Chapter 39 ~ The Cold War Begins ~ 1945 – 1952
I. Postwar Economic Anxieties
The Americans cheered the end of World War II in 1945, but many worried that with the war over, the U.S.
would sink back into another Great Depression.
Upon war’s end, inflation shot up with the release of price controls while the gross national product sank, and
labor strikes swept the nation.
To get even with labor, Congress passed the Taft-Hartley Act, which outlawed “closed” shops (closed to non-
union members), made unions liable for damages that resulted from jurisdictional disputes among themselves, and
required that union leaders take non-communist oaths. Opposite of the Wagner Act of the New Deal, this new act
was a strike against labor unions.
iii. Labor tried to organize in the South and West with “Operation Dixie,” but this proved frustrating and
iv. To forestall an economic downturn, the Democratic administration sold war factories and other government
installations to private businesses cheaply. Congress passed the Employment Act of 1946, which made it
government policy to “promote maximum employment, production, and purchasing power,” and created the
Council of Economic Advisors to provide the president with data to make that policy a reality.
It also passed the Servicemen’s Readjustment Act of 1944, better known as the GI Bill of Rights, which
allowed all servicemen to have free college education once they returned from the war.
II. The Long Economic Boom, 1950-1970
Then, in the late 1940s and into the 1960s, the economy began to boom tremendously, and folks who had felt the
sting of the Great Depression now wanted to bathe in the new prosperity.
The middle class more than doubled while people now wanted two cars in every garage; over 90% of
American families owned a television.
Women also reaped the benefits of the postwar economy, growing in the American work force while giving up
their former roles as housewives.
iii. However, much of the prosperity of the 50s and 60s rested on colossal military projects.
Massive appropriations for the Korean War, defense spending, industries like aerospace, plastics, and
electronics, and research and development all were such projects.
iv. Even though this new affluence did not touch everyone, it did touch many.
Cheap energy paralleled the popularity of automobiles, and spidery grids of electrical cables carried the power of
oil, gas, coal, and falling water into homes and factories alike.
vi. Workers upped their output tremendously, as did farmers, due to new technology in fertilizers, etc. In fact, the
farming population shrank while production soared.
III. The Smiling Sunbelt
With so many people on the move, families were being strained. Combined with the baby boom, this explained
the success of Dr. Benjamin Spock’s The Common Sense Book of Baby and Child Care.