Effect of WW2 on the economy (T2) Flashcards
How did Churchill adapt the economy for the war?
- Expanded the government’s role in managing the war economy
- Created a series of ministries - these had specific roles in economic management
What were the ministries that Churchill set up to manage the economy like?
They had extensive powers of economic management
How did the government control prices of products during WW2?
Through controlling production levels
How did the national government change the British economy during WW2?
Transformed Britain into a managed economy
How did the National Government change the British economy into a managed economy during WW2?
- Rationing & conscription introduced immediately
- Registration for employment made compulsory in 1941 - 8.5 million work orders issued
- By 1945, 1/3 of citizens involved in war work
What did the growth of state intervention during WW2 lead to?
A huge increase in war production and military spending
Between 1941 and 1945 how much of government spending was on the military?
Over half
After WW2 what was military spending like?
It continued to be a priority for the government- who wanted Britain to be in possession of her own atomic bomb
By 1951 how much of the GDP was spent on defence?
Over 10%
30% of total government spending
How did WW2 change Britain’s economy overall?
A turning point for Britain being able to finance its commitment all over the world
By 1940 what were Britain’s cash reserves like?
They were gone - Britain gradually became indebted to other countries around the world
They relied on loans and then later financial aid
What agreement was Churchill able to secure with the USA?
The Lens-Lease Agreement
What was the Lend-Lease Agreement between the USA and Britain?
Allowed the USA to supply Britain with what it needed and the debt would be paid after the war
What supported the Lend-Lease Agreement between the USA and British?
The ‘Liberty Ships’ brought supplies from America to Britain
After WW2 what did John Maynard Keynes negotiate with the US & Canada?
Immediately after the war he negotiated a £2.2 billion loan - it was nowhere near enough
