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History of the U.S. Economy in the 20th Century

History of the U.S. Economy in the 20th Century

Course No.  529
Course No.  529
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Course Overview

About This Course

10 lectures  |  45 minutes per lecture

When Professor Timothy Taylor, managing editor of the prestigious Journal of Economic Perspectives, tells you that the stock market crash of 1929 was not a substantial cause of the Great Depression and that F.D.R.'s New Deal may have actually slowed economic recovery, he speaks with authority and credibility.

Those are only two insights that run counter to common understanding of U.S. economic history. That history is far too interesting—and far too important to our future—to be dismissed with a few stock explanations.

Vital Economic Lessons of the Last Century

This fast-paced course introduces you to vital economic lessons learned in the last century to provide invaluable guidance for understanding the current economy.

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When Professor Timothy Taylor, managing editor of the prestigious Journal of Economic Perspectives, tells you that the stock market crash of 1929 was not a substantial cause of the Great Depression and that F.D.R.'s New Deal may have actually slowed economic recovery, he speaks with authority and credibility.

Those are only two insights that run counter to common understanding of U.S. economic history. That history is far too interesting—and far too important to our future—to be dismissed with a few stock explanations.

Vital Economic Lessons of the Last Century

This fast-paced course introduces you to vital economic lessons learned in the last century to provide invaluable guidance for understanding the current economy.

Each of 10 lectures focuses exclusively on one decade to achieve a clear understanding of economic developments and outside influences on the U.S. economy.

In some cases, you examine well-defined events like the creation of the Federal Reserve or the war in Vietnam. In other lectures, you explore larger societal shifts, such as the evolving role of women in the economy and changing consumption patterns.

"Of course, knowing what happened in economic history does not offer easy answers to today's problems," states Professor Taylor. "Times change; the past rarely offers a perfect template for the present.

"But knowing the history does help discussions about the present to get off on the right foot, free of at least some of the myths and ignorance that can so easily lead us astray. As always in the study of history, knowing where you came from helps us to learn who you are and where you are."

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.

He is the editor-in-chief of the Journal of Economic Perspectives. At Stanford University he won the award for excellent teaching in a large class given by the Associated Students of Stanford University.

At the University of Minnesota, he was named a Distinguished Lecturer by the Department of Economics.

Explore the U.S. Economy Decade by Decade

"An economy operates on many levels, and so must these lectures," states Professor Taylor. "The discussion must touch on the lives of ordinary people: their patterns of consumption, work, and education. It must describe the rise and fall of industrial conditions and unions.

"At the national level, the discussion moves to government budget and monetary policies and the conditions of growth, employment, and inflation. Finally, at the international level, there are issues of how people, capital, and goods flow across borders."

A decade-by-decade course structure includes memorable milestones.

For example:

  • In adjusted numbers, the per capita GDP of 1900 would equal $5,000. This GDP per capita of $5,000 was a fifth of what it was in 2000. This was still a high standard of living.
  • During World War I, the U.S. ran a trade surplus due to an increase in exports, using the earnings to pay off debts and make loans to European countries.
  • In the 1920s automobiles became the country's largest industry and led the way to other inventions.
  • Mismanagement of monetary policy was the main cause of the Great Depression.
  • The Employment Act of 1946 gave the federal government the responsibility to maintain high employment, growth, and stable prices.
  • The broader public policy agenda of the 1950s was quiet. Other than the Korean War, the government enacted few major policies. It is unknown if this economic stability was healthy or stagnant.
  • Productivity slowed down dramatically during the late 1960s and early 1970s and had terrible effects on the U.S. economy.
  • The strangling inflation of the 1970s spilled over into the early 1980s. Federal Reserve Chairman Paul Volcker used a recession to break the inflation.
  • In the 1990s perception of job insecurity differed from reality. Job insecurity led to economic insecurity.

