MASTER NEGATIVE NO. 95-82476 COPYRIGHT STATEMENT The copyright law of the United States (Title 17, United States Code) governs the making of photocopies or other reproductions of copyrighted materials including foreign works under certain conditions. In addition, the United States extends protection to foreign works by means of various international conventions, bilateral agreements, and proclamations. Under certain conditions specified in the law, libraries and archives are authorized to furnish a photocopy or other reproduction. One of these specified conditions is that the photocopy or reproduction is not to be "used for any purpose other than private study, scholarship, or research. If a user makes a request for, or later uses, a photocopy or reproduction for purposes in excess of "fair use," that user may be liable for copynght infringement. The Columbia University Libraries reserve the right to refuse to accept a copying order if, in its judgement, fulfillment of the order would involve violation of the copyright law. Author: Clarkson, Grosvenor B. Title: Industrial America in the world war Place: Boston Date: 1 923 COLUMBIA UNIVERSITY LIBRARIES PRESERVATION DIVISION BIBLIOGRAPHIC MICROFORM TARGET Qv CD o o en rsi 3 3 > W 0,0 o m (DO X X V > '?^: ..v^ ^1 ^^ >^ 8 O 3 3 > U1 o 3 3 o o 3 3 1.25 I.I FE is 1.4 o CO S to bo a 00 10 o In 1.0 mm 1.5 mm 2.0 mm ABCDEFGHIJKLMNOPQRSTUVWXYZ abcdefghi|klmnopqrstuvwxyzl234 667890 ABCDEFGHIJKLMNOPQRSTUVWXYZ abcclefghijklmnopqrstuvwxyzl234 567890 ABCDEFGHIJKLMNOPQRSTUVWXYZ abcdefghijklmnopqrstuvwxyz 1234567890 2.5 mm ABCDEFGHIJKLMNOPQRSTUVWXYZ abcdefghijklmnopqrstuvwxyz 1234567890 '^ ^f^^' i' ^o ¥* f^ Hs- c^ ^^ i? f^ m H O O > C CO Z ^ ^ 0(/) 5 m O m V «« <^ .<^ ir •?= <5.o ^o ?# ^P h-* i\> CJI 3 3 3 o > Wo t? HIJKLM inopqn IJKLM nopqr Jiz jy-z OPQRST uvwxyzl OPQR uvwxy I^CI N (/> 01$ a>x ^■< OOtM s 5^ a»x ^-< OOM VO ■«■> 4^. "^' f^ •/M^ 4^ -15 T:-t : t. mi l> i^t. . , ~ • I ,1, ' ^t • I *. ! t t? * t E^ JT* =-». '' .^^^j^j- - i'^'JH'^E^ "I?*^ - , i.. 7- ^i-.. »^ ia 2 , • f - - «-*•-/. l" * *- ^'ffi * V— * L,^ t - ! - li . rt?-i?-T. * J ^ - . ^ c almnbia Ottitoi . iftp THE LIBRARIES SCHOOL OF BUSINESS INTENTIONAL SECOND EXPOSURE ^ *» 5 i£ "w a» 9 c Oj eg ,< « 4> 2 »> a •♦J r» C5 .-. a aj ^ I ^- 1 1 s ■' " 1 M ^ _ . S3 0/ O — I s ^ -t^ bJ o =j •= >. . « - ^i S-H £? ^u ^ g 8 o o> = cc S t-i 03 "3 i,' S .° "% ^ =3 hh' -*' >S •-5 q K Ph S ^ 3 INDUSTRIAL AMERICA IN THE WORLD WAR The Strategy Behind the Line 1917-1918 By GROSVENOR B. CLARKSON LATE DIEECTOE OF THE OmiED 8TATE3 COUNCIL OP NATIONAL DEFENSE WITH AN INTRODUCTION BY GEORGES CLEMENCEAU I And with Illustrations Her [America's] brilliant, if pitiless, tear industry had entered the service of patriot- ism and had not failed it. Under the compulsion of military necessity a ruthless autocracy was at work and rightly, even in this land at the portals of which the Statue of Liberty flashes its bUnding light across the seas. They understood war. VON HINDENBCBO BOSTON AND NEW YORK HOUGHTON MIFFLIN COMPANY Z^t 3aitier£;ibe $re£» Cambnbge l^9& m 1 V ^ fc COPYRIGHT, Z933t BT GSOSVENOR B. CLARESON ALL RIGHTS RESERVED CD CD , — 00 o Ul To the Memory of my Father ' JAMES S. CLARKSON CAMBRIDGE • MASSACHUSETTS PRIHTSO m TBB U.6^ , ^ t , ■ • I '. • * ; ' ' •It • * V. • ft • * « I 1 t . c c • • • t . t • » • • « * » ♦ * ? • ft ■ .1 » I • I • « ft t PREFACE This volume deals with the final, culminating, and decisive phase of America's mobilization and use of her industrial and economic resources in the World War. This phase, of necessity, has to do with the United States War Industries Board in the full flower of its powers and performance. No attempt has been made to depict the pre- liminary industrial mobilization under the Council of National Defense other than to describe in high relief the evolutionary process, often dramatic, out of which came the War Industries Board in its final form. Similarly, little or no appraisal has been made of the achievements or personalities of the hurried war prepara- tions under the Council of National Defense and its subor- dinate bodies from six weeks before the entrance of the United States into the war until the autumn of 1917. This period may be treated in another volume, which would also, of course, include an account of the great field forces of the Council of National Defense under which operated the 184,000 units of the state, county, community, and munic- ipal councils of defense throughout America, a machinery which transmitted to the people of the country the war meas- ures and needs of the National Administration, sent back to Washington the moods and aspirations of the people, and maintained the morale of American citizenship from begin- ning to end of America's participation in the war. It would likewise contain a recital of the stirring and fruitful contri- bution of the women of America organized under the Council of National Defense. In the present work, the writer has not only devoted many months of research into the ofiicial records to supplement and verify his own knowledge of the events described; he has, in addition, taken nearly 700,000 words of statements from the pivotal figures in the administration of the War Industries Board dealing with things and rendering conclu- sions of a substance and color that no official record ever Vlll PREFACE PREFACE IX contains. Throughout, the greatest- possible care has been exercised in statements of facts, a precaution imperative in the interpretative analysis of industrial and economic matters. The present volume is in no sense a special pleading for anything or anybody. The writer has earnestly tried to deal with this particular bit of history in a just, detached, and objective manner. He has eliminated himself as much as possible from the narrative, departing from this course only when it has seemed useful to do so. The writer acknowledges with much gratitude the coopera- tion extended to him by the great company of business men who moulded the work of which he writes. They have, with- out exception, given him the underlying facts that he desired, and given them to him candidly without seeking to influence his own analysis and appraisal of the events and achieve- ments described. The writer was irresistibly impelled to this recital because nowhere, in the Government or out of it, could he discern any adequate recognition of the services of these men — the doUar-a-year men, if the reader please — with whom he was associated in what were to him the most worth-while years of his life. The lack of appreciation of what they did and of the spirit that underlay their contribution is, in the writer's judgment, supremely unjust. He trusts that the fol- lowing pages will in some measure illumine their quiet unselfishness and their tremendous deeds. Finally, it is a matter of regret that in a history of this kind it is not possible to do justice to all of the personalities of the action. Their mere number precludes that, and the technical and specialized nature of the duties of very many of them would shroud any account in dullness and weariness for the general reader. The men who did the real work of the War Industries Board must, like the common soldiers in battle, remain largely unknown and unhonored. The military historian has no choice in the tale of a battle but to italicize the victorious general and pass by and bury the individual soldier in the sum of casualties. So it is in this recital. Highly important but more obscure and unpre- tentious achievements must be unnoticed. Little can be done to ofi'set this inevitable inequality than to preserve in the Appendix the roll of the personnel of the War Industries Board and of vital bodies directly concerned with its work. These men were singularly heedless of praise or recognition, and they will understand. They worked as the best soldiers fought, pro patria; the strong and poignant satisfaction of honest service in an impelling hour was their chief reward, and, after all, there is no reward equal to that. Grosvenor B. Clarkson (( I I 7i CONTENTS t CHAPTER I THE CRISIS AND HOW IT WAS MET The inexorable demands of modem war — A contest of peoples and indus- tries as well as of armies — America the last reservoir of resources — The untold tale of the war — The Nation's inertia before the storm — Staging the huge industrial drama — Approximating autocracy 3 CHAPTER II THE COUNCIL OF NATIONAL DEFENSE AND ITS ANTECEDENTS Preparedness in a democracy — The roots of industrial defense — The Council's birth — Early gropings — First contacts with industry — The cry for concentrated power — The mass begins to move 10 CHAPTER III THE WAR INDUSTRIES BOARD EMERGES The objective in sight — Synchronizing the civilian dollar-a-year man with the military — The machine lags — The bitter price of unpreparedness — The President acts — Enter Baruch — Review of the drifting period — Baker and Baruch — The new dispensation — Industry now stripped for war .....:... ^ 40 CHAPTER IV THE PERSONAL ELEMENT Baruch — Conscripting the brains of industry — The dollar-a-year man arrives — Seeking the industrial doer — Willard — Scott — Legge — Peek — Replogle — Parker — Brookings — Summers — Frayne — Fletcher — Johnson 65 CHAPTER V THE SOURCE OF POWER From the acorn the oak — Administration by request — The right to com- mandeer — Cooperation the supreme power — Discipline through public opinion — Baruch and Wilson — Baruch in the saddle — Tying-in the executive agencies for a common will to war 94 CHAPTER VI THE DRAMA OF REQUIREMENTS AND RESOURCES L General Considerations and "Clearance" War on the modern scale — America asleep — The awakening — The cry of the Allies — Doing the impossible — Chaos in the War Department — Harnessing the flood of orders — Clearance and its workings 107 xii CONTENTS CHAPTER VII THE DRAMA OF REQUIREMENTS AND RESOURCES (continued) II. The Broader Phase **Business as usual*' to the scrap-heap — Taking the long view — "Require- ments'* a central coordinator — Demanding team-work of the star players — General March and the War Industries Board — Through the neck of the bottle to victory — The stupendous military programme — Baruch and a cablegram from Pershing — The lesson of a disaster averted 121 CHAPTER VIII DISCIPLINING A NATION: PRIORITIES IN PRINCIPLE AND IN ACTION The torrential demand for goods — Visualizing a nation's need — The making of an explosive shell — Everybody for himself — What priority is — Priority becomes a center of power — "Essential'* versus "non-essential** industries — Rationing a people and their commerce — The parable of the eggs — "Class AA" to "Class D" — Business and the spirit of common service — The army calls for underwear — The national policing of in- dustry — Locomotives, steel, brass, nitrate, acetone, coal, cotton — Which first in the race against time? — Saving the French 75*8 — Pershing wants mules — Priority supreme. 138 CHAPTER IX THE CONTROL OF PRICES Public justice and price-fixing; but above all, production for war — Raw materials the heart of the problem — Forestalling the profiteer — The famous copper agreement — Checking the rising prices — Steel control-- Price-regulation in a democracy — Wilson and prices — An isolated judi- cial body — Baruch's conception of industrial control — The mechanics of the question — Avoiding rigid policies — Sense and sentiment in prices — Judge Gary queries Judge Lovett — General results of controL . . . 160 CHAPTER X BALANQNG SUPPLY AND DEMAND The twilight zone between essential and non-essential industries — Looking beyond the war — Jewelry and automobiles — An industrial operating clinic — What happened to the building trade — Baruch writes Mayor Hylan — Politics adjourned — Rifles, artillery, gun mounts — Ferreting out hoarded goods — Housing fifty army divisions — The Board and the rail- yfoys — Breaking a great transportation jam — The searchlight of statistics — The War Trade Board ties in — The legal factor 181 CONTENTS Xlll Curtailing the capricious customer — Paper wrappers for wooden cases — Excising the dead matter of industry — Nine lines of approach —■ Ambas- sador Jusserand and the modistes — Shaw attacks corset steel, tin, spool thread, typewriter ribbons, farm wagons, buggy axles, trace chains, motor- cycles, alarm clocks, tinfoil — Salvaging wool for nine hundred thousand uniforms— Peace-time benefits — Shaw meets Baruch — Conservation with- out destruction succeeds — Lessons for to-day and to-morrow 209 CHAPTER XII CONVERSION: THE METAMORPHOSIS OF INDUSTRY What France learned — Our own peculiar problem — Making haste slowly — Converting regions as well as plants — Should our industries have been pooled with the Allies*? — The early days of conversion — Peek arrives — Otis goes into action — He converts Baruch — The regional system is born — Conversion by long-distance telephone — Applying the continental vision of industry — Those who also served — Graphic forms of conversion. . . 232 CHAPTER XIII DISBURSING FIFTEEN BILLION DOLLARS: THE INTER-ALLIED PURCHASING COMMISSION The New World succors the Old — A golden key for the Allies — Estab- lishing a central control — Legge's way — The traditional obstacles — Mastering the common problems of supply — A great coalition at work — Fifty-two million dollars for one item — Northcliffe, Brand, Tardieu, and Tozzi. •••■•••••• •• • • •••• 250 CHAPTER XIV AMERICA AND WORLD WAR ECONOMICS: THE FOREIGN MISSION AND INTERNATIONAL EXECUTIVES Buttressing the world's economic structure — Baruch demands reciprocity from the British — The Foreign Mission lays its plans — The British Gov- ernment meets Summers — Austen Chamberlain and Winston Churchill cooperate — Seventy-five million dollars saved — Summers takes charge of a meeting — Conserving steel for war — The story of two million shoes. . 261 CHAPTER XV THE CONTROL OF LABOR The human understanding of labor — Obtaining workers for war industries — Salvaging waste man power and materials — Gompers in the war — His call to lai)or — Scrutinizing the I.W.W. — Some early history — The Taft- Walsh Board — The War Labor Policies Board — Employment management — Labor after the war — Priorities in labor 276 CHAPTER XI CONSERVATION: REDUCING AMERICA'S SURPLUS TISSUE Thrift at the source — Shaw projects his plan — First, economy; second, economy; third, economy — Bread for two hundred thousand persons saved — The chemistry of voluntary cooperation — The technique of procedure — CHAPTER XVI IN THE SEAT OF POWER Pacifism and the dollar expended — Industry in a blind alley — The trans- formation — A one-man authority arises — Should it have been expanded further? — The Board's hard road to power 293 k< xiv CONTENTS CHAPTER XVII THE BACKBONE OF THE BOARD: THE COMMODITY SECTIONS Banich taps three hundred and fifty industries — Administrative organiza- tion at its height — The mechanism vizualized — The Board's genesis — The discarded committee plan — Dissecting the commodity sections — The appetite for facts — A head center for producer and consumer — Guess- work annihilated — Industry mobilized, drilled, and militant — Coordinated industry at the service of coordinated consumption — The philosophy of business in Government — Dreams of an ordered economic world. . . . 299 CHAPTER XVIII STEEL: AN EPIC OF THE WORLD WAR I. A conflict of blood and iron — The super-demand for steel — A nation's industries rock — The Board a storm center — Demand breeds demand — The attitude of the steel producers — Replogle's faith — Baruch and Gary negotiate steel for the navy — Wilson demands reasonable prices — Legge, Replogle, and Summers lay a foundation — The Board threatens to seize the steel plants — An historic meeting follows — Analysis of price elements — Production drops — Replogle repeatedly summons producers —- Master- ing the facts of steel — Baruch demands a show-down — The crisis is met • — Details of the Steel Administration. II. The automobile industry fights control — The Board and the industry meet — The industry denounces: Baruch, Replogle, et al.y reply — A steno- graphic report — Legge states a desperate case — The Board takes a per- emptory stand — A great industry pleads for its life — The final agreement. ni. The steel industry's contribution to the war — The Federal adminis- tration of steel appraised. 315 CHAPTER XIX THE STORY OF COPPER, BRASS, AND OTHER NON-FERROUS MUNITIONS METALS The myriad needs for copper — The copper producers fall into line — Forty-five million pounds for the army and navy — Further price agree- ments — The copper mines deliver — Brass for the merchant ships and navy — Zinc — ^uminum at the Government's price — Antimony for shrapnel bullets — Lead — Nickel — Quicksilver. 345 CHAPTER XX PLATINUM AND TIN I. Smuggling platinum from Bolshevik Russia — Bartering with the Brit- ish for tin. II. Where the world's tin is — Tin and the "ring merchants" of London — Driving down the price and saving millions — Tin cans and the eco- nomics of war — Tin for bombs, fuses, and flares — A moral to be drawn. III. Platinum the indispensable — Twenty thousand ounces under ambas- sadorial seal — Requisitioning platinum, iridium, and palladium. . . . 364 CONTENTS XV CHAPTER XXI FERRO-ALLOYS AND WAR MINERALS The steel industry jeopardized — Manganese and the lost collier Cyclops — Sailing vessels bring chrome metal from Rhodesia — Basic policies of raw materials procurement — Their operation vital to national defense — Tung- sten and vanadium — Henry Ford, Baruch, and zirconium — Other precious minerals :.:.:.: 376 CHAPTER XXII THE WAR IN THE NITRATES AND POTASH SECTOR The vital need for nitrates — Why Von Spee sought Craddock's squadron — America ignores lack of nitrates — In the war, and no nitrate reserves — Baruch and Summers take bold steps — The navy intercepts a message to Berlin — Baruch and Summers beat down the price — Securing control of Chilean sources — Nitrate shortage a constant specter of defeat — Devel- oping potash from brine — Potash for powder, optical glass, and gas- masks — Ogden Armour asks McDowell a question — The nitrate lesson — Have we learned it? , , 387 CHAPTER XXIII EXPLOSIVES AND CHEMICAL WARFARE Chemical action in modem war — The Board takes control of sulphur pro- duction—Five hundred thousand tons of sulphuric acid monthly attained — Nitric acid, caustic soda, chlorine — The mighty cotton linter — The role of alcohol — Summers warns of the T.N.T. need, and the army learns a lesson — Our powder on the Western Front — America's explosive prob- lem and programme — The plant at Muscle Shoals — Pershing cables imperatively — The Board protests the Du Pont contract — Baruch calls m Jacklmg — What civilian experts did in producing smokeless powder. . 397 CHAPTER XXIV ARTIFICIAL DYES: THEIR CRITICAL RELATION TO THE WAR -OTHER CHEMICAL AND AUXILIARY MINERALS The wonders of synthetic chemistry — We develop a dye industry — Driv- *V^u"^ i*^^*^°^ ^^^ phenol production — Sulphide of soda for olive-drab cloth — Acetone for aircraft dope and high explosives — Substitutions and adaptations — A mosaic of brilliant chemical and commercial eflfort. . . 412 CHAPTER XXV THE FORESTS DO THEIR BIT: LIKEWISE THE PITS AND QUARRIES Mobilizing the lumbermen — Edgar meets an emergency — Lumber for the cantonments — Pershing calls for timber; the forests answer — Filling demands unforeseen and gigantic: warehouses, docks, construction in * ranee, wooden ships, aircraft, hospitals — Agreeing on prices — Curtailing news print — Building materials " *- e xvi CONTENTS CHAPTER XXVI LEATHER AND RUBBER GO TO WAR A million sets of harness — Fifty million pair of shoes — Regulating the shoe trade — What might have happened — Rubber an economic freak. . 432 CHAPTER XXVII WAGING WAR WITH TEXTILES Blotting out Civil War scandals — The early Rosenwald Committee — Clothing the fighting millions — The final stupendous requirements — The reign of wool — The story of "shoddy" — Mobilizing the cotton goods — Eight hundred million yards for the army — The industry falls into step — Gingham-makers produce uniforms — Cromwell cracks the whip, . . 439 CHAPTER XXVIII THE IMPLEMENTS OF WAR BEHIND THE LINES Quantity production in a machine-made war — No grinding machines, no airplanes — Reducing standardization fever — One of the industrial heart- breaks — Anchor chains for merchant ships 452 CHAPTER XXIX POWER AND TRANSPORTATION AS FIGHTING FACTORS The power-fuel problem — Conserving electrical power in congested centers — The riddle of steam turbines — Automotive engineers in the war game — Creating the heavy-duty truck — Nine thousand locomotives demanded. 459 CHAPTER XXX THEY ALSO FOUGHT Begging, borrowing, commandeering optical glass — A new-bom industry — Surgical needles, aspirin, artificial eyes, and soldiers' beds — Tobacco for the doughboy — Saluting the commodity sections 470 CHAPTER XXXI APPRAISAL — WITH A FEW COMMENTS ON PUBLIC ADMINISTRATION The unsung men in mufti — Dropping the reins of power — Democracy and decision joined — Private life versus public life — A panorama of the task and the achievement — The philosophy of priority — The trend toward general control — The Board reaches its zenith — Lessons for another war — Industrial aftermath — Industrial strategy, in war and peace — The curtain rings down — The Board becomes history — Its organism in perspective — Industrial democracy vindicated 475 CONTENTS xvii APPENDICES I. Section 2 of the Army Appropriation Act, approved August 29, 1916. 491 XL The Overman Act 493 III. Committees under and cooperating with Mr. Baruch, in his capacity of member of the Advisory Commission of the Council of National Defense : . : . : . : 495 IV. The War Industries Board, with its main divisions 501 V. Regional Advisors 508 VI. Members of the War Industries Organization 509 Vn. War Service Committees of the Chamber of Commerce of the United States, and members thereof 532 Index :.:.:.:.: 545 ILLUSTRATIONS The General Staff of American Industry in the World War: The United States War Industries Board in Ses- sion Frontispiece The United States Council of National Defense and Its Advisory Commission in Joint Meeting in the Great Anteroom of the Secretary of War, Spring of 1917 16 Major-Gen. George W. Goethals 36 Member of the War Industries Board representing the Army Rear-Admiral Frank F. Fletcher 36 Member of the War Industries Board representing the Navy Brig.-Gen. Palmer E. Pierce 36 Representing the Army in the early organization of the War Indus- tries Board Bernard M. Baruch Chairman of the War Industries Board Daniel Willard Chairman of the Advisory Commission of the Council of National Defense and the second Chairman of the War Industries Board Frank A. Scott The first Chairman of the War Industries Board Samuel Gompers Member of the Advisory Conmiission of the Council of National De- fense representing Labor Robert S. Lovett Member of the War Industries Board in its early organization Alexander Legge Vice-chairman of the War Industries Board, Manager of the Allied Purchasing Commission, etc. George N. Peek Member of the War Industries Board and its Commissioner of Fin- ished Products J. Leonard Replogle Member of the War Industries Board and Director of Steel Supply 66 80 80 80 80 84 88 88 tmmami Mto XX ILLUSTRATIONS Edwin B. Parker Member of the War Industries Board and Priorities Commissioner Leland L. Summers Technical Advisor to the War Industries Board and Chairman of the Foreign Mission The " War Cabinet " Price-fixing Committee of the War Industries Board Conservation Division of the War Industries Board 88 92 128 168 210 Finished Products Division of the War Industries Board 240 Albert C. Bitchie General Counsel of the War Industries Board 266 266 266 Hugh Frayne Member of the War Industries Board representing Labor BoBERT S. Brookings Member of the War Industries Board and Chairman of its Price-fix- ing Committee Electrical and Power Equipment Section of the War Industries Board, Washington, November 11, 1918 306 Chemical Division of the War Industries Board 394 Building Materials Division of the War Industries Board 430 V INTRODUCTION Here is a good and useful book. There is no better school for nations than the school of truth, and it is never too early to lead them to it. The industrial history of the war has never yet been written. To it, Mr. Grosvenor B. Clarkson makes a first and most authoritative contribution. It is cer- tain that no one of the victorious armies could have con- quered but for the support of its industries. It is no less clear that no European industry could have survived but for the support of American industry. All of us, without exception, make mistakes. Had we been better prepared for war, victory would have come sooner and cost less. As to military preparedness, our army was magnificent and admirably trained. But there was another kind of preparedness which had everywhere been neglected, that of the productive forces essential to the existence of the soldiers. One of the prime movers of American industrial mobilization spoke the truth when he said that "twentieth- century warfare demands that the blood of the soldier must be mingled with from three to five parts of the sweat of the man in the factories, mills, mines, and fields of the nation in arms." Germany, which, living only for the war, under- stood its requirements better than we did, had to pay dearly for unpreparedness. In the first quarter of 1915, she passed through a munitions crisis which was not far from being fatal. America, despite the power of her production, only escaped the common danger by the magnificent effort of which Mr. Clarkson tells the story. As he so rightly says, America was the "last reservoir." We in Europe, when we lacked steel or high explosives, had only her to turn to. She, however, was obliged to find everything within herself, to meet her own requirements and satisfy the demands of her allies. The competition of European and American needs was our constant anxiety. To cope with the danger, there was but XXll INTRODUCTION one hope : strong and constructive organization. Is there any need to add that in a nation of individualists like the United States such organization met with strong opposition from the very first? It will be the imperishable glory of President Wilson, Mr. Bernard M. Baruch, and their distinguished co-workers, that they were able to create it, as much by their convincing persuasiveness as by the exercise of unbending authority. The cables of my friend Andre Tardieu, who for two long years was responsible for the French side of Franco-American cooperation, had, from the beginning of the struggle, brought home to me the immense complexity of the difficulties encountered, the efforts made, and the results obtained. It is right, now that victory has been won, that history should speak through a book at once clear, interesting, and full of proof. The United States declared war in April, 1917. It was only in March, 1918, that their industrial mobilization found its final form. Even in the land of quick decisions, the routine of peace days struggled hard to live. But the High Command of Industry was created. It was a splendid com- pany of men who at the call of their country had come from all parts of the United States. It had no congressional birth certificate; a mere decision of the President, and in a few weeks resources were perfectly adapted to needs, the whole coordinated by the War Industries Board, which was supreme in all matters of production, priority, and distribution. It was really, according to Mr. Clarkson's forceful expression, nationally integrated industry. Production, priority, distribution, was no easy task, and often strange and dramatic problems called for solution. To give but one instance: What was to be done with the lot of locomotives just ready for delivery? Were they to be sent to Pershing to carry his troops to the front, or were they to be sent to Chile to hasten the delivery of nitrates without which to-morrow the artillery would be dumb? This book bears witness to what America achieved. Who- ever reads it will know. But, leader of fighting France, I have a duty to fulfill. It is to recall here what in those immortal days the United States did for my country. That, too, would be worth a book, which has so far not yet been INTRODUCTION XXlll .^ ^) written. Meanwhile, here are some eloquent figures. In eighteen months, the United States sent us five million tons of food supplies and five million tons of war material. The steel they sent us represented the raw material for a hundred and sixty million "75" shells. The foodstuffs they sent us fed twelve million Frenchmen for a year and a half. If this help had not been forthcoming, our army could not have held, the army of the United States could not have fought. Mr. Clarkson is right: the men who won the war behind the lines — on which victory at the front depended — are entitled to the gratitude of the nations, and the nations do not even know their names. It is time that justice should be done these men, and this book hastens that day. We French- men, who are eternally thankful, despite the troublous times through which we have lately passed, to our good comrades in arms from beyond the seas, remember with gratitude the organizers of the industrial victory, who made military vic- tory possible. They have modestly gone back to their offices and factories, with the sole reward of duty well done. Let them receive our cordial thanks; they have deserved well of the Allied and Associated Nations. G. Clemenceau Paris, 13 December, 1922. INDUSTRIAL AMEMCA IN THE WORLD WAR !' :^a£Z&i£^A&S uiSBsaiia£ii^r> Industrial America in the World War ... I advise that the Congress declare the recent course of the Imperial German Government to be in fact nothing less than war against the Govern- ment and people of the United States; that it formally accept the status of belligerent which has thus been thrust upon it and that it take immediate steps, not only to put the country in a more thorough state of defense, but also to exert all its power and employ all its resources to bring the Government of the German Empire to terms and end the war. . . . WooDRow Wilson War Message to Congress, 2 April, 1917 Modem wars are not won by mere numbers. They are not won by mere enthusiasm. They are not won by mere national spirit. They are won by the scientific conduct of war, the scientific application of industrial forces. WooDRow Wilson Modem wars make terrible demands upon those who fight. To an infinitely greater degree than ever before, the outcome depends upon long preparation in advance, and upon the skillful and unified use of the nation's entire social and industrial no less than military power. Theodore Roosevelt When this war comes to be reviewed in proper perspective, its social and economic aspects will be found at least as remarkable as the military events, and perhaps more instructive. And among them, the influence of war on industry and the converse influence of industry on war will take a prominent place. We are, indeed, witnessing a phenomenon so extraordinary and unex- pected that we can only see its surface as we pass, and are hardly able to comprehend even that. There has not been time to look beneath and try to read the deeper meaning of it all. But some lessons present themselves which he who runs may read. Never before has the supreme concerted effort demanded by war been so fully brought out and the inscrutable mystery of human conduct been so clearly posed as in this prodigious conflict of indus- trial nations. Shadwell Foreword to Readings in the Economics of War. The University of Chicago Press, 1918. 1 CHAPTER I THE CRISIS AND HOW IT WAS MET The inexorable demands of modern war — A contest of peoples and industries as well as of armies — America the last reservoir of resources — The untold tale of the war — The Nation's inertia before the storm — Staging the huge industrial drama — Approximating autocracy. War is no longer a phenomenon to which the military alone are called. It is no longer chiefly a pageant of marching troops and tragic fields. War to-day is a contest of all the powers of the antagonists — intellectual, moral, and indus- trial. To the romance of armed men moving upon the stage of history has been joined the drama of industry militant, of titanic economic forces loosed and then governed to the need of the nation in arms. America sent oversea the last reserves of men. That was well and superbly done. But it would have been merely a magnificent gesture if America had not been the last reser- voir of resources for the supply not only of herself but of the Allies. The story of our changing and growing military pro- gramme and strength has been told by others, but the account of the industrial mobilization for war of an unwarlike, unpre- pared, and undisciplined people remains for this book. It is the untold tale of the war. It is the record of how all the people and all their activities were drafted quite as importantly as were the four million youths who wore the uniform of the Republic. It is a narrative of the gradual and unflinching conscrip- tion of the whole population for the manifold activities of modern war. It is a story of the conversion of a hundred million com- batively individualistic people into a vast cooperative effort in which the good of the unit was sacrificed to the good of 4 INDUSTRIAL AMERICA IN THE WORLD WAR the whole, and of how the entire industrial power and machinery of the Nation were focused on war ends. Through the draft the army imperatively called to the colors the physically fit of the land. Through the War Industries Board, in embryo, in full form and vigor, and through its ever-growing and controlling ramifications with other war agencies, the whole productive capacity — even the whole civil life — of the Nation was just as certainly, if less imperatively, summoned to the ordeal. At the head of the army in arms was the General Staff; at the head of the armies of industry was the War Industries Board. So unobtrusively and so unconsciously did this powerful agency grow with doing, so naturally did it emerge with the environment, that it was never dignified with an organic act by Congress. The greatest exercise of national authority as applied universally and individually was entrusted to an instrumentality that was virtually unknown to the statutes, and it was not until the war had been over for some months that an investigating Congress began to understand some- thing of the nature of the mechanism that in the end directed the sweeping appropriation of the commerce and industry of the most powerful of all nations more effectively and less timorously dian like functions had been performed in the military nations of Europe. It is of record that the reports of our military observers with the armies of the belligerents in Europe lay unread in the archives of the General Staflf up to the time of our own entry into the World War. Funds had not been provided to furnish the military intelligence service with enough person- nel to examine what little it was able to collect. As an organization our army had not been equipped to study the greatest of wars going on beneath its eyes. The cadets at West Point were still absorbing Jomini and Clausewitz, and the eyes of the General Staff were on the trivial Mexican Border, whilst the fate of the world was turning on the intro- duction of novel implements of war and unprecedented phenomena involved in a struggle that had become one of whole populations pitted against each other with the massed resources and facilities of peoples. ' THE CRISIS AND HOW IT WAS MET 5 For at least two years we had been almost daily on the verge of being drawn into the war, but we had learned nothing from its military lessons in the narrow sense, and even less in the important sense of war as a conflict of nations. It is futile to attempt to place the blame for this lethargy in any other than the ultimate quarter of our confirmed and sentimental pacifism. Always believing that we shall have no wars, we have gone on having them without preparation ever since the war that founded the Republic. Even the upbuilding of the navy we have used as an excuse for no further preparation — saying that no war will ever be fought on our soil and that we shall never have need to fight overseas. That theorem has been demonstrated over and over again to the satisfaction of our stubborn devotion to peace; and is even now being explained to applauding audiences, though scarce four years have passed since we had two million fighting men in Europe. Whether or not we have learned from our violent experi- ence in the World War anything that will tend to make the trials of some future war less violent is an interesting field for dubious speculation, but, whatever may be the con- clusion, it cannot divert interest from the history of what we did when war became an actuality and we had to suspend our absorption in pacifism to deal with a war that came despite our determination that it should not be. Even if we had been a military people, we should never have grasped the universal involvements of modern war until we were actually in it. Germany alone among the nations had long ago seized in a powerful degree upon the idea that the army is but the sword of the nation, as ineffec- tive in itself as a simple sword without a wielder. France was fully imbued with the conception of a nation in arms, but ) ad not accepted its industrial implications. England was as laggard as we were when her hour struck. Yet even Germany did not understand the full significance of a war of peoples. It is perhaps true even of her that she anticipated everything but what ultimately happened. She had long coordinated her internal life to the foreseen require- ments of armies of unprecedented magnitude and fully understood the sequences of huge military efforts in the I y 6 INDUSTRIAL AMERICA IN THE WORLD WAR industrial field, and conversely of the effects of industrial mobilization on military enterprises on the modem scale; but even she came short in her calculations as to the require- ments of her armies from her industries and failed in foresight for civilian needs. Notwithstanding forty years of deliberate planning, she found herself improvising, reorganizing, and frantically starting to restore the disturbed balance as early as the first battle of the Marne. For almost three years of the World War, our allies to be were so far from fully grasping the nature of the struggle that they were at first as uncertain as we were as to what should be our part in it. They hesitated as to whether we should be the store-house and power-house of the line or whether we should take a place in the line itself. It soon developed that we should have to play both parts, though not until the spring of 1918 did it become evident that in both soldier-power and material-power we should be com- pelled to play a large and decisive role. Owing to our lack of preparation as well as to the partic- ularistic attitude of our industries, partly due to the peculiar- ities of the American genius and partly to the operation of statutes that discouraged alliances of industrial units, the United States faced a very difficult task, even if it had been undertaken deliberately and long in advance of the emergency. There was no close cooperation in industry and no effective mingling of the national power with the industrial power. The American policy had been to repress interlocking industrial organization rather than to control it. Trusts had been broken up and the tendency of the rail- ways to unite had been vigorously opposed. All contacts of productive units were discouraged. There was an almost grotesque lack of centralized information concerning resources and facilities, and, of course, no prepared plan for devoting them to a struggle in which the military arms and the Nation itself were not to be distinguished. Even had there been an orderly and quickly available inventory of industrial power, there was no schedule of requirements against which to balance it. The measure of the application of our military and industrial power to the combat in Europe was the capacity of ocean transport, and that was an unknown I THE CRISIS AND HOW IT WAS MET 7 quantity. Moreover, the length of this line of supply necessitated the accumulation of far greater reserves than was the case with Germany, England, and France, which were in the theater of war. The transoceanic conduit must be filled and then kept full. Our task was further complicated by the fact that we did not have the single problem of mobilizing our latent power into the power of arms backed by all the resources of the Nation. We were the last reservoir of energy and materials available to the Allies. Speaking in a broad way, we could not go elsewhere to obtain the things not immediately avail- able at home. We had to find or produce them here without interfering with the flow of supplies to the Allies without which they would have been compelled to abandon the great struggle before we entered it. Not only that, but we had to attend to the enormous task of financing domestically our whole war enterprise and that part of the Allies' activities which depended upon American resources. Upon us devolved the herculean work not only of meeting the special military requirements of ourselves and our allies, but of meeting the large alimentary deficits of the allied world and to some extent of the neutrals, besides seeing to it that our own people were adequately fed, fueled, and clothed. Our problem of industrial mobilization and application was thus vaster and more complex than that of any of the other nations at war. And it was thrust upon a people less prepared, by tradition, training, economic struc- ture, political organization and control, and by forethought, to undertake it than was any other. Even had all these elements been favorable, even had we already a large standing army well articulated to the "second line of defense," the vast area of the country, the long distances over which materials had to be moved in the process of preparation and for shipment to Europe, provided particular phases of the problem most difficult of solution. It is probable that no previously conceived and worked-out paper organization would have been able to meet a situation so novel and so permeating the whole life of the Nation, with incidence and repercussion not to be foreseen. It is even possible that such a preconceived organization might I 8 INDUSTRIAL AMERICA IN THE WORLD WAR have failed as much from its rigidity and formalism as our lack of system failed us at first. It may even be that had we created, immediately upon our entry into the war, a department of munitions or its equiv- alent, it would have been too angular and inelastic success- fully to meet the emergency, too autocratic for the liking of the country and of business, and far less adaptable and responsive to the facts of an ever-changing situation than the natural growth — the War Industries Board — which finally came to be the supreme instrumentality of the exertion and application of the power for war of the most powerful nation of all. There was an insistent demand for the establishment of a department of munitions, and it will long be an open question whether such a course would have been wiser than die one that was defined by the tread of events. However, we are now concerned with history rather than with criticism. In the end the Republic met its problem — and effectively — through an institution that admirably complemented the genius of our people for the inductive method of thought and action. On the whole, we learn by doing instead of doing by learning. We act first and consider afterwards. Lack of plan in no way interfered with energetic action when the war began. We plunged furiously into activity. Congress appropriated stupendous sums of money on the merest guesses as to requirements, inflated war establishments gave orders as fast as duplicating machines could copy them and telephone and telegraph transmit them. We struck blindly, we became enmeshed in our own complex web of activities, we stumbled and fell. And then, around a little nucleus of observation and reflection in the Council of National Defense that had sought to think, plan, and foresee from the late part of 1916, the lessons of experience were gradually deposited, and there grew up solidly and adapta- tively, finding final expression in the War Industries Board, a war machine that was our own and that articulated with the decentralization that characterizes the Republic, economically and politically, and that fitted like a glove the national devotion to individualism. While the critics were still crying the need of system, the f THE CRISIS AND HOW IT WAS MET 9 system was evolving; and when coordination was still a sweet word to mouth in the way of advice, the manifold and inconceivably complex and interpenetrating demands and functions of war had been subdued, tamed, and harnessed in an efficient team. Through a fabric of reflex actions, responding to the multitudinous war stimuli, tempered by observation and thought, our war machine grew. Doubtless there might have been a better one, but this one did the job. It roped the wild horses of American economic and political tradition and habit and tied them into a mechanism of pur- poseful control that was not surpassed by the superimposed systems with which the Allies met the crisis of confronting for the first time in the history of the world a nation that was an army from the military front to the remoteness of the fields. Through it the huge, imwieldy, easy-going, individ- ualistic, careless Colossus of the North became an army from its coasts to its placid farms, and learned to put into its blow the whole weight of its incomparable strength. So gradual was the growth of this mechanism, so gently did it apply its powers, so lacking was the authoritative definition of them, so frequently did it request and so rarely did it command, so human were its engineers, so careful to protect the essential framework of the national economic strength while straining it to the utmost, so little was the emphasis of boastful publicity used, that but few of our people understand even now that the end of the war found the United States as complete a military machine throughout its whole industrial and economic life as the world has ever seen. CHAPTER II THE COUNCIL OF NATIONAL DEFENSE AND ITS ANTECEDENTS Preparedness in a democracy — The roots of industrial defense — The Council's birth — Early gropings — First contacts with industry — The cry for concentrated power — The mass begins to move. The United States was unprepared for the World War in a governmental and military sense, but there had long been a ferment of preparation stirring among the non-official leaders. There is in this country a singular divorce at times between the public opinion and will and the acts of the Congress. Perhaps the divorce is more apparent than real, and that what we commonly call public opinion because it is so articulate is not the real opinion of the Nation. At any rate, it has happened time and again that Congress has been obdurate to the appeals of the public as reflected by the views of the metropolitan press and symposiums of opinions of what we call the best minds. Judged by these indicia — and no historian should accept them without great reservation — it was the will of the people from 1914 on that the Nation should prepare for war. Yet it was not until 1916 that the Government felt justified in showing an active interest in military preparedness. Even in that year Congress thought that an army of two hundred thousand was enough. It is a fair conclusion that the divorce between con- gressional action and public opinion is only between the former and apparent public opinion. Usually this apparent opinion eventually becomes the actual opinion — but a long time afterwards. After all, the controlling motive of most Congressmen is to shape their records to win the approval of their home people. Hence they watch their local public opinion most intently, and on any deliberately considered legislation are likely to represent the mass mind of the country. Public opinion in New York, in Chicago, in Washington, 3 THE COUNCIL OF NATIONAL DEFENSE 11 in the Capitol itself, and the public opinion of the Nation are two different things. We are a sprawled-out, decen- tralized nation, spread thinly over a continent, with the bulk of civil lawmaking and administration in the hands of local bodies. To the home districts State capitals usually loom larger than Washington and a county-seat fight is apt to be of more interest than a war in Europe. Under these con- ditions public opinion on national matters breaks up and recrystallizes slowly. When the provincial public mind is once made up, it tends to stay. It is not mobile. The Federal democracy follows its leaders at a distance. These leaders are not, as a rule, in Congress or in Government. Government depending upon popularity for its power seeks to follow rather than lead public opinion. So, with war threatening for many years and impending for several, with the intelligently keen part of public opinion favoring preparedness and taking volunteer and non-official steps in that direction, we find little official action. While the agitation for action was largely fruitless in the immediate view, it had a great significance in that it did awaken thoughtful men everywhere to view the future with concern and to consider what could and should be done. By reason of this long impotent activity of minority opinion, the Nation was readier for heroic action when the time for preparedness had passed and that for action had come. It had glimpsed the stupendous scale of modem warfare and its intimate union with the whole life of the Nation, and so was in some measure ready to rally around the Council of National Defense as nucleus for the evolution of the supply machinery of the army and navy, which it was already vaguely under- stood meant the whole economic mechanism of the Nation. As far back as 1910 the idea of a Council of National Defense had begun to take root in the minds of men who perceived how helpless the country would be in the event of war, for lack of forethought and planning, and General Leonard Wood and other army men were emphasizing the need even before that of more extensive military system. As long ago as 1902, General Crozier, as chief of the Ordnance Bureau, had urged the wisdom of a great enlarge- ment of the artillery arm. Had the advice of the officers 12 INDUSTRIAL AMERICA IN THE WORLD WAR been taken, and had the Government set about to plan for the expansion of the peace-time forces into an army of the size that was contemplated in Europe even before the revelations of the World War, the corollaries of such a course would have led to a large degree of industrial preparedness, though, as we now know, almost grotesquely inadequate. It really required a year's observation of the war in Europe for an understanding of the fact that modern wars are fought, not by armies, but by nations, and that the whole moral, spiritual, and physical energy of the Nation must be sum- moned to the struggle. In the latter part of 1915 there began to be many popular manifestations of a tendency toward military and industrial preparedness, and many associations began to take form that had as their objectives some phase of preparedness. General Wood's "Plattsburgh plan" for training officers caught the imagination of the country and was later embodied in law. It is perhaps significant to note that the head of the war agency with which this volume deals was an early financial supporter of this plan. All of the volunteer striving toward war preparation had at least a moral value in that they were preparing the mind of the Nation to face the war that was coming. One of them, at least, had a moral value, and that was the Industrial Preparedness Committee of the Naval Consulting Board. The first stirrings of the feeling of apprehension that we might be engulfed in the World War had their immediate reflexes in the naval establishment. It was obviously the first line of defense, and it was hard to conceive of any war that would require us to send large armies overseas. More- over, for thirty years the public had become accustomed to an expanding navy and mounting appropriations for naval ships and establishments. So, in 1915, President Wilson unequivocally declared for a navy second to none, and there was laid down the ambitious building programme of 1916 which pointed to supremacy for the American navy. The extensive industrial involvements of this programme were obvious. With Edison at its head, the Naval Consulting Board, created to deal with them, consisted of two members each from eleven of the great scientific societies of America. I* THE COUNCIL OF NATIONAL DEFENSE 13 Responding to the growing apprehensions of the hour, this Board soon concentrated its important activity in the Com- mittee on Industrial Preparedness, which extended the scope of its work to include industrial preparedness as viewed from the whole military requirement, not that of the navy only. Although acting under helpful public auspices and with the emphatic approval of the President, the Industrial Preparedness Committee was virtually a popular rather than a governmental organization. It was almost wholly financed by private contributions. The chief work of the committee, under the chairmanship of Howard E. Coffin, of Detroit, was to make an inventory of manufacturing plants of the country that were capable of making munitions. The State committees, hand-picked from the joint member- ship in each State of the five leading engineering bodies of the country, took up the work with vigor and enthusiasm, and the enterprise proceeded so rapidly that by September, 1916, some twenty thousand manufacturing plants had supplied data bearing on their war service capabilities. This canvass revealed a very general feeling on the part of manufacturers that America would be drawn into the World War. They sensed the strain that would be put upon the country's industries and (doubtless in some cases stimulated as the result of Allied contracts) cheerfully cooperated in the census of preparedness. Yet it must be noted tliat there were a few exceptions. Some concerns refused to give the desired information, and curtly stated that they cared for no governmental patronage either in war or in peace. This exceptional attitude revealed a considerable lack, in the year before the war, of that unity of will to serve the Nation that was essential to the fusing of the fagots of individualism into the unbreakable bundle of national unity. Whatever may have been the value of the committee's industrial inventory, to Mr. Cofiin, more than any other individual, is due the evocation of the pre-war movement for industrial preparedness, so far as its popular aspect was concerned. He gave his time, energy, and resources with- out stint. He was filled with the consciousness of the pre- ponderant role of industry in modem warfare, expressed in his phrase: "Twentieth century warfare demands that the 14 INDUSTRIAL AMERICA IN THE WORLD WAR blood of the soldier must be mingled with from three to five parts of the sweat of the man in the factories, mills, mmes, and fields of the nation in arms." The information collected by this private endeavor to fill the gap that Congress had long ignored was later trans- ferred to the Council of National Defense and War Industries Board — the latter expanding the inventory threefold; but still more important was the awakening of the men of industry and the thoughtful citizenry that resulted from the canvass and the knowledge of the importance of the articula- tion of arms and industry in modem war that was widely disseminated. The phrase "industrial preparedness" was bom of this campaign. The press of the Nation gave many thousand columns of space to the committee's work durmg the summer of 1916. Magazine editors like Albert Shaw, of the "Review of Reviews," daily newspaper executives like George McAneny, of the "New York Times," made themselves one with the movement. The billboards gratuitously blazoned the idea, and such powerful national organizations as the Associated Advertising Clubs of the World and the American Press Association contributed generously of their talent and experience, as did a number of the leading artists of the country. In no small measure was the ground thus prepared for the seed that was to be so vigorously planted in the following year. The feeling for industrial preparedness that was fostered undoubtedly had its effect in Congress when, in the spring of 1916, bills were again introduced into the House and Senate for the creation of a Council of National Defense. The idea was now in the air. The President, now become an ardent advocate of preparedness, had made a swing around the circle to promote the enlarged naval and military pro- grammes, and the people, realizing how near war came after the sinking of the Lusitania and again after that of the Sussex, understood that some new incident might precipitate it almost any day. The German intrigues for the support of pacifism and for the destruction of munitions plants stirred national resentment, and helped, as did much of Germany's policy, to contribute to her undoing. Yet, even now, so pacific was the Congress that the section of the * THE COUNCIL OF NATIONAL DEFENSE 15 Military Appropriations Act creating the Council of National Defense was drawn with a view rather to leisurely industrial preparation for some far-off emergency, and the trifling sum of $200,000 was the amount held sufficient for a beginning. Under consideration in Congress for near six months, the plan became law only of August, 1916, and it was not until December 6th that the Advisory Commission of the Council held its first meeting. Many men and many currents of thought contributed to this first enactment of a measure designed to enlist the economic forces of the country for some distant emergency. The apical effective touch was apparently given by Dr. Hollis Godfrey, president of the Drexel Institute of Philadelphia, and Dr. Henry E. Crampton, an eminent scientific man, who as thoughtful citizens sought an analogy between corporate coordination and the coordination of the political power and the industrial strength in an emergency that would demand their closest union. Dr. Godfrey states^ that the sources of his thought on this subject had their origin in a trip abroad in 1906 during which he met Sir Henry Campbell-Bannerman and Mr. Winston Churchill, who were then "working on a council of imperial defense" for Great Britain. He watched with interest the course of the Hobson proposals in Congress for a Council of National Defense, and then in May, 1916, made up his mind that he must do something to promote the idea of management of industry in relation to war, for the purpose, as he put it, of getting "product and service at a minimum of cost and time." He conferred with General Leonard Wood. "Three cheers; this is exactly what we need," was the comment of the great proponent for 'military preparedness in the United States. "There is nothing that is more necessary." In several conferences with General Wood, the whole preliminary plan was worked out, and General Wood recommended that Dr. Godfrey confer with Secretary of War Garrison. Before calling on Secretary Garrison, how- ever, Dr. Godfrey conferred with Secretary of Commerce ^Testimony before Select Committee on Expenditures in the War Depart- ment, Serial 3, Part 15, October 20, 1919. 16 INDUSTRIAL AMERICA IN THE WORLD WAR Redfield and Dr. Crampton, and there resulted a working model of the Council of National Defense. When the plan was submitted to Mr. Garrison, he said, "This is the most amazing baby that was ever put on the War Department steps; I am going to shut everything else off and talk to you the rest of the day." After many other consul- tations the project was submitted to Elihu Root, former Secretary of War, who examined existing statutes and informed Mr. Garrison that there was no existing organ of Government that could carry out the plan, and then "outlined the bill which afterwards formed the fundamental principles of the bill." The next step was the submission of the basic bill to Representative Sanford, of New York, and then to Senator Weeks. Senator Chamberlain, chairman of the Senate Committee on Military Affairs, and Representative Hay, chairman of the House Committee on Military Affairs, gave earnest attention to the project. Colonel House reviewed it with valuable results and then the plan was laid before President Wilson, who said: "This is admirable; this is extraordinary, this composite work. It is exactly the putting of this theory of education into government. I am heartily for it." Secretary of War Baker was consulted frequently by Crampton and Godfrey and he agreed with the whole situation. The provisions of the Army Appropriations Act creating the Council of National Defense were drawn by Major- General Crowder acting under instructions from Mr. Baker. The first draft was brought to the Secretary, changed by him in several ways, then restudied and redrawn by General Crow- der, and in its final form was the result of further confer- ences between General Crowder and Mr. Baker. The original basic blue-print work in connection with the Council was apparently done by Dr. Crampton and his staff. It should be said that in the course of his thinking and planning Dr. Crampton received the views of such men as Benjamin Strong, governor of the Federal Reserve Bank at New York; Nicholas Murray Butler, president of Columbia University, and Elihu Root. In view of later critical discussion, it is significant that Dr. Godfrey testifies that it was Mr. Root's 2- O o o OS O o M « < 2S ^ > Q < GQ H Q o < H ;z: Q < I? O M H o M u 12; P o xn < CO W w o o o as H < < « O H M o !2: 'I ffl 5 Q & gcc t ° ■^^ % ffl ^ s 3 A -- O ■a * -S ^ Ik o c c Cm a o rs v £ s §j c o M "-^ U "a; -^ ^ c o c », * ^■ 3 0) Q a g ^' - ^ 1-9 0) w .- fl s. 3 * g .2 £3 « <; 13 c n b .2 > 73 •< ^ « hi « a a o O u 03 O a 3 O C c c 8J O 02 O o So 2 73 85 "C S S .t: 3 83 o ^O O ^ . o "^ I, — • a o •-3 ■** g O ^ S OS •^ DQ (-J ^^ 73 f^ u .. 04 c c tn 0) o PQ O g I OD 2 O O P4K >> hi O .2 5 2 ea § CO +3 73 C 03 3 . V u ^ % I i INTENTIONAL SECOND EXPOSURE 16 INDUSTRIAL AMERICA IN THE WORLD WAR Redfield and Dr. Crampton, and there resulted a working model of the Council of National Defense. When the plan was submitted to Mr. Garrison, he said, "This is the most amazing baby that was ever put on the War Department steps; I am going to shut everything else off and talk to you the rest of the day." After many other consul- tations the project was submitted to Elihu Root, former Secretary of War, who examined existing statutes and informed Mr. Garrison that there was no existing organ of Government that could carry out the plan, and then "outlined the bill which afterwards formed the fundamental principles of the bill." The next step was the submission of the basic bill to Representative Sanford, of New York, and then to Senator Weeks. Senator Chamberlain, chairman of the Senate Committee on Military Affairs, and Representative Hay, chairman of the House Committee on Military Affairs, gave earnest attention to the project. Colonel House reviewed it with valuable results and then the plan was laid before President Wilson, who said: "This is admirable; this is extraordinary, this composite work. It is exactly the putting of this theory of education into government. I am heartily for it." Secretary of War Baker was consulted frequently by Crampton and Godfrey and he agreed with the whole situation. The provisions of the Army Appropriations Act creating the Council of National Defense were drawn by Major- General Crowder acting under instructions from Mr. Baker. The first draft was brought to the Secretary, changed by him in several ways, then restudied and redrawn by General Crow- der, and in its final form was the result of further confer- ences between General Crowder and Mr. Baker. The original basic blue-print work in connection with the Council was apparently done by Dr. Crampton and his staff. It should be said that in the course of his thinking and planning Dr. Crampton received the views of such men as Benjamin Strong, governor of the Federal Reserve Bank at New York; Nicholas Murray Butler, president of Columbia University, and Elihu Root. In view of later critical discussion, it is significant that Dr. Godfrey testifies that it was Mr. Root's i 41 35 o t— t 3 >> •-9 T3 • - O •«• en v u ;= v jf S i,^ o a o s •s o < GC H Q O X < H o a O -^ la ~ ~ "^ .2 = c " .£ -r tti i. '^ ^ D S O X ^ O JO ,C O o c Q C.2 .2 g 60 •-> — H- fc, CO C C O C '3 5 83 Q GO 3 w Q < O < o P o < a: b ^ IS S ^. « 0. C3 >. 3^ . b U ._ - - « < -a c ^i^ u » o o o MM H 25 O HH -. '-i -W ?3 <«. = C £ o O >. o .sa C a o O hi u 03 "2 o e - .2 § S nI '« r* OB 0, S a eS u cS •— .b 3 . o %■& c 22 o 5 ■5 >» * o « .2 ^ > .2 "^ ' as 5 o tJ 5 "H •SO o d h O 9J U a S 2-5 -M -r o ■g 2s U ■<: r< i^ p s SB l-H '^ o o -^ h :3 . -T S — o '^ w C C 03 3 . <. ■■ i THE COUNCIL OF NATIONAL DEFENSE 17 suggestion that the Council of National Defense should con- sist exclusively of certain Cabinet members. William G. McAdoo, Secretary of the Treasury, bore a distinct part in the Council's creation. He was keenly inter- ested in it. At his summer home in New Jersey, the writer discussed with him at great length, in September, 1916, the personnel of the Advisory Commission shortly to be appointed, the writer having been, with Walter S. Gifford (the first director of the Council), one of the working heads of Mr. Coffin's Committee on Industrial Preparedness. Fol- lowing this meeting the writer informed Mr. McAdoo that he could not accept the directorship of the- Council and Advisory Commission and advised the selection of Mr. Gif- ford for that post, one which held potentialities limited only by the vision, practical ability, and courage of its incumbent. (Mr. McAdoo told the writer then that he had had the Secre- tary of the Treasury as a member of the Council kept out of the act because he did not feel he could assume the additional work.) Mr. Gifford seemed to be a logical selec- tion to undertake the preliminary organization of the Coun- cil. As supervising director of Mr. Coffin's committee, he had organized and driven through the details of the work in an orderly and precise manner that was wholly admirable. He was besides possessed of considerable business experi- ence as chief statistician of the American Telephone and Telegraph Company. The Advisory Commission, which was the characteristic feature of and became the Council in action and was the essential part of its mechanism, is represented by Dr. God- frey as being "the joint growth of the entire situation; the Advisory Commission was to bring out the principle of having trained experts in diflferent lines. It had never been very effectively brought into an executive body before." It is important to note that the legislative roots of the Council of National Defense idea go back as far as 1910. In that year, in response to a resolution of the House of Representatives, the General Staff of the army submitted to the House a confidential report on the military situation which included a recommendation for the creation of a Council of National Defense, "in order to stabilize the mili- I 18 INDUSTRIAL AMERICA IN THE WORLD WAR tary policy of the United States." Even then there seemed to be an understanding in the army that there must be a body to unite the military and civil forces. Immediately after this report was received, Richmond Pearson Hobson, of the House Committee on Military Affairs, introduced a bill providing for a Council of National Defense to consist of the Secretaries of War and Navy, two technical officers each from the army and navy, and six members of Congress. This early idea that the Council should primarily unite the military arms of the Government with the Congress persisted right down to 1917. Mr. Hob- son brought his bill up again in the Sixty-Second Congress in 1912, but it never reached a final vote. The matter was considered important enough even to be included in the Democratic national platform in 1912, which had a clause expressing approval of such a body. The proposal was unavailingly renewed in the Sixty-Third Congress, and the matter was discussed in newspapers and magazines in 1913 and 1914. The outbreak of the war in Europe with its early emphasis on the industrial incidence of war shifted interest from the earlier conception of a council that would unite the army, the navy, and the Congress in a military coordinating body to one that would deal rather with the relations of the mili- tary arms to industry. Thus arose the Naval Consulting Board; the National Advisory Committee on Aeronautics, created in March, 1915; the National Research Council, cre- ated in July, 1916, both by acts of Congress, and in April of the same year the establishment of the National Com- mittee of Physicians for Medical Preparedness. The growth of interest in the industrial background of military operations was reflected also in section 120 of the National Defense Act, which gave the President the power to "place orders for war material directly with any source of supply" and also endowed him with the power to com- mandeer plants if necessary and appoint an industrial mobilization board. The same section directed the Secretary of War to cause to be made a complete list of all privately owned plants equipped to manufacture arms or munitions, etc. The power here given was intended to be used through THE COUNCIL OF NATIONAL DEFENSE 19 the War Department, but another act gave similar powers to the navy. Section 120 was worked out by the War College Division of the General Staff Corps. Preliminary to the final adoption of the section creating the Council of National Defense in the Military Appropria- tions Act of 1916, four separate bills for such a body were introduced — two by Senator Chamberlain, one by Repre- sentative Hay, and one by Representative Britten. In sub- stance Mr. Hay's bill (the Godfrey plan) was finally adopted, as it appeared to represent the more modem con- ception. Senator Chamberlain's measures inclined to the earlier tradition of a sort of fusion of the legislative and executive branches. Nevertheless, the measure as finally adopted attracted little attention from Congress as a whole, and nobody seems to have thought that there was any duplication of legislation involved in the above-mentioned paragraph of the National Defense Act, passed by the same session of Congress which authorized the President to appoint a board of industrial mobilization in his discretion. Had there been any general adequate thought given to the subject, the two measures would have been merged logically in the National Defense Act, but in fact it was the Military Appropriations Act that provided for the Council of National Defense. It is a curious f^ct that there is no record that the authorization of an agency for industrial mobilization was ever invoked by the Execu- tive, though that provision has been noted since as one of the elements that built up the extraordinary war powers of the President and supplied the sources of authority for much that was done later by the Council of National Defense and the War Industries Board. It seems entirely to have escaped the attention of those unfriendly critics who have sought to show that there was virtually no legislative foundation for the exercise of such vigorous executive power as the War Industries Board came to exercise in the fulfillment of its evolution. Necessity knows no law, as President Lincoln telegraphed to Governor Ramsey, of Minnesota, when the latter besought him to suspend the draft in Minnesota, which sparsely settled frontier commonwealth was at the moment confronted by one 20 INDUSTRIAL AMERICA IN THE WORLD WAR V III f» of the bloodiest Indian wars in our history. Congress never contemplated that the Council of National Defense and its lusty child, the later all-powerful War Industries Board, should become the partners of the army and navy in waging war, but it did sow the legislative seeds from which those bodies grew great and mighty when endowed with the vir- tually unlimited authority that the President in war-time could and did confer upon them. In any event, the evolu- tion had the tacit approval of Congress, for, though definite legislation covering the field of industrial control in connec- tion with the war enterprise was proposed, it was never adopted. Perhaps it is just as well that the instrumentality of primary industrial control was left to grow instead of being created. Being always in some measure, superficially at least, dependent on the voluntary cooperation of the people, it never aroused the deep-seated antagonism and open or passive defiance that, in a democracy, so often cripples arbi- trary and unpopular ordinances. Moreover, by reason of its indefiniteness, the system that finally met the emergency was so adaptive and fluid that it fitted into all the crannies and crevices of the war machine which was called upon to do more in two feverish years than the one Germany built with thought and care in forty deliberate years. A formal instru- mentality legislatively created ab initio might have accom- plished less by severe edicts than the War Industries Board did by its polite "requests." Edicts might have been nulli- fied, but the requests were ever cheerfully complied with. By the legislatively informal method the necessary measures were always taken by "us" instead of by "you." And there is a world of psychological philosophy in the diff'erence. It matters not that recipients of the requests for cooperation knew that behind them there was inexorable will and the means of compulsion; the request form made them feel that the sources of power and compulsion were ultimately in them as an integral part of the Nation from which the requests proceeded. The act creating the Council plainly reveals that it was intended as a peace-time body which should prepare the country for an emergency — by thought rather than by THE COUNCIL OF NATIONAL DEFENSE 21 action, by study rather than by performance. Doubtless it was expected that its recommendations should be the basis of legislation that would create instrumentalities for the purpose of realizing its plans. The war caught the new body in the formative state and wrought it by the imperious force of events and the white heat of necessity into an executive agency. Instead of planning the initial mobilization of industry and resources, it directed the mobilization. Instead of sitting serenely apart in a deliberate council chamber, it was thrust by forced evolution into events that could not be stayed. Congress never saw fit to change the organic act when the emergency arrived; it was satisfied to let evolution take its course. The job of the early war days had to be done and the Council was doing it, better perhaps than if execu- tive powers had been conferred on it by precise and rigid statute; though the men of action who were ultimately to direct its indispensable functions often deplored the lack of "teeth" behind their eff"orts. Although overemphasizing the peace-time value of the Council, doubtless because he did not wish to emphasize preparatory war measures in the deli- cate days of the latter part of 1916, President Wilson, in announcing the appointment of the Advisory Commission of the Council, broadly stated the purposes of the Coimcil in the following words: The Council of National Defense has been created because the Congress has realized that the country is best prepared for war when thoroughly prepared for peace. From an economical point of view there is now very little difference between the machinery required for commercial efficiency and that required for military purposes. In both cases the whole industrial mechanism must be organized in the most effective way. Upon this conception of the national welfare, the Council is organized in the words of the act for "the creation of relations which will render possible in time of need the immediate concentration and utilization of the resources of the Nation." The organization of the Council likewise opens up a new and direct channel of communication and cooperation between business and scientific men and all departments of the Government, and it is hoped that it will, in addition, become a rallying point for civic 22 INDUSTRIAL AMERICA IN THE WORLD WAR THE COUNCIL OF NATIONAL DEFENSE 23 !M II !l bodies working for the national defense. The Council's chief func- tions are: 1. The coordination of all forms of transportation and the development of means of transportation to meet the military, industrial, and conunercial needs of the Nation. 2. The extension of the industrial mobilization work of the Com- mittee on Industrial Preparedness of the Naval Consulting Board. Complete information as to our present manufactur- ing and producing facilities adaptable to many-sided uses of modem warfare will be procured, analyzed, and made use of. One of the objects of the Council will be to inform American manufacturers as to the part they can and must play in national emergency. It is empowered to establish at once and maintain through subordinate bodies of specially qualified persons an auxiliary organization composed of men of the best creative and administrative capacity, capable of mobilizing to the utmost the resources of the country. The personnel of the Council's advisory members, appointed without regard to party, marks the entrance of the non-partisan engineer and professional man into American governmental affairs on a wider scale than ever before. It is responsive to the increased demand for and need of business organization in public matters and for the presence there of the best specialists in their respective fields. In the present instance, the time of some of the members of the Advisory Board could not be purchased. They serve the Gov- ernment without remuneration, efficiency being their sole object and Americanism their only motive. The men thus appointed to the Advisory Commission — Daniel Willard, president of the Baltimore & Ohio Railroad ; Bernard M. Baruch, financier; Howard E. Coffin, vice-presi- dent of the Hudson Motor Company; Julius Rosenwald, president of Sears, Roebuck & Company; Dr. HoUis Godfrey, president of the Drexel Institute of Philadelphia; Samuel Gompers, president of the American Federation of Labor; Dr. Franklin Martin, secretary-general of the American Col- lege of Surgeons, Chicago — little thought that they were so soon to become the head center of the thought and action of the Nation on its civil side, nor that they, serving without pay, would soon be marshaling the forces of the world's greatest industrial nation. In the nature of things the Advisory Commission of the Council of National Defense became the real executive branch of the Council. The Council proper was made up of the Secretary of War, who was elected chairman, the Secretary of the Navy, the Secretary of the Interior, the Secretary of Agriculture, the Secretary of Commerce, and the Secretary of Labor. It is true that the Council early distinctly affirmed that the duties of the Advisory Commis- sion were advisory and that the power of decision lay with the Council, thus conforming to the letter of the law; but the initiative lay with the members of the Commission and the Council inevitably came to accept its advice, and it was then charged with the execution of the things decided upon. Counsel and action united usually have their way under any executive. Hence it is true that in effect the seven members of the Commission, continuously occupied with the business side of war, were really the men who primarily shaped and directed the illimitable and multitudinous contacts of the Government with industry, business, and the daily life of all the people. The minutes of the Council and of the Commission show that in the beginning no member foresaw what was to eventu- ate from the early gropings of this group of men, who vaguely realized that something vast and far-reaching must be done if the untrained strength of the sleeping giant of America was to be concentrated in the effort that should win the war. From being a body of thinkers and directors of research, compilers of data and makers of inventory, who knew that in some way the things they recommended must be done, the Commission became the nucleus of ramifying committees, commissions, and boards which proceeded to do the things advised. It would be interesting to trace all the way through the evolution of the Commission from a group of somewhat bewildered men drawn from private life (meeting for the first time in a hotel room December 7, 1916) and with little experience in or knowledge of the workings of the machinery of government; but that would be to write a history of the Council of National Defense, and we are here concerned directly only with the Council's early history in so far as what subsequently became the War Industries Board was then i '9/ II I ^ 24 INDUSTRIAL AMERICA IN THE WORLD WAR embryonically acting. But, inasmuch as the War Industries Board in all commercial and industrial matters eventually be- came the master key of all the economic functions that grew out of the Council or the Advisory Commission, it is well to consider what it did in those early days of growth and differ- entiation. Perhaps the most striking, concise account of the Advisory Commission in the first three months of its existence was made by a partisan critic, the Honorable William J. Graham, who, after examining the minutes of the Council and of the Advisory Commission of the Council, which up to that time had been regarded as confidential, but which the writer turned over to him on request, reported to the Select Committee of the House of Representatives on Expenditure in the War Department (of which he was chair- man) what he called a "startling disclosure" of the "secret government of the United States."^ An examination of these minutes [he said] discloses the fact that a commission of seven men chosen by the President seem to have devised the entire system of purchasing war supplies, planned a press censorship, designed a system of food control and selected Herbert Hoover as its director, determined on a daylight-saving scheme, and in a word designed practically every war measure which the Congress subsequently enacted, and did all this behind closed doors, weeks and even months before the Congress of the United States declared war against Germany. ... It appears from the minutes of the Advisory Commission and the Council, which were kept separately, that practically all of the measures which were afterwards considered as war measures were initiated by this Advisory Commission, adopted by the Council, and afterwards acted upon by Congress. In many cases, a considerable period before the actual declaration of war with Germany, this Advisory Commission was discussing matters which were thought to be new legislation by reason of the necessities of war. For instance, on March 3d, over a month before the war declaration, the Advisory Commission endorsed to the Council of National Defense a daylight-saving scheme and recommended a Federal censorship of the press. . . . On February 15th, about two months before the declaration of war. Commissioners Cofl&n and Gompers made a report as to the exclusion of labor from military service, and the draft was dis- Uuly 7, 1919, Serial 1, Part 7, of the Committee's hearings. THE COUNCIL OF NATIONAL DEFENSE 25 cussed; the draft was also discussed on other occasions before any one in this country except the Advisory Commission and those who were closely affiliated with the Administration knew that a declara- tion of war was to be later made. At a meeting on February 1 5th this same commission of seven men (none of whom had any official authority except as advisers) recommended that Herbert Hoover be employed by the Government in connection with food control It was generally understood, as appears from the minutes, that Mr. Hoover was to be in control of the matter, although the war was two months in the future Almost the first thing the Com- mission did was to take up the matter of arranging an easy method of communication between the manufacturers and the Government. . . . In several meetings long before the war was declared this Advisory Commission of seven men met with the representatives of the manufacturing industries and formed an organization of them for selling supplies to the Government, which organization was well perfected before the war was declared. This method consisted of having the representatives of the various businesses, producing goods which the Government would have to buy, form themselves mto committees so that they might be able to sell to the Govern- ment the goods direct, which their industries produced. In almost every meetmg that this Advisory Commission held before the decla- ration of war, they discussed and recommended to the Council (which consisted of six Cabinet members) these plans for fixing pric^ and selling to the Government. When war was declared on April 6th the machinery began to move, headed by the Advisory Commission of seven men, who were, in effect, as shown by these minutes, the active government of the United States so far as the purchase of supplies was concerned. So far as I can observe, there was not an act of the so-called war legislation afterwards enacted that had not before the actual declaration of war been discussed and settled upon by this Advisory Commission. It is an interesting commentary on the responsibility of statesmen m a democracy that a distinguished Congressman should affect to think that he was making a startling sensa- tion out of a presentation of the obviously necessary prepa- rations for a war that was apparently inevitable months Delore the formal declaration. According to Mr. Graham, While It was reprehensible enough to have done anything a day before Congress formally decided that there was to be war, the miquity of the proceeding was that the Advisory Commission, m addition to advising, took steps to see that 1 « 1 *^ r# 26 INDUSTRIAL AMERICA IN THE WORLD WAR its recommendations, after approval by the Council, were put into execution. The only fault, aside from its bitterly depreciative tone, to be found with Mr. Graham's summary of the achieve- ments of the Advisory Commission before and in the early days of the war, is that, broad as it is, it does not tell the whole story. And it might be added that the only cause the Nation has for regretting what was then done is that it was not even more inclusive, specific, and compelling. On the other hand, it might be inferred, from Mr. Gra- ham's graphic, if unfriendly, summary, that the Advisory Commission had from the very first a deep and orderly understanding of the national problem, a clear conception and an adequate programme of how to undertake its solution. Such was not the case. In fact the minutes show, as might be expected, a distinctly experimental, tentative, and cau- tiously explorative attitude through the first two months (and permanent organization waited for three months). Save in one or two directions, a month passed before the commis- sioners began to get hold of concrete phases of the problem. At the meeting of January 8th, out of much talk and many suggestions came two practical suggestions that were destined to grow into great realities. Commissioner Daniel Willard "brought to the attention of the meeting the impor- tance of the development of ideas about railroad transporta- tion and suggested that an investigation should be under- taken through such means as seemed most appropriate for the purpose of developing in what way the railroads can be beneficial to the Government." This recommendation was adopted and Mr. Willard was appointed to make the investi- gation. This was the first seed of the Government Railroad Administration. The other suggestion came from Commissioner Baruch, and was really the first stirrings of life in what was to be the War Industries Board of a year later. Commissioner Baruch stated that he had been making a study of the steel and metal industries, and wanted to consult further with the authorities in those trades if the Commission felt that it was perfectly proper for him to go ahead. He had not been doing it as a member of the Commission and would not THE COUNCIL OF NATIONAL DEFENSE 27 necessarily need authority, but he wanted to feel that the Commission desired him to go ahead and bring from the suggestions of those trades an understanding of what they could do — how to get their resources together^ The sug- gestion was approved and Mr. Baruch was authorized to proceed. In a broad way of speech that was the task of the manage- ment of industry in the war - to get the country's resources together. The logical place for the initiation of the getting together was in the basic industries — the industries thai produced raw materials. Until the proper point of starting was generally understood, the control of industry was never rationally approached. The War Industries Board in its intermediate and final forms was the lineal descendant of the Council s dealings with raw materials, though chrono- logically It took its first recognized form in the General Mumtions Board. It took time for the fundamental concep- tion to prevail, and that meant the losing of time Yet nothing seems more obvious than that in the last analysis everything pertaining to production rests upon the supply of raw materials and the methods of utilizing them. As an expert appraiser of the values of securities, Mr. Baruch had early learned in a successful business career to go to the roots of all enterprises that sought the investors' dollars His experience and turn of mind naturally prompted him to seek for the control of the mobilization of national industrial strength m the first sources - in the primary materials and m transportation. It was not easily to be foretold, in the early days when ^LfT *'!''«J"«trial mobilization had just been created, what, if anything, worth while would come out of it. None oresaw that the "Wall Street speculator" who manifeS such an interest m raw materials would eventually become Ae head of the controlling body of th, whole industrial side IS diverted as easily as a rivulet by a snag. Time and chanc^ fuX me" ''''■ '^"''' ^'^ *^ "'" ^"-^ *^ ''PP- The easiest and most direct route of evolution would ^Italics are the author's. » I. i! 28 INDUSTRIAL AMERICA IN THE WORLD WAR seem to have been for the chairman of the AdW Commission or the director of the Council of National Defense to have shed his associates and emerged as the industrial dictator at a time when every one was weary ot conferences and committees and longmg for some strong man, with temperament suited to the times, to take the rems. The Chamber of Commerce of the United States at one time, perceiving that there should be an industrial command co-equal with the military command, recommended to Con- gress that the director of the Council should be given power and authority in the economic field analogous to that of the chief of staff of the military field. If, in the summer ot 1917, an executive genius had, with or without permission, injected himself into the situation, he might well have become the man of the hour, and the tedious and agonizing evolutionary process would have been shortened by at least '\rth?joint meeting of the Council and the Advisory Commission, held on February 12 1917, we find m a reso- lution originating with Secretary Lane the first formal state- ment of the idea of direct contact with the chief men m industry that Mr. Baruch had already been applymg m his voluntarily undertaken work and which he had been orally presenting to his Federal associates This resolution Pro- vided for the calling of a series of conferences with the leading men in each industry fundamentally necessary to the defense of industry in the event of war, at which con- ferences these men shall be asked to organize themselves so as to deal with the Council through one man or through a committee of not more than three men to whom the Council shall submit such problems as may affect such industries. That the Secretary of War shaU designate one or more mem- bers of the Council or Commission to meet with such con- ferences and set forth the desire of the Government and its prospective needs." - , This resolution resulted, at a subsequent meeting ot the Commission the same day, in a recommendation that the Commission be organized into committees, each member being a chairman of one committee and the other members being designated by him "from either governmental or civil THE COUNCIL OF NATIONAL DEFENSE 29 life, or both." Here we have the first definite step toward the system of committees and sub-committees which brought the Government into contact with the whole productive and distributive life of the Nation and became the basis of the system of democratic control of industry through personal conference and discussion, which reached its mature form in the commodity sections of the War Industries Board in connection with the complementary committees from indus- try. The Commission was accordingly divided into com- mittee chairmanships as follows: Daniel Willard, transportation and communication. Bernard M. Baruch, raw materials, minerals, and metals. Howard E. Cofl&n, munitions and manufacturing (including stand- ardization) and industrial relations. Julius Rosenwald, supplies (including clothing), etc. Dr. Hollis Godfrey, engineering and education. Samuel Gompers, labor (including conservation of health and wel- fare of workers). Dr. Franklin Martin, medicine and surgery (including general sani- tation). Three of these committee assignments were many months afterward to merge in whole or in part into the War Indus- tries Board; namely, that of raw materials, minerals, and metals, that of munitions, manufacturing and industrial rela- tions, and that of supplies. Out of the labor assignment came the Labor War Administration of the Department of Labor; out of transportation and communication came the war administration of railways under governmental control and operation. In addition, out of these or other committees or determinations of the Council grew the Food Administra- tion, the Fuel Administration, the Aircraft Production Board, and other extraordinary war-time agencies of Government. The next step in the evolution of what was to be the War Industries Board was taken when Commissioner Baruch reported to the joint meeting of the Council and Commission, on March 24th, a synopsis of the committees he had deter- mined upon in his department, some of the members of which were already named. The committee designations reported at that time were leather, rubber, steel, wool, nickel, oil, zinc, coal, and spruce wood. At the same time Mr. Baruch reported: rn I 30 INDUSTRIAL AMERICA IN THE WORLD WAR As a result of your committee's discussion with the Secretaries of War and Navy and the copper producers, a contract is about to be entered into between these departments and the copper producers for the copper that they state as their requirements at what your committee considers a very fair and reasonable price. The committee is also in the process of negotiations with other producers of raw materials which are to be used for the Govern- ment, that we believe will result in most favorable terms to the Government, such as zinc, lead, and steel products. The committee has, at the request of Secretary Redfield, taken up the matter of increased output of cans and tin plate. The canning and tin plate people have given assurances of their active cooperation. This report shows the Advisory Commission in practical business contact with industry for the first time. It is note- worthy, too, that at the same time Mr. Baruch's report showed how rapidly his dealing with raw materials was bringing him into contact with all of the elementary phases of indus- trial control for war purposes. Referring to transportation as he had come across it in his work, he said, 'This industry is basic to all others." The report also dwelt on the fact that "there are certain raw materials which are absolutely necessary which are not produced in this country, and which I think should be kept in sufficient quantities by the Government itself. Among these, it is of prime importance that we have a two years' supply of nitrate of soda until the artificial production of nitric acid is proven. Rubber, none of which is produced in the United States, and for which no substitute has yet been found, is another." As we are about to proceed on the evolutionary tangent that takes us away from the Council of National Defense, it will not be out of place to note how hard the Advisory Commission strove to awaken the Government and energize it into thought and planning for the impending conflict, and to give some glimpse of the obstacles that it had to contend with. The National Defense Act of 1916 was in some respects rather a national off^ense. Purporting to be a preparedness measure, it included the narrow provision that not more than half of the officers of the General Staflf should be in THE COUNCIL OF NATIONAL DEFENSE 31 Washington at one time. The fear that officers might be located in Washington for personal and social reasons rather than the needs of the service moved Congress to provide that, with war menacingly booming on the horizon, the military planning body could not even mobilize itself. This limita- tion of the Staff in numbers only to officers and in funds next to nothing undoubtedly resulted in the almost incredible circumstance that even six weeks before war was declared the army had not even hypothetical plans for the organization and equipment of a force of any size. Not only that, but it did not even have a formula for undertaking such a task. It actually remained for the Council of National Defense's Advisory Commission, a purely civilian body, to take the initiative (February 15, 1917) in calculating what the raising of an army of one million men would involve in the way of material. It appeared that it was impossible to get the information from the army in the desired detail, and so, at the instance of the Advisory Commission, a retired officer. Colonel J. F. Reynolds Landis, made a rough estimate for submission to the General Staff for review and revision, which was made by General Joseph E. Kuhn, then head of the War College, on March 15th — just three weeks before war was declared. The General made this comment, which reflects at once the financial timidity of those holding the purse-strings on the eve of war and that officer's comprehensive perception of the incidence of modem warfare: It should always be remembered that, although the cost of the original equipment for one million men may seem excessive, in fact nearly prohibitive,^ it will only represent a small percentage of the maintenance cost in the field. The important problem before this country will be how to organize its industrial resources so that the supplies required can be produced as rapidly as needed and in the proper proportions. With the astounding figures before it, and recalling, perhaps, that the Council proper had deferred action on its request of a month earlier, that "an immediate study be made of what, if any, legislation should be passed ^Italics are the author's. I I 32 INDUSTRIAL AMERICA IN THE WORLD WAR designed to empower the Government to deal effectively with any emergency that might arise," the Advisory Commission took a bold stand. On March 24th it said to the Council: "The Advisory Commission feels that it would be delinquent in its duty to the Council of National Defense if it did not at this time bring to the attention of the Council certain matters which we deem of great importance, together with such definite recommendations in connection therewith as rep- resent the views of the Commission." After voicing the public misgivings as to what was being done or not done to prepare for the looming emergency, the Advisory Com- mission then specifically recommended the immediate raising and equipping of an army of at least one million men and the bringing of the navy to full war strength. The feeling of the Commission that the Government was not awake to the perils of the crisis was reflected in three concluding paragraphs, which seem to have been an after- thought expressed in extenuation of the plain speaking of the Commission to the Council, whose personnel so largely made up the executive administration of the Government. The people of the country, as we see it, are very deeply concerned over the possibilities that might develop following the declaration of a state of war in the United States. They are looking to and waiting for the Council of National Defense to direct their efforts, and to take such other steps as may be necessary to provide for the security of the Nation. We feel very deeply impressed by the responsibility which rests upon us in this grave situation, and we feel that you are entitled not only to know our general views, but to have as well our definite recommendations. We appreciate that we may be misinformed, or more probably uninformed, concerning the real state of the Nation, with reference to the matter of preparedness, and that the fears which we entertain and the recommendations which we have made, may not in fact be justified, and nothing would give us greater personal satisfaction and relief than to have such assurance from you. We feel also that the public, which is very deeply concerned in this matter, and which so far has been willing to leave the ques- tion entirely in your hands, should also receive some assurance either that sufficient and definite steps to protect them against pos- sible contingencies have actually been taken or are about to be immediately inaugurated. THE COUNCIL OF NATIONAL DEFENSE 33 We bring this matter before you with the full realization that under the law this Commission is certainly not definitely charged with responsibility in these matters. We do not seek to initiate or direct policies which may have been decided upon and worked out by those who by official appointment are a part of the Administra- tion. We wish rather to lay before you for your information and consideration our innermost thoughts and fears concerning the seri- ous situation which we believe confronts the country, because we would feel condemned by our own conscience and sense of responsi- bility if we failed to do so. The writer, who was then secretary of the Council and Advisory Commission, recalls very vividly the tenseness of this joint meeting and the impersonal dignity and precision with which Chairman Willard in behalf of the Advisory Commission presented these views to the Council. It was only one of a number of similar dramatic incidents in which Mr. Willard was the spokesman. Just how much resulted from this initiative of the Advisory Commission is problematical, but it is true that the supply departments of the army attacked the problem of obtaining the funds that would be required for an army of one million men, after war had been declared, in every-man-f or-himself fashion. There was no guiding principle or controlling rule. The Quartermaster figured one way, the Ordnance Bureau another, the Medical Corps still another, and so on. Nobody knew what would be the proportions of the diff"erent arms, there was no accepted factor of wastage and replace- ment. Even the numerical strength of companies, batteries, regiments, and divisions was undetermined. So it was a case of each department head figuring a guess to suit him- self. The sum of the guesses totaled $1,250,000,000; but its components were so unrelated to each other that the War Department finally gave up in despair and asked Congress to vote the sum "in lump," which was the right thing for Congress to do, even if the War Department had had a clear understanding of its needs. True to its retail traditions, which it took more than the first few weeks of the war to over- throw, Congress insisted on a meticulous division and subdivision of appropriations, with no provision whatever for diversion of funds from one bureau to another or even !f m 1 ( 34 INDUSTRIAL AMERICA IN THE WORLD WAR from one item to another. Weeks passed in haggling with Congress over these matters. When it was explained to the chairman of the Senate Appropriations Committee that it was absolutely impossible for the War Department to tell how much money it would require, because "nobody on earth can make a reasonable guess of what it would cost to equip a soldier and put him on the battle-fields of France," he exclaimed, "My God! You don't intend to send men over there, do you?" A hazy idea prevailed that the declaration of war was merely a dramatic gesture — after which the United States would get very busy supplying the Allies with war material — at a price. With such a start the wonder is, not that there were many blunders and agonizing delays, but that things were done as well as they were in the early days. How much the fore- thought of the Advisory Commission of the Council of National Defense, and the thinking, planning, and acting of its individual members and their reactions on the Govern- ment through the Cabinet members who made up the Council, on army officers, on the Congress, and on uncrystallized public opinion, contributed to definition of purposes, clari- fication of ways, and energetic effort to resolve the tangle into straight lines will doubtless never be appreciated. By March 31st the Council and the Advisory Commission had got to the point where it was obvious that the require- ments of war would necessitate a comprehensive programme of control and coordination of buying and manufacturing. A resolution was adopted by the Council on that day, follow- ing the recommendation of the Commission, providing that the Secretary of War, as chairman of the Council of National Defense, shall appoint a Purchasing Board, Council of National Defense, to be composed of Army and Navy Department heads or officers appointed by them and representatives appointed by the Advisory Commission, the purpose being to coordinate the buying of the several departments; assist in the acquirement of raw materials and manufacturing facilities; the establishing of precedence of orders, etc., including the ordinary commercial and industrial needs and the military requirements of the Nation. Such committees shall THE COUNCIL OF NATIONAL DEFENSE 35 have no authority at this time to issue purchase orders, make con- tracts, or bind the Government in its purchases; all these things to be done, as at present, by the respective departments. The chairman of the Committee, however, shall have authority to require, when necessary, that certain (conflicting) purchases be not made until the same, with a full statement of the facts, have been sub- mitted to the Secretary of War or Navy. It was further set forth that the chairman of the Pur- chasing Committee should be designated by the chairman of the Advisory Commission; that the army should be rep- resented by the chiefs of Ordnance, Quartermaster Depart- ment, Engineer Corps, Signal Corps, Medical Corps, and General Staff; that the navy should be represented by the chiefs of Ordnance, Construction and Repairs, Medicine and Supplies, Marine Corps, Supplies and Accounts, Steam and Engineering, Yards and Docks. It was further provided that the Advisory Commission should be represented on the proposed committee by appointees of Messrs. Baruch, Coffin, Rosenwald, and Martin. Mr. F. A. Scott, a well-known manufacturer of Cleveland, was subsequently appointed chairman of this committee, whose name was changed to that of the General Munitions Board. Messrs. Coffin, Rosenwald, and Martin were the representatives of the Advisory Commission, Mr. Summers representing Mr. Baruch and the Raw Materials Committee. The General Munitions Board had been preceded by a Munitions Standards Board which virtually died with the birth of the General Munitions Board. The new board proceeded to appoint a number of sub- committees on army vehicles, armored cars, emergency con- struction contracts, optical glass, storage facilities, machine guns, priority, and accountancy. The General Munitions Board endeavored to direct its efforts toward the coordinating of purchases by the army and navy and assisting in the acquisition of raw materials in establishing the precedence of orders between the army and navy and between the industrial needs of the country. The Board's authority and scope of action were on the whole but vaguely defined. It necessarily dealt with raw materials, and yet there was a Raw Materials Committee of the M Ill I 36 INDUSTRIAL AMERICA IN THE WORLD WAR Advisory Commission. Similarly it had to do with require- ments of such supplies as cotton, woolen goods, and shoes and of the numerous articles required by the armed forces of the country, yet the Advisory Commission had, under a general Committee on Supplies, of which Commissioner Rosenwald was president, a host of cooperative committees on cotton goods, woolen manufactures, shoe and leather industries, knit goods, and canned goods. At this time, too. Commissioner Baruch had established sub-committees on alcohol, aluminum, asbestos, magnesium and roofing, brass, cement, chemicals (nine sub-committees), copper, lead, lumber, mica, nickel, steel and steel products (eleven sub- committees), oil, rubber, wool, and zinc. The General Munitions Board was not a month old before the members of the Advisory Commission began to see that it did not meet the demands of the hour. Instead of pro- gressing toward centralization, the Commission found that too many committees were being appointed. The Com- mission found itself constantly involved in talking about and recommending things that it jfelt some energetic, resourceful executive body should be doing. On June 13th, Director Giflford suggested to the Council a draft of a plan for reorganizing the committees, the Council having, on June 8th, called a halt on the multiplication of committees. On July 9th, Chairman Willard, of the Advisory Commission, urged on the Council that something be done to develop new and substitute sources of supply, such as toluol, oil, and nitrates, to follow up orders after placing, to distribute raw and manufactured materials in accordance with the relative urgency of demand, to improve the use of shipping, to deal with the question of prices on certain raw materials and finished products, and (the next day) to provide for ''central authority and decisive information." Finally after six weeks of consideration, the Council voted on July 8th to establish the War Industries Board. In place of the twenty-two members of the General Munitions Board, the War Industries Board was made up of Frank A. Scott, chairman; Bernard M. Baruch, Com- missioner of Raw Materials; Robert S. Brookings, Commis- sioner of Finished Products; Robert S. Lovett, Priority •i i Coftt/right bp Underwood If Underwood, X, }'. MAJOR-GEN. GEORGE W. GOETHALS Member of the War Industries Board represent- ing the Army REAR-ADMIRAL FRANK F. FLETCHER BRIG.-GEN. PALMER E. PIERCE Member of the War Industries Board representing Representing the Army in the early organization the Navy of the War Industries Board INTENTIONAL SECOND EXPOSURE f 36 INDUSTRIAL AMERICA IN THE WORLD WAR Advisory Commission. Similarly it had to do with require- ments of such supplies as cotton, woolen goods, and shoes and of the numerous articles required by the armed forces of the country, yet the Advisory Commission had, under a general Committee on Supplies, of which Commissioner Rosenwald was president, a host of cooperative committees on cotton goods, woolen manufactures, shoe and leather industries, knit goods, and canned goods. At this time, too. Commissioner Baruch had established sub-committees on alcohol, aluminum, asbestos, magnesium and roofing, brass, cement, chemicals (nine sub-committees), copper, lead, lumber, mica, nickel, steel and steel products (eleven sub- committees), oil, rubber, wool, and zinc. The General Munitions Board was not a month old before the members of the Advisory Commission began to see that it did not meet the demands of the hour. Instead of pro- gressing toward centralization, the Commission found that too many committees were being appointed. The Com- mission found itself constantly involved in talking about and recommending things that it felt some energetic, resourceful executive body should be doing. On June 13th, Director Gilford suggested to the Council a draft of a plan for reorganizing the committees, the Council having, on June 8th, called a halt on the multiplication of committees. On July 9th, Chairman Willard, of the Advisory Commission, urged on the Council that something be done to develop new and substitute sources of supply, such as toluol, oil, and nitrates, to follow up orders after placing, to distribute raw and manufactured materials in accordance with the relative urgency of demand, to improve the use of shipping, to deal with the question of prices on certain raw materials and finished products, and (the next day) to provide for '^central authority and decisive information," Finally after six weeks of consideration, the Council voted on July 8th to establish the War Industries Board. In place of the twenty-two members of the General Munitions Board, the War Industries Board was made up of Frank A. Scott, chairman; Bernard M. Baruch, Com- missioner of Raw Materials; Robert S. Brookings, Commis- sioner of Finished Products; Robert S. Lovett, Priority Co/ii/riif/it bj/ Underwood If UndeniooJ, 3'. }'. MAJOR-GEN. GEORGE W. GOETHALS Member of the War Industries Board represent- ing the Army EEAR-ADMmAL FRANK F. FLETCHER BRIG. -GEN. PALMER E. PIERCE Member of the War Industries Board representing Representing the Army in the early organization the Navy of the War Industries Board THE COUNCIL OF NATIONAL DEFENSE 37 f I < f << Commissioner; Hugh A. Frayne, Labor Commissioner; Colonel Palmer E. Pierce, representing the army; and Rear Admiral F. F. Fletcher, representing the navy. The duties of the new board were officially defined as follows: The Board will act as a clearing-house for the war-industry needs of the Government, determine the most effective ways of meeting them, and the best means and methods of increasing production, including the creation or extension of industries demanded by the emergency, the sequence and relative urgency of the needs of the different Government services, and consider price factors and, in the first instance, the industrial and labor aspects of problems involved and the general questions affecting the purchase of com- modities. On this Board Mr. Baruch will give his attention particularly to raw materials, Mr. Brookings to finished products, and Mr. Lovett to matters of priority. These three members, in association with Mr. Hoover so far as foodstuffs are involved, will constitute a com- mission to arrange purchases in accordance with the general policies formulated and approved. The Council of National Defense and the Advisory Commission will continue unchanged and will discharge the duties imposed upon them by law. The committees heretofore created inmiediately subordinate to the Council of National Defense, namely, Labor, Transportation and Communication, Shipping, Medicine and Sur- gery, Women's Defense Work, Cooperation with State Councils, Research and Inventions, Engineering and Education, Commercial Economy, Administration and Statistics, and Inland Transportation, will continue their activities under the direction and control of the Council. Those whose work is related to the duties of the War Industries Board will cooperate with it. The sub-committees advis- ing on particular industries and materials, both raw and finished, heretofore created, will also continue in existence and be available to furnish assistance to the War Industries Board. The purpose of this action is to expedite the work of the Gov- ernment, to furnish needed assistance to the departments engaged in making war purchases, to devolve clearly and definitely the impor- tant tasks indicated upon direct representatives of the Government not interested in commercial and industrial activities with which they will be called upon to deal, and to make clear that there is a total disassociation of the industrial committees from the actual arrangement of purchases on behalf of the Government. It will \ \ \\ 38 INDUSTRIAL AMERICA IN THE WORLD WAR lodge responsibility for effective action as definitely as possible under existing law. It does not minimize or dispense with the splendid service which representatives of industry and labor have so unselfishly placed at the disposal of the Government. The Council, then, through the attrition of events was proceeding to educe action from advice. 4 ll f f 4 NOTE The writer, who happens to be a Republican, wishes to make the following statement with regard to Secretary of War Baker and his five Democratic Cabinet associates forming the Council of National Defense: Looking back on the three years in which he served the Council, he is unable to recall a single instance in which Mr. Baker or the Council requested him to make an appointment or take an adminis- trative action on a personal or political basis. He believes this to be the experience as well of Mr. Gifford, who was Director of the Council during the critical early period, when the writer was its secretary. The writer always felt as free as air with Mr. Baker on this score, after the armistice as well as before. During the crowded vital days in which the Council's Advisory Commission, a majority of which was composed of Republicans, was almost daily nominating to the Council boards or committees of industrial and scientific experts — was, in short, creating the dollar-a-year men, the greater portion of whom were Republicans — there was not an instance, so far as the writer's memory serves, of an appointment being swayed by the political equation. The question was not raised at all. It was a clean business throughout in this respect, and a demonstration of non-partisanship in a crisis that the writer would not have believed possible before going to Washington. And it is something that in common decency needs saying — particularly when there is taken into account the tremen- dous unexpected task that was thrust upon the Council, composed of six work-driven heads of as many great Executive departments, in the early months of our participation in the war. To Secretary of War Baker undoubtedly should go the credit for making possible this state of affairs, which did honor to the Government and the country alike. The credit is no less due Mr. Baker by reason of the fact that his attitude reflected the policy of THE COUNCIL OF NATIONAL DEFENSE 39 the President with respect to enlisting the best industrial and scientific brains of the country regardless of party affiliation. Republicans comprised easily seven eighths of the personnel of the working executives of both the Council of National Defense and the War Industries Board and their subordinate bodies. The writer's immediate office staff and that of his predecessor was made up exclusively of Republicans, not because any one ever inquired as to the politics of an appointee, but because it happened to be so. So far as the writer's knowledge is concerned, and he was reasonably in a position to know, politics simply did not enter into the make-up of the American industrial war machine. Impartial analysis of the personnel structure of other vital emer- gency war bodies will tend to further interesting reflection in this field. All of which is something for those to ponder who attacked Mr. Wilson's administration for not establishing a coalition war government.^ *See page 189. CHAPTER III i f i THE WAR INDUSTRIES BOARD EMERGES The objective in sight — Synchronizing the civilian dollar-a-year man with the military — The machine lags — The bitter price of unpreparedness — The President acts — Enter Baruch — Review of the drifting period — Baker and Baruch- The new dispensation — Industry now stripped for war. The creation of the War Industries Board marked a great step forward. Coordination, the long-sought, was not yet overtaken, but it was in sight. It was now perceived that civilians must assume control of the general direction of industry. It was no longer a matter of advising about immediate munitions and helping the army and navy in buying. It was now a matter of deciding on the manipu- lation of the whole of the resources of the Nation. The objective had definitely emerged. The new board replaced the General Munitions Board and the Munitions Standards Board, whose very designations, as contrasted with that of the new board, showed how com- pletely new a dispensation it was to be. It logically took over the numerous raw material and supply committees, heretofore in separate compartments under Commissioners Baruch and Rosenwald, respectively, which were really the larger of the affluent sources united in the new board. The concept of the functions of a civilian agency cooperating with the army and navy for the control and direction of industry to war needs and purposes was now well defined and the agency for bringing it about somewhat compacted. Most of the functions of the Advisory Com- mission that related to materials and goods had been brought together under one head, but there was lacking a sufficient degree of either legislative or executive authority, and the organization was anomalous in that the chairman was not a member of the Advisory Commission and yet had such members serving under him. The stage of intelligent understanding had been reached, but the technique of executive direction remained to be THE WAR INDUSTRIES BOARD EMERGES 41 perfected and the Board was not accorded, in the view of the army and navy and other war instrumentalities, so high an estimate of its own importance as it rightly held of itself. Theoretically, coordination of requirements and purchases had been effected. Often, even generally, this was true, but the supply departments of the army and navy largely looked upon the War Industries Board as a sometimes helpful but usually meddlesome agency. They valued it highly as a source of information, esteemed its advice when they sought it; but felt no imperative necessity of yielding to it as the central clearing-house of the business activities of war. It took time for professional military men, even for the amateurs but lately commissioned, to concede that even in modern war there is a province for the man from civil life in which he must be superior to the man in uniform. The age-old tradition of war as a water-tight compartment in national life, instead of being that life itself, was hard to shake off. The time for fighting had come — the moment for which officers had spent years of preparation. War had the stage, and the fighting man, after years of obscurity and humility, had the spotlight and wanted to run the whole machine. Volunteer helpers in civilian clothes at dollar- a-year pay were apt to appear as interlopers desirous of holding the stage in war as well as in peace. If the subsequent practice had been equal to the spirit of the first meeting, the War Industries Board would have got into full function eight months before it did. Secretary Baker was there and stated that he and the Secretary of the Navy would accept all recommendations made by the Board. He also declared that, if necessary to support the War Industries Board in respect of its decisions regarding the requirements of the Allies, he would use the com- mandeering power to seize and pay for goods and would then sell them to the Allies at cost. Yet the army went on independently with the huge Du Pont contract, the immense storage and embarkation base at South Brooklyn, and scores of other projects that were bound to react disturbingly on the whole industrial balance. Its officers often ignored or were contemptuous of the Board, reckless commandeering flourished, and the navy in placid serenity pursued its own I ' *} 42 INDUSTRIAL AMERICA IN THE WORLD WAR way. This is set down, not in censure, but in emphasis of the fact that, though there was much crying of cooperation, there was a dearth of practice. Perhaps in despair of the Board's lack of vigor, Mr. Baker found his promise invalid, surrendered to the steam roller of the army's eager will to dominate, and thus came to seek a way out in that plan of military replacement of the War Industries Board by an organization within the army with which Mr. E. R. Stettinius was connected. Under such circumstances no amount of organization of the committee and board projections, under whatever impressive names — such as War Industries Board and Aircraft Production Board — proceeding from a body organically labeled as purely advisory, could begin to effect in attainment the perfection of its paper scheme. The only ways out of this situation were those of legislation, evolution, or devolution. Chairman Scott broke down under the multitude of cares and strains of the infinitely detailed work resulting partly from a lack of unassailable authority on which a smoothly functioning executive could be built up. At this time the Council and all its brood were under something of a cloud of public obloquy and eclipse of prestige resulting from the basically sound but hysterically overemphasized criticism of the fusion (eliminated when the War Industries Board was formed) of active business with membership of committees having to do with advice relating to purchases. The dual relation, the result of a hasty short cut, was undoubtedly wrong in principle, but it is a tribute to human nature at its best that there was in fact so little, if any, abuse of it.^ The American press is as mercurial and as given to emotional outburst as are the people themselves. It arrives at its final judgments only after voicing the most conflicting opinions, but the "revelations" of the period, and the skepti- cism of the public as to the integrity of any man placed in a position of buyer and seller in one, resulted in a great reaction of opinion concerning the Council and its subsidiary bodies. It had been the spoiled child of popular favor, and ^The Raw Materials Division avoided this rock. The chairman and his assistants were always representing the Crovemment, and the committees the industries. II* THE WAR INDUSTRIES BOARD EMERGES 43 it now was sent into Coventry. Its moral authority on its industrial side, as opposed to its work as the unifier of the national thought and will to victory, was impaired. The general public feeling at this time was that the American war eff'ort was fumbling both militarily and industrially. There was much talk of a coalition government, and the idea of a Munitions Department was in high favor. Thus there came a period of doldrums. The men in the Council's organiza- tion worked no less hard than before and made much progress in efficiency, but the impetus to rapid evolution was distinctly checked. Daniel Willard, president of the Baltimore & Ohio Railway, a noted and forceful executive and chairman of the Advisory Commission, succeeded Mr. Scott in the midst of this period of uncertainty and eventually resigned because he felt that he could do more as an active and powerful railway president than he could as head of an organization that had such great authority to advise and so little to act. Individual functions of the Board continued to perform services of the highest value, but there was lacking coordina- tion within what was supposed to be the great coordinator. In plain truth the War Industries Board was not meeting the demands of the hour. Its members knew what should be Its function, but the power of authority and action was lacking. So, it must be conceded that in the latter part of 1917 and first part of 1918, the evolution of the basic war control halted and stumbled. There was even a period, following Mr. Willard's resignation, when there was no chairman. It was at this time that the so-called War Council was created by the Council of National Defense. It was a weekly con- ference of the Council, the director thereof, the Secretary of the Treasury, the chairman of the Shipping Board, the Food Admmistrator, the Fuel Administrator, and the chairman ot the War Industries Board. Some progress resulted from these conferences, but the tendency of the time was too much toward the seeking of coordination through vocal confer- ences. What was needed was an autocrat over all suddIv matters. ^^ ^ The conferences were almost always harmonious and full Ill t (. I i' i 44 INDUSTRIAL AMERICA IN THE WORLD WAR of assurances of coordination. The executive spirit was willing, but somehow the effecting flesh did not respond. There was need of a powerful personality who would assume power and responsibility, who would decide and stand by his decisions and wrench his power from necessity. It may be that it required time and disappointing experience to bring the War Industries Board to the climax of its poten- tialities, but, in view of the simplicity of the organization that finally accomplished the end, and the fact that it never had more statutory power at the last than at the first, it is the matured judgment of the writer, who lived at close quarters with the events of this period, as well as with those of the preceding and successive phases, that the evolutionary process could have been compressed greatly. The fact is that in the formative months of the Board, the true principle of executive success was not applied — the principle of centralization of responsibility and decentraliza- tion of authority. Mr. Scott's tendency was to centralize both, and Mr. Willard was disgusted with the lack of specific authority. All along the line everybody was either waiting, or needed, to be told what to do by some one who could make it "stick." We are forced to the conclusion, then, that development of the War Industries Board halted for lack of the right man at the head.^ This involves no depreciation of Mr. Scott or Mr. Willard as executives. The situation not only demanded a great executive, but, more, it required one whose environment in life was such that he would be under no compulsion of men, traditions, contacts, or things. It called for a man whose environment had made him so independent that he could, in the words of the late Paul Morton, "look any man in the eye and tell him to go to hell," if need be. Such a man could have done in the middle of 1917 what was done in the spring of 1918. On the other hand, it must be remembered that each passing month of failure to arrive at the much-talked- ^t is known that the President himself, throughout this terrible drifting period that depressed all of us, was seeking for what he called a "superman" to head the War Industries Board. The position was oflFered to Homer Fergu- son, then president of the Newport News Shipbuilding Company, and later head of the Chamber of Commerce of the United States; and to John D. Ryan, later in charge of aircraft production. Both declined, doubtless because of the inhibitions surrounding the post. THE WAR INDUSTRIES BOARD EMERGES 45 of coordination in a sense made the job easier for the right man. The functions of the Board were developing all the while, and there was much that was possible of accomplish- ment in the then mood of industry and the war agencies that did not need to be backed by a central will. The functional instrumentalities of the Board developed rapidly after the formation of the War Industries Board in August, 1917. The principle of priorities was well estab- lished, as also its administration. Conservation was in full swing. Clearance, on paper at least, was working smoothly. The vital Inter-Allied Purchasing Commission had been firmly established. Price-fixing was making a good start. The appraisement of resources was steadily going on and headway was being made in the massing and systematization of requirements. The labor division was functioning effec- tively. The commodity sections were busily at work, as far as they had been created. While the machine as a whole was not yet filling the void in the great structure of industrial unification in support of the army and navy and the main- tenance of the national industrial fabric, it was already taking much the final form in which it was later welded so successfully. Time was lost in the gradual growth, but at the same time each functional activity, as a result of the gradual process, met with little opposition when proposed. The machine was one that was developed rather than pro- jected. It was the child of experience and of obvious necessity, and not the product of theory. Each part worked when introduced because it was manifestly needed. By this time there was a well-crystallized conception of the objectives of the War Industries Board's work. How- ever defective the attainment of them remained until the spring of 1918, they continued to be the established goals. Briefly stated, the functions of the Board were (1) to allocate commodities of which there was or was likely to be a deficit, to encourage their increased production and effect their orderly flow "into channels most conducive to the purposes of the war," which necessitated "priority" and price-fixing; (2) to analyze, bring together, measure, alter, and restrain the demands of the Government, of the Allies and of the public; (3) to ascertain to what extent and in < 46 INDUSTRIAL AMERICA IN THE WORLD WAR what manner the supplies could meet the requirements; and to take the action thereby indicated. The essential nature of the War Industries Board was lucidly stated in an address' by Mr. Baruch before the War College in Washington, when he said: The War Industries Board was a method of control devised by the President to equalize the strain placed upon the American mdustnal structure by the war. It endeavored to stimulate and expand production of those materials essential to the war pro- gramme, and at die same time to depress and curtail production of those things not of a necessitous nature. This was done by regu- lation in consonance with other executive branches of the basic economic elements: (a) facilities, (b) materials, (c) fuel, (d) transportation, (e) labor, (f) capital. The method of control was through a preference list upon which were placed those industries whose output was essential to the war's progress. The priority indicated by the preference list was the master key to the six elements named. It should be said that, although it was the exchange of the Government agencies involved in the prosecution of the war — the universal meeting-place of requirements, resources and facilities, maker of prices, moulder of contracts, accel- erator and brake of industry — it was not a purchasing agency m the strict sense. Except for its own expenses it never spent a cent of Government money. It made agree- ments with the trades, but it did not sign contracts. Actual purchases, contracts, and all the details of business trans- actions were attended to by the proper agencies within the departments that were statutorily charged with purchasing functions. In a broad sense it was certainly a comptroller of purchases, but it did not make them. This lack of actual purchasing power was sometimes a very serious handicap, but it was offset by a detachment from an infinitude of details and personal contacts that made for added power in dealing with the fundamentals of Government relations to industry. The functional divisions of the Board's work and the solid base of the commodity sections on and through which the functions were largely exercised will be considered as to ^March 12, 1921. THE WAR INDUSTRIES BOARD EMERGES 47 both origin and composition and nature at a later time. In recording the achievements of the War Industries Board, how- ever, no special effort will be made to distinguish between the war industrial measures taken directly under the Council of National Defense, under the General Munitions Board, under the first phase of the War Industries Board, or under its second and final phase. From the beginnings of the Council the functions of the War Industries Board were exercised. In essence the Board or what it stood for was born with the Council. As the long-heralded German drive of the spring of 1918 came nearer, it was more and more borne in on the men in the Council and in the War Industries Board, and among all who were in touch with the progress of the war effort, that America must speed up and tighten up its war machine. It was evident that the country was not yet in effective fight- ing trim — that its vast strength was not yet being applied; that it was still entangled in the coils of disordered efforts; that the army, engaged in the stupendous task of organizing the personnel of the actual fighting forces, which time and again were expanded beyond the early estimates, was not able to rise above its immediate absorptions far enough to gain a comprehensive view of the industrial incidence and indispensable corollaries of its own plans and necessities. This, of course, was the inevitable result of the blind policy of unpreparedness which has dominated the Nation from time immemorial. Considering the circumstances, it is amazing that the army so smoothly and so vastly expanded from a handful of men to trained millions in arms. To meet the concomitant indus- trial expansion and conversion it was indispensable that men who understood commerce and production as the military chiefs understood their peculiar field must find a way to dominate the army in relation to those bases of army strength which were to be found primarily in civilian management. It was evident that no mere advisory body could withstand the initiative of the compact authoritative army organization, burning with zeal and sparkling with energy in its rush to perfect and expand itself, without due regard to an impair- ment of the sources of ultimate supply and power that was I I 4a INDUSTRIAL AMERICA IN THE WORLD WAR certain to follow. The army did not adequately comprehend the greater strategy of modern war, the industrial strategy, with its colossal scale, which involves the maneuvering and directing of all the forces and resources of the Nation ; which is a matter of factories and mines and labor, of coal and wheat and steel, of transportation and civil morale as much as of regiments, divisions, corps, and armies. The time had come when there must be created a power that would be able to harness the purely military organiza- tion and the war industrial forces into an harmonious team. Either the War Industries Board must rise to this eminence or there must be an entire reconstruction of the central control. The former course was decided upon by the Pres- ident, probably because it was merely a step forward with an existing mechanism which could be taken without upset of what was being done well and without resort to Congress for new legislation. It required only an Executive order that would impart to the War Industries Board such share of the well-nigh universal war powers of the President as com- mander-in-chief of the army and navy, as would make it supreme in the contacts of military and industrial depart- ments of the armed Nation. So,, it came about that on March 4, 1918, the President issued the Executive order which endowed the War Industries Board with authority proceeding directly from the supreme source of the executive power. The war was henceforth to be conducted, not only by the army and the navy, but by them with the War Industries Board, and in its field the last was to be supreme. While the Board was thus brought into a position of unquestionable potency in relation to the army and navy, it would have required legislation to strengthen its original power over industry. It had, however, such a grip on industry by reason of its now more intimate cohesion with the Executive and military establishments and its free- dom of resort to the powers invested in them by reason of various acts, which will be reviewed later, as well as with the transcendent war powers of the President, that legislation was neither necessary nor advisable. The President's letter of March 4, 1918, did not work any fundamental change in the evolved structure of the War THE WAR INDUSTRIES BOARD EMERGES 49 Industries Board. ^ It simply appointed a new chairman of the Board and gave him the prestige and substance of direct Presidential authority that made him independent of the military arms. The machinery remained much the same, but it was henceforth dominated by civilians, was now suf- fused with power, and was happily placed in the control of a man peculiarly fitted for the task, Bernard M. Baruch. It should not be overlooked that the Executive order did remarkably tend to unify and coordinate the Board itself. With the exception of the price-fixing function, the whole authority of the Board was centralized in the new chairman, which gave him an advantage that neither of his predecessors *The text of the letter is as follows: The White House Washington, March 4, 1918 My dear Mr. Baruch: I am writing to ask if you will not accept appointment as Chainnan of the War Industries Board, and I am going to take the liberty at the same time of outlining the functions, the constitution and action of the Board as I think they should now be established. The functions of the Board should be: (1) The creation of new facilities and the disclosing, if necessary, the opening up of new or additional sources of supply; (2) The conversion of existing facilities, where necessary, to new uses; (3) The studious conservation of resources and facilities by scientific, commercial, and industrial economies; (4) Advice to the several purchasing agencies of the Government with regard to the prices to be paid; (5) The determination, wherever necessary, of priorities of production and of delivery and of the proportions of any given article to be made immediately accessible to the several purchasing agencies when the supply of that article is insufficient, either temporarily or permanently; (6) The making of purchases for the Allies. The Board should be constituted as at present and should retain, so far as necessary and so far as consistent with the character and purposes of the reorganization, its present advisory agencies; but the ultimate decision of all questions, except the determination of prices, should rest always with the Chairman, the other members acting in a cooperative and advisory capacity. The further organization of advice I will indicate below. In the determination of priorities of production, when it is not possible to have the full supply of any article that is needed produced at once, the Chair- man should be assisted, and, so far as practicable, guided, by the present priorities organization or its equivalent. In the determination of priorities of delivery, when they must be determined, he should be assisted, when necessary, in addition to the present advisory priorities organization, by the advice and cooperation of a committee consti- tuted for the purpose and consisting of official representatives of the Food Administration, the Fuel Administration, the Railway Administration, the Ship- ping Board, and the War Trade Board, in order that, when a priority of delivery has been determined, there may be common, consistent, and concerted action to carry it into effect. In the determination of prices the Chairman should be governed by the advice of a committee consisting, besides himself, of the members of the Board I II ,1 /{ I 50 INDUSTRIAL AMERICA IN THE WORLD WAR had. The Board as a whole and its subsidiary bodies remained, but the sole right of decision was placed in the hands of the chairman. Authority and responsibility were centered in one man, to do with them as he pleased. He wisely chose to delegate the authority and retain the responsi- bility. To each of his boards he transmitted all of the power in that particular direction that the President had conveyed to him and at the same time he imdertook to shoulder all responsibility. The exception of price-fixing from direct control by the chairman of the Board, while a seeming violation of the long-awaited application of the principle of the centraliza- tion of power and responsibility, was really a lubricant for immediately charged with the study of raw materials and of manufactured products, of the labor member of the board, of the Chairman of the Federal Trade Commission, the Chairman of the Tariff Commission, and the Fuel Administrator. The Chairman should be constantly and systematically mformed of all contracts, purchases, and deliveries, in order that he may have always before him a schematized analysis of the progress of business in the several supply divisions of the Government in all departments. The duties of the Chairman are: (1) To act for the joint and several benefit of all the supply departments of the Government. (2) To let alone what is being successfully done and interfere as little as possible with the present normal processes of purchase and delivery in the several departments. (3) To guide and assist wherever the need for guidance or assistance inay be revealed; for example, in the allocation of contracts, in obtaining access to materials in any way preempted, or in the disclosure of sources of supply. (4) To determine what is to be done when there is any competitive or other conflict of interest between departments in the matter of sup- plies; for example, when there is not a sufficient immediate supply for all and there must be a decision as to priority of need or delivery, or when there is competition for the same source of manufacture or supply, or when contracts have not been placed in such a way as to get advantage of the full productive capacity of the country. (5) To see that contracts and deliveries are followed up where such assistance as is indicated under (3) and (4) above has proved to be necessary. (6) To anticipate the prospective needs of the several supply departments of the Government and their feasible adjustment to the industry of the country as far in advance as possible, in order that as definite an outlook and opportunity for planning as possible may be afforded the business men of the country. In brief, he should act as the general eye of all supply departments in the field of industry. Cordially and sincerely yours WooDROW Wilson Mr. Bernard M. Baruch, Washington, D.C. I » THE WAR INDUSTRIES BOARD EMERGES 51 the whole organism. Price-fixing was a ticklish business and miffht easily cause more misapprehension and arouse more public censure of the Board than anything else it could do. If prices were thought too liberal by the general public, the Board — if it had had the ultimate responsibility for hxing them — would have been accused of being the tool of the "interests," which was a calumny that was always lurking in the background and frequently voiced. If considered too close by the manufacturing public, the opposite charge ot persecution of business would have been hurled at it. by having the prices suggested by a committee that was in the Board, but was appointed directly by the President, who passed personally on its decisions, the responsibility was placed on a too lofty eminence for successful assault by scandalmongers or profiteers. , , j • i The War Industries Board was now an entity, clothed with ample authority and commanded by a seasoned captain, who had had fifteen months of arduous experience in the difficult art of making "requests" as effective as orders. He had been through the mill. He had helped build the machine in every part from the earliest days and the general plan had been originated by him. He now proceeded to perfect and extend the machine, change and add to personnel to make it conform to the organic conception of expert civilian intermediation between the war-making and war supply. It would be pleasing to say that the evolutionary process, though tedious, was a steadily progressive one, but the dismal truth is that it was intermittent, with a long period that came near to devolution and dissolution. The defect of the War Industries Board, as at first created, was that it was a com- mittee. Committees are good for counsel, but poor for action, and especially so when their authority is nebulous, and for lack of leadership they do not stretch it and strengthen it by use. So, all through the fall of 1917 and winter of 1918 we find the War Industries Board talking much and postponing or refusing decision. "There is a tendency to too much looseness and getting tired once in a while," says an entry in Mr. Baruch's diary in November. "The more committees, the more lack of r • 52 INDUSTRIAL AMERICA IN THE WORLD WAR N 't I m coordination," reads another entry. "No one wants to give the power to one man. This makes them less powerful, and they think it makes him too powerful. Fiddle while Rome bums. It will go, but time is the essence." Referring to another delay in passing on a powder plant project, the skeletonized diary asks, "Will this be a case of too late, as in another instance, of one man authority and responsibility needed?" "All these men get everybody's advice, and then take the wrong advice," runs another comment on the committee sys- tem. "I would rather do the wrong thing than wait till the right thing becomes the wrong thing and the wrong action would have been the right one." And again: "What is everybody's job is nobody's job." "The confusion is greater and not less here," says an entry on January 19th. "No one has a plan and all' seem too tired to do anything except to criticize." At this time it appears that the Secretary of War was considering some sort of a law to centralize the administra- tion of munitions. Referring to this fact, the diary says: "In the meantime, the greatest disorganization is going out and grabbing right and left for men to strengthen themselves, with no thought of the thing as a whole." Coordination was still an iridescent dream. For lack of a powerful centralized control, every department was seeking to do its best in its own way; making itself internally efficient, while rendering the improvement nugatory by destroying team-work. Of many records that might be cited to show how many twilight zones of overlapping authority there were, it will suffice to take one relating to imported raw materials. A letter from Baruch to Dr. Edwin F. Gay, then associated with the Shipping Board as head of the Bureau of Planning and Statistics, written on February 23, 1918, sets forth that after nearly a year imported raw materials were definitely under the control of no one agency. The Shipping Board, the War Trade Board, and the War Industries Board were all inter- ested in this subject, and whatever the last-named did in its efforts to make the best use of all available supplies was subject to review and revision by the others. If mf THE WAR INDUSTRIES BOARD EMERGES 53 Either you must have confidence in the War Industries Board's findings or the War Industries Board must have confidence in your findings. If each department of the Government has an agency to review the findings of the other, interminable delays will follow, responsibility will rest nowhere, and the work cannot and will not be done. Therefore, as I have said to you on many occasions before, you can depend upon my hearty and active cooperation, but I beg of you not to pass by the suggestions I make to you. There is too much duplication already, business is being harrowed by their increasing questionnaires and the multiplying of committees. There is no one organization to which business can look for aid and instruction. On paper, the War Industries Board was the clearing- house of materials, but, evidently, it was not functioning. At this time the Board was even without a chairman. On February 2d, Baruch's diary records a solemn warning to the Board of the necessity of clearing raw materials through one channel. Both the diary and correspondence between mem- bers of the Board and heads of departments and war agencies show that all through this period the War Industries Board was far from accomplishing its purpose. In spite of the fact that the word "coordination" was worn threadbare from much use, there was no central power driving to that end. It would be inaccurate to give the impression that there was not a great amount of correlation and cooperation, but it was clumsily eflfected, irregular and uncertain. There is authori- tative documentary evidence that as late as February, 1918, the various bureaus of the War Department had not suc- ceeded even in coordinating themselves in the matter of purchase to effect which the Advisory Commission of the Council of National Defense, the General Munitions Board, and the War Industries Board had successively addressed themselves. It was not only to effect this internal harmonization, but probably to become independent of the War Industries Board, that E. R. Stettinius, a partner in the banking firm of J. P. Morgan & Co., was brought into the War Department at the end of January, 1918, as Surveyor-General of Supply. He did not accomplish much in the way of eliminating the War Industries Board because the men he needed were with I 54 INDUSTRIAL AMERICA IN THE WORLD WAR Banich and because the Secretary of War recognized that he must work with the War Industries Board. Back of Stettinius's appointment there seems to have been an idea that, as the War Industries Board was dwindling instead of growing, it was incumbent upon the War Department to rely upon itself, and to take up anew the burdens of which it had not been effectively relieved. The thought the Secretary of War was giving to the subject of reorganizing the industrial relations of the Government and Baruch's growing disgust with the way things were drift- ing in the headless War Industries Board brought them into conference on February 1, 1918, though it must be remem- bered that Baruch was then only one among the members of the Board. While it seems to be pretty well established that Baruch and Secretary Baker were not closely attuned, and the latter was opposed to the former's appointment as chairman of the War Industries Board, the Secretary was favorably impressed by Baruch's draft of a scheme for a creation of a Director of War Industries and Raw Materials. Incidentally, it is interesting to note that a month or so before this conference of February 1st, the Secretary of War, in discussing with Baruch the filling of the vacant chairman- ship of the Board, informed him that, while he (Baruch) had done the best work of any of the civilian executives called into service by the emergency, he (the Secretary) did not consider that Baruch was fitted for the place of executive in a large organization. It was the Secretary's idea to appoint to the headship of the new organization a great industrialist not then connected with the Board. Baruch was to be a sort of under-secretary to the new man and the real power behind the throne. This was the supreme test of the quality of patience and the policy of submergence of self that had stood Baruch in such good stead in all the months in which, despite untold discouragements and humiliating rebuffs, he had steadily driven ahead with the work in hand, doing each task as it arose or as he created it. Had the President requested it, it is likely that Baruch would have stood even this test. Just what finally directed the President's choice to Baruch is not known, but it is suspected that Secretary McAdoo had some- THE WAR INDUSTRIES BOARD EMERGES 55 thing to do with the matter, for it is known that he informed Baruch that if his position in the War Industries Board became intolerable he "could come over and run the rail- ways." It must not be forgotten that at this time Baruch, as a member of the War Industries Board, which was still a part of the Council of National Defense organization, was really subordinate to Secretary Baker, who was chairman and dominant member of the Council, and that the Secretary was entirely within his rights in taking it upon himself to name or recommend the new chairman of the Board. A brief draft of the proposed reorganization submitted by Baruch to Baker afforded a basis for the conference between them. The following is a copy of it: Director of War Industries and Raw Materials This should be a legal, authoritative, responsible, centralized agency for the purpose of coordinating the demands of the fighting forces. The object should be to mobilize the resources of the country, to create new facilities and additional sources of supply, not alone for the military and naval requirements, but civilian needs with as little dislocation of industry as possible. This agency should have the power, subject to the approval of the President, to commandeer plants, products, equipment, manufacturing facilities, mines and materials, and the additional power not now granted of reselling and distributing materials thus commandeered. He should be appointed by the President. In no way is he to have anything to do with naval or military matters, but only fur- nishes requirements for the military and naval forces. He should decentralize his authority by appointing, subject to the approval of the President (if he so desires), heads of various departments subdivided substantially as outlined below; new departments or subdivisions to be added from time to time, as found necessary. These departments are not arranged in the order of their relative importance. Explosives. Guns, Shells and Components? (Doubtful, for discussion.) Supplies. Conversion of Industries. Creation of New Facilities. Priority Division. Various Raw Material Divisions, as Steel, Non-Ferrous Metals, Chemicals, Lumber, Miscellaneous, etc. 56 INDUSTRIAL AMERICA IN THE WORLD WAR I ,1 Statistics. Power Controller. Board of Compensation and Price-Fixing (five, one of whom shall be a labor man). This last-named board, in cooperation with the Federal Trade Commission, shall, subject to approval of the President, fix the prices of all materials. It will act in all large or important con- tracts in case of disagreement. This eliminates delays. All requirements to be submitted to his chiefs for allocation and determination. Good judgment will dictate as to what he should direct and what he should not. Contracts to be signed by the departments, as now, which shall also determine the technical questions, inspection, follow-up, and receiving. Under the reorgan- ized system the Director of Supplies for the Army, the Paymaster- General for the Navy, the Purchasing Agent or other designated ofl&cer of the Shipping Board, the Purchasing Agent of the Aircraft Production Board, and the Allied Purchasing Commission submit requirements through the Director to the subdivisions. If necessary to create new facilities or sources of supply, the technical men of the departments involved must necessarily be used. On February 1st, Secretary Baker sent to the President a letter setting forth the joint conceptions of himself and Banich regarding a reorganization of the War Industries Board, which deserves quotation in full, as follows: My dear Mr. President: Mr. Baruch and I have discussed at length the suggestion of a reorganization of the War Industries Board. Mr. Baruch believes that the body should be a legal, authoritative, responsible, cent- ralized agency for the purpose of coordinating the demands of the fighting forces. Its object should be to mobilize the resources of the country, to reveal new facilities and additional sources of supply, not alone for the military and naval requirements; but also to the end that the civilian needs be supplied with as little dislocation of industry as possible; that this agency should have power, subject to the approval of the President, to commandeer plants, products, equipment, manufacturing facilities, mines and materials, and the additional power not now granted of distributing materials thus commandeered. In this general statement I concur. Mr. Baruch believes with me that it takes in, in general terms, the whole programme, and that, in all likelihood, some of the features cannot be immediately » THE WAR INDUSTRIES BOARD EMERGES 57 accomplished; but that ultimately this agency whatever its form will have to exercise substantially these functions. We agree that the following functions are to be performed: 1. Procurement of military supplies. 