In 1920 the labor movement was roaring, with union membership over 5,000,000. This solidarity had begun with simple trade unionism —-a kind of organizing that divided different workers within each industry according to their skills, often barring women and people of color. It had evolved toward organizing workers along industry lines, regardless of their skill, sex, or race.
Workers unionized in an effort to procure fair wages, shorter workdays, and safer working conditions. Despite often-vicious opposition and charismatic but contentious leaders, this industrial unionism made tremendous gains and began to challenge the politically-backed power of industry.
Different labor organizers routinely published articles and lectured around the country articulating different approaches to the problem. Eugene Debs adopted socialism and ran for the U.S. presidency five times between 1900 and 1920. Bill Haywood, one of the founders of the Industrial Workers of the World (I.W.W.), was also a socialist and allegedly advocated violence and sabotage. Emma Goldman, a supporter of unions, preached anarchism because she believed that all governments were based on coercion and force.
Starting in 1917, as American soldiers marched into France, Woodrow Wilson crafted espionage and sedition laws aimed at silencing these views. Because criticizing the government was made illegal, Debs, Haywood, Goldman, and hundreds of other labor leaders were arrested and sentenced to prison terms as long as twenty years. Wilson's crackdown on union leadership, capitalizing as it did on rising fears of communism and socialism, significantly weakened the labor movement and cleared the way for the laissez-faire capitalism of the Twenties.
After the war, the relatively debt-free U.S. economy was spurred to become highly speculative throughout the decade, a trend that ended in the Great Stock Market Crash of 1929. While precipitated by the small percentage of the population that traded on Wall Street, the crash devastated an entire nation of working people—an incongruity at the heart of labor's complaint against capitalism.