L. Frank Baum

On May 18, 1917, President Wilson issued a proclamation in which are to be found the following significant sentences:

In the sense in which we have been wont to think of armies there are no armies in this struggle, there are entire nations armed. Thus, the men who remain to till the soil and man the factories are no less a part of the army that is in France than the men beneath the battle flags. It must be so with us. It is not an army that we must shape and train for war—it is a Nation. To this end our people must draw close in one compact front against a common foe. But this cannot be if each man pursues a private purpose. All must pursue one purpose. The Nation needs all men, but it needs each man, not in the field that will most pleasure him, but in the endeavor that will best serve the common good. Thus, though a sharpshooter pleases to operate a trip-hammer for the forging of great guns, and an expert machinist desires to march with the flag, the Nation is being served only when the sharpshooter marches and the machinist remains at his levers. The whole Nation must be a team, in which each man shall play the part for which he is best fitted.

If President Wilson deserves severe criticism for his failure to endorse adequate plans of preparation for war while his country was at peace, he should be given due credit for his appreciation that the home front must be organized if the fighting front was to be victorious. He perceived clearly that it was necessary to carry into the industrial life of the nation that centralizing process which characterized his military policy. That the nation at home was made to feel itself part of the fighting forces and coÖperated enthusiastically and effectively in the organization of the national resources was not the least of the triumphs of the United States. Such organization demanded great sacrifice, not merely of luxuries or comforts, but of settled habits, which are difficult to break. It must necessarily be of an emergency character, for the United States possessed no bureaucratic system like that which obtains on the continent of Europe for the centralization of trade, manufactures, food production, and the thousand activities that form part of economic life. But the event proved that both the spirit and the brains of the American people were equal to the crisis.The problem of coÖrdinating the national industries for the supply of the army was complicated by the military decentralization described in the preceding chapter, which President Wilson was not able to remedy before the final months of the war. The army did not form or state its requirements as one body but through five supply bureaus, which acted independently and in competition with each other. Bids for materials from the different bureaus conflicted with each other, with those of the navy, and of the Allies. Not merely was it essential that such demands should be coÖrdinated, but that some central committee should be able to say how large was the total supply of any sort of materials, how soon they could be produced, and to prevent the waste of such materials in unessential production. If the army was decentralized, American industry as a whole was in a state of complete chaos, so far as any central organization was concerned. On the side of business every firm in every line of production was competing in the manufacture of essential and unessential articles, in transportation, and in bidding for and holding the necessary labor. Mr. Wilson set himself the task of evolving order out of this chaos.The President, as in the purely military problem where he utilized the General Staff as his instrument, prepared to adapt existing machinery, rather than to create a completely new organization. For a time he seems to have believed that his Cabinet might serve the function. But it was ill-adapted to handle the sort of problems that must be solved. It was composed of men chosen largely for political reasons, and despite much public complaint it had not been strengthened after Wilson's reËlection. Franklin K. Lane, the Secretary of the Interior, was generally recognized as a man of excellent business judgment, willing to listen to experts, and capable of coÖperating effectively with the economic leaders of the country. His influence with the President, however, seemed to be overshadowed by that of Newton D. Baker and William G. McAdoo, Secretaries of War and of the Treasury, who had inspired the distrust of most business men. McAdoo in particular alienated financial circles because of his apparent suspicion of banking interest, and both, by their appeals to laboring men, laid themselves open to the charge of demagogic tactics. Robert Lansing, the Secretary of State, had won recognition as an expert international lawyer of long experience, but he could not be expected to exercise great influence, inasmuch as the President obviously intended to remain his own foreign secretary. Albert S. Burleson, Postmaster-General, was a politician, expert in the minor tactics of party, whose conduct of the postal and telegraphic systems was destined to bring a storm of protest upon the entire Administration. Thomas W. Gregory, the Attorney-General, had gained entrance into the Cabinet by means of a railroad suit which had roused the ire of the transportation interests. The other members were, at that time, little known or spoken of. Wilson spent much time and effort in defending his Cabinet members from attacks, and yet it was believed that he rarely appealed to them for advice in the formulation of policies. Thus the Cabinet as a whole lacked the very qualities essential to a successful organizing committee: ability to secure the coÖperation and respect of the industrial leaders of the country.

Titular functions of an organizing character, nevertheless, had been conferred upon six members of the Cabinet in August, 1916, through the creation of a "Council of National Defense"; they were charged with the "coÖrdination of industries and resources for the national security and welfare." The actual labor of coÖrdination, however, was to be exercised by an advisory commission of seven, which included Howard E. Coffin, in charge of munitions, Daniel Willard, president of the Baltimore and Ohio Railroad, in charge of transportation, Julius Rosenwald, president of the Sears-Roebuck Company, in charge of supplies including clothing, Bernard M. Baruch, a versatile financial trader, in charge of metals, minerals, and raw materials, Samuel Gompers, president of the American Federation of Labor, in charge of labor and the welfare of workers, Hollis Godfrey in charge of engineering and education, and Franklin H. Martin in charge of medicine. The commission at once prepared to lay down its programme, to create sub-committees and technical boards, and to secure the assistance of business leaders, without whose coÖperation their task could not be fulfilled.

