Freedom's Forge: How American Business Produced Victory in World War II

by Herman, Arthur

  “I’m rather shocked at the depth we are getting into,” Stimson said. Knox stared at the blackboard and then said what everyone else was thinking. “We are going to pay for the war from now on, aren’t we?”

  Morgenthau threw up his hands. He said, “Well, what are we going to do, are we going to let them place more orders, or not?” Frank Knox murmured, “Got to. No choice about it.” But then someone asked, could American industry meet these incredible numbers—and those for the United States’ own military, as well?47

  Bill Knudsen looked up. “We can make it,” he said in his hoarse half whisper, “if it can be financed”—that is, by the United States instead of Great Britain. Jesse Jones proposed they bring the whole problem to Congress, and Stimson strongly agreed. No one wanted Britain to starve—but no one dared to suggest loaning Britain the money it needed. They had tried that in the First World War, and it had been a disaster. Something more systematic was needed, something that would allow American factories to fill British orders without the British paying dollars for it. And so the idea of Lend-Lease was born.48

  The concept was simple. Its contours had been implicit in the fifty-destroyer deal struck back in September. But its underlying rationale was spelled out in the contract Knudsen and Jesse Jones had hammered out for the Continental Motors deal, which stated that making arms for Britain was important to America’s national defense.

  Starting in December, the federal government would place all orders for munitions made in the United States. If the Army and Navy needed them, the United States would keep them. If Washington decided that the defense of the country was better served lending them to Great Britain, then “we could either lease or sell the materials, subject to mortgage, to the people on the other side,” as Roosevelt explained in a press conference on the seventeenth. Roosevelt compared the transaction to lending a garden hose to a neighbor whose house was on fire. It’s still our hose, he explained. We are just letting the one who needs it most use it first.

  Who would have legal title to the goods once they were delivered? a reporter asked. “I don’t know, and I don’t care,” the president said.49

  Washington’s new determination was reflected in two other events.

  On December 1, Joe Kennedy left as ambassador to Britain. Defeatist, anti-Semite, the prophet of doom and gloom, Kennedy was replaced by John Winant, businessman, liberal Republican, former governor of New Hampshire, and firm backer of aid to Britain. For the British it was like lifting the window to let in the fresh air. Winant’s arrival at Windsor Castle, where King George VI personally greeted him at the train station, signaled that the United States was in this war to stay.50

  The other was the creation of the Office of Production Management to replace the NDAC. Advice and encouragement would no longer do the job. A new body was needed that could make decisions and issue directives, with a single head in charge of mobilizing American industry for the war effort. Stimson, Knox, and Henry Morgenthau all agreed on who that person should be: Bill Knudsen.

  When they met at the White House on December 20, so did the president. Roosevelt, however, added one stipulation. There should be two heads, not one, he said: one to lead American business, the other to lead labor—which also happened to be a major part of his political base. Roosevelt named Sidney Hillman of the Amalgamated Garment Workers, and now on the NDAC. Despite a feeling of foreboding, Stimson and Knox bowed to the president’s wish.51

  The next day, the secretaries broke the news to Knudsen in Stimson’s office. “I told Knudsen that he was to be the chief figure,” Stimson wrote afterward in his diary, and that he “had won his position during the last six months by his outstanding work here in the Advisory Council [sic].” He and Knox affirmed that they would stand behind him and could be called upon whenever he needed them. He thanked them and returned to his office across the street.52

  He was a little stunned—and not a little bemused by the idea of sharing leadership with a man with whom he had continually crossed swords over labor shortages and strikes. Hillman, born in Lithuania, was an immigrant like himself. Rumpled and relaxed, he was, like Knudsen, deceptively self-deprecating. “Sorry, my best suit has to go to the cleaners,” he would say apologetically to the other committee members, pointing to soup stains on his lapels, “but I wore it anyway.” Otherwise they had little in common. But at least Knudsen could bring his own team, along with Stettinius and Don Nelson, with him—plus a new man, Chicago newspaper publisher Merrill Meigs, to head aircraft production. He was also relieved, because at long last preparation for war would have the force of law behind it.

