War has been a part of the lives of people since history began. People have battled over different things, ranging from roaming rounds in prehistoric times to control of the world in present day. This essay will analyze how economically smart war is, specifically World War I, from the view of the United States of America.
The US entered World War I in 1917; however, we entered the economic war long before that. The US had been supplying Europe with weapons, bullets, and other equipment into the war. The term mobilizing is used in warfare, but our economy was getting a boost without the US sending any soldiers out of the country. These products were inelastic, meaning that the consumers of the goods were unresponsive in change in price.
For the US, this meant that they could set prices at extreme prices and the countries that could not make these goods themselves or get from another source had to buy the goods at these extreme prices. This created an economic boom for 44 months from 1914-1918. This also eased the process of the US joining the war. It was not as economically straining to mobilize for war because some facilities that would be used for the war were already functioning close to the production possibilities curve. This means that the facilities were functioning at maximum efficiency.
During this time period, the unemployment rate went from 7.9% to 1.4%, showing that as soldiers left to go overseas, jobs opened up on the home front. However, the war had to be paid for somehow, and this somehow came on the form of taxes and bonds. Takes were raised from anywhere from 20%- 60%. War bonds were bought by citizens and were promised to be repaid with interest after the war. However this also would lead to the downfall in the Great Depression, as the government would have no money left to pay the population back with.
In my opinion, war has a greater value than the debts it creates. It is about “flexing your military muscles” to make sure order is kept in the world. Some of the things that soldier’s lives are lost for are found many years later in the forms of our rights and freedoms and do not have a value that can be expressed in dollars and cents. Because these do not have prices, it is a personal opinion weather a war is economically worth the risk. However, I feel that it is worth being able to live the life that I have now than suffer under laws enforce upon our country by the would-be conquers of my homeland.