World War II:
Origins of World War II
- In Germany: the Great Depression brings Hitler to power
- No Great Depression in Germany, no Hitler
- Hitler takes his Malthus too seriously
- Believes that only a populous Germany can be a strong Germany
- Believes that only a Germany with lots of farmland can be a populous Germany
- Hence wants to do to the Poles and the Russians what the Americans did to the Indians
- Roosevelt eager to fight Hitler to the last Briton (and give them plenty of materiel in the meantime)
- America not so eager
- How eager was Roosevelt to commit America to World War II in Europe? Not clear.
- And after Pearl Harbor it was Germany that declared war on the United States
- In Japan, the Greater East Asia Co-Prosperity Sphere
- Takeover of Manchuria in 1931
- War with China beginning in 1937
- Occupation of Indo-China in 1940
- Roosevelt's ultimatum: Withdraw from Indochina (and China?) or we'll cut off your oil
- Dean Acheson at the State Department did indeed cut off their oil
- Pearl Harbor as the response
Rough Numbers with Respect to Military Production (as percent of Nazi Germany):
- 450%: U.S.
- 150%: Britain
- 100%: Germany
- 80%: Russia
- 25%: Japan
- 15%: Italy
The wonder is not that the allies won given that they decided to fight
- The wonder is that they decided to fight to the end
- The wonder is that the axis powers held on for so long.
- Out-produced five-to-one
- Professional excellence of the Nazi Army...
- Professional excellence of the start-of-war Japanese fleet...
50 million dead in World War II
- 6 million Jews
- 5 million Chinese civilians
- 8 million Russian civilians
- 4 million Russian POWs
- 2 million Polish civilians
- Et cetera...
- Plus all the battle and military deaths...
World War II Cured the Depression in the U.S.:
- Extraordinary levels of aggregate demand
- spending--military spending--rises to 40% of GDP
- The ten-million man army
- Unemployment down to 2% or lower
- Rosie the Riveter
- Price controls and rationing
- After WWII, few doubted Keynes's claim that government could control the economy
Trying to stop the return of the Great Depression: The Employment Act
Trying to stop the return of the Great Depression: The Marshall Plan
Eichengreen and DeLong's interpretation of the Marshall Plan: key benefit that it allowed the good "mixed economy" guys to win the political struggle in Western Europe
- Alternatives? Populist statists a la Peron--and stagnation
- Alternatives? Communists--and eventual stagnation
- Alternatives? Right-wing "hold what we have" semi-fascists
Are Eichengreen and DeLong right?
- Perhaps the threat from Stalin had as much to do with post-WWII "consensus" politics in Western Europe as the Marshall Plan did... * Perhaps good leadership: Schumann, Monnet, de Gasperi, Attlee, Adenauer, Erhard...
Postwar:
After the Postwar: Productivity Slowdown and End of the Population Explosion:
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