Lecture 1, the 1900s. You discuss the status of both the country and the economy at the turn of the century as well as the role of the federal government regarding mergers, social legislation, and inflation. "Overall," notes Professor Taylor, "this decade is marked by financial chaos."

Lecture 2, the 1910s. You discuss the government's creation of various federal institutions and the consequences that World War I had on both the government and the economy as a whole. You also examine Frederick Taylor's concept of scientific management and conclude with a discussion of the gentle changes in living standards.

Lecture 3, the 1920s. Although titled "The Roaring 1920s," you begin with a discussion of the Recession of 1920-1921. This recession was followed by the consumption boom marked by the transforming technologies of electricity and the automobile as well as developments in macroeconomic policy. It is this boom which then gave the decade its nickname.

Lecture 4, the 1930s. The fourth lecture highlights the Great Depression, which you learn was most likely caused by a mismanaged monetary policy. You also examine the merits of the New Deal and its role in U.S. economic recovery.

Lecture 5, the 1940s. World War II and its aftermath dominated the 1940s. You survey the economic effects of the war and examine how they actually contributed to the country's economic recovery. More specifically, you look at the war's effects on the federal budget and the reshaping of the U.S. economy. You conclude with an examination of the global institutions built by the U.S. to restore trust in the world.

Lecture 6, the 1950s. "Our task in Lecture 6 is to determine whether or not the quiet boom of the 1950s was beneficial for the U.S. economy," says Professor Taylor. You learn that while this decade revealed many healthy signs of prosperity, it remained plagued by controversies and, thus, future economic uncertainty.

Lecture 7, the 1960s. You pick up with the uncertainty as you investigate the 1960s. You look at the various ways that macroeconomic issues influence the way our country is run. You also discuss the building of the Great Society and antitrust and immigration issues.

Lecture 8, the 1970s. This uncertainty takes you to the confusion of stagflation which lingered throughout the 1970s: two recessions and the creation of price controls, floating exchange rates, and expanding global trade. You also closely examine the productivity slowdown of the 1970s.

Lecture 9, the 1980s. You examine the effects of 1970s inflation on 1980s economic stability. This leads into a discussion of the causes and consequences of the budget and trade deficits. You also look at changing market structure and its effects on deregulation.

Lecture 10, the 1990s. To conclude, you focus on misperceptions of the inequality and insecurities of the 1990s and discuss an economic and social agenda for the 21st century.

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10 Lectures
  • 1
    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. x
  • 2
    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. x
  • 3
    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. x
  • 4
    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. x
  • 5
    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. x
  • 6
    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. x
  • 7
    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. x
  • 8
    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. x
  • 9
    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. x
  • 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. x

Lecture Titles

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Timothy Taylor
M.Econ. Timothy Taylor
Macalester College

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.