2. Conservation of general industrial condition of the country. 3. The determination of prices and compensation. In order to carry out these purposes, it seems to us that the present plan of organization of the War Industries Board is ill- adapted, for the reason, first, that its numbers lead to debate and delayed decision, and, second, because its power is at present consultative and not final, except by consent. We recognize that the present question is the appointment of a successor to Mr. Willard, and that the redistribution of power will have to be delayed until the President is empowered by legislatioVi; but the immediate reorganization could begin and suitable distribu- tions of power could then be made when the legislation is secured. Our suggestions, therefore, would be that a chairman of the War Industries Board be appointed; that he be directed immedi- ately to reorganize the institution so as to bring about a compre- hensive survey by him of the war needs of the Government, with power in the Chairman to allocate supplies of material and manufacturing facilities, and to determine conversions of industry, both for apportionment to the several war needs reported to him by the purchasing departments of the Government, and also with a view to the adjustment of the industrial needs of the Government to the general industrial situation of the country, so as to prevent undue dislocation; and to have in view constantly the distribution of labor, transportation facilities of the country, and the general maintenance of industrial standards and facilities, both during and after the war. Second, the creation of a committee to work in cooperation with the Federal Trade Commission, and to report directly to the President, for the semi- judicial determination of questions of com- pensation and price. The questions to be considered by this body to be referred to it by the chairman of the War Industries Board, and its general administrative procedure subject to his general direction. Such an organization as is herein suggested would, of course, leave the Allied Purchasing Commission in its present state, unless the reorganization of it was deemed advisable; but that could later be determined. Mr. Baruch believes that it would be easily possible to concen- trate this entire purchasing function in one man. If that could be done, and the power were vested in the chairman, the agencies 58 INDUSTRIAL AMERICA IN THE WORLD WAR I I I :1 r now established could continue to perform all of tlie work, except the final decisions which would then go to an individual. The civilian members of the War Industries Board as now com- posed would be assigned functions in connection with compensation and price determination, and the military and naval members of the Board would, of course, in any event be replaced by those persons who under the reorganizations which have taken place are more appropriate as aids to the chairman in the solution of his problems affecting the several departments. By this process the single representatives of the War, Navy, Allied, and Shipping Boards could meet, clear the difficulties, coordinate their needs, and in consultation with the chairman of the War Industries Board submit their programme for his final allocation, distribution, and judgment. This plan does not contemplate the actual moulding of specifi- cations and contracts, the industrial follow-up, inspection, delivery, storage, or distribution of by the director of War Industries; but leaves those functions to the strongly organized agencies already established in the several departments, except to the extent which the performance of any of these functions aflfects the entire pro- gramme. Where any such question arose, the chairman, by con- sultation, could easily arrange conditions to overcome the difference. The foregoing letter was satisfactory to Baruch, except that he feared that it "was not definite enough as to our thoughts that this agency should be an individual who decen- tralizes the execution of his authority. In this letter you speak of it as a body, which gives the impression that we thought it should be a board, whereas I understood we were both agreed it should be one man."^ In response to this suggestion Mr. Baker replied that he was sending the Presi- dent a note which would "clear up any doubt." A month later, on March 4th, the President took the action which reconstituted the War Industries Board, instead of creating a director of War Industries and Raw Materials. But while the name remained, power was centralized in the chairman, except as to price-fixing. As this was purely an executive act, in anticipation of the passage of the Overman Bill giving the President broad powers of delegation and redistribution of executive authority, it is a justifiable infer- ^Letter to Mr. Baker, February 4, 1918. I THE WAR INDUSTRIES BOARD EMERGES 59 ence that the President preferred the use of an existing designation to one which might raise a question as to whether he was entrenching upon the legislative field. Another con- sideration might have been the relation of the determined executive reorganization to the bills for the creation of a Department of Munitions, which had been introduced into Congress and widely discussed. Names do make a difference, after all, and a vitalized War Industries Board might be all that a Munitions Depart- ment could be, in practical results, and yet be the child of an evolving executive policy instead of a creation enforced by Congress in response to hostile criticism. It might be added that the designation proposed by Mr. Baruch would have made it easier for him to exercise the powers that were con- ferred upon him. "Director" has a more impressive sound than "Chairman of the War Industries Board," and it took some time for all who were affected to understand that the chairman after March 4th was as little like the chairman before that day as a lion is like a lamb. Historically, the change of name would have been important because it would have emphasized and marked the emerging of a great, new war control, greater than any of the other special war agen- cies. The public would have perceived at once what was then only plain to close observers that the instrumentality of industrial control for war purposes had been revolution- ized and that a tired, bored, and discouraged committee had been replaced with an industrial dictator, surrounded, it is true, by a board, but a board with no more real authority over the dictator than the Cabinet has over the President; in fact, designedly occupying precisely a similar relation. It is an interesting fact that on May 30, 1917, nine months before, Mr. Baruch submitted to the President a draft of a proposed general purchasing agency, which was to have essentially the same powers that the War Industries Board eventually received, but with a more authoritative contact with the Food Administration and the Shipping Board (other special war agencies had not then been created) than it finally arrived at. In practice, the lack of close adminis- trative articulation between the War Industries Board and the Food Administration was not harmful, as their spheres % ''^iilj ^ 1 I ^ I I I 60 INDUSTRIAL AMERICA IN THE WORLD WAR being quite distinct they always cooperated amicably. But the records of the War Industries Board are strewn with dis- tressing instances of failure to utilize the always inadequate shipping facilities in the best interests of the war programme as a whole, because it was the Shipping Board itself instead of the industrial control agency that determined how ship- ping should be allocated. It is not to be implied that there was any conflict between the two bodies, but they were so interwoven in their fields that the War Industries Board should have had the initiative in the disposition of available shipping according to the degree of necessity indicated by its survey of the whole internal and external war situation. Although there was much improvement in coordination between the two agencies as time went on, it is an indisputable fact that the great principle of priority according to national need was never fully applied to shipping, with the result that the Shipping Board was always confronted with conflicting demands for tonnage, which it met in piecemeal fashion; frequently satis- fying new demands by withdrawing ships from more neces- sary services. The Railroad Administration seems to have comprehended so fully the basic idea that the railways were merely an intra-mural transport instrumentality for the Nation, con- ceived as a single producing unit for war, that there was no necessity for any formal conveyance to the War Industries Board of final power over them. McAdoo and Hines promptly shaped transportation to all requirements of the War Industries Board. The Fuel Administration should have been directly under the War Industries Board, for, while there was remarkable team-work and absolutely no conflict between them, the sepa- ration of authority over coal production and distribution from the general industrial executive resulted in a degree of lost motion and lost time. The War Trade Board was eventually fairly efi'ectively tied into the War Industries Board, but it is now plain that there was a succession of confusions of function and powers between these two bodies which occupied a field that was in its nature not divisible. THE WAR INDUSTRIES BOARD EMERGES 61 These defects in the general war machine were the inevit- able result of evolution mixed with definite legislation. The ofi'setting advantage is the probability that no a priori statute could have efi'ected so adaptive a composite as was finally achieved. The work of the Board finally resolved itself into twelve well-defined functional parts or implements of utilization of its various powers and discharge of its duties. These were "Priorities," the Clearance Office, the Conservation Division, the Resources and Conversion Section, the Industrial Inven- tory Section, the Facilities Division, the Advisory Committee on Plants and Munitions, the Labor Division, the Technical and Consulting Section, the Purchasing Commission for the Allies, the Division of Planning and Statistics, and Price- Fixing. The direction of these functional implements found its data and its media of contact with industry in (ultimately) some sixty commodity sections corresponding to as many groups of industries. Thus the field of the Board's work was divided into twelve agencies of purpose on the one side operating through sixty "action" sections. Coming now to the administrative method by which func- tions were exercised and tied in with the chairman at one end and the commodity sections at the other, we have first a Board of ten members, which at the signing of the armis- tice consisted of Mr. Baruch, chairman; Alexander Legge, vice-chairman; E. B. Parker, Priorities Commissioner; R. S. Brookings, chairman of the Price-Fixing Committee; G. N. Peek, Commissioner of Finished Products; Rear Admiral Fletcher, representing the navy; Major-General George W. Goethals, representing the army; J. L. Replogle, Steel Administrator; Hugh Frayne, Labor Commissioner; L. L. Summers, technical adviser. H. P. Ingels was secretary of the Board, and H. B. Swope, Clarence Dillon, Harrison Williams, and Harold T. Clark, assistants to the chairman. Harry P. Bingham preceded Mr. Ingels as secretary. As administrators all members of the Board except the army and navy members (whose function was not at all adminis- trative) and the chairman of the Price-Fixing Committee were directly subordinate to the chairman, who, however, }f 1 r 62 INDUSTRIAL AMERICA IN THE WORLD WAR was a member of the Price-Fixing Committee. Under Com- missioner Parker were the Priorities Board and the Priorities Committee and the non-war construction section. The Price-Fixing Committee had no directly subsidiary bodies, but worked with the diflferent commodity sections regardless of their administrative location. Mr. Legge had the Require- ments Divisions, the Clearance Office, the Allied Purchasing Commission, certain raw materials sections, a number of other sections, and the special advisory committee on plants and munitions. Mr. Peek had five groups or divisions of commodity sections and the Facilities Division; Mr. Frayne had, besides the duty naturally falling to his office, the War Prison Labor and National Waste-Reclamation Section; Mr. Replogle had certain sections relating to steel; Mr. Summers had all technical matters. The Conservation Division was not headed by a member of the Board, but operated directly through its chairman, Mr. A. W. Shaw, under Mr. Baruch. It will be observed that there is considerable conflict of nomenclature in respect of sections and divisions and that the administrative chart shows such an important function as that of resources and conversion far away from the head, but that is the fault of the chart rather than of the fact. The different phases of function and commodity organization will be discussed and analyzed in the chapters devoted to the functional divisions and commodities, but an important gen- eral concept to keep in mind is that the War Industries Board was not a neat little administrative bureau trimly set apart. Through membership in the Board or its committees, in its divisions and its sections, virtually every department of the Government and all the other special war agencies were directly connected with the chairman of the War Industries Board. Every civil ramification of the tentacular war machine thus came under his influence if not his control — for by helpful courtesy if not by authority some of the functions of every department of the Government were made subsidiary to the judgment of the War Industries Board. It thus became the central "control" of finance, internal commerce, foreign commerce, domestic industry, foreign and neutral industry, shipping, railways, fuel and food, and the THE WAR INDUSTRIES BOARD EMERGES 63 army and the navy whenever the discharge of its basic func- tions made it necessary for it to be such. Herein was the finest fruit of an evolved rather than legislatively created organism. Being without statutory definition and limitation, it grew, fed by what it did or must do, into the direction of all things pertaining to the prosecution of the war. Wherever it penetrated, it was so much its own manifest justification that it never gave off'ense. No formally created department of the Executive could have been so adaptive, so permeating, so all-inclusive without friction and without off'ense. So quiet and unobtrusive were the extensions and pro- jections of this central control that to this day there is little general understanding that through the War Industries Board the United States had in the end a system of concentration of commerce, industry, and all the powers of government that was without compare among all the other nations, friend or enemy, involved in the World War. It was both the peculiar characteristic and the high merit of this organization that it was so interwoven with the supply departments of the army and navy, of the Allies, and with other departments of the Government that, while it was an entity of its own, exercising virile authority, its decisions and its acts, if not always representing the unanimous judgment of all officials and agencies of Government involved, were always based on a conspectus of the whole situation. At the same time, through the commodity divisions and sections in contact with responsible committees of the producers of the commodities dealt with, the War Industries Board extended its antennae into the innermost recesses of industry. Never before was there such a focusing of knowledge of the vast field of American industry, commerce, and transporta- tion. Never was there such an approach to omniscience in the business aff*airs of a continent. Thus the War Industries Board knew currently all that could be known of war demand and all that it was humanly possible to gather concerning the resources and facilities with which to meet it. This universal understanding was amal- gamated with an executive administration which, by the exer- cise of clearly defined functions, effected the orderly meeting ¥. 4 "iu n M f 64 INDUSTRIAL AMERICA IN THE WORLD WAR of supply and demand, of resources and requirements. All comprehensive in its knowledge and understanding, coopera- tive and tolerant in its relations, clear and definite in pur- poses and the means thereto, prompt and firm in execution, the War Industries Board stood forth in its final form as the supreme incarnation of the economic power of the Repub- lic, disciplined, coordinated, and stripped for war. I ill CHAPTER IV THE PERSONAL ELEMENT Banich — Conscripting the brains of industry — The dollar-a-year man arrives — Seeking the industrial doer — Willard — Scott — Legge — Peek — Replogle — Parker — Brookings — Summers — Frayne — Fletcher — Johnson. Administrative and executive organizations susceptible of beautiful charting, that shows each duty, authority, and func- tion as definitely defined and as reciprocally articulated to each other and the controlling head center as the parts of physical mechanism, do not make such entities any more than finely phrased constitutions make nations. The Constitution of the United States did not make the great Republic and the constitutions of its many imitators have not sufficed to remake them. Full-fledged in the end in its endowment of effective power, however miscellaneous and piecemeal that endowment was, the War Industries Board would have failed had it not been for the exceptional quality of its personnel. The writer came out of war work with no more definite belief than that. It was undoubtedly the greatest gathering of able business men into a single public enterprise necessitating energetic and continuous effort by each and all that this country, and, indeed, the world, has ever known. If you can visualize a convention of able, if not the ablest, men of affairs of America — not so much the presidents and chairmen of boards, whose hard-working days are over, but the keen, dynamic, forceful, purposeful, transilient vice-presidents and managers and superintendents; not the men who are reputed to be doers, but the real doers of the colossal deeds of the titanic American industrial scene — removing their coats, rolling up their sleeves, and marching in a body to take agreeable, assigned positions in a super-corporation, you will view the War Industries Board. When one reflects that it was such a unique group that for months on end thought and toiled for the public welfare, / 1.^ J I 66 INDUSTRIAL AMERICA IN THE WORLD WAR without pay or thought of substantial reward, he is prompted to speculate on what might be accomplished by the collec- tively powerful but feebly acting machinery of the State if such men were to administer its affairs. Manning the War Industries Board, led by a man with a touch of genius, they bridged with the personal element all its organic lapses and filled with intelligent initiative all hiatuses of power. Somewhat anomalously, it might be thought at first glance, the man finally chosen to direct this supreme executive of industry was not himself an industrialist. Baruch was pri- marily a speculator and later a creative investor. He was neither a captain of industry nor a merchant prince. He had never created a great industrial organization nor admin- istered a large business. He had had no complex executive experience. Great as was the wealth he had amassed, he virtually kept no books. Vast as was his information of American economic matters, the principal repository of it was in the card index of his mind. But though Baruch was not of industry, he knew it and had that very substantial proof of knowledge — a fortune gained in applying it. From an external coign of vantage in the Congress of American business in Wall Street, he had studied American business with the cold detachment of one seeking to profit from knowledge. He had examined indus- try as a biologist scrutinizes life — organically and func- tionally. He developed a somewhat startling ability to deduce facts from figures and the event from the process. Facts gathered, deductions made, he was unswerving in back- ing his judgment; he was immune to panic and impervious to the excesses of enthusiasm. Unaffected by the street gossip that rallies or disperses the common run of specu- lators, Baruch was as sensitive as mercury to heat and cold to all the elemental facts, rising from a continent of industry, that in the long run determine all values. Cool in judgment, remorseless in decision, methodical in action, he is never- theless a man of susceptible emotions, impulsive, kindly, sympathetic, of extremely catholic human interests and com- pletely devoid of pride of purse. He made his money in Wall Street, but he took neither his politics nor his economics from it. I Chairman of the United States War Industries Board; Member of the Advisory Commission ot the Council of National Defense in charge of Raw Materials, Minerals, and Metals; Member of the Allied I'urvhdsiug Commission; Member of the Supreme Economic Council IL INTENTIONAL SECOND EXPOSURE I 66 INDUSTRIAL AMERICA IN THE WORLD WAR without pay or thought of substantial reward, he is prompted to speculate on what might be accomplished by the collec- tively powerful but feebly acting machinery of the State if such men were to administer its affairs. Manning the War Industries Board, led by a man with a touch of genius, they bridged with the personal element all its organic lapses and filled with intelligent initiative all hiatuses of power. Somewhat anomalously, it might be thought at first glance, the man finally chosen to direct this supreme executive of industry was not himself an industrialist. Baruch was pri- marily a speculator and later a creative investor. He was neither a captain of industry nor a merchant prince. He had never created a great industrial organization nor admin- istered a large business. He had had no complex executive experience. Great as was the wealth he had amassed, he virtually kept no books. Vast as was his information of American economic matters, the principal repository of it was in the card index of his mind. But though Baruch was not of industry, he knew it and had that very substantial proof of knowledge — a fortune gained in applying it. From an external coign of vantage in the Congress of American business in Wall Street, he had studied American business with the cold detachment of one seeking to profit from knowledge. He had examined indus- try as a biologist scrutinizes life — organically and func- tionally. He developed a somewhat startling ability to deduce facts from figures and the event from the process. Facts gathered, deductions made, he was unswerving in back- ing his judgment; he was immune to panic and impervious to the excesses of enthusiasm. Unaff'ected by the street gossip that rallies or disperses the common run of specu- lators, Baruch was as sensitive as mercury to heat and cold to all the elemental facts, rising from a continent of industry, that in the long run determine all values. Cool in judgment, remorseless in decision, methodical in action, he is never- theless a man of susceptible emotions, impulsive, kindly, sympathetic, of extremely catholic human interests and com- pletely devoid of pride of purse. He made his money in Wall Street, but he took neither his politics nor his economics from it. I III ii -I ^^^.^t^t^yC^t^y^-^^ >^^^ < - Chairman of the I niterl Ftates War Industries Board; Member of the Advisory Commission ot the Council of Nationnl Defense in charpe of Raw Materials. Minerak, and Metals; iviember of the Allied I'urvhasi.ig Commission; xMember of the Supreme Economic Council Wit * THE PERSONAL ELEMENT 67 \W m [I I 1 M I As with the source of his ability, so was his ultimate interests in things and in people. He was a Roosevelt adher- ent when Roosevelt was anathema in the high places of business; he was an early supporter of Woodrow Wilson and "the New Freedom" when big business was scornful. A conservative at twenty-five, he was a liberal at forty. His substream seems to have been Americanism. Apprehensive that war was on the cards, he began as early as 1915 to reflect on the relations between modern war and that huge camp of industry with which he was so familiar from coast to coast. He was the first subscriber to Leonard Wood's Plattsburgh Training Camp, and, in that same year, he called on President Wilson and made suggestions regarding the shaping of industry for its part in the shock of battling nations that went to the very roots of the matter. It is char- acteristic of him that, though he had supplied generously sinews of war for the Democratic national campaign of 1912, ' his first call at the White House was purely impersonal and on the business of the public. His appointment in October, 1916, to serve on the Advi- sory Commission of the Council of National Defense was as welcome as it was unsolicited. He began forthwith to apply to the inevitabilities of the hour all his great knowledge and understanding of the resources of America, much as he had formerly applied them to the conflicts of Wall Street. He gravitated naturally in the Commission to the ultimate sources of economic power — to raw materials and facilities of their conversion to use. With his grasp of them, with his wide and deep understanding of industrial processes, ramifications, and interdependences, he was peculiarly quali- fied from the beginning for the place of power that ulti- mately came to him. Baruch reveres facts. He applied laboriously collected and carefully digested knowledge to a Wall Street that ebbs and flows to the impulse of rumors and reports, and netted his fish indiff'erently with the outward or the inward current. In a Washington of "guess" and "estimate," "think" and "about," he pursued the definite decimal-point fact. His great conception of the commodity sections came from his profound belief that first of all there must be reliable knowl- I in I v^ ' I I > 68 INDUSTRIAL AMERICA IN THE WORLD WAR 1 I edge of the factors of all war-time problems. With the com- modity sections behind him, he had the facts, as nobody else had them. Digested by his penetrating power of analysis and applied with his airline judgment, he had a grasp of everything he dealt with in Washington that really put him in a higher rank than any of the great captains of industry. It is something of a mystery that the President, knowing and appreciating Baruch as he did, did not lean more on him and advance him more rapidly to the high command of industry mobilized for war. The truth probably is that he feared that in public estimation Baruch was too fresh from Wall Street. On the other hand, Baruch, though ardently ambitious to participate in the world of effort, is not a good self-promoter. Whether it proceeds from affectation or modesty, the one-time brilliant Wall Street operator seems to be positively timid in his first mingling with a new environ- ment. Assigned to raw materials, of which coal is perhaps chief, he unprotestingly surrendered it to Secretary Lane, from whom Secretary Baker took it away, with the result that a separate coal administration arose. He excused this sur- render later by saying that coal was a "porcupine that he was glad to let go of." He must many times have wished that same porcupine, quills and all, back in his hands. Whatever the cause, the fact remains that the man who could certainly have done in the fall of 1917 what he did in the spring of 1918, was passed over for many months after he had demonstrated to all close, unprejudiced observers that he was marked for leadership. There is some unwritten history here that has never been and may never be told. It is known that early in the war President Wilson had the intention of making Mr. Baruch general purchasing agent for the Government. Yet, in the latter part of 1917 and early part of 1918, when Baruch was the logical man to have thrown into the industrial gap, and the War Department was beginning to utilize Mr. Stettinius, the President waited and deliberated for months. It was not only that he did not raise up the man, but that he let the place drift and disintegrate, though Mr. Willard, with clear insight, had pointed out to him that the one thing to do was to amputate the War Industries Board from the Council and THE PERSONAL ELEMENT 69 launch it, surcharged with authority, against the menacing disorders of the period. The indecision was likely the product of tangled congeries of doubts and conflicting policies and personalities. There was the pull for a Department of Munitions, there were antip- athies to Baruch, aroused among many close to the Presi- dent by Baruch's original ways of getting things done — and there was still the bogey of Wall Street origin, which had not been dissipated by the unparalleled success of Baruch m effecting, by appealing to the patriotism of Wall Street, slashes in the prices of copper, nickel, tin, lead, and steel, that set the fashion and moulded the motive of war cooperation. The President's hesitation is all the more perplexmg when it is considered that Baruch was near to him and that he was near to Baruch. The chances are that Baruch could have tipped the scales to action by a single picturesgue sentence in his own behalf. It is probably to be put down to his debit that he did not submerge personal advancement in the cause of the public good. In a time of clashing worlds and smashing customs there was no place for personal diffidences, however honorable to their possessor. He knew the crying demand for leadership, and was conscious of his own capac- ity for it. He was by then attuned to public life, and yet he did not push himself forward when to do so was public duty. Besides his natural qualities and his peculiarly fitting experience, Baruch had certain advantages when he did come into power that none of his predecessors had. His great wealth was a distinct asset. It made him independent of the material considerations that would have harassed a poor man in his place. The nature of its acquisition made him independent of all bias or obligation to the "interests." The bigness of it put him on a plane of equality and familiarity with all comers. Sixty million dollars, incarnate in Judge Gary, opulently set in the two billions of the Steel Corpora- tion, in Baruch's eyes bred none of the dignity that doth hedge kings. He had no past favors to reward or future benefits to cultivate. His fortune was stuck to none of the great interests. He had never drawn a huge or any salary or emolument from any of them. He looked forward to no 1' ■ « .1 ' I, m 1 70 INDUSTRIAL AMERICA IN THE WORLD WAR associations with them. He was of Wall Street, but he was its Ishmael. He had made his money by pitting his knowledge of men and things and his judgment of events against those of the greatest masters of industry and commerce. He respected the monarchs and nobles of the realm of industry and finance, but they had no fears or favors for him. For him they wore no halos and emitted no sanctities. Perhaps it was because he accumulated his wealth by raiding their preserves that he became a Democrat in politics and some- thing of a radical in economics. But regardless of his unafraidness, his practice of equality, there was an advantage to Baruch derived from his wealth and his business success. Poets esteem each other according to the merit of their verses; men of affairs measure each other by dollars. The chairman of the War Industries Board was rated high by that standard. Although he was on the opposite side of the table, big business men liked to deal with him because he talked their language, even if he did it to their disadvantage. He was not saturated with theories lacking the heat treatment of practice. He dealt with facts and with experience. Instead of preaching he traded, instead of commanding he bargained. The peculiar quality of his bargaining as a Government representative was that he was able to invoke sentiment. In more sordid times it might or not have worked. In the war it circulated at par. Cynics scoffed then and will scoff now — but it is a fact that business came to serve partly for the meed of service. This was truer of the basic industries — with which Baruch primarily dealt — than it was of the secondary ones. He would not tolerate profiteering. Placed at the head of another War Industries Board in another war, Baruch, as his report says,^ would draft dollars as well as men from the start. As it was, his drafts of industry were extensive. Here, too, his hands were free. He had drafted himself and his dollars. He so arranged his affairs that not a dollar of profit came to him out of the war. If there was doubt, he gave the Government the benefit and turned the dubious item over to the Red Cross. In the case of one great industry ^American Industry in the War, p. 81. I THE PERSONAL ELEMENT 71 m in which he had a large interest, an industry that was making a product which the Government must have, he directed that the company should supply the Government on an absolute cost basis. He gave the Government all his time without compensation and retired altogether from active business. When he might have doubled his fortune in Wall Street in years that were open doors of speculative opportunity, he was as out of it as if he had never been in it and was spending his reserves — in more than one instance — in paying bills that were really Government charges. Nothing was delayed because of a lack of appropriation if Baruch knew it. An example in point will be related later in con- nection with that lively and super-efficient projection of the War Industries Board, the Foreign Mission. Baruch had one very important external advantage that his predecessors did not have. He had warm supporters in high places. Not only was the President for and with him, but McAdoo, Secretary of the Treasury and Director- General of Railroads, with one hand on the till of the mightiest of all treasuries and the other on the throttle lever of the greatest of all transport agencies, always stood behind Baruch like a brother. In any moment of doubt or weak- ness, McAdoo, speaking for vast powers, was there with substantial reinforcements. All who came in contact with Baruch when he was chair- man of the War Industries Board were impressed by his simplicity of motive. Inspired by patriotism of the highest and intensest order, he had one single objective — the winning of the war. His mind had no room for intrigue and the advancement of personal ambitions, large or small. Aside from the contributive value of his environment and experience, Baruch possessed inherent qualities that fitted him for his great office. One of these was his unfailing, good-natured, tolerant patience. All of his associates com- ment on his patience. His good-humor was unfailing. His smile was perennial; he was never too tired or too engrossed to smile. Optimist that he is, that smile must many times have masked a profound depression. Baruch's power of swift and unqualified decision, which was one of the greatest factors in his success with the War Industries Board, is the II • V 72 INDUSTRIAL AMERICA IN THE WORLD WAR I It I child of his courage. He never quailed before any responsi- bility of decision no matter how momentous. Reference and deference are the curses of lumbering bureaucracies. Impressed with the importance of decision, it was Baruch's habit swiftly to assemble the facts and arguments and quickly decide. President Wilson was not lacking in decision, but he was wont to wait for events to unfold more data. Baruch took the current data and decided, well under- standing that paralysis is more dangerous than error. Simplicity of manner was another quality that helped him greatly. He took on no airs with power. A certain boy- ishness marked all his doings. He worked with zest and not with carking care. He liked it. He was never too pre- occupied to ignore small talk. Whenever possible, he renewed his strength from social intercourse. Not much given to press-agenting his own activities (too little so for his official impact, in the writer's judgment) , he delighted in the daily meeting with the newspaper men. With them he chaffed and was chaffed. The strain was great, but it was a great game. Wall Street was a little thing to playing with the resources and facilities of a nation and of nations. Negotiating with Chile for nitrates or with Spain for mules for Pershing was high adventure. To get the nitrates he "beared" them with plans for synthetic nitrate; to get the mules he "bulled" the ammonia that was exchanged for them. Jute could not be obtained from India, it seemed, because India was an independent empire which could not be controlled from London; but London found a way to control when it was made plain that America might not be able any longer to pour silver into the Indian mints. Truly this was an absorb- ing role for a prince of traders. Life in the War Industries Board was a succession of big things, full of thrills. Baruch, nervous and impulsive, found full outlet for his impetuous energies and the outgo kept him cool and calm. The procession of great enterprises left no opening for staleness. With no natural talent for detail, indeed, with a distinct dislike of it, Baruch had devel- oped a great capacity for it. His photographic memory, which is automatic and records without concentration, leads THE PERSONAL ELEMENT 73 him to a neglect of even systematic personal records and files. Lost papers in the War Industries Board were usually found in Baruch's pockets after futile search had been made every- where else. He knew their contents, but had forgotten that they were in his pocket. His passion for accuracy might have led to his undoing through a blinding absorption in detail, if he had not surrounded himself with able lieutenants. But here another quality came to his aid, and that is his almost unfailing judgment of men. He picked masterful minds to be his coadjutors, and so great was his confidence in his judgment that he conveyed to each of them in his particular field all the authority he had received — and more. And this sug- gests a diversion. Baruch was deeply impressed with the idea that a nation at war has so much at stake that the rigidity of laws and conventions of peace are automatically and necessarily suspended — that the preservation of the nation becomes a law above constitutions. He found his justification in Lincoln, who thought it more incumbent upon him to preserve the Nation than the integrity of the Consti- tution. Baruch gave authority and credit and took all the responsibility without hedging or reneging. His lieutenants never feared a fire from the rear. They were all well adapted to the central idea of industrial self-control for patriotic purposes. They were from indus- try and would have resented dictatorial methods had they remained in it. They knew just how the men at home felt. They were also simple, democratic Americans. A surpris- ingly large number of them came from the Middle West, Legge, Peek, and Shaw, for example. Naturally they would have favored regulation of industry by consent rather than by rigid rule, even if the evolution of the War Industries Board from the nucleus of voluntary help instead of from superimposed law had not given it that character long before it had teeth. They fitted admirably into the conception of industry imposing from its best judgment its own rules and regulations and self-administering them. The War Industries Board was the least bureaucratic of organizations. It was really the town meeting of American industry curbing, disciplining and devoting itself. There ) I '*>« f I 1 I 74 INDUSTRIAL AMERICA IN THE WORLD WAR was the result that the greatest of the industrial nations eventually exercised a more far-reaching and compelling control of industry than did any other of the warring coun- tries, and yet accomplished it at a comparative trifle of overhead and v»ith a mere handful of executives and a few hundred clerical helpers — not as many persons on the official roll, all told, as a single bureau of the British wool control had. American industry virtually imposed on itself, through the clearing-house of the War Industries Board, its own rules and then policed itself with a view to their enforce- ment. It is to the everlasting honor of American business and to the vindication of our democracy that the rules were better for the public interest and better enforced than like ones among friends or enemies. When the end of the war came, it did not find American industry enmeshed in war-time laws and regulations which it would take years to shake off. On the contrary, about all it had to do was to relax its own rules and change its objectives from those of war to those of peace. In the writer's opinion, the change was made too abruptly, but that is another story. It cannot be said too often — and there will be reiteration of it in this book — that the original feature of the War Industries Board was its successful, cooperative, democratic, self-control of industry for national purposes. Baruch had an instinct for management that more than made up for any lack of executive experience in connection with great administrative machines that might have been his. Having entrusted power to his chiefs and sections, he kept out of sight. He discouraged any tendency to pass matters on to him for the final visa. He absented himself from committee and subdivision meetings where he might well be expected to appear because of the major importance of the things under consideration. Even in such cases he did not reserve the right of veto. Only in the event that his lieu- tenants could not decide because they could not agree did Baruch intervene. These methods of procedure worked wonders in putting driving power into the work of the War Industries Board. The paralyzing fear of reversal by a higher authority was removed. Decision being concentrated ^ THE PERSONAL ELEMENT 75 became strong. Not participating in the work of his department chiefs, Baruch remained detached; advantage- ously placed to view the whole machine, see its external contacts and steer its general course. Not brought into personal friction with champions of conflicting or obstructive business interests, Baruch in the background was the bogey man, the final repository of power, the Zeus of the Olympus of Industry who was to be propitiated by settlements instead of appeals; whose portentous potentialities were not to be lightly invoked. People soon learned that with Baruch at the head of the War Industries Board, it was useless to insist on seeing the man higher up in preference to a divisional chief. It was not hard to see Baruch, if they insisted, but they learned that it was a waste of time — for in this organization the men lower down did not merely interview; they decided, not as the basis of an appeal, but as finality itself. Sub-executives who are forever subject to appeal and frequently to reversal cease to be executives in initiative as well as in performance. Preferring error to inaction, Baruch did not expect per- fection of his associates; but incompetence was met with elimination, not with correction. It was the only system that would command the devoted loyalty and best eff'orts of strong and able men, of men who are willing to sink or swim on their records, but who insist on a clear field in their departments. From this system, which Baruch describes as decentraliza- tion of authority (which is, however, predicated on the primary establishment of an unquestioned source of author- ity and responsibility), flowed a remarkable product of energetic action. "Here is a job," Baruch would say, or indite a hasty memorandum to one of his "boys." He might cite some of the elements and indicate the objective, but as to how the job was to be done he gave no hint. "I'm on the job," would be the answer — and nine times out of ten that was the last Baruch would have to do with that matter. It was off his mind and he was free to go on with his assign- ments. In this way Baruch, as the great coordinator of governmental instrumentalities, did not fall into the error of littering up his own establishment. II u i 7 I i I I' I lU 76 INDUSTRIAL AMERICA IN THE WORLD WAR With such a company around him enjoying such a whole- sale delegation of authority, Baruch's mind was free to its impulses and intuitions. He could move rapidly at will around the Washington scene, receptive to suggestions, open to thought, and with free outlet and prompt application of the plans that struck fire in his luminous mind. He may be fairly called a great executive. He is essentially a creator, and yet he has a marked talent for inspiring action and devoted loyalty. Baruch could not have succeeded as he did, however, if he had been merely mind without character. The writer does not always agree with his mental processes — though they are always arresting — but no one who knows Baruch could ever question the integrity that runs like a sensitive current throughout his entire make-up. When the last word is said, it was Baruch's character that saw him through, that and his incessant courage, marvelous intuitive judgment, and patience. The writer freely confesses that he was one of those who, in the early days of the war, doubted the capacity of Baruch to master a situation so full of dynamic and loose ends, and he finds a certain intellectual pleasure in thus recording his final judgment of Baruch's contribution to the war. The executives of the War Industries Board were mostly young — scarcely any were over fifty — and coming rather than going men. Their names^ did not always mean much to the public, but they were impressive in industry. They were men in the active middle of their careers; men who were then doing the things that would make them famous later. To a large extent, too, they were independent of patronage for the development of their careers. Either they were not salaried men, or their ability was so conspicuous that they had no cause for worry about their futures. They were able to cut loose from and rise above their previous associations in serving the public. It should not be inferred from this, however, that, in choosing these yoimger and more virile executives to act officially for the Government, the counsel and influence of *Sec Appendix for list of War Industries Board executives, giving their business aMiiations as of the war period. I 4 THE PERSONAL ELEMENT 77 the men who loomed greater in the public eye was lost. These older men, these greater figures, at any rate, were of the greatest assistance to the Government on or through the trade committees which represented industry in its manifold contacts with the War Industries Board. In the beginning, in the early days of the Council, it will be remembered, they represented the Advisory Commission directly. The Council and the Advisory Commission did many great things, but they never did a greater one than enlisting the so-called dollar-a-year men. They thus opened the door for ingress to Government of the truly able men of the Nation, who in ordinary times are in business and not in Government. The ineradicable belief that no man is great enough to rise above the selfish impulses of his own business kept them in the background to a large extent, especially in the early days of the war. There resulted a terrible waste of time and ability. Men of the rarest capacity were doing clerical work in Washington; others were not there at all. But the business committee system made them emergently available, even though not in a publicly conspicuous way. It did more than that. Even when the war service committees were strictly segregated on the private side of the fence and were frankly acting for industry rather than for the Government, every one of them had a great consciousness of an over- topping public duty. First to last, through this invocation of the great ability of America, all the knowledge, all the experience, all the energy of the greatest pool of strong men to be found in the whole world was available. As the war went on, the public came to demand the services of these men, regardless of the ancient prejudice — and so men like Baruch, Stettinius, Lovett, Schwab, Franklin, John D. Ryan, and many others of their caliber were called to the front-line trenches of industry in the war. The reluctance at first to give power to those who could use it, for fear they would abuse It (and delegating it to those who did abuse it because they could not use it), is one of the reasons why the war machine took time to evolve. It is doubtful, though, the popular mmd being what it is, whether either Mr. Willard or Mr Baruch could have "got away" with the appointment ot Judge Gary as steel administrator, so conspicuously the master was he of his great industry. 4 II ) ll I 78 INDUSTRIAL AMERICA IN THE WORLD WAR It was in the coming out of these men — the private earn- ing capacity of their kind in the War Industries Board alone was said to have been $35,000,000 a year — that democracy was vindicated. Germany was collectively efficient and ready for war because she was ruled by an oligarchy that took thought and pains. The United States was collectively — meaning the State — inefficient and unready because it was ruled in peace by the crowd, which does not take thought. The best minds of Germany were in the State in time of peace; the best minds in America were not in the State. But the State did the thinking for all Germany and attended to all initiative; hence there were slender reserves of ability outside the bureaucracy and the talent within had become mechanized by discipline and routine. The United States, on the other hand, had an almost unlimited reserve of executive, technical, and professional ability which was of exceptional value just because it had not hitherto served the State. In the emergency it turned to the work of the State with zest, refreshing originality, and keen vigor. If we could always have such men in public life and service, we should be blessed with a government efficient and beneficial. But it is the paradox of the problem that, if we had them there, we should not have them swarming in industry and building up reserves of talent subject to call. Democracies pay for private efficiency with public inefficiency. There were many men in the Government service, not technically doUar-a-year men, who were of the same type and whose sacrifice was greater. These were able men of large earnings or salaries, but without sufficient savings to stand a long period without income. They accepted the small salaries, rarely ever more than three thousand to six thousand dollars, that it was possible to pay them, and reduced their living scale accordingly. One man, for example, who had been drawing a salary of twenty-five thousand dollars a year, lived in a hall room in Washington and patronized the cheap restaurants in order to serve the War Industries Board. For some of the doUar-a-year men there was no great personal sacrifice. Some had independ- ent fortunes and others had their burden assumed by their THE PERSONAL ELEMENT 79 former employers. Some of the men who were able to carry themselves did, however, make a trernendous sacrifice in that they not only gave a year or two of time in the best periods of their lives, but deprived themselves of unequaled opportunities to make fortunes. In Washington they lost opportunity, worked in obscurity, and in some instances suffered undeserved disgrace. One such executive gave .up salaries amounting to eighty-five thousand dollars a year and certain profits several times as large. It was one of the important functions of the Advisory Com- mission that it served as a clearing-house for the services of men who were eager to help. The man and the place were brought together — not only in the Commission's own sphere, but throughout the Government; for in the war establishments and in all the regular departments and special war agencies there was an almost unlimited demand for executive ability that could not be met through civil service channels. For many months the Advisory Com- mission was about the only center in Washington where there was anything like a clear general view of the multi- tudinous activities of Government in the great emergency, and it was thus of vast assistance, not only in supplying needed men, but also in giving needed information to thousands of bewildered persons who were endeavoring to find out how they could assist in their private capacities as manufacturers and professional men. To depart a little from the clear course of this discussion, it might be added that the Advisory Commission acted similarly as a clearing- house of information, suggestion, and inspiration to the whole country. "History will never be in a position," says an editorial in the "New Republic," "to chronicle, because these last four years have glutted it with centuries of material, all the heroic deeds at the front, or all the sacrifices behind the lines; and while our dreams may never become more tangible than dreams, and the 'Business Administration' still be a goal for the aspiration of future generations, the foundation has been laid and the material proved to be available in the existence in our national fabric of the qualities which are personified these days in the 'dollar-a-year man.' " M' II :i 80 INDUSTRIAL AMERICA IN THE WORLD WAR Daniel Willard deserves a high place on the record of personalities. In a way, and consciously, too, he made a supreme personal "sacrifice hit" for the War Industries Board. It has been explained how in the "dead center" times of the fall of 1917, when evolution was not evolving, this executive, displeased with the lack of progress, the delay in centralization, the ooziness of industrial control, and his failure to secure the authority that he knew was indispensable to success, decided to resign and go back to the president's office of the Baltimore & Ohio Railway. The great thing about this resignation was that it was a personal sacrifice. He left the office to make it. He could not get authority, and no big man would therefore take it, as it was, for the same reason that Willard left it. It has been said that one reason why the President did not accept the suggestion of the creation of a Department of Munitions was that it required a superman at its head — and he could not find one. If there were no supermen, there were some exceptional men, and they would not accept positions of super-names and inferior authority. By his resignation Mr. Willard thus forced the caliber of the War Industries Board chairmanship up to an equality with great, if not superman, ability pending the discovery of the super- man. So Baruch got what was denied to Willard. The masterly manner in which Willard, as chairman of the Advisory Commission, initiated and directed the preven- tion of the threatened general strike of railway men on the eve of the war, and his work in mobilizing voluntarily the transportation facilities of America under private manage- ment, are enough to give him a great place in the history of the war behind the lines. As the railways were taken over by the Government at the end of 1917, the railway men have not been given latterly so much credit as they deserve for what they did voluntarily in promoting the successful waging of the war. Despite the representations of the Attorney-General, who was intent upon enforcement of the laws that operated to keep the railways from acting together in the manner demanded by the necessity, the railways achieved wonders in unification of transportation. On the slightest suggestion III 'i DANIEL WILLARD Chairman of the Advisory Commission of the Council of National Defense and the second Chairman of the War Industries Board FRANK A. SCOTT The first Chairman of the War Industries Board SAMUEL GOMPER8 lyfembsr of the Advisory Commission of the Council of National Defense representing Labor ROBERT S. LOVETT Member of the War Industries Board in its early organization INTENTIONAL SECOND EXPOSURE / ( I I I, 80 INDUSTRIAL AMERICA IN THE WORLD WAR Daniel Willard deserves a high place on the record of personalities. In a way, and consciously, too, he made a supreme personal "sacrifice hit" for the War Industries Board. It has been explained how in the "dead center" times of the fall of 1917, when evolution was not evolving, this executive, displeased with the lack of progress, the delay in centralization, the ooziness of industrial control, and his failure to secure the authority that he knew was indispensable to success, decided to resign and go back to the president's office of the Baltimore & Ohio Railway. The great thing about this resignation was that it was a personal sacrifice. He left the office to make it. He could not get authority, and no big man would therefore take it, as it was, for the same reason that Willard left it. It has been said that one reason why the President did not accept the suggestion of the creation of a Department of Munitions was that it required a superman at its head — and he could not find one. If there were no supermen, there were some exceptional men, and they would not accept positions of super-names and inferior authority. By his resignation Mr. Willard thus forced the caliber of the War Industries Board chairmanship up to an equality with great, if not superman, ability pending the discovery of the super- man. So Baruch got what was denied to Willard. The masterly manner in which Willard, as chairman of the Advisory Commission, initiated and directed the preven- tion of the threatened general strike of railway men on the eve of the war, and his work in mobilizing voluntarily the transportation facilities of America under private manage- ment, are enough to give him a great place in the history of the war behind the lines. As the railways were taken over by the Government at the end of 1917, the railway men have not been given latterly so much credit as they deserve for what they did voluntarily in promoting the successful waging of the war. Despite the representations of the Attorney-General, who was intent upon enforcement of the laws that operated to keep the railways from acting together in the manner demanded by the necessity, the railways achieved wonders in unification of transportation. On the slightest suggestion i DANIEL WILLARD Chairman of the Advisory Com mission of the Council of National Defense and the second Chairman of the War Industries Board FRANK A. SCOTT The first Chairman of the War Industries Board I !;! ^.^11 ill. li I !) i'll I ' / SAMUEL GOMPERS Member of the Advisory Commission of the Council of National Defense representing Labor ROBERT S. LOVETT Member of the War Industries Board in its early organization THE PERSONAL ELEMENT 81 I w i I 1 I J from Mr. Willard, 631 railway companies, operating 262,000 miles of line, were devoted primarily to Govern- ment service — and the general administrative expense involved was met by them. For eight months, an executive committee that came to be known as the Railroads War Board sat continuously in Washington, ready to respond to every suggestion that might be made by Mr. Willard acting as contact officer for the Government — and this board, with Mr. Willard and Interstate Commerce Com- missioner E. E. Clark added to it, was also the central committee of the Council of National Defense on railroad transportation. There were, besides, six regional and other committees continuously on the job. The war was but five days old when this committee was created at a meeting of the executives in Washington called by Mr. Willard in response to a resolution adopted by the Council of National Defense introduced by Secretary Lane. Without delay or consultation with directors and stock- holders the executives that same day adopted this resolution: Resolved, That the railroads of the United States, acting through their chief executive officers here and now assembled, and stirred by a high sense of their opportunity to be of the greatest service to their country in the present national crisis, do hereby pledge themselves, with the Government of the United States and with the Government of the several States, and one with another, that dur- ing the present war they will coordinate their operations in a con- tinental railway system, merging, during such period, all their merely individual competitive activities in the effort to produce a maximum of national transportation efficiency. To this end they hereby agree to create an organization which shall have general authority to formulate in detail and from time to time a policy of operation of all or any of the railways, which policy, when and as announced by such temporary organization, shall be accepted and earnestly made effective by the several managements of the indi- vidual railroad companies here represented. This is not the place to go into the history of the great achievements of the railways thus unified for war service, but the prompt and comprehensive manner in which it was done does great credit to the patriotism of the railway executives and throws light on what manner of executive lit IM i* II f 82 INDUSTRIAL AMERICA IN THE WORLD WAR Daniel Willard was in the Government service. The country was profoundly stirred by the speedy and friction- less mobilization of the railways. It was dramatic in gesture and practical in action. It must not be forgotten that it was all done before the military establishments had given any thought to the transportation involvements of war. One wonders if it would not have been better in the end if the principle of democratic cooperation and control had been applied throughout to the railways, as it was to industry. It was largely due to Willard's good temper and steadi- ness of purpose that the Advisory Commission had no destructive dissensions and that able men were held in the War Industries Board in the period of doubt and delay, and it is chiefly due to his recommendation, supported later by his sacrificial resignation (there was literally nothing peev- ish or disgruntled about it, as is shown by the fact that at the request of the President he continued as chairman of the Advisory Commission), that the War Industries Board was made independent of the Council and infused with power. It was not for Mr. Willard to have the honor of being in at the "kill" in the War Industries Board's long struggle to dominate the economics of the war, but a study of the records of the Council and the Advisory Commission and the accounts of his associates reveal that in many funda- mental ways he prepared the foundation, even outside his special domain of transportation — which is the supreme "facility" of the utilization of material and materiel — for the later eff'ective functioning of the War Industries Board. Trail-blazers usually experience more hardship than honor. Often their mistakes in an uncharted field are as honorable as the accomplishments of their successors. The superstructure is more obvious than the foundation. Frank A. Scott, chairman of the Munitions Standards Board, chairman of the General Munitions Board, and first chair- man of the War Industries Board, was one of the pioneers in building the American war machine, and he was one of the sacrifices to its grinding labors. His health failed before the machine was complete. He would not have been the best man to direct the finished War Industries part of the machine. He himself, with a singular and somewhat THE PERSONAL ELEMENT 83 moving generosity, has said that probably it was an excellent thing that he broke down to be succeeded eventually by Baruch. However that may be, he was thought to be peculiarly well adapted to the pioneer work that fell to him. A student of military matters from boyhood, he became, as a manufacturer, deeply interested in the industrial impli- cations of war. He knew what such an efficient nation as Germany would logically do in an industrial way to prepare for war. On three different trips to Europe before 1914, he carefully studied the production of military materiel in England, Russia, Germany, France, and, in a minor way, in Italy. As early as 1909 he came to the conclusion that Germany was preparing for a war of conquest, and that she would so overtop her immediate enemies, owing to her industrial preparedness, that the United States would be forced to join the league against her in order to prevent Germany from becoming the world's dictator. The extraordinary development of by-product coke ovens in Germany, and even in England by German capital, indicated that Germany was planning far ahead for a great supply of the ingredients of high explosives. Scott found like signs in the development of the dye industry and the building of plants for the fixation of nitrate. The dis- covery in the winter of 1914 that Germany had placed orders for a certain type of turret lathe, used in the pro- duction of fuses, on such a scale that it would have absorbed the entire annual capacity of the United States, absolutely confirmed in his mind the opinion arrived at in 1913 that the war would begin in 1914 — an opinion that was even then so near a judgment that Mr. Scott caused his own company's turret lathe plant to be made ready for the orders that he was sure would soon be coming from Germany's enemies. When the war came, he shipped lathes to England without waiting for orders. He became one of the Ohio committee members of the Industrial Preparedness Committee of the Naval Consulting Board, and was, therefore, in the midst of an enterprise that dovetailed into the munitions pro- gramme of the Council of National Defense when the United States entered the war. He undertook the duties of chair- I» i I II •i 84 INDUSTRIAL AMERICA IN THE WORLD WAR man of the Munitions Standard Board and of the General Munitions Board with the greatest zeal and performed them with boundless energy, finally paying the price of collapse, and becoming one of the many and little honored civilian casualties of the war. A man with such an experience and such a foresight was presumably specially qualified to cooperate with the army and navy in planning and stimulating the production of munitions in this country. He may have put munitions proper out of perspective with the general industrial back- ground, but it required a tremendous emphasis on the source of requirements to bring out the basic effects. These soon emerged and then the General Munitions Board was merged in the greater War Industries Board. Mr. Scott was throughout a firm believer in the creation of a civilian organization that would complement the army supply system instead of superseding it. It is probable that it was due to him that the Executive decision did not swing to a depart- ment of munitions in the first two or three months of the war. He had a high opinion of the capacity of the regular army officers, and his consequent friendly relations with tfiem did much to cause them to welcome in an increasing degree the assistance of the War Industries Board. The eventual evolution of the Board conformed to his original conception of a civilian organization that would be a coordinating body standing between the army and navy and other war instrumentalities and industry, but went farther, because in its field it became commanding. With all his understanding, Scott did not achieve complete success in the War Industries Board and could not have succeeded, because he was too respectful of the army. A uniform to him was the equivalent of a certificate of superiority in military matters. He clearly perceived the dire need of the army for civilian assistance, but he did not fully grasp the need of civilian domination in supply matters. Baruch is open to the criticism that, perceiving this need, he did not force the issue in those dreary months when the Board was drifting and dying of anaemia; and Secretary Baker was letting the army run wild through the supply pastures and was planning, with the aid of Mr. ALEXANDER LEGGE Vice-chairman of the War Industries Board. Manager of the Allied Purchasing Commission and Baruch's Chief of Staff. Now President of the International Harviter Company INTENTIONAL SECOND EXPOSURE 1/ I IJ I 84 INDUSTRIAL AMERICA IN THE WORLD WAR man of the Munitions Standard Board and of the General Munitions Board with the greatest zeal and performed them with boundless energy, finally paying the price of collapse, and becommg one of the many and little honored civilian casualties of the war. A man with such an experience and such a foresight was presumably specially qualified to cooperate with the army and navy in planning and stimulating the production of munitions in this country. He may have put munitions proper out of perspective with the general industrial back- ground, but it required a tremendous emphasis on the source of requirements to bring out the basic effects. These soon emerged and then the General Munitions Board was merged m the greater War Industries Board. Mr. Scott was throughout a firm believer in the creation of a civilian organization that would complement the army supply system instead of superseding it. It is probable that it was due to him that the Executive decision did not swing to a depart- ment of munitions in the first two or three months of the war. He had a high opinion of the capacity of the regular army officers, and his consequent friendly relations with them did much to cause them to welcome in an increasing degree the assistance of the War Industries Board. The eventual evolution of the Board conformed to his original conception of a civilian organization that would be a coordinating body standing between the army and navy and other war instrumentalities and industry, but went farther, because in its field it became commanding. With all his understanding, Scott did not achieve complete success m the War Industries Board and could not have succeeded, because he was too respectful of the army. A uniform to him was the equivalent of a certificate of superiority in military matters. He clearly perceived the dire need of the army for civilian assistance, but he did not fully grasp the need of civilian domination in supply matters. Baruch is open to the criticism that, perceiving this need, he did not force the issue in those dreary months when the Board was drifting and dying of aiicemia; and Secretary Baker was letting the army run wild through the supply pastures and was planning, with the aid of Mr. * I ^ \ ;• ALEXANDER LEGGE ana iiaruch s Chief of Staff. Now President of the International Harvester Company _ ■III, II r THE PERSONAL ELEMENT 85 I II KH 11 'I Stettinius, to create the needed agency through a munitions department within the army, that would have left the War Industries Board a shell. The discovery of Alexander Legge, and his conscription for the Allied Purchasing Commission and the War Industries Board, constitute a striking example of the chairman's policy of searching out the little known big men of industry. Even in this age of advertising and publicity, it frequently happens that the key men in many great corporations are not known to the world. It is too true that about the time a great execu- tive becomes known to the world, his best days are past. Reputation trails performance. The War Industries Board had to be vital and laborious throughout in order to meet the pressing emergency. It could not afford the lost motion of great names and vicarious deeds. Its executives must be men still in the winning periods of their lives; men who ' were still business workers rather than business authorities. On a list of twelve names that Mr. Baruch made up from answers he got to inquiries for "coming men," who would be good material for the general management of the Allied Purchasing Commission, appeared the name of Legge. Baruch had never heard of him. When the list was shown to one of the chairman's associates, he pointed to Legge's name and said: "There is your man, but you can't get him. He knows Europe, he knows human nature, he is a very shrewd trader, he is as straight as a die, and an unbeatable fighter. His is the best head in the International Harvester Company. He is a rare combination of talent for leadership and gentleness." Cyrus McCormick, then president of the International Harvester Company, which Legge now heads, did not see how he could spare Legge in such troublous times for business. The harder McCormick clung to Legge, the more Baruch wanted him. But in those days there was no resisting the appeal of the country's need. So Legge came to Washing- ton — from the troubles of a great corporation to those of the world. His remarkable success in the larger field was partly due to his wide experience in international business, but more to his profundity of perception and comprehen- siveness of analysis. He could tell unerringly and almost It t i 86 INDUSTRIAL AMERICA IN THE WORLD WAR immediately two things about every man he dealt with, namely, whether he knew what he was talking about and whether he was sincere — that is, believed in his own propo- sition or contention. He thus saved an immense amount of time that men less keen in analysis must inevitably lose. The members of the various commissions representing the Allies soon appreciated that it was useless to try to wheedle out of Legge something that was not essential. But when they had a real need Legge knew it, and they could always count on him to help. Their confidence in his ability to meet their requirements eventually became so sublime as to be almost pathetic — for those were days when all men met at least occasional defeat at the hands of circumstances. Legge was as good at analyzing problems as at sizing up men. His mind went unerringly to the key to every situation. Not only could he see a problem in its simplest terms, but he had the faculty of stating his views in die clearest and most convincing way. When he spoke, debate ended, for somehow it almost always appeared to all that he was right. Besides, it was soon known to all with whom he dealt that his decisions were ultimate, unless the circumstances under which they were made were fundamentally altered. Then, too, with him finality was never asperity. A decision clothed in inevitability and gently stated wins willing acquiescence. Such were Legge's decisions — and always Impersonal. They were never felt or seen as personal triumphs in a contest of wits and words; they were oracles of the predestined. Talents are cast in many moulds. Legge had his kind, but he knew that there were others. Asked to recommend the right man for the Board's production department — known as that of finished products — ^Legge unhesitatingly named his chief personal rival in private life, George N. Peek, of Deere & Company, Moline, Illinois, and of a per- sonality that was the very antithesis of Legge's. The calm, cool, deliberate man recommended Peek, impetuous, impa- tient, impulsive, explosive. The easy-going type of executive recommended the restless, driving type. Peek was perhaps not such an analyst as Legge, but he was a photographic observer. His mind comprehended every element of a situ- ation and his reactions were instantaneous. It never idled; I THE PERSONAL ELEMENT 87 it never saw dimly. For Peek the world was a sharp black- and-white drawing. His decisions were as clear-cut as were Legge's, but they somewhat offended; and all the more be- cause they were right. Those who were overborne by them felt the pangs of defeat. But note that the consequences were not harmful. You resented the sting of Peek's com- manding dictum, but at the same time you were impelled to go right out and put your shoulder into the collar — "just to show him." He put you on your mettle. Peek is the type of executive that has an immense capacity for detail without getting lost in it. He sees the trees, but does not overlook the forest. His energy is infectious. Some energetic men tire out their associates, but Peek seemed to radiate energy in the War Industries Board. Legge made you feel that tangled matters would come out all right; Peek made you feel that he would untangle them himself in a jiffy. Clear-eyed and dynamic — George Peek is the type of the best in American business life. J. Leonard Replogle had a hard place to fill. A young man of high renown in the world of iron and steel, he was called upon to take a position that necessarily brought him into opposition with the chief men and interests of his calling. In serving the Government he stood to block his own career. In such a position a man might err on either side; he might drive too hard bargains for the Government or he might be too considerate of the industry. From beginning to end, Replogle made the public interest first, but he was fair to business. When he entered the Government service he had only one minor interest that could be directly affected by his position as director of steel; that interest lost money through- out the war. As the conserver as well as the producer of steel, Replogle gave a rare exhibition of courage when he resolutely directed the whole steel output of the country to direct or indirect war purposes. Often he had to defend his policy against the great steel corporations as well as against the great users of steel. His complete knowledge of every angle of the business qualified him for this important posi- tion. Specious arguments and manipulated cost-sheets meant nothing to him. His position duly taken and fortified with the facts, he stood like a rock against both assaults and impor- 88 INDUSTRIAL AMERICA IN THE WORLD WAR I) If tunities. He forced down prices and increased production; things that the steel men said could not go together. Judge Parker had a maddening job, but always kept his temper. An able lawyer, yet his genius leaned to concilia- tion rather than strife. As the absolute lord of priority, his task made his days a continual round of meetings with angry and outraged men. It was as hard for the individual manu- facturer to see the whole scheme of things in the war as for the individual doughboy. Both were inclined to think through- out the war that they existed to be discriminated against. It was for Judge Parker to show the suffering individual how his trouble became the general good. Almost invariably he succeeded. With all of a lawyer's respect for law and statu- tory authority, he was in an office where he had to use a vast authority that could quote no statutes. He had to derive his authority from those to whom he applied it — and he suc- ceeded admirably. He impressed all with his sincerity and lofty purpose and won them by his unfailing courtesy and good-temper. Mr. Brookings was the only executive of the War Indus- tries Board who was well along in years; but measured by endurance and energy he was the equal of the youngest. A retired business man who had always cultivated a devotion to the service of the general welfare, he naturally grasped the conception early in the war that it meant the complete sub- jection of the individual to the general interest. From the first, he was a firm believer in price-fixing as indispensable to the satisfactory conduct of the war. A protege of Secre- tary Houston, there is little doubt that his insistence on the importance of controlling prices had its effect in the White House. An associate says of him that his fundamental hon- esty is one of his strongest characteristics. "He is so honest," savs this associate, "that he is honest with himself." United to this honesty, which was so obvious that it invited equal honesty, was an exceptional ability to grasp the essentials of the most complex contract or other business relation. Add courage to honesty and ability and you have the qualities that made Brookings the right man in the right place. Leland L. Summers, who was the technical adviser of the War Industries Board and head of the Chemical Division, M. K f"!!" ''w''^ ""/ '^^^'^ '• LEONARD REPLOGLE EDWIN B. PARKER Member of the War Industries Board and Priorities Commissioner INTENTIONAL SECOND EXPOSURE f Ij I I 88 INDUSTRIAL AMERICA IN THE WORLD WAR tunities. He forced down prices and increased production; things that the steel men said could not go together. Judge Parker had a maddening job, but always kept his temper. An able lawyer, yet his genius leaned to concilia- tion rather than strife. As the absolute lord of priority, his task made his days a continual round of meetings with angry and outraged men. It was as hard for the individual manu- facturer to see the whole scheme of things in the war as for the individual doughboy. Both were inclined to think through- out the war that they existed to be discriminated against. It was for Judge Parker to show the suffering individual how his trouble became the general good. Almost invariably he succeeded. With all of a lawyer's respect for law and statu- tory authority, he was in an office where he had to use a vast authority that could quote no statutes. He had to derive his authority from those to whom he applied it — and he suc- ceeded admirably. He impressed all with his sincerity and lofty purpose and won them by his unfailing courtesy and good-temper. Mr. Brookings was the only executive of the War Indus- tries Board who was well along in years; but measured by endurance and energy he was the equal of the youngest. A retired business man who had always cultivated a devotion to the service of the general welfare, he naturally grasped the conception early in the war that it meant the complete sub- jection of the individual to the general interest. From the first, he was a firm believer in price-fixing as indispensable to the satisfactory conduct of the war. A protege of Secre- tary Houston, there is little doubt that his insistence on the importance of controlling prices had its effect in the White House. An associate says of him that his fundamental hon- esty is one of his strongest characteristics. "He is so honest," says this associate, "that he is honest with himself." United to this honesty, which was so obvious that it invited equal honesty, was an exceptional ability to grasp the essentials of the most complex contract or other business relation. Add courage to honesty and ability and you have the qualities that made Brookings the right man in the right place. Leland L. Summers, who was the technical adviser of the War Industries Board and head of the Chemical Division, I ' \ '4 I h •> ■f 1 GEORGE N. PEEK Member of the War Industries Board and its Commissioner of Finished Products EDWIN B. J. LEONARD REPLOGLE Member of the War Industries Board and Director of Steel Supply PARKER Member of the War Industries Board and Priorities Commissioner 11 : r f 1 I'i I I , THE PERSONAL ELEMENT 89 had a profounder insight into the industrial bases of modem armament than any other man associated with the beginnings of the War Industries Board. He was the first technician called into conference by Mr. Baruch — in November, 1916; and it was the exposition of the primary sources of weapons and explosives that he then made that gave Baruch his initial understanding of how modern war is rooted in industry — even in forms of industry that are in the highest degree peaceful. It was from Summers that Baruch learned how correct was his own judgment that there was no successful dealing with the problem that did not begin with raw mate- rials. As the engineer unfolded one line after another of sequences leading back to raw materials, Baruch was stunned by the immensity of the task that would confront the United States in the event of war. He could see no possible way of coping with it except through the virtual incorporation of all industry into the Government, and from that moment the idea of securing the cordial, voluntary cooperation of industry was the idea that informed all of Baruch's plans for utiliza- tion of the resources and facilities of the Nation. Baruch never had greater luck than when he found Sum- mers. Digging into the nitrogen-fixation and coal-tar indus- tries of Europe for years. Summers had struck his pick on the roots of the war as far back as 1911. He uncovered them in the fertilizer and synthetic chemistry industries and found them in the hearts of the German people. Away back then he saw that Germany was amassing materials and strength- ening her industries for something grimmer than commercial war in dyes and fertilizer. Long before August, 1914, Summers knew what a terrible part high explosives would play in the war that as early as 1911 he had warned his clients was coming. More than any other man in America he knew the relations of industrial synthetic chemistry to warfare. Moreover, for the first three years of the war he was identified with the material reinforcement of the Allies in America and from their procurement officers had learned all that was known to them, as the war progressed, of guns and explosives. He had been in daily touch for three years with the manufac- turers who were striving to meet the Allies' requirements for 'f ,1 90 INDUSTRIAL AMERICA IN THE WORLD WAR munitions. He knew what had been learned by Americans in that period and he personally knew the men who knew. Summers had watched artillery development for years; saw the Bulgarians hammer the Turks to shreds with their French guns against the Krupps of the Turks, and knew that the Germans were planning an extensive artillery recrudes- cence. All the lore of the chemistry ballistics and dynamics of war was at his finger-tips and he saw deeply into the remote economic and industrial implications. Called into consultation with British artillery officers in 1915, General Pease, sometime commandant of the Woolwich Arsenal, casually asked Summers what artillery regiment he had served with when in the army. All through our participation in the war. Summers was in touch with every phase of artillery development, keeping a particular eye on the incomparable French artillerists. He was as enthusiastic as a boy with his first gun when the French sprang a "75" coup in 1918 that appears never to have been made public. They had found that merely by altering the shape of the shell, without changing the gun, the range could be increased from eight thousand to eleven thousand yards. While most of their plants went on with the former type of shell, they concentrated a number of their best plants on the new type and secretly transported immense numbers of them to the front. On a fixed date the 75's all along the French front opened up with the new ammunition and the Germans found supposedly safe positions well within the range of the redoubtable 75's. Summers was the War Industries Board's alchemist of the wizardry of war. In him Baruch found a man who knew it all or knew where to get what he did not know. As the former glimpsed from the latter the dependence of modern war on applied chemistry and visioned victory in materials, as the two strolled in the woods on Baruch's South Carolina estate, talking of the struggle that was over there and was coming to America, Baruch offered the chemical engineer, out of his own pocket, the same salary he was then receiving to come with him into the Advisory Commission. 'How much do you get?" asked Summers. 'Nothing — and pay my own expenses." THE PERSONAL ELEMENT 91 (41 641 "I'll go with you on the same terms," decided Summers. And he was not a rich man. Summers and other men who, like him, had been in the war for three years, constituted a group of experts of whom the War Department was ignorant. On this group the Raw Materials Division of the Advisory Commission drew freely and with unerring judgment. It was Summers who first laid stress on the need of an adequate supply of nitrates, platinum, aluminum, toluol, and many other things. At that time the Ordnance Department was not even interested in toluol and could not be interested, but Summers, Baruch backing him up, later arranged, with- out any authority whatever, and independently of the army and navy, to have the Du Ponts begin at once to assemble a supply of toluol, as the Allies then had control of virtually the entire production of that chemical in the United States. Yet toluol meant T.N.T., the greatest of high explosives, with which the Germans well-nigh battered their way to victory before the Allies could reply in kind. Thanks to Summers, when the army found out that it would require immense quantities of T.N.T., the toluol was available. There was so little understanding of the material corollaries of war by the army as late as December, 1916, that Summers informed Baruch that it was a waste of time even to propose prepara- tory technical measures until our own entrance into the war should be imminent. In March, 1917, Baruch declared the time had come, and Summers then took up the work which he did not relinquish until after the war was over. Hugh Frayne, the labor member of the War Industries Board, carried into that body the important factor of labor representation which had been an outstanding feature of the Council of National Defense, of the Advisory Commission of which Samuel Gompers, president of the American Fed- eration of Labor, was an efficient and tireless member. In passing, it should be said that, while Mr. Gompers was always on guard to see that the war enterprise did not become a means of oppressing labor, he was second to none in the breadth of his patriotic devotion and thought. He was never a class-champion obstructionist in the councils of the Advi- sory Commission. He was a strong believer in the scheme 1 I il k 92 INDUSTRIAL AMERICA IN THE WORLD WAR of close cooperation with industry and was one of the first to endorse the programme of industrial group committees to facilitate Government dealings with private business. Some- what inclined to consider favorably the exception of skilled labor from military service, he was an early and whole- souled convert to the principle of selective service. It will do no harm at this late date to say that, when the question of recommending to the President the principle of universal service came before the Advisory Commission, Mr. Gompers frankly told his associates that, while he personally favored it, he considered that it would be inexpedient for him to vote for it. The result was that no vote was taken, but the Sec- retary of War was authorized to interpret the Commission's views to the President. With Mr. Gompers on the Advisory Commission and Mr. Frayne on the War Industries Board, there were no dealings with "big business" or any other kind of business in which labor was not consulted and represented. Labor was thus on the inside of the Government's economic policy, and the business of war was not conducted with an eye single to inanimate things and to the neglect of the human element. Frayne knew labor's point of view and how to manage it. He understood the human factor in production. In conse- quence the War Industries Board took no measures in which the labor factor was overlooked. If prices were fixed at levels which yielded profits that would stimulate production, it was always provided that labor should have a share. It is true that the War Labor Administration was placed in the Department of Labor and not in the War Industries Board, but Frayne played an indispensable part, for he was on the spot, at the beginning of things, shaping economic policies so that labor problems as to supply and remuneration might be so founded that there would be a minimum later need of governmental adjustment. Thanks to his work the cor- rective functions of the War Labor Administration were not generally required. Like Gompers, Frayne was for labor, but in the war he was for the country first and for groups second. He was a conciliator and moderator rather than a protagonist. At the same time Frayne was no colorless labor mugwump. LELAND L. SUMMERS Technical Advisor to the War Industries Board and Chairman of the Foreign Mission INTENTIONAL SECOND EXPOSURE i \] ? 92 INDUSTRIAL AMERICA IN THE WORLD WAR of close cooperation with industry and was one of the first to endorse the programme of industrial group committees to facilitate Government dealings with private business. Some- what inclined to consider favorably the exception of skilled labor from military service, he was an early and whole- souled convert to the principle of selective service. It will do no harm at this late date to say that, when the question of recommending to the President the principle of universal service came before the Advisory Commission, Mr. Gompers frankly told his associates that, while he personally favored it, he considered that it would be inexpedient for him to vote for it. The result was that no vote was taken, but the Sec- retary of War was authorized to interpret the Commission's views to the President. With Mr. Gompers on the Advisory Commission and Mr. Frayne on the War Industries Board, there were no dealings with "big business" or any other kind of business in which labor was not consulted and represented. Labor was thus on the inside of the Government's economic policy, and the business of war was not conducted with an eye single to inanimate things and to the neglect of the human element. Frayne knew labor's point of view and how to manage it. He understood the human factor in production. In conse- quence the War Industries Board took no measures in which the labor factor was overlooked. If prices were fixed at levels which yielded profits that would stimulate production, it was always provided that labor should have a share. It is true that the War Labor Administration was placed in the Department of Labor and not in the War Industries Board, but Frayne played an indispensable part, for he was on the spot, at the beginning of things, shaping economic policies so that labor problems as to supply and remuneration might be so founded that there would be a minimum later need of governmental adjustment. Thanks to his work the cor- rective functions of the War Labor Administration were not generally required. Like Gompers, Frayne was for labor, but in the war he was for the country first and for groups second. He was a conciliator and moderator rather than a protagonist. At the same time Frayne was no colorless labor mugwump. H f I i il u LELAND L. SUMMERS Technical Advisor to the War Industries Board and Chairman of the Foreign Mission II' i (I 1! THE PERSONAL ELEMENT 93 He was of the heart of organized labor, and was in a sense elected to, rather than selected for, his position. As the representative of the navy on the War Industries Board, Admiral Fletcher was most successful. He is a man of few words, a good listener and a good "understander.'* His great value to the War Industries Board was that he was able to rise above his profession and take the broader view. He did not conceive that his duty was to be the protagonist of the navy, but rather to make it a part of an harmonious whole. Through him it was often possible to secure the cooperation of the navy in the general scheme against the opposition of officers who felt that the navy was always com- petent to pass judgment on all that concerned it without out- side suggestion or assistance. General Hugh S. Johnson was the active representative of the War Department on the War Industries Board, though General Goethals held the title. He was in full sympathy with the purposes of the Board and considered it indispen- sable. His mind is as clear as a crystal and as orderly as an alphabetical file. It is logic energized. Before its faculty of analysis, the most chaotic disorderliness dissolved into order. His inevitable logic not only clarified the business of the War Department with industry, and cleanly articulated the procurement agencies of the army to the War Industries Board, but even interpreted the latter to itself. It was John- son, by the way, who, while attached to General Crowder, took it upon himself to have the draft regulations printed and in hand before the War Congress authorized the action or the expenditure. That expresses Johnson. THE SOURCE OF POWER 95 n II I 1 CHAPTER V THE SOURCE OF POWER From the acorn the oak — Administration by request — The right to com- mandeer — » Cooperation the supreme power — Discipline through public opinion — Baruch and Wilson — Baruch in the saddle — Tying-in the executive agencies for a common will to war. The records of Congress will be searched in vain for the organic act of the War Industries Board. There is none. The most powerful executive agency for correlating civil and military life in the greatest of wars has no legislative incep- tion. It grew from small beginnings, and, just as its func- tional branches penetrated and entwined the whole structure of administration affected by war, its roots and radicles of power tapped virtually every permanent or emergency execu- tive power and the unwritten will of the people. Its authority, being without the implied limitations of legislative definition, was, under the stress of necessity, an ever-growing thing which it was diflScult to resist. While none could point to any precise definition of its powers by act of Congress, it was equally true that nobody could confidently assert that it was without authority to do what it undertook to do. But because the War Industries Board could not point to any specific act of Congress, it must not be supposed that it was an extra-legal body or that in its mature form it did not have ample authority. On the other hand, because it began with no executive authority and had to proceed by permission in its early days, it built up a certain authority that was based on the "consent of the governed," and, in general, until the end of its days, acted on the assumption that what it did was willed by those aflfected. Its government was by request rather than by mandate. It is true that few chose to resist those requests, but compliance was based as much upon the com- pulsion of reasonableness and the pressure of opinion as upon fear of governmental power. The powers of the War Industries Board, which, by a system of interlocking functions that attached to themselves the powers of all executive instrumentalities, eventually be- came coincident with Government itself, can be traced to three general sources: I. Certain acts of Congress relating to preparedness for or the conducting of the war. II. Ordinary Executive authority and the extraordinary powers entrusted by Congress to the Presidency for the war emergency. III. The formulated and implied war powers of the Executive. IV. The consent and cooperation of industry and of the public. The first included the act creating the Council of National Defense (the Military Appropriations Act of 1916) and the National Defense Act of the same year. The former act, while it related only to advisory right, nevertheless con- tained ample authority for the original creation of such a body as the War Industries Board, as the act gave the Council authority to "organize subordinate bodies for its assistance in special investigations." Section 120 of the National Defense Act also gave the President discretionary authority to appoint "a board on mobilization of industries essential for military preparedness, non-partisan in character." As mentioned elsewhere, this section, so far as the writer knows, was not specifically referred to by the Council, the Board, or the President at any time, and it is to be noted that no power of executive action was conferred on this possible body. As a part of the Council of National Defense organi- zation the War Industries Board could legally perform any of the functions assigned to it by the latter. In an advisory way these covered an extensive field, as an examination of the act, elsewhere printed in this volume, will show. It is true that the Council was to make recommendations only to the President and heads of Executive departments, but by general consent in practice, after the war began, the Advisory Commission and its creatures communicated directly with subordinate officials of the Executive departments, so that they had a certain degree of influence on the active functionaries. The acceptance of such advice by the Executive depart- ^-v -> * ^, > n s >> £ 5? « u . O OB ^« ^§ Q, 0) a; O 88 ^ 5 «* ■ >. ** t: «~ ^ o 2 *-^ •S" O 03 o * c^ £ g i o hi OS hi %^ INTENTIONAL SECOND EXPOSURE I If i !i « 1 128 INDUSTRIAL AMERICA IN THE WORLD WAR ally about all the war agencies, great and small, that had need of real information or cooperative assistance had their representatives at the meetings of the Requirements Division. The advantage that this division, but little known to the public, had over the more impressive War Cabinet and War Council was in the composition of its personnel. They were neither the Cabinet members nor the heads of the great emergency agencies, prone to abstract discussions and har- monious agreements in principle who were so lost in a welter of pressing duties; they were the working executives — the men to whom action was second nature. An undertaking expressed by such a man in the presence of a group of his fellows who would keenly hold him to account meant con- crete results. These officers, like their civilian confreres in the War Industries Board, were doers, not dignitaries. The weakness of the Requirements Division was that, after all, it was not supreme over all requirements. It passed on requirements as they came within the scope of the War Indus- tries Board. It did not draft them. It sought to modify them, but in the last analysis it did not have the right to say that from the general viewpoint they were fundamentally wrong. It was not at the apex because it was part of an organization that was originally subjective, and that established functions to deal with its own field. These functional implements were the great war-control instrumentalities, but it was sought to use them within one agency to direct others. Necessarily, even with the best of spirit and with the use of interlocking devices, they did not have the supremacy that would have flowed from complete detachment. Food, fuel, the Shipping Board, the Railroad Administration, etc., were agencies co- equal in rank with the War Industries Board, each with cer- tain subjects to deal with. It was not logical to seek to direct them from within the War Industries Board. They were responsible to the President, and in the sense of authority they could be reached only through him. It was a cumber- some arrangement, but it worked because it was an organic growth rather than a made-to-order machine. The army was always the requirements riddle of the War Industries Board. Not only was it the chief consumer and the great originator of requirements whose nature and volume \ . O ? ~ '«-' ■^ < a St a t>3 ^ CQ cc S iV- IM'.. !li I I I \\ REQUIREMENTS AND RESOURCES 129 were violently variant, but its administrative organization was archaic and bureaucratically decentralized. As has been said heretofore, the War Department did not know its require- ments even at the end of the war. That was partly inherent in the circumstances of the war, but even so there never came a time when any one office in the War Department was the pool into which led all estimates of requirements. Conse- quently, the War Department was ij/ever able to give the War Industries Board even a compreh^sive estimate that was worthy of the name. From the beginning of the war until the last shot was fired, the War Department was struggling with internal reorganization intended to cure its business defects. Before the reinvigoration of the War Industries Board in March, 1918, the War Department seems to have had a sort of dual programme of traveling along with that body and, at the same time, of solving its business problems in an internal manner; that is to say, of building up its own system of contact with industry. This cannot be positively affirmed as being an intention; perhaps it was rather a tend- ency promoted by the long period of lethargy in the War Industries Board. At any rate, the War Department was very backward in developing the War Industries Board. However, most of the officers who represented the War Department in the War Industries Board in various capacities were believers in the vigorous development of the Board. The contacts they there made with each other, with repre- sentatives of other departments, and with the competent civilians of the Board convinced them that all the Board needed to help them solve their most pressing problems was a much larger scope of authority than it had at first. Through them the War Industries Board was influential in promoting the reorganization and tightening up the supply agencies of the army. They found that the Board, adapting its organi- zation to the natural classifications of industry, communicated with industry through commodity sections, and they pro- ceeded to devise an informal, cooperative grouping of the officers engaged with supply matters into like groups. Partly by voluntary consent and partly by pressure all the officers of the diflFerent bureaus and corps concerned in the buying of the same commodity came together and pooled I 1 1 ' I 130 INDUSTRIAL AMERICA IN THE WORLD WAR their immediate demands and their requirements so far as they knew them. Then a single oflBcer was delegated to act for the army in respect of this commodity in dealing with the War Industries Board. This process was facilitated by the fact that the different buying agencies had been forced to adapt themselves to industry by classifying their needs according to commodities, which was a lesson largely learned from association with the War Industries Board. Aside from this rather informal readjustment of purchas- ing, the War Department itself was endeavoring to effect such restriction of the bureaus and such aggrandizement of the General Staff functions as rather rigid statutory limita- tions would permit. By way of diversion from the immedi- ate subject, it is worth while to remark that if Congress had let Elihu Root have his way when he was Secretary of War, the General StaflF would have been endowed with ample authority over the hard and knotty bureaus. But Congress was so afraid of militarism that it insisted on the retention of the bureaus with the deliberate purpose of making the War Department many-headed and centrally weak. It suc- ceeded so well that it almost lost the World War. After- wards it spent several millions of dollars through a partisan House Select Committee on Expenditures in the War Depart- ment in endeavoring to prove that the war enterprise was a failure in every respect except in the minor item of winning the war. As yet Congress has appointed no committee to investigate its own responsibilities for the mistakes and blunders of the conduct of the war. On January 18, 1918, General Palmer E. Pierce, who had been representing the army on the War Industries Board, was made Director of Purchase, and thereafter every commodity which was handled by more than one bureau had to be cleared through the Director of Purchase. About the same time the Quartermaster Corps was reorganized on a com- modity basis into the following procurement divisions: Clothing and Equipage, Fuel and Forage, Hardware and Metals, Remounts, Subsistence, Vehicles and Harness, and Motors (later the Motor Transport Corps). This centralization of buying was not, however, authori- tatively eflfected and eflScient until after the passage of the REQUIREMENTS AND RESOURCES 131 Overman Act, which gave the President power to switch Government bureaus and functions around as he pleased. The General Staff Division of Purchase, Storage, and Traffic was then created, and the reform instituted by General Pierce carried on to a centralization of purchase, storage, distribu- tion, and finance in that division under Major-General George W. Goethals. Thus the Quartermaster Corps faded away to a minor operating agency in the field. These major administrative reorganizations of the army were going on simultaneously with the reorganization of the War Industries Board in anticipation of or under the Overman Act, at which time, of course, the War Department had abandoned any plan it may have had of working out its own supply salva- tion independently of the War Industries Board. General Hugh S. Johnson, who succeeded General Pierce when the latter went to France, although formerly sharing the prevailing army view of the War Industries Board as an agency of more or less obnoxious civilian interference in military matters, soon became a zealous convert to its prin- ciple and exerted himself energetically, both as army repre- sentative on the Board and within the War Department, to bring about a full functioning of the Board in relation to the army. At this time General Goethals, who had been recalled from retirement to become head of the Division of Purchase, Storage, and Trafiic, was the member of the War Industries Board representing the army, but General Johnson was charged with the performance of the duties of the repre- sentation. To a profound belief in the functions of the War Industries Board he brought the assistance of a mind of exceptional clarity -and logical grasp. Colonel Charles A. McKenney, who was first associated with the work of the War Industries Board as representative of the Engineer Corps of the army on the General Munitions Board, became the army priorities representative, after the reorganization of the Board in the spring of 1918. He, also, was a devoted believer in the War Industries Board, and was greatly influential in interlocking the supply departments of the army with the Board. He was so completely supported by the Secretary of War that he was able to overcome the stubborn objection of army officers to accepting any sort of fi, ±i I 11 , I 132 INDUSTRIAL AMERICA IN THE WORLD WAR instructions coming from an inferior in rank. A brigadier- general, for example, would be loath to accept priority directions from a colonel, failing to see that in such a matter the colonel was endowed with a special authority that tran- scended military seniority. It is possibly true that General Peyton C. March, who as Chief of Staff" has been well and deservedly described as the dynamo of the stupendous military eff'ort America put forth in 1918, was never in deep sympathy with the work of the War Industries Board. As a professional soldier, reared in the restricted American military tradition of the complete separation of military and civil endeavor, he was inclined to the view that all war-making measures should be primarily under military control. Assuming in the General Staff" as complete an understanding of industry and com- merce as it should have of purely military aff"airs, and assuming also years of preparation as a Great General Staff", such would be the logical relation. Lacking these require- ments, as our General Staff" and army did, the creation of such a universal joint as the War Industries Board between the military establishments and industry was the better way. On one side it was blended with industry; on the other with the military. It understood the languages of both and inter- preted them both ways. The slowness of its growth was well-nigh fatal, but it had the advantages of growth over those of an a priori creation. For that reason it was, on the other hand, a better supplemental agency than a statutorily created ministry of munitions would have been. The failure to approximate and coordinate requirements with respect to each other, and the vital element of time, led to the temporary over-supply of some things and the under- supply of others; to the production of parts of military equipment before their complementary parts; as, for ex- ample, guns and their carriages. The outcome was that in the last months of the war millions of tons of shipping space were used to carry to France materiel that would merely cumber storage space at the very time that Pershing's army was on the verge of ceasing to function for lack of motor and animal transport. It is quite true that the programme for the supply of motor trucks was laid down before the REQUIREMENTS AND RESOURCES 133 torrential rush of divisions to France was foreseen as pos- sible. On the then known capacity of the "neck of the bottle," there was ample time for refinements of standardi- zation and other approximations of perfection; but when the neck widened and soldiers sped through it by the million the transport was not ready to go with them. At this stage, how- ever, a cold-blooded effort at coordination of the eff"ort in man power and in materiel would have been paralyzing. General March concentrated his energies on a stupendous massing of man power in France and left the rest to Provi- dence and the Allies who cried out for infantry and machine guns at any cost. The American response was 2,100,000 soldiers in France when the war ended and machine guns enough complete for an army of 7,000,000. "I am apprehensive that the Americans will miss the 1918 train," said Marshal Foch in February.^ Thanks to March they caught it. With terrific energy March availed himself of every troop transport that could be brought from the far ends of earth, and as fast as they arrived they were loaded with fighting men. i^l 'How will they get to the front?" some one asked the General. "Let them march," was the answer. And the General was right. An American soldier in France, even three hundred miles from the battle line, con- tributed greatly to the cause of victory. He presented, at the very least, an irresistible moral unit. Transport was lack- ing, but subsistence and the soldier's personal equipment seldom if ever failed. However, the cablegram from Pershing that his army would cease to function unless transport was provided caused a diversion of forwarding energy, or, rather, an additional concentration of it on transport equipment. As an illustration of the impossibility of definitely solving the problem of requirements in a uniform manner, it may be said that on January 1st the military programme called for the delivery of 100,000 soldiers in France in the month of July, 1918. The actual number transported in that single *Not a literal quotation. See America's Race to Victory, by Lieutenant- Colonel Requin, page 149. ii 134 INDUSTRIAL AMERICA IN THE WORLD WAR month was 306,000. For the spring of 1919, which was expected to see the culmination of the war, there were to be 4,000,000 American soldiers in France. Much of the materiel for this colossal force was ready before certain materiel that was currently needed, and the anticipatory goods represented a considerable portion of the 5,153,000 tons of army cargo shipped to France during the war. The army transport fleet grew eventually from virtually nothing at the beginning of the war to almost five hundred ships of a total tonnage of 3,800,000 — more than twice the entire deep-sea merchant marine of the United States in 1917. The most optimistic did not consider such an attain- ment within the realm of possibility a year before. This amazing expansion of the neck of the bottle upset all pro- grammes, and in the rush to utilize it at the moment require- ment projections were overlooked. Even the troop reserves to keep the Atlantic conduit filled were overlooked, and General Crowder, supplier of men, was as much in the dark as to requirements as the material supply agencies were as to the subsistence programmes. The writer would have it understood that these matters are set down in no spirit of belittling criticism, but rather as a statement of important fact, for future reference and con- sideration. His remarks herein should always be read with their context. What the army accomplished in supply and transportation, quite aside from the proper military func- tion, would have been remarkable even if it had ]peen mod- emly organized for the task before the war began and had had from the beginning the support of an efficient War Industries Board. To have done what it did whilst in the throes of reorganization and expansion from less than two hundred thousand men to four million entitles it to unquali- fied praise without in any way detracting from the recogni- tion that is due the civilian agencies whose cooperation was indispensable. Nevertheless, the disposition of the problem of current requirements might have been handled with more foresight. Officially the army supply department was not aware that the programme of 100,000 men a month for France jumped to 245,000 actually transported in May. Not until the middle REQUIREMENTS AND RESOURCES 135 of July was the supply department formally notified to take care of 250,000 men monthly. Much less was the War Industries Board authoritatively informed of the new programme. When by chance Mr. Baruch did hear of the Pershing cablegram, there was a tre- mendous scurrying to meet the situation, and a great forward step in civilian power within the army. There was a frank interchange of views between the Chief of Industries and the Chief of Staff which made it plain that the time had come when the army must acknowledge civilian supremacy in the fundamentals of supply. When the war ended, more than thirty-four thousand trucks had reached France, and they were going forward at the rate of ten thousand a month, besides a very large number of other motor vehicles, such as ambulances, passenger cars, motor-cycles, and tractors. Fifty-four thousand horses and mules had arrived in France, and were moving to the front at the rate of twenty thousand a month. It is probably an overstatement of the situation, as made to the author by a general officer who was in France, that the armistice came just in time, on account of the maladjustment of supply transport to personnel, to prevent a "terrible catas- trophe." Had the train of circumstances been different, this maladjustment probably would have resulted in the passivity ' of the American army, with the probable consequence of the postponement of the final scene of the war to die spring of 1919, in accordance with the Foch programme prior to the great Marshal's determination to take advantage of German weakness to impose a decision in 1918. This possible near approach to a disaster should afford a lesson not to be rejected, that in any future war on the mod- ern scale the army must cordially entrust supreme control of supply requirements to a civilian agency, such as the War Industries Board or its equivalent. The complement of the Requirements Division was in a broad sense all the rest of the War Industries Board, func- tional and subjective. The common purpose of them all was to establish a balance between requirements and resources, or between demand and supply. Theoretically the Require- ments Division determined demand and the rest amassed ' 136 INDUSTRIAL AMERICA IN THE WORLD WAR resources. Yet there were certain units of the organization whose special function was to study, develop, and manipulate resources in a broad way. They dealt with internal indus- trial strategy. They sought to work out a territorial diffusion of war industries; to overcome local congestion; to prevent the waste of industrial capacity tending to arise from the restriction of some less essential industries and the complete stoppage of others by the necessities of war; to prevent the American war programme from interfering with the supply programme of the Allies; to husband transportation through the location of war plants contiguous to their materials and to labor; to guard the industrial fabric from unnecessary dissolution; to see that, while the limbs of the industrial body were developed and trained for war, the trunk was not exhausted; and, above all, to increase all essential produc- tion; for war has not only peculiar needs that involve new production, but it enforces more basic production, for what it consumes must of necessity be largely added production of what the nation ordinarily uses. The first agency in this field was the Industrial Inventory Section of the Council of National Defense, which took over the industrial inventory compiled by the Committee on Indus- trial Preparedness of the Naval Consulting Board and which also utilized the Keman Report. This section undertook to expand and revise its initial data, and digest such other data as it could obtain. Then, as the War Industries Board grew to its task, there were created the Resources and Conversion Section, the Facilities Division, the Advisory Committee on Plants and Munitions, and the Division of Statistics and Planning. The commodity sections and divisions were the best sources of information as well as the chief agencies of its application to the general problem of marshaling resources and facilities. Outside of the Board such governmental agencies as the Census Bureau, the Bureau of Mines, the Geological Survey, Ae Bureau of Standards, the Forestry Service, the Statistical Bureau of the Department of Commerce, private commercial reports, and the statistical records of corporations and busi- ness associations of various kinds were drawn on. The Industrial Inventory Section found that much of its raw REQUIREMENTS AND RESOURCES 137 material was not in such form as to give the desired knowl- edge. The Industrial Preparedness Survey showed the capacity of manufacturers to produce certain definite articles. But what was needed was knowledge of the industrial proc- esses used, so that it would be possible to determine a plant's adaptability to the manufacture of an article quite diflferent from its normal output. By May, 1918, the section had reclassified factories according to processes and had added about eight thousand more to the original lists, making a total of approximately twenty-eight thousand. The creation of the Resources and Conversion Section in the spring of 1918 marked the beginning of the systematic, centralized use of the information compiled by the Inventory Section. In the fall of 1918 this work was subdivided by the creation of the Facilities Division. To formulate and digest the statistical information that was collected through so many channels and was subject to use by so many agencies, it was early found advisable to establish a statistical division. This division was found to be invaluable by the General Staff, and it eventually annexed it almost in toto as its own statis- tical division, giving officers' commissions to Dr. Leonard P. Ayres, its chief, and to most of his assistants. It then became necessary for the War Industries Board to replace it with a new organization — somewhat broader — called the Division of Planning and Statistics of the War Industries Board. Its organizer and director was Dean Edwin F. Gay, who was already at the head of a like division in the Ship- ping Board and of the Bureau of Research and Tabulation of Statistics in the War Trade Board. The presentation of the work of these bodies having to do specifically with resources and facilities will be reserved for later chapters. With their enumeration and denomination we complete the picture of the overhead machinery of the great task of balancing resources and requirements. In a large measure requirements were always represented by x, and resources were always capable of some extension. But the War Industries Board eff'ected such a channel between them that Mr. Baruch was able to say in his preliminary report that "not one default was recorded on any demand made by the military establishments." DISCIPLINING A NATION 139 1 P CHAPTER VIII DISCIPLINING A NATION: PRIORITIES IN PRINCIPLE AND IN ACTION The torrential demand for goods — Visualizing a nation's need — The making of an explosive shell — Everybody for himself — What priority is — Priority becomes a center of power — "Essential** versus "non-essential'* industries — Rationing a people and their commerce — The parable of the eggs — "Class AA'* to "Qass D" — Business and the spirit of common service — The army calls for underwear — The national policing of industry — Locomotives, steel, brass, nitrate, acetone, coal, cotton — Which first in the race against time? — Saving the French 75*8 — Pershing wants mules — Priority supreme. Within three months after the United States entered the World War the War Department alone issued, chiefly into a limited industrial district, more than sixty thousand orders for goods and materials. Over this initial flood there poured uintil the end of the war a vast and violent stream of demands for myriad products. Before the raging torrent industry was swamped. Unim- portant goods were made before essentials, freight was produced without cars, and carloads were delivered at the ocean front without ships; all Government orders were "rush," and thousands of army and navy officers and flocks of agents of the Emergency Fleet Corporation and the Food and Fuel Administrations goaded the producers to a fury of disordered efi'ort. Freight piled up at the ocean terminals until freight trains could no longer reach them and had to discharge their burdens in the fields, ten, twenty, thirty miles back; internal railway yards were so chaotically blocked that cars had to be lifted off sidetracks with wrecking cranes to get them on their way again. Even as the deluge grew and the disorder advanced, two- score Government purchasing agencies beat the whirlpool to froth with their bidding and scheming against each other, each obsessed with a mad determination to achieve his own goal. To their able assistance scurried a cloud of specu- lators and jobbers and "shoestringers," inflating demand by the multiplicity of their "middling" efforts. Original orders invariably involved secondary orders for materials and parts and, perhaps, half a dozen inquiries for each sub-order; and the sub-orders were again split and resplit, and each appeared in the most unexpected places. Thus, even the capillaries of industry were congested, and confusion arose in the most remote and unexpected parts of the industrial body. Transportation was turned into a hurdy- gurdy by cross-hauling and, above all, by preference. Every- thing for the Government was preferred until there was no longer a semblance of preference, and the last had a better chance than the first. Manufacturers swallowed orders and yet more until their files were gorged, and still they accepted orders and struggled for more. Serious shortages arose at the same time that the greatest industrial community in the world was headed for asphyxiation in its own product. Such was the malady of the industrial body that the War Industries Board was called upon to heal. The cure was undertaken by administering the hair of the dog that gave the bite. The stampede for preference caused the conges- tion; the enforcement of graded preference, which was the specialized meaning the word "priority" came to have in war industry, eased if it did not terminate the congestion. Modem war not only taxes the resources of a nation for the production of essentially military supplies, of which the consumption is not large in normal times, but at the same time puts a heavy additional strain on the production of many articles of ordinary use. Offhand one might think that five million men taken from civil life and put into the army would merely change the destination of their usual personal supplies. In fact a soldier, if he is always fit in equipment, wears out shoes and clothing, for example, about five times as fast as a civilian. The army purchased in 1918 far more woolen socks than the entire normal annual production of the United States, twice as many blankets, three times as many part-leather gloves; it took all the wool and all the steel. In some lines of commodities forehanded bureaus early cornered all the production for months, if not for years. Add to these abnor- malities the stupendous demands for munitions, of which ;i»i * r ^ 140 INDUSTRIAL AMERICA IN THE WORLD WAR the peace-time production is negligible; reflect that each of these war items subdivides into many industrial sources and manifold processes, and that they all converge on an indus- trial life already disordered by increased demand for ordi- nary goods and the disruption of normal methods by the withdrawal of men and transport, and it is easy to see that the self-control of ordinary times will not serve industry in war. These production strains in ordinary industry had to be met by sixty-six men where formerly a hundred had been occupied, with the help of a few women and children; for twenty-four of each hundred of adult male workers had been diverted to production for military purposes, and ten were in the army and navy; moreover, the war workers and the fighting men were physically, at least, the cream of the hundred. A shell for a gun requires scores of raw materials of the most diverse kind, numerous processes, many finished mate- rials, and a great variety and diversity of human and machine work. The ore-miner in Minnesota, the coal-miner in Penn- sylvania, the coke-maker in West Virginia, the brass-worker in Connecticut, the copper-miner in Arizona, the maker of chemicals in New York, of explosives in Delaware, of milling machinery, of steel, of iron, the transport-worker — all these and many more must synchronously converge their eff'orts or there will be no shell. Let even one of them fail and the shell fails. A hundred thousand things besides shells were required by the Government in the war work — many of them fully as composite and complex. They intermixed and intertwined with each other in materials, labor, facilities, and transport. More of one meant less of another; the maximum of one meant none of many others. Here was the making of the worst tangle of disordered effort the world has known. All of this turbulent torrent of production must be regulated in velocity and volume. This was accomplished through priority which was the synchroniz- ing device whereby each factor did its part at the right time and the measuring device whereby it did its part in the right volume. It was by far the greatest mechanism of industrial DISCIPLINING A NATION 141 control the World War produced. Its like was never seen before and will never be seen again short of the perfect socialistic state. Priority, with experience and study, became the most efii- cacious implement of Government ordinance of industry. It was the sturdy shovel with which the War Industries Board cleared up the blockade and kept the tracks open. It was nothing less than a great system of industrial and transport precedence, automatic in the main, manipulated in the excep- tion, whereby production was ordered, restrained, or stimu- lated to meet current and projected war demands and prevent the civil population from suffering destitution in the midst of prosperity. In effecting these immediate ends it auto- matically checked profiteering and repressed prices. In its ultimate effects, often under other names — such as allocation and curtailment — it impinged not only upon industries, but also upon persons. To some it brought business and prosperity, to others hardship and poverty. None escaped its mandates. The Nation was "prioritized" — and yet there was no collective statute of priorities. Founded on limited legislative enactment, it was without statutory buttresses or punitive supports, and it pursued its way from particular to general and back to particular power by the circuitous route of "request," instead of the straight highway of command. Based on reasonableness and obvious necessity, few questioned its decisions and none dared oppose them. It was cooperative democracy at its highest power, even in an institution which was predicated on the "consent of the governed." In the beginning supply departments poured out orders with as little concern for the consequences as though they were merely dumping letters into mail-boxes. This was due to the decentralization of purchasing authority imposed by statute and to the failure of the army to appreciate that, if in modern war the Nation's industry as a whole is the commissary department of the Nation in arms, it is subject to overstrain and exhaustion just as much as the more par- ticular commissary of the tactical army. The only rule of preference was the good old one of the feeding-trough — first come, first served ; except that as be- t"! It.; h i'i' if i: ■ \ ■ ' II 'i' M ii 142 INDUSTRIAL AMERICA IN THE WORLD WAR tween the army and the navy there was an understanding* between the two Secretaries that the navy was for a time to have the right of way over the army. This understanding — which was more honored in the breach than in the observance — was probably based on the hypothesis that, as the navy was on a near-war footing in time of peace, it should be allowed to complete the comparatively small effort that would effect the transition and thus get into action at an early date ; whereas the army was so remotely distant from readiness that early precedence for the navy would not appreciably affect its exertions. Between this preference of courtesy and what it seized in the ancient way, the navy had about all the preference there was at first. The navy had the advantage of a compact organization, a very clear knowledge of what it wanted and of about where it could get it. Indeed, the navy was so well conditioned that it was inclined to view with distrust the injection of civilian assistance into the situation. Its own good-fortune inclined it to question whether elaborate direc- tion of the production and delivery of supplies was neces- sary; and when it did see the gravity of the situation, it seemed that for the navy to surrender any of its advantages for the prior benefit of others would be merely to dissolve the last solid support in a slithering morass of confusion. Within the army, the Signal Service and more especially the aircraft division thereof appears to have got started ahead of the other bureaus and divisions. In consequence, we hear little of the troubles of the aircraft production task, huge as it was, in the proceedings of the War Industries Board. The Aircraft Board was not lacking in foresight and the volume of its requirements was early established. It placed the bulk of its orders with the automobile industry, which was particularly qualified to meet them with a minimum of inter- ference with other supply processes, and its spruce problem was so vast and technical that it was allowed to handle the whole matter independently of the War Industries Board, except, of course, as the Board used its powers to assist the aircraft managers in putting through Uieir projects. No DISCIPLINING A NATION 143 i««/ As between the army and the navy, priority should be given to such needs of the navy as are intended to be completed within one year.** (Minutes of the Council of ^ational Defense, April 28, 1917.) analysis or appraisal is here made, however, of the American aircraft programme. That, indeed, is another story. The Shipping Board did not get under way with its contract ships — as distinguished from requisitioned — as soon as the aircraft people, and its requirements projected a torrent of orders into the already choked stream of demand. We have seen how clearance, a form of priority at the source, was introduced to check and systematize the flow of orders, and we have observed in a general way the efforts to balance requirements as against compilations of resources — of which we shall see more further on; but neither clear- ance nor the effort to effect an equilibrium in the mass between requirements and resources solved the problem of precedence of production, though they were important con- tributory factors. The final and effective step was the calling in of the prin- ciple of priority, which like so much else of the war imple- mentry was not so much an invention as a product. War industry had not been going very long before manufacturers became bewildered by the clouds of Government orders for which expedition was demanded. Among many first, which should be first? They turned to Washington for direction, but who was to decide among a score of buyers, each of whom could see the issue of the war pivoting on preference for his particular supplies? The demand for a programme or at least schedules of preference in production was the natural complement of the simultaneously perceived need of method in the placing of orders. Indeed, to clear orders is merely to institute priority at the beginning. However, the two phases of one task came up as presentations from opposite directions, and both were referred to the Council of National Defense which through the General Munitions Board established a clearance com- mittee, as we have already seen, and at about the same time — May 3, 1917 — set up a priorities committee. At that time the priority function, as defined by W. S. Gifford, then director of the Council, was that of determining "priority of delivery of materials and finished products, whenever there is a conflict in delivery, in accordance with the general policy of the Government." "It is further under- 1 144 INDUSTRIAL AMERICA IN THE WORLD WAR DISCIPLINING A NATION 145 t..: If. h' I) k :;!' 1 1 ,4 r stood," this definition continues, "that at present the priority committee of the General Munitions Board has no power in regard to the determination of priority in regard to civilian needs in which the army and navy requirements are not involved. It is further understood that, as between the needs of our allies and of our civilian population, the priority committee of the General Munitions Board has no authority to act." The Board had declared for a real priority system, but war was not yet the paramount business of the Nation; and a council composed of the heads of six great Executive departments, each jealous of power and humanly ambitious for war honors, held inherently too many of the elements of indecision and procrastination. Also, it was reluctant to enter the limitless field of general industrial control, which a complete priority system would have involved, in view of the vagueness of legislative authority for such an enterprise. In determining priority for Government business, it was on safe ground because it was authorized to act for the army, the navy, and Shipping Board, on which priority rights had been conferred by Congress. At that stage of the development of the general public's war spirit or that of industry, the approval of those affected by the Board's requests could not have been counted on. Later on, the War Industries Board had the legal basis for priority regulations that flowed from the Lever Food and Fuel Act and the Transportation Prefer- ence Act of August 10, 1917. Although in transportation only did it have direct legisla- tive authority relating to priority, the pooling of the powers by which priority could be enforced gave the Board a club with which to enforce regulations; but in all matters of priority in civilian goods it was without legal authority to order the doing of the necessary things, which it was in a position to enforce by indirect pressure. In these circum- stances the Board felt it was more politic to request than to demand compliance with its regulations. It was no offense for an irate manufacturer who was far down the priority list to consign the Board and its chairman to inferno and flatly refuse compliance with its requests; on the other hand, the Board was not exceeding its authority if it arranged for the Fuel Administration to refuse coal to the obstructive manufacturer, and for the railways to deny him cars. Of course, he had to come into camp. Yet it is important to point out that if industry had not early become animated with the war spirit of sacrifice and accommodation, and had not perceived the necessity of unity of action and discipline in its sphere as much as in the purely military sphere, the War Industries Board's career might have been one of endless bickerings and squabbles to an inglorious end by Congressional action. After the Government took over the railways, the occasional rebel did not have a chance unless he was absolutely independent of railway transport and fuel. The War Industries Board was wise enough to pivot all priorities on the Transportation Preference Act. Under the act the President appointed Judge Robert S. Lovett, chairman of the board of the Union Pacific Railway, as Director of Transportation Priorities, and he was made Priorities Com- missioner of the Board. A new priorities committee was then formed with Edwin B. Parker as chairman. This was in the latter part of August, 1917, so that it may be safely said that priorities as a system was not really developed before the fall of 1917. It came to its zenith in the reorganization of the War Industries Board, following Mr. Baruch's appointment as chairman. At that time. Judge Lovett having joined the Railroad Administration, Judge Parker, as he was familiarly known, had become Priorities Commissioner and was rapidly building up the Priorities Division. The Priorities Commis- sioner, besides having the statutory control of preference in railway transportation, was authorized by the President, the Secretary of War, the Secretary of the Navy, the chairman of the Shipping Board, and the president of the Emergency Fleet Corporation to exercise by himself and through the Priorities Committee such powers as they had respecting preference. Finally, the President's letter of March 4, 1918, to Mr. Baruch, which was in effect an Executive order, conferred on the War Industries Board for priority purposes all the implied war-time powers of the Executive. At this time the M i ■ 1 ' II 1 I I . . a «< 1 146 INDUSTRIAL AMERICA IN THE WORLD WAR feeble and merely advisory priorities committee of the spring of 1917 became a stalwart agency of industrial administra- tion by Government. It was a potent factor in price-fixing, in conservation, curtailment, conversion, material rationing, regional dispersion of industry and general regulation thereof; and its application shaped the draft on man power for the army and navy. Just as the War Industries Board mtertwined itself among virtually all Government agencies, so the priorities function and power were mixed with almost everything the Board did. The Priorities Division^ consisted, besides the Commis- sioner, of two bodies, the Priorities Board and the Priorities Committee, of each of which the Commissioner was chair- man, and three sections for the special administration of priority in regard to transportation, labor, and non-war con- struction. The Priorities Board was the moulder of policy and the Priorities Committee more of an executive, especially in routine and minor matters. The Board contained in its membership representatives of the great purchasing and economic control bodies of the Government, including the Emergency Fleet Corporation, the Fuel Administration, of the Allied Purchasing Commission, of the navy, of the Railroad Administration, of the army, and of the War Trade Board. The committee was some- thing of a mongrel in its composition, being made up of functional members, commodity representatives, and repre- sentatives of the army and navy as such, its composition *Major-General J. B. Aleshire was chairman of the original Priorities Com- WH'T^'fi '^? ^"^^'^ of National Defense. The membefsWp of thf PrioSt" rh«Ylr. ^^^^ a'^^^^' r^- ^i™ ^' P^'k«'' Priorities Commissioner, chairman; Bernard M. Baruch, ex-officio; Major-General George W GoethaR amy representative; Qarence M WooUey, representing the War IrkA^Bo^f; t^dward Chambers, representing the Railroad Administration; Charles R. Pie^ representing the United States Shipping Board and Emergency Fleet Corpora- tion; P F. Noyes, representing the Fuel Administration; T. F. Whitmarsh, representing the Food Administration; Alexander Legge, vice-chairman of the War Industries Board, also representing the Allied Purchasing Commission; and Felix Frankfurter, chairman of the War Labor Policies Board. H. O. rmiiipps acted as secretary. The following was the personnel of the Priorities Committee: Edwin B. Parker, PnonUes Commissioner, chairman; Charles K. Foster, vice-chairman; Hopkins, Henry KrumbF H. Macpherson, Rear Admiral N. E. Mason, Lieu- tenant-Colonel C. A. McKenney, Everett Morss, Lucius P. Ordway, T. C. fcn* 1% Admiral A. V. Zane. Maurice Hirsch acted as secretary, and Marcus a. Hall as assistant secretary. t1 DISCIPLINING A NATION 147 being designed for administrative detail rather than for counsels of policy. _ Stated in the simplest terms, the functions of the Priorities Division were "to determine, whenever necessary, priorities of production and of delivery and the proportions of any given article which are to be made accessible to the varying demands for it." This — the War Industries Board's own definition — points out that production priority involves pri- ority in respect of plants, fuel supply, electric energy, raw materials, finished products, labor, and transportation in every form. The object of the priorities system, it was explained, was "by means of its function to resolve the con- flicts that arise in the execution of the military and industrial programmes over the production and distribution of com- modities and the use of incidental agencies." As the interdepartmental f ormulator of "general plans for the coordination of the military programme, as presented by the military authorities, and the industrial programme, in so far as such programmes demand priorities," and as the desig- nator of the agencies for the carrying out of the programmes, the Priorities Board became one of the mightiest centers of power in the Government. As the Requirements Division brought all the Government departments and agencies vitally interested in war problems together to study and order requirements and to project policies into the future; so the Priorities Board brought them together to coordinate policies in their concrete application to production and delivery. The former sought to harmonize future demand; the latter to meet formulated and projected demand and coordinate them in fact. The difference between priorities in the early war days and priorities under the fully organized War Industries Board was the difference between night and day. The Requirements Division and Clearance paved the way for automatic priority for the direct demands of the army, the navy, and of the Shipping Board, but the Priorities Board had to lay down a large scheme of group and individual priorities to protect the ultimate supplying of such demands and to restrict civilian consumption of foods, materials, and facilities to the barest minimum consistent with national health and safety. Except as food and fuel were already i. .iu y » , •I K 146 INDUSTRIAL AMERICA IN THE WORLD WAR controlled by their respective administrations, the War Indus- tries Board now, through priority, came into control of virtually the whole industrial life of the Nation, and, through the relation of priority to the selective draft, in that it deter- mined what were essential and non-essential industries, affected the personal destiny of millions. General Crowder issued the dictum: "Work or fight." The War Industries Board determined the choice for vast num- bers of men between the camp and the shop or office, for its policy was to close out or curtail industries unnecessary for the time being. Even mere directly, the Board indicated to General Crowder the occupations he could cull for soldiers without danger of serious civil impairment. The complex problem the priority function was to solve was fundamentally the ordering of the whole materially pro- ductive life of the country so as to serve military wants in the order of need to the greatest possible extent consistent with the maintenance of the fabric of economic life and of the physique and morale of the civilians. It necessarily involved not only the application of prefer- ence as between nations, between domestic military and civil needs and among categories of military requirements, but also of discrimination in civil requirements. It involved in a broad sense the rationing of all the people and of all the industries. It was obvious that it was physically impossible to take each and every one of some thousands of commodities (though possible and actually practiced with certain basic commodities) and determine a system of fractional priority or participations, by which every necessitous demand would be met in the degree considered advisable. It would have been almost as hard, even if the total supply of commodities had been directly under the administration of the Board, to assign to each valid application for priority the precise numerical order of its participation. In fact, the War Industries Board had to work priority without knowing definitely just what was the full legitimate demand and what the total supply with which to meet it. It had to take a chance on the unknown and lay down a fixed rule of access to materials and facilities in accordance with the relative importance of certain general requirements in DISCIPLINING A NATION 149 respect of the big national business of winning the war. It was quite prepared to see dispensable industries find the stores exhausted when their turn came, but it had to depend on its judgment and on the willingness of the people to bear privation as to whether some of the minor so-called indis- pensable requirements were met. The simile of eggs in a basket was used by General Hugh S. Johnson to present the solution of the problem in a graphic manner. A, B, C, and D have varying needs for eggs of which the basket contains an unknown number. Because of uncertainty as to the number of eggs, it is impossible to allo- cate them according to intensity of need among the four applicants for them. For the same reason it is not certain that A and B, as representing the most pressing demands, can be supplied by definitely curtailing C and D. Assuming, however, that A's need is paramount, we can say that he shall take the eggs so long as he needs them, and that thereafter B, C, and D may indiscriminately help themselves or have singular access to the balance according to the relative importance of their wants. If none of the three represent indispensable industry, it may be convenient to let them help themselves; or, if they vary in importance, it may be advis- able to give B first chance at what A leaves, and so on. This is the skeleton of the priority system. It had its dangers, but it worked despite the fact that the War Industries Board did not attempt to police A, B, C, and D, and further despite the fact that it did not itself hold the eggs, even unknown as they were. The four groups of the parable increased as the war went on until on July 1, 1918, Circular No. 4 made them coinci- dent with the population by saying, "During the war in which the United States is now engaged all individuals, firms, associ- ations, and corporations engaged in the production of raw materials and manufactured products (save foods, feeds, and fuels) are requested to observe regulations respecting pri- ority" — and, of course, through the proper administrations priority was applied to the three exceptions. Priority was localized in the War Industries Board and was its creation, but the composition of the Board made it the fountain-head of the application of the priority principle \\ V i n Iff fl 150 INDUSTRIAL AMERICA IN THE WORLD WAR for the Government as a whole. In this aspect it had a cer- tain weakness, for, although presidential authority always stood behind it, there was a degree of lost power in applying it through bodies that were organizationally as supreme in ships, external trade, foods, feeds, and fuel as the War Industries Board was in the general field of industry. A perfect organization would have had the Board, or at least the priority administration, unquestionably supreme in the whole field of production. The original Priorities Committee got under way in a com- prehensive manner on September 21, 1917, when it issued Priority Circular No. 1, giving general directions and infor- mation as to procedure under its authority. It directed that iron and steel producers should "rate" their orders for prod- ucts. Before that time large numbers of priority questions had been decided individually, but thereafter there was a formal system of receiving and granting applications for cer- tificates of priority. The first certificate was issued on Sep- tember 25th, and from that time until the suspension of priority after the armistice more than 211,000 applications were dealt with. On the record day for applications 1901 were received and the maximum number of certificates granted on one day was 2121. The method of rating established by the first circular pro- vided for the division of all work and orders into five classes alphabetically designated according to order of precedence. Class AA comprised all urgent and exceptional war orders; Class A included all other war work in general, such as arms and ammunition, naval and merchant ships, airplanes and locomotives; Class B was made up of demands for produc- tion which, while not primarily for war purposes, were neces- sary to the maintenance of national vigor; Class C took in all orders and all work not covered by priorities certificates or by the later established automatic ratings which contributed to purposes entitled to preferential treatment, as set out in a preference list. No certificates were required in this class nor in Class D, the residuary class. There was further subdivision of the classes. For example, to start the systematic work of administering priority with a clean sheet, all orders for products given by the War and \\ DISCIPLINING A NATION 151 Navy Departments and the Emergency Fleet Corporation before September 1st, were put in Class Al. The applica- tion of priority, according to these ratings, did not mean that every order received by a factory should be first attended to according to its rating, but only that the rating should be so observed as to insure the completion of each job in the con- tract time. Thus the reception of an AA order did not mean the dropping of work on other orders so as to complete the AA order first, but only such a modification of factory pro- cedure as would insure the filling of the AA order within the prescribed time. The Priorities Committee did not undertake ordinarily to issue precedence orders to each producer. The holder of a certificate of priority called for his materials and facilities from other manufacturers and exhibited his certifi- cate in order to obtain the place in their manufacturing schedules to which it entitled him. In time, it developed that automatic ratings could be assigned to a considerable portion of orders, and when all industries were put under control July 1, 1918, a scheme of automatic ratings was simultaneously applied, which avoided an administrative breakdown from the immense amount of detail that would otherwise have been involved. Under this scheme the recipient of an order which would naturally fall into certain of the lower ratings would attend to his own priority rights, supporting his orders under them with an aflBdavit setting forth the facts entitling him to the rating named. The Priorities Board and the Priorities Committee issued circulars defining the classification of purposes demanding preferential treatment, the one issued by the former on the day of its establishment, March 27, 1918, being the final one and having the superior authority that came with the wider scope of the board as distinguished from the committee. This general classification of purposes was later supported by a list of preferred industries, divided into four classes of preference, which was extended until it covered seventy-three industries and specified seven thousand plants whose product was of such a nature that it was considered that they should have special ratings above or below those into which they would fall according to the classification of purposes. The I- ■I t ;f i .