In 1914 when war broke out in Europe, President Wilson declared America’s “Neutral policy”. Which was widely supported by the American people; however, when America joined the war in 1916, both the economy and society experienced benefits as well as drawbacks. The American economy was in a strong state before the war broke out. Due to its neutrality, the USA continued trade with Europe despite the war. In 1913 the value of American trade was about $2 billion, but by 1916 it had risen to $6 billion.
Also, the increased level of production within Germany meant that the industry would grow, and the social welfare constitution proved that the public would have backing from the government with pensions and benefits. However, there were factors which disagreed with the statement as there was a grand coalition within this period that could not co-operate together. Also, Germany being dependent on foreign loans meant that their economic development was not increasing. As well as this, there were still differences within the public in Germany decreasing the social progress in the mid 1920’s. Although, to a certain extent the statement is true as Germany did show that they experienced a period of political calm, economic development and social progress in the mid 1920’s.
During the war, the US has increased in defence spending. US navy ships rose from 600 to 1000, air force increased from 42 wing groups to 72. Which also helped the US to be equip itself to be the ‘World’s police officer’ This shows how the US military gained a lot of money from the War benefiting them in war, as they were better armed. As a result this raised more businesses to profit from more defence weapons as they were popular in demand (‘the military-industrial complex). Therefore the money raised helped the American economy and living standards which hence shows how the Americans could be seen as the successors of the War.
To a large extent Germany was very economically stable as Stresemann introduced a new currency and gained loans from the USA under the Dawes plan. The Dawes plan was produced in 1924 by Gustav Stresemann, it was a USA backed plan which helped to stabilise the economy greatly. The first part of the plan was the introduction of the new rentenmark which would now be worth 100 of the old mark. The plan also gave Germany 800 million marks in loans to aid their economy. The introduction of the rentenmark greatly improved Germany’s economical stability as it helped solve the inflation crisis.
The Second Five-Year Plan had enabled military preparation, and by 1942, 50% of national income was being spent on the war (military production almost doubled between 1941-44). In addition, during the war Gosplan organised the relocation of Russian industry from areas under Nazi threat (1,523 factories had been moved by November 1941). This ensured that Russian industry could continue to produce goods. Economic might therefore played an important role in helping the country win the war, because without such a strong war economy, it would not have had the arms or industrial goods necessary to defeat the Germans. The Soviet people also played an important role.
The European economies were exhausted by the cost of waging a long war. In comparison, the USA grew rich during the war years. Its late arrival to the war, and the fact that its cities and industries were not bombed or destroyed during the conflict, meant that at the end of the war it was able to capitalise on the perilous state of European industry and dominate their markets. The First World War was very beneficial to America as during this time America’s food
Through policies like Marshall Aid they pumped a lot of money into Western Europe. Marshall Aid had acted like a catalyst for economic recovery in Western Europe. They felt that by building up war torn countries, there was a much smaller chance of communism being able to take hold. USA believed that poverty was a key condition for the spread of communism hence why they made an effort to build up various countries in Western Europe. A particularly good example of this was Germany when USA pumped a lot of resources into their area.
BRITISH MERCANTILE POLICY AND THE AMERICAN REVOLUTION Historians have debated the influence of Britain’s mercantile policy in the coming of the American Revolution. In my opinion, I think it was not a causal factor in the causing the war. Far from causing harm, the Navigation Acts brought enormous benefits to Americans, who did not object to mercantilist policies As we all know, mercantilism was formed in West Europe during the 15th and 16th century. The early mercantilists pursued the increase of the precious metals as currency in their own country. The requirement was to buy fewer foreign products but sell more of their own goods in order to achieve the purpose of maximizing the accumulation of precious metals.
Stresemann ended the hyperinflation crisis of 1923 by introducing a new currency, the Rentenmark, which was backed by US loans to replace the now worthless mark. This suggests that the period 1924-1929 were ‘golden’ to a certain extent as they managed to stabilise the German currency. In addition, the introduction of a new currency encouraged foreign investment in the German economy as other countries could be sure that the currency was stable and therefore a worthwhile investment and also increased industries and therefore solved the vast unemployment which had been a problem within Germany for many years previous to the Weimar constitution. The increase in industry is shown through the fact that by 1929 Germany was producing 33% more produce than in 1913, thus inferring that the ‘golden years’ were a turning point for Germany. Additionally, Stresemann negotiated the Dawes Plan in 1924 which softened the blow of reparations on Germany as well as securing loans from America which proved invaluable in turning around the German
They wanted to extend their political, military and economic control all over the world. With the booming economy in the United States in the late 1800s, there was a problem with the surplus of goods. Excess production led to declining profits. Americans needed more consumers to buy their products. Industrialists wanted trade to expand into new overseas market where American products could be sold.