A Brief Economic History of North America!

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A Brief Economic History of North America!

• Sections
• 1. Exploration and Conquest (up to 1400s /-)
• 2. Colonization and Exploitation (1400s to 1770s)
• 3. Revolution and New Government (1770s to the
  late 1700s)
• 4. US Expansion (late 1700s to 1850s)
• 5. Civil War (1850s to 1880s)
• 6. Development of the Nation (1800s to 1920s)
• 7. Venturing Abroad (1880s to 1920s)
• 8. Looking Inward (1920s to 1940s)
• 9. Super Power and Beyond (1940s to Present)

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A Brief Economic History of North America!

• This is Not a history class! Why are we studying
  this?
• You are correct. This is not a history class,
  but many of the economic issues we will discuss
  in this class have been substantially impacted by
  what has happened from a historical perspective.
• Examples
• Why are there 3 primary languages spoken in
  N.America?
• Why were there great difficulties in creating
  NAFTA from a legal perspective?
• Why are the 3 countries substantially different
  in terms of economic development?
• Etc.
• The following slides and lecture will provide a
  VERY brief history of the North American
  continent. It will focus on many broad themes
  encountered when exploring the economic history
  of the region and will eventually lead up to how
  they impact todays current business environment.

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Exploration and ConquestEuropean Explorers

• Starting in the 1400s, waves of European captains
  set out to explore the world.
• The primary goals behind this exploration were
  primarily
• Gain economic wealth
• Find/develop trade routes to the East Indies
  (China and the Far East)
• Conquer new territories for nature resources and
  markets
• Spread the Christian Religion
• Intellectual Curiosity
• Adventure

4
Exploration and ConquestEuropean
Explorers/Conquerers
Spanish Columbus (1492 ) Cortez (1519) Pizarro (1532) French Jacques Cartier (1530s) English John Cabot (late 1400s) Sir Walter Raleigh (1584) Russian Vitus Bering (1729)
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Colonization and ExploitationSpanish / French /
English
Spanish French English
Brought Mexico, current US South and SW under control Starting in 1541, France began to colonizing North America with forts and trading posts. Starting in 1585, England established 13 primary colonies on the eastern seaboard.
Ecomienda system with Indian labor digging mineral wealth from the ground to ship back to Spain The colonies were developed to export products such as fish, sugar, and furs. Economic value Major source of raw materials Forced market for English goods and a tax base
6
Colonization and ExploitationEuropean Wars
Impact the New World

• European powers had many armed conflicts in the
  late 1600s to the 1800s. These conflicts,
  although started in Europe, often spilled over
  into the New World.
• The principle conflicts are known as the French
  and Indian Wars. These conflicts were a series of
  4 wars fought between 1688 and 1815 by the
  expanding French and British colonies as they
  contended for control of the western, or
  interior, territories.
• These conflicts ultimately decided the control of
  French possessions in North America. The English,
  through capture of Montreal in 1760, took most of
  French Canada. This weakened Frances control on
  the rest of their possessions in North America,
  eventually leading to their purchase by the
  United States.

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Colonization and ExploitationOther Economic
Issues

• Economic Base
• Canadian and New England Colonies
• Shipbuilding / Fishing / Lumber / Farming / Furs
• Mid Atlantic Colonies
• Shipbuilding / Farming / Trading
• Southern Colonies
• Cash Crops (Tobacco, Rice, Indigo)
• Mexico Gold, silver
• These goods are then shipped to their home
  countries in exchange for manufactured goods.
• Labor
• -Although most of the labor in Northern N.Am.
  Came from settlers, many were indentured servants
  or slaves.

8
Colonization and ExploitationOther Economic
Issues
Triangular Trade Route - Fueled the growth of
slavery in the Americas and provided much needed
labor. Slave traders brought Africans to
the Americas Rum and sugar cane from the
Americas went to Europe Sales of these
products provided money to European slave traders
to capture and transport more Africans to the
Americas.
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Revolution and New Govt.War with France Effects

• Although the French and Indian War provided
  increased British control over the New World, it
  also started the process for the new American
  colonies to revolt.
• Gave the colonies a chance to unite against a
  common enemy.
• Provided colonies opportunities to increase ties.
  
