The Economic Boom of the 1950s and '60s
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Aspects of the Economic Boom [ASPECTS]
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Affluence
In 1958 Kenneth Galbraith wrote The Affluent Society
about America. By 1960 the Standard of Living of the average American
was three time that of the average Briton. During the '50s, the number
of houses with a TV increased from 3 million to 55 million, watching shows
from 530 stations. The number of cars increased from 25-60 million,
1945-60.
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Suburbs
By 1960 25% of Americans lived in the suburbs and more
than 60% owned their own homes.
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Prosperous Middle Class
The 1950s have been called the ‘Golden Age’ – New York Times
reporter on the Economy Jim Tankersley thinks THE highpoint – of the
American Middle Class, with more than twice the real annual salary of their
grandchildren today, numerous ‘white-collar’ jobs, strong unions (e.g. the
AFL‐CIO) securing higher wages and better working conditions, and more
leisure and less debt.
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Economic Growth
The US economy grew 37% during the 1950s. The stock
market rose steadily, with the Dow Jones index topping 1,000 for the first
time in 1966. Growth was characterised by the growth of large
corporations, and high-tech electronics, military and the aerospace
industry.
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Consumerism
The Stockdale Center in Minnesota, opened in 1956, was the
first shopping mall. Conspicuous consumption was the marker of status
in American society, and was seen as the pathway to achieving a happy life.
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Teenageers
The economy increasingly aimed at young people with – for
the first time in History – money to spend.
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Sham!
It was of course, simply not real for many of the
population.
At a time when there was no national system of health
care, or of welfare benefits, 35% of the population were still living below the
poverty line.
Included in that 35% were the ‘hillbillies’ of the
Appalachians, Mexican and Hispanic Americans, and Native Americans.
The Southern states were much poorer than the North.
Two thirds of the elderly were living on an income
which was less than a quarter of the average wage.
Levels of poverty for African Americans were three
times higher than those for white Americans.
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Going Deeper
The following links will help you widen your knowledge:
BBC Bitesize on:
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The American Dream & Post-war prosperity
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Industrial
Output
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Affluence and
Consumerism
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Suburbanisation and the baby boom
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Poverty amid
Plenty
Essay: How did prosperity change the lives of the American people in the 1950s?
YouTube
Contemporary account
- excellent
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Causes of the Economic Boom [An
Incredible Dream,
G. I.
Jooe]
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American Dream
Originally, the idea of ‘the American Dream’, as popularized by James Truslow Adams in his 1931 book
Epic of America, was a social ambition for an America which was a free, equal and prosperous nation.
After WWII the term was hijacked by businesses and advertisers so that wealth
and possessions became markers of identity and status in American society, and
the supposed pathway to achieving the perfect life.
Betty Smith’s A Tree Grows in Brooklyn
((1943) – a semi-autobiographical novel detailing the successful struggle of
the Nolan family to achieve happiness – was widely read. Popular TV
series such as Leave It to Beaver and Father Knows Best
portrayed idealized versions of American suburban life, with a well-kept
home, modern conveniences, healthy living & morals, and a happy family life.
Advertising drilled home the idea that the way to
make your family happy was to give them the latest [whatever].
The expansion of consumer credit made it easier for
Americans to purchase goods and services.
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International Trade
The Bretton Woods agreement of 1944 stabilised world
trade by basing all currencies on the US dollar.
After WWII, to restart the economies of Europe
(and prevent the growth of communism), the Marshall Plan poured American
investment into the countries of Europe … which then bought things from
America.
The 1947 GATT (General Agreement on Tariffs and
Trade) promoted international trade by reducing tariffs.
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Demand
$$200 billion of war bonds matured, and people went out and spent them, e.g.
on housing and automobiles, but also on the latest ‘gadgets’ – e.g. consumer
electronics like televisions, radios, and household appliances.
A post-war baby boom and growing population meant
increased demand.
The move to the suburbs increased demand for
automobiles, household goods, and services.
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Government Policy
The GI Bill provided veterans with low-cost mortgages,
loans to start businesses, and tuition for education, leading to a more skilled
workforce and increased homeownership.
Truman’s ‘Fair Deal’ policy raised the minimum
hourly wage from 40 to 75 cents, and cleared slums for new housing (though
he failed to persuade Congress to improve African-Americans' rights).
President Eisenhower invited businessmen into his
government, and introduced 'Keynesian' economics.
Federal-Aid Highway Act of 1956 which created the Interstate Highway System)
poured money into the economy.
After 1953, the government used surplus
agricultural produce as American foreign aid, selling it to needy nations …
and increasing American farmers' prosperity.
Increased investment in education, especially
higher education, produced a more skilled workforce.
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Industrial
modernisation
Advances in automation and production techniques
increased productivity and efficiency; the average price of a TV dropped from
$500 in 1949 to $200 in 1953. Large corporations
grew, merged and diversified, benefiting from economies of scale.
Heavy investment in research and development led to
innovations, particularly aerospace, electronics, and pharmaceuticals.
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Jobs, wages and Unions
The growth of Unions, along with Truman’s Fair Deal, led to increased wages.
Better wages then allowed increased spending, fuelling further growth.
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Source A
A cereal advert from 1958 offering prizes.
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Consider:
1. Discuss Source A. What does it tell you about
life in America in the 1950s? What can you SEE? What can you INFER?
What does the PROVENANCE suggest?
2. Discuss with the friend: what was 'the American
Dream'?
3. Use the information on this page to write
an 'on-the-one-hand-on-the-other' essay: “Was the ‘American Dream’ a reality or illusion?”
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