Following plans developed by the Council of National Defense, experts in every business likely to prove of importance were called upon to coÖrdinate and stimulate war necessities, to control their distribution, to provide for the settlement of disputes between employers and wage-earners, to fix prices, to conserve resources. Scientific and technical experts were directed in their researches. The General Medical Board and the Committee on Engineering and Education were supervised in their mobilization of doctors and surgeons, engineers, physicists and chemists, professors and graduate students in the university laboratories. Everywhere and in all lines experience and brains were sought and utilized. State Councils of Defense were created to oversee the work of smaller units and to establish an effective means of communication between the individual and the national Government. Naturally much over-organization resulted and some waste of time and energy; but the universal spirit of voluntary coÖperation evoked by the Councils overbalanced this loss and aided greatly in putting the country on an effective war basis. As Wilson said, "beyond all question the highest and best form of efficiency is the spontaneous coÖperation of a free people." In return for their efforts the people received an education in public spirit and civic consciousness such as could have come in no other way.

Of the committees of the Council, that on munitions developed along the most elaborate lines, becoming of such importance that on July 28, 1917, it was reorganized as the War Industries Board. As such it gradually absorbed most of the functions of the Council which were not transferred to other agencies of the Government. During the autumn of 1917 the activities of the Board underwent rapid extension, but it lacked the power to enforce its decisions. As in the case of the General Staff, it was important that it should have authority not merely to plan but also to supervise and execute. Such a development was foreshadowed in the reorganization of the Board in March, 1918, under the chairmanship of Bernard M. Baruch, and when the President received the blanket authority conferred by the Overman Act, he immediately invested the War Industries Board with the centralizing power which seemed so necessary. Henceforth it exercised an increasingly strict control over all the industries of the country.

The purpose of the Board was, generally speaking, to secure for the Government and the Allies the goods essential for making war successfully, and to protect the civil needs of the country. The supply of raw materials to the manufacturer as well as the delivery of finished products was closely regulated by a system of priorities. The power of the Board in its later development was dictatorial, inasmuch as it might discipline any refractory producer or manufacturer by the withdrawal of the assignments he expected. The leaders of each of the more important industries were called into council, in order to determine resources and needs, and the degree of preference to which each industry was entitled. Some were especially favored, in order to stimulate production in a line that was of particular importance or was failing to meet the exigencies of the military situation; shipments to others of a less essential character were deferred. Committees of the Board studied industrial conditions and recommended the price that should be fixed for various commodities; stability was thus artificially secured and profiteering lessened. The Conservation Division worked out and enforced methods of standardizing patterns in order to economize materials and labor. The Steel Division coÖperated with the manufacturers for the speeding-up of production; and the Chemical Division, among other duties, stimulated the vitally important supply of potash, dyes, and nitrates. Altogether it has been roughly estimated that the industrial capacity of the country was increased by twenty per cent through the organizing labors and authority of the War Industries Board.

The success of this Board would have been impossible without the building up of an extraordinary esprit de corps among the men who were brought face to face with these difficult problems of industry and commerce. Their chairman relied, of course, upon the coÖperation of the leaders of "big business," who now, in the hour of the country's need, sank their prejudice against governmental interference and gave freely of their experience, brains, and administrative power. Men whose incomes were measured in the hundreds of thousands forgot their own business and worked at Washington on a salary of a dollar a year.

The same spirit of coÖperation was evoked when it came to the conservation and the production of food. If steel was to win the war, its burden could not be supported without wheat, and for some months in 1917 and 1918 victory seemed to depend largely upon whether the Allies could find enough to eat. Even in normal times Great Britain and France import large quantities of foodstuffs; under war conditions they were necessarily dependent upon foreign grain-producing countries. The surplus grain of the Argentine and Australia was not available because of the length of the voyage and the scarcity of shipping; the Russian wheat supply was cut off by enemy control of the Dardanelles even before it was dissipated by corrupt officials or reckless revolutionaries. The Allies, on the verge of starvation, therefore looked to North America. Yet the stock of cereals when the United States entered the war was at a lower level than it had been for years and the number of food animals had also been reduced.