• Left large numbers of British troops in America.
• The war was Extremely costly for the British and
  caused them to impose many taxes on the colonies
  to recoup their expenses. This issue proved to be
  the key that caused the revolt.

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Revolution and New Govt. What were points of
conflict?
Other taxes were also levied, further angering
colonists.
11
Revolution and New Govt.Colonial Response to
Taxes

• Due to the increasing amounts of taxes, colonists
  began to boycott British goods and anti-British
  sentiments ran high.
• Events, such as the Boston Massacre (1770) or the
  Boston Tea Party (1773), began to occur as the
  colonists started resenting and resisting against
  British rule.
• The Boston Tea Party was a case where the British
  crown granted the East Indies Trading company an
  exclusive monopoly on the American market. Due to
  increased prices and taxes relating to this
  market, the colonists struck back through
  boycotts and violence.

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Revolution and New Govt.The Next Step

• The crown further increased pressure to force
  obedience.
• First Continental Congress (1774)
• Called for each colony to begin training troops.
• Voted to ban all trade with Britain until the
  Intolerable Acts ended.
• Planted the seed for a future independent
  government.
• The Shot Heard Round the World (1775)
• British tried to disrupt colonial militarization
  in Concord, MA and were repulsed.
• Seen as the first real battle of the War for
  Independence.
• Declaration of Independence (1776) - Thomas
  Jefferson
• We hold these Truths to be self-
• evident that all Men are created equal,
• that they are endowed by their Creator
• with certain unalienable Rights, that
• among these are Life, Liberty, and the
• Pursuit of Happiness

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Revolution and New Govt.WAR!!!

• The Revolutionary War (USA name) or the American
  Revolt (British name) was fought between
  4/19/1775 to 10/17/1781 (or 9/1783 for the final
  treaty.
• Negative
• 1/3 of the people didnt want a war and 1/3 were
  neutral.
• Each colonies was loyal to itself, not to the
  USA
• No central govt. to raise money for war efforts
• Started with no formal, trained army.
• Positive
• Colonies received assistance from France, the
  Netherlands and Spain
• Home court advantage
• War of attrition and distance

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Revolution and New Govt.Aftermath

• The war left the new nation with some problems.
• The Revolution had cost a lot of money, and
  Congress had borrowed from foreign sources and
  American citizens. Now the money needed to be
  repaid.
• Setting up a central government to deal with debt
  and other national issues was going to be
  complicated. The Continental Congress would meet
  many times to discuss economic issues and a new
  system of government.
• This new central government would prove to be a
  struggle between Federalists (those favoring a
  strong central government) and Anti-Federalists
  (those favoring a system based on stronger state
  governments)

• The Federalists, led by Adams Hamilton,
  believed in a strong national government and
  industrial economy and were supported by bankers
  and business interests in the Northeast.

• The Democratic Republicans, led by Thomas
  Jefferson, believed in a weaker national
  government and an agricultural economy. They were
  supported by farmers, artisans, and frontier
  settlers in the South.

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Revolution and New Govt.Aftermath

• The US Constitution was finally passed in 1787
  and was followed by the Bill of Rights in 1791.
• The Constitution was the official framework upon
  which the government was built, ie. the balancing
  of the Executive, Legislative and Judicial
  governmental branches, etc.
• The Bill of Rights guaranteed the basic liberties
  of American citizens, ie. freedom of speech,
  press, religion, etc. as well as no taxation
  without representation.

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Revolution and New Govt.Economic Implications

• Exports and Imports Wholesale Price Index

17
American Exports, To From Britain 1783-1789
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Revolution and New Govt.Beginnings of the
National Debt

• The first Secretary of the Treasury, Alexander
  Hamilton, pushed for the new nation to borrow
  money.
• He thought that the war debts must be paid off to
  establish good credit and faith in our new
  government, plus, it was to enforce strong ties
  between all the states by jointly owing money.
• He also believed that govt. needs the support of
  the business people to remain strong.
• His report to the President on the proposal to
  establish a national bank included the following
  message on business in America

• Industry is increased, commodities are
  multiplied, agriculture and manufacturers
  flourish and herein consists the true wealth and
  prosperity of a state.
• Report on a National Bank, Dec. 13, 1790

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US ExpansionMoving West

• There had been a lot of pressure on the colonies
  and then the new USA to expand. Settlers wanted
  more and more land to settle, this led to land
  purchases by the US.
• The first purchase was the Louisiana territory
  owned by France.

