- Chapter XIV:
The ASF and the WPB: The Control of Raw Materials
It is impossible to examine here
all of the working relationships of the Army Service Forces and the War
Production Board. They were many and varied. But all ASF thinking and
actions were based upon the clear recognition that the military procurement
program of World War II could not be accomplished without the work of the
WPB.
As already indicated, relationships
between the civilian industrial mobilization agency and the military
procurement services changed with changing circumstances. Thus the Office of
Production Management reviewed all war contracts for more than $500,000
during 1941; in 1942 the figure was raised to $5,000,000, but contract
clearance became a mere formality and soon practically disappeared. In 1942
a Plant Site Board was very active in OPM giving final approval to the
selection of locations for large-scale new plant construction. By the end of
1942 this work had virtually ceased to have any importance. There was some
controversy about whether the Army was trying to build more plants than
could be operated with the prospective supply of raw materials. This issue
simmered throughout 1942 and was more or less settled by the final
determination of 1943 military production requirements. 1
If output of munitions was the
Army's number one supply problem in 1942, the control of the distribution of
raw materials was the number one problem of production management. It has
already been pointed out that a priorities system had been introduced as
early as the autumn of 1940 and had been considerably extended in February
1941. The early priorities system was relatively simple. When letting a
contract for ammunition, tanks, guns, radios, or any other military supply
item, the procurement district offices of the technical services assigned a
"preference" rating to the contract. This rating was then used by
the contractor in ordering raw materials and component parts for the
end-item he had agreed to make. Suppliers were supposed to be guided by
these preference ratings in distributing materials to various industrial
users. In addition to the military preference ratings, there were also
ratings for essential civilian production. These were granted directly by
the OPM and later the WPB, usually on an individual basis.
The local Army procurement offices
assigned preference ratings in accordance with a general pattern of
priorities approved before March 1942 by the Office of the Under Secretary
of War, which also
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endeavored to get agreement from
the Navy to follow the same or similar scheme of preferences. The Army would
then not assign higher or lower ratings to tents, or clothing, or medical
equipment than the Navy, or vice versa. The organizational device for
negotiating these agreements was the ANMB. This board was composed of two
persons, the Under Secretary of War and the Under Secretary of the Navy. In
December 1941 Mr. Patterson and Mr. James V Forrestal persuaded Mr.
Ferdinand Eberstadt, a New York financier, to join them as chairman of the
board. 2
A priorities system for guiding the
distribution of raw materials and component parts worked satisfactorily as
long as the supply exceeded demand. When demand began to catch up with and
outstrip supply, the establishment of priorities alone was inadequate. As
early as February 1941, OPM began to experiment with a new process of
allocating aluminum deliveries. This was the first, and for a long time the
only, metal whose military and other essential demand outran supply.
Gradually however, in 1941, civilian demands for raw materials and
industrial supplies expanded as the entire economy operated at increased
levels of output. As long as priorities insured adequate deliveries to
military contractors, the War Department was not directly concerned about
this situation. It recognized that the problem of insuring essential
civilian production belonged to the OPM, not to the War or Navy Departments.
Shortly after Pearl Harbor,
however, it became evident that the priorities system was collapsing. As
large new sums of money were appropriated for military supplies, Army and
Navy procurement officers raced one another in letting new contracts. On
each they assigned the prevailing preference rating for the item or items
involved. In a short time, contractors found that preference ratings were
simply licenses to hunt raw materials; they were no guarantee of delivery.
The whole system was being used for a purpose it had never been designed to
serve and it broke down badly.
Because manufacturers failed to get
materials with the preference ratings that had been assigned to them,
procurement officers began to upgrade ratings. As a result, the
differentiation in ratings upon which the Army and Navy had agreed and which
the OPM had approved in 1941 gradually became meaningless. Within the
preference rating A-1 there were subdivisions ranking from A-1-a to A-1 j.