To meet the crisis President Wilson called upon one of the most interesting and commanding personalities of modern times. Herbert Clark Hoover was a Californian mining engineer, of broad experience in Australia, China, and England, who in 1914 had been given control of Allied Relief abroad. The following year he undertook the difficult and delicate task of organizing food relief for Belgium. He was able to arouse the enthusiastic sympathy of Americans, win financial support on a large scale, procure the much-needed food, and provide for its effective distribution among the suffering Belgians, in spite of the suspicions of the Germans and the hindrances thrown in his path. A master organizer, with keen flair for efficient subordinates, of broad vision never muddied by details, with sound knowledge of business economics, and a gift for dramatic appeal, Hoover was ideally fitted to conduct the greatest experiment in economic organization the world had seen. Unsentimental himself, he knew how to arouse emotion—a necessary quality, since the food problem demanded heavy personal sacrifices which would touch every individual; brusque in manner, he avoided giving the offense which naturally follows any interference with the people's dinner and which would destroy the essential spirit of voluntary coÖperation.

Five days after the declaration of war, President Wilson, through the Council of National Defense, named a committee on food supply, with Hoover at its head, and shortly thereafter named him food commissioner. Hoover began his work of educating the people to realize the necessity of economy and extra-production; but he lacked the administrative powers which were essential if his work was to prove effective, and it was not until August that Congress passed the Lever Act which provided for strict control of food under an administrator. This measure encountered strong opposition in the Senate and from the farmers, who feared lest the provisions against hoarding of food would prevent them from holding their products for high prices. Wilson exerted his personal influence vigorously for the bill in the face of congressional opposition, which demanded that large powers of control should be given to a Senate committee of ten, and he was finally successful in his appeal. He thereupon appointed Hoover Food Administrator with practically unlimited powers, legalizing the work already begun on his own initiative.

Hoover at once made arrangements to prevent the storage of wheat in large quantities and to eliminate speculative dealings in wheat on the grain exchanges. He then offered to buy the entire wheat crop at a fair price and agreed with the millers to take flour at a fair advance on the price of wheat. Fearful lest the farmers should be discouraged from planting the following year, 1918, he offered to buy all the wheat that could be raised at two dollars a bushel. If peace came before the crop was disposed of, the Government might be compelled to take over the wheat at a higher price than the market, but the offer was a necessary inducement to extensive planting. In the meantime Hoover appealed to the country to utilize every scrap of ground for the growing of food products. Every one of whatever age and class turned gardener. The spacious and perfectly trimmed lawns of the wealthy, as well as the weed-infested back yards of the poor, were dug up and planted with potatoes or corn. Community gardens flourished in the villages and outside of the larger towns, where men, women, and children came out in the evening, after their regular work, to labor with rake and hoe. There were perhaps two million "war gardens" over and beyond the already established gardens, which unquestionably enabled many a citizen to reduce his daily demands on the grocer, and stimulated his interest in the problem of food conservation. As a result of Hoover's dealing with the farmers, during the year 1917 the planted wheat acreage exceeded the average of the preceding five years by thirty-five million acres, or by about twelve per cent, and another additional five million acres were planted in 1918. The result was the largest wheat crop in American history except that of 1915, despite the killing cold of the winter of 1917 and the withering drought of the summer of 1918. An increase in the number of live stock was also secured and the production of milk, meat, and wool showed a notable development.

Hoover achieved equal success in the problem of conserving food. He realized that he must bring home to the individual housewife the need of the closest economy, and he organized a nation-wide movement to secure voluntary pledges that the rules and requests of the Food Administration would be observed. People were asked to use other flours than wheat whenever possible, to be sparing of sugar and meat, to utilize substitutes, and rigidly to avoid waste. On every billboard and in all the newspapers were to be seen appeals to save food. Housewives were enrolled as "members of the Food Administration" and were given placards to post in their windows announcing their membership and the willingness of the family to abide by its requests. Certain days of the week were designated as "wheatless" or "meatless" when voluntary demi-fasts were to be observed, the nonobservance of which spelled social ostracism. To "Hooverize" became a national habit, and children were denied a spoonful of sugar on their cereal, "because Mr. Hoover would not like it." Hoover, with his broad forehead, round face, compelling eyes, and underhung jaw, became the benevolent bogey of the nation. It was a movement of general renunciation such as no country had undergone except at the pinch of biting necessity.[7] In the meantime prices were prevented from rapid increase by a system of licenses, which tended to prevent hoarding or speculation. Attempts to capitalize the need of the world for private gain, or in common parlance, to "profiteer," were comparatively rare and were adequately punished by revocation of license or by forced sale of hoardings.

