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 Hollinger Corp. 
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 1918a 
 Copy 1 
 
 Washington's 
 Nine Months at War 
 
 Great Efforts — 
 Disappointing Results — 
 
 JVhyf 
 
 RAYMOND B. PRICE 
 
 Second Edition 
 
 t 
 
 Published by 
 
 PATRIOTIC EDUCATION SOCIETY, Inc. 
 
 806 Seventeenth Street, N. W. 
 Washington, D. C. 
 
INTRODUCTORY NOTE 
 
 Despite all the specific and general criti- 
 cisms that follow herein it is a duty and a 
 pleasure to pay tribute to the high moral 
 purposes and standards behind our Executive 
 acts. Seldom in American history has im- 
 proper personal and political influence 
 counted for so little, or has conscientious 
 endeavor aimed higher and striven harder. 
 The failures in great part are due to poor 
 organization — which furnishes the excuse for 
 this pamphlet. 
 
 RAYMOND B. PRICE 
 Washington, December 31,. 1917. 
 
 
^> \ Q?f>- CONTENTS 
 
 Introductory Note 
 
 I. FOR OUR VERY SAFETY, 3 
 
 German Opinion of Democracy's Leaders 
 Initiative of American Business Men 
 Invisible Censorship 
 
 II. COORDINATION— THE MISSING LINK, 5 
 
 Shipping the Greatest Need 
 No Centralized Statistics 
 Vital Matters Forgotten 
 
 III. LABOR THE UNSOLVED PROBLEM, 7 
 
 Competition for Labor 
 Makeshift Labor Control 
 Labor Profiteering 
 Washington's Lack of Remedy- 
 Belated Exemption of Skilled Labor 
 Public Opinion Must Decide 
 
 IV. BRITISH LABOR EXPERIENCE, 16 
 
 Strikes Comparatively Few — Why 
 
 Employer and Worker Yield Privileges — Accept Restrictions 
 
 War Munitions Volunteers 
 
 Women Workers 
 
 Controlled Plants 
 
 Training Methods 
 
 V. BRITAIN FIRM— AMERICA HESITATING, 27 
 America's Labor Plans Undeveloped 
 Inadequate Appropriations 
 Britain's After-the-War Activities 
 United States Shipping Board Plans 
 Critical Delays 
 Suggestions for National Labor Policy 
 
 VI. CAPITAL AND LABOR HAVE LOCKED HORNS, 37 
 Labor Dictator Needed 
 
 Statements by Government, Employers, Organized Labor 
 The Deadlock 
 
 VII. THE ALIEN PROBLEM, 48 
 
 Private Citizens to the Rescue 
 Government Evasion 
 Ramifications of the Problem 
 The Alien's Point of View 
 
 VIII. INTELLIGENCE SERVICE, 50 
 To Punish But Not to Prevent 
 
 Thousands of Lives, Billions of Property Lost and Jeopardized 
 International Advertising 
 
 IX. CONTRACTS, 53 
 
 General Principles 
 
 Avoidable Profiteering 
 
 The Public Pays 
 
 Business Principles Challenged 
 
CONTENTS— Continued 
 
 X. TRANSPORTATION, 55 
 
 Organization by Installment 
 Neglected Waterway and Highway 
 Railroads Behind in Engineering 
 Mr. McAdoo's Opportunity 
 Dangers from Railroad Congestion 
 The Railroad's Bias 
 
 XL FUEL, 64 
 
 Penalty for Inadequate Information 
 Conservation Neglected 
 
 Information, Skill, Men — Awaiting Leadership 
 Comprehensive Foresight Needed 
 
 XII. IMPERFECT DEMOCRACY vs. PERFECT 
 AUTOCRACY, 66 
 
 A Nation of Experts 
 
 Germany's Spoiled Children 
 
 Price Fixing, Priority, Non-Essential Business 
 
 Matured Plans Lacking 
 
 Government's Responsibility 
 
 Experience of Others 
 
 Using Trade Organizations 
 
 XIII. THE COUNCIL OF NATIONAL DEFENSE, 83 
 
 Capacity for Development 
 Too Busy to Organize 
 Help Not Wanted 
 Heroic Efforts 
 
 XIV. CONGRESS, APPLY THE LESSONS, 86 
 
 Frank Public Opinion Needed 
 
 Correct Organization Imperative 
 
 Executives Should Welcome Sympathetic Suggestion 
 
 Examples of Obstructions 
 
 XV. IMPORTANCE OF PERSONNEL, 92 
 
 Constructive and Operating Minds 
 Systematically Seek Best Men for High Posts 
 
 XVI. THE NEXT SIX MONTHS, 94 
 Facing Our Fate 
 "Time Is Everything" 
 Our Utmost None too Much 
 "Why Alarm the Public?"' 
 
 XVII. THE GENERAL STAFF, 98 
 Ours and Others 
 Unity of Command 
 
 XVIII. NO MORE HALF-MEASURES, 114 
 
 Who Dare Oppose America's Safety? 
 
 The Two Great Weaknesses 
 
 What is Needed? 
 
 What Must Be Eliminated 
 Authority, 119 
 The Executive Department Chart of Organization, Back Cover 
 
For Our Very Safety 
 
 "Those who at present hold power in 
 the great democracies have risked in 
 irresponsible fashion the future of the 
 peoples entrusted to their leadership." 
 — General von Freytag. 
 
 The London Times of Nov. 7th, 1917, 
 reviews "Deductions from the World 
 War," recently published in Germany 
 by Lieutenant-General Baron von 
 Freytag Loringhoven, who was Quar- 
 termaster-General in the field when 
 Falkenhayn was Chief of the Gen- 
 eral Staff and who is now stationed in 
 Berlin as Deputy Chief of the General 
 Staff. The author is described as a 
 "moderate" among Prussian militar- 
 ists, a master of military history, a 
 writer of great clearness and fai 
 from being a typical Pan-Germanist 
 or even a Bernhardi. 
 
 General von Freytag argues that 
 before the war Germany's armaments 
 were inadequate and that in the fu- 
 ture, recognizing that "facts are 
 facts," still larger expenditures must 
 in spite of all difficulties be made. He 
 proposes giving at least partial mili- 
 tary training to those who in the past 
 had been rejected but who in this war 
 have been found fit for service. "Only 
 so can we arrive at a real peoples' 
 army, in which every one has gone 
 through the school of the standing 
 army. It may be asked what is the 
 use of all this. Will not the general 
 exhaustion of Europe after the world 
 conflagration of a certainty put the 
 danger of a new war, to begin with, 
 in the background, and does not this 
 terrible murder of peoples point in- 
 evitably to the necessity of disarma- 
 ment to pave the way to permanent 
 peace? The reply to this is that no- 
 
 body can undertake to guarantee a 
 long period of peace, and that a last- 
 ing peace is guaranteed only by strong 
 armaments. Moreover, world power 
 is inconceivable without striving for 
 expression of power in the world, and 
 consequently for sea power. But that 
 involves the constant existence of a 
 large number of points of friction. 
 Hence arises the necessity for ade- 
 quate armaments on land and sea. 
 
 "The world war affords incontro- 
 vertible proof that Germany must for 
 all time maintain her claim to sea 
 power. 
 
 "The fact that precisely the Presi- 
 dent of the United States of North 
 America has advocated the brother- 
 hood of the peoples surely ought to 
 frighten us. America's behavior in 
 the war has shown that pacificism, as 
 represented in America, is only busi- 
 ness pacifism, and so at bottom noth- 
 ing else than crass materialism. This 
 truth is not altered by the fact that it 
 is wrapped in a hazy garment of ideal- 
 ism and so seeks to hide its real mean- 
 ing from the innocent. Nor is the 
 truth altered by the appeal to demo- 
 cratic tendencies, for precisely this 
 war is showing that those who at 
 present hold power in the great de- 
 mocracies have risked in irresponsible 
 fashion the future of the peoples en- 
 trusted to their leadership." 
 
 The criticisms against incompetence 
 or irresponsibility, often apparently 
 justified by the facts, in each of the 
 
 [3: 
 
allied countries would seem to make 
 certain that all Germany agrees with 
 the last sentence quoted. And if the 
 German nation feel thus about democ- 
 racy and its leaders our hopes of a 
 peacefully democratic future for Ger- 
 many seem dim. Therefore, facing a 
 condition and not a theory, is it not 
 our foremost duty to analyze bravely 
 our own weaknesses and make unre- 
 lenting effort to correct them? 
 
 In Washington a certain business 
 man who has risen to national promi- 
 nence by sheer ability and industry 
 has for months been trying untiringly 
 to point out weaknesses which he per- 
 ceived in our war organization. Suc- 
 cessful as an organizer he has still 
 failed with the combined help of large 
 organizations to carry his conclusions 
 to action on the part of our Govern- 
 mental leaders. Deploring the pre- 
 sent critical stage of the war and our 
 relation to it, he said in a recent con- 
 versation, "If the business men, or 
 only a part of them, who are here in 
 Washington would say frankly what 
 they know and feel the nation would 
 be shocked but the remedy would 
 quickly arrive." And then after out- 
 lining one remedy he ended, "But 
 don't quote me by name because I am 
 in an official position." 
 
 Dangerous Censorship 
 
 There is an invisible censorship, 
 more dangerous than one enacted into 
 written law, that muzzles brave men. 
 Fostered at times by mistaken ideas 
 of patriotism, encouraged perhaps by 
 
 mental laziness, at times by political 
 pressure, often by social influence, the 
 truth is forced to hide its head in 
 sorrow — while the Fate of the World 
 hangs in the balance. 
 
 It is proper that men in uniform 
 should take what comes to them, good 
 or bad, without comment, but should- 
 a nation supposed to base its greatness 
 upon the individualism of its citizens 
 be content when those citizens best 
 informed maintain silence as they 
 sense disaster creeping upon them? 
 The geese of ancient Rome were 
 credited with a better performance. 
 
 Even with the "official collar about 
 their necks" as one often hears it ex- 
 pressed in Washington, is it not con- 
 ceivable that a little patriotic cooper- 
 ation could have led to the formation 
 of a Grievance Committee for the pur- 
 pose of passing along worthy ideas to 
 the President's overworked Chief Ex- 
 ecutives? Out of that might not one 
 reasonably expect the creation of a 
 Planning Committee or Chief whose 
 time clear of daily detail should be 
 free to work out improvements of 
 organization and plan? 
 
 But no such result appeared, so 
 apparently many of America's com- 
 mercial, industrial, financial and 
 other leaders must share with our ex- 
 ecutives at least part of the criticism 
 of the nation if our war efforts are 
 found to be unequal to the need. 
 
 Perusal of the minutes of the Coun- 
 cil of National Defense might assist 
 in apportioning the blame for the pur- 
 pose of strengthening the weakness. 
 
 [4] 
 
II 
 
 Co-ordination — the Missing Link 
 
 Shipping is the weakest link of our 
 chain of preparations necessary to 
 prevent defeat and even more neces- 
 sary to win victory. This has been 
 increasingly evident since last March. 
 Had we possessed an adequate statis- 
 tical force under control of a real Gen- 
 eral Staff, or a real National Planning 
 Committee or Chief, this weakest link 
 would have been expressed in mathe- 
 matics so convincing that not even a 
 week's delay in strengthening it would 
 have been tolerated by the people or 
 their leaders. 
 
 A rumor last Spring said that the 
 Army War College had figured out 
 the tonnage necessary to send the 
 American Army to France. Some 
 weeks later a Chairman of an im- 
 portant Committee of the Council of 
 National Defense was working fev- 
 erishly to locate figures upon which to 
 base his Committee's work, figures 
 showing the amount of equipment and 
 supply per soldier, and guns and am- 
 munition needed for the American 
 forces to be sent abroad, figures based 
 upon experience of European forces 
 but modified to suit our peculiar con- 
 ditions. Many departments were 
 working just as earnestly to ascertain 
 the corresponding figures relating to 
 their individual problems. Little cen- 
 tralized effort was visible — it seemed 
 to be each one for himself. Even the 
 help of outside private individuals 
 was sought, so little had the Govern- 
 ment to offer. British, French and 
 other officers and advisers came and 
 went — their help only partially used. 
 The wealth of foreign experience spas- 
 modically tapped by individual seek- 
 ers, — no comprehensive plan was ap- 
 plied for obtaining the utmost of that 
 
 wealth for the greatest number of our 
 people who could help our country to 
 profit by it. 
 
 And in our ninth month at war, 
 December 13, 1917, Bulletin No. 79 
 of the State Councils Section of the 
 Council of National Defense makes 
 this ingenuous admission : 
 
 "The immensity of the task of 
 building vessels sufficient in ton- 
 nage to transport our army to 
 France, maintain it there, supply 
 the increasing demand of our allies 
 for munitions, food, and supplies, 
 and at the same time overcome the 
 inevitable loss from submarines, 
 has been until recently lost sight of 
 in our recent military, diplomatic 
 and economic activities. We are 
 separated by the Atlantic Ocean 
 from the field of battle, and the 
 fundamental fact is that without 
 adequate shipping we shall be whol- 
 ly unable to do our share in win- 
 ning the war." 
 
 Danger and the Remedy 
 The most important single task be- 
 fore us has been lost in the flood of 
 detail! Is any other argument needed 
 for a Planning Chief, responsible to 
 the President, backed by authority, 
 reinforced with statisticians and ex- 
 perts, free from the departmental rou- 
 tine and responsibility that unavoid- 
 ably narrow the vision and restrict 
 the broad action of every one of our 
 Cabinet Chiefs, our Fuel, Food, Ship- 
 ping and other important Executives? 
 
 Upon whom are we relying to insure 
 that we do not produce millions of 
 tons of supplies and material of 
 secondary importance now, and 
 
 [5: 
 
neglect to send to the front the 
 things they most need there im- 
 mediately? 
 
 But with shipbuilding placed in its 
 position of first importance, what is 
 being done to insure primary effi- 
 ciency and speed in building ships? 
 
 Our Priority of Materials Commit- 
 tee, which has the authority to decide 
 what materials and products shall 
 
 have precedence in transportation and 
 production, admit that nearly every- 
 thing (80 to 85% in some districts, it 
 is said) is now in the A class, so in 
 fact priority means little. However, 
 the shipbuilders appear satisfied that 
 they can obtain their structural 
 shapes, the ship plates, the engines, 
 boilers and auxiliaries they need with 
 the conditions and control already in 
 sight. 
 
 [6] 
 
Ill 
 Labor the Unsolved Problem 
 
 Priority of labor is another matter. 
 The manager of a shipbuilding plant 
 in the Chesapeake Bay district has 
 recently stated that certain skilled 
 labor in his plant has been receiving 
 $30 per week but constructors on War 
 Department work in the neighborhood 
 are now paying $70 for the same class 
 of labor in order to speed their con- 
 struction, hence shipbuilding suffers. 
 Shipbuilders on the Delaware and else- 
 where have been forced to bid against 
 Government and private employers 
 both to hold their old workmen and to 
 increase their staffs. New shipyards 
 have made a specialty of enticing by 
 fabulous rewards the best workmen 
 and executives from old shipyards. 
 
 According to Burton J. Hendrick in 
 The World's Work of December, 1917, 
 riveters are receiving from $57 to 
 $172 per week. He says further "the 
 one basic fact is that we have plenty 
 of skilled workmen in the United 
 States. The problem resolves itself 
 merely into one of recruitment and or- 
 ganization. At present these skilled 
 mechanics are making pleasure auto- 
 mobiles or engaged in a thousand in- 
 dustries that only remotely assist our 
 military operations. These men should 
 be taken from unnecessary occupations 
 and stationed in the shipyards * * * 
 At present our national army contains 
 many thousands of skilled mechanics. 
 "A man in a shipyard is worth three 
 in the trenches," says Mr. Hurley. 
 The one fact that stands out above all 
 others is that only the Federal Gov- 
 ernment itself can handle this labor 
 problem. Under the private competi- 
 tive system these yards will never get 
 their 500,000 shipbuilders. We • can 
 no more build up an industrial army 
 
 by private initiative that we can build 
 up our military and naval forces in the 
 same way." 
 
 Mr. Hendrick proposes controlling 
 shipworkers' wages in districts arbi- 
 trarily delimited. Even so, what is to 
 prevent private or government com- 
 petition from emptying those yards? 
 
 Another student of the labor and 
 shipbuilding situation writes as fol- 
 lows: 
 
 Reasons for Delay in the 
 Production of Ships 
 
 "Increase in Cost of Labor and Mate- 
 rials. Practically all contractors for 
 ships (and this applies to con- 
 tractors for war materials of all 
 sorts) have objected to signing con- 
 tracts on a fixed sum basis for the 
 reason that they have been uncer- 
 tain as to what prices they might 
 have to pay for labor and raw 
 materials. This has resulted in 
 great delays in the signing of con- 
 tracts. The increase in the cost 
 of raw materials is itself directly 
 due to increased wages paid to the 
 workmen producing these raw ma- 
 terials. The increase in the wages 
 demanded by workingmen actually 
 engaged in the production of ships 
 has been very great. 
 
 Strikes. Increases in the cost of 
 labor in nearly every industry in 
 the country have been the result 
 of strikes instituted and encouraged 
 in almost every case by leaders of 
 organized labor. 
 
 Increase in Cost of Ships. In- 
 creases in wages have been respon- 
 sible for increasing the cost to the 
 people of the United States to sev- 
 
 [7] 
 
eral times their normal cost of 
 munitions, aeroplanes and the like. 
 Ships now cost over $160 per dead- 
 weight ton that could formerly be 
 built in this country for $40 to $50 
 per deadweight ton and in Euro- 
 pean countries for as low as $30 
 per deadweight ton. On an order 
 of 6,000,000 gross tons of shipping 
 the added cost to the people of the 
 United States is about $900,000,- 
 000 over what it would be under 
 normal conditions. Similar condi- 
 tions in all war industries exist, 
 thus showing why. our appropria- 
 tions are so much more than those 
 of our allies. 
 
 Attitude of Organized Labor. 
 The attitude of organized labor is 
 best shown in brief by the words 
 of James McConnell, President of 
 the National Boiler Makers' Union 
 publicly stated to the effect that 
 workmen were urged by him not 
 to stand behind the President but 
 to "stand behind themselves" by de- 
 manding wage increases not of 
 "cents" but of "dollars." 
 
 Investigation properly made will 
 show that workmen have been ac- 
 tually encouraged in their demands 
 for more wages by the representa- 
 tives of the Department of Labor 
 itself. This occurred during the 
 recent strikes in the various ship- 
 yards in the Port of New York. 
 
 Public Opinion Needed 
 
 "The demands for higher wages 
 that have been made by workmen 
 have not been due to the high cost 
 of living except possibly in a few 
 instances. This can be proved by 
 consulting the payrolls and records 
 of various shipyards, which will in- 
 dicate that large numbers of work- 
 men have been receiving such high 
 wages that they will not work for 
 the full number of working days 
 
 per week. This fact effectually dis- 
 proves the claim of organized labor 
 that higher wages are required to 
 meet the higher cost of living. 
 
 In order to hold workmen in their 
 shipyards, contractors have been 
 forced to pay almost any wages de- 
 manded. From conditions reported 
 to the Navy Department in the case 
 of five yards, it can be shown that 
 on a tonnage of approximately 
 35,000 tons this serious condition 
 rendered possible a loss to the Gov- 
 ernment in labor charges alone of 
 approximately $3,600,000. On an 
 order for 6,000,000 tons of ships this 
 would represent a loss to the people 
 of approximately $600,000,000. The 
 wages of workmen doing the same 
 work at different yards all in the 
 same vicinity vary as much as 40%. 
 
 The average workman does only 
 about 1-3 to 1-2 as much work per 
 day as he is physically capable of 
 doing. Were all the workmen in ship- 
 yards and other war industries edu- 
 cated to the full realization of their 
 patriotic duty they could thus turn 
 out two or three times as much work 
 per day as they ordinarily turn out. 
 Had publicity measures similar to 
 those used in promoting the sale of 
 Liberty Bonds been put into opera- 
 tion in all industrial plants produc- 
 ing war materials, the production 
 could have been stimulated several 
 times without any increase in 
 force." 
 
 Does Delay Help? 
 
 It becomes increasingly clear that im- 
 provement in the labor field cannot be 
 expected until some semblance of a 
 unified national policy and action ap- 
 pears. Labor unrest must increase as 
 long as the suspicion is justified that 
 unreasonable profiteering is at all 
 prevalent. 
 
 [8] 
 
The Farmers' Non-Partisan League 
 last Summer prepared a book to show 
 the iniquities of Capital, its perver- 
 sion of public opinion by extensive 
 advertising campaigns conducted by 
 railroads, packers and large corpora- 
 tions, the political influence unduly 
 exerted by bankers and other "promi- 
 nent citizens." The leaders of the 
 League and many farmers were re- 
 ported by an investigator to believe 
 that Capital rather than Germany is 
 their real enemy. 
 
 Britain met this condition by taking 
 80% of the war profits. One of 
 her best-informed leaders predicts that 
 this tax will never be removed. 
 
 When the worker sees his restless 
 neighbor repeatedly changing his oc- 
 cupation for higher wages, the steady 
 man must begin to wonder who is 
 looking out for his interest. The 
 small-salaried employee is especially 
 helpless. 
 
 Under a proper system of employ- 
 ment exchanges it seems reasonable 
 to believe that workers skilled in cer- 
 tain trades not especially needed could 
 be rapidly transferred to the more im- 
 portant trades provided they were as- 
 sured their established wages, plus 
 whatever additional expense might ac- 
 crue from their change of location, 
 considering relative living costs, and 
 provided also that equivalent comforts 
 were offered to them in their new loca- 
 tion. When conditions do not furnish 
 equivalent comfort or convenience spe- 
 cial reward in the form of additional 
 compensation could be legitimately 
 provided. 
 
 The testimony of our Shipping 
 Board executives before the Congres- 
 sional Committee illustrates the dan- 
 ger of having no permanent mechan- 
 ism charged with studying delays and 
 obstacles and placing the remedy in 
 the hands of those authorized to 
 apply it. 
 
 If President Wilson, or Congress, or 
 the country had been persistently told 
 by the Shipping Board or the Emer- 
 gency Fleet Corporation to what ex- 
 tent lack of housing and transpor- 
 tation facilities was hindering ship 
 construction is it conceivable that ade- 
 quate commandeering powers, or spe- 
 cial laws or instructions would have 
 been long withheld? 
 
 Labor Regulation Vital 
 
 Irregularity of employment has in 
 the past been considered our worst in- 
 dustrial evil. There is, of course, no 
 excuse for continuation of that evil 
 while the whole world is confronted 
 with a shortage of labor. Until our 
 Federal Government is able intelligent- 
 ly to direct the ebb and flow of labor, 
 it must fail to meet our war needs. 
 Thoroughly coordinated employment 
 exchanges, adequate statistics kept up 
 to date, comprehensive information as 
 to the relative importance of labor 
 shortage in various fields are indis- 
 pensable to meet this situation. 
 
 In addition, both the public and the 
 Government are warranted in demand- 
 ing of employer and employed that 
 each shall live up to his agreements, 
 that each shall insist upon having re- 
 sponsible leadership, that each shall 
 stand united against unfair demands 
 and unfair conditions. 
 
 In the last analysis the unbiased 
 public must decide what is unreason- 
 able and what is unjust. Above all, 
 it must not tolerate any procrastina- 
 tion in investigation or settlement of 
 labor difficulties, for both Britain and 
 Australia have pointed out the su- 
 preme importance of speed in such 
 matters. 
 
 The public also must insist upon each 
 side acquiring sympathy for the diffi- 
 culties of the other side. In many 
 communities today comprehensive 
 study of the minimum scale of living 
 
 [9] 
 
commensurate with good citizenship 
 and good work is well under way. 
 
 If our Trade Unions, instead of en- 
 deavoring to limit the number of ap- 
 prentices and output per man, would 
 endeavor with equal earnestness to 
 stimulate their members, to educate 
 them to a sense of their importance 
 and responsibilities, to understand 
 and apply proven economic principles, 
 there would be less opposition to the 
 extension of labor organizations in 
 America by employers who find it 
 easier to fight the spread of labor or- 
 ganizations than to stop the abuses 
 which too often appear after organiza- 
 tion has been effected. 
 
 Exemption of Skilled Workers 
 
 The British when they learned the 
 imperative need for skilled workers at 
 home endeavored to recall them from 
 the army. As records were lacking 
 showing completely the past experi- 
 ence of her soldiers only part of her 
 skilled men at the front could be lo- 
 cated. Many preferred to fight and 
 so did not voluntarily report their skill. 
 Their officers, finding the skilled work- 
 ers made excellent and useful soldiers, 
 connived to keep them in the trenches. 
 This sad experience was freely re- 
 ported in Washington by various Brit- 
 ish visitors. Last Spring when our 
 Army and Navy were being recruited 
 by volunteers letters were sent to 
 Washington complaining of the enlist- 
 ment of skilled shipworkers east and 
 west. Early in May Secretary Baker, 
 speaking as Chairman of the Council 
 of National Defense, told the Govern- 
 ors and their representatives, then as- 
 sembled in Washington, that about 
 600,000 volunteer recruits were still 
 needed to fill the Regular Army, Na- 
 tional Guard and the Navy and no ex- 
 emption plan was contemplated. When 
 the draft plan was worked out only 
 
 partial provision was made to locate 
 the skilled men, and many important 
 war industries, including shipbuilding, 
 are now said to be suffering from loss 
 of important men drafted. Over 
 1,500,000 men have been almost indis- 
 criminately withdrawn from indus- 
 try while Government and citizens vie 
 with each other in increasing the 
 difficulty. 
 
 With a well-informed Planning 
 Chief having the ear of the President, 
 is it likely that this fundamental weak- 
 ness could have been so long tolerated ? 
 
 What Remedy Is in Sight? 
 
 The Bulletin Number 79 previously 
 quoted further says: 
 
 "The work asked of the State 
 Councils will in a general way be in 
 three stages. 
 The first stage will be : 
 
 (a) To make certain that the con- 
 ditions in and about the yards 
 are ready for an influx of me- 
 chanics. (This will include 
 assistance in improving hous- 
 
 . ing conditions and the utiliza- 
 tion of the system of employ- 
 ment exchanges now being 
 developed, about which you 
 have already been advised by 
 this Section.) 
 
 (b) To create the feeling in ship- 
 yard communities that ship 
 construction is of the highest 
 importance, and that the arti- 
 sans in the shipyards must re- 
 ceive recognition from the pub- 
 lic as patriotic members of the 
 community, entitled to good 
 living conditions, hospitable 
 reception, and entertainment. 
 (The Government recognizes 
 the work as patriotic by treat- 
 ing the service as parallel 
 with that of the Army and 
 Navy, as no men will be with- 
 
 [i°: 
 
drawn from this work for the 
 Army or Navy, a fact that 
 should be widely published dur- 
 ing each stage of the work.) 
 
 The second stage will be a cam- 
 paign to recruit men already in ship- 
 building trades for immediate em- 
 ployment in the yards. 
 The third stage will be : 
 
 (a) To continue the recruiting of 
 trained shipyard workers. 
 
 (b) To obtain artisans skilled in 
 related trades and train them 
 in ship construction under 
 service conditions, means for 
 which will shortly be installed 
 in the larger shipyards. 
 
 In all this work, this Section and 
 the State Councils are to have the 
 cooperation of the Labor Depart- 
 ment's War Emergency Employ- 
 ment Service (including the Public 
 Service Reserve, and the system of 
 Federal and State Employment ex- 
 changes organized in accordance 
 with our letter to State Councils un- 
 der date of December 8, 1917), the 
 Woman's Committee, the United 
 States Chamber of Commerce, the 
 Federal Board for Vocational Edu- 
 cation, the Division of Films of the 
 Committee on Public Information, 
 the Housing Committee of the 
 Council of National Defense, and 
 local housing committees. 
 
 Living conditions in some ship- 
 building communities are such that 
 the second stage of the work may 
 be entered upon at once, and at such 
 points the State Councils will be 
 asked shortly to begin recruiting. 
 In all other places, the first work of 
 the State Councils will be to see 
 that their local committees work 
 with Federal agencies in study- 
 ing and improving housing and 
 living conditions and by publicity 
 
 to create a favorable community 
 sentiment. 
 
 As a first definite step, we ask 
 you now to appoint or designate a 
 committee to take charge of all 
 State Council work in connection 
 with shipbuilding. 
 
 On such committee we suggest 
 representation as follows: 
 
 (1) An employer, known for his 
 fairness. 
 
 (2) A representative of labor, 
 known for his fairness. 
 
 (3) A representative of the State 
 Division of the Woman's Com- 
 mittee. 
 
 (4) A publisher. 
 
 (5) A college president, a dean of 
 a college, or a prominent econ- 
 omist. 
 
 (6) A publicist. 
 
 Of these, the first three are 
 deemed essential. Discretion can 
 be used as to the balance of the 
 suggestions, also as to the number 
 constituting the committee." 
 
 What Hope? 
 
 Is one justified in expecting speedy 
 settlement of our labor uncertainties 
 by such complicated and experimental 
 efforts at coordination and control? 
 
 The following bulletin was recently 
 issued by the Patriotic Education 
 Society : 
 
 Wanted— A Labor Policy 
 
 "Mr. Asquith, ex-Prime Minister of 
 Great Britain, in the House of Com- 
 mons last month stated that labor is 
 the keynote of the British war sit- 
 uation. In this country at the pres- 
 ent time is a small group of En- 
 glishmen who have had general ex- 
 perience with the labor problems of 
 Great Britain in connection with 
 
 [11 
 
the British Ministry of Munitions. 
 Captain Asquith, one of the mem- 
 bers of this group, has prepared a 
 condensed memorandum outlining 
 some of the chief lessons the Brit- 
 ish have learned relating to these 
 problems. This memorandum 
 starts: 'The main problem of the 
 war in England has proved to be 
 that of man-power.' 
 
 In November, 1916, at one of the 
 darkest periods of Britain's war ex- 
 perience, when Russia's adherence 
 to her Allies was uncertain, a seri- 
 ous discussion occurred in Parlia- 
 ment and in the press over the ad- 
 visability of pledging the nation's 
 credit for the rehousing of the 
 working people of Great Britain. 
 
 As a result of the government 
 control of munition plants, a unit 
 of measurement was developed 
 which for the first time in indus- 
 trial history on a large scale made 
 it possible for Great Britain to 
 measure the effect on her working 
 population of hours of labor per 
 day, days of labor per week, hot 
 lunches, sanitary working and liv- 
 ing conditions, periods for rest, and 
 many other items. As a result it 
 became possible to measure in 
 pounds, shillings and pence the ef- 
 fect of working and living condi- 
 tions on the human being and on 
 production. 
 
 In the United States, out of a 
 population of say 110,000,000, are 
 2,000,000 organized workers. In 
 Great Britain, out of a population 
 of 46,000,000 are 4,500,000 members 
 of trade unions. A series of na- 
 tional strikes in Great Britain re- 
 sulted before the war in an organ- 
 ized development of trade unions 
 and of employers' associations, so 
 that when the war started the gov- 
 ernment was able to step in and 
 work with capital and with labor as 
 
 units, instead of with a heterogene- 
 ous group of workers and em- 
 ployers. 
 
 In September, 1916, when the 
 British railway workers demanded 
 an increase of wages, surprisingly 
 accurate statistics were produced 
 showing that in the two years and 
 one month since the beginning of 
 the war the cost of living for that 
 class of workers had increased, ac- 
 cording to our recollection, 54%; 
 whereas their wages had been ad- 
 vanced, for instance, 25 to 30%. 
 Needless to say, on this mathemati- 
 cal showing an increase of wages 
 was granted and fully indorsed by 
 public opinion. 
 
 In America over 10% of all work- 
 ing people are always out of work, 
 on the average; this being due 
 chiefly to seasonal employment and 
 similar inefficiencies. Through sick- 
 ness each one of 'our 30,000,000 
 workers loses on an average nine 
 days per year, causing a monetary 
 loss of $700,000,000. 
 
 The following facts are compiled 
 by C. E. Knoeppel, Efficiency Engi- 
 neer, of 101 Park Avenue, New 
 York: "700,000 workers are in- 
 jured yearly and 35,000 workers are 
 killed in industry every year. Mrs. 
 Carrie Chapman Catt says of the 
 millions of pupils entering grade 
 schools yearly one-half never finish 
 the course, 5% enter high school, 1-8 
 of 1% go to technical schools, and 
 about 4-5 of 1% get a college train- 
 ing. Our average unemployment 
 prior to the war was 14% as against 
 8% in Great Britain and 2% in Ger- 
 many. Six hundred thousand per- 
 sons die annually from preventable 
 diseases. Of 300,000 infants that 
 die each year it is estimated that 
 one-half could be saved by measures 
 within the control of their commu- 
 nities. United States Health Bulle- 
 
 [12; 
 
tin No. 76 says that between 1900 
 and 1913 the average retail prices 
 of food increased 60%, while during 
 the same period wages increased 
 30%. Our annual income of $35,- 
 000,000,000 shows the largest pro- 
 portionate increase of any nation, 
 yet we rank fifteenth in the relative 
 number of savings bank accounts. 
 Charles P. McNeil, Chairman of 
 the Committee on Labor Exchanges, 
 in a report to the Chamber of Com- 
 merce of the United States, says 
 that for twelve manufacturing es- 
 tablishments employing 40,000 men, 
 the loss in one year from discharg- 
 ing men and employing substitutes 
 was $831,000, with no advantages as 
 an offset. It is estimated that the an- 
 nual waste from preventable death 
 and disease is $1,500,000,000." 
 
 There is an enormous labor re- 
 serve in this country which should 
 be drawn upon in these times of 
 stress. The East Side in New York 
 has a large supply. Mr. Wood, Pres- 
 ident of the American Woolen Com- 
 pany, was recently deploring the dif- 
 ficulty of obtaining sufficient labor. 
 These reserve supplies were men- 
 tioned to him, and upon reflection 
 he agreed that they actually exist, 
 and pointed out that in one of his 
 factories he had recently installed 
 an escalator, or moving stairway, 
 with the result that some women 
 who had not worked in his factory 
 before were now able to do so. Mr. 
 E. N. Hurley, of the United States 
 Shipping Board, recently returned 
 from a tour of important shipbuild- 
 ing yards and stated that some of 
 those yards had only 50% of the 
 labor they needed. 
 
 Great Britain has a national em- 
 ployment bureau reaching to every 
 town and hamlet. The ebb and flow 
 of labor is directed and controlled 
 through that employment exchange. 
 
 [13] 
 
 In our country the Departments of 
 Labor and Agriculture, War and 
 Navy, the Council of National De- 
 fense, the Shipping Board, the Fuel 
 and Food Dictators. — all have labor 
 committees and problems, but there 
 is no real coordination. In the De- 
 partment of Labor itself are two 
 rival employment establishments. 
 One, headed by Mr. Caminetti, 
 Chief of the Bureau of Immigra- 
 tion, controls the 93 employment ex- 
 changes operated by the government 
 in different parts of the country. 
 The United States Public Service 
 Reserve is attempting to list and 
 make available for national service 
 the labor, unskilled, skilled and pro- 
 fessional, of this country. This 
 latter mechanism was established 
 by private initiative and largely 
 with private funds. An effort was 
 made to obtain an appropriation of 
 $750,000 from the recent Congress 
 for a national labor bureau. This 
 was opposed, according to common 
 report, by the Bureau of Immigra- 
 tion, and it was only at the last min- 
 ute, largely through private initia- 
 tive, that an appropriation of 
 $250,000 was made available for this 
 work. But the bill provided that 
 existing institutions should be pre- 
 served. Under these conditions Mr. 
 Caminetti cannot be "merged" into 
 one homogeneous department of the 
 Department of Labor. 
 
 We have no adequate record of 
 strikes, and in August an investiga- 
 tion showed that the Department of 
 Labor had fewer investigators to 
 study strike problems and settle- 
 ments than it had June 1st, owing 
 to lack of appropriations. 
 
 Major-General Maurice, Director 
 of British Military Operations, is 
 recently reported as having shown 
 that the shipment of British war 
 supplies into France from January 
 
to September, 1917, increased in the 
 proportion of 245 to 114, the ton- 
 nage and human labor problem thus 
 more than doubling in eight months. 
 One of the leading British labor ex- 
 perts of the British Ministry of 
 Munitions, himself a wealthy em- 
 ployer of labor, is reported to have 
 said recently that America is twen- 
 ty years behind the times in labor 
 matters. In Great Britain the man 
 who cannot change his mind over 
 night is hopelessly behind. 
 
 The world is just beginning to 
 recognize generally that human be- 
 ings have inherent rights which 
 cannot be morally balanced against 
 the rights of capital. German pat- 
 riotism has been founded largely 
 upon Bismarck's far-sighted policy 
 which recognized the right of man 
 to work, to shelter, to reasonable 
 living conditions, and to freedom 
 from worry against illness and old 
 age. The man with only a dime in 
 his pocket is no match against the 
 capitalist. The organized labor 
 movement has been essentially an 
 uplifting movement. In a democ- 
 racy every individual belongs to the 
 ruling class, and a ruler who is too 
 tired, too worried or too ill to per- 
 form his functions is a menace to 
 the country. That there have been 
 abuses in the name of organized la- 
 bor is unquestioned, and so there 
 have been abuses in the name of lib- 
 erty and of religion. The excesses 
 of the French Bevolution are no ar- 
 gument against democracy. Leisure, 
 liberty and leadership all need expe- 
 rience and practice. The great unbi- 
 ased American public opinion must 
 be the arbiter as to what labor may 
 justly demand and what privileges 
 capital may retain and must yield. 
 
