McNair Paper Number 50, Chapter 8, August 1996

In early 1943 the president was being pushed to establish a war mobilization office by Senator Harry Truman and his committee. Truman's committee and other congressional investigative committees were dismayed by the lack of unity in the industrial effort and demanded a single civilian-directed procurement agency for all Army, Navy, Maritime Commission, and Lend-Lease needs. Truman knew that Nelson had much more authority than he exercised and therefore called for a War Mobilization Board, stating that he would create one by legislation if Roosevelt did not take the initiative. (Note 1)Other efforts also fostered the establishment of the Office of War Mobilization. (Note 2)

For its part, the Senate Military Affairs Committee recognized the weaknesses in the War Production Board. There were too many agencies with a say in too many parts of the economy for efficiency. The press was also vocal in its criticism. Roosevelt either sensed the pressure or understood the necessity, or both, and created by executive order the new office, designating a handful of government officials as advisers (Nelson was one of the five), and chartered the Office of War Mobilization to "develop unified programs and to establish policies for the maximum use of the Nation's natural and industrial resources for military and civilian needs, for the effective use of the national manpower not in the armed forces, for the maintenance and stabilization of the civilian economy, and for the adjustment of such economy to war needs and conditions."

The key to the Executive Order was in this sentence: "To unify the activities of the Federal agencies and departments engaged in or concerned with production, procurement, distribution or transportation of military or civilian supplies, materials, and products and to resolve and determine controversies between such agencies or departments." The new office could issue "directives and policies" to carry out its charter, and "it shall be the duty of all such agencies and departments to execute these directives, and to make to the Office of War Mobilization such progress reports as may be required." (Note 3)James F. Byrnes drafted the Executive Order and wrote the language to make the new agency effective. From the start he was called Assistant President, and I know of no others with that title. The only things missing in James Byrnes portfolio were foreign affairs and military grand strategy. (Note 4)

Before May 1943 and his appointment to the new office, Byrnes had become completely immersed in economic planning and manipulation and thereby enormously powerful. As Director of the Office of Economic Stabilization he was intimately concerned with all major segments of the economy because his office was charged with eliminating inflation. No similar office had been established during World War I, and as a result, consumer prices rose and the national debt ballooned. The Office of Economic Stabilization was not able to eliminate inflation, but it did dampen it, and in the process Byrnes learned a great deal about the economy and how segments of it-agriculture, industry, etc.-worked to profit or benefit their narrow interests rather than the general welfare. (Note 5)Byrnes' powers were extensive. The Executive Order establishing the Office of Economic Stabilization permitted him: to formulate and develop a comprehensive national economic policy relating to the control of civilian purchasing power, prices, rents, wages, salaries, profits, rationing subsidies, and all related matters-all for the purpose of preventing avoidable increases in the cost of living, cooperating in minimizing the unnecessary migration from one business, industry or region to another, and facilitating the prosecution of the war. To give effect to this comprehensive national economic policy the Director shall have power to issue directives on policy to the Federal departments and agencies concerned. (Note 6)

Interestingly, the Office of Economic Stabilization did not disappear with the creation of the Office of War Mobilization. Fred M. Vinson, a former congressman and appeals judge (and later Chief Justice) replaced Byrnes, and his office was subordinate to Byrnes's new one. (Vinson eventually became Director of the Office of War Mobilization and Reconversion, its new title after October 1944.) The arrangement worked well because the men knew each other and had worked together in the past. Further, Vinson clearly understood Byrnes's relationship with the president. (Note 7)

Soon after taking office, Byrnes wrote to the chiefs of all the procuring agencies and pointed out his duties as prescribed by the president. He put everybody on notice that he intended to scrutinize all procurement. He called for establishing, within and at the top of each agency, a procurement review board that would include a representative of the Office of War Mobilization. Some offices, notably Lend-Lease and the Maritime Commission did so immediately, but the Army had to be told a second time and the Navy only did what it was told when the president insisted they follow orders. The Navy dragged its feet for months trying to subvert Byrnes's authority. Byrnes wrote the president that General George C. Marshall was cooperating and that billions of dollars were saved through this cooperation, but that the Navy was recalcitrant. The Navy, counting on its special relationship with Roosevelt, tried to go around Byrnes, but the president forwarded their memoranda to Byrnes for answering. (Note 8)

