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CHAPTER
The Business of America
12 GUIDED READING

Section 3

A. In the first column, write notes to describe how the inventions and trends of the
1920s changed American life. In the second column, write the name of a related
company or product that contributed to the boom of the 1920s.

Invention or Trend Effects of the Invention or Trend Company or Product

1. Automobiles

2. Airplane industry

3. Alternating
electrical current

4. Modern advertising

5. Installment plan
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B. Why should Americans in the 1920s have shown greater concern for their future?
Note three things that were, or might have been, seen as “clouds in the blue skies
of prosperity.”

1. 2. 3.

C. On the back of this paper, explain the meaning of urban sprawl.

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CHAPTER
The Business of America
12 RETEACHING ACTIVITY

Section 3

Multiple Choice

Choose the best answer for each item. Write the letter of your answer in the blank.

_____ 1. The president who said “the chief business of the American people is business” was
a. Warren G. Harding.
b. Calvin Coolidge.
c. Herbert Hoover.
d. William Howard Taft.

_____ 2. The mode of transportation that began as a mail carrying service for the U.S. Post Office was the
a. automobile.
b. airplane.
c. train.
d. bicycle.

_____ 3. During the 1920s, Americans’ average annual income rose by about
a. 10 percent.
b. 15 percent.
c. 25 percent.
d. 35 percent.

_____ 4. The famous Route 66 stretched from Chicago to

a. California.
b. Wyoming.
c. Utah.
d. New York.

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____ 5. The man known for making a historic transatlantic flight was
a. Henry Ford.
b. Will Rogers.
c. Charles A. Lindbergh.
d. F. W. Woolworth.

_____ 6. One industry that did not prosper during the 1920s was the
a. farming industry.
b. advertising industry.
c. airline industry.
d. automobile industry.

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CHAPTER GEOGRAPHY APPLICATION: REGION

12 The Automobile Industry: Sign of the Times

Section 3 Directions: Read the paragraphs below and study the graph carefully.
Then answer the questions that follow.

faster production. Early in the decade, 90 percent

T he automobile industry has been the single
most important industry in the United States
since the 1920s. The value of its products exceeds
of all the world’s cars were made in the United
States. By 1930, about 23 million cars were regis-
that of any other industry, and a prolonged decline tered in the United States, nearly three times the
in car sales is usually a sign that the entire U.S. number registered just a decade earlier. The pro-
economy is headed for rough times. duction of automobiles in 1929 was not surpassed
So many other industries—such as those pro- in any single year until 1949.
ducing oil, steel, rubber, plate glass, machine tools, Municipal governments scrambled to provide
plastics, and aluminum—are dependent on auto- roads for the growing numbers of cars. To pay for
mobile production that cars are vital to the nation’s the aggressive road-building campaign, property-tax
economic health. For example, a very high percent- revenue was soon supplemented by heavy borrow-
age of the steel, rubber, and plate glass produced in ing and by the use of state funds. In the 1930s, the
the United States winds up in cars. Businesses such idea of tolls as a source for highway revenue had
as road construction and car-insurance firms, filling caught on.
stations, and car-repair shops owe their existence Though the number of automobile registrations
entirely to the automobile. The lodging industry reveals the general health of the U.S. economy, a
would be much less widespread today without graph of automobile production reveals the fine
motels. (The word motel was created around 1925 points—the smaller ups and downs within boom-
as a blend of motor and hotel.) and-bust cycles. For purposes of contrast, the fol-
The 1920s were a period of dramatic economic lowing graph shows automobile production for the
growth. Prices for cars actually fell during the decade of the 1930s as well as for the 1920s.
decade, as assembly-line techniques permitted

Two Decades of Automobile Production

5
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4
Number of automobiles
(in millions)

1921 1922 1923 1924 1925 1926 1927 1928 1929 1930 1931 1932 1933 1934 1935 1936 1937 1938 1939

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Name The Automobile Industry continued

Interpreting Text and Visuals

1. Characterize the general economic conditions in the United States during the
decades of the 1920s and 1930s. __________________________________________________

2. In what year was automobile production the highest? ________________________________

About how many cars were produced in that year? __________________________________

How many years did it take for annual sales to surpass that total? ______________________

3. What were the years of greatest economic decline between 1921 and 1939? ______________

4. Describe the production of cars in 1932, in comparison to other years. __________________

5. Between 1921 and 1929, there were two 13-month periods of economic downturn.
During what years do you think they occurred? ______________________________________

6. What do you think happened to the economy in 1937–1938? __________________________

© McDougal Littell Inc. All rights reserved.