Supposedly, in the name of the ANMB, the officers supervising procurement
operations in the Army and Navy Departments had agreed upon types of
equipment for each rating and even upon quantitative limitations. But these
agreements meant nothing in the face of existing supply demands and in the
absence of any means for enforcement. A procurement officer under pressure
to get delivery of machine guns, for example, increased the preference
rating to help the manufacturer. By early 1942, more than 55 percent of the
war production program was rated A-1-a by procurement officers. 3
There was another serious defect in the system. With military preference
ratings clogging the industrial system, few if any supplies of raw materials
were available for essential civilian production such as transportation, and
other public utilities,
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and industrial maintenance
requirements. The first reaction of OPM was to set up an allocation system
for crucial materials like steel, aluminum, and copper. Processors and
fabricators of these materials were required monthly or quarterly to submit
a record of their orders on hand, with preference ratings, to the
appropriate industry division of WPB (steel, aluminum, and copper). In
consultation with Army and Navy officers, the WPB industry division then
undertook to tell the processors and fabricators what were the most urgent
orders they should fill in the next month or quarter. This was called
allocation. But this process was not satisfactory to either the WPB or the
armed services since it was not easy to trace orders for raw materials up to
end-items of war output. In addition, there was no way of knowing when the
contractor with a high priority proposed to use the ordered material in
production.
It will be recalled that in his
letter of 15 May to Mr. Nelson, General Somervell had spoken of
"inadequate control over the supply of critical materials," and
the report he had transmitted had mentioned various weaknesses in the
existing practices. 4
But Somervell had not proposed a specific means of improving materials
controls. These were already being discussed by the representatives of the
two agencies. Two issues were involved. One had to do with a revision in the
preference rating, or priorities, system. The other had to do with the
introduction of a whole new system for controlling the distribution of
materials.
As early as 21 February 1942 the
Army and Navy Munitions Board, which theoretically at least was charged with
assigning military priorities, requested the Joint Chiefs of Staff to issue
a revised priorities directive. 5
Other agencies also pressed for a change. In the meantime the military
procurement officers continued to meet the problem by reshuffling
priorities. For example, on 11 March 1942, General Somervell asked for
assignment of priorities within the ASF, seeking first priority for about
half the Army Supply Programs. 6
Meanwhile various committees of the joint Chiefs of Staff 7
studied the relative urgency of military procurement programs; their
suggested amendments were presented to the JCS early in April 1942. 8
The Joint Chiefs accepted these recommendations and submitted them to
President Roosevelt. 9
The President concurred,
particularly approving the emphasis given to three classes of equipment:
aircraft and related items, shipping, and equipment for a decisive land and
air offensive. The President directed the JCS to ask the ANMB to establish
priorities within the services, 10
and wrote Donald Nelson a letter in which he enclosed his memorandum to the
military chiefs. The President expressed his assurance that the WPB would
assist the ANMB in this revision and would approve
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the necessary changes without
delay. 11
On 6 May the Joint Chiefs forwarded their approved proposal to the ANMB and
requested the board to prepare new priorities which would insure production
of the most urgent Army and Navy needs during the balance of 1942. 12
Mr. Eberstadt, chairman of the
ANMB, had been pressing for this kind of action since January 1942. In
addition, he wished to reform the priorities system by adopting new,
simplified designations, and by limiting the quantities of end-items for
which these ratings would be used to obtain raw materials. The Army and Navy
Munitions Board submitted a proposed priorities directive to Mr. Nelson on
20 May. It recommended five new preference ratings.
These were AA-1 to AA-4,
with an emergency classification of AAA. Second, it proposed that the
quantities of end-items of military equipment to be assigned these priority
ratings should be definitely limited. For example, the AA-1 preference
ratings were to be issued for 60,000 war planes, the Presidential objective,
together with critical and essential items of the Army Supply Program
necessary to equip these planes. For the Army, the AA-1 rating was to be
used for 50 percent of the major items in the revised Presidential objective
for the Ground Forces in 1942. This meant 50 percent, for example, of some
25,000 tanks, 10,000 pieces of heavy artillery, 25,000 antitank weapons, and
9,000 armored cars. Also the top rating was to be used for 50 percent of the
Maritime Commission's ship construction program of nine million dead-weight
tons, and for naval vessels which could be commissioned by 1 March 1943. The
AA-2 rating was to be assigned to the remaining items of the 1942
procurement program as approved by the President and to naval vessels
which could be commissioned between 1 April and 31 December 1943. The AA-3
category was to be used for aircraft equipment needed in 1942. to meet the
1943 objectives and to the Army Supply Program on the same basis. 13
The ANMB memorandum made no estimate of the raw material requirements needed
to fulfill the program. It did recommend that no priorities be granted for
civilian supplies which would compete with the military program, unless the
ANMB concurred.