 Sociological changes have re- 
 sulted from this war, of importance 
 and scope far beyond what is gen- 
 
 [14; 
 
 erally appreciated in America. For 
 the very safety of the nation and 
 the winning of this war American 
 public opinion must be directed to 
 the fundamentals involved in order 
 that it may take a firm and unyield- 
 ing stand against abuse on the part 
 of both employer and employee, and ' 
 in favor of justice to both. It is 
 neither safe nor fair to expect the 
 biased parties themselves to hold 
 the balance of power. As Justice 
 Louis D. Brandeis has so well said, 
 "Neither our intelligence nor our 
 characters can long stand the strain 
 of unrestrained power." 
 
 To avoid the jealousies, inertia 
 and difficulties of attempting to con- 
 trol the labor problem through any 
 established peace-time department, 
 and because the matter is even more 
 important than that which caused 
 the creation of a food, fuel and a 
 shipping dictator, the time may 
 come when it will be necessary for 
 the public to demand a labor dicta- 
 tor for the period of the war — one 
 who can show the public what the 
 worker may justly demand, what 
 the employer under the new world 
 conditions may hold, and v/hat he 
 must yield ; one who can organize a 
 national employment bureau capable 
 of satisfying national employment 
 needs ; one who can develop a statis- 
 tical force, backed with adequate 
 financial support, to study continu- 
 ally the changing cost of living for 
 the various workers in each section 
 of the country in comparison with 
 wages; so that fact, instead of 
 guesswork, hunger and strikes, may 
 be the basis of the square deal. Such 
 statistics, coupled with Federal 
 Trade Commission figures showing 
 the cost of production, would put 
 much of the labor problem in math- 
 ematical form, so that he who runs 
 may read." 
 
Labor Troubles Not 
 Recorded 
 
 It is variously estimated that since 
 America entered the war there have 
 been from three to five thousand 
 strikes in this country. Who can say 
 at this moment whether those strikes 
 have not already seriously threatened 
 the victory of our cause and at best 
 have immeasurably postponed it and 
 increased the cost? Certain it is that 
 without harmonious action on the part 
 of worker, employer, the Government 
 and the public our utmost war efforts 
 must fail. There are at least eight 
 major labor committees heading up 
 to various cabinet chiefs and the 
 
 Administrators. Today we know that 
 our greatest need is ships, but, be- 
 cause the labor factor is the weakest 
 spot in our shipbuilding program, we 
 must especially focus attention upon 
 the shipbuilding labor situation. 
 
 It is obvious to all who have inves- 
 tigated that no important phase of the 
 labor situation can be considered with- 
 out including the other important 
 phases. Thus the fact that in New 
 York several theatres, hotels, and 
 many office buildings are being con- 
 structed at the present time has a dis- 
 tinct bearing upon the scarcity of 
 skilled labor readily available for ship- 
 building. 
 
 [15] 
 
IV 
 
 British Labor Experience 
 
 Sir Stevenson Kent, Director Gen- 
 eral of the British Labor Supply De- 
 partment of the Ministry of Muni- 
 tions, accompanied by several other 
 labor experts, has been in this country 
 for several months and has placed at 
 the disposal of Americans the experi- 
 ence Great Britain has had in connec- 
 tion with labor since the war began. 
 Sir Stevenson has recently been 
 quoted as saying: 
 
 "If Great Britain had had one- 
 eighth of the number of labor troubles 
 in the past two years that the United 
 States has had, my country would 
 have had to conclude a disgraceful 
 peace with Germany by this time. 
 Since coming here two months ago I 
 have noted serious strikes and threats 
 of strikes in different parts of the 
 United States. Not only does such a 
 state of affairs indicate trouble in 
 this country, but it cannot fail to af- 
 fect seriously Great Britain and the 
 other Allies." 
 
 H. W. Garrod, Deputy Assistant of 
 the British Labor Regulation Depart- 
 ment, one of his companions, is quoted 
 thus: 
 
 "In every city that we have visited 
 in the United States we have tried to 
 put one fact of our experience before 
 you — (that no nation under modern 
 conditions can possibly hope to carry 
 through a great war, such as the pres- 
 ent, unless it can maintain industrial 
 peace at home. I say that because 
 since we have been in this country, a 
 matter of about two months, there 
 have occurred a number of very seri- 
 ous industrial disturbances. If one- 
 eighth of those troubles had occurred 
 in England during the whole period 
 of the three years that we have been 
 
 at war, we should have had to make, 
 long ago, a disgraceful peace." 
 
 Some employers of labor have shown . 
 indifference to the British experience, 
 claiming that American conditions 
 were so different from those of Great 
 Britain that little benefit could result 
 from comparisons. Whether or not 
 this is true it is evident that the Brit- 
 ish government quickly recognized 
 the importance of labor, took labor 
 into close confidence and partnership, 
 and based all of its activities and 
 future plans upon that partnership. 
 
 The Industrial Bureau of the Mer- 
 chants' Association of New York has 
 prepared a condensed summary of the 
 British Labor regulations and this 
 seems sufficiently illuminating to 
 quote in full: 
 
 How British Industry Was 
 Adapted to the War 
 
 "In England the method of agree- 
 ment, the method of conference, has 
 ordinarily been employed in draw- 
 ing up industrial legislation affect- 
 ing employer and employee. It 
 has never been considered possible 
 to introduce drastic legislation on 
 labor questions unless the consent 
 in general of the parties to be af- 
 fected by the legislation could first 
 be obtained. 
 
 Government, Employers, Employed 
 
 There are in England great fed- 
 erations of employers. All large 
 machine shops there belong to fed- 
 erations of this nature. Moreover, 
 the greater part of labor belongs to 
 labor organizations. Consequently, 
 when planning any labor legisla- 
 
 te] 
 
tion, they have first brought togeth- 
 er in London the representatives 
 of the trades concerned — the per- 
 sons who could speak authoritative- 
 ly for the great employing federa- 
 tions and the persons who could 
 speak for the trade unions affected. 
 This was the method particularly 
 adopted in March, 1915, when the 
 labor situation in England was very 
 serious. The Ministry called to- 
 gether in one room representatives 
 of the employers who were directly 
 concerned with the manufacture 
 of munitions and the heads of the 
 principal trade unions. During 
 that conference they arrived at the 
 Treasury Agreement which was 
 subsequently embodied in the Muni- 
 tions of War Act. This Act is the 
 legislation by agreement between 
 government, capital and labor. It 
 covers practically everything that 
 could be manufactured for war pur- 
 pose. There was not a single clause 
 in it that had not been the subject 
 of discussion and agreement be- 
 tween those three interests. 
 
 Features of the British Agreement 
 
 The following were the principal 
 features of this agreement: 
 
 (1) The Minister of Munitions 
 received power to control factories 
 engaged principally on the manu- 
 facture of munitions. The control 
 of these factories amounted to a 
 right of the Minister of Munitions 
 to take the plant over altogether 
 from the owners. That right has 
 been rarely exercised and exercised 
 only when the management failed 
 to comply with the requirements of 
 the Government. Such cases have 
 been very exceptional, probably 
 only two or three in number. As a 
 part of his powers in regard .to 
 these factories (and this actually 
 
 became law) the Minister of Muni- 
 tions has definite authority to limit 
 the profits of such plants. The 
 profits were limited to an increase 
 of one-fifth over an average of the 
 profits of the two years preceding 
 the war. 
 
 (2) The trade unions agreed 
 that in view of the fact that a defi- 
 nite limitation had been put on 
 profits, the wages of the employees 
 should be fixed at the rates which 
 existed at that time. There was to 
 be no fluctuation upwards or down- 
 wards in the wages except by con- 
 sent of the Minister of Munitions. 
 It was agreed that neither capital 
 nor labor should make a profit out 
 of the Nation's needs. The Govern- 
 ment, having fixed wages, appreci- 
 ated that it became its duty to see 
 that the labor so dealt with should 
 not suffer from the increased cost 
 of living. It set up a Committee on 
 Production. One of the duties of 
 this Committee consisted in hearing 
 evidence' as to the increased cost of 
 living three times every year. Evi- 
 dence is brought before it by trade 
 unions' officials or any one con- 
 cerned, and the Committee has all 
 the Government statistics in regard 
 to the increased cost of the neces- 
 sities of life. Assuming that the 
 living costs have gone up, the Com- 
 mittee then makes (in the nature 
 of a war bonus) a national award 
 to all employees on war work, pay- 
 able by the employer, but to be re- 
 covered from the Government. 
 
 (3) Strikes and lockouts became 
 illegal and arbitration became com- 
 pulsory. It was agreed that any 
 trade disputes in war industries 
 should, for the period of the war, be 
 submitted compulsorily to arbitra- 
 tion, which the Government should 
 arrange. A strike or lockout in 
 
 [17] 
 
peace time was looked upon as more 
 or less a domestic matter. The 
 Government rarely interfered, and 
 only when it became a widespread 
 inconvenience. However, the Gov- 
 ernment took the view that its 
 duties in peace time and war time 
 were very different. It took the 
 view that it could not tolerate in- 
 terruption of supplies resulting 
 from differences between employers 
 and employees. It took the view 
 that its duty was to interfere be- 
 tween the employers and employees 
 to prevent interruption of supplies 
 vital to the success of the armies. 
 The Government viewed this matter 
 with such gravity that power was 
 granted by the Act to imprison for 
 life any one who incited to strikes 
 or interfered with the operation of 
 the agreement. It has never be- 
 come necessary to enforce this pen- 
 alty. Public opinion has generally 
 enforced the act very effectively. 
 (4) The trade unions agreed to 
 waive all their practices_ and cus- 
 toms which tended to restrict either 
 employment or output, such as the 
 employment of only union labor, 
 and the use of only skilled persons 
 on skilled jobs; and they promised 
 to do their utmost to see that the 
 agreement was carried through. 
 They agreed also that any person, 
 man or woman, would be allowed to 
 do any kind of work. In return for 
 these important concessions the 
 Government pledged itself to re- 
 store pre-war conditions in shops 
 after the war. The trade unions, 
 their leaders, and the rank and file, 
 have abided very loyally by that 
 agreement and act. 
 
 Compulsory Arbitration 
 
 The First Munitions of War Act, 
 which was passed about a month 
 
 after the Agreement was made, set 
 up machinery for compulsory arbi- 
 tration. Despite this system of 
 compulsory arbitration, it would be 
 misleading to say that there have 
 not been labor troubles or strikes, 
 but there have been only three 
 strikes which have had to be re- 
 garded as serious, and of these none 
 has lasted more than a week. Not 
 a strike has arisen for higher 
 wages since the war began. More- 
 over, there has not been a single 
 strike in which the responsible 
 trade union officials have not stood 
 side by side with the Government 
 and done their utmost to bring 
 every man back to work at the 
 earliest possible moment. 
 
 One of 'the lessons which has 
 been learned in England is that the 
 war is a war of the civil organi- 
 zations — of mechanism and me- 
 chanics, of the machine shop and 
 the factory — just as much as it is 
 a war of the army. Organization 
 of industry at home must be as 
 complete and thorough as at the 
 front. If one leaves organization 
 at home to chance, he imperils the 
 army. Industrial peace at home, 
 continuity of supplies, and ever- 
 increasing output — these things are 
 vital if this war is to be carried 
 through to a successful conclusion. 
 
 When War Took the Men 
 
 They had in England a very big 
 drain on their man power in the 
 very early part of the war. Under 
 the system of voluntary enlistment 
 they lost skilled mechanics in large 
 numbers. Mechanics went into the 
 army and their skill was not util- 
 ized; they were used up in the 
 trenches. That was a mistake, be- 
 cause if there is one certainty it is 
 this — that neither in America nor 
 
 is 
 
England is there a sufficiency of 
 skilled mechanics. England has had 
 to make numberless shifts and use 
 people, women and men, whom she 
 would very much prefer not to have 
 employed on any of the tasks in 
 which they are engaged today. One 
 of the reasons England has been 
 compelled to make use of these 
 makeshifts is that the skill of her 
 mechanics was misused in the early 
 days of the war. 
 
 Economy Is Necessary 
 
 Every kind of economy is neces- 
 sary today, the economy of raw ma- 
 terial and of man power being the 
 two most important. Economy of 
 raw material and of man power in 
 England was brought about by a 
 system of licenses and laws. En- 
 gland has a very complete and com- 
 prehensive system of licensing and 
 priority. No raw material that is 
 essential for the production of war 
 materials can be used or bought 
 by anybody except under license. 
 If a manufacturer desires to buy 
 steel, or lead, or iron, or aluminum, 
 or anything of that type, he has 
 to make application to the Ministry 
 of Munitions and to state why he 
 wishes to purchase it. If the pur- 
 pose stated is not essential for the 
 army or navy in winning the war, 
 the license is refused. What hap- 
 pened is this: The non-essential 
 plant which was in the habit of us- 
 ing steel or other metals had its 
 license refused. The employer then 
 could either close his plant or trans- 
 form it for the purpose of under- 
 taking war work for the Govern- 
 ment. In England, it must be 
 understood, they did not have a 
 sufficiency of plants or output, and 
 they had to find them both as soon 
 as possible. By a system of indirect 
 
 [19] 
 
 compulsion, therefore, they trans- 
 formed the shops from civil work 
 to Government work and they em- 
 ployed the same man power on war 
 work. 
 
 The Shifting of Labor 
 
 The shifting of labor from estab- 
 lishment to establishment, from 
 work of great importance to work 
 of less importance, from war work 
 to civil work, has been checked by 
 a system of licenses. 
 
 No non-essential industry which 
 uses materials essential for war 
 purposes or employs labor which 
 could be used in the manufacture 
 of munitions now exists in En- 
 gland. Therefore, there is little 
 risk of labor, which is engaged in 
 the manufacture of munitions, leav- 
 ing for civil work. 
 
 It was soon found in England 
 that some manufacturers had taken 
 on orders that could not be filled 
 without a large increase in their 
 labor force. Accordingly, such 
 manufacturers had set about get- 
 ting the necessary workmen in the 
 most uneconomic way possible, that 
 is, they tried to get labor from 
 other plants. A system of labor 
 auctioneering and enticement was 
 found to be going on all over the 
 country. This situation was ended 
 by two regulations under the De- 
 fense of the Kealm Act, which 
 stated in effect that: 
 
 (1) No employer in the engin- 
 eering industry (machine shops and 
 other metal-working plants) should 
 offer an enticement or endeavor to 
 entice away an employee from any 
 other employer in that industry. 
 Should he do this, he was liable to 
 a heavy penalty. 
 
 (2) The Ministry of Munitions 
 was empowered to regulate and 
 
restrict the employment of labor in 
 any factory. If an employer offers 
 an enticement to other labor, or if 
 he is found using the labor he has 
 in an uneconomic way (holding 
 labor for future contracts or using 
 a skilled man on a machine which 
 a less skilled man could operate), 
 an embargo is laid on that firm and 
 it is not permitted to engage any 
 labor of any sort except under li- 
 cense from the Ministry of Muni- 
 tions. In this way a plant can be 
 watched and the man power in that 
 plant can be economized as much 
 as possible. 
 
 The Employment of Women 
 
 The expedients which were adop- 
 ted to deal with the shortage of 
 labor were the dilution of skilled 
 labor and the substitution of wo- 
 men for men. Both were contrary to 
 trade union practices and customs 
 as they existed before the war, 
 and were made possible only by the 
 agreement between capital and la- 
 bor. Employers brought unskilled 
 workers, men and women, into their 
 plants, put them on the easy jobs, 
 promoted the men on the easy jobs 
 to more skilled work, and in turn 
 promoted those they succeeded. A 
 case which occurred recently might 
 be mentioned as an example of that 
 process. A steel plant in Wales had 
 put up some new furnaces and the 
 Ministry was unable to supply suffi- 
 cient skilled or unskilled men to 
 operate these furnaces. Sixty-seven 
 women were employed. They did 
 not work the furnaces, but they re- 
 placed a corresponding number of 
 laborers in the plant doing wheel- 
 ing, unloading and loading of 
 bricks and other material, break- 
 ing limestone, etc. The laborers 
 so released were put on the lowest 
 
 skilled jobs in the plant — fourth- 
 hand melters and mixers — the 
 fourth-hand melters and mixers 
 were promoted to be third-hand 
 melters and mixers, and so on until 
 a full staff had been created for the 
 new furnaces. In other cases, 
 skilled men who were neither over 
 military age nor physically disqual- 
 ified for the army were brought 
 from the non-essential trades. For 
 illustration — sanitary plumbers 
 were trained to do lead burning for 
 explosive factories ; machinists 
 were taken from textile trades and 
 trained to do finer work on muni- 
 tions. 
 
 Another system operated to con- 
 fine the skilled man to the work 
 which only a skilled man can do. 
 If a skilled mechanic normally had 
 been on a job which could be split 
 up into two or three parts, he was 
 confined to the part of the job re- 
 quiring higher skill. 
 
 War Munitions Volunteers 
 
 The War Munitions Volunteers 
 system has been of tremendous as- 
 sistance to England in stabilizing 
 the labor supply and in controlling 
 priority of labor on war work. 
 
 The War Munitions Volunteers 
 are skilled workmen who have of- 
 fered their services to the Min- 
 istry of Munitions for the duration 
 of the war. They constitute a mo- 
 bile force — now numbering about 
 200,000 — which can be shifted into 
 any form of munitions work that 
 the Ministry considers especially 
 vital at any given time. 
 
 Workmen have become members 
 of the War Munitions Volunteers 
 because of the appeal of patriotism 
 and because membership carries 
 with it exemption from military 
 service. Members receive the 
 
 ;so] 
 
established rate of pay in the plant 
 which they leave, or the plant to 
 which they go, whichever be the 
 higher. 
 
 The formation of the War Muni- 
 tions Volunteers system has given 
 many of the beneficial results of in- 
 dustrial conscription without any 
 of the dangers. The Government 
 can now select men scientifically 
 whenever there is special need of 
 additional skilled workmen in any 
 factory or in any district, and these 
 men can be taken from work on 
 which their loss will be felt least. 
 About the only alternative would 
 be the offering of high wages on the 
 most vital work, which would not 
 only disturb the entire labor field 
 but might take men away from 
 work as important as that to which 
 they are changed. 
 
 Women's Wages 
 
 Later on, when practically all of 
 the useful men had been drafted or 
 had gone into munition industries, 
 the Labor Supply Department 
 adopted the scheme of using women 
 for every job women could do or be 
 trained to do. In this connection a 
 condition attached to their use, 
 agreed upon by both capital and la- 
 bor, should be mentioned. It was 
 agreed that women undertaking 
 skilled work should receive the same 
 day rate as skilled men and the same 
 piece rate. A woman's wage could 
 differ from that of a man only when 
 employed on unskilled or semi- 
 skilled work ; and then she came un- 
 der an order which fixed the mini- 
 mum wage at a rate which in 
 general came to about two-thirds of 
 the man's wages, varying with the 
 district involved. The lower rate 
 on unskilled work was due to the 
 fact that women were found to be 
 
 [21] 
 
 less effective on these general tasks, 
 because on heavy lifting and such 
 work it was found necessary to re- 
 place two men with three women. 
 The conditions of pay for women 
 have not been particularly advan- 
 tageous to employers directly, but 
 indirectly they have been of very 
 great value. As a result of the 
 good wages that women have been 
 able to earn on munitions work, em- 
 ployers have never lacked applicants 
 for almost every kind of work. At 
 the present time, the employment 
 of women in England is limited 
 only by the facilities for training 
 them. As a further result of equal 
 wages the class of women taken 
 into the munitions plants has been 
 much above the class of the factory 
 girl and the woman employed by 
 textile works before the war. 
 Women of good position and with 
 fair education have been found and 
 this has undoubtedly had a very 
 great influence on the variety of 
 work on which it has been possible 
 to employ women. 
 
 Work That Women Are Doing 
 
 The English women have done 
 far more in industry than any one 
 expected. Every one probably real- 
 ized at the beginning that there 
 would be no difficulty in introducing 
 them on simple repetition work of 
 a light character. However, since 
 the Ministry of Munitions first, to- 
 wards the end of 1915, began to 
 urge the employment of women, 
 there has been a development which 
 has surprised anybody who has 
 seen anything of it — a development 
 both in the extent to which the La- 
 bor Supply Department has found 
 it possible to staff machine shops, 
 and in the difficulty of the work op 
 which it has been able to introduce 
 
them. Shell, fuse, grenade and sim- 
 ilar repetition work of an easy type, 
 calling for no particular accuracy, 
 is obviously women's work as far 
 as the operating is concerned, but 
 there are now shops that employ 
 women on very nearly all the skilled 
 work in shell factories. One fac- 
 tory, on light shells, employs about 
 94% women. Taking shell, fuse 
 and grenade work as a whole, the 
 average number of women employed 
 is about 80%. On the skilled opera- 
 tions such as howitzer work, the 
 averages are not so high, but there 
 are individual cases which show 
 just as high a percentage of women 
 employees. In the largest English 
 explosive factory there are 15,000 
 hands, and of these, 11,000 are 
 women. On trinitrotoluol manufac- 
 ture the average is about 80% 
 women, and on the picric acid the 
 average is about 40% women. On 
 filling fuses and that class of work 
 the average is generally, well over 
 90%. 
 
 There are now in England over a 
 million women working on muni- 
 tions. They have undertaken work 
 in every industry which has any 
 bearing on munitions. Outside the 
 machine shops their work is very 
 largely laboring work, and they 
 have undertaken laboring in every 
 industry and under the worst pos- 
 sible conditions, even such condi- 
 tions as exist in blast furnaces, acid 
 works, iron and steel plants, etc. 
 
 For all simple repetition work it 
 has been found that women need no 
 training at all, but for the more 
 highly skilled work on howitzers, 
 aeroplanes, engines, etc., the Minis- 
 try of Munitions has had to help the 
 employers by equipping training 
 schools. By far the greater part of 
 the women on that work have been 
 trained in the factories themselves, 
 
 but the smaller factories have found 
 considerable difficulty in doing their 
 own training, and in many factories 
 there is too little work of this nature 
 on which women can gradually ac- 
 quire skill. The Ministry has, 
 therefore, established two classes of . 
 training establishments — training 
 schools attached to various technical 
 colleges that exist in most industrial 
 centers, and factories taken over by 
 the Ministry equipped as instruc- 
 tional plants. They do actual muni- 
 tion work in these training estab- 
 lishments. They do not attempt to 
 give general training, but they give 
 specialized training on a specific 
 type of machine, and in that way 
 the women acquire a considerable 
 degree of skill in a period of from 
 six to eight weeks. 
 
 At the beginning of the employ- 
 ment of women in 1915, practically 
 all employers in England looked 
 upon the introduction of a woman 
 into a machine shop as being one of 
 the horrors of war, but nothing has 
 been so remarkable as the change 
 in the attitude of the manufactur- 
 ers towards the employment of 
 women. Now if any question arises 
 as to the employment of a woman or 
 an unskilled man, no employer will 
 hesitate to employ the woman. She 
 has been found to be quicker in ac- 
 quiring skill and is far better and 
 faster than the type of man left in 
 the factories now. 
 
 The Shortage of Labor 
 
 A very serious shortage of labor 
 came upon England suddenly and 
 very unexpectedly, and as regards 
 skilled labor the United States is 
 probably no better off than En- 
 gland, because in the United States 
 the unskilled man has been em- 
 ployed as an alternative to a 
 
 [22] 
 
greater extent than in England in 
 peace time. It is probably only a 
 question of a few months before the 
 United States will be faced with a 
 serious shortage of labor." 
 
 The Chamber of Commerce of the 
 United States has also prepared a 
 condensed summary of important Brit- 
 ish labor changes, emphasizing some 
 points not considered in the other 
 condensation, and therefore is worthy 
 of quotation in full: 
 
 English Labor and War 
 Production 
 
 Employment of Labor 
 
 "In England today those engaged 
 in certain specified lines of business 
 may not employ men between the 
 ages of 18 and 61. This indicates 
 the extent to which England has 
 gone after three years of war in her 
 efforts to take men from the less 
 essential industries and concentrate 
 national effort on industries en- 
 gaged on war work and other work 
 of national importance. 
 
 Restrictions Removed 
 
 Early in the war it became evi- 
 dent that if the troops at the front 
 were to be furnished with munitions 
 and supplies, men at home must 
 work in a manner different from 
 that established by trade union rules 
 and practice. Restrictions upon 
 labor made it impossible to produce 
 the quantities needed. The labor 
 unions agreed to the temporary 
 modification or elimination of these 
 restrictions upon the following con- 
 ditions which were agreed to by the 
 government officials: 
 
 1. The rules and practices were to.be 
 changed only for the period of the 
 war ; 
 
 2. No changes were to be made which 
 unnecessarily affected established 
 conditions; 
 
 3. Capital was to receive no advantage 
 in the struggle between capital and 
 labor. For example, profits were to 
 be limited and wages controlled by 
 government tribunals. 
 
 Upon these conditions labor 
 agreed that there should be no stop- 
 page upon work on munitions or 
 other work required for the satis- 
 factory completion of the war. 
 
 Labor Conditions Changed 
 Three fundamental changes in labor 
 conditions were brought about: 
 
 1. In certain classes of plants strikes 
 are not lawful; 
 
 2. In such plants increases in wages 
 may be asked only to offset increased 
 cost of living; 
 
 3. Restrictions by labor unions against 
 the so-called "dilution of labor," by 
 the employment of women and of 
 unskilled labor, have been laid aside 
 for the war. Also restriction upon 
 an individual's output. 
 
 Employment of Women 
 The procedure regarding the em- 
 ployment of women illustrates the 
 situation. When men went to the 
 front women wanted to take their 
 places in the factory, but union rules 
 forbade the employment of women 
 on many kinds of work. These rules 
 were relaxed upon the following con- 
 ditions, and more than one million 
 and a half of women have in conse- 
 quence been put upon men's work: 
 
 1. No woman was to be employed if 
 any man was available for the work, 
 even if this man was at a distance; 
 
 2. Men were to be reemployed upon 
 the work when they returned from 
 the war; 
 
 3. The standard of pay was not to be 
 reduced, i. e., the minimum rates for 
 men would apply to women. 
 
 Post-War Conditions 
 Differences as to wages or condi- 
 tions of employment are settled by 
 arbitration, if possible, if not, by 
 
 [23] 
 
the Board of Trade (later the Min- 
 istry of Munitions of War). A 
 record is kept of all departures from 
 pre-war conditions. After the war 
 readjustments are to be made in 
 connection with new inventions and 
 other similar matters to create as 
 near as possible the conditions 
 which would have arisen on the 
 basis of pre-war conditions. Fur- 
 thermore, in general the government 
 is pledged to use its influence to re- 
 store after the war the conditions 
 affecting labor which existed before 
 the war. 
 
 Controlled Plants 
 
 In England today there are more 
 than 5,000 so-called "controlled" 
 plants. The use in this connection 
 of the word "controlled" is mislead- 
 ing. The operatic n of these plants 
 is not controlled or supervised. In 
 fact, so far as management is con- 
 cerned, the owners are quite as free 
 as before the war. Only profits and 
 labor are controlled. All profits of 
 such companies in excess of 20% 
 beyond the average net earn- 
 ings of the two financial years next 
 before the war are to be paid to the 
 government Exchequer. If, how- 
 ever, these average net earnings — 
 which are termed standard earn- 
 ings — are not fair in the judgment 
 of the Minister of Munitions, a dif- 
 ferent rate of earnings may be es- 
 tablished by him. In arriving at 
 this new standard of earnings the 
 Minister may consider any perti- 
 nent circumstances such as increase 
 of output, new machinery or plant, 
 alteration of plant, etc. 
 
 Where the owner has used more 
 capital or produced a greater vol- 
 ume of output than formerly, the 
 Minister is to allow him either 8% 
 per annum on the amount the 
 
 Minister decides is the amount of 
 the additional average capital or 
 such a share of the excess profit as 
 the Minister decides to be the 
 amount the owner would have 
 earned by a similar increase of out- 
 put during the pre-war period. The 
 owner has the right to have which-' 
 ever amount is the greater — the 
 8% or the additional fixed sum. 
 In figuring the additional cap- 
 ital on which ' the 8% is cal- 
 culated, there is included bor- 
 rowed money (other than govern- 
 ment loans) and also undivided 
 ascertained profits which are re- 
 invested in the business. The addi- 
 tional profits may, in the discretion 
 of the Minister, be in lieu of or in 
 addition to the permitted 20% in- 
 crease above the standard profit. 
 
 Labor in Controlled Plants 
 In such plants there may be no 
 strikes or stoppage of work. The 
 following rules apply : 
 
 A. All employees "shall attend regularly 
 and work diligently during the or- 
 dinary working hours of the estab- 
 lishment," including a reasonable 
 amount of overtime — but Sunday 
 work is not required; 
 
 B. No employee shall "insist or attempt 
 to insist on the observance either 
 by himself or by any other person" 
 of rules or customs tending to re- 
 strict production or "to limit the 
 employment of any class of per- 
 sons" ; 
 
 C. No employee shall bring intoxicat- 
 ing liquors into the establishment; 
 or be drunk in the establishment ; or 
 be guilty of a disturbance, or be 
 disobedient to lawful orders ; or tear 
 down or deface any regulations, 
 notices, etc.; 
 
 D. These rules shall not interfere with 
 the establishment's private rules; 
 but these rules are "the only rules 
 of the establishment in respect of 
 which proceedings may be taken 
 
 before a Munitions Tribunal." 
 
 A violation of the rules is an of- 
 fense under the Munitions of War 
 Act and is punishable by fine. 
 
 [24] 
 
Those engaged upon certain 
 classes of munition work are for- 
 bidden to induce workmen to enter 
 their employ by offering increased 
 wages or to bring workmen from a 
 distance of more than ten miles. 
 Such manufacturers are directed to 
 apply for all men needed to the La- 
 bor Exchange of the Board of 
 Trade. 
 
 Through the Board of Trade La- 
 bor Exchange and to meet such re- 
 quirements as those above stated 
 there has been created a volunteers' 
 Industrial Reserve in which are en- 
 rolled men and women who agree to 
 go wherever they may be required 
 by the government and to engage in 
 whatever work is given them. A 
 large number of men and women 
 have enrolled in this reserve and are 
 acting under the instructions of the 
 Ministry of Munitions. Such per- 
 sons receive, in addition to their 
 wages, a subsistence allowance from 
 the government when they are com- 
 pelled to live away from their fami- 
 lies. This is for the purpose of 
 making it possible for workmen to 
 send their entire wages to their 
 families. Where a workman is sent 
 from one district into another he 
 receives the wage of the old or new 
 district according to which is the 
 higher. 
 
 Leaving Certificates 
 
 All persons are forbidden to em- 
 ploy men within six weeks after 
 they have left work, unless the man 
 has a "leaving certificate" from the 
 last employer stating that he left 
 with the employer's consent. If 
 such leaving certificates are unrea- 
 sonably refused, the Munitions Tri- 
 bunal may issue certificate having 
 the same effect and impose a fine 
 upon the manufacturer who refused 
 the certificate. 
 
 Labor Battalions 
 As further indicating what has 
 been done to secure labor needed in 
 connection with the war, there have 
 been organized, under the army, 
 battalions of dock laborers at Liver- 
 pool, London and other ports. In 
 London alone there are said to be 
 not less than 10,000 dock workers in 
 the army engaged in dock work. 
 These battalions are sent where 
 needed to assist in unloading ships. 
 While at work they receive the reg- 
 ular worker's pay in addition to 
 their army pay. 
 
 Labor Complaints 
 
 Under the Munitions Act there 
 has been organized a National Ad- 
 visory Committee on War Output, 
 composed of seven labor representa- 
 tives, this committee to receive com- 
 plaints from labor with regard to 
 the carrying out of the Munitions 
 Act. Under this central committee 
 there have been established more 
 than 70 local committees. On these 
 committees there are only labor 
 men. The committees have no power 
 but they are said to have been of 
 material assistance in preventing 
 labor disputes. All final decisions, 
 however, must be made by the Min- 
 istry of Munitions. 
 
 Hours of Labor 
 
 There has been no limitation of 
 the hours of labor in plants but the 
 policy has been followed of continu- 
 ing such hours as are usual in each 
 business. As a matter of fact, there 
 have been such excessive hours in 
 some plants that a commission, ap- 
 pointed to investigate work and the 
 relation of hours of labor to output, 
 strongly recommend a reduction in 
 hours where work was being done 
 10, 12 and 14 hours a day, seven 
 days in the week. 
 
 [25] 
 
Training the Unskilled 
 
 To train women and unskilled 
 men classes have been formed at 
 technical schools. Also groups of 
 untrained employees have been 
 placed in plants under skilled men. 
 In these two ways the unskilled 
 have been made efficient, but it is 
 said that the classes in the technical 
 
 schools have been of greater assist- 
 ance in developing skilled labor. 
 
 It is evident from the above that 
 the policy in England has been for 
 the government to rely upon and to 
 seek the close cooperation of organ- 
 ized labor. It is well for American 
 business men to have this in mind." 
 
 [26] 
 
V 
 
 Britain Firm— America Hesitating 
 
 It is evident that the British Labor 
 question has received systematic cen- 
 tralized attention. This is, of course, 
 easier to accomplish in Great Britain 
 than in America for several reasons 
 including the following: 
 
 1. Size of country. 
 
 2. Homogeneity of population. 
 
 3. Many national strikes prior to 
 the war resulted in about 10% of the 
 entire population of the British Isles 
 belonging to the Labor Unions which 
 the Government has recognized offi- 
 cially and adopted as the mechanism 
 for dealing with labor. 
 
 4. Having in the British Isles no 
 sovereign bodies corresponding to our 
 State Governments, centralized con- 
 trol was more natural and simple. 
 
 5. No large enemy alien population. 
 
 The very fact that our national con- 
 ditions increase the difficulty of co- 
 ordinating our labor efforts consti- 
 tutes an excellent reason for making 
 more vigorous efforts to do so. All 
 of our Labor Committees are strug- 
 gling valiantly in their individual 
 fields and are also endeavoring to 
 cooperate, but cooperation without 
 aggressive leadership seldom succeeds. 
 The greater the number of co-equal 
 authorities the greater the need for a 
 chief. 
 
 It is difficult to understand how any 
 of these labor committees can do 
 comprehensive work without highly 
 organized statistical and investiga- 
 tional auxiliaries. 
 
 The Department of Labor has been 
 said in the Press to have the follow- 
 ing program: 
 
 (A) To extend to a number of in- 
 dustries having war contracts .the 
 
 system of Wage Adjustment Boards. 
 
 (B) To increase the number of 
 war department contracts containing 
 clauses providing that in case of 
 suspension of work by strikes the 
 Secretary of War shall settle the dis- 
 putes. 
 
 (C) To enforce agreements not to 
 reduce wages. 
 
 (D) To encourage employers to 
 form associations by industry groups. 
 
 (E) To press informally for adjust- 
 ment of disagreements before they 
 reach the strike stage. 
 
 Was the Public Told? 
 
 In August the Department of Labor 
 had no complete record of strikes and 
 its staff of investigators, in spite of 
 increasing recurrence of strikes, was 
 smaller than it had been three months 
 earlier. This was said to be due to 
 lack of appropriations. In other 
 words, the Department chiefly charged 
 with labor knowledge and activity had 
 insufficient funds with which even to 
 list the trouble spots. 
 
 Comparatively recently seven or 
 eight hundred thousand dollars, it is 
 said, have been appropriated by the 
 President from his War Emergency 
 Fund which, together with the Con- 
 gressional appropriation of $250,000, 
 enables the Department of Labor bet- 
 ter to meet for a time its responsibili- 
 ties. But most of the other obstacles 
 still operate — (chiefly lack of concen- 
 trated authority and comprehensive 
 plan). 
 
 It would be interesting but useless 
 to consider how much trouble could 
 have been averted by earlier applica- 
 tion of help from the Emergency 
 Fund. 
 
 [27] 
 
The labor situation is so fraught 
 with political difficulties and other 
 dangers that one can understand 
 the reluctance to take a firm con- 
 structive hold upon it. But unfor- 
 tunately the difficulty is rapidly 
 increasing, so the sooner centralized 
 action is taken the quicker the politi- 
 cal boomerang is likely to be elimi- 
 nated — leaving out of account the ad- 
 vantage to our national plans and 
 safety. In considering our national 
 problems one is not warranted in dat- 
 ing their beginning with our entry 
 into the war because our real problems 
 began in common with the rest of the 
 world in August, 1914. 
 
 Realizing her extreme danger Great 
 Britain from that date has shown a 
 resourcefulnes and an astonishing 
 willingness to step into the unknown, 
 which go far to explain her long 
 existence as a nation. Even while 
 experimenting, however, she is doing 
 things thoroughly. Her accumulation 
 of information bearing upon every 
 important subject, her analyses of 
 past, present, and future are lessons 
 worthy of our careful consideration. 
 The following extracts from the report 
 of her Commission appointed June 
 12th and July 3rd, 1917 to inquire into 
 the Causes of Industrial Unrest may 
 prove of interest: 
 
 "In order that the principal 
 points of agreement and difference 
 between the eight reports may be 
 readily seen, I submit the following 
 brief summary of the Commission- 
 ers' findings and recommendations: 
 
 (1) High food prices in relation 
 to wages, and unequal distribution 
 of food. 
 
 (2) Restriction of personal 
 freedom and, in particular, the 
 effects of the Munitions of War 
 Acts. Workmen have been tied up 
 to particular factories and have 
 
 been unable to obtain wages in re- 
 lation to their skill. In many cases 
 the skilled man's wage is less than 
 the wage of the unskilled. Too 
 much centralization in London is 
 reported. 
 
 (3) Lack of confidence in the 
 Government. — This is due to the 
 surrender of Trade Union customs 
 and the feeling that promises as re- 
 gards their restoration will not be 
 kept. It has been emphasized by 
 the omission to record changes of 
 working conditions under Schedule 
 II, Article 7 of the Munitions of 
 War Act. 
 
