On this day in economic and business history …
Victory Over Japan Day, popularly known as V-J Day, marks the surrender of Japan and the end of World War II on Sept. 2, 1945. The six years (and one day) preceding Japan’s surrender encompassed what British war historian John Keegan later called “the largest single event in human history.” Rather than examining the war in detail — which would take, and has taken, many books to achieve — let’s look at some brief numbers on the cost of that war, in human terms:
- More than100 million people served in the militaries of more than 30 countries.
- Around 70 million people died (estimates vary from 50 million to more than 85 million).
- Roughly 10% of German citizens perished, and 16% of native Poles lost their lives.
- 27 million people from the Soviet Union died as a result of the war.
- More than 30,000 people were killed for every day the war continued.
- Germany and Japan pressed a combined 30 million people into slave labor.
And now in economic terms:
- The war cost belligerent nations an estimated $1.6 trillion combined.
- That would be equivalent to $20.8 trillion today.
- U.S. government spending peaked at more than $105 billion in 1944.
- That was 48% of U.S. GDP for 1944.
- Allied GDP reached a low of 1.6 times Axis GDP in 1940.
- By the end of 1945, combined Allied GDP was five times as large as Axis GDP.
- The Allies won, in large part, by vastly outproducing the Axis powers:
|Weaponry or Materiel||Allied Wartime Production||Axis Wartime Production||Total|
|Tanks and self-propelled guns||227,235||52,345||279,580|
|Artillery and mortars||1,572,001||280,141||1,852,142|
|Coal used||4.3 billion metric tons||2.6 billion metric tons||6.9 billion metric tons|
|Iron ore used||591 million metric tons||291 million metric tons||882 million metric tons|
|Crude oil used||6.8 billion barrels||430 million barrels||7.2 billion barrels|
The end of World War II also marked a shift in the American economy. As the only major combatant to have escaped with its domestic infrastructure largely unscathed, the United States was in a unique position to convert its manufacturing Arsenal of Democracy into a peacetime production juggernaut. As a result, the American economy soared, and so did the fortunes of American investors. Real gross domestic product grew more than fivefold in the five decades that followed the end of the war. The Dow Jones Industrial Average (INDEXDJX:.DJI), which had existed for 49 years before the end of the war, grew at a rather tepid annualized rate of 3.3% during those 49 years. After the war, its growth rate for the next half-century leapt to 7.9% per year.
Unilever plc (ADR) (NYSE:UL) was formed on Sept. 2, 1929, by the merger of British soap-maker Lever Brothers and Dutch food-oil-product producer Margarine Unie.
The latter company had been formed only two years earlier by the amalgamation of several European companies operating in similar lines of business. Margarine Unie’s origins dated to 1872 in the Netherlands, when the Jurgens and Van den Burgh families each set up margarine factories. In 1884, meanwhile, William Lever began making soap. The two companies had no real overlap until 1909, when both companies (the two Dutch margarine-makers had partnered a year earlier) set up palm plantations to supply their booming businesses. By the 1920s, each company was well aware of the other. The 1929 merger agreement came about after Margarine Unie began acquiring European consumer-products companies at a breakneck pace — between its formation and the Lever merger, Margarine Unie came to virtually monopolize the production of anything based on oils and fats.