What was the purpose of rationing goods such as food and fuel in the United States during WW2 quizlet?

Rationing is the practice of controlling the distribution of a good or service in order to cope with scarcity. Rationing is a mandate of the government, at the local or federal level. It can be undertaken in response to adverse weather conditions, trade or import/export restrictions, or, in more extreme cases, during a recession or a war.

• Rationing is the limiting of goods or services that are in high demand and short supply.
• It is often undertaken by governments as a way of mitigating the impact of scarcity and dealing with economic challenges.
• Rationing risks generating black markets and unethical practices as people try to circumvent the austerity mandated by a ration.

Rationing involves the controlled distribution of a scarce good or service. An individual might be allotted a certain amount of food per week, for example, or households might be allowed to water their lawns only on certain days.

According to the law of supply and demand, when the available supply of a good or service falls below the quantity demanded, the equilibrium price rises, often to unaffordable levels. Rationing can artificially depress the price by putting constraints on demand.

Alternatively, price ceilings can be imposed; they risk the need for rationing in order to maintain a certain level of supply. In any case, rationing generally results in shortages. 

The 1973 Arab oil embargo caused gasoline supplies in the U.S. to plummet, pushing up prices. The federal government responded by rationing domestic oil supplies to states, which in turn implemented systems to ration their limited stocks.

In some states, cars with license plates ending in odd numbers were only allowed to fill up on odd-numbered dates, for example, while cars with even numbered plates were only allowed to fill up on even-numbered days. These responses kept gas prices from spiking further but led to long lines.

Faced with the choice of allowing the prices of basic necessities to rise inexorably, or imposing rations, governments typically choose the latter; policymakers in such circumstances must choose among policies that are all difficult and risk some negative impact.

Classical economic theory suggests that when demand exceeds supply, prices rise, and high prices, in turn, curtail demand and encourage new entrants to the market, increasing supply and bringing prices back down to reasonable levels. If the reality were this simple, rationing would be both counterproductive—because it creates shortages—and unnecessary, since the market will act to re-stabilize itself.

The problem is that for some goods and services—food, fuel, and medical care—demand is inelastic; that is, it does not fall in proportion to increases in price. Moreover, the entry of new suppliers to rebalance markets may not be possible if the shortage is the result of a crop failure, war, natural disaster, siege, or embargo. While not ideal, rationing is often undertaken by governments that would otherwise be facing an even bigger economic crisis.

Many capitalist economies have temporarily resorted to rationing in order to cope with wartime or disaster-related shortages: the U.S. and Britain issued ration books during World War II, for example, limiting the quantities of tires, gasoline, sugar, meat, butter, and other goods that could be purchased.

In communist countries, by contrast, rationing was in many cases a permanent or semi-permanent feature of daily life. In Cuba in 2019, a ration book entitled an individual to small amounts of rice, beans, eggs, sugar, coffee, and cooking oil for the equivalent of a few cents in the United States.

Since that is not enough to survive, Cubans must purchase additional supplies on the open market, where the price of rice is around 20 times higher. Additionally, there are limits on the number of higher-quality items Cubans can purchase on the open market, such as chicken.

Cuba has implemented rationing as a way of mitigating the impact of an economic crisis; citizens are entitled to small amounts of basic food for almost no charge, while everything else is pricey and supplies are limited.

Rationing provides governments with a way to constrain demand, regulate supply, and cap prices, but it does not totally neutralize the laws of supply and demand. Black markets often spring up when rationing is in effect. These allow people to trade rationed goods they may not want for ones they do.

Black markets also allow people to sell goods and services for prices that are more in line with demand, undermining the intent of rationing and price controls, but sometimes alleviating shortages.

NPS

During the Second World War, Americans were asked to make sacrifices in many ways. Rationing was not only one of those ways, but it was a way Americans contributed to the war effort.

When the United States declared war after the attack on Pearl Harbor, the United States government created a system of rationing, limiting the amount of certain goods that a person could purchase. Supplies such as gasoline, butter, sugar and canned milk were rationed because they needed to be diverted to the war effort. War also disrupted trade, limiting the availability of some goods. For example, the Japanese Imperial Army controlled the Dutch East Indies (today’s Indonesia) from March 1942 to September 1945, creating a shortage of rubber that affected American production.

On August 28, 1941, President Roosevelt’s Executive Order 8875 created the Office of Price Administration (OPA). The OPA’s main responsibility was to place a ceiling on prices of most goods, and to limit consumption by rationing.

Americans received their first ration cards in May 1942. The first card, War Ration Card Number One, became known as the “Sugar Book,” for one of the commodities Americans could purchase with their ration card. Other ration cards developed as the war progressed. Ration cards included stamps with drawings of airplanes, guns, tanks, aircraft, ears of wheat and fruit, which were used to purchase rationed items.

The OPA rationed automobiles, tires, gasoline, fuel oil, coal, firewood, nylon, silk, and shoes. Americans used their ration cards and stamps to take their meager share of household staples including meat, dairy, coffee, dried fruits, jams, jellies, lard, shortening, and oils.

Americans learned, as they did during the Great Depression, to do without. Sacrificing certain items during the war became the norm for most Americans. It was considered a common good for the war effort, and it affected every American household.

The World War II Memorial symbolizes sacrifice in more than one way. A wall of gold stars recognizes the American military personnel that were killed during the war. A brass relief panel has an image of men and women working on a farm chafing wheat. Since wheat was an important product, some men who lived on farms were exempted from military service, and few of them were drafted. Families like the one depicted in the memorial would have made a major sacrifice by losing an able-bodied farmhand, symbolized by the uniformed serviceman on the left. As the war progressed, German and Italian prisoners of war were used as farm laborers to assist in the food production that carried the war effort.

Agriculture is represented elsewhere in the memorial. Wheat wreaths on the columns of states and territories ringing the memorial are a reminder of the effort and sacrifice all Americans made to defend freedom and defeat tyranny in the Second World War.