^ H 152 INDUSTRIAL AMERICA IN THE WORLD WAR first class of industries had preference over all others in the production and supply of fuel and electric energy, transpor- tation, and labor. The distinction between the three remain- ing classes was not hard and fast in practice, but was made rather as a means of giving a general view of the relative importance of different kinds of industry/ All four classes enjoyed precedence over unclassified industries. Priority, of course, was as inevitable as the force of gravity, as a part of any system of industrial control for war purposes. It was part of the munitions administration of all nations. A unique feature of its American use was that it was essentially voluntary and cooperative. The main lines of priority were virtually acquiesced in by what amounted to a congress of industry, before they were decided upon. Indi- vidual applications of priority were almost invariably approved by the judgment of those adversely affected when they were asked to decide for themselves in view of the gen- eral need and welfare. The annals of the War Industries Board are replete with instances of men and corporations writing their own death-warrants, as it were. Objections to priority regulations almost without exception proceeded from the isolated, individual point of view. When a complainant came to the War Industries Board bursting with what seemed to him righteous indignation, he would cheerfully reverse himself when the public welfare point of view was presented to him. The spirit of service for the common good was ultimately supreme in all men in those times. The American business man never showed himself more favorably than in his relations with the War Industries Board. When the hour of sacrifice came, he gave his busi- ness to the Government as freely as he gave his sons. The writer believes that the War Industries Board, after March, 1918, had ample power to effect anything it under- took, however vague, indirect, conditional, legal, or non- legal that power was. It is true, however, that most of the big business men in its service hold the view that, while its Tor texts of circulars and orders of the Priority Board and the Priority G>inmittee and administrative details see American Industry in the War (Gov- ernment Printing Office, Washington), being the final report of the War Indus- tries Board; and the War Trade Board's Government Control of Prices, issued in cooperation with the War Industries Board. DISCIPLINING A NATION 153 moral and effective power was practically unlimited, its legal authority was so precarious that it effected its ends by suffer- ance rather than by authority. This position is doubtless due to the fact that, because of the opportunities for legalistic casuistry concerning many phases of the Board's work, and because there was a time when it had no authority, these executives had got into the habit of asking cooperation. It was so freely granted that they rarely had to think of the power behind them, and, in fact, they hated to appeal to it. When you do not have to use power to effect common action, you prefer to forget that you have it. A reasonable, flexible, human organization, like the War Industries Board, undoubt- edly derived more dynamic force from the spirit of coopera- tion it encouraged than a rigid, statutorily superimposed executive agency could have commanded. Such an instru- mentality might have enforced all that the law required, but the cooperative medium got far more. All men work better "for us" than "for you." Priority administration had an effect that was somewhat beyond the domain of the War Industries Board in the strict conception of the latter. Even when his powers were prac- tically unlimited, Mr. Baruch held the view that the Board was not to interfere in purely military matters; that, broadly, it was for the war-making agencies to determine what they required of industry, and for the Board to see that they got it. But, in seeking to meet these wants through priority and allied functions, the Board was many times forced to inquire whether military demands could not be modified or restricted. At one time the army actually called for twenty suits of underwear for each soldier in France, on the theory that because of vermin they would have to be thrown away at the end of a week's use. The strain of such an order on the knitting industry led to inquiry, the systematic use of delous- ing apparatus, and the substantial reduction of the order. There were many similar cases — often leading to whole- sale cancellations; but in general the Board accepted mili- tary estimates, with the result that many industries were overstrained in efforts to produce within a short time things that would not be used up for a long time. Of course, the long, precarious, and slowly operating supply line between i- i HI I. l-i- U 154 INDUSTRIAL AMERICA IN THE WORLD WAR America and France necessitated that several months' con- sumption requirements should always be en route, in addition to prudent reserves; but, even so, there was an insistent effort to obtain more than the country could produce. It was not physically possible to buy and obtain within a year the amounts of goods represented by army funds set aside for that purpose — more than $15,000,000,000 in 1918. Had the War Industries Board been projected a little more into the military estimates of requirements, there would have been a much more equable flow of orders. By the instrumentality of priority the War Industries Board directed both production and distribution; it said what should be produced and where, and it said who should have the product. After the Board had extended its control to all industry not otherwise under Government control, American industry was for the time being nationalized as to management; and, through the war and excess profits tax and surtax, nationalized as to profits. It performed services according to Government direction and for the profit of the Government. Individualistic American industrialists were aghast when they realized that industry had been drafted, much as man power had been. What none had foreseen had come to pass. Had any man said in 1916 that the whole productive and distributive machinery of America could be directed success- fully from Washington, he would have been called a lunatic. Yet in 1918 that was being done. That it was a fact and not a theory was due to the transcendent spirit of the times. Business willed its own domination, forged its bonds, and policed its own subjection. There were bitter and stormy protests here and there, especially from those industries that were curtailed or suspended. Few men are great enough to see with equanimity their factories silenced when all around them is the clamor of imwonted business activity. Yet ninety- nine times out of a hundred the most resentful voluntarily made the sacrificial choice when asked: "Will you take this material or will you let the boys in France have it?" The administration of priority was a complex and delicate task. Should locomotives go to Pershing to help him get ammunition to the front or should they go to Chile to haul DISCIPLINING A NATION 155 the nitrate without which there could be no ammunition? Should steel go to destroyers whose mission was to sink sub- marines or to the merchant ships the submarines had thinned to the point of breaking down of the food supplies of the Allies? Should brass go to binoculars without which cargo ships could not leave port or to shells without which they need not go at all? Should nitrate go to munitions without which guns were useless or should they go to fertilizers with- out which the artillerymen would be foodless? Should ace- tone, indispensable for British explosive, go to the powder mills or to airplanes which needed it for their wings? Should chrome steel go to indispensable army trucks or indispen- sable army munitions? Should women be condemned to steelless corsets or tinless preserved vegetables? Should cranes go to American wharves for loading ships for France or to French wharves for unloading the same ships? Should ships from Brazil bring coffee to bolster civilian morale or manganese for fighting steel? Should coal go to Italy to power munitions plants there or to coke here for steel for those plants? Should long-staple cotton go to tires for army trucks or to fabric for airplanes? The wisdom of Solomon could not have infallibly decided all these questions and thousands like them — often posed by strenuous and commanding men, feverish with the excite- ment of the productional race against time. But they were decided — and a decision was the main thing. No error of judgment in such matters could equal no judgment. Deci- sion gave birth to order. It would be overstating the case to give the impression that priority always worked like a clock. When any organization gets to that point in growth where dispositions are made automatically according to a prescribed routine, it enters the red-tape period, and as yet nobody has discovered how exten- sive business or government can be handled without system, which is the respectful name for red-tape. It is related that a priority order once reached the Baldwin Locomotive Works several weeks after the "rush" job for which priority was therein directed had been completed and shipped. In this case the Baldwin people simply had gone ahead with a task, which their own judgment told them was of a preferred nature. 156 INDUSTRIAL AMERICA IN THE WORLD WAR DISCIPLINING A NATION 157 I ( i' i n I < The free-and-easy methods of such a democratic body as the War Industries Board, which was always emphasizing cooperation and minimizing compulsion, made it easy for bold spirits to ignore the rules. One great manufacturer proudly told the writer that he never paid any attention to official priority. "I always got what I wanted and got it when I wanted it," he said. However, as his plants were exclusively occupied with war work, the flexible Priorities Division may have provided for this autonomous administra* lion of priority. Nevertheless, there were many and devious ways of beat- ing priority, which were sometimes resorted to for the gen- eral good, and at other times for the most sordid reasons. An instance of the former was when, under a district rail- way embargo put on to clear up a congestion of traffic, a large munitions plant was unable to get shipment of an essential machine from a plant in another city. It found a way to beat the rules and get its machine when every effort to get a priority shipment right failed. Certain swindling jobbers of lumber made a fortune by taking advantage of automatic priority through a scheme of getting railway trans- portation preference under false representations. Priority stepped on a lot of toes besides those directly banged by the preferential decisions. When demand exceeds supply, preference is in the hands of the seller and so the purchaser pays him for priority, the priority that goes to the man with the most money. Administration of priority by the Government took that element out of prices, and a lot of profiteering fortunes that were on the ways were never launched. But here priority merges into price-fixing, a topic to be dealt with in another chapter. Notwithstanding the profound effect of priority in the direction of price-stabilization by establishing an orderly sequence of the satisfaction of demand and insuring supplies of materials to the holders of Government contracts, the dour critics who insist that the United States won the greatest war in its history by failing in every department of the war effort now contend that the Government should have followed the peace-time method of letting contracts by bids. The method actually followed was that of either negotiated or fixed prices, with priority as a means of general coordination of industrial sequences and interrelations. Competitive bidding under war conditions with the Government as an urgent buyer of all that could be produced would have been a mockery and with such a continuous confusion of production and stim- ulation of prices as can hardly be conceived. Competitive bidding in such circumstances is incompatible with such an indispensable regulator as priority or with such a brake as price-fixing. After the principle of priority had received general recog- nition, it became the most potent implement of industrial strategy, because with it industrial control became flexible; and industrial forces could be advanced, retired, and shifted to the flanks in the economic combat with the Germans just as surely as Foch could move his divisions and armies in the military conflict. For example: In August, 1918, the French reported that the draft of the combined French and American armies on French 75 mm. shells was unexpectedly greater than produc- tion and that the reserves were being perilously depleted. They had fallen from 30,000,000 to 13,000,000. The Ger- mans were on the run and then was the time to hammer them without stint. No shells were coming from America, and yet the French munitions plants were working only half-time for lack of steel. Within five days of the time that the French reported the situation to the Foreign Mission of the War Industries Board, the Mission had satisfied itself of the correctness of the French representation and cabled the Board for immediate assistance. On the sixth day, by direction of the War Industries Board, the Lackawanna Steel Company and the Carnegie Steel Company were diverted to the pro- duction of 75 mm. steel and the first shipments arrived in France within three weeks. The steel was actually arriving in France before the French Ministry of Munitions had formally placed orders for it. It came rolling into the French shell plants in such unfailing quantities that, with the ten thousand guns of the American and French batteries blazing away as never before, the French reserves went up to 19,000,000 shells. That is priority in action. That is industrial strategy in •I » 158 INDUSTRIAL AMERICA IN THE WORLD WAR war. Foch's manipulation of his millions was magnificent. But suppose their caissons had been empty, as they would have been but for the industrial manipulation in America — three thousand miles away! Anybody will tell you that no American shells were dis- charged in France, but nobody will tell you that but for American steel, rushed to the front in the supreme emer- gency, there would soon have come a time when there would have been no French shells either. It was much the same with airplanes. We did not get large numbers to France, but, if we had not rushed the supply of steel, parts, spruce, motors, and a hundred other things to the French and British factories, there would have been very little Allied flying in the last months of the war. Let us turn to another form of industrial strategy made possible through the flexibility of manipulation of industrial facilities by means of priority. Toward the end of the war General Pershing's artillery was on the verge of quiescence because of the lack of horses and mules to drag guns and supplies over the ruined roads and across country at the front. Spain had a surplus of mules, but would not sell them. The War Industries Board, through General Dawes and the War Trade Board, found that Spain was in desperate need of ammonia sulphate as an ingredient of agricultural fertilizers, but could not import it because of the appropriation of the entire supply by the Allies for the manufacture of explo- sives. America itself was desperately short of ammonia sulphate, but Pershing needed those Spanish mules worse than the sulphate was needed at home, and the Spaniards needed it so much that they were willing to exchange for it the strategic mules that no gold could buy. The button of priority was touched; the embargo on the exportation of ammonia sulphate to Spain from the United States was raised; the Spaniards got their fertilizer and Pershing got his mules. Industrial strategy again. With the establishment of the Priorities Board on the massed authority of the President and of the Navy and War Departments, the Shipping Board and the Emergency Fleet Corporation, the War Trade Board, the Fuel Administration, the Food Administration, the Allied Purchasing Commission, DISCIPLINING A NATION 159 such direct Congressional authority as there was for priority, and with all the authority conferred on or acquired by the War Industries Board, there came into existence the apical form of industrial control known to the United States during the war, a form which eventually applied to all industry. While its legislative authority was vague, partial, and of patches, it put all industry inescapably into the hands of the War Industries Board, for there was no appeal from the decisions of the Priorities Board except to the chairman of the War Industries Board and the President. The rents in its garment of authority were amply filled by the docile and cooperative spirit of industry. The occasional obstructor fled from the mandates of the Board only to find himself ostra- cized by his fellows in industry. Through the development of the principle of priority and of its administration, the long-sought coordination was attained in theory and in prac- tice to the full degree that might have been expected in view of the early termination of the war and the defect of its placement in the general scheme mentioned above. It was the supreme implement of the direction and discipline of nationally integrated industry. And, be it noted anticlimactically and bluntly, priority became what it was only when the President notified all of the war-working agencies that no priority order would be issued without the approval of the chairman of the War Industries Board. M THE CONTROL OF PRICES 161 i I I .i it y i< CHAPTER IX THE CONTROL OF PRICES Public justice and price-fixing; but above all, production for war — Raw materials the heart of the problem — Forestalling the profiteer — The famous copper agreement — Checking the rising prices — Steel control — Price-regula- tion in a democracy — Wilson and prices — An isolated judicial body — Baruch's conception of industrial control — The mechanics of the question — Avoiding rigid policies — Sense and sentiment in prices — Judge Gary queries Judge Lovett — General results of control. The Government of the United States as a regulator of prices through the War Industries Board was not, contrary to popu- lar notion, primarily the champion of the oppressed people against extortion and profiteering. The dominant object of the Board was to support the army and navy in winning the war; it was the civil side of the great engine of war. Price- regulation was an instrumentality of the paramount function of the Board. It and priority, which was at the base of clear- ance, curtailment, allocation, conservation, etc., were the two great implements with which the Board attained its ends. In the beginning all use of both of these tools had for its immediate object the stimulation of production, for war uses, under whatever guise they appeared. It is true that from the first there was a motive of public justice in price- control and that, as the war went on, this motive loomed larger and larger. But, even when yielding to consideration of that motive, the Board was always thinking of production for military purposes, having in mind that the preservation of the public morale and physical health were essential to the realization of 'that end. The War Industries Board had no powers, direct or indi- rect, to regulate prices as a matter of social justice. Vague and informal as its legal power to deal with prices was, there was in fact almost no limit to it so long as it was exercised for war purposes. Excessively high and especially unstable prices interfered with production just as much as disorder in the conduct of industry. So the War Industries Board used that instrumentality of price-control to meet that side of the production problem, just as it did the instrumen- tality of priority to meet the other. The Price-Fixing Com- mittee was in effect the paymaster-general of war industry and the Priority Board was the general manager. It was all purely a matter of doing the Government's business of the time, the great business of war. Like many other things the War Industries Board did in the course of its growth, the function of price-regulation existed before the specialized agency thereof. The question of prices was fundamentally involved in that of voluminous production, the Raw Materials Committee of the Advisory Commission of the Council of National Defense was con- cerned with it from the beginning, and on April 17, 1917, the Secretary of War authorized the General Munitions Board to determine fair and just prices when asked to do so by department heads. Raw materials were the roots of the industrial tree, and it was seen as necessary that they should be fed with prices that should be neither too high nor too low. After the raw material stage the Board merely as a successful war-making agency was little concerned in price-regulation as a funda- mental thing, for, with its other forms of control grouped under priority, it could obtain its finished goods at its own prices without setting up an elaborate price-making mecha- nism. This is why the War Industries Board, so long as conditions permitted it to keep away from the remoter inci- dence of war, did not concern itself with secondary and retail prices of the products for which it fixed the primary prices. It was not, like the Food and Fuel Administrations, designed from the beginning as a protector of the public purse and the public welfare. It was primarily a war machine; the magnified supply department of the army and navy. It should not be inferred that the War Industries Board thought of prices only as a medium of stimulating produc- tion. Even before war was declared, Mr. Baruch, as chair- man of the Raw Materials Committee from which the War Industries Board inevitably grew, grasped the spiritual as well as the substantial element of the problem. A price, excessive to the point of public injustice, might stimulate the V n t 162 INDUSTRIAL AMERICA IN THE WORLD WAR production of the given commodity, but it would tend, he perceived, through psychologic reactions to weaken the war spirit, and thus check production in other commodities. Nothing undermines the will to war so rapidly as the popular conviction of widespread profiteering and exploitation. Also, the higher the prices, the higher the Government expenditures, the higher the taxation, and the greater and more difficult public financing, the earlier the economic exhaustion of the Nation ; again, the higher the prices, the greater the inflation of currency and credit and the weaker the economic fabric. An early motive for interfering with market prices was to disabuse the crystallizing war mind of the idea that the war was being brought on by the great industrialists for profiteer- ing purposes. The army and the navy had immediate use for forty-five million pounds of copper in March, 1917, at which time spot copper was selling as high as thirty-seven cents a pound. Mr. Baruch, who for some months had already been familiarizing himself with the sources of the raw materials chiefly needed in war, in cooperation with Eugene Meyer, Jr., conceived the idea of appealing to the patriotism of the copper producers to make a price on this initial war order that would determine the plane of industry as an aid to Government in the coming war. The outcome of this appeal was a Government price of sixteen and two-thirds cents a pound, determined by taking the average price for ten years preceding the war. There was little if any resistance on the part of the pro- ducers to the appeal. They knew and were told that diey were setting an example that would be used against their selfish interests and those of all industry throughout the war that was impending. They were establishing the cri- terion by which all prices would be thereafter measured; the criterion of a price that would be in accord with public interest. The announcement of a Government copper price fifty per cent below the market price did have a most reassuring eff'ect on public opinion. It was not a mere dramatic gesture either. In a broad way the spirit of that copper price decision, made so freely by the copper interests, was the spirit of industry throughout the war. The writer makes this comment with the THE CONTROL OF PRICES 163 full knowledge of large numbers of indisputable instances that may be cited to the contrary, some of which are noted in difi'erent places in this volume, and with full knowledge that corresponding to the proportion of base and noble strata in men there were thousands of sordid, selfish exploiters of the war needs of the Government and of the people. On the whole, the industrial side of the war, both in its administra- tion by and for the Government and on the part of the manufacturers and merchants, was on a high plane of duty. There was almost no direct peculation and but little conscious profiteering at Government cost. This was due partly to the spontaneous action of producers and partly to early Gov- ernment action through the War Industries Board that made the prices of the chief materials subject to what amounted to Government determination. While the informally negotiated early copper price served to establish a precedent and a standard, it was an example rather than a precept and was in no sense automatic in its efi'ects on other industries. It was many months before the priority principle was converted into a system, so that in the beginning of the war its stabilizing influence was not a factor in prices. Unregulated demand on an unparalleled scale was opposed to limited and disordered supply. The markets had become erratic under the eff'ects of the tremendous buying of the Allies in the United States before we entered the war. Our exports to Europe had ascended from $1,500,000,000 in 1914 to $4,300,000,000 in 1917. Price was a minor consideration with the hard-pressed Allies in dire need of supplies from America. They had thousands of buyers in the field who were eager to do busi- ness with any one who could promise delivery. Large num- bers of brokers, speculators, and promoters appeared in the field and there was much wild buying and optioning. The apparent demand thus became even larger than the actual demand. Commodities were held up in their usual channels or diverted from them; all the usual and orderly processes of industry were disturbed. There was no foretelling the prices of raw materials, and huge margins of safety were added to normal profits to say nothing of opportunistic profiteering. « Hi h i, '( • 1 ' i' t w I ( \l' U 164 INDUSTRIAL AMERICA IN THE WORLD WAR With its entrance into the war the United States Govern- ment added to the demand side of the already unbalanced scales the weight of eight billions of extraordinary demands m 1917 and fifteen billion dollars in 1918. Prices rose most alarmingly, not only for the Treasury and the taxpayer, but for efficient production. By July, 1917, the average price of metals was almost three and one-half times what it was in 1913, and eighty-six points above the price in March. Basic pig iron jumped from $32.25 a ton in March to $52.50 m July; steel plates from $4.33 to $9; wheat from $1.98 to $2.58; according to weighted index numbers foods went up twenty-five per cent in this short period. As demand promised to become larger and larger, and as the law of supply and demand had been suspended because Government buying for war purposes had to go on regardless of the pressure of high prices, which in ordinary times create their own repression by curtailing demand, it became appar- ent to the authorities in Washington that the scales would have to be balanced by governmental control of some sort. The Government, as the author of the disturbing demand, could not remain indifferent to its power to deprive it of its price-inflating tendency by arbitrary action. Pending the determination of Congress and the President to meet the price problem, the Raw Materials Committee of the Advisory Commission and the same division of the War Industries Board continued the informal price negotiations for Government requirements that had begun with copper. Its various commodity sub-committees and the supply com- mittee and sub-committees were collecting data and generally familiarizing themselves with the situation, and through clearance, a measure of allocation, and a study of require- ments were beginning to get a grip that gave them a certain control of prices without definitely and arbitrarily fixing them. The steel producers emulated the copper men by agreeing to deliver five hundred thousand tons of steel at one third less than the market price, and the lumber committee voluntarily quoted the Government prices for lumber considerably below those of the general market. The producers of zinc and lead voluntarily made large concessions to the Government. The THE CONTROL OF PRICES 165 union of the General Munitions Board, the Raw Materials Committee, and the Supply Committee of the Advisory Com- mission, to form the War Industries Board, just at the time that the price problem was becoming insistent, gave a con- centration of the industrial side of the Council of National Defense, theretofore lacking, that enhanced its capacity to deal with prices as well as with other phases of the Govern- ment's economic problem. The concentrating of the allocation of Government and Allied purchases through the Commodity and Supply Com- mittees took much of the uncertainty, and, therefore, the inflation, out of business so far as Government orders were concerned. In fact almost everything the War Industries Board did had an eff"ect on prices. Nevertheless, it became more and more evident that there must be some sort of direct control of a more drastic nature. Although the steel people had given the Government a marked price concession early in the war, the steel market continued to be a "runaway" one; coal and coke and many other things were on a rampage. The chairman of the Ship- ping Board threatened to commandeer steel mills if prices were not aligned with the results of a cost investigation then under way by the Federal Trade Commission; the Secretary of War declared that the prices of steel and iron must be controlled; the Secretary of the Navy declared that the Gov- ernment would not pay exorbitant prices for steel; and the President, on July 12, 1917, warned industry that there must be a "just price," that law "must of course command the^e things," and declared that the Government was about to attempt to determine prices. The President also laid down the rule that prices for the Government must be the same as for the public, for "prices mean the same everywhere now; they mean the efliciency of the Nation, whether it is the Gov- ernment that pays them or not; they mean victory or defeat." Steel is as all-powerful in war as in peace. It is the basis of the basic raw materials. Control its price, and you auto- matically control a host of prices. It was but natural that it should be the subject of the first formal price-control. The industry itself, at first opposed to control, came later to believe it to be necessary. All through the middle and late ;l 'I h m H| .?! I " K 166 INDUSTRIAL AMERICA IN THE WORLD WAR summer of 1917 the War Industries Board studied the ways and means of steel control, and the passage of the Food and Fuel Act in August, which specifically gave the President the right to "requisition foods, feeds, fuels, and other supplies necessary to the support of the army or the maintenance of the navy, or any other public use connected with the common defense,'' certainly strengthened and broadened the requi- sitioning phase of the Executive's war powers. It did not authorize price-control, but it made it easier; and, after all, there is but a nice and unneces^ry distinction between taking ruthlessly and taking at a price. The latter is certainly a derivative right from the former. Added to the commandeering powers already conferred on the War and Navy Departments and on the Shipping Board, the men of action who were in command of the war machine considered that they had enough authority for their purposes even if Congress did still hesitate to create a price- control as such. As Congress left the situation, it was sus- ceptible to a flexibility and adjustability of control that might have been absent under a law of prescription. The reluctance of Congress and even of the Executive to plunge into arbi- trary price-control is now seen to be wisdom, even if it were the wisdom of indecision. The democratic spirit of the Nation held it back from written expressions of the firm con- trol that was more or less inevitable; the stubborn conviction of the masses that Government must not meddle with private aff'airs except in extremes restrained the Government from arbitrary methods even when the most sweeping powers were exercised. The outcome was that virtually all Government measures that entrenched upon fields ordinarily left entirely to private effort were approved by the unwritten will of the people, and such articulate form as the measures did take were looked upon as aimed at the refractory minority rather than as an imposition of something detestable upon the majority. No good citizen resents a law of homicide, because he feels that he is quite outside its field. It is the law he himself would make to control the criminally inclined. The grand result of the whole gradual and "by consent" way in which the Government took its economic measures, though it veiled for THE CONTROL OF PRICES 167 a time the stem and rude side of war from the popular consciousness, was such an enthusiastic, voluntary partici- pation of the masses in the war enterprise as was, perhaps, unknown in the other great nations involved in the World War. In the case of steel, the record shows that from a rather unyielding and even grasping attitude at first the steel pro- ducers gradually softened and relaxed and came to take the public view. In the end there was not the sullen compliance that would have followed arbitrary action, but the cheerful and earnest cooperation of partners dominated by reason- ableness. Before the final step was taken, there was much coming and going from Washington and numbers of voluble and indecisive conferences. The basic prices of coke, steel, and iron were established at a conference of the War Indus- tries Board with sixty-five representative iron and steel pro- ducers on September 21st, though not promulgated by the President until September 24th.^ The copper price was also fixed on the former date. Although it was not the direct concern of the War Industries Board, coal being under con- trol of the newly established Fuel Administration, it is note- worthy that the price of coal was fixed a month earlier.^ Before the establishment of the Price-Fixing Committee in March, 1918, the War Industries Board itself had dealt initiatively or conclusively with prices for hides and skins, wool, munitions, linters, harness leather, sulphuric acid, nitric acid, cotton textiles, cotton linters, sand and gravel, manila fiber, building tile, sole and belting leather, rags, wool grease, compressing rates for cotton, brick, millwork, gypsum wall board, cement, various sorts of lumber, zinc and aluminum, in addition to copper, iron, and steel. The Board proper retained its informal control of lead, wood chemicals, nitrate of soda, alkalis, nickel, quicksilver, plat- inum, cotton textiles, cotton linters, wool, hides, skins, and leather, manila fiber and hemp, burlap, lumber, building materials, and chemicals. The reason of this retention was that, in the cases of these materials, there were involved so intimately other functions of the Board with which price- *See Chapter XVIII, "Steel: An Epic of the War." The Fuel Administration left the price of coke to the War Industries Board. 11 1. 1 ^t 168 INDUSTRIAL AMERICA IN THE WORLD WAR fixing was mixed that it was not practicable to surrender price-fixing to the committee. Particulars of the price-fixing of different commodities including steel and iron will be dealt with in later chapters. The establishment of prices was such a delicate matter and so charged with explosive possibilities that it was always a matter for presidential analysis and approval. As time went on, and it became necessary to take control over more and more commodities in which shortages developed, and as the control of prices of finished products began to loom, the price-fixing function became such a burden, in addition to its delicacy and complexity, that the necessity arose for the creation of a new agency for its administration. Price-fixing was a judicial function, which seemed to require a certain detachment from the administrative functions of the Board. It is true that priority, which in the last analysis was the principle which controlled all the other functional divisions of the War Industries Board, affected prices and that prices reacted on the administration of priority; but between price- fixing and the other functions of the Board there was such a sharp distinction as was to be found nowhere else in an organization which was remarkable for its lack of hard-and- fast boundaries between departments. This difference, indeed, was almost generic and led in the final reorganization of the War Industries Board to a curious division of the Price-Fixing Committee from the Board proper, even in authority. On the recommendation of Mr. Baruch, prior to his appointment to the chairmanship of the Board, the Price- Fixing Committee was named by the President and not by the chairman of the Board. It was the only part of the Board in which the chairman was not independent of committee action. The President enjoined him in the determination of prices to be governed by the advice of a committee "consti- tuted for the purpose," which should include, besides himself, "members of the Board immediately charged with the study of raw materials and of manufactured products, of the Labor member of the Board, of the chairman of the Federal Trade Commission, the chairman of the TariflF Commission, and the Fuel Administrator." *-f V ♦$^i " -s \ § % INTENTIONAL SECOND EXPOSURE . i| U I ! I 1. 168 INDUSTRIAL AMERICA IN THE WORLD WAR fixing was mixed that it was not practicable to surrender price-fixing to the committee. Particulars of the price-fixing of different commodities including steel and iron will be dealt with in later chapters. The establishment of prices was such a delicate matter and so charged with explosive possibilities that it was always a matter for presidential analysis and approval. As time went on, and it became necessary to take control over more and more commodities in which shortages developed, and as the control of prices of finished products began to loom, the price-fixing function became such a burden, in addition to its delicacy and complexity, that the necessity arose for the creation of a new agency for its administration. Price-fixing was a judicial function, which seemed to require a certain detachment from the administrative functions of the Board. It is true that priority, which in the last analysis was the principle which controlled all the other functional divisions of the War Industries Board, affected prices and that prices reacted on the administration of priority; but between price- fixing and the other functions of the Board there was such a sharp distinction as was to be found nowhere else in an organization which was remarkable for its lack of hard-and- fast boundaries between departments. This difference, indeed, was almost generic and led in the final reorganization of the War Industries Board to a curious division of the Price-Fixing Committee from the Board proper, even in authority. On the recommendation of Mr. Baruch, prior to his appointment to the chairmanship of the Board, the Price- Fixing Committee was named by the President and not by the chairman of the Board. It was the only part of the Board in which the chairman was not independent of committee action. The President enjoined him in the determination of prices to be governed by the advice of a committee "consti- tuted for the purpose," which should include, besides himself, "members of the Board immediately charged with the study of raw materials and of manufactured products, of the Labor member of the Board, of the chairman of the Federal Trade Commission, the chairman of the Tariff Commission, and the Fuel Administrator." 1 I 1 ifr •11: ^' I I'i ■I THE CONTROL OF PRICES 169 I I Hl^ 1 •I i n w* While the committee was to determine prices for the chair- man of the Board, it really reported them directly to the President, who always passed on them before they were promulgated. Nevertheless, the Board defined the functions^ of the committee, which always acted, not of its own initia- tive, but at the instance of the Board or some department of it. It was distinctly a committee of the Board, and yet only three of its members were members of the Board itself; at the same time the committee, in its function of determining prices, was absolutely independent of the Board and was responsible directly to the President. The initiative in price- control lay with the Board, but in determining prices or policies the committee acted as an isolated judicial body, divorced by its composition from a suspicion of bias, abso- lutely independent of administrative control and the partiali- ties or antagonisms that might arise therefrom. Prior to the final separation of the War Industries Board from the Council of National Defense, the latter body issued a statement regarding the purpose of the Price-Fixing Com- mittee, in which it described the committee as being quasi- judicial and separate and "made up of men separated so completely from industrial interests that their motives and actions in the determination of prices can be subject to no suspicion of mercenary interest." Chairman Robert S. Brookings, who had previously been at the head of the Finished Products Division of the Board, Chairman Baruch of the Board, and Henry C. Stuart (former governor of Virginia), who was on the committee as the representative of the public interest as contrasted with the specialized war interest of other members, were the only members who could be classed as business men who might have a remote personal interest in prices (although all three were strictly disassociated with active business) . ^Wlien the committee was called together by the War Industries Board, its functions were outlined as follows: **(!) to advise upon prices of basic materials; (2) from time to time to advise as to general price policies, acting in this way as a coordinating price body; (3) the committee will advise when requested by any department upon a specific contract, assuming, however, that no department will submit for advice those problems which it is organized and qualified to handle itself; and (4) when materials are commandeered prices of the same will be fixed by this committee." ni Ti Mi J' h '!' i'l t • 170 INDUSTRIAL AMERICA IN THE WORLD WAR But, even if their views on prices had been tinged by remote particular interests, they would have been outvoted in a committee of nine members, the other six of whom were Hugh Frayne, representative of Labor and at the head of the Labor Division of the Board; F. W. Taussig, chairman of the United States TariflF Commission; W^ B. Colver, chairman of the Federal Trade Commission; Dr. Harry A. Garfield, United States Fuel Administrator; Commander John M. Hancock, representing the navy; and Lieutenant-Colonel Robert H. Montgomery, representing the War Department. The Price-Fixing Committee bore about the same relation to the War Industries Board as the Federal judiciary does to the Federal Government as a whole: certainly the Supreme Court, for example, is a part of that Government, and yet it is in a position to oppose both the executive and the legis- lative arms. The Supreme Court supposedly promotes the policies of the Government by keeping it true to the Consti- tution, the organic governmental programme. The Price- Fixing Committee was designed to determine, without influ- ence of persons or interests, prices that would conform to the success of the function of the War Industries Board — which was to obtain and maintain adequate production in support of the army and navy. The specialization of price- fixing in a department of its own made the function a con- tinuous one; the committee was continuously at work and ready to pass on any question that might be referred to it; so that price-fixing became a process rather than a series of incidents. It is conceivable that a body which was a part and instru- ment of the War Industries Board, both in its membership and in its administration, and yet largely autonomous, might have been a source of friction. For instance, the Board might have considered a certain price policy necessary to the success of its work, whereas the committee might have favored another. In fact, there was no friction for the same reason that the Board worked without friction between any of its departments, which was the cooperative attitude of the whole personnel. Consecrated to a common purpose, the members rose above personal ambitions and pride. THE CONTROL OF PRICES 171 In prices as in much else of its work the War Industries Board avoided the creation of rigid policies. Mr. Baruch always had the conception of industrial control as analogous to military strategy, and he consistently opposed the estab- lishment of policies that might hamper action in the face of an emergency. The Board never considered its acts in any case as precedents for others; it kept itself in a fluid state. There was necessarily, however, a general method of deal- ing with prices. Prices might have been dealt with in three ways, namely, leaving them to the open market — supply and demand; the establishment of a fixed rate of profit; and the setting of a fixed price. The first was obviously impossible if there was to be any eff'ective control of industry when the demand, being largely the imperative war demand of the Government and of the Allies, was not subject to reduction by a rise in prices, as is the case with demand in ordinary times. The adoption of that policy would simply have meant, in the circumstances, that the source of the demand that was sending prices upward, and would continue to do so, would have left price-fixing entirely to the sellers. It would have been to give governmental sanction to unmiti- gated profiteering. Even before there was any definite thought of price-fixing as a policy, the open-market plan was adopted when the peace-time policy of letting contracts by bids was suspended at the very beginning of the war. Thereafter Government purchases were chiefly through negotiated prices, which involved from the start an element of Government price- fixing, which became more and more important as the offices of the Council of National Defense, General Munitions Board, and War Industries Board were invoked. These bodies always exerted an influence on prices that tended to suspend the free operation of the law of supply and demand and that limited profits. They were not concerned, it is true, with getting the lowest possible prices; but with the establishment of prices that would stimulate production with- out being intolerable in amount. In some instances, as in shipbuilding, cantonments, air- craft, etc., the Government did adopt the policy of fixing prices by fixing profits, which was, under another name, the •* % ♦ ll «< r 1} i ' III ■■i 172 INDUSTRIAL AMERICA IN THE WORLD WAR cost-plus policy. With certain products it seemed to be the only feasible one; actual Government possession and oper- ation of manufacturing plants would have been only a form of cost-plus, because the owners of the plants would have been entitled to a compensation which would have to be deter- mined sooner or later. It was a policy with manifest defects. It involved the maintenance of enormous and costly accountancy systems by the Government in order to determine just what the cost of production was; endless disputes concerning the calculation of costs; a premium on inefiSciency, because the more efficient a producer was, the lower his costs and the less his abso- lute profits (although ingenious devices were adopted to counterbalance this tendency). To have applied it to all Government purchases would have called for an army of accountants almost as large as the army in France. The third policy, and the one followed by the War Indus- tries Board, was peculiarly susceptible of application to raw materials, which were the chief concern of that Board, because with them it was a comparatively easy matter to determine production costs in advance. Having obtained these for both high-cost and low-cost producers, the Board in conference with the producers fixed a price that would give a reasonably stimulative profit to the low-cost men. It was the business of the Board to stimulate production in all lines in which there was a shortage — not to haggle for the lowest possible price for a given order. A reasonable price was important, but volume production was the imperative consideration. It should not be inferred from this that the Board was reckless as to prices. There was a view that the Board did not need to be too careful of prices because the war and excess profits taxes would automatically return to the Treasury the major part of large profits. The Board did not share it, however, because it looked to the economic effects of extravagant prices and profits — mounting wages, high retail prices, labor unrest, credit inflation, etc. The Board did consider, though, that while prices that would insure a profit to four fifths or nine tenths of an industry — which seems to have been the bulk-line fractions it had in THE CONTROL OF PRICES 173 mind — would mean very large profits to the low-cost pro- ducers, a large portion of their profits would come back to the Government in taxes. It cannot be denied that the horizontal-price plan applied on the plane of high-cost production was a tremendous invigorator of big business and hard on small business. The large and efficient producers made larger profits than normally and many of the smaller concerns fell below their customary returns. On the other hand, if prices had been fixed on the plane of low-cost production, many, if not all, of the smaller concerns would have been driven out of Government business, which meant for a time at least from all business, with a resultant loss of their potential pro- duction and the withdrawal of the premium on maximum production from the large producers. In view of the general dissatisfaction that was expressed with the cost-plus system, few would have the hardihood to say now that it should have been adopted generally. The level-price plan accorded admirably with the general policy of the Board — of getting results instead of concerning itself with the details of methods. Industry was left to its own management and devices in extending itself to the maximum and was not hampered with a swarm of critical supervisors and accountants. In this way the genius of American busi- ness was not cramped, but utilized to the fullest extent for the purposes of war. The discussion concerning the basis of fixed prices was long and of absorbing interest. Professor Taussig, a member of the Price-Fixing Committee, presented the argument for a uniform price as follows: 1. If diflferences in cost of production between different pro- ducers were — (a) Clearly ascertainable; (b) Due solely to differences in the natural resources utilized by them; it would not be impracticable to purchase from them at pricesi based on their differing costs. As a matter of fact, neither of these conditions is ever present. In the first place, costs are not clearly ascertainable. They vary from month to month, from year to year. We get figures from cost accountants which are worked out to the last cent, but which, ;{.: 174 INDUSTRIAL AMERICA IN THE WORLD WAR THE CONTROL OF PRICES 175 iX I' it lit ii If I ^l» h as a matter of fact, contain arbitrary and debatable elements. Any endeavor to pay to each producer according to his costs would lead to perpetual wrangling, perpetual requests for changes and modi- fications. In the second place, differences in cost are by no means due solely to differences in natural resources. They arise very largely from differences in skill, energy, efl&ciency. To pay a low price to a producer who has brought down his costs through skill and ability is to penalize the most effective form of human effort. 2. Sale at varying prices is in any case not practicable. If the Government fixes a price, it must be a price uniform for all producers. Were this not the case, there would be constant squabbling and intriguing for favored position. 3. The main problem is that of purchase, and I am unable to see the practicability, as conditions of production stand to-day, of carrying out a policy of purchase at varying prices. The only possible way of carrying it out would be for the Government to take over all the establishments and try to run them. Quite apart from the constitutional questions involved (as regards the fair price which the Government must pay for each plant) the actual admin- istration and running of an enormous variety of plants would be a hopeless task. 4. The only feasible plan in price-fixing is that of establishing a uniform price, which should ordinarily be paid for the whole of the output. The uniform price which the Government thus must fix is not necessarily the cost-of-production price. It need not be either an average cost-of-production price or a marginal or "bulk-line" cost. The Government might be expected under ordinary conditions to pay the market price that would obtain in the absence of regulation, irrespective of cost. Under conditions of war stress and war exigency, however, the Government must pay for an essential commodity that price which will maintain and, if possible, stimu- late the volume of production. Such a stimulating price is not far from the marginal or "bulk-line" cost. There will always be sporadic producers having very high costs, higher than the "bulk-line," who may be disregarded. It is con- ceivable that in extreme need for a particular commodity the Government will make some special bargain with the small number of high-cost producers. But such transactions are. extremely dubious and are to be avoided except in the extremest urgency. As regards them, it must be made out that the very high cost of the producers is not due to slackness or inefficiency on their part, but to poor natural resources, and that the payment is indispensable for the maintenance of a supply absolutely needed. At the same time the fixed price stimulated efficiency and consequently production, because the larger the volume of production in proportion to cost, the larger the profit, even after making allowance for taxes. It does not appear that there was any customary per- centage of profit estimated. The whole price-fixing theory was based upon the fact that the price must be put at the lowest possible figure at which we could obtain all the things that were needed for the prosecution of the war. The earlier policy of the Board as a price-fixing medium was also the policy of the Price-Fixing Committee. Time and again Chairman Brookings made it plain that his com- mittee had no rigid policy beyond that of making the costs of the less eflficient section of an industry the basis of the price for all. Here it must be remembered that the Board primarily dealt only with materials in which there was a shortage and in which, therefore, production must be increased. Unlike the Food and Fuel Administrations, the War Industries Board was not fundamentally concerned with retail prices. The course of events was turning it in that direction as the war approached its end, but its chief purpose was to secure the materials the Government or the war industries needed at a price that would stimulate production without being excessive. However, the Board did always provide that the raw materials prices obtained for the Government should also be enjoyed by the public and the Allies. Thus, the original producers could not practice extortion on the public, but the secondary producers — the makers of finished goods — were not so restrained. When retail prices began to get so high as to react on production, through disturbance of the public mind, the unsettling of wage scales and concomitant industrial disturbances, they did become the concern of the Board, and only the early termination of hostilities pre- vented a regime of price-fixing for the protection of the ultimate consumer, comparable to that of the Food and Fuel Administrations, but probably on a fixed-maximum- price basis instead of on the basis of regulation of profits. The War Industries Board's conception of price-control leaned toward stabilization as the chief consideration. This at 176 INDUSTRIAL AMERICA IN THE WORLD WAR it obtained in the completely controlled industries through price-fixing and in the partly controlled through the applica- tion of the principle of 'priority. "War prices were high prices," writes Mr. Baruch in his preliminary report on the work of the Board, "but they were stabilized prices. The most effective organ of stabilization was the operation of the priorities system." Priority took away from the market the element of price-determination that arises from knowledge of insufficient supply of raw materials; price- making deprived the market of the element that proceeds from the desire for inordinate profits. Quite aside from the matter of profiteering, unnecessary burden on the taxpayers, and social justice, the War Industries Board sought stabilization as a sine qua non of maximum production. Production to it was as ammunition to the soldier. At the risk of unnecessary repetition, it is essential to state that the War Industries Board was the civilian complement of the armed forces of the Nation. Its business was the basic procurement of the goods needed for war consumption; not to safeguard the civilian against want and extortion as were the Food and Fuel Administrations in large degree. When it acted to protect production for the public, as it did at times — and was coming more and more to do — it was still with its eye on the objective of pro- duction. It took care not to kill the goose of the golden eggs whilst stimulating the output of eggs; but the goose was conserved, not for her own sake, but for that of the eggs. As the Shipping Board's incessant clamor was for ships and more ships, the War Industries Board's insistent urge was for production, production, production. This may seem somewhat cold-blooded, but it was not; it was simply fidelity to function. A general will save all the lives he can; but however humane he may be, and as such gratified by a small casualty list, he is sparing of his men in his capacity as a general only that he may have more to spend at another time. In this making of the Government price the common price the Board was moved by both sentiment and sense. It was obviously not the fair thing to leave producers free to squeeze the public to make up for any slendemess of THE CONTROL OF PRICES 177 profits under Government contracts, and it was not in accordance with the ethics of partnership to allow the Allies to be assailed by excessive prices behind the lines while we were fighting for and with them at the front. The Allies were spending in this country money loaned to them by the National Treasury; the higher the prices exacted of them, the greater the loans, and the greater the ultimate burden of the American people. Price-fixing by the War Industries Board was not an arbitrarily proclaimed or abruptly determined process. It always took the form of negotiation, and the results were, strictly speaking, agreed rather than decreed prices. It is true that in some instances the Board had to show its teeth and force fair prices by threats of commandeering,^ but the method of approach was always one of mutual consideration. On the historic occasion when the sixty-five delegates of the steel industry met the Board in full session to determine steel prices. Judge Elbert H. Gary, speaking for his asso- ciates, solemnly inquired of Judge Lovett, of the Board, as a lawyer: "May I ask by what authority the War Industries Board has undertaken to fix these prices?" "A gentleman of your eminent qualifications in law," was Judge Lovett's answer, after a moment of profound silence, "requires no information from me on that point." And with a grim smile all around, the Board and the delegation proceeded to fight it out. It was no parlor debate, either. The Board was armed with facts and figures about steel and iron production and costs, not only from the exhaustive investigations of the Federal Trade Commission, but from the inside information of Replogle and other steel men who were now playing the Government's game. In lumber and other commodities as well there were some very tense sessions in connection with price-fixing, but the war service committees and other representatives of industry had the satisfaction that every good fighter has in meeting a f oeman worthy of his steel. On the foundation of its com- modity sections and divisions, the War Industries Board ^Commandeering was actually resorted to by the army and navy in many cases. The army alone issued 510 requisitions for goods and 996 compulsory orders for production of goods. h^ ) 1^ I / :l/ i i ,> ' 178 INDUSTRIAL AMERICA IN THE WORLD WAR built up a skillfully used knowledge of everything it under- took to do. Business men used to complain of "professors" in other Government agencies, but in the War Industries Board they dealt with their own kind. The fidelity of the transplanted business man to the Government was remark- able and stirring. He played the game just as strenuously and remorselessly for the Government as he would have played it on the other side. It is a singular fact, too, that the very men on that other side were sometimes furious at their brethren in the Government's service for doing pre- cisely what they would have done had they been on that side. When a price for any commodity had been determined by the War Industries Board, it did not follow that Govern- ment purchasing agencies were not free to obtain better prices if they chose to; the Board price was always a maximum price. In general, though, it was accepted as the established price, and that part of contract-making did not bother the buyers any more. Occasionally a price was fixed only for a limited purpose or for one department, and some- times for the benefit of the Government or for the Allies only; but in general a price once made was a price for all. Note that prices were fixed every three months, to insure fair play to producers and justice for the general public At all times the Price-Fixing Committee was open to com plaints or suggestions from Federal departments, the public and Congress. This seems to have been forgotten, particu larly by a few Congressmen who complained after the event The creative and research work of the Price-Fixing Com mittee was vastly simplified, not only by its intimate relations with other parts of the War Industries Board — particularly the commodity sections — but by the assistance of the Federal Trade Commission. This imposed a heavy burden on the Commission and made it in large measure an adjunct of the War Industries Board. Some five or six hun- dred persons were employed by the Commission in its work of investigating costs as related to the war effort. The administration of fixed prices was left to the com- modity sections of the Board, which also, it should be noted, were constantly tied in to the process of price-making. The details of aligning the prices of particular products in THE CONTROL OF PRICES 179 accordance with basic prices were usually left to the industrial associations or war service committees as a matter of trade routine based on accepted differentials. In the beginning important legal aspects presented them- selves. Excellent authorities held that, in contemplating fair prices to producers, the prices prevailing before we entered the war would have to be considered. In some cases these were one hundred per cent higher than those finally paid. The prices finally agreed upon were voluntarily arrived at and the mounting legal aspect thus eliminated. The Govern- ment consequently avoided the higher prices that legal action might well have caused. The general results of the price-fixing work of the War Industries Board were satisfactory. Together with the price-controlling of the Food and Fuel Administrations they did effectually check the runaway market of the summer and fall of 1917, and kept prices under restraint until control was released. It has been pointed out that because the War Industries Board (with the notable exception of cotton) confined its price-controls to raw materials, there was a wide opportunity for profiteering in prices to the final consumer. This opportunity was undoubtedly used, too, but price records show a gratifying response on the whole of prices of finished products to those of raw materials. It was in the final step from the retailer to the private con- sumer that there was the greatest departure from proportion. The Government and the Allies, as buyers, got the benefit all along the line from the stabilization of original pro- ducers' prices. Had it not been for the primary control, however, with its rationalizing and steadying influence, retail prices would certainly have been much more erratic and probably on a far higher average plane than they were. The departure from the rule in the case of cotton, a most important raw material and the only one of the great raw materials that was not priced at the source, has been the occasion of much controversy. To fix the price of cotton meant dealing with millions of producers — the cotton farmers — which was an undertaking foreign to the Board's habit of establishing prices quietly through conferences with a few men who were able to speak for industrial groups. 1 1 f I ij 180 INDUSTRIAL AMERICA IN THE WORLD WAR I u ^1 It would not have been a matter of the council room, but of debate in the national forum. Congress had fixed prices for all wheat produced, but had not touched com and had refused to deal with cotton prices. It was a question whether the Board had justification for entering a field that had thus been preempted by Congress, though President Wilson stood ready to support it. Finally, though there was at times a shortage of the better grades of cotton, there was never a general shortage, which fact left raw cotton outside the Board's defined field. It is true that exhaustive consideration was given to the question of stabil- izing the price for raw cotton and that price-fixing at the source was considered. A special committee appointed to consider the raw-cotton problem advised against price-fixing, as being unnecessary and capable of application only by Government purchase of the entire crop. As an administrative machine the War Industries Board's practice of dealing with prices at the source had the great advantage of simplicity. There was no necessity for an enormous policing and administrative force to watch and supervise hundreds of thousands of establishments. The few thousands of industries located at the source of the controlled materials were so grouped together by association or committees that they effectually policed themselves, and their operations were so conspicuous that any glaring evasion or violation of regulations for any length of time was impossible. The whole personnel of the War Industries Board at its height did not exceed fifteen hundred persons. Yet, with this small force, order, reason, and restraint were introduced into purchases for the Government and the Allies that aggregated thirty billions of dollars in value and that ramified throughout the teeming industrial life of America, touched the business life of the whole neutral world, and even of the Allies themselves, and imbued the huge economic mechanism of America with potent eflSciency. 1 1 i CHAPTER X BALANCING SUPPLY AND DEMAND The twilight zone between essential and non-essential industries — Looking beyond the war — Jewelry and automobiles — An industrial operating clinic — What happened to the building trade — Baruch writes Mayor Hylan — Politics adjourned — Rifles, artillery, gun mounts — Ferreting out hoarded goods — Housing fifty army divisions — The Board and the railways — Break- ing a great transportation jam — The searchlight of statistics — The War Trade Board ties in — The legal factor. A SIMPLE analysis of the elementary functions of the War Industries Board would be to say that they consisted of the stimulation of production and the conservation of products. We have seen in previous chapters how the task was outlined through the study of requirements and resources, and how it was attacked through the two implements of priority and price-fixing, both of which were primarily used for obtain- ing increased production of the things that were essential to the successful conduct of the war and the maintenance of the sanity and vigor of the people. In the judgment of the writer the principle of priority in the broadest sense was the underlying principle of all the work of the Board except that of price-fixing. We are not speaking now merely of the Board's Priorities Division, but of the principle of priority — the ordering of the fulfillment of requirements to correspond with the volume of supply or resources. To meet the demands of priority, it was necessary to take direct administrative measures to increase production and restrict use. The organic functional units through which these ends were attained were the Conservation Division and certain other restrictive instrumentalities, on the one hand, and certain agencies for the expansion of supply, on the other hand. These last, as already noted in Chapter VIII, included the Resources and Conversion Section, the Facili- ties Division, the Advisory Committee on Plants and Munitions, and the Division of Planning and Statistics. The two first-named agencies were placed administratively in the r I' ~r\\ 1 I 1 u ^i :i \tH * { II 182 INDUSTRIAL AMERICA IN THE WORLD WAR Division of Finished Products under the Commissioner of Finished Products, the third was placed under Mr. Alexander Legge, and the fourth was independent, reporting directly to the chairman, but being intimately associated with the Conservation Division. Actually, there were other functional agencies that were specifically created to increase production, conserve pro- ducts, or curtail consumption. One of these was the Non- War Construction Section which was placed directly under the Priorities Commission, as was another, the Industrial Adjustments Committee. Another was the Fire Prevention Section in Mr. Peek's administrative division; still another was the Stored Materials Section imder Mr. Legge ; and also the Inland TraflSc and Emergency Construction Sections of Mr. Legge's administrative sector of the Board. Some of the so-called commodity sections had such specialized functions in relation to the stimulation of production in general as to be more properly classed with the agencies just mentioned than as media of contact with particular industries. Of course, it is not to be forgotten that the com- modity sections were almost always the point of direct appli- cation of the functional activities under whatever adminis- trative divisions or whatever guise. Quite outside of the administrative authority of the Board was the augmentation of supply through the expansion of imports and the restriction of exports through the cooperation of the War Trade Board. It is the purpose of this chapter to deal with these special instrumentalities of balancing supply and demand except the Conservation and Resources and Plants Divisions, each of which will require a separate chapter. The application of the principle of priority with all its corollaries quickly raised the sore question of non-essential industries. It was apparent that, under the preferential system of access to materials and facilities, some of the industries not engaged in actual production of commodities for war utilization would be restricted to the vanishing point. But beyond the inevitable evolution in that direction there was an insistent demand for the arbitrary excision of "non- essential" industries at a single operation. BALANCING SUPPLY AND DEMAND 183 Viewing, on the one hand, the need of men for the armies, and of equipment for them in its myriad forms which made demands upon the productive capacity of the country that in some lines were more than equal to the annual output, and, on the other hand, a host of luxurious or decorative industries which were holding men and consuming materials, there was an impulsive demand of great intensity and determination for the virtual scrapping of many industries. With this extreme view the War Industries Board did not agree. It was prepared to strip the fighting Nation to the waist, and was willing to decree the suspension or even the ruin of any industry if that were the price of victory, but it saw that there was no dividing line between essential and non-essential industries — only a twilight zone that reached at points to the other sides of the main zones. The Board was not prepared to single out the sheep from the goats by an omnibus proscription. It preferred to leave the elimination to a process of natural selection through the progressive operation of priority. It perceived that the morale of the people was deeply involved, and it saw that psychological reactions cannot be easily foretold. It saw also that to extin- guish an industry, even if its product were a patent super- fluity, was to cripple the industrial body, which had to be kept sound and strong, even if lean and stringy, unless the facilities and persons involved could be immediately applied to other tasks that would keep them in the industrial fabric. Then, too, beyond the moment was the question of the future. All wars come to an end, and it is desirable to have something left of what was worth fighting for. The victors in some wars have been the victims of the following peace. The doughboys would not have gone very cheerfully to the front if they had thought that they were to return to an impoverished and disorganized homeland. Certainly there was no occasion for a dramatic sacrificial gesture that would mean the sweeping away of scores of industries, the disem- ployment of hundreds of thousands, widespread bitterness, and impairment of the will to war, as was urged by the extreme "forgodsakers," to whom every soda foimtain, ice- cream parlor, jewelry shop, candy store, automobile pleasure car agency, theater, movie-house, pie bakery, etc., was an ofi*ense. r ••I Ji 9¥ ft i 1 i 184 INDUSTRIAL AMERICA IN THE WORLD WAR Nevertheless, there came a time when some industries, even highly useful and fundamental ones, if they happened to deal with its deferrable needs, had to face virtual sus- pension. They were left, it is true, with skeletons on which the flesh of activity might be regrown, but they were very ghastly skeletons in the eyes of the proprietors. In the great majority of cases the application of the policy of con- version found places for plants and personnel in work that could not be deferred. In scarcely a case was any industry except that of alcoholic beverages^ branded as non-essential, and that was the work of Congress, though the Board had caused the largest whiskey distilleries to be converted to the manufacture of alcohol for utilization in making smokeless powder. The War Industries Board rather inclined to the view that in the true perspective there were no non-essential industries, only many grades of relative immediate utility. The crusade against non-essential industries became so insistent, and so many people felt that the tapering-off policy of the War Industries Board was so unheroic and even timid in view of the universal tragedy of the war, that President Wilson designated the chairmen of the War Trade Board and of the War Industries Board and the Food and Fuel Administrators to consider and decide what, if any, indus- tries were non-essential and should be sacrificed in order to stimulate indispensable production by the diversion to it of labor and materials. This committee appointed a working committee, composed of Clarence M. WooUey, of the War Trade Board, as chairman; Edwin B. Parker, Priorities Com- missioner; T. F. Marsh, of the Food Administration; Edwin F. Gay, of the Shipping Board; P. B. Noyes, of the Fuel Administration; Felix Frankfurter, chairman of the War Labor Policies Board; and George May, of the Treasury Department. This second committee finally reported to the President that in its opinion no industry should be prohibited or destroyed, and that, instead, there should be a general curtailment plan that would do away with the conflict between *The suspension of the manufacture of intoxicants was by an act of Congress, but before the national legislature had decreed full war-time prohibition the committee of investigation had recommended that the brewing industry, which was still legal, should be curtailed to fifty per cent of its normal barrelage, the committee holding that summary prohibition by administrative action would have an untoward effect. BALANCING SUPPLY AND DEMAND 185 war and non-war industries in the matters of materials, labor, fuel, and transportation. Out of the long list of American industries, the committee reported that "a searching analysis revealed only twenty-five classes as purely non-war industries and therefore worthy of consideration for complete prohibition." The capital invested in these industries was $733,000,000, the number of em- ployees 283,518, and the annual fuel consumption 1,701,000 tons. In part the committee's inescapable conclusion was as follows: Contrasting the degree of relief afforded with the hardships necessarily imposed upon a part of the community, your commit- tee has reached the conclusion that it would be inadvisable to adopt direct industrial prohibition to accomplish the desired end. It would not only result in inequalities and thus engender intense dis- satisfaction on the part of those affected, but it would also create grave apprehension throughout the entire industrial community. This might weaken the morale of the Nation and, in the final analysis, cause actual harm rather than positive benefit. We also invite your attention to the fact that a sudden disloca- tion through complete prohibition of any industry involves the disintegration of entire organizations, including the workers, fore- men, superintendents, and managers. Such organizations in most cases are the cumulative result of many years of constructive effort, and it is obvious that with the ending of the war the prohibited industries would be obliged to go through the pioneer process of re-creation. This would, in the opinion of your committee, augment the embarrassment of post-war industrial readjustments. The sub-committee which made the report on non-essential industries, and found, in effect, that there were none, was constituted a permanent body as the Industrial Adjustment Committee of the Priorities Board, with Rhodes S. Baker, Assistant Priorities Commissioner, as its executive officer. This committee gave constant consideration to forecasting the efi'ects of the extension of the rule of priority. As each additional industry was found to be a proper subject of curtailment, ample advance notice of the Priority Division's plan was given to its members, and they were accorded the fullest opportunity to oppose the curtailment programme or to cooperate in its determination. The basic policy of the ft I 1 I! i i |H 186 INDUSTRIAL AMERICA IN THE WORLD WAR committee was to outlaw no industry as non-essential and to seek to leave enough of each so that its resumption of activity at the end of the war would be expansion instead of recon- struction. At the same time the curtailment process released men and materials for the currently indispensable industries so gradually that there was no shock to the economic body. The committee's report threw light on some of the un- toward results that would have followed the adoption of the view of the absolute non-essentiality of certain industries. Offhand, one of the most palpably non-essential industries in war-time is the manufacture of jewelry. But certain cities actually live on that industry. Would it be promoting the winning of the war to wipe the city of Attleboro off the industrial map and make its inhabitants a public charge? Moreover, jewelry as an article of export had an important bearing in balancing exports and imports and in maintaining exchange at a parity, at a time when exports were of great importance as a means of obtaining necessary imports. A nation must live if it is to fight, and in the economic, as in the human, body there are obscure and seemingly superfluous organs, the removal of which upsets the whole of the bodily processes. The committee might have added that the prevalence of some luxuries is the surest incentive to labor. Many an alien laborer did good service in the war — not from patriotism, but because of the lure of diamonds, silk shirts, and phono- graphs. Ice-cream and candy look like dispensable luxuries when men are dying for lack of shell steel, but the driven worker in the roaring bays of factories is but human, and even in war-time he cannot be a Jack-of-all-work-and-no-play. The Industrial Adjustment Committee had a stormy career. It was essentially a trouble committee. Around it raged the storms of torn and shorn business, shot through with lightning flashes of selfish anger and dark with apprehension and mis- givings. To it came American business as a fearful patient to the operating-room. One of the most difficult of its patients was the passenger automobile business, which was finally cut down to a twenty-five per cent basis, but that is chiefly a story of steel and iron curtailment and will be told in the chapter on those commodities. BALANCING SUPPLY AND DEMAND 187 The most heroic operation was performed on the building industry. Priorities Circular No. 21 was all but a death- blow for it. It, as supplemented, decreed that except by special permit no new non-war building construction should be undertaken involving an expenditure of more than five hundred dollars and no extensions costing over twenty-five hundred dollars. The administration of this Draconian ordi- nance was entrusted to a Non-War Construction Section, under the Priorities Commissioner, headed by Mr. D. R. McLennan. Circular No. 21 was a painful and staggering blow, not only to the building trades, but to all the industries from which they drew their materials. It fell upon the plumbers, the carpenters, the steam-fitters, the lumber manufacturers, the cement men, the furniture makers, and numberless other industries. And it made trouble for every citizen who wished to build or enlarge a home or a business structure. It was a hard blow, and the reaction was instantaneous and indignant. It came from all parts of the country and from every rank of life. It rolled up to Washington in a cyclonic storm of protest to the War Industries Board and to Congress. It was a fierce storm, but it was resisted with patience and ingenuity. In an inspired moment it had been suggested that the Non- War Construction Section operate through the State Councils of Defense and their local bodies. The writer so warmly approved of this course that as director of the Council of National Defense and as the active head of the Council's great Field Division that guided and coordinated the work of the 184,000 units of the State and local councils of defense, he agreed to the Board's establishing direct contact with the State bodies. To avoid overlapping war eff'ort in the States, this had not been done before. Here, however, the short cut was imperative. To get a building permit from the Section the would-be builder had to have his project approved by his fellow townsmen before his application could be considered at Washington. Those fellow townsmen had sons and brothers in the trenches or on their way to them. It had to be a very necessitous enterprise that would persuade them to divert labor and materials that might be used directly to help the fighting line. They did M u >• u I III! 188 INDUSTRIAL AMERICA IN THE WORLD WAR their duty without fear or favor, these local Councils of Defense, and the would-be builders had to make their fight at Washington. The Priorities Commissioner and the War Industries Board were in a state of siege, but they stood firm and defended themselves before the high court of Congress when a Senate resolution, introduced by Senator Calder, of New York, called upon the Board to explain why a four-billion dollar industry, "than which it seems to me there can be few more essential," should be condemned to quiescence. Chairman Baruch's answer pointed out that, as against a semi-annual war demand of twenty-one million tons of iron and steel, the product was but seventeen million tons; that in the face of a shortage of fuel for carrying out the war programme the production of building materials was consuming thirty mil- lion tons of coal, and that twenty-five per cent of the railway transportation capacity of the country was being utilized by building materials, and that, with not enough war labor, large numbers of men were employed in private building operations. "It is not only the policy," the answer concluded, "but the clear and simple duty of the War Industries Board to see that the war programme of the country is met, and this programme must be met now, when the needs are upon us. This duty must be fulfilled, even if its fulfillment entails industrial loss in this country as it does human loss abroad." With this answer the general storm passed, but there were numerous local cyclones to deal with. The churches and the schools and the like were used as the first line of attack. Chicago clamored for a huge temporary memorial building to the soldiers; "Billy" Sunday, the evangelist, wanted per- mits for great temporary tabernacles; New York City insisted on an $8,000,000 school building project; and so on. Chi- cago finally withdrew its application, Sunday, after he was told of the need, telegraphed that he would "gladly comply," and Mayor Hylan, of New York, had to endure an unyielding "no" to his appeal to Mr. Baruch. In the last-named instance strong political pressure was brought to bear on the chairman, the line of this appeal being that he was a Democrat, and should help the party in New York City by making it possible X • BALANCING SUPPLY AND DEMAND 189 for Mayor Hylan to keep his preelection pledge of more and better schools in that city. Apropos, the writer — merely to confirm what he already knew — has made it a point to inquire of most of the princi- pal executives of the War Industries Board as to what, if any, influence partisan politics had on the administration of the Board. The replies have invariably taken the form of a categorical and emphatic negative and have usually pointed to the fact that the personnel of the Board was overwhelm- ingly Republican. It has not been possible to find the faintest trace of a single appointment being based on anything else than presumed fitness for the task. As a matter of fact, most of the Board men were so little concerned with politics that they did not ask each other's partisan affiliations. Just after the war, however, at a dinner attended by these execu- tives, a poll was taken, and it was found that of those present there was only one Democrat — Mr. Baruch. The political government of America remained of one party throughout the war, but the industrial government — for that is what the War Industries Board really was — was entirely non-political. No formal decree by Congress of an industrial coalition gov- ernment could have realized anything like the non-political- ism of the industrial control of the Nation that characterized the War Industries Board. It might be inferred, from what has been said about the storm aroused by the restriction of the building industry, that it was a peculiarly selfish business group. Such is far from being the case. The reaction to restriction was simply in proportion to the blow — the most sweeping that was dealt to any great industry during the war — a blow of thousands of reflexes which struck sturdy American individualism in every section of the country. The farmer who wished to build a new bam and the industrialist who was planning a new plant were alike hit and hit hard. Naturally they were angry at first. However, as Mr. Baruch showed in his letter to the Senate, the trade had been consulted in advance through many of its most representative men, and had acquiesced in the decree — so that it had the advantage of cooperative support. The protests were largely from those who would build ^ 4 I t 190 INDUSTRIAL AMERICA IN THE WORLD WAR rather than from the builders themselves. Despite the fact that for a time more than half the War Industries Board's mail related to the work of the Non-War Construction Section and that countless delegations and individuals made pil- grimages of protest to Washington, it is authoritatively stated that only one personal protestant refused to approve the course of the War Industries Board after the subject had been canvassed with him. A superb illustration of what a ration- ally plastic human material the leaders of America have to work with! If American democracy had borne no other fruit than this plasticity which arises from the deep-lying devotion to the common good of a people who share in the common control, it would have been vindicated by this fine fruit alone. "I tell you," said Samuel M. Vauclain, the great loco- motive manufacturer, to the writer in talking of his experi- ence in the War Industries Board, "you will go a hell of a long way before you will find men like our Americans and the way they worked together in Washington. There was no other government that had such a crowd. You can talk about Baker, about Daniels, about President Wilson ; but the people who won this war and the people who managed this war and who were responsible for the results are the common people you see walking around here and everywhere." Out of many thousands of instances of reasonableness in the face of great personal disappointment, take the case of an influential Democratic member of Congress from New York. He had purchased a new home, which he was enlarg- ing to meet the requirements of a numerous family, and it had already been partly dismantled. Ordinarily in such a case a permit would have been granted, but in this instance the application was denied because the applicant was a Congressman! It was explained to him that many houses, schools, and hospitals in his vicinity had been held up, and that it would make a bad impression if a Congressman were able to build when others could not. The legislator admitted the force of the argument without a moment's hesitation and withdrew his application. The Non-War Construction Section, though firm in fidelity to its functions of restricting some forms of production, that BALANCING SUPPLY AND DEMAND 191 others more immediately necessary might be stimulated, was never arbitrary in manner or method. It kept the general result rather than the particular in mind and permitted the continuation of such building operations as were in line with the broad policy of not upsetting the industrial fabric just for the dramatics of the thing or for merely disciplinary reasons. It was one of the greatest factors in balancing war demand with war supply by means of curtailment on the one hand in order to efi'ect expansion on the other. The Advisory Committee on Plants and Munitions was a survival of the old Council of Defense Munitions Standards Board, which had a committee on production that persisted through the different phases of the War Industries Board, and in the reorganization in the spring of 1918 was named as above. The evolution of the Board restricted the commit- tee's functions somewhat, but it remained throughout a power- ful stimulator of production, especially in locomotives and ordnance. At its head was Samuel Vauclain, president of the Baldwin Locomotive Works of Philadelphia, the other members being Captain J. C. Rockwell, J. M. Hanson, Henry R. Rea, Frank W. Morse, Admiral A. R. Couden, and G. M. Shaw. It will be something of a surprise to those who recall the wholesale denunciation of General Crozier and others for the decision to alter the British Enfield rifle to take American Springfield cartridges and standardize its parts, as an unpar- donable delay when some of the new divisions were drilling with broomsticks, to learn that this decision had the whole- hearted approval of such practical men as Mr. Vauclain and his associates. The decision, he testifies, resulted in a great increase of production. Mr. Vauclain, although he had been manufacturing the British rifle for the British Government, declares that it would have been "a crime to have made it and given it to our boys to use." The remodeled Enfield, standardized and using the same ammunition as the Springfield, could be put together in one minute and forty seconds; and eight thousand were turned out in a single day. The plants making the British rifle changed their tools so rapidly, as the alterations in design were made, that quantity production began the day If< I II ? '.h 'i ' ; I 192 INDUSTRIAL AMERICA IN THE WORLD WAR after the last alteration. So great were the production advantages of standardization that the United States within ten months was turning out service rifles twice as fast as Great Britain. In a single week fifty-one thousand rifles were made of both the Springfield and Enfield types. In no other part of their equipment were the American soldiers so liberally and excellently supplied as in service rifles. What was denounced at the time as a colossal blunder of judgment on the part of Secretary Baker and the War Depart- ment was in fact one of the soundest things done in the whole war. Public criticism is the best safeguard of government, but it sometimes makes costly errors. The Vauclain committee also sustained the army in its adoption of French artillery designs, instead of taking over the production of plants which were making guns for the British. "If they had not adopted the French guns, they would have had nothing," says Mr. Vauclain, who is of the firm opinion that both French guns and projectiles were better than the British. And yet it must be recorded that, owing to the tardiness of production of the French type of guns, the War Department was compelled to contract, in October, 1918, for a considerable quantity of English artil- lery to be made in England that it could have had in 1917 from American plants that had been producing the British guns and that could have swung immediately to the produc- tion of them for the American army. In the long view, the adoption of French types was sound, but, considering that British types were in production in America when we entered the war, they should have been used to the utmost at first. This book is not a history of munitions manufacture, and much of the work of the Advisory Committee on Munitions and Plants was of a highly technical nature. It had certain routine duties to attend to, such as the compilation of muni- tions production reports and the like, but its most brilliant and appealing work was in its use of the personal equation. It rallied men and plants through the personal appeal for feverish jobs in the making of locomotives, rifles, artillery, f orgings, shafting for destroyers, gun carriages, shells, and ammunition in general. American manufacturers were reluc- tant and slow to drop other business and take up the making BALANCING SUPPLY AND DEMAND 193 of munitions of which they knew nothing from experience, and there was a general aversion to "Government business" as being unprofitable and vexatious. Mr. Vauclain and his assistants were among the cheer leaders who rushed them to the job. "Look here," said Vauclain to Baldwin, of the Otis Ele- vator Company, "the time has arrived for every red-blooded American manufacturer to take off his business coat and get to work manufacturing military goods. We can do without elevators. You cannot get any wire rope for them, anyway. Put your brains and the brains of your staff' on this gun- carriage business!" "Vauclain, the business coat is off," was Baldwin's prompt answer as he threw his coat on the back of a chair; "now, what do you want me to do?" "Make 244 mm. recuperators." Baldwin did not know a recuperator from a cartridge, but he made them. The navy wanted railway mounts for the fourteen-inch guns that were intended to snuff out the "Big Bertha" that was shelling Paris at a ninety-mile range. It furnished the designs and called for bids. Nobody could make them under nine months. Vauclain said he could have them built in four months; he had them on the way in three. One factor in this success was the perfection of the drawings furnished by the navy. Vauclain's method was entirely the personal method, and he sometimes collided with policies of his own organization — the War Industries Board. An amusing incident arose therefrom in connection with the making of the naval four- teen-inch gun mounts. They were building before the priority order came through and Vauclain applied for priority for sixteen similar jobs for the army. He encountered the army and navy priority representatives in a heated wrangle. The army man was opposing, as he supposed, priority for the naval gun carriages. "What in hell is the use of talking about what's done?" exclaimed Vauclain. "I want priority now for those army guns." This was quite a horse of another color to the army man and Vauclain got his priority. '. 1 '\ « , I i K'! i\' ;| 194 INDUSTRIAL AMERICA IN THE WORLD WAR Before the creation of the Railroad Administration, the Advisory Committee was specially charged with locomotive and car production, and had much to do with the facilitation of production through the standardization of different types of locomotives. In this, as in hundreds of other matters relating to the practical side of production, the Advisory Committee on Plants and Munitions was the constant coun- sellor and adviser of the War and Navy Departments. Under its direction and through its knowledge of men and plants there went on a vast conversion of industries from imple- ments of peace to weapons of war. Another special task was the procuring and forwarding of supplies for the Czecho-Slovak army which was just then completing its eclipse of the march of Xenophon's Ten Thou- sand by fighting its way across Russia and Siberia to Vladi- vostok. Just as the war ended, the chairman of the commit- tee was starting for France at the request of General C. C. Williams, Chief of Ordnance, to take charge of the big tank assembling plant at Chateauroux. The Fire Prevention Section, of which W. H. Merrill was chief, was established in April, 1918, in order to conserve products and production through precautions to guard against destructive fires, many of which had already occasioned serious losses. This section inspected and made fire-preven- tion recommendations for all plants having more than a hundred thousand dollars worth of Government orders. Mr. Merrill was assisted by Frank E. Pierce, W. E. Mallalieu] George W. Booth, and Charles H. Smith. As the war went on, it became increasingly apparent that a very important volume of necessary materials and goods was being hoarded or stored by speculators, held on foreign account, concealed by pro-Germans, or in other ways kept from consumption. Accordingly a Stored Materials Section was formed in December, 1917, with John F. Wilkins as chief, with the function of locating, unearthing, and inven- torying all such stores. In prosecuting its work this section was of great incidental help to the War Trade Board, by informing it of goods intended for foreign consignees on the enemy-trading list; to the Alien Property Custodian, by giving information about enemy-owned goods; and to the BALANCING SUPPLY AND DEMAND 195 transportation agencies by its information in regard to con- gestion of goods in warehouses, on docks, and in railway terminals. Later this section took up the operation of a plan devised by the Conservation Division for an interdepartmental clearing-house to bring into use the surpluses or inactive materials that the various departments had accumulated, through change of programme, overcalculation, etc. The navy, for instance, might be in need of materials or goods of which the army had a burdensome excess, and vice versa. The chief sources of information of the section were the various governmental intelligence services, the insurance companies, the banks (through their collateral loans on stored materials), voluntary individual information, and systematic inventories of stores in certain warehouses. The insurance companies were loath to open up their private records at first, holding that they were sacredly confidential, but eventually means were found to persuade them to cooper- ate cordially, and voluminous information thus came to light. A single insurance company report, for instance, disclosed one hundred thousand pounds of copper just at a juncture when it was a Godsend for the navy. The section turned its data over to Alexander Legge as chief of the Requirements Division, who disposed of it according to war needs; and the various purchasing agencies of the Government were also notified, as well as the chiefs of commodity sections of the Board. At a rough estimate the section uncovered a billion dollars worth of goods concealed purposely or by accident. Its revelations were in the nature of a surprise package. When every other source was exhausted, an agency with unsatisfied requirements would reach into the Wilkins grab-bag. On one occasion it yielded the army one hundred thousand kegs of wire nails when nails were scarcer than practical men in Soviet Russia. Speaking of Russia, the Stores Section located an immense amount of supplies destined for the Kerensky Government, but held up on its downfall. They consisted of woodworking machinery, agricultural, railroad and wagon- road equipment, projectiles, guns, and metal-working machin- ery. The work of the section put an end to a period of opera-bouffe looting. It is stated that at one time two hun- '. I * I '^ I I i u I I Hi 196 INDUSTRIAL AMERICA IN THE WORLD WAR dred motor trucks from these Russian stores were being used by the grafters in private trucking businesses on Long Island. The sidmgs for twenty or a hundred miles back of Seattle and Vancouver (B.C.) were blocked with Russian goods mixed up with goods intended for Japan. The latter were of course, legitimate, but the work of the Stores Section con- tributed to getting them moved out and sent on their way. The Emergency Construction Committee, under W. A. Star- rett, of New York, is properly considered here because, while Its work was pretty well headed into the War Department, it played a large part in equalizing supply and demand through Its introduction of form and plan into the huge building programme of the army, which involved in its earlier stages some 336 projects costing $619,000,000. The most impres- sive phase of the committee's work was during the rush to build the cantonments for the National Army in the spring and summer of 1917. It was responsible for the creation, organization, and, largely, the personnel of the Army Con- struction Division, and until the end of the war it maintained the most intimate relations of an advisory and informative nature to that division. It acted as a clearing-house for commodity sections that were concerned with building and building materials, and was very helpful to the United States Housing Corporation in its early stages. As the army had virtually no building organization at the beginning of the war, the practical men of the committee carried the load of the brilliant achievement of erecting, in about ninety days, the edifices of temporary cities of thirty thousand population each lor fifty army divisions, as well as other army build- ings. Without Its practical knowledge and inspiration one ot the most impressive construction feats in the history of the world would, under the circumstances, inevitably have been a long-drawn-out chaos. As this committee was the pioneer governmental agency in dealing with cost-plus contracts, it was a storm center of criticism arising from the inevitable abuses of that form of business relationship, but no one has yet brought forward any substitute for its method of meeting the building emergency that confronted it. This emergency was marked by the foUowing features: tHe projects arose quickly and unexpectedly; there was little BALANCING SUPPLY AND DEMAND 197 or no time between conception and inauguration of the work; preliminary estimates of cost were impossible; planning and building had to go on together as the work developed. Under these and many surrounding circumstances, together with the fact that immense lump sums had been appropriated which might be far in excess of costs, and were, therefore, tempting to reckless and profiteering contractors, it was felt that the Gov- ernment must rely on the "strong and experienced building organizations of the country." That these organizations did not abuse the confidence that was reposed in them is shown by the fact that the average contractor's remuneration on the 1917 work was only 4 1/2 per cent, and on the total only 3 2/3 per cent. Undoubtedly the costs to which these percent- ages^ were applicable were excessive as compared with cor- responding costs in ordinary times, but they were less than they would have been if contracts had been let on bids to careful and responsible builders, who would have been com- pelled to allow ample protective margins against the runaway prices of the times. G. W. Lundoff , of Cleveland, was for a short time chairman of the committee, but throughout its period of attachment to the War Industries Board Mr. Starrett was its chairman. Ftederick Law Olmsted, of Boston, was a member of the committee from its beginning. In the final period the other members were John Donlin, president of the Building Trades Section of the American Federation of Labor; Major Clair Foster, Engineers Corps; and Lieutenant J. B. Talmadge, secretary. At an earlier period Major M. C. Kelly represented the Engineers, and M. C. Tuttle, of Boston, was another member. The Inland Traffic Section was virtually the channel of communication between the War Industries Board and the Government Railroad Administration, whereby the railways were made responsive to the policies of the War Industries Board. This was a tremendously important function, but is so bound up with the Railroad Administration proper that to attempt even to sketch the section's work would be to write a short history of the Railroad Administration. T. C. Powell, an experienced railway man, an important officer of ^Thanks to the good judgment of Julius Rosenwald, the amount of profit on any single contract was limited to $250,000, which was productive of effi- ciency and celerity and brought down the profit percentage. k 198 INDUSTRIAL AMERICA IN THE WORLD WAR i . M h * the Railroad Administration and a member of the Priorities Committee, headed this section. As such he became the great war-time conservator and husbander of railway transportation. The railways, like many other agencies, "won the war," but no small part of their share in the victory was due to the manner in which the most was made of the total sum of transportation, which was primarily a War Industries Board job. So close and loyal was the union between the War Industries Board and the railways that for war purposes the latter were as much at the disposal of the Board as any of its own divisions or sections. As an outcome of the development of the plan for balanc- ing requirements and resources, the Facilities Division was established as the war was nearing its end. It was to handle the problem of providing facilities of manufacture to meet future requirements after they had been approved by the Requirements Division and the appropriate commodity sec- tions; and, in regard to immediate orders, was to clear them with advice or instruction as to what facilities were to be used. In a word, it was to be the supreme conserver of man- ufacturing instrumentalities to the end that they might to the greatest possible degree carry the burdens that were assigned to them. In a way the Facilities Division was but a further step beyond the field of the Resources and Conver- sion Section, but it was intended to be more of a future- regarding and planning body, with an almost unlimited scope. Its creation affords an admirable illustration of the grasp, foresight, and vision with which the War Industries Board was dealing with its colossal problems in the latter part of 1918.' Samuel P. Bush, of Columbus, Ohio, was made chief of ^The duties of the Facilities Division were laid down by the War Industries Board as follows: (1) "The division will make a comprehensive study of all aspects of new construction projects, advising in respect to proposed locations on the availability of power, fuel, labor, building materials, raw materials, etc.; (2) it will advise in the selection and specification of materials of construction, so as to avoid long hauls, especially through the congested district, and so as to avoid confli9t8 with orders already placed; (3) it will look to the adoption of forms of contract such as will insure uniiformity and consistency in all Government building activities; (4) it will compile and from time to time revise lists of responsible contractors and architects throughout the United States equipped to undertake construction work of various kinds, furnish such lists to Government agencies upon request, and it will keep a record of existing Government contracts with a view to preventing interference between new and BALANCING SUPPLY AND DEMAND 199 this division. He was a successful manufacturer and had been chief of the Board's Section of Forgings, Ordnance, Small Arms, and Ammunition. His assistants were Captain C. Bamberger, C. W. Carroll, M. F. Chase, F. L. Dame, Captain W. B. Dickinson, J. I. Downey, L. H. Kittredge, G. E. Miller, L. B. Reed, and H. Williams. The big task ahead of this division was that of reducing the congestion in the northeastern section of the country through the devel- opment of facilities elsewhere, and the prevention of any like jams in the future. The so-called breakdown of the rail- ways under private management was chiefly the result of the overloading of this industrial section with Government busi- ness. It got to be almost impossible to get goods into or out of this region because the railways were called upon to do two years' work in one. The Government Railroad Adminis- tration found the problem as hopeless as the private man- agers, and Mr. McAdoo called upon the President to take steps to extricate the railways from a condition in which they were slowly strangling. The President turned to the War Industries Board, which was, however, already working on the problem through a number of channels, with the pur- pose of diverting a part of the Government demand to other sections of the country. No lesson of the industrial side of the war will be longer remembered than that taught by the penalties of the over- working of the northeastern section of the country. Even without a Grand General Staff or some equivalent organiza- tion, no efficient industrial mobilizer of this generation will permit the repetition of the error of 1917, whereby the manu- facturing potentiality of the country and the efficiency of a large part of its railroad system and marine transport were almost negatived by a congestion of production and transportation. The harm was done before the War Industries Board had grown up to its full stature and responsibilities. It was easily and naturally done because the northeastern old orders; (5) it will prevent the creation of new facilities in localities where the condition of existing facilities is such that new ones would be inadvisable; (6) it will endeavor to coordinate the activities of all departments and agencies of the Government in construction work of every kind except shipbuilding; and (7) it will study prospective departmental needs and make plans for the new facilities necessary to meet them." (Final Report of War Industries Board.) 200 INDUSTRIAL AMERICA IN THE WORLD WAR BALANCING SUPPLY AND DEMAND 201 I. Li I 1 II I . i| region is the center of the metal-making and using industries, and also the region of the greatest general manufacturing development. To go elsewhere meant investigation, planning, and conversion. So the Government purchasing agencies fol- lowed the path of least resistance, and kept on following it until long after it was the one of the most resistance. The result was that the most extensive industrial region in Amer- ica came near to nullification as a contributor to the early- success of the war by being smothered under the immovable mass of its own product. One of the most interesting growths in a war organization that was a congeries of growths — which like all living things are full of interest — was the Division of Planning and Statistics. This was really the War Industries facet of a threefold statistical organization, which grew up from neces- sity rather than from a triune plan. The army was demand- ing more and more ships from the Shipping Board. To grant these demands the Board had to withdraw ships from com- mercial uses that were fundamentally military, and also to disturb the balance of trade upon which depended the possi- bility of securing the foreign materials that were necessary to the industrial life of the country. A nice priority prob- lem was involved. It could not be solved unless the War Industries Board, the Shipping Board, and the War Trade Board were all tied in. Judge Parker first sought to meet the problem by estab- lishing Dean Edwin F. Gay, of Harvard, then a member of the Commercial Economy Board of the Council of National Defense, later the Conservation Division of the War Indus- tries Board, as an expert adviser to him in priority matters relating to shipping. This did not appeal to Dean Gay as meeting the triangular situation, but when Chairman Edward N. Hurley, of the Shipping Board, asked him to establish for that body a Division of Planning and Statistics whose first important job would be to study imports with a view to applying the principle of priority to their reduction in order to release shipping for the army, he accepted; the more readily as he was simultaneously made a member of the War Trade Board. In the latter capacity Dean Gay was able personally and authoritatively to urge the reduction of imports through that body's control in accordance with the result of his investiga- tion. This investigation was designed to establish a list of materials which could be entirely excluded from importa- tion, another of those that would be excluded in part, and a third of those that would have to be imported in full or larger than current amounts. Thus a Shipping Board Divi- sion had completely invaded the peculiar field of the War Industries Board in the task of balancing supply and demand, or resources and requirements. At the same time the War Industries Board had its member of the War Trade Board and was continually resorting to foreign trade control in its manipulation of industrial strategy. About this time the War Industries Board lost to the army the Statistical Division of the Council of National Defense, which was taken over almost in a body by the General Staff. This division, initiated by the writer's predecessor, and headed by Dr. (Colonel) Leonard P. Ayres, a purely civilian enterprise, had turned out to be of inestimable value to the army, which, surprisingly enough, came into the war without any adequate statistical organization erf its own. Thus deprived of a general informational instru- mentality, the War Industries Board naturally turned to Dean Gay, who by this time had established a Bureau of Research and Tabulation of Statistics in the War Trade Board. With the setting-up of the Division of Planning and Statistics of the War Industries Board there was established a machine of coordination between shipping, foreign, and domestic trade. But the purpose of the new division was even more ambi- tious. It was intended to be the seer and prophet of the War Industries Board, the general agency of deliberative and reflective contact with the Board's impending problems and the supplier of data for the solving of its current problems. Virtually all of the commodity sections and divisions of the Board were conducting their own statistical researches, but, entirely apart from the needs of central survey and general thought, there was need of a composition of the data obtained by them. Dean Gay was chairman and Henry S. Dennison assistant II I I 1 , I ( ' I ■1 \ 202 INDUSTRIAL AMERICA IN THE WORLD WAR chairman of the new division. Dr. Henry R. Hatfield was in immediate charge, and six sections were established. The Section on Price-Fixing, under Professor W. C. Mitchell, worked in close cooperation with the Price-Fixing Committee. It made a thorough study of war-time price movements, the results of which were published in a series of fifty-seven War Industries Board bulletins. The War Contracts Section, under Mills E. Case, sought to obtain a complete record of war contracts and deliveries, but was never fully successful in this because of the impossibility of getting the purchasing agencies to make full reports. Efforts to obtain information directly from manufacturers did not fare much better, and this phase of the requirements programme shared in the general defectiveness of the determination of requirements, which went primarily to the War Department's failure in this respect — a failure that was partly destined in the circum- stances and partly the result of the failure of the human factor. The Editorial Section informed war agencies of the status of the supply programme; the Section on War Industries Abroad gleaned helpful information from the industrial experience of allies and enemies, and the Commodity Statis- tics Section drew to central points the statistical data of the commodity sections, helped them to organize their own statis- tical agencies and collect information, and assisted in the formation of joint statistical instrumentalities between the sections and other war agencies. The Questionnaire Section centralized the function of obtaining information by circulars. So many Government agencies had recourse to the mimeograph, the printing-press, and the mail in the quest of information that the burden of responding adequately became an intolerable absorber of time, labor, and expense to Government contractors. In many instances it was necessary to maintain large staffs for the purpose of answering the cloud of questionnaires. It was ordered that all War Industries Board queries should be issued through the Questionnaire Section, and eventually it became the questionnaire medium for pretty much all departments. When President Wilson began to meet the heads of certain BALANCING SUPPLY AND DEMAND 203 war agencies weekly in the so-called War Cabinet, he felt the need of a clear and concise presentation of the progress of the war enterprise. The establishment of such a periodical survey had been recommended to him by the writer when secretary of the Council of National Defense, as well as by Representative Swagar Sherley, chairman of the House Appropriations Committee. The President asked the writer to elaborate his views and then immediately called on Mr. Baruch for this "conspectus," but, owing to a desire to avoid any suggestion of the superimposition of the Board over other agencies, they made their returns of the required data to the President, who then sent them to the War Industries Board for digestion by the Division of Planning and Statis- tics. Because of the secret and confidential nature of the data, a carefully chosen staff, with separate quarters, was assigned to them. The first thing to do was to compile a review of the various war agencies and their functions; the next to arrange for a flow of statistical data from each of them for summaries that were at first monthly and then weekly. The review had the advantage of showing overlappings and duplications of func- tions. For the purpose of getting the precise information required, "contact" men were established in the different war agencies. The first report this section secured from the Navy Department is believed to be the first consolidated report that even the Secretary of the Navy had ever had. So airtight were some of the bureaus in the war agencies that the compilers of the conspectus found themselves in posses- sion of information that was not available to other bureaus within an agency! The conspectus was compiled weekly for some time after the armistice and was sent regularly to the President while he was in Paris, thus providing him while away from the Capital with an excellent governmental panorama. In general, the section had the most cordial cooperation of all departments, though there was some opposition to the compression of data that the section was bound to make in preparing a bird's-eye view of the general situation, as the departments naturally wanted the President to see a full and detailed statement of their achievements. In the case of the i 'I 'i I 204 INDUSTRIAL AMERICA IN THE WORLD WAR War Department there was also the difficulty that both the General Staff and the supply agencies had separate statis- tical organizations. For some reason the Labor Department was a hard one from which to extract data at first. The State Department was so independent that no effort was made to include its activities in the conspectus, and it is doubtful if the President ever had more than a loose and general verbal account of the information gathered from its various foreign representatives. The Department of Justice was also a hard nut to crack, and the writer has it on excellent authority that the President probably never knew very much about that department's activities. The compilation of the conspectus involved searching and critical inquiries, and brought out among other facts the important one that the army was prone to overestimate requirements when it did estimate, without regard to the facilities for manufacture and conveyance and the rate of consumption of the goods. Important revisions of estimates followed. This work showed, too, that the War Industries Board should not have drawn the line between civilian and military duties so sharply that it would rarely question the validity of a military statement of requirements. The reve- lations of the conspectus research would doubtless have brought about a certain intervention of the Board in require- ments at their source, but it was ticklish ground. The three-in-one statistical organization of the Shipping Board, the War Trade Board, and the War Industries Board was powerful in working harmonious cooperation in the balancing of marine transport, facility, and requirement. It was largely instrumental in releasing shipping for military service by reducing imports. In fact it was on the prospect of its success that President Wilson pledged General Pershing a large accession to the troop and military cargo fleet, when such an assurance was indispensable to the General's plans.^ ^As a matter of fact, the Ship Control Committee, set up by the Shipping Board, appears to have allocated ships in defiance of the War Industries Board. It was the Allied Maritime Council that really saw to it that ships were pro- vided for Pershing. The United States was represented on the Council by Commissioner Stevens, of the Shipping Board, assisted by Dwight Morrow, of J. P. Morgan & Co., and George Rublee. The British members, at the height of the shipping crisis in May, 1918, convinced the Americans that the United BALANCING SUPPLY AND DEMAND 205 The Statistical Division was frequently called upon for special investigations and reports, such, for example, as one on watches for the A.E.F. and another on the "thrift" cam- paign for the Treasury Department. Immediately after the war it put out an invaluable volume on the history of prices during the war. The statistical bodies of the Shipping Board, the War Industries Board, the Food Administration, the Fuel Administration, and the War Trade Board joined in making a survey of the economic situation of the world, with par- ticular reference to the United States, for the uses of the Peace Conference. Dr. Hatfield was chairman, of the Fusion Committee; Dr. Ernest L. Bogart represented the War Trade Board; Dr. Frank M. Surface, the Food Administration; Mr. Finch, the Shipping Board; and Dr. Leo Wolman, the War Industries Board. The division also made a study of post- war labor conditions, in connection with the Department of Labor, and issued weekly reports on labor conditions which were of value in industrial readjustment following demobili- zation and the suspension of war industries. This work was transferred, after the dissolution of the War Industries Board, to the War Trade Board and was continued well into 1919. It is noteworthy that the Statistical Division was only coming into its own when the war ended. Logically it should have been the first agency of the War Industries Board to be developed to its full capacity; really it was the last. First to last, in all Government departments, the lack of ordered facts was a cause of inaction or of mistaken action. They were in a sense blinded because they had not developed eyes. Their work gave them eyes, whereas their eyes should have selected their work. Nobody is to be blamed for this except the Nation itself, which elected to be unprepared in the face of war just as it is now so electing even after the searing lessons of war. When the house is burning up, the first thing to do is throw on some extinguisher — not to States was not doing its full share in the shipping pool because it had left too many ships in private trade. Mr. Stevens was so impressed that he sent Rublee and Moriow back to Washington to explain the situation to President Wilson. The former talked with the President personally, and both of them conferred with Baruch repeatedly. The fact that the American members were so ill- informed in regard to materials requiring shipping was one of the reasons for the creation of the Foreign Economic Mission of the Board, which by producing the facts was able to give great assistance to the Council. i' iil I I I : 1 t - ') I 206 INDUSTRIAL AMERICA IN THE WORLD WAR compile a statistical study of the fire department's resources for fighting fire. The War Trade Board, as a rule, worked so harmoniously with the War Industries Board that it could hardly have done the latter Board's programme better service if it had been an integral part of it. The two agencies were so closely related that it would have been better, theoretically, if the War Trade Board had been made subject to the War Indus- tries Board. It was correctly in line with the duties of the latter board, as the balancer of requirements and resources to have complete control of imports. As we have seen, how- ever, through the three-cornered statistical and planning organization there was a large degree of coordination between shipping, foreign trade, and internal trade. But beyond this the War Trade Board, in a spirit of complete cooperation, surrendered to the War Industries Board absolute control over foreign goods once they were imported. So, while the latter board was not in a position to dictate the nature and volume of imports, it was master of them once they were admitted — at least, after the reorganization following Mr. Baruch's appointment as chairman. To make this union of the two bodies a vital one, Mr. C. M. WooUey was designated as the War Trade Board member specially charged with War Industries Board relations. He was also the War Trade Board's representative on the Prior- ity Board of the War Industries Board and was in almost daily personal touch with Mr. Baruch. The latter and Vance McCormick, chairman of the War Trade Board, were also in continuous touch with each other. Dr. Alonzo Taylor, a member of the Food Administration and its rep- resentative on the War Trade Board — one of the clearest minds in Washington — was a potent agent for cooperation between the War Industries Board and the War Trade Board, and also the Food Administration. Mr. McCormick has perhaps never been given full credit for effective and self-sacrificing work. Like Baruch, he was indifferent to self-glorification and toiled whole-heartedly for the common goal, never thinking of or seeking personal or departmental distinction. The War Industries Board, through its Foreign Mission and its requirements of foreign products, and its BALANCING SUPPLY AND DEMAND 207 need of regulating the outflow of American goods, was con- tinually invading the field of the sister board, but always with its cordial approval and assistance. On the other hand, the War Trade Board in negotiating treaties with the neutral countries, for the double purpose of economically isolating Germany and securing needed supplies for the Allies, often had to pledge in return certain American materials, which brought it into the sphere of the War Industries Board. It was for the latter to determine what could be spared. Thus it had its hand on both imports and exports in the interminable efi'ort to balance goods and needs. As the War Industries Board was always skating on very thin ice in the matter of legal authority for its policies and acts, it had great need of a mobile, resourceful, and tactful legal department. One of the thinnest and most treacherous spots was the reconcilement of the virtual pooling of pro- duction and orders absolutely essential to the coordination of industrial potentialities with the inhibition of combina- tions by the anti-trust laws. Another rubber-ice spot was the question of responsibility for damages resulting from the application of priority regulations. This was not so much from the producers, who had to shape their deliveries according to priority instructions, as it was from those whose orders with producers were delayed or cancelled because of Government necessity. On these and many other matters the whole War Industries Board was often in need of the sagest counsel. The Legal Department was placed in the Priorities Division. Thomas N. Perkins, of Boston, was chief counsel, and Robert J. Bulkley, of Cleveland, was chairman of the legal committee.^ The general counsel of the Board itself was Albert C. Ritchie, now Governor of Maryland. International questions were handled by Chandler P. Anderson, former counselor of the Department of State. All served without compensation and even paid their own expenses. The small amount of litigation that has xrrnl^^ ^*^®o ™e°»^ers of the committee were Henry M. Channing, Boston; Wiltord C. Saeger, Cleveland; Walter H. Pollak, New York; Charles W. McKelvey, New York; E. M. Dodd, Jr., Cambridge, Mass.; Herbert A. Friedlich, Washington, D. C; Louis S. Weiss, New York; D. H. Van Doren. East Orange, N. J.; A. Ettinger, Cleveland. ' ; 208 INDUSTRIAL AMERICA IN THE WORLD WAR resulted from the War Industries Board's operations is the measure of the success of the Legal Department. Another functional body, associated with the Priorities Division, was the Labor Priorities Section, which will be considered, however, in the chapter on the Labor Division of the Board, which in a large sense was the balancer of labor supply and demand. The Employment Management Courses Section, though organically in Mr. Legge's admin- istrative division of the Board, naturally falls into that chapter also. There are still other sections that might be classed as exercising special functions in the balancing of resources and requirements, but as virtually all the sections, though classified by the commodities they dealt with, were at all times primarily functioning in that capacity, it would be profitless to follow further the segregational basis of this chapter. The story of their work will be told under subjective chapter groupings. In truth, the whole War Industries Board was but a vast industrial stabilizing and equalizing mechanism. It all seems complex, intricate, and illogical in many respects. It was not a standardized product; it was built on the ground and patched and added to to do the work that must be done. It was made by its environment and was adapted to it. I 1 ' I h CHAPTER XI CONSERVATION: REDUCING AMERICA'S SURPLUS TISSUE Thrift at the source — Shaw projects his plan — First, economy; second, economy; third, economy — Bread for two hundred thousand persons saved — I he chemistry of voluntary cooperation - The technique of procedure - Cur- tailing the capricious customer — Paper wrappers for wooden cases — Excising the dead matter of industry - Nine lines of approach - Ambassador Jusserand and the modistes -Shaw attacks corset steel, tin, spool thread, typewriter ribbons, farm wagons, buggy axles, trace chains, motor-cycles, alarm clocks, tinfoil -Salvaging wool for nine hundred thousand uniforms - Peace-time benefits -Shaw meets Baruch - Conservation without destruction succeeds - Lessons for to-day and to-morrow. Let us liken the American industrial Colossus, adapting and fitting Itself to war, to a strong but over-fat athlete getting into condition. It may be said with a sufficient degree of accuracy that, while other parts of the War Industries Board supplied the conditioning exercise, the Conservation Division directed the internal removal of superfluous tissue. While the other divisions and sections toughened and strengthened the muscles, the Conservation Division reduced the fat. The simile is applicable in another view, too. The War Industries Board strove to get its fighting Nation into trim without jpermanent injury to the muscles that were not needed for the task. This policy was peculiarly the function of the Conservation Division. Instead of leaving the unneeded muscles to atrophy, it gave them enough attention to keep them alive whilst eliminating all useless tissue. Instead of abandoning industries that could be dispensed with in war, the general policy was to eliminate from all industries — even the most essential — all the non- essential parts, processes, functions, and products. The outcome was a fighting Nation, hard as nails. The more essential industries were necessarily developed beyond the requirements of peace-time symmetry, but the less essential were still vital and ready to "come back" rapidly and easily — and they did. War-time conservation, as practiced in America, was a policy of saving and husbanding rather than of ruthless elimination. - »i i rgi->t v i i rt' i 210 INDUSTRIAL AMERICA IN THE WORLD WAR The Conservation Division was the one agency through which the quietly performing War Industries Board, work- ing for the most part with the controlling men of the great industries through unheralded and often unknown confer- ences and agreements, and through regulations that directly affected economic integrations rather than the individual citizen, was in contact with the citizen. Ask the average merchant or manufacturer what the War Industries Board did, and nine times out of ten he will refer to functions of the Conservation Division. Ask the men or women in the street, and they will tell you that it lowered women's boots and curtailed women's skirts or gave the man his smoking tobacco in paper instead of tin and made him take the place of a delivery wagon with respect to the household commissariat. In the public mind the Conservation Division ranked with the Food and Fuel Administrations as an intrusive and, therefore, highly interesting factor in daily life. The Food Administration shaped the citizen's bill of fare; the Fuel Administration figured in his fuel quan- tities, qualities, and costs, and in his lighting of office and home; the Conservation Division shortened his coat, altered its material, defined its color and pattern, and touched the customs and habits of his life at many other points. The function of the Conservation Division was the exercise of thrift at the source, as distinguished from money savings, which might or might not result in the actual saving of labor, service, and materials. It was a tangible saving and its fruits were immediately and automatically available for war purposes. A man released by this sort of economy was one man more for the army or another worker for the war industries; a pound of steel saved by it was another pound for ships or guns or some other of the many war requirements for a commodity in which there was a deficit. To save and salvage is so obvious a complement of intensified production to meet a surpassing demand, and so much easier of immediate approach, that it is not surprising to find that the Council of National Defense had an efiicient organization for this purpose while much of its other work was still in process of incubation. Also, it was a function that could be undertaken to a large extent without the Q < O pq cc H a} P Q ^ H P^ O O l-H CO > Q O (^ H < o u - 04 •= W O a> • o M as c c jT ea ;: QQ C -r S «S .2 * S C 03 ~ >^^ ^ °^ t-* o .1 ^ ^ r t> ...5 i J3 CO ^ -c S ^ o 0, »^ •§ :§ -^ ^ i^ ^ 2 ^. (^ J 1 1 >* Q.. . t- •" ST C aj ^ > o; « o c ;^ •• *- 5 «QQ aj^ S^-cQ . j^ r t>'^. c S -o o .5 a^H.2^ - « < r'' • « S ■« ~ j^J S • *■ 2 ;i> t S o . - "5 .J: a> .2^ u, «> o ►Si S =: o •« INTENTIONAL SECOND EXPOSURE 210 INDUSTRIAL AMERICA IN THE WORLD WAR The Conservation Division was the one agency through which the quietly performing War Industries Board, work- ing for the most part with the controlling men of the great industries through unheralded and often unknown confer- ences and agreements, and through regulations that directly affected economic integrations rather than the individual citizen, was in contact with the citizen. Ask the average merchant or manufacturer what the War Industries Board did, and nine times out of ten he will refer to functions of the Conservation Division. Ask the men or women in the street, and they will tell you that it lowered women's boots and curtailed women's skirts or gave the man his smoking tobacco in paper instead of tin and made him take the place of a delivery wagon with respect to the household commissariat. In the public mind the Conservation Division ranked with the Food and Fuel Administrations as an intrusive and, therefore, highly interesting factor in daily life. The Food Administration shaped the citizen's bill of fare; the Fuel Administration figured in his fuel quan- tities, qualities, and costs, and in his lighting of office and home; the Conservation Division shortened his coat, altered its material, defined its color and pattern, and touched the customs and habits of his life at many other points. The function of the Conservation Division was the exercise of thrift at the source, as distinguished from money savings, which might or might not result in the actual saving of labor, service, and materials. It was a tangible saving and its fruits were immediately and automatically available for war purposes. A man released by this sort of economy was one man more for the army or another worker for the war industries; a pound of steel saved by it was another pound for ships or guns or some other of the many war requirements for a commodity in which there was a deficit. To save and salvage is so obvious a complement of intensified production to meet a surpassing demand, and so much easier of immediate approach, that it is not surprising to find that the Council of National Defense had an efficient organization for this purpose while much of its other work was still in process of incubation. Also, it was a function that could be undertaken to a large extent without the I > o cc ^ -n ^ - O PQ cc « H J» P Q (—1 < K H O O > Q O =3 5 03 ? C C3 ^ ft, ^ ^ •^ a " ^- = « I l" i^ 3 i. '^■^'< in 'I "1 " Q k > o H > -M = S £ r-i "^ «|!? g^V B o; ^ g t « ^ .^ * -5 £ qT o Ti: c Z fc> « es 0) 'Ja hi a U .2 a, -S 03 c c m S ^ . o o *^ 03 ^s o . £ 2 ^. 5 S« ea ^ I— I JS la ►T9 jS "« -; Ho « 5 c - _ ^ 5 ^ -"^ 5 o £^ - = £ = «^ •t: >S; !^ ^ -^ ■" = I 11=1 - - es 5 I =" 6 2 2^ « ^ Q ?- ° c o o . •¥ _ O c ^* o ^ ^ LT o ^ -n ^ ^ u S O ;;-; ^ ^ p C > o ^- •= ^ "^ ^ Jrf -— bt • '" ,- C . *" ^^ .^ J Q -I •§ i ^ C.- - t- r o 5 a* ^ .° -= 5 - lt -^ * r 03 -r b O ^ - >i 03 ^ . = e3 J= » r*- • (X 03 -c rr • - = . "^^ :• o ^ », -Ji o ^ • » -^ •- ^. fe a: - I = K e a; ^ -^ ►- „ «- u -^ - 3 a ■3 .^ 01 i) Jl r U i ki' I ll i u •f I I REDUCING AMERICA'S SURPLUS TISSUE 211 cooperation of the war-making agencies, and, consequently, was a simpler and more direct task. There was no need to wait on war programmes and requirements, as in the case of production. The subject-matter was ready in the per- fectly patent excess baggage of services and goods with which a settled life encumbers itself. Yet the initiative in this important enterprise was supplied by a man who was not at the time connected with the Council or its Advisory Commission. A Chicago business man, A. W. Shaw, a publisher of business books and magazines, notably "System," was, appropriately enough, the initiator. His business interests in England had resulted in bringing very forcibly to his attention how little system there was in both England and France in the studied adaptation of industry, commerce, and civil life in general to the requirements of war. He found that the principle of orderly priority was virtually unknown in those countries outside of the rationing of the people. Civil and military needs were largely left to free com- petition with each other for capital, labor, facilities, and materials; while in Germany they were following a very definite plan of "stretching industry." Like many other patriotic citizens, Mr. Shaw went to Washington, in the days of suspenseful, belated preparation just preceding the declaration of war, to ascertain through the Council of National Defense what was being done or needed to be done to meet the approaching test. He had clear and well-defined ideas of commercial economy applied as a means of meeting the unprecedented demands which he knew, from personal observation in England and study of the economic reactions of war in Germany and France, would tax the energy and resources of the Nation to the utmost. Finally, in a luncheon interview with Secretary of Agriculture Houston on March 23, 1917, he presented his plan so persuasively and convincingly that Mr. Houston was an immediate convert. Secretary of the Interior Lane — also a member of the Council — was immediately called into the conference by Mr. Houston, and he asked Mr. Shaw to put his proposals into writing at once, so that they might ' ! f V * H ( ( I II n 4 212 INDUSTRIAL AMERICA IN THE WORLD WAR be submitted to the Council at a meeting to be held the next morning. This was done, the Council approved, and the Commercial Economy Board was immediately instituted with Mr. Shaw as chairman. It is worth mentioning that the Commercial Economy Board was a creature of the Council proper, not of the Advisory Commission which mothered most of the other activities that were grouped around the Council. Thus, until the Commercial Economy Board became a part of the War Industries Board a year later, as the Conservation Division of the latter, it occupied a position independent of the Advisory Commission and all its activities. This was a fortunate detachment. The Council was reluctant formally to endorse much of what the Board was doing, though the feeling of the individual members was that it ought to be done, so the Council for the most part looked the other way and let Mr. Shaw and his colleagues proceed according to their own judgment. In this way they were probably freer than they would have been if attached to the Advisory Commission, which, being responsible to the Council, might not have felt itself at liberty to give the Commercial Economy Board a wide range of independence without positive approval by the Council. On the other hand was a distinct advantage to the conservation function to be merged later with the War Industries Board when the latter had become an organism of power. Mr. Shaw named as his associates W. D. Simmons, pres- ident of the Simmons Hardware Company, of St. Louis; E. F. Gay, dean of the Graduate School of Business Admin- istration of Harvard University; George Rublee, a lawyer and member of the Eight-Hour Commission; and Henry S. Dennison, president of the Dennison Manufacturing Com- pany, of Framingham, Massachusetts. Dr. HoUis Godfrey, of the Advisory Commission, was a member, ex-officio, of the Board; Alfred Pittman was assistant to the chairman, and Melvin T. Copeland was secretary. Mr. Shaw was determined in his choice of associates by the considerations of having business theory and practical merchandising and manufacturing experience and legal knowledge at his command. His judgment was confirmed both by the work REDUCING AMERICA'S SURPLUS TISSUE 213 of the Board and by the fact that all four of the men he chose were ultimately called upon to render other services to the Government. Dean Gay became a member of the War Trade Board and chairman of the Division of Planning and Statistics of the War Industries Board, as well as of the statistical departments of the War Trade Board and of the Shipping Board; Mr. Simmons became a member of the Treasury Advisory Board ; Mr. Rublee became the alternate American member of the Economic Council of the Allies and the United States; and Mr. Dennison became assistant chairman of the Division of Planning and Statistics, and also of the Shipping Board's statistical and planning work. The Commercial Economy Board early established its purposes as follows: (1) to determine how economies can be effected in the distribution of commodities; (2) to determine what commercial services can be curtailed or dispensed with during the war; (3) to determine what economies can be made in the management of commercial businesses; (4) to study efficiency of administration with a view to conveying the results to less efficient business organizations; (5) to study operating expenses for the purposes of arriving at standards for general guidance; (6) to determine means of effecting economies in the commercial use of materials, such as wool and leather, that would be needed by the Government in large quantities. The Council had not yet called on Herbert Hoover to take up the advisory work which was to lead to his becoming Food Administrator, so, as economy in the use of the primary foodstuff of the white races, wheat, seemed to be of prime importance, Mr. Shaw first set about a study of the uses and distribution of wheat. Bread seemed the nearest and most approachable angle of this subject. The handling of this first attempt to shape private economy for the public good became the model for the whole vast work that followed. The bakers were asked for suggestions, and their responses emphasized the matters of waste in delivery and in the returning of unsold bread by the retailers. It appeared that about five per cent of all bread made by bakeries was returned because it became stale before it could be disposed of. Having the privilege of returning 214 INDUSTRIAL AMERICA IN THE WORLD WAR r I i the loaves they could not dispose of, retailers were naturally in the habit of insuring sufficient supplies by ordering a little more than they probably would sell. Some of the returned bread eventually entered into human consumption, but most of it was food waste. Yet the total of the returns was enough to supply bread to two hundred thousand people, and there was an attendant waste of men and equipment involved in the handling of the surplus. The situation having been definitely determined by conferences and correspondence, and all but three of the wholesale bakers consulted having agreed that the elimination of the bread- return privilege was wise and feasible, a circular was issued to the trade on June 6, 1917, setting forth the consensus of opinion as to the desirability and practicability of the proposed economy and stating that it was the desire of the Government that it be efifected. The response was unanimous. As time went on, the Commercial Economy Board gained moral authority from custom and habit, and when it became the Conservation Division of the War Industries Board it had all of the powers that the Board had; but from first to last it conducted all of its operations on the principle of the bread regulation — of voluntary cooperation. It neither sought nor used power, for the controlling reason that it was profoundly convinced that imposed control could never be as effective as voluntary cooperation for a rational, common objective. This was not a mere theory bom of optimistic confidence in men, but a definite conclusion to which Mr. Shaw had come from close observation of the way legal control worked in France, England, and Germany. As with the prohibition law in this country, it was there accepted as a challenge to a battle of furtive evasion and ingenious violation. It required elaborate and exaspera- ting policing that resulted in large expense and a great waste of energy. And its effect on the popular morale was most demoralizing, for it concentrated public attention on the personal hardships of war and diverted it from the national purpose. In fact, it tended to divide the nation into hostile camps of occupational law enforcers, on the one hand, and the great mass of the people endeavoring to nullify it, on the other haad. REDUCING AMERICA'S SURPLUS TISSUE 215 The establishment of the Food Administration made it oiitside the scope of the Commercial Economy Board to proceed further with food economies, but the principle of cooperation rather than of command was adopted by that administration as the very foundation of its work. Before Mr. Hoover was designated as Food Administrator, under the Lever Act, he was asked his opinion of the intention to do away with the bread-return privilege wholly by voluntary cooperation. Fresh from his experience of the arbitrary methods prevailing in Europe, he was greatly impressed, and answered : "If this can be accomplished on a voluntary basis, it would be infinitely better than if we should set up an elaborate engine for enforcement." It was most success- fully accomplished — and it may be that the first achieve- ment of the Commercial Economy Board gave the Food Administration its policy bent. Following up its initial success, the Commercial Economy Board gave most of its attention in the early weeks of the war to savings that might be made in distribution of com- modities, leaving economies of production till a later time. The technique of procedure was always the same — the ascertainment of facts by inquiry and investigation, the elicitation of suggestions for economy from the trade interests involved, the formulation of cooperative regula- tions in conference, and finally the issuance of the "recommendation." Usually a few objectors and obstructors were encountered in each trade, but they always fell into line under the com- pulsion of trade opinion which automatically policed the observance of the recommendations. Whatever he may be at heart, no man covets the reputation of being a slacker or a sulker. He may flout and violate a law that he dislikes, but a practice adopted by the overwhelming consent and even insistence of his fellows, especially when it bears the label of patriotic service in a time of emergency, is not lightly to be disregarded. Men will seek to beat an arbitrary order, but they will loyally support an elected cooperative programme. Whether the voluntary method was the outcome of the reluctance of Congress to pass laws interfering with >1 iJ If ' -» 216 INDUSTRIAL AMERICA IN THE WORLD WAR ordinary commercial customs, thus leaving the adminis- trators of the commercial and industrial regulatory agencies without well-defined authority; or whether it was even more the outcome of a lesson from Europe's experience and knowledge of the American character is immaterial. The important fact is that from the start in the Council of National Defense the whole direction of industrial adapta- tion to the requirements and incidence of war was basically of the people rather than of the Government. Nowhere did this method meet with greater success than in the Conserva- tion Division, which, excepting the Food Administration, came intimately in contact with more individuals in their daily life than any other regulatory agency. After the elimination of the bread-return privilege, the Commercial Economy Board recommended the general adoption of the rule of no exchanges by retail stores of all sorts. It was found that as much as twenty-five per cent of the daily sales were brought back to the stores by capricious customers. Most of these exchange items were of small value, but they involved a tremendous waste of men and equipment. Then the Board inaugurated the plan of encouragement of the "buy-and-carry" habit, which was a complement of the recommendation for cooperative deliveries of merchandise and the adoption of only one delivery a day. The reductions in the number of men, animals, and motors thereby effected were startling. In more than three hundred of the larger cities merchants cut out special deliveries and reduced general deliveries to one a day; and cooperative delivery systems, which were still more economical, were established in about two hundred cities. In one city the number of delivery employees was reduced from 848 to 545, seventeen horse-drawn vehicles were discarded, and the number of automobiles used was lowered from 325 to 195. On the whole, the department stores found that simplification of deliveries reduced by twenty-five per cent the man power needed; the grocery stores had a corresponding reduction of fifty per cent, and the cooperative delivery systems sometimes operated with twenty-five per cent of the employees formerly needed. Another line of distributive economies was found in pack- I REDUCING AMERICA'S SURPLUS TISSUE 217 ing and transportation, which dovetailed into each other. By simplifying and altering the form and materials of packages intended for transportation by rail or boat, a very substantial saving was effected in car space. The substitu- tion of paper wrappers for pasteboard cartons and wooden packmg-cases in the hosiery and underwear trade alone was estimated to be the equivalent of 17,312 freight cars' space and to replace 141,800,000 cartons and more than 500,000 wooden cases. These changes, of course, not only saved transportation, but diverted to other and indispensable uses the pasteboard and box lumber that the knit goods manu- facturers could easily get along without. Like distributive economies were sought by increasing the number of units of goods placed in each container for shipment. Still another transportation and materials economy was effected by reducing the number of sample trunks carried by the traveling salesmen of dry-goods wholesalers. Some salesmen were accustomed to take with them nine or ten heavy trunks. The average number was reduced to two. In this way many baggage cars were released for troop trains and the railways were relieved of a heavy burden. Conservation by measures relating to delivery and methods ot packing, however, was but a scratch on the surface compared with the deep cuts into the mountain of waste of energy and material effected by the reorganization of industrial processes and practices. It was found that almost all industries were encumbered with an unbelievable amount of unexamined tradition, that resulted in duplica- tion of ^effort, waste of material, and unnecessary expendi- tures of energy. Industry as it was, compared to industry as it should be for war purposes, was as a barracks to a modem hotel. Everywhere was found the superfluity of luxury and taste and the impedimenta of custom. Much of the rubbish that loads and clogs the economic machine was found in totally parasitic jobs, and almost every sort of production and service was found to be barnacled with uselessness. So deep is this economic mould and parasitism that the men of the Conservation Division ultimately became convinced that modern civiliza- tion is become anemic from obesity. It is so encumbered M a 4h 218 INDUSTRIAL AMERICA IN THE WORLD WAR with what it is uselessly doing that vitality is denied to useful and essential organs. The simple life, thoroughly inculca- ted, it would seem from the work of the Conservation Division, would without increased productive effort take the sting out of the inequalities of life. Simplification of living, of production, and of distribution would insure an abundance of necessaries and comforts for all. Of course, the simple life is not to be thoroughly inculcated, any more than the race is suddenly to be raised to that degree of individual excellence which conditions the perfect social- istic state. Superfluity of services and an abundance of useless trinkets, gewgaws, and baubles are a part of the price that civilization pays for the money instrumentality. Barter is too laborious and tedious to be the means of accumulating rubbish. The Conservation Division found endless satisfaction and an almost inexhaustible source of supplies and power in these huge folds of fat of a luxurious civilization. Sloth- fully accumulated in the soft times of peace and surfeit, they were now converted from useless luxury to useful necessary. The fat was turned into muscle, and thus answered in a surprisingly large degree the question of how it would be possible for a busy nation to produce more in war than in peace, with thirteen million out of fifty-five million workers in the ranks or engaged in war service or production. The elimination of the emergently useless was accom- panied by a surprising release of energy, which fact throws a great light on the inefficiency of peace-time production. As Professor David Friday hints, it almost makes war appear a blessing instead of a curse. It took war to give comfort and sufficiency to millions who had not known them. Most of the soldiers were better clothed, better fed, and better housed than when at home, and their health was much better. Millions of toiling workers, more energetic and efficient than ever before, were healthier, wealthier, and happier than at any other time. It would appear to an amateur economist that, if some way could be found to keep the working people of the world busy with the vim of war-time, there would be such content and prosperity that REDUCING AMERICA'S SURPLUS TISSUE 219 the cancerous growths of social destruction would have noth- ing upon which to feed. The delicate task of removing the fat from the economic body without weakening the muscles or impairing its general health could not be accomplished in desultory fashion. It was necessary to have a programme applicable to all industries. Aside from the economies relating to distribution which have been glimpsed, there were nine lines of approach to the solution of the problem. These were defined by Mr. Shaw as follows: 1. To secure a maximum reduction in the number of styles and varieties, sizes, colors, or finishes of the product of industry. In this way economy in manufacturing was secured. The number of operations was reduced and by making larger runs less labor was required. Manufacturers were enabled to simplify and reduce their stocks of raw material, and the quantity of materials and the amount of capital tied up in the stocks of finished products in the hands of manufacturers, wholesalers, and retailers were lessened. 