As a result of the organization of food supply, the stimulation of production, and the prevention of waste, America was able to save the Entente nations, and, later, much of central and southeastern Europe from starvation, without herself enduring anything worse than discomfort. The Government was able at the same time to provide the troops in France with food which, to the poilus at least, seemed luxurious. When the United States entered the war the country was prepared to export 20,000,000 bushels of wheat; instead it sent over 141,000,000. In four months, in the summer of 1918, the American people saved out of their regular consumption and sent abroad half a million tons of sugar. The autumn of 1918 saw an increase of nearly a million tons of pork products over what was available the previous year. Altogether, during the crop year of 1918, America doubled the average amount of food sent to Europe immediately before the war, notwithstanding unfavorable weather conditions and the congestion of freight that resulted from other war necessities. The total contribution in foodstuffs exported to Europe that year amounted to a value of about two billion dollars. This was done without food cards and with a minimum of edicts. It was the work of education and conscience.

Fuel like food was a war necessity and there was equal need of stimulating production by assuring a fair profit and of eliminating all possible waste. Without the steam power provided by coal, raw materials could not be transformed into the manufactured articles demanded by military necessity, nor distributed by the railroads and steamships. Soon after the declaration of war, a committee of coal operators, meeting under the authorization of the Council of National Defense, drew up a plan for the stimulation of coal production and its more economical distribution. This committee voluntarily set a price for coal lower than the current market price, in order to prevent a rise in manufacturing costs; it was approved by the Secretary of the Interior, who warmly praised the spirit of sacrifice displayed by the operators. Unfortunately the Secretary of War, as chairman of the Council of National Defense, repudiated the arrangement, on the ground that the price agreed upon was too high. The operators were discouraged, because of the difficulty of stimulating production under the lower price which Secretary Baker insisted upon; they were further disappointed at the postponement of plans for a zone system and an elimination of long cross hauls, designed to relieve the load that would be thrown upon railroad transportation in the coming winter.

In August, Wilson was empowered by the Lever Act to appoint a Fuel Administrator and chose Harry A. Garfield, President of Williams College. Conditions, however, became more confused. The fuel problem was one of transportation quite as much as of production; the railroads were unable to furnish the needed coal-cars, and because of an expensive and possibly unfair system of car allotment, coal distribution was hampered. Add to this the fact that numerous orders for coal shipments had been deferred until autumn, in the belief that the Administration, which in the person of Baker was not believed to look on the coal operators with favor, would enforce low prices. Hence during the last three months of the year an unprecedented amount of coal had to be shipped, and the congestion on the competing railroads was such that the country faced a real coal famine. In December, the Government recognized the obvious fact that the railroad must be placed under one management, if the confusion in the whole industrial situation were to be eliminated. President Wilson accordingly announced that the Federal Government would take over the railroads for the period of the war.

This measure came too late to save the country from the evil effects of the fuel shortage. The penalty for the delays of the preceding summer had to be paid, and it was the heavier because of the severity of the winter. Overloaded trains were stalled and harbors froze over, imprisoning the coal barges. Thirty-seven ships laden with essential military supplies were held up in New York harbor for lack of fuel, and long strings of empties blocked the sidings, while the shippers all over the country cried for cars. To meet the crisis Garfield decreed that all manufacturing plants east of the Mississippi should be shut down for five days and for a series of Mondays, until the 25th of March. The order applied also to places of amusement, private offices, and most stores, which were not allowed to furnish heat. Munitions plants and essential industries, as well as Government offices were naturally excepted. "Heatless Mondays" caused great inconvenience and bitter criticism, for they came at the moment when it was most important that the economic life of the nation should be functioning at its greatest efficiency. But the embargo helped to tide over the crisis. As in the case of food, the public, once it appreciated the necessity of the situation, accepted it cheerfully. Domestic economy was also widely preached and applied, to the slogan, "Save a shovelful of coal a day." The elimination of electric advertisements and the diminution of street lighting, served to lessen the non-essential demand for coal; and the crisis also forced the introduction of "daylight saving," the advancement of the clock by an hour, during the months extending from March to October, thus saving artificial light.

In the meantime the Fuel Administration, the operators, and the miners were coÖperating to increase coal production. The enthusiasm of the mine workers was stimulated by making them realize that they were indeed part of the fighting forces. A competitive spirit was aroused and mining conditions were bettered to keep them satisfied. Labor responded to the call. Holidays were omitted and emulation between different shifts became keen.[8] Increased production was paralleled by more efficient distribution. A zone system, finally put into operation, eliminated approximately 160,000,000 car miles. Local fuel administrators kept in constant touch with the need of the localities under their jurisdiction, studied methods of abolishing unnecessary manufacturing use of coal and refused coal to non-essential industries.

