Summary of Economic and Social Impact of WWI

Economic Conditions Before and During WWI

  • Global Context: Pre-war Europe faced economic depression; businesses shut down, resulting in high unemployment.

  • Germany's Response: Rapidly mobilized under war conditions, facing labor shortages.

  • US Economic Situation: Contrastingly, the US experienced economic growth (1914-1918); low unemployment replaced by high demand for labor due to war supplies.

American Legion and Nationalism

  • Formation of the American Legion (1919): Called for promoting '100% Americanism', emphasizing patriotism and suspicion towards immigrants.

  • Goals: Combat anti-American tendencies, educate immigrants on American principles, and instill Americanism in schools.

  • Activities: Local posts urged to detect anti-American activities and encourage patriotism.

War Impact on Society

  • Women's Contribution: Women’s roles expanded in wartime; they worked in factories, farms, nursing, etc.

  • Advocacy for Suffrage: Emphasized women's integral role during the war, advocating for their right to vote.

Economic Boom and War Spending

  • US Entry into WWI (1917): Marked by significant federal spending, shifting focus from civilian to military production.

  • Labor Force Changes: Unemployment dropped from 7.9% to 1.4%, more individuals joined the military and manufacturing sectors.

Government Intervention

  • War Industries Board (1917): Organized production for the war effort, establishing a precedent for later government economic intervention.

  • National War Labor Board (1918): Ensured labor support for the war, pushing for workers' rights while preventing strikes.

Financing the War

  • Total Cost: Estimated at approximately $32 billion (52% of GNP).

  • Funding: Primarily financed through public war bonds (approximately $21 billion), complemented by increased taxation and new money creation.