The Gulf of Tonkin Resolution <span> authorized the president to take "all necessary measures to repel armed attack" in Vietnam.
This resolution had significant consequences for the Vietnam War and beyond that time. In regard to the Vietnam War, it provided the justification for the president, Lyndon Johnson, to escalate US involvement in the war and magnify the number of US troops there by hundreds of thousands. In US foreign policy in general, it represented an increase of the power of the Commander in Chief (the president) to deploy troops without getting formal approval in advance from Congress.
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The first and most important point is that the Civil War was expensive. In 1860 the U.S. national debt was $65 million. To put that in perspective, the national debt in 1789, the year George Washington took office, was $77 million. In other words, from 1789 to 1860, the United States spanned the continent, fought two major wars, and began its industrial growth—all the while reducing its national debt.We had limited government, few federal expenses, and low taxes. In 1860, on the eve of war, almost all federal revenue derived from the tariff. We had no income tax, no estate tax, and no excise taxes. Even the hated whiskey tax was gone. We had seemingly fulfilled Thomas Jefferson’s vision: “What farmer, what mechanic, what laborer ever sees a tax-gatherer of the United States?”Four years of civil war changed all that forever. In 1865 the national debt stood at $2.7 billion. Just the annual interest on that debt was more than twice our entire national budget in 1860. In fact, that Civil War debt is almost twice what the federal government spent before 1860.What’s worse, Jefferson’s vision had become a nightmare. The United States had a progressive income tax, an estate tax, and excise taxes as well. The revenue department had greatly expanded, and tax-gatherers were a big part of the federal bureaucracy.
Furthermore, our currency was tainted. The Union government had issued more than $430 million in paper money (greenbacks) and demanded it be legal tender for all debts. No gold backed the notes.The military side of the Civil War ended when Generals Ulysses S. Grant and Robert E. Lee shook hands at Appomattox Court House. But the economic side of the war endured for generations. The change is seen in the annual budgets before and after the war. The 1860 federal budget was $63 million, but after the war, annual budgets regularly exceeded $300 million. Why the sharp increase?
The correct answer is the first option: one consequence of stagflation is that the economy drastically slows down as money loses its buying power.
Stagflation is known as an economic problem that occurs when there are rising inflation and unemployment which causes money to lose its original value. Thus, spending declines and loses its buying power too.
One of the main reasons why the Persian Gulf War is cited by some as an event that fueled Islamic extremism is because it involved a lot of military intervention from the West (specifically the US) that led to many Arab deaths.
