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The US government, during the Great War, was mainly focused on preserving goods and money for the war effort. Civilian production shifted to war production, with raw materials being sent to beneficial industries at the time. Tax rates were increased to fund the war effort as well, up to 18% for households with an income of $50,000. After the war, Warren Harding, president at the time, greatly reduced federal spending and taxes. Federal spending decreased from $6.3B in 1920 to $3.2B in 1922, and taxes fell from $6.6B in 1920 to $4B in 1922. This gave the working classes more money to spend on all the new goods, brand names, and entertainment being released at this time, such as clothes, jewelry, Scotch tape, Welch's grape juice, amusement parks, and sports. These goods and entertainment venues were previously unavailable due to mass focus on the war effort: not a single dollar or bit of cotton could have been wasted. This great jump in consumerism helped to create a decade of economic prosperity in the US during the 1920s.
World War One was a disastrous conflict, and the European nations involved in the war had a difficult time dealing with the post war damage done to them. Countries like Great Britain repeatedly borrowed money (up to $10M/day) from the US to pay for their war materials, putting them in severe debt. Inflation was rampant among Europe due to debts to the US (Great Britain, etc) or having to pay extremely high reparations with money that didn't necessarily exist (Germany). This inflation caused the value of currency to dwindle and for standards of living to shrink in Europe. However, the US was better off than their rivals across the Atlantic, emerging as a creditor nation/financial superpower post-WW1 due to all the debts owed to them. The high demand for their goods from other countries also helped to boost the economy, providing many people with jobs (the unemployment rate sank as low as 1.4%) and helping industry to profit massively from all the mass-produced goods being bought. The US also invested large amounts of money and traded worldwide, taking advantage of the devalued currency and lack of prominent competition in Europe, which helped to bring in more revenue and further boost the US economy.
In what ways did the First World War help to create a decade of economic growth in the US?
Due to the shift from military production to civilian production once again and the heavily reduced taxes, American citizens were able to enjoy new products being released to them. Many of these new products used electricity to power them. These products included the vacuum cleaner, washing machine, refrigerator, freezer, radio, and telephone. The first four appliances greatly reduced the amount of time spent on household chores (cleaning, cooking, etc), leaving people with much more free time than in the past to do things at their leisure, such as attending lavish parties, dance halls, going to the movie theater, or watching sports like baseball. Automobiles also became readily available to most instead of just the rich, greatly cutting travel time for the working classes and opening a new market to them. Use of the radio and telephone became more widespread, with 12M people owning radios by the end of the '20s and 20M people having telephones in their homes by 1930. Once again, this large boost in consumerism helped to shape US economics for the better in the 1920s.