  “When I think of the seriousness of the whole world situation,” he had told the assembled guests at the NAM banquet the week before, “where the Americas are the only spot where freedom and law still have a foothold … I think that the best and only thing the United States can do and must do is prepare swiftly and well to protect ourselves.” It was time to put the defense buildup on a wartime basis, even though America was still at peace.

  “It is our responsibility to see that this is done in record time,” he said, looking over the representatives of the carmakers, the machine tool makers, the steel and rubber and copper and chemical industries, “and now show the world that we can do the things we have been so wishfully forecasting the last six months.”53

  Four days after Christmas, on the night of December 29, 1940, a resonant voice familiar to all Americans came onto radios across the country.

  “My friends, this is not a fireside chat on war. It is a talk on national security.”

  Like millions of other Americans, Bill Knudsen sat in the living room of his Rock Creek house and listened to his president.

  “Not since Jamestown and Plymouth Rock,” Roosevelt said, “has our American civilization been in such danger as now.” The Nazi empire was bent on creating a new global order based on racial superiority and domination, one with “no liberty, no religion, no hope.” Under such an order, America would survive, if it survived at all, at the point of a gun.

  But by aiding those “in the front line of democracy’s battle” and halting the Axis advance, Roosevelt told the American people, “there is far less chance of the United States getting into the war…. The people of Europe who are defending themselves do not ask us to do the fighting. They ask us for the implements of war, the planes, the tanks, the guns, the freighters which will enable them to fight for their liberty and for our security.”

  The means to do it are already here, the president said. “American industrial genius, unmatched throughout the world in the solution of production problems, has been called upon to bring its resources and its talents into action.” The makers of sewing machines and cash registers and lawn mowers, he said, are now making fuses and telescope mounts and shells and tanks.

  “We must be the great arsenal of democracy. For us this is an emergency as serious as war itself.”54

  Knudsen must have smiled. The phrase “arsenal of democracy” was his.55 It was already happening. Some 50,000 planes, 130,000 engines, 380 Navy ships, 9,200 tanks, and 17,000 heavy guns, plus rifles, helmets, and clothing for an army of 1.4 million men, were being made or under contract to be made. Plant facilities to arm another 2 million, and get a two-ocean navy of 800 ships out to sea, were on their way, as well. Knudsen had calculated all this would require some 18 billion man-hours of mind-bending, back-straining labor—and he sensed that was still a long way from being enough.56

  “I call upon our people with absolute confidence,” the president said in closing, “that our common cause will greatly succeed.”

  It was three nights before the New Year. Eight days earlier the papers had carried the news that a bankrupt and burned-out F. Scott Fitzgerald, the novelist who had symbolized the Jazz Age and its excesses, had died of a heart attack.

  The party really was over. America was about to find a new generation of heroes.

  One of them would be Henry Kaiser.

  * * *r />
  * He had already done that with cement, building the world’s biggest cement plant in the late thirties at Alta Vista, and winning the plaudits of Ickes and the New Dealers for getting around the big cement producers.

  † Including the B-29. See Chapter 18.

  ‡ According to daughter Martha, Bill’s wife, Clara, was even better, regularly walking away with the winnings at poker sessions at the Balmoral house.

  Richmond shipyards, October 1941. Courtesy of the Bancroft Library, University of California, Berkeley

  Together we build.

  —Henry Kaiser

  THE EXPERTS PREDICTED it would take Bedford, McCoon, and their teams six months to build up enough solid ground before they could begin work on the shipyard. It took Kaiser’s men exactly three weeks.1 Truck after truck brought up 300,000 cubic yards of rock and gravel around the clock. In more or less continuous rain, gangs of workmen sank 24,000 iron piles for the shipways and piers, even before Kaiser’s architect Morris Wortman had completed the final blueprints. “There was a race,” Clay Bedford later remembered, “between the Kaiser draftsmen and the field people as to whether we could build it first or the engineers and architects could draw it first.”

