The New Era, 1921-1933

New Era is a time in American history the occurred from 1921-1933. It began with the prosperous roaring twenties fueled by Taylorism and pro-business politics, but came crashing down with the Great Depression in 1929, a devastating decline in industrial production and productivity. Most believe that the Great Depression was a direct result of the economic and political activities earlier in the 1920s.

In the 1920s, one of the most important drivers of growth was the implementation by American businesses of a new scientific management principle known as Taylorism (Schulz and Tishler). Taylorism or standardized mass production, was characterized for by formulas for pushing efficiencies in labor, streamlining of tasks and increase in production. Because Taylorism increased worker productivity, worked earned higher wages which they spent on consumption. A new method of credit known as the installment plan emerged, encouraging Americans to build up debt to buy consumer goods. By the end of the 1920s, almost half of the American population owned automobiles, radios, and durable consumer goods such as vacuum cleaners and washing machines (The prosperity of the Coolidge era).

Politically, the presidency of Calvin Coolidge marks the New Era more than any other. Coolidge took office in 1923 when President Harding died and served as president for six years (The Coolidge presidency). Coolidge was conservative, paying off the national debt, eliminating waste and cutting taxes to stimulate capital investment. His political philosophy can best be described as laissez-faire, avoiding intervention in the free market economy. Coolidge converted regulatory bodies such as the Interstate Commerce Commission and the Federal Reserve Board into pro-business agencies that ceased almost entirely to restrict the activities of the industries they were supposed to be controlling.