How did World War 2 help end the Great Depression?
The US government’s reaction to its entry into W.W.II was to institute massive deficit spending, and the conscription of all able bodied young men for the war effort, thus creating a full-employment economy which was the immediate end to the Great Depression. A belief existed that another depression might occur upon the return of the young men to the labor force so a comprehensive veteran’s benefit package was legislated. The logistics of the ensuing peace created a natural US trade advantage which allowed for the unfettered repayment of the war generated deficit. The liberal veteran’s educational and housing benefit resulted in increased productivity and a construction boom. These forces combined to forestall any otherwise feared return to the depression.
