The Arsenal of Democracy: The American Automobile Industry in World War II

Nine: The Achievement

w hen the United States officially entered World War II following Pearl Harbor , a powerful alliance between the military services and the automobile industry was already in place, resulting in a system for procuring and producing military equipment in significant quantities. President Franklin Roosevelt developed and nurtured this system with the cooperation and assistance of key leaders in the military services, the private sector, and allies within his administration and Congress. He devised a series of innovative strategies to equip America’s rapidly expanding military forces in peacetime when the political landscape featured strong isolationist, noninterventionist forces and widespread fears of wartime profiteering by military contractors. His overall political strategy, which continued after Pearl Harbor, was to grant the military and civilian defense contractors far-reaching control over the mobilization of American industry for war production. At the same time Roosevelt minimized the influence of the left wing of the Democratic Party (the New Dealers), organized labor, and Congress. Converting the economy to war production got off to a rocky start in 1942, with delays in deliveries of war materiel and severe raw materials shortages, but these problems were largely overcome in 1943. Two innovations in the organization of war production helped the civilian authorities, the military services, and the private sector to work together effectively to produce sufficient war goods. The first was the nine The Achievement 202 chApter nine system of procurement contracts initiated and controlled by the military services with minimal civilian oversight. The CPFF contract became the norm, especially for large procurement contracts. The provision for renegotiation of contracts mandated by Congress in April 1942 combined with federal excess profits taxes minimized war profiteering. The DPC financed nearly $10 billion in defense plant construction, which facilitated war production. Starting in December 1940, the DPC also largely controlled the supply and distribution of critical machine tools for the war effort. The mix of machine tools produced and their distribution reflected the priorities set by the military services. Despite occasional bureaucratic bickering within and between wartime mobilization agencies, including the military services, the wartime planning and procurement system worked reasonably well, although there were mistakes and failures along the way. Harnessing the resources and expertise of the American automobile industry, as well as the great untapped sources of labor, mainly African Americans and women, to manufacture and assemble the needed war materiel helped contribute to the success of the arsenal of democracy. How successful was this alliance of the military, the civilian federal bureaucracy, and the automobile industry in creating an effective arsenal of democracy? One measure is a comparison of prewar manufacturing capacity with the production of combat munitions during the war. The United States had 32 percent of the world’s manufacturing capacity in 1936–38, but in 1942, the first year of full conversion to war production, accounted for only 20 percent of munitions production by the major belligerents. That share jumped to 38 percent in 1943 and to 42 percent in 1944. The British economy was responsible for slightly more than 9 percent of the world’s manufacturing capacity in the late 1930s but did not achieve a comparable share of munitions production until 1942, despite its much earlier start in converting its manufacturing to war production. Britain accounted for 11 percent of munitions production in 1943 and 1944, reflecting a more complete conversion.1 One might have expected three belligerents controlled by dictators—the Soviet Union, Nazi Germany, and Japan—to have fared better in making war goods than the democracies, especially in light of their earlier rearmament programs. The Soviet Union, with 18.5 percent of the world’s manufacturing capacity in 1936–38, accounted for 12–16 percent of weapons production in 1942–44. Nazi Germany, with slightly less than 11 percent of the world’s manufacturing capacity in the late 1930s, produced 8.5 percent of weapons manufactured by the belligerents in 1942, 13.5 percent in 1943, and 17 percent in 1944. Finally, the Japanese economy, which had only 3.5 percent of the world’s manufacturing capacity in 1936–38, reached 4.5 percent and 6 percent of combat weapons production in 1943 and 1944, respectively. the Achievement 203 The German manufacturing achievement, especially in 1943 and 1944, was impressive given the extensive bombing of German industry by the Allies. The American production achievement was primarily the result of its large manufacturing base but also reflected...