2. To eliminate the styles and varieties that took more than the strictly necessary amount of material; as, for example, by restricting the length and sweep of overcoats. 3. To eliminate features or accessories which used materials for adornment or convenience, but which were not actually essential to the serviceability or utility of the product. 4. To eliminate patterns and types of product that were less essential to the civilian population. 5. To substitute materials which were plentiful for those that were scarce and urgently needed for the war programme. For example, in numerous instances zinc was substituted for steel and other metals. 6. To discontinue the use of certain materials for unnecessary purposes, such as caustic soda in the manufacture of automobile tires. 7. To standardize sizes, lengths, widths, thicknesses, weights, gages, etc., of materials, parts, and sections by means of which proper strength and durability could be obtained with the employ- ment of a minimum of material and labor in manufacturing and a reduction of the quantity of material carried in stocks of parts and finished product. 8. To reduce the excessive waste of materials in manufacturing processes, such as chrome chemicals in certain branches of the leather tanning industry. 9. To secure economy in samples used in selling the product. I I J » I |.i t3 : i 220 INDUSTRIAL AMERICA IN THE WORLD WAR This being an interpretive and appraising history as much as a chronicle, it will be quite impossible to follow the appli- cation of these means of conservation through the two hundred and fifty industries affected by "schedules" that were issued or prepared by the Conservation Division. A schedule was the Division's name for a conservation pre- scription. Behind each schedule were congeries of con- ferences, discussions, investigations, and conclusions. Altogether they represent the most searching examination of American industry from the standpoint of stark necessity and efficiency that has ever been made. Their effectuation called for the highest degree of diplomatic management, and their promulgation involved the sagacious and general use of all manner of publicity — from circulars to the news and editorial columns of the general press, the pages of the magazines and of the trade periodicals, and to films of the moving-picture theaters. To make conservation go on an enthusiastic, cooperative basis it was necessary to "sell" it to the consumer as well as to the producer, to the dandy and the clubman as well as to the navvy and the proprietor, to the primping school girl, the fine lady, and the washwoman. Thus conservation became the intimate and popular side of the War Industries Board, which was otherwise little known and slightly appreciated by the public. Its ramifications even reached into the stately courses of international diplomacy and brought it to bear on the vanities of woman's dress. The dressmakers of Paris, in the midst of a somber desert of black and repression of the lighter side of life, planned for 1918 fashions that would call for an abundance of materials, which they hoped would loosen the purse-strings of prosperous and as yet unmourn- ing America. M. Jusserand, Ambassador of France, was appealed to. He promptly took the matter up with his Government, which in turn found a way to convince the modistes that the fashions for 1918 should be of the slim silhouette type. So for the practical purpose of saving twenty-five per cent of the material used in women's frocks and gowns, that there might be more material for uniforms and airplane wings and tents and the like, the Conservation REDUCING AMERICA'S SURPLUS TISSUE 221 Division brought it about that woman in 1918 should emulate Diana rather than Juno. The fashions thus set have smce evolved alarmingly in the three dimensions, and now have passed from the realm of economics to that of manners. Mars demanded many other sacrifices of women. First- quality steel was denied them for corsets to eive it to implements of war. Taking the weight and rustle out of their siUcs, as supplied by tin, gave three hundred tons of a much-needed metal to war industries. War-time scrimp- ing, as an offset, gave them more thread to the spool. As materials went up, manufacturers had cut down the length ot thread to a spool in order to maintain the traditional unit price. Less thread meant more spools, and more spools meant more wood, and more wood meant more space in packing and transportation. By putting the amount of thread on a spool back to two hundred from one hundred and fifty yards, Mr. Shaw saved die transportation space represented by six hundred cars. A small thing, you say. But a car meant more in the war dian a horse to King Richard at Bosworth Field. And the affair of the thread spool was but one of 1241 such savings. Typewriter ribbons are little things, but, by reducing the numbers of colors from one hundred and fifty to five, and doing away with the use of tinfoil and tin boxes for con- tamers of the ribbons, three hundred and ninety-five tons of steel were saved and seven tons of pig tin, to say nothing colJrS ''^ "^*^"*^ ''''^^^^ ^y ^^ limitation of the Even so rugged and commonplace a thing as a farm wagon IS frescoed with the di^erentiations of taste, custom, section, and makers' pride. The fanner has wasted as much on a manure cart as a rich man on a limousine. If you have thought that fashions in vehicles arrived with auiomotion! consider the niceties of the farm wagon. Going no furthe than die front and rear gears, it was found that there were almost as many models as there were coal-tar dyes. One manufacturer reported 1736 varieties of gears. Think of the frozen capital the inert material, the dead storage space, the superfluity of cataloguing, the cumbersome complexity 4 i \ ll *1 *( ) . 222 INDUSTRIAL AMERICA IN THE WORLD WAR of production, and the deep crust of useless cost all this involved. A critical examination and review showed that sixteen patterns was the outside limit of necessity. A like scrutiny showed that the fastidious farmers pain- fully chose their plows from three hundred and twenty-six sizes and styles; seventy-six were found to be an abundance. They had hesitated over the niceties of seven hundred and eighty-four drills and other planting machines, whereas it was found that twenty-nine would plant all the crops without the loss of an acre or a bushel. In buggies there were two hundred and thirty-two varieties of wheels; four were enough. There were even one hundred kinds of buggy axles, and one would do. And this is only half the wagon and buggy story. The horse-drawn vehicles were as good and as plentiful as ever after these prunings, but there were thousands of tons of steel more for war and a tremendous saving of time, space, transportation, and man power. In a country of the size and consuming capacity of the United States, many a mickle piles up a mountainous muckle in short order. Take so simple a thing as trace chains. When the Conservation Division began to operate on them, it was found that there were five hundred and four varieties; seventy-two were enough. The twist links and copper finish were eliminated. Insignificant, you would say — these changes. Are eighty five-thousand-ton cargo ships, for which the steel could thus be provided, insig- nificant? Cutting out the fads in pocket-knives reduced the catalogues of manufacturers from six thousand items to one hundred. Just the saving in the bulky catalogues that fill parcels-post sacks and express cars was enormous, not only for the makers of pocket-knives, but for all industries. Similar paring throughout the hardware trade made it possible for one great wholesaler to reduce by more than half the ninety thousand items in his encyclopaedic catalogue. Reducing bicycle designs and stripping them of furbelows saved 2265 tons of precious steel. A like process in motor- cycles indicated the saving of six hundred tons of steel, nine tons of alumimmi, thirteen and a half tons of brass, twelve and a half tons of copper, and twelve tons of rubber. By I REDUCING AMERICA'S SURPLUS TISSUE 223 taking the tin out of children's toy carts and the like, seventy- five thousand pounds of pig tin were saved, and by changes in packing, the freight space of 2325 cars was in the way of being saved. The clock industry was restricted to four alarm clocks, one style of mantel or hanging clock, and two sizes of clock watches. Brass writing pens were abolished, and the styles of steel pens reduced from one hundred and thirty-two to thirty. Eliminating the dozen-package saved 1,800,000 boxes. By reducing the proportion of tin used in Babbit metal for bearings and by using cadmium instead of tin for solder, three thousand tons of tin were to be saved in a year. Reforming the tinfoil industry saved one thousand tons of tin; that of collapsible tubes, about five hundred tons; of silverware, a like amount. The completion of the plans for substituting other material for tinplate in the making of tin cans and other containers would have saved 4680 tons of pig tin and 450,000 tons of tinplate. The Conservation Division overlooked no economy between the cradle and the grave. Baby carriages were standardized, and the vanity was stripped from coffins. Brass, bronze, and copper caskets were tabooed, and the styles and sizes of steel caskets much curtailed. Even the varieties of wooden coffins were reduced eighty-five per cent. The labor-saving was thirty-five per cent, and in a full year the materials savings would have been 6000 tons of steel, 285 tons of tinplate, 275,000 pounds of copper, 90,000 pounds of brass, 74,000 pounds of bronze, 70,000 pounds of pig tin, 17,000 pounds of nickel, 2200 tons of coal, and 212,000 yards of wool fabrics. Attention was early concentrated on the necessity of saving wool. The purchases of wool for the army alone exceeded in 1918 the ordinary annual consumption of wool by the entire population, and sixty-five per cent of the raw wool had to be imported. In a lesser degree it was necessary to con- serve all clothing fabrics. In men's clothing twelve to fifteen per cent of yardage was saved by eliminating flap and out- side pockets, shortening the lengths of coats, narrowing the width of facings, etc. Also, each manufacturer was restricted to ten models of sack suits. Boys' suits models were reduced to three. k: M i.««!i •i 'm\ I ! 224 INDUSTRIAL AMERICA IN THE WORLD WAR Reference has been made to the economies effected in women's garments. Wool was ruled out of shawls and robes, and colors of sweaters were limited. These and other modi- fications reduced by one third the quantity of wool consumed by makers of knitted textiles. Felt hats were limited to ten colors for men and twelve for women and children. Of stiff straw hats only six combinations and dimensions were permitted. This programme reduced one manufacturer's samples from four thousand to one hundred and forty-four. The husbanding of textiles was carried back even to the designs and qualities of the goods. The excessive number of designs, for most of which there was small demand, caused the accumulation of enormous amounts of goods in the hands of manufacturers, wholesalers, and the cutting-up trades. Frequent changes of the patterns restricted the total output of the textile machines. Large patterns were wasteful in the cutting. Great savings were effected by limiting the number of designs and sorts of goods. It was found that, by reducing the weight of cloth and mixing reworked wool and long staple cotton with the virgin wool, the latter could be made to go much farther. The reduction in the number and sizes of samples — a seemingly insignificant item — provided cloth for 900,000 uniforms. Leaving the shine off certain rubber shoes saved 30,800 gallons of varnish. Taking the "frost" off automobile tires released considerable quantities of caustic soda to necessary uses. War is a great consumer of leather. Of shoes alone the army purchased during the war more than twenty-nine mil- lion pairs. At the same time the shortage of shipping resulted in a reduction of the imports of hides by nearly forty per cent. An untimely fashion decreed high boots for women and of many colors. The uppers were shortened, colors were limited to white, black, and tan, and new lasts forbidden. In consequence there was a great saving of all of the elements of boot and shoe production. In general, "lines" carried by manufacturers were reduced about two thirds. Incidentally, it may be said that these economies had nothing to do with the standardization of shoe prices, which was about to be applied by the War Industries Board when hostilities ceased. Substitution was never carried so far in this country as iM< REDUCING AMERICA'S SURPLUS TISSUE 225 in Germany, but wood and paper replaced metal to a very large extent, and plentiful zinc was often made to do in place of scarce steel and copper. Many of the substitutions are still with us, and always will be, for in breaking up trade traditions and customs it was found that there were many methods and many kinds and uses of materials that were based entirely on habit and custom. It was also discovered that many of the accepted "can'ts" of industry were only "had-not-been-dones." The effects of conservation met the citizen at every turn. Besides the articles and commodities mentioned, the bed he slept in, the chinaware of his table, the chairs of his home, the paint on the house, the desks of his office, the hose of his lawn, his electrical instruments and implements, the utensils of his kitchen, the roof of his home, the stove in his kitchen, the furnace in his basement, his talking machine, the books in his library, and many other of the impedimenta of daily life were affected by the conservation programme. To pursue the trail of simplification and substitution further would be wearisome for the ordinary reader, but he perhaps will understand from what has been said that it soon became an absorbing game with the war service committees of the different industries. They suggested and defined the schedules of changes in their respective businesses. For the first time manufacturers had a chance to strip off the parasitic infestations of production. They were amazed and fasci- nated by the results. It is said that the economies in the horse-drawn vehicle business thus inaugurated have put profit and new vigor into it. All manufacturers learned a lesson under the tutelage of the Conservation Division that is now standing them and the country in good stead. They are armed with the knowledge and experience to meet the demands for lower prices in a time when competition in prices is more important than competition in varieties of styles and novelty of appearance. Conservation was applied chiefly to goods intended for civil use, but in many instances standardization was so applied that the goods were suitable for either civil or mili- tary use. It was apparent, however, that there was a wide field for conservation in the manufacture of military goods. > w ill I • 226 INDUSTRIAL AMERICA IN THE WORLD WAR To a certain extent such conservation did result from the insistent pressure by manufacturers and various agencies of the War Industries Board for the elimination of refine- ments and excessive margins of safety and strength for which the military had a great fondness even at the cost of delays in development, slow production, and an unnecessary waste of material. Plans were being matured, just as the armis- tice came, for a general standardization of army and navy goods that looked to uniformity of design and reduction in the number of models wherever possible. These plans also contemplated a degree of uniformity between civil and military goods. It was one of the inevitable failures of the supply of the army in France that there was such a variety of models and sizes of almost every sort of army equipment. One outcome was that there was a great waste of transport and storage space. There was also a waste of precious time in designing and producing so many differ- ent sorts of equipment, and a considerable confusion in dis- tribution. The army tended to elaborate just when the civil population was simplifying, being obsessed with the idea that perfection and completeness of equipment were of more importance than time. This was partly the result of the observation of the advantage of superior equipment which the Germans had in the earlier stages of the war, partly of the conviction that the climax of the war would come in 1919, and partly of the abundance of funds suddenly placed in the hands of oflScers who long had been stinted and cramped in the acquirement of equipment. While the general policy of the Conservation Division was one of pruning rather than of cutting industries back to the roots, several lines of conservation sometimes converged on one industry, and in such industries, as well as in some others, the use of whose products could be deferred, there was a positive limitation of output. The automobile indus- try was an enormous user of steel, and there was but small opportunity to economize it by substitution or standardiza- tion. Moreover, much of the steel was of the high-grade alloys, which were scarce and imperatively necessary in ordnance. The associated tire industry normally consumed seventy per cent of all the rubber used in the United States, REDUCING AMERICA'S SURPLUS TISSUE 227 and it was important to reduce the imports of this commodity because of the large amount of shipping needed to bring it from the distant sources of supply. Another factor was the need of conservation of gasoline. Still another was the large amount of skilled or expert labor absorbed by this industry. Finally, as the industry was one on which the equipment of the army and navy with aircraft and with vehicular transport largely depended, it was felt that there was little danger of disorganizing it by limiting the output for civil use. The automobile problem was one of the conservation fields which became a problem for the War Industries Board as a whole, and even involved other major war agencies, as did all of the conservation problems which involved curtailment. Even in the narrower sense of the husbanding of materials and facilities, the conservation work overlapped and inter- locked with other functions of the Board. In truth, the whole Board organization was marked by overlapping of functions. When Mr. Baruch became chairman, he saw at once that this might be either a strength or a weakness, depending on the attitude of the personnel. Each executive was expected to pursue his duties with this fact in mind, so that there would be no friction over authority disputes. So broad and tolerant were the various executives, and so little concerned in winning individual honors, that an unparalleled degree of harmony and helpful cooperation was realized, with the result that each department was greater and stronger than it would have been in hard-and-fast functional isolation. The Conservation Division was full grown and highly efficient before it was incorporated into the War Industries Board, but after the merger it had virtually the whole of the War Industries Board's machine at its command, and was enabled to view and practice conservation as the complement of the other activities of an agency whose field was becoming the whole of industry. The amazing thing about the harmony that pervaded the organization was that the executives were all strong, forceful, and outspoken men. Mr. Shaw, for example, was disap- pointed by the selection of Mr. Baruch for chairman of the Board, and bluntly told him so. Although they had been in > I »5 \i '■ IM ' 228 INDUSTRIAL AMERICA IN THE WORLD WAR the Government service for a year, under the central authority of the Council of National Defense, they were barely acquaintances and each knew little of the other or his work. Shaw spoke as an impartial critic and not as a partisan. Baruch in no way resented Shaw's position. On the contrary, he asked Shaw to remain at the head of the Conservation Division and assured him that he would have in his work all the authority that he (Baruch) and the Board had. Then the two men sat down and amicably discussed the points of Shaw's objections to Baruch as chairman. The outcome was that Baruch "sold" himself to Shaw "in principle," as the diplomats say, and subsequent experience applied the principle. The success of the Conservation Division illustrates one of the advantages among some disadvantages that a democ- racy has over an autocracy in an emergency. Shaw, a per- son unknown to the Government, had an important idea and a studied knowledge of how to apply it. He and his idea were appropriated by the Government within twenty-four hours after he had come into contact with members of the Council of National Defense. This idea of conservation without exhaustion or destruction, through the voluntary cooperation of the men and industries affected, was so well applied that there is no question that conservation was more judicious and efficacious in the United States than in other countries engaged in the war. As applied here, civilian economy of men, materials, finance, and facilities was a means of strengthening the morale as well as the physique of the Nation. The Economic Intelligence Section of the Division kept it informed of conservation practices in Germany, France, England, and other countries engaged in the war. The reports from Germany were as significant in the latter months of the war of that country's impending economic collapse as Foch's bulletins were of her military debacle. Monthly analyses of German uniforms foretold the army in rags; the increasing number of "duds," or dead shells, told of the growing inefficiency of the German projectile factories. Other reports unerringly showed that the German steel indus- try was reaching the end of its rope. A chart was kept up 1 REDUCING AMERICA'S SURPLUS TISSUE 229 to date which reflected all obtainable information as to the supply of raw materials in Germany. Month by month the quantities sank, and the inevitable end was seen coming nearer and nearer. A prediction based on this chart and favored by luck foretold the precise day of the signing of the armistice. What civilians did resentfully under compulsion elsewhere, they here did cheerfully as a high privilege. Lord Reading was so much impressed by the American plan while he was in this country that it is believed that had the war lasted longer Britain would have adopted it, and some of the great industries of England applied it to themselves, of their own initiative. Although in Canada the Government had direct powers of compulsion in effecting conservation, it elected to adopt the Shaw idea of "aid and consent." The conservation work was conducted with remarkable coolness of judgment at a time when passion ran high and public opinion was cyclonic. There was a clamorous demand for heroic measures. Many earnest patriots could not toler- ate the continuation of any business that savored in any degree of luxury or dispensability. They had no thought for timeliness or the complexities of industry and the weak- nesses of human nature. They did not consider that to crush an industry before the time had arrived in which its per- sonnel could be transferred to other activities, or its materials economically applied elsewhere, was to injure the economic body and result in waste instead of economy. They did not realize that the humble worker could not always be expected to take the broad and impersonal view that they had. They could not understand that to take away from such a man the opportunity to spend his earnings in amusement and on baubles was to deprive him of the incentive to labor. These were the people who were always appealing to the Government to do, "for God's sake," this or that drastic thing. They had a sort of tragic conviction that the Nation must gash and torture itself to prove its gravity and attest the solemnity of the hour. Parkman tells us how the rela- tives of deceased Indian warriors ostentatiously mutilated and racked their bodies to attest their sorrow. Some such thought of proof of national sense of affliction was vaguely ! I 230 INDUSTRIAL AMERICA IN THE WORLD WAR ^rw 11^ I I I.; 1 in the minds of the emotional "forgodsakers." The Conser- vation Division was unmoved by such appeals. At the fitting time it acted with the balanced judgment and cool precision of a surgeon in the operating-room. It used the knife, not to punish or to avenge, but to conserve. The World War was a wonderful school, but it gave too many lessons at once. It showed us how so many things may be bettered that we are at a loss where to begin with perma- nent utilization of what we know. The Conservation Division alone showed that merely to strip from trade and industry the lumber of futile custom and the encrustation of useless variety would return a good dividend on the world's capital. It was an amazing proof of what can flow from a detached scrutiny of industry applying the criterion of utility and efliciency. It is, perhaps, too much to hope that there will be any general gain in time of peace from the triumphant experiment of the Conservation Division. Yet now the world needs to economize as much as in war. In this country it is the savings of the producers rather than those of the consumers that accumulate new capital. Our savings deposits make a sorry showing by the side of those of some other nations, but in no other country do the producing agencies store up capital as they do here. It has been calculated that only one third of the war profits of the great American industries reached the pockets of individuals. Outside of taxes, the rest went into surplus and undivided profits; that is to say, capital. The individual spent his large earnings and profits freely during the war and sold his Gov- ernment bonds afterwards, so that there was little gain from individual thrift. The Conservation Division opened up a vast field for the exercise of producers' thrift, but to preempt this abundant source of new capital implies such a close and sympathetic affiliation of competitive industries as is hardly possible under the decentralization of business that is compelled by our anti-trust statutes. It would seem possible, however, and it is emphatically advisable, that the Government should have some close and intelligent liaison with business that would keep it fully informed as to how in another emergency the experience of the Conservation Division could be applied quickly and intel- REDUCING AMERICA'S SURPLUS TISSUE 231 ligently and thus contribute greatly to the expedition and effectiveness of industrial mobilization. We know now that another great war may be won or lost by celerity of indus- trial mobilization. To know beforehand just how the com- munity should strip and adjust itself for the test of combat would be a factor of the first importance. It may be that we are coming into a period of international disarmament. Should that be the case, facility of industrial mobilization will be greatly enhanced. A show-down between disarmed nations will be one of potency to arm after the break comes — and nobody has yet had the temerity to say that disarma- ment is insurance of peace. i\ CHAPTER XII '» I CONVERSION: THE METAMORPHOSIS OF INDUSTRY What France learned — Our own peculiar problem — Making haste slowly Converting regions as well as plants — Should our industries have been pooled with the Allies'? — The early days of conversion — Peek arrives Otis goes into action — He converts Baruch- The regional system is bom — Conversion by long-distance telephone — Applying the continental vision of industry — Those who also served — Graphic forms of conversion. In the World War cavalry became footsoldiers and trudged in the mud of foot transport. Marines fought far from their ships. Paris taxicabs shifted Gallieni's army to the undoing of von Kluck. London buses figured in the supply of the British army. Engineers dropped picks to take up weapons. Naval guns moved on railway trucks and behind gasoline tractors instead of on warships. Soldiers spent more time with pick and shovel than they did with arms, and riflemen discarded their favorite weapon to become grenade-throwers. Throughout the military forces there was adaptation and conversion. Likewise the industrial army had to be nimble on its feet and mobile in function. No nation could keep in reserve the infinitely specialized facilities and sufficient stores of the supply side of such a war. In truth, its demands were fore- seen only dimly. The French were, as always, artillery specialists. Yet they calculated that thirteen hundred rounds a day each would be the limit of consumption of ammunition by the 75's. There were days when single guns of this caliber fired four thousand projectiles each. At the beginning of the war the French were making only fifteen thousand such projectiles daily, but the output had to be pushed up until It was at the rate of 8,400,000 a month. The entire French supply of artillery shells of all calibers was 5,000,000 at the begmnmg of the war, but before the end the monthly pro- duction was 9,000,000. In the final ofi"ensive of 1918 the French and American armies together shot away 33,000.000 French shells — an average of 272,500 a day. Every litUe THE METAMORPHOSIS OF INDUSTRY 233 shop and even the cottages of France turned to the making of shells. It was by a marvelous conversion and improvisa- tion that France was able to meet the unforeseen demands and stunning loss of a large proportion of its manufacturing industry at the outset of the war. Knowing of this shifting of industrial capacity by France and also by England, conversion early became one of the popular cries in America. And because every piano and talking-machine factory in the country was not forthwith converted to the making of war machines or commodities, there was a general fear that our leaders had not grasped the industrial implications of modern warfare. There were two excellent reasons why conversion proceeded somewhat slowly in this country. One was that it took time to ascertain what conversions were possible and desirable, and the other was that American quantitative manufacture depends more on machines than on workmen. Our workmen are machine- tenders rather than mechanics. To a degree, conversion in England, and more particularly in France, was one of setting adaptable mechanics to doing something other than they had been doing. But you cannot tell a machine to make some- thing else. You must remodel it or replace it with another. A group of French workmen who had been making auto- mobiles could almost on a day's notice begin making air- planes, and might have one done within a few days. The process of making standardized parts for final assembly into a whole is incomparably diff"erent. The factory may be running weeks or months full blast before a single finished article comes from the assembly room. This was one of the things that mystified our people. They would read that factories were "in production," working day and night, and yet there would be no reports of finished goods; and it is not surprising that the public often thought that it had been the victim of deliberate deception. To the layman production means goods ready for use. To the quantitative manufacturer production has a technical meaning as distinguished from development. An automobile company, for example, may spend months developing a new model and may even turn out quite a number of sample cars. That is not production, but, when the plant at last begins 1,1 'C7 y lilt V J r. •i 1 I t f\ 234 INDUSTRIAL AMERICA IN THE WORLD WAR making the standardized parts of the new model in volume, it is considered that the factory is in production, though it may be a long time before a single car is in the hands of the dealers. If there are fifteen hundred parts of a given machine, there must first be made a reserve of each one of those parts, and there will be no completed production if there should be any delay or mishap in connection with any of the fifteen hundred items. Thus, a certain contract may from the standpoint of the manufacturer be considered ninety per cent done before a single completed unit has been shipped. The group of mechanics, perhaps, may have built a hundred machines before the great factory has completed one; but, when the assembly room at last begins to function, the factory may send out in a day more units than the group of workers has completed in a month. Wholesale conversion of manufacturing plants in the early stages of the war would have been as disastrous as too hasty conservation. There would have been a long period of pro- duction of nothing, and doubtless many maladroit conver- sions, necessitating, possibly, reconversions. Preliminary to conversion, it was necessary to make a survey of the resources of the country with regard both to materials and facilities. The Resources and Conversion Section took over the data and work of the old Industrial Inventory Section (one of the first creations of the Council of National Defense) as one means of obtaining its basic facts, and through its regional organization was able to shape the industrial inventory more practically than formerly had been the case, though the armistice came before its revision of old and collection of new data had been completed. Allied to conversion of plants was conversion to war objec- tives of manufacturing centers and regions which, in the haste of placing early Government orders, had been neglected. About sixty per cent of the first orders placed for war goods were given to manufacturing plants in the four States of New York, Pennsylvania, Ohio, and Massachusetts. In value and in tonnage they bulked much larger. The northeastern section of the United States is predominantly the manufac- turing region, and it enjoyed the advantage of being near THE METAMORPHOSIS OF INDUSTRY 235 to Washington. It was but natural that each of the score of Government purchasing agencies should instinctively turn to this region, and there being virtually no thought of the relation between the total volume of the twenty sources of orders and the productive capacity of the favored section — flowing from a lack of centralized control of buying — an overtaxing of every facility of production in this section resulted. Power, transportation, facilities, fuel, materials, labor, and finance were strained to the point of collapse. Long before there was anything approaching an authori- tative and general control of the creation and utilization of facilities the condition had become inextricably snarled. There was not only that general congestion of the northeastern section, but there were innumerable local entanglements in and out of that section. The diflferent supply agencies of the army, the navy, the Shipping Board, had placed orders with- out reference to or thought of each other. The result was that there was not power, fuel, transportation, or labor enough to go around. Thus orders were many times placed where they never could be filled. Each agency counted on all the local factors of production as available for itself, not know- ing that other agencies were doing the same. Even when they were aware of their conflicting plans, the responsibility of each officer for the success of his own job drove him to plan and strive for his own. In this way many brilliant individual achievements in procuring production were at the cost of bitter failures. The topic of conversion touches on the interesting question of whether the whole matter of America's industrial partici- pation in the common war against Germany should not have been treated entirely as one of coordination, in the sense of complementation and supplementation, of American industry with that of the Allies. This is a subject that popular dis- cussion of the war has hardly ever touched, and students of the economics of the war have not given it more than a passing thought. It will, therefore, come as a surprise that some army men are of the deliberately formed opinion that the greatest mistake of American military-industrial policy — a mistake that is characterized as a blunder that cost billions and hobbled the Allied power — was the failure to 11" ii I f 236 INDUSTRIAL AMERICA IN THE WORLD WAR deal with American industry as a complementary part of Allied industry instead of as an integral industrial unit. What is meant is this: The Allies, especially France and England, had built up the specialized war industries of their countries, during three years of intense effort, to such a point that their capacity was beyond the demand. They reached the peak of production after their armies had reached the peak of numbers, and of consumption. These industries had already made up the ordnance and munitions deficits of the first years of the war, and when we entered the struggle they had only to replace wastage and current consumption by armies which were declining in numbers. The French army, for example, reached its maximum strength in July, 1915, when it was almost 5,000,000 men. By the spring of 1917 it had declined to 4,400,000, and at the signing of the armistice was down to 4,143,000. On the other hand, the munitions capacity was growing steadily. When the war began, France had 3696 75's; at its end, despite loss and wastage, she had 6555. In 1914, the French army had only 288 pieces of heavy artillery; in 1918, 5477.^ But that is not all. The French capacity for artillery produc- tion became so great that it not only made up the enormous deficits indicated and met the current depreciation, but was able to supply ten thousand guns to the armies of the other allies. The French airplane capacity was 62 a month in 1914, and 2068 a mondi in 1918. England was in much the same situation. France, alone, was perfectly competent, with benefit instead of injury to herself, to have supplied all of the artillery and, probably, all of the munitions, for an American army of any size that could have been sent to France. From the viewpoint of the industrial capacity and efficiency of the Allies what the addition of millions of American soldiers to the Allied armies required was not more facilities for the manufacture of war goods, but of more materials for existing facilities to utilize. Because we could not sooner get our ordnance and munition plants into production, the American army in France did, in fact, fight wholly with French guns and projectiles and largely so with ^These and preceding figures regarding French ordnance and munition production are from M. Andre Tardieu's book. The Truth About the Treaty, THE METAMORPHOSIS OF INDUSTRY 237 I French airplanes. If we had undertaken to provide the materials, the French could have so supplied our armies indefinitely with guns, projectiles, tanks, and airplanes. Instead of following this policy of supply integration with the Allies, we set out to create an absolutely independent supply scheme. Not only that, but we developed a strong tendency to take away from the Allies the ordnance and munitions plants that they had built up in this country. For months plants that had been producing for the Allies pro- duced for nobody. Those who hold that the failure to fuse our industrial efforts and capacities with those of the Allies was a great economic blunder point out that had we done so there would have been no necessity for the tremendous dis- turbance of the normal industry of this country that resulted from conversions and the creation of new facilities for the manufacture of ordnance and munitions. It is further pointed out that we should have been saved the vast expenditures in such plants, which the unexpectedly early termination of the war rendered practically futile. Certain specialized war goods — for example, explosives — would have been made in this country on a tremendous scale, under a programme of inter-Allied economic coordination, but for the most part the contribution of American industry to the war effort would have been an increased production of what it was accustomed to produce, with a saving of much of the loss of time, energy, and money spent in conversion and on new plants. Again, the army would have been relieved of the tre- mendous burden of the complex ordnance problem, involved in the virtual creation in this country of a mammoth new industry, and thousands of officers, enlisted men, and civilian personnel would have been released for active service. We spent about $7,000,000,000 for ordnance, a large part of which represented amortization of plants, and still, because of the brevity of the war, fought it with French ordnance, outside of small arms and machine guns; the latter being, by the way, one of the things that we should have made in this country under the coordination plan. To admit that the omission to integrate our industrial effort with that of the Allies was a blunder would not be to M i 238 INDUSTRIAL AMERICA IN THE WORLD WAR r • ^ i H f *, 1 ' 1 •i 1 II ^r I- u say that it was avoidable. National pride might have moved public opinion successfully to oppose such an undertaking, and there undoubtedly would have been clamorous opposi- tion to the expenditure of vast sums abroad that might have been spent at home. Even the wise arrangement by which the gap in domestic production was filled by having the Allies, particularly the French, provide guns, projectiles, and airplanes for the first two million men has been persistently represented as the imposition of an intolerable burden on an already overtaxed France. As a matter of fact, it was a positive benefit to that country. One of the principal objections to the production of Ameri- can munitions in Europe was the necessity of transporting the bulky raw materials overseas. It would have meant vastly increased shipping. In the case of powder, from ten to twelve pounds of raw material would have to be transported to produce a single pound of finished powder. For artillery and shells the ship- ping demands would have been still more serious. It is also to be said, in direct opposition to the contention that the neglect of Allied industrial integration was a pro- found error, that there was always a menacing possibility that France might have been inundated by the Germans, and her industrial potency annihilated, leaving America, had Allied economic unity been eflfected, without facilities at home or abroad with which to continue the contest. The present writer's judgment is that, while the early termination of the war undeniably resulted in a tremendous loss because of the lack of coordination between American and Allied industry, it would have been most unwise to have assumed that the war would end as soon as it did. However, this was a matter of national and military policy that was entirely outside the domain of the War Industries Board. It had to operate under an adopted plan of inde- pendent equipment and supply of the American armies; but it did concern itself with Allied economic cooperation adapted to the chosen policy, and it was always ready to hold back American preparation when to do so strengthened the hand of the active armies of the Allies. When the War !i THE METAMORPHOSIS OF INDUSTRY 239 Industries Board came into its own, it had a herculean task in the internal coordination of American industry. It goes without saying that conversion of industries began as soon as the war began, but for a long time it was not a considered policy. It was a hit-and-miss affair of individual initiative by civilians, army and navy officers, and various sections of the War Industries Board. There were no guiding channels. Manufacturers who wished to engage in the pro- duction of war goods came to Washington and were caught up in an endless game of tag that led them from bureau to bureau and finally dropped them spent and angry. Some- times a manufacturer would have the luck to stumble into an office that was crying for the help he could give, but in most cases the offer and the need did not join. Moreover, the whole field of industrial adaptation was dependent on the slow formulation of a programme of projected requirements. It was not until late in November, 1917, that the War Industries Board got to a definitive decision with regard to the orderly study and direction of conversion. It then re- solved to create the office of Industrial Representative, and Mr. George N. Peek, then vice-president of Deere & Com- pany, Moline, Illinois, was appointed such representative by Chairman Willard, on the advice of Mr. Legge. The duties of the industrial representative were defined as advising with Government agencies regarding the location of new facilities and the diversion of existing ones from their accustomed activities; to cooperate with industries to procure necessaries for war and for public welfare, and to study "future war requirements and from time to time make such recommenda- tions to the chairman as the exigencies of the situation require." Mr. Peek's function included conversion, but was more extensive. He was to be a sort of generalissimo of industry under the War Industries Board, to direct the con- version, the conservation, and the sagacious concentration of industrial facilities, old and new, keeping in mind the dual purpose of efficiency for war and public welfare and preser- vation for peace. Mr. Peek reduced his problem to its simplest terms, and decided that its solution required the convergence of require- ments by the Government in a central agency in touch with t s 240 INDUSTRIAL AMERICA IN THE WORLD WAR ^ authorized committees of industry. The complement of the committees of industry would be specialized agencies of con- tact on the part of the central agency, which was, of course, the War Industries Board. The specialized agencies were the commodity sections, which had their beginnings in the subdivisions of the work of the Committee on Raw Materials early in 1917. This committee, it should be remembered, never identified its own fimctions with those of the coopera- tive industrial committees with which it worked. It worked with and through the committees of industry, but they were not its committees. As has been pointed out before, this early idea of special- ized Government representatives, dealing with particular commodities in contact with authorized representatives of the corresponding industrial groups, was the alpha and omega of the final form of the War Industries Board. It was sim- plicity itself, but it took a year for it to come into domination of the War Industries Board, and then only when the chair- man of the old Raw Materials Committee became chairman of the Board. Mr. Peek contributed powerfully to the advancement of the idea of specialized contact between Gov- ernment and grouped industry, but, owing to the drifting status of the Board for several months, following his appoint- ment as industrial representative, it was not possible posi- tively to accomplish much in the direction of ordered conversion. In the reorganization of the Board by Mr. Baruch, Mr. Peek was made Commissioner of Finished Products, succeed- ing Mr. Brookings, who became chairman of the Price-Fixing Committee. In this capacity Mr. Peek had an opportunity to apply directly his ideas of the joining-up of Government purchasing and supply agencies with corresponding commit- tees of industry — through commodity sections and war service committees. At the same time the reorganization gave opportunity for the development of the functions that had been entrusted to Mr. Peek as industrial representative. They remained under his general supervision, but were particularized. It should be remarked that the title of Commissioner of Finished Products was somewhat of a misnomer. This p 5 o Pi o » Q < O pq H Pi H O OQ H Q O Pi Q W CO I i1 INTENTIONAL SECOND EXPOSURE I I 240 INDUSTRIAL AMERICA IN THE WORLD WAR authorized committees of industry. The complement of the committees of industry would be specialized agencies of con- tact on the part of the central agency, which was, of course, the War Industries Board. The specialized agencies were the commodity sections, which had their beginnings in the subdivisions of the work of the Committee on Raw Materials early in 1917. This committee, it should be remembered, never identified its own functions with those of the coopera- tive industrial committees with which it worked. It worked with and through the committees of industry, but they were not its committees. As has been pointed out before, this early idea of special- ized Government representatives, dealing with particular commodities in contact with authorized representatives of the corresponding industrial groups, was the alpha and omega of the final form of the War Industries Board. It was sim- plicity itself, but it took a year for it to come into domination of the War Industries Board, and then only when the chair- man of the old Raw Materials Committee became chairman of the Board. Mr. Peek contributed powerfully to the advancement of the idea of specialized contact between Gov- ernment and grouped industry, but, owing to the drifting status of the Board for several months, following his appoint- ment as industrial representative, it was not possible posi- tively to accomplish much in the direction of ordered conversion. In the reorganization of the Board by Mr. Baruch, Mr. Peek was made Commissioner of Finished Products, succeed- ing Mr. Brookings, who became chairman of the Price-Fixing Committee. In this capacity Mr. Peek had an opportunity to apply directly his ideas of the joining-up of Government purchasing and supply agencies with corresponding commit- tees of industry — through commodity sections and war service committees. At the same time the reorganization gave opportunity for the development of the functions that had been entrusted to Mr. Peek as industrial representative. They remained under his general supervision, but were particularized. It should be remarked that the title of Commissioner of Finished Products was somewhat of a misnomer. This S « 04 « o Q < o PQ H GO « o o 39 H ;j Q O « >n as :l| I .i I r ' 'I •' *i V! • i w ■« i I! l: •A m\\ \i H P m I U ! J* I*; THE METAMORPHOSIS OF INDUSTRY 241 department did not include all finished products; neither did it actually include all of the conversion and adaptation task. C. A. Otis, president of the Chamber of Commerce of Cleve- land, and a banker of that city, was placed at the head of the Section of Resources and Conversion. His selection was another instance of how men with ideas made their niches in the War Industries Board. Mr. Otis had taken the lead in Cleveland, even before the United States entered the war, in a successful endeavor to concentrate in the Cleveland district the making of all the parts and accessories of the characteristic manufacturing products of that part of the country. This work had been prompted by the confusion encountered in responding to the demands of the Allies. The object was to cut out wasteful and time-consuming cross- hauling, and generally to integrate industrial processes not domiciled in a single plant. Such an experience met the requirements of the War Industries Board, for in connection with unit conversion Mr. Baruch was planning to meet the problem of regional congestion of production with territorial decentralization. In a way Mr. Otis and his associates had been building up a little war industries board of their own in Cleveland. Like nuclei all over the country were what the Board needed — not only to promote the diffusion of war industry, but to break up the jam of administrative burdens that was over- whelming the central offices. Under the new organization authority, being definitely placed in the hands of the chair- man in the first instance, was by him conveyed to division and section heads. A step further would be to project authority, not only functionally, but territorially. Thus arose the regional system under Mr. Otis's direction. "I'm sold," said Baruch at the conclusion of his first interview with Otis. The latter then suggested that some great organizer, such as President Farrell of the United States Steel Corporation, be put in charge of the new enterprise. "No, you have the idea, and I think you are the fellow to carry it out," was Baruch's answer. "You get your winter clothes and come to Washington." Otis and Peek worked out the plan of nineteen (later I'fi • M«i h !/ I h> ) •r'^ 242 INDUSTRIAL AMERICA IN THE WORLD WAR twenty-one) industrial regions with an "adviser/' represent- ing the War Industries Board, in each. These advisers were usually men associated with local chambers of commerce and fully conversant with industrial facilities and personnel in their district. They knew men and facilities. They knew what was feasible and what was possible. They had a com- mendable local interest, but it was remarkable how com- pletely they subordinated the local to the general. If the full story were ever told of how these local men sometimes prevented their home-town plants or business men from get- ting Government patronage that they were not competent to handle, a number of gentlemen would find it desirable to seek new habitats. On the other hand, they developed and encouraged worthy local enterprises of conversion or new organization that might never have got a hearing in Washington. Should regional patriotism, however, advocate a steel plant in Salt Lake City or in Maine because there happened to be some convertible buildings on hand or some idle labor available, it collided with the watchful Otis in Washington. Regional integration of industry was one of his great pur- poses — the territorial concentration of the final form of manufacture, with the production of materials, massed labor, ample power, and adequate transportation with a minimum of long hauls and the elimination of cross-hauls. With the coming of the regional organizations the day was gone forever when smooth persons armed with a roll of blue-prints could talk themselves into contracts they were not competent to perform. If they came to Washington, a few minutes' telephone talk between Otis and Trigg in Phila- delphia or McAllister in Cleveland indicated the way out for them. But if the men and the project were genuine, the same quick intelligence started them immediately on their way to business. It was the purest sort of application of private business methods to the Government's business. It was a case of an old friend in the person of Otis asking a friend or acquaintance in Oshkosh or San Francisco or Chicago, "What kind of a fellow is Sam Perkins? Can he change his washing-machine plant into a balloon factory, and if he can is he the sort that can make a success?" It THE METAMORPHOSIS OF INDUSTRY 243 was the informal personal intelligence method of the cama- raderie of business which is worth more than volumes of reports and stacks of card indices. The section,* like so many of the War Industries Board departments, was composed centrally of representatives of the war agencies in addition to Mr. Otis and his staff, the latter being John A. Kling, Charles H. Anthony, Edward F. Buhlman, W. T. Rossiter, and Irving H. Taylor. Each regional adviser had a committee made up of one repre- sentative of each of the principal war industries in his territory, with special members to look locally after priori- ties, production stimulation, and statistical information. As has been shown, they cooperated with regional agencies of the war-making bodies and thus created local war industries boards. Originally conceived of as specially charged with the function of conversion, they were rapidly decentralizing the work of every division and section of the Central Board. The army took up the zone or regional system of decen- tralization. The Shipping Board, the navy, the Fuel Admin- istration, the Food Administration, etc., had their local or sectional representatives in many if not all parts of the country. These local chiefs and the War Industries Board's regional adviser and his helpers began to meet and counsel together. The former soon found that they had a local war industries board to help them in their local work, just as the Government as a whole had the Central Board in Wash- ington. Thus, the whole contact of Government with business was oiled and flexed and articulated. Personal ties were established, aloofness was banished, rigidity and formality were blown away. As in the regions, so in Washington. Otis did not spend his time writing long letters and makirfg tedious reports to the Ordnance or Quartermaster Departments. Unhampered by uniform or rank, he established reciprocal relations of confidence and understanding with men like General Hugh Johnson and General Williams, and so through the medium of business men, talking and acting like business men, indus- try and the Government were brought together in understand- ing, sympathy, and effective effort. The Otis organization aimed at getting the efficient pro- I *f: i I '< . ^ :j*iri '■\k .11 244 INDUSTRIAL AMERICA IN THE WORLD WAR ducers into Government work, keeping the ineflEcient out and distributing the load of production for war over the whole industrial body. It did not, any more than any other part of the War Industries Board, make purchases or let contracts. What it did was to put itself into an unassailable position of being able to send to the proper contracting or purchasing agency men who were competent for the work they sought to do; or, conversely, direct the latter to the men and plants they needed. It thought out for the men in uniform the problems of location in respect of personality, finance, power, transportation, adaptability to conversion, and so on. It thought, too, not from the myopic point of view of Washing- ton on the eastern seaboard, but with the continental vision of all industry. It thought for industry as well as for the Government. The old Washington maze, in which good men were lost for weeks, was destroyed. The manufacturer whose business was being curtailed and conserved into a mere skeleton could now come to Washington and go to Otis, or, locally, for example, to Boston to Stuart W. Webb, and get a quick and intelligent answer to his question, "For what kind of war work is my plant suitable, and do you want it?" On the other hand, if the initiative came from the Gov- ernment, Otis and his organization could summon the right man and say to him: "Jones, the time has come for you to forget Jones. You must lay off making wash-boilers and take to making helmets for the boys in France." To some men it was necessary to say: "It's too bad, old man, but your plant cannot be used. There's nothing for you to do but lock the doors and wait till the storm blows over." Almost invariably the manufacturers took their sentences like Spartans. Their formula of acceptance was something like this: "All right, Otis; that's war. I haven't a complaint. You have given us every chance. We'll shut the old shop up and at least release some good men for essential work." One such man closed up his woodworking plant and devoted himself wholly to selling Liberty bonds during the rest of the war. : \ THE METAMORPHOSIS OF INDUSTRY 245 A by-product of the regional decentralization of the War Industries Board — for the regional organizations came to represent all phases of the Board's activities — was that all over the country there were little knots of business men who got an intimate view of the Government's colossal problems. They became less destructively critical, and began to think that, considering the size and strangeness of its task and inherent limitations of ofiicialism, the war Government was surprisingly efficient. Reference was made in Chapter X to the Facilities Divi- sion, and the reader will experience some confusion of under- standing of the line of demarcation between this division and the Resources and Conversion Section. Both were in the same administrative department of the Board, but they were separate, and yet the definitions of their functions reveal a wide overlapping. In the language of a memorandum pre- pared by Mr. Peek, their common chief, they were "insep- arably connected." In any other than such a loose and adaptive organization as the War Industries Board, they would have fouled each other. The records show that they worked together hand-in-glove. The Facilities Division was more general and the Resources and Conversion Section more particular, but both functioned particularly and generally, and both had to do with the problem of conversion or adaptation. The division special- ized more on the Government's future requirements of facil- ities and on studies of how to meet them. It dealt with the source of demand, and endeavored to modify and formu- late it in the light of what was practicable and possible. It sought to mould new enterprises into conformity with con- ditions. The army, for instance, would say, "We must have additional facilities for making gun forgings." Mr. Bush and his associates would study the proposal first with a view to ascertaining whether any existing facilities could be utilized; and, second, if new construction was necessary, with a view to seeing that it should not interfere in any way with existing plants. Care was taken that the labor supply should not be drawn from going factories, that housing should be adequate, that power could be provided, that local and external transporta- (1 ii(.i u 246 INDUSTRIAL AMERICA IN THE WORLD WAR 'r •■) r) m' >' I- 1 i f tion was suitable, that the proposed location should be out- side of the congested region, that fuel and raw materials were available. In fine, the division sought to avoid errors at the start; its representative in the War Department was cognizant of new projects from the moment of their inception. It was a sort of practical counsellor to the war- waging agencies. The latter stated their requirements in terms of facilities and the former told them how to realize them. This sometimes necessitated a veto of army or navy construction plans. The division did not act positively so much as negatively. It would not, for example, undertake to tell the army where it should place a contemplated plant, but it would tell it where it must not place one. The fact that the Resources and Conversion Section had a regional organization indicated a rough line of division of function. To a very considerable extent the section obtained the data on which the division based its advice, recommendations, and inhibitions, and assisted in their application. The division was more concerned with facility requirements at their source and the section more with converting facilities to the meeting of requirements that were already in the stage of orders. The section had but little to do with new facilities and much with adaptation of old. The one dealt largely with facility proposals emanating from the Government; the other largely with such proposals emanating from private sources. Through the division the need sought its fulfillment; through the section a potential facility was drawn toward a known need. One result of the work of the Facilities Division was that the army, after having drafted thousands of skilled men, was compelled to look to the ranks for labor for new plants, in order to avoid the practice, all too common in the early days of the war, of robbing one plant of its labor to fill up the rolls of another. The division was also instrumental in developing new sources of labor, such as female labor. It contributed to the checking of the merry-go-round of labor which caused hundreds of thousands of restless men to put in a large part of their time traveling from an old job to a new one in a very dementia of mass migration, which congested passenger 1 THE METAMORPHOSIS OF INDUSTRY 247 traffic and turned manufacturing establishments into mere junction points where the victims of the wanderlust changed trains. The writer does not know that any one has ever tried to estimate the labor loss that followed the colossal turnover of personnel in the war industries, but much was wasted at this capacious bunghole that was saved at many a tight spigot. Mr. Bush, with his wide experience as a railway executive and as a manufacturer, had a comprehensive understanding of the interlocking factors and remote reactions of new facilities in the midst of a great tension. As a volunteer he had originally approached the Government's war-time prob- lem from the railway angle, and had early advocated supreme Government control and administration of traffic, instead of Government operation of the railways. He was drafted into Mr. Vauclain's sub-committee of the Council of National Defense on army and navy artillery, was sub- sequently at the head of the War Industries Board's section of forgings, guns, small arms, and ammunition for the last; and in the last months of the war became chief of the Facil- ities Division. His public and private experience peculiarly qualified him for the management of facilities development, which was most intimately related to transportation. The concentration of facilities control in one head, which should have been one of the first things undertaken at the beginning of the war, came at a time when the situation was desperately involved, and the termination of the war soon afterwards found him in the midst of his task. Conversion of manufacturing plants from one sort of goods to another is not a simple thing. If nothing but varying materials and varying machines were involved, it would be different. But to alter to a degree that afi'ects fundamental processes and invalidates the experience and skill of workmen, the specialized knowledge of technicians and the commercial deftness of the manager, is a delicate if not impossible business. Any successful business man will tell you that his "organization" is more important than his plant. An organization turned to an unfamiliar thing is little better than no organization. So conversion, to accomplish one of its ends, of obviating the construction of 248 INDUSTRIAL AMERICA IN THE WORLD WAR fl %m^ i i M: : I :)' new plants, had to determine whether or not proposed con- versions were sound in principle. The carpet manufacturer could not make shells, but he could make blankets and duck. The dredging contractor who was ambitious to make airplanes, but could not, could excavate berths in shipyards. The makers of refrigerators could turn to hospital tables. Horseshoe makers could not make automobile tires, but overnight they could take to making trench picks. The toy manufacturer .thought he could make surgical instruments, but came into his own in packing-cases. When curtailment hit the stove business, it was found that the idle plants could be turned to making grenades and trench mortar bombs, which are largely casting jobs. The corset-maker foimd that he could easily master belts for the Medical Corps and fencing-masks. The piano factories and furniture men got their chance in the fuselages and wings of airplanes. The makers of automobile motors took to the Liberty engine like a duck to water. Even the talking-machine people landed right side up with facilities adaptable for the making of seaplanes. Shirtless shirt factories came in handy for sewing mosquito netting into required forms; and pipe-organ factories, strangely enough, were very good at making mosquito netting. Yacht-makers were excellent on flying boats, and manufacturers of air- brakes found they could master Le Rhone motors. These are but samples out of thousands of industrial adaptations to the requirements of war. The Resources and Conversion Section reversed the old and awkward method of making the American mountain come to the Washington Mahomet. It was taking Mahomet to the mountain. Washington, too, was no longer the monumental puzzle whither men went to help and remained to dodder. The puzzle resolved itself, and gave to each man the key to his part. On the one hand, the new section gave light and leading to the engrossed army and navy ofiicers, and, on the other hand, it guided the resources and facilities of the Nation to orderly concentration on war industry. Like a sorting-table in a fruit-packing plant it received miscellaneous industry in mass and distributed it, according to its nature, to the great tasks in hand. Some THE METAMORPHOSIS OF INDUSTRY 249 industries were preserved for the civilian population, some were virtually suppressed for the period of the war, some were spurred on to renewed and increased activity in what they were doing>, and others were shifted from strong to weak spots in the industrial structure or from dispensable to indis- pensable production. The War Industries Board, as a whole, directed industrial strategy; the Conversion Section concerned itself with industrial tactical evolutions. . ii I CHAPTER XIII 13 >1 l,i|ll J I* 4 I i ' :| i L iv DISBURSING FIFTEEN BILLION DOLLARS: THE INTER- ALLIED PURCHASING COMMISSION The New World succors the Old — A golden key for the Allies — Establishing a central control — Legge's way — The traditional obstacles — Mastering the common problems of supply — A great coalition at work — Fifty-two million dollars for one item — NorthcMe, Brand, Tardieu, and Tozzi. Canning said long ago that he had raised up a New World to restore the balance of the Old. When America threw the weight of her finance and her industry on the side of the Allies, she upset the economic balance between the two worlds. Europe felt for months the tread of her armies, but the world still reacts from the shock of America's economic ofifensive. The troops who poured into France in brown human rivers, filled the gaps in man power, and grad- ually turned the balance of preponderance, were but two millions added to ten millions. In terms of soldiers we contributed to the Allied cause about twenty per cent, but economically we contributed the potency of the wealth of half the world. The result was that all the old channels of commerce and finance were diverted or reversed with an ensuing confusion that still bedevils mankind in its trade relations. America rushed to the support of the Allies her unsapped strength of man power and at the same time she applied her economic power through the arms of the Allies. She not only added her own new armies, but kept the old armies going. There was even a period of hesitation in which it seemed that the one way in which we could render effective assistance was by putting every ounce of our strength into the reinforcement of Allied supply. It was thought that to raise huge armies in this country would be but to divert from the Allies the vast sources of supply they were already enjoy- ing; thus crippling them during the long period before our new armies could be eflfective. The Allies themselves originally inclined to this view, but DISBURSING FIFTEEN BILLION DOLLARS 251 its fallacy was exposed when the British army in the greatest disaster in its history groped its way in shattered fragments back to Amiens, gasping for the reserves that were non-existent. President Wilson, as early as May, 1917, had decided that the American eflfort must be bi-lateral, and m an address to the people in that month he prophetically declared that creating and equipping a great army would be "the simplest parts of the great task to which we have addressed ourselves." In the same address he said that we must not only equip our own forces on land and sea, but that we must supply ships by the hundreds and materials "to help clothe and equip the armies with which we are cooperating in Europe, and to keep the looms and manu- factories there in raw materials; coal to keep the fires going in ships at sea and in the furnaces of hundreds of factories across the sea; steel of which to make arms and ammunition both here and there. ..." We placed the resources of America at the disposal of the Allies on a parity with ourselves, and gave them a golden key to the warehouses of the land in the form of ahnost unlimited access to the credit of America through the medium of colossal loans of such magnitude that they may not be repaid in a hundred years. In doing so we multi- plied their already large drain on our resources and facilities at the very moment that we ourselves were subjecting them to an unprecedented strain. It was very much as if we had authorized the Allies to recruit their armies from our men of military age at the same time that we were raising great new armies. It was evident that there must be some sort of central control; first, to prevent further disastrous competitive con- flicts between the Allies, such as were common before we became a party to the great combat; and, second, between them and us. The latter developed first, by reason of the fact that the Allies had already built up large sources of supply in this country. As has been noted elsewhere, our military men, con- centratmg their attention on their own problem of creating and supplying great armies, took the position that they must be served first. They not only applied this principle with »Vi l| i ({ f r. '•1 i i ,:i J- ' ,1 252 INDUSTRIAL AMERICA IN THE WORLD WAR respect to the current requirements of the Allies, but ruth- lessly took over their plants that were erected for and were in production for the Allies (some of which they virtually had paid for through orders at prices that allowed for amortization of plant costs) on contracts placed before the United States entered the war. They further complicated the situation by preempting the supplies of raw materials, even though those could not be utilized for many months or even longer. The taking-over of plants that had been making projectiles and guns for the Allies, although in some cases a sheer waste of the most profligate kind, was not so serious a matter, on the whole, as it might have been, because the Allies had continuously increased their domestic facilities until they were in excess of their requirements. Nevertheless, the stopping of production for them, long before plants could be utilized for the equipping of the American forces, was a blunder that has never been adequately explained. It resulted in the dissipation of manufacturing organizations that had been laboriously built up and in months of non- productiveness. The most flagrant case, perhaps, is that of the Minneapolis Steel and Machinery Company, which was successfully engaged, in cooperation with a forging plant, in producing British six-inch shells. The works were closed for six months and the organization virtually wrecked. There was no reason why they should not have been allowed to continue on the British contract while "tooling up" for the American contracts. In fact, they were shut down before the ordnance people had even begim to design the shell they were to make for the American artillery. Originally it had been the intention of the Allies to form a sort of committee, sitting in London or Paris, that would primarily determine among themselves the form and pre- cedence of their participation in American supplies. This intention was fully realized by the foreign missions rep- resented on the Inter-Allied Munitions Council in the last few months of the war. The Inter-Allied Purchasing Conunission, as it was called, was established in August, 1917, about the time the War Industries Board was created, and was composed of three DISBURSING FIFTEEN BILLION DOLLARS 253 members of that Board, whose aggregate duties composed the whole field of supply, namely, Messrs. Baruch (Raw Materials), Lovett (Priorities), and Brookings (Finished Products). Although it was primarily designed as an instrumentality of the Treasury, which did not wish to dis- burse money to the Allies faster or in larger amounts than their necessities required as determined by ability to procure goods in this country, its chief function soon became one of industrial management, which inextricably involved it with all the functions of the War Industries Board. It was fundamentally related to the general problem of require- ments, and eventually, in the final form of the War Industries Board, it was affiliated with the Requirements Division. Mr. Baruch, who was then at the head of the Raw Materials Division of the War Industries Board, called on Mr. Alexander Legge, vice-president and general manager of the International Harvester Company, of Chicago, to assist him generally and particularly in his duties as mem- ber of the new Commission. Mr. Legge had had a large experience in foreign trade and was very familiar with American industry. A little later, Mr. Brookings asked Mr. Legge to act in a similar capacity for him with respect to finished products, as the line of separation between raw materials and finished products was a very hazy one. He was then designated as general manager of the Commission. His office equipment at first consisted of one edge of Mr. Baruch's desk. In view of the fact that his duties involved the adaptation of both American and Allied requirements to the available resources and facilities, a member of the British High Commission calculated that his staff" would uhimately comprise many more than the fourteen thousand people of the British Ministry of Munitions. "I might take the fourteen part of that number," said Legge. He was not quite right, but his staff" never exceeded one hundred and fifty. Its smallness was due partly to the fact that the War Industries Board's duties were such that all contracting, ordering, and the supervision of production, mspection and delivery, etc., remained in the hands of the ;i li ' I « f' Li 254 INDUSTRIAL AMERICA IN THE WORLD WAR War and Navy Departments and other bodies. For the rest, it was due to the loyal cooperation of American industry which performed, through its war service committees and other associations, and through individual industries, many of the tasks that would otherwise have fallen to the Board. Owing to the difficulties inherent in the situation of a great industrial nation transforming its productive organization to meet the requirements of war, so radically different from those of peace, the task of the Inter-Allied Purchasing Com- mission would have been hard enough at best. But being without any more real authority in the beginning than any other part of the War Industries Board at that time, it was placed in a very awkward position. There was nowhere else for the commercial and industrial representatives of the Allies to go in their quest of action. They had voluntarily given up their own previous system of buying in this country and they represented Governments which were accustomed at home to having their orders obeyed as much industri- ally as militarily. Yet the Allied Purchasing Commission and the War Industries Board had no authority. All the Commission could do was to argue, beg, and implore the army, navy, and Shipping Board people to let the French have this, the British that, the Italians something else, and so on. It was a maddening position. At first, so far were our military authorities from the cooperative spirit that, instead of releasing to the Allies any of the facilities that diey had taken away from them, they were disposed to (and often did) take possession of any that Mr. Legge might uncover. In effect, we said to our Allies, *'Help yourselves," indicating with a sweeping gesture the illimitable resources of a continent; but at the same time negativing the invitation by helping ourselves first to every- thing in sight. The Inter-Allied Purchasing Commission saw clearly that to sacrifice the efficiency of the armies already contending ^t is pertinent to note here that the total expenditures of the Council of National Defense and the War Industries Board for the war period amounted to but $771^. This included $200,000 for the erection of the Council of National Defense Building, in which the War Industries Board was housed. It is doubtful if any governmental war agencies of similar importance, in any country, operated under such amazingly small overhead. £. K. Ellsworth dis* bursed the funds for both bodies. t ! DISBURSING FIFTEEN BILLION DOLLARS 255 with the common foe in France and elsewhere for the super- equipment of an army not yet in being was a strategic error for the like of which a field marshal would have been court- martialed. In their humiliating task of begging for conces- sions which they should have been in a position to command, members of the Commission had to iterate and reiterate the cogent argument that, if the Allies should collapse while America armed, our armies might have to fight for a landing- place in Europe and continue the war alone. By the cumu- lative results of persistence and repetition, the Commission gradually brought the military authorities around to the view that the war was to be fought not by an American army alone, but by that army as part of a great coalition. Perhaps it was not that our officers were so blind as not to recognize the implications of alliance, but more the bad practice resulting from the lack of internal coordination. Each procuring officer was so placed and bound that officially he could do nothing but grab for himself and his. If in the rush he bowled over associates and allies, it was not his to pause or reason why, but to go madly on with the grabbing. In this sort of procedure, the more efficient the agent, the greater the damage. We here come back to that hydra-headed traditional refusal of the American people to prepare for the future. A small complement of officers who had been precluded from getting ready even in a small way for war was diluted twenty to one with civilians temporarily in uniform whose special, technical, and commercial qualifications only served to make them more efficient than the regulars in the grand game of grab, .each for his own. Under these circumstances it was a harder task to obtain recognition of the principle of equal, if not preferred, treatment of the Allies' economic needs than it was afterwards to fill them. The explanation of the ruthless competition of departments of our Government with each other and with the Allies was well set forth by an energetic and achieving young army officer, who had upset the carefully laid plans of months of another department by requisitioning certain facilities. When Mr. Legge had pointed out to him the consequences of his action, he answered: Is fl fi ^ « r •I! J L i t'^ '^ rit f 256 INDUSTRIAL AMERICA IN THE WORLD WAR *'Well, I guess that is true, but I am put on this job of mine with imperative instructions to get these goods by a fixed date, and there will be* no excuse for me if I go back to my chief and say that it was out of consideration for the other fellow that I failed to deliver. My instructions are to go and get, and I go and get regardless of how it hurts or whom it hurts. I must do it. I have no authority to consider the other fellow's problems." Despite the enormous diflSculties the Inter-Allied Purchas- ing Commission steadily gained mastery of the epic prob- lem of keeping open and enlarging the American sources of supply for the Allies, simultaneously with the satisfaction of the vast new demands of arming America. The problem was blended with the general problem of the War Industries Board. That Board never for a moment subordinated Allied needs to those of the American forces. On the contrary, every effort was made to secure precedence for the requirements of the Allies in all the days while the American armies were training; and later the needs of all the armies of the great coalition were met according to the demands of the common eflfort. A decision by the Inter-Allied Purchasing Commission was a decision by the War Industries Board. It was necessarily a part of the Board's requirements machinery, and when the Requirements Division was set up, Mr. Legge became its head. He was succeeded by James A. Carr as general manager of the Commission, but the work remained under Mr. Legge's general supervision, and, of course, under the authority of the Commission. The manner in which what was originally conceived of as a sort of Treasury advisory board regarding loans to the Allies became part of the warp and woof of the War Industries Board is an illustration of the absorptive and adaptive nature of that body, which was always ready to fit into all the niches and crannies of things to be done, with- out waiting for hint or command. An undone job unclaimed by others was always a signal for initiative on the part of the Board. Could the mood and temper of war-time prevail among people and leaders in peace-time, a general form of government as mobile and as initiative as the War Industries Board would approach the ideal. DISBURSING FIFTEEN BILLION DOLLARS 257 The members of the Commission met regularly with the authorized representatives of the Allies in Washington, thus forming an Inter-Allied Council on American economic con- tribution to the reinforcement of the Allies. So far as the Americans were concerned, there were no intrigues and no finesse in the proceedings of these meetings. And, it is but fair to say, if the representatives of the Allies had at first purposes of promoting individual interests at the expense of their associates, they were soon abandoned. These meetings, daily at first and semi-weekly later, soon became judicial conferences. Each national representative stated his requirements and narrated his troubles with respect to pending orders. Among the literally thousands of articles and commodities the Allies were getting in this country, an immense number were for things of which there was no shortage. In such cases a statement of requirement was merely pro forma, but in the basic commodities and in many sorts of finished goods, where there was a shortage, it became a question of allocating the supply or the facilities pro rata or according to superior need. Each national representative stated the position of his country with regard tp an article or commodity and then the conference discussed the relative importance of needs with the common cause as the sole criterion of judgment. It was no unusual thing for the representative of one nation, after hearing the presentation of the position of another nation, to waive or postpone his own applications. Many of the decisions this council was called upon to make could better have been made, perhaps, with fuller knowledge and understanding by such a body meeting near the theater of war and the governments of the Allies; but it had the advantage of being in the American scene, and of understanding the problems of production and delivery that arose on this side of the water. In Europe the belief per- sisted that the United States was both a huge storehouse of inexhaustible accumulated products and a manufacturing miracle, with transport facilities equal to instantaneous com- pliance with every possible demand. The members of the purchasing commissions of the diflferent countries, who were resident here, understood how diflferent were the facts. They \'l: A li ■)l:il Li w vt m M 258 INDUSTRIAL AMERICA IN THE WORLD WAR knew, too, how their goods, delivered at the seaboard, were forever accumulating in terminal yards and on wharves, for lack of shipping to move them; and why, therefore, it was often useless to press for immediate satisfaction of the direst needs. But the Commission and the War Industries Board, with all the machinery of its functional, administrative, and commodity divisions, was always eager and ready to meet as best the conditions permitted every requirement approved at the conferences. Aside from its function of financial controller of Allied purchases for the purposes of the Treasury Department, the Allied Purchasing Commission was in practice the whole War Industries Board functioning for the Allies. To under- take to follow the detail of the management of the economic recruiting of the Allies in America would be merely to follow through a particular phase of the War Industries Board's work, with this difference that the Commission proper had also to deal, as the guardian of the Allies' inter- ests, with the Shipping Board for marine transport, with the Food Administration for foods and feeds, and with the Fuel Administration for fuels. So far as the materials and facili- ties needed by the Allies fell within the domain of the War Industries Board, and even when without, that body through- out all its parts was the authorized instrumentality of their realization. The relations of the Commission to the purchasing agents of the Allies were analogous to those existing between the War Industries Board and the corresponding agencies of the American war-making media. The agents of the Allies attended to their own purchases just as the army oflScers did. The Commission sometimes told them what they must do and what they could not do, in a general way. It also reviewed their contracts to assure itself that they were not being victimized. They were assisted, guided, and protected, but the Commission did not undertake to pass on the validity of their requirements any more than the War Industries Board sought to tell our army what sort of equipment it should have. They were assumed to know their own business. The Conunission's business was to see that, since they were spend- ing borrowed American money, they were not mulcted, that DISBURSING FIFTEEN BILLION DOLLARS 259 they received the degree of preference they were entitled to, having in mind the end in common, and that their course was made as smooth for them as possible. Beyond those friendly limitations they were free agents and made or marred their own records. Yet the fact that the Inter-Allied Purchasing Commission regulated the flow of credits from the Treasury gave the War Industries Board a general power of direction and manipulation that it did not have over the purchasing agencies of our Government. It had more authority at the source, at least in the way of advice that would command respect. In a very true sense it was the disburser of the ten billions of dollars that the Allies received from the United States. The men who measured the flow of this golden flood had had large experience in big business, but Mr. Legge, for example, was amazed at the colossal buying powers for war. One of the first orders he had to deal with was one for the British Government for $52,000,000 worth of six-inch gun shells. Fifty-two million dollars in one order for one item! When we consider that this approximated one third of the normal annual net earnings of the world's greatest corpora- tion and more than the entire cost of the Revolutionary War, we begin to understand what fifteen billions (including private credits), so placed that it reversed the old inter- national position of credits and debits, meant. The largest national debt in the world before the World War was that of France, which was about $6,000,000,000, virtually all held at home. A single national bond issue of a billion dollars was never known before the recent war, and such an inter- national credit between governments as ten billions would have been considered preposterous in sensational fiction. Is it any wonder that the outpouring of American wealth into the scale pans of the Allies disturbed the balance of the world more than the armed weight of two million soldiers? Yet the War Industries Board, in supervising for the Allies the expenditure of the cost of twenty-five Panama Canals, was attending to only about one third of the total of its work as measured in dollars. All the costs of the Federal Govern- ment since the Revolutionary War were not equal to the amount spent and loaned by the Government of the United iV. M \ r. I* I 1 ,1 u it r^B ;^ / ^'lf,i 260 INDUSTRIAL AMERICA IN THE WORLD WAR States in the World War. In a few months the War Indus- tries Board had to adapt national resources and facilities to a flood of expenditures so vast that it can be glimpsed only by such comparisons. The foreign representatives on the Inter-Allied Purchasing Commission were without exception men of integrity and high ability. Each Government maintained a representative in America with the official title of High Commissioner. In the earlier days of the Inter-Allied Purchasing Commission, Lord Northclifi*e was the High Commissioner of Great Britain. He was succeeded by Sir Charles Gordon, whose representative was the Honorable R. H. Brand. The French Government was represented by a High Commissioner in the person of M. Andre Tardieu, who maintained a residence in Washington and had an extensive and highly trained staff. The Italian Government was represented in the person of General Tozzi. James A. Carr succeeded Mr. Legge as business manager of the Commission, and W. M. Reay, A. L. Bostwick, James C. Leddy, and F. E. Penick acted as assistants. The Inter-Allied Purchasing Commission performed its great work without the slightest hint of corruption, and the efficiency of its performance was undoubtedly on a par with American military cooperation with the Allies. > i I CHAPTER XIV AMERICA AND WORLD WAR ECONOMICS: THE FOREIGN MISSION AND INTERNATIONAL EXECUTIVES Buttressing the world's economic structure — Baruch demands reciprocity from the British — The Foreign Mission lays its plans — The British Government meets Sunmiers — Austen Chamberlain and Winston Churchill cooperate — Seventy-five million dollars saved — Summers takes charge of a meetings Conserving steel for war — The story of two million shoes. So commanding was the economic strategic position of the United States in the Allied coalition that it was inevitable that the American economic control should tend to become that of the whole alliance. Considered as an agricultural, mining, lumber, and manufacturing unit, the United States approached more nearly to self -containment than any other nation. In no other country, available as a base of supplies for the Allies, was it possible for them to satisfy so large a proportion of their needs. In some commodities, such as steel and copper, the Ameri- can sources were virtually the only ones available to the Allies outside their inadequate domestic productions. In other commodities, such as foodstuffs, that were available in large surplusages in distant British dominions and in South America, the extreme shortage of shipping made it necessary to put a tremendous strain on North American supplies, for owing to the shorter route the limited transport facilities could render greater service. Under these arti- ficial conditions the United States, which had almost ceased to be an exporter of meats and wheat and its products, became for a time again an exporter of them in unprece- dented volume. The United States was also the one member of the anti- Teutonic coalition that was in a position to impel the eco- nomic assistance of the politically neutral nations. In the case of the Scandinavian countries, for example, the United States was in a position, as the price of that modicum of supply that was necessary to their existence, to assist in the diversion of such exportable goods as they had, to the Allies, M 262 INDUSTRIAL AMERICA IN THE WORLD WAR il i.i.'. ^ n • (i m I », i I'l ♦ M! and to tighten the embargoes against trade with Germany. In the case of Chile, the shifting of its source of supply of manufactured goods and financing from Europe to the United States made it possible .for the United States to secure control of the Chilean nitrates witliout which the war could not have continued. Thus the United States in reality played a triple economic part in the war. It had to meet its own civil and military needs, an indispensable proportion of those of the Allies, and such part of the requirements of the neutrals as would make them economically contributory to the Allies. In a very large way the United States was the cohesive force which kept the whole economic structure of the world from falling into ruin. In the final analysis the major part of this tremendous task fell to the War Industries Board. When at last the chairman of the Board became the arbiter of priority — that is to say, the allocator of the products of American industry — he automatically tended to become the central, though undesignated, distributing authority of the internationally derived commodities of the entire world out- side of the Teutonic alliance. The growth of this international power and its efficient application necessitated that the War Industries Board should be ably and authoritatively represented in Europe in close touch with the Inter- Allied Munitions Council and with those British agencies which thitherto had dominated the control of certain materials that were obtainable chiefly within the British Empire or were British-owned. Another considera- tion that demanded the projection of the War Industries Board into Europe was the need of far more economical use of shipping in the interest of the common cause. A third was the need of seeing to it that American materials, often supplied to the Allies at the cost of much deprivation and hardship to American industry of a non-war nature, were husbanded and faithfully used by the Allies for war and not for private trade purposes. A fourth need of representa- tion abroad was the conviction that the American Expedi- tionary Forces were calling for or were receiving certain kinds of supplies far in excess of current or reasonably anticipated requirements. Finally, the A.E.F. had need of AMERICA AND WORLD WAR ECONOMICS 263 business advice and judgment in its extensive purchases in Europe, which could hardly be expected to be available to it without outside assistance. It is difficult for Americans to understand that in the fourth year of the World War, and even after the United States had been a party to it for upwards of a year, the British control of production, distribution, and prices was far weaker and much less extensive than like control in the United States. It is something of a shock, too, to find that throughout our first year in the war our Government in its foreign requirements was treated by the British Government precisely as if it were a British civilian in the matter of prices. In such commodities as the British Government had put under price-control there was one price for the Govern- ment and another for civilians and private industry. The United States Government had paid the civilian's price, though from the first the United States had made it an invariable rule that all prices established for governmental buying should also prevail for civilians and for the Allies. The prime purpose of the Foreign Mission was to put an end to this inequality. This purpose was frankly disclosed to Lord Reading, the British Ambassador at Wash- ington. He opined that the Mission was a very disturbing factor in international relations. Mr. Baruch informed him, with the directness of a business man, that the United States could no longer tolerate the continuation of such an inequity as that we should lend the Allies immense sums with which to purchase goods at a restricted and controlled price, whereas we were denied equal price treatment by them. This meant that unless reciprocity were eff*ected American finan- cial support would be withdrawn from the Allies. A further step was the insistence that the British should take under price-control certain important commodities that they were still permitting to run wild. These proposals were unpleasant to the British Government, for the coalition war machinery of England was highly responsive to the power and demands of its commercial interests; and the economic side of the war was considered from a material- istic angle undreamed of in America. It was this fact that accounted for the anomaly of no price-regulation at all '/; 1^ « / i I C I 1 ) ; 1L i\ W >i ' \ 264 INDUSTRIAL AMERICA IN THE WORLD WAR of some scarce commodities and of two prices for others. The American War Industries Board was thus directly involved in British trade and industrial control when it sent out the Foreign Mission. It was a bold and hazardous enter- prise, and Lord Reading was well advised to say that it was a disturbing factor in international relations. It went, how- ever, in no Quixotic quest, but firm of purpose, clear of comprehension as to its objectives, and fully supported at home. Both President Wilson and Secretary of the Treasury McAdoo were whole-heartedly behind the undertaking. There was no chance that the Mission would find itself out on a precarious limb. It was anticipating trouble, but it was well armed. Any one who attempts to interfere with any of the vested interests of John Bull, especially in his own home, will not find interest in life lacking. The Foreign Mission was advised by old heads in European diplomacy that, however much value the indirect and soft-pedaling methods of the tradi- tionally disingenuous manner of dealing with international matters might have in ordinary times, shirt-sleeves diplomacy was precisely the sort for the hour. The Mission, being mostly composed of American business men accustomed to direct dealing and impatient of delays, received this admonition with satisfaction. At its head was L. L. Summers, member of the War Industries Board and technical adviser to the Board, who combined a vast and mobile knowledge of the chemistry, physics, and economics of war, in practical application, with a quick and lucidly analytical mind and abundant energy.^ Chandler P. Ander- son, a lawyer of extensive diplomatic and international experience who enjoyed a personal acquaintance with officials of the French and British Foreign Offices, was counsellor and adviser to the Mission. George N. Armsby, vice-president of the California Packing Corporation, of San Francisco, and chief of the Tin Section and also a member of the Priorities Committee of the War Industries Board, was specially charged with the subject of tin. Paul Mackall, assistant sales manager of the Bethlehem Steel Corporation, was the steel ^Mr. Summers's role in the War Industries Board will be discussed in Chapter XXI. AMERICA AND WORLD WAR ECONOMICS 265 man. A. M. Patterson, president of the Textile Alliance, and chief of the Foreign Wool Section, was the wool authority. Henry W. Boyd, president of the Armour Leather Company, was the leather expert. Arthur D. Whiteside, president of the National Credit Office, New York, a member of the Wool Section, had general charge of the Mission's statistical mat- ters. Edward Allen Pierce, of the brokerage firm of A. A. Housman & Co., New York, was business manager. Lucius P. Ordway, president of the Crane-Ordway Company, of Minneapolis, and a member of the Priorities Committee, was the Mission's representative on the Inter-Allied Munitions Council. John Hughes, president of the American Sheet and Tinplate Company, and member of the American Iron and Steel Institute, was associated with Mr. Armsby on tin. Frederick K. Nixon, president of Nixon, Walker & Tracy, New York, assisted Mr. Patterson in textile matters. Dr. Lincoln Hutchinson, professor of Commerce of the University of California, was the non-ferrous metals expert. Through the President and the State Department, it was arranged that the Mission should have such a diplomatic status that, while having the cordial support of the American diplomatic and war trade services, it would have full author- ity to act directly, thus effecting a saving of time and gain- ing the advantage of forceful contact with the responsible war executives of France and England. The War Trade Board had its representatives, with pleni- potentiary credentials, associated with American embassies and ministers throughout the world, and was in a position to be and was of the greatest assistance to the Foreign Mission. This was especially true in regard to matters with which it had been incidentally dealing before the Foreign Mission took them over. Its representatives knew the ropes and the key men in the Governments of the Allies and the neutrals. Thus there was extended into international relations the War Industries Board's methods of expediting business by direct and frank dealings between Government representa- tives who were experts in their particular commodities and the delegated committees of industries. It was, moreover, essential that, since the chairman of the Board delegated absolute control of the foreign relations of the Board to the ^^.l i i t' If w \ M 266 INDUSTRIAL AMERICA IN THE WORLD WAR Foreign Mission, it should be in a position to acquaint itself directly with all the facts and factors that would determine its policies and practices. Long-winded diplomatic corre- spondence, circumlocution, and procrastination were thus avoided. About the time the Mission sailed, it was found that in a strict legalistic sense the then available funds of the War Industries Board could not be used to defray its expenses. This fact was later discovered by a lynx-eyed member of Congress during one of the gossipy committee hearings that enlivened Executive performance during the war. Judge Albert C. Ritchie, general counsel of the War Indus- tries Board, and at this writing governor pf Maryland, was testifying as representative of Mr. Baruch who was then in Europe. A colloquy something like the following ensued: The Member: "How much did the Foreign Mission cost?" Judge Ritchie: "It cost $63,752.25." The Member: "Are you aware that there was no authority for such an expenditure?" Judge Ritchie: "Yes, sir." The Member: "Have you any explanation to offer?" Judge Ritchie: "There was no expenditure of Government moneys. Under the circumstances there was nothing for Mr. Baruch to do but pay the bills himself. The Mission had to go-" The Foreign Mission aimed at the creation of international executives (as the most satisfactory method of control of a number of commodities of which the supply was insufficient and whose sources were largely or chiefly outside of the United States) similar to the nitrate executive, which had been established previously, as will be related later. The commodities whose control was definitely contemplated in this manner when the Mission went abroad were tin, jute, rubber, manganese, tungsten, leather, platinum, flax, wool. Other commodities were tentatively under consideration. Prior to or aside from the creation of such executives, the Mission sought its ends through contacts with the Inter-Allied Munitions Council, the British economic control committees, the French and British Ministries of Munitions, shipping control agencies, and the A.E.F. The three objects in view : I ALBERT C. RITCHIE HUGH FRAYNE General Counsel of the War Industries Board; Member of the War Industries Boani now Governor of Maryland representing Labor ROBERT S. BROOKINGS Member of the War Industries Board and Chairman ; of its Price-fixing Committee f ' INTENTIONAL SECOND EXPOSURE ^ I I 266 INDUSTRIAL AMERICA IN THE WORLD WAR Foreign Mission, it should be in a position to acquaint itself directly with all the facts and factors that would determine its policies and practices. Long-winded diplomatic corre- spondence, circumlocution, and procrastination were thus avoided. About the time the Mission sailed, it was found that in a strict legalistic sense the then available funds of the War Industries Board could not be used to defray its expenses. This fact was later discovered by a lynx-eyed member of Congress during one of the gossipy committee hearings that enlivened Executive performance during the war. Judge Albert C. Ritchie, general counsel of the War Indus- tries Board, and at this writing governor of Maryland, was testifying as representative of Mr. Baruch who was then in Europe. A colloquy something like the following ensued: The Member: "How much did the Foreign Mission cost?" Judge Ritchie: "It cost $63,752.25." The Member: "Are you aware that there was no authority for such an expenditure?" Judge Ritchie: "Yes, sir." The Member: "Have you any explanation to offer?" Judge Ritchie: "There was no expenditure of Government moneys. Under the circumstances there was nothing for Mr. Baruch to do but pay the bills himself. The Mission had to go-" The Foreign Mission aimed at the creation of international executives (as the most satisfactory method of control of a number of commodities of which the supply was insufficient and whose sources were largely or chiefly outside of the United States) similar to the nitrate executive, which had been established previously, as will be related later. The commodities whose control was definitely contemplated in this manner when the Mission went abroad were tin, jute, rubber, manganese, tungsten, leather, platinum, flax, wool. Other commodities were tentatively under consideration. Prior to or aside from the creation of such executives, the Mission sought its ends through contacts with the Inter-Allied Munitions Council, the British economic control committees, the French and British Ministries of Munitions, shipping control agencies, and the A.E.F. The three objects in view r > ALBERT C. RITCHIE HUGH FRAYNE General Counsel of the War Industries Board; Member of the War Industries Board now Governor of Maryland representing Labor ROBERT S. BROOKINGS Member of the War Industries Board and Chairman of its Price-fixing Committee iWt III Il v\4 >l*|. 1 1 i .•If. ( ) AMERICA AND WORLD WAR ECONOMICS 267 with respect to each commodity were (1) to assist the Inter- Allied Munitions Council in determining the actual needs of the respective nations; (2) to obtain such a control of the sources of supply as would insure a maximum of production ; and (3) to control prices through the elimination of compe- tition among the Allies. Connected with the last was the particular American pur- pose of securing price-reciprocity from the British, whether an international executive was set with respect to a com- modity or not. In all these matters the chief difficulty, as indicated above, was that the British control committees were chiefly private committees of industry acting in a govern- mental capacity and with one eye frankly on their private interests. The committees that controlled these commodities were under the Allied Munitions Council. The Americans took the position that the chairman of the Steel Committee should be an American, and that, in the case of the proposed- intemational executives, the headquarters should be in Washington of such as might be set up in commodities of which the principal supply came from the United States. Everything the Americans contended for was in the nature of insurance that the Allies should act squarely with and reciprocally to the attitude of the War Industries Board, which at all times treated America's economic resources as Allied resources. Probably the only international executive that would have had its seat in Washington would have been that of leather and hides. It does not appear to have been the intention to establish international control in such things as copper and steel, which were overwhelmingly of American origin and, therefore, dominated by the War Industries Board for the general good. Immediately after arriving in London in midsummer, 1918, the Mission asked the various committees of the Muni- tions Council to undertake price-control of various com- modities. This request was promptly rejected by the British chairmen of those committees. The next step was a direct appeal to the British Govern- ment and a declination by the Americans to join the com- mittees until they were thoroughly govemmentalized, their position being that, as official representatives of the American f II iv W 4 J *1 *1 J'H \\ 268 INDUSTRIAL AMERICA IN THE WORLD WAR Government, they could deal only with agencies of like authority. Austen Chamberlain, Minister without portfolio, was put in charge of these matters. He was sympathetic and actively cooperative and the status of the committees was promptly altered, conformably to the American plan. The Americans then joined the respective committees and renewed their request for a new method of commodity con- trol. Again they were denied, and again they appealed to the Cabinet, with plain intimations this time to representa- tives of the Government that this appeal was an ultimatum. Jute, which is an Indian product, both as to the raw material and the textile, was in great demand in the United States for such purposes as bags for nitrate and for wrapping many kinds of war materials and implements, in addition to ordinary uses. The British made the argument that they could not interfere with the free play of the Calcutta market in jute, because the Government of India was separate from the British Government. The American reply pointed the general ultimatum. "We regret to learn that that is the position," said Sum- mers for the Americans, in effect, "because, being under the impression that the Indian Government was subject to the Imperial Government, we have been executing orders from the British Treasury for the shipment of silver to the Indian mints. Now that we learn that the two Governments are independent, we shall feel free to withhold further shipments of silver, assail Indian currency in the markets, and purchase our requirements of jute in the depreciated currency that will result." Mr. Chamberlain saw the point without explication, expressed apprehension that the alternative American plan would create a panic and close the Calcutta Exchange, and asked for forty-eight hours' delay in the inauguration of the alternative policy of getting jute at reasonable prices. The Cabinet at once reconsidered the jute question, determined on Government control of that material, and invited the Americans to be represented on a special board which was established to decide what prices should be. As the Foreign Mission saw the situation. Chamberlain and Winston Churchill, Minister of Munitions, whole-heartedly AMERICA AND WORLD WAR ECONOMICS 269 supported the American contention, but were powerless to take the initiative because of the commanding influence of the Manchester and Aberdeen spinners, who owned the Indian jute mills and were more interested in their profits than in eflScient international control of jute. The ice having been broken, the Americans next succeeded in having tin — which had been controlled, in conjunction with rubber, by a committee of the British Board of Trade, which was virtually a committee of the tin and rubber indus- tries — separated from rubber and placed under an inter- national executive committee. Tin comes principally from the British Straits Settlements and the Dutch East Indies. The tin executive established a price for tin which was enforceable in the Straits and stopped all buying in Batavia. The Dutch refused to meet the executive price, but, being thereafter without a market, their price soon broke to the established level. It was calculated that the new price meant a saving of $75,000,000 a year to the United States alone, to say nothing of the Allies.^ As an actual purchasing agency the Foreign Mission had no authority, for it was simply a subsidiary body of the War Industries Board, which, though it might conduct prelim- inary negotiations as a corollary of its advisory powers, and virtually, if not actually, shape contracts, was without power to execute them. The effectuation of the international execu- tives necessitated firm purchasing agreements on the part of the respective nations. In this emergency the United States Steel Products Company acted most patriotically, and when the tin executive was created bound itself to take and pay for the tin allocated to the United States. Subsequently it delivered this material according to the requirements of the different purchasing agencies of the Government as directed by the War Industries Board, being then reimbursed; but without profit, commission, or pay for its services. The coolness of the British members of the then forming committees of the Munitions Council continued. The Ameri- cans found that, although the completion of their organiza- tion had been delayed pending the arrival of the Mission, ^The results of the Foreign Mission's labors will receive further considera- tion in the chapters relating to commodity sections. iff t > . ¥i 270 INDUSTRIAL AMERICA IN THE WORLD WAR there was no disposition to confer with them regarding the chairmen. They were particularly sensitive regarding the omission to consult with them regarding the chairmanship of the Steel Committee which, they thought, should be assigned to them without question. However, the day of the organi- zation meeting of this committee arrived without any sug- gestion that there should be an American chairman. Mr. Summers was greatly concerned and acted in a manner that was decidedly disconcerting and entirely in the "it-isn't-done" category. He boldly took the chair himself, declared the purpose of the meeting, and announced that, inasmuch as America was furnishing its allies with more steel than their own entire production, the permanent chairman of the committee, in all propriety, should be an American. Accordingly, as chairman of the American Mission, Mr. Summers nominated Paul Mackall for permanent chairman. "There being no objection," proceeded the amazing Summers, "I will declare Mr. Mackall chairman." There were doubtless mental objections aplenty, but none was audible. "Will you kindly take the chair, Mr. Mackall?" proceeded Mr. Summers — and that settled it. Whereupon he left the meeting to Mr. Mackall and proceeded about his other business. That evening the secretary of Winston Churchill, Minister of Munitions, called on Mr. Summers to say that the Minister would be very glad to confer regarding the chairmen of all the committees. It was about this time that Bonar Law while at a dinner- party said to the remarkable head of the Mission: "So you are Mr. Summers? Well, you have been the most talked- about man in the British Cabinet for the past two weeks." The British Government, it seems, naturally hesitated to disturb the aflfairs of the great industrial interests that were supporting the Coalition Government, but when the Govern- ment's hand was forced by the dominating American partner it was relieved of responsibility to these interests. Mr. Summers was so confident of the essential soundness and righteousness of the American position that he even told < AMERICA AND WORLD WAR ECONOMICS 271 Lord Reading that, if necessary, he would go before the British and American publics with a candid statement of the situation. The chairmanship of the Steel Committee enabled the Foreign Mission to find out just how the Allies were utiliz- ing the immense amounts of steel they were receiving from America at the cost of very serious dislocation of American industry. Mr. Summers and Mr. Mackall, now having an official international standing, were in a position to secure reports and personally to inspect steel plants, which they did in both England and France. They were in a position to enforce the use of American steel for necessary war purposes and to see that French and British steel was used in the same way, and not diverted to ordinary commercial purposes. There was a great temptation for the British to use American steel for war purposes and devote their own production to manufacture for post-war trade. Similar intimate knowledge was obtained concerning the disposition of copper and other materials that were being supplied by America at a sacrifice. The British were persuaded to grant their Government prices in their price-controlled commodities to the American Government. In the item of wool, chiefly originating in Australia and South Africa, this amounted to a saving of $45,000,000 on a single order. The war came to an end before any international execu- tives, besides those of nitrates and tin, were established, but the cordial spirit of cooperation that the British controlling agencies developed, afteV a period of stiffness and frigidity, resulted in much the same thing, though a number of other executive committees certainly would have been established. It is only fair to say that, although the Foreign Mission encountered very determined opposition at the start from the business interests that were in the saddle in England, they enjoyed the frank support of numbers of influential persons who freely conceded that the American programme was purely an Allied programme, wholly unselfish and entitled to the support of impartial judgment. Complete consummation of international control, thus creating a monopoly of buying, would have saved hundreds r I i» I » ^ I** J 272 INDUSTRIAL AMERICA IN THE WORLD WAR of millions, if not billions, to the Allies, had the war con- tinued for another year. This saving was important, not only as an item of expense, but in relation to the international monetary situation, as it would have enabled the Allies to keep at home large amounts of gold which otherwise would have been exported in payment of the excess prices. Aside from the concentration of the buying and control- ling power of the Allies, which the Foreign Mission was so contributory in bringing about, it was of the greatest value as a general European relations department of the War Industries Board. It gave our Government what might be called a selling agency in Europe in contradistinction to the buying agencies that the Allies and some of the neutrals maintained in the United States. It gave the Board its own sources of information with which to check the requirements statements of the various high commissions, and thus intro- duced a new factor in the determination of requirements. An illustration of the benefits that flowed from the manifold activities of the Foreign Mission is the story of a contract for two million shoes placed in England by the A.E.F. The British authorities asked for special alloca- tions of leather and other privileged treatment, saying that this contract was a great hardship to their boot and shoe industry. It was awarded to the British factories because it was represented that they could give quicker delivery than American factories, and the price was higher than it would have been for the latter. Mr. Boyd found on investigation that deliveries would not be made even approximately on time and that American shoes of a better quality could be delivered much more promptly. Armed with this information, Mr. Boyd went to France and acquainted the Supply Department of the A.E.F. with the facts and received authority to cancel the contract. When the shoe contract was again used in London as a stalking horse for preferred consideration for British industries, Mr. Boyd created consternation by stating that the Americans, realizing what a burden the shoe contract was, had secured authority to cancel it. And he thereupon handed a can- cellation of the contract to the chairman of his committee. In October, Mr. Legge, accompanied by Pope Yeatman, AMERICA AND WORLD WAR ECONOMICS 273 head of the non-ferrous section, and Irwin H. Cornell, chief of the lead and zinc section, were dispatched to Europe to reinforce the Foreign Mission for a time. The alarmingly growing shortages in some commodities and other changes in the industrial situation in America made it advisable to give the Mission the benefit of authoritative personal accounts thereof. Mr. Legge and his associates took with them a mass of statistics regarding shortages, and other data, but the armistice was signed a few days after their arrival in Paris. The statistics immediately became obsolete, for overnight deficits turned to surpluses, and in the general rush to liquidate commitments the Americans learned that the thrifty Allies had often salted down con- siderable surplus stores of some materials whilst clamoring for more at any sacrifice. Some interesting confrontations followed, amusing to the Americans and embarrassing to the Allies. Just as the Mission was preparing to return to America, Colonel House asked its cooperation in preparing data regarding the industrial status and requirements of that section of France that had been held more or less damaged by the Germans. As the Mission then comprised about a dozen industrial experts, it was well equipped for a rapid survey and hasty recapitulation of the situation, which was promptly made. It remained in Paris until after President Wilson's arrival, but, when it was found that economic questions were not- at the top of the Peace Conference agenda, Mr. Legge and others returned to the United States. He was hard at work in his private afi'airs in Chicago when he received a summons by cable from Mr. Baruch, who had become the President's economic adviser in the Peace Conference, to get together a party of specialists and hasten to his assistance in drafting the economic section of the Treaty. Including Mr. Summers, who had remained in Europe, this staff" of economic experts was made up of Mr. Legge; Dr. Frank W. Taussig, then chairman of the United States Tariff Commission; Charles H. McDowell, formerly Director of the Chemical Division of the War Industries Board; Frederick K. Nielsen, later the Solicitor for the State Department; Bradley W. Palmer, of Boston, a lawyer «:■;«-, -^.'.; ,l'«l 3 t I 'l1 11 Mf 274 INDUSTRIAL AMERICA IN THE WORLD WAR who had been sent to Paris by the Alien Property Custodian; John C. Pennie, of New York, a noted expert in inter- national and American patent law; and J. Bailey Brown, of Pittsburgh, an expert in patents, trademarks, and copyrights. Mr. Baruch and Thomas F. Lamont were the American members of the Economic Drafting Section. Professor Allyn Young, who was independently attached to the Peace Commission, acted as Mr. Lamont's alternate. The work of this section is no part of the history of the War Industries Board, though the American part of it was largely the heir of that body's experience;^ but this reference to it is required in rounding out the account of the Foreign Mission. The Foreign Mission, being in direct and constant com- munication with and in the full confidence of the parent body, the latter was enabled to act in instant response to the varying demands of the war from day to day. It has already been told how American ammonia was traded for Spanish mules, and how, on word from Mr. Summers regard- ing the gravity of the approaching exhaustion of the French projectile reserve in the fall of 1918, the Lackawanna and Carnegie steel mills were instantaneously thrown into the breach with such gratifying results that one more name was added to the list of those who won the war. The work of the Foreign Mission was a giant's stride toward the realiza- tion of the mobile determination and execution of the industrial strategy of war. Sir Philip Gibbs^ relates with what joy the British regiments, "with their backs to the wall" at the northern end of the Allied line in March, 1918, welcomed the French cavalry, galloping their panting horses through clouds of dust, "followed by divisions of blue men in hundreds of blue lorries, tearing up the roads, and forming a strong blue line behind our thin brown line." A little later these men in blue were withdrawn, as quickly as they came, to assist in the first of those hammer-blows on the Marne that *Those readers who may be interested in an intimate account of the origin of the economic portion of the Treaty of Versailles would do well to read The Making of the Reparation and Economic Sections of the Treaty, by Bernard M. Baruch. Harper & Bros., New York. 'Now It Can Be Told. Harper & Bros., New York. AMERICA AND WORLD WAR ECONOMICS 275 shattered the Weltpolitik dream of Germany. So the men of the War Industries Board visualized a centralized contrcl of the industrial resources of. the Allied world, as a swift shifting of industrial divisions to meet the successive crises of the war. To them there was drama comparable to that of the battle scene in the swift shifting of twenty thousand sweating toilers in Homestead and Buffalo, their rows of glowing blast and open-hearth furnaces and their rumbling, monstrous rollers, to the making of steel for the 75's of France galloping to victory if only the shells would hold out. 11 ■^^ 4«C\li^i*«L«^^ T ,^rf-»*.Vr**. I '\ * II Mt Ih i J 1 1 CHAPTER XV THE CONTROL OF LABOR The human understanding of labor — Obtaining workers for war industries — Salvaging waste man power and materials — Gompers in the war — His call to labor — Scrutinizing the I.W.W. — Some early history — The Taft- Walsh Board — The War Labor Policies Board — Employment management — Labor after the war — Priorities in labor. In the preceding chapters we have seen how the War Industries Board practicalized the relations of government and industry by invoking the assistance of capital and management. We come now to an account of how it con- cerned itself with the third factor in production — labor. Following the sagacious example set by the &)uncil of National Defense in making Samuel Gompers a member of its Advisory Commission, the War Industries Board from its beginning had a member charged with the consideration of labor problems, Mr. Hugh Frayne. Very properly, he was of labor, but just as capitalists and managers were used as instrumentalities of the Government in controlling capital and management, so Mr. Frayne's experience and ability were applied to the consideration and control of labor in the triple team of production. Strictly speaking, Frayne was not on the Board to repre- sent labor, but to manage it. There is a labor element in every commodity, a labor factor in every price. Labor is sometimes, indeed, considered as a commodity — as an ingredient of production. But it is unlike other com- modities in that it is vital and human. To get the most out of it, it must be sympathetically and understandingly managed, just the same as with the capitalist and the business man. Labor in the United States is quite as patriotic as the employer, and the patriotic appeal was equally powerful with it, but labor must have its hire, and that was subject to extreme fluctuations during the war. It was limited in quantity; hence it was subject to priority regulations and essentially involved in price-fixing. No THE CONTROL OF LABOR 277 I •' requirements programme could be drafted intelligently with- out due allowance for the labor factor. Conservation could not get far without the cooperation of labor, and the problems of conversion directly concerned the susceptibil- ities of the workers. A War Industries Board without a labor member would have been a very lame and ill-balanced agency. It would have fallen into a capital error, com- parable to that of the Food Administration, which dealt with feeds and foodstufi's without taking the farmer into its decisive counsels. The creation of the War Labor Administration, with the Secretary of Labor as administrator, prior to the reorganiza- tion of the War Industries Board, in the spring of 1918, made unnecessary the setting-up of any administrative machinery for labor matters within the Board. Mr. Frayne was, therefore, relieved of a burden of administrative detail that would otherwise have fallen to his office. He was free to meet the labor problem at the source, and prevent friction by foresight. And he had the leisure to emphasize the labor factor in all the industrial contacts of the Board. He was an active and important member of the Price-Fixing Com- mittee, a member of the War Labor Policies Board in behalf of the War Industries Board, and his office aff'orded a direct and ever open channel of efi"ective communication between the Board and the War Labor Administration. Like so much of the other work of the Board, a large part of the performance of the Labor Division resulted from informal conferences. The war labor news was mostly of general policies, and adjudications of open controversies by the Labor Admin- istration. Little was known of the continuous adaptation of industrial policies and the tedious appraisal of the labor factor to prevent or nip in the bud labor troubles. Most of the policies and problems that came before the Board were recognized as having a labor element, as well as elements of price, priority, facilities, requirements, etc. By this forethought much industrial controversy was avoided. As time went on, and the general authority of the Board grew, and it became supreme in priority and the final repository of the power of commandeering, there was a corresponding expansion of the power and influence of the i * ^4 t I-, [H '1 'It ; r 278 INDUSTRIAL AMERICA IN THE WORLD WAR Labor Division both in Government departments and in the industrial world. Mr. Frayne held no less than two hundred and fifty-five conferences with representatives of labor and five hundred and fifty-five with employers and chiefs of Government departments and bureaus. Besides the adjustment of disputes, determination of matters of wages, labor management, and the like, all of the industries that were in contact with the War Industries Board grew into the habit of appealing to Mr. Frayne for help in their supply of labor. He became their special friend at court with the United States Employment Service. It is reason- ably safe to say that through Mr. Frayne's initiative one hundred and twenty-five thousand workers were obtained for war industries, mostly in the way of meeting special emergencies. While Mr. Frayne was specially charged with seeing that labor was equitably treated, his associates on the Board and the employers with whom he came in contact unani- mously testify that he acted first of all as a good citizen, giving the first consideration to the demands of country as against those of a special interest. Aside from its general duties as the Board's Department of Labor, the Labor Division conducted a work which was in the nature of conservation, under the sections of War Prison Labor and National Waste Reclamation. At the head of this division was a committee made up of Dr. E. Stagg Whitin, chairman of the executive committee of the National Committee on Prisons and Prison Labor; W. J. Spillman, chief of the Office of Farm Management, Depart- ment of Agriculture; Anthony Caminetti, United States Commissioner of Immigration; John J. Manning, secretary of the Union Label Trades Department; Dr. Charles H. Winslow, Assistant Director of Research, Federal Board for Vocational Education; Edwin F. Sweet, Assistant Secretary of Commerce; and naval and army officers. The first task of this section was an investigation of the Base Sorting Plant, Inc., which had a contract with the War Department relating to waste materials. This investigation resulted in the cancellation of the contract, with, it was said, a saving of many millions of dollars to the Government. It THE CONTROL OF LABOR 279 then undertook the creation of a system of methodical saving and reclamation of waste throughout the army and navy, the Government departments, and civil life. Waste man power was found in large numbers of men of German birth, who had volunteered for or were inducted into the army. It was not thought advisable to send them into active service, and they were given the privilege of an honorable discharge. Many refused to avail themselves of this privilege, and arrangements were made to employ them in manual labor for the army, thus releasing eligible men for active service. Similar action was taken with respect to conscientious objectors, soldiers physically unfit for active service, and military prisoners. In this connection war camp gardens were encouraged. The army was persuaded to accept discharged convicts whose offenses were not treason, felony, or infamous crime. Special efforts were made for the employment, chiefly in agriculture, of such discharged prisoners as did not enter the army. Interned enemy aliens were put to work on the roads. With the assistance of local authorities and, in some states, of special laws regarding vagrancy and idleness, thousands of tramps, bums, and loafers were put to work. The waste labor in corrective institutions all over the country, if not otherwise employed, was turned to the reclamation of waste material. The studies of the section led to the estimate that the waste material of the Nation, if thoroughly reclaimed, through the use of waste labor, would represent a saving of a billion dollars annually. Local committees were forming in every county in the country to interest the public authorities in this sort of saving and otherwise promote it. As the end of the war approached. Congressional action was sought for the authorization of the use of prison labor in producing supplies for the army and navy. Through the section's initiative the army gave special attention to the utilization of food and clothing wastes. Between January 1 and October 31, 1918, nearly eighteen million articles of wearing apparel were renovated and returned to service in the army. In the single month of June, 1918, there was a saving of twenty million dollars in ; 1 * 4 • • 4 ^ j; 1 ^ 1 1^ 4 »: ; ) f \ m mi } A 280 INDUSTRIAL AMERICA IN THE WORLD WAR the equipment of eighteen thousand soldiers who went to France entirely outfitted with reclaimed equipment, which had formerly gone to junk dealers for a song. Of other materials the salvage for further use by the army amounted to a value of six hundred and thirty-three thousand dollars and the proceeds from the sale of such materials were six hundred and six thousand dollars. In addition the utiliza- tion of army garbage in the same period brought in three hundred and thirty-nine thousand dollars. The relations between the Labor Division of the War Industries Board and the War Labor Administration were so intimate and so interwoven that it is necessary to a sym- metrical presentation of Government relation with industry during the war to give some account of the latter. At every turn the War Industries Board found itself dependent on the cooperation of labor. The Council of National Defense realized the importance of the labor factor in war industry from its very inception, and there resulted a general governmental policy of scrupu- lous regard for labor's interest. Whatever the capitalist and the manager from their point of view may have to say in condemnation of the generous consideration given to labor by the Government throughout the war, and however much they may be correct in holding that many of the present complications of relations between organized labor and employers are the direct result of the somewhat paternalistic policy assumed by the Government toward labor, it was a wise war policy. With Samuel Gompers, president of the American Federation of Labor, assigned to the chairman- ship of the Labor Committee of the Council's Advisory Com- mission, the great initial planner of the industrial side of the war, labor could but feel that it was an equal partner in the war with all other factors. Other labor leaders, following Mr. Gompers's lead, with but few exceptions viewed the war as a common enterprise of all Americans, cooperative rather than autocratic. Practically all the basic policies regarding labor relations during the war were laid down by the Labor Committee, and it was the outcome of its advice that the War Labor Administration was set up. As control of all industrial matters more and more passed from THE CONTROL OF LABOR 281 the Council to its child, the War Industries Board, the central advisory function likewise passed from the Labor Com- mittee to the Labor Division of the Board. Mr. Gompers called a conference of labor leaders as early as February 28, 1917, at which it was decided that it would be wise to have organized labor take a definite public stand in regard to the approaching war. Accordingly, Mr. Gompers called a meeting of the executive council of the American Federation of Labor on March 9th, which was followed three days later by a meeting of the members of the council with one hundred and forty-eight representatives of national and international labor organizations affiliated with the Feder- ation of Labor, five departments of the Federation, and five labor organizations not affiliated with it. Among the decla- rations of labor's attitude adopted by the meeting, the following is most reflective of the war spirit of organized labor: We, the officers of national and international trade-unions of America, in national conference assembled in the capital of our Nation, hereby pledge ourselves in peace or war, in stress or storm, to stand unreservedly by the standards of liberty and the safety and preservation of the institutions and ideals of our Republic. . . . We, with these ideals of liberty and justice, herein declared as the indispensable basis for national policies, offer our services to our country in every field of activity to defend, safeguard, and preserve the Republic of the United States of America against its enemies, whomsoever they may be, and we call upon our workers and fellow citizens, in the holy name of justice, freedom, and humanity, to devotedly and patriotically give like service. The writer well remembers the dramatic and obviously sincere manner in which, in a room in the Munsey Building in Washington, Mr. Gompers read to the Advisory Com- mission his summons to labor. With great emotion he told of coming to this country as a child, of his experience in the sweatshops — for which, as he said, "I have never quite forgiven society" — and of his overpowering desire that American labor should instantly come to the side of the Government in the event of war. He said particularly that he did not want the United States to have the same difficulty with labor that England had in her first year and a half. I i ■I i- I : )' 1 M r I 282 INDUSTRIAL AMERICA IN THE WORLD WAR Gompers sat at one end of the Commission's long table, Chair- man Willard at the other, with Baruch, Rosenwald, Coffin, Martin, Godfrey, Gifford, and the writer along the sides, all listening intently. The writer took many of Mr. Gompers's remarks verbatim. There can be no doubt that in this con- tingency the veteran labor leader was first an American and a special pleader for the working-men afterward. Pursuant to Mr. Gompers's call, more than one hundred and fifty persons representative of labor organizations and of finance, commerce, and industry, as well as public and civic interests, met in Washington on April 2, 1917, as members of his general committee. Other members were added to the general committee thus created, until it eventu- ally numbered several hundred persons. An executive com- mittee was appointed with the following membership: Samuel Gompers (Chairman), American Federation of Labor, Washington, D. C. William B. Wilson, Secretary of the Department of Labor, Wash- ington, D. C. V. Everit Macy, President, National Civic Federation, New York. James Lord, President, Mining Department, American Federation of Labor, Washington, D. C. Elisha Lee, General Manager, Pennsylvania Railroad Company, Philadelphia, Pa. Warren S. Stone, Grand Chief, Brotherhood of Locomotive Engineers, Cleveland, Ohio. C. E. Michael, National Association of Manufacturers (President, Virginia Bridge & Iron Company), Roanoke, Va. Frank Morrison, Secretary, American Federation of Labor, Washington, D. C. Lee K. Frankel, Third Vice-President, Metropolitan Life In- surance Company, New York. James O'Connell, President, Metal Trades Department, American Federation of Labor, Washington, D. C. Louis B. Schram, Chairman, Labor Committee, United States Brewers' Association, Brooklyn, N. Y. Ralph M. Easley, assistant to Samuel Gompers, New York. James W. Sullivan, assistant to Samuel Gompers as member of Advisory Commission, Brooklyn, N. Y. Gertrude Beeks, Secretary, Executive Committee, New York. Other committees and their chairmen were: THE CONTROL OF LABOR 283 ,i Wages and Hours, Frank Morrison, Chairman, Washington, D. C. Mediation and Conciliation, V. Everit Macy, Chairman, New York. Welfare Work, Louis A. Coolidge, Chairman, Boston, Mass. Women in Industry, Mrs. Borden Harriman, Chairman, Wash- ington, D. C. Information and Statistics, Dr. Frederick L. Hoffman, Newark, N. J. Press, Grant Hamilton, Washington, D. C. Cost of Living, Domestic Economy, S. Thruston Ballard, Louis- ville, Ky. The executive committee adopted a resolution regarding the attitude of Governments, State and National, toward labor during the period of the war, which was approved on April 7th by the Council of National Defense and the Advisory Commission. The most significant paragraph read: That the Council of National Defense should issue a statement to employers and employees in our industrial plants and trans- portation systems advising that neither employers nor employees shall endeavor to take advantage of the country's necessities to change existing standards. When economic or other emergencies arise, requiring changes of standards, the same should be made only after such proposed changes have been investigated and approved by the Council of National Defense. This statement subjected the Council to some criticism, as advocating a policy which was opposed to the maximum of effort on the part of labor that die strain of war would involve. The Council issued an interpretative statement, the gist of which was that the Council felt that it was incum- bent upon it to warn both employers and employees that the public necessity of a state of war should not be used by either group as a means of attaining ends that had not been realized in peace. In effect, the Council's position was that during the war there should be a truce between conflicting industrial interests, for the period of which each side should hold the ground it held at the beginning of hostilities, subject only to such alterations as should be made for promoting industrial efficiency and that the determinations of such alter- ations should not be left to arbitrary action by either side. No eflfort will be made here to follow further the work f. 1 ?l|' )tf I . it 1 i 284 INDUSTRIAL AMERICA IN THE WORLD WAR of the Committee on Labor and its various sub-committees and sections, which contributed greatly to the organization and policies of the War Labor Administration of the Depart- ment of Labor. At the beginning of the war about the only machinery that department had that was suitable for dealing with the emergency in any way were the United States Board of Mediation and Conciliation, created to deal with disputes in the railway service; the Division of Conciliation, which aimed to compose labor disputes, by acting in an advisory capacity; and the United States Employment Service. These three agencies were not, however, organized, authorized, and equipped in such a way as effectively to meet the many and pressing labor problems that war evoked. As in dealing with most of the novel situations created by the war, comprehensive handling of the labor factor evolved but slowly. The first acute emergency was created by the menacing revolutionary activities of the Industrial Workers of the World in the mining and lumbering industries of the mountain States and the Pacific coast. The President appointed a commission, which was known as the President's Mediation Commission, with William B. Wilson, Secretary of Labor, as chairman, for the purpose of dealing with the concrete questions raised by these activities and of studying the conditions which bred them. This commission dealt successfully with a number of disputes, discussed the causes of labor unrest, and recommended, among other things, that the Nation should recognize the principle of collective bargaining, the creation of "continuous administrative machinery for the orderly disposition of industrial issues," and of "a unified labor administration for the period of the war." This report was not made until January 9, 1918. In the meantime the army, the navy, the Shipping Board, the Fuel Administration, and the Railroad Administration were each dealing with the labor question in piecemeal fashion. They were adjusting their own labor questions more or less independently and were competing with each other in the labor market. The labor turnover had become enormous as men lured by higher wages flitted from job to job. The demand was increased by the war boom, and at the same time the supply was curtailed through the dimin- THE CONTROL OF LABOR 285 ishing of immigration and the calling of millions of men to the colors. The unscrupulous activities of private employ- ment agencies became a national scandal. Strikes were fomented to create opportunities for their profitable employ- ment. They raided well-manned industries to get men for others, and employers often maintained employment bureaus which brazenly "stole" labor right and left. Wages were so unsettled, so ascendant, so various; employment conditions were so diverse, competition between employers so keen, that labor began to lose its balance. Strikes over the most trivial matters became frequent and the consequent loss of produc- tive effort was enormous. The word "chaos" is the only one that fits the general labor situation that prevailed in the first year of the war. The Council of National Defense, quick to safeguard labor as it was, wrestled with the question of labor administration for months, but while its Advisory Commission's Labor Com- mittee had done much within its province the Council itself held back, and all of many attempts to get it to take the initiative in establishing some sort of central control of labor failed, until January 3, 1918, when Secretary Lane intro- duced a resolution asking the President to approve of the appointment by the Council of a War Labor Board. Even then the Council declined to take positive action, but ordered that the Lane resolution and an account of the discussion on it be transmitted to the President. This resolution pro- vided that a Board composed of the Secretary of Labor, a representative of employers and a representative of labor shall be authorized to negotiate an agreement between the manu- facturing industries of the United States and labor employed therein, to endure as modified from time to time by the said Board, for the period of the war; this agreement to include the creation of machinery by which the stoppage of production by strikes or lockouts will be prevented, and the establishment of adjustment boards for the settlement of industrial disputes. The Lane resolution further provided that the Department of Labor should set up a comprehensive war labor adminis- tration for the execution of the following functions: 1. A means of furnishing an adequate and stable supply of labor to war industries. This will include: I ■1 k ' i i^ fi' II !l i 286 INDUSTRIAL AMERICA IN THE WORLD WAR (a) A satisfactory system of labor exchanges. (6) A satisfactory method and administration of training of workers. (c) An agency for determining priorities of labor demand. (d) Agencies for dilution of skilled labor as and when needed. 2. Machinery which will provide for the immediate and equitable adjustment of disputes in accordance with principles to be agreed upon between labor and capital and without stoppage of work. Such machinery would deal with demands concerning wages, hours, shop conditions, etc. 3. Machinery for safeguarding conditions of labor in the pro- duction of war essentials. This to include industrial hygiene, safety, women and child labor, etc. 4 Machinery for safeguarding conditions of living, including housing, transportation, etc. 5. Fact-gathering body to assemble and present data collected through various existing governmental agencies or by independ- ent research, to furnish the information necessary for effective executive action. 