How Did The Vietnam War Affect The Economy

Thanks to the rise of big business and the triumph of industry, in the early 1900s, the United States “wielded significant economic power in much of Central and Latin America.” Later on, the U.S. important role in the Great War and the Second World War let most Americans “accept their nation’s leading role in world affairs.” In my opinion, the U.S. involvement in World War II recovered and boosted its economy, whereas its intervention in the Vietnam War exerted a burden on its economy. This comparison shows that costs of maintaining global power weakened the U.S. economy. World War II, to a great extent, cured the Great Depression and led the United States to be a superpower in the world economy. As Delong mentioned, “Roosevelt’s concerns shifted to the …show more content…
intervention in the Vietnam War cause great damage to both Vietnamese and American people but also had a negative effect on the U.S. economy. According to Digital History, “an estimated 58,132 Americans died in Vietnam, more than 150,000 were wounded…the estimated cost of the war in Vietnam…was $176 billion.” The U.S. regarded the growth of Communism as a threat to its leading status. Thus, instead of helping Vietnamese people reunite their country, the United States wanted to exterminate the North Vietnamese regime. However, the Vietnam War slowed down the growth of the U.S. domestic economy due to large budget deficits. Despite the fact that President Johnson’s Great Society domestic programs managed to deal with most conflicts on civil rights, poverty, and social welfare, government spending both on military and society resulted in large budget deficits. In Macroeconomics, budget deficits would cause higher interest rate and then people would consume less and factories would invest less. In addition, high government spending also fueled inflation, which weakened domestic purchase power. Thus, the U.S. interventions abroad could also bring down its domestic economic