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Ww2 Economic Boom

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The United States experienced an incredible postwar economic boom after World War II. Additionally, this economic expansion is known as one of the few times in the post-industrial revolution era when inequality between economic groups shrunk, as exhibited by America’s Gini coefficient falling, albeit slightly, starting in the 1940s and continuing up until the mid-1960s. (Lindert, p. 2-652). Ostensibly, a rising tide of economic growth seemed to be lifting the boats of both the wealthy and the working class. The strong and steady income gains and economic growth of the postwar boom proved temporary as the historic anomalies that came about after the end of World War II began to fade in the face of an increasingly competitive global economy. …show more content…
It is tempting to view the postwar boom period ending in the early 1970s as simply being a triumph of liberal forces: unions successfully fighting for better wages and benefits; Congress passing transformative social legislation; income inequality falling. However, these positive developments enjoyed by the majority of Americans at least partially derives from the temporary position of strength America found itself in after World War II. Outside of the United States, the industrial capacity of the world economy had been devastated. Combined with the active stance taken by the American government in response to competition with the USSR, American companies enjoyed little competition and high growth. This ended as countries like Germany and Japan rebuilt their economies. For companies like Rockwell International, a major American conglomerate, this competition proved too much. With Japanese competitors “aggressively dump[ing] low-cost televisions to capture the U.S. market” Rockwell never turned a profit on its television subsidiary, known as Admiral, which it had purchase in the early 1960s (Broughton, p. …show more content…
This changed in the 1970s as those advantages derived from America’s dominant global position began to erode. As the growth of the proverbial economic pie began to slow and even stagnate, the owners of capital, whether they be investors in New York City debt or Maytag exerted influence on society to create a more conducive environment for capital. That meant weakening labor unions, shrinking government social programs, and stabilizing the dollar’s value, to name a few political aims. New York City’s dramatic debt crisis in the mid-1970s exemplifies the struggle by the owners of capital to increase their influence. Financiers pressured city government officials through organizations like the Financial Community Liaison Group, which was created “to adopt reforms that would reassure investors” (Freeman, p. 257). Ultimately, they won as an austerity budget known as MAC cut municipal employee benefits, public transportation, and social spending to balance the budget (Freeman, p.

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