Compare this period with the periods of 1923–1924, 1926–1927, and 1929–1932.

7. What might have spurred car production again after 1932? (Hint: Think about
the durability of the average automobile.) __________________________________________

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CHAPTER PRIMARY SOURCE Advertisement

12 In the 1920s, advertising developed methods it continues to use today, over half
a century later. Ads like Ned Jordan’s 173-word classic, “Somewhere West of
Section 3 Laramie,” used poetic language to glamorize automobiles. Who might this ad
appeal to?

© McDougal Littell Inc. All rights reserved.

Corbis-Bettmann

Activity Options
1. With a small group of classmates, analyze this ad. 2. Find a car advertisement in a recent issue of a
What images and persuasive language does it magazine. Then do a side-by-side comparison
use to sell the car? What attitudes does it por- for the class in which you point out similarities
tray? What information about the car does the and differences between the car ad you found
ad include? and Ned Jordan’s ad.

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CHAPTER AMERICAN LIVES Henry Ford

12 Engineer with a Vision
Section 3 “[M]ake money and use it, give employment, build factories, and send out the
car where the people [can] use it. . . . Business is a service, not a bonanza.”
—Henry Ford, on his view of the goals of his business (1916)

workers more, he offset the boredom of the assem-

H enry Ford (1863–1947) did not invent the
automobile. He did not invent the assembly
line. What he did was to use his engineering skill to
bly line by giving them the resources to afford to
buy his cars. Still facing some opposition from
develop a reliable car and to devise a method of other investors, Ford bought out other stockholders
manufacturing it that was cheap. In doing so, he and put control firmly in the hands of himself and
achieved his vision—to put a steering wheel in the his family. The cost was $105 million.
hands of ordinary people. Ford suffered setbacks too. During World War
Ford was born on a farm outside Detroit and I, he sponsored a “peace ship” that hoped to con-
loved the peace of the countryside. He disliked vince nations to stop the fighting. The idea failed
farm work, though–machines interested him. At miserably. He also became notorious for his
16, he began to work in a machine shop. From that extreme views, especially his hatred of Jewish peo-
job and others he improved his knowledge of steam ple. Some workers resented the company’s
power and electrical systems. Meanwhile, he began “Sociology Department.” This group was set up to
to tinker with developing an automobile. In 1896, help workers—many of them immigrants and many
he completed his first, the “quadricycle,” in a small uneducated—live thrifty lives. However, the staff
shed. After knocking out part of the wall—the often intruded in the workers’ lives. Finally, during
vehicle was too wide for the doorway—he drove the 1920s, sales dwindled as consumers preferred
his first car onto the street. flashier cars from other companies.
Ford sold the car for $200 and immediately In 1927, Ford shut down his factories and
began making another. Though his first two helped design a new car—the Model A. It was an
automaking companies failed, he earned a reputa- instant but short-lived success. The depression
tion as a skilled engineer. In 1902 Ford got the severely hit Ford’s company. By the mid-1930s,
financial backing for a third company. Its first car Ford was only the third biggest automaker. In addi-
was released in 1903. However, the investors want- tion, the company had a poor labor-relations
ed to sell cars to the wealthy—who bought most of record. It suppressed union organizers until finally
the cars sold at the time. Ford wanted to make cars allowing a union in 1941.
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with mass appeal. He bought out these investors Ford, meanwhile, devoted himself mainly to a
and in 1908 introduced his dream: the Model T. new project. He founded a historical museum and
For almost 20 years, the Model T dominated the village. This collection of homes and other build-
auto industry. By cutting costs, Ford was able to cut ings celebrated and preserved the values and
its price—from $1,000 in 1908 to only $345 in lifestyle of nineteenth-century rural America—the
1916. The durable, cheap “Tin Lizzie” became the life that Ford’s car had changed entirely. After 1938
everyday car of ordinary Americans. Much of the Ford mostly gave control of his company to others
reduced cost of the Model T is attributed to Ford’s before officially retiring in 1945.
unique assembly-line construction that eliminated
unnecessary motion through simplified operations.
Ford also had another type of improvement up
Questions
his sleeve. In 1914 he stunned American industry 1. Hearing of the $5 day, a publisher said “He’s
by announcing that he would pay workers $5 a day. crazy, isn’t he?” Why did Ford’s action get such a
As auto workers in Detroit were being paid from reaction?
$1.80 to $2.50 a day, Ford’s new wage was revolu- 2. Assess Ford’s contribution to industry.
tionary. Ford’s reasoning was simple: by paying 3. Do you think Ford was a good employer? Explain.

Politics of the Roaring Twenties 19