 (4) Delay in settlement of dis- 
 putes. — In some instances 10 weeks 
 have elapsed without a settlement, 
 and after a strike has taken place, 
 the matter has been put right 
 within a few days. 
 
 (5) Operation of the Military 
 Service Acts. 
 
 (6) Lack of housing in certain 
 areas. 
 
 (7) Restrictions on liquor. — 
 This is marked in some areas. 
 
 (8) Industrial fatigue. 
 
 (9) Lack of proper organiza- 
 tion amongst the Unions. 
 
 (10) Lack of communal sense. — 
 This is noticeable in South Wales, 
 where there has been a break-away 
 from faith in Parliamentary repre- 
 sentation. 
 
 (11) Inconsiderate treatment of 
 women, whose wages are sometimes 
 as low as 13s. 
 
 (12) Delay in granting pensions 
 to soldiers, especially those in Class 
 "W" Reserve. 
 
 (13) Raising of the limit of In- 
 come Tax Exemption. 
 
 (14) The Workmen's Compensa- 
 tion Act. — The maximum of £1 
 weekly is now inadequate." 
 
 [28] 
 
So intent is Great Britain upon fac- 
 ing the future intelligently and brave- 
 ly that the man who is largely cred- 
 ited with that great achievement of 
 building up the Ministry of Munitions, 
 Dr. Christopher Addison, has been 
 appointed Minister of Reconstruction 
 and he is already actively at work on 
 the problems of the future. A report 
 of one of his sub-committees charged 
 with improving relations between em- 
 ployers and employed contains some 
 suggestive paragraphs: 
 
 "1. The terms of reference to the 
 Sub-Committee are: — 
 
 "(1) To make and consider 
 suggestions for securing a per- 
 manent improvement in the re- 
 lations between employers and 
 workmen. 
 
 "(2) To recommend means for 
 securing that industrial condi- 
 tions affecting the relations be- 
 tween employers and workmen 
 shall be systematically reviewed 
 by those concerned, with a view 
 to improving conditions in the 
 future." 
 
 2. After a general consideration 
 of our duties in relation to the mat- 
 ters referred to us, we decided first 
 to address ourselves to the problem 
 of establishing permanently im- 
 proved relations between employers 
 and employed in the main indus- 
 tries of the country in which there 
 exist representative organizations 
 on both sides. The present report 
 accordingly deals more especially 
 with these trades. We are proceed- 
 ing with the consideration of the 
 problems connected with the indus- 
 tries which are less well organized. 
 
 3. We appreciate that under the 
 pressure of the war both employers 
 and work-people and their organi- 
 zations are very much preoccupied, 
 but, notwithstanding, we believe it 
 
 to be of the highest importance that 
 our proposals should be put before 
 those concerned without delay, so 
 that employers and employed may 
 meet in the near future and discuss 
 the problems before them. 
 
 4. The circumstances of the pres- 
 ent time are admitted on all sides 
 to offer a great! opportunity for 
 securing a permanent improvement 
 in the relations between employers 
 and employed, while failure to util- 
 ize the opportunity may involve the 
 nation in grave industrial difficul- 
 ties at the end of the war. 
 
 It is generally allowed that the 
 war almost enforced some recon- 
 struction of industry, and in con- 
 sidering the subjects referred to 
 us we have kept in view the need 
 for securing in the development of 
 reconstruction the largest possible 
 measure of cooperation between 
 employers and employed. 
 
 In the interests of the community 
 it is vital that after the war the 
 cooperation of all classes, estab- 
 lished during the war, should con- 
 tinue, and more especially with 
 regard to the relations between em- 
 ployers and employed. For secur- 
 ing improvement in the latter, it is 
 essential that any proposals put 
 forward should offer to workpeople 
 the means of attaining improved 
 conditions of employment and a 
 higher standard of comfort gener- 
 ally, and involve the enlistment of 
 their active and continuous cooper- 
 ation in the promotion of industry. 
 
 To this end, the establishment for 
 each industry of an organization, 
 representative of employers and 
 workpeople, to have as its object 
 the regular consideration of mat- 
 ters affecting the progress and well- 
 being of the trade from the point 
 of view of all those engaged in it, 
 so far as this is consistent with the 
 
 [29] 
 
general interest of the community, 
 appears to us necessary. 
 
 5. Many complicated problems 
 have arisen during the war which 
 have a bearing both on employers 
 and workpeople, and may affect the 
 relations between them. It is clear 
 that industrial conditions will need 
 careful handling if grave difficul- 
 ties and strained relations are to be 
 avoided after the war has ended. 
 The precise nature of the problems 
 to be faced naturally varies from 
 industry to industry, and even from 
 branch to branch within the same 
 industry. Their treatment con- 
 sequently will need an intimate 
 knowledge of the facts and circum- 
 stances of each trade, and such 
 knowledge is to be found only 
 among those directly connected 
 with the trade. 
 
 6. With a view to providing 
 means for carrying out the policy 
 outlined above, we recommend that 
 His Majesty's Government should 
 propose without delay to the va- 
 rious associations of employers and 
 employed the formation of Joint 
 Standing Industrial Councils in the 
 several industries, where they do 
 not already exist, composed of 
 representatives of employers and 
 employed, regard being paid to the 
 Various sections of the industry 
 and the various classes of labour 
 engaged." 
 
 The first annual report of the 
 United States Shipping Board issued 
 December 1, 1917 says: 
 
 "The mere placing of contracts 
 and disbursements of funds, how- 
 ever, is a relatively small part of 
 the work of building ships, and 
 tables of ships under contract and 
 estimated expenditures give but an 
 inadequate picture of the Corpo- 
 ration's task. In the last analysis it 
 
 is man-power that builds ships, and 
 the mobilization of a large, com- 
 petent, trained, and willing force 
 of workers for the shipyards of the 
 country has been among the most 
 important of the Corporation's ac- 
 tivities. An Industrial Service De- 
 partment has ben organized to aid 
 in the solution of this problem. 
 
 The problem has been a threefold 
 one — first, getting men; second, 
 keeping men; and, third, fitting 
 men for their respective tasks. 
 
 In procuring men for shipbuild- 
 ing service, the Corporation has 
 had the cooperation of the Depart- 
 ment of Labor in assisting ship- 
 building officials as to ways of get- 
 ting in touch with sources of labor 
 supply and in the intelligent use of 
 state and federal employment of- 
 fices. A large development of this 
 work will shortly take place, when 
 the Department of Labor in co- 
 operation with the Corporation, 
 shall have established shipbuilding 
 recruiting centers. 
 
 The retention by shipbuilders of 
 men at their plants has involved a 
 careful study of the problem of 
 "hiring and firing." It has been 
 found that yards employ from two 
 to six men for each job during the 
 course of a year, with obvious 
 losses in efficiency and waste of 
 effort. A weekly man-power audit 
 of each shipyard is now being con- 
 ducted by the Industrial Service 
 Department, which has been of 
 great assistance to shipbuilders in 
 eliminating wasteful practices, and 
 in setting up new standards of em- 
 ployment. 
 
 With the cooperation of the heads 
 of the international labor unions, 
 a far-reaching scheme of industrial 
 education has been put in opera- 
 tion. An instructor training center 
 has been established at Newport 
 
 [so ; 
 
News, to which from 75 to 150 
 skilled mechanics are to be dele- 
 gated by selected yards for a six- 
 weeks' course, to learn how to im- 
 part a knowledge of their trades 
 to recruits in the shipyards. In 
 the course of six months the gradu- 
 ates of this training center, and of 
 such others as may be established, 
 will be in a position to initiate 
 75,000 new workers, mostly from 
 kindred trades, in shipyard employ- 
 ment. 
 
 The housing of the new workmen 
 brought into the shipbuilding work, 
 especially in connection with newly 
 established yards, has presented a 
 serious problem, and plans are 
 under consideration to meet it in 
 a comprehensive way." 
 
 It is the belief of many well-in- 
 formed investigators that the cooper- 
 ation, necessary to meet the demands 
 for shipbuilding labor alone with 
 adequate speed, cannot be obtained 
 under present conditions. Various la- 
 bor committees are rushing about the 
 country to perform their functions 
 without previous division of territory 
 or adequate plans to prevent confu- 
 sion, overlapping and competition. 
 Even were this not true the shipbuild- 
 ing labor cannot be obtained and kept 
 satisfied without elimination of com- 
 petitive bidding on the part of Gov- 
 ernment and private organizations; 
 and in fact, the rates of pay for each 
 class of worker in all the important 
 war activities must be coordinated in 
 the various districts in order to 
 achieve any stability of employment 
 and prevention of the unrest now 
 everywhere apparent. 
 
 Public Opinion Helps 
 
 The Merchants' Association of New 
 York, with a patriotic zeal and initi- 
 ative which is setting a wholesome 
 
 example to other cities and also to 
 our Federal Government, has ap- 
 pointed a special Advisory War Ship- 
 ping Committee. 
 
 This Committee concludes: 
 
 Transportation Facilities Needed 
 
 "Most of the shipbuilding yards 
 in this vicinity have given a detailed 
 account of their problems to the 
 Committee. A tabulation of the 
 problems of the various yards shows 
 that the problem most frequently 
 confronting the shipbuilders is that 
 of obtaining additional and im- 
 proved transportation facilities. 
 
 The second most important prob- 
 lem is that of providing additional 
 housing facilities. 
 
 An inadequate labor supply is 
 also a vital problem at the present 
 time. 
 
 Some yards are prevented from 
 reaching maximum efficiency by the 
 delay and difficulty in getting tools 
 and accessory parts for ships. 
 
 Other problems which shipbuild- 
 ers report as serious are the diffi- 
 culty of preventing the shifting of 
 labor from yard to yard, long de- 
 lays by Exemption Boards in de- 
 ciding industrial claims to ship- 
 building employees, lack of realiza- 
 tion on the part of labor and the 
 public of the importance of building 
 ships, and the necessity of a larger 
 supply of shipworkers with special 
 skill. 
 
 The Housing Situation 
 
 The reason for the decision of the 
 Committee to exert immediate ef- 
 forts to improve the housing situ- 
 ation can be seen by a study of the 
 most important problems reported. 
 
 The problems of providing addi- 
 tional housing facilities, of improv- 
 ing transportation facilities and of 
 
 [31] 
 
obtaining a greater supply of labor 
 are practically one problem, inas- 
 much as the difficulty of obtaining 
 labor is in many cases due almost 
 entirely to lack of housing and 
 transportation facilities. One ship- 
 builder states that his one great 
 problem is to get 2,000 workmen, 
 but he thinks this problem could 
 easily be solved if he could provide 
 housing accommodations for them. 
 The immense amount of capital 
 which shipbuilders have had to put 
 into plant enlargement absolutely 
 prevents most of them from invest- 
 ing in houses. On the other hand, 
 private builders will not construct 
 houses enough because of the high 
 cost of materials, scarcity of work- 
 men and future uncertainty. The 
 Liberty Loans have taken much of 
 the investors' money which might 
 otherwise be loaned to builders of 
 houses. Shipbuilders are practi- 
 cally unanimous in stating that the 
 Government must finance the build- 
 ing of workmen's houses if the re- 
 quired ships are to be produced. 
 There are indications that the Gov- 
 ernment has already given careful 
 attention to this matter." 
 
 A bulletin issued last Fall by the 
 Patriotic Education Society cited the 
 following specific cases as illustrating 
 conditions which were threatening the 
 Shipping Board's building program: 
 
 "1. The output of ships from the 
 yards of the Newport News Dry 
 Dock and Shipbuilding Company, 
 our largest shipyard, is only about 
 50% of what it should be, owing to 
 the unintelligent handling of the 
 labor housing question. The com- 
 pany has asked the Government to 
 appropriate $1,000,000 to $2,000,000 
 for workingmen's houses to be built 
 on land provided by the company. 
 The Emergency Fleet Corporation 
 
 offers to build the houses, but insists 
 upon securing a mortgage on the 
 company's plant. On the other hand, 
 the company argues that the houses 
 will be a dead loss after the war, and 
 that the Government should stand 
 this loss by accepting a mortgage on 
 the houses. 
 
 While the Argument Progresses, 
 Ships Are Not Being Built! 
 
 2. The spirit of trade and barter 
 has held up work on the Govern- 
 ment-owned yards and continues to 
 make for delay. Contracts for 
 building and operating the yards at 
 Hog Island, Pa., at Port Newark and 
 at Bristol Point, were drawn up by 
 General Goethals. They were not 
 signed for four months, while the 
 Government and the private corpo- 
 rations bickered over price. 
 
 Saving Dollars but Losing 
 Ships' Tonnage! 
 
 3. The contract for building the 
 yard at Port Newark and operating 
 it under Government supervision, 
 upon completion, was awarded the 
 Submarine Boat Company. This 
 company was organized by the same 
 men who built submarine chasers 
 for the British in record time. In 
 order to launch the new ships, it is 
 necessary to dredge 3,000,000 cubic 
 yards of soft mud to the channel of 
 Newark Bay. An experienced dredg- 
 ing concern, called in by the Govern- 
 ment, advised that 12 feet was the 
 minimum depth in which to launch 
 a ship at mean low water. Again 
 the question of cost was allowed to 
 intervene. Instructions were given 
 to a Newark engineer to prepare 
 plans for dredging to a depth of 7% 
 feet, although 7^ feet would not 
 give sufficient water for launching. 
 A glance at a tide chart would have 
 
 [32] 
 
shown the Emergency Fleet Corpo- 
 ration the absurdity of its position. 
 The controversy is as yet unsettled, 
 although it is proposed to work a 
 single Government dredge, said to 
 be entirely inadequate to dredge the 
 harbor before the freezing weather 
 sets in. The Submarine Boat Com- 
 pany expected to lay the keel for its 
 first ship in February and to be able, 
 upon completion of the first hull, to 
 launch two boats a month there- 
 after. It is doubtful if the first 
 keel can be laid before July. 
 
 This Is Not Winning the War! 
 
 4. Labor is the all-important 
 question in building ships, but the 
 sites for the Government yards have 
 been selected without considering 
 this question. There is no possibil- 
 ity for housing the workers on the 
 ground, but they have to be trans- 
 ported a distance. In one instance 
 the Government yard has been lo- 
 cated upon an open sewage canal. 
 Probably the entire national labor 
 problem will have to head up to a 
 labor dictator before the shipbuild- 
 ing problem can be satisfactorily 
 met. 
 
 This Is Not Encouraging Labor 
 to Build Ships! 
 
 5. Three hundred hulls are being 
 built in Atlantic and Gulf shipyards. 
 Weeks went by before it seemed to 
 be recognized that hulls could not 
 cross the Atlantic without engines. 
 Then the Emergency Fleet Corpora- 
 tion resorted to hoary precedent, 
 advertising for bids for installing 
 the engines, although the country's 
 capacity, under existing conditions, 
 was filled." 
 
 The New Republic for November 17, 
 1917, demands a national labor policy 
 and presents several constructive 
 
 thoughts in relation thereto, some of 
 which are quoted below: 
 
 A National Labor Policy 
 
 In the absence of a national pol- 
 icy, responsibility for labor negotia- 
 tions has become widely scattered 
 and no semblance of a uniform point 
 of view is discoverable. The Labor 
 Sub-Committee of the Council of 
 National Defense, the Interdepart- 
 ment Committee, the National La- 
 bor Adjustment Commission, the 
 Shipyard Labor Board, the Labor 
 Commission, which recently left for 
 the West, the Board of Control on 
 army garments — these specially 
 created agencies are all primarily 
 engaged in adjusting the demands 
 of labor for the War and Navy De- 
 partments, for some contract shops 
 and for a relatively few sub-con- 
 tracting establishments. The re- 
 maining government departments 
 deal with their employees along lines 
 of their own choosing. The great 
 mining, transportation and manu- 
 facturing plants which have no di- 
 rect government contracts either 
 negotiate with labor on some previ- 
 ously agreed basis of which the an- 
 thracite coal agreement is an in- 
 stance; or they have no considered 
 basis at all as in the case of the 
 steel industry. 
 
 The confusion created by this di- 
 versity of agencies and lack of 
 agencies is grossly uneconomical. 
 Production executives confronted 
 with the insistent claims of labor 
 are bewildered to the point of dis- 
 traction. Although admittedly out- 
 side the field in which they are ex- 
 pert, managers are being forced to 
 turn their entire attention to hu- 
 man problems in order that the 
 wheels may be kept moving. This 
 is unfortunate not only because 
 
 [33; 
 
expensive technical executives are 
 diverted from their specialties, but 
 because they must attend to labor 
 problems which for successful solu- 
 tion require a quality of mind pecu- 
 liarly adapted and trained. 
 
 It happens also, in the absence of 
 a uniform policy, that when two 
 or three departments let contracts 
 to one corporation the same group 
 of employees must be dealt with un- 
 der the two or three disparate sets 
 of terms of the respective depart- 
 ments — a state of affairs not calcu- 
 lated to reassure workers that 
 wisdom, economy and justice are 
 determining the treatment which is 
 accorded them. 
 
 But the existing confusion is not 
 without its hopeful phases. Ele- 
 ments of sound policy are to be 
 found, here a little and there a lit- 
 tle; and an effort to group into one 
 effective platform on national in- 
 dustrial relations the best features 
 of the several existing methods of 
 handling the human factor should 
 result in a policy which would leave 
 little to be desired. Immediate 
 consideration of these successful 
 methods and of the principles which 
 underlie them is essential, if the 
 policy is to have practical value in 
 the present crisis. 
 
 There is, first, the principle of 
 representation which requires par- 
 ticipation of all interests in deliber- 
 ations which affect them. Several 
 of the new agencies have from the 
 start acted upon this basis. The 
 Adjustment Committee of nine, for 
 example, includes three employers, 
 three representatives of workers 
 and three of the public. But there 
 is a necessary corollary to this prin- 
 ciple, which has also to be recog- 
 nized; namely, representation not 
 only by interests in general but by 
 immediately involved interest in 
 
 particular. On the shipbuilding la- 
 bor board, notably, the representa- 
 tion is more satisfactory because 
 all parties are chosen from the plant 
 in which the dispute has arisen. Of 
 equal importance today with a jury 
 of peers is a jury composed at least 
 in part of those versed in the tech- 
 nique around which the controversy 
 centers. 
 
 The second principle, also implied 
 in the first, requires the existence 
 of a collective agreement in which 
 certain of the terms of employment 
 are definitely set forth, and certain 
 guaranties mutually afforded. This 
 sensibly puts negotiations on a 
 footing of equal bargaining power, 
 and it stabilizes employment for the 
 laborer and costs for the manager. 
 The federal government has en- 
 tered into a collective agreement 
 with the representatives of the sev- 
 eral trades necessary to shipbuild- 
 ing and has by so doing admitted 
 the practical utility of collective 
 contractual relations. 
 
 There is, again, implicit in the 
 collective bargain the acceptance of 
 union standards of employment. 
 Perhaps no element in a national 
 labor policy is at the moment more 
 important than this. The union 
 standards of pay, although they 
 vary from place to place and from 
 trade to trade, are standards that 
 represent a momentary equilibrium 
 between the downward pressure of 
 employers and the upward thrust 
 of organized workers. Union 
 standards represent the least that 
 the workers feel they can safely ac- 
 cept if they are to maintain their 
 status as fathers and citizens. In 
 a day of fluctuating living costs 
 when practical working standards 
 of pay must be achieved, the union 
 scale with all its shortcomings 
 stands as the best available. 
 
 [34] 
 
The initial formulation of na- 
 tional policy would, therefore, in- 
 clude the requirement of collective 
 bargaining, with expert representa- 
 tive deliberation on all problems 
 where the interests of the workers 
 are affected, and the acceptance of 
 union standards of pay, hours and 
 working conditions as the minimum 
 below which no work would be car- 
 ried on. So much would be only a 
 correlation and uniform adoption 
 of already familiar practices. But 
 this is not enough. It is never suf- 
 ficient to agree that certain terms 
 will become operative without mak- 
 ing provisions for their enforce- 
 ment. Moreover it is never suf- 
 ficient — and in war time approaches 
 fatal negligence — to provide only 
 for settlement of grievances after 
 they have become acute. The de- 
 mand for prevention must lead us 
 to provide in our policy for a na- 
 tional instrument of permanent in- 
 quiry and report on the causes of 
 discontent both before and after the 
 strike stage is reached. The com- 
 mission which is now investigating 
 in the West is not at present in- 
 tended to fulfil this function; nor 
 has the small staff of the Depart- 
 ment of Labor been commandeered 
 to meet more than a tiny fraction 
 of this need. The requirements of 
 the situation make necessary a new 
 body with new duties, powers and 
 resources. 
 
 A National Bureau of Industrial 
 Relations is needed. It should have 
 for its province (1) to know all the 
 places where government work is 
 being done; (2) to know in as great 
 detail as possible the terms and con- 
 ditions under which that work is 
 being undertaken in order to be 
 able to enforce existing agreements ; 
 (3) to ferret out and try to adjust 
 at once all complaints arising in the 
 
 shops; (4) to investigate and re- 
 port to the several existing adjust- 
 ment boards the facts of pending 
 controversies which the Bureau it- 
 self is unable to settle. The uni- 
 form method of exhaustive re- 
 port and the publicity of con- 
 ditions which have resulted so 
 beneficially in the finances of 
 our railroads in the last decade of 
 the Interstate Commerce Commis- 
 sion's activity, are now imperative 
 in the labor affairs of all corpora- 
 tions performing the public service 
 of war production, and in the labor 
 affairs of the government shops 
 themselves. We need a national 
 fact-finding body as trained and 
 discriminating in the labor field as 
 the Interstate Commerce Commis- 
 sion is in its own domain. Without 
 in any way dislocating the judicial 
 functions of all existing boards 
 it would be possible greatly to 
 strengthen their hands by giving 
 over to one competently conducted 
 agency the work of discovering vio- 
 lations of agreements already in 
 force, of finding the reasons for 
 pending troubles, and of laying bare 
 before the fact, causes of potential 
 disturbance. 
 
 This National Bureau, conducted 
 with honestly progressive purposes, 
 would indeed be the safety valve 
 through which much pent-up dis- 
 trust, ill-will and rankling bitter- 
 ness could be innocuously released; 
 and its work would be the surest 
 guaranty that new difficulties would 
 be kept at a minimum. Operating 
 on a basis of the national policy we 
 have suggested, this agency would 
 give the working class a new sense 
 of the government's awareness, of 
 its sympathy with and understand- 
 ing of their needs, of its desire to 
 be an active partner in the enter- 
 prise of making industry safe for 
 
 [35] 
 
a democracy. It could, in fine, be 
 the articulate working mind, think- 
 ing and planning to see that, in the 
 conduct of the war, labor was being 
 reckoned with considerately, affirm- 
 atively and with a prophetic sense 
 of the more secure and responsible 
 place which the worker is destined 
 to occupy in the post-war economy. 
 The expense incident to the ef- 
 fective functioning of this Bureau 
 would undoubtedly be large, but in 
 view of the savings it Would effect 
 the net cost would be negligible. 
 Moreover the closest working co- 
 operation should be established 
 with the Department of Labor to 
 the end that its trained investiga- 
 tors and its existing machinery be 
 so far as possible put at the Bu- 
 reau's disposal. And the manifold 
 committees created under the Coun- 
 cil of National Defense and other 
 bodies, to whom aspects of the labor 
 
 problem have already been en- 
 trusted, would unquestionably find 
 their maximum usefulness under 
 the immediate guidance of this ac- 
 credited and responsible agency. 
 But in any case the element of cost 
 must be completely subordinated to 
 the larger ends in view. 
 
 The task of integrating our gov- 
 ernmental war machinery is already 
 well under way. The next step im- 
 peratively called for is the creation 
 of one authoritative, unified body 
 committed to the definition and pro- 
 mulgation of a liberal national labor 
 policy and to widespread and im- 
 partial investigation of the sources 
 of unrest. Controlled by this pol- 
 icy and guided by the truly relevant 
 facts which such investigation 
 would disclose, our war industries 
 will achieve a productivity and a 
 harmony to be secured in no other 
 way." 
 
 [36] 
 
VI 
 
 Capital and Labor Have Locked Horns 
 
 Labor Dictator Needed 
 
 We doubt whether the labor pro- 
 gram can be solved through the old- 
 established peace-time channels any 
 more successfully than the present 
 Congressional investigation indicates 
 that the War Department can well 
 conduct purchasing and manufactur- 
 ing business on a national scale. 
 
 Illustrating the futility of existing 
 methods, a San Francisco editor un- 
 der date of December 26th, 1917, 
 writes : 
 
 "In November the Labor Adjust- 
 ment Board, presided over by Sec- 
 retary of Labor Wilson, adjusted 
 the wage disputes in the metal 
 trades on the Pacific Coast by 
 granting a minimum base wage of 
 $5.25 a day of eight hours, as 
 against a maximum wage of $4.80 
 in the same trades on the Atlantic 
 Coast. Having done this, the Fed- 
 eral officials went home. They were 
 followed immediately by a commit- 
 tee of ironworkers. In Washing- 
 ton the subject was reopened, while 
 the employers were not present, 
 and without consulting the employ- 
 ers the Federal officials granted the 
 ironworkers an increase of 10% 
 over and above the wage scale fixed 
 in conference. This increase was 
 to apply only to the shipyard work- 
 ers. As a result of this action, 
 15,000 workers in the metal trades 
 not engaged in shipyard work, but 
 manufacturing tractors, airplane 
 motors and other war materials are 
 striking today." 
 
 The peace-time bureaucratic ma- 
 chine has too rigid delimitation- of 
 powers and privileges, too many checks 
 
 against making mistakes to permit of 
 rapid expansion of activity without at 
 the same time developing an over- 
 whelming opposition of jealousy and 
 red tape. For that reason the question 
 arises whether a Labor Dictator or 
 Administrator, responsible directly to 
 the President, free from affiliations 
 which would arouse unnecessary an- 
 tagonism from employer or employee, 
 a man in whom the great American 
 public would have confidence as to his 
 justice, integrity and ability, one 
 whose courage would prove equal to 
 presenting the real facts for the deci- 
 sion of the public regardless of in- 
 fluence by either capital or any labor 
 groups, may not be vitally necessary 
 as a war mechanism. 
 
 Capital and organized labor have to- 
 day virtually "locked horns" and view 
 each other with increasing distrust. 
 For this reason the public and the 
 Government must take matters into 
 their own hands. 
 
 The Chamber of Commerce of the 
 United States, through its Committee 
 on Cooperation, with the Council of 
 National Defense, outlines the attitude 
 of our Government toward labor in its 
 war bulletin No. 15 issued August 
 24th, 1917, as follows: 
 
 Our Government and 
 Labor 
 
 Department of Labor 
 
 "The point of contact between our 
 government and labor problems 
 is the Department of Labor. When 
 the President, Secretary of War, or 
 other member of the Administra- 
 tion desires information or advice 
 
 [37] 
 
with regard to some labor problem, 
 reliance is had upon the Secretary 
 of Labor. Consequently there should 
 be widespread knowledge of the 
 Secretary's official statement con- 
 cerning his general position regard- 
 ing labor activities during the war 
 and controversies between employ- 
 ers and employees during this time. 
 
 Existing Standards 
 
 First, it may be said that on 
 April 7, 1917, the Council of 
 National Defense adopted a reso- 
 lution submitted by the Executive 
 Committee of the Committee on La- 
 bor of the Council of National De- 
 fense, including the following: 
 
 "That the Council of National De- 
 fense will issue a statement to employ- 
 ers and employees in our industrial 
 plants and transportation systems ad- 
 vising that neither employers nor em- 
 ployees shall endeavor to take advan- 
 tage of the country's necessities to 
 change existing standards. When eco- 
 nomic or other emergencies arise re- 
 quiring changes of standards, the same 
 shall be made only after such proposed 
 changes have been investigated and 
 approved by the Council of National 
 Defense." 
 
 No Advantage 
 of Abnormal Conditions 
 
 The Secretary of Labor is, of 
 
 course, a member of the Council of 
 
 National Defense and on April 23, 
 
 1917, speaking for the Council, he 
 
 said with reference to the above 
 
 resolution : 
 
 "The Council of National Defense 
 takes this position, that the standards 
 that have been established by law, by 
 mutual agreement, or by custom should 
 not be changed at this time; that where 
 either an employer or an employee has 
 been unable under normal conditions 
 to change the standards to their own 
 liking, they should not take advantage 
 of the present abnormal conditions to 
 establish new standards." 
 
 He also said: 
 "That employers and employees in 
 
 private industries should not attempt 
 to take advantage of the existing ab- 
 normal conditions to change the stand- 
 ards which they were unable to change 
 under normal conditions." 
 
 Hours of Labor 
 
 The Secretary mentioned the 
 hours of labor as among the stand- 
 ards referred to and pointed out 
 that by custom certain standards 
 constituting a day's work had been 
 established varying from seven 
 hours per day in some kinds of 
 office work to 12 hours per day in 
 continuous-operation plants. 
 
 Organization of Unions 
 
 With regard to the organization 
 of unions, the Secretary said that, 
 speaking solely for himself, his atti- 
 tude was that 
 
 "Capital has no right to interfere 
 with workingmen organizing labor any 
 more than the workingman has a right 
 to interefere with the capitalists organ- 
 izing capital. The two are on a parity 
 on that point, and so my feeling is that 
 in the present emergency the employer 
 has no right to interfere with you in 
 your efforts to organize the workers 
 into unions, just as you have no right 
 to interfere with capitalists organizing 
 capital into corporations. If you can 
 get a condition where efforts to organ- 
 ize the workers are not interfered with, 
 and where a scale of wages is recog- 
 nized that maintains the present stand- 
 ard of living, it occurs to me that for 
 the time being no stoppage of work 
 should take place for the purpose of 
 forcing recognition of the union." 
 
 Government's Policy 
 
 The above statements should be 
 carefully studied by all busines men 
 as they represent the declared 
 policy of the goverment with regard 
 to labor matters in connection with 
 the war. 
 
 There is no doubt that many per- 
 sons in the government today be- 
 lieve that it is important in con- 
 nection with the prosecution of the 
 war that labor should become 
 
 [38] 
 
organized and be dealt with by the 
 employer and the government 
 through these organizations. 
 
 British Policy 
 
 The message brought to this 
 country by James Thomas and 
 Charles W. Bowerman, who were 
 sent over from England by Lloyd 
 George to advise this country as to 
 what had been done in England in 
 connection with labor problems, 
 was that the English government 
 throughout the war had recognized 
 the importance of dealing with la- 
 bor through labor organizations, 
 having encouraged the further or- 
 ganization of labor and dealt with 
 organized labor on all problems 
 which affect labor. In England la- 
 bor has been largely unionized for 
 some years. 
 
 American Conditions 
 On the other hand many persons 
 here emphasize that conditions in 
 this country are essentially dif- 
 ferent from those in England, and 
 that in this instance, as in others, 
 English experience will be most 
 helpful to us if used with discre- 
 tion. 
 
 All agree that industrial peace 
 should be promoted during these 
 times of concentrated national en- 
 ergy. As indicated above, the 
 spokesman for the government has 
 taken the position that industrial 
 peace will be promoted by continu- 
 ing the status existing when the 
 war began so far as standards of 
 hours and recognition of the union 
 are concerned. But the Secretary 
 of Labor has expressed his personal 
 opinion that the peaceful organiza- 
 tion of unions may go on." 
 
 The nearest approach in this coun- 
 try to a sociological research labora- 
 
 tory is the National Industrial Con- 
 ference Board which was organized 
 to obtain facts relating to and present 
 conclusions bearing upon important 
 sociological problems. Under date of 
 September 6th this Board presented 
 the following report: 
 
 "The Council of National Defense: 
 Gentlemen : 
 
 Some months ago, at the sugges- 
 tion of Mr. Howard Coffin, a com- 
 mittee of five was appointed by the 
 National Industrial Conference 
 Board to advise with him in mat- 
 ters relating to the economics of 
 industry, which committee has been 
 officially designated the Advisory 
 Committee of the National Indus- 
 trial Conference Board. At his 
 suggestion we are here to present 
 certain statements and recommen- 
 dations regarding the relations of 
 employer and employee and the ad- 
 justment of possible differences, 
 during the period of the war. 
 
 The National Industrial Confer- 
 ence Board is a cooperative and ad- 
 visory body of representative man- 
 ufacturers constituted through the 
 selection of two members by and 
 from each of the following National 
 Associations : 
 
 American Cotton Manufacturers' Asso- 
 ciation. 
 
 American Paper and Pulp Association. 
 
 Electrical Manufacturers' Club 
 
 Manufacturing- Chemists' Association of 
 the United States. 
 
 National Association of Cotton Manufac- 
 turcrs 
 
 National Association of Manufacturers. 
 
 National Association of Wool Manufac- 
 t u r g r s 
 
 National Automobile Chamber of Com- 
 nicrcG. 
 
 National Boot and Shoe Manufacturers' 
 Association. 
 
 National Council for Industrial Defense. 
 
 National Erectors' Association. 
 
 National Founders' Association. 
 
 National Implement and Vehicle Manu- 
 facturers' Association. 
 
 National Metal Trades Association. 
 
 Rubber Association of America, Inc. 
 
 Silk Association of America. 
 
 United Typothetae and Franklin Clubs of 
 America. 
 
 In order that the statements and 
 
 [39] 
 
recommendations which the Com- 
 mittee here makes may be truly 
 representative of industrial opinion, 
 we have called to our counsel the 
 executive heads of the foregoing 
 seventeen national associations 
 comprising in their membership 
 more than eighteen thousand manu- 
 facturers, representatives of a ma- 
 jority of state associations of man- 
 ufacturers, and, in addition, a 
 large number of executive officers 
 of industrial organizations engaged 
 either directly or indirectly on the 
 production of war essentials. These 
 statements and recommendations 
 express the unanimous opinion of 
 this large body of representative 
 manufacturers. 
 
 In approaching a discussion of 
 the relation of employer and em- 
 ployee at this critical hour, we be- 
 lieve we are animated by a spirit 
 worthy of the time and place and 
 the gravity of the circumstances, 
 which makes an equitable and har- 
 monious adjustment of employment 
 relations a matter of national 
 necessity. 
 
 The Council of National Defense 
 has deemed this subject of such 
 consequence that it created a Com- 
 mittee on Labor, substantially di- 
 rected and controlled by represen- 
 tatives of the largest national 
 unions which, after due delibera- 
 tion, issued through its executive 
 committee a statement apparently 
 intended to declare certain funda- 
 mental policies of industrial rela- 
 tionship which should apply during 
 the period of the war. Perhaps the 
 most important sentence of this 
 statement was the declaration that 
 "neither employers nor employees 
 shall endeavor to take advantage of 
 the country's necessities to change 
 existing standards." Differences 
 of interpretation and opinion led 
 
 to a further amplification and ex- 
 planation and accompanying dec- 
 larations, which were endorsed by 
 the Council of National Defense. 
 
 These were to the effect, that 
 standards of safety and service 
 established by the State or Federal 
 law should remain in effect unless 
 and until, under the exigencies of 
 war, the Council of National De- 
 fense, after proper investigation, 
 should recommend some modifica- 
 tion as essential to the national 
 safety. It was likewise urged that, 
 inasmuch as the standard of living 
 was particularly dependent upon 
 the purchasing power of wages, no 
 arbitrary wage change should be 
 sought through the medium of 
 strikes or lockouts by employer 
 or employee without affording 
 the established State or Federal 
 mediums of arbitration or con- 
 ciliation an opportunity to adjust 
 disputes without stopping pro- 
 duction, and it was especially 
 urged that "employers and em- 
 ployees in private industries should 
 not attempt to take advantage of 
 the existing abnormal conditions to 
 change the standards which they 
 were unable to change under nor- 
 mal conditions. 
 
 Despite these timely admoni- 
 tions, we find ourselves entering the 
 fifth month of war faced with un- 
 precedented demands for war pro- 
 duction, seriously interrupted and 
 delayed by numerous strikes and 
 threats of strikes in every part of 
 the country, some of which are 
 likely to assume the proportions of 
 a national interruption of essential 
 service in our factories and ship- 
 yards. 
 
 Let it be clearly understood that 
 we, without equivocation, endorse 
 the maintenance of every neces- 
 sary regulation for safety and 
 
 [40] 
 
health and the fair adjustment of 
 wages in accordance with the 
 American standard of living and 
 the increasing cost of its main- 
 tenance. So far as we know, the 
 American manufacturer can and 
 will pay any advance in wages 
 which expresses corresponding la- 
 bor efficiency. Hours of labor have 
 been universally contracting under 
 the influence of many causes, the 
 chief of which has been the always 
 increasing development of labor- 
 saving machinery constantly multi- 
 plying the producing power of hu- 
 man effort. We enter the war with 
 the average hours of labor in 
 American manufacture, as shown 
 by the Government Manufacturers 
 census of 1914, very considerably 
 less than the average hours of la- 
 bor recommended for either sex in 
 British industry in the Reports of 
 the Health of Munition Workers 
 Committee to the Minister of Muni- 
 tions during 1916. 
 
 We also submit that the Naval 
 Consulting Board, reporting upon 
 its preliminary investigation of 
 manufacturing establishments cap- 
 able of munition work, found the 
 total number to be 18,654, and that 
 of these 16,787, or 89% were 
 "open" shops. Of 1,950 establish- 
 ments usable for the manufacture 
 of ammunition powder and explo- 
 sives, guns and gun material, gun 
 carriages, limbers and accessories, 
 personal military equipment, tools, 
 gauges and punches, machine tools 
 and aeroplanes, all but 73 are 
 "open" shops. (Senate Document 
 No. 664, 64th Congress, 2nd Ses- 
 sion, page 40.) 
 
