Chapter 2- Economic impact of WW2 and post war development

Affluence and Consumerism

American consumers spent money they saved during WW2 ($100 billion) Hire purchase & consumer credit made it easier for Americans to 'buy now, pay later' Growth in population meant greater demand for goods

Why did the American industry expand?

Big Business and War effort= Roosevelt called leading industrialists to get advice on meeting wartime production demands (e.g. General Motors produce machine Guns) Effects of the war on the economy= Industry expanded due to lend lease programme and by 1960 became the strongest economic power in the world Workforce= Conscription saw 16 million Americans serving in the armed forces 4 million workers migrated to North from South to help in the factories Employment in women had 50% rise

The Flaws

Many Black Americans remained underprivileged so couldnt share in the prosperity 1959= 29% of population in poverty 1955= 40% of New York's welfare recipients were AAs America lagged behind in effective pension ad welfare services due to the medical care rising

American industry after WW2

Military spending= Billions of dollars went into weapon reseach and development Cold war led to a rise in defence spending Open trading= Demands from Europe kept US production high Industry and economic expansion = Created greater employment opportunities in industries (e.g. aircraft production and food). End on 1940s- America produce 1/2 of the world's manufactured goods

Suburbanisation

Suburbs embodied the American Dream for young couples Houses were reasonably prices with low interest rates which made mortgages affordable Post war affluence increased spending power Between 1945- 1960, a baby boom increased population by 40 million and increased demands for new homes

How did war affect America's economy?

Unemployment fell rapidly ( By 1944, unemployment was 1.4%) Many factories changed to war production which created 17 million new jobs Demand in US farm products and prices rose Government spending doubled 16 million citizens served in armed forces Traditional industries expanded due to government contracts

Standard of living

Was 3x the standard living of an average Briton Shopping became a recreational activity In new homes, modern conveniences were expected By 1960, 90% of homes had TV sets