The War Production Board received
the proposal with considerable hostility. As with other suggestions of a
similar nature, some WPB officials interpreted this as a move by the
military to take over control of the economy. On more technical grounds,
they also feared that the new priority system would interfere with the
Production Requirements Plan which was based on the spread of the old
priorities ratings. Because of these factors the WPB delayed approval. 14
On 30 May 1942 Mr. Eberstadt reported to the Under Secretaries of War and
the Navy about a meeting which had been held that day in Mr. Nelson's
office. The Statistical Division of WPB had made some preliminary
calculations about dollar amounts of production required by the proposal and
also about raw material requirements. In general, the raw material
requirements for the program were within available supplies except possibly
for aluminum. Mr.
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Eberstadt agreed that some effort
should be made to set up preference ratings for essential civilian supplies
and certain foreign raw material commitments which were not included within
the proposal. 15
Mr. Nelson was inclined to accept
the new priorities system over the objections of his staff. After all, the
proposed procedure had the tremendous advantage of setting quantitative
limits by time periods in the assignment of preference ratings to essential
needs. Some of the unbalanced production of the past might thereby be
avoided. The new system also provided for a workable relationship between
the War Production Board and the Army Service Forces. The WPB would approve
the over-all arrangement, and military procurement offices would assign
specific ratings to individual contractors within the limits of this
approval. The WPB would then police the assignment of ratings. Mr. Nelson
discussed the proposed directive with the President and secured his approval
of the recommendation that essential civilian needs should get higher
priorities.16
Then on 9 June, Nelson accepted the new priorities directive with certain
modifications which added additional merchant shipping and some 1942
production for 1943 end-items. The Joint Chiefs of Staff accepted the
modifications on 12 June. 17
Although the directive was
approved, the controversy over the magnitude of civilian production
continued unabated. The provision that the War Production Board had to
obtain the concurrence of the ANMB for preference ratings for civilian
programs was obnoxious to the WPB. Mr. Nelson told his assistants that the
maintenance of the civilian economy was their responsibility. They were to
consult the ANMB, but if they failed to get concurrence
they were to assign the rating regardless. The ANMB could then take its
appeals to him. 18
Early in July the Under
Secretaries of the War and
Navy Departments, and Chairman
Eberstadt protested that the production
goals set forth in the directive would
be hampered by failing to allocate raw
materials to programs in the stated order
of preference. Accordingly, they urged
that no additional ratings within the
primary categories should be issued without
the concurrence of the Army and Navy
Munitions Board. The memorandum recognized that "maintenance of a
sound economic basis for
continuance of the war
effort necessitated provision for certain
essential services and materials within
the framework of the priorities directive." It argued that such
essential requirements, however, should not be provided
at the expense of the munitions requirements
included in the AA-1 and AA-2
categories. The ANMB members asked
assurance that no items other than end-items
of munitions would be included in
end-items or put ahead of the AA-3 and AA-4
items without Army and Navy approval "excepting only such as may be
specifically directed by
you." 19
The ANMB also appealed to
the JCS, claiming that Mr. Nelson's action would prejudice the
"principle and intent" of the
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President's directive. 20
At the same time, the Under Secretaries also tried to impress their point of
view directly upon members of the War Production Board. In September 1942
the ANMB informed the JCS that the conflict over concurrences had been
adjusted. Thereupon the JCS dropped the issue from its agenda, and the WPB
added a new preference ratingAA-2X for urgent domestic and foreign
nonmilitary items. 21
Eventually, still higher priorities were given to various nonmilitary needs,
including use of the AA-1 rating. General Somervell and leading members of
his staff often challenged the magnitude of essential civilian requirements
as recommended by WPB committees, but there is no indication that they ever
took the position that civilian requirements finally determined to be
essential should not have a high rating.