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US ExpansionSouthern Expansion

• The next expansion came with the military
  acquisition of Florida from Spain in 1818.
• In 1836, Texas had won it freedom from Mexico and
  had voted to become part of the US in 1846. The
  US Army won a short war with Mexico when it tried
  to reclaim the territory.
• Further territory was purchased in 1853 for its
  mining and railroad uses.

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US ExpansionUS, UK and Russia

• More territory was acquired or ceded by the UK
  (Canada) and Russia to make up the current
  borders.
• With this expansion, there were no other lands to
  move into.
• This completion caused a number of issues.

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Westward ExpansionEarly 1800s Trends

• US Westward Expansion
• Encouraging Factors
• Canals
• Railroads
• Economic Development
• Manufacturing Capability Developed in the North
• Steam / Water Power
• Technology Improvement interchangeable parts,
  etc.
• Farming Technology in the South
• Cotton Gin (invented by Eli Whitney in 1793)

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Westward ExpansionCanada

• During this period, Canada also began a movement
  of westward expansion.
• Immigration greatly increased from the UK and the
  new settlers began to spread across the country.
• However, during this time, there was also an
  immigration movement out of Canada to the US,
  especially amongst French Canadians.

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Civil WarCauses Leading to the Civil War

• Primary Causes from an economic standpoint
• Economic/Production Basis Opposite Ends of the
  Spectrum
• Manufacturing vs. Agriculture
• Paid vs. Unpaid Labor
• Economic (and Political) Balance of the North vs.
  the South
• Trade vs. Trade Barriers

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Civil WarCauses Leading to the Civil War

• Economic/Production Basis Opposite Ends of the
  Spectrum
• Manufacturing vs. Agriculture
• North Major manufacturing of consumer, military
  and other goods
• South Cash Crop Orientation
• Paid vs. Unpaid Labor
• North - Paid Labor
• South Slavery widespread
• 25 of the citizens owned slaves
• 4 million total Negros
• Not enough whites to work

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Civil WarCauses Leading to the Civil War

• Economic (and Political) Balance of the North vs.
  the South
• Trade vs. Trade Barriers
• North
• Created tariffs to protect and encourage domestic
  manufacturing
• Not import/export oriented
• Enough power to create tariffs (19 free states /
  15 slave states originally, the N/S had been
  balanced, but with the additional states entering
  the union, imbalance occurred.)
• South
• Received reciprocal tariffs from other countries
  in the export of their goods
• Completely import/export oriented
• Difficult to create more slave states to balance
  Northern political power

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Civil War N vs. S Industrialization

• Rail Lines

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Civil War N vs. S Industrialization
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Civil WarWar Starts

• The Civil War started in 1861 and ended in 1865.
• In this time, there were 865,000 casualties (dead
  and wounded) total from both sides. This was the
  bloodiest conflict that the United States has
  ever faced.
• The war began with the secession of the Southern
  states from the Union. President Lincoln fought
  to restore the union (not end slavery).

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Civil War Troubles South of the Border

• During the course of the US Civil War, Mexico
  also experienced war.
• In 1862, France invaded under the pretense of
  collecting unpaid debt. Mexican patriots
  successfully fought off the French armies under
  Ferdinand Maximilian Joseph of Austria and
  finally regained independence in 1867.

• Mexico then went through several leaders to be
  governed by President Diaz who held power through
  approx. 1920 before another revolution threw him
  out of power. Under Diaz, Mexicos infrastructure
  improved greatly but social inequities caused
  major problems within the country.

