Economic Status of the United States in 1950

"body">Per Capita Personal Income
IntroductionIn 1950 the Per Capita Personal Income was
Emerging victorious from World War II five yearspegged at $1,501.00. By 2006 this rose to about
earlier, the United States in 1950 was reaping the$36,600.00. Though marked by huge difference in
benefits of a growing economy - benefits thatamount, it can be noted that $1,501.00 in 1950
were actually derived out of the country'scould by more goods and services than the
participation in the War. The destruction and$36,600 in 2006 as illustrated by the CPI rates for
mayhem brought by the global conflict alsoboth years.
brought with it several positive contributions toConsumer Price Index and Inflation
the economy. Some would even argue that theWith 1967 as base year, CPI in 1950 was
country's participation in World War II actuallyregistered at 72.1 - meaning that a basket of
saved it from the Great Depression.goods and services bought in 1950 were 72.1
To understand the economic boom of the 1950spercent of the price of the same goods and
it is necessary to appreciate the positive impactsservices bought in 1967. By 2006, the CPI was at
that were borne out of World War II. The603.5. This meant that the same basket of goods
foundation for the economic expansion andand services bought in 1967 would cost 603.5
growth experienced in 1950 and several yearspercent more in 2006. Inflation rate in 1950 was
after that were laid during World War II.at a steady 1.09 percent. In 2006 the rate was at
To fund and support the country's war time3.24 percent.
efforts, it had to recruit millions of AmericanEmerging Industries
soldiers to be sent to the war front as well as to1950 saw the emergence of new industries that
be stationed at home. Factories had to be built towere anchored on new technologies. Among
produce war materiel - guns and ammunitions,these is the aerospace industry. The great
military transport, tanks, fighter planes andsuccess of the heavy bombers during the war
bombers, etc. To man the factories women andemphasized importance on innovation.
older people had to be recruited as most of theImprovements in engine design, metallurgy, and
able-bodied men were at war. WWII created jobsarms technology helped advance the industry as
and gave life to many industries and energized awell as improve manufacturing procedures.
nation. Among the industries that prospered duringThe onset of the Cold War ensured that the
and immediately after the war were theindustry was there to stay. At its peak, the
newspaper industry, the agriculture industry andindustry hired hundreds of thousands of workers
even Hollywood. Industries that producedin four major factories. The industry was also
transport and plant machineries also prospered.fueled by a $3 billion government spending.
Throughout the War, women, for the first time,Other industries that grew during this time were
were given the opportunity to work outside theirboosted by other industries. Take for instance the
homes and participate in nation building. Thehousing boom experienced after war. New homes
participation of the women in the labor forcemeant additional furniture and appliances as well as
started to increase during this time.new cars. The consumer-led growth likewise
The War also provided opportunities that wouldspread to other areas. The introduction of
later be manifested in the 1950s. Take fortelevision to the masses spurred the growth in
example many of America's products wentelectronics.
overseas - introducing themselves to newThere were also after effects in the growth of
markets.industries. As the demand for homes and cars
Many had actually feared that the end of the Warincreased, many Americans were lured out of
would lead the country back to depression. Withcentral cities to the suburbs. The construction of
production of military supplies coming to an end,better highways also contributed to these
this fear had its basis - for the entire economyphenomena.
was propped up by all that had to do with theFarmers though were facing tough times. As
global conflict.people left farm lands, lesser people were left
Fortunately, this was not the case. The victorybehind to do farm work. This led to a drop in the
relished by the nation brought about confidence inproductivity of the farm sector.
the government and the economy. The commonInnovations and the Transformation of Business
consumer best exhibited this confidence as theAt a personal level, 1950 saw the introduction of
strong consumer demand spurred economicthe first hand held T.V. remote control - a device
growth after the War.that would be seen as a necessity in many
Leading towards the 1950s, industries thathouseholds for years to come. Color TV also
experienced a surge in growth included theemerged thru the issuance of a license to CBS
automobile industry and the housing industry, andNetwork. Another innovation is the introduction of
new industries experienced fantastic births -the first credit card - Diners - also an item that
industries such as aviation and electronics.would come across as a necessity in modern
There was also another outcome of WWII thattimes.
contributed to post War growth - the Cold WarThe first pagers were also developed in 1950.