Similar increase in the production and saving of oil was accomplished. The oil-burning vessels of the allied navies and merchant marines, the motor transport service of the armies, all made this necessary. In 1918 the production of oil in the United States was fourteen per cent greater than in 1914. In response to an urgent cable from Marshal Foch, which ran: "If you don't keep up your petrol supply we shall lose the war," a series of "gasless Sundays" was suggested. For nearly two months, merely at the request of the Fuel Administration and without any compulsion except that arising from public opinion, Sunday motoring was practically abandoned. That most crowded of motor thoroughfares, the Boston Post Road from New York to Stamford, might have served as playground for a kindergarten. The estimated saving of gasoline amounted to a million barrels: about four per cent of the gasoline sent abroad in 1918 was provided by the gasless Sundays.

Credit must be given the Fuel Administration for the large measure of success which it finally secured. It was slow in its early organization and at first failed to make full use of the volunteer committees of coal operators and labor representatives who offered their assistance and whose experience qualified them to give invaluable advice. But Garfield showed his capacity for learning the basic facts of the situation, and ultimately chose strong advisers. When he entered upon his duties he found the crisis so far advanced that it could not be immediately solved. Furthermore, in a situation which demanded the closest coÖperation between the Fuel and the Railroad Administration, he did not always receive the assistance from the latter which he had a right to expect.

As a war measure, the temporary nationalization of the railroads was probably necessary. Whatever the ultimate advantages of private ownership and the system of competition, during the period of military necessity perfect coÖrdination was essential. Railroad facilities could not be improved because new equipment, so far as it could be manufactured, had to be sent abroad; the only solution of the problem of congestion seemed to be an improvement of service. During the first nine months after the declaration of war a notable increase in the amount of freight carried was effected; nevertheless, as winter approached, it became obvious that the roads were not operating as a unit and could not carry the load demanded of them. Hence resulted the appointment of McAdoo in December, 1917, as Director-General, with power to operate all the railroads as a single line.

During the spring of 1918 the Administration gradually overcame the worst of the transportation problems. To the presidents and management of the various railroads must go the chief share of credit for the successful accomplishment of this titanic task. Despite their distrust of McAdoo and their objections to his methods, they coÖperated loyally with the Railroad Administration in putting through the necessary measures of coÖrdination and in the elimination of the worst features of the former competitive system. They adopted a permit system which prevented the loading of freight unless it could be unloaded at its destination; they insisted upon more rapid unloading of cars; they consolidated terminals to facilitate the handling of cars; they curtailed circuitous routing of freight; they reduced the use of Pullman cars for passenger service. As a result, after May, 1918, congestion was diminished and during the summer was no longer acute. This was accomplished despite the number of troops moved, amounting during the first ten months of 1918 to six and a half millions. In addition the railroads carried large quantities of food, munitions, building materials for cantonments, and other supplies, most of which converged upon eastern cities and ports. The increase in the number of grain-carrying cars alone, from July to November, was 135,000 over the same period of the previous year.

Unquestionably the Government's administration of the railroads has a darker side. Complaints were frequent that the Railroad Administration sacrificed other interests for its own advantage. The future of the roads was said not to be carefully safeguarded, and equipment and rolling stock mishandled and allowed to deteriorate. Above all, at the moment when it was quite as essential to preserve the morale of labor on the home front as that of the troops in France, McAdoo made concessions to labor that were more apt to destroy discipline and esprit de corps than to maintain them. The authority given for the unionization of railroad employees, the stopping of piecework, the creation of shop committees, weakened the control of the foremen and led to a loss of shop efficiency which has been estimated at thirty per cent. Government control was necessary, but in the form in which it came it proved costly.

During the months when manufacturing plants were built and their output speeded up, when fuel and food were being produced in growing amounts, when the stalled freight trains were being disentangled, there was unceasing call for ocean-going tonnage. Food and war materials would be of little use unless the United States had the ships in which to transport them across the Atlantic. The Allies sorely needed American help to replace the tonnage sunk by German submarines; during some months, Allied shipping was being destroyed at the rate of six million tons a year. Furthermore if an effective military force were to be transported to France, according to the plans that germinated in the summer of 1917, there would be need of every possible cubic inch of tonnage. The entire military situation hinged upon the shipping problem. Yet when the United States joined in war on Germany there was not a shipyard in the country which would accept a new order; every inch of available space was taken by the navy or private business.

In September, 1916, the United States Shipping Board had been organized to operate the Emergency Fleet Corporation, which had been set up primarily to develop trade with South America. This body now prepared a gigantic programme of shipbuilding, which expanded as the need for tonnage became more evident. By November 15, 1917, the Board planned for 1200 ships with dead weight tonnage of seven and a half millions. The difficulties of building new yards, of collecting trained workmen and technicians were undoubtedly great, but they might have been overcome more easily had not unfortunate differences developed between William Denman, the chairman of the Board, who advocated wooden ships, and General George W. Goethals, the head of the Emergency Fleet Corporation, who depended upon steel construction. The differences led to the resignation of both and continued disorganization hampered the rapid fulfillment of the programme Edward N. Hurley became chairman of the Shipping Board, but it was not until the spring of 1918, when Charles M. Schwab of the Bethlehem Steel Company was put in charge of the Emergency Fleet Corporation as Director General of shipbuilding, that public confidence in ultimate success seemed justified.