6. Information and education division, which has the functions of developing sound public sentiment, securing an exchange of information between departments of labor administration, and promotion in industrial plants of local machinery helpful in carrying out the national labor programme. The outcome of the Lane resolution and the report of the President's Mediation Commission was the designation by the President of Secretary Wilson as War Labor Adminis- trator. The latter appointed Dr. Felix Frankfurter, who had been assistant to the Secretary of War and was secretary and counsel to the President's Mediation Commission, as his assistant in charge of war labor matters. At the same time Secretary Wilson appointed an advisory council, headed by former Governor John Lind, of Minnesota, to consider and recommend such changes in the Department of Labor as were necessary to fit it for its emergency duties as a war labor administration. On what might be called the judicial as distinguished from the strictly administrative side of the labor problem, the Secretary appointed an advisory body, the War Labor Conference Board, which laid down certain principles of relations between employers and employees in the war industries and recommended the establishment of a THE CONTROL OF LABOR 287 f National War Labor Board to apply these principles in the adjudication of disputes arising out of such relations. This body consisted of five representatives of employers chosen by the National Industrial Conference Board, and five representatives of labor designated by the American Federation of Labor. Each of these groups then selected a representative of the general public; the labor men naming Frank P. Walsh, and the employers former President William H. Taft. Among the principles established for the guidance of the War Labor Board were the right of both employers and employees to organize in associations of groups and to bargain collectively; that workers should not be discharged for membership or legitimate activity in trades unions; that non-union workers should not be interfered with; and that all workers were entitled to a minimum wage "which will insure the subsistence of the worker and his family in health and reasonable comfort." The War Labor Board, composed equally of representa- tives of labor and employers, had as its joint chairmen former President William H. Taft and Frank P. Walsh, former chairman of the Industrial Relations Commission. It was appointed by the President in April, 1918, and came to be known as the Taft-Walsh Board. It endeavored to settle industrial controversies in the first instance through informal action by sections and local committees. These failing, the Board itself sought definitely to compose disputes by acting as an arbitration commission whose decisions were unanimous. Lacking such a decision, a dispute was finally dealt with by an umpire selected from a panel of ten, appointed by the President. In this way some hundreds of serious disputes were amicably settled. It is noteworthy that the War Labor Board had no statutory authority and that its decisions were not legally binding. But, as they represented the will of the President and of the vast executive and administrative establishment that was carrying on the war, and were supported by a public opinion that would permit no foolishness, they were always observed. Attention is called to the analogy of the judicial side of the War Labor Administration to the Executive control of indus- ftl !l 1 'I r 288 INDUSTRIAL AMERICA IN THE WORLD WAR try under the War Industries Board. Both functioned by consent of the governed rather than by intrinsic powers. While the War Labor Board was of the greatest assistance to the War Industries Board in composing and adjudicating the disputes which interfered so much with production, the latter was in a way more interested in the War Labor Policies Board, for the latter, which was created in May, 1918, about the time the reorganized War Industries Board began to get into its stride, proposed to standardize the practices of the Government as an employer of labor, whether directly or indirectly; and to establish a central control for all indus- tries of questions relating to the distribution of labor, wages, hours, and working conditions. The Policies Board applied the execution of its policies directly to all industries having contractual relations with the Government. Others were reached through the War Industries Board by means of its control of materials, trans- portation, and power. No transfer of labor from one indus- try to another was to be sanctioned unless directed by the War Industries Board, and it was hoped to remove the incentive for individual change of employment by stand- ardizing working conditions and wages. The War Industries Board was represented on the War Labor Policies Board by Mr. Frayne. The other members were Felix Frankfurter, chairman; Stanley King, representing the Secretary of War; Franklin D. Roosevelt, the Navy Department; G. I. Christie, the Department of Agriculture; John P. White, the Fuel Administration; R. P. Bass, the Shipping Board; Howard Coonley or Charles A. Piez, the Shipping Board and the Emergency Fleet Corporation; and representatives of the Food and Railroad Administrations. Although the War Labor Board had its general policies and principles determined for it by the President and by the National Industrial Conference Board, no conflict with it was involved in the creation of the Policies Board. The latter adopted the general principles of the former and then sought to apply them at the source of labor troubles by securing the general adoption of concrete practices that were in harmony with them. In other words, it sought so to harmonize employ- ers and employees in their relations that disputes would be THE CONTROL OF LABOR 289 ! r avoided, and so to standardize wages that they would be taken out of the realm of disputation (analogous to price- fixing of commodities). Working conditions were also to be standardized, not only as between different employment agencies of the Government, as in the shipyards, the navy yards, and the arsenals; but between them and private industries working on Government orders. It was possible for the Government as employer or paymaster to force its will in those fields. There remained the problem of competition of non-war industries, which were brought into line by the power of the War Industries Board over all the other factors of production. The war came to its end before the Policies Board's pro- gramme had been applied, or even worked out, in full, but it seems probable that the basis of satisfactory control of labor on the human side had been reached through the two boards and the Division of Labor of the War Industries Board. While these agencies were making progress in their fields of policy, mediation and adjudication, the executive administration of labor as a commodity to be collected, trained, allocated, distributed, cared for, and conserved was being dealt with by new, reorganized, or enlarged admin- istrative agencies within the Department of Labor. The most important of these agencies was the reorganized United States Employment Service, which acted as a national labor employment medium, and aimed at controlling the whole supply of labor; one purpose being to give the War Industries Board the means of applying the principle of priority to labor, just as it was applied to materials, etc. The first step in this direction was an appeal to all employers to refrain after August 1, 1918, from recruiting unskilled labor in any other way than through the Employment Service. Surveys were made of the common labor requirements of the war industries and of the reserves of such labor in each State. Employers were forbidden to make any effort to recruit labor (but might continue to hire such as applied at the gates of plants) without a special permit from the Federal Director of Labor for the particular State, or a permit from the Director-General of the Employment Service for the recruiting of labor outside the State. It was further provided I If! m I. f•^ I ' ;} h iH ; r 290 INDUSTRIAL AMERICA IN THE WORLD WAR that no unskilled labor should be transported from one State to another without special permission. In distributing such surplus labor as was found to be available, the system of the Priorities Division of the War Industries Board was utilized. While the Employment Management Section was not in the Labor Division, it was directly related to labor problems. Inefficiency of production during the war was partly due to defective management of employment. Hire-and-fire was the cut-and-dried way in which most labor forces were built up, which naturally resulted in a vast amount of misfit employ- ment and a very large labor turnover. The idea of training employment managers for the war industries probably origi- nated with Morris L. Cooke, chairman of the old Storage Committee of the Council of National Defense — a commit" tee which had no heir in the Board sections. It was cordially received by the industrial service sections of the Ordnance Department, the Quartermaster Corps, and the Emergency Fleet Corporation. Captain Boyd Fisher, of the Ordnance, took the active management of the work of providing training courses for employment managers, assisted by a joint com- mittee from the above agencies and the navy. When the War Industries Board succeeded the Council organization in all industrial matters, an employment management section was set up with James A. Inglis as chief. Training courses were established with excellent results at the Universities of Rochester, Harvard, Columbia, Pittsburgh, Washington, and California. In the iconoclastic days of war, when conventions were ignored and traditions forgotten, when the test of men and machines was their qualification for promoting victory, the belief was common that, with the shackles of the past thrown off, permanent revolutionary changes in industry and society would follow. The recommendations of the President's Mediation Commission and the principles laid down for the guidance of the War Labor Board were hailed as new and epoch-making charters of the rights of labor. Supported, as they were, by hundreds of quasi-judicial decisions by the Board and their resulting application in practice, it was thought that they would inevitably continue to be observed and become the conventions and traditions of a new era in < THE CONTROL OF LABOR 291 the relations of employers and employees. In particular it was thought that the principles of the minimum wage, recog- nitions of trade organizations, and collective bargaining would be so firmly anchored during the war that the back- wash of peace could not dislodge them. Four years after the armistice it is plain that these hopes are not to be realized in full. Labor, it must be admitted, did not rise to the level of its opportunities. Feeling too fully its power, it slowed up after the war to such an extent that for a long time it was not more than sixty per cent efficient. Employers felt that labor had taken advantage of the necessities of war to exact from them concessions that were unendurable, and they determined to even up the score when circumstances should be favorable. Such circumstances arose when the inevitable industrial depression set in. But even before that the programme of the radical laborites, who were not content with the advances made during the war, but boldly sought to syndicalize indus- try, was crushingly defeated in the great steel strike of the fall of 1919, which was also a blow to conservative labor programmes. The failure of this strike was the death-blow of bolshevism in America, and stimulated chauvinism among employers. Since then there has been a powerful campaign for the open shop, and virtually for the destruction of the power of labor organizations. The aggressiveness of employers, com- bined with the pressure of unemployment in 1920-21, resulted for the time in an apparent loss of most of the advantages gained by labor during the war. These losses, however, were rather the losses of labor in respect of the power and influence of its organizations. There has been a real gain in the national understanding of the labor problem and in a changed attitude of employers who, regardless of their attitude toward labor organizations, are everywhere intent upon improving the status of labor for reasons of self- interest if for no higher motives. As labor as a commodity began to reach the stage of a known and controllable factor, the War Industries Board established in the fall of 1918 a Labor Priorities Section with A. W. Clapp as chief. The first labor priorities order was I' T '4 I » *\: i:i •1 ij 292 INDUSTRIAL AMERICA IN THE WORLD WAR issued September 17, 1918. It explained to members of the United States Employment Service that the preference list of industries did not include all essential industries, its chief purpose being to procure an automatic flow of fuel and transportation service to such industries, and that in some instances labor would require separate treatment. Lumber, for example, was not on the preference list because it was intended to discourage long hauls of that commodity for the use of civilians and to promote the use of wood as fuel. But as certain kinds of lumber were in great demand for ffSLT purposes, it was important that the labor supply should be husbanded. The establishment of priority control of labor led to a great expansion of the power of the War Industries Board. As it was necessary that the additional men called to the colors under the selective draft should be chosen with scrupu- lous regard for the interests of the most essential industries, it became necessary for the Provost Marshal to widen the scope of his "work or fight" regulations. He appealed to the Board to help him to apply them to larger numbers of men and in more industries than at first. It now became the duty of the Priorities Division to specify what industries were freely open to the draft and what must be safeguarded. After conference with General Crowder's office and the American Federation of Labor, a bulletin was prepared which abolished the labor exemption privileges of whole classes, such as private chauff'eurs, traveling salesmen, etc. Thus the War Industries Board, already supreme in mate- rials, facilities, finance, and transportation, wheresoever involved in the industrial prosecution of the war, now became the allocator of men, not only between industries, but between civil and military life. It was become the virtual general staff" of the civil life of the country as applied to war ends. All America in all its material and human resources was subject to its command. It was an industrial dictatorship without parallel — a dictatorship by force of necessity and common consent which step by step at last encompassed the Nation and united it into a coordinated and mobile whole, supporting the army and navy with all the incomparable strength of the greatest industrial potentiality in the world. ii CHAPTER XVI IN THE SEAT OF POWER Pacifism and the dollar expended — Industry in a blind alley — The transfor- mation—A one-man authority arises — Should it have been expanded further? — The Board's hard road to power. The preceding chapters of this book and the first fifteen months of America's participation in the war represent in large measure the doing of what should have been done long before the war; namely, the ascertaining of what was to be done and how to do it. In the school of experience and at a tremendous cost the objectives were at last clarified, the methods established, and the mechanism outlined and largely filled in. Once again we had paid a staggering price for that ineradicable folly of the blind pacifism of America, which is forever sure that each war will be the last. Some one has calculated that nintey-three cents out of every dollar of current Federal expenditures represents the costs of war and armaments past and present. That calcu- lation is based on a perversion of facts. It would be very much nearer the truth to say that seventy-five cents of every dollar of current expenditures is the cost of blind pacifism. It is not improbable that a billion dollars of extraordinary expenditure on preparedness between 1914 and 1917 would have saved ten billion of the twenty-four billion dollars the war cost us, exclusive of loans to the Allies. It is even possible that such an outlay would have made our actual participation in the war unnecessary. Germany dared our intervention because she believed the Allies would be finished off" before it could become effective. The event showed that her calculation was not far wrong. As early as May, 1917, it was perceived in the councils of those who were striving to introduce order into the direc- tion of industry for war purposes that there must be some central head of industrial direction and that the determina- tion of priority of every need or requirement must be the '1 I t! , ■« \^»\ } iJ I!!"' il 294 INDUSTRIAL AMERICA IN THE WORLD WAR keystone of its functions. A year was to pass before the full power of determination of priority, supported by central control of the power of commandeering, was finally central- ized in the War Industries Board. Progress was being made during that period, but, as a general statement, it is safe to say that during that time American industry was working furiously, but blindly, for the furtherance of war ends. Clearance of current orders was the first step toward the introduction of priority. Then followed the study of require- ments and resources with the resulting application of the principle of priority to the future. Finally, we have the Priorities Division of the War Industries Board, with a Priorities Board that takes all the information in hand, bal- ances requirements against resources, determines the superior need, and directs the indicated action. Price-fixing evolves at the same time, and finally there is a powerful Price-Fixing Committee. Conservation of men and materials, allied to prosperity, explores its way, and at last becomes a powerful and effective machine. The control of facilities and the conversion of industries to war uses become comprehensive and systematic. In the exercise of priority and its con- comitants and of price-fixing, the War Industries Board gradually interlocks with all of the war-making agencies of the Government — with the Shipping Board, with the Treas- ury Department, with the army, with the navy, with the purchasing commissions of the Allies, and with the economic controls of the Allies, with the war administration of labor, with the Railroad Administration, with the Food and Fuel Administrations, and others. There results from the peculiarity of this interlocking that a Board which was originally only one among equals becomes at length paramount. The interlocking boards and committees are made up of representatives of many or all of the war agencies, but they are committees of die War Industries Board, and the chairman of each is either a mem- ber of the Board or of its organization. Behind all the functional boards and committees, except the Price-Fixing Committee, stands the chairman of the War Industries Board, in whom the final power of decision rests. Thus, once one of these apparently inter-departmental committees IN THE SEAT OF POWER 295 takes up a subject, it opens the way for the channel of power over it to the chairman of the Board. Even the Price-Fixing Committee is within his influence. It is true that he does not make prices, but he is a member of the committee and the committee knows that its business is to establish prices conformable to the general policies of the Board. Thus, the War Industries Board, in its general function of coordinating industry to meet the demands of war, grad- ually arrives at the position wherein it exercises control over all the other agencies in matters that fall within the scope of its function. At last, behind that gradually evolved com- manding position the President lodges the enormous power of the veto of the commandeering privilege, which implies its exercise, and supplements it with full control of a number of the principal commodities and their industries. Toward the other war-making bodies the War Industries Board now comes to hold a relation analogous to that of the Federal Government to the States and their people. The Board does not attempt to control or dominate the other bodies in their peculiar fields, but it afi'ects their activities by the application of its general policies to the factors of production. The Government at Washington does not attempt to tell the Government at Sacramento what it shall do in California, but in many ways it acts directly and authoritatively on the people of California. So the War Industries Board did not undertake to tell the army what to do in the military field, but it was able to tell war industries what to do with respect to army orders. To a foreigner our duplex system of government, whereby the individual is at once subject to the National and State Governments and has a dual allegiance, seems complex and clumsy, but it works admirably. To a detached observer the finally evolved system of Government relations with industry during the war would likewise seem complex and clumsy. Every producer was subject to some agency of the Government which had the buying power; on the other hand, he was subject to the War Industries Board, which had no buying powers. Again, just as the sovereign States, as well as the people, are represented in the Government at Wash- ft I 296 INDUSTRIAL AMERICA IN THE WORLD WAR ington, so the various war-making agencies, charged with particular divisions of the task, were represented in the War Industries Board, and in a way composed it. All of this interlocking and federating would have been merely an aggregation of debating societies had it not been for the fact that the moment they began to counsel they created responsible power, automatically lodged in the last analysis in the chairman of the War Industries Board. The Shipping Board, for instance, might have been very loath to see the War Industries Board applying its function of priority in a certain field. But to oppose a policy of the War Industries Board it had to speak through its representa- tives on the Priorities Board. Then and there the chairman of the former became the final arbiter of the question at issue. It is an admitted fact that this loose and seemingly frail machine of interlocking committees, emanating from a body that held no purse-strings and was empowered only in indirect ways, exercised a firmer and more general control over industry than did the munition ministries of France and England. Whether it would have been better if the body that finally firmly gripped the sequences and processes of industry for the emergency of the war by federating and blending them with itself had also held the purse-strings is not to be decided easily. In that case it might have lost itself in a multitude of matters with which it was not conversant and have sac- rificed intelligent general control and sound counsels to absorption in detail. As it was, it escaped the infinite burdens of negotiating and drawing thousands of contracts and the multitudinous details of purchase, procurement, inspection, transportation, and finance. It remained a small and compact body, creative, advisory, and generally directive, rather than executive; free to take the broad view and make the unbiased decision. It is probable that, with- out sacrifice of its efl&ciency and with great benefits to the Government and the country, it could have extended its control of the business side of war further into the sources. It had to deal with many problems which would never have arisen if it had exercised authority at the source. For example, it might have been well for the War Industries IN THE SEAT OF POWER 297 Board to have had the power to decide such a question as whether we should attempt to manufacture 75's in this country or get them all in France. Such questions as this, the Board always considered military and, therefore, outside its province. It conceived its duty to be the fulfilling, not the determination, of the requirements of the army and navy. It would not tell the army how many or what sort of guns it should have manufactured; but, when the army had decided, the general problem of getting production fell to the Board. No doubt, the proper functions of the Board were thus gummed up at the beginning. However it might have been had the Board started full-fledged at the beginning of the war and with a clean slate, it had to adapt itself to the facts of the time of its rise to power. It sought to discharge its functions through existing machinery and agencies, creating only such additional machinery of its own as was necessary to unite and coordinate what was already set up and deeply involved in war work. So far we have treated of the origin and growth of the functions of the Board and the general administrative organ- ization they entailed. These were lodged in the Board proper and in certain subsidiary organizations which have been described, with one exception. These functional divisions of the Board were those of Priority, Price-Fixing, Labor, Technical and Consulting, Requirements, Purchasing Commissions for the Allies, Conservation Division, Facilities Division, Resources and Conversion Section, Conservation Division, and the Division of Planning and Statistics. All of these and their subsidiaries dealt with the general policies involved in their functions and were more or less executive and advisory. The Technical and Consulting Section was a functional part of the Board on which it was represented through Mr. L. L. Summers, who was styled Technical Adviser, but it seems better to describe it in conjunction with the subjective chemical and explosives divisions, which were under Mr. Summers's direction. It was a long and hard period of slow growth before the War Industries Board was at last full grown and in full command of its developed functions of interknitting and I ,ii »{ '■A l|8! 298 INDUSTRIAL AMERICA IN THE WORLD WAR synclironizing the manifold activities of the huge war machine that America had built with haste and waste. But it was a sturdy if delayed growth. While it had been sending down its roots, shooting out branches and raising its head above the tangle of war agencies, it had been developing and toughening internally. The commodity sections — the trunk of the tree — had become specialized, defined, ordered, and manned by the best types of American industrial talent, genius, and experience. It would be an exaggeration to give the impression that the War Industries Board approximated perfection of function as soon as it came into fullness and power. The tangled growth of luxuriant disorder was not to be cleared in a day, and it was a matter of time to reveal and prove to all concerned that there was at last a single expert and powerful hand at the helm. Dependent for a full measure of success on the whole-hearted cooperation of many govern- mental agencies, thousands of executives, and the masterful and often headstrong captains of industry who must be gently gathered in and restrained; opposed to the last in some quarters, the Board had to make haste slowly. Nor would it be accurate to say that the Board made no errors. To say that would be to say that it did not act — and action, quick and vigorous, was one of its outstanding characteristics. ;i CHAPTER XVII THE BACKBONE OF THE BOARD: THE COMMODITY SECTIONS Baruch taps three hundred and fifty industries — Administrative organization at its height — The mechanism visualized — The Board's genesis — The dis- carded committee plan — Dissecting the commodity sections — The appetite for facts — A head center for producer and consumer — Guesswork annihilated — Industry mobilized, drilled, and militant — Coordinated industry at the service of coordinated consumption — The philosophy of business in Govern- ment — Dreams of an ordered economic world. The commodity sections were the source and the life of the War Industries Board. The Board grew out of and with them. All the other administrative divisions were based on them. They were the substance of the stuff of which requirements, price-fixing, priority, and all the subsidiaries of those three were made. They were American industry in microcosmic reduction. Mr. Baruch used to visualize them as sixty-odd neatly labeled taps, from which he and the various boards, com- mittees, and divisions that functioned between the sections on the one hand and the governmental departments, the Allies, the public and the industries on the other hand, could draw all the facts, figures, ideas, and contrivances for any situa- tion. They tapped some three hundred and fifty industrial reservoirs, represented ultimately by the war service com- mittees of the Chamber of Commerce of the United States.^ These taps were duplex and reversible. Turned one way, they poured into the Board the controlling information in regard to all American industry that was not controlled by those two independent commodity bodies, the Fuel Adminis- tration and the Food Administration. Turned the other way, they promptly transmitted to all industry the behests and requests of the Board. Altogether the commodity sections represented the highest type of administrative organization the United States has ever seen. It was a vast order without a single taint of bureaucracy. It was abundant knowledge with no trace of *See Appendix for personnel of committees. I «! r i i> i 1 I 4. 300 INDUSTRIAL AMERICA IN THE WORLD WAR pedantry. It was keen and expert business in government with absolute disinterest. It was the sort of government that would be ideal in peace if it were possible to maintain in ordinary times the output of energy, the singleness of devoted purpose, and the high ideals that dominate men in numbers only in times of imminent national peril. Modem government is more economic than political, but the manage- ment of government remains not only political, but also partisan. The commodity sections were business operating Govern- ment business for the common good. They reduced the deadliness of routine to the lowest possible minimum. They operated, not by the ponderous momentum of custom, but by the alert elaji of an initiative which faced each succeed- ing problem with zest and curiosity. They had to the highest degree that mobility, ductility, and resilience that are so constrained by the rigid lines of bureaucracy and even of most business organizations. The nominal parti- tion that separated the field of one section from the others was highly osmotic. Overlapping and interfusion were characteristic of the organization of the War Industries Board all the way through. It was not the sort of overlap- ping that, for example, chokes Alaska by the formalism of thirty bureaus, but the overlapping, the interpenetration of unjealous, cordial team-work, uncurbed by the hard-and-fast lines of statutes and regulations aimed at prevention of abuse of power instead of its efficient application. Imagine a business enterprise composed of sixty partners, each of whom is experienced in a particular field, but not lack- ing in knowledge of some of the other fields and of general industrial and commercial processes. Assume, further, that they are mostly men under fifty, and that none of them is stale or cynical and that they are engaged in a novel, stimu- lating, and absorbing enterprise, which so dominates their lives that with respect to its realization they suppress all jealousy, eliminate internal politics, and are free from self- seeking. Now, put them under a loose central control whose purpose is not to dominate, but to coordinate them, and which gives to every partner the full control of his assignment accompanied by the fullest confidence, with virtually no THE BACKBONE OF THE BOARD 301 limitation, and you have the commodity sections of the War Industries Board; and, practically, the Board itself. If you surround this central group of experts, who are largely of the type that unites the vision of the engineer to the practicality of the production manager, with a responsive environment of men of similar type made up of several hundred committees representing in a very authori- tative though voluntary way virtually the whole of American industry, you will have an almost ideal control of the industry of this continent. You have not only control, but you have a vital organism, moved from the center to the remotest boundaries by a high resolve. This loose organization, close-knit only by the threads of an inspiring common purpose, achieved results with a surprising celerity. If the tap was turned in Washington, there was the same instantaneous response at the remotest contacts of the system that the automatic water-heater gives to the bathroom faucet. The war committees of industry knew, understood, and believed in the commodity chiefs. They were of the same piece. They responded not to orders, but to rationalized inevitability, in the determination of which they were potent factors. Guided and informed by what they learned from the commodity sections, they imposed on their industries by democratic consent the burdens and restrictions of industrial mobilization and largely composed and administered their own regulations and discipline. The first stage of the commodity sections was in the com- mittees on war goods and materials formed by the members of the Advisory Commission of the Council of National Defense, but more particularly in the sub-committees on raw materials. The Committee on Raw Materials, under Baruch, Summers, and Meyer, eventually became the War Industries Board, for two reasons: first, because after a few months it was plain that the basic economic problem of the war was lodged in the administration of the production, procurement, and allocation of raw materials; and, second, because it had grasped the true idea of control of industry, Baruch's faucet idea — the compacting of knowledge and direction of all things pertaining to a given commodity into "1 ■ f' r llt . ' B I'l I I! ) V m k i|.:i Fl 1 ■i 302 INDUSTRIAL AMERICA IN THE WORLD WAR the hands of practical specialists, who were to operate through the existing business mechanism instead of through an artificial, superimposed, brand-new administrative ma- chine. From the very beginning the raw materials sub-com- mittees and their manipulation were differentiated from the other Advisory Commission committees that had to do with supplies. Mr. Baruch conceived of his committees as implements of the government of industry, but not as the Government. They were to control their respective industries for the Government, but they were not to control the Government. He was too worldly wise to think of giving over to any group of men the virtual determination of their own business relations with Government. For a long time he and two or three assistants discharged the function of contact from the side of Government with these committees. The committees were freely used, but they were watched. When in the summer of 1917, in response to public criticism and Congressional action, it became necessary to draw a sharp line between the cooperative committees of industry and the direction of governmental contact with industry, the Raw Materials Division of the War Industries Board was not much affected; none at all in principle, though some in form. Mr. Baruch and a few associates could no longer cover the whole field of commodities with an eye single to the protection of the Government's interests. The old committees were disbanded. Men from them went over to the Government side of the line and divorced them- selves from their industries or were replaced on the Govern- ment side with commodity specialists. Thereafter the War Industries Board approached each industry through a com- modity section that was entirely of and for the Board and the Government, and it was met on the part of the appro- priate industry by a committee that was frankly of and for the industry, though assumedly and generally in fact dominated by the spirit of public service. Under the auspices of the Chamber of Commerce of the United States, these committees were thereafter wholly appointed by their respective industrial groups, and were known as the "War Service Committees of Industry." THE BACKBONE OF THE BOARD 303 There was no longer a twilight zone of divided fealty in any man or committee.^ Business men wholly consecrated to Government service, but full of understanding of the problems of industry, now faced business men wholly representative of industry as distinct from Government, but sympathetic with the purpose of Government. Cooperative but sharply separated points of contact were thus created. The Raw Materials Division had always maintained the separation^ but in the early days the contact on its side was single or only slightly disturbed. Later in the War Industries Board there were sixty separate wires reaching out from the chairman to contact with more than three hundred and fifty industries. This sounds dismaying, but it was really simplicity itself. Each of the sixty wires was executively controlled by a section chief. The chairman of the Board could, in human limitations, know but little of what each chief was doing. The latter's job was defined for him and he mastered it or it *The passing of the old trade committees was definitely marked when, on October 31, 1917, the War Industries Board directed Judge Lovett to write the Director of the Council of National Defense as follows: "I am directed by the War Industries Board to say, in reply to your letter of the 17th inst., that the War Industries Board are of the opinion that com- mittees composed wholly or largely of manufacturers or producers of com- modities or articles, the price and production of which are not ordinarily fixed by law, such as coal, steel, copper, etc., should not be created and supported as committees of the Council of National Defense or of the War Industries Board, and thus be given an apparent legal status with respect to functions which as exemplified by the committees heretofore appointed are at least vague. Such committees, according to our information, have rendered most valuable service to the Government in the present emergency, but we do not deem them absolutely necessary. We believe that committees or other rep- resentatives created by and representative of the several trades themselves will be substantially as effective in cooperating with the Government as these com- mittees, where there is a bona fide desire to cooperate. In any event, such advantages, if any, as may arise from the creation and activities of such com- mittees as agencies of the Council of National Defense are in our judgment offset by the public prejudice against having a group of individuals, represent- ing an industry, act for the Government in buying the product of such in- dustry, and by the doubt as to whether the creation of such agencies harmo- nizes with public policy as established by statutes enacted by practically all the States as well as by Congress, designed to discourage organizations of groups of competitors in trade.'* Judge Lovett*s letter further made it plain that the War Industries Board would not sponsor any particular source of appointment of these committees of industry, whether by the Chamber of Commerce of the United States or by the industries directly. The Chamber of Commerce rendered an important service in this connection by seeing to it that, wherever an industry had not appointed an authorized committee, it did so; and in impressing upon all such committees the high importance of their cooperative function. 4 304 INDUSTRIAL AMERICA IN THE WORLD WAR THE BACKBONE OF THE BOARD 305 I! 4.i '^ i %* A ^ mastered him. There was no scolding, no rebuking. If the chief succeeded, he stayed; if he failed, he went. He had at his command all the powers of the Board — priority, allocation, curtailment, price-fixing, commandeering. It was assumed that he knew enough of the industries using his commodity to perceive how to wield his powers discreetly and effectually. The establishment of the war service committees marked the end of the campaign the Chamber of Commerce of the United States had been carrying on for the creation of a Government purchasing commission by act of Congress to supersede the War Industries Board. It had been largely impelled to that campaign by the dissatisfaction of many industries with the old committee system of the Council which had the basic defect of serving two more or less opposed masters. Not only did the different commodity sections work together happily and harmoniously, so that their strength was the strength of all; but they were fused with the general administrative divisions of the Board. Some heads of commodity sections or groups of sections had their places on the Priorities Committee, the Priorities Board, the Clear- ance Committee, the Price-Fixing Committee. Even if they did not belong to committees or boards, they were the chief sources of information and action of all of them. They con- stantly appeared as active agents at meetings of these and other bodies. In fact there was the union, not only of formal representation and informal attendance at meetings, but the union of daily routine and contact whereby virtually everything the Board did originated with or was referred to the commodity sections. Separately they were the perform- ing members of the Board ; collectively they were the Board, even though that designation was limited to an executive group of seven. Three members of the Board — Replogle, Peek, and Summers — in fact represented the commodity sections. Legge, besides his duties as vice-chairman of the Board and director of Requirements, represented commodity sections, including the small group that was still classed as the Raw Materials Division after many individual raw material sections had been established. . Altogether there were sixty-six units of the Board that were commonly referred to as commodity sections. Six of these were really functional rather than commodity bodies. For purposes of centralization and coordination, every true commodity section came under the department of some member of the Board or reported directly to the chairman. In some instances they were grouped first into divisions, as, for example, the Textile, Chemical, and Explosives Divisions, which would be in the department of some Board member. Two of the functional divisions — Conservation and Planning and Statistics — reported directly to the chair- man. The Steel Division and that of Planning and Statistics had sections, but were usually dealt with as units, though in computing the number of true commodity sections as sixty, the steel sections of a commodity nature have been counted. Adding the five sections of the Division of Planning and Statistics and other miscellaneous sections of an internal administrative or functional nature that were not classed as commodity sections even loosely, the total number of primary units of the Board was somewhat more than seventy The commodity sections were being added to continu ously, as industry after industry became subject to control After the final reorganization of the Board under Mr Baruch, he called and ordinarily presided at weekly meet ings of the chiefs of commodity sections, which were also attended by the heads of divisions, whether members of the Board proper or not. These meetings afforded an oppor- tunity for acquaintance, exchange of views, consideration of topics of common interest, criticism, and suggestion. They made a sort of popular assembly of the Board organiza- tion, though they had no control of policies and took action only on projects intended to promote team-work. The actual composition of this assembly was thirteen division heads and sixty-one section chiefs, no sections or other subdivisions of the Labor, Steel, Conservation, Plan- ning and Statistics Divisions being included, but being represented by their respective division chiefs. Of the section chiefs fifty-five headed true commodity sections. Full reports of these meetings were distributed to members. In order to keep the whole organization fully informed of t n If l> t u ,.ll ^ i 306 INDUSTRIAL AMERI(L\ IN THE WORLD WAR the Board's activities, there was published a confidential weekly review, which was preceded by a review with a less comprehensive field published by the Priorities Division. The latter was resumed about the time of the armistice and appeared only once or twice/ ^The following is a list of divisions and commodity sections represented at these meetings: DIVISIONS Price-Fixing Committee. Purchasing Commission for Allies. Explosives. Lahor. Planning and Statistics. Requirements. ChemicaL Facilities. Priorities. Finished Products. Steel. Textile. Conservation. SECTIONS Tin. Crane. Acid and Heavy Chemicals. •Legal. Forgings, Guns, etc. Alkali and Chlorine. Refractories. Optical Glass and Instruments. Electric Wire and Cable. Platinum. Wood Chemicals. Knit Goods. Creosote. Power. Pulp and Paper. Electrodes and Abrasives. Rubber. Lumber. Tobacco. Railroad Equipment and Supply. Miscellaneous Commodities. Tanning Materials. Automotive Products. Jute, Hemp, and Cordage. Paint and Pigment. Building Materials. Cotton and Cotton Linters. Mica. Nitrates. •News. •Fire Prevention. Machine Tool. Price. •Technical and Consulting. Coal-Gas Products. Brass — Non-ferrous Tubing. •Resources and Conversion. Agricultural Implements, etc. Foreign Wool Section. Woolens. Domestic Wool. •Inland Traffic. Electrical and Power Equipment. Fine Chemicals. Ferro- Alloys. Hardware and Hand Tool. Chain. Dye — Artificial and Vegetable. Medical. Silk. Flax Products. Emergency Construction. Hide, Leather and Leather Goods. Felt. Chemical Glass — Stoneware. Cotton Goods. •Special xYdvisory Committee on Plants and Munitions. Stored Materials. Ethyl Alcohol. Sulphur Pyrites. Non-ferrous Metals. Steel Products Section. Projectile Steel, Rails, Alloy Steel, and Cold-Drawn Steel Section. Pig Iron Section. Iron and Steel Scrap Section. •Indicates technical non-commodity sections. ^1 O H O » < Q PS < o m 02 PS H GC p Q PS < S 00 ^r .r 3 * •.- rt o g g ^ ;= P^ >? M o . 'S JC g -5 -rt CQ -a ^. « I S Z Q •« .£ "^ ►« 2 S ^ H -S g ^ ?^ « S s ^<^ o . .S-d 1^. I* S S ^ o ffl o a OS p V 5 jd 3 03 ^^'Bi<-^M •^ -»< (^ 4* 53 3 o o M H O GC H S a PS O P^ Q < o s .2 r je s o g 3 £ w s . E ►J 3 Cu O . J3 . OQ C ea Q. B o . » O c I g" 5 §.f^>^^^ = J S^ ^ c Tg *S SP o c S « SS S .S ~ o .2 -C g _ b J O o < ^ O :H g • C -I O i)^ = c S 3 H f^ «\ IV ^^ 03 S. T3 a 3 iS °° .Ca o r > ffl 3 :g CQ 7. ej O ^ fe OB C tf o 5 ^ - ~ t> -C ►£ 03 . "Sla i-ais'o g 3 ^ 3 u o t. («. ^ 09 o A< iz: H c oi a B o INTENTIONAL SECOND EXPOSURE 1 i It I il 306 INDUSTRIAL AMERICA IN THE WORLD WAR the Board's activities, there was published a confidential weekly review, which was preceded by a review with a less comprehensive field published by the Priorities Division. The latter was resumed about the time of the armistice and appeared only once or twice/ ^The following is a list of divisions and commodity sections represented at these meetings: DIVISIONS Price-Fixing Committee. Purchasing Commission for Allies. Explosives. Labor. Planning and Statistics. Requirements. ChemicaL Facilities. Priorities. Finished Products. Steel. Textile. Conservation. SECTIONS Tin. Crane. Acid and Heavy Chemicals. *Legal. Forgings, Guns, etc. Alkali and Chlorine. Refractories. Optical Glass and Instruments. Electric Wire and Cable. Platinum. Wood Chemicals. Knit Goods. Creosote. Power. Pulp and Paper. Electrodes and Abrasives. Rubber. Lumber. Tobacco. Railroad Equipment and Supply. Miscellaneous Commodities. Tanning Materials. Automotive Products. Jute, Hemp, and Cordage. Paint and Pigment. Building Materials. Cotton and Cotton Linters. Mica. Nitrates. •News. *Fire Prevention. Machine Tool. Price. •Technical and Consulting. Coal-Gas Products. Brass — Non-ferrous Tubing. •Resources and Conversion. Agricultural Implements, etc. Foreign Wool Section. Woolens. Domestic Wool. •Inland Traffic. Electrical and Power Equipment. Fine Chemicals. Ferro- Alloys. Hardware and Hand Tool. Chain. Dye — Artificial and Vegetable. Medical. Silk. Flax Products. Emergency Construction. Hide, Leather and Leather Goods. Felt. ^ Chemical Glass — Stoneware. Cotton Goods. •Special Advisory Committee on Plants and Munitions. Stored Materials. Ethyl Alcohol. Sulphur Pyrites. Non-ferrous Metals. Steel Products Section. Projectile Steel, Rails, Alloy Steel, and Cold-Drawn Steel Section. Pig Iron Section. Iron and Steel Scrap Section. •Indicates technical non-commodity sections. t o u a: Q < O Q S O O *■- o c < < 03 H U a o • «■ r. s« as • ^^ t.^ k^ i<; c i O - t o a- eJ J^ GO ^ ♦^ o o i PQ ^ "B ^ ?« «T ^ o Z be 1^ I H "-" S* s — a til *- 1^ c s or- S S o ^ . n .- »vi ^-^ -M HH u 3 >• O cj ."^ ^ t; ^ i^ 3 > » >, C 03 ;: o 00 O 2 • "f 3 ci 5 fc 3 ^-^ ^ .E bC c S3 a ^ i £^ 5 •= ^ 3 • C3 ^■3 -* w >. i_i: L^ '" ^^ c 2 .£ S „, „ ^ ^ 3 a = t_ i- ^ (^ c Tl -. — 'i; I .< = <-l 5 I - "♦.i ^^ .C > bC -r -3 a ^ 3 u £ . > a = -^ - >• - . or; C C •-! 3 5 O 'i^ a s a 5 '3 C^ .3 O ^ St -^ 3 c-S S c >) o a u 3 3 -= ^ u := .2 *r 9 -is -3 ,/■ a; . ^ ^ Xt :5 a . . ^ c o :s j^a -« . a J3 bl O O .2 ^ i (i^ iz; S j ( I: i( !i iijMr ' i-^ > ^ li i Ml ^'3 • 1^ ^«! I' ^ li h I THE BACKBONE OF THE BOARD 307 A commodity section consisted of a chief, who often had several assistants, and the representatives of the various purchasing agencies of the army, navy, Emergency Fleet, etc., that were interested in the particular commodity. At first the chief had the same relation to the departmental members of his section that Mr. Baruch had to other members of the Board; that is, the power of decision was with him. This was found to be a mistake, as the depart- mental representatives, standing for demand, and the sectional chief, standing for supply, would sometimes dis- agree, with the result that the decision was determined from the standpoint of supply. Afterwards the procedure required unanimity of the section for a decision; failing that an appeal lay directly to the chairman of the Board. The singular result of this alteration was that unanimity was almost invariable. The change brought the War Industries Board and the supply agencies of the Government much closer together. Before it was made there was a strong tendency on the part of the former to send to the com- modity sections men of inferior rank or little authority, and to act independently of it. When they found that they had an equal voice in determining the course of such a powerful aid as a commodity section, the departments sent men of rank and force to represent them. The army to a large extent duplicated the commodity system sections in its new Division of Purchase, Storage, and Traffic, so that it had a specialist of its own in each commodity section with which it was concerned. The departmental members of the sections, having absorbing administrative duties of their own, were not concerned with the section's administration, but only with its decisions. The first requirement of every commodity section to qualify it to become one of the faucets of Mr. Baruch's visu- alization was an assemblage of all the facts about materials with which they dealt. These facts were not only those relat- ing to sources of materials, processes of preparation and manufacture, names, locations, and capacities of plants, railway and other shipping facilities, but of possible substi- tutes, costs of manufacture, fairness of prices, and the per- sonal equation of producers. Without this knowledge neither 308 INDUSTRIAL AMERICA IN THE WORLD WAR THE BACKBONE OF THE BOARD 309 tf #' ! i U * i. J I I' H the section nor any other agency of Government could act rationally. It was because there was in the beginning no such grouped practical knowledge of industry that many serious errors were made in letting contracts. Usually the men at the heads of sections had a vast amount of unwritten information about the commodities they dealt with and they knew how and where to get the data required. They also knew the men of the industries and their capacities and characters. Nevertheless, the compilation of the basic facts and the maintenance of their currency were laborious tasks and consuming of time, when time was more valuable than money. The war service committees were invaluable in this work. The industries gave not only the ordinary statistical data, but revealed trade secrets, special processes, and improved methods, which, being cleared through the sections and the war service committees, enabled their com- petitors to improve quality or speed up production. Having made a survey of the industries with which it was concerned, the section was qualified to respond to the demands of the functional divisions, such as Requirements, Priority, and Price-Fixing. It was also qualified to act as the intermediary of the purchasing agencies. Into it flowed all pertinent infor- mation from industry and the Government. Out of it flowed instruction to Government agencies and direction to industries. Thus at one definite place all of an industry — the pro- ducer — and all of Government — the consumer — could, meet and dispose of every situation so far as the bringing together of requirements and supplies could do it. Many momentous matters were virtually settled by the sections before the War Industries Board proper even knew what was going on. The sections, always on watch, would see a critical situa- tion developing. They would assemble all the facts, call in all the manufacturers, or at least their war service committee, study the problem with them, work out the solution with all its involvements of allocation, priority, prices, etc., and then submit it to the proper functional division or divisions for approval and application. Sometimes Mr. Baruch or other members of the Board from their conning-towers would be the first to perceive the necessity of some course of action. In that case all they had to do was to turn on the faucet; the commodity sections saw that there was a flow of results. So far as it was humanly possible under the conditions, the commodity sections had their respective industries always on tap. There they were — sixty of them — packed into the temporary plaster and lath building of the Council of National Defense — focus- ing in Washington all the facts and all the factors of control of American industry. As they came into efiiciency, all the guesswork, uncertainty, and vagueness of Government relations with industry dis- appeared. Replogle could say to army, navy. Shipping Board, Allies, Industries: "Here's the steel tank. Let me know how much each of you is to have. There's exactly thirty-three million tons to go around." So with all the other controlled industries. No more did Government agencies shoot orders in the general direction of sources of goods, hoping to hit something sooner or later. The commodity sec- tions stood at their respective tanks, their hands on the spigots, prepared to measure out the Nation's resources, not on the old principle of first come, first served, to the limit of his demand, but in neat allocations according to the standard of priority. To use another simile, the old way had been that of general admission to a theater. Everybody who wanted seats rushed into an auditorium of unknown capacity and took them, and the last comers were out of luck. The new way was by reserved seats. It is true that under this system some got no seats, but they could get along without them. Standing room or the sidewalk sufficed for them. The more one studies the operations of the commodity sections, the more he is impressed by their simplicity and efiiciency. They were more than the mobilization of indus- try. They were industry mobilized and drilled, responsive, keen, and fully staff*ed. They were industry militant and in serried ranks. The War Industries Board stood for coor- dination among the war-making agencies, and it practiced its own preaching at home. In the end it placed superbly coordinated industry at the service of coordinated consump- tion. Thanks, of course, to priority, but the commodity sec- tions were the alpha and omega of priority. 310 INDUSTRIAL AMERICA IN THE WORLD WAR THE BACKBONE OF THE BOARD 311 I I : 1 I 1 (l f! •I M The commodity sections triumphed because they possessed knowledge. In them, if anywhere, supply was appraised and demand measured. Through their representative composi- tion they penetrated all war agencies and bound them indis- solubly together and to the magnification of the War Indus- tries Board. Around plain yellow desks in little hot cubicles of oflSces a handful of men met with the resources and dispo- sition of mighty industries in their hands. It was 'only a matter of cutting the cloth to fit the suits. At one of the weekly meetings of the commodity sections an enthusiastic section chief complained that, whereas the War Industries Board continuously and diligently invited and urged all other Government bodies concerned in the war, directly or indirectly, to be represented on its sections, com- mittees, boards, and divisions, there was little or no reci- procity. This was a blessing in disguise. All channels of influence and power thus converged in the Board, and it did not dissipate its strength. It tapped the other bodies for the elements of its own nutrition, and grew great by serving them. This was proper and logical and overcame the tend- ency for each part of the Government to wage its share of the war in a water-tight compartment. A marked characteristic of the work of the commodity sec- tions was the slight administrative machinery they required. The burden of preparation of information and the handling of an infinite amount of the detail of administration fell largely on the industries and their committees; the latter often maintaining (at an expense prorated among the indus- tries concerned) large staffs and well-appointed offices to look after the details of liaison between industry and the commodity sections. On the Government side, the details of plans, specifications, contracts, inspection, production, and delivery were in the hands of the different supply depart- ments. The conunodity sections were thus relieved of a vast mass of time-consuming and energy-exhausting detail. They were free to devote themselves to the outstanding problems of determining and enlarging resources, indicating maximum prices, uncovering and creating facilities, compiling and com- pacting requirements, speeding up industry, and informing Government in the ways of business. The reader may, perhaps, be confused by mention of the commodity sections as dealing with the functions of priority, prices, requirements, etc. The commodity sections were not merely collectors and keepers of stores. Each was a minia- ture War Industries Board for its commodity. In a very large degree the functional divisions were merely offices of record and formal approval for the dealings of the sections with their functions. All of the Board's functions were rooted in the sections. The divisions were little more in some respects than orderly entrances and exits to the sections. The principle of decentralization of authority by a central head in which it was definitely lodged was carried to the highest degree. This was the grand differentiation between the mobile War Industries Board and the rigid bureaucracy of the War Department and Government in general. Bureaucracies are machines made up of parts that are bound by statutes and regulations to automatic motions. The less play the parts have, the better the machine runs. In a bureaucracy the perfection of the machine is the main consideration; the quality of the product a minor one. Any departure of a part from its prescribed routine upsets the whole machine. In the War Industries Board, the parts did their own work in their own way. Initiative as well as per- formance were in their own hands. They were adjudged, not by the smoothness of their functioning, but by the quan- tity and quality of their product. The head from whom authority flowed reserved only enough to keep the parts working toward a common goal. If trouble arose, appeal to the head was direct and instantaneous — no tedious ascent, step by step, to the source of authority. If failure came for any reason chargeable to human weakness or ineptitude, the man was changed, but the principle of decentralization remained inviolate. The War Industries Board was built on men, not on rules. We may have budgets, comptrollers, departmental reor- ganizations, etc., to the end of time, but we diall always have bureaucracies with their woodenness of motion and their wooden-headedness of policy until Congress is willing to leave the Executive free to decentralize and big men are M i m p0 1 i •1 'J i 1 i I'' ;' ♦ i I: » 4 312 INDUSTRIAL AMERICA IN THE WORLD WAR willing to serve Government. The former will produce the latter. The forms of business are dead things without the brains and initiative of business. The War Industries Board liter- ally brought business into the business of Government. If we had a Government business manager with a free hand to run the business side of Government, as free as Baruch had in the War Industries Board, we should have a successful Government of business. The public service would be alert, initiative and energetic throughout. Some day it may occur to some President to apply the organization scheme of the War Industries Board to Government. It is little wonder that the men who dealt with the indus- tries of a nation, binned and labeled, replenished and drawn on at will for the purposes of war, and its train of conse- quences, meditated with a sort of intellectual contempt on the huge hit-and-miss confusion of peace-time industry, with its perpetual cycle of surfeit and dearth and its eternal attempt at adjustment after the event. From their medita- tions arose dreams of an ordered economic world. In the high tide of altruism bom of the brotherhood in arms of many nations, they even talked of a possible international application of the commodity-section idea to the world's raw materials. Brushing that aside as something a hundred years too soon, and returning to the sound footing of nationalism, they con- ceived of America as "commodity-sectionized" for the control of world trade. They beheld the whole trade of the world carefully computed and registered in Washington, require- ments noted, American resources on call, the faucets opened or closed according to the circumstances. In a word, a national mind and will confronting international trade and keeping its own house in business order. At the very least, they hoped that some organization would be maintained at Wash- ington that in another emergency could instantaneously expand, with the basic information ready, to deal with the problem of supply; with resources in commodity strata classi- fications articulating on the same level with corresponding strata of requirements. At the beginning of the last war the confusion was partly THE BACKBONE OF THE BOARD 313 due to many independent requirement agencies attempting to tap the commodity strata perpendicularly at different places so that the pools of supply were exhausted without warning. A year of evolution was required to realize the Baruch idea of a single controllable outlet for each commodity. With this conception accepted for the future and the pools always filled, in the information sense, the essential commodities kept under current measure and survey, it would be a quick and easy matter to mobilize industry through a central agency amply endowed with reserve powers, but cooperatively shaped. American industry was profoundly affected by the contacts of the commodity sections with war committees and groups of industries, which tended to substitute cooperation for com- petition. During the war there was virtually no competition for orders among the efficient business concerns, for the prob- lem then was not who would get patronage, but who must accept it. Every large plant engaged in an essential industry was compelled to enlarge, work overtime, and drive in order to attain the production that was allocated to it. It was necessary for firms and corporations that had hitherto been business enemies to work together, to exchange information, to pool their resources, to lend labor and executives. Com- petition in price was practically done away with by Govern- ment action. Industry was for the time in what was for it a golden age of harmony. Government prices made a living possible for all except the submerged tenth of shoestring industry; and executives, relieved from the nightmare of menacing losses, were free to give their attention to quality and quantity of product. Theoretically much of this was in violation of the letter of the anti-trust laws, and at times the Department of Justice was much perturbed. Even the industries themselves were fearful that they might be punished for doing the Govern- ment behests. On one occasion Judge Elbert Gary, chairman of the Steel Corporation, asked the opinion of the Attorney- General as to the legality of some of the inevitable conse- quences of imited effort. Having experienced the advantages of combination for a laudable public purpose, during the war, it is not unlikely that some industrial groups have I 314 INDUSTRIAL AMERICA IN THE WORLD WAR sought since to continue it for their selfish benefits and thus have effected such an intimate flow of information between themselves, intended for study from the point of view of common action for the group prosperity, that they have been able to act as units in matters of prices and regulation of production without entering technically into agreements in restriction of trade. A complex problem of industrial regu- lation is thus presented. No doubt vast economies and great general benefits are derivable from close understandings and agreements between industries. But how may the public share in, instead of being oppressed by, them? CHAPTER XVIII STEEL: AN EPIC OF THE WORLD WAR I. A conflict of blood and iron — The super-demand for steel — A nation's industries rock — The Board a storm center — Demand breeds demand — The attitude of the steel producers — Replogle's faith — Baruch and Gary negotiate steel for the navy — Wilson demands reasonable prices — Legge, Replogle, and Summers lay a foundation — The Board threatens to seize the steel plants — An historic meeting follows — Analysis of price elements — Production drops — Replogle repeatedly summons producers — Mastering the facts of steel — Baruch demands a show-down — The crisis is met — Details of the Steel Administration. n. The automobile industry fights control — The Board and the industry meet — The industry denounces: Baruch, Replogle, et al., reply — A stenographic report — Legge states a desperate case — The Board takes a peremptory stand — A great industry pleads for its life — The final agreement. III. The steel industry's contribution to the war — The Federal administration of steel appraised. I The World War was moved and fought on steel. In its last days it was as much a Vulcanic struggle between the Mesabi and Lorraine, between the Ruhr and Pittsburgh, as it was a final grapple of men in Flanders, Champagne, and the Argonne. It was literally a war of blood and iron. The long, brown ore-carriers that passed in endless procession day and night through the locks of the Sault Ste. Marie were the transports of victory as much as the ocean liners that conveyed to the battle-front the fresh bodies that were to be the final offering to Mars. The thunders of war were heard no less in the booming of rollers on ingots in the valley of the Mononga- hela than in the reverberations of great guns in the valleys of the Meuse. The fires of war burned under the lines of coke ovens at McConnellsville no less intensely than they did in the wake of the German retreat. The men who dug the coal of coke and the ore of iron were as much combatants as the enlisted men in trenches. The steel producers of America were as much pitted against Krupp and other German steel masters as Foch i i 1 I 316 INDUSTRIAL AMfeRICA IN THE WORLD WAR against Ludendorff . Pig iron and steel flowing from America to Le Creusot stiffened France as much as Pershing's fightmg men. Countless rolls of barbed wire from America held back the furor Teutonicus in 1916 and 1917, and steel rails by the thousands provided the roads of pursuit when the hordes began to recede toward the Rhine. Steel plates issued from the mills of America faster than German submarines could send them to the bottom of the ocean. Shell steel from the rolling mills of America enabled the munition plants of the Allies to provide the drum fires that smothered the Ger- man batteries, as tanks made from the same material rolled over flattened defenses. Replogle, of the War Industries Board, as generalissimo, Judge Gary and his staff, allocating and shifting orders, changing rail mills to shell mills, structural mills to rails, and so on, were playing the war game as fundamentally as Foch baiting the German bear to exhaustion and piercing his vitals in the hour of collapse. The industrial drama of the war is largely expressed in terms of steel. Ours is an age of steel in the arts of peace quite as much as in the arts of war. The puzzle of steel from first to last was how to meet the great new demands of war and simuhaneously take care of the ordinary demands that were increased by the repercussion of war needs. For example: the greater the war trafiic, largely of steel, the greater the need of the railways for steel for rails and roll- ing stock. The railroads cried aloud that, without repaired ways, more cars, and more locomotives, they would succumb to exhaustion. France, Italy, Belgium, and the A.E.F. de- manded steel as the inescapable price of victory. The Emergency Fleet Corporation pressed for unheard-of quanti- ties of plates of mills that were overwhelmed with orders for shell steel. Numerous colossal new war industrial plants needed to be housed in steel. Every direct war demand bred indirect industrial demands. The fact that demand bred demand for steel was not under- stood in the beginning. Some authorities thought the war would require about seventeen per cent of the normal steel output of the country. President Farrell, of the Steel Cor- poration, after a few months got his estimate up to forty STEEL: AN EPIC OF THE WORLD WAR 317 per cent. Later he jumped it to eighty per cent. In the end the demand for steel, bred by the war, was about one hundred and twenty per cent of the possible output. "Business-as-usual" met its first great rebuff in the steel problem. It was a smash in the solar plexus. It rocked the industries of the Nation to their base. The War Industries Board became the storm center of dramatic struggles and controversies over steel. Almost every meeting of the Board, from the first one on August 1, 1917, until the last one after the armistice, records friction between governmental agencies for steel and between them as a whole and the non-war industries; and on the part of essential industries against reduction of their supplies. Hours and days the Board, the Fuel Administration, the Railway Administration, and the captains of the steel indus- try spent in trying to solve the problem of meeting an unlim- ited demand with a limited supply. Time and again they wrangled over and wrestled with the puzzle of how to break the vicious circle whereby insufficient coal limited coke, and not enough coke limited iron and steel, and lack of steel limited cars and locomotives and maintenance of way, and thus restricted transportation upon which coal and coke pro- duction depended. And then around the circle again. Bound up with the circular recoil of effort upon effort was the question of prices. When we entered the war the steel industry was replete from long feeding on the unstinted patronage of the Allies, and at first the tendency was to exact as large prices from the Home Government as from the foreigners. In the records of the early negotiations between the army, navy, the Shipping Board, and the War Industries Board there are unmistakable signs of lack of cooperation on the part of representatives of industry. President Farrell, of the Steel Corporation, displayed a somewhat startling unfamiliarity with the costs of production of steel plates. Judge Elbert Gary, chairman of the board of the corporation, at first advocated excessive prices in the face of refuting figures of his own accountants. This attitude was partly accounted for by apprehension as to the instabilities of the future, by resentment at Government interference, and above all by a profound lack of understanding of the radical in- f • i I IS- C' /5 318 INDUSTRIAL AMERICA IN THE WORLD WAR volvements of war. In the beginning business and patriotism were confined to separate compartments. In all fairness, it should be said that the steel men soon adapted themselves to the view that the national need was above the question of profits. As soon as they understood that the rules of the games had been revised, they observed them. When they perceived that it was not a question of how much they could get, but of how much the Government would be justified in paying, and even of how much they would be justified in asking, their attitude changed from one of wary aloofness to whole-hearted cooperation. Contrast the price of 12.15 cents a pound for steel plate, with the Japanese bidding as high as 50 cents in the spring of 1917, and the 3.25 cents later obtained. Even at the height of this saturnalia of high prices, J. Leonard Replogle, who had been called to Washington by Mr. Baruch to advise the War Industries Board as to steel, expressed the confidence that when the situation clari- fied just prices could be obtained from the steel industry without resort to compulsion. In fact, on the very day he voiced this opinion he was able to put it to the test. The Italian Government was in the market for 40,000 tons of steel billets, which were then bringing around $140 a ton in the open market. Mr. Price McKinney, of the McKinney Steel Company, of Cleveland, happened to be in Mr. Replogle's oflSce. They discussed the general steel situation and the Italian requirement. Mr. Replogle said that it was obvious that steel could not bring such prices much longer, and asked Mr. McKinney to determine a fair price for the Italian order. "Write the ticket yourself, Replogle,'* was McKinney's answer. "Any price you name, profit or no profit, will be satisfactory to me." Replogle figured and said he guessed $45 a ton would be about right. That was $3,000,000 swept away, but McKinney stood pat. Once they got their shoulders into the collar, most of the steel men had the feeling of Mr. McKinney. They resented brusque orders, but they rarely resisted an appeal made to them on the ground of patriotic service accompanied by an STEEL: AN EPIC OF THE WORLD WAR 319 explanation. Many of them felt that they owed extraordi- nary service because they were making so much money. "We are all making more money out of this war than the average human being ought to," said McKinney on another occasion, in explanation of his cheerful acceptance of a hard job. Once, when Judge Gary was informing the Board that the steel interests would not ask for an increase of prices at the expiration of the ninety-day period for which prices were established, he dwelt on the fact that the level price plan accrued greatly to the profit of the Steel Corporation, "but," he added, "the tax collector comes along and takes about fifty per cent of it — and I wish it was more." The first conflicts between the Government and the steel industry arose, however, from navy and Shipping Board contracts. The Steel Corporation stood out for 4.25 cents a pound for steel plates. Government officials had reason to believe that there was a fair margin of profit for the Cor- poration at 2.5 cents a pound. Informal negotiations between Mr. Baruch and Judge Gary,* the former then speaking for the navy, resulted in a tentative price of 2.5 cents, subject to review. The same tentative price was later obtained by the Shipping Board. In one of the early conferences, Judge Gary off'ered to make a final price of 3 cents. As we shall see later, the eventual price was 3.25 cents to all producers, as compared with the 4.25 first asked by Mr. Farrell. The tremendous instability of steel prices, the public resentment at profiteering, radical measures proposed in Congress, the actual conference of the power of commandeer- ing on the Shipping Board, along with like powers resident in the War and Navy Departments, tended to dissolve the opposition of the steel industry to a degree of Government control of the industry. Many who at first opposed all Government interference came to welcome it. It was plain that the Government could not go along with prices unknown and variable and haggled over at every turn. There must be ordered, cooperative control on a reasonable price basis or the Government was certain to take over the whole indus- try. Many efforts were made to agree on some cooperative plan, but nothing but talk came out of them. In a report to the Board on the iron and steel situation i Pi ^ I li I 320 INDUSTRIAL AMERICA IN THE WORLD WAR on September 14th, Mr. Replogle dwelt on the chaotic con- dition of the iron and steel industry with respect to meeting war demands. It was evident that both prices and produc- tion must be coordinated with war policies. As early as July 12th the President had announced that the Government was determined on reasonable prices, and on the same day a committee from the American Iron and Steel Institute had discussed prices and requirements with the Secretary of War, the Secretary of the Navy, the chairman of the Shipping Board, and Mr. Baruch. It was decided to leave the settlement of prices until after the Federal Trade Commission had completed the inquiry it was then making. When the report was made, it was evident that, after all, practical men would have to iron out the prices. For instance, the report gave the cost of rolling billets and blooms as varying from $2 to $8 a ton. Any one familiar with the process would know that the variation between different plants could be scarcely more than fifty cents. The difference was simply a difference in accounting, one mill allocating a percentage of the overhead and another not doing so. The chief value of the inquiry was that it proved that there was a great disparity in costs of production between different plants. The bulky report, as a whole, was simply dismaying to the War Industries Board. To Judge Lovett, who, after a number of futile conferences with the steel men, had come to hold a poor opinion of their reasonableness, and had begun to despair of anything but compulsion, the report looked like more grease on the rails. It was then that Legge remarked that the bulk of the report did not mean anything at all to men who were familiar with the steel business. (The steel men, for their part, argued that the report reflected 1916 and not 1917 costs.) It was then suggested that there had been too much vague talk, and that Messrs. Legge, Replogle, and Summers make up a definite schedule of prices that should be demanded of the steel producers. Judge Lovett was due to leave Washington at one the next afternoon. "I'll tell you what we'll do," said Legge. "If you will have a meeting of the Board at ten o'clock to-morrow morn- ing, we will have the figures ready." STEEL: AN EPIC OF THE WORLD WAR 321 The three worked most of the night, and the next morning presented the schedule of basic coke, iron, and steel prices that was afterwards adopted for the rest of the year substantially as it stood. In fact, it remained virtually unchanged for the period of the war. On September 18th the War Industries Board decided to call a meeting of the whole industry at Washington on September 21st to which the prices determined upon by the Board would be submitted and cordial cooperation in the war programme demanded. The temper of the Board was shown by its resolution "that, if the steel interests should not be willing to give their full cooperation because of the prices fixed, the War Industries Board would take the necessary steps to take over the steel plants." The meeting was a stormy one. Sixty-five executives of the great industry faced the War Industries Board. There were heated arguments and even impassioned oratory. The Board's programme was definitely opposed as being too low. The smaller producers were in the difficult position that a bare cost price for them would make a good profit for the Steel Corporation and other highly integrated producers. On the other hand, the representatives of the Steel Corpora- tion felt that they must stand by the smaller producers. On their side the members of the War Industries Board, knowing that they had purposely raised their minimum price on plates and shell steel in order to stimulate production, were not disposed to yield. The meeting began at 10 a.m.; by noon it looked as if there could be no agreement. At this stage Hugh Frayne made a patriotic appeal in which he pointed out what a disastrous effect it would have on public opinion and morale if the leaders of the great steel industry could not amicably agree with the Government on prices, and proposed an adjournment for the purpose of "cooling off." This appeal for harmony from a labor leader made a deep impression. During the recess the steel men met and appointed commit- tees to deal with the prices of ore, coke, and pig iron, which the War Industries Board had agreed must be priced sep- arately as steps in determining steel prices. At the recon- vened joint meeting at four o'clock the respective committees I I 1 322 INDUSTRIAL AMERICA IN THE WORLD WAR named $5.05 a ton at lower lake ports for non-Bessemer Mesabi Range iron ore, $6.50 a ton for coke at the ovens (but both C. M. Schwab and Judge Gary thought $6 enough), and that $35 a ton for basic iron would permit ninety per cent of the blast furnaces to operate at a profit, though with coke at $6, $30 a ton would be fair. After Mr. Schwab, Mr. Farrell, and Mr. Clarke had made representations as to what steel should be priced at on the basis of the fore- going prices, the members of the War Industries Board retired from the meeting to permit the steel men to prepare their final schedule of basic prices. When this was presented to the Board later in the day, it was found to allow $5.05 for iron ore, $6 a net ton for coke, $33 a gross ton for pig iron, $2.90 a hundred for steel bars, $3 a hundred for shapes, and $3.25 a hundred for plates. These were not far from the prices named by the Board and were acceptable to it. Upon being approved by the President on September 24th, they were confirmed in a letter from Judge Lovett, acting chairman of the Board, to Judge Gary on September 25th, which, after specifying the prices and the period of their duration as until January 1, 1918, included as part of the agreement: Also, first, that there should be no reduction in the present rate of wages; second, that the prices above named shall be made to the public and to the nations associated with the United States in the present war with Germany, as well as to the Government of the United States; and, third, that the steel producers represented at the meeting pledge themselves to exert every eflfort necessary to keep up the production to the maximum of the past so long as the war lasts. For the highly integrated producers these prices were high and meant enormous profits in the aggregate, for directly or through subsidiaries they made a profit on ore, on coke, on iron, and on steel. Yet the Board could see no practicable way to avoid allowing a profit on each step. The cost-plus plan of prices was already distasteful to the country, inevitable as it was in some cases. The suggestion that profits be pooled and divided among all the producers had the shortcoming that it would stimulate neither the high- cost nor the low-cost producers; also it would have been STEEL: AN EPIC OF THE WORLD WAR 323 about as complicated in accounting as the cost-plus plan. It must be remembered that maximum production was then of even more importance than equitable prices. The War Industries Board sought to enlist the steel industry as an enthusiastic part of the war forces amd it needed every pound of steel that could be produced. It shrank from the com- mandeering of the industry as a whole. Perhaps, if there should be another great war, it may be possible to draft industry just as the soldier was drafted in the last war. Industry may be compelled to labor without profit, as the soldier was compelled to fight. At best it would be a dubi- ous experiment. Then, too, there were the excess profits and war taxes to fall back on. The Government balanced high profits with high taxes. At the same time the War Industries Board did not fall into the error of being indiiferent to prices because taxes would bring most of the extraordinary profits into the Treasury. It perceived the far-reaching evil economic con- sequences of varying and mounting prices in raw materials. A remoter point of importance was also the fact that if American steel prices were forced too far below the existing British prices, there would be a temptation to purchase exces- sive amounts of steel in America at the expense of American • manufacturers. So it contented itself with generous fixed prices — but which were far below those that had been pre- vailing. The market was so erratic that it is diflScult to say just what were prevailing prices, but certainly coke had been $12.75 a ton; pig iron $60; steel bars $5 a hundred pounds; shapes $6; and plates $12. The established prices were much higher than those of the pre-war period, but they were not out of line with the general increase in prices of com- modities and of labor. Following the fixation of prices in the basic materials all steel products were later priced accordingly. The steel industry accepted the new prices in good faith, the American Iron and Steel Institute appointed a cooperative committee, and from that time on, as experience showed the way, the iron and steel industry virtually became a depart- ment of the Government. It pooled its resources and, through the Institute committees, put them at the service of the Gov- I ; ■ I '1 I 324 INDUSTRIAL AMERICA IN THE WORLD WAR emment. The War Industries Board set up a steel division under Replogle, himself an acknowledged master of the business, and between that division, in touch with the needs of the Government and of war industry and the committee thoroughly conversant with and acting for the steel industry, American steel and iron making was treated as a unit. Syn- chronously with the fixing of steel prices, the War Industries Board laid down the general basis of the distribution of the product through its Priorities Circular No. 1, which estab- lished the sequence in which orders should be filled; and Circular No. 2, explaining the use of priority certificates. Thus Government price-fixing and Government allocation of products made their debut simultaneously. It is not to be assumed that the new partnership of Govern- ment and steel was always harmonious. The steel men were loath to believe that the war demands for steel were as great as the Board maintained they were. They were reluctant to give all their production to the Government and the Allies: they hated to shut off their old customers entirely. Yet the production of iron and steel was less in 1918 than in 1917, though it is agreed that prices had nothing to do with this fact. Replogle, in despair as he saw production falling behind, especially in the disastrous winter of 1917-18 — the worst in a hundred years — called the steel men into conference with the Board on several occasions. The minutes of these meetings show how the friction of war effort wore out nerves. At times the Board members were convinced that the steel industry was not doing its best, and, on the other hand, the iron and steel men, conscious of maximum effort, resented the slightest criticism. At the same time these meetings were really councils of war in which the whole situation was exhaustively discussed and reviewed, and the best minds of the industry were concentrated on ways and means of breaking up the vicious circles of relations which seemed to block at every turn every efi'ort toward increased production. How far the hard industry of iron and steel had progressed from the acquisitive days of 1917 was fully expressed by Judge Gary when he said at one of these conferences that the STEEL: AN EPIC OF THE WORLD WAR 325 steel industry, under Government control, had become such a unit that no member of it any longer had any right to conduct his business with a view to individual profit; that it was simply an integration that must be treated as having only the one purpose of serving the war purpose. He thus disposed of the last hope of some of the steel men that they might now and then fill private orders — when for the moment Government orders were off their books. If such a situation arose, the free mills had to come to the relief of the congested mills. It is not surprising that in such a robust industry as that of steel and iron, in which the tenacity of the product seems to be reflected in the character of its managers, there should have been some recalcitrants — some of the "I-will-do-with- my-business-as-I-damn-please" type. The priority clamps — the blockade of industrial manipulation — and the threat of taking over the plant finally brought all into line. Because it was the first and, all things considered, the most important of the industries dominated by the War Industries Board, in addition to being the greatest, the steel administration provides the best model of the scheme of industrial control through a compact, expert unit on the side of the Government, dealing with a close organization on the side of industry. For integrated administrative purposes this industry had the advantage of being already much cen- tralized. In the first place, the Steel Corporation represented about fifty per cent of it, and in the last analysis about fifteen men could swing the whole of it. In the next place, the long- established American Iron and Steel Institute had given the industry an advantageous rallying-point. After the agree- ment of September 22d, Judge Gary, as president of that Institute, appointed a general committee and a number of sub-committees to direct the industry in cooperation with the War Industries Board. Judge Gary was chairman of the general committee and the other members were: ' J. A. Farrell (vice-chairman), president, United States Steel Corporation, New York, N.Y. E. A. S. Clarke (secretary), president, Lackawanna Steel Com- pany, New York, N.Y. L. E. Block, vice-president, Inland Steel Company, Chicago, 111. 326 INDUSTRIAL AMERICA IN THE WORLD WAR STEEL: AN EPIC OF THE WORLD WAR 327 1 .1 J. A. Burden, president, Burden Iron Company, Troy, N.Y. J. A. Campbell, president, Youngstown Sheet and Tube Company, Youngstown, Ohio. H. G. Dalton, Pickands, Mather and Company, Cleveland, Ohio. A. C. Dinkey, president, Midvale Steel and Ordnance Company, Philadelphia, Pa. E. G. Grace, president, Bethlehem Steel Corporation, Bethlehem, Pa. A. F. Huston, president, Lukens Steel Company, Coatesville, Pa. W. L. King, vice-president, Jones and Laughlin Steel Corpora- tion, New York, N.Y. C. M. Schwab, chairman, Bethlehem Steel Corporation, New York, N.Y. J. A. Topping, chairman. Republic Iron and Steel Company, New York, N.Y. H. H. Cook (assistant secretary), American Iron and Steel Institute, New York, N.Y. An elaborate organization was set up in Washington and the head offices in New York were largely given over to war work. On his part Mr. Replogle set up a staff with Frank Pumell as assistant director and E. D. Graff, special agent; a steel products section with F. E. Thompson as chief; a projectile steel, rails, alloy steel, and cold drawn section, with Captain D. E. Sawyer as chief; a pig iron section, headed by Jay C. McLauchlan; a permit section, headed by J. S. Barclay; a bureau of warehouse distribution, with Andrew Wheeler as chief; an iron and steel scrap section, with William Vernon Phillips as chief; and a statistics section under Percy K. Withey. Paul Mackall, another of Mr. Replogle's assistants, later became the Division's representative on the Board's Foreign Mission. The success of the Steel Division was founded on its mastery of the facts of the industry, as well as the expert knowledge of its members. Every bit of information at the disposal of the Government and the Allies regarding steel requirements and purchases was collected and put in order. Every iron and steel plant in the country was required to make weekly reports, giving all the essential facts of the state of its business. Agents of the Division and of the Institute visited different plants from time to time. Lagging plants were speeded up, prompt ones were encouraged, vio- lations of priority were reprimanded and even penalized. A steel committee composed of the principal members of the Steel Division and representatives of the Government depart- ments and agencies using steel met almost daily to keep the requirements side as up-to-date as the production side, and to consider measures to meet the ever-changing situation. The general outcome was an almost incredible direction of the iron and steel industry as a unit, of which the different plants were merely subordinate parts. As offense and defense alternated in France, as the requirements of the rail- roads, the shipyards, the munitions plants varied in relative importance from day to day, mills and whole plants were speeded up or shifted from one product to another. There was a strategy of steel in America that was as much directed by events as the strategy of armies in France. The steel forces were as much discouraged by the awful sag in production in the winter of 1917-18 as the French and British by the destruction of Cough's army in March, 1918. On May 7th, Mr. Replogle, speaking at a meeting of the War Industries Board with the representatives of the automobile industry, drew a vivid picture of the steel situa- tion. He showed that there were then orders on the books of the steel mills for seven months' production, and more orders coming in all the time. As late as August 22d, Mr. Baruch, speaking to the steel men, pictured every offensive of the war as dependent on steel: Every place where there is an Allied army, no matter whether it be Italian, French, English, or American, there is a demand upon the resources of this country. The figures we have represented to you we can add to because we have additional demands for the Meso- potamia campaign. The whole Siberia project rests upon whether we can support the men there with material. As soon as that advance starts, it means steel. The whole question on the western front is a question of metals. It is not to get steel there in January or February — not even day after to-morrow, but to-day. We must have the weight of metal. If we cannot carry out this programme, I want to know it from this meeting. If we cannot do it, it is time for us to inform the military chiefs on the western front. We must say: "We cannot support you. You have got to sit there and wait 328 INDUSTRIAL AMERICA IN THE WORLD WAR STEEL: AN EPIC OF THE WORLD WAR 329 1 \ ■ * (I or go back because we cannot support you." It is really up to that. You have all done wonderfully in a great way, and person- ally I appreciate it, but if we cannot meet this demand — if you think we cannot — let us say so and give them the facts. Viewed in the whole the outlook did seem hopeless. But the steel industry met every decisive crisis, though it was able to do so only by virtually ceasing to produce steel but for war purposes, primary or secondary. The conservation of steel for war got to such a point that it was even denied to the corset manufacturers, who consumed only twenty-five thousand tons a year, until it was shown that corsets were a necessary of war — that women workers could not stand up to their work without them — when a certain amount of "off- grade" heats was allowed them. Some of the steel-consuming interests "died hard" as curtailment went on and priority choked off supplies. Step by step, however, the lines were tightened up, and Priorities Circular No. 5, of July 22, 1918, took away the last vestige of control of the steel manufac- turers over their own product. After that date no steel manufacturer could deliver goods, even if he had filled all his Government orders, without approval of the director of steel. Thenceforth no steel-using industry could continue except by grace of the War Industries Board. All this was effected with an executive and clerical force that did not exceed a hundred persons, thanks to the fact that the industry largely directed and policed itself. The more arbitrary and authoritative system of administering steel priorities in England employed three thousand persons. While it is dangerous to attempt such a generalization, the impression is that the Steel Division came nearer to being an absolute industrial control agency of the Government than did any of the other subdivisions of the War Industries Board. Of course, it did not sign contracts and make pay- ments, but it allocated virtually all the steel and iron require- ments of the United States Government and of the Allies. It could hardly have made effective use of the pooled resources and facilities of the steel industry if it had not done so. Operating under basic fixed prices, it was not involved in any price bargaining or influenced by relative prices as bal- anced against comparative eflficiency. So far as the work already in hand permitted, it was free to place each contract in the plant that was best adapted to filling it. In this part of its work the Steel Division worked in the closest union with the steel distribution sub-committee of the American Iron and Steel Institute, of which J. A. Farrell, president of the United States Steel Corporation, was chairman. In this connection it should be mentioned that the Institute, in addition to this committee, had other sub-committees on sheet steel, ferro- alloys, pig iron, iron ore, and lake transportation; tubular products, tinplate, pig tin, scrap iron and steel, wire products, wire rope, cold rolled and drawn steel, malleable castings, cast-iron pipe, and traffic conditions. Each of these articu- lated with the appropriate section of the War Industries Board. Allocation was not confined to original orders, but was even applied to the extent of shifting work in hand, in order to consolidate projects and eliminate cross-hauls and unnec- essary hauls. For example: A BufiFalo steel manufacturer was making an enormous tonnage of projectile steel to be shipped in bar form to a Cincinnati forge plant to be forged into projectile forgings, which were in turn to be shipped back to Buffalo for machining into the finished pro- jectile. A plant within fifty miles of Cincinnati was making pro- jectile bars which were being sent to Buffalo for forging and machining. The differential in price of the several contracts was very great, but, after a number of conferences which the director of steel supply had with the various manufacturers involved, arrangements were made to have the steel bars rolled in Buffalo, shipped to a near-by plant and machine shop for finishing, and in turn the Cincinnati forge man was supplied by the steel mill in his district.^ The Distribution Committee not only acquitted itself well in placing and shifting orders, but was often instnmiental in providing new plants. The Liberty Plate Mill of the Carnegie Steel Company at Pittsburgh, for example, was rolling plates for the Hog Island shipyards ninety days after groimd was broken for its foundations. Incidentally, one of the great achievements of the war was the work of the steel ^Report of the War Industries Board. Government Printing Office, Wash- ington. m d i • ,n 4 i [1^ u: 330 INDUSTRIAL AMERICA IN THE WORLD WAR rolling and steel fabricating mills in delivering the parts for the fabricated or assembly shipyards, such as Hog Island, Bristol, and Newark. Forty or fifty mills, scattered all over the country, cooperated in this undertaking. On one occa- sion Mr. Baruch casually remarked to Judge Gary that the country was deficient in forging plants. Without more ado orders were issued the next morning for an $8,000,000 exten- sion of the Steel Corporation's forging capacity. The fact that a long time elapsed before the War Indus- tries Board was in full control of industrial mobilization and industries were integrated for war purposes resulted in an immense amount of wide diffusion of "jobs" that were really imits, causing much waste of transportation, confu- sion, and loss of time. The volume of steel production was definitely limited by the production of iron, which — though greatly enlarged in the three preceding years — it was not possible to increase during 1918 (though by various devices and contrivances the capacity was enlarged). Another limitation was the neces- sity of concentrating the mills on a few lines such as projec- tile steel, ship plates, and rails. This involved extensive conversions and the erection of new plants. The Steel Cor- poration alone was at one time spending about $14,000,000 a month on new plants. Very little projectile steel was made in this country before the war, and diere had not been a large demand for rails in recent years. Nevertheless, the output of projectile steel in 1918 was 4,119,099 tons and in October shipments were averaging 115,000 tons a week. At that time France was getting 110,000 tons a month, England 85,000, and Italy 20,000. While the steel was produced to keep the Germans on the run before the hot guns of the Allies, transportation was maintained both abroad and at home. The total pro- duction of steel rails during 1918 was 2,372,691 tons. In the month of September alone 60,000 tons went to Pershing and in the year die American army got 305,000 tons, France 212,450 tons, Italy 64,484 tons, and the American railroads 1,263,720 tons. In the beginning of the war it was not thought possible to provide suflScient steel for the proposed emergency fleet. STEEL: AN EPIC OF THE WORLD WAR 331 hence the recourse to wooden ships; but in 1918 the Fleet Corporation received 2,132,907 tons of plates; the American railways, for cars and locomotives 1,100,000 tons; Canada, 53,178 tons; England, 101,365; France, 92,918; Italy, 56,595; and Japan, 100,284. At times the shipments of plates exceeded 120,000 tons a week. Allowing for duplications in reports — as when one plant made some steel product from billets received from another — it was calculated that the net production of steel during 1918 was 33,000,000 tons, although the nominal production was almost 39,000,000 tons. The steel production capacity extended so much more rapidly than iron production, which, despite the use of every old blast furnace in the country and the conversion of foundry furnaces to basic iron, was defi- nitely checked by the fuel factor, that it is doubtful if the record for 1919 would have been any better if the war had continued, except as a mild winter would have helped as against the curtailing effects of the terrific winter of 1917-18- n One of the agonizing industrial tragedies of the war was the gradual extinction to which the passenger automobile indus- try was eventually sentenced. It was the greatest of the industries that were singled out, not only for curtailment, but for one hundred per cent conversion or repression. The automobile makers had always been sensitive to the intima- tion that their business was a luxury, and they resented its implied classification among the non-essential industries during the war. Owing to its size, it became a mark for curtailment when many wholly wasteful businesses were permitted to continue but slightly impeded. It was an enormous consumer of steel — two million tons a year — and steel, as we have seen, was the crux of the war. It employed an army of men who could be used in other industries or in the ranks. The more automobiles, the greater the drain on motor fuel, already scarce; and the greater the demand for rubber for tires. Finally, when all is said and done, the country could easily have got along without further production of passenger auto- 332 INDUSTRIAL AMERICA IN THE WORLD WAR STEEL: AN EPIC OF THE WORLD WAR 333 1 li { '<' ■■I il 8 mobiles for a year or two, just as it could have got along if there had been no new clothing manufactured for civilian use for a like period. The difficulty was not in dispensing with new passenger automobiles for a time, but in conserving the life and well-being of the communities that are so largely dependent on the business and in making conversions widiout the dispersion of forces and the breaking-up of organizations. The fact that in a sense they had been singled out for sacrifice en masse, and the natural tendency to believe that they were the victims of war-industry enthusiasts, put the automobile men into a rebellious state of mind. Virtually all of them were for a long time passive obstructors of curtailment, and some were defiant. This attitude, in turn, caused an unfavorable reaction among the war administrators who realized that steel was the metal of victory, that the maximum output of it had been aUained while war demands for it were increasing. The axe must be applied some place and preferably where there would be large and immediately available results. The auto- mobile passenger industry stood out in this view like a tower on a fiat plain. When the screws of priority were first applied (because of the scarcity of alloy steels) without warning in November, 1917, there was, naturally, a violent storm of protest. In the following March an agreement was made with the War Industries Board to restrict the production of passenger auto- mobiles to thirty per cent and prepare for eventual elimina- tion. Nevertheless, according to the Board's information, many concerns proceeded to store up materials and supplies instead of balancing their inventories and tapering off'. A certain great manufacturer even challenged the War Indus- tries Board to do its worst, accompanying his challenge with a personal insult to the chairman. He had materials and fuel in abundance and thought he could stand a state of siege. No retort was made, but when his coal pile was ordered to be commandeered and the Railroad Administration *0n one occasion, so tense "was the feeling, the three members of the committee representing the automobile industry came into the writer's office greatly exercised, and the chairman of the committee said to the writer: If this persecution continues, we are going to hire the best publicity man in the country to put our case beiore the public** refused him cars for any purpose, even for his Government business, and it came to his ears that he would soon be taking orders from a smooth-faced lieutenant, if permitted to remain in his own plant at all, he saw a great light. He saw not only his folly, but also his selfishness. His submission was characteristically picturesque, and not wholly printable, but it was submission. So, when the War Industries Board called the representa- tives of the automobile industry together to confer regarding a definite limitation of the output of passenger cars, prepara- tory to ultimate conversion of the whole industry to war service, there was hard feeling on both sides. The auto- mobile men considered themselves sacrificial victims of somebody's foolish ideas of how the war should be conducted and the members of the War Industries Board considered that they had to do with a heartless industry which had already made them a laughing-stock. The first engagement occurred on May 7, 1918, when representatives of the National Automobile Chamber of Commerce met with the members of the Board. While, as pointed out, other considerations pointed to the suspension of the making of passenger automobiles, it was almost entirely on the steel factor that the Board took its stand. Mr. Replogle briefly stated the steel situation after a winter in which transportation was incommoded to such an extent as appallingly to reduce the production of steel for a long time. There were eighteen months production orders for standard steel rails, on the getting out of which depended the circulatory system of the Nation; the mills had twenty- four weeks of work on sheets; twenty-seven on seamless tubes; thirty-three on structural shapes; twenty-eight weeks on bars (in which the automobile manufacturers were chiefly interested) ; twenty-three weeks on tinplate; tubular products (also much used by the automobile industry), twenty-eight weeks. Altogether the entire steel industry had thirty weeks' demand on its production at the then rate of ship- ment. Also the demands were to become larger, and deliv- eries to some of the Allies "were in frightful shape — and we've got to make them up." The steel capacity was greater than the output, he admitted, but pig iron was the curb — »ii fit I * 1 i< I 4 J . I \ i ' : 334 INDUSTRIAL AMERICA IN THE WORLD WAR "and that in turn goes back to fuel and transportation." On behalf of the automobile men and speaking for about ninety-eight per cent of the automotive industry, exclusive of the Ford Motor Company, which is not a member of the Automobile Chamber of Commerce, Mr. John Dodge replied with an "ofiFensive defensive." In plain words he said that the whole steel and iron industry from ore to finished prod- ucts was down and lagging and boldly laid the responsibility at the door of the Government. If a steel mill is down even ten per cent [said Mr. Dodge], the Government should go and find out why it is down and remedy the trouble. I believe that with proper Government assistance these steel mills could be brought up to one hundred or even one hun- dred and twenty per cent capacity. The steel mills don't know whether they are to roll Government stuff or our stuff. If the orders were placed by the Government as a private concern would place them, there would be ample supply to meet all demands. It should be the effort of the Government to build up industries and not destroy them. It takes little ability to get a crowd of men down here and say, "You must cease manufacturing automobiles," but it takes a whole lot to speed up all the other industries. ... If this policy were pursued we would not have to be called to Wash- ington. No one ever questions in the least that our Government comes first; every one knows that. But there is no reason for the Government's building stuff and storing it, as I was told yesterday, that couldn't be shipped in five years. ... If you give us this assistance, if you give these mills and furnaces the proper assist- ance, we would have plenty of pig iron and we wouldn't need to be curtailed; and if you would just take the material that you actually need and leave us alone everybody would be satisfied. These were hard words, but it is characteristic of the tolerant methods of the War Industries Board that Mr. Baruch answered calmly that the Government was doing everything in its power and that he would be greatly pleased to know more about the Government "stuff" that could not be shipped for five years. Mr. Dodge cited an unnamed high Govern- ment official as his authority, thus touching one of the plagues of Washington during the war — the reckless remarks in private conversation by Government officials who did not know what the facts were any more than the man in the street. STEEL: AN EPIC OF THE WORLD WAR 335 What has Mr. Replogle done to increase the pig iron and scrap production? [Mr. Dodge demanded.] Mr. Replogle: We have done everything of which we are capable. Mr. Dodge: In new furnaces? Mr. Replogle: I have discouraged the building of blast furnaces. The existing furnaces are not kept operating at full capacity because of lack of fuel. This is not a question of pig iron capacity. Mr. Dodge: In other words, you mean to say that if the industry was supplied with transportation and fuel there would be more steel. JVTr. Replogle: Certainly there would be enough. It would at least take care of a great portion of the commercial interests. We have even advocated the closing-down of certain blast furnaces where the coke consumption per ton of metal is high, and putting the coke out to more modem blast furnaces. One furnace can make a ton of pig iron with 1700 pounds of coke, and another furnace may take 2500 or 2600 pounds. That is very drastic when a man who has a less modern furnace would have to shut down, but I think, sooner or later, it is bound to come to that point. That is the limiting fact, Mr. Dodge — the fuel, the coke — In that con- nection the Government is spending a vast amount of money right now. The manufacturers themselves are doing a great deal along that line. A modern coke oven costs to-day $50,000 to $52,000, which is three or four times what it would cost in normal times. But the Government is encouraging that and advancing money to people who are prepared to build such ovens — in some cases advancing one hundred per cent to cover the cost of the by-product oven, which Mr. Baruch has encouraged to the fullest extent. They will not be available for a long time to come, however. ... It is problematical just what benefit will be derived from these coke ovens. There are many cases where loaded cars of coke have been standing on sidings for days, because of the inability of the transportation people to move them. I think that situation has improved materially, but it is still far from being solved. Mr. Dodge: It appears to me that what you need is one big boss to get these departments together and shake them up and get results. Mr. E. W. Durant, of the General Motors Company, then made a strong appeal for the maintenance of the automobile organizations for the good of the country and for the good of the Government, pointing out that if they were impaired then, they would not be ready for future Government demands upon them. . I w I 336 INDUSTRIAL AMERICA IN THE WORLD WAR At this point, Mr. Noyes, speaking for the Fuel Adminis- tration, said: The actual facts of the fuel question are that the fuel situation for industrial coal is going to be immensely worse next winter than last — no question about it. It can be figured out by the ton. It is a business that cannot be placed in the hands of some Napoleonic man — in that respect it is unlike any other business. In any other business, I agree with the ideas of Mr. Dodge — any other business would say that it has got to be done. When you get to the coal business — you don't realize it is so far out of range. Remember that our weekly stunt is to produce twelve million tons of bituminous coal. We have gone through the whole line — there is not a single item from barge canals to little canals, the question of taking boats from the Lakes, from Montreal, and running them down to New England — when you get through all that, you are not going to be able to meet the demands for coal this winter. When the big war came on every railroad man testified that it was just taxing the railroads to do what the normal business of the country required to be done. Frequent embargoes were necessitated then. Now you have put on such an enormous increase that it cannot be possible to meet it in one year, and the great bulk of that increase is coal. Three years ago you were mining 440,000,000 tons of bituminous coal; this year it is figured at the least estimate you must have 600,000,000 tons of bituminous coal. You will need 160,000,000 tons more than you needed a year ago. This is a problem you cannot conceive — it simply cannot be done. Somebody has got to take a short path somewhere. The increases used to average 50,000,000 tons of coal and there would be a struggle over that. This year to supply the actual necessities that can be figured, you need at least 70,000,000 tons and possible 75,000,000 tons more than you had last year of bituminous coal. Every pound must be carried on railroads that must be taxed in the same percentage on other supplies. There is going to be a world shortage of coal for industrial purposes this year over last. Then Mr. Legge reviewed the general industrial situation, saying: It was difficult for me in a period of months to grasp what this situation was all about. I confess that I was taught to understand what Mr. Dodge says was one of the first difficulties — the big supply of coal that formerly came into New England from Nova Scotia fields was first stopped. The next item was the large supply ri STEEL: AN EPIC OF THE WORLD WAR 337 of Mexican and Texas oil carried by tankers. These tankers were taken off because we had to supply the fleet of our Government, and other fleets, with fuel oil abroad. That meant that these industries up in the Atlantic woods had to depend on coal as the oil supply was cut oflf. The Shipping Board had one hundred and twenty boats under construction in the Lakes, all of which was promised to relieve the situation. Ten per cent of them were to carry coal from Hampton Roads — from New York to New Eng- land. Unfortunately, things have occurred on the other side and the first fifty of the one hundred seven have already been requisitioned to help General Pershing. That is how our plans got shot to pieces. Coupled with that, the character of freight must be moved from the northeast comer. The railroads are handling twenty-two per cent more freight in that northeastern territory, east of Pittsburgh, than was ever handled before in American history, and it is nowhere near enough. They tell us they have reached their maximum not only of motor power, but yards and terminals, and it cannot go much further. They are handling through each of these gateways iii that country, the maximum number of cars they are capable of handling. The B. & 0. Railroad recently tried to get the coal cars to raise it to two hundred fifty cars a day. They absolutely fell down. It has not been one thing, but a hun- dred and one things to bring about conditions. The Government's building programme of this year, in dollars and cents, is equal to the entire building programme of any year prior to the war. Everybody believes we are not doing any building. Those are the facts, when you get down and analyze what has happened. Nobody likes this programme here — Mr. Durant says it is destruction. We have gone behind every month for the last six months. There has not been one week that we have been able to meet our obliga- tions from a military standpoint. We have been going back, back, back. On top of that comes the call for an increase in the army of three million. Simultaneously comes a call from England, France, and Italy for more steel, beyond any estimate they have ever given us. They have got to come back to us for more metal — that is dumped right on top of the programme. By the time you think you are to get some daylight, it gets worse. For us to sit in this meeting and not lay all the cards on the table, I think would be criminal. No one wants to stop you for a minute, and you ought to know something of what the problem is, and then, as the chairman says, if you can offer any suggestions to help us work it out, that is what we are here for. In this building programme down here, our contractors notify us that we are up against it on concrete. The cement mills in the East will close down for < I a ^11 I I ; 338 INDUSTRIAL AMERICA IN THE WORLD WAR lack of coal; the cement mills in the West will close down for lack of transportation. We ask the Railroad Administration about it, and they answer, "Do you want to haul cement or haul coal? — tell us what to haul out. We cannot do anything unless we sac- rifice some freight." If you gentlemen have a notion that this is a hobby, please get that out of your minds and get the idea of just how serious it is and tell us what you can do to help. It is not only to take care of our own army — do not get a wrong impression — but when England ran short of material, they came here; when France ran short, they came here; when Italy ran short of material, they came here. Those Allied nations are spending every month in this United States $500,000,000 for war supplies of one kind or another — half a billion dollars being spent on an average every thirty days, all of which has to come out and be taken care of somewhere, somehow. It is not for the con- sumption of the small army that this country has abroad — we have got to take care of the other fellow. As I said before, we are going back. Deferred deliveries have grown on us week by week for the last six months — that is as I see the situation. Look at it and make the best of it. Frank as the presentation of the conditions facing the Board was, it developed that its members did not feel it was proper to disclose to a large gathering all the confidential facts regarding the desperate position of the Allies and the general movement of the war at that time. It was agreed to disclose every fact to a committee of five, and the rest were to accept their word for it. This showing appeared to be conclusive at the time, but later it appeared diat it was not. The automobile men felt that, although the Government requirements were appalling as presented to them, after all far more was being currently required of industry than could be used. Unquestionably there was a deal of truth in this position, but after the most solemn warnings the requirement agencies were unable to report to the War Industries Board any important reductions. The War Industries Board had no choice but to act according to military demands. The situation was further embroiled by the action of Oiairman Edward N. Hurley, of the Ship- ping Board, who in addressing a meeting of the motor manu- facturers told them in effect that the situation was nowhere near so bad as it had been represented. STEEL: AN EPIC OF THE WORLD WAR 339 Also, it was known that Judge Gary was an optimist on the outlook for steel production and confident that the Govern- ment was over-buying. Mr. Stettinius, then an Assistant Secretary of War, also gave the automobile men some com- fort. As both the War Department and the Shipping Board were at that very moment clamoring for steel and more steel, and complaining that their work was being held back by lack of steel, and the steel men were complaining that they could not get coke and transportation enough to run to capacity, the War Industries Board was highly exasperated and adopted some rather sarcastic resolutions which pointed out the inconsistency between the demands of the War Department and the Shipping Board and the public utterances of Messrs. Stettinius and Hurley. Judge Gary even submitted a request to be permitted to supply steel to the city of Chicago for some municipal construction. With a reference by Mr. Legge to the "German Mayor of Chicago," this petition was per- emptorily rejected. In the end the committee of the Automobile Chamber of Commerce, which attended the May 7th meeting, declined to take the responsibility of imposing on the industry the programme of drastic curtailment and ultimate abandonment of the passenger automobile business favored by the Board. But as it was obvious that the Board would act without the cooperation of the industry, if necessary, Mr. Hugh Chalmers was designated to make the final stand, independently of the permanent national organization, although he was accom- panied by General Manager Reeves of that body. It was on July 16th that Judge Parker, speaking for the Board at a meeting of the Board members with Mr. Chalmers, announced that the Board had concluded that the passenger automobile business would have to be liquidated, and would be permitted to acquire only such materials as were sufficient to round out stocks on hand and limited during the liquidation process to twenty-five per cent of 1917 shipments of cars. There followed a debate that was as frank and plain- spoken as the one at the preceding meeting. A great industry — the third in the country — was pleading for its life. It considered that it was to be made the unnecessary victim of Government industrial mismanagement. On the other hand, iir r • t • : i ' 1 I { t ! 340 INDUSTRIAL AMERICA IN THE WORLD WAR the Board memters, though not without sympathy, were coldly of the opinion that this industry was willing to take a chance on there being enough steel for war purposes if it could get enough to continue making vehicles without which the country could get along for a period. Yet it was plain that, while the industry resolutely opposed suppression, it was not so much that fate it resented as it was the implication of non-essentiality. It vigorously objected to being the one great industry singled out for sac- rifice. Of course, the Board had never considered it a non- essential industry, but had come to the conclusion that it was the one enormous consumer of steel without whose product the country could get along for a while. If it had to die, the industry was prepared to accept its fate, but it wanted to be allowed to die by starvation rather than by proclama- tion. In other words, it wished to escape the notoriety of decreed curtailment, and pass off the stage through the opera- tion of the established rules of priority. It could not get away from the feeling that formal curtailment and extin- guishment was dissolution with a brand of ignominy. On the other hand, members of the Board pointed out that, without a definite starvation ration, the application of priority would instantly shut up every plant that did not have a complete store of materials on hand. Even then Mr. Chalmers stood firmly on the ground that the industry pre- ferred to take its chances rather than a lean ration. Replymg to Judge Parker, he said: That is the beginning of the end. You may not pay any attention to what I say, but this is the most serious mistake you have made down here. It means that these men will have to go to the War Department and ask for postponement of dates of delivery or cancellation of contracts. Here is another issue. Ford has been able to get his steel. This won't aflfect Henry Ford at all. Now, how is he doing it? He is getting this steel, that is sure. Henry Ford has been favored down here, because he has got his requirements, he has got his steel. Here is one concern, the Lexington-Howard Company — they came down here and begged to get $190,000 in steel and they would sign an agreement to go out of the automobile business, but they didn't get it. If you put that act through you will precipitate the worst panic the country has ever seen, and I am your friend in telling you so. It STEEL: AN EPIC OF THE WORLD WAR 341 is really ridiculous to put such an order into effect. They will have to go out of business. You might as well appoint a receiver for the State of Michigan, for it means a panic in the country — absolutely so. There are over 300,000 men in Detroit in the auto- mobile industry, and for you to do that now will certainly mean a panic. If you were to say twenty-five per cent even then twenty-five per cent wouldn't be enough to keep the organizations alive, but you say, "We want you to liquidate, but at the sanae time you can't ship over twenty-five per cent," and when it is shown that the great purchaser Henry Ford widi his $4^,000,000 plant can be favored, to get his steel for the production of fifty or sixty thousand automobiles a month, I think there will be some question. We know Ford is getting his material, but of course we don't admit there has been any discrimination.^ He has enough steel on hand to go ahead with his production. I say it would be much better than to put a ruling of that kind into eflfect to let these companies go on as they are, taking their chances of getting material to even up these industries, because without discrimination on your part, we feel that we can get some steel, that is, we may get some. Now you are not going to discriminate against this industry in favor of any other non-war industry. It would be better for us to go on as we are than to accept that kind of a ruling. Mr. Baruch: I don't see any objection to accepting that. Judge Parker: The steel mills won't fill any order except under priorities or permits. Now they can't get steel except under priorities or permits, and we cannot get them priorities or permits for any amount unless we know what they are entitled to in order that we can put them on a par with other industries. Mr. Chalmers: Here is another consideration: there are all these dealers through this country and these dealers have a large investment; they, of course, are absolutely flat out of business. Judge Parker: That is one of the uncertainties of the war. Mr. Chalmers: If you put that order into eff'ect you will ruin the automobile industry. I think it is for you to save their interest in their business and then talk about your curtailment ^Apropos of Mr. Chalmers's reference to Henry Ford, the following para- graph is quoted from the minutes of the Board's meeting on July 2, 1918: "Mr. Replogle stated that the Ford Motor Company desired 5196 tons of steel per week for the manufacture of 1300 cars per day. They also desire 2100 tons of pig iron per week. They claim their Government work alone takes 1910 tons of steel and 1120 tons of pig iron. It was decided to give them steel enough to take care of their Government work, and give them no assur- ances of any more. They are under no conditions to receive more than twenty- five per cent of their normal requirements. Mr. Replogle was directed to take up the matter of their requirements with Mr. Hanch.'* (Chief of the Auto- motive Products Section of the War Industries Board.) '•f: I ll If f I . ! 342 INDUSTRIAL AMERICA IN THE WORLD WAR Mr. Summers: You are assuming a supply of steel available when there isn't. Mr. Chalmers: We are willing to take our chances. Get your one hundred per cent war programme. We will take our chances of the situation in steel breaking. You are going to force a situation of starved industries in this country; you are accumulating a lot of war materials that cannot be shipped and when that is shown and the industries are killed you will find yourselves in a storm of criticism. Judge Parker: I am willing to go to the bat with you right now at the elections if you please as to whether we will give the boys in khaki their supplies or give the automobile industries theirs. ^ j •; t Mr. Chalmers: I am not advocating that you dont, and if 1 had to, to win this war, I would put the automobile industry out of business, if I had to to win the war; but in the absence of definite proof that you are going to use all this, and ship all this, that is a dififerent proposition. Mr. Baruch: And you would rather take the chance on keeping the industry going? . Mr. Chalmers: I am telling you this, and I think it is my busmess to tell you because we are not going to sit here and bow our heads. We are the third largest industry in this country, and with all the men we employ and all the obligations we have to our parts people, all the money we owe our banks, we cannot surrender to this. I am only here representing the Association. I am not trying to show you our side of it. Now if you need all this steel -- Mr. Baruch, please don't misunderstand me— -if you need this steel we won't get a pound of it in the next six months, but we are willing to take our chances that the production of steel will be increased or that there will be a slight diminution in the amount of shipments. If you know what is going through to be shipped, then go and talk to Mr. Schwab as to what the tonnage is going to be. Gentlemen, you have a second thought coming, now that is all there is to it, and in the meantime you have killed industry. You have got to take into consideration men employed on war work who cannot be immediately transferred from automobile work to war contracts. Would you let them go?^ So great was the demand for steel for war purposes in the *The War Industries Board had definite information on all contracts that were placed with the automobile works, having sought to divert important artillery contracts to them in addition to their aircraft contracts. It knew that it could utilize the important automobile works on essential war work and thus avoid any permanent injury to the industry. Subsequent developments showed its position to be correct. STEEL: AN EPIC OF THE WORLD WAR 343 remaining months of the war that it was demonstrated that the Board's plan was essentially far more considerate of the industry than the take-the-chances plan advocated by Mr. Chalmers. The final agreement was that the makers of passenger cars were to be permitted to produce in the last six months of 1918 one fourth as many cars as they had delivered during 1917, and to that end were to be permitted to purchase materials and parts sufiicient to match up the stocks on hand. The understanding was that the industry was to shift to war construction entirely in the first part of 1919. Inasmuch as about half the capacity of the industry was already engaged on artillery cars, trucks, tanks, aero- nautical motors, airplanes, etc., for war uses and there were many other indispensable products to which it could be con- verted, the outcome was far from being the terrible fate that had been predicted. Although the passenger automobile men put up the greatest fight of the war against control, they accepted the final agreement in good faith and lived up to* it without exception. There may be little in a name, but the early unauthorized and unwise designation of the industry as a non-essential, was undoubtedly the chief cause of the stubborn resistance it oflFered to curtailment and conversion. To this extent, at least, the Government was responsible for the situation that resulted. ni Appraising mankind as it is and conditions as they were, the writer unhesitatingly gives it as his judgment that the steel industry of America, once it realized the meaning of the war, served the Nation as faithfully as the soldiers in the ranks. It is true that in many instances great profits — too great profits for such a time of national agony — were made, but rarely were they profiteering profits, no matter how large. Under any scheme in which the industry remained in private hands, the Nation was bound to pay too much for a portion of the product. And there is no reason to believe that it would have paid less imder direct public management. There is nothing in the history of governmental administration of the railways during the war to suggest that its steel would have cost the f « m n 344 INDUSTRIAL AMERICA IN THE WORLD WAR Government any less if the industry had been taken over, but it was annexed as an autonomous state mstead ol by arbitrary incorporation. It was a fully controlled mstru- mentality of Government for results, but it preserved its own internal methods. The relation of the Government to the steel industry, when fully realized, was perhaps the best example the war afforded of the masterly conception ot industrial mobilization and functioning by the simple proc- ess of establishing effectual contact between a pooled and compactly united industry manned by its own captains and a governmental organism, expert, initiative, resourcelul, and energetic. It was a model of that highest and best form of efficiency which President Wilson declared to be the spontaneous cooperation of a free people. CHAPTER XIX THE STORY OF COPPER, BRASS, AND OTHER NON- FERROUS MUNITIONS METALS The myriad needs for copper — The copper producers fall into line — Forty-five million pounds for the army and navy — Further price agreements — The copper mines deliver — Brass for the merchant ships and navy — Zinc — Alu- minum at the Government's price — Antimony for shrapnel bullets — Lead — Nickel — Quicksilver. Throughout the war of the nations copper and its deriva- tives and products were second only to steel as a military material. Brass cannon have long since joined the bronze dagger in museums, but in the rifle cartridges and the fuses and the cases for artillery shells of projectiles, copper, or its alloys, the first metal recovered by mankind, is still a lethal weapon of prime importance. But it is the industrial implications of modern wars that make copper so important. As a medium of communication alone, for every ton of deadweight, three poimds of copper and brass go into every commercial ship in the shape of tubing, wire, and condensers; to say nothing of all the copper and brass for fittings. Naval vessels likewise require large quantities of the red metal. Almost every engine of war from the hand grenade to the airplane requires copper. The military telephone and telegraph systems of a communication behind the lines and the field telephone and telegraph services of the Signal Corps demand unbelievable quantities of copper. It is consumed in large quantities by the machinery of production in almost every industry that is stimulated by the demands of war. At the pinching ofi* of the St. Mihiel salient, approximately five thousand telephones were used, and more than fifty thousand miles of field wire were laid especially for that engagement. In copper as in steel, the war in all its stages was based on American resources, and also as with steel it was the i I Mh 346 INDUSTRIAL AMERICA IN THE WORLD WAR strength of American copper that was one of the decisive factors in the final act. In this final phase the struggle was one between the mines of America and the scrap of Germany. Almost without domestic copper resources, Germany had to fight from stores laid in before the war and from the metal garnered from house roofs and gutters, from church bells and kitchen utensils. As these supplies failed and substitutes failed in efficiency, the industrial barometer forecast the defeat of the Teutonic arms even before it was recorded in lost battles. Perhaps with design, copper had been lavishly used in Germany in permanent construction and in durable utensils and implements for many years, but the roofs and kitchens even of an empire are no match for the stores of nature in Anaconda, Utah, Bisbee, Miami, and the Copper Range. The German Hausfrau might be more docile and more amenable to discipline than the rough and independent copper miners, streaked with alienism, bolshevism, syndi- calism, and prone to strike, but the advantage was with them. Producing two thirds of the world's copper, and backed by the refineries of the Atlantic coast and the copper workers of Naugatuck and other centers of preparation and manu- facture, the copper mines of the North, the West, and the Southwest, beset by labor troubles, hobbled by the draft, cramped by transportation deficiencies, and sometimes starved for lack of fuel, fed the workshops of the Republic and of the Allies with unfailing streams of the second metal of victory. The copper men have the distinction of being the industry that sounded the industrial keynote of the war — the note of service and of repudiation of profiteering. With the industrial compulsion of later war times yet unrealized, with all their output in eager demand by Allies and neutrals, and with prices soaring beyond the dreams of avarice to three or four times pre-war levels, they cordially met the Government's initial requirements at something less than half the prevailing prices. One of the small measures of preparedness tolerated by a great people involved the purchase by the army and navy of 45,000,000 pounds of copper somewhat before war was THE STORY OF COPPER, BRASS, ETC. 347 declared. The negotiations were entrusted to Mr. Baruch, who was then chairman of the Committee on Raw Materials of the Advisory Commission of the Council of National Defense. He in turn advised with Eugene Meyer, Jr., who was a prime mover in the matter, and other business men. Meyer suggested that a straight-out appeal be made to the leading copper producers to disregard the market and pro- vide the specified amount of copper at an arbitrarily low price. Baruch and Meyer called on Daniel Guggenheim, of Guggenheim Brothers, informed him of the Government's need of copper and appealed to him to make a price that would dispel the thought that the impending war was being pushed on by the greed of anticipated profits — a price also that would set an example for all future dealings between the Government and producers and tend to divest the war of that ignominy of blood-sucking profiteering from the public necessity that has produced its swarms of heartless contractors and battle-field ghouls in every war of ancient or modern times. Mr. Guggenheim offered no objections to this appeal and merely asked for time to consult with the other large producers. There were some other conversa- tions on the subject and the representatives of the Council of National Defense made the suggestion that the exemplary price be the average price for the ten years 1907 to 1916. On March 19th, the chief copper producers, under the leadership of John D. Ryan, united in addressing a letter to the Council of National Defense in which they stated that they would deliver 20,000,000 pounds to the navy and 25,510,000 pounds to the army in approximately equal quantities each quarter from April, 1917, to April, 1918, at the price of 16.6739 cents a pound — that being the actual average selling price obtained by the United Metals Selling Company during the period named. "We ofi'er the copper at this price," said the latter, "notwithstanding our costs for labor, materials, supplies, etc., vary from thirty to seventy-five per cent above the average during the ten-year period, because we believe it to be our duty to furnish the requirements of the Government in preparing the Nation for war with no profit more than we receive from our \A u i I ''ii *l 'I I ( 348 INDUSTRIAL AMERICA IN THE WORLD WAR regular production in normal times. It is understood that the price quoted above is for the quantity and period of delivery above mentioned." As orders for copper went during the war, this was not a large order and the saving to the Government — some $3,700,000 — as compared with the market price was a mere drop in the flood of war expenditures that was to follow, but it was important as furnishing a precedent to illustrate the principle that it was hoped would govern all business men in their dealings with the Government. That the copper men themselves lived up to the principle through- out the war there can be no question. It is true that later purchases were at 23^ cents and even 26 cents a pound, and that at both of the later prices the low-cost producers made handsome profits, but here, as in steel and in other things, it was considered that a cost-plus price, which meant a diff'erent price for each producer, was not practicable nor stimulative of maximum production. As it was estimated that war uses would require about ninety per cent of the total production, it was evident that the stimulation of production was even more important than regulation of prices. Of course, the war and excess profits taxes came in as a sort of rebate to the Government, and there was the recurrent argument that prices did not make much diff'erence, anyway, as the higher the price scale the more the Government's revenues. As has been noted else- where, the Raw Materials Committee and the War Industries Board never surrendered to this fallacy, but always strove for the minimum price that would stimulate an industry as a whole, falling back on the excess profits tax merely as a rough corrective of an unavoidable evil. Stability of commerce and industry was one of the essentials of maximum production, for more reasons than one. With erratic and ever mounting prices there would follow a train of labor disputes, runaway costs of living, protective as well as profiteering profits, a huge expansion of war costs and debts, increased difficulties of public financing, and then — after the war — the deluge. The price of 16.6739 cents, voluntarily named by the large copper producers for the 45,000,000 pounds, was in no sense a fixed price. It was more in the nature of a THE STORY OF COPPER, BRASS, ETC. 349 dramatic gesture and an expression of attitude. When the army came into the market again in June for 60,000,000 pounds of copper, the market price was 32.57. There was no intention of paying that price, but at the same time there was no expectation that the producers would match their March 19th concession. The 45,000,000 pounds were turned over to the Government without incidental reflection in the wage scale of the miners, which was based on 15-cent copper with a bonus of 25 cents a day for each 2-cent advance in the price of copper. It was evident that with the Government taking virtually all the copper for itself and Allies, the Government price would be the market price. In June, 1917, the miners were receiving bonuses on a price of 27 cents, and to have accepted as a permanent price the gift-price of March would have meant roughly a reduction of a dollar a day in the wages of the men in the Arizona mines. Notwithstanding the scale, the miners threatened to strike if the price were reduced and in some instances did strike. In the absence of an agreed price, the producers continued to deliver copper to the Government without payment, it being understood that after the Federal Trade Commission had investigated copper mining costs there would be an adjustment. Soon after the 60,000,000-pound army order, the Sec- retary of the Navy announced that on further orders for the navy he would pay down 75 per cent of 25 cents, leaving the other 25 per cent as a margin for adjustment. This announcement had a disturbing efi'ect on the Arizona miners, and there was much fear that production would be curtailed, as it was felt in some quarters that 18.75 cents was the price the Government had decided to maintain. The War Industries Board was convinced that such a price meant curtailment of production, and, through its efi"orts, it was finally agreed that the cash payment on Government orders would be 22.5, leaving 2.5 cents leeway for adjustment. Then France and England, which had purchased 660,000,000 pounds of copper in the United States during 1916 at as high as 27 cents a pound, came into the market for 77,000,000 pounds, but instead of acting independently and competitively they called on the War Industries Board to deal for them. '^■'H 350 INDUSTRIAL AMERICA IN THE WORLD WAR The Board met the producers in conference on August 7th and offered them 20 cents a pound for the first 60,000,000 pounds of the copper required by the Allies, it being understood that this price should not be a precedent, but Siat the final price might be higher or lower, as should be determined later. The Board decided at the same time to commandeer the copper in question if the producers should not acquiesce. Nevertheless, when the Board and the producers met again, the latter were so determined in their opposition to the price of 20 cents, and supported their position so well, that the conviction of the Board as to the reasonableness of the price was weakened. The Board then suggested a tentative price of 22.5 cents subject to later revision. This was not satisfactory, either, to the producers, as they were opposed to the whole principle of tentative prices. Finally on August 16th the copper producers agreed to deliver the 77,000,000 pounds without price or payment on account until a final price had been established. A little while thereafter the Federal Trade Commission made its report, and after studying it the Board decided to fix a price of 22 cents a pound. Once more the copper producers were called in, for the Board was loath to incur their dis- pleasure and eager to secure their cordial cooperation. There was no optimism about obtaining maximum pro- duction by commandeering production, or the mines, smelters, and refiners. At this meeting the Board stood for a price of 22 cents for refined electrolytic copper for the Government, the Allies, and the public — for a limited period — with the proviso that wages were to stay on the 27-cent level, not- withstanding the sliding-scale agreement. The producers objected vehemently, both orally and by written memorandum submitted later. They implored the Board to make the price 25 cents, and John D. Ryan, president of the Anaconda Copper Company, speaking for the producers, said that at that price the producers would engage to pool and deliver not only the entire production of die United States, but virtually all the copper of the world. The producers said that at 22 cents there was no hope of controlling by voluntary THE STORY OF COPPER, BRASS, ETC. 351 cooperation the output of the smaller, high-cost producers; that labor troubles would result if the sliding scale was tampered with. The larger producers were frank enough to say that the difficulty as to price was not with them, but that, since cooperation of the whole industry was essential, it was incumbent upon them to stand for a flat price that would make such cooperation feasible. They dwelt on the almost insurmountable difficulties of eff'ectively com- mandeering the numerous small, high-cost mines, and made the following suggestion: While some of the low-cost producers will show a large profit at twenty five cents, some of the largest and practically all of the small producers cannot show more than the usual peace-time profit at that price, and if depletion of mines is considered, their profit would probably Be less than in normal times at average prices. We believe that it would be in the interest of the Govern- ment to pay twenty-five cents per pound and take all of the production of all the mines of the country at that price, retaining all of the copper which is needed for this Government and for its Allies, and selling the balance at the same price, or approxi- mately the same price, to the public. Finally, on September 14th, the larger copper producers met in New York and with only one dissenting vote agreed to make the Board a compromise price of 231/2 cents. At that price, John D. Ryan, chairman of the Copper Coopera- tive Committee, wrote the Board, "We would still be able to get the practical result that we are aiming for, that is, pretty nearly maximum production; therefore, I would say that if your committee would agree to 231/^ cents, we can pledge the copper industry almost as a whole to use every possible means to secure a maximum production and to maintain the present scale of wages, and I am satisfied we can succeed.'* This proposition was accepted by the Board and approved by the President, it being specified that the agreed price should prevail for only four months. During that period consumers and producers were invited to present objections to the new price. Many of the latter did so, but no con- sumer objected. Besides maintaining wages as they were, it was agreed that the negotiated price should prevail for the Government, for the Allies, and for the public, and that 352 INDUSTRIAL AMERICA IN THE WORLD WAR THE STORY OF COPPER, BRASS, ETC. 353 f> 1 •W f HI j 1 t I \ the producers should loyally exert themselves to maximum production and keep the metal out of the hands of specu- lators. So many complaints of the agreed price were received from the small producers and the need of copper was so great that in the summer of 1918 the price was advanced to 26 cents. Under the cooperative agreement the committee of the producers became the sole medium of commercial relation- ship between the Government and the producers. No cop- per was sold except on the approval of the committee, and private consumers were restricted to the smallest possible current demand, no stores being permitted. The two lead- ing copper selling organizations took over the details under the direction of the committee, which followed the wishes of the War Industries Board. United States Government orders were attended to by the United Metals Selling Com- pany, while the American Smelting and Refining Company looked after the requirements of the Allies. On the part of the War Industries Board the administra- tive contact with the copper industry was through the Non- Ferrous Metals Section, which was organized in October, 1917, with Eugene Meyer, Jr., as chief, assisted by 0. F. Weber, H. B. Moulton, and E. N. Feidman, and, later, by Pope Yeatman. When in March, 1918, Mr. Meyer became a director of the War Finance Corporation, Mr. Yeatman became section chief. Some months later the section was designated as a division with Mr. Yeatman at its head, his staff including E. Coppe Thurston, Erwin H. Cornell in charge of lead, George T. Stone in charge of zinc, assisted by Andrew Waltz, and Lieutenant H. R. Aldrich, statistician. Although Government requirements were put as high as ninety-three per cent of the supply, there was never any real shortage of copper during the war, despite the fact that the refinery output was less in 1918 than in 1917. The mines and the smelters, on the whole, increased production in 1918, as compared with 1917, although they labored imder many difficulties, such as the military draft and the labor com- petition of the mushroom war industries. Transportation and fuel were rarely problems for the mines and smelters, which are mostly in the West and, therefore, outside the congested region; but it was otherwise with the refineries located, largely, on the Atlantic coast in the midst of the congested region and fed with "blister" from the smelters by a long haul. In addition to new copper there was an increase of one hundred per cent in 1918 in the recovery of secondary copper from furnace ashes and cinders, waste and scrap. Even in 1917, when there were disastrous strikes in Montana and Arizona, the mines and smelters put out more copper than in 1916, the production in that year being 2,428,000,000 pounds, or fifty-one per cent more than in 1913. Truly, the copper armies did their part in a war that was so largely decided in the industrial home sector. But copper is only a raw material, and after the mines, smelters, and refineries had done their work, there remained the problems of direction and control of manufactured prod- ucts in the form of pure copper and the alloys; brass, cupro-nickel, German silver, and white metal. To deal with this stage of the industry, the War Industries Board established a brass section in April, 1918, Everett Morss being chief. This section concerned itself with brass and copper products in the form of rods, rolled sheet, and strips; tubes (brazed, welded, and seamed), wire, and all other non- ferrous alloys. The greatest task before the section was that of meeting the demands of the Emergency Fleet Corporation and the navy for tubing. The known navy requirements for special tubing were 1,355,000 pounds and 500,000 pounds of incidental tubing. Moreover, it was estimated that 2,000,- 000 pounds more would be required for condenser tubes. These were considered the minimum, but in addition there were large numbers of naval ships building in private yards, the requirements for which were not known, though it was ascertained that every destroyer would need 59,694 pounds of brass and copper tube. The average merchant ship built by the Fleet Corporation required 24,000 pounds. This meant that in 1919 the emergency fleet would have consumed 45,000,000 pounds of tubing, or one third of the total pro- duction. A cooperative committee of tube manufacturers with Mr. John P. Elton, vice-president of the American I i>- \ ■■ 'i'M^' M ;^'l ! m\ h 1 {4: ■ M I li I ;l 354 INDUSTRIAL AMERICA IN THE WORLD WAR Brass Company, as chairman, was formed and the whole field of stimulating production, increasing facilities, standardization, conversion, and conservation was thoroughly covered. Toward the end of the war a very serious situation developed in brass products. At the end of August, the army, the navy, and the Allies were calling for 1,140,000 pounds of rod, 3,220,000 pounds of disks and sheets, and 325,000 pounds of cupro, and the production was alarm- ingly less, although the nominal capacity was about the same. In August the mills were short 9600 men, and the influenza epidemic reduced the number of men in the Con- necticut region to fifty per cent of normal. At the same time the requirements for brass rods and disks, used in cartridge-case manufacture, from the French and Italian armies as well as from our own Ordnance Department, sud- denly exceeded all estimates. It was then necessary to put the industry under strict control, and at that no source of supply could be found for sixty per cent of the demand. The continuance of such a condition meant that in a pro- longed war the infantry would be without cartridges and the artillery without cases. The army was called upon to furlough men drafted from the copper-working industries, new plants were projected far removed from the center of the industry, in the Naugatuck Valley of Connecticut, and every possible shift was made. Fortunately the end of the war came before the effects of lagging production became acute. In wire, too, the situation was becoming critical, following the call of the Signal Corps in September for 1,500,000 pounds of wire for field telephones. It has since developed that in this as in many other fields of war supplies the calculated requirements were greater than the actual needs; and while this belated knowledge is comforting in speculating on what might have happened had the war continued, it does not in any way modify the gravity of the tasks that were assigned to the brass section and to the copper and brass working industries. Zinc figures as a war material, chiefly through its use in union with copper in the making of brass and allied \ THE STORY OF COPPER, BRASS, ETC. 355 alloys and for galvanizing steel. In its crude form — spelter — there was never any shortage of it during the war for military purposes, though there was a considerable diversion of this metal from certain peace-time uses and it was important as a substitute for steel in some uses. The United States produces thirty-one per cent of the zinc of the world, and there was no problem of importations to deal with. Neither was price a vexatious matter, as it was with many other metals. The main problem of zinc regulation was to secure a sufficient quantity of the higher grades, demanded by the army and the navy in the manufacture of small-arm ammunition shells. This was solved by putting a stimu- lative maximum price of twelve cents a pound on Grade A spelter. It was not felt that there was any need of a mini- mum price in order to stimulate production. The zinc industry was not highly organized. Although there was at one time a zinc committee in the Raw Materials Division of the Advisory Commission of the Council of National Defense, it was dissolved when the market price of zinc fell below the level of prices it was intended to secure by agreement. Throughout the war Government purchases were made directly by negotiation or by competitive bids. After the maximum base price for sheet and lead had been established, the mines of the Joplin field, which could not continue at the prices they had been receiving, proposed to the zinc rolling mills that the latter should increase their price from about $50 to about $75 a ton based on sixty per cent zinc concentrates and a certain maximum of lead con- tent, and distribute their requirements proportionately among all the mines. This proposal was favorably received and the mine owners formed an association, a committee of which was authorized by the Non-Ferrous Metals Section to receive the pooled requirements of the rolling mills and allocate them among the mines. The American Zinc Insti- tute was formed in July, 1918, for the purpose of promoting the interests of the whole industry, but it was not a war service organization. The sole producer of aluminum metal in the United State« 1 m i I I * R I ; tr 356 INDUSTRIAL AMERICA IN THE WORLD WAR and Canada is the Aluminum Company of America; con- sequently Arthur Davis, the president of that company, could speak and act for the whole industry in dealing with the War Industries Board. He virtually placed the industry at the disposition of the Government and acted at all times on the highest plane of service and patriotism. On April 25, 1917, he offered to the Government, through Mr. Baruch, all the aluminum it might require at that time at its own price, despite the fact that the outside price was 60 cents. Two million pounds were immediately accepted at 271/2 cents, and later six million pounds were added, delivery to be made before August. In September, Mr. Davis agreed with the War Industries Board through Mr. Meyer to fill all war industry requirements, direct or indirect, at the current 38-cent base price and to refund the diflference should the Government later name a lower price. Owing to the short- age that began to develop at a later period, the Federal Trade Commission was asked to investigate the costs of aluminum manufacture. With the Commission's report before it, the Price-Fixing Committee in agreement with the Aluminum Company fixed the base price at 32 cents for aluminum ingots in fifty-ton lots, f .o.b. the producing plants. This price prevailed until June 1, 1918, when it was raised one cent, and the price remained at 33 cents until it expired by agreement March 1, 1919. There is a considerable quantity of aluminum brought to the market each year through the resmelting of scrap aluminum, but no particular difficulty was encountered in dealing with this secondary product. With the United States in the war, the demand for aluminum for military purposes rose to ninety per cent of the production, and control of distribution was necessary. This was eflfected by the application of priority principles, the Aluminum Company being allowed considerable latitude of judgment in determining the relative priority of the orders, which consumers were authorized to place with it directly. When the Company was doubtful of the validity of its own judgment in this matter, it referred the ques- tion to the Non-Ferrous Metals Section. Secondary or resmelted aluminum was also purchased by consumers THE STORY OF COPPER, BRASS, ETC. 357 directly from the smelters, but only on the approval of prior- ity applications by the section. In the first part of the war the European demand for aluminum was chiefly for use in the form of dust to make an explosive in combination with ammonium nitrate. Other military uses of aluminum were found in the manufacture of mess, personal, and horse equipment, drop bombs, fuses, flares, fillers, hand grenades, heavy ammunition, rifle cart- ridges, and for airplanes, aeronautical engines, castings, and all kinds of engines. In normal times the chief industries using aluminum are the automotive industry, which consumes 15,500 tons; the steel industry, which uses 5000 tons as a deoxidizing agent; and the manufacture of utensils, which takes 12,000 tons. During 1918 the production of primary aluminum in the United States fell from the 100,000 tons of 1917 to 67,000 tons, because of a shortage of water power during the winter, and the situation became somewhat delicate. The Aluminum Company undertook to enlarge its capacity, but this was not accomplished before the end of the war. The control of aluminum was the perfect model of the War Industries Board's principle of concentration, because, outside of the secondary metal producers, the industry was in the hands of a single well-intentioned man, and did not necessitate even the friction that arises in a small committee. Even when it developed that the French importers were making a profit on aluminum obtained through the War Industries Board at the Government price, Mr. Davis, though protesting and asking for a rectification of this injustice, was never obstructive. Antimony is a metal that is produced within the United States only in negligible quantities. The bulk of American requirements are supplied by China. There are large deposits of antimonial ores in France — so the United States had only its own ordinary and military requirements to deal with. Nevertheless, the long trans-Pacific voyage gave rise to some concern regarding supplies, and at times there was a little touch of panic and a tendency to take what was ofi'ered at any price. In the peaceful industries, antimony is used in such alloys as Britannia metal, pewter, Babbitt \n 111! > )l ' ki .