Postwar Prosperity at
Home: 1945–1960
Postwar Financial
Fears
As World War II drew to a close, many
Americans worried about the domestic economy. Although the war had spurred
employment and production and had pulled the nation out of the Great
Depression, the war economy couldn’t last forever. Moreover, millions of
veterans would soon return home in search of jobs that might not be there
anymore. As inflation soared, many feared that the immediate postwar recession of 1946 and 1947 heralded
the return of the Great Depression.
Truman and Congress took steps to address the
economic downturn. In 1946, for instance, Congress passed theEmployment Act,
which created the Council of Economic Advisors to help Truman
maximize national employment.
The Taft-Hartley Act
During the recession, literally millions of
industrial laborers went on strike to protest inadequate wages. Truman
continued to support the labor unions as he had during the war, but
conservatives feared that halting industrial production would severely cripple
the economy. To remedy this problem, Republicans in Congress passed theTaft-Hartley
Act in 1947,
over Truman’s veto, to restrict the influence of unions. The act outlawed
all-union workplaces, made unions liable for damages incurred during interunion
disputes, and required labor organizers to denounce Communism and take oaths of
loyalty.
The Montgomery G.I.
Bill
Perhaps the most important measure taken in combating
the recession was theMontgomery G.I. Bill, which Congress had passed in 1944 to help
the 15 million returning U.S. veterans reenter the job market. Also known as
the Servicemen’s Readjustment Act and the G.I. Bill of Rights,
the G.I. Bill gave government grants to any veteran who wished to return to
school. Neither Truman nor Congress predicted that more than half of returning
veterans would take advantage of approximately $15 billion in federal grants to
attend vocational schools, colleges, and universities. The G.I. Bill also set
aside an equal amount of money to provide veterans with loans for new homes,
farms, and businesses.
Historians have since hailed the Montgomery
G.I. Bill as the most significant law passed to address the concerns of the postwar
years. It reduced fierce competition for jobs after the war and boosted the
economy by helping millions of workers acquire new skills. Many have claimed
that the economic boom in the 1950s would never have happened at all without the
G.I. Bill.
The Postwar Boom
Indeed, the U.S. economy recovered quickly
from the brief recession of 1946–1947and then veritably exploded, making Americans
the wealthiest people in the world. For approximately twenty years, the U.S.
economic surge seemed unstoppable. Within just a few years, almost two-thirds
of American families achieved middle-class status. Gross national
product (GNP) more than doubled during the 1950s and then
doubled again in the 1960s. By 1960, most American families had a car, a TV, and a refrigerator
and owned their own home—an amazing achievement given that fewer than half of
Americans had any of these luxuries just thirty years earlier.
Foundations of Prosperity
Wartime industrial production and unprecedented defense spending during the1950s and 1960s
fueled the economic boom. Whereas the manufacturing infrastructures in Great
Britain, France, and Germany had been destroyed by invasion and bombing,
American industries had remained completely untouched and therefore benefited
greatly from the war. Federal dollars—roughly half of the congressional budget
in the 1950s and 1960s—later
kept these war factories running throughout the Cold War. Low oil prices, along
with Eisenhower’s investment in transportation infrastructure with the Federal Highway Act in 1956, also
boosted the nation’s overall economic strength. Improvements in education
thanks to the G.I. Bill also improved workers’ productivity.
White-Collar Workers
The shift in the economic base away from agriculture and manufacturing and
toward“white-collar” jobs also
contributed significantly to the postwar boom. By 1960, the
family homestead that had once dominated American economic life even up to the
turn of the twentieth century had all but disappeared. Instead, corporate
“agribusinesses” had take over agricultural production by using machinery that
was more efficient than farmhands. Similarly, white-collar workers rapidly
began to outnumber “blue-collar” manual laborers for the first time in U.S.
history. This transformation contributed to the decline of labor unions in the latter half of the twentieth
century.
Scientific Progress
New scientific
discoveries and technological developments also spurred the economic boom.
Federal grants encouraged companies to invest in research and development to make production more efficient.
Government money also subsidized the development of commercial airlines, which
contributed significantly to the economy by transporting goods and people
across the country within hours rather than days or weeks. The development of
the transistor rapidly transformed the electronics
industry and resulted in the formation of new technology corporations.
Nutrition and public health also improved during these years. Jonas Salk’s development of the polio vaccine in 1952,
for example, effectively eliminated a disease that had killed and crippled
hundreds of thousands of Americans in the past, including former president
Franklin D. Roosevelt.
Migration and
Population Boom
Meanwhile, the U.S.
population redistributed itself geographically and grew dramatically during the
postwar years. Improvements in transportation mobilized Americans: whereas the
railroads of the Gilded Age had opened the West, interstates and airplanes
developed it. During the 1950s
and 1960s,
millions of Americans left the East for the West, South, and Midwest. Federal
grants to these regions contributed to their development. As a result,
populations doubled, tripled, and even quadrupled in California, Arizona, New
Mexico, Texas, Florida, and other so-called Sun
Belt states. By the early 1960s,
California had become the most populous state in the Union. On top of this
migration, the postwar “baby
boom”between 1945 and 1957 increased the U.S. population rapidly,
as young Americans took advantage of the postwar peace and their increased wealth
to start new families and have children.
The African-American
Migration
Blacks, meanwhile,
continued to move in large numbers from the South to northern and northeastern
cities—a move that has become known as the African-American
migration. The Great Depression, the invention of the mechanical cotton
picker in the 1940s,
World War II, and the prospect of jobs in northern cities prompted more than a
million blacks to leave the South. This migration improved blacks’ overall
economic status and ultimately helped make the civil rights movement possible.
The Growth of the
Suburbs
As blacks moved to the
cities, many whites moved out of urban areas and into the suburbs. This pattern
came to be known as “white
flight.” New housing
developments, higher incomes, G.I. Bill loans to veterans, and the construction
of interstates all contributed to the massive growth of American suburbia during the1950s. The
rapid development of shopping malls and fast-food restaurants matched the
growth of the suburbs. Amusement parks, credit cards, and the availability of
cheaper consumer goods followed as well, and Americans quickly developed the
world’s foremost consumer
culture.
The Entertainment Explosion
Consumerism, in turn,
prompted the entertainment
industry to invent new ways
for Americans to amuse themselves. By the mid-1960s, 90 percent of American families owned
televisions, and more and more spent the bulk of their free time watching TV. Sitcoms, such as Leave It to Beaver, Ozzie and Harriet, and I Love Lucy, were particularly
popular because they idealized the new American consumer lifestyle.
The new musical genre of rock
and roll gained popularity
among American youth. Sexually charged songs by artists such as Elvis Presley,
Buddy Holly, Chubby Checker, and, later, the Beatles dominated the airwaves and
transformed popular music. At the same time, many new American writers in the 1950s,
including members of the Beat
Generation, such as poet Allen Ginsberg and author Jack Kerouac, challenged
the new consumerist conformity that pervaded American life.
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