Much of the work accomplished during the latter days of the war was spectacular. Waste lands along the Delaware overgrown with weeds were transformed within a year into a shipyard with twenty-eight ways, a ship under construction on each one, with a record of fourteen ships already launched. The spirit of the workmen was voiced by the placard that hung above the bulletin board announcing daily progress, which proclaimed, "Three ships a week or bust." The Hog Island yards near Philadelphia and the Fore River yards in Massachusetts became great cities with docks, sidings, shops, offices, and huge stacks of building materials. Existing yards, such as those on the Great Lakes, were enlarged so that in fourteen months they sent to the ocean a fleet of 181 steel vessels. The new ships were standardized and built on the "fabricated" system, which provided for the manufacture of the various parts in different factories and their assembling at the shipyards. In a single day, July 4, 1918, there were launched in American shipyards ninety-five vessels, with a dead weight tonnage of 474,464. In one of the Great Lakes yards a 5500 ton steel freighter was launched seventeen days after the keel was laid, and seventeen days later was delivered to the Shipping Board, complete and ready for service.

This work was not accomplished without tremendous expenditure and much waste. The Shipping Board was careless in its financial management and unwise in many of its methods. By introducing the cost plus system in the letting of contracts it fostered extravagance and waste and increased and intensified the industrial evils that had resulted from its operation in the building of army cantonments. The contractors received the cost of construction plus a percentage commission; obviously they had no incentive to economize; the greater the expense the larger their commission. Hence they willingly paid exorbitant prices for materials and agreed to "fancy" wages. Not merely was the expense of securing the necessary tonnage multiplied, but the cost of materials and labor in all other industries was seriously enhanced. The high wages paid tended to destroy the patriotic spirit of the shipworkers, who were enticed by greed rather than by the glory of service. The effect on drafted soldiers was bound to be unfortunate, for they could not but realize the injustice of a system which gave them low pay for risking their lives, while their friends in the shipyards received fabulous wages. Such aspects of the early days of the Shipping Board were ruthlessly re-formed by Schwab when he took control of the Emergency Fleet Corporation. Appealing to the patriotism of the workers he reduced costs and increased efficiency, according to some critics, by thirty per cent, according to others, by no less than one hundred and ten per cent.

By September, 1918, the Shipping Board had brought under its jurisdiction 2600 vessels with a total dead weight tonnage of more than ten millions. Of this fleet, sixteen per cent had been built by the Emergency Fleet Corporation. The remainder was represented by ships which the Board had requisitioned when America entered the war, by the ships of Allied and neutral countries which had been purchased and chartered, and by interned enemy ships which had been seized. The last-named were damaged by their crews at the time of the declaration of war, but were fitted for service with little delay by a new process of electric welding. Such German boats as the Vaterland, rechristened the Leviathan, and the George Washington, together with smaller ships, furnished half a million tons of German cargo-space. The ships which transported American soldiers were not chiefly provided by the Shipping Board, more than fifty per cent being represented by boats borrowed from Great Britain.[9]

More effective use of shipping was fostered by the War Trade Board, which had been created six months after the declaration of war by the Trading with the Enemy Act (October 6, 1917), and which, in conjunction with the activities of the Alien Property Custodian, possessed full powers to curtail enemy trade. It thereby obtained practical control of the foreign commerce of this country, and was able both to conserve essential products for American use and to secure and economize tonnage.Such control was assured through a system of licenses for exports and imports. No goods could be shipped into or out of the country without a license, which was granted by the War Trade Board only after investigation of the character of the shipment and its destination or source. The earlier export of goods which had found their way to Germany through neutral countries was thus curtailed and the blockade on Germany became strangling. Products necessary to military effectiveness were secured from neutral states in return for permission to buy essentials here. Two millions of tonnage were obtained from neutral states for the use of the United States and Great Britain. Trade in non-essentials with the Orient and South America was limited, extra bottoms were thus acquired, and the production of non-essentials at home discouraged. Altogether, the War Trade Board exercised tremendous powers which, however necessary, might have provoked intense resentment in business circles; but these powers were enforced with a tact and discretion characteristic of the head of the Board, Vance McCormick, who was able successfully to avoid the irritation that might have been expected from such governmental interference with freedom of commerce.The problem of labor was obviously one that must be faced by each of the war boards or administrations, and nearly all of them were compelled to establish some sort of labor division or tribunal within each separate field. The demands made upon the labor market by war industry were heavy, for the withdrawal of labor into the army created an inevitable scarcity at the moment when production must be increased, and the different industries naturally were brought to bid against each other; the value of any wage scale was constantly affected by the rising prices, while the introduction of inexperienced workmen and women affected the conditions of piecework, so that the question of wages and conditions of labor gave rise to numerous discussions. The Labor Committee of the Council of National Defense had undertaken to meet such problems as early as February, 1917, but it was not until the beginning of the next year that the Department of Labor underwent a notable reorganization with the purpose of effecting the coÖrdination necessary to complete success.