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Development of the NationInventions / Advances

• The US (and Canadian/Mexican) began to quickly
  industrialize in what is known as the 2nd
  Industrial Revolution.
• Several breakthroughs greatly assisted.
• Bessemer process for making steel. (1850s)
• Cheap steel for railroads, machinery, etc.
• Refinement of oil (1850s)
• Replaced whale oil with kerosene, created
  gasoline, etc.
• Harnessing of electricity (1879)
• Telegraph and Telephone (1850s and 1876
  respectively)
• Automobiles
• US built its first gas powered car in 1893
• Airplanes (1903)

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The rise of corporations and powerful business
leaders led to the dominance of big business in
the United States.
Development of the NationBig Business

• Many entrepreneurs formed their businesses in the
  late 1800s as corporations.
• Corporations encouraged more investment in
  businesses because stockholders could sell stock
  whenever they wanted.
• This led to a Huge and rapid growth of business
  in America.
• Canada soon followed America to a lesser extent.
• Big Business in Mexico was constantly hampered by
  inefficiency, non-rule of law, govt.
  nationalization of companies, etc.

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Development of the NationLabor Movement Ideas

• People and the government began to view big
  business as a problem in the late 1800s.
• Concerned about child labor, low wages, and poor
  working conditions

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Development of the NationAnti Trust Movement

• Critics said many businesses earned their
  fortunes through unfair business practices.
• Used size and strength to drive smaller
  competitors out of business
• Powerful trusts sold goods and services below
  market value until smaller competitors went out
  of business, then raised prices.
• Some people were concerned when a trust gained a
  monopoly, or total ownership of a product or
  service.
• The Sherman Antitrust Act passed in 1890 made it
  illegal to create monopolies or trusts that
  restrained trade.
• The act did not clearly define a trust in legal
  terms, so it was hard to enforce.
• Corporations and trusts continued to grow in size
  and power.

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Development of the NationTransportation Systems

• All three countries had a very similar
  progression for their transportation systems.
  However, all 3 progressed at different rates.
• System Progression
• Stage Coach
• Rail Roads
• Roads

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Pacific Railroad Act, 1862

• Authorized a route from Omaha, Nebraska, to San
  Francisco, California.
• Building the railroad could not have been
  possible w/out the substantial land grants from
  the US govt to the railroad companies
• Land grants financed construction. Allowed
  homesteaders to claim 160 acres (about 200,000
  pyeong) of land free if they lived and worked on
  it for 5 years.
• Companies received 120km right of way gt 60 km on
  either side of the rail line
• Value of this land increased w/the coming of the
  railway b/se it was close to the line
• 1920 peak of railroad construction w/420,000 km
  of track

37
Automobiles

• 1900 8,000 automobiles in the US
• 1920 8 million cars, 1 million trucks

• 1904 rural roads were dirt tracks
• 1924 750,000 km of rural highways w/paved
  surfaces

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Venturing AbroadTrade and Muscle Asian Policy

• China
• European powers gained spheres of influence in
  China and the United States feared it would be
  shut out of the valuable China trade.
• Increased foreign presence in China led to the
  Boxer Rebellion in 1900 and the US contributed
  troops to help.
• Japan
• Commodore Matthew Perry brought four steamships
  into Tokyo Bay in 1853 to pressure Japan to
• open its ports to trade. Tactic was
• known as Gunboat Diplomacy.
• Korea
• Similar to Japanese opening tactic.

39
Venturing AbroadSpanish American War

• The US and Spanish fought on 2 fronts
• Caribbean
• Philippines
• Decisively defeating Spain in both areas, the US
  took over the areas (as well as Guam) and
  governed them for varying periods of time before
  letting the people declare independence and
  forming their own pro-US countries.

40
Annexing the Philippines
Controversy raged in the United States over
whether to annex the Philippines.

• For Annexation
• Believed the United States had a duty to spread
  its values overseas.
• Philippines had economic and strategic value that
  should not fall into the hands of other
  countries.

• Against Annexation
• Believed annexation would violate the ideal of
  self-government
• Did not want oppression to occur The United
  States should not export racism and violence
• Some Americans believed annexation would increase
  immigration to the United States.

