Mobilization

The American economic and military mobilization for World War II made the United States the great “arsenal of democracy” that provided munitions, materials, and military power indispensable to victory over the Axis. By 1944, the United States accounted for about 40 percent of all war goods produced in the world, and throughout the war the U. S. sent supplies to its allies under the provisions of the Lend-Lease Act.

Mobilization had important domestic consequences as well. It vanquished not only the Axis but also the Great Depression, as unemployment dropped from 15 percent to 1 percent between 1940 and 1944 and the gross national product more than doubled. It triggered massive migration, particularly to the Sunbelt states, which held so many military facilities and war plants. And it greatly increased the size, cost, and power of the federal government.

Mobilization of the American military proceeded more easily than many had expected after passage of the initial Selective Service legislation in September 1940. The draft got under way in October, and by 1945 the Selective Service System had administered the conscription of some 10 million of the 16 million men who served in the armed forces. Training camps and operational bases had to be enlarged and constructed, and a huge new military and civilian bureaucracy built. Inevitably there were problems and protests, but on balance the system worked well, providing the U. S. Army and U. S. Navy sufficient personnel to carry out their operations in the World War II European theater and the World War II Pacieic theater. Together with the War Manpower Commission—and sometimes in conflict with it—the Selective Service System tried to allocate manpower optimally between essential civilian tasks (especially in war industry) and the armed forces.

Economic mobilization underwent a disorganized and sometimes disheartening beginning before reaching the prodigious levels that underwrote the victory of the Grand Alliance over the Axis and the return of prosperity to the American economy. President Franklin D. Roosevelt from the start set what seemed impossibly high production goals—in 1940, for example, he called for producing

50,000 airplanes per year—and his habits of administration made the organization of war mobilization less effective and orderly than it might have been. But the president also provided crucial leadership for both the World War II home ERont and the battlefronts and eventually hit upon an organizational framework that did the job.

Difficulties were inevitable, however, because economic mobilization involved such formidable challenges. Existing production facilities had to be converted to war production and new ones had to be built. Mechanisms had to be established for finding and allocating the raw materials, supplies, manpower, and money necessary for mobilization. Priorities and schedules had to be set for producing a bewildering variety of war and consumer goods. And there had to be enough production not just for American needs but for shipments of materials, munitions, and food to the Allies.

Poster depicting woman operating a machine as part of the World War II production effort (Library of Congress)

The real beginning of economic mobilization came with the National Defense Appropriation Act of 1940, which initiated the appropriation of billions of dollars for defense after the Nazi blitzkrieg had overrun western Europe that spring. In 1939 and 1940, Roosevelt had begun working toward an effective organizational and bureaucratic framework, and in January 1941 he established the Oeeice oe Production Management (OPM) to coordinate conversion to defense production. The OPM, however, proved ineffective in mobilizing the economy, partly because prior to Pearl Harbor many manufacturers (in the steel industry and the automobile industry, for example) resisted converting to war production as domestic markets began to revive after the long decade of the depression.

In January 1942, Roosevelt created the War Production Board (WPB) to succeed the OPM. But the WPB lacked authority over manpower, and the military had final authority over contracts. WPB director Donald M. Nelson, moreover, lacked the leadership skills necessary for the task. In May 1943, the president established the Oeeice oe War Mobilization (OWM) as a sort of superagency to coordinate all the various mobilization agencies and efforts, including the “czars” established for such key materials as rubber and petroleum. FDR appointed former South Carolina senator and Supreme Court justice James F. Byrnes as head of the OWM and invested him with such authority that he became known as the “assistant president.”

By 1943, war production and its administration at last began to hit their stride. From the beginning, the government used such devices as subsidies, low-cost loans, tax write-offs, and guaranteed profits with “cost-plus” contracts to bring about conversion and expansion of production sites. The substantial slack in the economy in 1940 facilitated the initial stages of war production, since the need was to mobilize underutilized factories, labor supplies, and materials, rather than to squeeze more out of already mobilized resources. Subsequently, productivity gains and management efforts as well as government assistance helped raise output. The Controlled Materials Plan developed by the WPB in the fall of 1942 enabled an effective allocation of raw materials. The dollar-a-year men, brought into Washington from business to staff the mobilization agencies because of an insufficient number of experienced government officials, helped too. And even in 1938, after the recession Of 1937-1938, American national income had been almost twice the combined national incomes of Germany, Japan, and Italy, so the United States could build upon a formidable economic base.

Contracts for the production of war goods went disproportionately to the old or emerging giants in autos, steel, the aircraet industry, electronics, and other industries. Thirty-three firms garnered more than half of all prime war contracts awarded from 1940 to 1944. That was partly because representatives of big business played an important role in the war agencies, but mostly because it made sense to turn to the biggest, most experienced and productive companies to turn out the desperately needed war goods. The mobilization process also brought business and the military into closer contact, helping create what President Dwight D. Eisenhower would later call the “military-industrial complex.”

The quality as well as the quantity of war goods was sometimes disappointing at first. Aircraft, torpedoes, tanks, and semiautomatic rifles, for example, had early problems and were sometimes inferior to Japanese and German counterparts. But inexorably, American production improved qualitatively as it surged quantitatively. Advances in science and technology made key contributions, and like production were often underwritten by government funds. In this, the Oeeice oe Scientieic Research and Development was instrumental, helping to develop items from proximity fuses to radar to the atomic bomb—and helping also to develop what some have called the “military-industrial-scientific complex.”

