ECON 220 LEC American Economic History

Two principal and five secondary “big ideas” of American economic history

 

Secondary “big ideas” American Economic History

Introduction

Modern economic development in America is based upon fourteen big ideas that have been implemented over the years. They have contributed to a remarkable economic evolution in America. This essay discusses Structural transformation and social democracy as the two principal “big ideas” that have made a significant contribution to the growth of American economy. It also discusses immigration, liberty, opportunity, gilded age and slavery as the secondary “big ideas” of the American economic history.

Two principal “big Ideas” of American Economic History

Structural transformation and social democracy are the principal two ideas because they are the foundations of economic evolution in America. The reason why I chose these two main ideas over the others is that the other ideas came as result of these two big ideas. The existence of the secondary ideas depends on the two principal big ideas. The secondary big ideas were less central because they acted as catalysts of industrialization and social democracy. The gilded age, for instance, resulted in massive growth of industries in America since many skilled workers from other European countries migrated to America where there better wages. They provided adequate labour thus encouraging industrial growth. Without industrial revolution, the American economy would not have grown rapidly as it did. Before the coming of the industrial revolution, the American economy was mainly agricultural based. Among the products that America used to trade with were tobacco, fur, lumber, minerals, and fish. The first industrial revolution began in Europe in the 18^th century, and England benefited from the revolution and became the first industrial power in the world. The second industrial revolution in the early 19^th century reached America, and it was established as the as world industrial power. The industrial evolution led to the development of major urban centers such as Boston and New York which led to massive migration from rural areas to urban Areas. The industrial revolution resulted in the establishment of capitalism which became the dominant economic principle in America.

Many industries were established where workers exchanged their labor for hourly wages. Capitalism brought about the accumulation of wealth by the industrialist. Fluctuation of the consumer market determined whether they made losses or profits. Industrialization helped America utilize its vast resources and became a leading economy taking advantage of the internal and international markets.

On the other hand, Social democracy has helped the formulation of economic and social interventions that have assisted in promoting social justice in a capitalist economy which resulted from industrialization. Social justice also recommends the establishment of policies that support representative democracy, income redistribution regulations as well as economic regulations that will consider the wellbeing of the whole state.

Social democracy brought about political reforms in America which aimed at eliminating problems that came as a result of industrialization, urbanization, immigration and corruption. It led to the establishment of laws that would prohibit the large industries to bring about monopoly in the market thus allowing fair completion in the market which would help smaller industries to grow.  Social democracy also advocates for efficiency in production which would also lead to better wages for the workers. Social democracy resulted to the American Apogee which encouraged entrepreneurship. There were more opportunities for people with entrepreneurial spirit. Unlike European countries, America had a relatively open classless society which enabled individuals to engage in entrepreneurship.

Secondary “big ideas” American Economic History

Immigration, liberty, opportunity, gilded age and slavery are the big secondary ideas of American economic history. This is because they were influenced by the industrial revolution that took place in the 19^th century and others such as economic liberty and opportunities came as a result of social democracy. During the colonial era, many immigrants moved to America seeking for greater economic opportunities. During this period many Africans were brought to America to work as slaves. They provided adequate cheap labor which led to the growth of industrialization. In the period between 1880 and 1920 rapid industrialization was taking place in America and America received many immigrants most of whom came from Central Eastern and Southern Europe. Immigrants increased the labor force in America and industries could invest and expand their productive capacity. Highly educated immigrants also contribute significantly to innovation. Immigrants make America an interesting place since it brought people from different nationalities with different qualities thus giving America a strong edge to the utopian strain.

 The American constitution gives the citizens freedom such as freedom of speech and debate which allows people to express their views and opinions freely, freedom of religion, freedom of movement and settlement and freedom to get employed. The constitution protects property and the opportunities to acquire property thus giving Americans economic liberty. Economic freedom has contributed to the growth of the economy which has led to better wages for the workers thus improving their economic status. The downside side of the American liberty is that it gives no restrictions on individuals they may, therefore, act against the state or other people for their gain. For instance, freedom of speech can negatively impact the rights of others through hate speech, false advertisement, incitement and revealing state secrets. Therefore, freedom needs some restriction to protect the wellbeing of others and the state.

America provides more economic opportunities to its citizens. The most significant economic opportunities in America include; Availability of energy, free trade, advanced technology, excellent infrastructure and talent development. This has also attracted many people from other countries to invest in America which has also contributed to rapid economic evolution.  Economic growth in America most specifically before 1945 enabled American natives from all backgrounds to attain upward social mobility. The gilded ages provided better opportunities for economic development to the people. However, in the recent years intergenerational vertical social mobility has decreased in America this has been attributed to by income inequality. Education has become expensive, and there is no equality of opportunity unlike in the past.

During the gilded age wages in America especially for skilled laborers were higher compared to salaries in the European countries. This attracted many immigrants from Europe to America. This led to rapid industrial growth due to the availability of labor. During this era, major developments such as railway took place which joined the isolated areas with larger markets which led to the rise of commercial farming ranching and mining. Also, steel production increased in America and became the highest in the world exceeding that of Germany, Britain, and France combined.

Slavery in America also played an important role in economic development. Slaves worked on the farms where cotton was grown which then used to provide 50 % of all America’s export earnings. Slavery also led to increased production of iron and manufactured goods in America.  Africans during the slavery period in America were stripped off their human rights they were whipped and mistreated for about two centuries. The invention of the cotton gin in 1793 led to increased slavery. In the 19^th century, anti-slavery movements started in America which provoked a national debate over slavery this contributed to the emergence of American civil war from 1861 to 1865, after which four million slaves were freed in America. Jim Crow was a term that resulted from a performance of a struggling American white actor who performed blackface makeup as “Jim Crow.” Jim Crow then became a less offensive term to describe the blacks. In the 19^th century, Jim Crow was used in describing laws and customs that oppressed the blacks.

Conclusion

 In conclusion, structural transformation and social democracy are the major contributors to American economic history. They form the basis for other secondary ideas. The two principal ideas ignited a social and economic revolution in America, and they were supported by other secondary big ideas to bring about a remarkable economic change in America.