All pundits predicting a second Roaring Twenties in America after the COVID-19 pandemic need to be careful what they wish for.
History shows that 1920s America was a terrible place to live. The real Roaring Twenties was a time of rampant racism, violence, out-of-control crime, massive income inequality, and a destructive roller coaster economy.
Instead of feeling nostalgic for the Roaring Twenties, Americans need to work to avoid a return to that terrible time.
Some Reasons the 1920s were terrible include:
1. Lynching and Race Riots
The murder of unarmed people, mostly African Americans, by mobs was widespread in the 1920s. For instance, UMKC estimates here were 61 lynchings in 1920, 54 lynchings in 1921, and 57 lynchings in 1922. The best year for lynchings in the 1920s was 1929, when they lynched 20 people.
The worst 1920s lynching was the Tulsa Race Massacre on 31 May and 1 June 1921. During the massacre, mobs burned 1,256 homes and 35 square blocks of Tulsa’s prosperous middle-class black neighborhood of Greenwood.
Nobody knows how many people died in the Tulsa Race Massacre, but the Oklahoma Bureau of Vital Statistics estimates mobs killed 36 people. However, some historians claim the death toll was as high as 300, making the Race Massacre the worst riot in American history.
The media and Oklahoma leaders suppressed the story of the Tulsa Race Massacre for decades. In fact, some newspaper stories about the Tulsa Race Massacre disappeared from the archives.
2. Jim Crow
The 1920s was the height of Jim Crow, a racist apartheid system designed to strip people of color, primarily African Americans, of all rights, status, and human dignity. Some examples of Jim Crow Laws collected by Ferris State University’s Jim Crow Museum include:
Jim Crow regulated every aspect of ordinary Americans’ lives. For instance, a white man and a black woman could face up to 12 months in jail or a $500 ($7,394 in 2021 dollars) fine for spending the night together in Florida, Ferris State University reports.
In Mississippi, authorities could fine a person $500 ($7,394 in 2021 dollars) or jail somebody for six months for presenting “arguments or suggestions in favor of social equality or of intermarriage between whites and negroes” in print. Thus there were no First Amendment Rights in 1920s Mississippi.
Another Mississippi state law required that all hospitals have separate entrances for white and black patients. In North Carolina, white and black students could not use the same textbooks. In addition, white and colored people could not use the same public libraries in North Carolina and Texas.
In Oklahoma, teachers could face a fine of $10 to $50 ($147 to $739.46 in 2021 money) for teaching black and white pupils in the same classroom. Finally, mines in Oklahoma had to have separate showers and lockers for white and black miners. Hence, the state encouraged companies not to hire blacks for high-paying mining jobs.
3. The Agricultural Depression
For America’s farmers, the Great Depression began in 1920, not 1929. The Farm Crisis or Agricultural Depression devastated rural areas and impoverished millions.
During World War I, America’s farmers enjoyed high crop prices and prosperity while Europe’s farmers were off killing each other in the trenches. When the war ended; and European farmers returned to the fields, prices and American farmers’ incomes collapsed.
For example, corn prices fell by 63% between 1919 and 1920, MNOPEDIA estimates. Similarly, wheat prices fell from $2.34 a bushel in 1919 to $1.65 in 1920. Consequently, Minnesota farmers’ gross cash income fell from $438 million in 1918 to $229 million in 1922, MNOPEDIA estimates.
Many farmers found themselves deep in debt because they had taken out huge mortgages during World War I. Predictably, many of those farmers could not pay those mortgages.
Tens of thousands of farmers around the country faced bankruptcy and foreclosure. In Minnesota, banks foreclosed on 1,442 farms between 1926 and 1932. Similarly, 2,866 Minnesota farmers declared bankruptcy between 1922 and 1932.
The 1920s was a terrible time to be a farmer in America. Predictably, millions of people fled the farms for the cities hoping to find work. For example, The Balance estimates that over two million American farmers fled to the cities during the 1920s.
4. Income Inequality
The Roaring Twenties was a time of massive income inequality in America. In 1929, America’s “top 0.1% richest adults’ share of total household wealth was close to 25%,” Gabriel Zucman estimates.
In 2019, Zucman attracted media attention for a paper in which he wrote: “U.S. wealth concentration seems to have returned to levels last seen during the Roaring Twenties.” Zucman is an economics professor at the University of California at Berkeley, MarketWatch reports.
Similarly, the Economic Policy Institute estimates America’s wealthiest 1% received 23.9% of the nation’s income in 1928.
5. The Florida Real Estate Bubble
The 1920s saw one of the worst real estate bubbles in American history, the Florida Land Boom.
