The period from 1945 to 1968 was one in which American business made great strides materially and laid the foundation for the highest standard of living in the world, but such prosperity carried substantial costs, both to the nation’s psyche and to its environment.
During World War II, economic policy had placed business activity firmly under government control. Ending these controls and dealing with their effects were top priorities for the business community when the war ended. The government had favored large firms for war contracts to such an extent that the 100 largest manufacturing firms accounted for over 70 percent of the nation’s industrial production during the war compared with only 30 percent before the war. Although the share of smaller business increased slightly in the years after the war, the war effort established that the nation’s largest firms would conduct the lion’s share of economic activity. In 1969, the Federal Trade Commission concluded that the trend in American business organization since World War II had been “centralizing and consolidating corporate control and decision-making among a relatively few vast companies.” The negative effects of this consolidation on small business and the public interest were apparent as the nation’s largest home appliance manufacturers and steel producers were convicted of price fixing and other anticompetitive practices in the 1960s.
The wartime experience of individual industries and firms varied greatly. Entire industries, such as watchmaking, abandoned production for the domestic market to meet military needs. American watchmakers soon discovered that the public grew accustomed to imported Swiss watches during the war. Until the cold war re-created demand for explosive timers, the American watch industry floundered. There were businesses, however, that turned wartime production into postwar opportunities. With contracts to supply soldiers with its product, Coca-Cola penetrated overseas markets wherever American forces went.
When the war was over, the process of reconversion to a civilian economy began almost immediately. The government sold production facilities and a variety of surplus equipment and materials to private business for nominal fees. War contracts were abruptly cancelled and government controls on resource allocation were hastily abandoned. For a few months immediately following the war, unemployment was high, strikes were common, and there were shortages of almost everything.
After these initial hardships American business stabilized and inaugurated a period of sustained prosperity, interrupted by only four brief, mild recessions from 1945 through the 1960s. The sheer scale of America’s economic growth was impressive. Even when adjusted for inflation, the nation’s gross national product (GNP) grew dramatically, nearly doubling between 1946 and 1968. More important, the GNP rose in all but three years in this period, making this prosperity remarkably steady.
Initially, the growth was spurred by pent-up demand for housing and consumer goods. Out of economic necessity during the Great Depression and because of their unavailability during the war, products Americans desired were often hard to find. Americans were eager to end that deprivation, and $140 billion in personal savings during the war gave them the financial means to do so. This consumption stimulated production and employment. Before this demand was satisfied, defense policy dictated high levels of military spending. This spending provided a solid base of demand for business that was independent of the fluctuations of consumer spending.
In this larger postwar American ECONOMY, business differed in several respects from its previous operation. Government spending played a noticeably greater role. President Franklin D. Roosevelt’s peacetime budgets averaged 9.2 percent of the GNP. Government spending between 1945 and 1968 was double that on average. Meanwhile the SERVICE SECTOR grew while manufacturing remained steady at a little over 28 percent of GNP; professional and financial services increased their share of America’s GNP to more than 24 percent by the late 1960s, up from less than 19 percent in the years immediately after World War II.
The American workforce experienced even greater changes. After World War II, clerical workers and blue-collar laborers each comprised slightly more than 20 percent of the workforce. By the late 1960s, clerical and kindred workers made up over one-third of the labor force, while the percentage of blue-collar workers fell. The percentage of workers in service industries rose from a little over 11 percent to almost 17 percent by the late 1960s. Manufacturing still accounted for roughly the same amount of economic activity as it did in the late 1940s and was still the single biggest component of the economy. Nevertheless, clerical positions had greatly expanded and the service industries produced a larger share of the nation’s GNP and employed more of the nation’s workforce in the 1960s than they had in the 1940s. Mining and agriculture saw the greatest decline in the percentage of the nation’s economic activity.
Business activity spread out from the urban areas of the Northeast and West Coast during this period as well. The Sunbelt areas of the South and West recruited defense contractors to serve the military bases located in the regions. Soon, they began to draw manufacturing enterprises. Service and transportation industries quickly followed. The nation’s business activities were spreading into areas previously dominated by agriculture and extractive industries, such as timber and mining, giving the Sunbelt a more diverse economic structure.
Following World War II, the United States dominated the global economy. This created many new opportunities for American businesses in both exporting and importing. Multinational corporations became a major factor in the world’s economy. Increasingly, large American firms established overseas subsidiaries. This gave businesses more direct access to raw materials, markets, and labor outside the United States. The amount of America’s economic activity that rested on international trade nearly quadrupled from 1946 to 1968. The U. S. government eagerly facilitated this increase in American overseas economic activity through programs such as the Marshall Plan and Point Four Program and by supporting institutions like the International Monetary Fund (IMF) and World
Bank and inaugurating tariff reductions through the General Agreement on Tariffs and Trade (GATT).