*. ^ « -' h . \ 358 INDUSTRIAL AMERICA IN THE WORLD WAR and other bearing metals, type metal and antimonial lead. Its oxide and sulphide are used in pigments, glassware, metal ware enamel, vulcanized rubber, and some other products. The chief military use of antimony during the recent war was for hardening the lead of shrapnel bulletSi^ About seventy per cent of the available supply was needed for this purpose. In the spring of 1917 there were only 200 tons of antimony in the bonded warehouses, and when it got abroad that the ordnance people wanted 3000 tons for immediate delivery, the price jumped from around 14 cents to 191/0 and 20 cents a pound. Mr. Meyer then took up the matter and found that 3000 tons could not be used for a long time. He accordingly arranged for buying in one-hundred-ton lots, with the result that the price gradually settled back to where it had been. By the end of 1917 the stocks in bonded warehouses were 5201 tons. In these circumstances, little or no control was required — only prudence in buying. In fact, there was no control, except that the War Trade Board put an embargo on exports. Needed supplies of the metal were bought from time to time on bids requested by the Non-Ferrous Metals Section at the instance of the Ordnance Department. The total requirements of the army, navy and Emergency Fleet Corporation averaged about 750 tons a month, and during 1918 the prices varied from 11.09 to 14 cents a pound. The only manipulation of importance in insuring an adequate supply of antimony was an arrangement made through the Treasury Department with the Wah Chang Company, importers from China, to let it have a certain amount of silver. There was an embargo on the export of silver from this country to China, which made antimony trading and exporting difficult. In this way the Government obtained a sort of grasp on exports of antimony from China, which made extortion impossible. As a precautionary measure some effort was made to stimulate the domestic production of antimony, and it was included in the War Minerals Act of Congress.^ *See Chapter XX. THE STORY OF COPPER, BRASS, ETC. 359 Lead was another of the sinews of war in which no real shortage ever developed, though Government dealings with the lead producers are a good example of the manner in which the War Industries Board prevented the artificial manipulation of prices when the relations of supply and demand were not normally productive of high prices. The Board never used a sledgehammer to kill a gnat; its weapons of priority, formal price-fixing, and commandeering never being used or even exhibited except where shortages due to emergency demands put the Government in the position of being the booster of the prices of its requirements. In general, the lead industry was simply informed that no manipulation would be tolerated. In line with his policy of securing initial raw material prices that would set an example and determine the later state of mind of the trade, Mr. Baruch, when dealing in the first days of the war with all raw materials personally, with only the aid of two or three executive assistants, obtained, through his Advisory Commission lead producers' com- mittee, a price of 8 cents a pound for Government orders aggregating 83,000 tons. At that time the New York price was about 11 cents a pound, as against 6.8 cents in the pre- ceding September. In this manner a tendency toward a runaway price was definitely checked. When the appointed lead producers' committee resigned in November, 1917, after the War Industries Board had decided on a sharp line of demarcation between trade committees and authorized representatives of the Council of National Defense, there was one directly negotiated purchase of lead, amounting to 5000 tons, at 5.425 cents a pound, St. Louis. However, it should be added that when the market price fell below 8 cents in October, the producers made good their early cooperative intention by voluntarily supplying the remainder of the 83,000-ton commitment at the market price. With the exception of the 5000 tons noted, all purchases after the original undertaking were made at the St. Louis market price, as recorded by the "Engineering and Mining Journal." Whenever a tendency developed unduly to control the market, the producers were mildly reminded that, while the Government had no desire to control this industry. ll M 1 : r "1 !!■ .M 1:1 :l 1/ 1 *i I ! 360 INDUSTRIAL AMERICA IN THE WORLD WAR it was incumbent upon them to maintain a price that would be fair to the Government and just high enough to bring out the needed volume of production. As a result the Price-Fixing Committee never had to interfere, and the price did not rise above 7.75 cents. There were signs of a shortage in August, 1918, due to labor troubles, hot weather, and the Government programme of building up a reserve to guard against transportation deficiencies. On investigation it was found that there was nothing alarming in the situation and that some of the pro- ducers had excessively large stocks. Still, it was considered the part of discretion to limit stocks to thirty-days require- ments and arrange with the Lead Producers' War Service Committee (organized in June, 1918, with Clinton H. Crane as chairman) to distribute supplies under the supervision of the Non-Ferrous Section. Owing to the particular shortage of sheet lead, J. R. Wettstein was appointed to pass on the relative importance of manufacturers' orders. An embargo was placed on the exportation of domestic lead, and the allocation of importa- tions was also turned over to the committee. No applica- tions for priority were required, though there was some conservation with the assistance of the Conservation Division. Lead for birdshot was curtailed, and tobacco manufacturers were restricted to 25,000 tons per annum for leadf oil which they had begun to use as a substitute for tinfoil. The use of lead in building was reduced somewhat, and zinc was substituted for lead in coffin linings and in the making of pigments. During the interval between the resignation of the original Council committee and the appointment of a war service committee by the industry, Irwin H. Cornell, acting for the producers, allocated requirements under the supervision of the section. The handling of lead prices and production throughout the war is an admirable illustration of how an industry, in the hands of a comparatively few proprietors and managers, can be administered without profiteering and without direct control when animated by a spirit of fair-dealing, and dealt with on the part of Government by business men devoid of the persecuting motive on the one hand or of the promptings of selfishness on the other. THE STORY OF COPPER, BRASS, ETC. 361 Nickel, like aluminum, is a monopolized metal, so far as American production is concerned. The International Nickel Company, a United States corporation, produces all of the nickel made in the United States, but the ore or the matte comes almost entirely from Canada, that country and New Caledonia, a French island in the South Pacific, having about the only important nickel deposits in the world. A little nickel originates in the United States as a by-product of the electrolytic refining of copper. As nickel is a monopoly and the holder of the monopoly was disposed to fair dealing, no formal control was required, and only such regulation of distribution as would insure the war needs of the Government and of the Allies. The qualities of nickel which make it important in industry are its resistance to corrosion and its contribution of tensile strength to steel with which it is alloyed. Nickel steel is used in rails, armor plate, bridge steel, castings, ordnance of all sorts, engine forgings and shafting (especially in automobiles and railroad cars). Monel metal is a nickel- copper-iron-cobalt alloy made directly from nickel ore which is largely used in warships. The total supply of nickel was not much more than war requirements. After our entry into the war, stocks were always at a low ebb, falling to only 267 tons in July, 1918. However, the only serious shortage was that of electrolytic nickel, used for rotating and driving-bands for shells and for bullet jackets, in the spring of 1918. This situation was met by using a percentage of shot nickel with the electrolytic. Conservation was effected by restricting the unnecessary uses of nickel and even by refusing its exportation to foreign governments for coinage purposes. Prices were never con- trolled, the Price-Fixing Committee merely entering into an agreement with the Nickel Company which confirmed the price the Company had been making. Since 1910, the ingot price fixed by the Company had ranged from 30 to 40 cents, the latter being the 1917 price. The Company offered to supply American and Allied requirements at 35 cents a pound for ingot nickel, 38 cents for shot nickel, and 40 cents for electrolytic, and this offer was accepted. Corresponding prices were made for monel metal for the navy. No price II !•■ v * ' 1 4 i \i < I \ 1 1\ 362 INDUSTRIAL AMERICA IN THE WORLD WAR for the public was made, as Government requirements, direct or indirect, about filled the market. The consumers on Government account made their purchases directly from the Company without priority applications, except in a few instances; the Company controlling distribution according to the wishes of the section, and determining priority of delivery according to its own judgment. Quicksilver is a metal of limited production and cor- responding demand in ordinary times. The extraordinary demands of war increased American consumption about fifty per cent, the increase being met almost wholly by increased domestic production, the imports remaining about the same as before the war. The problem of obtaining an adequate domestic supply was almost wholly one of price, as many mines are shut down at low prices; the number in operation varying from twenty-four to sixty-six. Spain has the richest and most cheaply worked mines, and, aside from a little recovered mercury that comes from Mexico, contributes a varying percentage of the American consumption. As it was desirable to encourage domestic production, there was not much haggling about the price, especially as the total amount involved was small. The total of military contracts during 1917 was 11,327 flasks, but the forecast for 1919 was 33,000 flasks — about equal to the entire domestic production. The chief military use of mercury is in the manufacture of mercury fulminates for ammunition. The navy and the Emergency Fleet needed it for anti-corrosive paints, and other uses were for medicinal purposes, for the "dope" of airplane surfaces, electrical apparatus, felt manu- facture, gold and silver milling, and certain industrial and scientific instruments. Practically no substitutes for mercury were developed, and the only conservation was through economy and an embargo on all exports except a small amount for the Canadian Government. Because of the narrow margin between possible supply and demand, and the tendency of prices to advance unduly, quicksilver was taken imder control early in 1918, but the Price-Fixing Committee did not act. Prices had been as high as $123.20 a flask, but at a conference between Mr. Yeatman and the producers on April 4, 1918, they agreed to i THE STORY OF COPPER, BRASS, ETC. 363 deliver to the Government at $105 a hundred-pound flask at Mare Island Navy Yard, California, and $105.75, Brooklyn Navy Yard. On account of the precarious nature of the business, it was not considered wise to demand the same price for the public, but the producers were informally urged not to let the price to the public get above $125 to $130. As for the importers, they agreed to give the Govern- ment forty per cent of their importations at approximately the same prices as the domestic producers. All Government demands except the Medical Corps of the army and the Emergency Fleet Corporation were by agreement handled through the navy and the Non-Ferrous Section; the two exceptions buying in the market. No control was attempted over the material not required by the Government, except the informal price limitation. However, the size of the Government requirements for 1919 indicated the necessity of extraordinary measures. Steps were taken to increase importations and the Price- Fixing Committee had called a conference on the subject of quicksilver, but the ending of the war intervened. The whole handling of the metals that came within the province of the Non-Ferrous Metals Section was a high type of the characteristic War Industries Board policy of sagacious expediency. Each metal was dealt with accord- ing to its peculiar relation to the general situation caused by the war. There was no standard form of regulation, and none whatever merely for the sake of regulation. i > ! I. 4 1 .1 I . // ! I ii: fi \ \i ft CHAPTER XX PLATINUM AND TIN I. Smuggling platinum from Bolshevik Russia — Bartering with the British for tin. n. Where the world's tin is — Tin and the "ring merchants" of London — Driving down the price and saving millions — Tin cans and the economics of war — Tin for bombs, fuses, and flares — A moral to be drawn. III. Platinum the indispensable — Twenty thousand ounces under ambassa- dorial seal — Requisitioning platinum, iridium, and palladium. The metallic elements of the materiel of war hitherto con- sidered are produced in the United States in sufficient quantities, with the exception of antimony, to make the Nation self-contained in the emergency of exclusion from foreign sources. And in a pinch, and at a high cost, we probably could produce from known domestic ores enough antimony to tide us over. It is true that only a negligible amount of nickel is found in the United States, but in the recent war it could be considered as a domestic product, not only because Canada, the chief source of nickel, was a neighbor and an ally, but because an American company is the chief miner of the Canadian ores, and because part of the smelting and virtually all of the refining is, or was, carried on on the American side. Two important metallic factors in industrial support of military effort are virtually entirely lacking in the realms of the Republic, namely, platinum and tin. Russia normally supplies from eighty to ninety per cent of the world's platinum, and most of the rest comes from Colombia. Tin production is largely within the boundaries of the British Empire. Thus, at the beginning of the war the sources of these indispensable metals were in the hands of our friends. The Russian revolution eventually resulted in the with- drawal of that country from the war, and the Peace of Brest-Litovsk placed Russia in the Teutonic colunm in an i PLATINUM AND TIN 365 industrial sense to the extent that the Bolshevik regime did not dissolve Russia as an industrial factor. After that untoward event the getting of platinum from Russia was a matter of intrigue and stratagem, conspiracy and adventure; and the meeting of war demands became one of manipulation, adaptation, and conservation at home, smuggling in Russia, and finance, exploration, and diplomacy in Colombia. In the case of the latter country there was even some effort to pivot the settlement of the Panama grievance and the confirmation of the Colombia Treaty, with its $25,000,000 for Colombia, on the Colombia protection of platinum. With tin the problem was one between friends, involving careful handling to enforce the American policy of reci- procity of materials among the Allies, which held that, as between Government requirements, at least, there must be an equality of prices and equitable allocation. It was an international contact of many phases. \i n Although producing no tin ore, except less than one per cent of its tin requirements, the United States^ is the greatest consumer and the greatest manufacturer of tin products, using more than half the entire tin output of the world. The British Empire controls about sixty per cent of the pig tin of the world, and the mining sources of the pig tin are in the Dutch East Indies, the Federated Malay States, China, Corn- wall in England itself, Wales, Portugal, Nigeria, Bolivia, South Africa, and Australia. The Malay States alone produce about half of the world's tin ore, and the chief portion of the world's smelting of the ore into tin is at Penang and Singapore in the Straits Settlements. The American imports of tin are in the form of pig from all of the above-named countries except Bolivia, which ships concentrates to the American Smelting and Refining Com- pany, at Perth Amboy, New Jersey. Although this domestic smelting did not begin until 1916, it produced more than eight thousand tons in 1918,^ while the imports were about ^Alaska yields about one hundred tons of tin annually. The Williams Harvey Corporation built a smelter at Jamaica Bay in 1918. 'I:) H tA 1 I'M it t i\ 1 1 11 1 1 1 I 1 1 1 t i •I . !« W 366 INDUSTRIAL AMERICA IN THE WORLD WAR ten times as great. The foreign tin supply was largely in the hands of the so-called "ring merchants" in London. In further complication of the situation the British Government insisted that all importations of British tin into the United States must be viseed and the bills of lading checked by the British consul at the port of entry. After this restriction was withdrawn and importations were put into the hands of the Pig Tin Committee of the American Iron and Steel Institute, further entanglements resulted from the refusal of the British authorities to give export licenses for shipment to American consumers who had not been importers thereto- fore. The next difficulty was in the scarcity of "Straits tin," which resulted in orders for Dutch East Indies tin. With four thousand tons of this tin undelivered, the Dutch tied up their ships, and there arose a shortage scare. As a result of these impediments and the manipulations of the London "ring," Straits tin sold as high as $1.38 a pound in New York in May, 1918, as compared with 31 cents in August, 1914. In consequence of the effectuation of the International Tin Executive in London in August, following negotiations begun in Washington with the British Embassy and Chandler P. Anderson, George Armsby, and Professor Lincoln Hutchinson in May, the price of pig tin at its various sources was reduced from a maximum of £443 a ton to £250, and would have been put down to £200. In consequence the price of spot tin in the United States went down to 71.5 cents a pound. On a year's importations this bit of inter-Allied diplomacy resulted in a saving of $62,000,000 to $75,000,000. Another result of the Tin Executive was to take the handling of the imports out of the hands of foreigners. The United States Steel Products Company, acting for the Pig Tin Committee of the American Iron and Steel Institute, bought all the tin allocated to the United States, which, by virtue of the cooperation of the War Trade Board, was the only licensed importer, and the Tin Committee attended to alloca- tion and distribution. Private importations of tin ore, concentrates, and tin chemicals were permitted subject to the approval of the Tin Committee, and even imported tin alloys, containing more than twenty per cent of tin, were put PLATINUM AND TIN 367 under control. The Tin Executive allocated 80,000 tons of tin to the United States as against 52,500 tons to the Allies. The tin control, it will be seen, did not involve activity by the Price-Fixing Committee, nor the application of priority in the ordinary sense. There was, of course, no committee of tin producers, but there were several trade committees of tin-users, through which the Tin Section maintained its contacts with consumption. This section was not created until March, 1918. Grafton D. Dorsey, of New York, was the first chief, but was compelled to retire on account of ill-health, and was succeeded by George Armsby, of San Francisco. Aside from the primary work of bringing about inter- national control of pig tin, the work of the section was largely concentrated on economy, conservation, and sub- stitution. Considerable attention was given to the recovery of tin from scrap. As tin is used in some form or degree by almost every manufacturing establishment in the country, conservation covered a very wide field. The chief use of tin is in the manufacture of tinplate as a protective cover for the iron or steel sheet. It was in the form of tinplate that tin chiefly entered into the economics of war, the former being indispensable in providing containers of foods, of which enormous numbers were required in alimenting our armies, civil population, and the Allies, as well as the neutrals to some extent. Conservation was mostly aimed at withdrawing as much tin as possible from other uses in order to provide sufficient for the tinplate industry. Even at that, the amount of steel allowed to each plate mill was reduced thirty per cent. Altogether the production of tinplate was maintained at a satisfactory rate; of the twenty-two tinplate plants the output in September, 1918, being 2,892,000 base boxes (a base box weighs 100 pounds). By November it was possible to authorize the production of 1,200,000 boxes for the oil industry and 125,000 for the bottle-stopper trade. Besides meeting all necessary American requirements, 55,887 gross tons of tinplate were spared to the Allies during 1918. Tin is used in large quantities in solder, in Babbitt and other bearing metals, in the manufacture of brass and II W :l!|i El I I ! V \ I .!• ]l 368 INDUSTRIAL AMERICA IN THE WORLD WAR bronze, in the manufacture of glass and rubber, in whitening enamel, and (in the tetrachloride form) as a mordant in the dyeing of silk and to give weight to the fabric. Besides its ordinary industrial uses, tin was especially required dur- ing the war for bombs, fuses, flares, and pyrotechnic explo- sives of all sorts, both as a producer of glaring effects, and of concealing-smoke. The conservation programme involved the curtailment of the use of tin in tinfoil and collapsible tubes, in reductions of the proportion of tin in Babbitts, alloy castings, and solder. The actual decline in tin consumption in 1918 was 9300 long tons, and the full application of conservation for a twelvemonth would have resulted in a saving of 13,000 long tons, or fifteen per cent of the estimated requirements of tin for 1918. The administration of tin involved the closest cooperation between the War Industries Board, the War Trade Board, and the Food Administration, to say nothing of the basic international cooperation and the team-work with and between the tin-using industries. In review, it now appears that there was never any real danger of an absolute shortage for restricted uses, notwithstanding the reduced production of tin in 1918, but it is equally true that, without inter- national control and centralized control within the United States, the price would have been appallingly high and the distribution of supplies so unequal that industry would have suffered severely. The handling of tin aflFords, perhaps, the best example of the international application of the War Industries Board's conception of the integration of industries and the pooling of their products under joint industrial and Government con- trol. America not being a tin-producing country, the Board reached out and pooled the tin of all the world, got an equitable share for the United States, and then measured it out prudently and carefully for the best interests of the military programme and the public. All of this was accomplished without the use of a cent of Government capital, the funds being provided in the first instance by the United States Steel Products Company. The war abounded in similar deeds of service by our business men and corporations that are little known. News, luifortunately. I PLATINUM AND TIN 369 is compounded of the sensational in crime rather than of excellence in well-doing. To swindle the Government is to get on the first page; to save it hundreds of millions is more likely to achieve oblivion. The fault lies in human nature rather than in the press. The world loves to hear of the evils it abhors, but cares less for knowledge of honor it demands. Ill Platinum is a metal that gratifies human vanity, and at the same time is one of the most indispensable of the metallic industrial agents. As its cost soared with scarcity in war-time, it arose simultaneously in demand for the manufacture of jewelry and for the enginery of war. The white fingers of women vied with the stinking vats of acid manufacture for its possession. The more the war demand drove up the price and gold sank relatively to plebeian levels of price, the more the favor for platinum jewelry. To the lay mind platinum is a metal of mystery and almost of necromancy in that its presence, but not its consumption, is required in the contact process of making concentrated sulphuric acid. The immense volume of this acid required in the manufacture of munitions as well as for ordinary industrial purposes gives platinum a unique economic importance. The next most important requirement for it during the war was in the erection and equipment of the nitrogen-fixation plants, which were designed to render us independent of Chilean nitrates both for munitions and industrial uses. The qualities of high fusibility, malleability, electrical conductivity, and chemical inactivity in platinum are unequaled, and as yet no adequate substitutes have been found for its most important uses. Alloyed with iridium, it is used in the contact points of ignition apparatus of all forms of internal combustion engines, and hence it is essential to the manufacture of airplanes and all sorts of automotive vehicles. It cannot be dispensed with in the making of heavy guns because its wire is the only known wire that can withstand the intense heat in the thermometer which is used in maintaining for definite periods the uniform I' i • lit V. I . (I I t:||l 1 I < I I I* : 370 INDUSTRIAL AMERICA IN THE WORLD WAR high degree of heat, the least departure from which will make the gun useless. It is used in ignition fuses, and in the chemical and physical laboratories it was of the greatest importance in the research work the war demanded, especially in connection with the use of gases and their neutralization. It is indispensable in the manufacture of ship compasses, chronometers, and many other instruments of precision. Surgery also makes its demands on platinum for surgical instruments and such apparatus as X-ray tubes, cautery tips, and hypodermic needles, and dentistry demands a considerable quantity. When the United States entered the war, it was confronted by a very limited supply brought about by the increased requirements of war since 1914 and the steady decline of platinum production in Russia as that country went steadily from worse to worst economically. In 1913, Russia pro- duced 250,000 ounces and all the rest of the world only 17,233. By 1917, the Russian output was down to 50,000 ounces, and, though the Colombia output had been brought up from 15,000 to 32,000 ounces, all the rest of the world produced only 685 ounces in the latter year, of which the United States' contribution was only 605 ounces. There is, however, a considerable amount of platinum refining in the United States, the crude platinum coming chiefly from Colombia. In addition, the recovery of secondary platinum from sweepings and the reduction of articles that have gone into the scrap-heap makes a considerable addition to the domestic supply, which under the pressure of war necessity went up from 40,698 Troy ounces in 1914 to between 60,000 and 70,000 ounces in 1918. As demand increased and supply decreased, prices ascended from around $39 an ounce in 1915 to $108 in 1917. It is to be noted that Mr. Baruch, as early as December, 1916, asked Secretary McAdoo to place an embargo on all platinum received at United States Mints, thus clearly foreseeing the impending scarcity and demand. The apprehension caused by the extreme shortage was relieved for a time in December of that year by the arrival from Russia of F. W. Draper, an American engineer, carry- ing with him 20,000 ounces of crude platinum, which was PLATINUM AND TIN 371 turned over to the Government for technical uses. Mr Draper had got this platinum together in Russia with the aid of other American engineers, the Russian-English Bank ot Petrograd, the United States Department of Commerce; and was assisted in his hazardous journey across Russia by the American embassy to Russia, the metal being carried under the ambassadorial seal. An element of business as well as personal adventure entered into this enterprise. Mr. Draper feh that he and his associates were well entitled to the American price ot $105, considering the risks they had run, the hardships endured, and the relief they had occasioned. In this view he had the sympathy of the Bureau of Mines, of the Depart- ment of the Interior, which was cooperating with the War Industries Board in the handling of the platinum problem. The War Industries Board was of a different view, recalling that it was due to the foresight of Mr. L. L. Summers, then associated with Mr. Baruch as technical adviser and later to become a member of the Board, that the Draper enterprise was undertaken, and that it could never have succeeded with- out governmental assistance. There was a line of cleavage between the Bureau of Mines and the War Industries Board all the way through on the platinum problem. The Board was not so "jumpy" on the subject as the Bureau, which was inclined to take a gloomy view of the platinum prospect on the assumption that the war might continue for several years, and did not proceed precipitately in conservation and requisition measures. The Board, while recognizing the situation as serious and taking measures to build up a reserve, felt that in the last resort the platinum in private hands, chiefly in the form of jewelry, would be ample to meet any future deficit. The difference between the two bodies is the difference that frequently arises between men with the scientific outlook and those with practical experience. The scientific men were deeply impressed with one phase of the platinum problem, that the practical men had not at first thought much about. Iridium and palladium are two precious and important metals that are found in association with platinum. Iridium was of military importance because '( 11^ I. . (I 1 !.li ' I » >illll r; 372 INDUSTRIAL AMERICA IN THE WORLD WAR of its use in connection with platinum for sparking points and magnetos; and palladium was useful in that it could replace platinum in dentistry to a considerable extent. In a report on the platinum situation, made at the begin- ning of 1918 by Dr. James M. Hill, of the Geological Survey, it was held that, while the outlook indicated that the platinum stores were sufficient to carry through 1918, there would be a deficit of about 1200 ounces of iridium and 11,000 of palladium. The palladium deficit was not a serious thing, but that of iridium was, and the Hill report emphasized the fact that there was no way to meet it except to procure 25,000 ounces of crude platinum which would carry with it sufficient iridium. "I cannot state too strongly the extremely serious situation in which we find ourselves," said Dr. Hill, "and urge that all possible steps be taken at once to do what can be done to rectify the mistake made early in the summer in not buying crude platinum." Dr. Hill was also much disturbed by the fact that two of the four platinum refining concerns in the United States were controlled by a man of German birth and most intimate German business associations who was reputed to be in control of the largest platiniun refining plant in Germany. 'His loyalty to the United States," the Hill report continued, is open to question, and it hardly seems wise to trust platinum refining to such a one, when it is realized that slight impurities in platinum for sulphuric acid plants render the catalyst valueless, or that more than 0.5 per cent of impurities in iridium for electrical alloys render the alloy ineffective." Here were the makings of a portentous industrial ambuscade. Dr. Hill recommended that to remedy the situation the Government should immediately dispatch agents to Russia and Colombia to procure all possible platinum and that all refining and fabrication should be done imder Government supervision. He also urged the immediate requisitioning of all platinum metals in the hands of refiners and jewelers. In accordance with these recommendations, the Platinum Section, which was organized in March with C. H. Connor in charge, began immediately to take steps to cope with the situation. One of its first discoveries was that requirements «( I 1 i 1 4 r fi I ii' w r 1 374 INDUSTRIAL AMERICA IN THE WORLD WAR trolled, and it was denied for pleasure cars, electric bells, electric advertising signs, clocks, photographic paper, electrical specialties, and many other purposes. It was found possible to exclude platinum from X-ray apparatus and to reduce its use in dentistry by seventy-five per cent (a saving of 22,550 ounces). Extensive conserva- tion was efifected by minimum use and substitution, many phases of the latter being brilliantly successful. AH the great industrial consumers of platinum studied substitution among them being the Ohio Salt Company, the North Ameri can Chemical Company, the National Electrolytic Company and the Western Electric Company. The systematic col lection of scrap had hardly started before the war ended but it had promising possibilities. But in July, August, and . September, the policy of encouraging consumers of platinum to turn in scrap in return for new platinum resulted in the reception of platinum scrap amounting to fifty per cent of the withdrawals of the metal. It was planned to stimulate domestic production wherever possible, and many mining prospects were investigated. The War Minerals Stimulation Law^ was not approved, however, until October 5, 1918, and in the interval before the armistice no enterprise was found that was deemed worthy of assistance. Few of the war materials developed such surprising fluctuations in requirements and so much resourcefulness and enterprise in meeting them. In July, 1917, not a single *This act placed $50,000,000 at the disposal of the President for use, virtu- ally at his discretion, in stimulating the production of minerals of which the war had revealed a shortage or an alarming scarcity. There was some rivalry between the War Industries Board and the Department of the Interior for choice as the executive agent, the latter feeling that, on account of the intimacy of the two great bureaus, the Bureau of Mines and the Geological Survey, with the subject-matter of the act, the administration properly belonged to it. On the other hand, the War Industries Board was f undamenully the Government agency dealing with the practical use of such materials. At the suggestion of Mr. Baruch, the administration of the act was allotted to the Bureau of Mines, but the War Industries £k)ard was authorized to determine needs and call upon the Bureau to apply the act to meet them. The termination of the war nullified the act, which otherwise might have been of great permanent as well as of emergency benefit. The minerals named in the act were antimony, arsenic, asbestos, bismuth, bromine, cerium, chalk, chromite, chromium, cobalt, cor- undum, emery, fluorspar, ferro-silicon, fuller's earth, graphite, grinding peb- bles, iridium, kaolin, magnesite, manganese, mercury, mica, molybdenum, osmium, sodium nitrate, palladium, paper clay, phosphorus, platinum, potas- sium, pyrites, radium, sulphur, tin, titanium, tungsten, uranium, vanadium, and zirconium. PLATINUM AND TIN 375 Government department reported any , need of platinum, but nine months later their requirements were put at 37,000 ounces for 1918, and, four months later still, they jumped to 70,000 ounces. At the same time the essential industries were consuming 3000 ounces a month. Then for 1919 it was figured that conservation and substitution would hold Government requirements down to 33,000 ounces of platinum and 1159 ounces of iridium. The creation of the International Platinum Executive, which was about ready for announcement at the end of the war, would doubtless have been of great assistance in meet- ing any unforeseen crisis that might have arisen had the struggle continued. ( I 1 a ,, ' ih I I 1 I i * I !, HI ii I I! I CHAPTER XXI FERRO-ALLOYS AND WAR MINERALS The steel industry jeopardized — Manganese and the lost collier Cyclops-— Sailing vessels bring chrome metal from Rhodesia — Basic policies of ravr materials procurement — Their operation vital to national defense — Tungsten and vanadium — Henry Ford, Baruch, and zirconium — Other precious minerals. On May 17, 1918, President Farrell, of the United States Steel Corporation, speaking in his capacity as a member of the Iron and Steel Institute's war service committee, warned the War Industries Board that the entire steel industry of America would be shut down by the following December unless manganese ore could be procured from Brazil. The statement laconically revealed the military dependence of the United States, with all its mineral wealth, on foreign sources for an essential of the production of the fundamental metal of warfare. Manganese was only one of the war minerals, as were designated ores and minerals which the United States drew impartially from foreign sources. The War Minerals Act list, printed elsewhere, names forty, but the chief of them, considered in the light of pressing war demands, were sodium nitrate, potash, pyrite, manganese, tin, graphite, asbestos, mercury, tungsten, vanadium, molybdenum, zirco- nium, chromite, magnesite, mica, platinum, iridium, and antimony. Nickel is a war mineral in which the United States is primarily dependent upon Canada, but, as already pointed out, the political, transport, and proprietary factors relating to it made it virtually a domestic metal of adequate volume during the recent war. Mercury, platinum, tin, iridium, and antimony have been considered in preceding chapters, and nitrate will be the subject of the following chapter.^ Of the war minerals already dealt with, all but tin, which was in a section by itself in Mr. Legge's administrative ^The more important war minerals not discussed in this chapter are more properly dealt with in Chapter XXIIl, relating to chemicals. FERRO-ALLOYS AND WAR MINERALS 377 division, were in the Non-Ferrous Metals Section of the same division. The remainder of the war minerals were assigned to the Chemical Division, in Mr. Summers's depart- ment of the Board, and were under the general direction of Mr. C. H. McDowell. Mr. Farrell did not overstate the position in his above- reported statement regarding manganese. Some form of manganese is indispensable in the manufacture of steel of almost every sort. It is commonly used in the form of iron-manganese alloys, spiegeleisen, and ferromanganese as a purifying agent. There are considerable deposits of manganese ore in the United States, notably in Minnesota, Montana, California, Arizona, Nevada, Virginia, Georgia, Tennessee, and Arkan- sas, but, as compared with the foreign ores, they are lean, hard to work, and costly of mining and transportation. Before the war the production of manganese ores in the United States was, therefore, negligible. But the military importance of self -containment and the scarcity of shipping made it important to produce as much ore at home as pos- sible. It was chiefly with manganese and other ferro-alloy minerals in mind that Congress, at the instance of the late Secretary of the Interior Lane, appropriated $150,000 in March, 1918, to continue and extend the investigation of domestic war materials, and later appropriated $50,000,000 to promote their production. Most of the imported manganese came from Brazil, and the long haul absorbed a great deal of shipping that could be used more economically elsewhere. Domestic pro- duction was automatically stimulated by the high prices, which were left to themselves for that very purpose, but, with all the gratifying expansion of such production that followed, it was still necessary to foster Brazilian and other foreign manganese mining. It was even necessary to divert precious shipping to the carrying of coal to Brazil for the use of the railways there hauling the ore to the seaboard. The reduction in the required standard of purity of steel extended the availability of American ores, and every effort was made to stimulate their production. But all of this required time, and at the height of the crisis the naval I M II flli f ■! 378 INDUSTRIAL AMERICA IN THE WORLD WAR collier Cyclops, with a cargo of manganese, was lost at sea, and 12,000 tons had to be imported from England. The price of high-grade ferromanganese, which was $37.50 a ton in 1914, went as high as $400 in the summer of 1917, but was unofficially stabilized through the efforts of the American Iron and Steel Institute at $250 a ton. Cour nected with the increased production of domestic ores was the problem of their reduction to the alloy form, which necessitated a considerable extension of furnaces suitable to that purpose. Both problems were successfully met. From a domestic production of ore, amounting to only 27,000 tons in 1916, the output soared to about 1,500,000 tons in 1918, though much of it was so low in manganese content that it was necessary to import 520,000 tons in the same year. The programme for 1919 contemplated the restriction of Brazilian imports to 250,000 tons, for it was then plain that in a last resort the United States could take care of all its manganese requirements with domestic ores. There was no conservation or price-fixing required in the manganese administration, the task simply being one of stimulating and facilitating production by lifting railroad transportation embargoes, getting priorities for mining machinery, the building of side-tracks, the obtaining of food and machinery supplies for the Cuban mines and of coal for Brazil, and of attending to innumerable details incident to a mining revival that covered the continent and involved scores of mines. Chromium or chrome metal is virtually indispensable in the making of armor plate, projectiles, high-speed tool- steels, motor vehicles, and airplanes. It is derived from chromite, a mineral ore, which was also used directly for bricks and cement for metallurgical furnace linings. Chrome salts are widely used in leather tanning solutions and pigments and as a mordant in the textile industries. As the ordinary sources are chiefly in Rhodesia and New Caledonia, importation under war-time shipping conditions was a grave problem. Steam vessels were not available, and recourse was had to sailing vessels. At the same time every eflfort was made to stimulate the domestic production of chromium, chiefly in Oregon and California. ' • M FERRO-ALLOYS AND WAR MINERALS 379 The rise in price from around $12 to $60 and $80 a ton lured prospectors and miners to the chromite deposits before we entered the war. The American production was only 255 tons in 1913; in 1917, it was 43,000 tons; and in 1918, 60,000 tons, as against total requirements of 90,000 tons. The imports for the year were 90,000 tons. The end of the war, therefore, found an excess of high-priced material on hand. This development was brought about, not only by the attraction of the high price which sent the prospectors into the hills and mountains and gave them a claim on the resources of speculators and capitalists, but by the motive of the adventurous public service and by the unstinted encouragement and assistance given, not only by the Ferro- AUoy Section, but by the Bureau of Mines and the Geo- logical Survey. The development of an industry in an artificial manner, when the industry cannot hope to survive, is in a measure an accompaniment of war, but is also an industrial tragedy. The chrome and manganese situations were similar. These experiences suggest that, in another emergency, producers of materials who cannot compete with importers in times of peace should have some guarantee against eventual loss, but whether the Government can aff'ord to develop an industry or inveigle capital into speculative enterprises, when the price of the material is five times the peace price, and in addition requires the Government to bear the capital expenditure, is a grave problem. There was a radical diff'erence of opinion between the experts of the War Industries Board and certain experts called in by the Bureau of Mines and the Geological Survey with regard to this policy. The fundamental difi"erence between the bureaus and the War Industries Board was that the bureaus asked all experts who joined them to work primarily for the benefit of the bureaus, the appropriations allotted to the bureaus being in a measure dependent upon the pressure they can put on Congress and the showing they can make. The War Industries Board was after results only, and results that would not paralyze or leave on industry a blasting and withering eff'ect. It felt that no form of Government subsidy or protection could possibly justify in h {\ I II 380 INDUSTRIAL AMERICA IN THE WORLD WAR peace-times the production of materials which could not be sold at a cost that would permit industry using them. It further felt that there was neutral shipping in the world that was not controlled by the Allies and which moved to the transportation of products where the prices were unduly inflated. The only control of this shipping was by refusal to permit the importation or exportation of certain goods. In allowing a high price of chrome and manganese and similar products, there became available an adequate ton- nage, and by closely watching the importation the War Industries Board felt that it could maintain a safe reserve of these important materials, and at the same time was whole- heartedly in favor of Government assistance being given to those mines or prospects which might develop commercial results or which could operate during the war, but whose capital expenditures would not be a total loss to be absorbed by the Government. In view of this policy, the War Industries Board granted at various times import licenses for chrome ore where schooners had arrived at New Caledonia and would bring high-grade ore at the agreed price. In the opinion of the War Industries Board, it was basic that in case of war the supply of raw materials must be accomplished through the expenditure of the minimum economic eflFort. The stimulation of the domestic pro- duction of a raw material should proceed only to the point of balancing with the limitations of procurement abroad. The Bureau of Mines held an opposite view, and clung, in the case of the ores under discussion, tenaciously to the doctrine of unlimited stimulation and absolute restriction of importation. The Government bureaus maintained that no chrome ore should be permitted to enter the country, thus intending to force prospecting and ultimately the adoption of low-grade ores regardless of the effects on the industries. At another time the Government bureaus recommended that all importation of manganese be prohibited and that the steel industry be forced to find a way to utilize very low- grade ores. The experts on the War Industries Board knew that this was an utter impossibility, and supported the steel industry in the position that it might mean the production FERRO-ALLOYS AND WAR MINERALS 381 of defective steel, which would be disastrous. They thus insisted on bringing in a certain amount of high-grade material about which there could be no question, and, while they were perfectly willing to do everything in their power to assist in American production within rational limits, they were bitterly opposed to unscrupulous developments of impossible prospects and mines at Government expense. Thus, when Congress appropriated $50,000,000 under the Minerals Stimulation Act, the War Industries Board was a party to the control of expenditures. Congress later seg- regated $8,500,000,^ to be used under the direction of the Secretary of the Interior, to compensate producers of manganese, chrome, pyrites, and tungsten for actually sus- tained net losses. The law was restricted to four minerals, and so limited in its application that it naturally could not be applied to compensate the irrational and unjustifiable ventures that had been undertaken. The wisdom of the War Industries Board policy was thus fully demonstrated. It would be utterly impossible to per- mit the production of a product at five to six times its peace price and then be forced to pay another five to ten times the value on every ton produced owing to the necessity of com- pensating for the capital expenditure. In other words, the policies of the bureaus counted on an eventual payment of from ten to twenty times the peace price with a total loss of the property, whereas under the War Industries Board policy, the price would be from five to eight times the peace price with a possibility of future development, and so long as shipping could be obtained from the neutrals that would not interfere with the military shipping, the price would not rise above the market prices which were really set by the War Industries Board through the granting of import licenses carrying a specific price for the product imported. The artificial stimulus given to impractical mining prop- ositions, through a perfectly honest but overzealous admin- istration of the Government bureaus, is a grave question, and should receive careful scrutiny in time of war. The Raw Materials Committee of the Council of National Defense, as early as April, 1917, made representations to ^Act approved March 2, 1919. 1^1 /. 382 INDUSTRIAL AMERICA IN THE WORLD WAR r !i the State Department with regard to chrome and manganese, and assisted in getting supplies to Brazil and in having adequate guards placed at railroad bridges and tunnels so that the Brazilian manganese supply was at no time imperiled, and its importation price through the import license system was at all times under control. Large Brazilian deposits eventually became the property of the United States Steel Corporation, and whereas, before the war, the American steel industry was practically dependent upon supplies from Caucasus and India, the American industry now has available a much nearer deposit of large magnitude. Manifestly there was little need for price con- trol. For a short time conservation seemed imperative, but in the last months of the war the object of the section's activities was to restrict importations and sustain the domestic market for the protection and relief of the men who had responded so quickly and eflfectively to the call for production. In 1916, tungsten ore, which had sold as low as $7.50 a unit of twenty pounds of tungstic acid content, sky-rocketed to $93.50. The domestic production was less than a thousand long tons in 1913, but under the stimulation of high prices it ascended to 4111 tons in 1917. There was feverish activity in tungsten mining in California, Colorado, Nevada, and Utah; but it was impossible to keep pace with domestic consumption, which went up to about 14,000 tons. As there was no possibility of the home output meeting the demand, and as tungsten ore in the quantity needed was not much of a tax on shipping capacity, there were no restrictions on importations. It was considered wise, also, to leave the market to itself, as it was freely responsive to supply and demand. While the domestic producers were appealed to for increased output, as a precautionary measure, it was not considered good policy to attempt to give them artificial advantages in the home market. Tungsten is essential in the manufacture of the alloy steels that were in great demand for high-speed machine tools in the war industries. Sixteen to twenty per cent of tungsten in steel imparts to the alloy tungsten's properties of high melting point, hardness, and toughness. In the FERRO-ALLOYS AND WAR MINERALS 383 rapid operation of machines intense heat is developed by the friction of cutting tools. Ordinary steel soon loses its temper in such a condition. Other uses of tungsten were in magnet steels, in steel for the valves of airplane engines, in X-ray apparatus, in electrical contact points, and for filaments of incandescent lamps. No satisfactory substitute has been found for tungsten in the manufacture of high- speed tools, though other alloys are also required. While tungsten was not much of a problem, vanadium required the closest attention. Only a little is produced in the United States, and the only considerable source is in the mines of the American Vanadium Company in Peru. Vanadium is used in high-speed tool steels, automobile steels, and steel castings which are subjected to heavy dynamic strains. The shortage was very great, which necessitated every possible economy and conservation. It was necessary to supply British manufacturers with Ameri- can ferro-vanadium, although they could be spared only fifty per cent of their requirements. Prices advanced from $2.21 to $4.76 a pound. No price control was necessary, but to insure control of distribution all importations of vanadium concentrates, as with the other ferro-alloy minerals, were consigned to the American Iron and Steel Institute, which operated through a committee on ferro- alloys. There were some interesting experiments and develop- ments during the war in respect of molybdenum and zirconium. Molybdenum was tried as an alloy in high- speed tools, and both it and zirconium were believed to be of exceptional value in the making of light armor plate, such as that of tanks. The Ford Motor Company, which had a large contract for tanks, was very enthusiastic about ferro-zirconium, to which it devoted a great deal of study, research, and experimentation. Both the army and the navy turned a deaf ear to the possibilities of the new alloy, and Mr. Ford appealed to the White House, where the matter was turned over to Mr. Baruch. This led to the pro- vision by the War Industries Board of an adequate supply of zirconium ore, and, in cooperation with the Electro- Metallurgical Company, a method of producing ferro- l*lrHv1 384 INDUSTRIAL AMERICA IN THE WORLD WAR zirconium was worked out. The interesting possibilities of the new alloy then attracted the attention of both the army and the navy, and there followed the formation of the Light Armor Plate Board, on which the War Industries was represented. Another steel alloy material with which the War Industries Board dealt was ferro-silicon, but here the only problem was that of securing adequate hydro-electric power for the manufacturers at Niagara Falls, as the ore is abundant. It is also used in the manufacture of hydrogen gas for balloons. In the War Industries Board's administration the ferro- alloys were finally placed in a section by themselves under H. W. Sanford, within the Qiemicals Division, but previ- ously both Messrs. Summers and Replogle had given much consideration to the problems they involved, and industrially they were more intimately associated with the work of the Steel Division than that of the Qiemicals Division. Asbestos is a mineral product for which the United States is dependent on Canada to a very large extent. Although during the war three mines with a satisfactory product were opened in Arizona, they are too far from railways to com- pete with the Canadian product. However, no international complications developed. In mixture with magnesium carbonate, mined in eastern Pennsylvania and California, asbestos is used for heat insulation of pipes, boilers, and furnaces, etc. The shipbuilding, aircraft, and motor-truck activities of the war required large quantities of this insula- tion. There was no control of the industry beyond placing it on the preference list and requiring observance of prior- ity, though without certificates. R. M. Torrence was in charge of this section, as well as that of chemical glass and stoneware. Metallic magnesium, which was in the province of the Miscellaneous Chemicals Section, was an entirely new war product in the United States, but by October, 1918, three plants were producing 30,000 pounds a month and one in Canada was turning out 15,000 pounds monthly. Pro- duction was far below requirements, and, if the programme of governmental aid had been carried out, it was hoped to FERRO-ALLOYS AND WAR MINERALS 385 bring production up to 115,000 pounds a month by the summer of 1919. England, France, and Italy were draw- ing on the American production, England alone calling for 250,000 pounds per annum. The metal was in demand for tracer bullets for the air services, artillery shells, alloys for castings, as a substitute for aluminum, and in gas masks; also as a flux for malleable nickel and monel metal, as a deoxidizer, and for flashlights. Mica was more of a problem, as only the lower grades are found in the United States and the best quality is imported from India via England. The British Government made allocations to the United States, subject to Govern- ment control, which was eff'ected through a naval com- mandeering order of imports. The commandeering order was later extended to imports from South America. Prices fluctuated greatly, but were stabilized to some extent through the commandeering. There was a demand from domestic producers for governmental assistance, but, after a thorough study of the subject by the section and the Association of Southern Mica Miners and Manufacturers, it was decided that neither stimulatory price-fixing nor any price-fixing would be of much avail, as there was little prospect that the Government use of domestic mica could be increased. Assistance in labor priority and the advisory encouragement of new industries was recommended. Mica was of war-time importance because of its use in spark-plugs, radio appa- ratus, telephones, magnetos of airplanes and automobiles, electric generators, etc. Other uses are in the chimneys of gas lights, stove windows, and in the fabrication of decorating paints and building materials. H. J. Adams was the first chief of the section and was followed by J. W. Paxton. It was later recognized and placed in the Chemicals Division under C. K. Leith. Lieutenant C. P. Storrs, a mica expert in the navy, was the chief factor in directing the control of imports. In concluding this partial sketch of the so-called war minerals, ample credit should be given to the Department of the Interior, the late Secretary Franklin K. Lane, the department's Bureau of Mines, and the Geological Survey. Secretary Lane might be styled the great mobilizer of (I 386 INDUSTRIAL AMERICA IN THE WORLD WAR the subterranean war resources of America. He was the spiritual war leader of the miners and metallurgical scientists and workers, who did their part in the war with pick and shovel and drill, with laboratory, smelter, and refinery. The Geological Survey combed the United States and even foreign countries for the minerals that were scarce, and the Bureau of Mines was tireless in determining the economic value of discoveries and in encouraging their utilization. The cooperation of the Department of the Interior was invaluable to the War Industries Board as the great purveyor of raw materials, and while distinct differ- ences developed, as is always the case when engineer and producer, scientist and artisan, principle and practice meet, there was on the whole effective team-work between the Department and the Board. t»< t ! CHAPTER XXII THE WAR IN THE NITRATES AND POTASH SECTOR The vital need for nitrates — Why Von Spee sought Craddock's squadron — America ignores lack of nitrates — In the war, and no nitrate reserves — Baruch and Summers take bold steps — The navy intercepts a message to Berlin — Baruch and Summers beat down the price — Securing control of Chilean sources — Nitrate shortage a constant specter of defeat — Developing potash from brine — Potash for powder, optical glass, and gas masks — Ogden Armour asks MacDowell a question — The nitrate lesson — Have we learned it? The World War was, of course, distinguished from all pre- ceding wars of modem times by the fact that it was a stubborn contest between the whole moral, economic, scientific, and industrial as well as the military forces of the combatant nations. It was a one hundred per cent war of nations as opposed to the old restricted wars carried on between clearly defined units of the belligerent nations, designated as armies and navies. Strictly speaking, there are no longer any non-combatants, for, even if the narrowly non-military forces of a nation are not producing the equipment and supplies of the combatant forces, they are at all times directly in the field against the enemy in the domain of morale, thought, propaganda, scientific research, and industrial and commercial pressure and achievement. In the United States the War Industries Board stood for the industrial corps of the nation-army with extensive aux- iliary forces in commerce and science. It carried on its part of the war in well-defined sectors corresponding to the classifications of industries and materials, and always visualized itself as an industrial and economic army belligerently opposed to corresponding agencies in the enemy nations. No part of the industrial-military grapple was more tense and breathless than that of the nitrate sector. For on nitrates are based the dynamics of projectile warfare. As water is to steam, so are the nitrates to the power that resides in explosives. On the side of the Allies the nitrate sector was entrenched in the dead plains of Tacna and Arica, \\ J«i 1' . 11 . It 388 INDUSTRIAL AMERICA IN THE WORLD WAR where, ten thousand miles from the battle contacts in France, are found the only important nitrate deposits in all the world. On the side of the Germans, nitrate power was based on a highly developed industrial chemistry which was capable of producing all the nitrates her war engines might consume. It was not a purposeless adventure that brought Admiral Von Spec's fleet across the Pacific to destroy the squadron under command of Admiral Craddock in the battle of Cor- onel oflF the nitrate coast. To strike at the source of the Allies' nitrate supply was to paralyze the armies in France. The destruction of a nitrate carrier was a greater blow to the Allies than the loss of a battleship. With American fire- arms added to those of the Allies, the demand for nitrates exceeded the possible production and enforced the greatest economy and nicety of distribution to hold the fort, whilst frantic efiforts were being made to bring art to the support of nature in the shape of nitrate-making plants. All the men and aU the cannon America might bring to Armageddon would be powerless if the rusty tramp steamers could not maintain their drab procession from Chile to the ports of America and of the Allies. Nor was that all, for the fertility of the gardens and fields, whence the Allies drew their food supplies, depended in no small measure on the nitrates of Chile. Nitric acid, which is made from nitrate of soda, is used in mixture with sulphuric acid to manufacture both pro- pellants and high explosives. Bleached cotton linters, on being nitrated, become nitrocellulose, the chief propellant. If toluol be nitrated, the product is T.N.T.; if phenol, picric acid; and so on in the production of other high explosives. Not only are nitrates used in the form of nitric acid in mixture with sulphuric acid, but they are used to make sulphuric acid by the chamber process. So, as far as the Allies were concerned, the mighty forces that hurled their bolts in France, Mesopotamia, the Balkans, the Alps, at Jutland and Falkland, were latent in the Chilean deserts and nowhere else. Thus, even in the chemistry of warfare, the New World was called in to restore the balance of the Old. THE WAR IN THE NITRATES SECTOR 389 The precarious situation of the United States with respect to nitrates was well understood, but virtually nothmg was done to build up stores before our entry into the war, though General William Crozier, then Chief of Ordnance, had become deeply concerned over the situation a year earlier. The Secretary of the Interior offered the War Department the cooperation of his organization. General Crozier con- ferred with Dr. C. L. Parsons, chief chemist and chief ot the division of technology of the Bureau of Mines, regarding the nitrate supply, and the Geological Survey instituted exhaustive but vain explorations in the hope of finding nitrate deposits within the United States. , tvt • i In the following June the Congress, in the National Defense Act, authorized the President to direct an investiga- tion as to the best means of producing nitrates and nitrog- enous materials used in munitions and in fertilizers and other products and to have constructed such plants as might be deemed necessary, $20,000,000 being appropriated. ^ There followed about a year of investigation and experi- mentation, the War Department, the Bureau of Mines, the Department of Agriculture, and the National Academy cooperating. The War Department paid the expenses of Dr. Parsons and Eysten Berg, an engineer, familiar with the nitrogen-fixation process in practical use in Norway, for a trip to Europe to study methods of manufacturing nitric acid otherwise than from sodium nitrate. Arrangements were made with the Semet-Solvay Company to erect a plant to determine whether ammonia could be commercially oxidized to nitric acid. The American Cyanamid Company had been experimenting with the oxidization of ammonia in the cyanamid form and permitted scrutiny of its plant, but withheld certain details. The Bureau of Mines under- took studies of the oxidization process at Pittsburgh and with the chemists of the Semet-Solvay Company at Syracuse, and a small experimental plant, similar to the Cyanamid Company's plant, was erected near Syracuse, platinum gauze being used as the catalyzer. Messrs. Parsons and Berg did not return from Europe until the last days of the year. The former made a pre- liminary report in January and his final report to the Sec- \ ! ••■i mil il « ( I I ^ i n i It I h I! 390 INDUSTRIAL AMERICA IN THE WORLD WAR retary of War on April 30, 1918. Meanwhile a committee of the National Academy had been making studies, and turned in its report to the Ordnance Department on May 11th. The two reports were examined by a special com- mittee of experts and practically all of Dr. Parsons's recommendations were adopted. Eventually the War Department undertook the erection of four plants, one at Muscle Shoals, and one at Sheffield, Alabama, using differ- ent forms of the ammonia process, and the others in Ohio, for the fixation of nitrogen from the air. In the meantime the United States was well into the war, and had neither nitrate reserves nor commercial manufacturing plants. Indeed, the war came to its end before the new works were completed; and we are as precariously situated to-day for a nitrate supply as ever. Messrs. Baruch and Summers had become worried over the nitrate question for some weeks before the United States declared war. The latter had been, in his professional capacity, in close touch with the French and British supply officers in the United States, was thoroughly aware of the enormous explosives requirements of modem armies, had closely watched for ten years the development of artificial nitrate production and the coal-tar industry in Germany, and was deeply impressed by the scarcity of sodium nitrate and toluol (for the manufacture of T.N.T.). Nitrate prices jumped thirty-three per cent when the United States declared war and another hundred per cent within three weeks. Congress had made no appropriations for purchases by the Government, and the manufacturers of explosives were taking options right and left on all sorts of materials, thus creating a fictitious demand and an artificial shortage. The whole world, outside the Teutonic combatants, was frantically buying, and Chile had all the nitrates there were. It seemed as if nothing could be done. Then, without a cent to buy with, and not knowing of any nitrates that could be bought if they had millions, the Raw Materials Division announced that it would not be necessary for bidders for munitions contracts to attempt to procure nitrates either by inquiry or option. Not only that, but bidders were told to figure their contracts on the assurance THE WAR IN THE NITRATES SECTOR 391 of getting nitrates at four and one fourth cents a pound, though at that very moment the market price was around seven and one half cents. At the same time there was much talk concerning the fixation processes. Buyers lost their eagerness and the Chileans were scared. They were sure the Raw Materials Division had a card up its sleeve. Even the large importers of nitrates were mystified. Then Baruch and Summers carefully watched for some- thing to make good with — and stumbled finally on the solution. The Naval Intelligence Office one day picked up a message from the Chilean Government to Berlin regarding the gold reserves the former had on deposit in Berlin. It wanted to get them released. The German Government absolutely refused to comply. Quickly the suggestion was made to the Chilean Government that the United States would supply the necessary gold if the former would con- fiscate the stocks of the German-owned nitrate plants in Chile, Germany being a large importer of sodium nitrate for use as a fertilizer as well as for military stocks. These had been compelled to close through economic measures taken by the British Government, which shut off their sup- plies of fuel, jute bags, and other necessaries, but they had 235,000 tons of nitrates on hand. The Treasury supplied the gold, and the British waived their Trading-with-the- Enemy Act to permit the shipment of bags from Calcutta and also provided the loading facilities and ships. As the Allies, through their American contracts for explosives, would share in these German nitrates, they were agreeable to a proposal that was now made to them to help the Raw Materials Division rig the market, which was that they should withdraw from the nitrate market for the last three months of 1917. The disappearance of buyers, coupled with the announcement that all the German nitrates in Chile had been seized and sold to the United States Government, left the producers "up in the air" with a record production and no market. Nitrate prices broke so rapidly that Chile threatened to be overwhelmed with a financial panic. The Raw Materials people had no desire to precipitate a real panic in Chile, bui the apprehension of a panic was grist for their mill; arrangements were made to sustain the market >l(t ) t I I ^p: 392 INDUSTRIAL AMERICA IN THE WORLD WAR at a fair price and the international speculators were put to rout. The promised price of four and one fourth cents was beaten by an eighth. There could be no better illustration of prophetic vision. Out of this brilliant maneuver grew the International Nitrate Executive, which was merely a monopolistic pool of the buying power with which to meet the Chilean producing monopoly. It was made up of representatives of France, England, Italy, and the United States. Its offices were in London. On the part of the United States legitimate trade interests were protected by providing that the importers should purchase through the International Executive certain fixed proportions of the total amount of the Chilean pro- duction allocated by the executive to this country. To coordinate and supervise the operations of the importers, a nitrate committee was established in New York with H. Ray Paige, representing the War Industries Board, as manager. The members of the committee were representatives of the importing houses.^ The latter were bound to deliver their imports as directed by the War Industries Board, receiving for direct Government purchases only actual expenses of transactions in addition to cost of material, and for other purchases a gross commission of two and one half per cent. The outcome of the international pool was that complete control was secured over the Chilean nitrates. Buying was as sparing as possible, and all the time great interest was kept up over the wonderful progress being made on the artificial nitrate schemes. On the other hand, the entire Chilean nation was interested in realizing the largest pos- sible production of nitrates as the mainstay of national pros- perity. In the early summer of 1918, the shortage of coal, fuel oil, bags, and rolling stock for the railway from the nitrate fields to the coast became so severe that the earlier situation was entirely reversed, and the Chilean Government made a special oflfer of 680,000 tons to the Allies on condition that the needed supplies be forth- ^Under this arrangement 36 2-3 per cent of the American share of nitrates was handled by W. R. Grace & Co. ; Du Pont Nitrate Company, 33 1-3 per cent; Wessel, Duval & Co., 111-3 per cent; H. J. Baker & Bro., representing Anthony Gibbs & Co., 182-3 per cent. THE WAR IN THE NITRATES SECTOR 393 coming. Through the intimate cooperation of Winston Churchill and Baruch the offer was accepted. France was so nearly out of nitrates that supplies intended for American agriculture and some others, amounting in all to 61,000 tons, had to be diverted to that country. On May 1st, the American stock had dropped to only six weeks' con- sumption. This transaction was carried through by the International Executive, to avoid conflict, and the 680,000 tons were allocated by that body to the respective members of the pool. All of the foregoing train of events had its origin in a chance meeting between Senator Smith, of South Carolina, and Mr. Baruch. Congress, alarmed by the untoward pos- sibilities of a lack of nitrates for fertilizer, had placed funds at the disposal of the Department of Agriculture for the purchase of nitrates to be distributed to the farmers at cost. The Department had not obtained any nitrates under this authority, and Senator Smith, representing an agricultural constituency, undertook to push things a little. He went to the President, who referred him to Baruch; from whom he learned that nobody had any authority to deal with the problem. The Senator went back to the President, who told him that Baruch would have his support in handling the matter. Starting in with this leverage of authority, the Raw Materials Division rapidly grew into the whole job. Mr. Summers, qualified with a profound knowledge of the subject, and as Mr. Baruch's assistant in charge of chemicals, explosives, and propellants, engineered the job. He had the cooperation of Charles H. MacDowell, of the Armour Fertilizer Company, who was a member of the Advisory Commission Committee on Chemicals. In November, 1917, Mr. MacDowell took charge of nitrates and other chemical materials in the Chemicals and Explosives Section. When the Chemicals Division was created, he became the director of it.^ The farmers never got, during the period of the war, all the Chilean nitrates that Senator Smith was after, but they *No attempt will be made to deal comprehensively in this text with the personnel of the numerous sections that had to do with chemicals and explo- sives. Full information in that regard will be found in the Appendix. I 1 i \ I i I I f* 'If .1 394 INDUSTRIAL AMERICA IN THE WORLD WAR did not grudge the diversion that kept the French guns busy in the spring and summer of 1918. Other nitrogenous materials were substituted to some extent, and with special care the crops of 1918 came through in good shape; but the outlook for 1919, with cumulative defertilization to be faced, was rather gloomy. The military demand for sodium nitrate was expanding, shipping was scarce, scheduled sail- ings were always off; locomotives, coal, oil, and jute bags to keep the oficinas going, were always a source of perpetual worry. Every once in a while a German submarine would sink a poor old tramp almost at the end of its long voyage — and the whole nitrate situation was just one thing after another. At one time the diversion of a single vessel loaded with nitrates from the United States to France was all that pre- vented the stoppage of explosives plants in the latter country. Even England had to be helped. The minutes of the War Industries Board, correspondence, diaries, and recollections abound with apprehensive references to the nitrate situation. The International Executive controlled the price beyond doubt, but the practical problem of keeping up production by providing the implements of production was all with the War Industries Board, which was forever haunted by the specter of a war won or lost by some mishap in the far-away Chilean deserts or in the waters between. The United States estimates alone for 1919 were put at 2,321,086 gross tons, of which the strictly military needs were 1,894,562 tons, and there was no chance of increasing the supply in 1919. The only answer was in the nitrogen synthetizing and am- monia nitrate plants then building — and, indeed, the whole programme of the War Industries Board had been to hold the fort until they should come into production. That was at best a problematical arrival. Explosives and fertilizers are antithetic children of nitrogen and potash. Differently applied, these great elements of agricultural production become the chief imple- ments of destruction. To divert them from the soil to the guns is simultaneously to promote destruction and restrict production. Germany struck at the agricultural pro- ductivity of the United States, and, indeed, of all the Allies, ^^ r*- '^^ *i^.^ ftr ^^T fi> (C'-r tBr ff,^ mir , I v.\ •!'! ■■"TW *t 5^ 0) 3 h w 08 C T3 o o »; c8 V" cS H u S K i) u -~ CO «^ o «6-J3 u O - o ^ ^ OS V « c 'c o « O « , ^-2 ^-3 .^4 V C ^ (3 « > i &n < o Ui H 32 Q • a) 2< •a u O c S3 .. «i/ C ^ O G OD Ph KQ O ^ OO Q — ^ OS .S ^ -a S . « jz ^ o o -^'a 01 c a O o GO c oi «»- 'z: W O O 3 _ ■3 o > a V 00 a 0) a 03 £ CO « 03 o •«• 2 c 01 a S s 08 0) ■4^ CO .s « 2t3 • 01 o l> .. *j o On M < 2i :» J « ^ - ^ ;§ " ^- g CO •- ♦* rs .-aw 5 Jo s c« ^ 2 O -2 ^ c J» O 02 OD > 'S a S 03 ^ ^ ago 2 O « -00 ^ ° OS ;;: U ^ - C E -< J= ^ 03 » o = -5 'S "^ 03 •- »- OQ « o x: o v hi 01 CD 03 o K gffl s 5^ c s 2 O • • 02 C 3 I - O 08 o O - OB "O E 03 0) .5 ^ s «°° OJ 0, "V is U 0] wf et «= *5 08 B 03 t. <: o o H q3 . o ►-• CI • 08 "S *■ &< -^ o w c-S S e c I g.2 W "3 eS o s >: O 8! O £ • 2 «£^ 2 ■§§* js o ta 02 "-5 « • S O dS§ c 03 a 5^ go >» SOh n ^ ?' O O 4> 3 5-2 Ix 08 3 !i. ii '4 i INTENTIONAL SEC OND EXPOSURE i-f ■ I I •i I < I 394 INDUSTRIAL AMERICA IN THE WORLD WAR did not grudge the diversion that kept the French guns busy in the spring and summer of 1918. Other nitrogenous materials were substituted to some extent, and with special care the crops of 1918 came through in good shape; but the outlook for 1919, with cumulative defertilization to be faced, was rather gloomy. The military demand for sodium nitrate was expanding, shipping was scarce, scheduled sail- ings were always off; locomotives, coal, oil, and jute bags to keep the oficinas going, were always a source of perpetual worry. Every once in a while a German submarine would sink a poor old tramp almost at the end of its long voyage — and the whole nitrate situation was just one thing after another. At one time the diversion of a single vessel loaded with nitrates from the United States to France was all that pre- vented the stoppage of explosives plants in the latter country. Even England had to be helped. The minutes of the War Industries Board, correspondence, diaries, and recollections abound with apprehensive references to the nitrate situation. The International Executive controlled the price beyond doubt, but the practical problem of keeping up production by providing the implements of production was all with the War Industries Board, which was forever haunted by the specter of a war won or lost by some mishap in the far-away Chilean deserts or in the waters between. The United States estimates alone for 1919 were put at 2,321,086 gross tons, of which the strictly military needs were 1,894,562 tons, and there was no chance of increasing the supply in 1919. The only answer was in the nitrogen synthetizing and am- monia nitrate plants then building — and, indeed, the whole programme of the War Industries Board had been to hold the fort until they should come into production. That was at best a problematical arrival. Explosives and fertilizers are antithetic children of nitrogen and potash. Differently applied, these great elements of agricultural production become the chief imple- ments of destruction. To divert them from the soil to the guns is simultaneously to promote destruction and restrict production. Germany struck at the agricultural pro- ductivity of the United States, and, indeed, of all the Allies, „ 1^ w CD c3 o ^ « ■«' . O C X 4) __ jS ^ it '^ £ -2 < ^50 c 3 c "^ c « o o H J^ ^ O. p-S ^^ ^ ^ *^* ^\ C to .2 § ^ W T3 > pa =3 Oi .C W 5 CO . . a u in a c 0^ S c o Hi HN O Jr — -2 -S 5 c s I' -- _ (« S3 _, C 0) ^ ^ ■ J; o > O 02 "• '^' ^ 1= :>• "H S Jo I i:a S < op ;== O M-| Z: ^ ^ ^ C S c3 x: -is ct' a J? J ...J: = ^- «- -^.2 ^ -5 t 3 *j »™ ^ •-" o . o J o ^ ^ — hi ^1 U 2.2 •- ** •-^ 9 o ^ *^ S; u OS c ■- e] C CO ^ > O i: ^ < 2 G . . o o 03 X 11 = £ «.2 4) EC •= OS . >■ T3 ■■= "3 K O E- ~ ^ - 2 r^' - in ^ c a: < -c J*» ^4.' t: . t; a; .- f^ « •= "c c - « 83 0) o - S ^ OS __ . . ^ _ ill ""^ c Qi u c .2 C o 0) (1| S o ^ 00 >> el 3 -^ H O c? ^ Q H OS < »5 y •i I I 1 k i T I < I St THE WAR IN THE NITRATES SECTOR 395 by forcing the farmers to forego for a time an element of fertility through the diversion of sodium nitrate to military needs. This was probably an unforeseen economic blow. But the moment she declared war she knowingly struck a blow in the same vital spot through her potash monopoly. Indeed, there were proud boasts that Germany had only to hold out for a certain period to compel the Allies to sur- render to starvation, even though victorious in arms. At the beginning of the war, Germany had at Stassfurt in Saxony, and in Alsace the only commercially available sources of potash in the world, yet potash is absolutely necessary for the maintenance of fertility in certain soils, especially for the growing of wheat, potatoes, and cotton. Potash is also used, though not in relatively large quantities nowadays, in the manufacture of black explosive powders and for many industrial purposes. As soon as the blockade of Germany cut off the flow of pot- ash from that country, there began an energetic and wonder- fully successful attempt to produce potash in this country, in which the Geological Survey played an important part. The first commercial success was scored in the evaporation of the brine of certain alkaline lakes in the Nebraska sand hills, and later from the Searles Lake deposits in California, brines and alunite in Utah, kelp on the Pacific Coast, etc. By 1918, it was plain that the United States was, and, at a price, could be made perpetually, independent of foreign sources. As with the other war minerals the coming of peace about wiped out the potash industry, in which $25,- 000,000 had been invested, it being unable to compete with the Stassfurt and Alsatian deposits, the latter, of course, falling to France with the cession of Alsace. While with potash, as with nitrate, the Department of Agriculture was chiefly concerned in dealing with the fertilizer requirements, the Chemicals Section of the War Industries Board was closely related with it on account of military requirements. Aside from the potash required in the manufacture of powder, it was, in the carbonate form, essential to the war-created optical glass industry, and as permanganate in the manufacture of gas masks. The Armour Company was making six or eight hundred pounds 11 I I « •; m n 396 INDUSTRIAL AMERICA IN THE WORLD WAR a week of the latter, and the entire production was turned over to the Government for a time at cost. The Geophysical Laboratory, in its study of optical glass, called on Mr. MacDowell for the carbonate. He recalled that the Armour plant working on alunite had turned in a few pounds of very pure carbonate; but the Laboratory required two or three tons a day. Before committing himself, Mr. MacDowell wired to his chief in private life, Mr. Ogden Armour, advising him that it would require an investment of $30,000 by the Armour people, with no possibility of getting out even, to meet the optical glass requirements. "What in the devil are you down there for?" was Mr. Armour's answer. The local managers said it would take three months to install the plant. Mr. MacDowell gave them three weeks — and inside of that time the plant was producing a little over a ton a day. The nitrate struggle is, perhaps, the most vivid illustra- tion of how indispensable to military efficiency is an intelli- gent and energetic civil body, such as the War Industries Board, in dealing with problems that must be solved if the military are to succeed and yet are foreign to military knowledge and experience. In spite of this and a thousand other illustrations that may be drawn from the bitter experience of the World War, the National Defense Act of 1920 makes no provision for what the war showed to be our greatest weakness — the absence of an organized liaison between the striking and the power-creating forces of the Nation. CHAPTER XXIII EXPLOSIVES AND CHEMICAL WARFARE Chemical action in modem war — The Board takes control of sulphur pro- duction — Five hundred thousand tons of sulphuric acid monthly attained — Nitric acid, caustic soda, chlorine — The mighty cotton linter — The role of alcohol — Summers warns of the T.N.T. need, and the army learns a lesson — Our powder on the Western Front — America's explosive problem and pro- gramme — The plant at Muscle Shoals — Pershing cables imperatively — The Board protests the Du Pont contract — Baruch calls in Jackling — What civilian experts did in producing smokeless powder. The arrows of the British bowmen, which won the field of Cressy for the Black Prince, and the artillery that Froissart tells of in his accounts of sieges of mediaeval castles, were actuated by mechanical power. So it has been since the throwing-stones of the Neanderthal man. But since Con- stantinople fell to the Turks, projectiles have been driven by chemical force. The fighting weapons of modern nations depend almost entirely on the force released by chemical action. Perhaps the final phase of warfare will be the direct use of chemicals, as exemplified in the toxic gases of the recent war. At any rate, war has become chemical warfare. In the last analysis warfare in the twentieth century is very largely a matter of nitric and sulphuric acid. The preceding chaptei* sketched the story of the raw material of nitric acid. There remains to be told something of sulphuric acid as an implement of combat and something of the forms the products of these two fundamentals of war take in their final form as controllable explosives. As we have seen, sulphuric acid is used in combination with nitric acid to eff'ect the nitration of certain materials for the purpose of making explosives. Before 1917, the large part of the sulphuric acid manufactured in the United States was made from pyrites ore imported from Spain. The activities of German submarines and the tremendous demands on trans-Atlantic shipping made it necessary to turn to home resources, which were found in the pure sulphur of Louisiana i * i I f : ] Ill 398 INDUSTRIAL AMERICA IN THE WORLD WAR and Texas, Canadian and domestic pyrites, and in the waste gases of copper and zinc smelters. The problem was to make these sources not only yield substitute amounts of pyrites, but to meet the demand for larger production. A largely increased production of domestic pyrites, chiefly in the South, was effected; but the long, expensive, and time- consuming haul from the Colorado, California, and other Western sources made it impossible except, as a last resort, to rely on pyrites. The brunt of the burden fell on the brimstone mines, ninety-eight per cent of the production of which in the entire country was in the hands of the Union Sulphur Company and the Freeport Sulphur Company. The sul- phuric acid requirements for explosive purposes were esti- mated to be 9,000,000 tons for 1918; 300,000 short tons of sulphur were needed for the paper pulp and other industries, and the Allies were in need of 150,000 tons. The outlook was that the brimstone mines ought to produce 1,500,000 tons, whereas their maximum capacity, as developed, was not more than 1,300,000 tons, with produc- tion actually going on at the rate of only 1,200,000 tons in the spring of 1918. In these circumstances it was held wise for the War Industries Board to take entire control of the product of the mines. This was done by the Sulphur and Pyrites Section in cooperation with a committee of the Chemicals Alliance. With the assistance of the Shipping Board and the Railroad Administration, arrangements were made for expediting cargoes by sea and through trains by land. The price of sulphur, by agreement with the fertilizer sub- committee in the spring of 1918, had been fixed at $22 a ton, in harmony with the Raw Materials Division's basic plan of stabilizing the prices of materials in advance of the bulging demand. This price, which was the normal pre-war price, was maintained for Government requirements, direct or indirect, although market quotations stood at $35. Thus sulphur affords another brilliant example of the remarkable manner in which the War Industries Board held down the prices of materials. The production of sulphuric and nitric acids was under EXPLOSIVES AND CHEMICAL WARFARE 399 the Acids and Heavy Chemicals Section, and its most important work was in the encouragement of production of the former, the output of the latter always being limited by the scarcity of nitrate of soda. The total sulphuric plant capacity of the country increased from 427,000 tons a month to 501,000 during 1918, through additions to the works of the Du Pont Company, the Hercules Company, the Atlas Company, the General Chemical Company, and of smaller producers, and by Government construction in connection with the War Department's smokeless powder plants at Nitro, West Virginia, and Nashville, Tennessee. At the signing of the armistice, plants were under way with a capacity of 37,650 tons a month. These increases were on top of large increases following the beginning of the war in Europe. Prices for Government consumption were established by agreement late in 1917 at $18, $30, and $35, respectively, for the three different qualities. Following an investigation of production costs by the Federal Trade Commission, the Price-Fixing Com- mittee, in June, 1918, altered these prices to $18, $28, and $32. In September they were again reduced, to $16, $25, and $28. The situation with respect to nitric acid, in view of the limited supply of sodium nitrate, was one of conservation rather than production. Had the war continued, it would have been necessary to curtail the use of nitric acid in the manufacture of celluloid, aniline oil, and other products. Originally, by agreement between the War and Navy Departments and the producers, the Government price was 71^ cents a pound; later, at the instance of the section, the Price-Fixing Committee made the price 8^2 cents a pound. This section had nothing to do with the basic nitric acid problem, the importation of nitrates being under the direct supervision of Mr. MacDowell, and the synthetization plants being a War Department project with which the War Industries Board had little direct contact, although deeply interested in promoting their success and continually spur- ring on these and other governmental munitions projects with all the resources at its command. Caustic soda is another important member of the chemical i 400 INDUSTRIAL AMERICA IN THE WORLD WAR I •• 'i '» kii I t i military forces. Its chief direct use as a fighting chemical was in the manufacture of phenol for picric acid, which was in great demand for explosives by the French and Italian armies. When the Alkali and Chlorine Section was formed in April, 1918, it was discovered that both the War Industries Board and the War Trade Board were correct in their position that there was no surplus production in the United States, and it was demonstrated that there was a grave shortage impending. As there were important indus- trial uses of caustic soda for textiles, and making soap and glycerine and drugs and dyes, it was necessary to reduce exports to South America by one third. Thanks to the cooperative spirit of the industry, there were no difficulties in the matters of price and allocation. Plants were extended and the Government erected two new ones. Extensive curtailments were effected in the con- sumption of caustic soda by the cotton finishers, soap manu- facturers, and lye-makers. The price had early been fixed by agreement at $3.50 for Government account, and remained unchanged. There were five high-cost producers who could not survive at this price, and they were relieved of Government allocations and permitted to sell their product in the open market, where the price was much higher. Only a small proportion of the country's production of soda ash was required for the military programme, directly, but the war brought a great increase of indirect demands, and both production and prices rose greatly — the latter as much as four or five times the pre-war level. By agree- ment with the producers, the Government's needs were met at $1.57 a hundred pounds, as against an outside market price of about a dollar more. No control of this industry was required. Potash, used in the making of black powder, was handled by this section, but has been discussed elsewhere. Chlorine was needed for war purposes in the manufacture of toxic gases, materials for smoke screens, and textile bleaching powder. Besides domestic needs, France had to have three hundred tons a month. By July, 1918, it was discovered that there was a shortage of at least twenty per cent in liquid chlorine. Stringent curtailment orders were EXPLOSIVES AND CHEMICAL WARFARE 401 issued, and in October it was decided to commandeer the industry, but the end of the war intervened. The Govern- ment's requirements of bleaching powder represented half the production, and compulsory orders were issued, at the same time that pulp and textile industries were cut down to one half their ordinary consumption. Whiskey manufacturers addressed themselves to the manufacture of ethyl alcohol, after prohibition had denied them the privilege of supplying it to the human system. The dismantling of their plants was held up and in every other feasible way the production of alcohol was stimulated, as it was needed in very large quantities in the manufacture of smokeless powder, in the refining of T.N.T., for toxic gases, airplane dope, etc. The tiny little fibers of cotton that adhere to the seed as it comes from the gin fight in chemical union with nitric and sulphuric acid in the form of smokeless powder. In them the cotton-fields of the South united with the nitrate- beds of Chile, the coke-ovens of the Appalachians, the pyrites of Spain, and the sulphur of Louisiana and Texas to spread death and destruction. So great was the demand for cotton linters that their use was denied to mattresses, pads, horse collars, celluloid, felts, and the like, and sub- stitution, formerly "the crime of the age," but now become a cardinal virtue, supplied their place. The cotton-seed crushers were conscripted and directed to produce no linters except for the Government, and a pool, of international scope, was created to see that everybody concerned got a fair share of the mighty little things. France, England, Canada, Belgium, Italy, American manu- facturers, and the Ordnance Department, acting for the United States Government, made up the pool. The last undertook the financing and the handling of all aspects of the business except matters relating to allocation, storage, specifications, statistics, and the like, which were handled by the section. The Du Pont American Industries acted as purchasing agent for the Ordnance Department. Five hundred thousand bales of linters were acquired, but even that would not have been enough, plus future production, if the war had continued, and the substitution alternative ( / i :W!.i \ i\ 'M I! 402 INDUSTRIAL AMERICA IN THE WORLD WAR was closely examined, hull fiber and wood pulp being the substitute materials. "We are not interested," said the representatives of the army and navy at the first meeting of the General Munitions Board, when Mr. Summers, in presenting the situation of the country as to explosives, spoke of the importance of T.N.T., and especially of the shortage of toluol needed in its manufacture. Within a few months the army and navy were abstracting toluol from the gas of the kitchen stove and the parlor light jets, thus' adding to low living and the high cost thereof, in order to scrape together enough for the T.N.T. programme. Nothing had been learned from the disastrous attempt of Lord Kitchener to oppose old-fashioned shrapnel to modem high explosives. But Summers knew better, and he and Baruch passed the word along to the Du Fonts to corral all the toluol they could. This was the beginning of an explosives undertaking under the Ordnance Department that involved the erection of fifty-three plants and the expendi- ture of more than $350,000,000 in the next eighteen months. As in other supply matters, the parsimony and blindness of pre-war days enforced wasteful haste. In explosives America was to make up the debt she owed the Allies, and particularly France, in guns. Guns for explosives was the friendly pact made to fit the needs and circumstances of the hour. America was to supply all of her own explosives, at least half of France's, and most of Italy's. The United States contained all of the materials for the making of propellants and exploding charges, except sodium nitrate, and she was nearer to the source of that than the Allies. As the materials weighed eight to twenty times the finished product, economy, as well as the scarcity of ocean transport, dictated that the United States should furnish the powder, just as previously sketched circum- stances indicated that France should supply the guns — in the beginning. Moreover, while the Allies had built up a great explosives industry in this country before our entry into the war, nothing comparable had been accomplished in artillery- making capacity. In the powders we got off from a running EXPLOSIVES AND CHEMICAL WARFARE 403 start; in guns, from a standing start. First and last, it was American-made powder that drove half the projectiles that rained on the Germans from Goritz to Ostend. Let this not be forgotten by those dour critics who tell of the guns and shells and airplanes that did not get to the front. Also be it remembered that reserves have won many a battle with- out firing a shot. As the expansion of the production of explosives was largely one of direct action by the Government, instead of reliance upon private industry, the direction and responsi- bility for the programme were more fully War Department matters than was the case with most commodities. At the same time the industrial effects and relations involved were so complex and so far-reaching that the War Industries Board was compelled to carry a heavy burden of cooperation with the Ordnance people; so great, indeed, that it finally had to create an Explosives Division, headed by Mr. M. F. Chase. The explosives problem was a dual one, the two parts being propellants and bursting charges for shells — the latter being variously designated as high explosives. Before the World War, high explosives had not been as commonly used as fillers for large projectiles. The navies were formerly more interested in high explosives than the armies, but the Germans sprang a dismaying surprise in their liberal use of high-explosive shells in field warfare — so much so that the Allies were lucky to hang on while they were rebuilding their munition programmes to meet like with like. Such high-explosives powder as was in use by the American army and navy was ammonium picrate — which, of course, tended to make the military authorities further indifferent to T.N.T. The three leading high explosives are ammonium nitrate, T.N.T., and picric acid. As has just been said, the Ameri- cans used a modification of the first and last, while the British and Germans favored T.N.T., and the French and Italians picric acid. However, the Allies had discovered that a mixture of ammonium nitrate and T.N.T. made a shell- filler that was both cheaper and more easily procurable than T.N.T., and in October, 1917, this mixture, known as amatol, was adopted by the United States army. The result was ( / I" If r- 404 INDUSTRIAL AMERICA IN THE WORLD WAR ■■i I the creation of a tremendous demand for both ingredients. The Allies had built up through their patronage of private United States plants a T.N.T. capacity of five million pounds a month, but they needed it all and more; and it would have been the height of absurdity to have interfered with their supply in order to promote the munitions programme of the American army. Toluol was the neck of the bottle in T.N.T. production so long as the nitrate supply would hold out, although the ammonia supply, not only for it, but also for ammonium nitrate, was also a subject of deep concern. The production of toluol and ammonia was bound up with the by-product coking industry, which in turn was normally dependent for justified expansion on the patronage of the steel industry. Thus it came about that, because we had neglected our coal- tar by-products, we were weak in the material from which high explosives were made that we needed to export into the German lines with projectiles as carriers. On the other hand, just in proportion as Germany had built up her coal- tar industry, so had she ultimately fortified herself with the materials for high explosives.^ In making it possible for the world to be cheaply gorgeous, Germany had made it possible for herself to be supreme in high explosives. To meet German readiness it was neces- sary for the unready America to rob the city gas plants of their toluol, build numerous by-product coke-ovens solely for war purposes with haste and waste, and expand in every possible way the production of T.N.T. The Du Pont plant at Barksdale, Wisconsin, enlarged its capacity by 2,000,000 pounds a month, and the Hercules plant at Giant, California, by 3,500,000 pounds. Contracts were let for Government plants at Racine, Wisconsin; Giant, California; and at Perry- ville, Maryland, calling for a monthly capacity of 12,000,000 pounds. Although none of these plants was in production when the war ended, the total T.N.T. capacity of the country had then risen to 22,000,000 pounds monthly. As the magnitude of the requirements for propellants and explosives continued to increase, the War Industries Board urged on the War Department the necessity of providing *See Qiapter XXV. EXPLOSIVES AND CHEMICAL WARFARE 405 some substitute for the Chile nitrates. It became evident in the middle of 1917 that the programme would require a consumption of nitrates greater than the entire output of Chile. The only recourse, therefore, was to evolve some system of obtaining the fixed nitrogen from the atmosphere. An experimental plant had been undertaken by the Government in 1916, located at Muscle Shoals, Alabama. After numer- ous conferences with the War Department and after repeated urgings from the War Industries Board, it was decided m December, 1917, to locate a second plant at Muscle Shoals known as plant No. 2, this plant to have a capacity of 110,000 tons of ammonia nitrate per annum. The system adopted was a process which first makes calcium carbide and from this a product called cyanamide. The War Industries Board was in favor of this process, as it involved no experimental feature and as there were a number of plants in Europe and a small plant in operation at Niagara Falls. Furthermore, the process could be ex- tended and furnish products of fundamental importance in the manufacture of the varnish or dope for airplane wings, and also could be used in one of the most deadly gases to be used in toxic gas warfare. The War Department entered into contracts for the con- struction of the plant and had exclusive control of the ex- penditures made. Plant No. 2 at Muscle Shoals represented the first step of the Government to make itself independent of the importation of nitrate of soda from Chile, and marks one of the most important measures for the national defense that has ever been inaugurated. Following the armistice, a great deal of criticism was leveled at this plant, but, owing to the natural advantage of a large water-power capable of economical development, and the possibilities of utilizing the power and the plant for essential materials of war, the eventual outcome should be beyond any question of doubt. Picric acid calls for the nitration of phenol, another coal- tar product. The United States used but little of it, but the French demand built up a great production from numerous plants, which had attained to 135,000,000 pounds annual capacity by the spring of 1918. Nevertheless, the War ! il TJ-? 406 INDUSTRIAL AMERICA IN THE WORLD WAR Industries Board, mindful of our obligations to the Allies, recommended, early in January, 1918, that a $30,000,000 Government picric acid plant be erected. Incidentally, it may be said that the Board at the same time recommended a like plant for the manufacture of T.N.T. Because of the shipping congestion, France and Italy could not import enough phenol, nitric acid, and sulphuric acid to keep their picric acid plants running; so they had to fall back on American production of the finished article. France imder- took to take seventy per cent of the additional production, Italy twenty per cent and the United States was to use ten per cent. Instead of one large plant the Ordnance Depart- ment began three plants: one at Little Rock, Arkansas; one at Grand Rapids, Michigan; and a third at Brunswick, Georgia, At the same time steps were taken for additional production of phenol and the acids and other materials re- quired in making picric acid. The reader may wonder why it is that dynamite does not figure in the list of military high explosives. The reason is that it is so unstable that die shock of the discharge of the gim would burst the shell containing dynamite. That is why, in the Spanish-American War, the United States experi- mented with a pneumatic gim for projecting dynamite- filled projectiles into the Spanish defenses at Santiago. Since that time all the nations have developed more stable high explosives, stable enough to resist the explosion of the propelling discharge, and to require a detonator within the projectile to make it explode at the required moment. The old black-powder shells exploded by means of a burning fuse, but the high-explosives shells "let go" only in response to a priming explosion within themselves. While high explosives were thus in use by France and England, it remained for Germany to introduce them in im- mense quantities and in heavy projectiles in field warfare against troops instead of confining them to naval warfare and the battering of fortifications. While the United States was a large manufacturer of commercial dynamite, required for blasting in mining operations, excavating, tunneling, and other peaceful uses, it was a tyro in the production of military high explosives in 1914. EXPLOSIVES AND CHEMICAL WARFARE 407 High explosives, because of their terrific rapidity of de- tonation, cannot be used as propellants. The powder whose discharge drives the projectile from the gun must be slow- burning in order that its force shall be exerted in expelling the projectile instead of exploding the gun. The United States had led the way in the development of the modem smokeless powder, which it had attained in the form of nitro-cellulose whereby a slow-burning substitute was found for the nitro-glycerine which is the base of dynamite, but it had small capacity for its production. Our great manufacturers of explosives knew so little about it that it was with difficulty that the British Govern- ment induced the Du Fonts to take a contract for nitro- cellulose. The process of manufacture is complicated, in- volving almost every form of industrial chemistry, such as the manufacture of sulphuric and nitric acids, caustic liquor, the bleaching and purification of cotton for nitration, the solution and mixing of guncotton, all of the problems of the paper mill, the manufacture of alcohol and ether, gen- eration and transmission of steam in tremendous units, and many mechanical problems. By the time the United States got into the war, though the then developed capacity for the making of smokeless powder was large, it was far from being large enough, for it Was necessary to leave intact and even augment the sources of supply of the Allies and meet incredibly large require- ments of our own forces. Both the Du Pont Company and the Hercules Company increased their capacities, and two enormous Government-owned plants were undertaken; one, the "Old Hickory" plant, being located at Nashville, Ten- nessee, and the other at the new town of Nitro, near Charleston, West Virginia. Both are to be numbered among the most colossal building achievements in the history of mankind. Yet to-day they are nothing but scrap! The only delay in connection with them was the delay in determining upon them. The contemplated cost of $90,000,000 for a single plant and the possible reluctance to entrust such an enterprise to such an ogre of the trust world as the Du Fonts, as well as the fear of profiteering, caused the Secretary of War to hesitate long. 1 i .it t ■ !1 408 INDUSTRIAL AMERICA IN THE WORLD WAR In accordance with the Franco-American agreement. General Pershing had cabled the War Department on August 23, 1917, that "under pain of incurring disaster" and "to avoid calamity" the United States Government must "furnish all powders and explosives needed for present contracts with the French Government," and "that the United States Gov- ernment furnish by December three hundred tons per day of explosives and two hundred tons per day of powder for French consumption." This was on top of a domestic short- age of smokeless powder for our army alone of about 350,000,000 pounds for 1918 and of 450,000,000 for 1919 — figuring on the then rate of production. Accord- ingly, General Crozier (then Chief of Ordnance) at once drafted an agreement with the Du Fonts for the erection and operation of a Government-owned plant to produce 1,000,000 pounds a day. It was still held up as late as Deceinber 13, 1917, while the War Department considered direct Government construction and operation. The War Industries Board had from the beginning re- peatedly called the attention of both the army and the navy to the grave shortage in smokeless powder capacity. Mr. Summers was placed on a committee with Admiral Fletcher, of the navy, and General Pierce, of the army, and the navy immediately imdertook the extension of their Indian Head plant, which would provide for their requirements, but the army continued to hesitate and delay. Finally, the important contract for a million pounds of powder a day was entered into between the War Depart- ment and the Du Pont Company. The War Industries Board had not been consulted concerning this contract. It protested against this, and insisted that the contract be cancelled, hold- ing that it would be utterly impossible to grant to the Du Pont Company a contract which offered the possibilities of a profit of sixty or seventy millions of dollars at Govern- ment expense. It held that, if the Du Pont Company would not render its assistance in the construction of a Govern- ment-owned plant which should produce powder for the Government without profit, the Government should construct the plant with civilian experts, the War Industries Board maintaining that there were civilian experts who would con- struct a plant independently of the Du Fonts. EXPLOSIVES AND CHEMICAL WARFARE 409 On these representations, the Secretary of War cancelled the Du Pont contract, and Mr. D. C. Jackling, a famous mining engineer, was called to Washington by Mr. Baruch to take charge of the situation. He immediately assembled an organization of civilian talent and undertook the con- struction of the famous Nitro plant, to have a capacity of 625,000 pounds of powder a day. This plant produced its first powder in September, 1918, and was ninety per cent complete at the time of the armistice, having produced 4,533,000 pounds of powder and having been built by former civilian engineers without regular army or navy officers or experts of the Du Pont companies. In other words, within nine months civilian technical talent had constructed one of the largest powder plants of the world, and smokeless powder was successfully produced. This grade of powder was considered one of the most com- plicated and intricate products required in modem war. Mr. Jackling, on the 29th day of January, as director of the United States Government Explosive Plants Units, was able, by reason of the then recognized strength of his organization, to conclude with the Du Pont Company a contract for the erection and operation of a second large plant ("Old Hickory," Nashville) on a basis of compensation that re- moved the undertaking from the category of profit con- tracts. This feat must be credited primarily to the War Industries Board, as it had been the one critic of the policy that nobody but the Du Pont Company could construct a plant that would produce acceptable smokeless powder.^ A large saving to the Government was effected through the construction of one plant by civilian talent and the amendment of the Du Pont contract. Both the Nitro and Nashville plants included the com- plete housing and equipment of a city. Each plant provided ^General Crozier fully reviews his smokeless powder plans and negotiations in his book. Ordnance and the World War (Scribner's), and says on page 249: "The Du Pont Company had such incomparably greater experience than any other agency in America in the construction and operation of plants for the manufacture of smokeless powder, and was so well provided with plans of construction and administrative and technical staff, in a going organization, that I had no hesitation in recommending that the company be empowered to erect and operate a plant for the Government in accordance with the proposi- tion which it submitted.*' it 410 INDUSTRIAL AMERICA IN THE WORLD WAR for all steps in the manufacture, from the making of the acids and other chemicals to the complete smokeless powder. The Nashville plant started its first acid unit in June; the first acid unit of Nitro was started a few days later. The temporary operation of the Nashville plant in making powder was started in July. The Nitro permanent operation was started in August. When the armistice came, the two plants were practically on an equal footing with regard to percentage completed, the Nashville plant having produced 25,620,000 pounds of powder, and the Nitro plant, 4,533,000 pounds. Aside from the non-Government plants of the Du Pont Company and the Hercules Company, the iEtna Company had large contracts. It had been getting its pyro-cotton from the Du Pont plant at Hopewell, Virginia, but that plant s capacity was about to be absorbed by the finishing plants of the Du Pont Company at other places. So it was decided to build a pyro plant to supply the iEtna Company, but the end- ing of the war made this unnecessary. Meantime, the navy had been erecting a plant at the Indian Head proving grounds with a capacity of 400,000 pounds a day. Altogether it was figured that the United States would be producing 1,080,000,000 pounds of smokeless powder in 1919. As it was, when the end came we were actually pro- ducing daily six times as much smokeless powder as was produced in the whole of 1914, and in a few days more the output would have been almost nine times as much. To simplify the supply programme, it was planned that the Ordnance Department would purchase the entire private production of smokeless powder in 1919 and distribute it among the Allies as required. At the beginning of the war, smokeless powder cost about eighty cents a pound and the Allies had paid more than that; at the end it was down to about forty-three cents. The careful reader of this sketch of the production of explosives will gather some idea of the multitude and com- plexity of the industrial problems it thrust upon the War Industries Board. All the war efforts reacted upon each other in a baffling way, but in none so much as in the Indus- EXPLOSIVES AND CHEMICAL WARFARE 411 trial chemistry of war. Every step forward involved numerous consequences, some of them unforeseen, and all of them requiring adjustment. Taken into consideration with the transportation, scientific, and construction problems they involved, it may be said that the production of explosives affected the entire industrial transport and technical organi- zation of the Nation, augmented by auxiliary forces that were called into service from China on the west to France on the east, and from Canada on the north to Chile in the south* I 1 ; . «f it »' ' * t \l « n -II CHAPTER XXIV ARTIFICIAL DYES: THEIR CRITICAL RELATION TO THE WAR — OTHER CHEMICAL AND AUXILIARY MINERALS The wonders of synthetic chemistry — We develop a dye industry — Driving up toluol and phenol production — Sulphide of soda for olive-drab cloth — Acetone for aircraft dope and high explosives — Substitutions and adaptations — A mosaic of brilliant chemical and commercial effort. Because Germany was the master color-maker, she was also dominant in explosives. The chemicals that send colored light waves to the eye swarm with a thousand devils of death. Imprisoned in the coal strata for aeons countless genii of good and evil have been brought forth by the wonders of synthetic chemistry. Released by the dry dis- tillation of coal and harnessed together in innumerable com- binations — two hundred and fifty thousand have already been tried — they serve mankind in dyes innumerable, per- fumes, flavors, gases, synthetic fabrics, therapeutic drugs, power fuels, and the most terrible of explosives. While the rest of the world jogged along in old ruts, Germany's scientists were patiently and industriously explor- ing the vast jimgle of coal-tar derivatives, and her military and industrial lords were assiduously promoting the develop- ment of the industries that at once gave her commercial monopolies and military primacy. By one of the ironies of fate, however, it has come to pass that the brutal assertion of the latter has destroyed the former as well as itself. Germany as a military power is prostrate and the gates of the wonderland of coal-tar products have been forced by her victorious enemies. Driven by desperation to oppose her with her own weapons, they have reversed the process and become independent in industry. In 1914, Germany was manufacturing more than seventy- five per cent of the world's supply of dyes and nearly all of the immediate derivatives of by-product coking, from which dyes and high explosives are made. The United States was producing only ten per cent of its dyes — and ARTIFICIAL DYES 413 even that small fraction was based on the importation from Germany of ninety per cent of the materials. Every pre- tentious attempt to compete with the Germans was blocked by secrecy or competitively overwhelmed. Behind the protec- tion of prices, skyrocketing from the isolation of Germany after 1914 to as much as fifteen hundred per cent, and the concurrent demand without price of the Allies for high ex- plosives and other ultimate products, the American dye industry expanded magically. In its train came the potent derivatives (of such by-products of the distillation of coal as coke, ammonia, gases, and coal tar) benzol, toluol, creosote oil, solvent naphtha, naphthaline, xylol, and carbazole among the primaries or crudes; and aniline oil, phenol, salicylic acid, beta-naphthol and para-nitraniline among the intermedi- ates. Carrying the synthesis farther, by way of illustration, benzol treated with nitric acid gives nitro-benzol from which aniline is produced. In its turn aniline yields, when treated with methyl alcohol, dimethylaniline. Not less than three hundred intermediates are used in making the thousand dyes of commerce. As has already been noted, among the main sources of the explosives that are rooted in the dye industry are phenol for picric acid, toluol for T.N.T., and ammonia for ammonium nitrate. By 1917, the dye industry had developed one hundred and thirty-four intermediates in the United States, and one hundred and eighteen different firms were engaged in the industry with an output of 287,000,000 pounds, valued at $104,000,000. The industry was given insurance in the form of a protective tariff, in 1916, and was assisted by the confiscation of the German patents. Although by its very nature the industry was hobbled at every step by the demands of the manufacturers of explosives for identic materials, it grew to greatness and permanence before the war was over. Between the need of dyes and the still greater need of explosives the section^ of the Chemicals Division of the War Industries Board that was charged with the supervision of the artificial dyes and intermediates had its hands full. Toluol, phenol, acetic acid, wood alcohol, chlorine, caustic soda, nitrate of soda, ammonia, and other ^Artificial Dyes and Intermediates Section, J. F. Schoelkopf, Jr., chief. fP' 1 I ; I I ' . 1 m i I i 414 INDUSTRIAL AMERICA IN THE WORLD WAR materials of dye manufacture were placed under control — and it became the Sisyphian task of the section to keep the industry alive and growing without interfering with the manufacture of explosives. It had its full share of the eternal problem that was before all the sections which were confronted with shortages — of how to attain one end with- out defeating another of equal importance. In 1914, the by-product coke-ovens of the United States were producing only 700,000 pounds of toluol a month; by 1917, this had been driven up to 6,000,000 pounds; to 12,000,000 pounds at the end of 1918, and through con- tracts made by the Ordnance Department would have been increased by 600,000 pounds a month in 1920. Gas strip- ping plants in thirteen cities extracted the toluol from muni- cipal gas at a loss of heat and light to the people. Three contracts were let for the erection of plants for the making of toluol by cracking crude petroleum or its distillates. The three plants of one of these contracts were due alone to pro- duce 3,000,000 pounds monthly. The entire production was commandeered in February, 1918, at $1.50 a gallon. The production of phenol was driven up from 670,000 pounds a month in the spring of 1917 to 13,000,000 pounds in October, 1918. The stimulation of the production of toluol was partly in the hands of the Section of Industrial Gases and Gas Products,^ which was also importantly inter- ested in saccharine, acetylene, and oxygen. The contrivances for curtailment and conservation in the dye industry were numerous. Because of the demand for olive-drab cloth for uniforms, the consumption of sulphide of soda was enormous; and so this kind of cloth for civilian uses was curtailed seventy-five per cent and was to be elimi- nated. Sulphide of soda was to have been entirely denied to the manufacture of black hosiery. Owing to these and similar restrictions and inexperience of the dye-makers, America had some sad experiences with its wearing apparel during the war. The tobacco-chewers were pinched a little by the cur- tailment of saccharine used in sweetening chewing tobacco, so that more toluol might be made. War's demands for *J. M. Morehead, chief. ifJ^ ARTIFICIAL DYES 415 acetylene and oxygen were heavy and both the stimulation of dieir production and its distribution were trying tasks. The Creosote Section^ was confronted with the problem of there not being enough creosote for Government uses, to say nothing of private consumption. There was a minus quantity before priority was served. The army, navy, and the Shipping Board were given the preference and the Railroad Administration took all the rest. Prices were not fixed, but were controlled through the enormous purchases of the Railroad Administration, rising only from seven cents a gallon in 1913 to nine cents in 1918. Production was very greatly, increased during the war. By using substitutes in the treatment of ties and by careful allocation, the situation was saved. Space does not suffice for an account of how the Tanning Materials and Natural Dyes Section^ dealt with the problems of producing, importing, and distributing the raw materials and with that of meeting the increased demand for natural dyes because of the scarcity of synthetic dyes. In paints and pigments^ one of the problems went back to the competition of wheat with flax for growing space. The farmers rushed to the big job of providing bread for the Allies and skimped flax, so that linseed oil for paint- making was short. The Wood Chemicals Section* became one of the most adept in playing the game of substitution. All of the pri- mary derivatives from the distillation of wood — acetate of lime, wood alcohol, and charcoal — were in great de- mand, as were also such secondary products as acetic acid, pure methyl alcohol, acetone, and methyl-ethol-ketone. The dope used by the aircraft production industry demanded all the acetone in the country, and the British needed it for their high explosive, cordite. All wood chemicals were commandeered by the War Department and their distribu- tion turned over to the section. Our old friend, "neck of the bottle," here took the form ^Ira C. Darling, chief. ■E. J. Haley, chief. 'Russell S. Hubbard, first head of this section, died at his post, a sacrifice to his sense of duty. He was succeeded by Levris R. Atwood. *C. H. Conner, chief. :l i'l } < tl i I I 416 INDUSTRIAL AMERICA IN THE WORLD WAR of acetate of lime. Increased production did not amount to much; skimping and substitution had to wm the war here. Seaweed had to deliver acetone; also sour and low-grade com thereby got into the war. Chloroform had to get along with denatured alcohol instead of acetone. Non-war mdus- tries had to do with a fifty per cent supply of acetate ot lime — some of them with twenty-five per cent and others could not have anv acetic acid if it was made from acetate ot lime. Vinegar had to give up its acetic acid to hold the fort, but acetate anhydrin, for the making of aspirin, got priority when the influenza epidemic struck the country in the fall of 1918. ^ . i . r a In the Miscellaneous Chemicals Section it was iound that, while the Food Administration had taken charge ot white arsenic, because insects destroyed food and arsenic destroyed them, the Chemical Warfare Service was callmg for it for the manufacture of toxic gases. The glass indus- try was invited to get along without arsenic and the amount allocated to insecticides was reduced. For the rest, the Anaconda Copper Company was putting up a plant with a capacity of 10,000 tons per annum. , , . r When the Germans put the Turcos to flight with their farst gas attack, the price of bromine' went up 1670 per cent . The normal production of the United States was 600,000 pounds per annum. Stimulated by a price that was never less than two and one half times the normal, it went up to 1,600,000 pounds, with another 750,000-pound increase m sight, and the Government was putting down seventeen deep wells near Midland, Michigan, to get the brines from which bromine is extracted. This section dealt with camphor and metallic magnesium as well as with bromine. Camphor had a war importance of a negative nature. Not used itself to any great extent, its use in the manufacture of celluloid took nitric and sulphuric acids away from explosives. Metallic magnesium has been mentioned elsewhere. Wool grease did not seem to possess any war use possi- bilities until the Germans sprang mustard gas. Then came lanoline as a dressing for gas bums, and almost overnight *A. G. Rosengarten, chief. „ ^Bromine, camphor, and metaUic magnesium were under the Miscellaneous Chemicals Section. ARTIFICIAL DYES 417 wool grease was commandeered to make it, and taken from shoe dubbin to the pharmacopoeia. Germany had a grip on American chemical and metallur- gical industries in ante-bellum times because it was thought diat only the Klingenberg clay of that country was satisfac- tory for making linings of furnaces, crucibles, and other containers that had to withstand intense heats. With no German clay available, the Refractories Section^ developed a satisfactory mixture of a number of American clays. The great smelting and refining activity resulting from the war gave the same section much to do concerning refractory bricks. One outcome of its activity was to inject science into the business and greatly improve the product. The Ceramics administrator had to contend with one of the paradoxes of the war, namely, that in the midst of the terrific struggle the standard of living of the masses ascended in die United States. They wanted more and better china and porcelain. The story is told of a woman of the stockyards section in Chicago who, with her bag stuffed with the swollen war earnings, rejected all the twenty-five and thirty-dollar table sets the clerk showed her. Being a green clerk in this department, he showed her a set which an erroneously placed decimal point priced at $287.50. She chose it the moment the price was named. The demand actually trebled at a time when, on account of the difficulties of importing materials, domestic production was able to expand only seventy-five per cent. It was the duty of the Ceramics administrator to scout for suitable domestic pottery clays, but the manufacturers were inclined to hold aloof from the American clays. Electrodes for electric furnaces were so scarce, as were also abrasives, that it took a section to look after them.^ The manufacture of large quantities of electro-chemical products created a large new demand for electrodes. There were three hundred users of electrodes and only four pro- ducers. After the section got into the saddle, every user of electrodes was adequately supplied. The Greek island of Naxos achieved the war industrial ^Charles Catlett, chief; H. F. Staley, of the Technical and Consulting Staff, cooperated with Mr. Catlett. ^Henry C. Du Bois was chief of the Electrodes and Abrasives Section. \\(i 4 [1 t 1 .( 11 ill! 1 i 1 418 INDUSTRIAL AMERICA IN THE WORLD WAR spotlight as the sole source of high-grade emery for grinding and polishing purposes, especially for optical glass. The French Government controlled the supply, but there was not enough to go around. The upshot was the discovery of an artificial abrasive, manufactured by the Norton Company at Niagara Falls, which would take the place of emery. Other abrasives were also manufactured there. One of the complications was that, in the competition for hydro- electric power generated at Niagara, the abrasives industry was nearly crowded out. The demand for containers for acids was so great that civilians had to get along with a limited number of five- gallon water botdes, to make way for the production of twelve-gallon carboys. The glass industry was put to it to meet the emergency. The same was true of the chemical stoneware industry. Chemical plants arose like mushrooms throughout the country, but by hook and crook the Chemical Glass and Stoneware Section^ met the situation and also provided suflScient glassware for chemical laboratories and medical and metallurgical works. In concluding the chapters relating to chemicals, mention should be made of the Technical and Consulting Staff which Mr. Summers early established to deal with special chemical problems and to look after commodities which had not been assigned to separate sections. The War Industries Board was always seeking able technical men and this is where the professors got their chance. Dr. M. T. Bogert was the first head, resigning to become a Colonel of Gas Warfare. Professor H. R. Moody succeeded him, and many professors of chemistry, including Samuel Tucker, cooperated. The Mellon Institute at Pittsburgh was turned over to the Gov- ernment, without cost, for research work, and its acting director, E. R. Weidlein, was indefatigable in the promo- tion of the work of the Technical and Consulting Staff. The staff devoted much attention to the problems of chemical substitutes and kept an eye out for all obstacles that required chemical engineering. It fathered many of the chemical sections, and was freely and frequently consulted by the section chiefs. ^R. M. Torrence, chief; he was also at the head of the section on asbestos and magnesia. ARTIFICIAL DYES 419 Pursuing an idea suggested by Mr. MacDowell, the Mellon Institute worked on toward the close of the war a substitute for platinum as a catalyzer in the manufacture of sulphuric acid, which would also be available in the makmg of chlorine gas, in great demand for the Chemical Warfare Service. A new catalyzer was developed for the manu- facture of ammonia into nitric acid. The Institute made invaluable contributions to the development and manufac- ture of toxic gases, dealt with the graphite problem, experimented with motor fuels, found a substitute for glycerine (needed for explosives) in chewing tobacco, con- tributed to the mastering of the acetone and acetic acid problems, etc. m i. • i Incidentally, it may be said that not only the Technical Staff, but many of the commodity sections, received invalu- able help from the scientists of the Bureau of Mines and Mr. Van H. Manning, its war-time chief; from the Geological Survey, from the National Research Council, from the Bureau of Standards, from the Geophysical Laboratory, from the technical colleges, and from individual scientists. On the side of industry, when the old chemicals com- mittee and sub-committees of the Council of National Defense were dissolved after rendering notable and pioneer service, the Chemical Alliance (Inc.) was created to deal with the Government as the representatives of the chemical industries. It was an efficient and willing cooperator ably supplemented by the Manufacturing Chemists' Association, the National Fertilizer Association, and other trade asso- ciations. In such men as Summers, commander-in-chief, Mac- Dowell and Chase and their able lieutenants, American industry at its best — learned, experienced, broad of vision, imaginative, creative, initiative, bold in conception, pains- taking in detail, and, above all, dedicated to patriotic service — was at the helm throughout the vast and thousand-sided strategy and administration of the chemical wing of the War Industries Board. \\ k !* » I I » .] CHAPTER XXV THE FORESTS DO THEIR BIT — LIKEWISE THE PITS AND QUARRIES Mobilizing the lumbermen — Edgar meets an emergency — Lumber for the cantonments — Pershing calls for timber; the forests answer — Filling demands unforeseen and gigantic: warehouses, docks, construction in France, wooden ships, aircraft, hospitals — Agreeing on prices — Curtailing news print — Build- ing materials. Lumber and adventure go together. In America lumbering is still entirely dependent upon wild timber growths. To speak of lumber is to conjure up the wilderness — the virgin forests — the freshet floods. The lumberman is the hunts- man of floral life — bold, strong, resourceful. To the pas- sive resistance of the wild life he destroys he opposes the most systematic attacks and the most powerful weapons with which man masters his environment. Something of the whirl- ing energy of his bright saws and something of the stubborn power of his log carriages adheres to his character. Lumber- making is a quick and direct process. Its results are immedi- ate. The rough log of an hour ago is now an imposing pile of a finished commodity. The quickness of production is matched by the alertness of management. Appropriately enough, the first great dramatic resource- mobilization of the war fell to lumber. The lumbermen responded to the call to the colors of production with whoops that blended with the screeching thunder of their saws. They were commanded to produce the chief material of the thirty- two camps and cantonments that were to be conjured up within ninety days. Forthwith the fragrant piles of lumber at a thousand yards and mills were transferred to cars, and, before the surveyors had completed their work at the camp sites, lumber began its march to the new cities of war at the rate of fifty cars a day each; eight hundred cars a day they came, fifty-five thousand strong. Promptness, zeal, and order marked this initial mobiliza- tion, as they did every part of the industrial part of the war ( . THE FORESTS DO THEIR BIT 421 W <( ii (C that was allocated to lumber, first and last. Thanks to the emergency construction and lumber committees of the war industrial management, the emergency bureaus of the indus- try, the Railroads War Board, and the very able Construction Division of the army, the lumber sector was handled syste- matically and without confusion from the start. The indus- try was inherently adaptive to big jobs and violent efforts. The bigger and the more imperative the better. An instance: Late in the afternoon of September 14, 1917, Qiarles Edgar, then of the old lumber committee of the Raw Materials Division, was called to the telephone at his office in the Munsey Building in Washington. "Hello, Edgar! This is Hamilton [major in the Construc- tion Division] . Have you any pep left?" Tes; what 's up?" 'A plenty. It 's closing time and we 've just got orders to increase the size of every cantonment in the country except one; five million feet of lumber for each camp." 'Are your schedules ready?" 'Yes; they are being typed now and will be finished within half an hour. We want to get the orders out to- night." "All right," said Edgar. He immediately called up the emergency bureaus of the Southern pine, Georgia-Florida, North Carolina, and the Pacific coast lumber manufacturers and asked them to hold their office forces and have their respective chiefs meet him at Major Hamilton's office. There the schedules were obtained, considered and allocated to the different groups, which took them to their offices and reallocated them to their various mills. At two o'clock the next morning the job was done, and complete telegraphic orders were lying on the desks of all the hundreds of lumber executives involved when they came to their offices later in the morning. Before night of that day hundreds of cars, piled high with the speci- fied lumber, were rolling to the cantonments. In similar emergencies as much as twenty-five million feet of lumber were loaded and started within three days. On one occasion General Pershing called for four million feet of special-size timbers for docks in France. The vessels li f I f I mi I !l 422 INDUSTRIAL AMERICA IN THE WORLD WAR for their transport to France were to be at three specified ports within a few days, and must not be delayed under any circumstances. Although the timbers had to be cut to order, in some instances from trees still standing in the forest, almost all of the material was delivered at destination before the ships arrived. When the cantonment job was done, the lumbermen thought their great war work was already over. As the anny had not been permitted to plan for the war, it was groping in the dark itself all those first few months. It was traveling along an uncharted path. It never knew what was around the next turn. As it came to pass, the cantonments and camps were little more than a drop in the bucket. Mighty construc- tion jobs developed at every turn. Warehouses, docks, hos- pitals, special service cantonments, ordnance cities. Govern- ment plants, the epic construction in France; the gigantic shipbuilding enterprise, with its lumber-consuming yards and ways and its wooden ships, the cities and towns of the Gov- ernment Housing Bureau, the building of aircraft, the wheeled transport of millions, called for endless quantities of lumber and timber in every form from delicate mill-work to sixty-foot piles and the tremendous sticks for keels and keelsons. There were five hundred and thirty-five army con- struction projects alone, to say nothing of the navy, the Fleet Corporation, and the Housing Corporation. Not an item of these demands was foreseen. Each was an episode. It was one thing after another; unrelated, insistent, imperative! It was a task of colossal proportions; alluring in its uncertainties, charged with all of the stimulus of the novel and the unknown. It was precisely the up-and-down sort of thing — a succession of furious outbursts of energy and sudden stoppages — that was calculated to charge with romance an industry that was reared in it. The pen of genius could write thrilling volumes of literal accounts of the war as it was fought in cypress swamps, in Southern sands, in the shadows of the lofty firs, spruces, and sequoias of the Pacific coast; and, beyond our frontiers, in the hot hardwood forests of the tropics. First and last the Government called for five or six billion feet of lumber, much of it to be cut to original specifications THE FORESTS DO THEIR BIT 423 and demanding exceptional qualities and dimensions. The pine woods of the South were scouted for large trees, and the demand for airplane spruce for ourselves and the Allies tore gaps of devastation in stands of other growths to extricate the prized spruce of the Pacific Northwest. Superb things were done. General Goethals once spoke deprecatingly of the programme of building wooden ships from trees in which the eagles were yet nesting. Yet time and again a tree was moulded into ships within thirty days from its felling. All this great and often heroic endeavor was not untinged with the color of human weakness and errancy. Lumbermen are cast in a rough mould; they are an independent, dom- inating crowd. Government regulations, inspection, price- making, irked them. At first blush many of them regarded the war as a golden opportunity for filling their coffers. Unlike the metal men, they entered the war with no dramatic gestures signifying a high purpose; instead, they sought and almost got away with an excessive price for the cantonment lumber. They took advantage of the ingenuousness of the early trade committee plan of the Coimcil of National Defense. The vastness of the industry and its thousands of units put it beyond the possibility of general commandeering. At the same time it was humiliated and offended because it was not on the War Industries Board's preferred list and thus deprived of any general priority classification. This was because private building was necessarily curtailed; in fact, almost prohibited; and because it was desired to encourage the use of wood as fuel. The lumbermen felt that a great industry was insulted, and insisted that to be off the prefer- ence list was to be branded as non-essential. Of course, nothing of the kind was true. Lumber was one of the great essentials of the war, and for all war purposes it had every preference and priority, but its civilian uses were of a defer- able nature; and so for those purposes it was thrown into a category where it took what was left. Naturally enough, however, it felt aggrieved and was sure that it had been vindictively singled out for sacrifice. The greatest friction between the lumbermen and the Board was with three members of the Southern Pine Association. ir> s \ ! :i 424 INDUSTRIAL AMERICA IN THE WORLD WAR Many a battle was fought between them and Mr. Edgar. The latter was a veteran in the industry and knew it from the woods to the dry-kik. His old associates affected to thmk that he was a sort of trade traitor because he was adamant for fair prices. They made extraordinary efforts to get rid of him. Even Baruch thought at first that Edgar lacked diplomacy. But these men were not subjects for diplomacy. They drove to their ends with the brutal energy of a donkey engine jerking a lurching log through the forest. Baruch found that out later when they sought to batter him down. Then, like Edgar, he tossed diplomacy out of the window, and, figuratively speaking, threw the three obstructionists after it. He refused to have anything to do with any bureau or committee which included them. Whereupon the axemen were retired to obscurity for the rest of the war. Thereafter the lumber sailing of the War Industries Board was smooth. On the other side of the shield is to be inscribed a tribute to the efficiency of the general cooperation of the industry with the Board, typical instances of which have been given. The great lumber sections of the country established and conducted at their own expense highly organized emergency bureaus,^ which maintained efficient offices in Washington, and to all intents and purposes, so far as Government lumber requirements were concerned, were the executive heads of hundreds of mobilized mills. Through these bureaus the individual producers were integrated for carrying out the Government's orders. Schedules of needed lumber were split up between the different bureaus according to their nature and the situation of the member mills with respect to business on hand. Then the bureaus impartially distributed *The emergency bureaus were: Southern Pine Emergency Bureaus ; Georgia- Florida Yellow Pine Emergency Bureau; New England Spruce Emergency Bureau; Douglas Fir Emergency Bureau (later merged in the Fir Production Board) Northern Hardwood Emergency Bureaus; Central Pennsylvania Hem- lock Emergency Bureau; Cypress Emergency Bureau; and, for a time, there was a general hardwood bureau. There were also committees representing Northern pme and the Alabama-Mississippi section. In administering the rulings of the Price-Fixing Committee, it was decided to estabhsh regional lumber administrators. W. J. Sowers was appointed for the territory of the Southern Pine Bureau, and T. J. Aycock for that of the Georgia-Florida region. The Fir Production Board, representing different Government agencies, lookea after the War Industries Board's business in the Pacific Northwest. There was aiso a wholesalers' war service committee. THE FORESTS DO THEIR BIT 425 their schedules among the mills, according to capacity and readiness. All of this was so methodized and energized that it was no unusual thing for a hundred mills to be busy one day with an order that was merely a typewritten list in Wash- ington the day before. The first skirmish between the Government side and the industry was on June 13, 1917, when R. H. Downman, chairman of the Lumber Section of the Raw Materials Committee of the Advisory Commission, met with repre- sentatives of the Southern Pine Association to consider can- tonment lumber requirements. A basic price of $20 event- uated, though a higher one was named until it was discovered that it was actually above the market price. The emergency nature of the order was advanced as the explanation of the attempt to make the Government pay more than the public — but this explanation was brushed aside. The $20-figure represented an average price for the different kinds and qualities of lumber of about $24.85 a thousand. Slight reductions were effected in the fall on three different occa- sions, bringing the average price down to $23.20. Later, as the costs of production advanced, the Federal Trade Com- mission made an investigation and a special committee of the Price-Fixing Commission discussed the subject fully with representatives of the yellow pine manufacturers. About the middle of June, the Government price was raised to approximately $28 a thousand. A demand for a further advance was under consideration when the armistice was signed. The price agreement protected wages, gave the Gov- ernment a standing option on private orders, and provided for the furnishing of information and reports the Board might require. Although the Board agreed to the price of $105 for airplane spruce, fixed in June, 1917, in conference, and of $35 established for wooden ship lumber in May of the same year, it may be said as a general rule that in special requirements, such as airplane spruce, shipbuilding timbers and lumber, hardwoods for ordnance purposes, etc., the respective purchasing agencies handled the situations diem- selves. In December, 1917, the Board, feeling that the comman- deering power was an empty thing as applied to such a J VI I 426 INDUSTRIAL AMERICA IN THE WORLD WAR decentralized industry as lumber — since it was manifestly impossible for the Government to take possession of thou- sands of mills, forests, logging railways, distributing machi- nery, etc. — and that, therefore, public price control would be difficult, recommended that it be clothed with direct statu- tory authority to fix lumber prices. This recommendation does not appear to have been followed up, and eventually the Board undertook to fix maximum prices for softwoods. &)n- trary to early expectations, little difficulty was encountered in this task. The object in view being diametrically opposite to one of the objects in most price-fixings — that is, to dis- courage instead of to stimulate production — these prices were closely trimmed, averaging about $2.75 above the Government price. Production beyond minimum requirements was further checked by the activities of the Non-War Construction Section of the Priorities Division. Manufacturers and distributors of lumber, like all producers of building materials, were required to sign a pledge to deliver lumber only for essential purposes or on express, written permits. Conservation restricted the use of hardwoods, which were scarce, and in some lines softwoods. Generally speaking, though, lumber conservation was incidental to the conservation of other materials and of transportation. Its use was restricted, not because it was scarce, but in order to reduce production, with its savings of men, machinery, materials, and transportation. While lumber manufacturers were not on Preference List No. 1 of the Priorities Division, designed primarily as a guide in the allocation of fuel, many industries consuming lumber were on it, and on list No. 2, the wood-consuming industries were given priority groupings. All Government requirements, however, carried with them the necessary pri- ority privileges. Just before the end of the war, the Priori- ties Commissioner issued a circular closely defining the restrictions under which the lumber industry would be expected to operate. R. H. Downman, then president of the National Lumber Manufacturers' Association, was chairman of the original council committee. Later, with the coming of the plan of disassociating all cooperative committees from the War THE FORESTS DO THEIR BIT 427 Industries Board, Mr. Downman became chief of the Build- ing Materials Division. Owing to illness he was compelled to resign. A lumber division was then established with Mr. Charles Edgar, a retired lumberman, with extensive experi- ence in Wisconsin, Minnesota, Arkansas, and elsewhere, as chief. Among Mr. Downman's more active assistants, aside from Mr. Edgar, who was early on the job, were E. T. Allen, Charles H. Worcester, and Frank G. Wisner. To Mr. Allen belongs much of the credit for the comprehensive handling of the spruce production problem which finally became the exclusive province of the Aircraft Production Bureau of the Signal Corps and Air Division. Major A. M. Cooke, of Nor- folk, Virginia, was Mr. Edgar's first assistant, and his stafiF included Captain E. A. Self ridge, Jr., Willitts, California; M. E. Philbrick, Memphis, Tennessee; W. E. Chamberlain, East Cambridge, Massachusetts; F. H. Ransome, Portland, Oregon; H. W. Aldrich, Mill City, Oregon; C. Y. Winton, Minneapolis, Minnesota. The Fir Production Board was composed of J. H. Bloedel, General Brice P. Disque, and H. B. Van Duzer. The Lumber Division had to deal with one of those gangs of bloodsuckers who are always on hand in war-time to dis- grace humanity when others are honoring it. A number of unscrupulous jobbers of the curbstone variety conceived the idea of having lumber surreptitiously consigned to construc- tion officers in care of themselves. Such shipments gained transportation priority and got lumber into the possession of the crooks when other dealers were without it. They would then go to the construction officers, who were always short of lumber because of transportation congestion, and extort a price of eight to twelve dollar's a thousand above the fixed Government price to producers. The scheme came to light when the producers began to inquire why it was that there was one price for orders coming to them for Government account through the bureaus and a higher price for orders from these jobbers. Every car that got through on this fraudulent billing — and there were hundreds of them — took the place of a regular Government car and made the dealers a profit of from $150 to $250 a car. Mr. Edgar 1 I 'I ■ it ll ^ 'I .! J 428 INDUSTRIAL AMERICA IN THE WORLD WAR discovered one of these deals in time to stop payment after $75,000 had been paid on account. The manipulator of this particular deal had the nerve to invoke "influence" to bring pressure to bear on Mr. Baruch to intervene, but was shown the door. Nevertheless, the Court of Claims eventually allowed the jobber the whole of his claim at Newark market prices; despite the fact that eight of the same kidney, caught in the meshes of the Department of Justice, had to disgorge $35,000 apiece. TTie problem of getting lumber for Government purposes was one of transportation instead of production. At one time there were seventeen thousand loaded lumber cars jammed up south of Richmond, Virginia. Closely associated with the lumber administration, though in another general division of the Board, that of Finished Products, was the Wood Products Section which was estab- lished in October, 1917, chiefly to help the army obtain hardwoods for its various vehicles with wooden wheels. There was found to be a real shortage of dry hardwoods, and arrangements were made for the Government to assist in providing adequate dry-kiln facilities. Later, the chief work of the section was to plan the allocation of Government requirements among the twelve thousand woodworking estab- lishments in such a manner that they might continue to exist, as the capacity greatly exceeded war requirements. No real shortages of finished goods existed at any time. Black wal- nut was so scarce that it was necessary to inaugurate a cam- paign of education to increase production, which had an element of the picturesque with its squads of Boy Scouts scouring the forests and woodlots for walnut trees. One of the knottiest problems that came before the War Industries Board was that of pulp and paper, particularly newsprint. As this industry drew on materials that were needed in mimitions, and was a heavy consumer of coal, labor, and transportation, it was early marked for drastic curtailment; while the mounting prices of paper called for price-fixing. The situation became so desperate that the Board had decided to control and allocate all newsprint after November 15, 1918. The Pulp and Paper Section was cre- ated June 6, 1918. W. B. Colver was the first chief. He . < THE FORESTS DO THEIR BIT 429 was succeeded by Thomas E. Donnelley, and on October 1, 1918, the section was made into a division.