During the Revolution, the Civil War and World War I, inflation ran well into double and at times even triple digits. During World War II, by contrast, inflation was much less of a problem, even though the Federal Reserve monetized (turned into money) 10% of the rapidly growing national debt by buying Treasury bonds en masse to keep their prices up (and their yields down). After jumping 10.66% in 1942, the price level increased only 6.13%, 1.73% and 2.27% during the war’s final three years.
One reason inflation remained relatively tame was due to the success of the government’s quantity rationing program. To lawfully purchase a rationed good, consumers had to pay the purchase price and present a valid coupon for it. Rationed goods included automobiles, bicycles, canned fish and milk, cheese, coffee, farm equipment, gasoline and other fuels, meats, processed foods, rubber and regular shoes, sugar, stoves, tires and typewriters.
Rationing does not work when incentives to trade illegally combine with lax enforcement. During the war, however, most people realized that a few years of modest want were better than a lifetime of fascism. So they played by the rules and made sure that others did too.
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“US Congress House Servicemen’s Federal Income Taxes Questions and Answers Explanatory of the Federal Income Tax Laws with Respect to Members of the Armed Forces of the US in World War II,” House Doc. 379, 1945.