The combination of glorious weather, sunshine, beaches, cheap land, cheaper credit, and direct rail connections to the Northeast and Midwest fueled a massive real estate bubble in Florida. Thousands of people tried to get rich by turning swampland into second homes for Northerners.
During the 1920s, selling and developing real estate were the only industries in South Florida. In fact, The Miami Herald was the heaviest newspaper in the country because of all the real estate ads, Florida History reports.
Out-of-state speculators who hoped to make money by flipping the land purchased two-thirds of all Florida real estate in the 1920s. As in 2007 and 2008, most of the speculators lost everything.
Demand for homes was so great in South Florida during the boom, that developers built several cities for new arrivals. Florida’s boom cities include Coral Gables, Hollywood, Miami Shores, and Hialeah.
Land sold so fast that Realtors employed Binder Boys, young men who took down payments on vacant land often from tourists. There was no credit check and sometimes no deed for the land. Hence, Ninja (no-income-no job) loans were around during the 1920s. Many properties sold by the Binder Boys comprised swampland next to a tennis court or golf course.
Everybody was promoting swampland in 1920s Florida. Florida’s state legislature promoted the land boom with a law banning income and inheritance taxes. Similarly, the Florida Chamber of Commerce promoted land sales with fake newspaper articles and publicity stunts.
Construction boomed. In 1924, Florida imported enough wood to encircle the Earth’s equator with an eight-foot wide boardwalk. However, nobody knew how they would pay for that wood.
In 1925, the Florida Boom burst and bankrupted everybody, including governments. The city of St. Petersburg, Florida, was the most indebted municipality in the country, Key West was second.
The burst began in October 1925, when the Seaboard Air Line Railway, the Florida East Railway, and the Atlantic Coast Railroad began refusing to haul building materials to Florida. Railroad executives claimed they were hauling so much building material there was no room for essential items such as food and fuel. A stronger possibility is that many building materials shippers were not paying their freight bills.
As the railroads halted shipment, many flippers found they had no buyers for properties. Meanwhile, the national media began attacking and mocking all Florida real estate as a scam.
A massive Hurricane in 1926 soured many buyers on Florida. A second Hurricane in 1928 that destroyed over 13,000 homes and killed several hundred people finished the Boom. Developments were in ruins and many never recovered.
The Binder Boys’ Tropical paradise became a post-apocalyptic nightmare. Florida’s economy did not recover from the Land Boom until after World War II.
6. The Ku Klux Klan
The 1920s was the high point of the Ku Klux Klan. On 8 August 1925, over 50,000 Klansmen and women marched through Washington DC in their sheets.
By 1925, the Klan claimed to have two to five million members in America. The Klan held massive rallies all over the United States, even in New York City and Los Angeles.
The Klan took control of state governments in Indiana, Colorado, Oregon, Washington State, Ohio, and even Pennsylvania, The Atlantic claims. The 1920s Klan differed from the post-Civil War organization and today’s Klan. The Twenties Klan’s principal target was Catholics, but it also went after Jews, blacks, immigrants, Hollywood, Asians, Mexicans, Communists, and Italians.
Strangely, the cross-burning secret society claimed to be an army of Christian moral crusaders. However, the 1920s’ Klan’s principal message was one of white protestant nationalism. The message was that America was for white Protestants and nobody else.
Historians and journalists blame the Klan for hundreds of violent acts in the 1920s. The violence included lynchings, beatings, floggings, shootings, and whippings. Some of the strangest Klan activity, including the flogging of joyriding teenagers and the tar and feathering of suspected abortionists.
Ironically, the 1920s Klan’s popularity came from a new entertainment medium dominated by Jewish immigrants: movies. The enormous popularity of the racist film The Birth of a Nation, the first Hollywood blockbuster and one of the first full-length American films, resurrected the Klan.
The Birth of a Nation glorified the Klan as heroes who protected white women from crazed blacks. In a similarity to modern cosplayers, some men began dressing up as Klansmen from the movie and launched a bizarre social movement.
The Twenties Klan crashed as quickly as it rose. Most politicians; including Presidents Warren G. Harding (R-Ohio) and Calvin Coolidge (R-Massachusetts), opposed the Klan. As intellectuals led by H. L. Mencken mocked the organization.
The Klan’s fall began in 1925 when a jury convicted David Stephenson; the Indiana Klan leader of raping and murdering a woman. The Klan’s reputation fell apart, and the organization shrank.
By 1928, the Klan’s defeat was complete as the Democratic Party nominated an Irish Catholic Governor Al Smith (D-New York) for President. In 1924, the Klan had so dominated the Democratic national convention that reporters dubbed the gathering “the Klanvention.” By 1928, nobody was paying attention to the Klan.
