Great post above. To add to that, when unemployment surged as hundreds of thousands of troops were mustered out of the military, and a sharp drop in government orders for war materials further dried up employment opportunities, there was a correspondingly sharp rise in xenophobia and general anti-immigrant and anti-Jewish sentiment. Membership in the Ku Klux Klan, glorified and popularized once again, this time by the movie The Birth of a Nation, led to widespread discrimination and violence against immigrants, Jews, Catholics and, as always, African-Americans.
At least part of the reason for these trends can be traced to the immediate post-World War I recession.
Of course, one effect of any recession is that people become poorer and have harder lives. This happened after WWI. However, there were larger impacts of this particular recession as well. There are two major, and interrelated, impacts of this recession.
- First, there was labor strife. After the war, there were many large strikes around the country. Perhaps the biggest of these was the general strike that was called in Seattle in 1919. In that year, more than 4 million workers went on strike across the US (Tindall and Shi, America: A Narrative History, Fifth Edition, p. 1158).
- Second, and partly because of these strikes, there was the Red Scare. This was a crackdown on radicals of various sorts. They were seen as the motivating force behind the strikes and were (partly because of the creation of the Soviet Unions) seen as a threat to the US.