Key Concept 7.1

Governmental, political, and social organizations struggled to address the effects of large-scale industrialization, economic uncertainty, and related social changes such as urbanization and mass migration.

I. The continued growth and consolidation of large corporations transformed American society and the nation's economy, promoting urbanization and economic growth, even as business cycle fluctuations became increasingly severe.

    • Large corporations came to dominate the U.S. economy as it increasingly focused on the production of consumer goods, driven by new technologies and manufacturing techniques.
    • The United States continued its transition from a rural, agricultural society to an urban, industrial one, offering new economic opportunities for women, internal migrants, and international migrants who continued to flock to the United States.
    • Even as economic growth continued, episodes of credit and market instability, most critically the Great Depression, led to calls for the creation of a stronger financial regulatory system.

II. Progressive reformers responded to economic instability, social inequality, and political corruption by calling for government intervention in the economy, expanded democracy, greater social justice, and conservation of natural resources.

    • In the late 1890s and the early years of the 20th century, journalists and Progressive reformers - largely urban and middle class, and often female - worked to reform existing social and political institutions at the local, state, and federal levels by creating new organizations aimed at addressing social problems associated with an industrial society.
    • Progressives promoted federal legislation to regulare abuses of the economy and the environment, and many sought to expand democracy.
      • Clayton Anti-trust Act, Florence Kelley, Federal Reserve Bank

III. National, state, and local reformers responded to economic upheavals, laissez-faire capitalism, and the Great Depression by transforming the U.S. into a limited welfare state.

    • The liberalism of President Franklin Roosevelt's New Deal drew on earlier progressive ideas and represented a multifaceted approach to both the causes and effects of the Great Depression, using government power to provide relief to the poor, stimulate recovery, and reform the American economy.
      • National Recovery Administration, Tennessee Valley Authority, Federal Writers' Project
    • Radical, union, and populist movements pushed Roosevelt toward more extensive reforms, even as conservatives in Congress and the Supreme Court sought to limit the New Deal's scope.
      • Huey Long, Supreme Court fight
    • Although the New Deal did not completely overcome the Depression, it left a legacy of reforms and agencies that endeavored to make society and individuals more secure, and it helped foster a long-term political realignment in which many ethnic groups, African Americans, and working-class communities identified with the Democratic Party.
      • Social Security Act, Federal Deposit Insurance Corporation (FDIC)