Question

What were the long-term effects that World War 2 had on the economy of the United States? What were the short-term effects that World War 2 had on the economy of the United States?

Answer 1

The United States had remained neutral in the war until Japan attacked a naval base at Pearl Harbor, Hawaii which prompted US to declare war in 1941. It had some long-term and short-term impacts on US economy.

Some of the short-term impacts were as follows:

• The US economy was fully converted into a war-time economy
• American manufacturing companies shifted from manufacturing consumer goods to military equipment. Aircraft production had increased. This has helped bring the Great depression of 1930's to an end
• As a result of these new production activities, more jobs were available.
• Many had left behind their jobs and joined the armed forces as a result of which the nation also faced a labor shortage. This was the time when women entered the workforce
• The government was in need of more money to support the war and several campaigns and programs were launched. Some of them were

• The Americans were encouraged to purchase bonds to help in financing the war
• Rationing was started where every family was given a ration book, this encouraged them to only buy what was necessary

Some of the long-term effects were;

• To go back from the military production to a consumer production was difficult.
• This shift has resulted in a decline in overall military spending and Federal Spending however the American economy in terms of its GDP continued to grow as the high level of military spending had resulted in creation of a network of companies, universities, non-government organizations and Federal Agencies
• America’s financial aid to Europe and Japan helped tie the economic re-construction of Great Britain, France, Germany and Japan to American trade.