The union movement emerged from the war very strong. Unions and their leadership, once considered a threat, were co-opted by business. Business leaders began dealing with union leaders more as equals than as adversaries. They relied on union leadership to help solicit government contracts and to keep the union rank and file from making extreme demands. Union leaders found themselves with their own vested interests and positions to protect, often making them more natural allies of management than the membership of their own unions. While some union members criticized the close relationship between unions and business leaders, they, too, were being placated into passivity. Work contracts began to include many provisions desirable to workers, including medical coverage, paid vacations, guaranteed annual wages, and an automatic cost-oe-living adjustment (COLa). With leadership more sympathetic to management and a workforce complacent following the material improvement in its condition, unions did little to shake the foundations of business in the 1950s and 1960s.
Beginning in the 1960s, the consumer movement and its most vocal spokesperson, author Ralph Nader, did shake up business. Nader and others, such as author and environmentalist Rachel Carson, alerted the country to how irresponsible business had been while creating the material prosperity that many Americans enjoyed. In response to public pressure generated from publicizing the negative effects of business activity, Congress embarked on a whole new series of regulations of business practices. Some hazardous products were banned or severely restricted, and laws such as the Water Quality Act, Clean Air Act, and the National Traeeic and Motor Vehicle Saeety Act oe 1966 were passed to insure that business was attentive to consumer safety and to minimizing its destruction of the environment. This was the beginning of the most comprehensive round of business regulation since the Progressive era in the early 20th century.
A negative aspect of American business during this period was the effect increasingly larger and more bureaucratized work structures had on employees. Several authors, including sociologists C. Wright Mills and
David Riesman and novelist Sloan Wilson, explained how the new scale and structure of business organization made white-collar and clerical employees “cogs in a machine,” just as assembly-line production had done to blue-collar workers generations earlier. These critics charged that this imposed a dehumanizing conformity on almost every business employee. As author Vance Packard pointed out, people were told to seek solace from this emotional emptiness by consuming more goods, reinforcing the materialist emphasis of American capitalism and stimulating sales and production of more goods. While businesses stripped away the humanity and individuality of their employees, their increasingly pervasive advertising told the workers not to worry, but instead to go shopping.
From a material standpoint, American business was in better shape between 1946 and 1968 than it had ever been. American businesses were growing in size and were spreading throughout the noncommunist world. Their ability to fulfill the desires of American consumers seemed limitless. One could reasonably ask, as critics did, at what price had this prosperity come? To a generation that grew up in the deprivation of the Great Depression and World War II, answers to that question were perhaps not that important. The public expressed its desire to be protected from businesses that were unconcerned about the safety of their products and environmental destruction, but few outside the counterculture expressed skepticism of capitalist materialism. Unions became docile and most Americans continued their consumptive race to “keep up with the Joneses.” As the baby boom generation came of age, however, business would have to work harder to convince these younger Americans to accept the practices and dynamics of the American system of business that had been created after World War II, or, failing that, to adjust the system to the new generation’s ideals and expectations.
Further reading: John Kenneth Galbraith, The Affluent Society (Boston: Houghton-Mifflin, 1958); Thomas McGraw, American Business, 1920-2000: How It Worked (Wheeling, Ill: Harlan-Davidson, 2000); Sloan Wilson, The Man in the Gray Flannel Suit (New York: Simon & Schuster, 1955).
—Dave Price
Carmichael, Stokely (1941-1998) Black Power leader
Stokely Carmichael was head of the Student Nonviolent Coordinating Committee (SNCC) and a prominent member of the Black Panthers during the 1960s.
Carmichael was born in Port of Spain, Trinidad, to Mabel and Adolphus Carmichael, a carpenter, in 1941. Stokely’s parents moved to the United States when he was still very young, leaving the child in the care of relatives. Stokely and his three sisters joined their parents in New York City in 1952, settling in Harlem and later the Bronx.
Carmichael excelled as a student and gained admittance to the Bronx High School of Science, where he was one of only two black students in his class. He rejected a number of scholarships to predominantly white colleges and universities and entered historically black Howard University in 1960 as a premedical student, although he eventually graduated with a degree in philosophy. While at Howard, Carmichael joined the Congress of Racial Equality (CORE) and became involved in a number of anti-SEGREGATion efforts from sit-ins to voter education campaigns in the South. On a 1961 ereedom ride through Mississippi, Carmichael was arrested for violating state segregation laws and endured 53 days in deplorable conditions at the state’s infamous Parchman Penitentiary, an experience that apparently only strengthened his resolve to fight for African-American rights.
Carmichael graduated from Howard in 1964 and joined SNCC, the major student-organized civil rights organization of the 1960s. In Lowndes County, Mississippi, Carmichael played an integral part in the evolution of the Lowndes County Freedom Organization, formed as a separate political party for African Americans. He rapidly became known for his talent for working effectively with college-educated activists, working-class blacks, and white supporters.
