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CHAPTER 12: POSTWAR AMERICAOUTLINE OF U.S. HISTORYready to investigate subversive activity,President Truman established aFederal Employee Loyalty Program.It had little impact on the lives ofmost civil servants, but a few hundredwere dismissed, some unfairly.In 1947 the House Committeeon Un-American Activities investigatedthe motion-picture industryto determine whether Communistsentiments were being reflected inpopular films. When some writers(who happened to be secret membersof the Communist Party) refusedto testify, they were cited forcontempt and sent to prison. Afterthat, the film companies refused tohire anyone with a marginally questionablepast.In 1948, Alger Hiss, who hadbeen an assistant secretary of stateand an adviser to Roosevelt atYalta, was publicly accused of beinga Communist spy by WhittakerChambers, a former Soviet agent.Hiss denied the accusation, but in1950 he was convicted of perjury.Subsequent evidence indicates thathe was indeed guilty.In 1949 the Soviet Union shockedAmericans by testing its own atomicbomb. In 1950, the government uncovereda British-American spy networkthat transferred to the SovietUnion materials about the developmentof the atomic bomb. Two ofits operatives, Julius Rosenberg andhis wife Ethel, were sentenced todeath. Attorney General J. HowardMcGrath declared there were manyAmerican Communists, each bearing“the germ of death for society.”The most vigorous anti-Communistwarrior was Senator Joseph R.McCarthy, a Republican from Wisconsin.He gained national attentionin 1950 by claiming that he had a listof 205 known Communists in theState Department. Though McCarthysubsequently changed this figureseveral times and failed to substantiateany of his charges, he struck aresponsive public chord.McCarthy gained power whenthe Republican Party won controlof the Senate in 1952. As a committeechairman, he now had a forumfor his crusade. Relying on extensivepress and television coverage, hecontinued to search for treacheryamong second-level officials in theEisenhower administration. Enjoyingthe role of a tough guy doingdirty but necessary work, he pursuedpresumed Communists with vigor.McCarthy overstepped himselfby challenging the U.S. Army whenone of his assistants was drafted.Television brought the hearings intomillions of homes. Many Americanssaw McCarthy’s savage tactics forthe first time, and public supportbegan to wane. The RepublicanParty, which had found McCarthyuseful in challenging a Democraticadministration when Truman waspresident, began to see him as anembarrassment. The Senate finallycondemned him for his conduct.McCarthy in many ways representedthe worst domestic excessesof the Cold War. As Americansrepudiated him, it became naturalfor many to assume that the Communistthreat at home and abroadhad been grossly overblown. As thecountry moved into the 1960s, anti-Communism became increasinglysuspect, especially among intellectualsand opinion-shapers.THE POSTWAR ECONOMY:1945-1960In the decade and a half afterWorld War II, the United Statesexperienced phenomenal economicgrowth and consolidated its positionas the world’s richest country. Grossnational product (GNP), a measureof all goods and services producedin the United States, jumped fromabout $200,000-million in 1940 to$300,000-million in 1950 to morethan $500,000-million in 1960.More and more Americans nowconsidered themselves part of themiddle class.The growth had different sources.The economic stimulus providedby large-scale public spending forWorld War II helped get it started.Two basic middle-class needs didmuch to keep it going. The numberof automobiles produced annuallyquadrupled between 1946 and 1955.A housing boom, stimulated in partby easily affordable mortgages forreturning servicemen, fueled the expansion.The rise in defense spendingas the Cold War escalated alsoplayed a part.After 1945 the major corporationsin America grew even larger. Therehad been earlier waves of mergersin the 1890s and in the 1920s; in the1950s another wave occurred. Franchiseoperations like McDonald’sfast-food restaurants allowed smallentrepreneurs to make themselvespart of large, efficient enterprises.Big American corporations alsodeveloped holdings overseas, wherelabor costs were often lower.Workers found their own liveschanging as industrial Americachanged. Fewer workers producedgoods; more provided services. Asearly as 1956 a majority of employeesheld white-collar jobs, workingas managers, teachers, salespersons,and office operatives. Some firmsgranted a guaranteed annual wage,long-term employment contracts,and other benefits. With suchchanges, labor militancy was underminedand some class distinctionsbegan to fade.Farmers — at least those withsmall operations — faced toughtimes. Gains in productivity ledto agricultural consolidation, andfarming became a big business.More and more family farmers leftthe land.Other Americans moved too.The West and the Southwest grewwith increasing rapidity, a trend thatwould continue through the endof the century. Sun Belt cities likeHouston, Texas; Miami, Florida; Albuquerque,New Mexico; and Phoenix,Arizona, expanded rapidly. LosAngeles, California, moved ahead ofPhiladelphia, Pennsylvania, as thethird largest U.S. city and then surpassedChicago, metropolis of theMidwest. The 1970 census showed266267