The revised priorities directive
covered only vital war production for the last six months of 1942.
Subsequently, the same type of arrangement was continued for 1943 and 1944
production. The WPB charged that the ASF and other military procurement
agencies failed to observe strictly the quantitative limits in assigning
preference ratings.
The difficulty seemed to grow out of a desire for
flexibility in setting anticipated military production requirements, as well
as from the complexity of calculating needs in precise detail. Mr. Nelson,
dissatisfied with the way the services were handling their priorities
function and perhaps goaded by charges within his own agency of
"surrender" to the military, informed the Under Secretaries of War
and the Navy on 22 August 1942 that the WPB would "immediately
undertake supervision over functions now exercised by contracting and
procurement officers of the Armed Services with relation to the issuance of
priority orders and certificates." 22
He asserted that a control System "which must often restrict parts of
the program for the benefit of the whole," could not be supervised
effectively through field officers "whose primary function is
expediting the particular parts of the program entrusted to them."
Therefore, he requested the co-operation of the Army and Navy in assigning
military personnel to the WPB district offices "to advise" on the
issuance of preference ratings. The district offices (under the regional
offices) would receive proposed priority orders and certificates prepared
and forwarded by military procurement officers. The WPB would actually issue
rating and certificate. Nelson promised this would be done within
twenty-four hours. He ended by saying that he had issued orders to put the
new arrangement into effect on 7 September.
The announcement of this basic
change without prior consultation, coupled with the fear in military circles
that the WPB desired to take over Army procurement, threatened to produce a
direct clash. Fortunately, this was avoided in part by the action of Mr.
Eberstadt, who immediately began negotiations with WPB officials. Then on 27
August 1942 the armed services assured Nelson of their desire to cooperate
"in every way" in realizing his objective, but countered with a
suggested modification. 23
Their representatives commented that they were certain Mr. Nelson
[206]
realized the importance of
effecting a major change in priority procedure with a minimum of disturbance
to production. The limited time available to prepare for "so radical a
change" worried them. Accordingly, the services proposed that the WPB
should assign its own personnel to Army and Navy procurement offices to
approve their issuance of preference ratings. Nelson accepted the
counterproposal. The Army and Navy were satisfied with this because it
preserved, untouched, their direct relationship with contractors, and the
new method of supervising military issuance of preference ratings became
effective 10 September 1942. It remained in effect throughout most of the
war. The arrangement not only solved the priority issue but worked well, and
even provided a mutual protection to the Army and Navy against the other's
failing to carry out priorities agreements.
The problem of directing the
distribution of raw materials was still unresolved. Although the relative
importance of military items was now indicated, this alone was not
sufficient to insure that raw materials would go primarily to essential
production. One group within the Office of Production Management had
developed a scheme whereby certain industries might voluntarily submit
estimates of their raw materials demands for desired production programs. At
first this Production Requirements Plan was used almost exclusively by
industries producing nonmilitary items. From the point of view of the
industry, the arrangement was advantageous because it presented requirements
for a number of different metals needed to meet production schedules. OPM
liked the arrangement because it not only related raw material needs to
production plans but also revealed inventories on hand.
As dissatisfaction with existing
methods of allocating raw materials grew, both within the War Production
Board and the armed services, WPB began to consider the possibility of
applying the PRP to all American industry. On 4 March 1942 the director of
industry operations in WPB formally proposed to Mr. Nelson that PRP become a
mandatory system, covering an estimated 18,000 of the largest consumers of
raw materials who accounted for over 90 percent of the basic materials
fabricated in the country. 24
The plan would become general on 1 July 1942.
