Introduction to the 1920s
The 1920s was a time period that contrasted greatly with the Progressive Era. Three conservative presidents led the United States during this time period under the philosophies of Laissez Faire and rugged individualism. Under these philosophies, large corporations were not regulated, and individual citizens did not receive government support. The government was not involved in the American economy. In contrast to the active government of the Progressive Era, the level of government involvement in the economy during the 1920s decreased and the lack of involvement resulted in the beginning of the Great Depression. The 1920s was a time of false prosperity. The economy appeared to be rapidly growing, when in reality the economic situation in American was worsening. Americans spent more money than they had, and sunk into dept. The stock market, a major part of the American economy, crashed in 1929, which worsened the financial situation in the U.S. In the 1930s thousands of banks failed, causing many Americans to lose all of their savings. As a result of the bank failures, many American citizens lost their jobs. The high unemployment rate, bank failures, stock market crash, and false prosperity were all caused by the lack of government involvement. These factors compiled together to cause the Great Depression.