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U.S. Economy and Industry during World War II

Despite all the warnings of war, the United States wasn’t completely prepared when World War II broke out. The Depression had rubbed out many of the country’s machine and tool industries, the military was woefully under-supplied, and many soldiers found themselves drilling with toy guns and wooden tanks.

In a way, however, the Depression was a good preparation for what was to come: Americans had learned to scrimp and persevere. And having been pushed into a fight, they were eager to oblige.

Gearing up of the industry needed to wage a global war on two fronts was handicapped by a lack of manpower. More than 15 million Americans eventually served in the military. Training and supplying them was a staggering challenge.

It took more than 6,000 people to provide food, equipment, medical services, and transportation to 8,000 soldiers. In addition, many raw materials, such as rubber, manila fiber, and oil, were in short supply. And to top it off, President Franklin Delano Roosevelt (FDR) was a great leader, but not a great administrator.

Nevertheless, Americans rose to the occasion. When FDR called for the production of 50,000 planes in a year, it was thought to be ridiculous. By 1944, the country was producing 96,000 a year. Technology blossomed.

When metals became scarce, plastics were developed to take their place. Copper was taken out of pennies and replaced with steel; nickel was removed from nickels. War-inspired pragmatism even affected fashions: To save material, men’s suits lost their pant cuffs and vests, and women painted their legs to take the place of nylons.

Other sacrifices were made as well. Gasoline and tires were rationed, as were coffee, sugar, canned goods, butter, and shoes. But the war proved to be more of an economic inconvenience than a real trial for most people.

Of course, all that military hardware had a hefty price tag. The federal government spent about $350 billion during World War II — or twice as much as it had spent in total for the entire history of the U.S. government up to that point. About 40 percent of that came from taxes; the rest came through government borrowing, much of that through the sale of bonds.

All that money had to go someplace. A lot of it went to the West, especially California, where 10 percent of all the federal war spending took place. But the American economy rose just about everywhere else too. The civilian workforce grew 20 percent. The Gross National Product (the total of goods and services produced) more than doubled between 1939 and 1945. Wages and corporate profits went up, as did prices.

In October 1942, Congress gave the president the power to freeze agricultural prices, wages, salaries, and rents. The Roosevelt Administration created the Office of Price Administration (OPA) to oversee prices and wages. But the OPA proved generally ineffective, and the economy mostly ran itself.

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