WW1 and the 1920s
Impacts of the First World War on the US and the problems that loomed after the 1920s
WW1 and the 1920s
American Neutrality came to an end when the US Congress authorized the mobilization of over three million men after the war was officially declared against the Germans on April 4th, 1917. This had several diverse effects on the US, especially their economy CITATION Fri15 \l 1033 (Frieden, 2015). By the end of the war in 1918, America had produced a lot of ammunition which included twenty million artillery rounds, twenty-one thousand airplane engines, three million rifles and large amounts of poison gas. This production required a seriously large number of workers whose demand was increased by the flood of money pouring into the manufacturing sector from aboard due to higher demands. The US unemployment rate dropped from 16.4% to 6.3% in just two years into the war due to conscription of almost three million young men, which created a shrinking job pool. In the total duration of nineteen months of the war, the US incurred costs of about thirty-two million, 58% of which were raised through the sale of "Liberty bonds". The US government also exercised some measures of price controls that prioritized the war contracts and allocated the remaining raw materials based on immediate need. But we cannot rule out the fact that the American involvement in the war was short and limited, therefore the American were not able to control the devastating economic impacts that followed.
After the end of the First World War, the economic boom began to fade. The foundations of the doctrine of capitalism were starting to give way CITATION BBC \l 1033 (BBC). The average citizen was depending on their earning from the stock market. This started the problems of overproduction in the industrial sector, which emphasized the unequal wealth distribution in American society. In addition to that, the wages of the factory workers did not rose as quickly as the profits of the factory owners. Last and most important, the greatest boon in the American economy was the Great Depression of 1929, which not only affect the Americans, but also the world economy. The study of this economic calamity is of the most importance, as it is widely regarded as one of the principles causes of the Second World War.
BIBLIOGRAPHY BBC. (n.d.). Bitesize. Economic problems in the 1920s. Retrieved from https://www.bbc.co.uk/bitesize/guides/zp77pbk/revision/1
Frieden, J. A. (2015). Banking on the world: the politics of American international finance. New York, US: Routledge.
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