The Economic Impact of World War II
World War II was the deadliest military conflict in history. It lasted from 1939 to 1945 and involved 30 countries from every part of the globe. World War II killed around 70 million people or 4% of the world's population. Historians argue over the exact numbers, so most of the following figures are from "The Fallen of World War II." It's more than the deaths incurred for all wars since then combined.
- Within its six-year duration, WWII generated the highest human death toll of any war in recorded history, with a death toll of 70 million.
- Japan’s invasion of Manchuria in 1931 signaled the war, but WWII began in earnest when Hitler invaded Poland in 1939.
- Allied victory in WWII resulted in the U.S. dollar becoming the world’s reserve currency.
- It saw the creation of major global organizations such as the World Bank, the U.N., IMF, and NATO.
In Europe, the war killed 40 million people. Roughly half were soldiers and half civilians. For a more detailed breakdown consult the chart below:
The Soviet Union took the biggest hit with 20 million killed. Six million German soldiers directly killed 11 million soldiers and 7 million civilians. Almost 3.5 million Soviet prisoners of war died in German slave labor camps. German soldiers were ordered to shoot all Jews, communist leaders, and Soviet civilians and take their grain. More than 1 million residents starved to death during the two-year Siege of Leningrad.
Germany lost around 9 million. Around 5.3 million were soldiers, and 3.3 million were civilians. The Nazis killed 300,000 German civilians and Allied bombings killed 600,000.
Poland lost 5 million people or 16% of its total population. Of those, 2.7 million were Jews, and 240,000 were soldiers.
Yugoslavia lost 1 million people, of which 445,000 were soldiers. France lost 568,000 people, of which 218,000 were soldiers. The United Kingdom lost 60,000 civilians to German air raids and 384,000 soldiers. The United States lost 405,000 soldiers and about 2,000 civilians.
Other significant losses were endured by:
- Romania lost 833,000 total and 300,000 soldiers.
- Italy lost 457,000 total with 301,000 soldiers.
- Hungary lost 580,000 total with 300,000 soldiers.
The War killed 30 million in the Pacific. China lost 20 million people, 80% of whom were civilians.
The Japanese military killed around 300,000 Chinese in the 1937 Nanking Massacre. The atrocities fuel continuing antagonism. China killed 500,000 of its own civilians when leaders opened a dam to stop the Japanese, causing the 1938 Yellow River Flood.
Japanese war crimes caused 6 million deaths in China, Japan, Korea, Indochina, and the Philippines. This included the slaughter of civilians in villages, slave labor in Korea and China, and the use of human experiments to develop biological weapons. In addition, up to 400,000 "comfort women" were forced into sexual slavery. Conditions were so brutal that 90% of them had died by the end of the war.
Indonesia lost 4 million people due to starvation and forced labor during its occupation by Japan.
India lost 3 million, but only 87,000 soldiers. Japan cut off rice from Burma at the same time local crops failed. Great Britain had been diverting food from India to the war front, worsening mass starvation during the Bengal Famine.
Japan lost 2 million soldiers. Up to 1 million civilians died in Allied firebombing raids and two nuclear attacks on Hiroshima and Nagasaki.
The war was fought between the Allies and the Axis powers. The Soviet Union was initially an Axis power, then switched in 1941 to join the Allies when Germany invaded it.
The Allied leaders were France, Great Britain, and the United States. The Allies also included China and 50 other combatants.
The Axis leaders were Germany, Italy, and Japan. The Axis combatants also included Bulgaria, Hungary, Romania, Thailand, and Yugoslavia. Most of these countries only joined the Axis after their military defeat and occupation. Finland briefly allied with Germany to regain lost territory from the Soviet Union.
There were four major causes of World War II.
- The biggest cause was World War I and its aftereffect. The Treaty of Versailles imposed harsh terms on Germany. The German government printed money to meet its high reparation payments and created hyperinflation. As Germans lost buying power, they looked for a solution. Adolf Hitler was a veteran. He blamed Jews for Germany's defeat. Germans welcomed his promise of a return to power. In 1940, he forced the French to surrender in the same railroad car used for the Treaty of Versailles.
- A second major cause was the Great Depression. It reduced global trade by 25%. In Germany, unemployment reached 30%. Communism looked attractive. To block this threat from the east, the German government supported the Nazis. But Hitler betrayed them and assumed total power as dictator.
- The third cause was nationalism in Italy, Germany, and Japan. The harsh economic conditions made people turn to fascist leaders. They used nationalism to override individuals' self-interest to achieve their country's return to former glory. They advocated militarism to overcome other nations and take their natural resources.
