The Development of the USA, 1929-2000: Economic Changes by the 1960s

The war acted as a catalyst for recovery, leading to a time of relative prosperity and the pursuit of the “American Dream.” However, “poverty amidst plenty” still existed.

War Footing: Upon entering the war, the US shifted to a war footing, with industry focused on producing armaments and military equipment.
War Production Board: Roosevelt established the War Production Board to coordinate production among companies. For example, General Motors produced heavy machine guns.
Weapon Production: By 1944, the US was producing almost 50% of the world’s weapons.
Lend-Lease Program: Industry expanded due to the Lend-Lease program, which aided wartime allies.
Reduced Unemployment: Increased job opportunities and conscription led to a significant decrease in unemployment. In 1939, unemployment was at 9.5 million; by 1944, it had dropped to 670,000.
Economic Powerhouse: By 1945, the USA had emerged from the depression and had the most powerful economy in the world.

Lend Lease: A system by which the USA aided wartime allies.
War Bonds: Bonds bought by citizens to help the war effort.
Fair Deal: The domestic policies of Truman.
Suburbia: Residential areas outside towns and cities.
Affluence: Times of increased wealth and prosperity.
Baby Boom: A temporary marked increase in the birth rate.
Gross National Product: Total value of goods produced by a country in a given period.
Hire Purchase: Buying on credit by paying installments.
Conscription: Requirement for citizens to join the armed forces.

Dec 1941: The USA enters the war, ushering in an economic boom.
1942: The War Production Board is set up to prepare for the needs of war.
1945: Roosevelt dies, and Truman introduces his Fair Deal.
End of the 1940s: The USA is producing over 50% of the world’s goods.
After 1945: The rise in defense spending during the Cold War sustained the economic boom.
1953: Eisenhower is elected president.
1959: 29% (50 million) of the population is living below the poverty line.
1960: The standard of living of Americans was 3X that of Britons; 25% of Americans lived in suburbia.

War Bonds Cashed In: Millions of US citizens had purchased war bonds to help the economy. After the war, these were cashed in, injecting $200$ million into the economy.
Car Industry Boom: The car industry experienced a resurgence, with sales of new cars rising to $6.7$ million by 1950.
Housing Demand: There was a high demand for new houses for returning troops. Coupled with low-interest rates, the construction industry boomed.
Cold War Spending: The development of the Cold War in the 1950s led to increased defense spending, contributing to the economic boom.
European Demand: Demands from war-ravaged Europe kept the order books of US companies full.
Continued Progress: Subsequent Presidents, Truman and Eisenhower, continued to promote economic and social progress, contributing to the prosperity of the times.

Affluent Society: The years after World War II saw the emergence of an affluent society.
Consumer Goods: With more spending power, US citizens were eager to buy consumer goods, notably cars and televisions.
Hire Purchase: The availability of hire purchase increased consumer credit and purchasing power.
Increased Efficiency: Increased efficiency and expertise of the workforce allowed for goods to be produced more quickly, which lowered prices and increased demand.
Standard of Living: By 1944, the standard of living of the average American was three times that of the average Briton.
Suburbanization: Many middle-class citizens moved to new houses in the suburbs to abandon the pressures of city living.
Car Ownership: Increased car ownership meant workers could commute to work.
Affordable Housing: Houses were affordable due to low-interest mortgages.
American Dream: Suburbanization was central to the creation of the “American Dream.”

Unequal Distribution: Not all Americans shared in the affluence of the post-war years.
Social Underclass: Many citizens, especially black Americans, remained part of a social underclass, surviving below the poverty line.
Welfare Dependence: In 1955, 40% of New York’s ghettoized black Americans were recipients of welfare.
Regional Disparities: The problem was regionalized, with people in the southern states lagging behind those in the north and on the west coast.
Lack of Social Services: With no national health service, the USA lagged behind many European countries in providing pensions and welfare benefits.