The Green New Deal and Beyond
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Stan Cox. The Green New Deal and Beyond
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THE GREEN NEW DEAL AND BEYOND
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The fact that U.S. industries could ramp up production to a historically unprecedented output within months in support of urgent national goals has inspired present-day visions of a similar industrial mobilization to combat greenhouse warming. There has been less discussion of the deep adaptations that were required of the wartime economy. Overnight, a government that had struggled for a decade with an excess of production and a deficit of consumer buying power had to figure out how to start serving a population that had plenty of money to spend but now faced shortages of goods on which to spend it. The economy had gone from cash-limited to resource-limited. If nothing were done, Depression-era price deflation would flip into just-as-destructive hyperinflation. The federal government responded, tiptoeing into the murky waters of price controls. Under the Office of Price Administration, the process began in 1940 with voluntary campaigns, one commodity at a time, and by 1943 had escalated into a mandatory clampdown on prices throughout the economy.38
Enforcing ceilings on prices is a sure, direct way to stop inflation, but it doesn’t guarantee fair access. Suppressed prices boost the demand for goods but not the supply. And in the 1940s, supplies of goods were further limited by the diversion of workers and resources into the effort to win the war. The U.S. government was eventually forced into a second level of intervention to make sure that the entire population had access to an adequate supply of food, shelter, clothing, and other basic necessities.
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