Question

Why was there not another debt crisis after WW II? (with ref to Australia)

Answer 1

World War II was a international war for a period from 1939 to 1945. At the end of WW II, the debt of Australia was nearly over 120% of GDP however Australians did not pay off their debt for generations. The government of Australian in the post-war years instead to focus on paying off the debt by increasing taxes and reducing spending, concentrated on building a robust manufacturing sector, creation of the full employment economy, creating the Commonwealth employment service for helping it's people in finding the work, and making enough public investments in good infrastructure, inclusive of a huge build of public housing. Consequently after WW II Australia experienced a “boom” time that lead to the most prosperous middle-class society on earth,; with higher living standards and a decline in the inequality. Strong growth in an Australian economy shrank the war debt effectively as a proportion of GDP, and as a result the country returned to pre-war levels in period of ten years. Australian government belief that strong social safety net; world-class education; access to affordable housing; and good jobs with decent incomes will never punish the generations in the country for the debt. Thus a strengthen Australian economy never faced any debt crisis after WW II