President Harry Truman's Economic Policies
How Truman Made America a Global Leader
Harry S. Truman was the 33rd U.S. president, serving from 1945 to 1953, during World War II and the Korean War. During his tenure, he took America from isolationism to global leadership. Despite his unpopularity at the time, Truman won a surprise second term and has cemented a legacy among U.S. presidents.
World War II
Truman took office on April 12, 1945, after President Franklin D. Roosevelt died. He had been FDR's vice president for 82 days. Since they hadn't spent much time together, Truman was shocked by the secret preparations for the atomic bomb. He was also unaware of serious conflicts with America's ally, the Soviet Union. He later said, "I felt like the moon, the stars, and all the planets had fallen on me.”
Barely a month later, Germany surrendered on May 7, 1945. But, despite heavy losses, Japan continued World War II in the Pacific. Truman forced Japan's surrender when he dropped atomic bombs on Hiroshima on August 6 and Nagasaki on August 9. Around 90,000 to 120,000 of Hiroshima's 330,000 residents and 60,000 to 80,000 of the 250,000 Nagasaki residents died by the end of that year. There were also 3,000 U.S. citizens in Hiroshima on that day.
Deaths occurred from the bomb's brute force, burns, radiation sickness, and cancer. In 2007, there were at least 226,000 living survivors of the bombing. Most of these "Hibakusha" suffered from radiation-related illnesses.
Critics thought the bombing was unnecessary. Japan had shown signs it was ready to surrender if it could keep its emperor. The Air Force had bombed Tokyo and most other major industrial cities. The Navy had blockaded Japan's imports of oil and other vital materials. Truman's Chief of Staff, William Leahy, wrote, "By the beginning of September, Japan was almost completely defeated through a practically complete sea and air blockade." Japan was also concerned about fighting the Soviet Union to its north.
But Truman believed the atom bomb was necessary. He wanted to avoid further U.S. losses than what they had already sustained. Japan surrendered on August 15, 1945. The war officially ended on September 2, 1945, when Japanese leaders signed the surrender document.
After the war, Truman continued to expand American influence in Europe. In 1945, he supported the formation of the United Nations. In 1947, he outlined the Truman Doctrine to contain the rising threat of communism. It helped to launch the Cold War.
Great Britain had withdrawn its support for Greece in its fight against communist forces. Truman believed the Russians were behind the communist movements in Greece and Turkey. He didn't want the Soviets to take over any more countries that were critical to U.S. interests. Truman thought Soviet control of Greece and Turkey would lead to destabilization in West Asia.
The Truman Doctrine promised that the United States would assist any democracy attacked by authoritarian forces. This shifted U.S. foreign policy from isolationism to a global defender of democracies. It laid the philosophical framework that led to today's $700 billion military budget.
The 1947 National Security Act consolidated the Army and Navy into the Defense Department. It also created the Air Force, the National Security Council, and the CIA. Truman desegregated the military with a 1948 executive order. His commitment to civil rights made many Southerners leave the Democratic Party.
Truman supported Secretary of State George Marshall's plan to rebuild war-ravaged Europe. The Marshall Plan pledged $12 billion in food, machinery, and foreign direct investment. It would defend Western Europe from the spread of communism. and create a market for U.S. exports. The plan laid the groundwork for the formation of NATO in 1949.
At home, Truman vetoed the Taft-Hartley Act of 1947 because it weakened unions. It also required union leaders to swear they were not communists. Taft-Hartley allowed the president to stop strikes if they endangered national safety. President Ronald Reagan later used the act to stop an air traffic controllers strike and break union power.
In 1948, Truman airlifted food and fuel in West Berlin after the Soviets blockaded the city between June 24, 1948, and May 12, 1949. He recognized the country of Israel after it declared statehood in May 1948, stating that it was a matter of justice for the Jewish people.
On January 5, 1949, Truman outlined the Fair Deal in his State of the Union. It called for universal health care and raising the minimum wage. It also proposed the Fair Employment Practices Act to make illegal any religious and racial discrimination in hiring. Congress rejected national health insurance but passed the rest of the Fair Deal.
North Korea invaded South Korea in June 1950, and Truman announced that the U.S. would come to South Korea's aid just a few weeks later. General MacArthur led the U.N. forces that pushed North Korea back to the 38th parallel. That border held when the ceasefire was negotiated in 1953 during President Dwight Eisenhower's administration.
Truman vetoed the Immigration and Nationality Act of 1952 because it continued quotas for immigrants based upon country of origin. He felt that the act ended the exclusion of immigrants from Asia but continued to discriminate.
Truman and the Debt
Truman only added $7 billion to the nation's $259 billion debt. This was a 3% increase from over FDR’s last budget for fiscal year 1945.
Even though he battled two recessions, Truman did not end them with government spending because he didn't believe in Keynesian economic theory. In fact, Truman said, “Nobody can ever convince me that Government can spend a dollar that it’s not got.” By way of explanation, he added, “I’m just a country boy.”
When he took office in 1945, Truman received a $75,000 salary. It would be worth almost $1.1 million today, according to the Bureau of Labor Statistics. In 1949, Congress gave him a raise to $100,000.
Harry S. Truman's middle name is actually the letter "S." His parents could not decide whether they should name him after Anderson Shipp Truman or Solomon Young. As a compromise, they settled on S.
Truman's Early Years
Harry Truman grew up in Independence, Missouri, where he prospered for 12 years as a farmer. He served in World War I. After his return, he married and opened a men's hat store. He never did very well in business. In fact, after he left the presidency, he struggled financially. Congress passed the Former Presidents Act of 1958 to provide for him. Since then, every president receives a pension and expenses for life.
In 1934, Truman became a senator. During World War II, he led an investigative committee run by the Senate to reduce waste and corruption. He saved $15 billion.
Truman could have been only the second president in history to run for a third term. After FDR served for more than three, Congress passed the 22nd Amendment of 1951 to limit presidents to two terms. That law didn't apply to Truman because his first term was a continuation of Roosevelt's fourth. Truman decided not to run for a third term, however, perhaps because he realized the Korean War and some corruption scandals made him very unpopular.
He and his wife Bess retired to Independence, Missouri, where he jokingly referred to himself as "Mr. Citizen." He wrote three volumes of his memoirs: Year of Decisions, Years of Trial and Hope, and Mr. Citizen. Truman died of organ failure the day after Christmas in 1972, at the age of 88.