How did America's post war success lead to the economic problems of 1970s?

After World War II ended, there was a significant concern that the economy of the United States would decline. The soldiers were returning home, and the United States didn’t think it would need to produce a lot of military supplies. However, this economic decline didn’t occur. Instead, there was a great deal of economic prosperity.
After the war, the American people wanted to buy items that they couldn’t buy during the war. People bought automobiles and electronic products. Many new houses were built. The government provided veterans with benefits under the GI Bill of Rights. This allowed veterans to obtain low-interest mortgages, which were used to buy houses. The veterans also received funds to go to school to get their degree. Loans were also made to help veterans begin a business. Additionally, there was a significant increase in the birth rate after World War II ended. This is known as the baby boom, which increased the number of consumers in the American economy. As a result, the American economy prospered after World War II ended. The gross national product increased from about $200,000 million in 1940 to about $500,000 million in 1960.
When World War II ended, the United States continued to produce military supplies. The United States was fighting the spread of communism in many places. The European Recovery Program was created. The United States gave aid to countries, such as Greece and Turkey, to fight the spread of communism. The United States continued to manufacture military supplies and developed new, advanced weapons such as the hydrogen bomb. These factors contributed to a growing, prospering economy.
However, this prosperity ended in the 1970s. There were many reasons why this occurred. One factor was that the United States faced more competition from other countries. As part of the fight against communism, the United States helped rebuild the economies in Japan and in Western Europe. Eventually, these countries developed industries that were more efficient than the American industries. These foreign industries, such as the automobile industry, could make products that were as good or better than American products. American industries had to find a way to deal with this competition.
Most American workers by the end of the 1960s weren’t fearful of an economic depression. Many workers had not directly experienced the huge unemployment crisis of the Great Depression. Thus, the workers expected and demanded significant pay raises and insisted on having some say in working conditions. As a result, labor costs increased for employers, which led to lower profits. When profits drop, businesses are less likely to invest and expand.
Inflation became an issue for the American economy in the 1970s. During the 1960s, the American government spent a great deal of money on the Vietnam War and on creating various social programs. This huge amount of spending, without a corresponding tax increase, created inflationary pressures. Then, in the 1970s, there was a huge increase in oil prices. The United States relied upon the importation of oil from countries in the Middle East. When OPEC embargoed the sale of oil to the United States because of the American support of Israel, oil prices jumped significantly. There also were shortages of oil. Even after the embargo ended, oil prices remained high. As a result, inflation increased significantly. In attempting to lower the inflation rate, policies were enacted that increased unemployment. For example, when interest rates were raised, less investment occurred, leading to the loss of jobs.
The post-World War II success of the United States ultimately led to economic problems for the United States in the 1970s.
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https://www.thoughtco.com/us-economy-in-the-1960s-and-1970s-1148142