The story of PRP has been
adequately told elsewhere 25
but the reaction of the armed services to it is pertinent here. On 13 May
Mr. Nelson informed Under Secretaries -Patterson and Forrestal and Chairman
Eberstadt that the WPB had decided to apply the Production Requirements Plan
to all American manufacturers, including those who produced end-items of
munitions. The members of the ANMB replied on 20 May that they were
concerned about the possible consequence of such "precipitate
adoption" of PRP and expressed the hope that "no such action will
be taken without further and more thorough consideration of this
matter." They pointed out that there was still no agreement on a plan
for the most effective distribution of available raw materials. Patterson,
Forrestal, and Eberstadt recommended that a committee be appointed whose
members would be relieved of all duties save that of attempting to find
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a
satisfactory solution to the materials distribution problem. 26,
Mr. Nelson had already created a
WPB committee to consider raw materials controls. There was no direct
military representation on this committee and Nelson was not disposed to
change its composition. In the meantime Army and Navy personnel continued
their exploration of the mechanics of the proposed plan. On 28 May Mr.
Eberstadt submitted to Patterson and Forrestal a memorandum setting forth
his views about PRP, views, he said, which were shared by the principal Army
and Navy representatives working with him. He admitted that PRP would
produce substantial additional information about production requirements for
raw materials as well as much needed data on inventory positions, but he
held that it would provide only general information about the ultimate
destination of raw materials. While recognizing that there would be some
advantages from the system, Mr. Eberstadt expressed the strong opinion that
the administration of PRP would be an impossible task. Also he insisted that
the contemplated allocations process would still not insure distribution of
raw materials to the desired military end-items of production. In conclusion
he suggested that the effective date of the plan be postponed and that
further efforts be made to find an acceptable modification or substitute.
Under Secretaries Patterson and Forrestal forwarded Eberstadt's memorandum
to Nelson with the laconic notation: "We concur." 27
In spite of these protests the WPB
announced on 30 May that PRP would be introduced on a compulsory basis. On 8
June 1942 Mr. Eberstadt assured Mr. J. S. Knowlson, WPB director of industry
operations, that under the circumstances the Army
and Navy would do their best to see that "no harm resulted" from
the introduction of PRP. 28
During the next month Army and Navy officers worked closely with WPB
officials in an attempt to make the plan effective. But PRP failed. Though
it was clearly evident that the Army and Navy were opposed to the
arrangement, no charge was made within the WPB that the hostility of the
Army and the Navy was a major factor in bringing about its collapse. There
may indeed have been some justice in Mr. Knowlson's view that PRP
"apparently failed" more because the problem of total military
procurement requirements had not been solved than because of inherent
defects. The PRP might have been more successful also if there had been more
time to put it into operation, and if there had been more thorough
administrative preparation. Whatever the actual reason for the failure,
military authorities had forecast these difficulties rightly enough.
Army and Navy representatives
continued to urge a different procedure. On 1 June 1942 Mr. Eberstadt
created an Allocations Steering Committee with personnel drawn out of the
ASF, the Navy, the AAF, and the Maritime Commission. Members of this
committee were directed to work with WPB personnel in exploring further the
problems of materials control. As early as 8 May 1942 Mr. Eberstadt, with a
representative from the ASF and one from the Navy Office of Procurement and
Material, had explained a so-called warrant plan to a WPB committee. This
[208]
plan was further elaborated in
other papers which were presented to the War Production Board. For the
moment there was no immediate disposition within the WPB to accept the War
Department proposal. The failure of PRP, amid general industrial criticism,
brought the warrant plan once more to the fore. Large automobile
corporations like General Motors, as well as the steel industry, favored an
arrangement similar to that urged by the Army and the Navy. Mr. Ernest
Kanzler, who became WPB Director General of Operations early in September
1942, was further inclined toward the warrant system. Mr. Eberstadt and Mr.
Kanzler together made substantial progress in preparing a new system for
controlling materials. Then on 20 September 1942 Nelson announced the
appointment of Mr. Eberstadt as a vice-chairman of the WPB in charge of
program determination. At the same time, Nelson gave Eberstadt unofficial
assurance that he would be ,free to introduce a new system of materials
control.