Unlike the food, fuel, and transportation problems, which were solved through new administrations not connected with the Department of Agriculture, the Bureau of Mines, or the Interstate Commerce Commission respectively, that of labor was met by new bureaus and boards which were organic parts of the existing Department of Labor. In January, 1918, that Department undertook the formulation and administration of a national war labor policy. Shortly afterwards delegates of the National Industrial Conference Board and of the American Federation of Labor, representing capital and labor, worked out a unanimous report upon the principles to be followed in labor adjustment. To enforce these recommendations the President, on April 9, 1918, appointed a National War Labor Board, which until November sat as a court of final appeal in labor disputes. An index of the importance of the Board was given by the choice of ex-President Taft as one of its chairmen. A month later, a War Labor Policies Board was added to the system to lay down general rules for the use of the War Labor Board in the rendering of its judgments.

Not merely enthusiasm and brains enabled America to make the extraordinary efforts demanded by the exigencies of war. Behind every line of activity lay the need of money: and the raising of money in amounts so large that they passed the comprehension of the average citizen, forms one of the most romantic stories of the war. It is the story of the enthusiastic coÖperation of rich and poor: Wall Street and the humblest foreign immigrants gave of their utmost in the attempt to provide the all-important funds for America and her associates in the war. Citizens accepted the weight of income and excess profit taxes far heavier than any American had previously dreamed of. They were asked in addition to buy government bonds to a total of fourteen billions, and they responded by oversubscribing this amount by nearly five billions. Of the funds needed for financing the war, the Government planned to raise about a third by taxation, and the remainder by the sale of bonds and certificates maturing in from five to thirty years. It would have proved the financial statesmanship of McAdoo had he dared to raise a larger proportion by taxation; for thus much of the inflation which inevitably resulted from the bond issues might have been avoided. But the Government feared alike for its popularity and for the immediate effect upon business, which could not safely be discouraged. As it was, the excess profit taxes aroused great complaint. The amount raised in direct taxation represented a larger proportion of the war budget than any foreign nation had been able to secure from tax revenues.

In seeking to sell its bonds the Government, rather against its will, was compelled to rely largely upon the capitalists. The large popular subscriptions would have been impossible but for the assistance and enthusiasm shown by the banks in the selling campaign. Wall Street and the bankers of the country were well prepared and responded with all their strength, a response which deserves the greater credit when we remember the lack of sympathy which had existed between financial circles and President Wilson's Administration. Largely under banking auspices the greatest selling campaign on record was inaugurated. Bonds were placed on sale at street corners, in theaters, and restaurants; disposed of by eminent operatic stars, moving-picture favorites, and wounded heroes from the front. Steeple jacks attracted crowds by their perilous antics, in order to start the bidding for subscriptions. Villages and isolated farmhouses were canvassed. The banks used their entire machinery to induce subscriptions, offering to advance the subscription price. When during the first loan campaign the rather unwise optimism of the Treasury cooled enthusiasm for a moment, by making it appear that the loan could be floated without effort, Wall Street took up the load. The first loan was oversubscribed by a billion. The success of the three loans that followed was equally great; the fourth, coming in October, 1918, was set for six billion dollars, the largest amount that had ever been asked of any people, and after a three weeks' campaign, seven billions were subscribed. Quite as notable as the amount raised was the progressive increase in the number of subscribers, which ranged from four million individuals in the first loan to more than twenty-one millions in the fourth. Equally notable, as indicating the educative effect of the war and of the sale of these Liberty Bonds, was the successful effort to encourage thrift. War Savings societies were instituted and children saved their pennies and nickels to buy twenty-five cent "thrift stamps" which might be accumulated to secure interest-bearing savings certificates. Down to November 1, 1918, the sale of such stamps totalled $834,253,000, with a maturity value of more than a billion dollars.

