henretta8e

Quiz for America Compared: War Debt: Britain and the United States, 1830–1900

Question

1. The text explains that, after rising to 27 percent of the gross domestic product (GDP) in 1865 as a result of the Civil War, the national debt decreased quickly after that time due to tariff revenue. What other factor contributed to the rapid decrease of the national debt as a percentage of the GDP between 1880 and 1900?

A rapid increase in the GDP due to industrialization

War reparations paid to the U.S. government by the former Confederacy

The U.S. government’s commitment to isolationism after the Civil War

Major economic inflation due to the nation’s growing dependence on imported goods

Correct. The answer is a. The national debt as a percentage of the GDP of the United States shrank rapidly after the Civil War in part because rapid industrialization increased the GDP dramatically during the period between 1880 and 1900. If the GDP of the United States had remained stagnant, the national debt would not have decreased so rapidly.

Incorrect. The answer is a. The national debt as a percentage of the GDP of the United States shrank rapidly after the Civil War in part because rapid industrialization increased the GDP dramatically during the period between 1880 and 1900. If the GDP of the United States had remained stagnant, the national debt would not have decreased so rapidly.

Question

2. Why did Britain’s national debt continue to shrink over the course of the nineteenth century while that of the United States never again reached the low level of the pre-1860 period?

The United States instituted increasing numbers of social programs while Britain did not.

Britain benefitted from high tariff revenues during this time, but the U.S. eliminated tariffs.

Britain had already established its empire by the 1850s, but the United States began to expand its international reach after that time.

The United States refused to raise tax rates for the wealthy, whereas Britain taxed its wealthy industrialists at increasingly high levels.

Correct. The answer is c. By the middle of the nineteenth century, Britain had already established a large and powerful empire, and after that time, it maintained and benefitted from that empire without the need to fight more expensive wars. The United States, on the other hand, did not fight any lengthy wars between the American Revolution and 1860 and kept its national debt extremely low during that time. After the Civil War, however, the United States grew as an international power and expanded its geographical reach, which required new levels of spending and a level of national debt that was unprecedented before 1860.

Incorrect. The answer is c. By the middle of the nineteenth century, Britain had already established a large and powerful empire, and after that time, it maintained and benefitted from that empire without the need to fight more expensive wars. The United States, on the other hand, did not fight any lengthy wars between the American Revolution and 1860 and kept its national debt extremely low during that time. After the Civil War, however, the United States grew as an international power and expanded its geographical reach, which required new levels of spending and a level of national debt that was unprecedented before 1860.