The US did annex the Philippines. Several years
later, they were fighting Filipino rebels. Full
independence was giving in 1944.
41
Venturing AbroadCentral America

• The US had long claimed that the Western
  Hemisphere was off-limits to Foreign Powers.
• Monroe Doctrine was an early declaration in 1823.
• However, until the late 1800s, the US was too
  weak to force European countries to stay out.
  Post civil war, the US gained the strength and
  will to use their new power.
• Reasons for creation
• Keep Europe out of the Western hemisphere
• Reserve area for US commercial and political
  interests
• Roosevelts motto "Speak softly and carry a big
  stick, and you will go far.

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Venturing AbroadCentral America

• The US began an interventionist policy to
  protect US political and commercial interests
  in central America.
• The US invaded many countries in the area, from
  Mexico, Haiti, Nicaragua, Honduras, etc.
• Sometimes on the request of the home govt., ie.
  Panama
• Sometimes on the request of US business
  interests, ie. Guatemala (United Fruit now
  Chiquita)

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Venturing AbroadPanama Canal

• Another extension of American military and
  economic might was the building of the Panama
  Canal.
• In 1902, the US purchased the right to build the
  canal from the French and went on to support the
  new Panamanian government against rebel troops.
  For their help, they were given a lease for the
  Panama canal.
• Took from 1904 to 1914.
• Allows trade and military vessels much quicker
  travel between the Atlantic and Pacific oceans.

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Venturing AbroadWWI

• World War I was an important time period in US
  and Canadian history that must be mentioned.
  Although the main points, as they relate to
  N.America, are not primarily business related,
  they still have a large degree of economic
  meaning.
• When the great powers of Europe went to war in
  1914, the US wanted to remain neutral although
  they did have greater support for England and
  France due to historical and business ties.
• Canada, however, began shipping volunteer troops
  early.

45
Venturing AbroadWWI

• Despite remaining neutral for some time, the US
  finally entered the war for 2 reasons
• U-Boats sinking of US passenger and merchant
  ships
• Zimmerman note where Germany proposed an allience
  with Mexico and requested them to attack the USA.
  Mexico declined.
• In 1917, the US began raising an army.
• Both the US and Canadian troops fought with
  distinction until the war ended in 1918.

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Mobilizing the Economy
47
Mobilizing Workers

• During the war, the profits of many major
  industrial companies skyrocketed because
  companies sold to the federal government.
• This created enormous profits for stockholders of
  industries like steel, oil, and chemicals.
• Factory wages also increased, but the rising cost
  of food and housing meant that workers were not
  much better off.
• War demands also led to laborers working long
  hours in increasingly dangerous conditions in
  order to produce the needed materials on time and
  faster than other companies.
• These harsher conditions led many workers to join
  labor unions.

Union membership increased by about 60 percent
between 1916 and 1919, and unions boomed as well,
with more than 6,000 strikes held during the war.
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Looking InwardBefore the Collapse

• The Roaring 20s were a period of great social and
  economic change in the US.
• Women sought more rights.
• Urbanization
• First time that there were more Americans in
  cities than on farms.
• Many negros migrated to northern cities.
• Prohibition
• Business prospered
• Rise of radio and movies

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The Appearance of Prosperity

• Strong Stock Market
• The stock market, where people buy stocks, or
  shares, in companies, performed very well in the
  1920s, with stock values sharply increasing each
  month.
• The value of stocks traded quadrupled over nine
  years.
• The steep rise in stock prices made people think
  the market would never drop, and more ordinary
  Americans bought stocks than ever before.
• The number of shares traded rose from 318 million
  in 1920 to over 1 billion in 1929.
• Business leaders said everyone could get rich
  from stocks.

• Strong Economy
• Between 1922 and 1928 the U.S. gross national
  product, or total value of all goods and
  services, rose 40 percent.
• Though farmers and some other workers didnt
  benefit, the overall economy performed well,
  especially for automakers and those who made auto
  parts.
• Overall unemployment remained low, averaging
  around five percent between 1923 and 1929.
• Union membership slowed as employers expanded
  welfare capitalism programs, or employee
  benefits.
• This feeling of prosperity encouraged workers to
  buy new products and enjoy leisure activities
  such as movies.

