The Economy of Total War
The Economy of Total War: How the Two World Wars Shattered the 19th-Century Financial System Introduction: World War I (1914-1918) and World War II (1939-1945) shattered more than just lives and armies; they shattered the global economic order of the 19th century. These were not traditional wars but "total wars" that subjugated every aspect of the economy to the war effort, permanently reshaping the map of global financial power. State Dominance and the Decline of the Free Market: The most dramatic shift was the abandonment of the previously dominant "laissez-faire" principles. To meet the demands of war, governments intervened in their economies on an unprecedented scale. They nationalized key industries, imposed rationing on essential goods, and directed all production towards military manufacturing. The war proved that the state could, when necessary, be the supreme economic planner. Financing the War: Debt, Inflation,...