Economic Effects of World War I on the United States

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Economic Effects of World War I on the United States


During the early nineteenth century most of Europe and the United States entered the First World War. However, when war first broke out the United States refused to enter the war and President Wilson was determined to remain a neutral country. Although the United States wished to remain neutral, they still continued to trade with warring nations, which ultimately caused them to join the war. If the United States had stayed out of the war completely and remained isolated, then the nation’s economy would spiral into a state of depression. Because of the illegal British blockade on Germany’s water boarder, the German U-boats and the Zimmerman Telegram, the United States was forced to enter World War I in order to protect its economic interests abroad and maintain its economy. By the end of World War I the economy and political position of the United States in the world had been changed significantly because of the exponential increase in trade. There was a new world order in which the United States was sitting on the top of the world, being the leader in trade, economy and industry.

Despite the United States’ numerous attempts to remain neutral it still decided to join World War I in the year 1917. Upon learning this, a common question is; why did America enter the war. One of the main reasons for the United States entering the war is because of the constant attack from German U-boats. After Great Britain had put up the illegal blockade around Germany, Germany was lacking desperately needed supplies. Although the United States were free to trade with any nation, the British would not allow even neutral ships in Germany’s ports. Therefore in order to keep the British from trading and getting more supplies, the German’s used the U-boat, a submarine, to attack unsuspecting enemy ships. Eventually Germany attacked neutral and enemy ships alike because Great Britain had begun using neutral flags to avoid getting attacked. Germany violates the rules of war by not signaling to the enemy ships that they would be attacked. There is supposed to be a warning so that the crew and passengers have time to get to safety, however if the U-boats had surfaced to the surface of the waters and told their enemies they would be attacked then the U-boats would not have been so effective, as a main reason for them being so terrifying is that they had the element of surprise and could escape without ships even know what had hit them. Although of these actions by Germany violated the rules of war, and did the Great Britain’s blockade, unlike the British, Germany was a hostile threat to the United States and needed to be stopped. Unfortunately these U-boats were not the only problem America had with Germany.

Another main cause of the United States entering World War I was the Zimmerman Telegram. The United States and Germany were not on good terms after the sinking of the neutral American ships, such as the Lusitania and because Germany refused to stop attacking merchant ships this relationship did not get any better. In the year 1917 the United States intercepted a telegram from Germany to Mexico. After it was decoded the United States found out that Germany was planning to become allies with Mexico and in return for Mexico’s assistance, Germany would help Mexico take back territory lost to the United States. Infuriated, President Wilson and Congress decided, in order to protect the nation’s pride and economical and political interest abroad, to enter the war on April 6, 1917. With events such as the Zimmerman Telegram and the German U-boats, which seriously affected trade, people wonder if it was possible to avoid World War I.

World War I could have been easily avoided simply by ending all foreign affairs with warring nations, however avoiding the war would have been much less beneficial than being involved. If the United States had decided to be completely...
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