The Cold War BeginsChapter 36

Post War Economic Anxiety After war many Americans

worried that economy would slip back into depression.

At first these predictions seemed to be coming true• GNP dropped in ‘46 and ’47• Prices rose by 33% in ’46-47.• Strikes swept key industries.

In retrospect, these were simply rebound effects

Taft-Hartley

Republicans controlled Congress for first time in 14 years.

Passed the Taft-Hartley Act over Truman’s veto.

Labor hated this law. Why? Unions attempts to grow into new

areas and industries were frustrated.• South was resistant to unions. Why?• Workers in rapidly growing service sector

were hard to organize. Why?

Early Economic Moves Sold War factories and

other government installations at very low prices. • How does this benefit

business? Employment Act (1946)

creates Council of Economic advisors. Purpose?

GI Bill: Servicemen’s Readjustment Act of 1944. • Provisions?• Helps to expand the middle

class and absorb returning GIs

The Long Economic Boom, 1950-1970

The Economic Boom between 1950 and 1970 was the longest and biggest in the nations history.

It transformed the country. National income doubled in the 1950s

and doubled again in the 1960s. Americans 6% of the population but

40% of the wealth. Size of the middle class rose to 60%-

double that prior to the depression. Americans became consume-aholics.

Owning a car became standard, and two was better.

Is like the roaring 20s, but tinged with optimism.

New World for Women Women reaped huge benefits

from the post-war boom. New employment. Source of income and

independence to women. Effect of growth of service

sector Culture glorified women as

home-makers and mothers. Women react against gap

between stereotype and reality with women’s movement of the 1960s.

Causes of economic expansion

The war itself Continued military spending Cheap Energy Increase in productivity

• Education• New Tech

Shift in the nation’s basic economic structure

The Smiling Sunbelt For 30 years after the war 30 Mil.

people changed residences every year.• How does this change society?

Growth of the Sunbelt—South, Southwest and California grow at a rate nearly double that of the north.

Grow of Sunbelt fueled by federal spending.

The Rush To The Suburbs Starting in the 1950s white

middle-class fled the cities to the suburbs.

Reasons:• Federal loan guarantees made it

more economically attractive to own a home in the suburbs than to rent in the city.

• Tax deductions for mortgage interest, but not rent.

• New highways and car-ownership made it easier.

• Desire for the peace and prosperity of the new suburbs.

By 1960 one-in-four Americans lived in the suburbs, by 1990 half the population lives in suburbs.

Consequences of Growth of Suburbia

Construction industry booms—Levitt brothers/Levitt Town

Assenmbly line production of houses

Changes the pattern of life

Changes the nature of commerce.

White flight leads to impoverishment of inner-cities

The Postwar Baby Boom Baby Boom is the huge surge

in births in the 15 years after WWII.• Why it happened.• 50 Million new babies over 15

years.• Peaks in 1957

Baby boom has lasting consequences • Created a secondary baby-boom.• One of the prime targets of

advertisers; thus impact on popular culture.

• Many of those in the rebellious generations in the 60s and 1970s were baby-boomers.

Truman Shock of having a new

president. Truman much different

from FDR. Compromise VP choice,

only a middling Senator. FDR had left him largely

out of the loop Truman bio and

personality

Yalta: Bargain Or Betrayal February, 1945, Stalin, Churchill and

Roosevelt meet in Yalta. Issues:

• How to finish the war • What to do with Germany and Japan• How to handle rebuilding of nations

ravaged by the war. Agree to a multi-power summit in San

Francisco to work on a successor to the League of Nations (What becomes the United Nations)

Problems—Atomic Bomb not yet perfected and looks like will be a very bloody invasion of Japan.

US wants Soviet help to pin down Japanese troops in Manchuria and Korea.

Stalin unwilling

Yalta Assessed Yalta has been criticized:

• Sold out Poland and Eastern Europe• Gave the Soviets too much in China. • Russian help not needed in Japan • Soviets would have entered the war anyway • FDR was feeble and therefore was hoodwinked by Stalin.

Response:• Yalta was not a treaty—it was a statement of intents and

common purposes. • USSR already had effective control of Eastern Europe and

we couldn’t stop them from entering. • Yalta was an attempt to get all three allied powers on the

same page as the war reached its conclusion.

Reasons for Clash with Soviets Two preeminent military powers in

the world. Each had half of Europe. Each distrusted the other’s system Soviets were skeptical of US and GB Different visions of the post-war

world and each other Soviets and Americans had many

similarities that contributed to clash

Shaping The Postwar World Bretton Woods, NH, 1944—International

Monetary Fund. International Bank for Reconstruction and

Development (World Bank) United Nations Conference, 4/45

• UN Charter signed by 50 nations. • Security Council dominated by the Big Five (US,

USSR, China, GB, France). Each had veto power over any resolution.

• Assembly made up of all countries.• US Senate overwhelmingly ratifies US

participation

The Problem Of Germany Nuremberg war-crimes

trials. Germany divided into four

military occupation zones. • Berlin itself been divided

into four parts. Is a debate about what to

do with Germany.• Soviet proposal.• Americans want German

economically strong. Why?

Germany Divided Soviets exert strong political

and economic control over their section of Germany.

Soviets resist reunification of Germany. • What is Soviet motivation and

fear? American, British and

French zones united to form West Germany.

Soviet zone becomes East Germany

Berlin Blockade Soviets blockade Berlin in

1948 ending all rail and highway access to West Berlin. • First show-down between USSR

and US. • US airlift. Lasts for nearly a

year.• Airlift important symbol.• Soviets forced to lift the

blockade in 1949 1949 the two Governments

of Germany are formally established.