Roaring Twenties

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Graphs! But first, some Flapper art.

The percentage of wealth owned by the rich during the '20s was at a peak.

Horse-and-Sparrow Trickle-down Mellonomics at work. Shaded area indicates recession.

GDP per capita in the '20s.

The Roaring Twenties (aka Roaring '20s or the Jazz Age) refers to the period of economic expansion in America and Western economies in general during the 1920s. Because the grade-school version of the Roaring '20s tends to boil down to "good times 'n flappers," further wingnut and Fox News revisionism has built on top of this to paint the period as a new golden age.

Myths about the 1920s

Political mythmaking

Right-wing myths about this period often draw on the "work" done by Amity Shlaes in her book The Forgotten Man. The Roaring '20s came to an end in this alternate-universe history when FDR Herbert Hoover passed the Hoot-Smalley Smoot-Hawley Act.

Pseudohistorical wingnut claims are usually a variation on one of these points:

• "Harding/Coolidge got us out of a depression with tax cuts/by doing nothing." Depending on how historically illiterate the bullshitter is, they'll mix up the presidencies of Harding and Coolidge a la Bachmann. See the Depression of 1920 for a full debunking of this point.
• "The rising tide lifted all ships. Everyone got richer." One simply needs to look at the numbers to find that this claim is highly misleading. Workers' income rose 11% from '23-'29, but the wealthy enjoyed by far the greatest gains. Harding and Coolidge's economic plans were largely the work of Treasury Secretary Andrew Mellon. Mellon's big idea was massive tax cuts. The cuts went to the poor and the wealthy, but the rich got the bulk of relief spoils with their taxes dropping from 70+% to around 20%, while the poor had their taxes cut only by a few percentage points. This was nicknamed "Mellonomics," which was really just "horse and sparrow theory" in a new suit. This was later repackaged in the 1980s as "Reaganomics."
• "Coolidge was a real small gummint president. Hoover was a commie who screwed everything up." Glenn Beck loves this one. See Hoover's page for a debunking of this point.

The Twenties as a golden age

• Although the decade saw sustained growth when taken as a whole, the economy actually went into recession four times during the '20s.
• Nearly half of Americans were farmers or otherwise employed in agriculture. The '20s marked the beginning of the decline of the American farmer as demand for foodstuffs fell at the end of World War I and the beginnings of the Dust Bowl hit. Farmers came to rely on credit to scrape by, and this only got worse in the '30s.
• Increasing reliance on credit and stocks in general. The early 20th century is often called the "Second Industrial Revolution", differentiating itself from the first by advances in mass production techniques and a focus on consumer products rather than heavy industry. Those who saw their wages rising bought up new consumer products like radios and telephones like crazy. However, those who couldn't afford them used credit and "buy now, pay later" programs to stock up on these products. The stock market became the new "hot thing" and financial "entrepreneurs" encouraged heavy investment in the market. This didn't work out so well by 1929.
• Widespread fraud in the financial and banking sectors. Scammers, swindlers, economic woo-meisters, and crooked banksters of all types ran wild during this period. This corruption wasn't uncovered until the Pecora Commission under Hoover and FDR, which eventually led to the creation of the SEC to prevent this sort of financial fraud.
• The Florida land boom. In the early 20s, land speculators began building huge developments in Florida, especially around Miami. Large swaths of the Everglades were drained, streets with underground utilities were laid, and thousands of build-to-order lots were sold. While some developers were legitimate, others built houses of ticky-tacky, while others just took the money and ran. This led to one of the first housing bubbles large enough to acquire national fame. The bubble — actually, the first of a series of bubbles — burst in 1925. Major hurricanes in 1926 and 1928 and the stock market crash of 1929 only served to accelerate the collapse. The infamy of this particular land boom lingered for more than 50 years. Even as late as the 1980s, it was not uncommon for Americans who heard a spiel from a con artist or a gullible person to respond by saying "Yeah, and I've got some swampland in Florida I'd like to sell you." And for decades it was also common to see houseless streets and town plats from the air, although many have since been overgrown.
• Despite the trust-busting of the Progressive Era, the economy was still plagued by a number of oligopolies. Some economic historians claim that the recession of 1927 was caused by Henry Ford temporarily shutting down his factories to retool them and switch over production from Model Ts to Model As.
• It's rather ironic for social conservatives to be waxing nostalgic about the Roaring '20s considering:
  • Lax morality and changing gender roles. The flappers were trend-setters who acted more like men, i.e., smoking, drinking, being more independent in general, and playing a more dominant role in relationships.
  • Prohibition caused infamous gangsters like Al Capone to rise to power. And with the advent of speakeasies, people still drank. A lot.
  • The first Red Scares began in the late teens and early twenties.
  • Moral panic over "jazz culture" because of its roots in black culture and marijuana scares.

External links

• economy, a statistical portrait
• Roaring Twenties