  Three hundred and thirty-seven thousand cubic yards of silt had to be dredged out of the Santa Fe Canal, and another 300,000 from what was to become the launch basin and canal where completed ships would get their final outfitting. On February 22 the first makeshift office was finished, and Clay Bedford moved in with his team from Corpus Christi: secretary Howard Welch and cost accountant Joe Friedman. And still it rained. The fiberboard ceiling in the building became so waterlogged that it sagged. Bedford had to duck his head every time he went into his office.2

  Even in fair weather, the construction equipment of the time did not make the job easier. In 1941 there were no hydraulic rigs, only cable scrapers, bulldozers, and cranes on trawlers or trucks. The biggest bulldozers for clearing earth had only 132 horsepower, with the operator constantly hopping off his machine to check the grade against the marked slope numbers. Concrete had to be poured from a crane-hoisted bucket, while water and gas mains required installing time-consuming cast iron or welded steel pipe—at a time when steel was becoming a rare commodity.3

  Still, the deadline would not wait. “That first keel has to be laid by March 7,” Kaiser had told Bedford and, to make his life more complicated, all the work was to be done using union labor. Laborers from sixteen different craft unions applied for work; even union barbers from around the country turned up, expecting that the new yards were going to mean lots of paying customers.4

  When finished, the yard had seven shipways, each 87½ feet wide and 425 feet long. North of the shipways was a massive steel-framed building housing the plate shop and assembly bay, as well as a large open area where preassembled parts could be moved and stored until hoisted into place. To do the hoisting, each shipway was serviced by cranes that moved along steel tracks set on either side of each slipway, so that the crane could swing from one slipway back to another. Gantry cranes of that size were in short supply in Depression-era America, so Bedford arranged for cranes he had used building Grand Coulee Dam to be dismantled and shipped west.5 Until now the model for American shipbuilding had been the steel industry. Kaiser and his team would introduce a new model: big-time construction. In so doing, they would revolutionize shipbuilding not just in America but around the world.

  All the same, an operation of this size required an experienced superintendent. It was a typical early morning Kaiser phone call that got Edwin W. Hannay, a famed West Coast shipyard manager and troubleshooter for several shipmakers during the First World War, out of bed and out of retirement. Henry’s son Edgar was on the line. “Can you come back to work for us?” he asked. Hannay agreed and made some calls of his own. He pulled together sixteen friends and former colleagues, who then brought in their friends. In no time a skeleton force was ready to get to work.6 This was fleshed out with the men who had worked with Kaiser before on every project from Boulder Dam and Grand Coulee to the Oakland–San Francisco Bridge, and who were used to doing the impossible for the boss.

  They knew a lot about construction and cement but, as Hannay found out, not a lot about iron or shipbuilding. When Hannay got started on Hull No. 1, he heard someone ask impatiently, “When do we pour the keel?”7

  Edgar, meanwhile, was on his way up to Portland.

  In 1940 Oregon was still the Northwest his father had known and left behind: a world of towering forests, lumber camps, and sawmills, surrounded by thousands of acres of fruit orchards. Oregon was settled, it was said, by Missourians who didn’t want to work, and the slow, easy ways of the past still suited the pioneers’ grandsons and granddaughters who made up the bulk of the state’s population.8

  When Edgar arrived, he managed with his father’s help to pick out eighty acres of barren land outside Portland that were to be the site of the Todd–Six Companies shipyards, otherwise to be known as the Oregon Shipbuilding Corporation. City fathers were unperturbed by the Kaiser hustle and bustle. Shipbuilding activities during the last war had made the town.9 They also had known Henry Kaiser the road builder for some twenty-five years. They figured (wrongly, as it turned out) that this would be nothing too big or complicated, and that they could keep a handle on the new development.

