Title: How did the Vietnam War affect America? - The Vietnam War
Headings: How did the Vietnam War affect America?
How did the Vietnam War affect America?
Damage the Economy
Spur Policy Changes
The Right to Vote at Age 18
The End of the Draft
An All-Volunteer Force
Mistrust the Government
“Vietnam Syndrome”
No More “Quagmires”
The Continuing Effect
Sharing is Caring
Show us some Love

Content: Damage the Economy
The Vietnam War damaged the U.S. economy severely. The U.S. had poured some $168 billion into the war, but the real cost of the conflict was its impact on the economy. After a few truly good years during 1962 – 1965 when there was low inflation, almost full employment and a favorable balance of trade, President Lyndon B. Johnson, who succeeded President Kennedy after his assassination in 1963, declared a “War on Poverty” through his “Great Society” programs while escalating the war in Vietnam at the same time. However, his decision to finance both “guns and butter” – a major war and the Great Society simultaneously, without a significant increase in taxes unleashed an acceleration of inflation peaking at a runaway double-digit in mid 1970s. Not until 1969 did President Johnson decided to introduce a 10% income tax surcharge, which is considered by many economists “too little and too late” and in turn also slowed down the economy. It’s worth mentioning that Congress would not allow that “surcharge” to be implemented until President Johnson agreed to cut $6 billion from domestic spending on Great Society programs. Despite their relative success, Johnson could have undoubtedly spent more on these programs had he not had to pay for the war abroad, which Martin Luther King, Jr. had referred to as a “America’s tragic distraction” at the beginning of Johnson administration. Moreover, huge spending on the war in Vietnam led to an increasingly unfavorable balance of trade, which contributed to an international monetary crisis and threat to U.S. gold reserves in 1967-68. That threat was seen as convincing evidence that the U.S. could no longer afford the war. Inflation fueled by the escalation of the Vietnam and later Yom Kippur War also increased food prices and contributed to the oil price hike in 1973, which then led to inflationary expectations.