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Rated 4.7 out of 5 by 34 reviewers.
Rated 5 out of 5 by Things fall into place Another great course from Professor Taylor. I was struck by the way economic events in the history of the previous century influence our current economy in such a direct way. The course provides a thorough and interesting survey of the topic. October 26, 2013
Rated 5 out of 5 by Excellent course that needs to be updated I first listened to this course about 10 years ago, on cassette, when the length of standard lecture was 45mins in length. I recently re-purchased the audio download to re-visit the course. It was excellent then, and it still is. I suspect I will once again listen to these lectures in the future. Yes, it is that good. What this course is not: Economics 101. It is not a history of economic thought or debate in the 20th century. It is not American History. What it is: A history of the US economy, looking back from either late 20th century or early 21st century thinking. Each lecture takes on a decade. I'm not sure if this is the best demarcation of economic events, but it works very well here. This course is standalone, but it will dovetail nicely into any other US History course. You will learn, for instance, how it is that employers pay for health insurance in the USA (Lecture 5 on the 1940s). Prof. Taylor stays away from moralizing about big events -- such as the Vietnam War -- but reflects on them in terms of the economic impact. Prof. Taylor presents and explains the material well. He is first rate. I am, like some of the other reviewers, a repeat buyer of Prof Taylor courses because of this. I am also a repeat listener to his courses in particular. This course if first-rate. ONE BIG DRAWBACK: This course needs to be updated to account for the last 15 years of the century. I suspect it was recorded in the late 1990s or very early 2000s. For instance, in lecture 9, it was still too early to tell about some of the economic policies of the 1980s until we had 20 years of history in which to judge. We have those years now. Lecture 10, on the 1990s, focused more on what was to come in the 21st century rather than on the 1990s. Prof. Taylor seemed to be in the 1990s as so could not really comment on their economic effects. Because this course is now limited to a digital download and there is no "media item" on which to fit lectures, I would suggest updating this course -- especially lectures 9 and 10 -- and then possibly including a lecture 11 on something like "From the 20th Century into the 21st Century: How the economy fared in the 2000s." This would allow Prof. Taylor to clean up the last two lectures and also give him the platform to speculate as he did at the end of lecture 10. January 30, 2013
Rated 5 out of 5 by Great U.S. Econ Overview This was the third of Prof. Taylor's courses that I purchased and it was just as good as the others. Whereas his general Economics course was more a survey of current topics that need to be understood, the focus of this course was more limited but certainly more detailed yet not to the point of losing my interest. As I've mentioned in my other reviews, I have no econ background whatsoever however found this course fun (because of Prof. Taylor) and very instructive - I walked away from it with a good overall understanding of 20th century economics history (and to some extent how 20th century conflicts were based upon it). I plan to listen to this course again to pick up some of the finer details. December 31, 2011
Rated 5 out of 5 by How could it be better? This was the second economics-related course I've taken from The Great Courses, and it was the best yet, as well as the best course of any kind, overall (see ratings). The course description provided as part of its advertising is pretty much on the mark. I found out that some of what I thought I knew was either wrong or misunderstood, and it was mostly in the areas of "common knowledge," mostly regarding the Great Depression. I especially enjoyed Prof. Taylor's enthusiasm as he presented the material. As a result, I'm looking forward to his next two courses. I found his perspective to be quite apolitical, so that it didn't get into the way of the learning at all. That's not a mean feat, given that modern history and economics are tightly entwined with politics, and government intervention in economic systems has become so common as to become accepted as appropriate, even when it isn't. So, how COULD it be better? I thought there were only two weak areas in the lectures (perhaps because they were the ones I'm most familiar with). First, Taylor didn't give enough attention to the paradigm shift in taxation/economic theory that was attempted by President Reagan, and the fact that although sweeping, it was far from complete, nor did it completely "take." He DID bring out some little understood nuances of the Volcker recovery and the transition period between the Carter and Reagan presidencies. Second, the final lecture on the nineties was the weakest of all, perhaps because it was delivered during the time period it covered or very soon thereafter. Without enough time to age in history, that decade's economic history is probably still being written. I don't see what Taylor could have done about that, though. I found his argument that we need to add more emphasis to K-6 education to improve our chances of success in the competitive world to be very interesting, and not one I've heard before. I liked the chronologically restricted format. My thought would be that the material was perhaps a bit rushed, all the way through the course. As opposed to some other Great Courses (which can be mind-bogglingly long), maybe this one is too short and should be expanded a bit, with a thirty-minute lecture covering each five year period. That would expand it to twenty half-hour lectures, twenty-two if he were to add the first decade of this century. I realize that it is probably impractical to re-do this course in the way I suggest; however, if it were to be revised and upgraded, it could be left "as is" through 1980, then perhaps redone as lectures organized by Presidential terms. Given that we often think of economic events in terms of the Presidents who were involved with them, and we assume that the Presidents have some effect on them, that might be an interesting way to bring us forward into the current decade. I acknowledge that there are drawbacks to such an approach as well, but I would buy that kind of upgrade. September 24, 2011
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