The role of free enterprise in winning WWII

Was American mobilization for World War II a triumph of big-government planning? Arthur Herman‘s new book Freedom’s Forge answers that question, as Steve Forbes explains in the latest issue of Forbes.

This fantastic book does two big things. First, it tells the largely unknown story of America’s extra­ordinary output of war materials during World War II—output that almost defies imagination. By war’s end the U.S. had manufactured about 70% of all Allied war material, with U.S. factories outproducing everyone else combined. Ford Motor Co. produced more than Benito Mussolini’s entire Italian economy.

Amazingly, historians gloss over America’s accomplishment, assuming that because we were the world’s biggest industrial country that it was no surprise we could turn out so many planes, ships, tanks, rifles, ammunition, uniforms, etc. However, this miracle didn’t just happen; it was the result of the extraordinary leadership of a handful of American businessmen. Freedom’s Forge focuses on two of the most important, William Knudsen and Henry Kaiser. World War II’s industrial mobilization was in stark contrast to our World War I experience, which was largely a flop.

The second thing this book does is emphasize that it was the practice of free enterprise that was behind these production miracles. Countless companies “carried the spirit of free enterprise like a revitalizing force, with the power to meet the needs of total war without losing their identity or creativity or power of self-renewal. … Human ingenuity could solve problems that government planning or rationing could not.”

Mitch Kokai / Senior Political Analyst

Mitch Kokai is senior political analyst for the John Locke Foundation. He joined JLF in December 2005 as director of communications. That followed more than four years as chie...

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    “Human ingenuity could solve problems that government planning or rationing could not.”

    Free enterprise worked in this case because Roosevelt had the foresight to create a committee made up of different parts of the business world including reps from corporations, labor and consumer groups to lead the transformation of the factories. Roosevelt knew that left to its own accord, business would try to run rough shod over labor and consumers. A fight between unions and business would not help win the war. Therefore, bring them all to the table and let them all have a say. Industries that didn’t have to deal with too many labor issues could concentrate on output.

    Roosevelt also pushed business to allow black people and women into the workforce, knowing that if the prejudices by some industries persisted, they would not be able to meet the demands of the allied forces.

    Knudsen deserves a lot of credit for leading industry into massive war production, but he was hand picked by Roosevelt for the job. Government’s role in getting business prepped for production should not be discounted.

    Also, it was Roosevelt who took the political risk to push for rationing in the US so industry could have the materials it needed.