- Protectionism was a fourth major cause. Japan, an island nation, required oil and food imports to feed its growing population. The 1930 Smoot-Hawley tariff and other forms of protectionism forced Japan to consider military expansion. In 1931, Japan invaded Manchuria to acquire the land and other resources it needed. In 1937, it invaded China and attacked a U.S. gunboat in the process. The U.S. oil embargo in July 1941 led to the Pearl Harbor attack.
How the War Began
In 1931, Japan invaded Manchuria. In 1936, it signed the Anti-Comintern Pact with Germany and later, Italy.
In 1939, Germany invaded Poland. Great Britain and France declared war on Germany two days later. The Soviet Union attacked Poland from the east. It then conquered Estonia, Latvia, Lithuania, and Finland. German submarines attacked ships bringing supplies to Great Britain. U.S. President Franklin D. Roosevelt started gearing up for war.
In 1940, Germany invaded Belgium, the Netherlands, and France. By the end of the year, one-third of Europe was under the control of the Axis powers. Japan invaded Indochina.
In 1941, Hungary, Romania, and Bulgaria joined the Axis. Germany invaded Yugoslavia, Greece, and then the Soviet Union. Japan attacked Pearl Harbor and the United States entered the war.
The war's early successes raised the Nazis' popularity with the German people. The war also distracted them from the Nazi extermination of Jews in Poland and other conquered regions. According to the Nazis, the war was being fought against Communists and Jews who were one and the same.
Around 80% of the Jews in German-occupied Europe were killed. Of the 6 million Jews, 2.7 million were Polish, and 700,000 were Soviets. The rest came from Hungary, Romania, Germany, Lithuania, Netherlands, Czechoslovakia, France, Latvia, Slovakia, Greece, Yugoslavia, Austria, Belgium, Italy, Estonia, Luxembourg, Norway, and Denmark.
Hitler's war against the Jews began shortly after he took power. On April 1, 1933, he ordered a boycott of Jewish businesses. Discrimination against Jews continued until, by 1935, the Nurnberg Laws reduced Jews to subjects of the state, stripping them of their German citizenship. On November 9, 1938, 30,000 Jews were sent to concentration camps on Kristallnacht. By 1939, Jewish refugees found few countries other than Palestine would accept their growing numbers.
As Germany invaded Poland, Austria, and other eastern countries, the Nazis began executing Jews, Catholics, Roma, and other "undesirables." They forced Jews into ghettos where disease and starvation took their toll. In 1941, the Nazis began the "final solution" by murdering Jews in death camps.
The Einsatzgruppen accompanied troops to shoot 1.4 million undesirable civilians in the field. At Babi Yar in Ukraine, they shot 33,771 Jews in two days, dumping their bodies into a ravine. In total, they murdered 100,000 Roma, Jews, and Communists.
In 1942, the Nazis built extermination camps in Poland. They deported Jews from occupied territories on trains to the camps. Around 2.7 million people died in the Auschwitz, Treblinka, Belzec, Sobibor, and Chelmno camps.
In total, 6 million Jews died. Another 1.8 million non-Jewish Polish civilians and 312,000 Serbians were killed. The Nazis also eliminated 250,000 people with disabilities, 220,000 Roma, 70,000 criminals and homosexuals, and 1,900 Jehovah's Witnesses.
In 1938, there were 9.5 million Jews in Europe out of 16.6 million worldwide. By 1945, that number had been reduced to 3.8 million in Europe out of 11 million globally. When the war ended, there were 900,000 survivors of Nazi rule including an estimated 100,000 liberated from concentration camps.
How the War Ended
In 1941, Hitler betrayed Stalin, sending 3 million Axis troops into the Soviet Union. Germany wanted the land for its own people and, so, slaughtered as many civilians as possible. It also wanted to eliminate the communist threat, which it blamed on Jews. Operation Barbarossa was the largest military attack in history. The front stretched from the Baltic Sea in the north to the Black Sea in the south.
But Hitler underestimated his former ally's strength and the Russian winter. In 1942, the Soviets ended the Battle of Stalingrad. It was the longest and bloodiest battle in modern warfare. Four million people died, half of whom were civilians. On January 31, 1943, the Germans there surrendered.
In 1942, U.S. forces beat the Japanese in the Battle of Midway and the Battle of Guadalcanal, Philippines.
In 1943, Allied forces defeated the Italians and Germans, and Mussolini's government collapsed. Italy surrendered on September 3, 1943.
In 1944, the Allies gained the upper hand in the Pacific. Once they gained the Mariana Islands, they were close enough to bomb the Japanese mainland.
On June 6, 1944, the Allies invaded Western Europe on D-Day. As the Germans retreated from the Eastern front, Soviet forces retook Poland, Czechoslovakia, Hungary, and Romania. In January 1945, Allies won the Battle of the Bulge, which had been Hitler's last offensive.