 With respect to wages, a great 
 body of munition production for the 
 Government proceeds under a con- 
 tract wage law, assuring at least 
 time and a half for all overtime in 
 
 excess of eight hours, so that for 
 like tasks industrial wages for war 
 work are universally increased by 
 the operation of statute in every 
 plant whose contracts come within 
 its scope. Antecedent to our en- 
 trance into the war general wage 
 increases in large amounts had been 
 voluntarily given throughout the 
 generally prosperous industries, so 
 that it may be fairly said that our 
 wage scale on the average was, ac- 
 tually as well as nominally, greatly 
 superior to that of any belligerent 
 country. But despite this condition 
 and the increase by statute of 
 wages for the subject matter of our 
 own war production, it is inevitable 
 that wage differences will continue 
 to arise. The vital thing is that 
 such disputes shall be adjusted 
 without interruption of production 
 necessary to national defense. To 
 this end we believe that manufac- 
 turers are ready and anxious to co- 
 operate in the establishment of a 
 representative and equitable system 
 of adjustment, for the period of 
 the war. 
 
 There are, however, other "stand- 
 ards" of employment than those 
 relating to hours and wages which 
 are of critical importance not mere- 
 ly to efficient production but to the 
 institutions of a free people. 
 Strikes are threatened and are oc- 
 curring in increasing numbers to 
 compel the exclusive employment 
 of union men. This, we empha- 
 tically urge, is contrary to any fair 
 interpretation of the spirit and 
 letter of the fundamental policy 
 declared by the Council "that em- 
 ployers and employees in private in- 
 dustries should not attempt to 
 change the standards which they 
 were unable to change under nor- 
 mal conditions." 
 
 Can there be any doubt that to 
 
 [41] 
 
undertake to open a "closed" shop 
 or close an "open" shop under the 
 exigencies of war is an evident 
 attempt "to change the standard 
 which they were unable to change 
 under normal conditions?" This is 
 the view frankly presented by Mr, 
 Thomas, the English labor repre- 
 sentative, in his suggestions to the 
 Committee on Labor of the Advi- 
 sory Commission of the Council of 
 National Defense, when recom- 
 mending conduct predicated upon 
 his British experience, he declared, 
 according to The American Federa- 
 tionist for August of this year: 
 
 "Let the employer say: 'I am not 
 desirous of taking advantage of the 
 war to break down something that I 
 never believed in.' On the other hand, 
 let the employees say: 'Whilst anxious 
 to maintain the law, we are not anxi- 
 ous to take advantage of the war to 
 enforce something during the war that 
 we could not obtain in peace times.' 
 With both sides recognizing that, I 
 repeat, I believe they will find a solu- 
 tion.' 
 
 Secretary of Labor Wilson ap- 
 parently endorsed this view when 
 on April 23d, 1917, in an explana- 
 tory statement on behalf of the 
 Council he said : "that where either 
 an employer or an employee has 
 been unable under normal condi- 
 tions to change the standards to 
 their own liking, they should not 
 take advantage of the present ab- 
 normal conditions to establish new 
 standards." This, we urge, de- 
 clares a sound policy and a fair 
 interpretation for the Council to 
 place upon its recommendation. 
 
 Moreover there is a labor short- 
 age which will necessarily be inten- 
 sified by withdrawing from indus- 
 try the personnel of its contribu- 
 tion to our armed forces. In this 
 crisis America needs the service of 
 every citizen. We can no more de- 
 pend upon one class to operate our 
 
 factories than to fill the ranks of 
 our armies. Therefore, it is incon- 
 ceivable that the Government can 
 tolerate, much less approve, any 
 proposal which makes membership 
 in a private organization a prereq- 
 uisite to a citizen securing em- 
 ployment in production for the war. 
 All citizens, union or non-union, are 
 equally entitled to, and must receive 
 like consideration from their gov- 
 ernment and equally enjoy the full 
 protection of national authority in 
 every circumstance of daily life. 
 The assertion is untenable that a 
 minority or a majority of em- 
 ployees in any industry by volun- 
 tarily associating themselves into 
 an organization acquire authority 
 or right over the equal liberty of 
 those who do not care to do like- 
 wise. As was said in a great pub- 
 lic document: 
 
 "This all seems too plain for argument. 
 Common sense and common law alike 
 denounce those who interfere with this 
 fundamental right of the citizen. The 
 assertion of the right seems trite and 
 commonplace, but that land is blessed 
 where the maxims of liberty are com- 
 monplaces." 
 
 (Report of Anthracite Coal Strike 
 Commission, 1902.) 
 
 To win this war we can sacrifice 
 everything but the principles of the 
 Republic and the fundamental 
 rights of citizenship it was founded 
 to protect. The right to pursue a 
 lawful calling and to live free from 
 annoyance and molestation is the 
 primary if not the greatest privi- 
 lege which society is founded to 
 sustain. 
 
 The British policy expressed in 
 its Munition Acts is that all labor, 
 whether it be that of the employer 
 or the employee, of men or women, 
 of union of non-union, of the skilled 
 or unskilled, shall be employed to 
 the best advantage of the country. 
 Neither restriction nor discrimina- 
 
 te] 
 
tion, nor, in "controlled shops," 
 strikes or lockouts are permitted. 
 A Ministry of Munitions is success- 
 fully promoting the expeditious 
 output of munitions by employing 
 all the available labor to that end. 
 With due regard to the plant and 
 equipment of each establishment it 
 has successfully subordinated con- 
 flicts between employer and em- 
 ployee to the winning of the war. 
 
 To the same great end we pro- 
 pose through you, in the presence 
 of the public, that employer and 
 employee, organized and unorgan- 
 ized, shall pledge themselves to 
 prevent strikes and lockouts, to 
 deal rationally and unselfishly 
 through a representative tribunal 
 with serious wage disputes, and 
 for the period of the war, not 
 compel or attempt to compel dis- 
 criminations in employment by 
 strikes, threats of strikes or lock- 
 outs. 
 
 We further submit that under 
 the present circumstances of na- 
 tional necessity, it is the duty of 
 both the manufacturer and of or- 
 ganized labor to jointly cooperate 
 with the Government that sedition 
 in any of its manifold forms, 
 whether masquerading in the name 
 of labor or under any other guise, 
 shall be ruthlessly exposed and sup- 
 pressed. 
 
 To epitomize our conclusions and 
 recommendations we urge : 
 
 1. That as a basis of mutual 
 understanding employer and em- 
 ployee recognize and agree that now 
 and for the period of the war con- 
 tinuous, efficient production can 
 alone equip and sustain our mili- 
 tary forces. Every dispute, what- 
 ever its motive, which interrupts 
 production, furthers the ends and 
 operates to the advantage of" the 
 public enemy. 
 
 [43] 
 
 2. The Nation needs the service 
 of every citizen. Its industrial 
 workers are as indispensable to vic- 
 tory as the soldier on the firing 
 line. The non-union man is as 
 necessary in the factory as he is 
 in the army. On economic as well 
 as indisputable moral grounds the 
 Government can, therefore, neither 
 permit nor tolerate the exclusion of 
 any laborer from productive em- 
 ployment. We, therefore, urge the 
 Council to adopt and re-assert as 
 its guiding principle the funda- 
 mental American doctrine authori- 
 tatively stated by the Anthracite 
 Coal Strike Commission with the 
 approval of representatives of both 
 employers and unions included in 
 its membership and commended as 
 the basis of industrial adjustments 
 by Presidents Roosevelt, Taft and 
 Wilson. 
 
 "That no person shall be refused 
 employment or in any way discrimi- 
 nated against on account of member- 
 ship or non-membership in any labor 
 organization; that there shall be no 
 discrimination against, or interference 
 with, any employee who is not a mem- 
 ber of any labor organization by mem- 
 bers of such organization." 
 
 3. The Council's reiterated re- 
 commendation that 
 
 employers and employees in private 
 industries should not attempt to take 
 advantage of the existing abnormal con- 
 ditions to change the standards which 
 they were unable to change under nor- 
 mal conditions," 
 
 should now receive an unambig- 
 uous interpretation to assure its 
 practical application as a working 
 principle. To this end we propose : 
 
 (a) That applied to existing stat- 
 utory regulations intended to promote 
 safety and health, it shall be agreed 
 that for the period of the war there 
 shall be no suspension or modification 
 of such provisions, except upon recom- 
 mendation of the Council of National 
 Defense after due investigation by its 
 agencies and when, in its judgment, re- 
 quired by the exigencies of war; 
 
(6) Applied to wages, demands shall 
 be tested by the prevailing local stand- 
 ard of the establishment in effect at the 
 beginning of the war with such modifi- 
 cation as may be shown to be necessary 
 to meet any demonstrated advance in 
 the cost of living. 
 
 (c) Applied to hours, the standard 
 shall be those established by statute or 
 prevailing in the establishment at the 
 beginning of the war subject to change 
 only when in the opinion of the Council 
 of Defense it is necessary to meet the 
 requirements of the Government. 
 
 (d) Applied to what are commonly 
 known as "open" or closed" shop con- 
 ditions, it shall be understood and 
 agreed that every employer entering 
 the period of the war with a union 
 shop shall not by a lockout or other 
 means undertake to alter such condi- 
 tions for the duration of the war, nor 
 shall any combination of workmen un- 
 dertake during the like period to "close" 
 an "open" shop. 
 
 4. Adopting these standards as 
 the basis of its operation, we recom- 
 mend the creation of a Federal 
 board to adjust labor disputes for 
 the duration of the war ; the activi- 
 ties of this Board to be confined to 
 disputes growing out of employ- 
 ment on the subject matter of war 
 production for the Government. To 
 such board shall be primarily re- 
 ferred for final settlement all major 
 disputes of the nature suggested 
 with full power to create all ma- 
 chinery necessary to execute its 
 functions. Its decisions must bind 
 all parties to the dispute. It should 
 be constituted equally of represen- 
 tatives of employees, employers and 
 the Government, representatives of 
 the latter to hold the deciding voice 
 in the event of an equal division of 
 opinion. It is to be further under- 
 stood and agreed that there shall 
 be no interruption of production by 
 strike, lockout or other means 
 within the control of employer or 
 employee. 
 
 5. We pledge to the country, 
 through you, the acceptance of such 
 a program by the great body of 
 
 [44] 
 
 representative associations and in- 
 dividual manufacturers we are 
 authorized to represent. We do not 
 seek to be regarded as the exclusive 
 spokesman of all industry and will 
 cooperate in any helpful capacity 
 with any and every manufacturer 
 whether members of our associa- 
 tion or not. 
 
 6. To secure in the public inter- 
 est a mutual understanding and 
 agreement predicated upon the pro- 
 posals set forth, we suggest: That 
 the Council of National Defense 
 call, at the earliest convenient date, 
 a conference of representative na- 
 tional and international officers of 
 American trade unions that they 
 may be requested to join in the 
 pledge here made on behalf of em- 
 ployers. Their loyal cooperation 
 for the duration of the war will as- 
 sure a known standard of conduct 
 to govern these vital industrial re- 
 lations. The national safety will 
 then no longer be imperilled by dis- 
 putes, halting vital production and 
 necessarily operating to give aid 
 and assistance to the public enemy. 
 
 We reiterate in conclusion the 
 pressing necessity for recognizing 
 one vital and primary principle. A 
 Government which cannot itself 
 discriminate between its citizens 
 cannot tolerate a condition which 
 encourages private organizations 
 to compel such discrimination. Po- 
 litically and economically such a 
 policy spells disaster. It desroys 
 the responsibility of management 
 which is vital to successful produc- 
 tion and denies in our own democ- 
 racy the basic principles of indi- 
 vidual liberty and opportunity, for 
 which its citizens since the founda- 
 tion of the Republic have shed 
 freely of their blood and for which 
 today they are prepared to die on 
 alien soil. 
 
Signed on behalf of the National 
 Industrial Conference Board by its 
 Executive Committee and its Advi- 
 sory Committee: 
 
 Executive Committee: 
 Loyall A. Osborne, 
 
 Chairman, 
 Frederick P. Fish, 
 William H. Barr, 
 A. Lawrence Fell, 
 Charles Cheney, 
 Magnus W. Alexander, 
 
 Executive Secretary 
 
 Advisory Committee: 
 Loyall A. Osborne, 
 
 Chairman, 
 William H. Barr, 
 W. H. Van Dervoort, 
 C. A. Crocker, 
 Ellison A. Smyth, 
 W. A. Layman. 
 
 Endorsed by the following associ- 
 ations not members of the Confer- 
 ence Board: 
 
 California Metal Trades Association, San 
 Francisco, Cal. 
 
 Manufacturers' Association of Connecti- 
 cut, Inc., Hartfori, Conn. 
 
 Manufacturers' Association of Bridge- 
 port, Bridgeport, Conn. 
 
 Georgia Manufacturers' Association, At- 
 lanta, Georgia. 
 
 Illinois Manufacturers' Association, Chi- 
 cago, 111. 
 
 Indiana Manufacturers' Association, In- 
 dianapolis, Ind. 
 
 Iowa State Manufacturers' Association, 
 Des Moines, Iowa. 
 
 Kentucky Manufacturers' & Shippers' 
 Association, Louisville, Kentucky. 
 
 Associated Industries of Massachusetts, 
 Boston, Mass. 
 
 Michigan Manufacturers' Association, 
 Detroit, Michigan. 
 
 Associated Employers of Missouri, St. 
 Louis, Mo. 
 
 Nebraska Manufacturers' Association, 
 Lincoln, Neb. 
 
 Manufacturers' Association of New Jer- 
 sey, Trenton, N. J. 
 
 Associated Manufacturers of Electrical 
 Supplies, New York, N. Y. 
 
 Associated Manufacturers & Merchants 
 of the State of New York, Syracuse, 
 N. Y. 
 
 Ohio Manufacturers' Association, Colum- 
 bus, Ohio. 
 
 Associated Employers of Oregon, Port- 
 land, Oregon. 
 
 Pennsylvania Manufacturers' Associa- 
 tion, Philadelphia, Pa. 
 
 Steel Founders Society of America, Pitts- 
 burgh, Pa. 
 
 Cotton Manufacturers' Association of 
 South Carolina, Greenville, S. C. 
 
 Tennessee Manufacturers' Association, 
 
 Nashville, Tenn. 
 Employers' Association of Washington, 
 
 Seattle, Washington. 
 United Metal Trades Association of the 
 
 Pacific Coast, Seattle, Washington. 
 
 Mr. Samuel Gompers, President of 
 the American Federation of Labor, in 
 their organ, The American Federa- 
 tionist of October, 1917, wrote editori- 
 ally as follows: 
 
 "In marked contrast to the con- 
 structive proposal of the British 
 Committee is the recommendation 
 submitted by the National Indus- 
 trial Conference Board to the Coun- 
 cil of National Defense. That rec- 
 ommendation demonstrates that 
 the autocrats of America are eco- 
 nomic. Like the old Bourbon des- 
 pots, they have learned nothing and 
 forgotten nothing. Their program 
 proposes to assure to employers 
 war opportunities for exploitations 
 and the aggrandizement of special 
 privileges. By carefully selected 
 phrases and terms they thought to 
 conceal their real purpose. They 
 are opposed to progress, to democ- 
 racy, and to constructive organic 
 action in furtherance of human 
 opportunities. 
 
 Special privileges and economic 
 exploitation in this country have 
 been established and maintained 
 through industrial capitalist autoc- 
 racy. Employers have sought to 
 prevent employees from collective 
 bargaining and enlightened coop- 
 eration in accord with an estab- 
 lished program. Under the pre- 
 tense that they were maintaining 
 individual liberty, employers have 
 sought to enforce a so-called "open 
 shop" policy in order to crush out 
 labor organizations, but labor or- 
 ganizations are something more 
 than the term and significance usu- 
 ally applied to trade unions by their 
 opponents; they represent a great 
 aspiration of masses of people for 
 
 [45] 
 
higher ideals of living and for the 
 opportunity to have a voice in de- 
 termining those things which affect 
 them vitally and which are the 
 basis of all living. 
 
 The proposal of the National In- 
 dustrial Conference Board to the 
 Council of National Defense is ex- 
 pressed in terms that imply criti- 
 cism of the motives of trade union- 
 ists in contrast with the "patriotic 
 altruistic" purposes of employers. 
 The organization that presented the 
 proposal is the one organized last 
 Fall and heralded in the paper as 
 the Eight Billion Dollar Corpora- 
 tion which would make a campaign 
 to exterminate the American labor 
 movement. The National Indus- 
 trial Conference Board is a federa- 
 tion of employers' associations 
 which include the following: 
 
 American Cotton Manufacturers' Asso- 
 ciation. 
 
 American Paper and Pulp Association. 
 
 Electrical Manufacturers' Club. 
 
 Manufacturing Chemists' Association of 
 the United States. 
 
 National Association of Cotton Manufac- 
 turers. 
 
 National Association of Manufacturers. 
 
 National Association of Wool Manufac- 
 turers. 
 
 National Automobile Chamber of Com- 
 merce. 
 
 National Boot and Shoe Manufacturers' 
 Association. 
 
 National Council for Industrial Defense. 
 
 National Erectors' Association. 
 
 National Founders' Association. 
 
 National Metal Trades Association. 
 
 Rubber Association of America, Inc. 
 
 Silk Association of America. 
 
 United Typothetae and Franklin Clubs of 
 America. 
 
 These facts made it evident that 
 the declared purpose in the pro- 
 posal can not be accepted as genu- 
 ine and can only be interpreted in 
 the light of the known practices 
 and methods of these organizations. 
 Because these employers see in a 
 war for democracy an opportunity 
 for a great forward movement in 
 establishing human opportunities, 
 they come with a plan which pro- 
 poses to take advantage of the war 
 to block the forward movement of 
 
 [ 
 
 humanity. They accuse organized 
 labor of desiring to take advantage 
 of the war to advance the cause of 
 humanity and make a counter- 
 proposition that the war be taken 
 advantage of to block the progress 
 of humanity. 
 
 The N. I. C. B., as well as the rest 
 of us, well know that life must go 
 either backward or forward ; it can- 
 not stand still. While proposing 
 stagnation during the period of the 
 war, during the time when all social 
 and economic forces are fluid and 
 may crystallize into the form they 
 will take for decades to come, they 
 propose that existing conditions, in 
 accord with old concepts in the 
 practices of exploitation, shall be 
 fastened upon the working people, 
 like shackles, during the period of 
 the war— AND THEREAFTER. 
 
 This is the truce that they pro- 
 pose, to manacle the working people 
 during the period that ought to 
 mean almost inconceivable progress 
 for humanity and democracy. Ac- 
 ceptance of this proposal is unthink- 
 able. Even if any constituted au- 
 thority should attempt to bind and 
 tie the working people to be ex- 
 ploited by this Eight Billion Dollar 
 Corporation, it would fail. No gov- 
 ernment and no agency can or ought 
 to check the natural aspirations of 
 men and women for a higher life 
 and greater opportunity and 
 greater liberty!" 
 
 Hasten the Remedy 
 
 It must be evident that America's 
 Labor problem is as complicated as 
 the human being himself, but that 
 is no good reason for delaying co- 
 ordination of labor investigation 
 and control under one head as free 
 from entanglement and red tape 
 46] 
 
as possible. No greater single prob- also that Arbitration Courts had 
 
 lem lies before Congress, our Admin- proved of great educational value; 
 
 istration or the country at the pres- that wages had greatly increased 
 
 ent time. based upon actual living conditions, 
 
 Sir William A. Holman, Prime but that business had never been so 
 
 Minister of New South Wales, who prosperous. He laid the greatest 
 
 has recently been in this country, stress upon the importance of having 
 
 stated that 50% of all Australia's every labor difficulty receive inime- 
 
 labor troubles during the past ten diate attention and investigation and 
 
 years had been settled without strikes ; the remedy applied without delay. 
 
 [47] 
 
VII 
 
 The Alien Problem 
 
 Our national government contacts 
 with the alien in at least sixteen dif- 
 ferent ways through fourteen differ- 
 ent bureaus and divisions in the De- 
 partments of State, Treasury, Post 
 Office, Interior, Agriculture, Com- 
 merce and Labor. The alien is in 
 every community and in every activ- 
 ity of our national life. Our govern- 
 ment has apparently never looked 
 upon the alien as constituting a un- 
 ified problem, but has acted upon the 
 innumerable phases as they appeared 
 in a disconnected way. 
 
 The most constructive work that 
 has been done toward the assimilation 
 of the alien into our American society 
 has been carried on with private 
 funds by private organizations, such 
 as the National Americanization Com- 
 mittee, the Immigration Committee 
 of the Chamber of Commerce of the 
 United States, and others. Even some 
 of the alien work being done by the 
 government is possible only by the 
 use of private contributions. Thought- 
 ful Americans have for years endeav- 
 ored to arouse a national interest in 
 this problem, upon the happy solu- 
 tion of which America's future in the 
 world so largely depends. 
 
 As soon as we entered the war, re- 
 peated efforts were made to induce the 
 Council of National Defense to ap- 
 point an Alien Committee. With one- 1 
 third of our entire population either 
 of foreign birth or with at least one 
 foreign parent, with little knowledge 
 of the undercurrent of national sympa- 
 thies in the hearts of many of these 
 millions, the great war, even before 
 we entered it, greatly increased the 
 importance and danger of this alien 
 problem. 
 
 [ 
 
 Over three million of our popula- 
 tion cannot speak English. About 
 fourteen million are German born or 
 of German descent, and they appear 
 in every profession and industry and 
 in every occupation from those of the 
 highest skill to those of the meanest 
 manual labor. 
 
 Shortly after America entered the 
 war, one of our greatest authorities 
 on the immigrant visited a large ship- 
 yard and learned that although the 
 management knew how many enemy 
 aliens there were in the establishment, 
 no investigation had been made as to 
 the location of those aliens. When it 
 was found that over forty of the 
 enemy were in the power plant where 
 a small amount of destruction might 
 have crippled the entire yard and that 
 equivalent numbers were in other vul- 
 nerable departments, the dangerous 
 condition was quickly relieved. 
 
 Delay in deciding to place officers 
 and crews of merchant vessels under 
 some sort of military control has re- 
 sulted in the loss and surrender of 
 vessels by cowardly or enemy crews. 
 
 A prominent railroad president was 
 asked if he knew whether there were 
 enemy aliens in his round houses, sig- 
 nal towers or working about bridges 
 and tunnels; the thought had never 
 entered his mind. To the National 
 Board of Fire Underwriters considera- 
 tion of the alien as a fire risk was 
 suggested. The fact that enemy aliens 
 were being discharged, left without 
 means of support or even places to 
 live, aggravated the situation. Some- 
 times they were permitted to remain 
 in vulnerable industries when they 
 might have been shifted to places 
 where they could do no harm. The 
 48] 
 
whole situation was complicated and 
 the remedies were left to individual 
 initiative to apply. 
 
 Although a mass of information, 
 suggestion and definite recommen- 
 dation have been accumulated and put 
 in the hands of our government, this 
 problem yet remains uncentralized. 
 The importance of the alien as one of 
 our largest sources of labor cannot be 
 overemphasized. Our enemies, the I. 
 W. W. and other agitators, have been 
 permitted to focus attention upon the 
 alien while we have neglected simple 
 measures which would go far to 
 change the alien from a menace to 
 an unqualified national asset. Ade- 
 quate attention to this problem might 
 minimize the threatened emigration 
 of many alien workers (estimated at 
 3,000,000 males alone) after the war. 
 
 Twenty million people have reached 
 America via the steerage but yet we 
 have failed to consider this a national 
 problem. Schools exist in this coun- 
 try where it is impossible for the 
 pupil to learn the English language 
 or use the English spelling book. 
 
 To those unfamiliar with this con- 
 dition Professor Edward A. Steiner's 
 
 book, "Nationalizing America," would 
 prove a revelation. 
 
 Our Army officers are already con- 
 fronted with the difficulty of making 
 many of our drafted soldiers under- 
 stand commands and instructions in 
 English. Efforts are being made by 
 the Department of Education, with 
 State cooperation, to improve this 
 condition. Under the war powers of 
 the Federal Government it would 
 seem as if teaching of the English 
 language in every city and village 
 throughout the land could be made 
 compulsory. 
 
 And what of the poor bewildered 
 alien himself? With no place to go 
 for general and authoritative infor- 
 mation, exposed to the machinations 
 of spy and agitator, of profiteer and 
 corruptionist — ought we not commend 
 those great millions for their steadi- 
 ness of purpose and action, their loy- 
 alty and decency under trying condi- 
 tions? Our debt to them rests with 
 the future and American patriots for 
 payment. As yet we have not even 
 provided a place where they can surely 
 obtain official translation into their 
 own languages of the President's 
 proclamations aimed at them. 
 
 [49] 
 
VIII 
 
 Intelligence Service 
 
 There are in Washington at least eight 
 Secret Service or Intelligence func- 
 tions, each headed up to a cabinet of- 
 ficer and all uncoordinated save 
 through gentlemen's agreements and 
 individual cooperation. Jealousy ex- 
 ists not only between the individual 
 organizations themselves, but the Cab- 
 inet officers cannot agree upon a plan 
 of coordination. It is rumored that 
 every Cabinet officer concerned favors 
 coordination, but that several of them 
 think their own departments should 
 be the coordinating mechanism. Thus, 
 it is said Secretary Lansing would 
 like to have the intelligence efforts 
 head up to his department because he 
 controls some international contacts. 
 Some of the Post Office Department 
 officials are said to believe that the 
 Post Office Department, being the 
 largest intelligence mechanism, should 
 be the head. The Treasury Depart- 
 ment, where the secret service origin- 
 ated, might reasonably expect leader- 
 ship. Most of the work, however, has 
 been done by the Department of Jus- 
 tice, which does not desire to be in- 
 terfered with. And so the chaotic 
 condition is permitted to continue. 
 
 The public has admired the ef- 
 ficiency of our Federal intelligence 
 work, unwitting that many of its ac- 
 credited -successes have been due to 
 foreign intelligence organizations and 
 to the efforts of private citizens and 
 organizations. The Providence Jour- 
 nal, under the leadership of its inde- 
 fatigable editor, John R. Rathom, has 
 apparently at times almost driven our 
 Federal service to activity. Bitter 
 complaint exists today on the part of 
 some of our intelligence organizations 
 against the Department of Justice, 
 
 which is said merely to punish rather 
 than prevent enemy activity. The 
 number of suspected spies who have 
 been taken into custody and then re- 
 leased in spite of considerable sus- 
 picion remaining is said to have been 
 contrary to the action of most of our 
 allies under similar circumstances. 
 TheNew YorkTimes of December 24th, 
 1917, editorially condemns releasing 
 prominent Germans on parole, claim- 
 ing that they are either innocent or 
 guilty and that parole meets neither 
 condition; that spies are prepared to 
 lie and the periodical reporting by the 
 men on parole needs only willingness 
 to lie to enable them to continue dan- 
 gerous spy activities if they so desire. 
 
 What Disaster? 
 
 At the recent Canadian Club dinner 
 in New York Mr. Rathom said: 
 
 "The Secret Service of the United 
 States and the Bureau of Investiga- 
 tion of the Department of Justice 
 — the two official weapons, and the 
 only two, which stand between our 
 people and disaster at home — are 
 ridiculously undermanned and ridic- 
 ulously underpaid. The loyalty and 
 intelligence of these men is beyond 
 question. The lack of facilities for 
 their work and for the scope of 
 their work is a national disgrace. 
 The entire sum paid by the United 
 States to maintain these two vitally 
 important bureaus per annum is 
 actually less than the amount of 
 money paid by Ambassador Bern- 
 storff per month for German Secret 
 Service operations in the City of 
 New York alone. The financial loss 
 entailed by the Baltimore fire is 
 
 [SO] 
 
probably four times the entire an- 
 nual cost of both of these bureaus. 
 What terrible calamity must we go 
 through, what immense destruction 
 of war materials vital to our future 
 freedom must we see before we deal 
 with this question with a stern and 
 unyielding hand and with a deter- 
 mination to stamp out treachery 
 wherever it shows its head?" 
 
 Last August a carefully studied 
 plan for circumventing dangerous en- 
 emy activities in grain elevators, food 
 factories and other important elements 
 in our food supply system was pre- 
 sented to Mr. Hoover's department 
 with the statement that since America 
 entered the war destruction of grain 
 elevators had increased 300%. This 
 statement was corroborated by infor- 
 mation in the possession of the Food 
 Administration and the importance of 
 action in this field was admitted. The 
 question arose, however, as to whether 
 the Department of Justice was not 
 covering the field and whether addi- 
 tional activity by the Food Adminis- 
 tration would be welcome. The plan 
 was not put into effect, although vari- 
 ous efforts have been made by the 
 Food Administration to meet this dan- 
 ger. The fact remains, however, that 
 since last August the destruction of 
 food has been going on at a terrific 
 pace and the statement has been made 
 that in one period of thirty days food 
 to the value of thirty million dollars 
 was destroyed. 
 
 This is a difficult field to discuss 
 frankly in public. Perhaps an investi- 
 gation behind closed doors by one of 
 the Congressional investigating com- 
 mittees would go far toward pointing 
 out weaknesses and overcoming per- 
 sonal prejudices and jealousies. It 
 might result in the coordination, un- 
 der a real Intelligence Chief, essential 
 not only to our national war plans, but 
 
 also to the safety of thousands of 
 American lives and hundreds of mil- 
 lions of dollars' worth of American 
 property constantly menaced by the 
 continuation of present conditions. 
 
 Below is an incomplete list of the 
 damage to American life and property 
 caused by enemy aliens prior to our 
 entering the war. This is taken from 
 "A Few Lines of Recent American 
 History" issued by the Providence 
 Journal. 
 
 1915-1916-part of 1917. 
 
 Munitions Plants 
 
 Explosions 49 
 
 Fires 17 
 
 Killed 147 
 
 Hurt 142 
 
 Loss (only a few losses are 
 mentioned, 14 given) $35,000,000 
 
 Ships — Fires 
 
 En route 15 
 
 In port 13 
 
 Killed (1 case only) 12 
 
 Loss (1 case only) $3,000,000 
 
 Trains 
 
 Wrecked 2 
 
 Killed 5 
 
 Miscellaneous 
 
 Munition manufacturer's house 
 bombed 1 
 
 Canal plot discovered 1 
 
 Private homes, plot discovered 2 
 
 This pamphlet clearly shows the 
 need of Congressional investigation in 
 this field. It is enlightening to com- 
 pare our safeguards with the bold 
 measures Canada and Great Britain 
 have taken. 
 
 Even the individual intelligence de- 
 partments are sometimes in danger of 
 having their activities seriously weak- 
 ened through lack of understanding of 
 the situation. For instance, the Army 
 Intelligence would probably have had 
 its activities almost entirely sus- 
 pended had not, through the assistance 
 
 [51] 
 
of private individuals and newspaper 
 men, the appropriation of $489,000 for 
 continuation of its work been squeezed 
 into the appropriations bill during the 
 last days of the last session of Con- 
 gress. It was supposed that the pre- 
 vious appropriation would carry the 
 department along until the next Con- 
 gress could consider the matter of fur- 
 ther appropriation, but a better under- 
 standing of conditions would probably 
 have caused the last Congress to in- 
 crease the appropriation rather than 
 to think of eliminating it. 
 
 The greater the changes in the 
 world, the greater is the need of in- 
 formation from all parts of the world, 
 focusing in Washington and made 
 available in condensed form for our 
 leading executives to use as a basis 
 for their national and international 
 policies. Our foreign intelligence 
 service is totally inadequate to this 
 need. Most of our enemies, and, in 
 fact, most of our allies, have more 
 accurate and far-reaching informa- 
 tion about the rest of the world than 
 have we. Private individuals and 
 corporations are in some instances 
 trying to assist, but no thorough plan 
 to organize those auxiliary assistants 
 under centralized government leader- 
 ship has yet appeared. More than ever 
 before, International relationships 
 will be largely affected by national ad- 
 
 vertising and national interpretation 
 of events. 
 
 Japan, during her Russian war, ad- 
 vertised in this country to obtain the 
 favor of American public opinion, and 
 it proved such a good investment that 
 she has greatly expanded such activi- 
 ties.* Only efficient intelligence serv- 
 ice can counteract the danger of such 
 influence being misused. 
 
 Any one who has been privileged to 
 look over the mass of German propa- 
 ganda gathered in the British Postal 
 Censorship Building in London is over- 
 whelmed by the scope and ramifica- 
 tions of the German propaganda or 
 national advertising system. In 
 every language and many dialects of 
 the world, addressed to every religious 
 faith, arousing the accumulated prej- 
 udices of centuries, this German 
 propaganda knows no moral limits, 
 contradicts itself where necessary to 
 justify the German state and German 
 aims. Deceptive, lying, misrepre- 
 senting, the whole world has visibly 
 tasted its results. Many of these 
 results will be continuing and can 
 only be overcome by honest coun- 
 ter-propaganda. This is indeed a na- 
 tional and international problem of a 
 critical sort and upon the successful 
 solution of it depends the future peace 
 of the world. 
 
 *Read Montaville Flowers' "The Japanese 
 Conquest of American Opinion." 
 
 I5§] 
 
IX 
 
 Contracts 
 
 When one pauses to consider that the 
 billions of dollars being expended for 
 war work in America are largely rep- 
 resented by innumerable individual 
 contracts, the importance of having a 
 few fundamental principles applied to 
 contracts, as far as possible, must at 
 once be admitted. Many contracts 
 have been prepared in haste with sat- 
 isfactory results. Others have had 
 ample consideration and are yet un- 
 satisfactory. Some contracts, whether 
 drawn hastily or not, have proven emi- 
 nently fair to both sides. Through the 
 contract it is possible to direct and 
 control many of the industrial and so- 
 cial conditions which the Federal gov- 
 ernment desires to control, especially 
 during the war. It has been proposed, 
 for instance, that all Army and Navy 
 contracts should include clauses guar- 
 anteeing adequate working conditions 
 for the employees of the contractor, 
 also adequate precaution against fire, 
 delay, damage by enemy activities and 
 various other items. In addition to 
 such considerations, the inclusion of 
 clauses to insure maximum speed 
 based upon maximum incentive, with 
 adequate protection against excessive 
 profits, should receive general at- 
 tention. 
 
 Our contracts for cantonments built 
 on a "cost plus" basis, in no case, as far ' 
 as we are aware, contained adequate 
 provision against excessive cost. Many 
 investigators pointed to intolerable 
 loafing by workmen, inefficient use of 
 horses, steam shovels and other equip- 
 ment, partly because the United States 
 was footing the bills and superintend- 
 ents and foremen, if not the contrac- 
 tors themselves, were willing to have 
 costs unnecessarily high. Such lack 
 
 [53 
 
 of patriotism not only increased cost, 
 delayed completion of the cantonments, 
 but also hampered other war produc- 
 tion. It is unnecessary to criticise any 
 individuals or groups, because all 
 classes in this country have been, to 
 a certain extent, open to similar 
 charges. Profiteering in one form or 
 another has permeated every class of 
 society, from the lowliest workman to 
 the wealthiest official. Fortunately, 
 self-sacrificing patriotism has been 
 visible in greater degree as the criti- 
 cal nature of the war and the vast 
 stake the Americans have in it become 
 more apparent. No one questions the 
 ultimate patriotism, to whatever de- 
 gree necessary, on the part of practi- 
 cally every American. More careful 
 business management, use of ordinary 
 business method and precaution would 
 automatically obviate not only the op- 
 portunity, but the excuse for much of 
 this profiteering. 
 
 Contracts for supplies have often 
 been loaded upon a comparatively few 
 plants, whereas systematic distribu- 
 tion would have produced quicker de- 
 deliveries and less disturbance of 
 established production. Thus shoe con- 
 tracts have at times entirely disrupted 
 the business of going concerns which 
 accepted orders under patriotic im- 
 pulse while their competitors were left 
 undisturbed. 
 
 In some of the shipbuilding con- 
 tracts drawn by the Shipping Board, 
 provision was made for reward in case 
 of exceptional speed of construction 
 and for forfeit in event of excessive 
 delay. Bonus and forfeit contracts are 
 not new to the business world and are 
 fair, when properly drawn, to both par- 
 ties concerned. Several of the can- 
 
 ] 
 
tonment contractors have admitted 
 that such provisions could have been 
 included in the cantonment contracts. 
 This omission has cost the nation mil- 
 lions of dollars, unrealized delay and 
 bad examples, of which the effect on 
 the country is beyond estimate. 
 
 Apply General Principles 
 
 It would not be difficult to provide 
 a Committee of Contract Experts, in- 
 vested with the responsibility for hav- 
 ing certain fundamental principles ap- 
 plied in all contracts, as far as possible, 
 and have this committee used in an 
 advisory capacity by every department 
 making contracts. Such a committee 
 would probably centralize and formu- 
 late many of the difficulties which are 
 constantly causing delays, misunder- 
 standings, incrimination and put in 
 the hands of our leading executives 
 material for formulating policies 
 which would help to clarify the whole 
 field of war preparation; and it is not 
 too much to say that they could scarce- 
 
 ly fail to point out "follow-up" and 
 various checking methods that would 
 by foresight prevent delays in pur- 
 chasing, production and delivery. 
 
 One sometimes gets the impression 
 that our executives face their prob- 
 lems primarily from a politician's 
 standpoint. One of our leading execu- 
 tives urging a contractor to double his 
 contract but to accept his original limi- 
 tation of profit, argued that Congress 
 and the country would look askance at 
 one organization receiving such a large 
 amount in profits. This was a remark- 
 able spectacle of a man entrusted with 
 spending hundreds of millions of dol- 
 lars of the people's money, urging that 
 a big order should receive no more 
 profit than an order half the size. Can 
 we not rely upon the country approv- 
 ing of any arrangement, founded upon 
 a fair and just understanding, whether 
 it be with individual or corporation 
 and whether it be for $10 or $100,000,- 
 000? Can a business war be won by 
 neglecting business principles? 
 