^ The first work of the division was to take up with commit- tees of the industries the subject of the elimination of waste- ful practices and the reduction of the quantities of chemicals consumed. On pledges of such economies the industry as a whole was put on the preference list. Class IV, for coal and transportation. The biggest job that fell to the division was the working out of a series of regulations for thirty-six industries con- suming large quantities of paper. The publishers, who had enthusiastically backed the conservation programme for others, found it a horse of another color when it came to be applied to the size and number of their publications. Daily and weekly newspapers were cut down fifteen per cent; Sunday newspapers, twenty per cent; periodicals and general job-printing, twenty-five per cent. Each of the paper con- suming industries initiated its own curtailment programme, through its war service committee. Its suggestions were reviewed by the division, and then, after further consultation, regulations were drafted and issued. In dealing with the publishers many complex questions arose, which were of a highly technical nature, and not susceptible of interesting presentation in a book for the general reader. While the division did not attempt price control, the price of newsprint was finally fixed through congressional initia- tive. The price of this commodity had become so high before the United States entered the war and publishers were suffer- ing so severely that Congress directed the Federal Trade Commission to make an investigation of costs and prices. On June 30, 1917, the Commission reported that $3.10 a hun- dredweight was a fair price. After many appeals and hear- ings, this was established as the base price, April 1, 1918. In the fall of 1918, the United States Circuit Court for the Southern District of New York, acting as arbiter, fixed the price at $3.50; later still, the Federal Trade Commission advanced the base price to $3.7525. ^The division was divided into a Manufacturing Section, S. L. Willson, chief; Paper Economies Section, Isaac W. Blanchard, chief; Newspaper Sec- tion, G. J. Palmer, chief; Fiber Board and Container Section, Harold W. Nichols, chief. I 'I « 4 I hill Hfi '^1 ' 430 INDUSTRIAL AMERICA IN THE WORLD WAR The Building Materials Division, with Richard L. Hum- phrey as director, was established in March, 1918, though the supervision of the industry had begun with cement as early as April, 1917, Eugene Meyer, Jr., then looking after it, as well as the non-ferrous metals. Lumber and steel were controlled otherwise, as we have seen. Sand, gravel, and crushed stone soon followed cement under the old committee organization. The division devoted itself principally to Portland cement, brick, hollow tile, gypsum, plaster board, and wall board. These materials, if not abundant, were generally in sufficient quantity; though, owing to transportation congestion and local conditions, there were often sectional shortages. The single general exception was gypsum and plaster board, of which Government requirements were twice as great as normal production capacity. Consequently the Government had to take over the industry, allocate orders and fix prices. In general, the chief work of the division was to promote curtailment of production in order to make way for the emergently essential industries and to assist the various pro- curement and construction agencies of the Government in meeting their requirements. The general method of pro- cedure was the same as with lumber. Prices were fixed on cement and brick for Government use, and the industries voluntarily kept the public prices near the Government prices; while, under the Non-War Construction Division of the Priorities Division, non-governmental uses were cut to the bone, virtually all building and road-making, except for war-promotion purposes and exceptional instances, being stopped as has elsewhere been related. Local conditions in the congested northeastern district became such in the spring of 1918 that it was necessary to fix prices and allocate orders for sand, gravel, and crushed stone in the New York, Baltimore, Washington, and Norfolk districts. There were then in course of erection, between Washington and New York, alone, not less than fifty-four big Government projects. The work of this division was so broad, covering in detail as it did forty-three important industries with thirty-eight war service committees, that a mere sketch of its activities o < o n w M H CC P H < H ce fi I— o m m < e INTENTIONAL SECOND EXPOSURE #< I I \ I 1 J 430 INDUSTRIAL AMERICA IN THE WORLD WAR The Building Materials Division, with Richard L. Hum- phrey as director, was established in March, 1918, though the supervision of the industry had begun with cement as early as April, 1917, Eugene Meyer, Jr., then looking after it, as well as the non-ferrous metals. Lumber and steel were controlled otherwise, as we have seen. Sand, gravel, and crushed stone soon followed cement under the old committee organization. The division devoted itself principally to Portland cement, brick, hollow tile, gypsum, plaster board, and wall board. These materials, if not abundant, were generally in sufficient quantity; though, owing to transportation congestion and local conditions, there were often sectional shortages. The single general exception was gypsum and plaster board, of which Government requirements were twice as great as normal production capacity. Consequently the Government had to take over the industry, allocate orders and fix prices. In general, the chief work of the division was to promote curtailment of production in order to make way for the emergently essential industries and to assist the various pro- curement and construction agencies of the Government in meeting their requirements. The general method of pro- cedure was the same as with lumber. Prices were fixed on cement and brick for Government use, and the industries voluntarily kept the public prices near the Government prices; while, under the Non-War Construction Division of the Priorities Division, non-governmental uses were cut to tlie bone, virtually all building and road-making, except for war-promotion purposes and exceptional instances, being stopped as has elsewhere been related. Local conditions in the congested northeastern district became such in the spring of 1918 that it was necessary to fix prices and allocate orders for sand, gravel, and crushed stone in the New York, Baltimore, Washington, and Norfolk districts. There were then in course of erection, between Washington and New York, alone, not less than fifty-four big Government projects. The work of this division was so broad, covering in detail as it did forty-three important industries with thirty-eight war service committees, that a mere sketch of its activities ' I ft < o m (— ( K E- a: ^ , P < 02 H < H Q [^ H o ^ I— I Q 03 W a S S 4 If \ I "II Hii THE FORESTS DO THEIR BIT 431 would fill a sizable volume, and anything less would be but a dull generalization. It employed a staff of fifty-five persons besides making use of the clerical staffs of the governmental agencies with which it cooperated. One of its outstanding achievements, outside the usual run of price negotiations, priority administration, allocation, etc., was the standardization of schedules for war building projects. This was accomplished in carpentry, millwork, composition roof- ing, slate roofing, clay tile roofing, gypsum wall and plaster board, fiber wall board, finishing hardware, door-hangers and track, plumbing and gas fitting, heating, electric wiring and light fixtures, painting, hollow building tile, magnesite stucco, fire prevention and protection devices. The history of the building materials industries — aggre- gating the second or third largest trade interest in the United States — in the war period is one of startling contrasts. On one side there was the misery of curtailment and restriction, an enforced decline in activity and prosperity in the midst of a general boom and great prosperity. On the other side were the tremendous outbursts of productive energy to meet occasional emergencies and urgent demands for certain commodities. I \ CHAPTER XXVI LEATHER AND RUBBER GO TO WAR A million sets of harness — Fifty million pairs of shoes — Regulating the shoe trade — What might have happened — Rubber an economic freak. Man's ancient ally in war, the horse, came back from his eclipse by motor vehicles to take his part in the black drama of the greatest of wars. His recrudescence revived a decadent industry — that of harness and saddlery — and by demand- ing a million sets of harness contributed to the violent strains to which American industry was subjected during the war. Despite motor transport, the fighting men wore out shoes in prodigious quantities, and there were other great demands for leather. So huge was the total of all military demands that the civilian was doomed to get along with about a quarter of the normal leather product of the country. Indeed, there is evidence^ that if procurement officers had not rebelled at the mountainous size of the leather require- ments passed on to them, the satisfaction of army orders would have taken all the hides in the United States and three hundred thousand more. Men who had figured requirements for troops, batteries, and companies in peace-time were afloat on an uncharted sea when it came to calculating the leather needs of an army of five million to seven million men that had to be projected at least six to eighteen months ahead because of the time that elapses from the taking of a hide until it can become the finished product. It takes as long to build a shoe, from the animal's back to the finished product, as it does to build a ship from ore to commission. The American leather and leather-consuming industry is a Colossus in the age of industrial colossi and was well prepared for the war orders that came to it in bales, often with very little anticipation. The United States makes more leather than all Europe and consumes in proportion. The ^Testimony of Colonel George B. Goetz before House of Representatives Select Committee on Expenditures in the War Department, page 1403, vol. Ii, of the Ordnance Sub-committee bearings. \ 'i LEATHER AND RUBBER GO TO WAR 433 war-time weakness of the industry is that it has outgrown the domestic sources of hides. A third of the cowhides and kips, three fourths of the calfskins, eighty-eight per cent of the horsehides, and sixty-seven per cent of the sheepskins tanned in the United States are imported. With the re- striction of shipping space, importations were greatly reduced and, at the same time, such extraordinary demands as 50,000,000 pairs of shoes, 1,000,000 sets of harness, about 3,500,000 leather jerkins, and more than 7,000,000 pairs of heavy gloves had to be provided for our army alone. As an offset to the limitations of imports was the fortu- nate fact — though at the time it seemed most unfortunate —-that, owing to the restrictions imposed by the United Kingdom in the spring of 1917 on importations of leather, there was a large supply on hand, accumulated in anticipa- tion of continuing exports. Moreover, there had been an extraordinary increase in the domestic production of hides, owing to the demands of the Allies and of neutral nations for meats and the consequent stimulation of the live-stock business. Consequently there was no great disturbance in the industry occasioned by the entrance of the United States into the war. In the first months after that event, a Leather and Shoe Committee and a Leather Equipment Committee of Mr. Rosenwald's division of the work of the Advisory Commission of the Council of National Defense handled the army's leather needs; which were slow in developing, outside of shoes. Of the latter it was the means of providing some eighteen or twenty millions of pairs. But when the War Trade Board took charge of imports, when shipping space was drastically restricted, and the Government began to come into the market for incalculable but vast quantities of leather products, the situation completely changed, and it was seen that comprehensive control of the industry from ultimate sources of materials to distribution of products must be imdertaken. This comprehensive control had not been fully worked out when the war came to its end, but it had evolved a unique relationship between the army and the War Industries Board, which amounted to a blending of the two in regard to the !■ k t \ I ii 434 INDUSTRIAL AMERICA IN THE WORLD WAR handling of leather. The fusion came about in this way: In the first part of February the Quartermaster Corps decided to coordinate army contracts with the leather industry for the purpose of insuring adequate supplies and proper quali- ties for its own uses and also to protect the civilian population from unrestrained consequences of its enormous demands. Mr. C. F. C. Stout (of John R. Evans & Company, Phila- delphia), who had submitted a report on the leather situation, was then made chairman of what was called the Hide and Leather Control Board of the Supply and Equipment Divi- sion of the Quartermaster Corps. Later it was made a branch of the Hide, Leather, and Leather Goods Division. When the War Industries Board was reorganized in March, 1918, Mr. Baruch made Mr. Stout chief of the Hide, Leather, and Tanning Materials Section of the Board. (The tanning materials part of the work was transferred later to the Chemicals Division.) Mr. Stout was thus in and of the War Department and the War Industries Board, but his stafif was in the former. In the following October, the staflF was transferred to the War Industries Board, with the exception of the field nien. It had nine sections or bureaus as follows: Foreign Hides and Skins, 0. C. Howe, chief; Domestic Hides and Skins, Lewis B. Jackson, chief, Arthur L. Webster and Arthur T. Coding, assistants; Sole and Beking Leather, H. W. Boyd, chief, succeeded by W. B. Eisendrath; Harness, Bag, and Strap Leather, F. A. Vogel, chief; Sheepskin and Glove Leather, E. C. Shotwell, chief; Boots and Shoes, C. D. P. Hamilton, chief; Harness and Personal Equipment, C. A. Rogers, chief; Behing, G. B. Rowbotham, chief; and Gloves and Leather Clothing, H. J. Lewis, chief. Sheepskins for leather jerkins were first of the leather commodities to be put under control. On March 20, 1918, the packers and wool-pullers met in Washington and agreed to give the tanners of jerkin leather an option on all picked sheepskins at a maximum price of fourteen cents a square foot; and the tanners agreed to dress the skins at four cents a square foot. This agreement was equivalent to the taking over by the army of all such pelts. It ran until June 7, 1918, I r LEATHER AND RUBBER GO TO WAR 435 and made no provision for prices to the public. When the agreement expired, the Price-Fixing Committee issued a schedule of maximum prices for sheepskins, varying from eight to eighteen cents according to quality. With slight changes in October, these prices prevailed until after the war. In April, the Price-Fixing Committee established max- imum prices for cattle hides and made several revisions thereof in the interval before the end of the war. The neces- sity for allocating stocks did not arise, but, in conjunction with the War Trade Board, importations were allocated. The maximum-price plan for hides and skins was far from being satisfactory, and if the division had the job to do over again it would probably insist on licensing every dealer to do business within the maximum prices under penalty of losing his license in case of overstepping the limit. It was also felt that prices were changed too frequently. It would be wearisome to undertake to trace the operations of all the sections. An interesting feature of the general work was the development of the heavy "Pershing" and later the "Victory" shoe for the soldiers in the trenches, it having been found that the American army shoe was not heavy enough for that kind of use. The first step toward entire control of the industry was taken on June 29, 1918, when the Conservation Division issued a set of regulations for the reduction in the number of styles, colors, and lasts of shoes and eliminating certain wasteful fashions altogether. Each manufacturer pledged himself to obey these regulations and thereby got himself placed on the preference list for fuel and transportation. This pledge system was substantially the same as was applied by the Priorities Division throughout industry. The soaring prices of shoes, as well as the scarcity of leather for military purposes, inevitably indicated that the War Industries Board must get down to a detailed price and model regulation in the shoe business that was hardly known in any other part of its field. With that singular perversity of human nature, which makes it delight to revel wantonly in the scarce and expensive when necessity's demands are most pressing, women's fashions called for a different color of glazed kid shoes for each gown; and the shortening of .. • I 436 INDUSTRIAL AMERICA IN THE WORLD WAR skirts was followed by the heightening of shoes — just when the price of glazed kid was three hundred and fifty per cent above normal and there was a menace of a general shortage of leather. At first it was proposed that there be but a single type of black leather shoe, and that the wholesale price should be stamped on the sole of every shoe to provide a check on the cupidity of retailers. This last suggestion was stubbornly opposed by the trade. After a long series of conferences, some of a very warm nature, the boot and shoe manufac- turers finally yielded to a programme, applicable June 1, 1919, which confined shoes to black, white, and one shade of tan, in color. Heights were fixed, the introduction of new lasts was forbidden, and certain wasteful styles were dis- carded. As to quality there were to be four grades. Class A was to retail at $9 to $12 for high shoes and $9 to $11 for low shoes; Class B, at $6 to $8.95; Class C, $3 to $5.95; Class D, below $3. To get around the objection to having the wholesale price stamped on the shoe, it was directed that each shoe was to be stamped with a key number, so that the purchaser could assure himself that he was getting a shoe in the represented price grade. Retailers were to be required to display placards, explaining the price scheme, and pledges of compliance with the regulations were required all along the line. The conservation programme would not only have saved the consuming public millions of dollars, but would have relieved the trade from the burden of $100,000,000 worth of stocks needed to meet the great number of styles and models in ordinary demands. While leather shod the doughboys on the road to victory, rubber shod their transport. There was no lack of either for the Allies, and their enemies were pinched for both. Paper shoes and metal tires for Teutonic locomotion were signs of the downfall of the empires of the Hapsburgs and the HohenzoUems. Rubber was one of the economic freaks of the war in that its price was in no wise affected by the political and com- mercial reactions which upset pretty much everything else. It was unaffected by the beginning of the war in Europe and it never revealed a tremor after the United States entered LEATHER AND RUBBER GO TO WAR 437 the international lists. It was even so conservative that it refused to ascend to the maximum prices prescribed by the War Trade Board. Yet the United States produces no crude rubber and is entirely dependent on imports, most of which come over long ocean routes — from Brazil and the East Indies. While we were having convulsions in the control of some commodities of which we were the chief if not sole pro- ducers, we had an easy job with the one bulky commodity, outside of nitrates, which we did not and could not produce at home. Moreover, though the United States is not a pro- ducer, it is by far the greatest consumer of rubber and manu- facturer of rubber products. The basic explanation of the anomalous calmness of rubber in a world of economic stress and storm was somewhat paradoxical; prices were not shoved up by the foreign producers because we took so much of their product that diey dared not risk a move that might reduce consumption. To put it in another way, production from rubber plantations had increased so rapidly that, when the war forced Germany and Russia out of the market, the producers were so much concerned for outlets that they were in no mood to apply the screws. The only necessity for any regulation of rubber arose from the lack of ships for its importation and from the desirableness of the conservation of men and materials in every phase of the war effort. The lack of transport caused the War Trade Board to put a limit on the amount of rubber that might be imported — a limit which necessitated economy; but at the same time it fixed prices, compliance with which was the only means of getting licenses to import. But stolid rubber did not rise to these prices. As the War Trade Board did not act in this matter until May, 1918, and ample cargoes of rubber had been crossing the Pacific prior to that time, there had been no occasion for the War Industries Board to act. Thereafter, control became neces- sary and the Rubber Section (placed administratively in the Textile Division) was established in August, with H. T. Dunn as chief .^ U. W. Rowland and J. C. Matlack were assistants, and George E. C. Kelley, auditor. I 4 l>' i i 1 :hm I*'. Ti I' I 438 INDUSTRIAL AMERICA IN THE WORLD WAR All importations were cut down about one third, and, as war uses demanded thirty thousand of the admitted one hundred thousand tons for 1918, considerable adjustments were necessary. The restriction of the automobile industry was an important factor, as seventy per cent of the rubber imported into the United States goes into tires and tubes. The number of types of tires was reduced. Then, on September 21, 1918, the Priorities Commissioner issued Circular No. 24, which put rubber among the controlled industries in the customary way. The circular recom- mended that models, sizes, and styles be cut down in all lines of rubber goods, and limited the production of tires and tubes for the last three months of 1918 to three fifths of fifty per cent of the normal output for eighteen months. The rubber trade was so much impressed by the helpless dependence of the United States on foreign sources for its crude rubber — though no unpleasant consequences arose during the war — that its war service committee ventured to make a suggestion to the American delegates to the Peace Conference. It was feared that Holland and the British Empire might be tempted to use their near monopoly of the raw material to build up a monopoly of manufacturing. Consequently the committee recommended that the American delegates should insist on guaranties from the British and Dutch Governments that American manufacturers should have access to the raw material "upon as favorable terms as the manufacturers of any country.'* CHAPTER XXVn WAGING WAR WITH TEXTILES Blotting out Civil War scandals — The early Rosenwald Committee — Clothing the fighting millions — The final stupendous requirements — The reign of wool — The story of "shoddy" — Mobilizing the cotton goods — Eight hundred million yards for the army — The industry falls into step — Gingham-makers produce uniforms — Cromwell cracks the whip. The Civil War put a brand of shame on the American textile industry. Old soldiers still tell of the rotten fabrics of their uniforms — and the army clothing contractor of the internecine struggle was for fifty years the type par excellence of the home-staying leech who fattened on the profits of fraud while the soldiers bore the brunt of the Nation's travail. The brand was not erased by the lapse of sixty years when the World War once again called upon the textile trade to clothe the fighting millions of America. Here was the opportunity to cover the old shame with a new honor. It was fully availed of, and availed of under inevitable circumstances that made the industry the guardian or the defiler of its own escutcheon. It was humanly impossible for the Quartermaster Corps, or the organization of the army that subsequently assumed the quartermaster function, to deal with the stupendous tasks of providing clothing for the mounting millions of the Republic's armies without mustering into its service the captains of the industry. Equally impossible was it for, first, the Council of National Defense, or, later, the War Industries Board to discharge their cooperative functions without endowing with regulatory powers the very men who were to be regulated. None but great textile manufacturers and dealers could apply business acumen to the expenditure of something like two billions of dollars for the clothing, tentage, and miscellaneous textile equipment of the armies. Only they could marshal the columns of mills, only they could determine fair prices. Put on their honor, these men in various capacities rose above personal considerations, \ 440 INDUSTRIAL AMERICA IN THE WORLD WAR above trade friendships and group loyalties, forgot personal gain, and served unswervingly the interests of the Govern- ment and Nation. Taken from the sellers and producers and placed on the side of the buyer and consumer, they never doubted for a moment what their duty was or hesitated for an instant in following its commands. That is really the big thing of the war in the textiles — not the millions of garments produced or the billions of yards of cloth woven. It was the big thing of the war in almost every line of supply — the incorruptibility of the American business man commandeered for Government service. It is a record of moral integrity developed by the war that may well be placed in the balance against the demoralization of character that seems to have been one of the foul legacies of the war. Notwithstanding all the slander to the contrary, the great task of meeting the first supply emergency in the chaotic days of the spring and summer of 1917 was met just as honorably, ably, and faithfully by the volunteer committees of the industry, attached to the Government only by the mere name of an Advisory Commission Committee, as it was later by some of the men of these same committees when they were divorced by formal direction from their old trade associ- ations and were commanded henceforth to be the servitors of the Government. Had they not been of good stuff in the first instance, they would not have been in the last. The major part of the War Industries Board, whether in functional or conmiodity capacities, had its roots in the old Committee of Raw Materials of the Council of National Defense organization; but the textiles, like leather, go back to the Committee on Supplies, of which Julius Rosenwald, of the Advisory Commission, was chairman. In a general way of speaking it may be said that the Finished Products administrative division of the War Industries Board was the heir of the Supplies Committee, though it dealt also with matters that were never within the province of the committee. Mr. Rosenwald's chief of staflF was Charles Eisenman, a retired textiles manufacturer; and to his assistance in the work of advising the Government regarding its textile pur- chases he summoned a sub-committee of manufacturers of WAGING WAR WITH TEXTILES 441 / woolens, another of cotton goods, and a third of knit goods. These committees, acting with purely trade committees, con- stituted for nearly a year the fabric of governmental relations with the respective industries. The storm of public protest against the so-called buyers- and-sellers committees centered chiefly on these three com- mittees, and during the drifting period in the development of the War Industries Board their staffs and to some extent their executive personnel were taken into the reorganized army supply department, which for a time virtually essayed to fill the whole field of contact between the War Department and the textiles as well as in other finished goods, leaving to the Finished Products Division of the Board little but the name. Some of the men remained there till the end of the war, while others returned to the War Industries Board when it gained vigor and authority with the appointment of Mr. Baruch as chairman. Incidentally, it may be said, that to such an extreme degree for a time, and to such a large degree all the time, did the Clothing and Equipage Division of what became the Office of the Director of Purchase and Storage of the Division of Purchase, Storage, and Traffic, headed by Major- General Goethals, function in what was properly the zone of the War Industries Board, that it is very difficult to write with precision of the credit and responsibility for much of what was accomplished in the textiles sector. In any event, great credit goes to the Supplies Committee and its subsidiaries. Mr. Eisenman passed off the scene about the end of 1917, but, in an uncharted field, harassed by unjust attacks, and not always properly supported from above, he had laid the foundations of a firm structure of cooperation between the Government and the textile indus- tries. Through his committees were handled 45,000 con- tracts aggregating $800,000,000 at an administrative expense of only $20,000. His honesty, courage, and fidelity to the Government were beyond question. The various textile sections were finally grouped into a Textiles Division with John W. Scott as director, having as his assistant Henry B. Ashton. Spencer Turner, who had been acting chairman of the old cooperative Committee on i V :^ I 'I i M 442 INDUSTRIAL AMERICA IN THE WORLD WAR Cotton Goods, then became chairman of the Cotton Goods Section, having as his assistants Grosvenor Ely, George F. Smith, Burton Etherington, and Ralph E. Loper; Lincoln Cromwell, who was chairman of the old Committee on Knit Goods, became chairman of the Section on Knit Goods, his associates being Rufus W. Scott, F. E. Haight, and John McCauley; and Herbert E. Peabody, who, as the active member of a committee of the American Association of Woolen and Worsted Manufacturers, had been the liaison man between that committee and the Rosenwald Committee on Woolen Manufactures, became chief of the Woolens Section,' assisted by A. L. Gifford. With this much of an organization background, the story of achievement may now be told, in its high lights, without regard to nice distinctions of personal or group credit or responsibility. Aside from the rush of equipping the first troops called to the colors, the woolen goods manufacturers never had any difl&culty in meeting the Government's demands throughout the war, so far as dieir productive capacity was concerned. The real woolen problem was that of the supply of the raw material — wool. The first troops got some queer and miscellaneous supplies, chiefly in blankets, picked up here and there and made up from heterogeneous goods that happened to be on hand. After that there was never any real difficulty in meeting the growing demands of the army; of blankets, 19,400,000 pairs were produced; of woolen coats, 12,365,000; of woolen trousers and breeches, 17,342,000; of flannel shirts, 28,869,000; of overcoats, 7,748,000; of woolen stockings, 90,000,000; and much else besides. , The nominal requirements of the army were so great ttiat the needs of civilians were virtually ignored. If there happened to be any wool left at any time, the civilians got *The other sections were: ... r««,„« tit Cotton and Cotton Linters Section. George R. James, chief; George W. Naumburg, assistant; Sherburne Prescptt, assistant. Felt Section. Sylvan Stroock, cWef. Flax Products Section. George F. Smith, chief. Rubber and Rubber Goods Section. H. T. Dunn, chief. Silk Section. William Skinner, chief. M^ir^n-, Domestic Wool Section. Lewis Penwell. chief; William D. McKellar. assistant. » ,, o u- * Foreign Wool Section. A. M. Patterson, chief. WAGING WAR WITH TEXTILES 443 It. Toward the end of the war the army turned in require- ments based on the immediate supply of 7,000,000 men. There was not one third enough wool to meet such a pro- gramme. Mr. Peabody was aghast. It is certain that if the army had insisted on its schedules as they stood for urgent delivery — assuming that the war had gone on — there would have been no woolen clothing for civilians in 1919 and thereafter that had not been already manu- factured. Facing such a possibility, the wool section men were very philosophical, though they dreaded the storm of com- plaint that would come. They knew that, as a matter of hard fact, the civilian population could get along with old clothes for a year without any great hardship. In the spring of 1918 only forty-five per cent of the woolen mills were on Government work, and the others were unable to get new stocks of wool, as the Government had it all. The chief problem before the wool section was what was to be done in the future with these mills and with the supplying of civilians. Plans were under way for the conversion of some of the mills to other war work, and an exhaustive survey was made, through questionnaires and by other inquiries, to ascertain just what were the private stocks of wool and the amounts of manufactured fabrics and clothing. Some of the conservation steps taken through the Conserva- tion Division, as well as the Industrial Adjustment Com- mittee, have been noted in the chapter on the Conservation Division. But, at best, the prospect was that the people would have to go on an old-clothes basis with a golden era for the second-hand clothing men and a period of vacuity for clothing stores. With its control and monopoly use of wool stocks and, therefore, its control of the whole woolen textile business, the War Department virtually annexed the business of fabricating the wool, for its only use was for military clothing and other military uses. The clothing-makers were little more than its manufacturing department, for they were chiefly making what the War Department wanted and making it according to army designs and specifications. If, in this latter period, the army paid too much for its clothing (and n { I > It 444 INDUSTRIAL AMERICA IN THE WORLD WAR there is no evidence that it did), there is but one place for the allocation of blame. The control of the wool situation began in July, 1917, when $25,000,000 was set aside for the purchase of raw material. Prices had risen sixty-five per cent in the first months of 1917 from an already high level, although at that time there was no real shortage. Speculation and the familiar eff*ects of optioning and buying in anticipation of demand had elevated prices. Six million pounds of wool were bought at once and held as a dumping source to keep prices down. In October the Government — through the Quartermaster Department — purchased from the British Government (which had bought the entire Australian clip) 123,500,000 pounds of wool; and, in November, 325,000 bales more, though only 110,000 were delivered. In the same month the War Trade Board put all wool importations under license, with the proviso that no wool should be sold except to manufacturers without permission from the War Industries Board, and further that the Government should have an absolute ten-day option on all consignments and a continuing option on unsold residues. Imports from South America were prohibited. ' These measures put the Government in absolute control of imported wool. By exercising its option on the domestic clip, after April 6, 1918, on the basis of the market price of July 31, 1917, plus five per cent, that was thoroughly controlled. Exportations, except those that were to be returned in manufactured form, were forbidden. All of these measures resulted in a total net supply of 656,800,000 pounds of grease wool for 1917 and 503,800,000 pounds for 1918 — as compared with 821,800,000 pounds in 1916. The American production was in the neighborhood of 300,- 000 000 pounds. In these circumstances the allocation for civilian use was only 25,000,000 pounds in 1918, and was nominally only 15,000,000 for 1919. To handle the business resulting from the various control and purchase measures, the Government appointed a wool administrator to make purchases, a wool purchasing quarter- master to attend to finances, and a wool distributor to allocate it to manufacturers. It was hoped to augment supplies from WAGING WAR WITH TEXTILES 445 South America in 1919, and the Board's Foreign Mission procured 335,000 bales of Australian wool, but the outlook was so unpromising in general that attention was turned to possible substitutes. During the war raw materials increased in price two or three times and fabrics from 150 to 200 per cent. Govern- ment prices for goods were much lower than the manufactur- ers could have secured had trade been free, but at that profits were considerably above pre-war averages. Con- tracts were sometimes awarded without bids, but after the Government got a firm grip on wool there was ordinarily nothing to be gained by departing from the old competitive bidding system — the more especially as there was a surplus of manufacturing capacity. It must be remembered that one reason for dispensing with bids in so much of the Government procurement of supplies during the war was to prevent artificial rises in prices; but, as the woolens situa- tion was shaped, bidding would tend to lower prices. The handling of the wool and woolens business was necessarily in the hands of the trade. Those men who joined the Government are to be honored for their loyalty to their transformed allegiance, and their fellows with whom they dealt are entitled to great credit for their cordial cooperation. John P. Wood, of Philadelphia, who was chairman of the original cooperative Committee on Woolen Manufactures and later a member of the trade's war service committee, is to be credited in large measure with the high tone of the whole business. He determined at the beginning that honor was more important to the trade than profits from war work, and used all his vast influence to repress rapacity and to see that the Government was never in the dark, deceived, or misinformed in its dealings. If there were any crooks in the business, they could not succeed, because the Government had the benefit of the services of honorable men of superior acumen, who were insistent that the woolen industry should have a spotless war record. Readers who recall the attempt to stir up a shoddy scandal may question the justice of the recognition herein given to the woolen manufacturers. In truth, there was not the slightest basis of scandal. Aside from some of the early i|i>l i|i II • I • I i ti I 446 INDUSTRIAL AMERICA IN THE WORLD WAR gap-filling purchases, all Government fabrics were made to comply with rigid specifications — and those specifications called for a certain proportion of shoddy. "Shoddy" is a disreputable adjective, but it is an honorable noun. Shoddy is re-worked wool, and there are many grades and qualities. Ninety-five per cent of the best qualities of civilian over- coats contain a percentage of shoddy. An all-wool overcoat is an expensive luxury, for it is no better and perhaps not as good as a garment containing a proportion of good shoddy. Some sorts of wool actually make a distinctly inferior fabric unless mixed with shoddy. Moreover, most of the shoddy used in Government fabrics was simply the clippings from virgin wool fabrics before they left the factory. In the beginning, the army specifications called for all- wool overcoats. After the attempt to stir up a scandal because shoddy was found in some of the emergency clothing. General Goethals appointed a commission to fix specifications. This commission reported that the use of shoddy in certain fabrics was not only necessary and essential, but advantageous. A mixed fabric was just as durable, just as warm, and just as good looking. Moreover, if the economy of shoddy had been neglected there would not have been cloth enough to clothe the army, especially as the old specification of sixteen-ounce goods was abandoned and twenty-oimce specified as being more satisfactory for overseas service. The American soldier was the best-clothed soldier in the World War. There was nothing inferior by design or fraud in his equipment. "Army contractor" is no longer a stigmatic term. In cotton goods there was no problem of scarcity of material, as the United States produces more than half the entire cotton supply of the world. Here the task was one of mobilization and manipulation of the manufacturing industry to meet the immense, and, with reference to the different kinds of mills, imbalanced. Government require- ments. During the war the army alone bought 800,000,000 yards of cotton goods. They were required for khaki imi- forms, working clothes, duck for tents, webbing, gauze, Venetian, sheets, pillow cases, towels, and other purposes. WAGING WAR WITH TEXTILES 447 As with woolen goods, the tendency of the army was to exaggerate its requirements — partly from a laudable desire to provide against the developments of a war that could not be measured by any past experience and partly from the lack of any standards of calculating requirements. Tents, for example, were bought on the theory that there should be one big tent for every eight men, whereas, for the most part, the army at home was in cantonments and billeted in houses or barracks abroad. The first call for tents was three times the normal tentage productive capacity of the country. The situation demanded the cooperation of the representa- tive men of the industry, and they took hold of it in the same spirit of patriotic service and anti-profiteering that tlie woolen men did. They started out so strong that they incurred some opposition, but eventually the whole industry came into line. There was not very much enthusiasm for Government business in the early days of the war, as there was plenty of private patronage. So the rather amusing condition arose that the war service committee, without any authority, would be found bullying manufacturers into accepting allocations of Government orders. In the case of the tentage order, for example, mills were actually forced to take orders despite their claims that their machinery was not adapted to the manufacture of duck. The committee knew better. Again, in the summer of 1917, the army called for 50,000,000 yards for cotton uniforms, which was five times the normal annual production of the goods needed. Forth- with the committee swung over the biggest makers of ginghams and fancy colored goods to the making of a cloth 3iey had never touched before. Two such concerns — the Amoskeag Manufacturing Company, and Amory, Browne & Company — came through with 40,000,000 yards. On top of this army order, the navy turned up unexpect- edly with a demand for 5,000,000 yards of the same goods bleached. To meet it mills that were manufacturing for the foreign markets and others that were making sheetings for the domestic market were persuaded to sidetrack everything else and make the navy cloth. As if that were not enough, the army's Medical Corps, 'ii 4 « «i i 448 INDUSTRIAL AMERICA IN THE WORLD WAR which was disregarding the advisory committees, called for an enormous quantity of material for pajamas — but the mills that were prepared to make it had already been diverted to army orders; and so the service committee had to do some more vigorous extemporizing. Despite these vagaries of requirements there was never any shortage of equipment due to the failure of the cotton mills to deliver on time. Speaking of requirements, the Cotton Section was flabber- gasted one day by a hot demand for 100,000,000 yards of gauze from the Medical Corps. Consternation reigned until an officer blandly explained that by a trifling error three ciphers had been added to the figure desired. The big demands came from the Quartermaster Depart- ment. It acted through the supply committee, but the navy, the Ordnance, the Medical Corps, and other purchasing agencies insisted on going it alone. The manufacturers hated to do business with the army because it was so slow in paying its bills — but the committee compelled them to come through. For a time in the fall of 1917 there was very little coordination between the Government and the manufacturers. The informal war service committee that had been acting with Mr. Turner as the go-between was dissolved. Mr. Turner joined the Supply Committee, and then the army took over the whole job. When the War Industries Board got into the saddle again, there was a new war service com- mittee and various sub-committees with which it was articu- lated. Prices early developed a runaway tendency and the necessity of firm control soon became evident, but there was no authorized body to deal with the problem until the War Industries Board was thoroughly reconstituted. The Price- Fixing Committee established maximum prices on certain basic fabrics in July, 1918, and additional schedules were issued in the four following months. These were for the public as well as for the Government and the Allied Govern- ments. The matter of fixing prices for raw cotton was often considered, but, as explained in the chapter on prices, the final decision was against doing so. Manufacturers state WAGING WAR WITH TEXTILES 449 that their profits during the war were moderate considering the circumstances, running from twenty to thirty per cent as against a normal ten per cent. When Lincoln Cromw'ell, of William Iselin & Co., of New York, was called to the chairmanship of the Supply Sub- Committee on Knit Goods, he changed his partnership relations in such a manner that as a member of the firm he had nothing to do with nor could he receive any profits from knitting-mill activities. With his skirts thus cleared in advance, he used his business connections to get the cost- sheets of every mill he could. The members of his com- mittee followed his example and produced their cost-sheets. Then as committeemen, they turned around and did business with all the other manufacturers with the cards on the table. Mr. Cromwell happened to be in such a position that he could divest himself of business affiliations that might be embarrassing, but it was not possible for every big busi- ness man in the country to give up his business in order to serve the Government. Indeed, the Government needed them in their business. Certainly, the knit goods men set an admirable example of how to meet a double allegiance. With these low-cost figures before them, the committeemen bullied manufacturers into accepting contracts they did not want at fixed prices for all. "You can make ten per cent profit," the committee would say, "if you know your business, and if you don't you will have to contribute the rest." There were some hogs, some red-handed profiteers, and some pro-Germans to deal with in this industry. Then, too, the industry as a whole had a dislike for Government business, because of a widespread belief that through some crooked arrangement a certain firm had got most of the peace-time patronage of the Government. The idea of patriotic service did not take hold at first. It took time to grasp the deeper meanings of war. A group of good American underwear manufacturers who were still infected with the "business-as-usual" doctrine had a meeting at their club and resolved not to accept the price the committee had fixed. One of the men present thought it his duty to inform the committee of the determination of the meeting. So, 'I v\ y «i' ' ■ i 4 ll * f ^M 450 INDUSTRIAL AMERICA IN THE WORLD WAR when the delegate from the group called on Mr. Cromwell, the latter was prepared. "We'll take that business at this price," said the delegate, naming his figure. "Sorry, but we don't need you," said Mr. Cromwell. "When we do, I'll let you know." However, the delegate hung around the office the whole morning entirely ignored by Mr. Cromwell. Before he went home, he signed up for a million garments, which compelled the rest of the rebels to take the committee price, while excoriating him for a Judas. The Knit Goods Section performed the usual commodity section functions in relation to priority matters and the general facilitation of the industry. There were problems of conversion of mills to Government business, of securing supplies of needles, of ascertaining increasing costs with changing conditions, of new machines, of appallingly grotesque requirements and exasperating cancellations. Of course, with the army alone taking 80,000,000 suits of underwear and 90,000,000 socks from the knitters, to say nothing of other goods, the civilian had a hard time of it. He paid through the nose, but the Government, through its control of wool and yams and its inside knowledge of costs, had the manufacturers at its mercy and held them to the ten per cent profit on low-cost figure. The civilian had to satisfy himself with conservation darning and damning. The Textiles Division had many grave concerns and heavy burdens beyond woolen and cotton fabrics and knit goods. Felt was a field in which conflicting needs were always tying vexatious knots in a situation that was marked by a desperate shortage. Ask the man in the street what felt is needed for, and he might not get further than bedroom slippers, but the army wanted it for canteens, gas-masks, helmet, hats, caps, clothing, splints, shells, fuse-boxes pack- ing, airplanes, percussion caps, motor trucks; the shipbuild- ing industry needed it in large quantities and all sorts of machinery clamored for it. There was silk, which was mostly a puzzle of how to provide coarse silk for bags for the propellant power of big guns; flax, which was needed for linen and had to be got from abroad, with the British needing WAGING WAR WITH TEXTILES 451 it all for themselves; jute, hemp, and cordage, which were involved in the nitrate, packing, shipping, and ship- equipping tangles of the ever-entangling war game; and there was kapoc from Japan, for life-preservers; cork from Spain for linoleum, and so on. Conservation and curtail- ment were resorted to freely. The story of textiles is one of the great industrial dramas of the war, and in it the big men of the industry played fine parts. More than any other industry, perhaps, the experience of its manipulation for Government purposes reveals the soundness of the original Raw Materials Com- mittee idea of making contacts between business men in industry. With all the control its monopoly of wool and its domination of demand gave the army — and even with the aid of supply committeemen taken into its procurement branch — it found that it had to fall back on the War Industries Board and its commodities sections for that efficiency of articulation which is summed up in good management. 14 I. { • I > { (, \ I CHAPTER XXVIII THE IMPLEMENTS OF WAR BEHIND THE LINES Quantity production in a machine-made war — No grinding machines, no air- planes — Reducing standardization fever — One of the industrial heartbreaks — Anchor chains for merchant ships. A MAN and a machine are equal to thirty men. Hence the magnitude of modem war. The ancient wars were fed by supplies produced by slave-power — a power virtually with- out means of multiplying itself. The wars of the feudal age were measured by the productive powers of serfs with rude tools and of artisans without machinery. The wars of our time are sustained by machines which do not depend on human energy and muscular strength, but on the genii of steam, electricity, and gas which science has summoned from their repose of ages. When Caesar went to war, the slaves went to work; when the knights of the crusades set out for battle, the humble craftsmen hammered and sawed. Neither slaves nor com- monalty could be made to order. When the modems war, they call on the machines and provide more machines. Meas- ured by machine-making capacity, the war-power of the United States at the end of 1918 was two and a half times that of Germany and ten times that of England — and war was taking nine tenths of the American product. The demand for machines with which to make war machines and products — that is, tool machines — had mul- tiplied the American producing capacity four or five times in eighteen months. It takes anywhere from a month to nine months to make a machine tool — which explains why America seemed to be slow in getting into production of the goods and implements of war. All the orders given by the war-making agencies bred requirements for machine tools, and thus in the end came back on the machine tool industry. In the case of some war implements, such as airplanes, the manufacture of which was previously non-existent in this country, the entire machinery equipment of all the plants set THE IMPLEMENTS OF WAR BEHIND THE LINES 453 to the task had to be built from the ground up — thousands of elaborate machines for each plant, and hundreds of thou- sands of tool attachments. In this quantity-production coun- try everything goes back to machine tools and their making. The Air Service, for example, required 125,000 different articles for its equipment — and probably every one of them had its origin in machine tools — tools that had to be made in thousands of instances. The task of providing machine tools would have been over- taxing at best, but when it is added that seventy-five per cent of the industry was in that maelstrom of the congested region of the northeastem section of the country, where the shortage of fuel, transportation, and power confronted a cloudburst of orders, the job became so stupendous as to appall the stoutest heart. Fortunately, the number of makers was relatively small -i- about four hundred — and the majority of the machines required were standardized. This made it possible for the Machine Tool Section to keep track of orders, production, and delivery in a remarkably complete way by means of a card system. The section was thus currently informed of every order every manufacturer had received. The manu- facturers kept duplicate cards. By means of these cards, which normally recorded twenty thousand orders, the section could determine when delivery could be made on a new order of a certain grade of priority and what unfilled orders would be interfered with by the priority assigned to the new order. Thus, a remarkable degree of coincidence of delivery with time estimates was attained. The cards gave the Priorities Committee the basis of shift- ing priority and also of determining the need of priority for fuel, materials, and labor. Notwithstanding a great shortage of labor and materials, the industry was in a position at the end of the war to have extended even more assistance to the Allies than it had been giving, besides taking care of all of our Government's requirements. Owing to the fact that war requirements bore more heavily on some lines of machines than on others,^ George E. Merry- *Mr. Merryweather's assistants were: Alvin B. Einig, Arthur J. M. Baker, Roland Houck, Ernest D. Crockett, Floyd C. Lowell, Walter L. Ditforth. i 1 *ii li 454 INDUSTRIAL AMERICA IN THE WORLD WAR weather, the chief of this section, had to resort to a diversity of conversions and adaptations. Plants that had not been making a certain tool at all got jigs and fixtures and patterns from plants that had been. Manufacturers of water wheels turned to lathes; one printing-press manufacturer made slot- ters; another made milling machines and lathes. Owing to the suspension of building operations, several hundred stone planers were idle, and they were turned to certain rough operations in ordnance work. On one occasion. Colonel E. A. Deeds, who was then chief of the Equipment Section of the Aircraft Production Division, informed Howard E. Coffin, chairman of the Aircraft Pro- duction Board, that the whole aviation programme was blocked because of the lack of cylinder-grinding machines. The only manufacturer was threatened with a strike, his superintendents had quit, and his plant was demoralized. There was one other concern which had made such machines, but it was gorged with other A-1 priority work. Mr. Merry- weather instantly called up a manufacturer in another line that was not essential. This man went to the full-up plant, got their patterns and drawings, came to Washington the next day, got an order for fifty machines, and was soon turning them out. The machine tool emergency was met to a material degree in the first part of the war by commandeering machine tools made for export which, owing to shipping difficulties and other reasons, had been lying on the docks for months and years. The Ford Motor Company was thus provided with airplane cylinder grinding machines on twenty-four hours' notice. One of the biggest things Mr. Merryweather did was to kill a general standardization suggestion that was evolved in the War Department during an attack of unusually severe standardization fever. To have reduced all machine tools to uniform standards would have stifled production for many months. Owing to the length of time required for the production of machine tools, the inability of the army to forecast require- ments caused more trouble here, perhaps, than the lack of comprehension of requirements in any other line. The navy. THE IMPLEMENTS OF WAR BEHIND THE LINES 455 as in most requirement matters, functioned better than the army owing to its superior pre-war organization and to the comparative simplicity and smallness of its needs. Despite all of Mr. Merryweather's efforts to look ahead, his section was continually confronted with insistent calls for machines that had been overlooked or were demanded by some unforeseen and, possibly, unforeseeable develop- ment. His task was lightened by the cheerful and intelligent cooperation of the industry, which not only made the machines, but contributed its engineering knowledge and experience freely to the section and to the various procure- ment agencies. Sometimes the industry had to design or choose machines before the army officers could get to the stage of knowing what to order; as, for instance, in the machine production in this country of the carriage of the French 75 mm. guns, it required fifteen or twenty experts of the industry to figure out what kind of machines and how many would be needed. All of the things that have been mentioned give but a slender conception of the magnitude, difficulty, and complex- ity of the work of the Machine Tool Section. And that is true of almost all of the sections of the War Industries Board. Multiply the problems and deeds of one section by sixty, and one gets his imagination primed for a hazy conception of what the War Industries Board had to do and did do. One of the industrial heartbreaks of the war was in the manufacture of cranes. Because of some blunder or failure of coordination, a great battery of sixty huge gantry cranes, planned with amazing prevision and built with wonderful dispatch — intended for the equipment of the vast wharves, piers, and docks the A.E.F. had to erect in France in order to make it possible to land millions of men and their enor- mous equipment and mountainous supplies — lay for eight months at the seacoast on this side of the Atlantic. Yet each of these cranes meant five or more days saved in the unload- ing of a vessel — and those five days were equivalent to an increase of fifteen per cent of tonnage. Engineers of the crane-making companies went to France with the army engineers and worked in such close touch with them in planning the port bases that the plants in this country ^ r i i f \ \ 'i t li' ■1 I I i I \ • 456 INDUSTRIAL AMERICA IN THE WORLD WAR were ready to start on production full-speed ahead the moment they got the word. The cranes were turned out with a speed that was the amazement of the builders themselves and, in cooperation with the Engineer Corps of the army, which lived up to its reputation for efficiency and celerity, crews of civilian erectors were dispatched to France to set the cranes up with all possible speed. Then came the tragic climax. Somebody on the other side had disregarded the engineers on this side and had built docks that could not sustain the great gantry cranes, having made up his mind that cheaper temporary construction and improvised unloading contrivances would fill the bill. It was one of the most costly errors of the war, as well as inex- pressibly agonizing to the section, the engineers and manu- facturers. Somehow, two or three of these cranes did get across, and being there some one decided to strengthen a dock and put them up. When they got into action, the improvised cranes and derricks looked like a horse express wagon along- side an eight-ton truck. Immediately a shout came back from France for the rest of the ordered cranes and twelve more. But eight months of critical time had been lost. The way the Crane Section dealt with that tragic consign- ment for France was typical of its performance throughout the war. In its head, Alexander C. Brown, the War Indus- tries Board had a man who had the confidence of the in- dustry and it followed his lead with enthusiasm. Primarily organized to handle locomotive cranes, which the Emergency Fleet Corporation needed in great numbers for the ship- yards, the section came to look after other shipbuilding cranes, coal-handling machinery of all kinds, and overhead electric traveling cranes. , „ ., i a j • • * Between the Fleet Corporation, the Railroad Administra- tion, the Engineers, the Ordnance, the Quartermaster Depart- ment, Aircraft Production, and the Allies, the section was soon confronted with an insistent demand for hundreds of cranes. These were carefully allocated with respect to urgency among the existing plants and then steam-shovel builders and other allied lines of industry were called into the conversion breach. The number of locomotive crane- THE IMPLEMENTS OF WAR BEHIND THE LINES 457 builders was thus increased from seven to eighteen, and by October, 1918, the output of the great lifters and conveyors, of standard and special designs, had been pushed up from fifty to three hundred and eighty a month, thus providing the colossal construction and manufacturing plants and trans- port evoked by the war, with giant hands and arms of fitting might. Chains — even the big anchor chains — would seem to be a small thing in a big war programme. But they were not. Despite all that was done by the Chain Section^ and the Emergency Fleet Corporation, anchor chains could not be forged fast enough to keep up with the demands of the impressive column of merchant ships that left the ways at the rate of four or five a day when American energy got its bearings in the war-enforced revival of the shipbuilding industry. In the midst of the ship famine, completed ships could not sail for lack of anchor chains. Despite all efforts the chain-makers never did catch up with the shipbuilders; the handicap was too great. Nobody could have foreseen, in the winter of 1917, that within a year America would be producing more ship tonnage a week than it had formerly turned out in a year. To meet the emergency, cast steel chains were conceived, but the armistice came before they got into production.^ The Hardware and Hand Tools Section had some interest- ing experiences. It came into contact with a curious phase of the incidence of priority. Many concerns within the prov- ince of the section, which were among the industries that had been curtailed, fearing that their low priority standing would result in shut-down, came to Washington and got Government contracts at any price in order to get a better priority rating. The practice threatened to upset the whole priority scheme, but, whether it would have resulted in the Board's substituting suspension for curtailment in the offending industries, or a modification of priority administration to meet this attack by infiltration, was not determined before the armistice threw Uohn C. Schmidt, chief. *Many of the problems relating to machinery were the concern of the Resources and Conversion Section, dealt with in Chapter XII; and the section on forgings, ordnance, small arms, and ammunition discussed in the same chapter. 1 1 I I' 1 i a \^\ I I 458 INDUSTRIAL AMERICA IN THE WORLD WAR the problem into the scrap-heap. The section had to do with fourteen of these rationed industrial groups, and the progress of the war had, for them, turned a feast into a famine. With the despair of hunger they fought for means of sustenance. On the side of shortages, the manufacture of needles gave the section the most concern, as the United States had left them mostly to Germany and England. A shortage in sad- dlery hardware started prices ballooning, but was met with- out price-fixing. Ships' hardware was another shortage prob- lem. Carrying the trade cooperation idea of the Board to the reductio-ad-absurdum limit, the manufacturers of horse- shoes, and also the manufacturers of hydrants and valves, created tight monopolies and insisted on dealing with the Government as units, refusing to make bids or otherwise deal individually, though there was no shortage of their products. The error of their ways was pointed out to them, and moral suasion, and, perhaps, the shadow of the anti- trust laws, caused them to break up their unity. After the metal bed manufacturers had been curtailed fifty per cent, the influenza epidemic set in — and there were not enough beds. The manufacture of toxic gas crowded the manufac- ture of fire extinguishers out of their supply of tetrachloride — and so fire extinguishers were scarce and costly. And so with this section, as with most of the others, it was one problem after another; the solution of one often breeding others. CHAPTER XXIX POWER AND TRANSPORTATION AS FIGHTING FACTORS The power-fuel problem — Conserving electrical power in congested centers — The riddle of steam turbines — Automotive engineers in the war game-^ Creating the heavy-duty truck — Nine thousand locomotives demanded. In the cycles of war all things depend on power and trans- portation. Amputate a piece of a straight line, and you still have a straight line left. Take a sector out of a circle, and you have nothing. In the World War, cause and effect pur- sued each other around circles until it was impossible to determine their primary identities. Power and transporta- tion loomed large in these vicious circles and were entitled to respectful consideration for their claims that they were the primary factors. With equal propriety innumerable other factors could put forward a similar contention. They were all right; a circle exists only as a whole. In the larger sense transportation was lodged in the Rail- road Administration and in the Shipping Board and its tre- mendous Emergency Fleet Corporation. In like manner power was primarily in the hands of the Fuel Administration, for fuel oil, gas, and coal are power. The complete history of power and transportation in the war would, therefore, include a narrative of those three administrations. In a previous chapter rather full mention was made of the close articulation of the Railroad Administration and the War Industries Board, whereby the former functioned for the purposes of the latter just as directly and immediately as if it had been a subsidiary. The cooperation of the Fuel Administration has been often noticed, but perhaps it has not been given the emphasis it is entitled to. The War Industries Board encountered the power-fuel problem at every turn, and its full mastery was essential to the application of the all-powerful lever of pri- I I m\ \ •1 ii 460 INDUSTRIAL AMERICA IN THE WORLD WAR ority A conflict or serious friction between the administra- tions of industries and of fuel would have been catastrophic. Fortunately, there was the fullest and most unselfish partner- ship between the two. For all its purposes the War Industries Board could at all times count on the Fuel Admmistration as certainly as on one of its own divisions or sections. McAdoo and Garfield were constant and potent allies ot Baruch. Chairman Hurley, of the Shipping Board, was more a law unto himself. The Shipping Board was never knitted into the fabric of the War Industries Board as were fuel and the railways. It cooperated, but it did not amalgamate. r i wr t j * • Power came directly under the sway of the War Industries Board in the electrical form, whether derived from fuel or water power; for in this form it was a commodity of well- defined sources with many consumers, whereas steam power was essentially an integral part of each industrial unit, and, therefore, essentially a matter of fuel, except on the side ot generating instrumentalities. In hydro-electric power the Power Section, of which Frederick Darlington was chief, had to do with both the distribution of power and the problems and machinery of its generation. But the administration was a rather complex one, being really three- and even four- Charles K. Foster, who was vice-chairman of the Priorities Committee and represented Judge Parker on the Priority Board when the latter was absent, was specially charged with all priority and requirement matters relating to power, in a manner and degree that made him an active manager as well as an arbitrator of priorities. Then, power matters involving new construction had to be cleared through the Facilities Division. Finally, the Army Engineer Corps was responsible for studies, surv^eys and investigations, and recommendations, and the staff of regular and temporary engineer officers dele- gated to this task acted also in a large degree in an executive capacity for the section. General Charles Keller, United States Engineers, was in charge of the engineering aspect, and he and R. J. Bulkley, who was chairman of the legal committee of the War Indus- tries Board, and C. B. Davis acted as associates of Mr. POWER AND TRANSPORTATION 461 / Darlington's, Captain W. W. Stanley, of the army, being executive assistant. Percy H. Thomas, a New York engineer, acted as special consultant. All of this sounds rather com- plicated, but the combination, which appears to have com- bined the values of military prestige and authority with those of civilian tact and adaptability, worked very harmoniously and effectively. The Power Section proper was not estab- lished until December, 1917, although Mr. Darlington had been previously acting as consuUing engineer in power matters. The section, among other things, advised the Capital Issues Committee when application to that committee for authority to issue securities concerned power projects, and also the War Finance Corporation in regard to loans of a like nature. It also acted in close touch with the Electrical and Power Equipment Section, of which Walter Robbins was chief. The shortage of electrical power in some of the congested centers, such as Pittsburgh, Buffalo and Niagara Falls, Philadelphia, Akron, Ohio, New Jersey, and a number of places in the South and elsewhere, became alarming in the fall of 1917 and the winter of 1917-18, and it became neces- sary to apply the priority principle very strictly, rationing and even withdrawing all power from some non-war indus- tries. Ice, drought, low water, coal shortage, and congestion of transportation battered at the citadels of power and made many an ominous breach. In Pittsburgh, conservation of power was carried so far that electrical heating was denied to street cars, and the whole eastern half of the country endured the famous five heatless and lightless days which caused localized outbursts of popular rage. Had the war not interfered with the normal development of power plants, perhaps there would have been enough power in all the congested centers; but, as it was, it became the duty of the section and the interested departments — the Shipping Board, the War and Navy Departments — to develop additional power. As private development under war conditions of a degree of power that might not be needed for some time under normal conditions was out of the ques- tion, it was necessary for the Government to undertake the ) •! ill f) fill ' » T ii^ ^ When the comitry was divided by TeS Administration into beet-sugar and cane-sugar zones It was discovered that beet sugar was not adaptable rSdicinal purposes, and the correspondmg adjustments had to Cmadl When the influenza epidemic came on, the Research Comicil took up the production of aspirm. The Stent had expired, but Ae Bayer Company claimed the Same Also production had been curtai ed because one of ^.^narp^ipnts was in great demand for airplane dope. '%^X Ino™ production of industrial chemicals usedTmelines, the latter were often on the verge of being excluded from their relatively small requirements. There m A T K,>an was assigned to surgical instruments and hospital furniture J^e^u^pmen^ri "r^^^^^^^ to medical chemicals. THEY ALSO FOUGHT 473 were not enough artificial eyes, and maimed civilians had to wear eye-laps to let the wounded fighters have the eyes. The shortage of steel made it advisable to substitute wood for iron in bed-frames for cantonments, camps, and industrial housing, and the Field Medical Supply Corps called for two hundred thousand wooden bedside tables. The Army Medical Department objected on sanitary grounds to both beds and tables, but Judge Parker ruled in favor of the wooden substitutes. Nevertheless, the matter was still in abeyance when the armistice came. These were only a few of the section's concerns, which included all of the duties customarily performed by the various sections of the Board. Price-fixing was not attempted, although there were some tremendous advances in prices, as it was felt that high prices were stimulative of production. Acetiphenetidin, for example, which sold at 84 cents a pound in 1914, jumped to $42 in 1916, but got down to $2.75 after American manufacturers took it up. The average price of medicinals at the end of the war was about 320 per cent of normal. Tobacco may not be ranked as one of the indispensables of life, but in these times a smokeless army would be a fightless one. If it be considered one of the essential materials of military preparation, the United States could carry on forever under a water-tight blockade. There was really no shortage of tobacco in its various forms at any time during the war, though a larger proportion of the soldiers and sailors smoked when in the ranks than when at home and their average individual consumption was seventy-five per cent greater. The Quartermaster Department calculated that each soldier would consume two pounds i f 1 1 I I 476 INDUSTRIAL AMERICA IN THE WORLD WAR by which the industries of America supplied them. But, when the histories of these times are finally written, the brilliant records for posterity will be found, not only in the battle-fields, but equally in the offices and mills that planned and produced, in the ships and railways that carried, in the great coordinations that wielded for the first time all the strength of nations of scores of millions multiplied by the powers of steam and electricity. The pomp and circum- stance of war will always fascinate, but, as time goes on, men will be more and more interested in the accounts of how the mastodonic nations of modem times were brought to exercise all their powers and put them into effective applica- tion behind armies that demanded and consumed so much more than all the other hosts that have gone to battle in this world of wars. We are still too near the deeds of the inarticulate figures in sack suits who directed the outpouring of America's productive powers for war's demands to realize that supremely able men came to great tasks. When the war was over, they did not march up Fifth Avenue to the cheers of their admiring countrymen. Tired in many cases, utterly drained from long effort and depressed reaction, they shut their Government desks and trickled back one by one to the old desks in the offices of everyday business and industry. For the individuals of the generalship of the industrial forces there was neither present distinction nor hope of future fame. They wrought in the anonymity of association. While they labored, they were worried by fault-finders, and when they went home, they were followed by the din of investigators who sought to advertise themselves by searching out here and there some muffed detail of execution in the work of men who toiled fiercely in the press of war "at a ten-league canvas with brushes of comets' hair." But a nation of industrialists will eventually do honor to the leaders who led in industry in war. The men of the War Industries Board, and those who preceded them in too loosely joined committees and boards, deserved well of their country, and, though their deserts are not symbolized in triumph, they will eventually come into them. We have seen the narrative, with some explication, of APPRAISAL 477 their work unfold in the preceding chapters, and it remains but to underscore here and there the record of an extraor- dinary achievement in an exceptional time. Perhaps the best proof of the quality of the service ren- dered by the War Industries Board was that there was so little shock and confusion when it let go of the reins of power. "The basis of political economy," says Emerson, "is non-interference. The only safe rule is found in the self- adjusting meter of supply and demand. Do not legislate. Meddle and you snap the sinews with your sumptuary laws." That was the belief of men who were called on to deal with the consequences of the huge meddling of war. The meter was no longer self-adjusting, but they sought in all their controls to align themselves and their ordinances with the nature of men and the flow of events. Believers in individualism, they had avoided nationalizing industry while directing it nationally. Believers in the initiative of the free man, opponents of paternalism, devotees of the free play of economic forces, they yet had found a way to harness industry and commerce and to drive them without harsh curbing or paralyzing domination. So far as the War Industries Board was concerned, it let go of its control of industry when the armies ceased to fight. It refused to believe that there was any problem of decontrol, and this belief was based on its knowledge that it had not deprived industry of its individual vitality or robbed it of its internal energy. It had massed industry for a common purpose, but it had done so according to the genius of individualism. With actual or conceded powers that were almost unlimited in extent, it was as far as possible from being comparable to an autocratic bureau. It was demo- cratic in purpose and method, and yet, except for price- fixing in the later stages, the power of decision was singular. Its methods are deserving of the closest study of statesmen, for they combined the efficiency of autocracy with the spirit of democracy. After May, 1918, its charter consisted of a definition of purposes and virtually imlimited power to realize them. This power and this responsibility were lodged in one man. It was, therefore, the very antitype of the ordinary \» » i ■ 5 !li i; 478 INDUSTRIAL AMERICA IN THE WORLD WAR governmental bureaus, whose powers and duties are defined with such minute detail that their heads are little better than automatons; with the result that equity is sacrificed to legalism and efficiency to formalism. We cannot expect great administrators under such conditions. The civil ser- vice will not be sought as a career by men of talent and genius for administration, if there be nothing but forms for them to follow and no outlet for originality and initiative. The history of the War Industries Board shows us how much better government might be if we could draw to it the type of men who so faithfully served that body. In a broad way of speaking, the best men of America are not in politics or government because public life does not provide the , play for the individual genius that is found in finance, commerce, and industry. Private life coheres and prospers because it is based on confidence, which endows its leaders with power and respon- sibility. Public life disintegrates and fails because it is based on suspicion and manacles its leaders with impotency and irresponsibility. Government will continue to be mediocre, blundering, and inefficient until the place seeks the man, and not the man the place. And that will not be imtil office becomes an opportunity instead of a strait- jacket. The function of the War Industries Board was to shape production and its incidence to meet the huge and exceptional demands of war. This involved a knowledge of require- ments, a reliable cataloguing of resources, a system of precedence or priority, the regulation of prices; and the direction, restriction, and stimulation of industry. Neither the origin nor the current of requirements was within the control of the Board. Considering them as they came to the Board — and not as they might have been presented — they were dealt with brilliantly. They were dissected, analyzed, reduced to commodity equivalents, translated into terms of labor, power, finance, and transportation, and transmitted to industry in the orderly channel of priority. Order and regularity thereby succeeded chaos, but the sys- tem never precluded the exceptional, and no emergency was denied because of the ease of routine. APPRAISAL 479 On the side of resources, the Board's achievements were remarkable. These were in reality almost as unknown and variable as requirements, and the existing data were gro- tesquely inadequate. As the rising tide of war demands covered one commodity after another, the Board ascertained actual and potential resources with celerity and exceptional accuracy. Its use of the data when obtained was prompt and highly adaptive. Its use of the instrumentalities of conver- sion, curtailment, and conservation as applied to resources and facilities was cool and deliberate in the face of panicky demands. It never forgot that, while it was called upon to give excessive temporary enlargement to some of the organs of the economic body and to shrink others, the alterations must be such as not to weaken the body as a whole. Its course with regard to the so-called non-essential or non-war industries was commendably cautious. It acted in this respect with the consciousness that, in such a complex fabric as modem industrialism, with its often obscure but powerful inter- relations and reactions, psychological as well as economical, it was a dangerous and difficult task to distinguish between the essential and non-essential. It saw, in many an appar- ently dispensable trade of manufacture, functions analogous to those of the ductless glands of the human body. The method of controlling prices adopted by the Board was rational and fundamental. It dealt almost entirely with materials rather than articles. It thereby checked price inflation at the source and tended to eliminate the evils of pyramiding. Practically all the great increases in prices in commodities were checked when the Board began to establish prices, which is to say that prices were not inflated by the entry of the United States into the war. Roughly, the peak of prices was reached about the time or just after the United States became a belligerent; but these were fictitious prices, and Government purchases of the basic commodities were made at lower and stabilized prices, thanks to the success of the Board or what became the Board in negotiating prices by agreement before it had the power of price-control. This mastery of rising prices precisely at the time when { i I 480 INDUSTRIAL AMERICA IN THE WORLD WAR the enormous war demands of the greatest of the warring nations were added to an already extraordinary demand, was one of the most brilliant economic successes of the war. In this field the War Industries Board was distinctly fore- handed. The credit for this pivotal success is due to the foresight of Mr. Baruch and to the patriotism of the masters of production. It saved the country billions and incalcula- bly checked inflation. In the beginning Mr. Baruch had very little support from the great financiers and bankers of the country. They still clung to the idea that supply and demand should be left to work out their own price destinies and that Government should not place artificial trammels on business, appearing to ignore the fact that, by its act of entering the war and becoming the creator of a demand that could not wait, the Government had made an artificial condition of demand which would be hopeless against an uncontrolled supply. The financiers saw in mounting prices an easy way of financ- ing the war by taxation of profits, but seemed to ignore the dragon's-teeth crop of by-products of the resulting insta- bility of prices. It is not to be inferred that because the Board stabilized and held down the prices of certain commodities to the Government, the Allies and the private consumers thereof, the public benefited accordingly. The middlemen and retailers absorbed a large part of what the producers gave up. How much could have been accomplished in this field is dubious. The experience of minute price-control in Europe parallels the failure to date of the enforcement of prohibition in this country. We know now that law is not always omnipotent. Yet it became apparent that the main- tenance of the public morale required a measure of control of retail prices of some of the necessaries. As the end of the war approached, the Board was girding itself for this diflScult and delicate task. The conception of the scheme of priority and its applica- tion was perhaps the greatest achievement of the War Industries Board. It was at once the source and the manifes- tation of power. Caught in the clutch of priority, there was APPRAISAL 481 no escape for the obstinate. Primarily a device for provid- ing, it became an irresistible weapon of compelling. An insurance of maintenance to the faithful, it became a terror to the false. Conceived as the "routining" of a nation, it became also its discipline. Ostensibly a contrivance for dependable delivery, it became also one for withholding. It was at once the comfort of the willing and the scourge of the unwilling. To be stricken from the preference list was to be damned ; to be on it was industrial salvation. Unknown to the written law, it became the greatest law of the land. The manufacturer who sinned against priority sinned against his business life. It was power over all commercial environment. All else that the Board did in the regulation of trade, industry, and transportation issued from priority. Price- fixing was but an annex to priority, for in priority the Board held the factors of compulsion that induced reasonableness of desire and gave knowledge and control over the factors of prices. Thus priority brought not only order and system, but power and its whip. And yet the astonishing thing about priority as practiced in America was its automaticity. Men and industries sorted themselves and their tasks as they entered the ordered maze of priority, much as crowds entering a stadium assign themselves to entrances according to numbers or the colors of their tickets. Each contractor or manufacturer was put on his honor to determine the color of his card of admission, according to certain general rules. That there was an occasional abuse of individual deter- mination cannot be doubted, but in the main it was exercised with fidelity and discretion. The exceptions were as nothing compared to the advantages of self-determination. The arbitrariness and the possible favoritism of a universal use of permits would have challenged evasion and involved external policing. The self -application of priority was in harmony with the genius of America. It was the most signal demonstration of the rare talent of the Board for direction in accordance with human nature in its American variation. It was to this subtle sagacity that we must attribute the Board's rapid progress latterly toward general control of the whole industrial field and centralized direction of all hi ,1 4. 482 INDUSTRIAL AMERICA IN THE WORLD WAR the economic activities of Government, with so little friction and so little general realization of its grasp on power. Con- cerned always with centers rather than peripheries, its con- trol was often obscure when most dominant. Much of its best work was accomplished through independent agencies, notably the Fuel Administration, the War Trade Board, and the Railroad Administration. Its own organization was but slender. The growing brain of the whole body of war enterprise, deriving power from the use of power, it came to be the head center of the entire economic activity of the Nation. Many-willed America had never known or even dreamed of anything comparable to it. Great captains of industry accepted its decrees as inevitable, and its will touched the remotest hamlet and farmstead and shaped the commercial life of crowded cities. All industry and all commerce were conformed to its policies. Like Camot, the great war minister of the French First Republic, it was the organizer of victory. And not alone for America, but to a very important extent for the Allies. All-productive America was the commissary of its own armies and of those of the Allies. Thus the War Industries Board was comparable on the side of economic power to the American army on the side of man-power. The analogy is complete in theory, but was not so in practice. The Nation conscripted its men by direct statute, but not so with its resources. In another war the principle of the selective draft should be applied to dollars as well as to men. Industry should be persuaded to cooperate of its own initiative as in the World War, but behind all indus- trial mobilization should be the formally adopted principle of conscription, which is the direct inference of the con- ception of modem war as a war of all persons and things. Resources and facilities should be used with as little thought of profit as human life is used. In considering the work of the War Industries Board for the purpose of learning how to prepare for industrial mobilization for another great war, our military authorities and Congress should not over- look the fact that the selective draft of industry is the logical twin of the selective draft of men. In the next war all APPRAISAL 483 industry — the whole economic life of the Nation — as well as human life should be conscripted. As has been said in Chapter IX, "Nothing undermines the will to war so rapidly as the popular conviction of widespread profiteering and exploitation." It is yet too early to determine how much the War Depart- ment and the army have learned from the industrial and commercial experience of the World War. With an amazing but familiar lack of foresight. Congress has made no pecuniary provision for the maintenance of a sl^eleton liaison between the army and industry, though the Assist- ant Secretary of War is made responsible for the articu- lation of military and industrial forces, and there is slowly evolving a plan of familiarizing in peace-time a nucleus of officers with industrial problems and processes and, con- versely, of acquainting manufacturers with military require- ments. Coordination of requirements is being studied and resources and facilities are being classified with the intent that in another emergency every great manufacturing plant will know what will be required of it. So far as the present officers of the General Staff and the supply agencies are concerned, the lesson of broad geographical distribution of requirements seems to be reasonably well understood, as well as the fact that all articles must be translated into terms of commodities. Considering the lack of financial provision and the civilian reaction from war and all that pertains to war, it appears that a certain amount of progress is being made in that pre-war provision for military and industrial part- nership which is the sine qua non of the integration of the full military power of the Nation. Such progress, how- ever, will inevitably be restricted if, indeed, not wholly valueless, unless qualified industrial experts from civilian life are allowed to mould the programme of whatever indus- trial preparedness may be ours. No one who witnessed the spectacle of an American war department, thrust unprepared into a great modem conflict, going down for the third time in an uncharted sea of industrial-military problems, could come to any other conclusion. It was the civilian experts of the War Industries Board who saved this situation from '!' { S I h f m\i 484 INDUSTRIAL AMERICA IN THE WORLD WAR actual tragedy; they or their like should have the controlling voice in making humanly possible the avoidance of a similar condition. The subject of industrial preparedness should not be left without pointing out that in another conflict methods must be devised to prevent Federal post-war repudiation of con- tracts entered into in good faith by business men. Such repudiation can be unnecessarily cruel and is calculated to reflect in an ugly way on the honor of a great country. And it is shortsighted policy, no matter how loud the demands for post-war retrenchment may be. It is not easy to determine what permanent influences the War Industries administration may have on American industrial practice. After a short business lull the war was followed by a brief boom and that by the depression of 1921-22, and neither condition was suitable to the dis- closure of permanent efi"ects. The efl'orts of Herbert Hoover, as Secretary of Commerce, to promote the economic well- being of the country through revisions of commercial prac- tices, however, show that the lessons of the experience of the War Industries Board have not been wholly forgotten. It is probable that there will never again be such a multiplicity of styles and models in machinery and other heavy and costly articles as there was before the restrictions necessitated by the war. Undoubtedly, the discovery that traditional methods had involved the excessive use of ma- terials for many purposes will be remembered and applied. The revelation of the possibilities of conversion and the ease with which supplies of manufactured goods can be produced to meet the most extraordinary demands will result in satis- faction with profits that will not be too attractive and in a better balance between production and consumption. It is also likely that, even if some public statistical agency does not undertake to appraise supply and demand in the whole field of industry, individual corporations and indus- trial groups will concern themselves much more with the gathering of data that will make possible the avoidance of periods of extreme surfeit as well as of extreme scarcity. In this manner commercial and industrial stability will be promoted. It is admitted that in many important lines APPRAISAL 485 producers are as deficient in their knowledge of future requirements as the army was in the beginning of the war. The efl'orts of the War Industries Board to ascertain all requirements — public and private — for the commodities with which it was concerned, and its complete survey of production, was a hint to thoughtful business men that some such orderly counterpoising might be possible in peace. Industrial control for war purposes, like military control of fighting men, is of little avail unless it is primarily stra- tegic. The strategy of physical conflict was long ago developed, but, prior to the World War, industrial strategy was almost unknown except in the crude form of blockades by force. In none other of the Allied countries was industrial strategy in both its domestic and external phases so far developed as it was in the United States toward the end of the war. The game of commerce, finance, and pro- duction was played throughout the world in support of the armies of the Allies. We are now come upon a time when it is the business of Government to direct the strategy of industry for its nationals in the bloodless contests of trade. If for a time war shall be banned, the foreign activities of Government should be directed to securing by industrial strategy what in other days was obtained by military force. The flag was formerly sent ahead of trade. Now consolidated national intelligence must promote trade. The Department of State should work hand-in-glove with the Department of Commerce to open and hold the markets that our over- developed manufacturing industries need for full-time pro- duction. There are substantial indications that this con- ception is being adopted by those departments and that the beginnings of a settled policy of commercial strategy are being made. The ideas conceived and applied by the War Industries Board in war are being applied in peace by the Department of Commerce, and some of the executives of the former are assisting in the evolution of the commercial strategy of peace. The commodity section plan has been adapted to peace- time needs in the Bureau of Foreign and Domestic Com- merce, and the Census Bureau has made the beginnings 11 M • s J! •I 486 INDUSTRIAL AMERICA IN THE WORLD WAR of a continuous commodity sun^ey. As in war, the com- modity sections stood between Government and mdustry — that is, between requirements and supplies — so now the commodity sections stand between foreign trade wants and domestic sources of supply. All of the lessons m the advantages of cooperation learned during the war are not being forgotten. The new commodity sections, so far as they have been formed, deal with essentially the same com- modity production groups as the War Industries Board assembled. . - Here we see the beginnings of the application m peace ot the idea of nationally directed industrial strategy. It is plain that we are to confront nationally directed commercial strategy by our competitors carried to such an extent that it is doubtful if we can successfully meet it without some reorganization of the Government and a delegation of authority that Congress will be reluctant to make. The con- trol of shipping, the tariflf, taxes, railway tariffs, foreign finance need to be centralized in some administrative body, as they were more or less centralized in the War Industries Board. • • j How to maintain the price benefits of free competition, and obtain the benefits of the economies that can be effected only by association and united effort, is a difficult problem. However it may be solved, the fact will remain that the War Industries Board was the pioneer revealer of the immense wastes of production as generally conducted, and the greatest of demonstrators of the possibilities of econo- mies. In the long run economy must find a way to prevail. Tremendous wastes of service and material cannot be tol- erated in the lean and laborious years that are before the world. The War Industries Board died with the war. It has no history worthy of mention after November 11, 1918. Beyond the overlapping periods of price-control, it had no commitments and no involvements. To close its doors it had little to do but to complete its records. Within a week the commodity sections had dissolved, and quiet reigned in the rooms that had so long been the motor centers of the indus- APPRAISAL 487 try of a continent. Its business was to energize, accelerate, and order the material productive forces of the Nation for the ends of war. It operated on and through all the depart- ments and agencies of Government. Its powers were fed by what it did in the great emergency; its staflF was the whole of Government. It had no bureaucratic organization to unravel, no post- bellum entanglements to dissolve. Every department of Government that had participated in the greatest govern- mental activity of the age was, for all the Board's potency of direction, integral and intact. It used and swayed them all, but had not organically infused itself into them. Itself a loose federation, though functionally compacted by self- sacrifice and high endeavor, it had served as the federal bond of the statutory organisms of Government, but had not absorbed or weakened them. All the formal business of war administration was in its hands, and all the data and equipment to clear away the litter of war and deal with the multitudinous adjustments that had to be made between Government and industry. The magnificent war formation of American industry was dissipated in a day; the mobilization that had taken many months was succeeded by an instantaneous demobilization. For the War Trade Board, the Shipping Board, the Food Administration, and, to some extent, the Fuel Administration and other of the temporary agencies, there were problems and duties of time-consuming decontrol. The Council of National Defense, which had worked out of a morass of internal pessimism into doing effective things for the Nation, addressed itself to extensive economic research in questions of reconstruction and readjustment, notably with regard to the high cost of living, and, through its great field machinery, to matters of demobilization and reemployment of service men. The War Industries Board might have elected to remain for a long time on the plea of its necessity in a disordered world, but it judged that it was not geared or powered to go backward, and that American business was competent to resume without coddling and nursing the stubborn indepen- dence it was so loath to surrender. < ! i 488 INDUSTRIAL AMERICA IN THE WORLD WAR Yet, contemplating the vastness of its scope, the sound- ness of its methods, and the sagacity of its measures, one wonders whether some like controller of world economic forces might not have dealt as weU with reaction as the War Industries Board did with action. However that may be, we have the certam knowledge that in the War Industries Board American democracy superbly demonstrated its power to rise to great eniergencies m the Nation's business, just as the army and fleet reflected its military adaptability. The War Industries Board was a govemmentally sponsored committee of American industry fo administer industry in war. It was the American business man in action for a common end. Russia was torn to pieces by its soviet of proletarians; America was united by the protean forces of its managers and producers. THE END APPENDICES 1 1^ 4t 4 it ir « ! II \ ! » APPENDIX I SECTION 2 OF THE ARMY APPROPRIATION ACT, APPROVED AUGUST 29, 1916, CREATING THE COUNQL OF NATIONAL DEFENSE Sec. 2. That a Council of National Defense is hereby established for the coordination of industries and resources for the national security and welfare, to consist of the Secretary of War, the Secretary of the Navy, the Secretary o£ the Interior, the Secretary of Agriculture, the Secretary of Commerce, and the Secretary of Labor. That the Council of National Defense shall nominate to the President, and the President shall appoint, an advisory commission, consisting of not more than seven persons, each of whom shall have special knowledge of some industry, public utility, or the development of some natural resource, or be otherwise specially qualified, in the opinion of the council, for the performance of the duties hereinafter provided. The members of the advisory commission shall serve without compensation, but shall be allowed actual expenses of travel and subsistence when attending meetings of the commission or engaged in investigations pertaining to its activities. The advisory commission shall hold such meetings as shall be called by the council or be provided by the rulea and regulations adopted by the council for the conduct of its work. That it shall be the duty of the Council of National Defense to supervise and direct investigations and make recommendations to the President and the heads of executive departments as to the location of railroads with reference to the frontier of the United States, so as to render possible expeditious con- centration of troops and supplies to points of defense; the coordination of military, industrial, and commercial purposes in the location of extensive high- ways and branch lines of railroad; the utilization of waterways; the mobiliza- tion of military and naval resources for defense; the increase of domestic production of articles and materials essential to the support of armies and of the people during the interruption of foreign commerce; the development of seagoing transportation; data as to amounts, location, method, and means of production, and availability of military supplies; the giving of information to producers and manufacturers as to the class of supplies needed by the military and other services of the Government, the requirements relating thereto, and the creation of relations which will render possible in time of need the immediate concentration and utilization of the resources of the Nation. That the Council of National Defense shall adopt rules and regulations for the conduct of its work, which rules and regulations shall be subject to the approval of the President, and shall provide for the work of the advisory com- mission, to the end that the special knowledge of such commission may be developed by suitable investigation, research, and inquiry and made available in conference and report for the use of the council; and the council may organize subordinate bodies for its assistance in special investigations, either by the employment of experts or by the creation of committees of specially qualified persons to serve without compensation, but to direct the investigations of experts so employed. That the sum of |200,000, or so much thereof as may be necessary, is hereby appropriated, out of any money in the Treasury not otherwise appropriated. 1 ?f ': I #!| 1 \ i H I II 492 INDUSTRIAL AMERICA IN THE WORLD WAR to be immediately available for experimental work and investigations under- taken by the council, by the advisory commission, or subordinate bodies, for the employment of a director, expert and clerical expenses and supplies, and for the necessary expenses of members of the advisory commission or subordinate bodies going to and attending meetings of the commission or subordinate bodies. Reports shall be submitted by all subordinate bodies and by the advisory commission to the council, and from time to time the council shall report to the President or to the heads of executive departments upon special inquiries or subjects appropriate thereto, and an annual report to the Congress shall be submitted through the President, including as full a statement of the activities of the council and the agencies subordinate to it as is consistent with the public interest, including an itemized account of the expenditures made by the council or authorized by it, in as full detail as the public interest will permit: Provided, however. That when deemed proper the President may authorize, in amounts stipulated by him, unvouchered expenditures and report the gross sum so authorized not itemized. APPENDIX II THE OVERMAN ACT [Approved May 20, 1918.] ^^.J^li ^"*''°'!^°« **»? President to coordinate or consolidate executive bureaus, agencle. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled. That, for the national security and deJense, for the successful prosecution of the war, for the support and main- tenance of the Army and Navy, for the better utilization of resources and industries, and for the more eflFective exercise and more efficient administration toy the President of his powers as Commander in Chief of the land and naval forces, the President is hereby authorized to make such redistribution of Junctions among executive agencies as he may deem necessary, including any functions, duties, and powers hitherto by law conferred upon any executive department, commission, bureau, agency, office, or officer, in such manner as in his judgment shaU seem best fitted to carry out the purposes of this act and to this end is authorized to make such regulations and to issue such orders as he may deem necessary, which regulations and orders shall be in writing and shall be filed with the head of the department aflFected and constitute a public record: Provided, That this act shall remain in force during the con- tinuance of the present war and for six months after the termination of the war by the proclamation of the treaty of peace, or at such eariier time as the President may designate: Provided further. That the termination of this act shall not affect any act done or any right or obligation accruing or accrued pursuant to this act, and during the time that this act is in force: Provided further. That the authority by this act granted shall be exercised only in matters relating to the conduct of the present war. ; /f * ^:J^^^ ''?. ^f.^T'^^e «"' *h« purposes of this act the President is author- ized to utilize, coordinate, or consolidate any executive or administrative com- missions, bureaus, agencies, offices, or officers now existing by law, to transfer any duties or powers from one existing department, commission, bureau, agency, oftce, or officer to another, to transfer the personnel thereof or any part of it either by detail or assignment, together with the whole or any part of the records and public property belonging thereto. Sec. 3. That the President is further authorized to establish an executive agency which may exercise such jurisdiction and control over the production of aeroplanes, aeroplane engines, and aircraft equipment as in his judgment may be advantageous; and, further, to transfer to such agency, for its use, all or any moneys heretofore appropriated for the production of aeroplanes, aeroplane engines, and aircraft equipment. *- -» f ^ Sec. 4. That for the purpose of carrying out the provisions of this act, any moneys heretofore and hereafter appropriated for the use of any executive department, commission, bureau, agency office, or officer shall be expended only tor the purposes for which it was appropriated under the direction of such other agency as may be directed by the President hereunder to perform and execute said function. Sec. 5. That should the President, in redistributing the functions among the I » ' li ■ — . »-• — » »_ 41 f .t ! 4 I i ^1 494 INDUSTRIAL AMERICA IN THE WORLD WAR executive agencies as provided in this act, conclude that any bureau should be abolished and it or their duties and functions conferred upon some other department or bureau or eliminated entirely, he shall report his conclusions to Congress with such recommendations as he may deem proper. Sec. 6. That all laws or parts of laws conflicting with the provisions of this act are to the extent of such conflict suspended while this act is in force. Upon the termination of this act all executive or administrative agencies, departments, commissions, bureaus, offices, or officers shall exercise the same functions, duties, and powers as heretofore or as hereafter by law may be provided, any authorization of the President under this act to the contrary notwithstanding. APPENDIX III COMMITTEES UNDER AND COOPERATING WITH MR. BARUCH In his Capacity of Member of the Advisory Commission of the Council of National Defense The membership of these committees is given as of June 30, 1917. The list is taken from the First Annual Report of the Council of National Defense. cooperative committee on alcohol Horatio S. Rubens, director United States Industrial Alcohol Co., 27 William Street, New York City, chairman. Julius Kessler, president Distillers* Securities Corporation, 40 Exchanee Place, New York City. Carman N. Smith, secretary Michigan Chemical Co., Bay City, Mich. cooperative committee on aluminum Arthur V. Davis, president Aluminum Co. of America, Pittsburgh, Pa chairman. ** E. E. Allyne, president Aluminum Castings Co., Cleveland, Ohio Joseph A. Janney, Jr., Morris Building, Philadelphia, Pa., partner in Janney, Steinmetz & Co. cooperative committee on asbestos, magnesia, and roofing Thomas F. Manville, president H. W. Johns-ManviUe Co., New York City, chairman. Philip Allen, Bird & Son. cooperative committee on brass Charles F. Brooker, president American Brass Co., Ansonia. Conn., chairman. ^ E. 0. Goss, assistant treasurer ScoviU Manufacturing Co., Waterbury, Conn. UARTON Haselton, Secretary, treasurer, and general manager Rome Brass Co., Rome, N. Y. Lewis H. Jones, president Detroit Copper & Brass Co., Detroit, Mich. *. J. Kingsbury, president Bridgeport Brass Co., Bridgeport, Conn. cooperative committee on cement ^^ John E. Morron, president Atlas Portland Cement Co., New York Citj. B. F. Aftleck, president Universal Portland Cement Co., Chicago, lU. CtEOrge T. Cameron, president Santa Cruz Portland Cement Co.. San Francisco, Cal. * ?^i^^°*>r"^^* president Dixie Portland Cement Co., Chattanooga, Tenn. ^^ U)l. L. M. Young, vice president Lehigh Portland Cement Co., Allentown, R. J. Wig, Bureau of standards. ;* 11 V. . t iV i! m. 496 INDUSTRIAL AMERICA IN THE WORLD WAR COOPERATIVE COMMITTEE ON CHEMICALS Dr. Wm. H. Nichols, General Chemical Co., 25 Broad Street, New York City, chairman. Van H. Manning, Bureau of Mines, Washington, D. C, Ex officio. C. A. Richards, Department of Commerce, Washington, D. C, Ex officio. Dr. M. T. BoGERT, National Research Council, Washington, D. C, Ex officio. Maj. J. T. Crabb, United States Army, retired; assistant to chairman. J. D. C. Bradley, secretary. SUBCOMMITTEE ON ACIDS H. R. Grasselli, Grasselli Chemical Co., Cleveland, Ohio, chairman. Henry Howard, Merriman Chemical Co., Boston. SUBCOMMITTEE ON ALKALIS J. D. Pennock, Solvay Process Co., Syracuse, N. Y., chairman. T. N. Hicks, Niagara Alkali Co., Niagara Falls, N. Y. SUBCOMMITTEE ON ELECTROCHEMICALS John J. Riker, 19 Cedar Street, New York City. SUBCOMMITTEE ON FERTILIZERS Horace Bowker, 2 Rector Street, New York City, chairman. Charles H. MacDowell, president Armour Fertilizer Works, Chicago. Chas. G. Wilson, Virginia Iron, Coal & Coke Co., Richmond, Va. SUBCOMMITTEE ON MISCELLANEOUS CHEMICALS Edward Mallinckrodt, Jr., 2600 North Second Street, St. Louis, chairman. SUBCOMMITTEE ON COAL-TAR BY-PRODUCTS William H. Childs, president Barrett Co., 17 Battery Place, New York City, chairman. SUBCOMMITTEE ON PYRITES A. D. Ledoux, 15 William Street, New York City. SUBCOMMITTEE ON SULPHUR Henry Whiton, president Union Sulphur Co., chairman. COOPERATIVE committee ON COPPER J. D. Ryan, president Anaconda Copper Co., 42 Broadway, New York City, chairman. R. L. AcASSiz, president Calumet & Hecla Mining Co., 12 Ashburton Place, Boston, Mass. W. A. Clark, president United Verde Copper Co., 20 Exchange Place, New York City. MuRRY M. Guggenheim, 120 Broadway, New York City. James McLean, vice president Phelps-Dodge Co., 98 John Street, New York City. APPENDIX 497 Charles MacNeill, president Utah Copper Co., 25 Broad Street, New York City. Stephen Birch, vice president Kinnecott Mines Co., 120 Broadway, New York City. cooperative committee on lead Clinton H. Crane, president St. Joseph Lead Co., 61 Broadway, New York City, chairman. Fred Bradley, president Bunker Hill & Sullivan Mining & Concentrating Co., San Francisco, Cal. Ed. W. p. Brush, American Smelting and Refining Co., 120 Broadway, New York City. E. J. Cornish, vice president National Lead Co., Ill Broadway, New York City. Harry L. Day, Hercules Mining Co., Wallace, Idaho. F. Y. Robertson, vice president and general manager United States Metala Refining Co., 120 Broadway, New York City. cooperatu^ committee on lumber R. H. Downman, president National Lumber Manufacturers* Association, New Orleans, La., Munsey Building, Washington, D. C, chairman. D. O. Anderson, lumber manufacturer, Marion S. C. W. R. Brown, lumber and paper manufacturer, Berlin, N. H. W. E. Delaney, president Kentucky Lumber Co., Lexington, Ky. J. F. Gregory, logger and lumber manufacturer, Tacoma, Wash. George B. Lewis, lumber manufacturer, Holyoke, Mass. G. S. Long, manager Weyerhaeuser Timber Co., Tacoma, Wash. W. M. Ritter, president W. M. Ritter Lumber Co., Welch, W. Va. E. A. Selfridge, president Northwestern Redwood Co., San Francisco, Cal. W. H. Sullivan, manager Great Southern Lumber Co. C. H. Worcester, president C. H. Worcester Lumber Co., Chicago, 111. F. G. WiSNER, Eastman Gardiner Lumber Co., Laurel, Miss. E. T. Allen, manager Western Forestry and Conservation Association, Port- land, Oreg. R. S. Kellogg, National Lumber Manufacturers* Association, secretary. cooperative committee on mica L. W. KiNGSLEY, president Eugene Munsell & Co., 68 Church Street, New York City, chairman. W. Vance Brown, Asheville Mica Co., Biltmore, N. C. F. L. Watson, president Watson Bros., Boston, Mass. w cooperative committee on NICKEL Ambrose Monell, president International Nickel Co., 43 Exchange Place, New York City, chairman. cooperative committee on steel and steel products Elbert H. Gary, chairman United States Steel Corporation, 71 Broadway, New York City, chairman. James A. Farrell, president United States Steel Corporation, 71 Broadway, New York City, chairman. James A. Burden, president Burden Iron Co., Troy, N. Y. Alva C. Dinkey, vice president Midvale Steel & Ordnance Co., Philadel- phia, Pa. I ;l! ! f ii I 498 INDUSTRIAL AMERICA IN THE WORLD WAR Willis L. King, vice president Jones & Laughlin Steel Co., Pittsburgh, Pa. E. G. Grace, president Bethlehem Steel Co., Ill Broadway, New York City. Charles M. Schwab, chairman of board, Bethlehem Steel Co., Ill Broad- way, New York City. John A. Topping, chairman Republic Iron & Steel Co., 17 Battery Place New York City. * H. G. Dalton, Pickands, Mather & Co., Cleveland, Ohio. E. A. S. Clarke, president Lackawanna Steel Co., 2 Rector Street, New York City, Secretary. H. H. Cook, American Iron & Steel Institute, New York City, assistant secretary. SUBCOMMITTEE ON ALLOYS James A. Farrell, 71 Broadway, New York City, president United States Steel Corporation, chairman. E. A. S. Clarke, president Lackawanna Steel Co., New York City. E. G. Grace, president Bethlehem Steel Co., South Bethlehem, Pa. E. J. Lavino, E. J. Lavino Co., Philadelphia, Pa. A. A. Fowler, Rogers Brown & Co., New York City, secretary. subcommittee ON sheet steel W. S. Horner, president National Association of Sheet & Tin Plate Manu- facturing, Pittsburgh, Pa., chairman. Walter C. Carroll, American Sheet Tin Plate, Pittsburgh, Pa. Charles Hadley, Alan-Wood Iron & Steel Co., Philadelphia, Pa. subcommittee on pig tin John Hughes, assistant to president United States Steel Corporation, 71 Broadway, New York City, chairman. E. R. Crawford, president McKeesport Tin Plate Co., McKeesport, Pa. John A. Frye, general purchasing agent American Can Co., 120 Broadway. New York City. A. B. Hall, manager metal department National Lead Co., New York City. Theodore Pratt, assistant manager manufacturing department Standard Oil Co. of New York, New York City. subcommittee on steel distribution James A. Farrell, president United States Steel Co., 71 Broadway, New York City, chairman. E. A. S. Clarke, president Lackawanna Steel Co., New York City. John A. Topping, chairman Republic Iron & Steel Co., New York City. subcommittee on scrap iron Eli Joseph, of Joseph, Joseph & Bros., New York City, chairman. Samuel Deutsch, Ohio Iron & Metal Co., Chicago. Vernon Phillips, Perry, Buxton, Doane & Co., Philadelphia, Pa. Jos. Michaels, Hyman-Michaels Co., Chicago, 111. subcommittee of pig iron, iron ore, and lake transportation H. G. Dalton, Pickands-Mathers Co., Cleveland, Ohio, chairman. F. Billings, Todd Stambaugh Co., Qeveland, Ohio. H. CouLBY, Pittsburgh Steamship Co., Cleveland, Ohio. C T. Dyer, W. P. Snyder & Co., Pittsburgh, Pa. APPENDIX 499 Leonard Peckitt, president Empire Iron & Steel Co., Philadelphia, Pa. F. B. Richards, M. A. Hanna Co., Cleveland, Ohio. W. T. Sheppard, Rogers, Brown Co., Buffalo, N. Y. A. H. Woodward, Woodward Iron Co., Birmingham, Ala. Amasa S. Mather, Pickands-Mather Co., Cleveland, Ohio, secretary. subcommittee on tubular products James A. Campbell, president Youngstown Sheet & Tube Co., Youngstown, Ohio, chairman. Anson Mark, Mark Manufacturing Co., Chicago, 111. George Matheson, Jr., vice president Spang Chalfant & Co., Pittsburgh, Pa. W. H. Rowe, president Pittsburgh Steel Co., Pittsburgh, Pa. E. Worcester, vice president National Tube Co., Pittsburgh, Pa. subcommittee on tin plate J. I. Andrews, general manager sales American Sheet & Tin Plate Co., chairman. E. R. Crawford, president McKeesport Tin Plate Co., McKeesport, Pa. E. T. Weir, president Phillips Sheet & Tin Plate Co., Weirton, W. Va. subcommittee on wire rope Karl G. Roebling, general manager sales John A. Roebling's Sons Co., Trenton, N. J., chairman. John J. Brode^iick, president Broderick & Bascom Rope Co., St. Louis, Mo. Frank Baackes, vice president and general sales agent American Steel & Wire Co., Chicago, 111. subcommittee on wire products Frank Baackes, vice president and general sales agent American Steel & Wire Co., Chicago, 111. George A. Mason, manager of sales Jones & Laughlin Steel Co., Pitts- burgh, Pa. John C. Neale, vice president and general manager of sales Midvale, Cambria & Worth Bros. Cos., Philadelphia, Pa. J. E. Frederick, secretary Kokomo Steel & Wire Co., Kokomo, Ind. H. Sanborn Smith, vice president and general manager sales Gulf States Steel Co., Birmingham, Ala. subcommittee on cold rolled and cold drawn steel of the steel and steel products committee F. N. Beagle, president Union Drawn Steel Co., Beaver Falls, Pa., chairman. E. L. Parker, president Columbia Steel Shafting Co., Pittsburgh, Pa. Roland Gerry, assistant general sales manager Jones & Laughlin Steel Co., Pittsburgh, Pa. cooperative committee on oil A. C. Bedford, president Standard Oil Co., 26 Broadway, New York City, chairman. Pa. G. S. Davison, president Gulf Refining Co., Frick Building, Pittsburgh, i i >i. Hn \ 500 INDUSTRIAL AMERICA IN THE WORLD WAR E. L. DoHENY, president Mexican Petroleum Co., Los Angeles, Cal. E. C. LuFKiN, president Texas Co., Whitehall Building, New York City. John H. Markham, Jr., Daniels Building, Tulsa, Okla. H. F. Sinclair, president Sinclair Refining Co., Equitable Building, New York City. J. W. Van Dyke, president Atlantic Refining Co., 3144 Passyunk Avenue, Philadelphia, Pa. William Muir, president National Petroleum Association, Titusville, Pa. H. G. James, president Western Refiners* Association, Kansas City, Mo. Joseph F. Guffy, president Natural Gas Association of America, Pitts- burgh, Pa. John A. Moffatt, 26 Broadway, New York City, secretary. COOPERATIVE committee ON RUBBER H. Stuart Hotchkiss, president General Rubber Co., 1790 Broadway, New York City, chairman. Frederic C. Hood, Hood Rubber Co., Watertown, Mass. Arthur Marks, Bureau of Construction and Repair, Navy Department, Washington, D. C. cooperative committee on wool Jacob F. Brown, Brown & Adams, 269 Summer Street, Boston, Mass. H. E. Campbell, Flagstaff, Ariz. Joseph R. Grundy, Wm. H. Grundy, Bristol, Pa. F. J. Hagenbarth, president National Association Wool Growers, Salt Lake Gty, Utah. Sigmund Silberman, S. Silberman Sons; Chicago, 111. James M. Wilson, McKinley, Wyo. cooperative committee on zinc Edgar Palmer, president New Jersey Zinc Co., 55 Wall Street, New York City, chairman. Charles W. Baker, president, American Zinc, Lead & Smelting Co., 120 Broadway, New York City. A. P. Cobb, vice president New Jersey Zinc Corporation, 55 Wall Street, New York City. Sidney J. Jennings, vice president United States Smelting, Refining & Mining Co., 120 Broadway, New York City. Cornelius F. Kelley, vice president Anaconda Copper Co., 42 Broadway, New York City. N. Bruce MacKelvie, president Butte & Superior Copper Co., 25 Broad Street, New York City. Thomas F. Noon, president Illinois Zinc Co., Peru, 111. Charles T. Orr, president Bertha A. Mining Co., Webb City, Mo. APPENDIX IV THE WAR INDUSTRIES BOARD, WITH ITS MAIN DIVISIONS main divisions The Board: BERjifARD M. Baruch, Chairman (ex Alexander Legge, Vice Chairman Rear Admiral F. F. Fletcher, Navy. Maj. Gen. George W. Goethals, Army. Robert S. Brookings, Chairman Price- Fixing Committee. Hugh Frayne, Labor. Edwin B. Parker, Priorities Commis- sioner. George N. Peek, Commissioner of Fin- ished Products. officio member of all committees). J. Leonard Replogle, Steel Admin- istrator. L. L. Summers, Technical Advisor. Albert C. Ritchie, General Counsel. H. P. Ingels, Secretary. Herbert Bayard Swope, Associato Member. Clarence Dillon, Harrison Wil- liams, and Harold T. Clark, Assistants to the Chairman. Price-Fixing Committee: Robert S. Brookings, chairman. Members: B. M. Baruch, chairman War Industries Board; W. B. Colver, chairman Federal Trade Commission; Hugh Frayne, labor representative. War Industries Board; H. A. Garfield, Fuel Administrator; Commander John M. Hancock, Navy representative; Lieut. Col. Robert H. Montgomery, Army representative; Henry C. Stuart; Dr. F, W. Taussig, chairman Tariff Commission; W. W. Phelps, secretary. Labor Division. — Hugh Frayne, chairman. War Prison Labor and National Waste Reclamation Section, — Dr. E. Stagg Whitin, chairman executive committee. National Committee on Prisons and Prison Labor; W. J. Spillman, chief. Office of Farm Management, Department of Agriculture; Capt. H. L. Baldensperger, Reclamation Division, United States Army; Anthony Caminetti, United States Commissioner of Immigration Department of Labor; John J. Manning, secretary, union label trades depart ment, American Federation of Labor; Dr. Charles H. Winslow, assistant direc- tor of research. Federal Board for Vocational Education; Edwin F. Sweet, Assistant Secretary Department of Commerce; Lieut. J. B. Goldman, United States Navy; Maj. J. W. Riley, The Adjutant General's Office. Allied Purchasing Commission: Bernard M. Baruch, Robert S. Lovett, Robert S. Brookings. Business manager: Alex Legge, succeeded by James A. Carr; assistants: A. L. Bostwick, James C Leddy and F. E. Penick. Requirements Division: Alex Legge, chairman. Members: Lieut. CoL C. C. Bolton, General Staff; George M. Brill, Emergency Fleet representative; James A. Carr, representing the Allies; Col. George H. Estes, Army representative; James IngUs; C. H. MacDowell, chemicals; P. B. Noyes, Fuel Administrator's representative; Edwin 1 I : t ! M i| i'l i ' .1 \ 502 INDUSTRIAL AMERICA IN THE WORLD WAR B. Parker, priority; George N. Peek, finished products; Admiral C. J. Peoples, Navy representative; M. B. Pool, Red Cross representative; T. C. Powell, Rail- road Administrator's representative; J. Leonard Replogle, steel; A. W. Shaw, conservation; L. L. Summers, technical advisor. War Industries Board; Capt. M. N. Taylor, Navy representative; T. F. Whitmarsh, Food Administrator's representative; Maj, Seth Williams, Marine Corps representative; Pope Yeat- man, nonferrous metals; W. E. Guylee, executive secretary. Clearance Office — Requirements Division. — J. C. Musser, secretary; C. B. Hughes, assistant secretary. Finished Products Division: George N. Peek, commissioner of finished products; E. L. Crawford, assistant to commissioner; W. M. Ritter, assistant to commissioner, certifying officer; Walter Bobbins, assistant to commissioner. Friortties Division: Edwin B. Parker, priorities commissioner; Rhodes S. Baker, assistant pri- orities commissioner. Priorities Board. — Edwin B. Parker, priorities commissioner; Edward Cham- bers, director of traffic. United States Railroad Administration; Admiral F. F. Fletcher, United States Navy; Felix Frankfurter, labor representative; Gen. George W. Goethals, United States Army; Alex Legge, representative of Allied Purchasing Commission; P. F. Noyes, director of conservation, Fuel Adminis- tration; T. F. Whitmarsh, Food Administration; Charles R. Piez, vice president and general manager of the Emergency Fleet Corporation, representing the United States Shipping Board and Emergency Fleet Corporation; Clarence M. WooUey, member of the War Trade Board; H. G. Phillipps, secretary. Priorities committee. — Edwin B. Parker, priorities commissioner, chairman; Charles K. Foster, vice chairman. Members: George Armsby; H. H. Barbour; W. W. Chase; Percy Holbrook; J. M. Hopkins; Henry Krumb; F. H. Macpher- son; Rear Admiral N. E. Mason; Lieut. Col. C. A. McKenney; Everett Morss; Lucius P. Ordway; T. C. Powell; Rear Admiral A. V. Zane. Maurice Hirsch, secretary, and Marcus B. Hall, assistant secretary. Labor section^ priorities division. — A. W. Gapp, chief. Nonwar construction section, priorities division. — D. R. McLennan, chief. Conservation Divisions: A. W. Shaw, chairman; Charles K. Foster; Dr. E. F. Gay; Lieut. Col. W. R. Roberts; C. H. MacDowell; Admiral Samuel McGowan; George N. Peek; T. C Powell; Pope Yeatman; Melvin T. Copeland, executive secretary. Division of Planning and Statistics: Edwin F. Gay, chairman; Henry S. Dennison, assistant chairman; H. R. Hatfield, director; J. Lee Coulter, chief of commodity section; Wesley C. Mitchell, chief of price section; Mills E. Case, chief of contract section; Leo Wolman, editor of Commodity Bulletin; William A. Barber; Alice C. Boughton; Stuart Daggett; L. K. Frank; Paul Willard Garrett; Walter Holsinger; Walter W. Stewart. Employment Management Courses: James Inglis, chairman; P. E. Foerderer, vice chairman; Capt. Boyd Fisher, Government supervisor. (Operated under joint advisory committee of the APPENDIX 503 Army, Emergency Fleet Corporation, Labor Department, Navy, and War Industries Board.) Facilities Division: Samuel P. Bush, director; Capt. C. Bamberger; C. W. Carroll; M. F. Chase; F. L. Dame; Capt. W. B. Dickinson; J. L Downey; L. H. Kittredge; G. E. Miller; L. B. Reed; H. Williams. Division of Business Administration: John Esher Knobel, director and business manager; William E. Goodfellow, assistant business manager; Charles H. Birr, comptroller; W. G. Scott, dis- bursing officer; W. B. Martin, chief clerk; Charles J. Davis, assistant; L. Perry Ferguson, storekeeper; Mrs. Mary Newton, chief of bureau of personnel; H. L. Lambert, superintendent of buildings. commodity and miscellaneous divisions and sections Note. — Each division and section had as members authorized representatives of the Army and of the Navy and of other purchasing departments interested in the commodity. Agricultural implements and wood products. — E. E. Parsonage, chief; P. B. Schravesande, assistant. Automotive products section.— C. C. Hanch, chief; Edward J. Hickey, assistant. Brass section. — Everett Morss, chief. Building Materials Division.— Richard L. Humphrey, director. Assistants: W. A. R. Anthony; Morris C. Betts; A. L. Gladding; Norman H. Hill; Frank A. Kendall; C. M. Lyman; C. D. Morley; H. A. Schaffer; Edna M. Stangland; M. A. Styles; U. F. Turpin; F. W. Walker; Capt. George W. Riddle; Ira H. Woolson, advisory engineer. New York branch: George L. Lucas, in charge. Philadelphia branch: Herbert B. Allen, in charge. Norfolk branch: W. E. Law, in charge. Chain section.— John C. Schmidt, chief; Arthur E. Crockett, assistant. Chemicals Division.— Chai-les H. MacDowell, director. Abrasives.— See Electrodes and abrasives section, chemicals division. Acids and heavy chemicals section.— Albert R. Brunker, chief; Russell S. Hubbard, associate; A. E. Wells, associate. Alkali and chlorine section.— (Caustic soda, soda ash, chlorine and chlorine products, lime, potash, and salt.) H. G. Carrell, chief; Lieut. E. A. Williams, associate. Asbestos.— See Chemical glass and stoneware section, chemicals division. Chemical glass and stoneware section.— (Asbestos and magnesia included.) Robert M. Torrence, chief. Coal-gas products section.— (Toluol, benzol, xylol, phenol, solvent naptha, road oil, asphaltum, acetylene, nitrogen, calcium carbide, rare gases, saccharin, i\\^^^^' t" ^"^ys^"' including commandeering and allocation of toluol.) J. M. Morehead, chief; Ira C. Darling, associate toluol distribution. Creosote section.— Ira C. Darling, chief. Dye section (synthetic dyes and intermediate section).— Dt. Victor L. Kinir. chief; Dr. J. F. Schoellkopf, jr., chief, resigned. Electric furnaces, electrolysis, electrometallurgy.— See technical and con- sulting section, chemicals division. ■ w an. i* 4 ■'t 1 tl I 1,1 504 INDUSTRIAL AMERICA IN THE WORLD WAR Electrodes and abrasives section. — Capt. Henry C. Du Bois, chief. Ethyl alcohol section. — William G. Woolfolk, chief; A. E. Wells, associate. Ferroalloys section. — (Chrome, manganese, and tungsten ores and ferro- alloys, such as ferro chrome, manganese, vanadium, titanium, silicon, and tungsten; also spiegeleisen, manganesite, and zirconium.) Hugh W. Sanford, chief; C. D. Tripp, associate. Fine chemicals section. — (Miscellaneous analytical, photographic, and phar- maceutical chemicals, etc.) A. G. Rosengarten, chief. Fire brick, chrome brick, etc. — See Refractories section, chemicals division. Magnesia. — See Chemical glass and stoneware section, chemicals division. Magnesite. — See Ferroalloys section. Mica section. — C. K. Leith, chief. Nitrate section. — Cliarles H. MacDowell, chief; J. A. Becker, associate; H. Ray Paige. Paint and pigment section, — L. R. Atwood, chief; Russell S. Hubbard, chief, deceased. Platinum section. — (Platinum, palladium, iridium.) C H. Conner, chief; R. H. Carleton, associate; G. £. DeNike, associate. Refractories section, — (Fire brick, chrome brick, etc.) Charles Catlett, chief. Sulphur and pyrites section. — William G. Woolfolk, chief; A. E. Wells, associate; J. R. Townsend, associate. Tanning material and vegetable dye section. — (Including inedible oils, fats, and waxes.) E. J. Haley, chief; E. A. Prosser, associate; Harold G. Wood, associate. Technical and consulting section. — Dr. Herbert R. Moody, associate; Dr. E. R. Weidlein, associate; Dr. T. P. McCutcheon, associate. Toluol, — See Coal-gas products section, chemicals division. Wood chemical section. — (Including methyl alcohol, methyl acetone, ace- tone, ethyl methyl ketone, acetate of lime, acetic acid, acetic anhydride, formal- dehyde, aspirin, methyl acetate, etc) C. H. Conner, chief; A. H. Smith, associate; R. D. Walker, associate. Statistics, chemicals section — Joint office on chemical statistics, — Capt. Willis B. Rice, associate; Lieut M. R. Gordon, associate; Asst. Paymaster Dunning, associate; Arthur Minnick, associate. Conversion of industry. — See Resources and conversion section. Copper tubing — See Brass section — Nonferrous tubing. Cotton and cotton linters section. — See Textile division. Crane section. — A. C. Brown, chief; (^pt. C E. Stamp, assistant chief; Louis P. Lipps. Electrical and power equipment section. — Walter Bobbins, chief; L. W. Grothaus, John H. Waterman, Allen P. Bender, Max Greenburg, Merritt M. Hughes, Wm. S. James, Thos. S. Knight, Edward R. Welles, J. A. Merwin. Electric wire and cable section. — ^Le Roy Qark, chief. Emergency construction committee. — Col. W. A. Starrett, chairman; Maj. Qair Foster; John Donlin, American Federation of Labor; Lieut. J. B. Tal- madge, secretary. Explosives Division.— M. F. Chase, director. Felt section. — See Textile division. Fiber. — See Jute, hemp, and cordage section. Fire prevention section.— W. H. Merrill, chief; Charles H. Smith, associate chief of section; George W. Booth, associate chief of section; Frank Pierce, Wilbur Mallalieu. APPENDIX 505 Flax products section. — See Textile division. Forgings, guns, small arms, and small arm ammunition. — Samuel P. Bush, chief; Capt. Clarence Bamberger; Charles W. Carroll. Gold and silver section. — C. H. Conner, chief. Hardware and hand tool section. — Murray Sargent, chief; Lawrence J. Stoddard, gauges; Thomas F. Bailey, mill supplies; Alfred L. Lincoln, drills and reamers; E. W. Lively, machinists* precision tools; L. H. Wetherell, cutlery, needles, sewing machines. Hide, Leather and Leather Goods Division. — C. F. C. Stout, director. Section chiefs. — Thomas Cover, jr., in charge of sole leather; O. C. Howe, in charge of foreign skins and hides; L. B. Jackson, in charge of domestic skins and hides; F. A. Vogel, in charge of upper leather; R. M. Pindell, jr., executive secretary. Chiefs of bureaus. — C. D. P. Hamilton, shoe manufacturers; Charles J. Cliisholm, shoe retailers; George Rowbotham, belting; Charles A. Rogers, harness and personal equipment, except shoes and clothing; Harry J. Louis, gloves. Assistants. — Robert D. Ware, belting bureau; George R. Wheeler, shoe manufacturing bureau; Thomas W. Hughes, assistant to executive secretary. Inland traffic section. — Thomas C. Powell, chief; Henry F. Bell, assistant. Jute, hemp, and cordage section. — E. C. Heidrich, jr., chief. Legal section.— U. M. Channing, chief; W. C. Saeger; E. M. Dodd, jr.; H. R. Gower. Linters and cotton goods section. — See Textile division. Lumber section. — Charles Edgar, director; Maj. Armistead M. Cooke, assistant. Machine tool section. — G. E. Merryweather, chief; Alvin B. Einig; Arthur J. M. Baker; Roland. Houck; Ernest D. Crockett; Floyd C. Lowell; Walter L. Ditforth. Medical section. — Lieut. Col. F. F. Simpson, chief; David L. Kean, hospital furniture and equipment, surgical instruments; A. G. Rosengarten, medicinal chemicals. Mica section. — See Chemicals division. Miscellaneous commodities section. — M. B. Foster, chief. (This section handles all commodities for which we have no specially established commodity section.) Nonferrous metals section. — (Antimony, aluminum, copper, lead, nickel, quicksilver, zinc.) Pope Yeatman, chief; E. C. Thurston, assistant; Andrew Walz, assistant; I. H. Cornell, lead and zinc. Nonferrous tubing section. — See Brass section. Optical glass and instruments section. — G. E. Chatillon, chief; Maj. F. E. Wright; Lieut. Commander H. A. Orr. Power section.— Frederick Darlington, chief; Charles B. Da\'is, business assistant; Maj. Charles F. Lacombe; Maj. George S. Sever; Maj. Malcolm MacLaren; Capt. Carroll Shaw; Capt. Ashton M. Tinsley; Capt. John C. Damon; Lieut. George K. Miltenburger; Lieut. William W. Stanley. Production division. — See Special advisory committee on plants and munitions. Pulp and Paper Division.— Thomas E. Donnelley, director. Newspaper section. — G. J. Palmer, chief. Paper economies section, — I.* W. Blanchard, chief. ' \ ijffl i !l| I )' »• r ! S^ I ) i :«, '. 506 INDUSTRIAL AMERICA IN THE WORLD WAR Manufacturing section. — S. L. WillsoTi, chief. Fiber board and container section.— Harold W. Nichols, chief. Railway equipment and supplies section.— J. Rogers Flannery, cl^i^f. Resources and conversion section.— Charles A. Otis, chief; John A. Kling, assistant chief; Charles H. Anthony; Edward F. Bulmahn; W. T. Rossiter; Irving H. Taylor. Rubber section.—See Textile division. Shipping — Mineral imports and exports.— C. K. Leith. Small arms and small-arms ammunition.— See Forgings, guns, etc., section. Small tools. — See Hardware and hand-tool section. Special advisory committee on plants and munitions.— S. M. Vauclam, chairman; Capt. C. K. Rockwell, J. M. Hansen, Henry R. Rea, Frank W. Morse, E. F. Wood, Admiral A. R. Couden, G. M. Shaw. Steel Division.— J. Leonard Replogle, director of steel supply; Frank Pumell, assistant director; E. D. GraflF, special agent. Steel products section.— F. E. Thompson, chief; G. M. Hartley, cars and locomotives; D. A. Holloran, emergency fleet; J. A. McDonald mill expert; D. F. Mann, wire products; R. I. Richardson, chief clerk; G. C. Shidle, tubes; C. G. Thomas, sheets; H. H. Weaver, mill schedules. r. n f Projectile steel, rails, alloy steel, and cold-drawn steel section.— Capt. U. t.. Sawyer, chief; John W. Horr, assistant, alloy steel and cold-drawn steel; R. L. Lovell, assistant, projectile steel; F. A. Weymouth, assistant, rails. Pig iron section.— J&y C. McLauchlan, chief; J. W. Dickson, S. R. Leonard, L. R. Smith, B. S. Stephenson, L. W. Williams. Permit section.— i. S. Barclay, chief; G. H. Pyne, assistant. Bureau of warehouse distribution.— Andieyf Wheeler, chief; Fhilo B. Rhoades, assistant; Austin D. Smith, assistant. Iron and steel scrap secriore.— William Vernon Phillips, chief. Statistics.— Fercy K. Withey, chief; Ernest L. Selden, assistant. Stored materials section.— i. F. Wilkins, chief. Textile Division.— John W. Scott, director; Henry B. Ashton, assistant. Cotton and cotton linters section.— George R. James, chief; George W. Naumburg, assistant; Sherboume Prescott, assistant. Cotton goods section.— Svencer Turner, chief; Grosvenor Ely, assistant; George F. Smith, thread; Burton Etherington, yarn; Ralph E. Loper, mill equipment and production. Felt section. — Sylvan Stroock, chief. Flax products section. — George F. Smith, chief. Knit goods section.— Lincoln Cromwell, chief; Rufus W. Scott, associate; F. E. Haight, associate; John McCauley, associate. Rubber and rubber goods section.— H. T. Dunn, chief. SUk section.- William Skinner, chief. ^ ,, rr „ DomestU wool section.— Ley/is Penwell, chief; William D. McKellar, assistant. Foreign wool section. — A. M. Patterson, chief. fToolens section.— Herhen E. Peabody, chief; A. L. Gifford, assistant Yarn section.— See Cotton goods section. Tin section.— George N. Armsby, chief; James W. Hitchcock, assistant; Lincoln Hutchinson, assistant; Thomas G. Cranwell, assistant. Tobacco section.— A. I. Esberg, chief. Wire and Cable.—See Electric wire and cable section. APPENDIX 507 Wood products. — See Agricultural implements, etc., section. Woolens section. — See Textile division. Wool section. — See Textile division. Yarn section. — See Textile division, cotton goods section. News section. Committee on Public Information. — Stanley M. Reynolds, A. 0. Hayward. lil if I II I I i ii t i< APPENDIX V REGIONAL ADVISORS Region No. I. Boston Mass. No. 2, Bridgeport, Conn. . . No. S, New York, N. Y. . . No. 4, Philadelphia, Pa. . . . No. 5, Pittsburgh, Pa. . . . . No. 6, Rochester, N. Y. . . . No. 7, Cleveland, Ohio. . . . No. 8, Detroit. Mich No. 9, Chicago, III No. 10, Cincinnati, Ohio . . No. II, Baltimore, Md. . . . No. 12. Atlanta. Ga. No. IS, Birmingham, Ala. . No. 14, Kansas City, Mo. . No. 15, St. Louis, Mo No. 16, St. Paul, Minn. . . . No. 17, Milwaukee, Wis. . . No. 18, Dallas, Tex No. 19, San Francisco, Calif. No. 20, Seattle, Wash No. 21, Denver, Colo Regional advisor — Address Stuart W. Webb, care of chamber of commerce. B. D. Pierce, jr., care of chamber of commerce. Wm. Fellowes Morgan, care of Merchants' Asso- ciation of New York. Ernest T. Trigg, 1228 Widener Building. George S. Oliver, care of chamber of commerce. E. A Fletcher, care of chamber of commerce. W. B. McAllister, care of chamber of commerce. Alkm A. Templeton, care chamber of commerce. D. E. Felt, 29 South La Salle Street. Edwin C. Gibbs, SI East Fourth Street. F. S. Chavannes, care Mer- chants & Manufacturers Association. Edward H. Inman, care of chamber of commerce. T. H. Aldrich, 822 Brown- Marx Building. Franklm D. Crabbs, Tenth and Central Streets. Jackson Johnson, care of chamber of commerce. D. R. Cotton, 1414 Pioneer Building. August H. Vogel, fourth floor, city hall. Louis Lipsitz,407-9 South- land Life Building. Frederick J. Koster, care of chamber of commerre Herbert Witherspoon, care of chamber of commerce. Cass E. Herrington, 510 Symes Building. Territory Maine, New Ham^hire, Vermont, eastern Massachusetts, Rhode Island. ^ Western Massachusetts, Connecticut. Nine southeastern counties of New York, Long Island, and northern New Jersey. Eastern Pennsylvania, southern New Jersey, Delaware. _ Western Pennsylvania, except Erie, Craw- ford, and Mercer Counties; Jefferson and Belmont Counties of Ohio; Allegany, Garrett, and Washington Counties of Maryland; West Virginia. New York State, except Metropolitan dis- trict. New York City. Erie, Crawford, and Mercer Counties of Pennsylvania; northern Ohio, excepting Jefferson and Belmont Counties. Southern Michigan. lowa,^ northern Illinob, and northern Indiana. Southern Qhio, southern Indiana, and Kentucky. Eastern Maryland, Virginia. North Carolina, South Carolina, Georgia and Florida, excepting western tier of counties. Tennessee, Mississippi, Alabama, western tier of counties in Florida, and southern Louisiana. Utah, Wyoming, Colorado, northern New Mexico, northern Oklahoma, Kansas, Nebraska, and western strip of Missouri. Missouri, Arkansas, and southern Illinois. Montana, North Dakota, South Dakota, Minnesota, and northwestern Michigan. Southern Wisconsin. Texas, northern Louisiana, southeastern Oklahoma, southern New Mexico, and southeastern Arizona. California, Nevada, and Arizona, except southeastern counties in Dallas district. Washington, Oregon, and Idaho. Colorado, Utah, Wyoming, and northern New Mexico. APPENDIX VI MEMBERS OF THE WAR INDUSTRIES BOARD ORGANIZATION Name Abbott, Arthur J. AbeU, Chas.S.... Adler, H.S Aldrich, Lieut. H. R. . Aldrich, H.W Aldrich, Truman H.. . . Alexander, Maurice M. Allen, Herbert B Alsberg, Dr. Carl L. . . . Anderson, Chandler P. , Anthony, Charles H. . . Anthony, Wm. A. R. . Archer, Maj. P. F. . . . Armsby, George N. . . . Ashton, Henry B Atwood, Lewis R , Averill, William A . . . , Aycock, Thomas J Baggott, Capt. John C. . . Bailey, Thomas F. Baker, A. J Baker, Rhodes S. Baldensperger, Capt. H. L. Bamberger, Capt. C Barber, William A Barbour, Henry H. Barclay, James S Barlow, De Witt D , Barnes, M. H Barnum, Harris W. Position in War Industries Board Chief, questionnaire section Assistant section chief, priorities divbion. Secretary of special representa- tive of United States Railroad Administration with War In- dustries Board. Nonf errous metals section Staff, lumber section . Regional advisor, Birmingham, Ala. Assistant in platinum section . . . In charge Philadelphia branch building material division. Advisory board on medicinal agents, section of medical in- dustry. Special counsel on international affairs. Staff, resources and conversion section. Assistant to chief, building mate- rial division. Requirements representative, Marine Corps.^ Member priorities committee, chief in charge of tin. Assistant to director, textile divi- sion. Chief, paint and pigment section Expert, division of planning and statistics. Lumber^ production director, Georgia and Florida. Examiner, Army section, priori- ties committee. Assistant to chief, hardware and hand-tool section. Assistant, machine-tool section Assistant priorities commissioner Member war prison labor and national waste reclamation section. Assistant chief, forgings, guns, etc., section. Expert, price statistics Member priorities committee . . , Chief, permit section, steel divi- sion. Associate chief, dredging section Assistant machine tool section . . Gold and silver^ section of the chemical division. Former business Member law firm, Evans, Abbott ft Pearce, Los Angeles, Calif. Baltimore, Md. Secretary to vice president. Southern Ry. Co., Cincinnati, Ohio. Chief of field party and petrographer, Wisconsin Geographical Survey, Melrose, Mass. Sales manager, Hammond Lumber Co., Mill City, Oreg. Mining engineer for aty of Birming- ham, Ala. In charge of customers* rooni, John L. Dunlop & Co., Louisville, Ky. Secretary, Eastern Stone Producers* Association, Philadelphia, Pa. Chief Bureau of Chemistry, Depart- ment of Agriculture. Law firm, Anderson & Anderson, New York, N. Y. Export salesman, Detroit, Mich. Assistant to secretary. Master Build- ders Association, Boston, Mass. Washington, D. C. Vice president, California Packing Corporation, San Francisco, Cam. Credit mana^r, Carson, Pirie, Scott & Co., Chicago, 111. President, Peaslee-Gaulbert Co.. Louisville, Ky. Inspector in elementary education. State Education Department, Al- bany, N. Y. General manager, the Aycock Lum- ber Co., Aycock, Fla. Purchasing agent and factory mana- ager, McCormick Manufacturing Co., Dayton, Ohio. Manager and treasurer. Banks Sup- ply Co., Huntington, W. Va. Moseler Safe Co., Hamilton. Ohio. Law firm, Thompson, Knight, Baker & Harris, Dallas, Tex. Reclamation division, U. S. Army. Mining engineer. Salt Lake Cibr, UUh. Professor of commercial education* New York University. Manager of sales, Lackawanna Steel Co., New York, N. Y. Trustee of an estate, New York. N. Y. , Vice president and general manager, Atlantic, Gulf & Pacific Co., New York, N. Y. Henry Prentice Co., New York, N.Y. Manager, Washington branch office* National Fireproofing Co. / V ! ^•1 lUi I 510 INDUSTRIAL AMERICA IN THE WORLD WAR MEMBERS OF THE WAR INDUSTRIES BOARD ORGANIZATION Continued Name Barsh. Waldo A... Hartley, George M. Baruch, Bernard M. Bates, Frederic G. . . Bates, Henry M. Bayliss, Wm. G., BeaU James H... Bean. Charles A. Beatty, William T. Becker, John A. . Bell, Henry F... Bender, Allan P. Bender, Maj. John L. . Bergen. Charles Wm. . Betts, Morris C. Bickford, Robert S. Bingham, Harry P. Birr, CharfesH Blanchard, Isaac H. Blankenship, Lieut. J. M. Bolt, Edward J Bolton. Lieut. CoL C. C. . Boniface, Addison O. Boom, Eugene C. . Booth, George W. Bostwick, A. L. . . . Boughton, Alice B. Bowler. Marian . . . Boyd, Henry W... Brand. Charles J. . , Brayton, Edward. . BriU, Geo. M Brooker. Hubert H. Position in War Industries Board Secretary to director of chemicals Expert, steel division Chairman of the Board Staff, central bureau of planning and statistics. ....do Elxpert, fire prevention section . . Member advisory committee on medicinal agents, section of medical industry. Statistician, division of planning and statistics. Staff, conservation division. Assistant chief, nitrates section, chemical division. A:>sbtant to chief, inland traffic section. Expert, electric and power equip- ment section. Assistant in charge. Army sec- tion priorities committee. Expert, electric and power equipment division. Assistant to director, building materials section. Auditor, domestic wool section . . Secretary War Industries Board, Aug. 1, 1917-Jan 1, 1918. Comptroller, division of business administration. Chief, paper economics section, pulp and paper division. Naval assistant Assistant to chief clerk, facilities division. Secretary and a ssistant to chair- man. General Munitions Board, and chairman of clear- ance committee. Expert fire prevention section . . Examiner, priorities division . . . , Associate cmef, fire prevention section. Member purchasing commission Expert, price statistics, division planning and statistics. Research assistant, divbion planning and statistics. Expert, leather division, mem- ber foreign mission. Chairman committee on cotton distribution. Expert, cotton goods section . . . . Requirements division, emer- gency fleet representative. Secretary, foreign mission Former business Private secretary, C. H. MacDowell, Armour & Co., Chicago, 111. Assistant sales manager, Cleveland Steel Co., Cleveland, Ohio New York, N. Y. Partner, Bates & Gamble, Toledo, Ohio. Dean of law school. University of Michigan. _ » Engineer, Ohio Inspection Bureau, Columbus, Ohio. Director of pharmacy research. Uni- versity of Illinois. Salesman and office manager, Merrill Oldham & Co., bankers, Boston, Mass. President and general manager, Au tin Manufacturing Co., Chi- cago. 111. Traveling auditor. Armour Fertilizer Works, Chioigo, 111. General agent in Cuba Southern Ry. Co. Commercial engineer, Westinghouse Electric and Manufacturing Co., East Pittsburgh, Pa. President and general manager, Al- toona Overland Co., Altoona, Pa. New York representatives of the Ford & Kendig Co , Philadelphia, Coffin Valve Co., Boston, et. al. Architect, office of Public Roads, Washington, D. C. Broker, Boston, Mass. Cleveland, Ohio. C. P. A. SUff of Baker, Vawter & Wolf, Chicago. 111. President Isaac H. Blanchard Co., New York, N. Y. Washington, D. C. Sales manager. Twentieth Century Publishing Co., Philadelphia, Pa. Secretary Bourne Fuller Co., Cleve- land, Ohio. Superintendent of inspections. Un- derwriters Laboratories, Chicago, lU. Attorney at law, San Francisco, Calif. Chief engineer, National Board of Fire Underwriters. New York, N. Y. Secretary Planning Commission of St. Louis, Mo. Research expert, Home Economics, Bureau of Educational Elxperi- ments. Instructor of French, Dedham, Mass. President Armour Leather Co., Chicago. 111. Chief, Bureau of Markets, Depart- ment of Agriculture. Treasurer and cotton buyer, Towne, Brayton & Osborn, Fall River, 140 North Broad Street, Philadelphia. Pa. International Harvester Co.. Chi- cago, 111. APPENDIX 511 MEMBERS OF THE WAR INDUSTRIES BOARD ORGANIZATION Continued Name Brookings, Robert S. Brown, Alexander C. Brown, George S. Bruning, H. F Brunker, Albert R. . Bryan, Allen W. . . Bryar, W. B Buel, Hillhouse . . . Bulkley, Robert J. Bullard, Percy ... Bulmahn, E. F Burgess, William. . Burke, John H., jr.. Burrowes, John F Burwell, William R.. Bush, Samuel P. . . . . Butz, Theodore C Gallery, John B , Caminnetti, Anthony . Campbell, John James Canaday, Ward M. . . . Carleton, R. H. . . . Carmalt, James W. Carpenter. Gilbert E. Carr, James A Carrell, Horace G. CarroU, Chas. Wm. Case, Mills E... Catlett, Charles. Chamberlam, W. £. Chambers, Edward. Position in War Industries Board Chairman, price fixing committee Chief, crane section, assistant to commissioner of finished prod- ucts. Expert, cotton goods section Former business Staff, conservation division Chief .acids and heavy chemicals section. Statistician, division of planning and statistics. Expert, hardware and hand tool section. Expert, division of planning and statistics. Chief, legal section Expert, nonwar construction sec- tion. Member resources and conver- sion section. Expert, hardware and hand tool section. Reporter Expert, facilities division . Division of planning and statis- tics. Director, facilities division, chief of the forgings. guns, etc., sec- tion. Examiner, priorities division . . . . Assistant, resources and conver- sion section. Member of war prison labor and national waste reclamation section. Nonf errous metals Expert, nonwar construction section. Associate chief, platinum section Staff, central bureau of statistics Expert, manufacturing section, pulp and paper division. Business manager, purchasing commission. Chief, alkali and chlorine section Staff, facilities division. Chief, contract section, division planning and statistics. Chief, refractories section Lumber section. Priorities board. United States Railroad Administratioo rep- resentative. President Washington University, St. Ix>uis, Mo. President Brown Hoisting Machinery Co., Cleveland. Ohio. Cost and Production Accountant, Ashland Cotton Co., Jewett City, Conn. 10«9 Myrtle Street, Oakland, Calif. President Liquid Carbonic Co., Chicago, 111., and Atlantic Steel Casting Co., Chester, Pa. Special Assistant Committeeon Pub- lic Information. Washington, D.C. General manager Ba'ley-Farrel Man- ufacturing Co., Pittsburgh, Pa. Lawyer, Seattle, Wash. Law firm, Bulkley, Hauxhurst, Saeger & Jamieson, Cleveland. Ohio. Filor, BuUard & Smith. New York, N.Y. Vice president David G. Fisher & Co., Davenport, Iowa. First vice president, U. S. Potters' Association, Trenton, N. J., and East Liverpool, Ohio. Court Reporter, Kalamazoo, Mich. Architect and Engineer, John I. Downey (Inc.), New York, N. Y. Brown University, Providence, R, I. President, Buckeye Steel Castings Co.. Columbus, Ohio. Lackner & Butz, Mortgage Invest- ments, Chicago, 111. Vice president, Duquesne Fruit Co.. Charter Oak, Cafif. Commissioner of Immigration, De- partment of Labor. Morris Heights, New York, N. Y. Advertising manager, Willys-Over- land Co., Toledo, Ohio. Member of firm. Blodgett & Co., bond dealers. New York, N. Y. Chief examiner. Interstate Com- merce Commission, Washington. Director and sales manager. Car- penter Paper Co., Omaha, Neb. President, American Seeding Ma- chine Co., Richmond, Ind., and Springfield, Ohio. Manager, technical service depart- ment, Solvay Process Co., Syra- cuse, N. Y. I President and general manager. Twentieth Century PublishingCo., Philadelphia, Pa. , Statistician, New York City. I Economic geolo^^t and chemist; ex- aminer of mineral properties, resi- dence Staunton, Va. John M. Woods Lumber Co., East Cambridge, Mass. Assistant Director General United States Railroad Administration. Washington, D. C. i \)l 512 INDUSTRIAL AMERICA IN THE WORLD WAR MEMBERS OF THE WAR INDUSTRIES BOARD ORGANIZATION Continued Name Channing, Henry M. . Chapin, Edward F., jr. Chappelear, Edgar S. . Charlton, Earfc P Chase, March F Chase, "Wendell W.. ChatUlon, George £. Chavannes, Frank S. Chisholm, Charles K. Clapp, A. W Ckpp, Henry H Clark, Arthur W Clark. Harold T. Clark, Le Roy... Clark, Mancel T. Clayton, Wm.L.. Clos. JeanH Cobb, J. P Coflin, JohnN... Collins. Walter G... Colver, W. B Comstodc, Louis K. Conner, Charles H. . Cook, Howard H.. Cooke, Maj. A. M. Coert. purchasing committee . . Assistant, machine tool section . . Assistant to director, building and nuiterials division. Expert, fire prevention section . . Secretary priorities committee . Assistant to chief, tin section . . Expert, fire prevention section . Member priorities committee. Expert, steel division Organization expert Member priorities committee . . Assistant, conservation division Former business Electrical engineer. Los Angeles Gas & Electrical Co., Los Angeles, Cal. President, Western Motor Car Co., Cincinnati, Ohio. 45 Kenwood Avenue, Rochester, N. Y. Hallowell, Jones & Donald, Boston, Mass. Judge Advocate General's Office, Navy Department. Professor of accounting, and dean. University of California. Sales manager and purchasing agent, Gaw O'Hara Envelope Co., Chi- cago, 111. -n, - -n -D Division freight agent, Erie R. R. Co., New York, N. Y. Inspector, Associated Factory Mu- tual Fire Insurance Co., Boston, Mass. T» -1 » Organization manager. Retail Re- search Association, New York, N.Y. „ „ . In charge New York office Stone & Webster, 120 Broadway, New York. N. Y. . ^ President. American Dredging Co., Philadelphia, Pa. Member of firm, Heacock & Hokab- son, Philadelphia, Pa. Mechanical engineer, American Blower Co., Detroit, Mich. Vice president and manager, Peoria Cordage Co., Peoria, 1 11. Wool merchant, Philadelphia, Pa. National Acme Co., Cleveland, Ohio. Editor, Official Bulletin, University of Minnesota. Circulation manager. Boot & Shoe Recorder, Boston, Mass. Editor Official Bulletin, University of Minnesota. Attorney, Denver, Colo. Assistant clerk. Committee on Mili- tary Affairs, United States Senate. Assistant manager. Proctor & Gam- ble, Cincinnati, Ohio. Whitcomb-Blaisdell Co., Worcester Mass. Graham & Hill, Indianapolis, Ind. Vice president. What Cheer Mutual Fire Insurance Co., Providence, R.L Attorney at law, Houston. Tex. General manager. I. Sulzbacher Co., Steubenville. Ohio. Secretary-treasurer. National Auto- matic Sprinkler Association. New York, N. Y. Vice president, the Rail Joint Co., New York, N. Y. Clerk, sales department. La Belle Iron Works, Steubenville, Ohio. Attorney, Minneapolis, Minn. Chairman of board, Camol Co., Chicago, 111. Managing partner. Swallow & Hop- kins, lumber manufacturers, Du- luth,Minn. » I i 518 INDUSTRIAL AMERICA IN THE WORLD WAR MEMBERS OF THE WAR INDUSTRIES BOARD ORGANIZATION Conitnued Name Horr, John W. Houdc, Lieut. Roland J. . Hough, Geo. A., jr Howe, Owen C Howell. Frank B. Hubbard. G. M.. Hubbard. Russell S.