The successful organizing of national resources to supply military demands obviously depended, in the last instance, upon the education of the people to a desire for service and sacrifice. The Liberty Loan campaigns, the appeals of Hoover, and the Fuel Administration, all were of importance in producing such morale. In addition the Council of National Defense, through the Committee on Public Information, spread pamphlets emphasizing the issues of the war and the objects for which we were fighting. At every theater and moving-picture show, in the factories during the noon hours, volunteer speakers told briefly of the needs of the Government and appealed for coÖperation. These were the so-called "Four Minute Men." The most noted artists gave their talent to covering the billboards with patriotic and informative posters. Blue Devils who had fought at Verdun, captured tanks, and airplanes, were paraded in order to bring home the realities of the life and death struggle in which America was engaged. The popular response was inspiring. In the face of the national enthusiasm the much-vaunted plans of the German Government for raising civil disturbance fell to the ground. Labor was sometimes disorganized by German propaganda; destruction of property or war material was accomplished by German agents; and valuable information sometimes leaked out to the enemy. But the danger was always kept in check by the Department of Justice and also by a far-reaching citizen organization, the American Protective League. Equally surprising was the lack of opposition to the war on the part of pacifists and socialists. It was rare to find the "sedition" for which some of them were punished, perhaps over-promptly, translated from words to actions.

The organization of the industrial resources of the nation was complicated by the same conditions that affected the purely military problems—decentralization and the emergency demands that resulted from the sudden decision to send a large expeditionary force to France. The various organizing boards were so many individual solutions for individual problems. At the beginning of the war the Council of National Defense represented the only attempt at a central business organization, and as time went on the importance and the influence of the Council diminished. The effects of decentralization became painfully apparent during the bitter cold of the winter months, when the fuel, transportation, and food crises combined to threaten almost complete paralysis of the economic and military mobilization.The distrust and discouragement that followed brought forth furious attacks upon the President's war policies, led not merely by Roosevelt and Republican enemies of the Administration, but by Democratic Senators. The root of the whole difficulty, they contended, lay in the fact that Wilson had no policy. They demanded practically the abdication of the presidential control of military affairs, either through the creation of a Ministry of Munitions or of a War Cabinet. In either case Congress would control the situation through its definition of the powers of the new organization and the appointment of its personnel.

President Wilson utilized the revolt to secure the complete centralization toward which he had been aiming. He fought the new proposals on the ground that they merely introduced new machinery to complicate the war organization, and he insisted that true policy demanded rather an increase in the efficiency of existing machinery. If the General Staff and the War Industries Board were given power to supervise and execute as well as to plan, the country would have the machinery at hand capable of forming a central organization, which could determine in the first place what was wanted and where, and in the second place how it could be supplied. All that was necessary was to give the President a free hand to effect any transfer of organization, funds, or functions in any of the existing departments of government, without being compelled to apply to Congress in each case.

The struggle between Wilson and his opponents was sharp, but the President carried the day. He exerted to the full his influence on Congress and utilized skillfully the argument that at this moment of crisis a swapping of horses might easily prove fatal. Opposing Congressmen drew back at the thought of shouldering the responsibility which they knew the President would throw upon them if he were defeated. On May 20, 1918, the Overman Act became law, giving to the President the blanket powers which he demanded and which he immediately used to centralize the military and industrial organization. Bureau chiefs were bitter in their disapproval; the National Guard grumbled, even as it fought its best battles in France; politicians saw their chance of influencing military affairs disappear; business men complained of the economic dictatorship thus secured by the President. But Mr. Wilson was at last in a position to effect that which seemed to him of greatest importance—the concentration of responsibility and authority.Upon the shoulders of the President, accordingly, must rest in the last instance the major portion of the blame and the credit to be distributed for the mistakes and the achievements of the military and economic organization. He took no part in the working out of details. Once the development of any committee of organization had been started, he left the control of it entirely to those who had been placed in charge. But he would have been untrue to his nature if he had not at all times been determined to keep the reins of supreme control in his own hands. His opponents insisted that the organization was formed in spite of him. It is probable that he did not himself perceive the crying need for centralization so clearly in 1917 as he did in 1918; and the protests of his political opponents doubtless brought the realization of its necessity more definitely home to him. But there is no evidence to indicate that the process of centralization was forced upon him against his will and much to show that he sought always that concentration of responsibility and power which he insisted upon in politics. The task was herculean; ironically enough it was facilitated by the revolt against his war policies which resulted in the Senate investigation and the Overman Act. His tactics were by no means above reproach, and his entire policy nearly went on the rocks in the winter of 1917 because of his inability to treat successfully with the Senate and with Republican Congressmen.

When all is said, however, the organization that was developed during the last six months of the war transported and maintained in Europe more than a million and a half American soldiers; at home it maintained two millions more, ready to sail at the earliest opportunity; and it was prepared to raise and equip an army of five and a half millions by June 30, 1920. The process had been slow and the results were not apparent for many months. Furthermore, because of the intensity of the danger and the absolute need of victory, cherished traditions were sacrificed and steps taken which were to cost much later on; for the price of these achievements was inevitable reaction and social unrest. But with all the mistakes and all the cost, the fact still remains that the most gigantic transformation of history—the transformation of an unmilitary and peace-loving nation of ninety million souls into a belligerent power—was successfully accomplished.