America's War Hero - Free Enterprise
GUEST AUTHOR BLOG by Arthur Herman author of, "Freedom's Forge: How American Business Produced Victory in World War II."
Imagine you’re the President of the United States and your top advisors and your gut tell you that you’ll probably be at war with the two most aggressive military powers on earth in less than two years– and you have an army not much bigger than Holland’s.
"Freedom’s Forge: How American Business Produced Victory in World War II"tells the story of what Franklin D. Roosevelt did when he found himself in that situation in May 1940, as war with both Nazi Germany and imperial Japan loomed on the horizon.
Roosevelt called the president of General Motors, Big Bill Knudsen, and persuaded him to come to Washington to organize a national war production effort.
Knudsen was a Danish immigrant who had worked his way up from the factory floor to become head of Chevrolet and GM. He understood the natural productivity of American capitalism, and organized the war build-up in ways that defied conventional Washington thinking then and now, about how to commit this country to an all-out effort.
Knudsen mobilized the energies and resources of private industry and his fellow business executives–the so-called dollar a year men who left companies like AT&T, Sears, and US Steel to work for an annual Federal salary of one dollar–to organize a bottoms-up, voluntary conversion of American industry from making refrigerators, cars, tractors, and typewriters to making tanks, machine guns, land mines, aircraft engines, and eventually entirely airplanes at plants like Ford’s facilities at Willow Run, Michigan.
Working with no cooperation from an isolationist Congress, and in the teeth of scathing criticism from official Washington and the media, Knudsen and businessmen like Henry Kaiser, Steve Bechtel, Chrysler’s K.T. Keller, and Lockheed’s Robert Gross turned America’s factories into the arsenal of the free world.
By the time of Pearl Harbor, America’s war production effort was approaching that of Hitler’s Germany. By the end of 1943 it was bigger than that of Germany, Britain, and the Soviet Union combined.
The result wasn’t just production of war munitions on a size and scale never imagined–some 70% of all the weapons used by the Allies in World War Two. The war production miracle remade the industrial map of America, expanding factories and businesses from Florida and North Carolina to Texas, Utah, and California. National GDP nearly doubled, half a million new businesses sprang up during World War Two. The productive power Knudsen and his colleagues unleashed triggered a postwar boom that lasted nearly thirty years–the greatest expansion of the American standard of living in history.
The story of "Freedom’s Forge" matters not just because of the lessons it offers for economic policy today. It’s also my personal tribute to the men and women (by 1944 almost one-third of the workers in America’s aviation industry were female) who worked in the factories, plants, shipyards, offices, and warehouses to build what Knudsen first termed “the arsenal of democracy”–the other half of the World War Two’s Greatest Generation whose story of dedication and sacrifice has never really been celebrated, until now.
Arthur Herman is the author of "Freedom's Forge: How American Business Produced Victory in World War II." A visiting scholar at the American Enterprise Institute, he is also the author of How the Scots Invented the Modern World, which has sold more than half a million copies worldwide. His most recent work, Gandhi & Churchill, was the 2009 finalist for the Pulitzer Prize in General Nonfiction.