luxuries at all. You have incredible levels of economic prutiskt, Rising Consumer expectations, but you have wages that dont the pace at all. So up, up, up goes prutiskt but wages are here, theyre flat and in some cases going down. What did americans do about this . So let me make some generalizations for you first about how individuals and communities handle it when they cant pay for their needs and their wants. Now, just for a moment you might think about this yourself. What do you do when you cant pay for what you need . What do you do when you cant pay some of the things, what are some of the strategies . Youre college students. I bet you want many more things than what you can pay for. Maybe you need some things you cant pay for, too. What might you do . Yeah, henry. Substitute with other products or items or you may resort to stealing what you need. You might steal. You might substitute. Okay. Right. Okay. Good. I like these ideas. Yeah. Amelia. Take out a loan. You could take out a loan. Right. Okay, take out a loan, get some credit. Get a credit card. Okay. What else might you do . Yeah. Move in with friends. Like for saving in that sense. Right, so you budget. You could cut costs by pooling your resources. Share a textbook. Move in with friends. Share a car. Take the bus. You can economize in all sorts of ways. We have taking out loans, weve got stealing. We have economizing. What else . You could work more. Okay. Presumably minimum wage kind of thing. You could get another job, babysit. You could tutor. There are a zillion kids in this town who need tutoring. You guys could tutor, babysit, take a minimum age job. If youre over 21, you could bartend, wait tables, all sorts of things you could do to add to your income. Now, henry and logan suggested ways of sort of economizing or sort of trying to substitute trying to stieffle your demands. You could eat less, right . When i was in my first year of graduate school, i didnt have very much money so i ate a lot of ramen noodles. So you know, you can limit your expenditures, your desires, your wants, your needs. You can figure out how to do that. So what you guys have what we have just sort of laid out here, these are commonsense strategies. Theres nothing new about what you might come up with about how to make your ends meet and this is exactly what americans have been doing for a long time. So let me summarize for you. Theres one thing you guys didnt mention. That americans started to do, and thats trying to control prices. So the first thing that you might do if your needs and wants, if your income doesnt meet what you need or what you want is you could protest prices, right . You could engage in collective action to try to prevent inflation, try to prevent rising prices. So thats the first thing. Okay, so write that down. First thing. The second thing you can do, which you guys have sort of indicated is you can try to stifle demand, right . You could try to make do. You could spend less. You could try to expose yourself less to all of those stimulants that make you want things. You could stop internet shopping, right . For instance. And then the third thing you can do, and this is taking out a loan or getting a job, is you can try to increase your purchasing power. You can try to add to your income. So what did americans do in this period between 1900 and 1930 . Well, i think it would be pretty obvious that in the 1920s, americans were not trying to control prices. Prices, if anything, were going down. So theres no reason to try to control prices when theyre not going up. So theyre not trying to control prices in the 1920s. And in fact, for the most part, they were really relieved the war time inflation of 60 was over, and they were relieved prices had returned to prewar levels. So we dont see any protests. But this stands in contrast to the period between 1900 and world war i, so 1900 to 1915 or so, americans protested price hikes and all sorts of interesting collective actions. So for instance, they rioted. They rioted when the price of food got to be too high. They boycotted, so for instance, housewives boycotted butchers because the price of meat had risen so high that housewives said were not going to buy it at all. And it wasnt just an individual boycott. Thats fine, if i choose not to buy meat and eat beans, nobody is going to change the price of meat, right . But if all of us in dallas said were not buying meat until you decrease the price by 25 , we might get through to them, right . And so this is precisely what housewives did in 1908, 09. They boycotted butchers to protest the high price of meat. And heres one that maybe will inspire you. They refused to pay their rent. And these were called rent strikes. Now, a rent strike only works if everybody in the building refuses to pay the rent, right . Easy for a landlord to kick me out and find another tenant if i dont pay my rent. But if all of us didnt pay our rent, the landlord is going to have a hard time finding 28 people