With Mr. Eberstadt's appointment,
an extensive internal reorganization of the WPB was begun, and detailed
planning was started on a new system for controlling materials. On 2
November the WPB publicly announced the adoption of a Controlled Materials
Plan (CMP), to become fully effective on 1 July 1943 and applying primarily
to the allocation of steel, copper, and aluminum. 29
There was a basic difference between the Production Requirements Plan and
the Controlled Materials Plan which it is essential to observe. The two
systems were sometimes contrasted as "horizontal" as against
"vertical" allocation of raw materials. These terms in themselves
do not convey a full understanding of Army dissatisfaction with the first
and preference for the second. Under a system of horizontal allocation, as
in PRP, every important manufacturing concern in the United States was
expected individually to indicate its production schedules by quarter, its
corresponding needs for major shapes and forms of basic metals, and its raw
material inventories. The War Production Board would then receive all of
these estimates, consolidate them, compare raw material needs with supplies,
and inform each individual company of the quantities of materials which it
might obtain in a succeeding quarter. Under the vertical allocation scheme,
as in CMP, raw material requirements were presented to the WPB, not by
individual industries, but by so-called major claimants.
These were the ASF,
the Navy, the AAF, the Maritime Commission, and the civilian economy. The
WPB was responsible through its industry divisions for determining essential
civilian production requirements. The War Production Board then adjusted
demands to supply, and informed claimant agencies of the total quantity of
various metals which each might consume in a given quarter of a year. The
claimant agencies in turn apportioned their allocations to various
industries which placed their orders accordingly with raw material suppliers
. 30
Interestingly enough, in one
respect the horizontal and vertical systems of allocations had a common
meeting ground. There were certain kinds of industrial
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products which might be used as
component parts or subassemblies of many different items. These products
were sometimes called off-the-shelf items, or general industrial supplies.
Under the PRP horizontal allocation system, the manufacturers would obtain
raw material rights directly for such products. Under the CMP vertical
allocation, the manufacturer of general industrial supplies would have to
depend upon an eventual "trickling down" of many separate
allotments of raw materials from every end-product manufacturer who needed
his parts. The Controlled Materials Plan recognized this absurdity in
vertical allocation and set up a special category of Class B products. These
included such items as bearings, batteries, nuts and screws, steam
condensers, containers, electric generators, electric motors, mining
machinery, plumbing supplies, pumps, spark plugs, valves, and transformers.
Under CMP, manufacturers of Class B products received direct allotments of
raw materials from the War Production Board.
The essential difference between
horizontal allocation and vertical allocation was this. Under horizontal
allocation, the WPB received individual applications for raw materials from
18,000 or more separate industrial establishments. This imposed a terrific
operating burden upon a central agency. The WPB could sarcely have acted as
a top control agency concerned with broad issues of production balance. It
would have been submerged under literally thousands of operating details.
Vertical allocation, on the other hand, worked differently. The WPB received
its estimates of need from relatively few agencies, and each of these in
turn proceeded through successive organizational levels to divide up the job
of determining raw material requirements and controlling the distribution of
raw materials. Vertical allocation also preserved intact an intimate
association between a military procurement office and its prime contractor.
No third party with any authority to give separate instructions intervened
in this relationship. Horizontal allocation meant that the military
procurement office might let a contract and agree with the contractor upon
delivery schedules, but the contractor then had to go to another government
agency in order to obtain the raw materials needed to fulfill his contract.
Under it, the possibility that the contractor would receive conflicting
instructions was real. No one in the Army Service Forces ever maintained
that the Army should have an unlimited amount of raw materials. What the ASF
did say was: "Tell us how much steel, and copper, and aluminum we may
have, and we will then divide it in balanced proportions among our supply,
programs and inform our contractors what they can have and what they should
plan to produce." The ASF was satisfied when a method for controlling
the distribution of raw materials had been devised which preserved this
fundamental relationship between procurement office and contractor.