A variety of other home-front efforts supported and supplemented the mobilization agencies. The Oeeice oe Price Administration (OPA) administered price controls and rationing of scarce civilian goods. Wage and price controls helped keep wartime inflation under control, while rationing sought to ensure an equitable distribution of consumer goods in short supply. The National War Labor Board worked to achieve wage and other settlements that would satisfy labor and avoid strikes that would disrupt production. The Reconstruction Finance Corporation lent money for plant expansion. To staff this mammoth effort, the number of civilian employees of the federal government quadrupled, from about 1 million to roughly 4 million.

Mobilizing for war was extraordinarily expensive. In all, the federal government spent some $300 billion during the war—almost twice as much as in its previous history from 1789 to 1941—and annual expenses soared from $9 billion in 1939 to $98 billion in 1945, when government spending accounted for nearly half of gross national product. Taxation provided essential revenues for the government as well as siphoning off money from consumer spending and thus reducing inflation. But taxes provided less than half of government expenses. Borrowing—including via war bonds—accounted for the rest, and the combination of heavy deficits and returning prosperity confirmed the tenets of Keynesianism and the importance of eiscal policy to the performance of the economy.

War production reached its peaks of output and efficiency by 1943 and 1944. Industrial output increased by about 15 percent yearly from 1940 to 1944, and by one estimate American output per work hour was twice that of Germany and five times that of Japan. Perhaps no industry so well revealed American ingenuity and mass-production techniques as shipbuilding, particularly by Henry J. Kaiser. The fabled wartime “prodigies of production” yielded (estimate vary) some 300,000 aircraft, 90,000 tanks, 80,000 landing craft, 5,800 merchant ships, 1,500 navy ships, 2.6 million machine guns, 20 million small arms, 41 billion rounds of ammunition, and 6 million tons of bombs. Yet the United States never devoted its economy so heavily to war production as did other nations at war; about 40 percent of the U. S. GNP went to war goods, for example, whereas more than half did in Britain and Germany.

By 1944, with an Allied victory clearly in sight, attention began to turn to reconversion to a peacetime economy and demobilization of the wartime military. In late 1944, the Office of War Mobilization was converted to the Oeeice oe War Mobilization and Reconversion, and the WPB and other agencies began to plan for (and sometimes squabble about) when and how to implement reconversion. War production declined in 1945, particularly after the surrender of Germany in May. With the surrender of Japan in August, reconversion and demobilization began in full force. The nation now had to deal with a new set of issues and problems, including achieving the paramount aim of most Americans—how to ensure a full-employment economy once the stimulus of war mobilization was gone.

Further reading: Keith E. Eiler, Mobilizing America: Robert P. Patterson and the War Effort (Ithaca, N. Y.: Cornell University Press, 1997); Eliot Janeway, The Struggle for Survival: A Chronicle of Economic Mobilization in World War II (New Haven, Conn.: Yale University Press, 1951); Donald M. Nelson, Arsenal of Democracy: The Story of

American War Production (New York: Harcourt Brace, 1946); Harold G. Vatter, The U. S. Economy in World War II (New York: Columbia University Press, 1985).

Moley, Raymond C. (1886-1975) professor, government official

Raymond Charles Moley, known for his role as leader of the Brain Trust of Franklin D. Roosevelt, was born on September 27, 1886, in Berea, Ohio. He received his bachelor’s degree from Berea’s Baldwin-Wallace College and a master’s degree from Oberlin College before embarking on an initial career in education as a teacher and superintendent of schools. In 1914, he entered the doctoral program in political science at Columbia University.

After receiving his Ph. D. in 1918, Moley became an assistant professor of politics at Western Reserve University in Cleveland. In 1919, he accepted an appointment as director of the Cleveland Foundation, which undertook civic reform through research on urban problems, cooperation between business and government, and local philanthropy. Moley remained at this post until 1923 when he returned to Columbia as an associate professor of public law. Moley became an expert on criminal justice and it was in this capacity that he worked with Roosevelt when FDR was governor of New York from 1928 to 1932. In the Brain Trust that he was asked to form during Roosevelt’s 1932 campaign for president, Moley advocated a policy of cooperation between business and government developed during his years with the Cleveland Foundation.

After Moley and the Brain Trust advised Roosevelt during the election Of 1932, Moley played a major role in shaping the First New Deal of 1933 that sought to achieve economic recovery by means of planning and controls worked out with business. He was appointed an assistant secretary of state in the new Roosevelt administration, but lasted less than a year in the position. His most famous assignment was as a delegate to the London Economic Coneerence of June and July 1933, where he was instructed to negotiate a currency stabilization agreement. After concluding a seemingly innocuous agreement, Moley was heralded by the American press as the savior of American interests at the conference. This success was short-lived, however, as Roosevelt revoked the agreement on July 3 employing, in the ultimate of ironies, Moley’s own idea that domestic economic reform should take precedence over international agreements.

Moley resigned from his State Department post in the autumn of 1933 to resume his teaching at Columbia and to assume the editorship of the political magazine Today. He continued as an occasional speechwriter for Roosevelt until 1939, when he publicly disengaged himself from the New Deal, disillusioned with what he perceived as its increasing hostility to business. In later years, Moley became associated with the conservative wing of the Republican Party. He died in Phoenix, Arizona, on February 18, 1975. While his direct political influence in the creation of the New Deal was limited, his accounts of the election of 1932 and the “Hundred Days” found in his books, After Seven Years (1939) and The First New Deal (1966), have made a significant contribution to historical understanding of Roosevelt’s first administration.

Further reading: Raymond Moley, After Seven Years (New York: Harper, 1939).

—Mary E. Carroll-Mason