The history of the U.S. economy in the 20th century is far too interesting - and far too important to our future - to be dismissed with just a few stock explanations. These 10 fast-paced lectures introduce you to vital economic lessons learned in the last century to provide invaluable guidance for understanding the current economy. Each lecture focuses exclusively on one decade to provide you with a clear understanding of economic developments and outside influences on the U.S. economy. In some cases, you'll examine well-defined events like the creation of the Federal Reserve or the war in Vietnam. In other lectures, you'll explore larger societal shifts, such as the evolving role of women in the economy and changing consumption patterns. This decade-by-decade approach takes you deep inside America's memorable economic milestones. Among these: the U.S. trade surplus during World War I; the rise of the automobile industry in the 1920s; the mismanagement of monetary policy that led to the Great Depression; the Employment Act of 1946, which gave the federal government the responsibility to maintain high employment and economic growth; the strangling inflation of the 1970s and early 1980s; and more. Professor Taylor takes care to ensure that you can follow this course clearly regardless of your knowledge of economics. He uses historical examples and quotes from economists and other notables, and his use of economic reasoning often brings surprising insight.
History of the US Economy in the 20th Century
01: The Curtain Opens on the 20th Century
This introductory lecture previews the course. Beginning with the 1900s, we look at the demographics and economics of the time and make comparisons to the present day. This leads into a discussion of the popular issues of the decade. We look at the federal government and how it began its role in economic policy. We examine how inflation, the gold standard, and the Panic of 1907 led to financial chaos.
02: Big Government Is Conceived—Income Tax, the Federal Reserve, World War I
During the second decade of the 20th century, the government created and developed institutions that shored up the country's economy, including the federal income tax, the Federal Reserve, and antitrust legislation. World War I transformed the United States into an international creditor and increased both government spending and revenue. The government created a federal debt ceiling, regulated labor, and nationalized certain industries. Finally, the war boom led to a recession. Meanwhile, both business and government adapted Frederick Taylor's ideas of scientific management.
03: The Roaring 1920s
Before discussing the decade's boom, we examine the causes and consequences of the recession of 1920–21. Electrification and the automobile fed a consumption boom and greatly affected the U.S. economy. Also, the government and the Federal Reserve used macroeconomic policy to spur growth that led to virtuous circles which in turn led to increased inequality. Limits on immigration, expansion of the education system, and the electrification of industry affected labor conditions. Finally we learn about the connection between economic growth and rising wages, and the importance of putting economic transformations into perspective.
04: The Depression Decade of the 1930s
This lecture describes both the notoriety and the causes of the Great Depression. Causes included the stock market crash, a decline in aggregate demand, and most importantly, mismanagement of monetary policy. We discuss the major elements of the New Deal and assess their merits and economic viability. While many of the regulations created during the 1930s benefited society, they did little to produce an economic recovery.
05: The 1940s—World War II and its Aftermath
This lecture discusses how World War II led to tremendous growth but was not the sole factor in ending the Great Depression. The war did expand the income tax, raise the government debt, and increase the size of the federal government. It also reshaped the economy as a whole; the government intervened in markets, unions grew, jobs shifted in nature, wages compressed, labor markets for minorities changed, health care spending rose, and the baby boom began. Finally the U.S. government contributed to rebuilding global institutions by developing the Marshall Plan, the International Monetary Fund, and the General Agreement on Trade and Tariffs.
06: The Quiet Boom of the 1950s
The lecture starts with a summary of the first half of the century and then a discussion of the economy of the 1950s. This decade, realized healthy growth but also produced a feeling of stagnation as unemployment, inflation, and public policy slowed as the 1950s neared a close. The decade had both health as well as difficulties that would persist throughout the rest of the century. Healthy signs included gains in wealth, science, technology, and education, and a decline in the poverty rate. But concerns rose about the military industrial complex, urban decline, exposure to foreign trade, unionization, and the growth of service sector jobs.
07: The 1960s and the End of Certainty
In this lecture we discuss how macroeconomic uncertainty affected the economy. Tax cuts, as well as increased military and social spending, marked this decade. Similarly the Great Society was established, based on the Civil Rights Act of 1964, Medicare and Medicaid, the War on Poverty, the expansion of the regulatory state, and scientific research and exploration. Finally, sentiment toward antitrust and immigration changed.
08: Stagflation and the 1970s
Snarling inflation and roaring stagflation marked the 1970s as wage and price controls combined with oil shortages led to two recessions. The decade also faced a return to the global economy as the country instituted both floating exchange rates and increased global trade. Most importantly, a major slowdown in productivity affected the 1970s. Finally the government enacted new welfare entitlement programs, such as Medicare and Social Security.
09: A Decade of Debt—The 1980s
The early 1980s still felt the effects of 1970s inflation. Federal Reserve Chair Paul Volcker used recessions to finally end the devastating inflation. We discuss how a combination of increased defense spending, the income tax cut, the expansion of Social Security, and the higher government interest payments caused the trade and budget deficits. The consequences of these deficits included the crowding-out of domestic investment, the growing trade deficit, the returning of the United States to debtor nation status, and the slowing of long-term growth. Finally markets changed as deregulation hit the airline, savings and loan, and oil industries. Also, IBM and AT&T faced antitrust concerns, and the popularity of mergers and leveraged buyouts increased.
10: Inequality and Insecurity in the 1990s
This final lecture compares the current standard of living with the one at the turn of the century. We discuss the largely misunderstood insecurities of the 1990s workplace. The decade began with low job growth and a minor recession, and a boom in mergers and increased inequality also contributed to a feeling of insecurity. We discuss a possible economic agenda for the 21st century. We discuss the prudent use of monetary policy to prevent inflation and recessions, the benefits of opening global trade, and the importance of reducing the federal budget deficit. Also we discuss the power of markets and the importance of planning for the aging of the baby boomers, getting the most out of all people in the workforce, and nurturing the various seeds of growth.
Overview Course No. 529
About
Professor Timothy Taylor is Managing Editor of the prominent Journal of Economic Perspectives, published by the American Economic Association. He earned his Master's degree in Economics from Stanford University.
Professor Taylor has won student-voted teaching awards for his Introductory Economics classes at Stanford University. At the University of Minnesota, he was named a Distinguished Lecturer by the Department of Economics and voted Teacher of the Year by the Master's degree students at the Hubert H. Humphrey Institute of Public Affairs.
In 2007, Professor Taylor published the first Principles of Economics textbook, available as a free download from Freeload Press. He has also edited a wide range of books and reports and published articles on globalization, the new economy, and outsourcing. From 1989 to 1997, Professor Taylor wrote an economics opinion column for the San Jose Mercury-News.