  Edgar had begun work for his father at age twelve, writing out dispatch tickets for truckers supplying equipment for road construction sites. One day a trucker drove off after forgetting his ticket, and Edgar chased after him. The boy slipped, fell under the rumbling vehicle, and had his foot crushed. Ord Ordway and another worker gathered him up and drove him to a hospital. Doctors wanted to amputate, but Ordway warned them they had better wait for the boss to show up. Henry Kaiser arrived, looked at his son’s foot, and ordered the doctors to do what they could to save it. They did as they were told, and although Edgar Kaiser walked the rest of his life with a limp, he did it on two feet.10

  Henry’s relationship with Edgar was typical of all his dealings with subordinates, sons or not. “You find your key men by piling work on them,” he used to say. “They say, ‘I can’t do any more,’ and you say, ‘Sure you can.’ So you pile it on and they’re doing more and more. Pretty soon you have men you can rely on absolutely.”11 Far from driving a wedge between father and son, Kaiser’s demands made them an inseparable team. Henry was devoted to his other son, but Henry Jr. suffered from bad health and would eventually die of multiple sclerosis in 1961. The bond between Henry and his namesake would never be as close, or as vital to the making of the Kaiser corporate empire, as the one between Henry and the bespectacled, hard-driving Edgar.

  Edgar had made his bones, as it were, supervising the construction at Grand Coulee—although he had been only thirty-four—and then the Bonneville Dam. Now getting started at Portland, he had learned all he could about shipbuilding from repeated visits to various Todd yards: about the laying of the keel, the fitting of steel plates and support ribbing for decks and holds, and then the installing of engines. He could envision it all in his mind, including finally the electrical and ventilation assemblies, before the main deck was completed and the ship was ready to slide down the slip.12

  And he knew this particular ship design and the demands it would make on his engineers, foremen, and workers. It required steel plates, each weighing several tons, to be molded and cut into 435 different shapes and an even more bewildering variety of sizes. His Portland operation would be ordering 7,500 components from 600 different suppliers, from condensers and switches to wires, pumps, and the engines themselves.13

  Even more daunting was the fact that he would have to do all this with men who had never built a ship in their lives, workers from construction jobs, sawmills, and lumber camps, under the supervision of foremen and quartermen who barely knew more.

  But like Clay Bedford, Edgar had his own team of trusted engineers and site managers, men he had driven and hounded like his father had h
ounded him—and who knew how to make anything in a hurry. There was also another goad to action: the desire to beat his rival, the man who was almost Kaiser’s other son, Clay Bedford. Over the next thirty-six months, Henry would encourage a less-than-covert competition between the two yards, and the two men in charge. It was another typical Kaiser strategy, and it worked. It never turned ugly, and never became divisive. But Edgar Kaiser and Clay Bedford would work eighteen-hour days for the next three years, each trying to see who could build ships faster and better.

  Bedford had a month’s head start. In typical Kaiser style, Edgar got to work even before the blueprints were finished. It took him less than two months to get the first set of shipways built.14 At the end of March, his first buildings and cranes appeared on the Portland horizon, as nine hundred miles away in Richmond, Bedford and Hannay were ready to lay the first keel of the vessels both he and Edgar would be building: the Liberty ships.

  Initially the maritime commissioner had rejected Knudsen’s idea of making Kaiser’s ships the standard for a new generation of American merchant freighters. But as the events of December 1940 grew darker, Land changed his mind. He made secret plans to take over the Kaiser ship contract in case Britain fell—and the growing need to get ships down the slips faster pushed his earlier reservations away. If they didn’t take this opportunity, he told Bill Knudsen, it wouldn’t just be Britain, but America that wouldn’t see a completed ship before 1942.15

  Knudsen signed on. It would mean that a whole new series of shipyards would have to be acquired or built, in addition to the one Kaiser was building at Richmond and the one Todd and the Six Companies were using in Portland, Maine—and Edgar Kaiser’s yards in Oregon. Baltimore’s Sparrow Point, New Orleans, Houston, Jacksonsville, Florida, and Mobile, Alabama, were among the places they found.16 But getting the right sites for shipyards was just one problem. The other was what kind of ship. Land went to New York City to see the man who knew the answer, visiting him at his office on 21 West Twenty-first Street. His name was William Francis Gibbs and the building was the headquarters of Gibbs and Cox, the biggest naval architecture firm in America.