key term - Cash and Carry program

Definition

The Cash and Carry program was a policy established in 1939 that allowed countries at war to purchase goods from the United States as long as they paid in cash and transported the goods themselves. This policy was aimed at helping the Allies during World War II while maintaining a level of neutrality for the United States. By requiring cash payments and self-transportation, the program aimed to reduce risks for American shipping and avoid entanglement in foreign conflicts.

5 Must Know Facts For Your Next Test

1. The Cash and Carry program was implemented as part of the Neutrality Act of 1939, reflecting America's desire to support Allies without direct involvement in the war.
2. Countries had to provide their own ships to transport purchased goods, which limited sales mainly to Britain and France, who had strong naval power.
3. This policy helped revive the American economy by increasing trade and production related to military supplies.
4. The Cash and Carry program marked a significant shift from previous neutrality policies, as it allowed direct military aid to belligerent nations under specific conditions.
5. The program ultimately paved the way for the Lend-Lease Act, which further deepened U.S. support for the Allies in World War II.

Review Questions

• How did the Cash and Carry program reflect America's shifting stance on neutrality during the late 1930s?
  • The Cash and Carry program illustrated a notable change in American foreign policy by allowing for limited engagement with countries at war while still maintaining a facade of neutrality. By permitting cash transactions and requiring self-transportation, the U.S. could assist Allies like Britain and France without committing troops or risking ships. This policy represented a pragmatic approach to supporting democratic nations while trying to avoid direct involvement in World War II.
• Evaluate the economic impact of the Cash and Carry program on American industries during the interwar period.
  • The Cash and Carry program significantly boosted American industries by stimulating demand for wartime goods such as munitions and supplies. As countries like Britain and France purchased military equipment using this policy, U.S. factories ramped up production, which contributed to economic recovery from the Great Depression. This program not only revitalized various sectors but also established stronger ties between the U.S. economy and those of allied nations preparing for conflict.
• Analyze how the Cash and Carry program set the stage for later policies like the Lend-Lease Act, and what this indicates about U.S. involvement in global affairs leading up to World War II.
  • The Cash and Carry program laid crucial groundwork for later initiatives such as the Lend-Lease Act by demonstrating America's willingness to support allies through economic means without direct military engagement. As the war progressed and threats increased, policymakers recognized that mere financial assistance was insufficient; thus, Lend-Lease expanded upon this foundation by allowing more comprehensive support, including military aid without immediate payment. This evolution signaled a departure from isolationism toward a more active role in global affairs, ultimately reshaping U.S. involvement as tensions escalated into full-scale war.

Related terms

Neutrality Acts:

A series of laws passed in the 1930s to prevent American involvement in foreign conflicts by restricting arms sales and loans to belligerent nations.

Lend-Lease Act:

A program established in 1941 that allowed the U.S. to supply Allied nations with war materials without immediate payment, marking a shift from strict neutrality.

Isolationism:

A foreign policy stance taken by the United States in the interwar period that emphasized staying out of international conflicts and avoiding alliances.