The quarter century following the Second World War proved to be an era of unparalleled prosperity in the United States. Six years of war production, both before America’s entry into the war and during the war, ended the last vestige of the Great Depression of the 1930s. Because of the Cold War, military spending continued as a major economic force, as it does to this day.
The industrial push of the war was a factor, but changes in the American population also came into play. The war transformed the American workforce, brought agricultural workers into the cities, and increased the education and skills level of millions of Americans. The war did not erase poverty, racism or the divide between social classes, but it went far toward giving large groups of Americans the notion of social mobility, the ability to carve out a career different from ones parents, to live wherever one pleased, to start a business. The G.I. Bill of Rights program subsidized college education for returning service men, many of whom would never have otherwise contemplated higher education. The very mood of the country was one of possibility and achievement.
As millions of service men entered the economy, they began to start families, purchase or build homes, and purchase the automobile they would need to support the mobility they had merely dreamt of during four long years of war. The homebuilding boom lasted decades, turning the United States from an urban and rural nation into a largely suburban nation, and giving fresh impetus to the automobile industry, fully tooled and ready to produce passenger cars instead of airplanes and jeeps. Financial activity, investment, and the availability of credit expanded to meet these needs, while the agricultural industry expanded to feed the millions of new mouths that came into being with the post-war “baby boom.”
To add to the prosperity, government activity was largely successful in promoting industry and employment, keeping inflation in check, and building public infrastructure.
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