Appendices - Hirohito's War
ECONOMICS OF THE PACIFIC WAR – THE NEW DEAL MOBILIZED
Conclusion: It is often written that Japan had no possibility of winning a war against a vastly larger US economy. Indeed the US economy in 1941 was some nine times larger than that of Japan. This was not the whole story however. Firstly, in 1905 Japan had defeated an Imperial Russia that was a significantly larger economy. Secondly in 1941 Japan was not pitted against Japan alone. In aggregate the Allied powers had double the GNP of the Axis powers – a significant but not overwhelming advantage. Lastly at the end of 1941 the US economy was not fully geared for war – indeed, as has been noted in Chapter 4, the US Army was scrambling to make up for twenty years of isolationist neglect – its main ally Great Britain likewise.
In terms of preparedness Japan stood at a significant advantage. However, Japan too had problems. Its economy was operating at full capacity to provide for the full-scale war in which it had been engaged in China since 1937. A squeeze on Japan’s domestic consumption was already apparent. Critically, Japan did not have the wherewithal to sustain a long war. Even internal estimates by the Institute of Total War Studies concluded that Japan could only sustain a war with China for a further five years; a war with the West in addition was economically sustainable for just two years.
Ultimately Japan’s failure to execute a war strategy that would bring the United States to the negotiating table within two years, meant that Japan’s economy was stretched to breaking point after 1943. It was only the sacrifice of the living standards of the Japanese on the home front that enabled the war effort to stutter on. All the time the US economy was getting stronger while the Axis economies were being dismantled. From a 2:1 GNP advantage in 1941, the Allied powers established a 4:1 advantage in 1944 and a 5:1 advantage in 1945. From this point American victory was inevitable as long as Americans sustained their will to fight – as indeed they did.