The most famous feature of 1920s America was the horrendous social experiment they called Prohibition. After the 18th Amendment banned alcohol sales, the federal government went to incredible lengths to keep booze out of Americans’ mouths.
For instance, up to 10,000 people died after drinking alcohol poisoned at federal orders, Slate writer Deborah Blum estimates. To elaborate, federal officials ordered distillers to add toxic chemicals to industrial alcohol.
During Prohibition many people diluted industrial alcohol to create drinkable booze. Federal officials tried to discourage the practice by adding poison.
Criminals; however, kept selling industrial alcohol as liquor. Consequently, tens of thousands of Americans drank booze poisoned by their own government. Besides causing over 10,000 deaths, the toxic liquor blinded and disabled thousands of people.
Those poisoned by bad booze were just the beginning of Prohibition’s body count. Both the murder and suicide rates grew during Prohibition.
Statista estimates that the homicide rate rose from 7.2 per 10,000 in 1919 to 9.2 per 10,000 in 1931. Gang wars for control of the illegal booze trade drove the homicide rate up. Similarly, the suicide rate rose from 11.5 per 10,000 in 1919 to 13.9 per 10,000 in 1929.
Therefore, America’s government killed thousands of its own citizens through Prohibition in the 1920s.
8. Organized Crime
Prohibition did not create organized crime or gangsters in America as many people believe. Instead, Prohibition transformed organized crime from an urban nuisance into big business and a national menace.
Before Prohibition, loosely organized gangs of hoodlums associated with local political machines characterized American crime. By 1930, massive criminal cartels dominated the underworld with well-organized armies of professional thugs.
The illegal liquor trade gave the gangs the money they needed to grow into criminal cartels. The 1920s was the first time organized crime had the money to operate without the support of political machines.
The 1920s was also the first time wealthy gangsters, such as Al Capone, caught the popular imagination. The primary reason for the gangsters’ popularity was the rise of tabloid newspapers which needed sensational news to cover.
Colorful mobsters such as Capone and Lucky Luciano sold newspapers. A few years later, in the 1930s, the Warner Brothers discovered that gangsters also sold movie tickets which brought the Mob into popular culture.
One reason for the rise of organized crime in the 1920s was the collapse of traditional political machines in many American cities. The collapse of political machines, such as Manhattan’s Tammany Hall, left a power vacuum that mobsters such as Capone and Meyer Lansky filled. Thus, the reforms of the Progressive era helped create organized crime.
Predictably, ending Prohibition did not shut down organized crime. The mobsters moved onto new rackets; such as drugs and gambling, when booze became legal. A piece of history that today’s drug legalization advocates need to understand.
9. Stock Market Insanity
The best-known feature of the 1920s’ economy is the insane stock market that wiped out the wealth of the American middle class.
To explain, the Dow Jones Industrial Average rose from 71.95 points in 1921 to 381 points at the time of the Stock Market Crash in October 1929, The Balance estimates. Stock price growth fueled a frenzy of speculation.
Speculation drove stock prices up, creating a doom loop of rising prices driven by hype. As prices rose more people entered the market which caused stocks to rise and rise.
Buying stocks on the margin turned the 1929 Stock Market Crash into a catastrophe for ordinary Americans. The margin is the practice of buying stocks on credit.
By 1929, many brokers allowed ordinary people to buy stocks with 10% to 20% down. The hope was that the growth in stock values could give speculators the money to pay for the stocks. Predictably, when stock prices crashed, many margin buyers could not pay for their trades.
People around the globe felt the economic devastation from the stock market crash. Many banks collapsed because bankers were speculating in the stock market with depositors’ funds.
Since there was little federal bank regulation; and no Federal Deposit Insurance Corporation (FDIC) insurance, in the 1920s, many bank deposits were unsecured. In fact, some banks counted uncashed checks, lines of credit, and margin loans as “reserves.”
Additionally, only one-third of the nation’s banks participated in the Federal Reserve System, in the 1920s, The Balance estimates. Therefore, nobody was regulating two-thirds of America’s banks or securing their deposits.
In the 1920s, people could go to the bank and find no money in their accounts and have no recourse. This led to bank runs in which mobs of depositors tried to pull their money out of banks before they collapsed.
Thus the 1920s Economy was a nightmare for ordinary people. You could not trust banks and the stock market could take all your money.
History shows the Roaring Twenties were a terrible time for Americans. Hopefully, Americans will not try to repeat the nightmare known as the Roaring Twenties.