^ . Hughes, Claire B , Hughes, John Hughes, M. M Hughes, Morgan O. . . . Hughes, Thomas W.. . , Humphrey, Richard L. , Hunter, Lois B Hutchinson, Lincohi. . . . Huyck. E. N Ingels. Howard P. Inglis, James Inman. Edw. H Jackson, Edwin E., jr., Jaduon, Lewis B James, A. E James. Geo. R. James, Wm. S Jenkins, Frederick W. Jensen. A. G Johnson, Alvin S Johnson. Brig. Gen. Hugh S. Johnson, Jackson , Jones. Edw. D , Jones. Eliot . . Jones. John D. Position in War Industries Board Expert, steel division A ssistant, machine tool section. . Assistant to H. B. Swope Chief, foreign skins and hides section. Assistant to director, building materials division. Assistant to secretary, priorities committee. Deceased, former chief of paint and pigment section. Assistant secretary, clearance committee. Foreign mission Expert, electric and power equip- ment section. Wool section Hide, leather, and tanning sec- tion. Director, building materials divi- sion.^ Committee on comfort and wel- fare. Foreign mission Expert, felt section Secretary. War Industrial Board Member requirements division. . Regional advisor. Atlanta Special representative, finbhed products division. Chief, domestic skins and hides . Statistician, division planning and statistics. Chief, cotton and cotton linters section. Expert, electrical and power equipment section. Stan, division planning and sta- tistics. Secretary to G. N. Peek Special agent, division planning and statistics. Member War Industries Board, Army representative. Regional advisor, St. Louis .... Director of course materials, em- ployment management courses. Staff, cntral bureau planning and statistics. Executive secretary, war prison labor and national waste recla- mation section. Former business Assistant district manager, Bethle> hem Steel Co., Boston. Mass. Motch & Merryweather Machinery Co., Cleveland, Ohio. Writer. New York World. Partner, Sands & Lockie, Boston, Mass. American Radiator Co., New York, N.Y. Sales manager. Howe, Snow, Corri- gan & Bertles, investment bankers. Grand Rapids, Mich. Philadelphia. Pa. Attorney. Marshall & Eraser, Toledo, Ohio. American Iron & Steel Institute, New York, N. Y. Sales engineer. General Electric Co., Schenectady. N. Y. University of Kentucky. Bowling Green, Ky. 603 Continental Building, Baltimore. Md. , Consulting en^neer. Philadelphia, Washington. D. C. Professor of commerce. University of California. Memt>er of firm, F. C. Huyck & Sons, Albany, N. Y. Second vice president. Realty Guar- anty & Trust Co., Youngstown, Ohio. President, American Blower Co., De- troit, Mich. Inman, Howard & Inman, Atlanta, Ga. President and treasurer, Boorum & Pease, Brooklyn, N. Y. Chief, hide department, W. H. Mc- Elwain Co., shoe manufacturers, Boston, Mass. Tax expert. Taxpayers' Association, Santa Fe, N. Mex. Ptesident, Wm. R. Moore Dry Goods Co.. Memphis, Tenn. Salesman. Cfrouse-Hinds Co.. Syra- cuse, N. Y. Director of publications, Russell Sage Foundation, New York, N. Y. Sales department. Deere & Co., Moline, 111. Editorial writer, the New Republic, New York, N. Y. Washington, D. C. Retired. Professor of commerce and industry. University of Michigan. Associate professor of economics, Le- land Stanford Junior University. Assistant manager. International Correspondence Schools. Scranton, Pa. » Russell Sturgis Hubbard, chief of the Paint and Pigment Section, died in the service of his country on November 5, 1918. He had come to Washington with full knowledge that because of his health the supreme sacnfioe was not unlikely, and he carried on to the end with the finest courage. APPENDIX 519 MEMBERS OF THE WAR INDUSTRIES BOARD ORGANIZATION Continued Name Jones. Walter Clyde. Joy, Harold E Justus. Allen L. . . . . Kean, David L. . . . . Kearns, Percy H Kellenberger, Max W. Kelley, Geo. E. C. Kendall, Frank A.. Kerr, Clarence D. . Kerr, Karl S. . .^ Kilpatrick. Maj. J. R. King, Victor L. . . . . Kirkpatrick. C. C. . Kittredge, Lewis H. Kling, John A Klock, Lena M. . . . Knight, Thos. S Knight, W. Hughes. Knobel. John E. . . . Koch, William C. . . Koster. Frederick J. Kratz, John A Krohn. Irwin. . . . Krumb, Henry. . . Kurt. Franklin T. Lacombe, Maj. C. F. . . Lamar. Capt. Robt. W. Lambert. Howard S Lamond, William S Lamson, Frederick L. LaWall, Charles N Lawless. Matthew D Leddy, James C. ....,.••• Position in War Industries Board Counsel for nonwar construction section. Expert, rubber section Expert, lumber section . Assistant to chief, section on medical industry; chief, surgi- cal instruments and hospital equipment, section of medical industry. Secretary, legal section Reporter Auditor, rubber section . Statistician, building materials division. Secretary, clearance committee. . Crane section .^ Emergency construction com- mittee. ^ Chief, artificial dyes and inter- mediates section. Expert, nonwar construction sec- tion. Member facilities division Assistant, resources and conver- sion section. Assistant business manager, di- vision planning and statistics. Electrical and power equipment section, in charge of electrical department. Assistant to secretary, priorities committee. Director, division of business administrator. Assistant, resources and conver- sion section. Regional advisor. San Francisco Assistant to vice chairman. War Industries Board, in charge of cablegrams. Expert, boot and shoe section. . . Member of priorities committee. Staff, division planning and sta- tistics. Expert, power section ....do Superintendent of buildings, di- vision of business administra- tion. Priorities committee Staff, central bureau of planning and statistics. In charge Norfolk branch build- ing materials division. Member advisory committee, medical ^ agents, section cf medical industi^. Examiner, priorities division. . . . Assistant to business manager, purchasing committee. Former business Law firm, Jones, Addington, Ames & Seibold. Chicago, 111. Expert. B. F. Goodrich Co., Akron. Ohio. Partner manager. J. Natwick & Co., Baltimore, Md. G(>neral manager, Chas. Lentz & Sons, Philadelphia, Pa. Secretary to Oscar L. Gray, M.C. Stenotypist, Galbraith & Compton. oil producers. Independence, Kan. Cost auditor.Fisk Rubber Co.,Chico- pee Falls, Mass. Architect, 45 Bromfield Street, Bos- ton. Mass. Attorney. 6 Nassau Street. New York. N. Y. Fort Myer Heights, Va. Thompson-Starrett Co., building construction. New York, N. Y. Consulting chemical engineer, Wood Rid^. N. J. Publicity man. Chicago. lU. President. Peerless Motor Car Co., Cleveland, Ohio. President, Kelly^ Island Lime Co., Cleveland, Ohio. Secretary to business manager. Regal Shoe Co., Boston, Mass. Head of switchboard department. General Electric Co.. Boston, Mass. Attorney at law, Dallas, Tex. Manager personal estate, Chicago, Vice president Twin City Brick Co., St. Paul, Minn. ^ President, California Barrel Co., San Francisco, Calif. Practicing attorney. Charles Henry JSutler, Washington. D. C. .Partner in Krohn, Fechtheimer & Co., Cincinnati, Ohio. Consulting mining engineer. Sail Lake City. Utah. Owner of Chauncey Hall School, Boston. Mass. Electrical engineer. New York, N.Y. Electrical superintendent. Central Power Co., Canton, Ohio. Chief clerk. Central Railroad of New Jersey, Jersey City, N. J. Simplex "Wire & Cable Co., Boston, Treasurer. Norwalk Tire & Rubber Co., Norwalk, Conn. Sales manager. Clinchfield Portland Cement Co., Kingsport. Tenn. Dean, Philadelphia College of Phar- macy. Philadelphia, Pa. Lawless Bros., paper mills. East Rochester. N. Y. District auditor, Armoxir b Co., Chicago, lU. t ''!1 I . 'i k 520 INDUSTRIAL AMERICA IN THE WORLD WAR MEMBERS OF THE WAK INDUSTRIES BOARD ORGANIZATION Continued Name Lee, John W., jr. Lee. William L.. Legge. Alex. Leith, C.K Lengel, Wm. C Lennihan, Richard . . Leonard, Geo. M. . . . Leonard, Stephen R. . Letts, F.C Lewenberg, Harry L. Lewis, George Lewis, Henry S Leyden, Maj. H. R. Lbcoln, Alfred L. . Lipps, Louis P. . . . LipzHz, Louis. Lively, E.W.. Lodge, David M. Long, Walter F.. Loper, Ralph E.. Louis, Harry J. . . Lovcll, Raymond L. . Lovett, Robert S Lowe, George A. . . . , Lowerf, Floyd C. Lowery, Frank A. Lubin. Isadore , Lucas, George L. Lundoff, C. W Lyman. Clarence M. . . Lynn, Charles J McAllister, Wdliam B. McCauley. John S McCullough, Wm. E McCutcheon, Thomas P. . McDermott, Leo F Position in War Industries Board Expert, nonwar construction sec- tion. Expert, fire-prevention section. . Vice chairman. War Industries Board; chairman, require- ments division. Chief, mica section, and advisor in relation to mineral exports and imports. Publication work, employment management courses. Staff, conservation division Former business Conservation division Expert, steel division Requirements division Staff, division of planning and statistics. Assistant, gold and silver section Priorities committee Expert, power section Expert, hardware and hand tool section. Secretary, crane section Regional advisor. Dallas Expert, hardware and hand tool section. Assistant, woolens section Emergency construction com- mittee. Expert, cotton goods section . . . Chief, gloves and leather cloth- ing section, hide, leather and leather goods division. Expert, steel division Priorities Commissioner, retired Expert, fire prevention section . . Assistant, machine tool section. . Deceased; steel division Expert, divbion planning and statistics. In charge New York branch building materials division. Chairman, emergency construc- tion committee. Assistant to director, building materials division. Associate chief, section of medi- cal industry. Regional advisor, Cleveland Assistant chief, knit goods sec- tion. Member of advisory committee on plants and munitions. Technical advisor, chemical divi- sion, foreign service. Office manager, central bureau, planning and statistics. President and manager. Overland Syracuse Co.. Syracuse, N. Y. Inspector, Underwriter Service Asso- ciation, Chicago, 111. Vice president and general manager. International Harvester Co.. Chi- cago. 111. Professor of geology. University of Wisconsin, Wis. Publicity department, Hoggson Bros. New York, N. Y. Salesman, Lee. Higginson Co.. Bos- ton. Mass. Ellis Title & Conveyancing Co., Springfield, Mass. Second vice president, Oneida Com- munity (Ltd.), Oneida, N. Y. Red Cross representative. Red Cross Headquarters, Washington, D. C. Assistant to vice president, St. Louis Car Co., St. Louis, Mo. President, Shreve & Co., San Fran- cisco, Calif. Pittsburgh, Pa. Consulting engineer. New York, N. I. Retired, Taunton, Mass. Engineer with Brown Hoisting Ma- chinery Co., Cleveland, Ohio. Business for self, Dallas, Tex. Southern representative, L. S. Star- rett Co., Athol, Mass. Treasurer, John T. Lodge & Co... Boston. Mass. Boston, Mass. Consulting industrial engineer. Fall River, Mass. Manager, Bachner, Moses, Louis Co., Gloversville, N. Y. Broker. New York. N. Y. Special inspector and engineer. New England Insurance Exchange, Bos- ton. Mass. Sales engineer. Henry Prentiss & Co.. Buffalo, N. Y. Bethlehem Steel Co.. South Bethle- hem, Pa. Instructor in economics. University of Missouri, Columbia, Mo. Inspector. Public Service Commis- sion. New York, N. Y. President. Crowell Lundoff - Little Co.. Cleveland, Ohio. Manager, sales and publicity. Inter- national Heater Co., Utica, N. Y. Secretarv and general manager, Eli LiUv & Co . Indianapolis, Ind. President, W. B. McAllister Co., Cleveland, Ohio. President and manager, Cumberland Dry Goods & Notion Co., Cumber- land, Md. Cost clerk. Standard Steel Car. Co., BuUar. Pa. Professor of chemistry. University of Pennsylvania. A»Bnt, Library Bureau, New Yock, APPENDIX 521 MEMBERS OF THE WAR INDUSTRIES BOARD ORGANIZATION Continued Name McDonald, Joseph A. McGowan, Rear Admiral Samuel. McKellar. Wm. D McKelvey, C. W McKenney, Col. Chas. A. . McLain, Percy McLauchlan, Jay C McLeary, Frank B McLennan. Donald R Mc Williams. Chas. M. . . . MacDowell. Charles H. . . Mackall, Paul MacLaren, Maj. Malcolm. Macpherson, Frank H. . . . Mahoney, J. Bernard. MaUalieu. W. E Mann, David F. . Manning, John J. Mansfield, Wm. L.. Manss. Wm. H Mapother, Dillon E Marshall, Ross S Martin, Capt. Andrew Penn. Martin, Willard B Mason, Newton E., rear ad niiral, U. S. Navy, re lired. Matlack, John C. Maxwell, Lloyd W. Mebane, James K.. Meffert. Benj. F.... Merchant, Ely O.. . Mercury, Chester C. Merrill. W.H Merry weather, George E. . Merwin, John , Position in War Industries Board Expert, steel division . Navy representative, conserva- tion division. Assistant chief, domestic wool section. Member legal section Former business Army representative, priorities committee. Examiner, priorities division Chief, pig-iron section , Staff, central bureau of planning and statistics. Chief, nonwar construction sec- tion. Examiner, priorities division Director of chemical division . . . Foreign representative, steel di- vision. Expert, power section Member, priorities committee. . . Deceased; secretary, B. M.Baruc! Member fire-prevention section . . Expert, steel division Member, war prison labor and na- tional waste reclamation sec- tion. Passenger representative, inland traffic section. Director, war service committees Assistant, paint and pigment sec- tion. Staff, central bureau of planning and statistics. Secretary, B. M. Baruch at peace conference. Chief clerk. War Industries Board. Priorities committee Expert, rubber section. Statistician, division of planning and statistics. Assistant to director textile divi- sion. Associate, cotton goods section. , Expert, pulp and paper division . Charge of reception room, priori- ties division. Chief, fire prevention section . . . . Chief, machine tool section Expert, electric and power equip- ment sectiozi* Vice president, Clark Car Co., Pitta- burgh, Pa. Washington, D. C. Wool buyer. Salt Lake City. Utah. Member firm Stewart & Schearer. New York, N. Y. Consulting engineer, Washington President and treasurer, J. H. McLain Co., Canton, Ohio. Member of firm, Picklands, Mather & Co., Cleveland, Oiiio. Examiner, the Examination Corpora- tion, New York, N. Y. Marsh & McLennan, Chicago, IlL Lawyer, Houston, Tex. President, Armour Fertilizer Works, Chicago, 111. Assistant sales inanager, Bethlehem Steel Corporation, Bethlehem, Pa. Professor of electrical engineering, Princeton University. President and treasurer, Detroit Sul- phite Pulp & Paper Co., Detroit, Mich. Washington, D. C. General manager National Board of Fire underwriters. New York, N.Y. Sales agent, Pittsburgh Steel, Co., Pitt3i)urgh, Pa. Secretary, Union Label Trades De- partment, American Federation of Labor, Washington, D. C. Assistant city ticket agent, Chicago, St. Paul, Minneapolis & Omaha Ry., Minneapolis, Minn. Chamber of Commerce, Riggs Buildc ing, Washington, D. C. Real estate, Louisville, Ky. Superintendent, Seaboard Air Line Ry. Co., Norfolk, Va. Squire. Sanders & Demsey. Cleve- land. Ohio. Private secretary to president Cen- tral R. R. Co. of New Jersey, Plainfield, N. J. Washington, D. C. Treastlrer and general manager, Ajaz Rubber Co., New Ytjrk, N. Y. Assistant educational director, Y. M. C. A., New York, N. Y. Secretary and treasurer, Scott-Me- bane Manufacturing Co.. Graham, N. C. Partner of Amory, Browne & Co., New York, N. Y. Special agent. Federal Trade Com- mission, Washington D. C. South American representative, Geo. D. Emery Co , mahogany and mines, Boston, Mass. President,^ Underwriters Laborato ries, Chicago, 111. President, the Motch & Merry weath- er Machine Co., Cleveland, Ohio. Assistant manager, sales office,Kurke Electric Co., New York, N. Y. »*< I *^ 1 1 I r 522 INDUSTRIAL AMERICA IN THE WORLD WAR MEMBERS OF THE WAR INDUSTRIES BOARD ORGANIZATION Continued Name Position in War Industries Board Meyer, A. J Meyer, Eugene, jr.. Milbank, Ounlevy. Mller, Ellis Miller, F. A Miller, George E Milne, Wm. D Miltenberger,Capt. Geo.K. Minnick, Arthur , Elzpert, fire prevention section , . Expert, nonferrous metals Exi>ert, fac.lities division Division planning and statistics . Expert, noa war construction sec- tion. Expert, facilities division Former business Mitchell. Andrew W MitcheU, Maj. J. K Mitchell, Dr. Wesley C..., Montgomery, Fletcher H.. . Montgomery, Lieut. Col Moody, Herbert R, Moore, Kilburn Morehead, Maj. John M.. . Expert, fire prevention section . Expert, power section , War Industries Board represen- tative in joint office on chemi- cal statistics. Expert, nonwar construction sec- tion. Staff, conservation division Chief, price statistics. Expert, felt section. . Morgan, Wm. P. . . Morgan, Wm. O. . . Morley, Charles D. Army representative on price- fixing committee. Technical advisor, chemicals di- vision. Expert, priorities division Morrisey, James R. Morrison, John A. . Matae, Edward N.., Morse. Frank W... Morss, Everett. Morton, Ivon T. Moulton, H. G.... Murchison, Capt. Ken- neth M. Murray, William M. Chief, coal and gas products sec- tion. Regional advisor. New York,N.Y. Expert, priorities division Assistant to chief building ma- terial section. Expert, fire prevention section . . Expert, priorities division Assistant to Mr. S. P. Bush Member, special advisory com- mission on plants and muni- tions. Chief .brass section, member pri- orities committee. Draftsman, building material section. Nonferrous metals, chief abra- sives section. Resigned May. 1918. Emergency construction. Murto, Mary F. . Musser, James C. Naumburg, George W. Naumberg, Ruth M. . . Nelson, Frank T Nawton. Maty E Section on medical industry Secretary, Mr. Hugh Frayne Secretary, clearance office, re- quirements division. Assistant to chief, cotton and cot- ton linters section. Division planning and statistics . . Member, legal section Chief, bureau of personnel, divi- sion of business adminutration. Inspector, Indiana Inspection Bu- reau, Indianapolis, Ind. New York, N. Y. R.>al estate and investments. New York, N. Y. Professor, Johns Hopkins University, Baltimore, Md. Auto Strop Safety Razor Co., New York.N.Y. Sales manager, Cleveland Electrical &IIluminatingCo.,CleveIand,Ohio. Inspector, Underwriters' Bureau of New England, Boston, Mass. Electrical engineer. Union Electric Light & Power Co., St. Louis, Mo. First assistant examiner. United States Patent Office, Washington. D. C. Salesman, Chicago, 111. Philadelphia Rubber Works, Land Title Building, Philadelphia, Pa. Ptofessor of economics, Columbia University. President, Knox Hat Co., New York, N. Y. Member of the firm of Lybrand-Ross Bros. & Montgomery, New York, Professor of industrial chemistry. College of City of New York, N.Y. Member firm Moore & Goodman, Galveston, Tex. Consulting engineer. Union Carbide & Carbon Corporation and People's Gas Co., Chicago, 111. Attorney. New \ork. N. Y. Do. President, Morley Bros. Construc- tion Co., St. Louis, Mo. Engineer, Wisconsin Inspection Bu- reau, Milwaukee, Wis. General agent, Aetna Life Insurance Co.. Chicago, III. Private secretary to C. D. Velie, Minneapolis, Minn. Retired. Atlantic City, N. J. President Morss & White Co., Sim- tlex Wire & Cable Co., Simplex llectric Heating Co.,Boston,Mass. Drawing instructor, school commis- sioners, Anne Arundel County, Berwyn, Md. Treasury Department, Washington, D. C. Architect, New York, N. Y. Purchasing agent. Red Cross, Wash- ington, D. C. Washington, D. C. Law firm, Musser, Kimber, Huffman & Musser, Akron, Ohio. Member of firm, £. Naumburg & Co. (bankers), N. Y. 1755 R Street NW., Washington, D. C. Laucking, Helfman, Laucking, Ham- Ion, lawyers, Detroit, Mich. Appointment division. Census Bu- reau, Washington, D. C. APPENDIX 523 MEMBERS OF THE WAR INDUSTRIES BOARD ORGANIZATION Continued Name Nibley. Alex. Nichols, Harold W. Nixon. Frederick K.. . . . , Norris. Henry M x^ oyes. X . D. .••....•••, Offield, James R. Oliver. George S Olmsted. Frederick Law. . Ordway. Lucius P Ormsby. William J Otis. Charles A. Paige. H. Ray Paine, Catherine , Palmer, G. J , Parker, Edwin B Parmenter, Vernon E Parsonage. Edward E Patterson, Albert M Patton, James E Paxton, Jesse W. Peabody, Herbert E Peek, George N Penfield, Frederick W... Pengnet, Ramsay Penick, Frank E Pennock, Stanley A. .... . Penwell, Lewis Peoples, Admiral C. J., United States Naw. Percy, D. C. Steward Perkins, Thomas Nelson. Perry, Harry W Peters. Richard, jr.. . , . Phelps. Wm. Walter. . . Phenix, Capt. Spencer. Philbrick, Merchant E. Position in War Industries Board Expert, lumber section. Chief, fiber board and containers section, pulp and paper divi- sion. Expert, foreign wool section Assistant, machine tool section, Cincinnati. Fuel Administration representa- tive on requirement division. Expert, priorities division Former business R^onal advisor. Pittsburgh. Emergency construction Member priorities commission. . , Assistant section chief, priorities committee. Chief, resources and conversion section. Assistant, nitrate section Expert, division planning and statistics. Chief, newspaper section , Priorities commissioner Division planning and statistics . Chief, _ agricultural implement section. Chief, foreign wool section Associated chief, paint and pig- ment section. Priorities examiner Chief, woolen section Commissioner of finished prod- ucts. Rating committee, priorities board. Secretary, silk section Assistant business manager, pur- chasing commission. Pulp andpaper division Chief, domestic wool section . . . Requirements division. Navy representative. Expert, fire prevention section . Member priorities committee . , Assistant chief, automotive prod- ucts section. Assistant chief, iron and steel scrap section. Secretary, price-fixing commit- tee. Division planning and statistics . Expert, lumber section Resident manager. Grande Ronde Lumber Co., Perry, Oreg.; Utah- Idaho Sugar Co.,Grand Pass, Oreg. President, Fox Paper Co. and the Chesapeake Pulp & Paper Co.. Cincinnati, Ohio. President, Nixon, Walker & Tracy, New York, N. Y. Bickford Tool Co.. Cincinnati, Ohio. Oneida Community (Ltd.), Oneida, President, Bon Air Coal & Iron Cor- poration. Chicago, III. President, the Newspaper Printing Co., Pittsburgh, Pa. Olmsted Bros., Landscape Archi- tects and City Planners, Brookline, Mass. President, Crane-Ordway Co., St. Paul, Minn. National bank examiner. Farm Loan Board, Washington, D. C. Member of firm, Otis & Co., Cleve- land, Ohio. President, H. Ray Paige & Co., New York, N. Y. Business Administration, Boston, Mass. _ Active vice president, the Houston Post, Houston, Tex. Law firm. Baker, Botts, Parker & Garwood, Houston, Tex. Dennison Manufacturing Co., Fram- ingham, Mass. Secretary and manager of the John Deere Wagon Co., Moline, 111. Pi-esident, Textile Alliance, New York; Waterloo Woolen Manufac- turing Co., Waterloo, N. Y. President, Patton Paint Co., Pitts- burgh, Pa. President, Highland Glove Co., Washington. Pa. Sales agent, Shelbourne Mills, New York, N. Y. Vice president, Deere & Co., Moline, Treasurer, Aetna Powder Co. Chicago, ni. Secretary, Silk Association of Amer- ica, New York. N. Y. Auditor of sales in Russia, Interna- tional Harvester Co., Chicago, 111. Advertising expert, Philadelphia, Pa. and Trenton, N. J. Lewis Penwell Co., Helena, Mont. Navy Department. Washington, Inspector, Philadelphia Fire Under- writers' Association, Philadelphia, 60 State Street, Boston, Mass. Secretary, Good Roads and Motor Truck Committees, New York, X^ « X • Representative of Rogers. Brown & Co., Philadelphia, Pa. Director Wm. Walter Phelps estate (Inc ), New York, N. Y. General Staff, Washington, D. C. Secretary, John M. Woods Lumber Co., Memphis, Tenn. .. i r« r I \ ^lU w \:\ r 524 INDUSTRIAL AMERICA IN THE WORLD WAR MEMBERS OF THE WAR INDUSTRIES BOARD ORGANIZATION Continued Name Phillips, William Vernon Phillipps, Henry G Picken, Capt. James H. . Pierce, B. D., jr Kerce. Curtis W Pierce, Dana Pierce, Edward Allen . . . Pierce, Frank L Pierce, Brig. Gen. Palmer Pierpont, Lawrence . Piez, Charles R. . . . . Position in War Industries Board Chief, iron and steel scrap section Secretary, priorities board Assistant to Army representa- tive, price-fixing committee. Regional advisor, Bridgeport, Conn. Expert, fire prevention section . ...do Pinci, Anthony R. Pindell, Robert M., jr. Pollak, W. H. Pond, Helen P. Pool, M. B.... Potter, Arthur M. Potter, Zenas L. . . Powell, Thomas C. , Prescott, Sherburne. Prindle, Arents L. . . Prosser, E. A Pumell, Frank . Pyne, Grafton H. . Radcliff, George S. Rakestraw, B. B. . Ransome, F. H. . . Ransome, R. G.. . Rea, Henry R. . . . Reay, W. M... Reed, J. Burns. General business executive, for- eign mission. Expert, fire prevention section Member War Industries Board, Army, representing War De- partment. Chief clerk, priorities division . . Emergency Fleet CorjMjration representative on priorities board. Assistant to Mr. Frajoie, former chief personnel division. Executive secretary, hides, leather, and leather goods divi- sion. Member legal section Comfort and welfare committee Red Cross representative, re- quirements division. Assistant chief, automotive prod- ucts section. Expert, central bureau, planning and statistics. Member priorities committee, chief inland traffic section. Assistant to chief, cotton and cotton linters section. Secretary, automotive products section. Associate chief, tanning material and natural dye section (in- cluding oils, fats and waxes). Assistant to director of steel supply. Former business Assistant, steel divsion. Cut soles expert, hide, leather, and leather goods division. Business manager, division plan- ning and statistics. Lumber section Assistant to secretary, priorities committee. _ Member special advisory com- mittee on plants and muni- tions. Allied purchasing commission . . Chemicals President, F. R. Phillips & Sons. Philadelphia, Pa. Vice president, American Bottle Co., Chicago, 111. Consulting Advertising Service, Chi- cago, 111. Director and executive committee, Bridgeport Trust Co.; president, Connecticut Quarries Co., etc., Bridgeport, Conn. Continental Insurance Co., 89 Maiden Lane, New York City. Vice president, Underwriters' Lab- oratories, New York, N. Y. Member firm A. A. Housman, 20 Broad Street, New York, N. Y. President, What Cheer Mutual Fire Insurance Co., Providence, R. I. War Department, Washington, D. C. Poultry raising, Bushfield, Va. Vice president and general manager Emergency Fleet Corporation, Philadelphia, Pa. Writer, Munsey, Outlook, Harpers Weekly, etc., Washington, D. C. Vice president Southern Settlement and Development Organization. Baltimore, Md. Law firm, Englehard, Pollak, Pitcher & Stein, New York, N. Y Washington, D. C. Red Cross headquarters, Washington, D. C. Manager car-order division. Dodge Bros., Detroit, Mich. Head of publicity department. Na- tional Cash Register Co., Dayton, Ohio. Vice president. Southern Ry. Co., Cincinnati, Ohio. Vice president, Anglo-American Cot- ton Products Co., New York, N. Y. Assistant to S. A. Miles, New York, N. Y., and Chicago, 111. Industrial chemist and salesman, Born Scrymser Co., oils. New York, N. Y. Manager of order and sales depart- ments, Youngstown Sheet & Tube Co., Youngstown, Ohio. Member of firm Post & Flagg, New York, N. Y. Member of firm Boston & Lynn Cut Sole Co., Lynn, Mass. Assistant manager, Weinstock, Lu- bin & Co., Sacramento, Calif. Eastern & Western Lumber Co., Portland, Oreg. Vice president Bostrop Water, Light & Ice Co., Bostrop, Tex. Retired, Pittsburgh, Pa. Chief of auditing department. Inter- national Harvester Co., Chicago, 111. Assistant professor of mining. Case School Applied Science, Cleveland, Ohio. APPENDIX 525 MEMBERS OF THE WAR INDUSTRIES BOARD ORGANIZATION Continued Name Reed, Lewis B Rees, Thomas M Replogle, J. Leonard Reynolds, Stanley M Rhoades, Philo B Rice, Capt. Willis B Richardson, David Robt. . Richardson, Nicholas .... Richardson, Ralph I Riddle, Capt. Geo. W. . . . Riley, Charles W Riley, Maj. J. W Rippin, Lieut. J. Y Ritchie, Albert C Hitter. William M Robbins, Walter Robinson, WiUiam C Rogers, Charles A Rogers, Chilnton L. Root, Charles T Roper, Frank A Rosenberg, William S. . . . Rosengarten, A. G Rosensohn, Maj. S. J Ross, Harry C Rossiter, William S Rossiter, W. T Itoutsong, Ralph C Rowbotham, George B. . . Rowland, Joseph W. RuUman, Chas. Phillip. . . Rumbaugh, R. L Sadler, Capt. Harry M. . . Position in War Industries Board Assistant to G. N. Peek Expert, machine tool section . . ^Director of steel supply , Publicity work Assistant warehouse section, steel division. Army representative, joint oflSce on chemical statistics. Expert, priorities division Expert, fire prevention section . Accountant, steel division Temporary assistant to director of building material division. Assistant, f acihties division .... Member war prison labor and national waste reclamation section. • do General counsel, War Industries Board. Assistant to committee on fin- ished products (certifying officer). Assistant to committee on fin- ished products; chief, electric and power equipment section. Expert, fire prevention section. Chief, harness and personal equipment section, leather division. Auditor,^ division of business administration. Chief, periodical section, pulp and paper division. Staff, central bureau of planning and statistics. Reporter Chief, ^ miscellaneous chemical section. Member war prison labor and national waste reclamation section. Assistant to chairman, conserva- tion division. Staff, central bureau of planning and statistics. Assistant to chief, resources and conversions section. Expert, central bureau of plan- ning and statistics. Chief, belting section, hide, leather, and leather goods divi- sion. Assistant to chief, rubber section Domestic wool section Expert, fire prevention section . Examiner, Army section, priori- ties committee. Former business Vice president. United States Silica Co., Chicago, 111. Sales engineer, Motch & Merry- weather Machine Co., Cleveland, Ohio. President American Vanadium Co., New York, N.Y. Committee on Public Information, Washington, D. C. Manager warehouses the Bourne- Fuller Co., Cleveland, Ohio. Law firm Duell, Warfield & Duell, New York, N. Y. Secretary, Richardson & Boynton Co., New York. N. Y. Inspecting Engineer, Underwriters Bureau of New England, Boston, Mass. Chief clerk, Cambria Steel Co., Johnstown, Pa. ^ Construction Division, U. S. Army, Washington, D. C. Attorney, Akron, Ohio. Adjutant General's office. Reclamation Division, U. S. Army. Attorney general of Maryland, Balti- more, Md. President, W. M. Ritter Lumber Co., Columbus, Ohio. Vice president, Wagner Electric & Manufacturing Co., St. Louis, .Mo. Vice president. Underwriters' Lab- oratories, Chicago, III. Retired, Hartford, Conn. Senior accountant. Baker, Vawter & Wolf, Chicago, 111. United Publishers Co., director. New York, N.Y. , Farm Economics Department, De- partment of Agriculture. Reporter, New York, N. Y. Vice president and treasurer, Powers- Weightman - Rosengarten Co ., Philadelphia, Pa. War Department, Washington, D.C. Care of F. P. Luther Co., railway equipment, Chicago, IlL President Rumford Printing Co., Concord, N. H. Vice president and general manager of the Cleveland Builders' Supply Co., Cleveland, Ohio. Welfare director. National Cash Register Co., DaytoB« Ohio. President, Bay State Beltbg Co., Boston, Mass.; Southern Belting Co., Atlanta, Ga., etc. Office manager, Fisk Rubber Co., Chicopee Falls, Mass. Lambert Huntington Co., 79 Fifth Avenue, New York, N. Y. Inspector, Western Sprinkler Risk Association, Chicago, 111. Manager, mail order department. Spear & Co., Pittsburgh, Pa. Ill H or I. I rfl< • f m i 1 m 526 INDUSTRIAL AMERICA IN THE WORLD WAR MEMBERS OF THE WAR INDUSTRIES BOARD ORGANIZATION Continued Name Saeger. Wilford C. Salomon, Joseph. . Sanford. Hugh W. Sargent, Murray Sawyer, Capt. Daniel E. . Sawyer, Harry A Schaaf, F. A. Schaffer, Herbert Allen , I •••••• I Schlosser, Alexander L.. , Schmidt, John C Schmuckler, Jacob Schneider, Albert . . Schoelkopf , J. F. . . Schravesende, P. B. Schubert. Frank H. Scott, Frank A. '«•«••«* Scott, John W. , Scott. LeUnd... Scott, Ruftts W. Scott. W.G Seaman, Irving. Selden, Ernest L Selfridge, Edward A Sever, Maj. Geo. F.. Seward, George N Shaw. A, W. Shaw.Maj. C, H Shaw, George M. Shaw. Jean M. Shepard. William P.. . Sherman, Karl W. , Shidle. Geter C ShotweM, Edward C Siebenthal Myrtle M KmpsQDt Lieut. CoL F. F. . . Position in War Industries Board Member legal section. Secretary, industrial adjustment committee, priorities division. Chief, ferro alloys section Chief, hardware and hand tool section. Chief of projectile, steel rails, etc., .section. Expert, chemical statistics. .... Examiner, priorities division . . . Assistant to director, building material division. Assistant and secretary to H. B. Swope. Chief, chain section Nonferrous metals section Former business Reporter Chief, artificial and vegetable dye section. Assistant chief, agricultural im- plement section. Expert, electric and power equip- ment section. Chairman munitions board,chair- man War Industries Board, Aug. 1 to Nov. 1, 1917. Director of textile and rubber division Examiner, inland traffic section . Associate chief, knit-goods sec- tion. Disbursing officer, division of business administration. Expert, priorities division Statistician, division of planning and statistics Expert, lumber section. ....... Expert, power section Statistician, division of planning and statistics. Chairman conservation division. Expert, power section Member advertising committee on plants and munitions. Expert, hardware and hand-tool section. Assistant, conservation division Assistant chief, jute, hemp, and cordage section. Expert, steel division ......... Expert, hides, leather, and leath- er goods division. In charge of conferences and re- ports, secretary's office. Oiief , section of medical industry Law firm of Bulkley, Hauxhurst, Saeger & Jamieson, Cleveland, Ohio. Lawyer. Washington, D. C. Treasurer and general manager, San- ford-Day Iron Works, Knoxville. Tenn. Secretary, Sargent & Co., New Haven, Conn. Salesman, Block Maloney & Co., Chicago, 111. Assistant chemical en^neer, Amer- can University, Washington, D.C. Adam Schaaf, Chica^, 111. Member of firm, Harrison & Schaffer, Easton, Pa. Assistant and secretary to H. B. Swope, New York World. President, Schmidt & Ault Paper Co.. York, Pa. Care J. J. Cami)bell, 1725 Sedwick Avenue, Morris Heights, N. Y. Reporter, New York, N. Y, Vice president. National Aniline & Chemical Co., Buffalo, N. Y. President, Grand Rapids School Equipment Co., Grand Rapids, Mich. Production manager, Wheeler Con- denser & Engineering Co., Cataret, N. J. Vice president. Wamer-Swasey Co., Cleveland, Ohio. Member of firm, Carson, Pirie, Scott & Co., Chicago, 111. Traffic expert. Traffic Association Coal Co., Birmingham, Ala. Member of firm. Wm. F. Taubel (Inc.), Riverside. N. J. Examiner, Naturalization Service, Department of Labor. Secretary. W. D. Seaman. Milwau- kee, Wis. Accountant, Oliver Mining Co., Hadlyme, Conn. IVesident. Northwestern Redwood Co.. Wiflits. Calif. Professor of electrical engineering, Columbia University. Accountant _and_ efficiency man, Minneapolis. Minn. President, A. W. Shaw Co.. Chicago. 111. , Electrical engineer, Minnesota Pow- er Co., Eveleth, Minn. Mechanical engineer. Standard Steel Car Co., Butler, Pa. Vice president, secretary, and gen- eral manager. Geo. H. Adams & Co., Hill. N. H. Professor of romance languages. Hamilton College. Manager, hair department. Morris & Co., Chicago. 111. Selling agent, Pittsburgh office. La. BeU Iron Works, Steubenville.Ohio. Member of firm, S. H. Shotwell & Sons, Gloversville, N. Y. Washington. D. C. Surgeoo, Pittsburgh, Fa. APPENDIX 527 MEMBERS OF THE WAR INDUSTRIES BOARD ORGANIZATION Continued Name Skinner, William. . Sloan, Harry M. . , Small, A. R. Smith, Arthur H Smith, A. Homer Smith, Austin D Smith, Charles Henry. . . . . Smith, E. A Smith, George F. Smith, Harold O Smith, Lewis Reading. . . . Smithers, John F. Snowdcn, Howard J. Sowers, W. J Spillman, Dr. W. J. Staley, Homer F. Stamp, Capt. Charles E. . Stanley, Capt. W.W... Starrett, Col. W. A , Stein, C.S , Steinert, Jerome Stephenson, Bertram S.. , Stewart, Oswald W. Stewart, W.W. Stockdale, Raymond D. . Stoddard, Lawrence J.. . . Stone, George C. . . . Stout, Charles F. C. Stroock, Sylvan I. . . Stuart, Henry C. . , Styles, Maxwell A. Summers, Leland L. . Sweet. Edwin F. Swope, Herbert Bayard. . Position in War Industries Board Chief, silk section. Assistant to chief, nonwar con- struction section. Expert, fire prevention section . . Associate chief, wood chemicals section. Assistantchief,sectionof medical 'industry. Assistant, ^ warehouse section, steel division. Association chief, fire prevention section. Secretary, lumber section Chief, flax products section .... Assistant to chief, automotive prodticts section. Expert steel division Private secretary to B.M.Baruch Member advisory commission on plants and munitions. Southern lumber administrator . Member war prison labor and national waste reclamation section. Technical advisor on ceramics, chemical division. Assistant chief, crane section. .. Expert, power section Chairman emergency construc- tion committee. Member legal section Expert, fire prevention section . . Expert, steel division Expert, fire prevention section . . Staff, division of planning and statistics. Secretary to W. M. Ritter. Expert, hardware and hand-tool section. Expert, nonferrous metals section Director of hides, leather, and leather goods section. Chief, felt section Member price-fixing committee. Assistant to director, building material division. Technical advisor, and chairman foreign mission. Member war prison labor and national waste reclamation section. Associate member of War Indus- tries Board, assistant to chair- man. Former business President. Wm. Skinner & Sons, New York, N. Y. Assistant to Federal manager, Chi- cago Rock Island & Pacific R. R. Co., Chicago, 111. Vice president,^ Underwriters* Lab- oratories, Chicago, HI. Assistant secretary, Wm. S. Gary & Co., New York. N. Y. H. K. Melford Co.. PhUadelphia. Pa. Superintendent of warehouse, David H. Smith & Sons, Brooklyn. N. Y. Vice president, Blackstone Mutual Fire Insurance Co., Providence,R.I. Wm. Cady Lumber Co., Mc\ary,La. President, Smith & Dove Manufac- turing Co., Andover, Mass. President, J. & D. Tire & Rubber Co.. Charlotte, N. C. Salesman, Matthew Addy Co., Phil- adelphia, Pa. Attorney at law. Providence, R. I. Draftsman, the Baldwin Locomotive Works, Philadelphia, Pa. Member of firm, Majors-Sowers Saw- mill Co., Epley, Miss. Associate editor, the Farm Journal, Washington, D. C. Technical director. Standard Sani- tary Manufacturing Co., Pitts- burgh, Pa. President and treasurer, C. E. Stamp Co., Cleveland, Ohio. Assistant to president, Wasson Pis- ton Ring Co., New Brunswick,N.J. Starrett & Van Vleek, architects. New York, N. Y. Law firm, Englehard, Pollack, Pit- cher & Stein, New York, N. _Y. National Board of Fire Underwriters, 76 William Street, NewYork, N.Y. Resident agent, M. A. Hanna & Co., Pittsburgh, Pa. Engineer, Manufacturers Mutual }rest examiners. United States Forest Service. Inspector, Michigan Inspection Bu- reau, Detroit, Mich. Richard L. Wood Co., Buffalo, N. Y. Mana^r, Chicago office, Sanderson « Porter, engineers and con- tractors. President, American Radiator Co- New York, N. Y. APPENDIX 531 MEMBERS OF THE WAR INDUSTRIES BOARD ORGANIZATION Contimied Name Woolson, Prof. Ira A Worcester, Chas. H Wyman, Henry A Wynegar, Howard L. . . . . Yeatman, Pope Young, Neil Yuengling, George W Zane, A. V., rear admiral U. S. Navy, retired. Position in War Industries Board Advisory engineer, building ma- terials division. Lumber committee Member, brass section Assistant, nonwar construction section. Chief, nonferrous metals section . Expert, electric and power equip- ment section. Executive assistant, miscellane- ous commodities section. Priorities committee Former business Consulting engineer. National Board Fire Underwriters, New York.N.Y. 1409 Y. M. C. A. Building. Chicago. HI. Attorney, Boston, Mass. Vice president. Continental Guar- anty Corporation, New York,N.Y. Consulting engineer. New York.N.Y. Assistant manager, industrial de- Sirtment, Westinghouse E. & M. o.. East Pittsburgh, Pa. ^ Secretary, Globe Indemnity Co. New York, N. Y. Washington, D. C. I I ltl I, k i «i Hi! APPENDIX Vn WAR SERVICE COMMITTEES OF THE CHAMBER OF COMMERCE OF THE UNITED STATES, AND MEMBERS THEREOF 1 4 i War Service Executive Committee Harry A. Wheeler, chairman. Joseph H. Defrees, vice-chair- man. A. C. Bedford. William Butterworth. W. L. Clause. L. S. Gillette. John H. Fahey. W. H. Manss. ACCOUNTINQ . Edw. L. Suffem, chairman. A. P. Richardson, secretary. W. Sanders Davies. Chas. S. Ludlam. Robt. H. Montgomery. Charles H. Nau. Henry A. Niles. J. E. Sterrett. Arthur W. Teele. Asbestos and Magnesia George D. Crabbs, chairman. C. J. Stover, secretary. W. A. Macan. Richard V. Mattison, jr. C. B. Jenkins. S. R. Zimmerman. Automobiles Hugh Chalmers, chairman. John N. Willys. H. H. Rice. George M. Graham. Alfred Reeves. Automobile Dealers F. W. A. Vesper, chairman. Earl C. Anthony. Chas. Collier. A. E. Mitzel. A. E. Maltby. F. E. Murphy. Dayton Keith. J. H. McAlman. Geo. D. McCutcheon. O. P. Tyler. Fred J. Caley. Chas. M. Browne. Finley L. MacFarland. Baby Vehicles O. W. Siebert, chairman. G. A. Keyworth. Frank Wissig. Hugh Hill. P. C. Kendall. W. S. Ferris. Bags (Burlap and Cotton) Exeeutiee Committee Albert F. Berais, chairman. Everett Ames. Bags — Continued Executive Commitiee — Con. Benj. Elsas. E. K. Ludington. G. D. Adams. E. W. Mente. J. B. Morgan. Subcommittee on Cotton Benjamin Elsas, chairman. Geo. N. Roberts. Benj. D. Riegel. F. P. Mann. A. S. Bowen. Subcommittee on Burlap A. V. Phillips, chairman W. N. Morice. J. W. Falconer. J. R. Dewitt. Everett Ames. Baking Frank R. Shepard. chairman. Jay Burns. Robt. L. Corby. Wm. Friehofer. John F. Hildebrand. S. F. McDonald. Wm. M. Regan. Paul Schulze. B. Howard Smith. Gordon Smith. Geo. S. Ward. A. L. Taggart. Ball Bearings and Steel Balls W. M. Nones, chairman. C. T. Treadway. F. M. Germane. H. K. Smith. L. J. Hoover. W. H. Strom. Isaac Andrews. Barbers* Supplies Fred Dolle, chairman. Joseph Gibson. A. Edlis. Christ Kohler. J. E. MiUer. Martin Hanson. W. W. Page. J. V. Reed. Bernard DeVry. Baskets and Fruit Packages R. G. Williams, chairman. M. O. Overstreet. M. H. Stuart. J. H. Schlegel. J. R. Jarrell. J. M. Simmons. Bicycles E. J. Lonn, chairman. Col. F. T. Huffman. J. P. Fogarty. W. G. Schack. H. S. Wise. Percy Pierce. I. Schwinn. Biscuits and Crackers Brooks Morgan, chairman. John H. Wiles. R. E. Tomlinson. Boots and Shoes John S. Kent, chairman. Frank R. Briggs. Fred B. Rice. Wm. S. McKenzie. Henry W. Cook. Frank C. Rand. John W. Craddock. A. S. Kreider. M. S. Florsheim. John R. Garside. L. H. Downs. Walter J. Hallahan. Sol Wile. J. Frank McEIwain. John A. Bush. A. N. Blake. Frank X. Kelly. Mark W. Selby. F. L. Weyenberg. Boxes (Paper) A. G. Burry, chairman. H. M. Hoague. Frank E. Vincent. Ernest Spaulding. E. P. Franke. W. W. Baird. W. B. Dickerson. Geo. E. Staebler. H. L. Stortz. C. M. Coover. Boxes (Wooden) Geo. L. Crosman, chairman. B. F. Masters. R. W. Jordan. C. Fred Yegge. Louis Wuicnet. Brass and Copper Roll- ing Mills A. P. Swoyer, chairman. H. J. Rowland. L. G. Kibbe. A. A. Ainsworth. Brass and Copper Tubes (Small Sizes) Henry T. Smith, chairman. F. W. French. Brass and Copper Tubes (Small Sizes) — Con. Clifford H. Wells. F. J. DeBishop. Philip Smith. Brass and Copper Tubes (Commercial Sizes) John P. Elton, chairman. W. S. Eckhert. L. H. Jones. W. R. Webster. R. L. Coe. Brewing C. W. Feigenspan, chairman. E. A. Schmidt. Edw. Landsberg. Louis B. Schram. Wm. Hamm. Gustave Pabst. Jas. R. Nicholson. Julius Liebmann. Hugh F. Fox. Brick (Building) George H. Clippert, chairman. J. W. Robb. Wm. K. Hammond. John W. Sibley. Theo. A. RandalL Brick (Face) Jos. W. Moulding, chairman. F. W. Butterworth. H. E. Stringer. R. D. T. Hollowell. Brick (Pa\tng) C. C. Blair, chairman. Will P. Blair, vice chairman. J. W. Sibley. W. G. D. Orr. A. L. Shulthis. R. T. Hutchins. Building Industry B. P. Affleck, chairman. Col. J. R. Wiggins. John H. Kaul. A. M. Maddock. Charles Gompertz. John A. Kling. W. L. Clause. Walter S. Dickey. Rudolph P. Miller. Metal Ceiling J. M. Gleason, chairman. James P. Dolan. G. J. Kohler. Louis Kuehn. W. F. Norman. Metal Lath Zenas W. Carter, chairman. W. H. Foster. Howard W, Foote. Julius Kahn. A. R. Yancy. J. A. Thomas. W. G. Hurlburt APPENDIX Canned Foods and Dried Fruits Brokers B. W. Housum, chairman. Wm. H. Nicholls. Jos. H. Kline. F. A. Alpin. Jas. M. Hobbs. Jos. Keevers. Carriages Philip Ebrenz, chairman. W. H. Rominger. C. R. Crawford. Frank Delker. E. J. Schlamp. J. H. Poste. H. A. Crawford. J. D. Craft. W. G. Norman. Caskets P. B. Heintz, chairman. William Mauthe. A. R. Betts. A. A. Breed. E. L. Ewing. John M. Byrne. Cereals C. T. Lee, chairman. H. C. Flint. H. L. Smith. S. H. Small. Arthur Dunn. G. G. Guernsey. Chain C. M. Power, chairman. Staunton B. Peck. A. B. Way. Welded chain C. M. Power, chairman. Robert J. McKay. Frank A. Bond. L. D. Cull. Transmission chains and sprockets Staunton B. Peck, chairman. L. M. Wainwright. L. C. Wilson. Edgar Stilley. Weldless and hardware A. B. Way, chairman. T. B. Oliver. John M. Russell. Thomas A. Troy. Chemicals Central Committee Horace Bowker, chairman. Henry Howard. J. D. Cameron Bradley. Wm. Hamlin Childs. F. R. Grasselli. W. D. Huntington. D. W. Jayne. A. D. Ledoux. F. A. Lidbury. C. H. MacDowell. Edward Mallinckrodt, jr. Wm. H. Nichols. J. D. Pennock. C. L. Reese. John J. Riker. A. G. Rosengarten. C. G. Wilson. 533 Acids W. D. Huntington, chairman. S. B. Fleming^. J. M. Goetchius. C. F. Burroughs. J. H. D. Rodier. Charles M. Butterworth. Alkali J. D. Pennock, chairman. E. H. Hooker. N. E. Bartlett. E. Sargent. Coal-Tar By-Products D. W. Jayne, chairman. W. D. Addicks. C. J. Rarasburg. W. E. McKay. A. A. Schlesinger. Dyestuffs C. L. Reese, chairman. H. A. Metz, M. R. Poucher. R. W. Hochstetter. August Merz. H. D. Ruhm. I. F. Stone. F. M. Fargo. A. R. Curtin. J. M. Matthews. Electro-Chemicals F. A. Lidbury, chairman. C. D. Cohen. F. J. Tone. Fertilizer C. C. Wilson, chairman. C. F. Burroughs. W. D. Huntington. C. H. MacDowell. A. C. Read. Albert French. Porter Fleming. Wm. Prescott. Frederick Rayiield. Miscellaneous Chemicals A. G. Rosengarten, chairman. C. P. Adamson. Wm. Henry Bower. Foreign Pyrites A. D. Ledoux, chairman. C. F. Burroughs. F. H. Nichols. W. H. MiUs. Domestic Pyrites and Sulphur C. H. MacDowell, chairman. W. N. Wilkinson. H. P. Nash. C. G. Wilson. Wood Chemicals John Troy, chairman. F. E. Clawson. H. E. Gaffney. Children's Vehicles J. F. Vogel, chairman. C. R. Dinkey. Wm. L. Diemer. R. G. I^dip. F. £. Southard. «i 534 INDUSTRIAL AMERICA IN THE WORLD WAR l»* < 1 . I ; ( 1 / Vitrified Glazed Sewek Pipe and Clay Prod- ucts Fred L. Dickey, chairman. R. S. Rhodes. M. P. Chumlea. Vitrified Glazed Sewer Pipe A. C. McCombe, chairman. H. B. Manton. H. £. KUgus. Clothing Samuel Weill, chairman. Wm. Goldman. Chas. W . Endel. Herbert C. Ansorge. £dw. Rosenberg. Paul L. Feiss. Eli Strauss. Geo. M. Sherman. Ludwiff Stein. A. D. Peine. Henry X. Strauss. David Kirschbaum. Collapsible Tubes R. L. Kenah, chairman. A. H. Wirz. George H. Neidlinger. A. W. Paull. CoNFECnONERT V. L. Price, chairman. R. R. Cleeland. H. H. Harris. Frank £. Gillen. F. A. Chappell. W. C. Bidlack. Geo. E. Close. J. K. Farley, jr. H. W. Hoops. W. H. Belcher. Walter C. Hughes. Paul F. Beich. A. S. Colebrook. Cooperage Walker L. WeUford, chair- man. V. W. Krafft. E. H. Defebaugh. A. J. Poorman. Charles Hudson. W. Palmer Clarkson. F. S. Chariot. C. L. Harrison. Geo. H. Martin. W. K. Knox. C. F. Meyer. W. F. Wolfner. Corn Products W. G. Irwin, chairman. C. D. Edinburg. J. B. Reichmann. G. S. Mahanna. Corsets J. M. Ullman, chairman. Daniel Kops. W. A. Marble. R. C. Sterton. L. T. Warner. Nelson Gray. Cotton Manufacturing National Council Stuart W. Cramer, chairman. Edwin F. Green, vice chair- man. Winston D. Adams, secre- tary, Albert F. Bemis. Fuller E. Gallaway. D. Y. Cooper. PhUip Y. DeNormandie. Arthur J. Draper. Albert G. Duncan. Frank J. Hale. James D. Hammett. Allen F. Johnson. Gerrish H. Millikin. W. Frank Shove. Ellison A. Smith. War Serviee Committee Gerrish H. Millikin, chair- man. Arthur J. Draper, vice chair- man. J. S. Rousmanniere, secre- tary. Robert Amory. W. D. Anderson. J. Arthur Atwood. Howard Baetjer. Walter C. Bayliss. Harry H. Blunt. Bertram H. Borden. Arthur T. Bradlee. W. Irving Bullard. J. W. Cannon. B. B. Comer. J. W- Cone. Philip Dana. George A. DeForest. B. H. Bristow Draper. F. C. Dumaine. H. R. Fitzgerald. B. E. Geer. C. L. GiUiland. Henry S. Howe. George H. Lanier. J. H. Ledyard. Arthur H. Lowe. A. W. McLellan. Victor M. Montgomery. J. E. Osborn. Andrew G. Pierce, jr. John Skinner. Cotton Thread J. William Clark, chairman. W. H. Hall. H. £. Locke. Chas. Spicehandlef. W. W. Orswell. L. B. Cranska. C. £. Barlow. Cotton Waste Henry F. McGrady, chair- man. Joseph F. Wallworth. Samuel L. Ayres. Michael F. Dunn. Jas. F. McNeel. CxmTAINS George J. Martin, chairman. M. E. Wormser. D. C. Pierce. Pocket Knives Chas. F. Rockwell, chair- man. C. B. Butler. D. Divine, jr. Adolph Kastor. C. W. SUcox. Dental Manufacturing Frank H. Taylor, chairman. 7^' k' «'■'*'■' secretary. C. U. Rother. J. R. Sheppard. H. A. Slaight. £. £. Smith. S. Rubin. Drugs WiUard Ohliger, chau-man. Frank G. Ryan. Donald McKesson. Frederick G. Rosengarten. w. A. aailes. Burton T. Bush. Dr. H. C. Lovis. Milton Campbell. Dr. W. C. Abbott. Drugs (Proprietary) &*?^ ^ Blair, chairman. W. E. Weiss. A. H. Beardsley. Z. C. Patten, jr. E. K. Hyde. Loub Liggett. Drugs (Wholesale) F. £. Bogart, chairman. Jas. W. Morrison. H. D. Brewer. Terry T. Greil. C. F. Michaels. J. M. Penland. H. D. Faxon. Roblin H. Davis. W. V. Smith. C. S. Martin. C. E. Bedwell. W. G. Noyes. Wm. Scott. R. R. Ellis. C. P. Walbridge. Drugs (Retail) Eugene C. Brokmeyer, chair- man. James F. Finneran. Robert J. Frick. James P. Crowley. Theo. F. Hagenow. . Charles H. Huhn. Samuel C. Henry. Charles F. Harding. Dry Goods (Wholesale) Central Committee John W. Scott, chairman. Calvin M. Smyth. James M. Easter. Ernest W. Stix. Leon Smith. Arthur C. Farley. E. B. Snydor. Frank S. Evans. Dbt Goods (Wholesale) —Continued Svieommittee on Dress Fabrics H. Clay Miller, chairman. Colby Davics. R. B. Mc Kenny. D. W. Jarvis. W. F. Dalzell. Samuel D. French. Murray Brown. Fred T. Howard. Subcommittee on Knit Goods Chas. A. Jobes, chairman. John £. McLoughlin. D. J. Callaghan. J. H. Emery. A. Chas. Wilson. Subcommittee on Salesmen's Samples Ward M. Burgess, chairman. Bentley P. NefiF. W.R.King. Gaylord W. Gillis. I. M. Parsons. Subcommittee on Notions and Small Wares Jacob K. Lessey, chairman. Thos. C. Donovan. Julius Baer. J. Dey Conover. Harry Wheeler. Dry Goods (Retail) Victor W. Sincere, chairman. • M. L. Wilkinson. Oscar Webber. S. J. Schwartz. H. A. Saks. Sanitary Earthenware J. A. Campbell, chairman. A. M. Maddock. Philip J. Flaherty. Electric Railways Thos. N. McCarter, chair- man. Arthur W. Brady. Britton I. Budd. Philip H. Gadsden. Lucius S. Storrs. Electrical Manufac- turing Central Committee Clarence L. Collens, 2d, chair- man. James C Hobart. J R. McKee. William Wallace Nichols. Robert K. Sheppard. Charles A. Terry. Electrical Apparatus Clarence L. Collens, 2d, chair- man. F. S. Hunting. T. £. Barnum. H. C. Petty. Walter J. Friedlander. H. G. Steele. APPENDIX Electrical Supplies R. K. Sheppard, chairman. J. F. Kerfin. W. M. Stearns. H. R. Holmes. W. W. Mumma. J. M. Woodward. H. W. Bliven. J. B. Adams. Herman Plaut. H. G. Lewis. C. £. Corrigan. F. W. Hall. H. W. McCandless. R. W. Seabury. W. H. Thornley. H. D. Betts. Chas. L. Eidlitz. D. H. Murphy Wallace S. Clark. J. C. Dallam. Charles G. Rupert. W. Roy McCanne. Electrical Supply Jobbers £. C. Graham, chairman. J. G. Johannesen. W. F. P. Mayo. E. W. Rockafellow. £. F. Smith. Elevators Martin B. McLauthlin, chair- man. /V« 15 • OCC* I. B. Houghton. George T. Marshall. F. A. Hecht. C. H. M. Atkins. Enameled Ware George D. Mcllvaine, chair- man. Jas. F. Conran. A. H. Cline. jr. J. E. Murphy. T. R. Barnes. Engineering Clemens Herschel, chairman. Benj. B. Thayer. I. E. Moultrop. Calvert Townley. Civil Chas. S. Churchill, chairman. Prof. Geo. F Swain. Prof. F. H. NeweU. Alex. C. Humphreys. C. F. Loweth. Electrical Harold W. Buck, chairman. E. W. Rice, jr. N. A. Carle. Prof. C. A. Adams. Charles £. Skinner. Mechanical Dr. Ira N. Hollis, chairman. Chas. Whiting Baker. George J. Foran. Chas. T. Main. Dr. D. S. Jacobus. 535 Mining P. N. Moore, chairman. Sidney J. Jennings. Benjamin B. Lawrence. J. Parke Channing. Edwin Ludlow. Photo-Engraving Chas. W. Beck, jr., chairman. E. W. Houser. Ad. Schuetz. F. W. Gage. A. D. Sher'dan. H. C. C. Stiles. S. E. Blanchard. J. C. Buckbee. Don Seitz. Matthew Well. W. J. Lawrence. E. C. MUler. Fabricated Steel John Sterling Deans, chair- man. Lewis F. Rights. Geo. P. Bard. Thomas Earle. Howard A. Fitch. W. A. Garrigues. £. A. Gilbert. J. L. Kimbrough. C.D.Marshall. Wm. S. Simpson, jr. H. A. Wagner. Paul Willis. C. Edwin MichaeL Farm Implements C. S. Brantingham, chair- man. F. R. Todd. G. A. Ranney. H. M. Wallis. W. H. Stackhouse. Wagons and Vehicles R. V. Board, chairman. H. J. McCullough. T. A. White. A. B. Thielens. Felt W. A. Forman, chairman. H. M. NichoUs. John M. Richardson. J. C. Collins. G. M. Graves. Fiber Containers Frederick A. Norris, chair- man. Chas. R. White, secretary. J. P. Brunt. J. P. Hummel. Thos. W. Ross. J. B. Fenton. Geo. W\ Gair. Flavoring Extracts S. J. Sherer, chairman. Frank L. Beggs. Chas. D.Joyce. W. M. McCormick. T. W. Carman. ir 536 INDUSTRIAL AMERICA IN THE WORLD WAR l"« Hi ^\ Food Specialties Wm. L. Sweet, chairman. Frank H. MiUaxd. R. R. Moore. Walter H. Lipe. Walter B. Cherry. Carl A. Lautz. Fred Mason. A. M. Alexander, C. M. Rich. C. F, Mueller, jr. A. C. Monaglc. E. G. McDougall. C. T. Lee. Dr. T. B. Wagner. Geo. H. Carter. Arthur B. Williams. Louis Runkel. D. O. Everhard. Foundry Products H. D. Miles, chairman. G, H. Clamer. J. C. Haswell. Ralph H. West. C. E. Hoyt. Foundry Supplies Ralph Ditty, chairman. Theodore Kauffman. W. F. Kainc. £. J. Woodison. H. M. Bougber. Fur Samuel Ullman, chairman. Charles W. Gordon. A. B. Shubert. P. B. Fouke. Antonin Chapal. F. N. Monjo. Max Cohen. Aaron Naumburg. Otto J. PieUcr. Garments Galbraitb Miller, jr., chair- man. A. T, Davenport. I. L. Phillips. Ralph Hunter. John L McDonald. C. C. Overton. Gas and Electric Service John W. Lieb, chairman. Geo. W. Llliott, secretarv. W. IL Gartlcy. Walter R. Addicks. Philip P. Barton. H. G. Bradlee. John A. Britton. Alex. Dow. Chas. L. Edgar. ' A. E. Forstall. Jos. F. Guffcy. Saml. Insull. D. C. Jackson. Joa. B. McCall. Capt. Wm. E. McKay. Herbert A. Wagner. S. S. Wyer. Gas Engines H. G. Diefendorf, chairman, Rufus K. Schriber. Geo. W. Schwer. G. F. Fithian. C. B. Segner. C. Hcer. Walter Brown. Geo. Hanson. Lester H. Keim. Lester S. Keilholtz. C. E. Bement. G. L. Lewis. Carl Velguth. Gears F. W. Sinram, chairman. Henry E. Eberhardt. Frank D. Hamlin. Milton Rupert. George L. Markland, jr. Frank Burgess. E. J. Frost. H. W. Chapin. William Ganschow. Window Glass W. L. Monro, chairman. C. W. Brown. H. J. Walter. H. R. Hilton. U. G. Baker. Grain Dealers and Exchanges C. B. Pierce, chairman. G. F. Ewe. E. S. Westbrook. John O. Ballard. John H. MacMillan. Herbert Hall. Chaa. D. Jones. Hiram N. Sager. O. M. Mitchell. Geo. E. Pierce. E. C. Elkenberry, Frank I. King. E. M. Wayne. E. A. Fitzgerald. E. W. Crouch. U. F. demons. A. E. Reynolds. F. C. Van Dusen. Granite Paving Blocks H. E. Fletcher, chairman. C. Harry Rogers. Joseph Leopold. Wm. Booth. W. F. Shaffner. Alfred T. Rhodes. Grinding Wheels Carl F. Dietz, chairman. Geo. R. Rayner. L. T. Byers. E. Bertram Pike. Frank R. Henry. Groceries (Wholesale) Wm. L. Juhring, chairman. John C. Mablan. H. J. Sills. C. Schuster. George Bochm. Frank Depew. John C. Dorn. Metal Gauge t" ?• ^if'^Patrick, chairman. J. A. lilden. T. C. Clifford. A. A. Ainsworth. Hardware Hardware Manufacturers Or- ganizationfor War Service President Charles W. Asbury. Assistant Executive Manager ". H. Robinson. Secretarjf- Treasurer F. D. Mitchell. Executive Committee Fayette R. Plumb, chairman, rrank Baackes. A. W. Stanley. Subcommittee on Wire and Heavy Hardware Chas. E. Sanders, chairman. James Hay. Wm. M. Taussig; W. J. McCurdy. Warren D. Chase. W. H. Remmel. W. D. Biggers. John A. Moore. H. F. Sevnour. Frederick Pease. Wm. Jennings. Geo. H. Kennedy. Subcommittee on Builders Hardware and Small Cast' tngs H. B. Sargent, chairman. H. C. M. Thomson. Albert Zimmerman. • W. P. Benson. F. A. Searle. H. B. Plumb. E. H. Stearns. Subcommittee on Tools for Woodworking H. B. Curtis, chairman. Charles C. Haselton. H. B. Curtis. W. C. Kelly. Wm. M. Pratt. R. E. Maher. Paul E. Heller. Wallace L. Pond. Chas. F. Griffith. Wm. Morrill. Irving S. Kemp. Fred Buck. J. B. Wilbur, jr. J. L, Jennings. S. Horace Disston. Subcommittee on Tools for McU.l Working Frederick L. Payne, chair- man. L. F. Fichthorn. A. E. Woodruff. Wm. M. Pratt. D. Findlay. George Butterfield. F. G. Echols. Frank L. Coes. J. H. Williams. J. E. Durham. Jas. Gcddes. E. S. Miller. F. O. Wells. H. S. Ashman. Hardware — Continued Subcommittee on Agricultural Tools J. S. Bonbright, chairman. Ed. S. Burt. W. H. Cowdery. C. S. Phillips. Subcommittee on Cutlery Chas. F. Rockwell, chairman. R. F. Chatillon. P. Van .\lstyne. O. W. Edwards. W. W. Page. C. L. Gairoard. Subcommittee on General 5tip- plies E. Bertram Pike, chairman. E. C. Hough. A. J. Crandall. L. P. Smith. H. E. Smith. C. Heinrich. Hardware Jobbers (Southern) Charles H. Ireland, chairman. Oscar B. Barker. John Donnan. Men*8 Straw ELats Charles H. Watson, chairman^ Daniel G. Tenney. S. George Wolf. Fred G. Phelps. Fletcher H. Montgomery. Robert J. Patterson. Hats (Wholes.\le) R. T. Langenberg, chairman W. H. Ferry. Robert J. Patterson. Charles Watson. Fred Berg. Hosiery W. B. Davis, chairman. E. B. Gaylord. C. L. Perkins. P. C. Withers. W. H. Ziock. T. F. Theime. H. T. Rollins. W. H. McLeUan. J. L. Johnson. J. O. Wells. F. A. Patrick. A. W. Sulloway. C. W. Kilbourn. F. L. Chipman. Charles W. Adler. Jos. S. Rambo. Edward Powell. Robert C. Blood. W. Park Moore. Gustav Oberlaender. George D. Horst. Chas. E. Leippe. Shepard Nicholson. Garnett Andrews. C. A. Plumley. L. B. Conway. R. N. Kimball. L. Heilbronner. APPENDIX Underwear Hewitt Coburn, jr., chair- man. A. C. Dunhan. L. W. Tiffany. B. C. Stephenson. J. C. Roulette. C. P. Baker. Chas. L. Macomber. C. F. Winship. D. L. Galbraith. E. A. Clements. Myron H. Pi well. F. M. Stowell. Nathan Hatch. John K. Stewart. Marshall Ely. F. B. Harder. S. Wright, jr. Rodney W. Jones. Andrew Frey. F. W. Kavanaugh. W. C. Ruffin. P. H. Hanes, jr. L.F. Flesh. F. M. Shipley. J. L. Black. Joseph Feldenheimer Benj. Gibbs. Roy W. Lotspeich. H. S. Cooper. S. D. Bausher. Sweater Coats William H. Wye, chairman. A. W. Spalding. Isaac Roff. C. T. Hays. H. Friedman. H. T. BaUard. Frederick Mayer. G. H. Packard. W. B. TyreU. Otto A. Finck. Hospitals Dr. S. S. Goldwater, chair- man. Richard P. Borden, secretary. Daniel T. Test. A. A. Warner. Dr. Wm. A. White. Ice Harry Hammond, chairman. Wm. E. Zieber. J. C. Kent. M. J. O'Connell. 537 Printing Ink C. F. Bower, chairman. L. A. Ault. James A. Ullman. K. W. Harden. Philip Ruzton. Iron and Steel Central Committee Elbert H. Gary, chairman. James A. Farrell, vice chair- man. James A. Burden. Alva C. Dinkey. Willis L. King. E. J. Grace. Charles M. Schwab. John A. Topping. Central Commitlee—Con. H. D. Dalton. A. F. Houston. J. A. Campbell. L. E. Block. £. A. S. Clarke. W. H. Cook. Steel Distribution J. A. Farrell, chairman. J. B. Bonner, vice chairman. E. A. S. Clarke. John A. TopDincr. F.J.Hall. W. L. Hoffman. O. P. Blake. H. F. Holloway. Alloy* James A. Farrell, chairman. E. A. S. Clarke. E. G. Grade. £. J. Lavino A. A. Fowler. Sheet Steel W. S. Horner, chairman. Walter C. Carroll. Charles O. Hadley. Pig Tin John Hughes, chairman. E. R. Crawford. John A. Frye. A. B. HaU. Theodore Pratt. Scrap Iron and Steel W. Vernon Phillips, chair- man. Scrap dealers Charles Driefus. Joseph Michaels. Eli Joseph. C. A. Barnes. H. B. Spackman. W. M. Tobias. Charles E. McKiUips. Iron bar manufaeturert John C. Brown. Walter C. Ely. Rail reroUert D. C. Schonthals. Arthur S. Hook. Steel foundries and electric fur* naees Theodore E. Morritz. Rodney Thayer. Crucible steel makers J. S. Pendleton. Gray iron and malleable foun- dries Benjamin D. Fuller. Pig Iron Ore and Lake Trant^ portation H. G. Dalton, chairman. D.Billings. H. Coulby. C. D. Dyer. Leonard Peckitt. F. B. Richards. W. T. Sheppard. A. H. Woodward. Amaza S. Mather. 538 INDUSTRIAL AMERICA IN THE WORLD WAR i m I ,1 I ' '»! # I Iron and Steel — Con. Tin Plate J. I. Andrews, chairman. E. R. Crawford. E. T. Weir. Malleable Cariinge Frank J. Lanahan. chairman. H. F. Pope. J. C. Haswell. F. L. Sivyer. Frederick Fraser. Wire Roj)e Karl G. Roebling, chairman. John J. Broderick. Frank Baackes. Wire Products F. Baackes, chairman. George A. Mason. John C. Neale. J. E. Frederick. H. Sandborn Smith. Cold Rolled and Dratcn Steel F. N. Beegle, chairman. E. L. Parker. Roland Gerry. Tubtdar Products Jas. A. Campbell, chairman. Anson Mark. George Matheson. W. H. Rowe. E. Wircester. H. A. Beale, jr. L. M. Johnson. Iron, Steel and Heavy Hardware (Jobbers) Samuel L. Orr, chairman. Chas. M. Roehm. Jas. A. Coe. Jewelers Robert B. Steele, chairman. George H. Wilcox. George E. Fahys. David Belais. Col. Harry L. Brown. John S. Holbrook. W. F. Juergens. Herbert L. Farrow. Rolland G. Monroe. Wilson A. Streeter. Harold E. Sweet. Fred G. Tbearle. J. S. Van Wezel. Henry Wolcott. Jewelers (New Eng- land) Louis Lyons, chairman. Maurice J. Baer. Harry Fulford. Stephen H, Garner. Geo. H. Holmes. Frederick A. Howard. Harold W. Ostby. Harold E. Sweet. Henry B. Thresher. Chas. A. Whiting. Henry Wolcott. Woodward Booth. Sterling Silver and Sil- ver Plate Ware Geo. H. WiJcoz, chairman. H. B. Dominick. F. A. Wallace. J. Wayland Smith. Frederick Webster. John S. Holbrook. H. H. Tredwell. W. A. Kinsman. Andrew Snow, jr. Cleveland A. Dunn. Jewelers' Vigilance Committee Harry C. Larter, chairman. Geo. E. Wilcox, vice chair- man. Geo. E. Fahys. - David Belais. Col. Harry L. Brown. O. G. Fessenden. John S. Holbrook. W. F. Juergens. Herbert L. Farrow. Rolland G. Monroe. Wilson A. Streeter. Harold E. Sweet. Fred. G. Thearle. J. S. Van Wezel. Henry Wolcott. Lime Chas. C. Bye, chairman. J. K. Barbour. £. R. Stapleton. J. L. Durnell. Charles R. Leo. Henry Angel. A. H. Lauman. Employing Lithogra- phers Wm. S. Forbes, chairman. Herbert H. Bigelow. Walter Clothier. Joseph Deutsch. Charles R. Frederickson. W. A. Livingstone. Earl H. Macey. George R. Meyercord. William Monasch. Alfred B. Rode. Maurice Saunders. Harry C. Stevenson Jacob A. Voice. Lumber Oeorgia-Florida Yellow Pine M. L. Fleishel, chairman. J. E. Graves. E. V. Dunlevie. R. M. Bond. R. H. Paul. D. G. Goit. H. R. Swartz. Mieeissippi and Alabama N. S. Curtis, chairman. M. C. Lumley. S. S. Stuckey. North Carolina Pine A. M. Cooke, chairman. R. J. Clifford. Gilbert L. Hume. J. W. Foreman. Nathan O'Berry. Claude Kiser. Lumber — Continued Northern Pine George F. Lindsay, chair* man. R. E. McLean. R. R. Bailey. Southern Pine W. H. Sullivan, chairman. F. W. Stevens. John L. Kaul. C. A. Buchner. R. M. HallowelL V. M. Scanlon. M. B. Nelson. D. V. Dierks. T. L. L. Temple. W. M. Cady. W. B. Patterson. F. L. Sanford. Lumber (Wholesale) Edward Eiler, chairman. £. H. Stoner. Max Meyers. Thomas E. Coale. H. W. McDonough. R. R. Sizer. B. H. Ellington. Machine Tools C. Wood Walter, chairman. Chas. E. Hildreth. A. £. Newton. Malt G. W. Hales, chairman. Oscar J. Ruh. Fred Vullmahn. Albert Zinn. Phil. A. Grau. Marble (Dealers) Charles L. Hilgartner, chair* man. Capt. Ed. R. Morse. Col. Sam. Tate. J. J. McClymont. Surgical Instruments and Medical Trade Supplies (Retailers) Wm. Gibson, chairman. J. F. Hartz. E. F. Mahady. Mill and Mine Supplies and MACHINERy (Dealers) Ernest Howell, chairman. J. G. Bel ding. J. H. Haslam. W. Marshall Turner. Milling Jas. F. Bell, chairman. Fred J. Lingham. E. M. Kelly. Mark Mennel. Bernard A. Eckhart. Saml. L. Plant. A. J. Hunt. Theodore B. Wilc J Chambers, Edward, Pnonties Board, 146 n., 468, 511. Channing, H. M., Legal Section, 207 n 'll 2 Chase, M. F., FacUities Division, 199; Explosives Division, 403, 512; serv- ices, 419. Chase, W. W., priorities, 146 n., 512. Chatillon, G. E., Optical Glass SecUon, 471.512. . , J . Chavannes, F. S., regional advisor, 508,512. . ^ . Chemical Alliance, as mdustries com- Chemical Glass and Stoneware Sec- tion, 418, 503. „ . ^ , Chemical Warfare Service, demands, 416. Chemicals, cooperaUve committee, 496; early subcommittee, 496; war service committees, 533. iSee also next title. Chemicals Division, war minerals un- der, 377; Ferro- Alloy Section, 384; mica, 385; chlorine. 400, 419; acet- ylene and oxygen, 415; creosote, 415; tanning, 415; paints and pig- ments, 415; wood distillation prod- ucts, 415, 516; arsenic, bromme, camphor, wool grease, 416; clays, 417; electrodes, abrasives, 417; glass and stoneware, 418; Technical and Consulting Staff, research, 418, 419; industries committees, 419, 496, 533; services, 419; sections, per- sonnel, 503, 504. See also Asbestos; Dyes; Explosives; Nitrates; Potash. Chemistry, and World War, 89. Chicago, and restriction of buildmg, 188, 339; regional advisor, 508. Children's vehicles, war service com- mittee, 533. Chile, American influence over, 262. See also Nitrates. China, antimony from, and sdver for, 357, 358. Chlorine, war demand and conditions of mdustry, 400, 419; Section, 503. Chloroform, war-time problem, 416. Christie, G. I., War Labor Pohcies Board, 288. Chromium, uses, foreign sources, 378; domestic production, stimulation, 378-81 ; prices, supply, 379. Churchill, Winston, and Foreign Mis- sion of War Industries Board, 268, 270; and nitrates, 393. Cincinnati, regional advisor, 508. ^ Clapp, A. W., Labor Priorities SecUon, 291 512. Clark,' E. E., committee on transporta- tion, 81. . T. J Clark, H. T., in War Industries Board, 61, 501, 512. ^ , . Clark, LeRoy, clearance for electric wire orders, anomalous committee, 115, 116; Wire Section, 463, 512. Clarke, E. A. S., and steel prices, 322; steel committee, 325. Clarkson, C. F., Automotive Products ^lection 466. Clays, refractory products, porcelains, 417. Clearance, development by War In- dustries Board, 45, 61, 62; auto- matic data for, 114; first attempts, 114; manufacturers' volunteer, 114, 115; through commodity sections, 116, 117; failure of general commit- tee, 116, 117; Clearance Office as I distributing center, value, 117; ex- I n I r I 550 INDEX ]*•' ' tension, process, 118; personnel, 118, 502; purpose, results, efficiency, 118-20; interdepartmental of sur- pluses, 195; work of Facilities Divi- sion, 198. See also Priorities. Cleveland, regional advisor, 508. Clocks, conservation, 223. Clothing, committee in Advisory Com- mission, 29; conservation, 220, 223 224; reclamation, 279; and dye con- servation, 414; war service com- mittee, 534. See also Dyes; Textiles. Coal, price-fixing, 167; war situa- tion described, 336. See also Fuel Administration. Coal-tar (gas) derivatives, for explo- sives, German supremacy, 404, 405- development, 413, 414; cooperative committee, 496; Section, personnel, 503. See also Dyes; Explosives. Cotlm, H. E., and pre-war industrial preparedness, 13; Advisory Com- mission, committee, 22, 29; General Munitions Board, 35; and cylinder- gnnders, 454; and aircraft, 465; and automotive transport, 466. Coffins, conservation, 223. Cdke, price-fixing, 167 n. See also Coal-tar derivatives. Collapsible tubes, conservation, 223, 368; war service committee, 534. Collective bargaining, recognition rec- ommendation, 284. See also Labor Colombia, platinum supply, 370, 373. Colver, W. B., Price-Fixing Com- mittee, 170, 512; Pulp and Paper Section, 428. Combinations. See Anti- trust laws; Industrial mobilization. Commandeering, abuses. War In- dustries Board and coordination, ■ 103; pnce-fixing and, 177; industrial, by military departments, 177 n. Commercial economy, committee in Council of National Defense, 37. Commercial Economy Board. See Conservation. Commercial fixtures, war service committees, 543. Committees, first of Advisory Com- mission, 28, 29; sub- and cooperative of raw materials committee, 29, 495- 500; in General Munitions Board, 35; system as retard, 36, 51; under Council of National Defense, 37. See also War service industries com- mittees, and cross-references under Commodities sections and War In- dustries Board. Conunodity sections, development, system, 45, 61, 301-^5; and clear- ance, 116, 117; and data, 136, 201, | 307-09; and administration of prices, 178; specialized functions, 182; clearmg house for, on building and materials, 196; Statistical Sec- tion, 202; and work of conversion, 240; as heart of War Industries Board, 240; character, importance, as reversible taps, 299-301; results, and war industries committees, 301- 03; assembly, 305; list, personnel, 306 n., 503-07; lodgment of power, composition, 307; efficiency, 309, 474; simplicity, 310; power, as mini- atures of War Industries Board, 311; and business in Government, 311-14- peace adaption of idea, 486; dis- solve, 486. See also Building mate- rials; Chemicals Division; Chains; Cranes; Ferro-alloy metals; Hard- ware; International executives; Leather; Lumber; Machinery; Med- ical mdustry; Non-ferrous metals; Optical glass; Power and trans- portation; Pulp and paper; Rubber; Steel; Textiles; Tobacco; War In- dustries Board; War Service Com- mittees. Competitive bidding, war discard, 156. Confectionery, war service conmiittee, 534. Congestion, sectional industrial, 199 234, 235, 453. See also FacUities Division. Congress, and public opinion, 10; Council of National Defense^ 15-21 491, 492; National Defense Act (1916), 18, 19; and power of War Industries Board, 19, 20, 94-97; and first war estimates, 33, 34; Overman Act, 58, 97, 100, 493; and price-fix- mg, 166; and restriction of building, 188; platinum licenses, 373; War Minerals Stimulation Act, 374, 380- nitrate plants, 389; post-war neglect of industrial preparedness, 396, 483 Connor, C. H., Platinum Section, 372, 512; Wood Chemicals Section, 415 n., 512. Conservation, development by War Industries Board, 45, 61, 62; and priority demands, 181; purpose and pohcy of Division, 181, 209; Divi- sion and Division of Planning and Statistics, 182; Division and interde- partmental clearances, 195; public contact, 210, 213; origin. Commer- cial Economy Board, A. W. Shaw, 210-12, 228; independence of Board, 212; personnel, 212, 502; elimination of br^d-retum privilege, 213; princi- ple of voluntary cooperation, suc- INDEX 551 cess, 214, 215, 229; retail deliveries simplified, 216; economy in packing and transportation, 216, 217; retail store exchange abolished, 216; in- dustrial reforms, elimination of wasteful methods, 217; lines of elimination and substitution, 219; "schedules," method, 220; illustra- tions, 220-25; manufacturers and lesson, question of permanent gain, 225, 230; and military goods, 225, 226; and curtailment of output, automobiles, 226, 227; and other activities of War Industries Board, 227; efficiency of American, 228; Exjonomic Intelligence Section, 228; sanity, and "forgodsakers," 229; element in Labor Division, 278; steel, 328; lead, 360; platinum, 373; dyes, 414; lumber, 426; paper, 429; building materials, 430; in power, 461-63; medical industry, 472. See also Conversion; Non-War Con- struction Section; Priorities. Conspectus periodical, 203, 204. Construction, cantonments, 171-74, 196, 197, 420, 421; vastness of war, 422; standardized schedules, 431; war service committee, 533. See also Building materials; Emergency Construction Committee; Non-War Construction Section. Contracts, post-war repudiation, '484. Conversion, industrial essentiality and, 184; illustration, 193; military, 232; in French shell production, 232; reason for slowness of American, 233, 234, 452; survey, 234; and sec- tional allocation, 234, 235, 241; and question of complementary or uni- tary American war participation, 235-38; lack of system in early at- tempts, 239; Industrial Representa- tive, duties, 239; work of commodity sections, 240; Section of Resources and Conversion, Otis as head, per- sonnel, 241, 243, 506; regional indus- trial integration and advisors, list, 241-43, 508; regional committees as local war industries boards, 243, 245; local and central cooperation with other boards, 243; scope of Sec- tion, 244; service and method of Section, 244, 248; method and indus- trial support, 245; and Facilities Division, 245, 246; and "organiza- tion," 247; specimen conversions, 248; and international centralized industrial control, 275; in steel in- dustry, 326; in automobile industry, 342 n., 343, 467; in textiles, 443, 447, 450; in machinery, 454; in crane manufacture, 456; in making small locomotives, 469. Cook, H. H., steel committee, 326. Cooke, A. M., Lumber Division, 427, 512. Cooke, M. L., and training employ- ment managers, 290. Coolidge, L. A., labor committee, 283. Coonley, Howard, War Labor Policies Board, 288. Cooperage, war service committee, 534. Cooperation, spirit in industrial mo- bilization, 37, 114, 115, 126, 131, 152, 154, 159, 215, 243, 360, 424. 455. See also Industrial mobiliza- tion; Price-fixing; War Industries Board; War service industrial com- mittees. Cooperative committees of raw ma- terials under Advisory Commission, personnel, 29, 495-500. Copeland, M. T., Commercial Econ- omy Board, 212. Copper, voluntary price-fixing, 162, 346-48; war importance and uses, 345; contest between German stocks and American mines, 345, 346; later price negotiations and agreements, pool, 349-52; Trade Commission's report, 350; later advance, 352; co- operative committee, 351, 496, 497; control under agreement, 352; Non- Ferrous Metals Division, personnel, 352, 505; no shortage, 352, 353; al- loys, 353. See also Brass. Cordage, war problem, 451; Section, 505. Cork, war problem, 451. Com products, war service committee, 534. See also Food Administration. Cornell, I. H., Foreign Mission, 273, 512; Non-Ferrous Metals Division, 352, 512; lead allocations, 360. Coronel, battle of, cause, 388. Corsets, war-time, 221, 328; war serv- ice committee, 534. Cost-plus policy, defects, 171-74; in cantonment building, 196, 197; and steel prices, 322. Cotton, D. R., regional advisor, 508, 512. Cotton, and price-fixing, 179, 180, 448; Section, personnel, 442 n., 506; cot- ton waste war service committee, 534. Cotton goods, Section, personnel, 441, 506; character of problem, 446; gov- ernmental requirements, 446-48; early service committees, 447, 448; trade and governmental orders, con- versions, 447, 448; period of army 552 INDEX s 1 I 1 ♦ •/ administration, 448; price-fixing, 448; war service committee, 534. See also Textiles. Cotton linters, war demand and con- [ trol, international pool, 401; Sec- tion, personnel, 442 n., 506. See also Explosives. Couden, A. R., Advisory Committee on Plants and Munitions, 191. Council of National Defense, develop- ment of idea, 11, 17, 18; develop- ment of measure, 14-17, 19; GifTord as director, 17; original purpose, ef- fect of war, 20-22; and its Advisory Committee, 23; and industrial dic- tatorship, 28; and beginning of in- dustrial conferences, 28; General Munitions Board, 34-36; estab- lishes War Industries Board, 36-38; - committees, 37; War Council, 43; and priorities, 143; on Price-Fixing Conmiittee, 169; and conservation, 210-12; expenditures, 254 n.; and labor, 280, 283, 285, 286; and post- war readjustment, 487; text of act creating, 491, 492. See also Advisory Conmiission. Crabbs, F. D., regional advisor, 508, 513. Cradock, Sir Christopher, battle of Coronel, 388. Crampton, H. E., and measure for Council of National Defense, 15, 16. Crane, C. H., lead industry committee, 360. Cranes, story of sidetracked gantry, 455, 456; Section, head, 456, 504; demand and supply, allocation, con- version, 456. Creosote, war problem, 415; Section. 503. Crockett, E. D., Machine Tool Section, 453 n., 513. Cromwell, lincohi. Knit Goods Sec- tion, 442, 513; work as head of early service committee, 449, 450. Crowder, E. H., and troop require- ments, 134; and priorities, 148, 292. Crozier, William, and preparedness, 11; and alteration of Enfield rifle, 191; and nitrates, 389; and smoke- less powder manufacture, 408, 409 n. Cuba, manganese, 378. Curtains, war service committee, 534. Cyclops, loss, manganese cargo, 378. Cypress Emergency Bureau, 424 n. Czecho-Slovak army in Russia, suo- phes for, 194. ^ Dallas, r^onal advisor, 508. Dalton, H. G., steel conunittee, 326. Damages, through priorities, 207. Dame, F. L., Facilities Division, 199. 513. Darling, I. C, Creosote Section, 415 n., 513. Dariington, Frederick, Power Section. 460, 513. Data, industrial, pre-war inventory, 13, 14, 136, 137; inadequate, effect, 114, 205; automatic provision, 114; steel survey, 125, 326; function of War Industries Board, 136, 137, 479; survey by Fusion Committee, 205; and preparedness, 230; conver- sion survey, 234; assemblage by commodity sections, 307-09; on knit goods, 449; card system in Machine Tool Section, 454; section in Chemi- cals Division, 504. See also Division of Planning. Davis, Arthur, and aluminum war industry, 356. Davis, C. B., Power Section, 460, 513. Decentralization, industrial, effect, 6, 51-53. Deeds, E. A., and cylinder-grinding j machinery, 454. Deliveries by stores cut, 216. Demand. See Requirements; Supply and demand. Dennison, H. S., Division of Planning, 202, 513; Conunercial Economy Board, 212. Dental manufacturing, war service committee, 534. Denver, regional advisor, 508. Department of Agriculture, War La- bor Policies Board, 288; and fer- tilizers, 389, 393, 395. Department of Conunerce, and Re- quirements Division, 127; utilizes lessons of War Industries Board. 484, 485. Department of the Interior, and war- time mineral development, 385. See also Lane, F. K. Department of Justice, and conspectus periodical, 204. Department of Labor, and conspectus periodical, 204; lack of machinery for war conditions, 284; new war- time agencies, 289. See also War Labor Administration. Department of Munitions, proposed, and War Industries Board, 8, 80. Designs, conservation in industrial. 219, 224. Detroit, regional advisor, 508. Dickinson, W. B., Facilities Division. 199. Dillon, Clarence, in War Industries Board, 61, 501, 513. Dinkey, A. C, steel conmiittee, 326. INDEX 553 Director of Purchase, in army, 130. Disarmament, and preparedness, 231. Disque, B. P., Fir Production Board, 427. Ditforth, W. L., Machine Tool Sec- tion, 453 n., 513. Diversion, of war purchases of Allies, 262,357. Division of Planning and Statistics, in War Industries Board, personnel, 61, 136, 137, 201, 202, 502; status, 181, 182; origin, 200, 201; purpose, sections, 201, 202; conspectus periodical, value, 203, 204; and marine facility and requirement, 204; special investigations, 205; book on war prices, 205; readjust- ment work, 205. Division of Purchase, Storage, and Traffic in General Staff, 131. Divisions of War Industries Board, list, personnel, 306 n., 501-03. Dodd, E. M., Jr., Legal Section, 207 n., 514. Dodge, John, on automobile industry and war, 334, 335. Dollar-a-year men, services, 77, 78. Domestic Hides and Skins Section, 434. Domestic Wool Section, 442 n., 507. Donlin, John, Emergency Construc- tion Committee, 197, 514. Donnelley, T. E., Pulp and Paper Division, 429, 514. Dorsey, G. D., Tm Section, 367. Douglas Spruce Emergency Bureau, 424/1. Downey, J. I., Facilities Division, 199, 514. Downman, R. H., and lumber price, 425; Building Materials Division, 427, 514. Draft, priority power and, 148, 292; future industrial, 482. Draper, F. W., platinum import, 370, 371. Dresses, Paris and conservant styles, 220. iSee a&o Textiles. Drugs, war service committee, 534. iSee also Chemicals Division. Dry goods, war service committees, 534, 535. See also Textiles. Du Bois, H. C, Electrodes Section, 417 71. 514. Dunn, H. T.. Rubber Section, 438, 442 n., 514. Du Pont American Industries, and cotton linters, 401. Du Pont Nitrate Company, and im- port, 392 n. Dupont Powder Company, and toluol, T.N.T. plant, 91, 404; and sulphuric acid, 399; and smokeless powder, contract, 407-10. Durant, E. W., and automobile in- dustry and war, 335. Dutch East Indies, tin, 269, 365, 366. Dyes, German monopoly, 412; devel- opment in United States, 413; and intermediates, control, 413; Section, 413 n., 503; conservation, 414; prob- lem of natural, 415. Dynamite, as war discard, 406. Easley, R. M., labor executive com- mittee, 282. Elconomic balance, world, upset, 250, 259; American world-wide control, 261, 262. See also Foreign Mission. Economic Intelligence Section, work, 228. Edgar, Charles, in early lumber sec- tion, 421, 424; Lumber Division, 426, 514; and crooked jobbers, 427. Edison, T. A., Naval Consulting Board, 12. Editorial Section of Division of Plan- nmg, 202. Education, committee in Advisory Commission, 29, 37. Einig, A. B., Machine Tool Section, 453 n., 514. Eisendrath, W. B., Leather Division, 434, 514. Eisenman, Charles, textile regulation, 440, 441. Electric railways, war service com- mittee, 535. Electric wire and cable, anomalous clearing committee, 115, 116. Electrical and Power Equipment Sec- tion, problems, 461, 463. Electrical supplies, war service com- mittees, 535. Electricity. See Power and transporta- tion. Electrochemicals, cooperative com- mittees, 496. Electrodes and Abrasures Section, war problem, 417; personnel, 417 n., 504. Electro-Metallurgical Company, and ferro-zirconium, 383. Elevator manufacture, conversion to recuperators, 193. Elevators, war service committee, 535. Elimination of industrial waste, lines, 219. See also Conservation; Conver- sion. Ellsworth, E. K., disburser, 254 n. Elton, J. P., brass industry committee, 353, 514. Ely, Grosvenor, Cotton Goods Section, 442, 514. I 554 INDEX f V i Emergency Construction Committee, work, personnel, 182, 196, 197, 504. Emergency Fleet Corporation. See Shipping Board. Emergency Shipping Act, and War Industries Board, 96. Emery, war problem, 418. Employment agencies, war time pri- vate, 285; federal, rules, 289; train- ing managers, 290. Employment Management Courses Section, personnel, 208, 290, 502. Enameled ware, war service com- mittee, 535. Enfield rifle, justification of alteration. 191. En^neer Corps, and power construc- tion, 460. Engineering, committee in Advisory Conmaission, 29, 37; war service conomittees, 535. Envelopes, war service committee, 542. Esberg, A. I., Tobacco Section, 474, 514. Espionage Act, and War Industries Board, 97. Essential industries. See Conversion; Priorities; Requirements. Etherington, Burton, Cotton Goods Section, 442, 514. Ettinger, A., Legal Section, 207 n., 514. Exchanges at retail stores, abolished, 216. Explosives, chemistry and modem war, 397; sulphuric acid materials, con- trol, 397, 398; manufacture of sul- phuric acid, prices, 398; caustic soda, 399, 400; soda ash, 400; al- cohol, 401; cotton linters, 401; toluol and anmionia, T.N.T., 402, 404, 414; American oflTset contribu- tion to Allies, 402, 408; interest of War Industries Board, Division, 403, 410, 504; high, for shells, 403; picric acid, phenol, 405, 414; dis- card of dynamite, 406; propellants, smokeless powder, development of plants, 407-10; and artificial dye mdustry, 413; silk bagging, 450. See also Nitrates. Exports. See War Trade Board. Farm implements, conservation, 221; war service conunittee, 535. Farrell, J. A., steel requirement sur- vey, 125; and steel prices, 317; steel conmiittee, 325; steel distribution sub-committee, 329; on need of manganese, 376. Federal Trade Conmaission, and price- fixing, 50 n., 170, 178; investiga- tions: steel, 320; copper, 350; alumi- num, 356; sulphuric acid, 399; lum- ber, 425; newsprint, 429. Feidman, E. N., Non-Ferrous Metals Section, 352. Felt, D. E., regional advisor, 508, 514. Felt, Section, 442 n., 506; war prob- lems, 450; war service committee. 535. Ferguson, Homer, and War Industries Board, 44 n. Ferro-alloy metals. Section, position, 384, 504. See also Chromium; Ferro- silicon; Manganese; Nickel; Tung- sten; Vanadium; Zirconium. Ferro-silicon, war problem, 384. Fertilizers, agricultural demand for nitrates, 393; cooperative commit- tee, 496. iSee also Potash. Fiber Board and Container Section. 429 71., 506. Fiber containers, war service commit- tee, ooD. Finch, , Fusion Committee, 205. INDEX ,555 Fabricated steel, for shipyards, 330; war service conmiittee, 535. Facilities Division, in War Industries Board, 61, 62, 137; status, 181; pur- pjose, personnel, 198-200, 503; du- ties, and Conversion Section, 245, 246; and labor, 246; Bush as head, 247; and new power construction, 460. Fine Chemicals Section, 504. Finished Products Division, in War Industries Board, 36, 37, 61; sec- tions, 181, 182; germ, 440; person- nel, 502. Fir Production Board, 424 n., 427. Fire extinguishers, scarcity, 458. Fire Prevention Section, work, person- nel, 182, 194, 504. Fisher, Boyd, and training employ- ment managers, 290, 515. Flannery, J. R., Chief of Railway Equipment Section, work, saving to allies, 468, 469, 515. Flavoring extracts, war service com- mittee, 535. Flax, international executives, 266; Section, 442 n., 506; war problem, 450. See also Textiles. Fletcher, E. A., regional advisor, 508, 515. Fletcher, F. F., member War Indus- tries Board, 37, 61, 501, 515; serv- ices, 93; Clearance Committee, 118; and smokeless powder, 408. Foch, Ferdinand, doubts American abUity, 133. Food, reclamation, 279. Food Administration, germ, 29; War it« Council, 43; and priority, 49 n.; and War Industries Board, 59, 105, 126, 128, 206; Requirements Division, 123; and non-essential industries, 184; Fusion Board, 205; public con- tact, 210; and voluntary coopera- tion, 215; sectional representatives and cooperation, 243; and Allied re- quirements, 258; War Labor Policies Board, 288; and tin industry, 368; and arsenic, 416. Food and Fuel Act. iSee Lever Act. Food specialties, war service commit- tee, 536. Ford, Henry, question of favoritism, 340, 341; and ferro-zirconium, 383. Foreign Economic Mission, need, 205 n., 262; and demand for British price-reciprocity, 263, 267, 271; and need of British price-fixing, 263; ad- venture, 264; personnel, 264, 272; diplomatic status, 265; assistance of War Trade Board. 265; direct ac- tion, 265; funds 266; and interna- tional commodity executives, 266; reason for British attitude, 267, 269, 271; forcing price-control, jute, 267-69; and control over tin, 269; and chairmanship of committees, steel, 269-71; and diversion of sup- plies, 271; peace prevents fruition, 271; value as Board's European agent, British shoe contract illustra- tion, 272; and Allied hoarding, 273; French reparation data, 273; and economics at Peace Conference, 273. Foreign Hides and Skins Section, 434, 505. Foreign Wool Section, 442 n., 506. Forgings, Guns, and Ammunition Sec- tion, 505. "Forgodsakers," and conservation, 183, 229. Foster, C. K., Priorities Committee, 146 n., 515; and priorities relating to power, 460. Foster, Clair, Emergency Construc- tion Committee, 197, 514. Foundries, war service committees, 536. France, alteration in "75** shell, 90; shell production, 232; nitrate pool, 392. See also Allies; Foreign Eco- nomic Mission; Inter- Allied Pur- chasing Commission. Frankel, L. K., labor executive com- minee, 282. Frankfurter, Felix, priorities, 146 n.; • committee on non-essentials, 184; War Labor Administration, 286, 515; War Labor Policies Board, 288. I Frayne, H. A., in War Industries Board, 37, 61, 62, 501, 515; char- acter, services, attitude as labor chief, 91-93, 276-278; Price-Fixing Committee, 170; War Labor Policies Board, 288; in steel price-fixing meeting, 321. Freeport Sulphur Company, and war- time supply, 398. Freight cars, war problem, 469. Friday, David, on war and economi. conservation, 218. Friedlich, H. A., L^al Section, 207 n.. 515. Fuel Administration, germ, 29; War Council, 43; Priorities Board, 49 n., 146; and price-fixing, 50 n., 167, 167 n., 170; relations with War Industries Board, 60, 68, 97, 105, 128, 459, 460, 482; and non-essen- tial industries, 184; Fusion Board, 205; public contact, 210; sectional representation and cooperation, 243; and Allied requirements, 258; and labor. Labor VVar Policies Board, 284, 288; and power control, 459. Fur, war service committee, 536. Furniture and fixtures, war service committee, 543. Fusion Committee, economic survey, 205. Garfield, H. A., Price-Fixing Com- mittee, 170, 515; and Baruch, 460. See also Fuel Administration. Garments, war service committee, 536. See also Textiles. Garrison, L. M., and measure for Council of National Defense, 16. Gary, E. H., and steel price-fixing, 177, 317, 319, 322; and war industry and anti-trust laws, 313; on steel in- dustry as war unit, 325; steel in- dustry committees, 325; and war construction, 330; and governmen- tal overbuying, 339. Gas and electric service, war service committee, 536. Gas engines, war service committee, 536. Gas ranges, war service committee, 542. Gay, E. F., and Baruch, 52; Division of Planning and Statistics, 137, 515; committee on non-essentials, 184; and coordination of shipping and trade, 200, 201; Commercial Econ- omy Board, 212; later services, 213. See also Division of Planning. Gears, war service committee, 536. Sleneral Chemical Company, sulphuric acid, 399. "1 i I 556 ENDEX General Electric Company, war-time generators, 463. General Medical Board of Council of National Defense, 472. General Munitions Board of Council of National Defense, origin, purpose, personnel, 34; sub-committees, field, 35, 36; failure, superseded, 36. General Staff, recommends Council of National Defense (1910), 17; and industrial mobilization (1916), 19; weakness, industrial inadeauacy, 30, 111, 132; and control of pur- chases, 130, 131; and Facilities Division, 137. Geological Survey, and War Minerals Stimulation Act, 374 n.; and policy of artificial industrial stimulation, 379-82; war services, 385, 386; nitrate explorations, 389; and potash development, 395; services to Chem- icals Division, 419. Geophysical Laboratory, and optical flass, 396, 471 ; services to Chemicals Hvision, 419. Georgia-Florida Yellow Pine Emer- gency Bureau, 424 n. Germany, inadequate preparedness, 5, 107, 108; bureaucratic efficiency, 78; collapse foretold, 228; copper stocks, 346; potash monopoly, 394, 395; coal-tar derivatives, dyes and explosives, 404, 412; refractory clay, 417; optical glass, 470. Giant, Cal., T.N.T. plant, 404. Gibbs, Anthony, and Company, and nitrates, 392 n. Gibbs, E. C„ regional advisor, 508, 515. Gilford, A. L., Woolens Section, 442, 515. Gilford, W. S., and Council of National Defense, 17; and creation of War Industries Board, 36; on priorities, 143. Glass, container problem, 418; chem- ical glass problems, 418. See also Optical glass. Gloves and Leather Clothings Section, 434. Godfrey, Hollis, and measure for Council of National Defense, 15-17; on Advisory Conmiission, 17; mem- ber of it, coDunittee, 22, 29; Com- mercial Economy Board, 212. Goding, A. T., Domestic Hides Sec- tion, 434. Goethals, G. W., in War Industries Board, 61, 501, 516; and army pur- chases, 131; priorities, 146 n.; on wooden ships, 423; and textiles ad- ministration, 441; woolen specifica- tions, 446. Goetz, G. B., on leather demand, 432 n. Gold and Silver Section, 505. Gompers, Samuel, Advisory Commis- sion, conmiittee, 22, 29; and labor during war, 91, 280-82; and uni- versal service, 92. Gordon, Sir Charles, High Commis- sioner, 260. Grace, E. G., steel committee, 326. Grace, W. R., and Company, and nitrates, 392 n. Graflf, E. D., Steel Division, 326, 516. Graham, W. J., on Advisory Commis- sion, 24r-26. Grain, war service committee, 536. See also Food Administration. Grand Rapids, picric acid plant, 406. Granite paving blocks, war service committee, 536. Great Britain, naval preparedness, 108; conservation method, 229; ex- tent of industrial mobilization, 263; restrictions on American tin supply, 366; mica, 385. See also Allies; Foreign Elconomic Mission; Inter- Allied Purchasing Commission. Grinding wheels, war service com- mittee, 536. Groceries, war service committee, 536. Guggenheim, Daniel, and voluntary copper price-fixing, 347. Gypsum, control, 430. Haight, F. E., Knit Goods Section, 442, 516. Haley, E. J., Tanning Materials Sec- tions, 415, 516. Hall, M. B., priorities, 146 n., 516. Hamilton, C. D. P., Boots and Shoes Section, 434, 516. Hamilton, Grant, labor committee, 283. Hanch, C. C, Automotive Products Section, 464, 516. Hancock, J. M., and Clark's com- mittee, 115, 116; Price-Fixing Com- mittee, 170, 516. Hand tools. See Hardware. Hanson, J. M., Advisory Conmiittee on Plants and Munitions, 191, 516. Hardware, war service conmiittees, 536, 537. Hardware and Hand Tools Section, war conditions and problems, 457, 458; personnel, 505. Hardwood, war-time problems, 428. Hsuness, war demand, 432. Harness and Personal Equipment Section, 434. Harness, Bag, and Strap Leather Sec- tion, 434. ./ moEK. 557 Harriman, Mrs. Borden, labor com- mittee, 283. Hatfield, H. R., Division of Planning, 202, 517; Fusion Committee, 205. Hats, conservation, 224; war service conmiittee, 537. Hawley, H. W., railway equipment priorities, 468 n., 517. Hay, James, and bill for Council of National Defense, 16, 19. Hay ward, A. O., News Section, 507. Hemp, war problem, 451. Hercules Company, sulphuric acid, 399; T.N.T., 404; smokeless pow- der, 407, 410. Herrington, C. E., regional advisor, 508, 517. Hides. See Leather. Hill, J. M., on deficit of iridium, 372. Hines, W. D., and War Industries Board, 60. Hirsch, Maurice, priorities, 146 n., 517. Hoarding, by Allies, 273. See also Stored Materials Section. Hobson, R. P., bill for Council of Na- tional Defense, 17. Hoffman, F. L., labor committee, 283. Holbrook, Percy, priorities, 146 n., 517. Hoover, Herbert, Advisory Commis- sion and, 25; and original War In- dustries Board, 37; and voluntary cooperation, 215; and lesson of War Industries Board, 484, 485. See also Food Administration. Hopewell, Va., pyro-cotton plant, 410. Hopkins, J. M., priorities, 146 n., 517. Horning, H. L., Automotive Products Section, 466. Horse-shoe industry, war-time com- bine, 458. Hosiery, war service committee, 537. See also Knit goods. Hospitals, war service committee, 537. Houck, Roland, Machine Tool Section, 453 n., 518. House, E. M., and measure for Coun- cil of National Defense, 16; and reparation data, 273. Houston, D. F., and A. W. Shaw, 211. See also Department of Agriculture. Houston, J. P., railway equipment priorities, 468 n. Howe, O. C., Foreign Hides Section, 434, 518. Hubbard, R. S., Paints and Pigments Section, death, 415 n., 518. Hughes, John, Foreign Mission, 265, 518. Humphrey, R. L., Building Materials Division, 430, 518. Hurley, E. N., and priority, 200; in- consistent optimism, 338; and Ba- ruch, 460. See also Shipping Board. Huston, A. F., steel committee, 326. Hutchinson, Lincoln, Foreign Mission, 265, 518; tin negotiations, 366. Hydrants and valves, war-time com- bine, 458. Hylan, J. F., and restriction of build- ings, 188. Ice, war service committee, 537. Imports, reduction and shipping re- lease, 200, 204. See also Tariff Com- mission; War Trade Board. India, jute price-control, 268; mica, 385. Indian Head plant, smokeless powder, 408, 410. Industrial Adjustments Committee, organized, policy, 182, 185; career, 186. Industrial committees. See War serv- ice committees. Industrial Gases and Gas Products Section, 414. Industrial Inventory Section, 61 ; func- tion, 136. Industrial mobilization, untold story, 3; unpreparedness, its advantages, 6-8; rise of preparedness movement, pre-war inventory, 13, 14, 137; Na- tional Defense Act (1916), 18; im- portance of raw materials, 27, 30, 67, 89; dictatorship, 28; non-parti- san, 38, 39; necessity of civilian con- trol, 40, 47; completeness, 40, 63, 98, 121, 154, 158, 159; self-control, 73, 74, 98, 162, 190, 191, 214-16, 287, 301, 481; dollar-a-year men, 77, 78; spirit, patriotic service and sacrifice, 78, 79, 360, 439-41, 451; war need, 104, 107; inadequacy of General Staff for. 111, 132; efficiency, and anti-trust laws, fewer laborers and greater production, 207, 218, 230, 311-14, 458, 486; American, as com- plementary or unitary, 235-38; ex- tent of British, 263; vision of inter- national centralized control, 275; post-war neglect of preparedness, 396, 483; future draft, 482; strategy, 485; success of democratic, 488. See also Business in Government; Preparedness; War Industries Board; War service committees. Industrial Preparedness Committee of Naval Consulting Board, work, 12- 14. Industrial relations, committee in Ad- visory Commission, 29. Industrial Workers of the World, war activities, 284. 1 1 It j m. M 1. 1 i I 4 1 il \ ' •/ 558 INDEX Industry, and modern war, 2, 3; de- centralization, 6; problem of war- time stimulation, 379-82. See also Business in Grovemment Coopera- tion; Industrial mobilization; War Industries Board; War service committees. Influenza epidemic, industrial prob- lems, 416, 458, 472. Information. See Data. Ingels, H. P., in War Industries Board, 61, 501, 518. Inglis, J. A., Employment Manage- ment Section, 290, 518. Inland Traffic Section, work, 182, 197, 505. Inland transportation conmiittee in Council of National Defense, 37. •See also Transportation. Inman, E. H., regional advisor, 508, 518. Inter-Allied Purchasing Commission, development in War Industries Board, 45, 61, 62, 105. 256; Re- Sjirements Division, 123; Priorities oard, 146; need, preference blun- ders, 251, 252; established, original members, 252; chief function, 253; later application, 253; Legge as manager, 253; simplicity, 253; lack of authority, attitude of military au- thorities, 254-56; meetings with Al- lied representatives, 257; and other boards, 258; and requirements and actual purchases, 258; financial vastness, 259; foreign and American personnel, 260, 501; integrity, 260. International commodity executives, plan, commodities, 266; for tin, 269, 366; steel chairmanship, 270; not developed, 271; plan for platinum, 375; for nitrates, 392. International Nickel Company, mo- nopoly, 361. Intoxicants, preliminary curtailment of manufacture, 184 n. Iridium, deficit, 371, 372. Iron and steel, war service commit- tees, 537, 538. See also Steel. Iron and Steel Scrap Section, 506. Insurance companies and Stored Ma- terials Section, 195. Italy. See Allies: Foreign Economic Mission; Inter- Allied Purchasing Conmiission. Jackling, D. C, smokeless powder plant, 409. Jackson, L. B., Domestic Hides Sec- tion, 434, 518. James, G. R., Cotton Section, 442 n., 518. I Japan, kapoc, 450. Jewelry, and industrial essentiality problem, 186; war service commit- tees, 538. Joffre, J. J. C, and American partici- Eation, 109. nson, H. S., services in War Indus- tries Board, 93, 518; on clearance, 119; cooperative influence, 126, 131, 243; on priority problem, 149. Johnson, Jackson, regional advisor, 508, 518. Jusserand, J. J., and dress conservation, 220. Jute, international executive, 266; forcing price-control on British, 268; war-problem, 451; Section, 505. Kansas City, regional advisor, 508. Kapoc, war problem, 451. Kean, D. L., Medical Industry Sec- tion, 472 n., 519. Keller, Charles, and power construc- tion, 460; report on power during war, 462 n. Kelley, G. E. C, Rubber Section, 437 n., 519. Kelly, M. C, Emergency ConBtruc- tion Conmiittee, 197. Kerensky, A. F., held-up supplies for, 195. . Keman Report, utilization, 136. Keuffel and Elsser Company, optical glass, 471. King, Stanley, War Labor Policies Board, 288. King, W. L., steel committee, 326. Kittredge, L. H., Facilities Division, 199, 519. Kling, J. A., Conversion Section, 243, 519. Klingenberg clay, 417. Knappen, T. M., on Aircraft Produc- tion Board, 465 n. Knit goods. Section, personnel, 442, 506; work of early service committee, trade attitude toward war orders, 449, 450; control, problems, 450. •See also Textiles. Koster, F. J., regional advisor, 508, 519. Krumb, Henry, priorities, 146 n., 519. Kuhn, J. E., first estimate of army supplies, 31. Labor, committee in Advisory Com- mission, 29; in Council of National Defense, 37; Division in War In- dustries Board, development, atti- tude, 37, 45, 61, 92, 276-78; Gom- pers and war-time, 91; in Price- Fixing Committee, 170; post-war INDEX 559 readjustment studies, 205; Prior- ities Section, and draft, 208, 291, 292; problem of turnover, employ- ment agencies, strikes, chaos, 246, 284; personnel of Division, 278, 501; reclamation of waste, 278-80; gov- ernmental war policy, 280, 283; atti- tude and actions of leaders, 280; pre- war conferences and special com- mittees, 281; Department of Labor and war conditions, 284; I. W. W. menaces, 284; Mediation Commis- sion, work, recommendations, 284; governmental piecemeal dealings, 284; origin of War Labor Admin- istration, duties, boards, 285-89; work of War Labor Board, 287; War Labor Policies Board, 288; War In- dustries Board and labor boards, 288, 289; United States Employ- ment Service, rules of employment, 289; Employment Management Sec- tion, training of managers, 290; impermanence of war-time changes, reaction, 290, 291; power of War Industries Board over, 292; wages and first steel price-fixing, 322; copper miners and price-fixing, 349. Lamont, T. F., at Peace Conference, 274. Landis, J. F. R., estimate of army supplies, 31. Lane, F. K., and beginning of indus- trial mobilization, 28; and railroads, 81; and A. W. Shaw, 211; and War Labor Board Administration, 285, 286; and war-time mineral develop- ment, 385. Lanoline, war demand, 416. Law, A. Bonar, and Foreign Mission, 270. Lead, price-fixing, 164, 359; allocation, conservation, 360; cooperative spirit, 360; cooperative committee, 497. Leather and hides, international execu- tive, 266; Tanning Materials Sec- tion, 415; war demand, 432, 433; hide imports, supply, 433; com- mittees of Advisory Council, 433; control needed, 433; blended army- War Industries Board handling, sec- tions, personnel, 433, 434, 505; sheepskins control, 434; price-fixing of hides and skins, 435; trench shoes, 435; control of shoe industry, drastic plan, 435, 436. Leddy, J. C, Inter- Allied Purchasing Commission, 260, 519. Lee, Elisha, labor executive com- mittee, 282. Legal Section of War Industries Board, 207. 505. Legge, Alexander, in War Industries Board, character, services, 61, 62, 85, 86, 501; Requirements Division, 123, 520; priorities, 146 n.; special sections under, 182; Inter- Allied Purchasing Commission, 253, 256; Foreign Mission, 272; at Peace Con- ference, 273; and Trade Commis- sion's steel report, 320; steel price- schedule, 320; on general industrial situation, 336; on Mayor Thomp- son, 339; and tin, 376; and Railway Equipment Section, 468. i Leith, C. K., Mica Section, 385. Lever Act, and War Industries Board, 96; and priorities, 144; and price- fixing, 166. Lewis, H. J., Gloves Section, 434. Liberty Plate Mill, construction, 329. Light Armor Plate Board, 384. Lima Locomotive Works, war services, 469. Lime, war service committee, 538. Lincoln, Abraham, and legality, 73. Lind, John, labor advisory council, 286. Linoleum, war problem, 451. Linseed oil, scarcity, 415. Lipsitz, Louis, regional advisor, 593, 520. Lithographers, war service committee, 538. Lithopone, war service committee, 539. Little Rock, picric acid plant, 406. Loans to Allies, and industrial prob- lem, 251. Locomotives, standardization, 194; war problem and supply, 469. Loper, R. E., Cotton Goods Section, 442, 520. Lord, James, labor executive commit- tee, 282. Lovett, R. S., member War Industries Board, 36, 37; priorities, 145; and legal basis of price-fixing, 177; Inter- Allied Purchasing Commission, 253; on distrust of trade committees, 303; and Trade Commission's steel re- port, 320; steel price-fixing, 322. Lowell, F. C., Machine Tool Section, 543 n., 520. Lumber, price-fixing, 164, 177, 425, 426; status as war industry, 292; character of industry, 420; filling cantonments order, 420; promptness, iUustrations, 420-22; war demands, 422; attitude toward regulation, 423, 424; cooperation of industry with War Industries Board, emer- gency bureaus, 424; regional admin- istrators, 424 n.; conservation, re- 560 INDEX ■ ill 1 / striction oT production, 426; priori- ties, 426; Division, personnel, 426, 427, 505; crooked jobbing, 427; transportation problem, 428; hard- wood problems, 428; cooperative committee, 497; war service com- mittees, 538, 543. See also Building materials; Pulp and paper. Lundorff, G. W., Emergency Con- struction Committee, 197, 520. McAdoo, W. G., and biU for Council of National Defense, 17; and Banich and War Industries Board, 54, 60, 71, 460; and railroad congestion, 199; and Baruch's Foreign Mission, 264; and platinum, 370. See also Railroad Administration. McAllister, W. B., regional advisor 508, 520. * McAneny, George, and industrial pre- paredness, 14. McCauley, John, Knit Goods Section, 442, 520. McCormick, Cyrus, and Legge, 85. McCormick, Vance, and Baruch, 206; -^as t»ead of War Trade Board, 206. McDowell, C. H., at Peace Confer- ence, 273; Chemicals Division, 377- and nitrates, 393, 399; and potash for optical glass, 396; and platinum substitutes, 419; services, 419. Machines and tools, power in modem war, 452; problems of war-time mak- mg, congestion, 452, 453; method of administration, personnel of Sec- tion, 453, 505; conversions, illustra- tion, 454; commandeering exports, 454; excessive standardization pre- vented, 454; unexpected requirement troubles, 454, 455; cooperative of m- dustry, 455; problems of electric ap- paratus, 463; war service committee, 538. Mackall, Paul, Foreign Mission, 264; chairman international steel com- mittee, 270, 271; Steel Division, 326, 521. McKellar, W. D., Domestic Wool Section, 442 n., 521. McKelvey, C. W., Legal Section, 207 n., 521. McKenney, C. A., in War Industries Board, 131; priorities, 146 n., 521. McKmney, Price, and steel prices. 318, 319. McLauchlan, J. C, Steel Division, 326, 521. McLennan, D. R., Non-War Construc- tion Section, 187, 521. Macpherson, F. H., priorities, 146 n., 521. Macy, V. E., labor executive commit- tee, 282. Magnesium, war demand and suddIv uses, 385. ^' Malay States, tin, 269, 365. Mallalieu, W. E., Fire Prevention Section, 194, 521. Malt, war service committee, 538. Manganese, international executive, 266; dependence on import, 376, 377; Brazilian supply, shipping problem, 377. 382; American d^ posits, character, stimulation, 377. 378, 380, 381; prices, 378; adminis^ tration, 378, 382. Manning, J. J., Labor Division, 278, 521 Manmng, V. H., services to Chemical* Division, 419. Manufacturing Chemists' Association, as industries committee, 419. Marble, war service committee, 538. March, P. C, and War Industries Board, 132, 134; and concentration on troops for France, 133. Marine Corps, Requirements Division, Marsh, T. F., committee on non-essen- tials, 184. Martin, Franklin, Advisory Com- mission, committee, 22, 29, 472; General Munitions Board, 35. Mason, N. E., priorities, 146 n., 521. Master house painters and decorators, war service committee, 539. Master plumbers, war service com- mittee, 540. Matiack, J. C, Rubber Section, 437 n., May, George, committee on non- essentials, 184. Mediation Commission for labor ques- tions, recommendations, 284. Medical industry, eariy committees, 29, 37, 472; personnel of Section, 472, 505; problems, conservation and standardization, 472; and war-time readjustments and scarcity, 472* prices, 473. * Mellon Institute, chemical research. 418, 419. Men's straw hats, war service commit- tee, 537. Merrill, W. H., Fire Prevention Sec- tion, 194, 521. Merryweather, G. E., Machine Tool Section, 453, 521; and excessive standardization, 454; requirement troubles, 455. Metal bed manufacturers, problem, 458. Metel ceiling, war service committee, 533.. INDEX 561 Metal gauges, war service committee, 536. Metal lath, war service committee, 533. Metals, committee in Advisory Com- mission, 29. -See also Chemicals Di- vision; Ferro-alloy; Non-ferrous; Steel. Meyer, Eugene, Jr., copper price, 162, 347; Non-Ferrous Metals Section, 352, 522; and building materials, 430. Mica, war demand and supply, admin- istration, 385; cooperative commit- tee, 497; Section, 504. Michael, C. E., labor executive com- mittee, 282. Midland, Mich., bromine, 416. Mill and mine supplies and machinery, war service committee, 538. Miller, G. E., FacUities Division, 199, 522. Milling, war service committee, 538. Milwaukee, regional advisor, 508. Minerals, committee in Advisory Com- mission, 29; war services of Depart- ment of Interior. 385. See also Build- ing materials; Chemicals Division; Explosives; Non-ferrous; Steel. Minneapolis Steel and Machinery Company, closing, 252. Miscellaneous Chemicals Section, problems, 384, 416. Miscellaneous Commodities Section, 505. Mitchell, W. C, price-fixing, 202, 522. Molybdenum, as alloy, 383. Monel metal, uses, 361. Montgomery, R. H., price-fixing, 170, 522. Moody, H. R., Technical Staff of Chemistry Division, 418, 522. Morehead, J. M., Industrial Gases Section, 414, 522. Morgan, W. F., regional advisor, 508, 522. Morrison, Frank, labor executive com- mittee, 282; special committee, 283. Morrow, Dwight, and shipping for A.E.F., 204 n., 205 n. Morse, F. W., Advisory Committee on Plants and Munitions, 191, 522. Morss, Everett, priorities, 146 tu ; Brass Section, 353, 522. Motor-cycles, conservation, 222. Motor-trucks, war-time control, 465; standardized heavy, 466, 467. Moulton, H. B., Non-Ferrous Metals Section, 352, 522. Munitions, pre-war inventory of pos- sible plants, 13; committee on Ad- visory Commission, 29; strain and complexity of demand, 139, 140; altering Enfield rifle, 191; adop- tion of French artillery types, 192; influence of Advisory Committee, 192, 193; American complementary or unitary supply, 235-38, 402, 408; blunder in takings plant from work for Allies, 252; American accomplish- ment in projectile steel, 330. See also Explosives; General Munitions Board. Munitions Standard Board, 35. Muscle Shoals, nitrate plants, 390, 405. Nashville, powder plant, construction, 399, 407, 410. National Academy, and nitrates, 389. National Advisory Committee on Aeronautics, creation, 18. National Committee of Physicians for Medical Preparedness, creation, 18. National Defense Act (1916), war in- dustry powers from, 18, 19, 95, 96; weaknesses, 30. National Electrolytic Company, and platinum substitutes, 374. National Fertilizer Association, as in- dustry committee, 419. Nationed Research Council, creation, 18; services to Che-nicals Division, 419; and aspirin, 472. National Waste Reclamation Section, work, 278, 279. Naumburg, G. W., Cotton Section, 442 n., 522. Naval Consulting Board, Industrial Preparedness Committee, inven- tory, 12-14, 136, 137; creation, 18. Naval Emergency Act, and War In- dustries Board, 96. Navy, programme, 12; representation in War Industries Board, 37, 61, 93; relations with Board, 41-43, 126, 127; Requirements Division, 123, 127; forecasts of requirements, 125; preference in purchases, 142; Priori- ties Board, 146; in Price-Fixing Committee, 170; industrial com- mandeering, 177 n.; railway mounts for guns, 193; and conspectus peri- odical, 203; sectional industrial representatives and cooperation, 243; War Labor Policies Board, 288; and commodity sections, 307; and ferro-zirconium, 383; and toluol, 402; smokeless powder plant, 408, 410; textile requirements, 447, 448; and machinery requirements, 454. Naxos, emery, 417. Needles shortage, 458. Neutral nations, power of United States over, 261. 562 INDEX 1 ^H '■I \ i New Caledonia, nickel, 361; chro- mium, 378. New England Spruce Emergency Bureau, 424 n. New Republic, on the war and business administration, 79. New York City, and restriction of building, 188; regional advisor, 508. News Section, 507. Newspaper Section, 429 n., 505. Newsprint. See Pulp and paper. Niagara Falls, power shortage, inter- national conservation, 461, 462. Nichols, H. W., Pulp and Paper Divi- sion, 429 n., 523. Nickel, supply, war-time conditions, 361; uses, conservation, 361; prices, 361; priorities, 362; cooperative committee, 497. Nielsen, F. K., at Peace Conference, 273. Nitrates and nitric acid, war impor- tance, use in munitions, 30, 387, 388; international executive, pool, con- trol, 266, 392; no American reserves, futile explorations for deposits, 389; appropriation for plants, 389; in- vestigations and experiments, 389; erection of plants, system, 390, 394, 405; prices, Baruch's bluflf made good, German stocks confiscated in Chile, 390-92; attitude of Chile, special offer, 392, 393; agricultural demand and supply, 393; develop- ment and character of War Indus- tries Board's control, 393, 394; wor- ries, 394; manufacture and conser- vation of acid, its price, 399, 419; Section. 504. Nitro, W.Va., powder plant, construc- tion, 399, 407, 409. Nitrocellulose. See Smokeless powder. Nixon, F. K., Foreign Mission, 265; wool expert, 523. Non-essential industries. See Con- version; Priorities; Requirements. Non-ferrous metals. Division, person- nel, 352, 505; act to stimulate pro- duction, 374; services of Depart- ment of the Interior, 385. See also Aluminum; Antimony; Copper; Ferro-alloy; Lead; Platinum; Quick- silver; Tin; Zinc. Non-War Construction Section, opera- tion, problems, 182, 187-91, 338; personnel, 502. North American Chemical Company, and platinum substitutes, 374. Northcliffe, Lord, High Commissioner, 260. Northeast, war-time industrial conges- tion, 199, 234, 235; and machinery making, 453. Northern Hardwood Emergency Bu- reaus, 424 n. Norton Company, artificial abrasive, 418. Noyes, P. B., Requirements Division, committee on non-essentials, 184, 523; on coal situation, 336. Noyes, P. F., priorities, 146 n. Ocean transportation, problem, 6; un- known factors, yet met, 109, 110; unexpected development of troop carriage, resulting materiel p^o^^^ lem, 133-35. See also American Ex- peditionary Forces; Shipping Board. O'Connell, James, labor executive com- mittee, 282. Ohio Salt Company, and platinum substitutes, 374. Ohio sandstone industry, war service committee, 541. Oil, cooperative committee, 499, 500. Old Hickory Powder Plant, construc- tion, 407, 409. OKve-drab cloth, and sulphide of soda shortage, 414. Oliver, G. S., regional advisor, 508, 523. Olmsted, F. L., Emergency Construc- tion Committee, 197, 523. Open market prices, and war, 171. Optical glass, and need of carbonate of potash, 395, 396; and abrasives, 418; German monopoly. Allied shifts, 470; development in United States, Section, control, personnel, 470, 471, 505. Optical goods, war service committee, 539. Opticians, war service committee, 539. Ordway, L. P., priorities, 146 /i., 523; Foreign Mission, 265. Otis, C. A., and commodity concentra- tion, 241, 242; Resources and Con- version Section, 241, 523; regional advisors, 241-43; cooperation with other boards, 243. Overman Act, and reorganization of War Industries Board, 58, 97, 100; text, 493, 494. Oxygen, war demand, 415. Packing, simplification, 217. Paige, H. R., Nitrate Section, 392, 523. Paints and pigments. Section, prob- lems, 415, 504; war service commit- tees, 539. Palmer, B. W., at Peace Conference, 273. Palmer, G. J., Pulp and Paper Divi- sion, 429 n., 523. INDEX 563 «) Panama Canal Commission, and Re- quirements Division, 127. Paper. See Pulp and paper. Paper bags, war service committee, 539. Parker, E. B., in War Industries Board, 61, 62, 501; character, serv- ices, 88; priorities, 145, 146 n., 523; committee on non-essentials, 184; and coordination of shipping and trade, 200; and automobile indus- try, 339, 341. Parsons, C. L., and nitrates, 389. Patterson, A. M., Foreign Mission, 265; Foreign Wool Section, 442 n., .523. Paxton, J. W., Mica Section, 385; pri- orities, 523. Peabody, H. E., Woolens Section, 442, 443, 523. Peace Conference, economic survey for, 205; American economic advisors, 273. Peek, G. N., in War Industries Board, 61, 62, 501; character, services, 86, 87; Fire Prevention Section, 182; In- dustrial Representative, duties, pol- icy, 239, 240; Conmiissioner of Fin- ished Products, 240, 501; and re- gional advisors, 241, 242; and com- modity sections, 304. Penick, F. E., Inter-Allied Purchas- ing Commission, 260, 523. Pennie, J. C, at Peace Conference, 274. Pens, conservation, 223. Penwell, Lewis, Domestic Wool Sec- tion, 442 n., 523. Periodicals, conspectus, of Division of Planning, 203; of War Industries . Board, 306. Perkins, T. N., Legal Section, 207, 523. PerryviUe, Md., T.N.T. plant, 404. Permit Section, 506. Pershing, J. J., on need of transport, 133; and promised shipping, 204; explosives for Allies, 408. See also American Expeditionary Forces. Peru, vanadium, 383. Petroleum, war service committees, 539, 540. Pharmacy, war service committee, 540. Phenol, manufacture, 400; war de- mand and supply, 405, 414. Philadelphia, regional advisor, 508. Philbrick, M. E., Lumber Division, 427, 523. Phillipps, H. G., priorities, 146 ti., 524. PhUlips, W. v.. Steel Division, 326, 524. Phonographs, war service committee, 540. Photo-engraving, war service com- mittee, 535. Pickles, war service committee, 540. Picric acid, manufacture, plants, 388, 400, 405; as shell explosive, 403; sup- ply of phenol, 414. Pierce, B. D., Jr., regional advisor, 508. Pierce, E. A., Foreign Mission, 265. Pierce, F. E. (L.), Fire Prevention Sec- tion, 194, 524. Pierce, P. E., in War Industries Board, 37, 524; Director of Purch£ise, 130; and smokeless powder, 408. Piez, C. R., priorities, 146 n., 524; War Labor Policies Board, 288. Pig Iron Section, 506. Pig tin, early sub-committee, 498. See also Tin. Pigments, war-time problem, 415. Pipe and supplies, war service com- mittee, 540. Pittman, Alfred, Commercial Econ- omy Board, 212. Pittsburgh, Mellon Institute, chemical research, 418, 419; power shortage, conservation, 461, 462; regional ad- visor, 508. Pittsburgh Plate Glass Company, op- tical glass, 471. Plaster board, control, 430. Platinum, international executive, 266, 375; sources, problem, 364; uses, indispensability, 369; available supply, prices, 370; Draper import, 370; departmental cleavage over problem, 371; and deficit of iridium, 371, 372; Section, control, 373, 501; licenses, 373; overtures to Colom- bia, 373; conservation, jewelry, sub- stitutes, research, 373, 374, 419; efforts for domestic production, 374; demand, 374. Plattsburgh plan, 12. Plows, conservation, 221. Plumbing supplies, war service com- mittee, 540. Pocket-knives, conservation, 222; war service conmiittee, 534. Politics, no place in industrial war machine, 38, 39, 189. Pollak, W. H., Legal Section, 207 n., 524. Post-war readjustment, phase in policy of War Industries Board, 74, 477, 479; and problem of essential indus- tries, 182-86; labor study, 205; labor conditions, 290; repudiation of con- tracts, 484; War Industries Board and carrying out, 487, 488. Potash, German monopoly, 394, 395; development of American deposits, 393; war uses, 395; manufacture of 564 mDEK i \ • / carbonate for optical glass, 395, 396; Section, 400. Pottery, war service committee, 540. Powell, T. C, priorities, 146 n., 468, 524; Inland Traffic Section, 197, 524. Power and transportation, importance in war, 459; cooperation of boards, 459, 460; control through priority, 459; electric, and control by War Industries Board, 460; complex administration. Section, personnel, 460, 505; other connections of Sec- tion, 461; shortage of electric, ap- plication of priorities, conservation, 461, 462; projects of governmental development, pools, valuable data, 461 ; problem of new war plants, 462, 464; machinery, 462; Keller's report, 462 n.; electric equipment, 463; con- servation through diffusion of in- dustries, 463; steam turbines, 463; boilers, 464; other apparatus, 464; importance of Section, 464. See also Railroads. Preference, self-confounding, 139; naval, 142; within army, 142; Ship- ping Board and, 143; and Allied pur- chases, blunders, 251, 252. See also Priorities; Purchases. Preparedness, need ignored, 4; general inadequate, for World War, 5, 6; lack of industrial, 6; unofficial move- ment, influence, 10, 11; Wilson's ad- vocacy, 14; preliminary measures, 18; fruits of, lack, price, 47, 255, 293; German, 107, 108; impossibility of adequate, unknown requirements, 108, 109; lack of data, 205; data and disarmament, 231; post-war neglect of industrial, 396, 483; lack of ma- chines, 452. See also Council of National Defense; Industrial mobil- ization; Requirements; Resources. Prescott, Sherburne, Cotton Section, 442 n., 524. Pressed metals, war service conmiittee. 540. Price-fixing, reorganized War Indus- tries Board, and, 45, 49 n., 50, 61, 62, 105, 165; Brookings as head, 88; and stabilization though priorities, 156, 163, 168, 175, 176; as im- plement of control, 160; legal aspect, 160, 177; beginning, 161; field, con- centration on raw materials, 161, 168, 175, 179, 180; spiritual purpose, and profiteering, 161, 162, 179; vol- untary copper, precedent, 162, 163, 346-48; attitude of industry, 162; causes, suspension of law of supply and deinaiid, 163, 164, 480; informal n^otiations and control, 164; other voluntary concessions, 164; need of underlying drastic control, 165; ad- vantages of indirect legal basis, pub- lic attitude, 166; first steel schedule, conferences, 167, 177, 320-23; coal, 167; other materials, 167; presiden- tial approval, 168, 169; establish- ment of Committee, relations to War Industries Board, personnel, 168-70, 501; functions of Com- mittee, 169 n.; fluidity, 171, 175; and open market, 171; and cost-plus policy, 171, 172; basis, and maximum production and taxation, 172, 176, 322, 323, 343, 348, 351; level-price plan, effect, arguments, 173-75; common price, 175-77; and stabili- zation, 175, 176; method, negotia- tions, 177; periodical, 178; review, 178; assistance. Federal Trade Com- mission, 178; maximum price, 178; administration, alignment with basic prices, 178; legal aspects of "fair price," 179; results, 179; and cottpn, 179, 180; simplicity, 180; section in Division of Planning, 202; book on, 205; American interests and need of British control and reciprocity, 263, 267, 271; inter- national tin, 269, 366; need of steel, 317-19; later copper, 349-52; alu- minum, 356; nickel, 361; sulphur, 398; sulphuric acid, 399; nitric acid, 399; caustic soda, 400; toluol, 414; lumber, 425; paper, 429: building materials, 430; hides, skins, and leather, 435; plan for shoes, 436; woolens and, 445; cotton goods, 448; achievement, 479, 480. Price-Fixing Section of Division of Planning, 202. Printing ink, war service committee, 537. Printing presses, war service com- mittee, 540. Projectile Steel Section, 506. Priorities and allocations, function of Purchase Board, 34; Division in War Industries Board, 36, 37, 61, 62; development by Board, 45, 46, 61; determination in reorganized Board, 49 n.; Parker as head, 88; and Board's industrial control, 105, 154, 158, 159, 293; conditions causing use, 138-40; principles, results, 140; origin, 143; definition, restriction in use, 143, 144; basis of authority, "request" policy, 144; power, 146- 48; bodies, representation, 146; per- sonnel, 146 n., 502; functions, prob- lems, 146-49; and selective draft, INDEX 565 148; general application, 149; and independent boards, 150; first order, steel rating, 150, 324, 328, 329; rat- ing classes and sub-divisions, 150, 151; automatic ratings, 151; classifi- cation of purposes, classes of prefer- ence, 151; voluntary and coopera- tive working, 152, 154, 480; com- plexity of administration, 154, 155; evasions, 156; price stabilizing, check to profiteering, 156, 163, 168, 176; flexibility, illustrations, 157; as fundamental principle, 181; de- mands and conservation, 181; and essentiality of industries, 183; In- dustrial Adjustments Section, 185; Non-War Construction Section, 187; triangular problem in reduction of imports, 200, 204; and damages, 207; Labor Priorities Section, 208; international control, 262; in labor, 290-92; periodical of Division, 306; aluminum, 356; lead, 360; nickel, 362; lumber, 426; pulp and paper, 429; building materials, 430; hides, 435; rubber, 438; machinery, 453; and hardware, infiltration attack, 457; cranes, 456; power and trans- portation, 459-61, 463, 468; achieve- ment, 480, 481. See also Auto- motive products; Clearance.* Production, as main concern of War Industries Board, 176, 181, 323; effect of economic conservation on, 218; slow start, 233, 234, 452. See also Advisory Conmiittee on Plants and Munitions; Resources; and cross references under War Indus- tries Board. Profiteering, Baruch's attitude, 70; influence of priorities and price fix- ing, 156, 162, 163, 168, 176, 179. Public opinion, Congress and, 10. Pulp and paper, early marked for con- trol, 428; proposed allocation of newsprint, 428; Division, sections, personnel, 428, 429 n., 506; regula- tion of consumption, 428; price- fixing, 429; conservation, priority, 429; war service committee, 539. Pumps, war service committee, 540. ^ Purchase Board. iSee General Muni- tions Board. Purchases, War Industries Board and actual, 37, 42, 46, 128, 204, 244; cry against industrial committees and, 37, 42, 77, 302, 303 n., 304; unco- ordinated, 111, 112, 141; competi- tive demands on inadequate supply, 111-13, 156; swamping confusion, 138, 139; war abnormalities in arti- cles of ordinary use, 139; complexity of munition demands, 140; and sec- tional industrial congestion, 199, 234, 235; agencies and conmiodity sections, 307; question of govern- mental over-buying, 334, 338, 447. iSee also Inter-Allied Purchasing CoDMnission; Price-fixing; Priorities; Requirements. PumeU, Frank, Steel Division, 326, 524. Pyrites, compensation of domestic ventures, 381; supply, 397; early sub-committee, 496; Section, 504. Pyro-cotton, proposed Government plant, 410. Quartermasters Corps, reorganization, 130, 131. Questionnaire Section of Division of Planning, 202. Quicksilver, war demand and control, prices, uses, 362, 363. Racine, Wis., T.N.T. plant, 404. Railroad Administration, germ, 26, 29; and priority, 49 n.; and War In- dustries Board, 60, 96, 105, 128, 198, 459, 467, 468 n., 482; Requirements Division, 123; Priorities Board, 146; and Inland Traffic Section, 197; and Facilities Division, 199; and labor, 284; War Labor Policies Board, 288; and sulphur, 398; and creosote, 415; and cranes, 456. Railroads, war-time self-unification, 80-82; War Industries Board and. Section, control, 197, 198, 467, 468; cause of breakdown, 199; saving car space, 217; attempted extortion in ^ied purchases, 469; locomotive problem and supply, 469; freight cars, 469. See also Railroad Admin- istration. Railroads War Board, 81. Railway cars, war service committee, 540. Railway Equipment and Supplies Section. See Railroads. Ransome, F. H., Lumber Division, 427, 534. Ratings. See Priorities. Raw materials, importance, oarly com- mittee, and development of War Industries Board, 27, 29, 30, 301; sub-committees and cooperating conamittees, personnel, 29, 36, 495- 500; importation question, 30; di- vision in War Industries Board, 36, 37; results of decentralized control, 52, 53; Baruch and, 67, 89; price- fixing, 161, 172, 175, 179, 180. Rea, H. R., Advisory Committee on Plants and Munitions, 191, 524. w 4ifi^ V «l 1 566 ) ,- #i> INDEX Reading, Lord, and American conser- vation, 229; and War Industries Board's Foreign Mission, 263, 264, 271. Readjustment. See Post-war. Reay, W. M., Inter-Allied Purchasing Conmiission, 260, 524. Reclamation, of waste, 278; of labor waste, 279. See also Conservation. Reconstruction. .See Post-war readjust- ment. Red Cross, Requirements Division, 123. Redfield, W. C, and measure for Council of National Defense, 16. Reed, L. B., Facilities Division. 199. 525. Reeves, , and automobfle industry and war, 339. Refractories, Section, 417, 504; war service conamittee, 541. Refrigerators, war service committee, 541. R^onal advisors, of Conversion Section, 241-43; list, 508. Replogle, J. H., in War Industries Board, 61, 62, 501, 525; character, services, 87 ; and conmiodity sections, 304; and steel prices, schedule, 318, 320; and diminished production, 324, 326; as head of Steel Division, staff, 324, 326, 506; and automobile industry, 333, 335; on Ford's plant, ^^ 341; and ferro-alloys, 384. •* Request" basis, in War Industries actions, 20, 94, in priorities, 141, 145. Requirements, unforeseeable military, yet met, 108-11, 113, 122, 124, 128, 137; military uncoordinated pur- chase systems, competitive de- mands, 111-13; Clearance Office, 118; never geared to resources, 122; Division, value, weaknesses, repre- sentation, personnel, 123-25, 127, 128, 204, 501, 502; naval forecasts, 125 ^ army purchase reforms, 129-31 ; materiel problenis of army in France, 133-35; priority problem, 148, 149; restrictive instrumentalities, 181, 182; question of industrial essential- ity, policy toward, 182-84; crusade against non-essential industries, "forgodsakers," 183, 229; commit- tee on non-essentials, report, 184, 185; Industrial Adjustments Com- mittee, curtailment policy, career, 185, 186; illustrative elements in non-essentiality problem, 186; cur- tailment of building, 187-91; work of advisory Committee on Plants and Munitions, 191-94; Emergency Construction Committee, building cantonments, 196; duties of Facili- ties Division, 198-200. See alsD Gbarance; Inter-Allied Purchasing Commission; Preference; Prepared- ness; Priorities; Purchases; Re- sources, and commodities by name. Research, chemical, 418, 419. See also National Research Council. Research and inventions, committee m Council of National Defense, 37. Resources, development of appraise- ment in War Industries Board, 45, 61; lack of data, survey by Board, 114; husbanding for growing needs, 121, 122; never geared to require- ments, 122; special units in War Industries Board, functions, 136; Section, status, 136, 137, 181; and gnority problem, 148, 149; price- xing and maximum production, 176, 181; promotive instrumentali- ties, 181, 182; Fire Prevention Sec- tion, 194; hoarding. Stored Mate- rials Section, 194-96; Inland Traffic Section, 197; Facilities Division, 198-200; Division of Planning and Statistics, 200-06; achievement, 479. See also Commodity sections; Con- servation; Conversion; Data; Pre- paredness; Production; Raw mate- rials; Requirements. Retail prices, and price-fixing, 161, Retail stores, exchanges abolished, 216; delivery cut, 216. Reynolds, S. M., News Section, 507,525. Rhodesia, chromium, 378. Rice milling, war service conmiittee. 539. Rifle, alteration of Enfield, 191. Ritchie, A. C, Legal Section, 207, 501, 525; on Foreign Mission funds, 266. Robbins, Walter, Electrical Section. 461, 463, 525. Rochester, regional advisor, 508. Rockwell, J. C, Advisory Committee on Plants and Munitions, 191. Rogers, C. A., Harness Equipment Section, 434, 525. Roosevelt, F. D., War Labor PoHcies Board, 288. Root, Elihu, and measure for Council of National Defense, 16; and Gen- eral Staff, 130. Rope paper and rope paper sacks, war service committee, 539. See also Cordage. Rc^engarten, A. G., Miscellaneous Chemicals Section, 416, 525; Medi- cal Industry Section, 472 n. INDEX 567 Rosen wald, Julius, Advisory Commis- sion, committee, 22, 29; General Munitions Board, 35, 36; and can- tonments, 197 /I.; and leather arti- cles, 433. Rossiter, W. T., Conversion Section, 243, 525. Rowbotham, G. B., Belting Section, 434, 525. Rowland, J. W., Rubber Section, 437 n., 525. Rubber, importation question, 30, 437; international executive, 266; British control, 269; stable price, explana- tion, 436, 437; Section, 437, 506; al- locations, 438; move in Peace Con- ference to insure supply, 438; coop- erative committee, 500; war service committees, 541. Rublee, George, and shipping for American Expeditionary Forces, 204 n., 205 n. ; Commercial Economy Board, 212; later services, 213. Russia, held up supplies for Kerensky, 195; platinum, 364. 370. Ryan, J. D., and War Industries Board, 44 n.; and voluntary copper price-fixing, 347; and later price, 350, 351. Saccharine and toluol, 414. Saddlery, war demand, 432; hardware shortage, 458. Saeger, W. C, Legal Section, 207 n., 526. St. Louis, regional advisor, 508. St. Paul, regional advisor, 508. Salvage. See Conservation. Sample trunks, reduction, 217. Samples, conservation, 219, 221. San Francisco, regional advisor, 508. Sanford, H. W., Ferro- Alloy Action, 384, 526. Sanford, R. B., and bill for Council of National Defense, 16. Sanitary earthenware, war service committee, 535. Sanitation, committee in Advisory Commission, 29. Saving by producer rather than con- sumer, 230. See also Conservation. Sawyer, D. E., Steel Division, 326, 526. Scandinavia, American influence over, 261. Schmidt, J. C, Chains Section, 457 n., 526. Schoelkopf, J. F., Jr., Artificial Dyes Section, 413 n., 526. Schram, L. B., labor executive com- mittee, 282. Schwab, C. M., and steel prices, 322; steel committee, 326. Scott, F. A., chairman General Muni- tions Board, 35; chairman War In- dustries Board, breaks down, 36, 42, 44, 526; character, services, 82-84; war prescience, 83; Clearance Com- mittee, 118. Scott, J. W., Textiles Division, 441, 526. Scott, R. W., Knit Goods Section, 442, 526. Seattle, regional advisor, 508. Seeds, war service committee, 541. Self-control in industrial mobilization, 73, 74, 98, 162, 190, 191, 214-16, 287, 301, 481. Self ridge, E. A., Jr., Lumber Division, 427, 526. Semet-Solvay Company, and nitric acid, 389. Semiporcelain and china, war service committee, 540. Shaw, A. W., in War Industries Board, 62; and origin of conservation Divi- sion, 211, 228, 526; Commercial Economy Board, 212; bread-return privilege, 213; and voluntary coop- eration, 214; lines of elimination, 219; and Baruch, 227. Shaw, Albert, and industrial prepared- ness, 14. Shaw, G. M., Advisory Committee on Plants and Munitions, 191, 526. Sheepskin, and Glove Leather Sec- tion, 434; control, price-fixing, 434. Sheet metal, war service committees, 541. Sheet steel, early sub-committee, 498. Sheffield, Ala., nitrate plant, 390. SheUs. See Artillery. Sherley, Swagar, and periodical, 203. Ship Control Committee, and War In- dustries Board, 204 n. Shipping, committee in Council of Na- tional Defense, 37; Section, 506. Shipping Board and Emergency Fleet Corporation, War Council, 43; and priority, 49 n.; and War Industries Board, 60, 105, 126, 128, 459; Re- quirements Division, 123, 125; and preferences, 143; Priorities Board, 146; and coordination with trade, 200, 204; Fusion Committee, 205; sectional representatives and coop- eration, 243 ; and Allied requirement;, 258; and labor, 284; War Labor Pol- icies Board, 288; and commodity sections, 307; and sulphur, 398; and cranes, 456; and anchor chains, 457; and transportation control, 459. Shipyards, construction, 330. Shoddy, use, 445, 446. Shoes, conservation, 224; cont^n- I fW«! 568 INDEX 1 I 1) \f i ; i h ! plated price standardization, 224; rJ'i^^^.oo^^?*'"^^*' 2'-' war demand, 462, 433; for trenches, 435; control of industry, drastic plan, 435, 436. Shotwell, E. C, Sheepskin Leather Section, 434, 526. Signal Services, preference, 142. Silk tin conservation, 221; Section, 442 n., 506; war problem, 450; war service committee, 541. Simmons, W. D., Commercial Econ- omy Board, 212; later services, 213. Simple life, and economic equality, 218. Simpson, F. F., Medical Industry Sec- tion, 472, 526. ^ Skmner, William, SUk Section, 442 ti.. Skins. See Leather. ^"Jll?' ™^' ^'"^^ Prevention Section, 194, 527. Smith, E. D., and nitrates, 393. a\^' S- ^'A ^^"^'^ CJoods Section, 442; Flax Products Section, 442 n. 427. Smokel^ powder (NitroceUulose), manufacture, complex process, 388, 407; demand and supply, 407, 410- constniction of governmental plants,' Banich s activity, 408-10; proposed pyro-cotton plant, 410; price, 410. Society of Automotive Engineers standard heavy truck, 466. Soda ash, war conditions of industrv 400. ^' Sodium nitrate. -S^e Nitrates. Sole and Belting Leather Section, 434. Southern Pine Emergency Bureaus, 424 n.; and price, 425. Sowers, W. J., regional lumber admin- istrator, 424 n., 527. Spain, mules and anunonia sulphate 72, 158; cork, 451. ' Spec, Maxunilian von, reason for Pa- cific cruise, 388. Spencer Lens Company, optical glass 4/1. o . SpiHraan, W. J., Labor Division, 278, Spruce problem of Aircraft Board 142 427. ■'«**v», j.-»^. Stabilization, as policy of War Indus- tnes Board, 156, 175, 176. Staley, H. F., Refractories SecUon, 417 n., 527. Standardization, committee in Advi- ^ry Commission, 29; War Industries Board and, 208; of building material schedules, 431; prevention of ex- cessive, of tools, 454; heavy dutv trucks, 466, 467. Stanley, W.W., Power Section, 461,527. Starrett, W. A., Emergency Con- struction Committee, 196, 527. State Councils of Defense, and re- striction of building, 187. State Department, and conspectus penodical, 204. Stationery, war service committee. 541. Statistical Division, taken over bv arnay, 201. ^ Statistics, committee in Council of National Defense, 37. See also Data. Steam and hot water fittings, war service conmiittee, 542. Steam turbines, war problem, 463. Steel, priorities, 150, 324, 328, 329- pnce-fixmg conferences, 164, 165 167, 177, 317-23; internaUonal com- nuttee, chairmanship, 267, 270, 271- importance in war, 315, 316, 326; problem of war supply and demand, 316, 317; report of Federal Trade Commission, disparity in costs, 320; uniform price, 322; industry as governmental controlled unit, 323- 25, 327-30, 344; reduced production, conference, 324, 327, 328; discipline, rf^5; industry cooperative com- mittees, 325, 326, 329, 497-99; and war, 326; personnel of Division, sections, 326, 506; factors in success of Division, 326; conversion in, 326* work of industry's distribution com- mittee, 329; fabricated shipyards, 330; limitations, 330; war accom- plishments, 330, 331; reason for P"ce, 343; eariy sub-committees, 498, 499. See also Automotive prod> nets; Ferro-alloy. Steel barrels, war service committee. 542. Steel tanks, war service committee, 542. Steriing silver and silver plate ware war service conunittee, 538. * Stettmius E. R., Surveyor-General of Supplies, 42, 53, 85; inconsistent optimism, 339. ^^clj^' ~Z:r^ ^^ s^Ps for A.E.F., 204 n., 205 n. Stone, W. S., labor executive commit- tee, 282. Stoneware, chemical, problem, 418 Stored Materials Section, 182. 506: work, 194-96. Storrs, C. P., Mica Section, 385. Stout, C. F. C, and leather control. 434, 527. * Stores, war service committee, 542 Strategy, industrial, in peace and war, 485, 486. Strong, Benjamin, and measure for Council of National Defense, 16. INDEX 569 Stroock, Sylvan, Felt Section, 442 n., 527. Stuart, H. C, Price-Fixing Committee, 169, 527. Subsidy, war-time problem of indus- trial, 379-82. Substitution, in war-time conservation, 219, 224. See also Conservation. Sugar, war service committee, 542. Sullivan, J. W., labor executive com- mittee, 282. Sulphide of soda, and olive-drab cloth, 414. Sulphur, domestic supply. Section, control, price, 398, 504; early sub- committee, 496. Sulphuric acid, war-time supply and control of materials, 397; manufac- ture, price, 399, 419. See also Ex- plosives. Summers, L. L., General Munitions Board, 35; in War Industries Board, 61, 62, 501, 527; character, services, and war chemistry, 88-91, 419; and toluol, 91, 402; Foreign Mission, 264; and jute price-control, 268; and chairmanship international steel committee, 270, 271; at Peace Conference, 273; and commodity sections, 304; steel price-schedule, 320; in automobile conference, 341; and Draper's platinum import, 371 ; and ferro-alloys, 384; and nitrates, 390, 391, 393; and smokeless powder, 408; and Technical Staff, 418. Sunday, "Billy," and restriction of building, 188. Supervisors of rail transportation, war service committees, 540. Supplies, committee in Advisory Com- mission, 29; War Industries Board and general oversight, 101. See also Purchases; Requirements; Re- sources; War Industries Board. Supply and demand, suspension of law, 164, 480. See also Require- ments; Resources. Surface, F. M., Fusion Committee, 205. Surgery, war service committees, 538, 542. Surgical needles, manufacture, 472. Sweater coats, war service committee, 537. Sweet, E. F., Labor Division, 278, 527. Swope, H. B., in War Industries Board, 61, 501, 527. Taft, W. H., War Labor Board, 287. Taft-Walsh Board. See War Labor Board. Talmadge, J. B., Emergency Con- struction Committee, 197, 528. Tanning, war service committees, 542. Tanning Materials and Natural Dyes Section, problems, 415, 504. Tardieu, Andre, High Commissioner, 260. Tariff Commission, and price-fixing, 50 n., 170. Taussig, F. W., Tariff Commission, Price-Fixing Committee, 170, 528; on level-price policy, 173, 174; at Peace Conference, 273. Taxation, and price-fixing, 172, 323, 348. Taylor, Alonzo, and liaison of war boards, 206. Taylor, I. H., Conversion Section, 243, 528. Technical and Consulting Section, chemical, work, 61, 297, 418, 419, 504. Templeton, A. A., regional advisor, 508, 528. Tents, requirements, 447. Textiles, erasing Civil War blot, 439; regulating power in hands of opera- tors, result, 439, 440, 451; early ad- ministration, sub-committees, 440, 441; army and administration, 441; Division, sections, personnel, 441, 506, 507; felt, silk, flax, 450; jute, hemp, cordage, kapoc, cork, 451; service of War Industries Board, 451. See aho Cotton goods; Knit goods; Woolens. Thomas, P. H., Power Section, 461, 528. Thompson, F. E., Steel Division, 326, 528. Thompson, W. H., and war-time con- struction, 338. Thread, spool conservation, 221; sec- tion chief, 506; war service commit- tee, 534. Thrift campaign, investigation, 205. Thurston, E. G., Non-Ferrous Metals Division, 352, 528. Tile, war service committee, 542. Tin, conservation, 221, 223, 367, 368; international executive, price-fixing, success, 266, 366, 368; Foreign Mis- sion and control, 269; American de- mand, 365; sources, British restric- tions, 365, 366; control of import, allocation, 366; Section, 367, 506; scrap recovery, 367; production of tin plate, 367; other uses, 367; coop- erative administration, 368; early sub-committees, 498, 499. Tinfoil, conservation, 221, 223, 368. T.N.T., supply and demand of toluol, manufacture, 91, 388, 402, 404, 414; as shell explosive, 403. u f- 570 INDEX INDEX 571 4 wl #< m^ / Tobacco, saccharine for chewing, 414; miUtary demand, 473; Section, 474, 506; war service committee, 542. Toluol, war demand and supplv, 91 402,404,414. ^ Tools. See Machinery. Topping, J. A., steel committee, 326. Torrence, R. M., Chemical Glass and Asbestos sections, 384, 418 n., 528. Toys, war service conmiittee, 542. Tozzi, , Itedian Commissioner. 260. Trace chains, conservation, 222. Trading-with-the-Enemy Act, and War Industries Board, 97. Transportation, committee in Advis- ory Commission, 29; basic industry, 30; committee in Council of National Defense, 37; statements of problem, 336-38. See also Aircraft; Automo- tave products; Ocean transportation- Power and transportation; RaUroads; Shipping Board. Transportation Priority Act, and War Industries Board, 96; and priorities, 144. Trigg E. T., regional advisor, 508, 528. Trunks and traveling goods, war serv- ice committee, 542. Tubular products, eariy sub-commit- tee, 499. Tucker, Samuel, Technical Staff of Chemistry Division, 418, 528. Tungsten, international executive, 266; compensation of domestic ventures, 381; war and demand and produc- tion, administration, 382; uses, 382. See also Ferro-alloys. Turner, Spencer, Cotton Goods Sec tion, 441, 448, 528. Tuttle, M. C, Emergency Construe tion Committee, 197, 528. Typewriter ribbons, conservation, 221 Van Auken, W. R., Optical Glass Section, 471. Van Doren, D. H., Legal Section, 207 n., 528. Van Duzer, H. B., Fir Production Board, 427, 528. Vanadium, sources, war problem and administration, 383. See also Ferro- alloys. Varnish, war service committee, 539. Vauclain, S. M., on credit for war success, 190; Advisory Committee, 191, 528; and altering Enfield rifle, 191; and French artillery types, 192; method, 193; and tanks, 194. Vitrified glazed sewer pipe, war serv- ice committee, 534. Vogel, A. H., regional advisor, 508, Vogel, F. A., Harness Leather Section. 434, 529. Underwear, war service committee, 537. Union Sulphur Company, and war- time supply, 398. United Metals Selling Company, and copper allocation, 352. United States Employment Service, 289. United States Government Explosive Plants Units, 409. United States Housing Corporation, and Emergency Construction Com- mittee, 196. United States Steel Products Com- pany, and tin import and control, 269, 366. Vacuum cleaners, war service com- mittee, 542. Wages. See Labor. Wagons and vehicles, war service com- mittee, 535. Wah Chang Company, antimony im- ports, 358. Wall paper, war service committee. 542. Walsh, F. P., War Labor Board, 287. Waltz, Andrew, Non-Ferrous Metals Division, 352, 529. War, modem, scope, 2, 3, 104, 107, 387; and steel, 315, 326; and copper, 345; and chemical action, 397; and machinery, 452. War Contracts Section of Division of Planning, 202. War Council, conferences, results, 43; and periodical, 203. War Department. See Army; Baker, War Finance Corporation, and Re- qmrements Division, 127; power loans, 461. War Industries Abroad Section, 202. War Industries Board, importance, 4; question of extrale^ahty, 4, 19, 48, 58, 59, 94; evoluUon, advantages' fluidity, 8, 9, 19, 20, 45, 63, 94, 1.32, 208, 293, 294, 297, 298, 363, 478; basis of authority, 18-20, 95, 152- 54; rule by "request," spirit of co- operation, 20, 94, 97, 105, 360; germ, importance of raw materials, 26, 27, 30, 301 ; original committee and sub- committees in Advisory Council, cooperative committees, 29, 495- 500; General Munitions Board, 34- 36; creation, first members, 36; Scott, 36, 42, 44, 82; original duties and divisions, 37; and purchases, m\ attitude toward requirements, 37, 42, 46, 128, 204, 244; and civilian control over war industry, 40, 47; completeness of control over in- dustry, quiet character of control, 40, 63, 74, 98, 102, 104, 105, 154, 158, 159, 292, 368, 466, 475, 481, 482; results of no centralized con- trol and "teeth," attitude of mili- tary boards, 40-43, 51-53, 68, 69; Willard, 43, 44, 82; and War Council conferences, 43; centralized re- sponsibility and divided authority as energizing principle, delay in finding it, business in Government 44, 58, 73-76, 99, 241, 311-14, 474 fundamentals for proper head, 44 conception of objectives, 45, 46 Executive reorganization as direct war power. President's letter, func- tions, centralized control, 48-51, 58, 59; choice of Baruch as head, 54; development of plan of reorganiza- tion, 54-58; reorganization or super- session, 58, 59; Baruch's earlier re- organization plan, 59; results of in- articulation with other boards, 59- 61; functional elements of reorgan- ized, 61; industrial contact, com- modity sections, 61 ; personnel of re- organized, divisions, 61, 62, 501; range of chairman's power, 62; char- acter of personnel, 65, 73, 76; Bar- uch's characteristics as head, 66-76; as clearing-house for self-controlled industry, 73, 74, 98, 162, 190, 191, 214-16, 287, 301, 481; Legge, 85, 86; Peek, 86, 87; Replogle, 87; Parker, 88; Brookings, 88; Summers, 88- 91, 419; Frayne, 91-93, 276-78; Fletcher, 93; Johnson, 93, 131; legislative sources, 95-97; Overman Act and, 97, 100, 493, 494; and President's war powers, 97; power as purchasing agent, 97; power through patriotic cooperation, 97, 105; disciplinary measures, illustra- tions, 98, 99; limitations of field of power, 100; paramount relations to other war boards, 101, 125-28, 206, 294-96, 310, 459, 468 n., 487; Wilson and completeness of control, 103; and commandeering, 103; Baruch's outline of purposes, 104-06; as equalizer of war strain, 105; control through priorities, 105, 480, 481; through price-fixing, 105, 106, 479, 480; survey of resources, 114; func- tions in brief, plan of attack, 122, 181, 478; and ungeared supply and demand, 122; and army cooperation after reorganization, 122, 131, 135; lack of representation in other boards, 124, 125; and aircraft sup- plies, 142; and military estimates, 153; decisiveness, 155, 298; reorgan- ization and price-fixing, 165, 168- 70; and stabilization and standard- ization, 175, 176, 208; maximum production as main concern, 176; and partisanship, 189; Legal Sec- tion, 207; and public contact, 210; overlapping and team work, 227, 230; and Allied economic coopera- tion, 238; virtual local boards, 241, 243, 245; expenditures, 254 n.; ab- sorptive nature, 256; as functionary of Allies, 258; financial vastness, 259; and international economic control, 262, 368; and purse strings, 296; and authority at the source, 296; and industries committees, 303 n. ; list of divisions and sections, 306 n.; platinum problem and Bu- reau of Mines, 371 ; and War Min- erals Stimulation Act, 374 n.; and policy of artificial industrial stim- ulation, 379-81; as industrial bel- ligerent, 387; complexity of work, 455; future honor, 475-77; demo- cratic domination and preserved industrial vitality, 477, 479; single power versus bureaucracy, 477; achievement in resources, 479; serv- ices and future industrial draft, 482; question of permanency of lesson, 484; and industrial strategy in peace, 485, 486; quick disbandment, 486, 487; and post-war readjustment, 487, 488; success of democratic industrial mobilization, 488; person- nel of functional divisions, 501-03; of commodity sections, 503-07; regional advisors, Ust, 508; person- nel, alphabetically arranged, 509- 31. See also Clearance; Commodity sections; Conservation; Conversion; Data; Division of Planning; Foreign Economic Mission; Inter- Allied Pur- chasing Commission; International executives; Labor; Price-fixing; Pri- orities; Requirements; Resources; War service committoes. War Labor Administration, germ, 29; and War Industries Board, 105; origin, purpose, 285; divisions, 286- 90. See also Labor. War Labor Board, origin, chairmen, work, 286-88. War Labor Conference Board, 286. War Labor Policies Board, committee on non-essentials, 184; work, 288, 289. War Minerals Stimulation Act, pro- 572 INDEX INDEX 573 I ■■ ! ••i • • / H visions, 374; ^nd manganese, 377; problem, 379-82. War powers of Executive, as source for War Industries Board, 97. War Prison Labor Section, personnel, 278, 501. War service committees of industry, beginning of early cooperative sys- tem, 28; first conference of chiefs with Council, 28; popular outcry against early seller-buyer conMnit- tees, 37, 42, 77, 302, 303 n., 304; later, and conmiodity sections, 301, 302; self-control, 301; appointment of later through Chamber of Com- merce of the United States, 302, 304, 543; and data, 308; staffs, 310; steel, 325, 326, 329; copper, 351; brass, 353; zinc, 355; lead, 360; chemicals, 419; lumber, 424; early control through, character, 439-41 ; woolens, 445; electrical industry, 463; early, cooperative, under Baruch, list, personnel, 495-500; list and person- nel of later, 532-43. See am> Com- modity sections; Industrial mobili- zation. War Service Executive Conmiittee, 532. War Trade Board, and priorities, 49 /i., 146; and War Industries Board, 60, 206, 482; and requirements, 125; and resources, 182; and non-essen- tial industries, 184; and Stored Materials Section, 194; and coor- dination of shipping and trade, 200, 201, 204; Fusion Committee, 205; labor readjustment study, 205; and Foreign Mission, 265; and tin im- port, 366, 368; and caustic soda, 400; and hides, 435; and rubber, 437; and wool, 443. Warehouses. See Stored Materials Section. Warm air heaters, war service com- mittee, 542. Washing machines, war service com- mittee, 542. Waste reclamation, 278; war service conmiittee, 543. Watches for the A.E.F., investigation, 205. Webb, S. W., regional advisor, 244, 508, 529. Weber, O. F., Non-Ferrous Metals Section, 352, 529. Webster, A. L., Domestic Hides Sec- tion, 434, 529. Weeks, J. W., and bill for Council of National Defense, 16. Weidlein, E. R., chemical research, 418, 529. Weiss, L. S., Legal Section, 207 n., 529. Wessel, Duval and Company, and nitrates, 392 n. Western Electric Company, and plati- num substitutes, 374. Westinghouse Company, war-time generator, 463. Wettstein, J. R., lead allocation, 360. Wheeler, Andrew, Steel Division, 326, 529. Wheels, war service committee, 543. White, J. L., railway equipment pri- orities, 468 n. White, J. P., War Labor Policies Board, 288. Whiteside, A. D., Foreign Mission, 265; Foreign Wool Section, 529. Whitin, E. S., Labor Division, 278, 529. Whitmarsh, T. F., priorities, 146 n.; Rwjuirements Division, 529. Wilkins, J. F., Stored Materials Sec- tion, 194, 530. Willard, Daniel, chairman Advisory Commission, 22; first step toward Railroad Administration, 26; com- mittee, 29; warning on situation, 33; and creation of War Industries Board, 36; as chairman of Board, 43, 44; and reorganization of Board, 68; services, and railroad war-time unification, 80-82. Williams, C. C, and Vauclain, 194; and cooperation, 243. Williams, Harrison, in War Industries Board, 61, 501; Facilities Division, 199, 530. Williams Harvey Corporation, tin smelter, 365 n. Willson, S. L., Pulp and Paper Divi- sion, 429 M., 530. Wilson, W. B., labor executive com- mittee, 282; Mediation Commis- sion, 284; War Labor Administrator, 286. Wilson, Woodrow, and navy, 12; and preparedness, 14; and measure for Council of National Defense, 16; on purpose of Council, 21; non- partisan industrial war machine, 38, 39; and head for War Industries Board, 44 n., 68; reorganization of Board, 47-50, 56-59, 68, 100, 101; and Baruch, 68, 69, 71, 102; grasp of fundamentals, 102; follow-up of re- organization of Board, 103; warning on prices, 165; and price-fixing, 168, 169, 322, 351; and industrial essen- tiality problem, 184; War Cabinet and periodical, 202, 203; and Depart- ment of Justice, 204; promise of f shipping, 204, 205 n.; and bi-lateral war participation, 251; and Baruch's Foreign Mission, 264; Labor Media- tion Commission, 284; and nitrates, 393. Window-glass, war service committee, 536. Winslow, C. H., Labor Division, 278, 530. Winton, C. Y., Lumber Division, 427, 530. Wire, anomalous clearing committee for electric, 115, 116; demand for copper, at the front, 345; Section, 463, 504; early sub-committees, 499. Wisner, F. G., Lumber Division, 427, 530. Witherspoon, Herbert, regional ad- visor, 508, 530. Withey, P. K., Steel Division, 326, 530. Wolman, Leo, Fusion Committee, 205, 530. Women's Defense Work, committee in Council of National Defense, 37. Wood, J. P., woolens committee, 445. Wood, Leonard, and preparedness, 11; and Council for National Defense, 15. Wood chemicals, Section, personnel, problems, 415, 416, 504; war service committee, 533. Wood Products Section, 428, 503. Woodworking, allocation among es- tablishments, 428; war service com- mittee, 543. See also Lumber. Wool, conservation, 223, 224; interna- tional executive, 266; British price- reciprocity, 271; governmental con- trol of supply, allocation, 443; cooperative committees, 500, 543. See also Woolens. Wool grease, war demand, 416. Woolens, Section, personnel, 442, 506; war supply absorb output, army control, 442-44; governmental con- trol of wool supply, allocation, 443- 45; prices, 445; trade handling of business, 445; use of shoddy, 445, 446; war service committee, 543. See also Textiles. Woolley, C. M., and War Industries Board, 125; priorities, 146 n., 530; committee on non-essentials, 184; and liaison of war boards, 206. Worcester, C. H., Lumber Division, 427, 531. Wright, F. E., Optical Glass Section, 471. Yarn Section, 506. Yeatman, Pope, Foreign Mission, 272; Non-Ferrous Metals Division, 352, 531. Young, All n, at Peace Conference, 274. Zane, A. V., priorities, 146 n., 531. Zimmerschied, K. W., automotive transport committee, 466. Zinc, price-fixing, pool, 164, 355; char- acter of war problem, 354, 355; co- operative committee, 500. Zirconium, development as ferro-alloy, 383. See also Ferro-alloys. Zoning system, in War Industries Board's work, 241-43, 245; adop- tion by other boards, 243; regional advisors, 508. :«M I «!! .;!' I ' : ' I « I 'I I ' «i|« * lb I COLUMBIA UNIVERSITY LIBRARIES ^.,iA^A Kv thA library rules or by special arrauB^ provided by the Ubrary the Ubrarian in charge jUt lb U TAO Ws-w C28(H49)lOOM I 0C(&o FEB I 4 1995 -.^oSSil COLUMBIA UNIVERSITY LIBRARIES 0041429680 D997.3 C56 D997.3 C56 ^larkson. Industrial America in the world war. A