Business: Giant into Armor

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The atmosphere changed in other ways. To clear the tracks for war production, the Administration at last called in International Telephone & Telegraph's white-maned President William H. Harrison, an old WPB director, to run the new National Production Authority. Harrison cut back civilian use of some scarce materials (mostly metals) and set up steel allocations. But these were largely paper orders, because the Defense Department failed to put out any war orders in quantity. The Pentagon's hesitation stemmed, in part, from a dislike of mass-producing tanks or planes which might soon grow obsolete, in part from a fear that too sudden a buildup might "strain" the economy. It was one of the strangest paradoxes of Washington's confusion that the Pentagon's generals worried about the civilian economy while some civilian administrators worried about the dearth of tanks and planes.

Nobody was more confused than businessmen who, when they went to Washington to try to find out what war goods they could make, got only a gabble of doubletalk and "wait-till-you-hear-from-us." North American Aviation's Chairman J. H. ("Dutch") Kindelberger told of meeting a fellow executive wearing a button inscribed with the letters B.A.I.K. Explained the wearer: "It means, 'Brother, Am I Konfused.'" To the inevitable observation that "confused" is spelled with a "c," the wearer replied: "That shows how confused I am."

The confusion was compounded when Alan Valentine, ex-president of the University of Rochester, took on the price & wage control job which nobody else wanted. Valentine soon found out why. His first fumbling effort at a rollback was on automobile prices. This set off a whole rash of price & wage rises in other industries alarmed by the prospect of a general "freeze." Despite the World War II experience which saw much of the U.S. meat supply diverted from normal distribution channels, Valentine talked blithely of new controls on meat. Sighed Harvard's wise, white-thatched Economist Sumner Slich-ter: "Whatever else the U.S. may be short of, it does not lack for thousands of experienced black marketeers."

Amid all this stumbling and groping by a dozen warring Government bureaus, rearmament virtually came to a stop. Only the onslaught of the Chinese Communists pushed it forward again. President Truman then did what he should have done months before. He called in a top production man. Charles Edward Wilson, president of General Electric Co. (another antitrust defendant), went to Washington to get war production moving. As chief of the newly created Office of Defense Mobilization, Wilson demanded and got more power over wages, prices and production than anyone except the President had ever held, even in World War II. Wilson needed them. It was his job to organize the free-enterprising American economy for the defense of the free world.

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