I think that now with the financial crisis at hand a serious question has arised in my head. Several months ago I saw Flags of our fathers and if the film is correct the US was on the bank of bankruptcy and desperatly needed mony from war bonds to continue the fight. Now I know about special war budgets and high taxes as well as war bonds, but how much exactly was spent on the war and where did the money come from and of course how did the government pay all that debt?

 

Finding sources is hard on this issue but I would appreciate some links or books.

 

Thank you

 

AL-Jassas

 

In totalitarian societies the first becomes somewhat immaterial, since it only means printing money that people are forced to accept. It's somewhat more complicated in democratic societies, though a wartime command economy has much in common with totalitartian regimes, including, e.g. forcing price controls and rationing.

 

How foreign countries are paid off is different, because you need either assets abroad to sell or as collateral for loans, which Britain had plenty of at least in the beginning, which was one of its big advantages as against Germany, which despite Schacht's best efforts had very few assets abroad, and relied on getting other countries to accept German paper.

 

It's a biggish subject however, and offhand I can't think of a good source.