 [54] 
 
X 
 
 Transportation 
 
 As modern war has proved to be a 
 war of industry, transportation natu- 
 rally became the keystone of the arch 
 of military strength. Recognizing the 
 importance of transportation, the 
 Council of National Defense appointed 
 one of its seven Advisory Commis- 
 sioners Chairman of its Transporta- 
 tion Committee. The Advisory Com- 
 mission of the Council of National 
 Defense held its organization meeting 
 early in December, 1916, and shortly 
 afterward its various leading commit- 
 tees were formed. 
 
 Upon invitation of Secretary Baker, 
 each Governor of a State was re- 
 quested to attend a conference to be 
 held in Washington the first week in 
 May, 1917. At that time Mr. Daniel 
 Willard was not only Chairman of the 
 Committee on Transportation, but was 
 also Chairman of the Advisory Com- 
 mission itself. As Chairman of the 
 Commission, he explained to the Gov- 
 ernors and their representatives 
 (there were ten Governors and direct 
 representatives of thirty-eight others 
 present) the apportionment of re- 
 sponsibility among the Advisory Com- 
 missioners and then outlined the work 
 of the Transportation Committee. A 
 sub-committee on Railroads had been 
 appointed and its activities were de- 
 scribed at some length. A sub-com- 
 mittee on Electric Railways had re- 
 cently been appointed and its plans 
 were set forth. A third sub-commit- 
 tee on Inland Waterways was soon to 
 be appointed and the fourth of the 
 fundamentally important transporta- 
 tion sub-committees, that on High- 
 ways, would later receive considera- 
 tion. 
 
 Practically every State represented 
 
 in this conference was much interested 
 in road improvement. Some had large 
 appropriations for this purpose, others 
 were discussing them. All wished to 
 know what the Federal Government 
 desired. It was expected that there 
 would be plans for a national road- 
 building campaign, insuring concen- 
 tration of energy upon roads of na- 
 tional military or industrial impor- 
 tance and elimination of unnecessary 
 construction. Did war needs necessi- 
 tate special construction of roads or 
 strengthening of bridges or changing 
 of tunnels and culverts? All of these 
 questions remained unanswered and 
 the Governors were left to use their 
 own best judgment. This was a prob- 
 lem which had received considerable 
 notice in the public press, but yet had 
 escaped the attention in Washington 
 necessary for working out a central- 
 ized plan for war needs. 
 
 Five months after the Advisory 
 Commission had been organized, a 
 committee on Inland Waterways still 
 remained to be appointed. In the 
 meantime, information on this subject 
 was desired and another department 
 of the Advisory Commission carried 
 on some investigations which properly 
 belonged to the Transportation Com- 
 mittee. The Highway Committee was 
 appointed in November, 1917, eleven 
 months after the Advisory Commis- 
 sion organized. 
 
 The subject of river and harbor im- 
 provements and the development of 
 inland water transportation is rather 
 an unhappy one for Americans to con- 
 sider. While our greatest commercial 
 rivals have been carrying to a high 
 state of development such facilities in 
 their own countries, America has per- 
 
 [55; 
 
mitted the competitive system carried 
 out by the railroads to overshadow 
 completely the advantages of water 
 transportation. With the finest sys- 
 tem of waterways in the world trav- 
 ersing our fertile plains and connect- 
 ing our storehouses of mineral wealth, 
 we have spurned this help of nature in 
 simplying our national carrying prob- 
 lem. The policy of Congress, forced 
 by public demand, has been competi- 
 tion among the railroads. This is pri- 
 marily responsible for our unbalanced 
 transportation development, which in 
 time of war is reducing our military 
 strength by a terrifying percentage. 
 
 The Railroads War Board have done 
 magnificent work under tremendous 
 difficulty, correcting many abuses of 
 the past, and, as far as lay within 
 their power and experience, elimina- 
 ting the gaps and stone walls built up 
 by competitive antagonisms. The more 
 intelligent of our railroad leaders 
 frankly admit that this method has 
 distinct limitations and that some sort 
 of government control or supervision 
 was necessary before even a unified 
 railroad system could be attained. It 
 has been so largely within the power 
 of railroads to kill water competition 
 that it was folly to expect private cap- 
 ital out of sheer patriotism to invest 
 the large sums necessary in quickly de- 
 veloping water transportation. This 
 can only be done under government 
 control and with national funds; and 
 then the same assistance is needed to 
 dovetail water transportation into rail 
 transportation to produce an effective 
 combination of facility and operation. 
 
 The same remarks apply in some- 
 what lesser degree to the electric rail- 
 ways, although these have not been 
 feared and fought to the same degree 
 as water carriers, because they were 
 less dangerous competitors owing to 
 their higher cost of operation. 
 
 Facilities Neglected 
 
 Another transportation mechanism 
 which has been sadly neglected by 
 Washington is the motor truck. A 
 vehicle capable of dodging congested 
 districts and thoroughfares, able to 
 sidetrack crowded terminals, should 
 have received from the beginning of 
 our transportation troubles persistent 
 and profound study and application on 
 the part of the men to whom the nation 
 was looking to solve our transporta- 
 tion problems. Our transportation 
 leaders are visibly the railroad men, 
 but unfortunately most of them have 
 limited their sense of responsibility 
 to railroad transportation and have 
 minimized the importance of the aux- 
 iliary services. It has long been with- 
 in the power of the railroads to organ- 
 ize modern truck service in such ways 
 as largely to solve that ever-present 
 difficulty, the congested terminal. 
 Many of our cities are today crowded 
 with trucks inefficiently used, which, 
 if organized under railroad leadership 
 could greatly increase their usefulness 
 and relieve not only the crowded 
 streets but also much of the congestion 
 in our freight depots and yards. 
 
 Unfortunately, it remains for pri- 
 vate initiative to organize service, lo- 
 cal, inter-community and even inter- 
 state. This, however, is being done 
 and through this private initiative 
 such service will probably be ultimate- 
 ly harmonized with that of our estab- 
 lished carriers. In similar fashion 
 private initiative, supported by the be- 
 lated Highways Committee, is obtain- 
 ing improvement of important high- 
 ways, involving application of State 
 funds and doing the many other acts 
 which our national emergency has 
 forced upon the individual or State 
 because the Federal officials did not 
 rise to their opportunity. 
 
 In the production of rolling stock so 
 
 [56] 
 
badly needed, the same type of inef- 
 ficiency is visible. Recently, while Rus- 
 sian orders for rolling stock were be- 
 ing cancelled, the factories that had 
 been working on those orders were 
 facing idleness. Prompt action ac- 
 cording to the press had not been 
 taken to insure speeding up rather 
 than slowing down of such production. 
 Meanwhile the railroads had long 
 been spending millions of dollars be- 
 longing to their stockholders to foster 
 public good-will, sometimes to empha- 
 size their virtues in relatively unim- 
 portant matters, rather than drawing 
 attention to fundamental coordination 
 of all transportation facilities under 
 governmental direction, and under 
 laws and regulations calculated to ben- 
 efit and protect all interests concerned. 
 The Farmers' Non-Partisan League 
 last summer had an educational book- 
 let prepared for distribution to its 
 members showing the expenditures by 
 railroads and other great corporations 
 to influence public opinion not always, 
 from the farmer's point of view, to the 
 advantage of the public. 
 
 Real Standardization 
 
 Raiload men think that they have 
 applied most of the benefits of that 
 misunderstood term "standardization." 
 They have scarcely scratched the sur- 
 face. Pooling of the facilities, knowl- 
 edge and personnel of the railway 
 equipment builders, simplification of 
 design, application of the engineering 
 knowledge which has been applied to 
 many industries for the handling of 
 material have as yet received only 
 superficial attention as far as visible 
 results show in the railroad field. 
 
 Henry Ford, the man who in one 
 year produces one million vehicles 
 capable of carrying 50% of their 
 weight over country roads, criticises 
 the railroads for being years behind 
 
 [ 
 
 the times in utilizing modern knowl- 
 edge of light alloys and structural 
 principles which would permit their 
 freight and passenger cars to carry 
 a much heavier load compared with 
 the weight of the rolling stock itself. 
 
 "Passenger trains," says Ford, 
 weigh 50 to 150 times as much as the 
 passengers in them. Four-fifths of a 
 railroad's work today is hauling the 
 dead weight of its own wastefully 
 heavy engines and cars. This is why 
 railroad presidents have such a hard 
 time to figure out freight and passen- 
 ger rates on the 20% of live load to 
 cover the cost of hauling this enor- 
 mous 80% of dead weight around." 
 
 Strange as it may seem, with the 
 partial exception of coal and iron, the 
 railroads have not applied engineering 
 knowledge to the bulk handling of 
 many of the commodities they carry. 
 It is an inspiring sight to see an entire 
 car loaded with coal or iron ore picked 
 up bodily and its contents dumped al- 
 most instantly into a storage pile or 
 the hold of a vessel. Hopper bottom 
 coal cars have released thousands of 
 laborers for other service, but we are 
 still piling box cars full of grain and 
 patching up the grain doors when they 
 get out of repair. When the question 
 was put to a leading railroad presi- 
 dent recently "Why do you not load 
 grain through the roof and empty it 
 through the bottom of a car," the an- 
 swer was "We have never yet suc- 
 ceeded in making an opening through 
 the roof of a car and keeping it tight 
 against the weather." And this in the 
 day of the submarine! 
 
 Many of the wonderful engineering 
 achievements at Panama must be cred- 
 ited to railroad engineers, but the 
 daring and vision of Panama are large- 
 ly lacking on the railroads themselves. 
 Should not this entire transportation 
 problem with all of its ramifications 
 be considered today from a national 
 57] 
 
standpoint, every effort, every idea 
 coordinated and rapid progress forced 
 by pressure intelligently applied 
 through individuals or committees re- 
 sponsible for progress in the entire 
 war effort of the country ? What court 
 of appeal has been provided to prevent 
 overlooking of important possibilities ? 
 
 Let us hope that Mr. McAdoo will 
 provide a Construction and Engineer- 
 ing Committee to consider the pooling 
 of all the national production and en- 
 gineering resources that might assist 
 in obtaining the maximum output and 
 simplicity of rolling stock as well as 
 a general improvement in efficiency 
 and economy in the field of freight 
 handling by mechanical means. 
 
 A ruling by the Priority Committee 
 prohibiting railroads from transport- 
 ing road building material is said to 
 have been promulgated upon two or 
 three days' notice. As a result several 
 road building contractors were con- 
 fronted with bankruptcy and work was 
 immediately stopped on some high- 
 ways which in two or three weeks 
 would have been finished. 
 
 Long stretches of road were ren- 
 dered unusable because small sections 
 were left uncompleted. The mechan- 
 isms needed for necessary highway 
 construction were therefore seriously 
 crippled, much of which could have 
 been prevented had a few weeks' notice 
 of the forthcoming order been dis- 
 seminated. 
 
 France has already been saved by 
 her use of roads. Great Britain and 
 France both have considered their 
 highways fundamental to war succcess, 
 while America, amply forewarned, has 
 failed to plan and has crippled road 
 construction and maintenance. 
 
 In some minds perhaps, the rail- 
 roads represent the only worth-while 
 transportation mechanism, but ade- 
 quate planning would minimize such 
 serious misjudgment. 
 
 As a result of neglect of planning 
 and organization the year 1917 ends 
 with freight conditions as indicated 
 by the following newspaper items: 
 
 The Evening Post (N. Y.) states 
 that on December 14th, according to 
 freight agents and lighterage men, 
 there were more than 200,000 carloads 
 of freight at a standstill within a 
 radius of 300 miles of New York. 
 This is about 9% of total number of 
 cars in the United States, estimated 
 at 2,300,000. 
 
 From the Washington Post of 
 December 29, 1917. 
 
 Effects of 
 Railroad Congestion 
 
 "How intimate and vital is the rela- 
 tionship of the battle front in 
 France with the transportation 
 system in the interior of the United 
 States is shown by the situation 
 now existing in the port of New 
 York. Surely the American pub- 
 lic has not forgotten how the con- 
 fidence of the entente powers was 
 shaken when the German submar- 
 ine campaign reached its high- 
 water mark last spring. In one 
 month England lost 560,000 gross 
 tons of shipping. The situation 
 was considered so serious that the 
 British premier said that victory 
 depended upon one thing — ships, 
 ships, and again ships. How vitally 
 important, therefore, must we con- 
 sider the tying up of 1,000,000 
 gross tons of shipping in New York 
 harbor alone. It is reported that 
 that amount of shipping is held 
 in New York harbor today because 
 of the one fact that the railroads 
 of the United States have been un- 
 able to deliver enough coal to en- 
 able them to leave. 
 
 Of these ships twenty-two have 
 
 [58; 
 
been held at New York from lack 
 of coal since November 24 — more 
 than a month. Four of these twen- 
 ty-two ships are engaged solely in 
 the transportation of ammunition 
 to the French armies. Other of the 
 ships are transport vessels in the 
 service of the United States Ship- 
 ping Board, directly depended 
 upon to supply the fighting forces 
 abroad, while practically all of them 
 carry cargoes that exercise an im- 
 portant influence upon the conduct 
 of military operations against Ger- 
 many. 
 
 Thus it is clear that the coal 
 shortage, in this respect, is serious- 
 ly cutting down the strength of the 
 armed forces opposing Germany, 
 and for this, we are told, the trans- 
 portation system is responsible. 
 Ships arriving at New York have 
 increased the congestion of the har- 
 bor, which prevents vessels dock- 
 ing and unloading or loading their 
 cargoes, and which will delay 
 steamers even after the coal ar- 
 rives. 
 
 The entire war machine is like 
 a row of dominoes which a child has 
 set up on end. As soon as one 
 piece falls, the whole line tumbles 
 down. It is only by keeping a con- 
 stant watch over every part of the 
 war machine and by forcing ab- 
 solute coordination between all 
 parts that the machine can be kept 
 running and the constant flow of 
 military power to the battle front 
 maintained. If the transportation 
 of coal to New York is blocked, the 
 ships in harbor are tied up. That 
 in turn causes congestion of harbor 
 facilities and throws out of gear 
 the harbor arrangements in France. 
 Cargoes reach French ports spas- 
 modically, at one period too few, 
 and then too many. That, in .turn, 
 places an uneven burden upon the 
 
 strategic railways in France, so 
 that they are alternately congested 
 and idle. The arrival of supplies at 
 the front is thrown off schedule, 
 and thus the troops are unable to 
 exert their full strength against 
 the enemy at the opportune mo- 
 ment. 
 
 Unless this intimate and vital 
 relationship between cause and ef- 
 fect is kept in mind, we are apt to 
 regard the action of the govern- 
 ment in taking over the railroads 
 as being of importance only for the 
 solution of a few domestic trans- 
 portation problems. As a matter 
 of fact, it is very easy to trace the 
 effect of the railway congestion 
 straight to the fighting front. When 
 Secretary McAdoo speaks of the. 
 vital importance of railroad con- 
 trol and of the necessity of his 
 having the cooperation of every 
 American citizen to assist him in 
 his new task, he has in mind the 
 welfare of the boys in France as 
 well as the comfort of citizens at 
 home." 
 
 Some form of government control 
 of railroads has appeared for several 
 months to unbiased thinkers as in- 
 evitable. During that precious time 
 what plans has Washington (either 
 responsible government or railroad 
 officials) prepared in advance so that 
 speedy comprehensive orders could be 
 issued by the Railroad Director im- 
 mediately he ivas in charge? Events 
 are again giving a disappointing an- 
 swer. 
 
 Newspapers are now frequently 
 quoting opinions of prominent rail- 
 road men to the effect that the advan- 
 tages of railroad coordination under 
 unified government control will be so 
 great that the public will never toler- 
 ate reversion to the prior conditions 
 which existed before Mr. McAdoo was 
 
 [59] 
 
made Railroad Director. Strangely 
 enough some of these very railroad 
 leaders a few days ago were demand- 
 ing further trial of a coordinated 
 competitive system, represented by the 
 Railroad War Board. Why did not 
 our transportation chiefs long ago 
 point out to the country what was 
 needed to achieve a real national 
 transportation system? Instead they 
 filled the press with tales of the 
 achievements of the old system which 
 distracted the attention of the public 
 from the real need. Much of our pres- 
 ent suffering and war inefficiency 
 could have been avoided by such 
 frank courage on their part. As it 
 is, we must, in spite of their splendid 
 efforts, hold them responsible for part 
 of our present disaster, for it is noth- 
 ing less. 
 
 The following article from the New 
 York Evening Mail of December 29, 
 1917, illustrates the difficulty expe- 
 rienced by "System" men in freeing 
 themselves from the habits of mind 
 of which their business associations 
 make them victims. 
 
 "President Rea, of the Pennsyl- 
 vania Railroad, has entered a pro- 
 test against an editorial of The 
 Evening Mail which incidentally 
 criticised that lack of foresight in 
 our public regulating bodies which 
 allowed the Pennsylvania to erect 
 a New York passenger terminal ex- 
 cept in cooperation with the other 
 Jersey roads. The president of the 
 Pennsylvania Railroad, especially 
 this president, deserves a fair an- 
 swer to the objections he raises. 
 
 On November 6, 1917, The Mail 
 published an editorial of which the 
 keynote was this : 
 
 In the port of New York is illustrated, 
 better than anywhere else in the United 
 States, the waste and inefficiency of the 
 competitive system in industry and trans- 
 portation. 
 
 We pointed out the lack of co- 
 ordination in the freight handling 
 facilities of New York harbor. We 
 instanced the useless duplication of 
 lighterage services in the harbor, a 
 separate lighterage service being 
 maintained by each railroad. The 
 result is that barges that carry 
 from 50 to 300 tons each are to be 
 found carrying single carloads of 
 freight of 15 to 20 tons between 
 the railroad terminals and the 
 ships. 
 
 We advocated pooling of the 
 lighterage equipment of the rail- 
 roads and, still further than that, 
 the pooling and joint use of all the 
 railroad terminals on the Jersey 
 side. 
 
 The New York freight shipping dis- 
 trict should be considered as one great 
 terminal, to be operated jointly for the 
 account of the roads which serve us. The 
 charges and the profits of this terminal 
 service could be distributed in proportion 
 to the amount of freight which each road 
 contributed. 
 
 To this portion of the editorial 
 
 no dissenting voice has been raised. 
 
 But obviously it is as wasteful to 
 
 have unnecessary duplication of 
 
 passenger as of freight facilities. 
 
 Therefore we said: 
 
 In great centers like New York land 
 is too valuable, space too precious, to 
 allow this senseless duplication of termi- 
 nal installations and terminal operations. 
 We cannot have it. The great Pennsyl- 
 vania terminal at Thirty-fourth street is 
 a standing monument to the inefficiency 
 and waste of our system. It was built 
 hy the Pennsylvania Railroad alone, and 
 has been a white elephant upon that rail- 
 road's hands. Not for years will its 
 handling capacity be fully utilized. In 
 the meantime the other Jersey roads stop 
 across the river from us and ferry their 
 passengers to and fro. Ten years from 
 now men will look back with amazement 
 at a government which allowed the Penn- 
 sylvania alone to build that railroad ter- 
 minal. 
 
 To this illustration President 
 Rea, of the Pennsylvania, took ex- 
 ception.. He addressed an open 
 
 [60] 
 
letter to the editor of The Evening 
 Mail and sent the letter also to the 
 other papers. He said: 
 
 Contrary to that opinion, the Pennsyl- 
 vania station, instead of being a monu- 
 ment to inefficiency and waste and a white 
 elephant, is a monument to foresight and 
 the necessities of New York City and the 
 whole country with which it does business, 
 and more especially so for the Pennsyl- 
 vania system, whose passenger revenues 
 are about 20% greater than the next 
 largest railroad system of the country. 
 
 We never said or intimated that 
 the Pennsylvania Terminal is a 
 standing monument to the ineffi- 
 ciency and waste of the Pennsyl- 
 vania. Quite the contrary. It is 
 such a monument to our system of 
 dealing with the railroads. By say- 
 ing that the Pennsylvania Terminal 
 is a "white elephant" on the rail- 
 road's hands, we meant that the 
 additional fixed charges which it 
 imposed upon the Pennsylvania 
 system were such as to wipe out a 
 large part of the great financial 
 margin with which the Pennsyl- 
 vania was blessed before that ter- 
 minal was undertaken. Mr. Rea 
 does not deny our assertion that 
 "not for years will its handling 
 capacity be completely utilized." 
 He says that it was built for the 
 future, the future of the Pennsyl- 
 vania : 
 
 What would the public say of a man- 
 agement with an actively expanding busi- 
 ness which built for the present only? 
 That station is built for the present and 
 for the years to come, and is go adapted 
 as to handle the increasing traffic of the 
 Pennsylvania and its Long Island rail- 
 roads and also such traffic as the New 
 Haven will put into it and through it; 
 if justified, more tunnels may be built, 
 the station and yard facilities being ade- 
 quate therefor. 
 
 Why if there is so much hand- 
 ling capacity of this terminal, and 
 if its handling capacity can be so 
 easily increased, why not let the 
 other Jersey railroads now make ap- 
 
 propriate connections with the Penn- 
 sylvania's tunnel line and run their 
 through trains into the terminal? 
 That seems to be the only chance 
 they will ever have to land passen- 
 gers directly in New York. Mr. 
 Rea says: 
 
 The building of this great work would, 
 by reason of its cost be prohibitive. 
 
 If the building of this work 
 would be prohibitive, the building 
 of a similar work for the Jersey 
 railroads, individually or jointly, 
 would be similarly prohibitive. 
 
 But Mr. Rea implies that it would 
 be impossible to accommodate the 
 passenger traffic of all the Jersey 
 roads in one station. 
 
 Let me express the opinion here that a 
 union station could not be built in that 
 huge city (New York) that could con- 
 veniently accommodate all the rail traffic. 
 If attempted, the cost, and the congestion 
 around it, and upon the approach streets, 
 would make its useful operation imprac- 
 ticable. 
 
 That would be quite true if all 
 the huge suburban passenger busi- 
 ness of all the Jersey roads were 
 poured through one funnel, no mat- 
 ter how large. But the other Jersey 
 roads would not by any chance use 
 that station for the larger part of 
 their suburban business. The 
 Pennsylvania does not so use it to- 
 day. Mr. Rea says: 
 
 The station was constructed for the 
 future and primarily for the long-distance 
 passenger travel to and from New York, 
 New England, the southern and western 
 states, the local suburban traffic to New 
 Jersey being accommodated through the 
 joint service so successfully inaugurated 
 between Newark and New York via the 
 Hudson tunnels, which is handling about 
 200% more passengers than in its first 
 year of operation. 
 
 The other Jersey roads would 
 continue to handle most of their 
 local and suburban traffic to New 
 Jersey exactly as they handle it to- 
 day; by ferry service or use of the 
 
 [61] 
 
Hudson tunnels. That traffic orig- 
 inates in lower New York. Down- 
 town suburban travelers on the 
 Jersey Central or the Erie would 
 not ride on the Seventh avenue sub- 
 way up to Thirty-fourth street in 
 order to get a train — no more than 
 will the Pennsylvania commuters 
 today. The addition to the present 
 passenger business at the Pennsyl- 
 vania station would be the addition 
 of the through trains of the other 
 Jersey roads carrying long-distance 
 passenger travel to and from New 
 York — just the sort of business 
 that the Pennsylvania is carrying 
 today. 
 
 Ah, the Pennsylvania would say, 
 that would let the other railroads 
 in upon us to share in the competi- 
 tive business south and west, of 
 which we now have the larger por- 
 tion because of our preferred ter- 
 minal location. All right, go and 
 pool your competitive passenger 
 business. We are about ready to 
 allow that. Divide the total of your 
 joint revenues on competitive busi- 
 ness according to percentages that 
 represent your respective portions 
 today. Then how would the Penn- 
 sylvania suffer? The public gain 
 would be obvious. Long-distance 
 travelers to local points on the Le- 
 high Valley, the West Shore, the 
 Lackawanna, the Erie, the Jersey 
 Central, the Reading, Baltimore 
 and Ohio — all these people would 
 have an infinitely more convenient 
 access to the trains they must take, 
 if these through trains started at 
 the Thirty-fourth street terminal. 
 Obviously the Jersey roads should 
 bear their proper proportion of 
 the fixed charges of such a joint 
 terminal. Their contributions 
 would be a financial relief to the 
 Pennsylvania. 
 
 [62] 
 
 All honor to the enterprise and 
 genius of the Pennsylvania's engi- 
 neers who conceived and built that 
 terminal. All respect to the man 
 that now heads the Pennsylvania 
 Railroad system. It is to broad, 
 public-spirited men like him that 
 the thinking public looks, in these 
 days, to hasten those adjustments, 
 to eliminate those competitive 
 wastes which, if uneradicated, will 
 feed the demagogy that will drive 
 us into government ownership of 
 the rail lines. Under any system 
 of pooling facilities the great, 
 strong roads like the Pennsylvania, 
 which have more cars, more locomo- 
 tives, better terminal facilities — 
 these roads, by contributing what 
 they have into the joint pool, must 
 inevitably make sacrifices. We 
 want to allow such a pooling of 
 revenue that there will be partial 
 compensation for these sacrifices. 
 But there can never be complete 
 compensation. The growing future 
 advantages which the preferred ter- 
 minal facilities promised to the big 
 roads will never be realized. Rail- 
 roads like the Pennsylvania, we 
 hope, are among the chief of those 
 property interests which will fore- 
 go something of the letter of their 
 legal rights in order to preserve 
 the spirit of the institution of 
 private property for the future. 
 The alternative to such concessions 
 is government ownership and 
 socialism. 
 
 This government in itself, in the 
 last analysis, is responsible for the 
 wasteful competition which the 
 railroads have pursued with each 
 other. Mr. Rea says truly: 
 
 As to co-operation, notwithstanding our 
 railroads have in the past been reared 
 on competition, and for most of the time 
 unreasonable competition, and that they 
 have been fairly compelled by state and 
 federal laws to compete, if such compul- 
 
sion be possible, they are today in times 
 of stress co-operating to a degree never 
 dreamed of and second to no other indus- 
 try, and serving their government nobly. 
 
 * v * # * 
 
 Suppose the railroad had undertaken 
 previous to the war to do what is pro- 
 posed as a war measure for the War Port 
 Board, i. e., pool the lighterage facilities, 
 and, with its local freight facilities and 
 other things, how far would they have 
 gotten under existing law, federal and 
 state? There is only one answer — such a 
 combination would have been condemned 
 and most of its officers would have been 
 in jail for violation of the law. 
 
 No one can gainsay that. But 
 ivhat confronts is a present situa- 
 tion, not a past wrong. The ques- 
 tion now is: Can the railroads to- 
 day, led by men like Mr. Rea — can 
 the railroads, taught to think in 
 terms of competition, quickly 
 change their habits of thought and 
 think in terms of cooperation? Can 
 they hasten evolution and give us a 
 truly national system of transpor- 
 tation under private ownership, or 
 must we instead have a revolution 
 and see Mr. Rea and his like re- 
 placed by the political railroad man- 
 agers?" 
 
 Other industries have indeed done 
 no better than the railroads, but the 
 quasi-public relationship does not so 
 
 visibly exist. As each war industry, 
 however, becomes perceptibly a war 
 factor there too must the public insist 
 upon broadminded wholly unselfish 
 bending to the national need at what- 
 ever cost. In Great Britain, five 
 thousand plants are under govern- 
 ment control. Individual plant pro- 
 duction and fixed investment have 
 been multiplied many fold. All have 
 met the government demands without 
 question as to final adjustment of 
 rights of stockholder or corporation. 
 The fundamental fairness of the En- 
 glishman and his government appear 
 to satisfy. Our Government has not, 
 in the opinion of many business men, 
 established its full claim to equal 
 confidence, but as a war measure the 
 public must enforce justice to avoid 
 financial or industrial upheaval of 
 dangerous proportions. 
 
 Employers have been threatened 
 with everything from confiscation to 
 ruinous taxation, to regulation and 
 restriction that have already produced 
 frequent bankruptcy; so formulation 
 of general principles relating to the 
 treatment of business, in order to ef- 
 fect that economic welfare upon which 
 alone heavy taxation must be based, 
 seems of great importance. 
 
 [63; 
 
XI 
 
 Fuel 
 
 A dramatic illustration of the failure 
 to obtain and use fundamentally im- 
 portant facts relating to war needs was 
 that furnished by the Fuel Adminis- 
 trator, Dr. Garfield. It will be remem- 
 bered that during the Fall, when the 
 coal famine first became visible, the 
 Fuel Administration insisted that there 
 was no shortage of coal. After a hur- 
 ried trip west, Dr. Garfield fortunately 
 came to a realization that the demand 
 for coal as a result of our war activi- 
 ties had greatly increased and that con- 
 clusions could no longer be drawn from 
 pre-war figures alone. With an in- 
 crease of demand between 10 and 20%, 
 the production which he calculated 
 would provide a surplus was discov- 
 ered to threaten a deficiency of at least 
 50 million tons. This is not intended 
 as a criticism of Dr. Garfield. He 
 entered upon his duties more handi- 
 capped than perhaps any other of the 
 war administrators. It was necessary 
 to improvise his entire organization 
 and almost immediately meet a situ- 
 ation which had long been growing 
 critical without any organized means 
 for controlling it. 
 
 For a long time to come, America 
 and her allies are going to suffer for 
 lack of preparation and the vision 
 which even as late as last Winter 
 could have saved innumerable delays 
 and their resultant sacrifice. Several 
 of these avoidable delays will be men- 
 tioned elsewhere. 
 
 The Fuel Administer began his du- 
 ties by endeavoring to increase the out- 
 put of the mines and to improve its 
 distribution. No apparent attention 
 was paid to conservation and preven- 
 tion of waste in the use of the fuel 
 already on hand and to be provided. 
 
 [ 
 
 The Patriotic Education Society last 
 Summer called the attention of the 
 leading American engineering socie- 
 ties to this gap, suggesting that as 
 their members were largely in their 
 daily work concerned with fuel econo- 
 mies it would seem as if those socie- 
 ties logically should become an impor- 
 tant factor in a nation-wide campaign 
 for fuel economy. This suggestion 
 was followed up by an investigation 
 of the existing committees, bureaus 
 and organizations that were at all in- 
 terested or active in that field and it 
 was discovered that every one was 
 anxious for recognition of this prob- 
 lem, realizing its importance and de- 
 siring to cooperate. This condition 
 was explained to the Fuel Administra- 
 tion, the Council of National Defense, 
 the United States Chamber of Com- 
 merce, engineering societies, to the 
 press; and for several months an in- 
 vestigator of the Patriotic Education 
 Society was constantly endeavoring to 
 co-ordinate the activities leading to 
 prevention of fuel waste. Finally the 
 Fuel Administration took the matter 
 actively in hand and various other 
 agencies are now effectively cooperat- 
 ing. 
 
 Encourage the Stokers 
 
 In Germany, stokers and firemen 
 are held responsible for prevention 
 of smoke, which means fuel waste. 
 In this country the factory owner 
 is held responsible, and the trade 
 unions have not done as much as 
 they could to assist him. It has, 
 therefore, been suggested to the 
 Fuel Administration that an ap- 
 peal to the stationary and locomotive 
 firemen and engineers of the country, 
 64] 
 
accompanied by conferences, drawing 
 public attention to the value of their 
 patriotic assistance in this matter and 
 in general a recognition which should 
 appeal to the individual, emphasizing 
 the importance of his personal contri- 
 bution to the cause, would be of great 
 value. An effort is being made at the 
 present time to carry on such a cam- 
 paign to stimulate the ship workers, 
 but little has yet been done to stir the 
 largest handlers of our coal supply. 
 
 New England, our chief munitions 
 producer, has been seriously handi- 
 capped by inadequate supplies of fuel, 
 this condition having been accentuated 
 by the competitive and sometimes un- 
 intelligent commandeering of tugs, 
 steamers, and barges, which formerly 
 delivered to New England three- 
 fourths of its entire coal supply. The 
 reduction of the water transportation 
 facilities increased the burden of the 
 already overloaded railroad system of 
 New England and the Middle States. 
 Why the Army, the Navy and the 
 Shipping Board should all have had 
 independent commandeering rights 
 must be a mystery to anybody who 
 knows the first principles of organ- 
 ization. 
 
 Is it not certain that adequate plan- 
 ning or control by superior authority 
 would have obviated the failure to use 
 tug, barge and small vessel build- 
 ing capacity of our shallow har- 
 bors and rivers? This single fail- 
 ure is now responsible for munition 
 factories being closed or run part 
 time, for unnecessary suffering from 
 cold in New England and the Middle 
 
 States, and worst of all, for criminal 
 delays of deep-sea tonnage in our 
 harbors because bunker coal cannot be 
 obtained. When the fate of the world 
 is hanging upon ship tonnage and we 
 are feverishly expediting ship build- 
 ing, think of vessels in service being 
 idle for lack of a little simple fore- 
 thought that would have required the 
 Shipping Board or some other agency 
 in spite of restricted powers to meet 
 this situation. What has been done up 
 to today to make amends for the 
 delay? 
 
 The scarcity of coal in Italy has 
 driven her vigorously to develop her 
 water powers, to burn wood in loco- 
 motives, to use inferior grades of fuel, 
 such as peat. Long ago the Patriotic 
 Education Society suggested that our 
 Federal Government investigate the 
 development of power at the coal mine 
 mouth and its transmission electri- 
 cally to factory and city to relieve the 
 railroads. Such power development at 
 the mines could readily be accompan- 
 ied by the production of coke, which 
 could be used to furnish steam power 
 or be used as coke in industry in case 
 it were found advisable to produce the 
 power locally through internal com- 
 bustion engines. A little co-ordinated 
 vision at Washington would have 
 caused the consideration of such prob- 
 lems months ago. Such central power 
 plants would be great factors in pro- 
 ducing toluol necessary for high ex- 
 plosives and of which we today lack 
 at least 50% of what we need, with 
 no immediate hope of a quick increase 
 of supply. 
 
 [65] 
 
XII 
 
 Imperfect Democracy vs. 
 Perfected Autocracy 
 
 Every business man knows that it 
 takes years to develop an effective bus- 
 iness organization. We are competing 
 with a nation which has for decades 
 developed its complex organization of 
 experts trained to collect and use facts 
 gathered from the corners of the 
 earth. The suggestion to develop 
 power at the coal mine mouth was re- 
 ceived in some instances by the re- 
 mark that the war would be ended 
 before that could be done. Who knows 
 when this war will end? Who today 
 can tell how our resources are to be 
 strained ? Who cannot say that defeat 
 and invasion of our own country can 
 be prevented only by utilizing to the 
 utmost of human ability every re- 
 source we possess? It is useless to 
 criticise individuals even where indi- 
 vidual fault is easily placed. America 
 is the victim of our national compla- 
 cency, the old belief that America com- 
 pared with other nations had super- 
 ability, super-organization powers. 
 
 In this uncertain world are we safe 
 in sharing unreservedly with Secre- 
 tary Baker the feeling that he ex- 
 pressed at Georgetown on June 5th?: 
 "I delight in the fact that when we en- 
 tered this war we were not, as our 
 adversary, ready for it, anxious for 
 it, prepared for it and inviting it. 
 On the other hand, accustomed to 
 peace, we were not ready." 
 
 Germany — A Nation of 
 Spoiled Children 
 
 At the end of our Civil War, with 
 a trained army of one million veterans, 
 the strongest armed force in the world, 
 
 we did not challenge our neighbors, 
 we did not run amuck, but in ninety 
 days most of those men were in their 
 homes. Why should we today have 
 faith in our ability to defend our 
 ideals and yet so distrust our integrity 
 of purpose as to fear military knowl- 
 edge among our -people? Germany 
 during the past century has fewer 
 years of war to her discredit than have 
 Great Britain, France or America. 
 
 Those who have to do with spoiled 
 children know that it is practically 
 impossible to change them. The Ger- 
 man military class produced a gener- 
 ation of teachers, who, as children, 
 were fed with distorted visions which 
 the rest of the world would call im- 
 moral. Those children grew up and 
 taught the next generation until there 
 has been organized in Germany an 
 entire nation of morally spoiled child- 
 ren. How can this war end until that 
 national immoral sense is subdued or 
 until it conquers the world? We may 
 have an early peace and leave it to 
 under perhaps still more desperate 
 conditions; but surely we have no right 
 to make any plans involving our na- 
 tional safety save on the basis of a 
 long and desperate struggle, involving 
 our utmost in unselfishness, efficiency 
 and resource. 
 
 Secretary Baker, according to the 
 Official Bulletin, issued by the Com- 
 mittee on Public Information, of June 
 21st, at a conference between cabinet 
 officers and editors of trade publica- 
 tions, said, "I am not asking you to 
 forbear criticism . . . Make your 
 criticism 'helpful and constructive. 
 
 . . . Point out the way to do it 
 
 [66 
 
right when you discover that it is be- 
 ing done wrong, and do not spare us 
 who are here charged with the respon- 
 sibility, if, after you have pointed out 
 the right way to do it we persist obsti- 
 nately in continuing to do it the 
 wrong way." Congress is now inves- 
 tigating the War and other depart- 
 ments in the spirit Secretary Baker 
 indicates. The public are just begin- 
 ning to realize that many things have 
 not been done as well as the gravity of 
 the situation required. The whole 
 nation desires to look backward, not 
 for the sake of mere criticism, but to 
 learn the lessons that we yet have time 
 to apply for our future safety. Many 
 of these lessons point to lack of fore- 
 planning, owing both to lack of vision 
 and to lack of accurate and compre- 
 hensive information upon which vision 
 must build to be serviceable. 
 
