Impact of the war economy on America

Question 1

What was the overall impact on the USA

Answer 1

• By 1945 national debt was $260 billion, rising from $41 billion in 1941.
• To pay for the war, war bonds was introduced and paid for 50% of the war.
• To pay for the war taxes were increased - those earning above $200,000 paid 94%.
• Taxpayers increased from 7 million to 42 million in 1944 due to greater employment.
• New Industries such as synthetic rubber and medicines, namely Penicillin.

Question 2

Impact on the workforce

Answer 2

• 1944 Unemployment 1.2%
• 15 million servicemen and women called up
• 6.5 million women at work
• 66% of teenage boys working
• Average wages increased by 40%, whilst prices only rose by 28%
• Average weekly wages went from $24 to $44

Question 3

Impact on government control of the economy

Answer 3

It increased for example:
-1943 Office of War Mobilisation rationed: meat, sugar and petrol. It also stopped the production of non-essential items like cars.

• Aug 1941 Office of Price Administration and Civilian Supply - to control inflation.
• Complete government intervention in March 1942 by freezing prices. Almost 90% of food was under price controls
• Jan 1942 National War Labour Board - determine wages tried to stop wages rising too far above 15% from Jan 1941.
• Jan 1941 War Production Board supervised output of $183 bn worth of weapons and supplies. Allocated resources and coordinated the change from civilian to war production.
• Oct 1942 Office of Economic Stabilization - further monitoring wages and prices

Question 4

Impact of the war on Industrial Relations

Answer 4

• No strike agreements with two major unions - American Federation of Labour (AFL) and Congress of Industrial Organisations (CIO).
• Membership of unions grew to 14.75 mil
• Lots of short stoppages. During the war there were 14,471 strikes including nearly 7 million workers claiming that conditions were unfair
• Some major strikes such as 400,000 coal miners in 1943 stopping for 12 weeks
• New Industries such as synthetic rubber and medicines, namely Penicillin.

Question 5

Impact on Migration

Answer 5

• Population of California rose by 72%.
• Many urban areas had housing shortages
• Population of rural areas fell by 29% people moved looking for work in more industrial areas (more jobs).
• Led to social dislocation - divorce rate rose from 20% in 1940, to 29% in 1945.
• 12% of population moved to urban areas and centres of production. 1 in 8 had moved to look for work by 1945.
• Five million black Americans migrated to cities, one million found work in defence industries

Question 6

Impact on society

Answer 6

• The number of teenagers finishing high school dropped from 6.6 million in 1940 to 5.6 million 1944
• 1940 Smith Act: illegal to threaten to overthrow the government
• 1940 Selective Service Act introduced conscription for men aged 21-35, then 18-45 later in 1941.