The Office of War Mobilization was certainly in a position to rationalize industrial mobilization, but what should be its role vis-a-vis the Joint Chiefs of Staff? Byrnes was indeed more powerful than any civilian cabinet member, for he had jurisdiction over all agencies, bureaus and departments, (Note 9)but the Joint Chiefs were in another realm. Some in Byrnes's office thought that he should sit with the Joint Chiefs of Staff so that grand strategy and procurement would be harmonized. But the services, especially the Navy, resisted civilian participation in military affairs, especially war planning. Byrnes established within the Joint Chiefs of Staff a Joint Production Survey Committee, with representation from the Office of War Mobilization, a compromise between full integration of procurement and military strategy; previously, Nelson's War Production Board was not represented on Joint Chiefs of Staff committees. Byrnes still did not consider his relationship with the Joint Chiefs to be satisfactory. The Chiefs still wanted a great deal of the say regarding industrial mobilization, but Byrnes was able to establish his authority over the Joint Chiefs on matters of supply, although doing so was not easy. (Note 10)

He informed the Chiefs at the outset that he and the Office of War Mobilization were responsible for the balance that must be maintained between civilian and military production, and therefore he had to know what was being procured by the services. Moreover, he had to know that the amounts being procured were not excessive. For example, he set up a procurement review board for the Army, which found it needed some testimony concerning military matters. The Army refused to show any such data to civilians, and Byrnes told the Chief of Staff that he would take the Army's refusal to the president. The Army gave in. (Note 11)

Prior to the creation of the Office of War Mobilization there was no synchronizing of grand strategy and production. Although the new Office was an imperfect mechanism for effecting this synchronization, it did have the president behind it, plus Byrnes's extensive experience, keen intelligence, and high common sense. The problem was the active competition for limited resources that kept agencies in permanent conflict. Byrnes's approach was to exercise control by listening to arguments from disputing agencies after conflicts had developed and making the necessary decisions. This is, more or less, the role the industrial mobilization plans had reserved for the War Resources Administrator, except that the planners hoped that this bureaucrat would resolve conflicts before they occurred. Byrnes did not need a big staff to do that job; in fact, he kept his staff tiny (ten initially, 16 in November 1944, 80 in June 1945, and 146 in May 1946 during the height of reconversion, compared with 20,000 in the War Production Board). (Note 12)He used the staffs of the various agencies to provide him with the information he needed. Byrnes deliberately safeguarded the autonomy of the agencies he dealt with, acting as a disinterested decisionmaker-in effect a judge. (Note 13)Moving the decisionmaking power to the Office of War Mobilization diminished Nelson's authority and prestige and also that of the War Production Board. There was only one authority higher than Byrnes, and the president was adamant that Byrnes' decisions would stick. Even the War Department tended to accept Byrnes' decisions as final. (Note 14)Roosevelt loved it, even telling a friend that "since appointing Jimmy Byrnes to [the Office of War Mobilization] he, for the first time since the war began, had the leisure 'to sit down and think.'" (Note 15)

Byrnes took on the dispute with the Joint Chiefs that had caused Nelson to be fired: reconversion. As a politician who was painfully aware of the costs to his party for failing to implement an ordered demobilization after World War I, he was sensitive to the demand. His aim (and that of civilians in the war agencies) was to prevent unemployment and severe industrial dislocation with the ending of war production. Almost all agreed on the objective, but timing was everything. For at least 18 months before the end of the war in Europe, a large proportion of Byrnes' time and that of people in numerous agencies like the War Production Board was devoted to the problem of reconverting industry. Two actions were involved: early planning for the changeover that would occur after victory and a gradual resumption of peacetime enterprise while the war was still going on. (Note 16)

Some aspects of demobilization planning came easily, like agreement on how to clear away government property and how to settle cancelled contracts. "The sharp policy questions . . . were over how much, if any, resumption of normal civilian activity" could be undertaken with the war going on. "The heat engendered caused a greater wave of name-calling in Washington than any other conflict." Nelson and his supporters were accused of being willing to prolong the war to give certain business interests an early advantage. Big business lined up on both sides of the issue, as did government agencies and even people on the War Production Board; where people stood on the issue depended very much on where they sat. For example, the War Manpower Commission sided with the military because manpower was so tight-it was the major bottleneck by the time this issue became prominent. The Commission wanted no freedom for workers to opt for civilian products employment while there were still landing craft and other tools of war to be built. The Office of War Mobilization and Reconversion was "indispensable" in adjudicating this issue because it was superior to all the competing agencies and departments, and when it made reconversion decisions it was "never seriously challenged." In August 1944, it sanctioned limited reconversion. It slowed reconversion dramatically in December 1944 during the Battle of the Bulge, but it reopened the gates in March 1945. "From early 1944 to the end no agency made any policy decisions in the reconversion field without clearing with [the Office of War Mobilization and Reconversion]." (Note 17)Make no mistake, however-reconversion was not a factor until munitions production actually peaked. The unremitting drive was for output, and the system produced arms prodigiously.