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Mobilizing the Economy:
America's economy performed astonishing feats during World War II. Manufacturers retooled their plants to produce war goods. But this alone was not enough. Soon huge new factories, built with government and private funds, appeared around the nation. Millions of new jobs were created and millions of Americans moved to new communities to fill them. Annual economic production, as measured by the Gross National Product (GNP), more than doubled, rising from $99.7 billion in 1940 to nearly $212 billion in 1945.
War production was fueled by government contracts. During the war federal spending soared and powerful new government agencies were created to direct the allocation of the nation's resources.
Government Spending Soars:
Federal military spending rose dramatically after 1941. Higher taxes and bond sales helped pay for war production, but the government still ran huge budget deficits. The national debt increased 500 percent, jumping from $48.9 billion in 1941 to $258 billion by 1945.
Below: Civilian employment in the federal government more than tripled during the war. In Washington, DC, temporary federal offices were built on the Mall. |