It renewed the morale of the American public, but it convinced potential foreign partners, such as France, that American could win the war, and that it might be in their best interests to send aid
America should be a melting pot because with more and more ethnic entities, a lot of people have learned to be open minded, and have learned to respect and learn about other cultures. It also provides workers to boost the American economy. Illegal immigrants or not.
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This policy was called "containment" - the idea was to contain communism from spreading to new countries without trying to actively challenge the communist system in the countries that already had it.
This policy lead to some proxy wars, in which the US fought the Soviet Union for the free countries.