By 1966 fissures were appearing in SNCC over what role whites should play in the organization. Although
Carmichael rejected the view of a minority of SNCC workers that whites be excluded, he took advantage of the climate of divisiveness and ran for SNCC chairman. Carmichael hoped to shape SNCC into an organization like the Lowndes County body, providing more power to working-class African Americans with less stress on nonviolence. In the election, Carmichael defeated John Lewis, who had led SNCC since 1963, and he began pointing the group in a more militant direction. During the summer of 1966, Carmichael spearheaded SNCC’s efforts to complete the march across Mississippi begun by activist James Meredith, who had been shot and wounded before completing the trek. During this march Carmichael first began using the phrase that soon became identified with him (although he was not the first to use it)—“Black Power.” Carmichael’s use of the phrase only codified a long-brewing shift toward militancy for SNCC. The slogan of “Black Power” galvanized white support for the Civil Rights movement and boldly called for an increasingly black nationalist agenda for younger civil rights activists.
In subsequent years Carmichael continued to move toward Black Nationalism instead of relying on white leadership and nonviolence. Black Power appealed to many within SNCC because it awakened a sense of pride and confidence in a uniquely black aesthetic dormant in more conservative forms of black protest. Carmichael still did not preclude interracial cooperation, but he stressed the need for self-determination and unity among people of color. The move toward Black Power further damaged the already fragile unity between SNCC and more conservative civil rights organizations.
Carmichael continued to call for Black Power throughout his time at the head of SNCC, but his support soon waned. The more radical SNCC became, the faster northern financial support disappeared. Likewise, many working-class southern African Americans did not relate to calls for Black Nationalism, and the issue of what role whites
Stokely Carmichael addressing an audience, 1966 (Library of Congress)
Should play continued to divide SNCC. By the spring of 1967, it was clear that Carmichael’s time at the head of SNCC was up, and he resigned as chairman.
In June 1967, Carmichael joined the Black Panther Party. That same summer he went on a tour that included Cuba, China, North Vietnam, and Guinea (among other countries). During the trip he further cemented his ties to left-wing radicalism and pan-Africanism. Carmichael’s open willingness to associate with foreign leftists angered many Americans but only enhanced his prestige among Black Power advocates. Carmichael had become too radical for SNCC, though, and he was expelled in August 1968. The expulsion meant little to Carmichael, since he had not attended a staff meeting since his return from abroad and now worked primarily with the Black Panthers.
Facing increased pressure from Federal Bureau of Investigation (FBI) surveillance and feeling dissatisfied with his role with the Black Panther Party, Carmichael began spending time in Guinea and soon took up permanent residence there. In 1978 he changed his name to Kwame Toure. He died in 1998, having never stopped working toward his pan-African vision.
Further reading: Clayborne Carson, In Struggle: SNCC and the Black Awakening of the 1960s (Cambridge, Mass.: Harvard University Press, 1981).
—Kevin P. Bower
Carson, Rachel (1907-1964) writer, marine biologist, conservationist
Biologist and author of the 1962 book Silent Spring, Rachel Carson is credited with inspiring the modern ENVIRONMENTAL MOVEMENT in the United States.
The publication of Silent Spring led to public outcry over the use of chemical insecticides such as DDT. Congressional hearings were held to look into the effects of the chemical and a grass-roots movement began calling for stricter environmental protection. The result was the establishment of the Environmental Protection Agency (EPA) in 1970 and the ban on DDT.
Born in Springdale, Pennsylvania, on May 27, 1907, Carson acquired an appreciation for the natural world from her mother. Carson attended the Pennsylvania College for Women (now Chatham College) where she agonized over whether to study English or biology. She changed her major to biology, but remained devoted to literary activity for the rest of her life. Carson studied zoology in graduate school at Johns Hopkins University, received her M. A. in 1932, and taught at the University of Maryland from 1931 to 1936. Family responsibilities kept Carson from pursuing her doctorate, but she did manage to spend her summers studying at the Marine Biological Laboratory in Woods Hole, Massachusetts. Although Carson loved the sea, her trip to Woods Hole marked the first time she had ever seen it. Carson became enchanted with the ocean and vowed to devote her life to the study of marine biology.
After her father’s death in 1935, Carson began writing radio scripts on SCIENCE issues for the U. S. Bureau of Fisheries (the forerunner of the Fish and Wildlife Service) in Maryland. A year later she was appointed aquatic biologist. Her first book, Under the Sea Wind (1941) was an extension of a widely acclaimed article she published in the Atlantic Monthly. Carson’s flowing prose and her dramatic representation of sea life made science accessible to the public in a way that had not been done before. The book went unnoticed by critics, however, and Carson devoted more time to her work at the Bureau of Fisheries, where
World History