 Warnings Unheeded 
 The Council of National Defense, 
 from various directions, early received 
 warning regarding the dangers in- 
 volved in filling our Army and Navy 
 with volunteers or drafted men with- 
 out adequate provision for exemption 
 to protect our essential industries. In 
 spite of these warnings well over a 
 million men were withdrawn from in- 
 dustries before this lesson was heeded. 
 The enormous personnel and floor 
 space required to manage modern war 
 were illustrated to the Council of Na- 
 tional Defense by calling to their atten- 
 tion that the Royal Flying Corps in 
 Great Britain prior to the war occu- 
 pied seven offices and two years later 
 was using 375 rooms ; that the British 
 Ministry of Munitions in London had 
 commandeered a large hotel and in 
 addition occupied temporary buildings 
 in London and employed over 5,000 
 people in London alone. 
 
 When America entered the war, 
 the Advisory Commission of the 
 
 Council of National Defense, upon 
 which depended much of the ex- 
 pansion corresponding to that of the 
 British Ministry of Munitions, oc- 
 cupied one-half of one floor in one 
 office building in Washington. As the 
 Commission expanded under its war 
 burden other offices were gradually 
 added, but it was weeks later before 
 Secretary Baker visited the building, 
 saw the need and approved adequate 
 plans to house the Commissioners 
 and their staffs. Similar conditions ex- 
 isted in every rapidly expanding de- 
 partment last Spring. Early atten- 
 tion was called to the inadequacy of 
 Washington to house the army of vol- 
 unteers and new workers the govern- 
 ment would need. Today rents have 
 trebled, hotels are booked weeks ahead, 
 apartment houses are being command- 
 eered by the government and occu- 
 pants of years are being dispossessed. 
 Upon private initiative has fallen 
 much of the burden of meeting many 
 of these war emergencies. 
 
 Thousands of American profession- 
 al and business men have gone to 
 Washington full of patriotism offering 
 their services without cost to the gov- 
 ernment ; and many of them have gone 
 home sorely disillusioned. No central 
 information bureau where they could 
 even inquire where their individual 
 services might prove useful; no place 
 even to find out where to locate specific 
 individuals they might have had occa- 
 sion to interview. There was no com- 
 mittee or individual with adequate 
 authority, unhampered by detail work, 
 in a position to look ahead or to study 
 the gaps and overlapping activities in 
 the expanding organizations. That 
 weakness continues until the present 
 moment. To handle it adequately a 
 Planning Chief or Committee respon- 
 sible directly to the President would 
 seem to be essential. Through such a 
 mechanism condensed analyses of con- 
 
 fer; 
 
ditions could be presented for execu- 
 tive consideration and action. Weak- 
 nesses within departments could be 
 viewed from a national rather than 
 from a departmental angle. 
 
 The country must remember the 
 conflicting arrangements carried out 
 by Secretary Lane and Secretary 
 Baker in connection with fixing the 
 price of coal, indicating lack of co- 
 ordination, plans and policies among 
 cabinet officials. President Wilson 
 told the Governors, when they visited 
 the White House during their con- 
 ference early in May, that he was 
 spending a large part of his time 
 co-ordinating his executives. With 
 the burden of international problems 
 and other grave responsibilities, how 
 can the President be expected to give 
 adequate attention to the business 
 problem of "co-ordinating his execu- 
 tives" ? // he had an organizing assis- 
 tant, call him Secretary or give him 
 no title, in ivhom he had confidence 
 and who was supported by the author- 
 ity of the President in carrying out 
 investigations and obtaining informa- 
 tion upon which plans for the present 
 and future could be comprehensively 
 based, some of the complaint which is 
 yet rumored in Washington could be 
 eliminated. One often hears it said 
 that leading executives, whose prob- 
 lems can be settled only by decision of 
 the President, are frequently delayed 
 days at a time in obtaining an audi- 
 ence with him. Real co-ordination of 
 executives in a comprehensive way 
 would seem in these critical times to 
 require daily contact and daily deci- 
 sions. This is true for success in 
 business, epecially when that business 
 is of an aggressive, expanding charac- 
 ter. 
 
 No Matured Plans 
 
 Many students of organization have 
 long since come to the conclusion that 
 
 the two weakest parts of our entire 
 national war effort lie at the very 
 top of our executive mechanism, — one 
 right next to the President and the 
 other just below his executive chiefs. 
 If the story can ever be written, the 
 unselfish patriotism of business men 
 in trying to live up to the spirit of 
 the national need without complaint, 
 under conditions avoidably onerous, 
 will excite general admiration. Many 
 proclamations have been put into effect 
 before underlying policies were either 
 worked out or expressed, before ade- 
 quate organization or mechanism or 
 even plan had been created to carry 
 them out. Export and import restric- 
 tions, priority rulings, commandeering 
 of transportation facilities, price reg- 
 ulations are illustrations of these 
 difficulties. 
 
 When General Crozier recently ad- 
 mitted before the Congressional inves- 
 tigating committee that the only prep- 
 aration of his department for war 
 prior to our entry was the prepara- 
 tion of a card index, it is indeed 
 not surprising that our getting into 
 war unprepared was very comprehen- 
 sively carried out. It is perhaps the 
 one thing that we have done thor- 
 oughly. 
 
 The original Naval Consulting 
 Board, the Council of National De- 
 fense and its Advisory Commission 
 have all been useful educational fac- 
 tors and as such have doubtless mini- 
 mized mistakes and delays. 
 
 It may be interesting to quote in re- 
 view several bulletins of the Chamber 
 of Commerce of the United States, all 
 of which bear upon the subject of 
 organization and coordination. 
 
 Bulletin No. 22 of October 1st is a 
 dignified expression that business 
 America expects constructive leader- 
 ship from its government: 
 
 [68; 
 
The Duty the Government 
 Owes Business in War 
 
 "The duty Business owes the Govern- 
 ment in War has been clearly- 
 stated. Business must 'dedicate to 
 the Nation every facility it has de- 
 veloped and every financial resource 
 it commands on such terms and un- 
 der such circumstances as our Gov- 
 ernment shall determine to be just.' 
 Business owes the duty to submit 
 unhesitatingly to such regulation 
 and control by the Government as 
 may be necessary to concentrate the 
 industrial resources and energy of 
 the country toward winning the 
 war. 
 
 The duty which the Government 
 owes Business is equally clear. The 
 Government owes Business the duty 
 of wise and constructive leadership. 
 The control over Business carries 
 with it the responsibility that the 
 control be exercised in a manner 
 to produce the results desired 
 and to impose no unnecessary hard- 
 ship. 
 
 When the Government says what 
 business shall be done, what prices 
 shall be charged, and how produc- 
 tion shall be distributed, there is 
 created a new system of production 
 and distribution and there is 
 brought to an end the old system 
 understood by business men — i. e., 
 the system of production and dis- 
 tribution by price. The new sys- 
 tem must be developed quickly to 
 replace the system no longer in ef- 
 fect and this new system must be 
 made clear to business men so that 
 they may know each day how to 
 meet the problems of business. 
 
 What Business may do to help 
 win the War is being determined by 
 the Government. Concentration of 
 industrial energy and resource will 
 
 come about to the full extent only 
 if the Government affords the nec- 
 essary leadership. 
 
 In meeting this great responsi- 
 bility the Government can command 
 the full help and assistance of Bus- 
 iness. Side by side the problem may 
 be worked out in mutual cooperation. 
 With the full power to compel any 
 business man to put aside all selfish 
 desire, the Government may forget 
 the controversies of the past and 
 have the benefit of all helpful knowl- 
 edge and experience of Business. 
 The struggle of the Nation brings 
 about a common purpose and in cre- 
 ating the conditions under which 
 business is to be done during the 
 War, the Government can use with- 
 out reservation the services of men 
 who know business, its infinite 
 ramifications, its delicate sensitive- 
 ness. 
 
 Business says to the Government 
 "your buying of vast quantities of 
 war supplies, your control of prices 
 and distribution, create a new world 
 for business. Not a moment is to 
 be lost in clearing up the situation 
 by giving us full knowledge of the 
 new system of production and dis- 
 tribution upon which our very bus- 
 iness life depends." 
 
 Business suggests to the Govern- 
 ment as a means to clear up the sit- 
 uation that the purchasing of war 
 supplies be under one control and 
 that the fixing of the prices and 
 distribution be made quickly and 
 without hesitation and according to 
 declared methods and principles. 
 Furthermore, Business suggests 
 that each industry form a commit- 
 tee to speak to the Government for 
 that industry, so that when the Gov- 
 ernment desires to act those affected 
 will be heard, and after action mis- 
 takes may be promptly corrected. 
 In this manner full cooperation 
 
 [69; 
 
between the Government and Busi- 
 ness can be quickly brought about. 
 These are merely suggestions. 
 The duty of leadership is upon the 
 Government." 
 
 War Bulletin No. 27 issued October 
 30th tactfully hints at disappointment 
 over the government's methods of 
 price control and distribution and 
 makes helpful suggestions for im- 
 provement : 
 
 Price Control and 
 Distribution 
 
 "The recommendations of business men 
 through the Chamber of Commerce 
 of the United States that the gov- 
 ernment during the war control 
 prices, production and distribution 
 under certain circumstances, make 
 it desirable to consider the nature 
 and extent of what has already 
 been done by the government in 
 this direction. 
 
 Purposes of Control 
 
 Control of prices by the govern- 
 ment may be for the following pur- 
 poses : 
 
 1. To enable the goverment or the pub- 
 lie, or both, to purchase at prices 
 below those established by market 
 conditions ; 
 
 2. To substitute for the ordinary 
 method of distribution by price a 
 method of distribution of product 
 on a basis of the country's require- 
 ments in connection with the prose- 
 cution of the war; 
 
 3. To prevent the making of large prof- 
 its out of the war and thereby, 
 among other things, eliminate a 
 cause of great discontent on the part 
 of labor. 
 
 Prices Dealt With 
 
 Our government has fixed prices 
 on copper, steel, coal, coke and pig- 
 iron. In these cases, the prices to 
 the public and to the Allies have 
 been the same as that to our gov- 
 
 ernment, and the prices have been 
 substantially below those prevailing 
 in the market at the time. There- 
 fore, the control of these prices by 
 the government has accomplished 
 the first of the three purposes in- 
 dicated above. 
 
 Distribution 
 
 There has not, however, been es- 
 tablished thus far in any case a 
 method of distribution in connection 
 with the control of prices. Priority 
 on specific orders has been granted, 
 but no general effort has been made 
 to distribute production among 
 those whose requirements are most 
 urgent, considered from the stand- 
 point of national defense. In fact, 
 the activity of the Priority Commit- 
 tee of the War Industries Board has 
 thus far been confined almost en- 
 tirely to the granting of priority on 
 government orders. No general 
 rules of distribution have been laid 
 down. No announcement has been 
 made of a classification of essential 
 and non-essential industries. Prior- 
 ity decisions are still made on the 
 merit of the particular application 
 and not on the thoroughgoing con- 
 sideration of the general require- 
 ments of industry. This makes it 
 quite evident that, up to the present 
 time, the government has not at- 
 tempted to accomplish purpose num- 
 ber two of the above classification. 
 
 Level of Prices 
 
 In the next place, wherever prices 
 have been fixed by the government 
 consideration has been given to the 
 necessity of stimulating production 
 and prices have been established at 
 a sufficiently high level to accom- 
 plish this purpose. This has, of 
 course, produced high prices and 
 has in a large number of cases re- 
 sulted in large profits — far beyond 
 
 [70] 
 
those earned in normal times. The 
 fixing of prices has not been accom- 
 panied by an arrangement under 
 which excess earnings are paid into 
 the public treasury — some such ar- 
 rangement as that which has been 
 adopted in England in connection 
 with the "controlled" plants, as set 
 forth in War Bulletin No. 14. In 
 removing the discontent of labor at 
 high war profits, taxation, because 
 of its remote application, is unsat- 
 isfactory, even when directed at war 
 profits, and such a general taxation 
 measure as that recently passed by 
 Congress is less effective. 
 
 Elements in Situation 
 
 Therefore, as large profits are be- 
 ing made even in industries where 
 the government has fixed prices, the 
 govenment has not yet been able to 
 enter upon the accomplishment of 
 the third of the purposes above set 
 forth. 
 
 It is not unnatural that the gov- 
 ernment should proceed slowly and 
 hesitatingly with such unprece- 
 dented action as the control of prices 
 and distribution. The very magni- 
 tude of the undertaking restrains 
 the vigor and energy which would 
 characterize the effort to solve a less 
 difficult problem. In any event, 
 however, success is only relative 
 and in the early stages may be lost 
 sight of entirely because of unavoid- 
 able confusion. 
 
 This makes it all the more im- 
 portant to distinguish between 
 the results of partial effort which 
 does not even endeavor to secure full 
 results and those of thoroughgoing, 
 well-developed effort. When the 
 government has not endeavored to 
 establish a new method of distribu- 
 tion to take the place of distribu- 
 tion by price even in the instances 
 
 where the government has con- 
 trolled prices and where direct ef- 
 fort is not made to prevent the 
 earning of large profits where prices 
 have been fixed, it is not to be ex- 
 pected that production will be dis- 
 tributed on the best basis for the 
 national defense or that discontent 
 on the part of labor will be avoided. 
 
 Difficulties to Be Avoided 
 
 In some respects the first at- 
 tempts of the government at price 
 control have been such that most 
 business men will regard disappoint- 
 ment or failure as inevitable. To 
 business men any fixing of prices to 
 a vast multitude of users is an un- 
 dertaking of almost insurmountable 
 difficulty and absolutely hopeless if 
 not accompanied by some method of 
 distribution. 
 
 Where no mechanism is developed 
 to take the place of distribution by 
 price, and nevertheless an effort is 
 made to control retail prices of a 
 product in urgent demand, there 
 will be of necessity wholesale at- 
 tempts at evasion. The man whose 
 house is cold endeavors to induce a 
 dealer to secure coal for him by 
 making gifts (often in the form 
 of wagers) or by purchasing arti- 
 cles of no value. Similar conditions 
 have produced the same experience 
 for many hundreds of years. 
 
 General Basis for Prices 
 
 There has not been developed as 
 yet a clear policy with regard to 
 securing the assistance of business 
 men in connection with the control 
 of prices. In some cases the gov- 
 ernment has called upon those in- 
 terested in a business to participate 
 in the actual fixing of the prices. 
 This has resulted in a fixing of 
 prices by negotiation — which is 
 
 [71 
 
clearly harmful. In the judgment 
 of the undersigned Committee, men 
 elected by an industry to represent 
 it should be called upon by the gov- 
 ernment for full information which 
 would be helpful in fixing prices, 
 but the actual determination of the 
 price should be a semi-judicial 
 function. 
 
 This means that wherever prices 
 are determined by the government 
 it is essential that such prices 
 should be arrived at according to 
 some general plan and upon a defi- 
 nitely declared basis. Such general 
 principles should be followed so far 
 as possible wherever the govern- 
 ment acts to control prices and 
 would serve as a yardstick or 
 standard between different indus- 
 tries. 
 
 In other cases the government has 
 not consulted business men but has 
 conducted independent investiga- 
 tions and announced prices without 
 giving any information as to the 
 basis on which such prices were 
 reached. This necessarily creates 
 antagonism on the part of business 
 men who are unaccustomed to auto- 
 cratic control, and prevents the co- 
 operative response which might be 
 expected from business men if they 
 had a clear understanding of what 
 was being done. 
 
 Actual Conditions 
 
 Knowledge of actual conditions 
 existing in business in its intricate 
 ramifications can be acquired only 
 by years of intimate contact. In 
 the judgment of business men it is 
 essential to success in government 
 control of prices and distribution to 
 establish a basis upon which this 
 knowledge and information of bus- 
 iness men can be at the service of 
 the government under such circum- 
 
 [72 
 
 stances as not to be influenced by 
 selfishness or the need of self-pro- 
 tection. 
 
 Success in price control is to be 
 expected only where made in con- 
 nection with distribution and when 
 the attempt is made as near as pos- 
 sible to the source of supply; also 
 when advantage is taken of such 
 helpful aids as the control of rail- 
 way transportation; and further- 
 more when the government has the 
 assistance of business men of knowl- 
 edge and experience, furnished on 
 a disinterested basis and under such 
 circumstances as to bring about co- 
 operation in the industries which 
 such men represent." 
 
 Evidently the great industries 
 have not been utilized in such a way 
 as to furnish the greatest assistance 
 to the government with the minimum 
 of disturbance to the industry. This 
 condition is known to most business 
 men who have been in touch with con- 
 ditions in Washington and again il- 
 lustrates the importance of carefully 
 planned policies based upon the most 
 expert information and assistance ob- 
 tainable, applied under conditions free 
 from the objections and criticisms 
 which have been possible owing to 
 some of the relations existing between 
 government and producer. 
 
 An Englishman in this country to 
 purchase supplies for his government 
 stated that he was officially told to see 
 a certain individual in order to pur- 
 chase a certain commodity, this indi- 
 vidual being described as the govern- 
 ment representative. This particular 
 individual was the head of a company 
 which had a virtual monopoly of that 
 commodity and therefore was both 
 monopolistic seller of that commodity 
 and United States government repre- 
 sentative at the time he was negoti- 
 ating with this English official pur- 
 
chasing agent. "In no other country 
 in the world," remarked the English- 
 man, "would such an anomalous con- 
 dition be permitted to exist." 
 
 Apply Important Principles 
 
 As great confusion seems likely to 
 occur in connection with our priority 
 problem for a long time to come, we 
 venture to quote in full War Bulletin 
 No. 10 of the Chamber of Commerce 
 of the United States issued August 
 3rd, 1917: 
 
 Priority in England 
 
 "While Judge Lovett and the War In- 
 dustries Board are determining 
 what is to be done in this country 
 regarding priority, it may be well 
 to present to business men a state- 
 ment of what has been done in En- 
 gland toward solving this problem 
 as it exists there. 
 
 British Priority Department 
 
 The Priority Department is un- 
 der the Ministry of Munitions of 
 War and has been gradually devel- 
 oped from an informal committee 
 that was constituted in September, 
 1915, over one year after the war 
 started. Before that time questions 
 of priority were determined, if at 
 all, by conference between the inter- 
 ested government departments. In 
 this connection it may be well to re- 
 call that the Ministry of Munitions 
 of War was not established until the 
 Act of June 9th, 1915, was passed. 
 
 Representative Character 
 
 When the Priority Committee 
 was organized it consisted of repre- 
 sentatives of a few of the depart- 
 ments of the Ministry of Munitions 
 of War. From time to time the 
 membership has been increased un- 
 
 til it now numbers at least a score 
 who represent, not only the impor- 
 tant departments of the Ministry — 
 such as guns, small arms, gun am- 
 munition, small arms ammunition, 
 machine tools, raw materials, labor 
 supply, etc. — but also the Admi- 
 ralty, the railway department, India 
 Office, War Office, contract depart- 
 ment, Post Office, the Office of 
 Works and lastly — of much impor- 
 tance — the Board of Trade. The 
 Board of Trade is expected to rep- 
 resent the interest of private in- 
 dustry. The broad principle has 
 been followed of having represented 
 on the committee every interest 
 which should be considered in de- 
 termining questions of priority. 
 
 Procedure 
 
 The committee meets every day 
 and no priority can be granted un- 
 less all present agree. One objec- 
 tion rejects an application — but 
 such decision is not final. The rep- 
 resentative of the interested depart- 
 ment may withdraw the application 
 and refer the matter through the 
 chief of his department to some one 
 representing the Minister of Muni- 
 tions, who is the final authority — 
 for example, to the assistant secre- 
 tary of the Ministry. It is stated 
 that in practice the number of cases 
 in which the action of the commit- 
 tee has not been accepted as final 
 has been remarkably few. 
 
 Origin of Cases 
 
 At the outset and for five or six 
 months the Priority Committee 
 acted only on cases presented to it 
 by the government departments or 
 by manufacturers. It gradually be- 
 came clear that these cases repre- 
 sented only a fraction of what the 
 committee could do with advantage. 
 
 [73] 
 
Therefore in March, 1916, there 
 was issued an order which became 
 famous in the English industrial 
 world as "Circular L 33." This 
 created the semi-automatic machin- 
 ery under which a manufacturer 
 instructed as to priority by the com- 
 mittee could himself issue certifi- 
 cates to bring about similar prior- 
 ity on materials or sub-contracts 
 for his contract. 
 
 Classification of Work 
 
 "Circular L 33" was revised on 
 March 8th of this year and now by 
 order of the Minister of Munitions 
 all persons engaged in certain indus- 
 tries have their work divided into 
 three classes — A, B and C. A is 
 war work, B other work of national 
 importance, and C is all work not 
 comprised in A or B. 
 
 Class A comprises work or ma- 
 terial wholly required as a compo- 
 nent part of any work or goods to be 
 carried out or supplied under : 
 
 (A) A government war contract which 
 signifies : 
 
 1. Any contract placed by the Ad- 
 miralty, the War Office, or the 
 
 Minister of Munitions. 
 
 2. Any contract for naval or military 
 equipment placed by an allied 
 government by or with the consent 
 in writing of the Admiralty, the 
 War Office, or the Minister of 
 Munitions. 
 
 ( B ) Certified war work which signifies : 
 
 1. Work on a contract or order which 
 the Admiralty, the War Office, or 
 the Minister of Munitions has 
 certified in writing to be war or 
 munition work. 
 
 2. Work which the Minister of Muni- 
 tions has directed to be treated 
 on an equality with war work. 
 
 (C) Merchant shipping work certified 
 in writing by the Board of Trade 
 to be munitions work. 
 
 War Contracts 
 
 The Priority Committee grants 
 priority in Class A as follows : 
 
 1. Most urgent war work. 
 
 2. Very urgent war work. 
 
 3. Urgent war work and 
 4. War work. 
 
 In addition there is an emergency 
 classification which takes prece- 
 dence over all. The following quo- 
 tations indicate the nature of the. 
 instructions issued: 
 
 "The orders or contracts given below 
 are such urgent war work that they should 
 take precedence of all other work you 
 have on hand, and all your available and 
 applicable resources of labor and machin- 
 ery should be concentrated on completing 
 them. This special emergency instruction 
 places the orders or contracts in front of 
 all ordinary grades 1, 2, 3, 4 in Class A 
 War Work." 
 
 "Priority Instruction 2 — The orders or 
 contracts given below are Veiy Urgent 
 War Work and should rank on an equality 
 with other Very Urgent War Work which 
 you have on hand; and all available and 
 applicable labor and machinery not en- 
 gaged on other equally urgent war work 
 should be employed on completing them." 
 
 Certified War Work 
 In connection with Class B. prior- 
 ity is granted in Class 5, but only 
 as regards Class B or C work. This 
 makes two groups under B, i. e., In- 
 struction 5 and other Class B. 
 
 Delegated Authority 
 Ordinarily under Class C no cer- 
 tificates are issued, as this work 
 follows A and B, but in some cases 
 preference is noted in Class C which 
 gives rise to the following illumi- 
 nating instruction : 
 
 "Priority Instruction 6 — On the infor- 
 mation at present available, the orders or 
 contracts given below are not regarded 
 as war work; or as necessary for the 
 efficient conduct of the war, but these 
 orders or contracts may be undertaken 
 subj ect to the following conditions : — first, 
 that the work thereon shall not be permit- 
 ted to delay or interfere, directly or indi- 
 rectly, with any war work or be taken as a 
 sufficient reason for not understanding any 
 future orders for war work direct or 
 indirect which may be offered you; second, 
 the present permission shall not be relied 
 on as an objection to labor being removed 
 from your works should the necessity of 
 
 [74] 
 
doing so arise. Orders or contracts under 
 Priority Instruction 6 should be executed 
 in priority to other orders in Class C." 
 
 Where priority is granted to any manu- 
 facturer he automatically has authority to 
 issue certificates to all supplying him with 
 materials for the work in question which 
 grant the same priority on such materials. 
 
 The Priority Committee closely 
 supervises the use of this authority 
 and reverses a priority certificate 
 granted by the manufacturer when- 
 ever the action of the manufacturer 
 appears to the Priority Committee 
 not to be justified. Oh an elaborate 
 form the Committee secures infor- 
 mation from a manufacturer issu- 
 ing certificates as to the grounds 
 on which certificates were issued. 
 
 Industries Affected 
 
 The industries affected by the 
 Priority Committee are as follows: 
 
 All trades and manufacturers in or ol 
 metals, machinery, agricultural imple- 
 ments and vehicles. 
 The repairing of machinery or plant for 
 
 use in Industry. 
 Woodworking. 
 Pottery and Glass Trades. 
 Buildings and Works of Construction. 
 Textile Trades and Manufacture. 
 Linoleum, Oilcloth and Table Baize Man- 
 ufacture. 
 Rope, Twine and Line Trades and Manu- 
 facture. 
 Coal Tar Products, Manufacture of. 
 Dyestuffs, Manufacture of. 
 Other Chemical Products, Manufacture 
 
 of. 
 Lubricating Oils, and other Lubricants, 
 
 Manufacture of. 
 Oil Seed Crushing. 
 Soap and Candles, Manufacture of. 
 Fertilizers, Manufacture of. 
 Paints, Colors and Varnishes, Manufac- 
 ture of. 
 Baskets and Wicker Work, Manufacture 
 
 of. 
 Letterpresses and Lithographic Printing. 
 Papermaking. 
 
 Leather Trades and Manufacture. 
 Boot, Shoe and Clog Manufacture. 
 Coke, Manufacture of. 
 Rubber Trades and Manufacture. 
 Waterproofing of Fabrics of Paper. 
 Electricity, Gas andWater Services. 
 Stone, Marble, Granite, and Slate Quarry- 
 ing, Cutting and Polishing. 
 Bookbinding. 
 
 Orders Not Compulsory 
 
 The manufacturer is not com- 
 pelled to accept work from the gov- 
 ernment, and when a manufacturer 
 accompanies an order to another 
 manufacturer, with a certicate 
 which would entitle this order, if 
 accepted, to priority, the manufac- 
 turer to whom the order is tendered 
 need not accept the order unless he 
 desires to sell. There is, however, 
 strong indirect pressure to accept 
 priority orders, because a priority 
 order gives assurance that steel and 
 other scarce raw materials may be 
 secured, that transportation will be 
 afforded, and also that a plant en- 
 gaged upon priority work will have 
 an adequate supply of labor. 
 
 Orders Regarding Materials 
 
 The Priority Committee issues 
 orders from time to time that no 
 scarce material shall be used except 
 on Class A work or Class A and B 
 work. For example, an order has 
 been issued that copper, whether 
 wrought or unwrought, should be 
 used only for work on Class A or 
 B, and at one time an order was 
 issued that spelter should not be 
 used except in Class A work, or for 
 the purpose of necessary repairs or 
 renewals involving the use of not 
 exceeding 1 cwt. of spelter. 
 
 Reports of Supplies 
 
 The steel controller receives 
 weekly reports from rolling mills 
 giving the schedule of rollings, ac- 
 tual rollings, the shipments, and of 
 great importance, a statement of 
 reasons for retarded output. The 
 reports require the name of each 
 customer and of the priority class 
 in which the order is entered. The 
 Priority Committee thus has actual 
 control over all work done in the 
 
 [75] 
 
steel business. Reports are re- 
 quired of all stocks in Great Britain 
 of certain listed scarce material, 
 and from time to time the Minister 
 of Munitions takes possession of 
 all stocks of certain character. This 
 has been done with regard to brass, 
 brass scrap, copper and copper ore, 
 etc. 
 
 Suggestions to Manufacturers 
 
 The Priority branch of the Min- 
 istry of Munitions of War issues 
 such notices as : 
 
 "Please note that no corrugated sheeting 
 is available for general or export pur- 
 poses. It can only be obtained for direct 
 war work . It is, therefore, only a waste 
 of time to apply for permission for other 
 purposes. Steel, Brass and Copper also 
 can be supplied only for war work, or 
 for maintaining essential National Indus- 
 tries." 
 
 From time to time the Priority 
 branch requests of the manufac- 
 turer a list of all of his orders, giv- 
 ing customer's name, and full par- 
 ticulars, including what proportion 
 of the work remains to be done. As 
 indicating the existing attitude to- 
 ward Class C work, it is stated 
 Class C contracts need not be given 
 in detail, but their number and total 
 value should be stated. 
 
 The following request is of inter- 
 est: "In order that it may be pos- 
 sible to ascertain roughly whether 
 you have so many orders in hand in 
 Class A that you are not able to 
 make progress with orders of Class 
 B or C, you are requested to indicate 
 approximately the number of orders 
 on j'-our books not begun or not yet 
 completed but to give an indication 
 in some other form most convenient 
 to you, which would render it pos- 
 sible to form an estimate of your 
 ability, with the labor, plant and 
 the materials available, to execute 
 at the present time B and C classes." 
 
 Coal Distribution 
 
 The Comptroller of Coal Mines of 
 the Board of Trade has recently is- 
 sued an order that, effective at 6 
 P. M. September 8th, 1917, all coal 
 contracts are to be abrogated. 
 Thereafter, each coal-producing 
 district may sell coal only for deliv- 
 ery in certain stipulated areas. It 
 is stated that this is done : 
 
 1. "That consumption of coal should 
 take place as near the producing 
 point as possible." 
 
 2. "That in view of the supply facilities 
 afforded by the main trunk lines, the 
 movements of traffic should follow 
 these routes wherever possible." 
 
 3. "That the movement of coal should, 
 as far as possible, be in well defined 
 directions: viz.: north to south, north 
 to southwest, north to southeast, east 
 to west." 
 
 4. "That an area producing less coal 
 than suffices for its own need should 
 not send any portion of its coal to 
 other areas. That an area producing 
 more coal than it requires for the 
 consumption within the area itself, 
 should distribute the balance to 
 adjacent or convenient areas." 
 
 The Comptroller of Coal Mines 
 estimates that this arangement will 
 effect a saving of 700,000,000 ton- 
 miles in the transportation of coal 
 by the railways. 
 
 General Purposes of Priority 
 
 The above illustrations indicate 
 that the Priority branch of the Min- 
 istry of Munitions has for its func- 
 tions to bring about harmonious 
 action between the conflicting de- 
 mands of the different departments 
 of the Ministry of Munitions, of the 
 Admiralty, the War Office and other 
 government offices, the railroads, 
 the mines and other quasi-public 
 service and approved industry. 
 
 All these different public inter- 
 ests are in more or less active com- 
 petition among themselves for their 
 share of raw material, manufactur- 
 ing capacity, and labor of the coun- 
 
 r/76] 
 
try. The Priority Committee has 
 been created in recognition of the 
 fact that the decision between these 
 several interests cannot be left in 
 war-time to the uncontrolled opera- 
 tion of prices. 
 
 The work of the Priority Com- 
 mittee has been the consideration of 
 definite concrete problems. Recent- 
 ly, a small committee has been 
 formed to meet occasionally and 
 formulate general principles. This 
 procedure first to meet conditions 
 and then develop comprehensive 
 principles is noteworthy." 
 
 Seek General Principles 
 
 The final paragraph of this bulletin 
 deserves particular emphasis. It points 
 out that in connection with the Brit- 
 ish Priority Committee work, a small 
 committee has been formed to meet 
 occasionally and formulate general 
 principles. Extreme criticism against 
 our American methods is warranted 
 on the basis that many of our efforts 
 are spasmodic and detached. Our con- 
 stant aim should be to look for gen- 
 eral principles. In fact, we need a 
 Herbert Spencer. 
 
 As suggesting an important im- 
 provement in our war purchasing 
 mechanism, some of the resolutions 
 adopted at the War Convention held 
 in Atlantic City in September by 
 American business men are worth 
 quoting : — 
 
 "Whereas, It is the spirit of 
 American Business that however 
 fundamental may be the change in 
 the relation of Government to Bus- 
 iness, the Government should have 
 the power during the period of the 
 war to control prices and the distri- 
 bution of production for public and 
 private needs to whatever extent 
 may be necessary for our national 
 purpose; be it 
 
 Resolved, by the representatives 
 of American Business met in War 
 Convention, That all war buying 
 should be assembled under the con- 
 trol of one Board or Executive De- 
 partment ; and be it further 
 
 Resolved, That this war supply 
 board or department should be 
 given full power to procure war 
 supplies to the best advantage to 
 the Government as to price, quality 
 and delivery and in a way to main- 
 tain essential industrial life with- 
 out disturbing social and economic 
 conditions; including the power to 
 fix prices not only to the Govern- 
 ment but to the public on essential 
 products and to distribute output 
 in a manner to promote the nation- 
 al defense and the maintenance of 
 our industrial structure." 
 
 Germany, according to Edward N. 
 Hurley, then Chairman of the Federal 
 Trade Commission, long ago had 85% 
 of her commerce and industries repre- 
 sented by trade and commercial organ- 
 izations. These were fostered by the 
 Imperial Government and formed an 
 important link in the chain of imperial 
 commerce and industry. The long- 
 standing distrust of American busi- 
 ness men and financiers on the part of 
 the public and our government has in- 
 creased our difficulty in using our 
 existing trade and commercial organ- 
 izations to the utmost advantage in 
 prosecuting the war. It is to be hoped 
 that this condition will rapidly dis- 
 appear, because events have proven 
 that every class in our social and in- 
 dustrial mechanism has been open 
 to praise for its unselfishness and 
 condemnation for its profiteering ten- 
 dencies. The small salaried worker of 
 the country has suffered most through 
 increase in the cost of living, and it 
 seems probable that the workingman 
 has obtained greater reward from the 
 
 [71 
 
general upheaval than has the average 
 business man with comparatively few 
 exceptions. Unfortunately, these ex- 
 ceptions are in the public eye and the 
 vastly greater number of unfortunates, 
 many of whom are producing the non- 
 essentials, is overlooked. 
 
 As it seems likely that we shall be 
 slow compared with Great Britain in 
 eliminating the production of luxuries, 
 the official utterance of the United 
 States Chamber of Commerce on this 
 subject is entitled to consideration: 
 
 Non-Essential Business 
 
 "Business men everywhere are 
 wondering what is non-essential 
 business. This Committee is re- 
 ceiving many inquiries as to the 
 manner in which this will be deter- 
 mined by the government and what 
 course will be followed in withdraw- 
 ing labor and materials from such 
 industries as may be regarded as 
 non-essential during the war for the 
 necessities of industries essential to 
 the war. 
 
 No policy in this connection has 
 been announced by the government 
 and the above questions cannot be 
 answered. When the occasion 
 arises, what should be done seems 
 clear to this Committee. No action 
 except emergency action should be 
 taken, except in accordance with 
 some general plan based upon a 
 thorough survey of industry, which, 
 no doubt, has already been made. 
 If unnecessary hardship is to be 
 avoided, if there is to be no discrim- 
 ination, the government should not 
 act until a general plan has been 
 formulated and made known to the 
 business of the country. 
 
 Before a business is classified as 
 non-essential and deprived by act of 
 government of labor and materials, 
 the industry through duly elected 
 
 [78] 
 
 representatives should be given an 
 opportunity to discuss the matter, 
 and to learn the premises of the 
 government and the reasons for 
 action. The motive of the govern- 
 ment, — the concentration of indus- 
 trial energy toward winning the 
 war, — appeals to all, and every in- 
 dustry can be relied upon to assist 
 in bringing itself into adjustment 
 with the war needs of the country. 
 
 As has been frequently pointed 
 out in these Bulletins, if the govern- 
 ment acts in this connection with 
 sufficient dispatch, the industries of 
 the country may be given an oppor- 
 tunity to meet the needs of the emer- 
 gency in a gradual manner and 
 after deliberate planning. With 
 English experience as a guide, and 
 with the unhesitating support which 
 business has given to the govern- 
 ment in the national effort, full 
 opportunity is afforded for delib- 
 erate planning and adjustment. 
 
 Where an industry is regarded as 
 non-essential and must be deprived 
 of labor and materials, such deliber- 
 • ate planning may lead to the use of 
 substitute materials or different 
 processes of production. In this 
 manner, unnecessary hardship may 
 be avoided. 
 
 It should be a cardinal principle 
 that the normal structure of busi- 
 ness should be maintained during 
 these abnormal times as far as 
 possible. Therefore, consideration 
 should be given to the possibility of 
 allowing non-essential business a 
 proportion of its requirements of 
 labor and materials, so that some 
 organization may be retained to be 
 developed again upon the return of 
 peaceful conditions. 
 
 Furthermore, when the govern- 
 ment is forced to deprive a business 
 of materials and labor because it is 
 non-essential, an effort should be 
 
made by the government to place 
 with the industry orders for product 
 needed in the war. In this manner 
 a helping hand may be given to bus- 
 iness suffering solely through sacri- 
 fice for the common good. In this 
 same connection it may be said that 
 if men are to be withdrawn from 
 industrial communities where they 
 have houses and gathered in manu- 
 facturing centers already congested, 
 there is created a great housing 
 problem in connection with the pro- 
 duction of war supplies. But if in 
 placing war orders effort is made to 
 produce war supplies in the centers 
 where labor is housed, not only will 
 congestion in munition centers be 
 relieved, but there will be avoided 
 at the end of the war the great 
 problem of moving labor back to the 
 normal producing centers. 
 
 One of the reasons for suggesting 
 the formation of War Service Com- 
 mittees in industries was to bring 
 about an early consideration of the 
 above problems and to direct the 
 attention of industries to the need 
 in these abnormal times of prepar- 
 ing for diversified or unusual pro- 
 duction to keep the industries intact 
 during the war. Such committees 
 could effectively present to govern- 
 mental authorities the manner in 
 which industries might conform to 
 war-time conditions. In a democ- 
 racy it is certainly far better for 
 industries to become adjusted to 
 new conditions by cooperation be- 
 tween the industries and the govern- 
 ment rather than by compulsion of 
 drastic and unprecedented govern- 
 ment action." 
 
