Immediately after WWI, it became clearly apparent that all other national economies outside the USA had all but collapsed completely. For the first time in history, a unipolar economic world had been created with the USA in as perfect a control of it as was possible to be at that time. Anxious to project her anti-imperial tendencies however, the USA took care not to be seen as overbearing as she could very well have been. She deferred as much as possible to both Britain and France when the Treaty of Versailles which brought the war to an end was being prepared. It is on record that those countries had come out from the war with their respective empires enhanced by the addition of territories to their colonial possessions in Africa and the Middle East.
US participation in the process leading up to the signing of the Treaty of Versailles, unlike what we got from the other members of the victorious alliance was, on balance moderate and could even be considered to be positive. Whilst the Europeans were fiercely vindictive, the USA fought to tone down the demands which the victors inflicted on the vanquished. In the end, the crushing weight of these demands ensured that the war was resumed with heightened ferocity only twenty years after the guns fell silent on the muddy Western front. The British, more than anything else wanted to eliminate the threat of German naval power. After all, it was the build-up of the German Imperial Navy that led to the ruinous arms race that put a huge dent into the pre-war British economy and has been described as one of the major causes of the war. To satisfy British interest in this direction, all the vessels which made up the German Navy were handed over to Britain as a way of fulfilling the relevant articles of the treaty. As soon as the Armistice which marked the end of hostilities was signed, all the ships of the line in the German Imperial Navy were interned in Scraps Flow off the coast of Scotland, awaiting the signing of the Treaty after which the vessels were to be handed over to the British as war booty. On the day the Treaty was signed however, the German High Command, in a final act of defiance sent the entire German fleet down to the bottom of the sea. This was to prevent the ships from being used to augment the already formidable British naval power. On their own, the French also regained the territories of Alsace and Lorraine which they had lost to the Germans in 1871. On top of these, the victorious allies heaped all the blame for starting the war on Germany and her allies and slapped a heavy indemnity on them. In appreciation of the need to restore the German economy as quickly as possible however, the Americans granted loans to Germany to pay those war debts. It is interesting to note that Germany only managed to pay off those loans long after the reunification of East and West Germany in 2010, fully ninety years after those loans were contacted.
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Woodrow Wilson, the bookish American President in an effort to prevent another world war tried to tone down the harsh conditions which the Allies insisted on imposing on Germany. Beyond that, he wanted to promote world peace into the distant future. One of the mechanisms with which this was to be done was the setting up of the League of Nations which was designed to find peaceful resolutions to international grievances as soon as they arose. Unfortunately, Wilson failed to get the ratification of this aspect of the treaty past his own Congress which refused to ratify it in an attempt to restore American isolationism in world affairs. This being the case, the USA was never a member of the League of Nations. Although virtually all independent nations joined the League, the absence of the USA was fatal to its intentions and its contribution to world peace was insignificant. After all, it failed miserably to prevent the outbreak of WW II. Before that, the League was unable to prevent the Japanese invasion of Manchuria in 1931, neither was it able to respond positively to the desperate pleas of Abyssinia (Ethiopia) when she was attacked and occupied by Italian forces in 1937. Czechoslovakia was similarly abandoned to her fate when she was attacked by Nazi Germany in 1938.
Throughout the twenties, the US economy dominated the world in every aspect. This was due to the power of her capitalists. Beginning from the turn of the century, American industrialists led the world on all fronts. Her engineers pioneered the production of household appliances which took the drudgery out of housework and gave washing machines, refrigerators, vacuum cleaners sewing machines and other such tools to the world. At the other end of the scale, the American motor industry was on song. Henry Ford had not only produced a car, the Model T Ford, more than fifteen million of which were produced over the years but had also introduced the assembly line to his factory. This mode of production made it possible for Ford cars to roll off the line swiftly. Ford was a great innovator who believed in making it possible for the workers to have easy access to his cars which were as lowly priced as to be made universally affordable and put America on wheels. He also paid decent wages to his workers even though he was implacably opposed to unions which he excluded from his factories. He was also colour blind as he not only employed black workers but paid them the same wages as their white counterparts. Black workers who were fleeing blatant racial injustices in the South flocked to the Ford factories in Detroit making that city the auto capital of the USA and the world. The glory may have now departed from Detroit but her place in the history of vehicle manufacture remains secure. Henry Ford was a model, a massive employer of labour whose contribution to labour relations was way before his time, which is why the Ford Motor Company remains important to the rise and rise of capitalism today. Henry Ford has disproved the notion that it is necessary to screw the workers in order to make a healthy profit. Unfortunately, too many industrialists are not convinced of the merits of paying their workers a living, not to talk of generous wages.
The American economy boomed as never before in the roaring twenties but it seems everything on earth is susceptible to the pull of gravity. Anything that goes up, must come down; eventually. Given that dictum, it may be said that it was inevitable that the American economy which was merrily cruising above the stratosphere had to come crashing down, back to earth. In any case, that is what happened when the great depression struck in the closing weeks of 1929. Many books have been written as to what was the cause of the great depression but what is apparent is that the great depression was brought about by a combination of factors each of which was weighty by itself. For several years prior to the crash, the stock market had been overheating even though there did not seem to be any foundation for the deals being made by a bevy of speculators. When the bubble finally burst, the whole rotten edifice came crashing down. Another, perhaps an additional source of instability is thought to be the imposition of the infamous Smoot-Halley tariffs. They were supposed to protect the American economy against foreign competition but the foreigners fought back with tariffs of their own to the detriment of the American economy which was consequently blown down like the proverbial house of cards. Whatever the cause, the immediate effects led to bank closures, bankruptcies and the wholescale loss of jobs. The country was broke overnight.
The effects of the great depression was first felt in the USA but the ripples were soon felt all around the world. Times had been rough in Britain and this led to the general strike of 1926. The price of coal began falling in 1924 and in response, the mine owners decided not only to reduce wages but in addition to lengthen the working hours in order to maintain their profits. A typical capitalist response to the threat of a drop in profit. The miners rejected this proposal and the mine owners promptly locked them out. The miners went out on strike and were followed by members of other unions making it a general strike. But after only nine days the strike was broken and normal work was resumed. The general strike failed because members of the middle class and even the odd archbishop lined up behind the mine owners. The miners continued their strike for another six months but in the end they caved in and went back to work on reduced wages and longer working hours. The capitalists won a complete victory, their precious profits adequately protected. There was no way that the miners were going to be allowed to delay the rise and rise of capitalism.