SAT Subject US History Practice Question 765: Answer and Explanation
26. An important effect of the increase of open shops and "company unions" in the 1920s was
A. a weakening of the agricultural sector of the economy.
B. an increase in the purchasing power of workers.
C. a strengthening of the Democratic Party.
D. a weakening of the labor movement.
E. improved working conditions.
Correct Answer: D
An open shop is a nonunion shop. Company-controlled unions and benefit plans initiated by management, which came to be known as welfare capitalism, undermined calls for a union by the workers. Both open shops and company unions weakened the labor movement, which lost ground from 1920 until the New Deal. A weakened labor movement meant that working conditions (E) did not improve and wages (and thus purchasing power) did not increase (B). The agricultural sector did become weaker as the decade wore on, but that was largely due to overproduction (A). The Democrats failed to capture the White House and remained the minority party during the conservative 1920s (C).