 Foster Trade Organizations 
 Every thinking man agrees that our 
 national welfare demands the transi- 
 tion from peace to war activities" with 
 a minimum of interruption to our 
 
 economic prosperity, individual, corp- 
 orate, and national. A great factor in 
 this must be the intelligent use of 
 trade organizations and experts. Prob- 
 ably the greatest service that the 
 National Chamber of Comerce could 
 perform for the country and the serv- 
 ice most closely allied to its past activ- 
 ities lies in the effective creation, 
 organization and utilization of its pro- 
 posed war service committees. Inval- 
 uable should be the aid of such com- 
 mittees in studying and assisting in 
 the control of the ebb and flow of 
 labor, the study of essential welfare 
 problems, furnishing authentic inform- 
 ation regarding productive facilities 
 and processes, supplies of raw mate- 
 rials, increasing the educational value 
 of trade journals, costs, distributing 
 problems, and, in fact, all of the im- 
 portant industrial problems which yet 
 remain imperfectly solved. 
 
 Says the Chamber of Commerce 
 War Bulletin No. 24 of October 8, 
 1917: 
 
 Organization of Business 
 
 Election of War Service Committees 
 
 "The discussions at the War Con- 
 vention of American Business 
 brought out the fact that the gov- 
 ernment's purchases of war supplies 
 are so withdrawing material and 
 labor from established industry as 
 to create great problems for bus- 
 iness. 
 
 Extent of Government's Demand 
 
 The extent of the demand which 
 the Government is making upon the 
 industrial resources of the country 
 is indicated by the recent estimates 
 that the government expenditures 
 for the first year of the war (includ- 
 ing loans to the Allies) would 
 amount to twenty-one billion dol- 
 lars. This figure should be com- 
 
 [79] 
 
pared with eight hundred fifty-three 
 million dollars, the combined total 
 of all the business done by all of the 
 subsidiaries of the United States 
 Steel Corporation in 1916, or with 
 the estimates of the gross value of 
 all the business done in the United 
 States in the year 1916, which range 
 between forty and eighty billion 
 dollars. 
 
 Resulting Problems 
 
 To the established business of the 
 country it is vital that these vast 
 requirements of the government for 
 material and labor be met in a man- 
 ner to interfere as little as possible 
 with essential industry and in a 
 way to maintain as far as possible 
 in these abnormal times the normal 
 structure of business. The conclu- 
 sion was reached at Atlantic City 
 that each industry at the earliest 
 possible moment should appoint a 
 War Service Committee to speak for 
 the industry in connection with 
 these great problems. 
 
 Organization for Each Industry 
 
 Many lines of industry are se- 
 riously affected by inability to get 
 necessary material or labor and face 
 serious problems for the future in 
 connection with the shifting of labor 
 from one community to another. 
 Because these are problems, not only 
 of the individuals in an industry 
 but of the industry as a whole, the 
 industry should organize and act in 
 the common interest. These are 
 problems not only of business but 
 also for the government because it 
 is essential to the winning of the 
 war that the industrial life of the 
 country be maintained in sound con- 
 dition. Furthermore, the govern- 
 ment, to procure war materials and 
 supplies in the vast quantities re- 
 
 quired, needs the advice and assist- 
 ance of men having thorough ac- 
 quaintance with each industry, and 
 the committees can be of help in 
 this connection. Also, the govern- 
 ment is confronted with great prob- 
 lems in connection with the regula- 
 tion of prices and distribution and, 
 to avoid unnecessary interference 
 with business, needs. at its service 
 the practical knowledge and expe- 
 rience which could be furnished by 
 such committees. 
 
 Many committees have been ap- 
 pointed by the government under 
 the Council of National Defense. 
 These committees were formed 
 primarily with the thought of se- 
 curing the quantites which the 
 government has to purchase, rather 
 than to consider the broader prob- 
 lems which have more recently 
 developed in securing these vast 
 quantities in a manner to disturb 
 business as little as possible. Fur- 
 thermore, many of these commit- 
 tees have become inactive; in fact, 
 already a number of the committees 
 have been discontinued. Commit- 
 tees appointed by the government 
 are of limited usefulness. 
 
 Representative Committees 
 The vital importance of having a 
 truly representative committee in 
 each industry to speak to the gov- 
 ernment with regard to that in- 
 dustry and to transmit to the indus- 
 try such instructions 'as may be 
 given by the government, — in short 
 to furnish a point of contact with 
 the government in connection with 
 the problems of the industry, — was 
 made clear at Atlantic City 'and 
 made it seem advisable to the Con- 
 vention that each industry be asked 
 to hold a special meeting of all 
 those engaged in the industry to 
 elect a War Service Committee. 
 
 [80 
 
It was thought that such com- 
 mittees might undertake the follow- 
 ing: 
 
 1. To assemble accurate information 
 with respect to the facilities of the 
 industry, the possibilities of expan- 
 sion or the readjustment of plants 
 and equipment to meet the ever in- 
 creasing requirements of the govern- 
 ment. 
 
 2. To arrange for the gathering of fig- 
 ures as to cost of production in the 
 industry, including conditions in the 
 industry which were changing the 
 cost of production. In this respect 
 the committee would furnish to the 
 government information which would 
 prevent avoidable hardship in the 
 business by government regulation 
 of prices or distribution. 
 
 3. To act with the Priority Committee of 
 
 the War Industries Board which is 
 establishing principles governing the 
 distribution of materials in transpor- 
 tation and the order in which various 
 products are to be produced and 
 distributed. The work of the Prior- 
 ities Committee calls for an immense 
 organization and the quick adjust- 
 ment of industry to the demands of 
 the priority system. A "War Service 
 Committee representing an entire 
 industry can be of great value in 
 dealing with priority questions with 
 relation to that industry. 
 
 4. New facilities are being created and 
 there is great shifting of labor from 
 one section of the country to an- 
 other. War Service Committees 
 could offer suggestions regarding the 
 use of existing facilities or the em- 
 ployment of labor in districts of the 
 country where needed after the war. 
 
 5. These committees should be ready 
 at all times to meet with any of the 
 departments of the government when- 
 ever their advice is desired, to dis- 
 cuss questions affecting the industry 
 raised by the war needs of the gov- 
 ernment. The committees might also, 
 on their own initiative, present to the 
 government questions which call for 
 consideration. The committees might 
 from time to time suggest on behalf 
 of the industry how orders and ma- 
 terial can be distributed to the best 
 advantage, and with the least distur- 
 bance to existing or prospective con- 
 ditions. 
 
 Selection of Committees 
 It is evident that the War Service 
 Committees can be of great use to 
 the government and to the industry 
 
 but to reach the fullest service such 
 committees should be formed in a 
 thoroughly democratic manner. All 
 engaged in an industry should meet 
 and after careful discussion and 
 thought a committee should be 
 elected representing the large plants 
 and the small plants, the geograph- 
 ical distribution of the industry, 
 and composed of men of thorough 
 actual acquaintance with the bus- 
 iness and the conditions prevailing. 
 In this connection it is suggested 
 that the following points should be 
 kept in mind in selecting the mem- 
 bership of such committees : 
 
 A. All branches of the industry should 
 be represented on the committee, 
 whether members of a trade organ- 
 ization or not. 
 
 B. It is important that the committee 
 should include representatives ot 
 some of the smaller units of the 
 industry as well as the larger. 
 
 C. To be in a position to render efficient 
 service, the committee should not 
 necessarily be made up of the presi- 
 dents of the largest units of the 
 business or of the best known men, 
 but should contain men of recognized 
 ability who have a thorough knowl- 
 edge of the important details of the 
 industry, particularly costs, specifi- 
 cations and volume of production. 
 Where the industry is widely scat- 
 tered and different problems exist in 
 different sections, it is important to 
 have the different sections of the 
 country represented, but effort 
 should be made to appoint a com- 
 mittee which can be readily assem- 
 bled for committee meetings. 
 
 D. Sub-committees of the important 
 branches of the industry should be 
 appointed to cooperate with the War 
 Service Committee wherever pos- 
 sible. 
 
 In general War Service Commit- 
 tees should be composed of men 
 with a broad view of the industry 
 as a whole and with full comprehen- 
 sion of the fact that the war calls 
 for far-reaching changes in the 
 methods of nearly every business in 
 order to meet present national re- 
 quirements. 
 
 [81 
 
It is important that meetings for 
 the selection of War Service Com- 
 mittees be held at the earliest pos- 
 sible moment. It was the unani- 
 mous vote of the Atlantic City- 
 convention that the Chamher of 
 Commerce of the United States be 
 requested to bring to the attention 
 of all industrial interests the need 
 of prompt action and give its aid in 
 every possible way in the formation 
 of committees. 
 
 Personnel of Committees 
 
 The National Chamber is glad to 
 perform this service. It requests 
 that as fast as meetings are held 
 in various lines there be sent to its 
 headquarters in Washington a list 
 of all those in the industry invited 
 to participate in the meeting, a list 
 of all those who attended the meet- 
 ing and the names of the members 
 of the War Service Committee 
 chosen, with brief data about these 
 committee members and their bus- 
 iness connections. Records of 
 the committees organized in all 
 lines will be assembled in Wash- 
 ington and as soon as practical 
 a meeting of the committee chair- 
 
 men will be called for the pur- 
 pose of selecting an Executive Com- 
 mittee and to discuss a program of 
 work on common lines for all com- 
 mittees. The Chamber of Com- 
 merce of the United States earnestly 
 requests your immediate attention 
 on this matter and urges that you- 
 use your influence to secure action 
 quickly. 
 
 In having a general meeting of 
 all business men engaged in an in- 
 dustry, it is suggested that where 
 there is an existing organization 
 in the industry this organization 
 call such a general meeting. Where 
 there are two or more organizations 
 in a business that the organizations 
 should jointly call such a meeting. 
 Where there is no organization in 
 the business, it is suggested that 
 some of the leading men in the in- 
 dustry immediately call the meeting. 
 
 In some industries committees 
 have already been formed in accord- 
 ance with the procedure outlined 
 above. To establish the credentials 
 of such committees it would be well 
 to furnish a list of those invited to 
 the meeting and of those actually 
 attending the meeting at which the 
 committee was elected. 
 
 [83] 
 
XIII 
 
 The Council of National Defense 
 
 As the Council of National Defense 
 is the mechanism which was chiefly 
 organized for the purpose of absorb- 
 ing the shock occasioned by war, it 
 would be instructive to study the min- 
 utes of that body in order to ascertain 
 its own powers and capabilities for 
 growth and organization. In this con- 
 nection, the Advisory Commission of 
 the Council bears a direct relation to 
 the constructive abilities of the Coun- 
 cil itself, because it appears to be 
 thoroughly dominated by the Council 
 — to such a degree, in fact, that the 
 Advisory Commission to an outside 
 observer never presented the appear- 
 ance of being an entity. It seemed 
 more like a parasite. 
 
 The chief reliance for coordination 
 between the Council and its Commis- 
 sion, as well as amongst the individual 
 members of both Council and Commis- 
 sion, was Mr. W. S. Gifford, who had 
 been appointed Director of both Coun- 
 cil and Commission. Mr. Gifford is a 
 young man whose voluntary service on 
 the Naval Consulting Board had been 
 usefully engaged upon the first real 
 war industrial census made by this 
 country. Mr. Gifford was Chief Sta- 
 tistician for the American Telephone 
 and Telegraph Company and brought 
 to his service in Washington a well- 
 informed mathematical type of mind, 
 to which he added tact and diplomacy 
 to such a degree that he has remained 
 Director through all the difficulties 
 which have confronted him. His ef- 
 forts have steadily been bent toward 
 a more effective coordination and, al- 
 though more slowly than one would 
 have expected, toward collection of ac- 
 curate statistics and other data of 
 national value. Had Mr. Gifford pos- 
 
 sessed greater experience in the busi- 
 ness world and perhaps greater force, 
 his influence might have been suffi- 
 ciently dominating to be more effec- 
 tive than it has proven. 
 
 The Council of National Defense, 
 consisting of six Cabinet officers, 
 merely grouped under that title, car- 
 ried on work which without the crea- 
 tion of the Council would probably 
 have been mainly handled anyway by 
 their respective departments. The 
 Council gave perhaps an added excuse 
 for more frequent meetings of that 
 particular group of Cabinet execu- 
 tives. The Commission, as well as an 
 outsider in constant contact with some 
 of its activities for several months 
 could judge, held infrequent meetings 
 and apparently each Commissioner to 
 a large degree "paddled his own ca- 
 noe." The personnel of the Commis- 
 sion, to some extent, would explain this 
 condition at a time when it might be 
 supposed that the country needed the 
 best amalgamated ideas of its leading 
 thinkers. 
 
 The experience of one individual 
 who endeavored to further the efforts 
 of the Advisory Commission may be 
 outlined. Early in April finding a 
 scarcity of furniture in Washington, a 
 half carload of office furniture was 
 shipped hurriedly to Washington and 
 offered to the Advisory Commission, 
 but it was not accepted, although, at 
 the time, the efforts of the Commission 
 were handicapped by lack of office 
 equipment. 
 
 Washington was being invaded by 
 literally thousands of men thrusting 
 their services upon the Council, but 
 for many weeks no central point was 
 provided where these anxious volun- 
 
 [83; 
 
teers could have their simplest in- 
 quiries answered. This need was so 
 obvious that it was frequently urged 
 upon the Director and others of the 
 Commission. 
 
 The difficulty of learning the loca- 
 tion of people who were engaged by 
 the Council or Commission, lack of 
 information regarding duties, author- 
 ity and plans, the fact that commis- 
 sioners were duplicating each other's 
 activities, the prevalent evidence that 
 the whole effort was almost a "go as 
 you please" affair, because no compre- 
 hensive plans had been prepared in ad- 
 vance, all contributed to the conclusion 
 that one of the most urgent needs of 
 the Commission was a bureau of in- 
 formation which should centralize the 
 changing and growing plans and in- 
 formation from day to day and serve 
 as a clearing-house for all who had a 
 right to use it. 
 
 With this need in mind, the offer 
 was made to the Director and Secre- 
 tary of the Advisory Commission by 
 the above-mentioned individual that he 
 would, at his own expense, estimated 
 to cost $20,000 to $50,000 per year, es- 
 tablish a clipping bureau for the pur- 
 pose of furnishing to the leading exec- 
 utives and commissioners abstracts of 
 information pertaining to their func- 
 tions. It was the idea that this de- 
 partment should gradually become a 
 bureau of information aiming to meet 
 the growing needs of the Council and 
 the Commission and to assist in con- 
 tacting with other governmental de- 
 partments. It contemplated the cre- 
 ation of a library for the purpose of 
 gathering and disseminating the 
 wealth of important literature bearing 
 upon Great Britain's and other war 
 experiences and contemplated also a 
 definite method for marketing this 
 useful information to those who might 
 not realize its value, but who, by per- 
 sistent education, should, in time, be 
 
 enabled to use it. A complete multi- 
 graphing outfit was tendered as an im- 
 portant auxiliary to such service. Such 
 a bureau had untold value as an 
 educational and unifying factor but 
 it never appealed sufficiently to have 
 the proposal accepted or encouraged, 
 or even to have, in any comprehensive 
 way, the idea copied. 
 
 The British Prime Minister is said 
 to have one clipping bureau devoted 
 exclusively to compiling information 
 obtained from enemy countries relat- 
 ing to their plans. A specially edited 
 daily paper furnishes the Kaiser and 
 the German General Staff with in- 
 formation essential to their daily 
 activities. 
 
 The individual mentioned had vis- 
 ited Great Britain and France, had 
 studied munition plants, hospitals, 
 the shipyards, the fleet and the armies 
 at the front and for a year had been 
 collecting literature bearing upon such 
 war problems. Up to date he has en- 
 deavored to make this collection of 
 service to various departments of the 
 government, many of which need 
 some of the information involved and 
 do not know where to get it. Our 
 large industrial corporations have 
 demonstrated the usefulness of equiv- 
 alent libraries and information de- 
 partments, but have generally discov- 
 ered that it takes a long time to edu- 
 cate employees to make adequate use 
 of such facilities, and to succeed quick- 
 ly, centralized educational direction 
 from the top is essential. 
 
 Organization Without a Backbone 
 
 The appointment of great numbers 
 of committees, often without their 
 powers or authority clearly outlined, 
 often duplicating activities or exist- 
 ing with huge gaps, has often shown 
 the need for central direction of or- 
 ganization on a comprehensive scale. 
 
 [84] 
 
Mr. Daniel Willard's organization 
 progress as Chairman of the Advisory- 
 Commission and of its Transportation 
 Committee illustrated the lack of gen- 
 eral supervision of that vital problem 
 of organization which was entitled to 
 first consideration as the first step in 
 preparation for war work. Although 
 considerable progress has been made 
 without such unified planning, the cost 
 to the country through unnecessary 
 delays must be great beyond measure. 
 It is evident upon reflection that every 
 one of the illustrations mentioned in 
 this pamphlet applying to several of 
 the most important functions of our 
 war machine leads to the same general 
 conclusion. We have plunged into our 
 activities with unnecessarily limited 
 foresight, forethought and foreplan- 
 ning. Impelled by the immense amount 
 of work to be done, every executive 
 
 has immediately made of himself a 
 routine operating man. The very pat- 
 riotism and energy of their efforts kept 
 goading them on to doing more work 
 themselves. The feeling of responsi- 
 bility for their individual problem 
 more and more made it difficult to ap- 
 ply the broad vision that accompanies 
 detached thinking. Thus it became 
 increasingly difficult to apply the rem- 
 edy. The more the machine speeded 
 up, the more each man became the 
 slave of his own work and the more 
 his chief thought was to be let alone 
 to do the daily tasks which were crush- 
 ing down upon him. Perhaps the sur- 
 prising part is that, under such cir- 
 cumstances, the achievement is as 
 great as it is. Every American must 
 admire the fortitude, the grim deter- 
 mination, the superb patriotism that 
 underlie these achievements. 
 
 85 
 
XIV 
 
 Congress, Apply the Lessons! 
 
 Unfortunately the invisible censor- 
 ship, the very evident distaste for in- 
 vestigation, criticism and, at times, 
 even suggestion, have made application 
 of the fundamental remedy impossible 
 until the compelling power of Congress 
 "lifted the lid." 
 
 And now the main thought must be 
 "How can the nation obtain the utmost 
 in result from the feverish activities 
 of its war personnel?" 
 
 We have not in this country, as En- 
 gland has, an organized "Opposition," 
 therefore we must increasingly rely 
 upon our executives for voluntary 
 frankness. Lord Northcliffe has in- 
 sistently and persistently told the 
 British that censorship served chiefly 
 to hide government inefficiency. Our 
 own experience suggests that it might 
 be safer to tell Germany the 10% she 
 does not know about our war progress 
 rather than keep from Americans the 
 90% we still need to know in order to 
 enforce adequate speed and efficiency. 
 
 The American has astonishing re- 
 spect for officialdom. His confidence 
 in his leaders is unbounded, all of 
 which throws upon our executives an 
 extreme obligation for honest frank- 
 ness. At present the nation is faced 
 by an actual shortage of mutton, beef, 
 pork and grain which is largely re- 
 sponsible for the difficulty in limiting 
 prices. The public has not been told 
 this frankly by our executives, there- 
 by permitting the I. W. W. and other 
 agitators to blame the high cost of liv- 
 ing entirely upon profiteers, which is 
 only partly correct. Had our people 
 been officially informed with frank- 
 ness regarding the unquestioned atroc- 
 ities of Germans and Austrians prior 
 to our entering the war and even after 
 
 [ 
 
 the unrestricted submarine campaign, 
 it seems probable that public opinion 
 and Congress would have felt war- 
 ranted in forcing preparations which 
 would perhaps have saved us a year of 
 war. 
 
 Sympathetic Suggestion 
 Acceptable? 
 
 It is difficult for Congress, with 
 only the superficial information which 
 even extended investigation can fur- 
 nish of this tremendous national ef- 
 fort, to formulate specific changes in 
 organization that are likely to meet 
 with the support of the executives in- 
 volved in sufficient degree to insure 
 success. 
 
 It is to be hoped, however, that sym- 
 pathetic suggestions from Congress 
 might lead the executives themselves 
 to carry out in principle and to formu- 
 late in detail whatever is necessary to 
 achieve maximum progress. 
 
 If the President desires to retain 
 active direction of the business of wag- 
 ing war, it might be feasible, with no 
 new legislation, for him to appoint an 
 assistant as business manager, or or- 
 ganizing assistant, or with no title 
 whatever, in whom should focus all of 
 the strictly business problems in- 
 volved. Then were this individual to 
 be reinforced with an adequate plan- 
 ning department which should have the 
 benefit of the President's frequent ad- 
 vice, it would seem that permanent or- 
 ganization, correct in principle, could 
 be quickly provided. 
 
 Our nine months of war experience 
 have taught many lessons. The New 
 Year should make us resolved to apply 
 them. The plan suggested would 
 doubtless occasionally require added 
 
 86] 
 
legislation, because it would probably 
 be attended by rearrangement of de- 
 partmental responsibilities and per- 
 haps the creation of new departments. 
 But whatever changes were made 
 would necessarily be made with con- 
 sideration of the entire situation and 
 all the national and international 
 needs rather than through the unbal- 
 anced pressure that now is the chief 
 cause of progressive changes in organ- 
 ization and activity. 
 
 If such a plan should meet with 
 opposition, the method favored by 
 many students of organization, in- 
 volving the creation of a superior 
 War Council or Board, overriding 
 the Cabinet departments and heading 
 directly up to the President, offers cer- 
 tainty of marked increase of efficiency 
 and speed. This more nearly corre- 
 sponds to the British method. Its suc- 
 cess, likewise, depends greatly upon 
 the individuals appointed to such ex- 
 treme powers. Some of our executive 
 appointments in the past have scarcely 
 commanded the approval of the 
 country. 
 
 While one must admire the Presi- 
 dent's loyalty to the associates he has 
 chosen and to his appointees to vari- 
 ous staffs, it is nevertheless important 
 to remember that even capable men 
 wear out under the strain of war work 
 and that not all men of even admitted 
 ability possess the adaptability to op- 
 erate successfully in new surroundings 
 and under new conditions. Also it is 
 difficult to judge whether a man has 
 sufficient constructive ability to meet 
 the demands of a rapidly changing re- 
 sponsibility until he has been tried in 
 the actual performance. Should he 
 not come up to expectations, it is no 
 disgrace to the man, as there may be 
 other positions in which he would 
 succeed. Our unwillingness to make 
 special effort to get the best men fitted 
 into the right places without fear or 
 
 [ 
 
 favor has brought forth warranted 
 criticism. 
 
 There are two ways to succeed. One 
 is by doing the right thing ; the other 
 is by doing the wrong thing, but cor- 
 recting it so quickly that the net result 
 is quick progress. Nobody is infall- 
 ible. Never before have individuals 
 faced such tremendous situations. Al- 
 most any mistake can be forgiven if 
 corrected with courage and speed. 
 
 A special committee, entrusted 
 with locating the ablest operating and 
 constructive minds in America should 
 be constantly seeking the qualities so 
 urgently needed in high places in 
 Washington, always requiring the 
 square peg for the square hole. 
 
 Let Us Begin Anew 
 
 It is said that America has always 
 done what she set herself to do. Un- 
 fortunately, our history shows, that 
 while this is true, the price has gener- 
 ally been unnecessarily high. 
 
 Let us organize the encouragement 
 and analysis of suggestions in every 
 department and the application of use- 
 ful ones. 
 
 Let us discover governing principles 
 ' in each one of our general activities. 
 Let us discontinue reliance upon charts 
 of organization which do not function. 
 Let us with central leadership develop 
 inspection forces capable of preventing 
 honest mistake or abuse on the part 
 of profiteers in whatever station and 
 sufficiently intelligent to carry the les- 
 sons to the executives who can apply 
 measures to correct avoidable weak- 
 nesses. 
 
 Great Britain has learned the im- 
 mense value of flying squadrons of 
 skilled workers willing to jump to 
 strengthen the weakest spot in produc- 
 tion, wherever it may appear. Let us 
 apply the flying squadron idea not only 
 to skilled workers, but to managers, en- 
 gineers, auditors, cost clerks, shipping 
 87] 
 
clerks, superintendents and all of the 
 essential positions that at any time in- 
 dicate weakness. 
 
 Let us also apply the idea of train- 
 ing and education so that not only pro- 
 gressive improvement in the carrying 
 out of duties, but also coordination 
 and unification of method and plan, 
 shall result. 
 
 Let the accumulation of accurate 
 data and information, of comprehen- 
 sive ideas and suggestion be devel- 
 oped so that it may be sifted and 
 filtered and furnished in sufficiently 
 condensed form to all of those who 
 need and should use it. 
 
 Stagnation, conflict, disagreement 
 must be reported and delay obviated 
 by adequate checking systems. 
 
 Let our means for investigation be 
 like the "tanks," capable of overriding 
 any entanglements. 
 
 National census of alien and indus- 
 try, of skilled worker and raw mate- 
 rial, of every factor that needs regu- 
 lative distribution and application 
 must not be delayed through dismay 
 over the size of the task. 
 
 Mathematics, properly applied, will 
 win the war. 
 
 If our strictly military operations 
 must be separated from the business 
 of purchase, production and distri- 
 bution, let the job be clearly and thor- 
 oughly done. 
 
 Let us no longer rely upon such 
 mechanisms as the Aircraft Board 
 limited to an expenditure of $100,- 
 000, accepted by the country as 
 the responsible body for produc- 
 ing the aerial fleet which is to win 
 victory and yet limited in fact to 
 mere suggestion and without organiza- 
 tion even to suggest comprehensively. 
 Without discredit to the members of 
 that Board, one is warranted in pre- 
 dicting that Germany will be superior 
 to her enemies in the air next Spring. 
 Let our entire military activities, 
 
 including naval, be concentrated in a 
 supreme General Staff formed of ex- 
 perts, capable of applying aggressive- 
 ly the combined military, naval 
 political, financial, commercial, indus- 
 trial and other forces which collec- 
 tively form our national strength as 
 applied against the enemy. 
 
 Above all, let us cease applying make- 
 shift remedies. The proposed creation 
 of a munitions chief to be a Cabinet 
 member and to control production of 
 war supplies would, it is true, be an 
 improvement over present arrange- 
 ments, but the lack of coordination 
 among the Cabinet executives and the 
 various administrators would still re- 
 main a fatal weakness. 
 
 Is This Patriotism ? 
 
 About the middle of last June, two 
 American business men who had been 
 giving their time in Washington, be- 
 came alarmed over the lack of co- 
 ordination and vision and the com- 
 placency that seemed to prevent the 
 doing of our utmost and arranged a 
 meeting in New York with fifteen or 
 twenty leading newspaper owners and 
 editors. A series of facts showing 
 specific danger from enemy spy ac- 
 tivities, from vacillation and mistakes 
 in the Navy Department, from the lack 
 of coordination everywhere, from the 
 invisible censorship and the difficulty 
 of carrying suggestion effectively to 
 some executives, was presented. Then 
 the newspaper men were urged to 
 speak more frankly to the country. 
 They admitted the truth of the facts 
 presented and the inevitable danger 
 that must result from continuation of 
 such conditions, but they said, "The 
 country considers it patriotic to 
 stand behind the President and any- 
 thing which appears in any way to 
 be a criticism of the administration 
 will not be tolerated by the people. 
 
 [88] 
 
Nothing can be done until there is 
 a disaster." 
 
 Since then we have had disaster 
 after disaster. Some of them have not 
 appealed to Americans because dis- 
 aster in Italy, disaster in Russia, dis- 
 aster in our own shipbuilding plans, 
 have not yet assumed their proper re- 
 lationship in the public mind. Is it 
 true that democracy must depend upon 
 disaster for progress? Can autoc- 
 racy alone calmly and efficiently plan 
 and provide in advance against the 
 problems of the future? 
 
 For many months, the Patriotic Ed- 
 ucation Society has endeavored to 
 carry these messages to our executives 
 and, failing in that, to our people; 
 but much yet remains to be done. 
 
 For nine months the supply of 
 spruce necessary to carry out our own 
 airplane program and that of our al- 
 lies has been jeopardized for want of 
 a few thousand lumbermen in the 
 spruce forests of the Northwest. 
 Plan after plan has been made by 
 the Aircraft Board and the War 
 Department to overcome this diffi- 
 culty, even including sending men 
 from the cantonments into the forest. 
 These plans have generally been 
 thwarted by some other bureau or di- 
 vision of the War Department itself. 
 This is not surprising perhaps when 
 one considers at random other typical 
 instances showing lack of recognized 
 policy and control by employees of 
 various government departments : — 
 
 a. The War Department located a 
 quantity of TNT and was negotiating 
 for a lower price when the entire lot 
 was purchased by the Navy at the 
 price asked by the owner. 
 
 b. A certain product was sold at six 
 different prices to six different de- 
 partments in the War Department. 
 
 c. Methods and times of payment 
 for purchases differ in various depart- 
 
 [ 
 
 ments and also in the same depart- 
 ment. 
 
 d. An officer in the Ordnance De- 
 partment was recently actively en- 
 gaged in recruiting labor for the 
 Ordnance Department from munition 
 plants in one of the greatest munitions 
 producing districts of the country. 
 
 e. Contracts for shipyards on the 
 Pacific coast were let without any re- 
 gard to the local labor supply. 
 
 f. Both public and official attention 
 have been so largely concerned with 
 the problem of building ships that 
 the equally important one of opera- 
 ting ships in service efficiently has 
 been sadly neglected, as even super- 
 ficial investigation would disclose. 
 
 g. The War Department's recently 
 organized War Council apparently 
 duplicates the work which properly be- 
 longs to the General Staff. 
 
 h. A writer in the New York Times, 
 December 23rd, 1917, states there 
 have been three thousand strikes 
 since we entered the war. No gov- 
 ernment department has a list of these 
 strikes, nor complete data regarding 
 the causes of their origin, method of 
 settlement and present conditions. 
 
 i. It is said that we sent to France 
 when we entered the war more than 
 four thousand Red Cross doctors, 
 nurses, ambulance drivers, without in- 
 vestigation as to their qualifications 
 and loyalty. The government had been 
 repeatedly warned that this was a pro- 
 lific field for spies and several have 
 already been found among those early 
 quotas. 
 
 j. With an accumulation of freight 
 at Vladivostok estimated to require 
 from two to seven years to transfer 
 over the Siberian railway, the un- 
 necessary drain on ship tonnage is 
 evident at a glance. 
 
 k. An officer recently from the front 
 in France sees evidence that insuffi- 
 cient attention is being paid to the 
 89] 
 
production of those supplies most 
 needed first and fears that we will 
 produce enormous quantities of ma- 
 terial not needed for a long time at 
 the expense of things urgently needed 
 first. This is closely related to the 
 Vladivostok condition mentioned in 
 the preceding paragraph. 
 
 1. The statement was made in the 
 spring of 1917 that the Navy Depart- 
 ment had contracted for 70% of the 
 capacity of American shipyards. It 
 might be interesting to investigate 
 the cooperation between the Navy De- 
 partment, the Shipping Board and the 
 ship builders for the purpose of mak- 
 ing all our ship building facilities go 
 furthest and to meet the most urgent 
 needs first. 
 
 m. Some of the 154 committees of 
 the Council of National Defense 
 scored Congress for delay in making 
 appropriations specifically requested 
 by executive department officials. A 
 national budget system placing re- 
 sponsibility upon executives would 
 seem to be an important war measure. 
 
 n. From the Manufacturers' Record 
 of November 1st, 1917, we quote: — 
 
 "We recently published a summary 
 of a report of a committee on the ni- 
 trate question, but, as we have studied 
 that report, we cannot accept all of 
 its conclusions. Two of the recommen- 
 dations were as follows: 
 
 "That the decision as to more ex- 
 tensive installation of nitrogen fixa- 
 tion processes and water-power de- 
 velopment in connection with them be 
 postponed until the plants above 
 recommended are in operation or until 
 further need arises. 
 
 "That while the preceding recom- 
 mendations include all the measures 
 that can now judiciously be taken for 
 the fixation of ammonia, it is the opin- 
 ion of the committee that the imme- 
 diate accumulation and the permanent 
 maintenance of an ample reserve not 
 
 less than 500,000 tons of Chile salt- 
 peter is the measure most urgently 
 necessary. 
 
 "Here is an urgent, imperative call 
 to accumulate immediately 500,000 
 tons of Chilean saltpeter and the main- 
 tenance of that amount as a reserve. 
 Even if no adverse conditions of any 
 kind as to submarines or as to the in- 
 ability to secure Chilean nitrates 
 should be developed, it would require 
 100 shiploads of 5,000 tons each to 
 bring this nitrate to America and 
 many other shiploads to keep up the 
 supply. 
 
 "The coal shortage is being inten- 
 sified by the lack of water-power de- 
 velopment, and the nation is suffering 
 today in every direction — in army 
 work and navy work, in factory opera- 
 tions and in private homes — because 
 we have thrown around coal produc- 
 tion unwise restrictions, and because 
 coal now, of necessity, enters into 
 many uses for which hydro-electric 
 power would be available but for the 
 blunders of Congress, led by profes- 
 sional theorists and alleged patriots. 
 
 "It seems to us almost criminal 
 shortsightedness to depend upon the 
 purchase of 500,000 tons of Chilean 
 saltpeter and the maintenance of a 
 reserve of that amount, for it is ex- 
 ceedingly doubtful if we can secure ;L 
 and certainly we cannot secure it in 
 time and certainly we have not the 
 shipping to spare for it. 
 
 "The suggestion that a new system 
 of producing nitrate may work out 
 satisfactorily, however high may be 
 the character of the men who made 
 this report, must, of necessity, be open 
 to serious question as to its wisdom 
 when coupled with this purchase of 
 Chilean nitrates as a prime requisite 
 while waiting to test out the new sys- 
 tem. Had a decision been reached 
 
 90 
 
that the Government should imme- 
 diately spend the $20,000,000 which 
 Congress voted for that express pur- 
 pose, the work might have been well 
 under way, and had not the dilatory 
 tactics of the first committee to whom 
 this matter was committed by Con- 
 gress — dilatory because they did not 
 apparently recognize the one supreme 
 issue before the world of making war 
 and saving ourselves — delayed the 
 work, we might be almost at the point 
 today of being able to produce nitrates 
 equal to our needs. Time more price- 
 less than any time in all human his- 
 tory was wasted and is being wasted, 
 and the life of the nation may yet 
 
 hang in the balance because of that 
 wasted time." 
 
 Who Is Responsible? 
 
 An American technical expert who 
 was investigating fixation plants in 
 Europe about a year ago remarked 
 that not until Germany considered 
 herself equipped to produce artificial 
 nitrates did she start the war. If we 
 are to apply the Lewis gun principle 
 to the nitrate supply who assumes the 
 responsibility? Study the organiza- 
 tion chart on the back cover of this 
 pamphlet and see if you can find out 
 where the blame would rest should 
 national disaster result from this 
 delay. 
 
 ;9i] 
 
XV 
 
 Importance of Personnel 
 
 It is rumored that the Advisory Com- 
 mission of the Council of National 
 Defense was offered by President Wil- 
 son all of the power and authority that 
 it was willing to accept. The Advisory 
 Commissioners quickly became, like 
 the Cabinet officers, routine men. There 
 was little evidence on the outside of 
 their meeting regularly and frequently, 
 like a Board of Directors, to consider 
 the general policies and functions of 
 the Commission. Even if they had 
 attempted to operate as a Board and 
 build an organization capable of rapid 
 expansion to meet every emergency, 
 one might question whether with the 
 personnel of the Advisory Commission 
 much success would have followed, 
 unless by good fortune a chief could 
 have been obtained who had the con- 
 fidence and daily support of the Pres- 
 ident and who could lead the Commis- 
 sion toward definite policies and action 
 unhampered by the retarding influ- 
 ence of the bureaucratic peace organ- 
 izations. 
 
 Given correct organization, even me- 
 diocrity of personnel cannot prevent 
 progress. In industrial life exception- 
 al ability and energy may override red 
 tape and obstruction. But in Federal 
 affairs even that possibility is lacking 
 because the job is so big and inter- 
 locking that individual effort, without 
 organized initiative, is imprisoned. 
 Nevertheless, when all work is new, 
 when every day brings unexpected 
 changes, the constructive mind is 
 needed in every expanding department 
 and committee. 
 
 Washington and the world generally 
 have not distinguished between con- 
 structive and operating abilities. The 
 good operating man is usually a rou- 
 ts 
 
 tine man — he wants conditions fixed 
 and unchanging in order to achieve 
 efficiency. When improvements in 
 method and mechanism are not neces- 
 sary the less change the better for 
 efficiency. But when method and 
 mechanism are inadequate then con- 
 structive thought is required. Con- 
 structive minds usually chafe under 
 stationary conditions. They long for 
 the best and try to obtain it even at 
 sacrifice of temporary efficiency. The 
 man who effectively combines operat- 
 ing efficiency with constructive vision 
 is rare. He is usually his own boss. 
 
 Americans are apt to worship men 
 who have achieved national fame. Even 
 though their distinction has been 
 gained in one narrow field, the famous 
 one is usually credited by the unthink- 
 ing with universal knowledge. Fre- 
 quently the man of national reputation 
 owes his apparent success to conditions 
 to which he in no way contributed. 
 Study of the careers of some of the 
 prominent business men in Washington 
 today shows that several of them have 
 become connected with organizations 
 containing all of the essentials for 
 success and have simply been carried 
 along by those organizations, thus 
 gaining an undeserved prestige. 
 