between U.S. and the U.S.S.R.In the business front, 1950 would usher in an era
Many of the military industries that sproutedmarked by consolidation of large companies.
during the war continued to do big business afterBusinesses would combine to create bigger,
it. As communist block emerged as a militarygreater businesses. Example, International
power in Europe, America had to arm itselfTelephone and Telegraph bought Sheraton Hotels,
against what it considered as a threat. HugeContinental Banking, Hartford Fire Insurance, Avis
investments were made in the defense of theRent-a-Car, and other companies.
country. Such investments meant jobs, factories,Notable Events and Personalities
huge spending - all contributed to the boom of theNotable events of 1950 included the following:
1950s.Start of the Korean War - influenced greatly by
The economic success of the country probablythe U.S. and USSR at opposite sides, North and
influenced its leaders to advocate the replicationSouth Korea would tangle in a three-year war
of an open economy at the international level. Thisthat highlighted the tension during Cold War
is best evidenced by the country's spearheadingregime.
the establishment of the International MonetaryDevelopment of the Hydrogen Bomb - raged by
Fund and the World Bank.the atomic bomb testing by USSR, the
Gross Domestic Product and Per Capita GDPgovernment pursued the development of a
In 1950, the country's GDP was at $293.8 Billionhydrogen bomb.
(in current dollars). At that time, Per Capita GDPSenator Joseph McCarthy - started the Red
was $9,573.00 - making the United States theScare in halls of the U.S. Senate - making
number one country world wide in this aspect. Byaccusations that the State Department was filled
1996, GDP was at $13.194 Trillion. Per Capita GDPwith Communists or their sympathizers. The
was at $43,800.00 - however, the countrySenator's actions led to the adoption of the term
ranked only at 10th place world wide in thisMcCarthyism - describing intense anti-Communists
respect.sentiments.
Post World War II scenario showed that too fewThis period coincided with and fueled the onset of
economies survive the war while a greatthe Cold War between America and the USSR.
majority, especially in Europe, was greatlyThousands of Americans were accused of being
affected. Many developments starting in the lateCommunists or sympathizers during this time -
1970s toward the early 2000s enabled otherAmericans in various sectors of the society.
countries to overtake the U.S. in terms of PerHistory would later judge these accusations as
Capita GDP.reckless and baseless. While Senator McCarthy
As Per Capita GDP is influenced by population,gained considerable media mileage at the start of
countries that had significant economic growthhis "campaigns," he would be later unmasked as a
coupled with low birth rate were able to surpassgrandstanding antic who had little or no evidence
the U.S. in this indicator. However, the U.S. remainsto back up his accusations. Many of the people
the most powerful economy in 2007 taking intoSenator McCarthy accused suffered greatly. Many
consideration other indicators.loss their jobs, had their careers ruined while
Employment and Unemploymentsome were even unjustly imprisoned.
In 1950, the civilian labor force was about 58Conclusion
million strong. Only 5.3 percent of the labor forceThe end of World War II led to the end of the
was unemployed. 41.6 million of the labor force atGreat Depression and the start of a long period
that time were males, while only 17.34 millionof economic expansion through the 1950s. It is
were females. By 1996, the labor force grew toquite ironical that the most destructive war in
about 142 million while unemployment rate as at 5history would contribute to the emergence of the
percent. 76 million were males while 66 millionstrongest and biggest economy in the world. The
were females in the labor force. In the 1950s, theconfidence on the economy was obviously
number of workers in the services sector caughtbrought about by the country's victory in the
up with workers in goods production industries.War. Tempered by strong collaboration between
The same time also saw the rise of white-collarthe government, businesses and the consumers,
jobs and the strengthening of labor unions.the U.S. emerged from the War a lot stronger
Awareness on labor rights was on a rise. Theand economically strengthened. Industrial
biggest impact experienced by the labor forceexpansion during wartime brought economic
was the increase in women's participation inimpetus that would be carried on even after
employment activities. Accordingly, women haveWWII. The fact that most of the major
literally poured into the labor force starting in 1950.economies were slow to recover from the after
By 1990, women's participation in the labor forceeffects of the conflict placed the United States at
would nearly double. On the other hand, men'sabsolute and relative advantage over both its allies
participation would drop over time.and its enemies.