Demobilization : $b our industrial and military demobilization after the armistice, 1918-1920Crowell, Benedict
History
Demobilization : $b our industrial and military demobilization after the armistice, 1918-1920
Crowell, Benedict
United States. Army. American Expeditionary Forces -- Demobilization; World War, 1914-1918 -- United States
To safeguard business as much as possible and still dispose of
the surplus materials, the War Department adopted certain general
principles or policies. The first of these was that the general
Government, through its several departments and in the public work
which the departments were doing, should utilize all the surplus war
materials they could absorb. The second and more important was to
sell all general commodities to the public through the medium of the
industries which had produced these commodities and thus to avoid
disastrous breaks in market prices--even, sometimes, to sustain prices.
There was widespread disapproval of this latter policy. The public
for months had been stung and irritated by prices which many regarded
as the exactions of profiteers; and now at last, with huge stocks of
supplies on hand which had to be sold or lost, the people anticipated a
dumping which would smash down prices and bring about the discomfiture
of those who had seemingly victimized them. But this was not to be. The
Government adopted the view that it was better to have the high (but
normally declining) prices and to keep the wheels of industry turning
than to risk a collapse of prices that might bring with it general
unemployment and business stagnation.
Later on, when it had become evident that business was making a safe
passage through the reconstruction period, large stocks of clothing and
food supplies were sold directly to consumers at prices considerably
below the market averages.
Particularly in raw materials the policy of sale through, or in
coöperation with, the industry affected by the sale worked as the
Government had expected it to work. The War Department found itself
after the armistice with a surplus of 125,000,000 board feet of soft
lumber over and above what it would need in completing the various
unterminated construction projects. This was lumber enough to build
5,000 houses. To have dumped this on the market would have paralyzed a
large part of the lumbering industry until the market had absorbed the
army lumber. Accordingly the War Department entered into a contract
with the authorized representatives of the lumber industry whereby it
was agreed that the lumber should be marketed gradually and at prices
fixed by agreement between the Government and the industry. Under
this arrangement the surplus was all sold without disturbance to the
industry and at prices which brought a good return to the Government.
Public-domain text, read in full here on John Shaqi.
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