How Did The Vietnam War Affect The Economy

The Cold War is a proxy war that is said to be the root cause of a triumph of capitalism over communism. This geo-political conflict between the United States and The Soviet Union lasted a total of about fort-five years and ended with major economic impacts in both countries. During the Cold War, the Americans took it upon themselves to try and boost the United State’s economy. During President Reagan’s term, he went through with numerous tax cuts and deregulation in order to stimulate the economic growth. Many people believed, “due to the advantageous economic position that the US held in the beginning of the war and continued to have throughout that the US was destined to victory from the outset” (The U.S. Victory in the Cold War). During

As we mobilized troops in Vietnam, “After 1965 the Vietnam War buildup carried real defense purchases to a mobilization peak in 1968, up by more than one-third” (The Cold War Economy Higgs). Through evidence, it is seen that before the major wars during this time period, mobilization and military spending was relatively low and it was only when troops were required for war did the spending reach its peak. At these times, the American economy would have been on a down-turn and into a recession. This would mostly be due to the government’s focus on defense and the protection of the nation rather than focus on areas like interstate development. The Paris Peace Agreement, which drew back all United States troops from Vietnam, was the ultimate cause of the drop in military spending and a slight upward turn to the U.S. economy. Additionally, during the arms race with the Soviet Union, the Reagan administration showed that, “While defense spending doubled in the first Reagan administration, so also did the nation’s national debt…over US$700 billion.” Most of this was in large due to the defense spending during the 1980s. In addition, due to this rapid inflow of money into new defense mechanisms such as buying new weapons, many felt like the spending was not worth it. This is largely because previous presidents such as Carter and Nixon had also spent money on buying weapons and still had around the same number of weapons purchased as Reagan did (Mysteries of the Cold War-