In April 1945, Soviet troops retook Vienna and then Berlin. Guerilla fighters killed Italian dictator Benito Mussolini, forcing German troops in Italy to surrender. On April 30, Adolf Hitler committed suicide in Berlin. Germany surrendered on May 8, 1945.
President Harry Truman ordered bombs to be dropped on Hiroshima on August 6 and Nagasaki on August 9. Around a third to two-thirds of the 330,000 Hiroshima residents and 80,000 of the 250,000 Nagasaki residents died by December 1945. There were 3,000 U.S. citizens in Hiroshima on that day.
Deaths occurred from the brute force, burns, radiation sickness, and cancer. In 2007, at least 226,000 survivors of the bombing were still alive in Japan. Most of these "Hibakusha" suffer from radiation-related illness.
Truman thought the atom bomb was necessary to force Japan's surrender. He wanted to avoid further U.S losses like those sustained at the Battle for Iwo Jima. Others thought atom bombs weren't needed. Japan had signaled it would 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. Japan was also concerned about fighting the Soviet Union to its north.
Japan surrendered on August 14, 1945. The war officially ended on September 2, 1945, when Japanese leaders signed the surrender document.
Who Won World War II?
The Allied nations won. Of those, the United States and the Soviet Union gained the most.
The war solidified the role of the U.S. superpower that had begun in World War I. The 1944 Bretton Woods agreement established a new global monetary system. It replaced the gold standard with the U.S. dollar as the global currency. It established America as the dominant power since it was the only country with the ability to print dollars.
The agreement also created the World Bank to help emerging market countries to reduce poverty. The International Monetary Fund provides technical assistance and short-term loans to prevent financial crises in member countries.
In 1945, the Allies created the United Nations to prevent another world war. In 1949, the North Atlantic Treaty Organization was founded to protect European nations from threats by communist countries.
The Soviet Union took over the eastern European countries it had liberated from the Germans. The war strengthened Joseph Stalin's rule. The German annihilation of Soviet people created a "never again" mentality that led to the Cold War.
With other countries focused on rebuilding, America and the Soviet Union engaged in the Cold War power struggle. The nuclear bomb set up the necessity of detente to prevent global annihilation.
Other Impacts of World War II
Since then, developed countries haven't fought each other. Most wars have been civil wars, often assisted by foreign countries.
Allied forces controlled the countries and territories of the Axis powers. Millions of Germans and Japanese were forced out of the territories they lived in and sent back "home." The victors dismantled their former enemies' ability to make war by dismantling factories.
East and West Germany were divided, as was Berlin. The U.N. Partition Plan for Palestine led to Israel's independence in 1948. President Truman said it was a matter of justice for the Jewish people.
In 1941, Germany and Italy split up Yugoslavia into Croatia, Bosnia, and Herzegovina.
North and South Korea were divided, which led to the Korean War. The war led to a four-year civil war in China that allowed communism to take power.
The Bengal Famine led to India's uprising and independence from Great Britain. Japan's occupation of the Dutch East Indies led to the formation of an independent Indonesia.
Impact on U.S. Economy
U.S. war spending helped add $236 billion to the debt. It was a 1,048% increase, the largest percentage increase to the debt of any president.
A review of U.S. gross domestic product growth by year reveals that the economy grew at least 8% annually between 1939 and 1944. Between 1941 and 1943, it grew more than 17% a year.
One reason U.S. production grew so fast was that it had been slack during the Great Depression. Underutilized manufacturing, shipbuilding, and auto factories were able to gear up for full production.
To pay for it, the government expanded the income tax and introduced mandatory withholdings from paychecks. In 1939, 4 million Americans paid federal taxes. That rose to 43 million by 1945.
The war turned the United States into a major military power. Before the war started, the U.S. Army only had 174,000 troops. That was 19th in the world and smaller than Portugal's. Army Chief of Staff General George C. Marshall reorganized the army into a strong fighting force. In December 1941, it had grown to 1.8 million men. By 1945, it had 8.25 million.
In 1947, the Truman Doctrine pledged the United States to assist any democracy attacked by authoritarian forces. It shifted U.S. foreign policy from isolationist to the global policeman. The Marshall Plan pledged $12 billion in food, machinery, and foreign direct investment to rebuild Europe. The National Security Act consolidated the Army and Navy into the Defense Department. It created the Air Force, the National Security Council, and the CIA. In 1948, the United States airlifted food and fuel in West Berlin after the Soviets blockaded it.
In 1949, the Fair Deal called for national health insurance 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.
The Immigration and Nationality Act of 1952 continued quotas for immigrants based upon country of origin. It had lower quotas for Asians, a vestige of the racism prevalent during the war. Between 1942 and 1945, the federal government relocated 117,000 Americans of Japanese ancestry into internment camps. The Act prioritized family reunification and desired skills.
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