Question

I need help pleaseee!

Answer 1

Answer:The effect of WWI on the US economy was considerable. There are two effects that the war had on the US economy: short term, and long term.

For the short term effect the US economy grew in the buildup to the war and during its prosecution. From 1915 the US made tons of loans to the UK to help them in their war effort. It is not a stretch to say that WWI was the major factor in contributing to the "Roaring 20s" when the US economy boomed. After the peace the economy dropped temporarily and this is most likely attributable to the stopping of war material production. However, at that point in the timeline the US was the only country that had not been completely devastated by the effects of the war. US companies were able to expand their reach around the world, and domestic consumption in the US increased, hence the name "The Roaring 20s." So the short term effect (I am defining short term effect as within one decade) was that the US economy grew a large amount due to their involvement in WWI.

The long term effect was that US involvement in the war lead directly to the Great Depression and WWII. The Treaty of Versailles led to a system where the US was cashing in its wartime loans to the UK, which in turn was using the wartime reparations it received from Germany to pay off the US. This system collapsed when the Germany economy succumbed to hyperinflation and died. That paired with Black Tuesday, which was driven by rampant stock speculation from tons of US citizens flush with cash led to the Great Depression. Since the world was still reeling from the effects of WWI when Germany fell, everything else fell apart. This event was directly attributable to WWI.

So in short there was a huge effect on the US economy in the short term which lead to the Roaring 20s, but the growth was short lived as it was built upon the same conditions that brought about the Great Depression.