On 8 July 1942 Mr. Nelson announced
a "realignment" of internal WPB organization which, among other
things, was to clear "the decks to make controlling and expediting the
flow of materials the board's central effort." 31
All industry divisions were brought under single direction within the WPB.
But the ASF request for formal recognition of a working relationship with
these industry divisions was rejected. On 10 November 1942, after Mr.
Eberstadt
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had become a WPB vice-chairman, Mr.
Nelson approved organizational changes which did two principal things.
The
Director General for Operations in charge of industry divisions was put
under the Program Vice-Chairman (Mr. Eberstadt), and each industry division
was directed to form a division requirements committee on which there was to
be an Army and a Navy representative along with representatives of other
agencies such as the Maritime Commission and the Board of Economic Warfare. 32
This officially recognized an existing situation, for Army and Navy
personnel, in the name of the ANMB, had been physically located in WPB
offices for a long time. The job of these Army officers, who were a part of
the Production Division in ASF headquarters, was to keep in touch with the
production situation in various industries and to inform the industry
divisions of ASF military requirements. The Army representatives helped the
WPB in fixing production policies, and the WPB in turn helped the ASF
greatly in improving its requirements data and in following industrial
conditions. At this working level, ASF-WPB relations were cordial and
co-operative throughout the war.
The November WPB reorganization
realized two major ends which General Somervell had in mind when he gave his
"black book" to Mr. Nelson for consideration on 15 May. The
internal organization of WPB was now fully oriented to make the distribution
of raw materials its major task, and ASF participation had been officially
recognized at various working levels within WPB.
By the end of 1942 there was every
indication that economic mobilization for vital military needs would go
forward unimpeded. But such was not to be the case.
The Army-WPB controversy flared up
anew with a bitterness more intense than ever when on 16 February 1943 Mr.
Eberstadt was summarily dismissed from the WPB by Mr. Nelson. This, in the
words of columnist David Lawrence, was a "solar plexus blow to the Army
and Navy." 33
The story is told in Mr. Nelson's memoirs and in the official WPB history. 34
Nelson says that he learned suddenly one night that the Army was determined
to have him fired the next day. He does not identify his personal antagonist
or antagonists in the War Department. He notes that Secretary Stimson
recommended this action to the President, but acknowledges that the
Secretary of War had to take responsibility for such recommendation,
regardless of who may have instigated it. The WPB history more carefully
reports that an internal WPB jurisdictional conflict between Eberstadt and
Mr. Charles E. Wilson had reached the point where James F Byrnes, then
director of the Office of Economic Stabilization, joined by the Secretaries
of War and the Navy, recommended Mr. Nelson's removal to President
Roosevelt. Mr. Baruch was to be appointed in Nelson's place. 35
General Somervell was at the
Casablanca Conference in January 1943 and had no direct part in this effort
to replace Nelson with Baruch. But months earlier in the midst of another
dispute, when he had charged Nelson with trying to take away Army and Navy
control over war material, Somervell had suggested to President Roosevelt's
chief of staff, Admiral William D. Leahy, that Nelson
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should
be replaced by Bernard Baruch. 36
In any event, Nelson dismissed Mr.
Eberstadt and so preserved his position for the time being. Mr. Wilson then
emerged as the active head of WPB. He immediately informed General Clay,
Somervell's procurement deputy, and later General Somervell, that he
contemplated no change in the Controlled Materials Plan or, in existing
ASF-WPB relationships. This was adequate reassurance, and there was no
reason for Somervell to concern himself further with the matter. ASF
officials found Mr. Wilson increasingly satisfactory to work with;
relationships were cordial and effective.
During 1942 there were vigorous
discussions between Army and WPB officials about desirable procedure for the
control of raw materials. Once the Controlled Materials Plan had been
devised and accepted, previous disagreements subsided. CMP continued to give
the WPB effective control over the supply and distribution of raw materials.
This was as the ASF wished. General Somervell had never quarreled with WPB
authority but constantly urged effective action. Throughout 1943, 1944, and
1945, there were no more serious disagreements about raw material
procedures. A satisfactory working arrangement had finally been found.
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Page Created June 13th 2001
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