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Looking InwardUnseen Trouble
51
Looking InwardThe Crash

• October, 1929 Rumors began to circulate.
• Thursday, October 24, 1929 Panicked selling
  causes huge sell-off to occur
• Friday, October 25, 1929 Leading bankers join to
  buy shares and stop a collapse.
• But on Monday the market sank again, and Black
  Tuesday, October 29, was the worst day, affecting
  stocks of even solid companies.
• In those short days, overall company market value
  fell by 50.

52
Losses

• The loss from the crash was unbelievable
• 12 million people went out of work,
• 12,000 people was made unemployed everyday,
• 20,000 companies and 1616 banks had gone
  bankrupt, and
• 23,000 people committed suicide in one year the
  highest ever.
• The total loss by the end of the next week
  amounted to 30 million dollars, ten times more
  than the annual budget of the federal government,
  far more than the U.S. had spent in all of World
  War 1.
• Contributing to The Great Depression.

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Looking InwardCrash Effects

• Individuals
• Most the stock they held is now worthless.
• Banks
• Many people were worried about their money so
  they withdrew it from banks en mass. Causing
  banks to fail.
• Some banks also failed due to their stock market
  investments.
• Businesses
• Banks would not lend money so no new investment.
• People were not spending so people were laid off.
  Now people have even Less money to spend.

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Looking InwardCrash Effects

• International Trade
• The fragile economies of Europe were still
  struggling from World War I. They had borrowed a
  great deal of money from American banks that the
  banks now wanted back.
• With U.S. buying power down, foreign businesses
  were less able to export their products and were
  forced to fire workers so they were less inclined
  to buy US exports.
• Governments tried to protect themselves by
  passing high tariffs, making foreign goods
  expensive. Due to this, the export market began
  drying up thus making the situation even worse.

56
The Smoot-Hawley Tariff Act
The Act
The Effects
57
Looking Inward Great Depression

• Beginning with the stock market crashes, the US
  economy sank.
• Many were effected
• Farmers Demand went down and so did crop prices.
  Hundreds of thousands of bankruptcies and
  foreclosures.
• Workers Unemployment averaged 25

58
The Impact of the New Deal

• Franklin Delano Roosevelt was elected President
  and implemented 2 plans that are called the New
  Deal

• Relief
• Millions of Americans enjoyed some form of help.
• Direct relief or jobs that provided a steady
  paycheck
• Programs such as Social Security and unemployment
  insurance became a fixture of government.

• Recovery
• Not as successful at economic recovery
• Unemployment remained high.
• Some critics argued that Roosevelt needed the
  support of big business.
• Other critics said that the New Deal didnt spend
  enough money.

• Reform
• More successful and long-lasting
• FDIC restored public confidence in the nations
  banks.
• SEC restored public confidence in stock markets.
• New Deal left thousands of roadways, bridges,
  dams, public buildings, and works of art.

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60
The Impact of the New Deal

• The New Deal promised relief, recovery, and
  reform.
• Relief programs put billions of dollars into the
  pockets of poor Americans.
• The New Deal was less successful in delivering
  economic recovery.
• New Deal reforms were successful and
  long-lasting.
• The New Deal changed the link between the
  American people and their government.
• Roosevelt believed that government could help
  businesses and individuals achieve a greater
  level of economic security.
• The New Deal required a much bigger government.
• Americans now began to look regularly to
  government for help.

61
Superpower and BeyondInteresting Times...

• A song by Billy Joel recounts much of what we
  will discuss in this section.

http//www.youtube.com/watch?vjR-A4QFHZBA
62
Superpower and BeyondTrying to Stay Out!

• Hostilities were erupting in Europe again and N.
  American nations tried to maintain their
  neutrality.
• People even turned against the League of Nations
  as they felt that it would drag them into another
  war.
• Even a new trade policy was even implemented...
• Congress changed the neutrality laws to a new
  policy called cash-and-carry.
• Countries at war could buy American goods if they
  paid cash and picked up their goods at American
  ports.

63
Superpower and BeyondTroubles with Japan

• America was finally pulled into the war in 1941
  as the result of an attack on Hawaii by the
  Japanese navy.
• Afterward, the US declared war on Japan, Germany
  and Italy.

64
American Industry and Science in World War II

• Troops needed proper equipment to fight World War
  II.
• Factories that produced consumer goods were
  converted to the production of military supplies.
• Roosevelt called for the production of new planes
  and tanks.
• War supplies had to be shipped overseas.
• Submarines took a terrible toll on American
  shipping.
• American shipyards turned out thousands of new
  vessels to replace those lost during the war
  using assembly-line techniques.
• Wartime agencies regulated what factories
  produced, what prices they could charge, and how
  the nations raw materials could be used.

65
Mobilizing Industry and Science

• Factories needed workers at the same time men
  were leaving to join the armed forces.
• Women solved the problem. Millions began to work
  outside the home in industrial jobs.
• Working women of the war were represented by the
  symbolic figure known as Rosie the Riveter.

Rosie the Riveter

• Many workers joined labor unions and the
  government was concerned about strikes.
• The National War Labor Board was established in
  1941 to help settle labor disputes.
• The Smith-Connally Act passed in 1943.

Labor in WW II

• The Manhattan Project began a top-secret mission
  to build an atomic bomb.
• Physicist J. Robert Oppenheimer and other
  American scientists raced to develop this weapon
  ahead of the Germans.

Mobilizing Science
66
Challenges after the War

• United Nations
• Representatives from 50 countries met to form a
  new organization, the United Nations.
• The UN was meant to encourage cooperation among
  nations and to prevent wars.

• Potsdam Conference
• Allied leaders met in the German city of Potsdam
  to discuss the spread of communism and Soviet
  influence in the postwar world.
• Truman hoped to get Stalin to live up to his
  promises from Yalta.
• Stalin did not do this.

• Rebuilding
• MacArthur led efforts to help Japan rebuild its
  government and economy.
• Seven Japanese leaders were tried for war crimes.
• Rebuilding Europe caused tensions between the U.S
  and the Soviet Union.

67
Marshall Plan

• 1947 Massive aid package to help war-torn Europe
  recover from the war
• Purpose prevent communism from spreading into
  economically devastated regions
• Result Western and Central Europe recovered
  economically -- the "economic miracle"
• Soviets refused to allow U.S. aid to countries in
  eastern Europe

68
Cold War?

• The tension and rivalry between the USA and the
  USSR was described as the Cold War (1945-1990).
• There was never a real war between the two sides
  between 1945 and 1990, but they were often very
  close to war (Hotspots). Both sides got involved
  in other conflicts in the world to either stop
  the spread of communism (USA) or help the spread
  (USSR).

69
Superpower and BeyondCold War Hotspots
Clockwise Korea Cuba Afghanistan Berlin
Wall Vietnam
70
Economic Miracles

• Causes
• Marshall Plan aid helped western Europe begin
  recovery in 1947
• Korean War in 1950 stimulated economic activity.
• Economic growth became a basic objective of all
  western European governments.
• Governments accepted Keynesian economics to
  stimulate their economies.
• Germany and France were especially successful and
  influential.
• In most countries many people willing to work
  hard for low wages expanding industries
  benefited.
• Increased demand for consumer goods.
• Many economic barriers eliminated and a large
  unified market emerged Common Market.

71
1970sMajor Trends

• Energy
• OPEC formation
• Oil Shocks (1973, 1979)
• Intl. Economic Cooperation
• Bretton Woods system (rules intl. commercial and
  financials relations, currency pricing, etc.)
• Stagflation
• Growth of Technology

72
1980sMajor Trends

• USA
• Trade
• Worldwide Liberalization
• Multinationals Grow
• Growth of Japanese Imports
• Canada
• Quebec Referendum
• Independence! (1982)
• Mexico
• Zapatistas
• Glasnost!

73
1990sMajor Trends

• USA
• Trade Grew
• NAFTA
• GATT and WTO Formation
• Energy
• Cheap Oil
• General Economy
• DOW skyrocketing
• Canada
• Growth of Quebec Separatism
• Mexico
• Zapatistas

74
2000sMajor Trends

• USA
• ?
• Canada
• ?
• Mexico
• ?