 The student is scarcely expected to 
 find many highly constructive minds 
 among railroad executives, because 
 railroad operating has become a highly 
 developed routine business and the 
 bank control of our railroads has not 
 been conducive to independent con- 
 structive effort. 
 
 These thoughts give good reason for 
 more frequent change of personnel in 
 high positions of authority than has 
 been visible in Washington. Congres- 
 
sional investigation and worse disas- 
 ters than we have yet recognized will 
 be necessary to change these condi- 
 tions, unless our present rule by over- 
 loaded co-equals is quickly altered. 
 
 Our Washington administrative or- 
 ganization violates the important can- 
 ons of business organization. All of 
 our chief executives are overloaded 
 with detail and prevented by their very 
 responsibilities from taking adequate 
 national view points. The President, 
 as their only chief, through burden of 
 overwhelming world problems, cannot 
 be expected in himself to supply this 
 deficiency. 
 
 Every student of our weaknesses 
 knows that the demand for democracy 
 has pervaded both our peace and war 
 governing machine to such degree that 
 the very safety of democracy is threat- 
 ened thereby. Our rule by "Debating 
 Society Committees" is democratic. 
 Our two-headed Shipping Board (even 
 when each head considered himself the 
 direct agent of the President) was 
 democratic. Our seven-headed War In- 
 dustries Board with complete authority 
 to talk to the War and Navy Depart- 
 ments and to the public is certainly 
 democratic. 
 
 But even our democratic daily life 
 knows the principle of the Boss. He 
 plans, he orders. Let Congress and 
 Mr. Wilson legalize and recognize a 
 few properly qualified and unflinch- 
 ingly supported square-jawed Bosses. 
 Let them know that speed in the public 
 mind will outweigh a few quickly 
 corrected mistakes. 
 
 National Flexibility Needed 
 
 While Great Britain and France 
 have been for their military and econo- 
 mic safety throwing hampering tra- 
 dition and conservatism to the winds 
 America has lived complacently in the 
 past. 
 
 Searching their prejudices and hab- 
 its along with their hearts they are 
 indeed building new nations. Do we 
 know that our educational system does 
 not meet present-day needs? Are we 
 seeking new method and device and 
 suggestion from the corners of the 
 earth? Do we realize that our very 
 form of government has faults that 
 may cripple our future? That our 48 
 States handicap in unnecessary ways 
 our national defense? Are we plan- 
 ning for the utmost momentum in this 
 war and the continuing world struggle 
 to follow? Does our self-approval hide 
 the fact that the vast majority of our 
 corporations, according to our Federal 
 Trade Commission, do not figure their 
 costs accurately? The treatment of 
 both our poor neighbors and our pris- 
 oners has been barbarous. Our Future 
 bids us take stock of our short and our 
 long comings. 
 
 Great Britain has been peculiarly 
 fortunate in having as Prime Minister 
 a man brave enough to ignore prece- 
 dent when precedent did not suffice. 
 By word and deed he fought to put 
 the business men in positions of auth- 
 ority and he forced reforms of organ- 
 ization to give those men a chance. 
 
 Our organizing has been halting and 
 partial, our efforts spasmodic and 
 visionless. 
 
 93 
 
XVI 
 
 The Next Six Months 
 
 Napoleon early in his career pointed 
 to a principle upon which his own suc- 
 cess was built and which the Germans 
 have been consistently applying to the 
 repeated discomfiture of their antagon- 
 ists, "Unity of Command Is Essential 
 to Success. Time Is Everything." 
 
 A prominent French officer has re- 
 cently said "One soldier in 1918 is 
 worth several later." 
 
 Says M. Andre Tardieu, French 
 High Commissioner, just returned 
 from France: "Although the war 
 may be prolonged for years it will be 
 decided in the next six months." 
 
 Rumor has it that our national sup- 
 plies of chlorine, toluol, pyrites (for 
 sulphuric acid, the very keystone of 
 our war chemicals), manganese, ni- 
 trate and other related materials are 
 not sufficiently provided against all 
 contingencies. Investigation behind 
 closed doors might here find further 
 argument for speed in reorganiza- 
 tion. Have shipping, the expanding 
 war demand for chemicals, all the 
 acts necessary for speeding the 
 safeguarding of both our soldiers 
 in Europe and the resources behind 
 them, have all these been in proper 
 sequence and relation considered? 
 Are we applying the experience of 
 Europe in salvaging all wastes and 
 remnants of value and converting 
 them to fresh service? 
 
 Experimental Facilities Adequate? 
 
 The Washington Post of December 
 23d in its leading editorial makes an 
 earnest plea for national concentration 
 of inventive resource and genius 
 against the submarine, as our in- 
 creased shipbuilding program is mere- 
 
 [ 
 
 ly furnishing increased fodder for the 
 submarine. 
 
 So insistent have been the complaints 
 of inventors, even of national repute, 
 over the difficulty of obtaining ade- 
 quate consideration for their sugges- 
 tions that one is justified in fearing 
 that our national experimental facili- 
 ties are inadequate to the need and 
 that our professional military and 
 naval chiefs and many of their sub- 
 ordinates are not sufficiently receptive 
 toward new ideas, especially those 
 developed by outsiders. 
 
 Congressional investigation into this 
 problem and increased liberality of 
 appropriation seem worthy of consid- 
 eration. 
 
 Plan Our Utmost Now? 
 
 Assuming, as has frequently been 
 stated, that the Allies have 7,000,000 
 troops on the Western front opposed 
 to 3,000,00 of the Central Powers, 
 what "preponderating force" must 
 America hurl at the enemy in the 
 West to gain a military victory? 
 
 First we planned an army of one 
 million — now three million are men- 
 tioned. If seven million men can- 
 not whip three million men defend- 
 ing their own frontiers, equipped 
 with every facility of transportation 
 and supply, carefully developed by 
 years of study, is it not within the 
 bounds of reason that America must 
 needs send five million, perhaps even 
 ten million men to Europe to whip 
 autocracy? Is it not reasonable to 
 consider that German thoroughness 
 may obtain food and other supplies 
 from Russia even though Russia her- 
 self may need them? The chief hope 
 94] 
 
of an early peace has been built 
 upon a starving Germany — but that is 
 a dangerous reliance. It would there- 
 fore seem to behoove us to make thor- 
 ough plans for a long war involving 
 our utmost contribution of soldiers, 
 production and transportation. 
 
 Optimistic statements of the Ship- 
 ping Board chiefs before the Congres- 
 sional Investigation Committee indi- 
 cate that with one shift per day our 
 shipyards are likely to produce ten mil- 
 lion tons deadweight in two years. Let 
 us not forget that ten million tons 
 deadweight mean only about four mil- 
 lion net tons or perhaps six million 
 gross tons. 
 
 An American civilian returning in 
 December, 1916, from a visit to the 
 British fleet and the shipyards of the 
 Clyde explained to Secretary Daniels 
 how it was that the British shipbuild- 
 ers could complete a super-dread- 
 naught or battle cruiser in less than 
 20 months when American shipbuild- 
 ers were figurng upon 48 to 54 months. 
 The explanation was simple. Amer- 
 ican yards worked one shift of 8 hours 
 per day, the British used two shifts 
 of 10 hours each. Our munition fac- 
 tories all over the land were working 
 two and three shifts per day but ap- 
 parently our own vitally important 
 shipbuilding program was being de- 
 layed for lack of application of this 
 common principle: — that the quickest 
 way to increase the output from lim- 
 ited facilities is to work those facilities 
 24 hours per day. If our shipyards are 
 able with one shift to produce five mil- 
 lion tons deadweight per year, why 
 should we not treble our program and 
 aim at 15 million tons dead weight in 
 1918, this output to result from operat- 
 ing the yards 24 hours per day? Fif- 
 teen million tons in 1918 will be worth 
 to the world double the value of that 
 same tonnage produced in two years. 
 But this means labor control in the 
 
 shipyards, in our transportation sys- 
 tems and in all directly subsidiary ac- 
 tivities. Is not the result worth the 
 effort? 
 
 Most Urgent Immediate Need 
 
 The charge as made by Representa- 
 tive Clarence B. Miller regarding our 
 bungling transport service to France 
 connected with many other reports of 
 ineffective use of existing tonnage 
 points to this as one of our most ur- 
 gent needs for improvement in con- 
 cert with our Allies and neutral 
 nations. Placing all of our efforts in 
 the order of both time and importance 
 one is warranted in suggesting that 
 this is the most urgent of all. 
 
 In our enthusiasm over the launch- 
 ing of ships we must remember that it 
 takes ordinarily about three months 
 to fit out a ship for service after it 
 has been launched. In the last stages 
 of a world conflict those three months 
 might represent the difference between 
 victory and defeat. 
 
 Constructive Criticism, Privately 
 Applied, Failed 
 
 Many military authorities believe 
 that had America entered the war 
 when the Lusitania was sunk the world 
 would now be at peace, the great deci- 
 sion obtained with far less sacrifice 
 than has already been made. So anx- 
 ious have been many of our executives 
 to obtain the approval of the country 
 for their great achievements since 
 America entered the war, those 
 achievements measured against peace 
 conditions rather than against war 
 needs, that it does not seem an over- 
 statement to say that an organized 
 propaganda has been used for this pur- 
 pose directed largely from Washing- 
 ton. Had the same effort been ap- 
 plied to looking forward rather than 
 backward, to estimating the needs of 
 next year and planning to meet them, 
 
 [95; 
 
would the country have supported our 
 executives any less generously? Would 
 realization of the real size of the work 
 ahead of us have frightened us or 
 urged us to greater effort? Well may 
 we admire the splendid achievements 
 to the credit of our leaders, but con- 
 demn we must the weaknesses that 
 threaten the value of those very 
 achievements. 
 
 Great Britain has done her best 
 when visibly confronted with the 
 greatest dangers, while several of our 
 leaders in Washington have persistent- 
 ly advocated the policy of keeping 
 from the public the most alarming 
 dangers confronting the country un- 
 less expressed in the most general 
 terms. This has been voiced by cab- 
 inet officers, even by President Wilson, 
 in such terms as "why alarm the coun- 
 try?" Members of Congress have also 
 voiced this feeling. As a result, 
 America has yet failed to do her ut- 
 most and her citizens do not yet real- 
 ize the individual obligations and sac- 
 rifices they should already be facing. 
 Consequently we are still tolerating 
 labor disturbances, profiteering, ex- 
 travagance and waste, and many other 
 evils which are daily increasing the 
 loss of life which must be incurred by 
 our Allies and ourselves. 
 
 "The war will be decided in the next 
 six months" — What extra efforts are 
 we making to face that crisis? 
 
 The New York Times of December 
 26th editorially points out that greater 
 speed in preparation must come by 
 pressure from above. Much of the 
 speed already achieved has come by 
 surging up from below, through insis- 
 tence of a relatively small number of 
 far-seeing citizens. 
 
 Secretary Redfield in our ninth 
 month of war has ordered his subord- 
 inates to forget red tape and has pro- 
 vided a sort of check against undue 
 delay in action and decision. Presi- 
 
 [ 
 
 dent Wilson has recommended that his 
 other executives follow this example. 
 This is encouraging as far as it goes, 
 but it is a clear indication of past 
 failure to provide adequately for speed 
 and is only one step of many necessary 
 to insure speedy progress for the 
 future. 
 
 It is said that within 48 hours after 
 the Italian defeat one of our great 
 departments authorized the closing of 
 contracts by telegraph before detailed 
 specifications had been worked out. 
 It thus required serious defeat to in- 
 duce a speed which might have been 
 achieved without waiting for such in- 
 centive. Washington is often accused 
 of playing the game of "passing the 
 buck" — in ordinary life sometimes de- 
 scribed as "let George do it." Bureau- 
 cracy aims to surround itself by checks 
 against mistakes so that it leaves clear 
 gaps between Departments and avoids 
 doing many things which "others may 
 do." In war time these conditions 
 lead to the greatest possible mistake 
 —the mistake of doing nothing, the 
 mistake of delay. In such times the 
 utmost is none too much, because any- 
 thing less inevitably means loss of life 
 that might be spared. Our only justi- 
 fication in looking backward critically 
 is to apply the lessons for the purpose 
 of avoiding repetition of mistakes. As 
 someone has said "Washington is high- 
 ly organized for looking backward but 
 not for going forward.". 
 
 It will be observed that the same 
 conclusion regarding the fundamental 
 weaknesses and the remedy may be 
 drawn from each illustration sub- 
 mitted in this pamphlet. Our ship- 
 building, labor, intelligence, alien, 
 transportation, and other problems all 
 show the same lack of foresight, the 
 same neglect of plan, the lack of pro- 
 vision for a planning mechanism, lack 
 of adequate information upon which 
 to base intelligent planning, lack of 
 96] 
 
adequately informed executives free to 
 give daily decisions and enforce speed 
 of action unhampered by excessive red 
 tape. Many of these lessons have been 
 carried through private channels and 
 with the most helpful of intentions to 
 
 the ears of those who appeared to have 
 authority to apply the remedies. As 
 our war preparations, however, in- 
 crease in scope and complexity, the 
 need for these remedies becomes rapid- 
 ly more visible and urgent. 
 
 [9T] 
 
XVII 
 
 The General Staff 
 
 Various Superior Organizations 
 
 A Supreme General Staff, as some 
 would have it, would under the Pres- 
 ident be the supreme directing war 
 power of the land. Not only military 
 control, but everything contributory, 
 would come within its scope. It would 
 naturally include both military and 
 civilian in its personnel. 
 
 Other students of the problem pre- 
 fer to divide the directing power, al- 
 ways under the President,between two 
 coequal bodies, each supreme in its 
 field. One would control all military 
 activities. The other, roughly speak- 
 ing, would provide everything needed 
 for the military activities. 
 
 Americans in general will prefer to 
 interfere as little as possible with our 
 established governmental machine. 
 Careful perusal of four following ar- 
 ticles, from recent issues' of The New 
 Republic, prove the insanity of relying 
 upon that machine in all of its present 
 and wonderful workings: 
 
 Unity of Command 
 
 "On the day the Germans and Aus- 
 trians drove Cadorna's army back 
 to the Tagliamento, somebody 
 called up Secretary McAdoo on the 
 long-distance telephone — he was 
 temporarily outside of Washing- 
 ton — and secured authorization for 
 an immediate loan of $230,000,000 
 to Italy. On the same day the War 
 Trade Board granted to Italy the 
 right to export immediately what- 
 ever she needed. Tonnage to trans- 
 port it was allotted to her — ton- 
 nage which had previously been 
 allotted to France to help carry 
 
 abroad that million tons of French 
 raw material piled on American 
 docks. The news of this assistance,, 
 cabled to Rome, is said to have 
 aided in maintaining Italian mo- 
 rale. It satisfied our demand that 
 something be done. Yet it can 
 hardly result in any military help 
 at the front before the first of De- 
 cember. It can do little to assuage 
 the disappointment of the Italian 
 represenatives in this country who 
 for months have requested in vain 
 a priority for their materials. And 
 if before December first the Ital- 
 ians, with British and French help, 
 have stemmed the enemy invasion, 
 and the heat of battle has returned 
 to the western front, the British 
 and French armies may suffer for 
 the lack of the supplies formerly 
 destined for them, and suddenly di- 
 verted to other uses as the result 
 of a telephone conversation with no 
 greater strategic authority than 
 the Secretary of the Treasury. 
 
 The sudden grant to Italy of as- 
 sistance for which her representa- 
 tives in this country have long been 
 asking can be construed as an im- 
 plicit condemnation of the previous 
 refusal, but such an inference is 
 not justified. The American gov- 
 ernment has been guessing. It has 
 to take decisions without being pos- 
 sessed of all the information on 
 which a wise decision should be 
 based. In the case of both the re- 
 fusal and the compliance it may or 
 may not have been advisable to 
 grant priority to the Italian de- 
 mands. There were not and are 
 not ships enough and munitions 
 enough to furnish all the Allies a 
 
 [98] 
 
clear supremacy on all fronts at the 
 same time over any possible attack. 
 If the invasion of Italy is stopped, 
 it may be stopped because the 
 French and British have such a su- 
 periority on the western front that 
 they are able by counter-demon- 
 stration to divert a sufficient num- 
 ber of German divisions. Even 
 though the Italians had been given 
 the priority, the German attack 
 might have been made, with appre- 
 ciable results and more serious po- 
 litical consequences, somewhere on 
 the French line. These are all spec- 
 ulations, and speculations do not 
 count for much in war, especially 
 after the event. The essential fact 
 is that no single strategic author- 
 ity dictated the policy adopted. It 
 was the result of a competition of 
 wills. Great Britain, France, 
 Italy and our own army have all 
 been presenting without regulation 
 or reserve their maximum claims 
 upon our young and overstrained 
 organ of war production. We have 
 listened, in our eagerness to do 
 everything at once, first to one and 
 then to another. We have not been 
 able to satisfy any. The decisions 
 have been reached in detail by sub- 
 ordinate officials, and for fluctu- 
 ating reasons, rather than as a 
 whole by a central strategic author- 
 ity whose business is to plan effec- 
 tive warfare against the Central 
 Powers. The German general staff 
 has but to watch our clumsy at- 
 tempt at satisfying the conflicting 
 maximum demands of all the Allies, 
 to pick out the weak place and the 
 favorable moment, and then to 
 strike suddenly and successfully. 
 That is what the German general 
 staff has been doing ever since the 
 beginning of the war, and that is 
 what it will continue to do. 
 
 There is one all-important mat- 
 
 ter of drifting policy which Hin- 
 denburg must be closely watching, 
 and which may give him a sugges- 
 tion for his Winter and Spring 
 campaigns. Since it is publicly 
 discussed by so reverberating a per- 
 son as an ex-President, there can 
 be no violation of war secrecy in 
 referring to it. How large an army 
 shall we raise and send to France? 
 If a strategist were deciding the 
 question, he would doubtless dis- 
 cover first how much the British, 
 French and Italian armies will be 
 able to do before an American 
 force in the field can be made ef- 
 fective. He would then ascertain 
 how large a supply of munitions 
 and food from America they would 
 need to reach their maximum ef- 
 ficiency. He would subtract the 
 tonnage needed to transport these 
 supplies from the tonnage available 
 for military use in the given time, 
 and subtract the necessary sup- 
 plies from the supplies we 
 could produce in the given time. 
 The result would determine the size 
 of the expeditionary force and the 
 speed with which it must be raised, 
 trained, equipped and transported. 
 It is a complicated calculation of 
 resources as compared to demands. 
 It requires for its solution not pat- 
 riotism as opposed to pacifism, but 
 information, sound judgment and a 
 coordinated policy as opposed to 
 bluster and politics. Yet no stra- 
 tegic authority has, apparently, 
 been created to deal with this mat- 
 ter. The French, who were the 
 first to appeal for American sol- 
 diers, have now for a long time 
 been complaining of the lack of 
 tonnage to transport raw materials 
 for their own munitions, and they 
 have not secured even approximate 
 satisfaction without appealing to 
 publicity. The British do not seem 
 
 [99; 
 
to like the way in which our army's 
 demands are interfering with the 
 manufacture of their war supplies. 
 
 The prospect of such conflicts 
 was foreseen before we entered the 
 war. Some one even suggested a 
 dark design on the part of Ger- 
 many to provoke us into hostility 
 for the very purpose of bringing 
 about this complication. The Pres- 
 ident, in his war speech to Con- 
 gress, declared in favor of giving 
 to the Allies all needed priority. 
 Yet the American Priority Com- 
 mittee, because it could not base its 
 decision on a general policy mapped 
 out in advance by a central Allied 
 command, has fallen into the prac- 
 tice of giving A-l certificates to 
 the orders of our army and navy, 
 and A-2 certificates to the orders of 
 our Allies. In many cases this 
 practice may be justified, but is it 
 justified in all? And our vigorous 
 ex-President, admitting the uneasi- 
 ness on the part of the British and 
 French, publicly approves the pol- 
 icy on sentimental grounds. If 
 Hindenburg, next January or Feb- 
 ruary, should select for attacking 
 the western front a moment when 
 the British and French are insuf- 
 ficiently supplied and the American 
 army is still insufficiently provided 
 with training and equipment, some- 
 body may again get Secretary Mc- 
 Adoo on the telephone and arrange 
 for immediate priority for our Al- 
 lies. But then it might be too late. 
 
 This confusion is expressive of 
 some radical maladjustment which 
 can perhaps be best disentangled 
 by analyzing the highly significant 
 attitude of our own government. 
 Why has it insisted on an Ameri- 
 can army, as powerful as possible, 
 serving as a unit under an Ameri- 
 can general? Why did it refuse, 
 and rightly, to let this army serve 
 
 [100] 
 
 under British or French command? 
 Why are American soldiers now in 
 France rather than in Italy or 
 Macedonia? Why has war not been 
 declared against Austria, Bulgaria 
 and Turkey? It is, fundamentally, 
 because there is a distinction be- 
 tween American aims in the war 
 and the aims of some of our asso- 
 ciates, because the government 
 wishes to retain independence of 
 political action until it has some as- 
 surance of unity of political pur- 
 pose. Was not the recent behavior 
 of America, England and France 
 in response to Italian requests for 
 stronger support due in great meas- 
 ure to the disquietude of all three 
 about Italian aims in the Adriatic? 
 Will France ever delegate command 
 of her armies to any inter-Allied 
 authority as long as her chief war 
 aim is the reconquest of Alsace- 
 Lorraine? Unless the Germans 
 and Austrians are by way of being 
 completely crushed, will Italy put 
 her armies under a control which 
 might use them for the reconquest 
 of Alsace-Lorraine or even of Bel- 
 gium before throwing them to- 
 wards Trieste? The Allies have 
 separate aims, all of which cannot 
 be attained unless Germany is de- 
 cisively defeated. But the job of 
 defeating her seems to be seriously 
 handicapped by the fact that these 
 separate aims are themselves the 
 obstacles which make impossible a 
 genuinely unified command. This is 
 the fundamental weakness of the 
 coalition. 
 
 This weakness, will not, we be- 
 lieve, be wholly remedied by the 
 new machinery for obtaining unity 
 of command which has recently 
 been set up in Paris. The accounts 
 which have been cabled to this 
 country about the constitution of 
 the "war council" are meagre, and 
 
they cannot be described as wholly 
 reassuring. They have organized 
 a method of obtaining "common 
 counsel" on military affairs but 
 hardly unity of command. France, 
 Great Britain and Italy have agreed 
 to participate in a permanent In- 
 ter-Allied Council, the French rep- 
 resentative to which will be General 
 Foch and the English representa- 
 tive General Wilson, but apparently 
 this Council will not issue orders 
 for the disposition of the trops 
 and their manoeuvers. Actual com- 
 mand will still be vested in the Gen- 
 eral Staff of the several armies and 
 the new council will provide a 
 means of joint consultation rather 
 than a single military authority. It 
 will be a Council of War rather 
 than a General Staff, and councils 
 of war are notoriously poor fight- 
 ers. But this is not all. The mili- 
 tary section of the council will be 
 supplemented by a political section 
 composed of two Ministers from 
 each country, one of them the 
 Prime Minister, which will assem- 
 ble twice a month in Paris and 
 pass on the military decisions. 
 Such a provision for ultimate po- 
 litical control is, of course, only the 
 proper and necessary result of the 
 democratic institution of the sev- 
 eral Allied countries, but does it 
 not bring the arrangements for 
 unity of command back to where 
 they started? Does it not necessi- 
 tate a further attempt to base 
 unity of military policy on unity of 
 political purpose? For if the Prime 
 Ministers of the Allied countries 
 fail to agree upon their political 
 objects they will fail to agree upon 
 military plans, which, according to 
 the very nature of the case, must 
 tend to promote one rather than an- 
 other political object. The Allies 
 can no longer count upon a supe- 
 
 [101 
 
 riority of men, transports and sup- 
 plies sufficient to enable all the dif- 
 ferent fronts and the political am- 
 bitions associated with them to take 
 care of themselves. Unity of com- 
 mand involves a frugal economy of 
 decision, the selection of one policy 
 and one front rather than another 
 and a joint understandig as to the 
 result, which a victory obtained 
 upon any one front would exert on 
 the whole array of Allied political 
 objectives." 
 
 "Down the River" 
 
 'The War College building in Wash- 
 ington is three miles 'down the 
 river' from the War Department 
 building. This apparently insig- 
 nificant fact is really one of the 
 large facts in the conduct of the 
 war. It has consequences, daily, of 
 a most far-reaching sort. 
 
 Tn one of the battles on the 
 British front, in the beginning of 
 the war, two divisions were shot to 
 shreds because, simply, an error 
 had been made, a slight error, in 
 the highly complicated and extraor- 
 dinarily difficult technical task of 
 issuing clear orders from head- 
 quarters. It was a case of "bad 
 staff work." The British have been 
 compelled to get good staff work 
 and they have been compelled to get 
 a good General Staff at home and 
 they have now reached the point of 
 being able to compete on even terms 
 with the German General Staff, 
 and they have done it under the 
 pressure of a public opinion out- 
 spoken to a degree which no Amer- 
 ican can realize unless he is an 
 habitual reader of the British news- 
 papers and magazines. 
 
 The point of departure, the 
 point of start, in an appreciation 
 of the War Department is clearly 
 
the General Staff, of which the War 
 College is a part. And here it is 
 most gratifying to be able to begin 
 by saying that, in this matter, in 
 the matter of preserving the powers 
 and the possibilities of the Gen- 
 eral Staff, which has to be the 
 army's calculating brain, Mr. New- 
 ton D. Baker has performed an act 
 entitling him to thunders of ap- 
 plause, which, however, because of 
 our general lack of interest in the 
 essentials of war, he has not gen- 
 erally got. That act of his has 
 passed very widely unregarded. 
 But it should always be remem- 
 bered for him. It was a great act, 
 really worthy to be called historic. 
 Congress, in the National De- 
 fense law of last year, used lan- 
 guage which might easily have 
 been construed, and which was by. 
 many people actually construed, to 
 cripple the General Staff. Congress, 
 by nature, is inclined toward a 
 strengthening of the various non- 
 staff bureaus of the War Depart- 
 ment, such as the Quartermaster 
 General's office, the Adjutant Gen- 
 eral's office, the Judge Advocate 
 General's office, the Ordnance office, 
 the Inspector General's office, the 
 Signal Corps office, the Engineer's 
 office, and so on; and it is by nature 
 inclined to weaken the General 
 Staff or, at any rate, to push it to 
 one side. There is a good reason. 
 The bureaus, many of them, deal 
 with things in which Congress is 
 vastly interested, such as the plac- 
 ing of people and the placing of 
 contracts. The severely intellectual 
 pursuits of the General Staff do 
 not thrill Congress and, moreover, 
 they tend to bring a new impersonal 
 technical influence to bear upon 
 established personal bureau routine. 
 Certain bureau chiefs in the past 
 have known very well how to charm 
 
 [102] 
 
 Congress with the bureau idea and 
 how to leave it lukewarm about 
 the staff idea. 
 
 There was once an Adjutant Gen- 
 eral who was magnificent at this 
 sort of politics. He was a busy 
 man, but if Congressman Smith 
 wanted to know did his great- 
 great-great grandfather fight at 
 the Battle of Bennington, nothing 
 interfered with finding that out. 
 The inquirer, if he was a Congress- 
 man or a Senator, was always put, 
 by orders, straight on the Gener- 
 al's phone and"//' said the General, 
 "I will find out." A clerk labo- 
 riously did. And then, a few days 
 later, the Congressman, back on 
 the phone, heard the General say: 
 "1 have found out that your great- 
 great-great-grandfather did indeed 
 fight at the Battle of Bennington, 
 most heroically. You are indeed a 
 Son of the American Revolution. 
 And I am sending you all the pa- 
 pers myself." Decades of such 
 amenities, decades of acquain- 
 tanceships and favors, built up for 
 the bureaus a tremendous Congres- 
 sional strength, which still largely 
 continues. And therefore, even in 
 the National Defense act, in the 
 course of ostensibly, and, in many 
 respects, actually, improving our 
 military organization. Congress 
 made for itself an opportunity to 
 strike at the General Staff and it 
 did so most particularly in a sec- 
 tion containing the words "Here- 
 after members of the General Staff 
 Corps shall not be permitted to as- 
 sume or engage in work of an ad- 
 ministrative nature that pertains 
 to established Bureaus." 
 
 This section at once became the 
 theme of a very able legal opinion 
 by General Crowder, Judge-Advo- 
 cate General. If his views had been 
 accepted by Mr. Baker (and he is 
 
Mr. Baker's legal military adviser), 
 we should now have only the phan- 
 tom of a General Staff. General 
 Crowder held that the General Staff 
 could indeed give itself to the 
 "study of military problems" and 
 to "the preparation of plans for 
 the national defense" and to "in- 
 vestigating and reporting upon the 
 efficiency and state of preparedness 
 of the military forces of the United 
 States for service in peace or war." 
 But the original General Staff law 
 of 1903, passed under the influence 
 of Elihu Root, had also said that 
 the officers of the General Staff 
 should "render professional aid and 
 assistance to the Secretary of War" 
 and should act as his "agents" in 
 the delicate but most necessary task 
 of "informing and coordinating the 
 action of all the different officers 
 who are subject, under the terms 
 of this act, to the supervision of the 
 Chief of Staff." And who were 
 those officers? The law of 1903 
 named them in defining the powers 
 of the Chief of Staff. It said: 
 
 "The Chief of Staff, under the 
 direction of the President or of 
 the Secretary of War, shall have 
 supervision of all troops of the line 
 and of the Adjutant General's, In- 
 spector General's, Judge Advo- 
 cate's, Quartermaster's, Subsis- 
 tence, Medical, Pay, and Ordnance 
 Departments, the Corps of Engi- 
 neers, and the Signal Corps." The 
 Chief of Staff was to have "super- 
 vision" of all of them. But what 
 is "supervision"? What is "super- 
 vision" when Congress, subsequent- 
 ly, in the National Defense law, has 
 said that the officers of the Gener- 
 al Staff, of whom the Chief of 
 Staff is one, shall not, in supervis- 
 ing, do any administering? 
 
 General Crowder was quite clear 
 about it. He said: 
 
 [103 
 
 "Unmistakably, Congress has 
 sought to preserve untouched the 
 special jurisdiction of each of the 
 several bureaus." "It is the effect 
 of the language, and must there- 
 fore have been the purpose, of the 
 act, to re-establish the relation of 
 the several bureau chiefs as special 
 aids and advisors to the Secretary 
 of War, on matters which fall with- 
 in their special jurisdiction, unin- 
 terfered ivith by any outside 
 agency." "In all matters falling 
 within the special jurisdiction of 
 the several bureaus, Congress has 
 said in effect that the views of the 
 particular bureau chiefs shall gov- 
 ern the Secretary, so far as his own 
 judgment is to be advised." And 
 if there should be any "zones of un- 
 certainty" between the powers of 
 the bureaus and the powers of the 
 General Staff, "the statute estab- 
 lishes for us a guiding rule, which 
 is that in case of doubt the pre- 
 sumption is conclusive against the 
 General Staff." Such was the spirit 
 of General Crowder's opinion, the 
 spirit of an unusually able and 
 highly sincere and hardworking 
 and patriotic bureau chief. 
 
 Nevertheless the experience of 
 the whole world in this war turns 
 out to be that it is necessary to 
 have a strong and really powerful 
 General Staff. Mr. Baker essential- 
 ly overruled General Crowder's 
 opinion. There are times, one sees, 
 when it is not a bad thing at all 
 to have a lawyer for Secretary of 
 War. A layman might have been 
 paralyzed by the spectacle of the 
 vivid wording of the National De- 
 fense law and of the opinion of the 
 Judge-Advocate General. Mr. Ba- 
 ker looked at that torrent, observed 
 sundry cakes of floating ice on it, 
 and leaped on them lightly from 
 shore to shore with the General 
 
Staff safe in his arms. It was an 
 agile performance. 
 
 Mr. Baker reviewed the origin of 
 the General Staff. He found that 
 it was the intent of Elihu Root, 
 "one of the great Secretaries of 
 War of modern times," to give to 
 the Chief of Staff a power of super- 
 vision really effective. He found 
 that Elihu Root had said that he 
 was providing for a control to be 
 exercised over the whole military- 
 arm of the government "through a 
 single military expert of high 
 rank." He found that such also 
 was the legislative intent of the 
 words that Congress was brought 
 to use in the law of 1903. And the 
 National Defense law of 1916 did 
 not expressly repeal the law of 
 1903. Therefore all that remained 
 was to define the word "administra- 
 tive." Congress seemed to wish to 
 prevent the General Staff from be- 
 coming too "administrative." Well, 
 Elihu Root himself, strong as he 
 was for a strong General Staff, 
 never wanted the General Staff to 
 be "administrative" at all. He 
 said so, expressly. The General 
 Staff is to "inform" and "coordin- 
 ate" and "supervise." That is all. 
 But that is enough. For how can 
 it "inform" and "coordinate" and 
 "supervise" the bureaus unless it 
 goes into them deeply enough to 
 equip itself with the "qualifying 
 information"? (A splendid point 
 that.) And therefore "it is my 
 opinion that it is not only appro- 
 priate but necessary for the Chief 
 of the General Staff to pursue, with 
 as great detail as his judgment dic- 
 tates, the execution of policies 
 throughout the several bureaus." 
 And, in short, "the policy of the 
 War Department will remain as 
 before." 
 
 By that decision Mr. Baker took 
 
 [104] 
 
 us into the war with a General Staff 
 still capable, by law, in principle, 
 of being a General Staff, fully. It 
 was an act of superb insight and 
 courage, comparable to the act per- 
 formed by Lloyd George when he 
 over-ruled the gun-policy of the 
 British War Office, and bought 
 bigger guns and more guns than 
 the War Office wanted, and was, 
 by present military consent, utterly 
 right. 
 
 So the principle stands. But the 
 practice is a rather different thing. 
 Here the first fact is that stretch 
 of three miles between the War De- 
 partment and the War College, be- 
 tween the body of the army and the 
 bulk of its "informing" and "co- 
 ordinating" and "supervising" 
 brain. The results are strange. 
 
 The Chief of Staff, to begin with, 
 is separated from most of his staff. 
 He sits in the War Department. 
 Four of the six committees into 
 which the General Staff is divided 
 are resident in the War College. 
 The picture of the Chief of Staff 
 sitting in the midst of his staff de- 
 vising great plans is an imaginary 
 picture. It does not happen. In 
 fact, the Chief of Staff may express 
 an opinion on a certain highly im- 
 portant matter and shortly after- 
 wards be handed an opinion from 
 his own War College in the directly 
 contrary sense. 
 
 The next result is that the task 
 of doing any effective personal 
 friendly "supervising" of the ex- 
 ecution of policies recommended 
 from the War College becomes 
 peculiarly difficult. The War Col- 
 lege man who has recommended 
 something, after studying it, can- 
 not readily follow it, after its ac- 
 ceptance, into the bureau which is 
 operating it and make friends there 
 and help it along with fresh sug- 
 

 gestions out of his studies. It 
 may be working well. It may be 
 working badly. His faculties for 
 knowing, and for helping, become 
 very poor. 
 
 The third result is more serious 
 still. Officers in the War Depart- 
 ment in their several bureaus are 
 every day deciding things which 
 they know ought, in principle, to 
 be studied by the General Staff, 
 but "Send it 'down the river'"? 
 Never. How do we know when we'd 
 get it back? It's a beastly out-of- 
 the-way place, and it's two miles 
 by carrier-pigeon, and we haven't 
 any carrier-pigeons, and it's three 
 miles by trolley and foot, and it 
 takes too long, and this stuff would 
 go to some fellow we don't know, 
 and he might sit on it for weeks, 
 and let's do it ourselves right here." 
 And they do it themselves right 
 there. They talk about "down the 
 river" as if it were a morgue. 
 
 And the officers "down the river" 
 have behaved as if they more or less 
 agreed with them. When the war 
 broke out, they made a sort of mass 
 rush to try to get into the field. 
 General Kuhn, who was head of 
 the War College, and in whose 
 mind, if anywhere, the totality of 
 our war plans might be assumed 
 to lie, went as soon as possible 
 and took command of an individual 
 training-camp. Of the forty-two 
 officers who were his colleagues on 
 the General Staff on April 24th of 
 this year, twenty-eight have now 
 vanished. Being "the brain of the 
 army" seemed to them to be a good 
 job to leave — a point of view that 
 might provide considerable aston- 
 ishment to Ludendorff. The Ger- 
 man General Staff is a terrifically 
 immediate thing in its impact on 
 the war. Our General Staff is -still 
 regarded by our own officers as a 
 
 [ 
 
 remote thing. And the distance 
 from the War Department to the 
 War College is a symbol of that 
 remoteness. 
 
 Out of such a situation, in prac- 
 tice, one might expect great delays 
 in comprehensive planning and 
 great delays also in really compre- 
 hensive executing. Subsequent ar- 
 ticles will show that we get them." 
 William Hard 
 
 The Brain of the Army 
 
 He is President of the Panama Rail- 
 road, responsible head of the 
 Bureau of Insular Affairs, of the 
 Philippine Commission, and of the 
 government of Porto Rico. He is 
 Chairman of the Council of 
 National Defense. But let us think 
 of him only as Secretary of War. 
 Is there any other executive in the 
 world who at this moment is in im- 
 mediate charge of so many impor- 
 tant undertakings? President Wil- 
 son lays out the route of the car 
 and makes telling comments on the 
 landscape. Mr. Baker holds the 
 wheel and directs the mechanician. 
 The French and British Ministers 
 of War are now roaring along the 
 course in finely adjusted racers, 
 1918 model. They are just keep- 
 ing pace with Hindenburg. Mr. 
 Baker started in an antique run- 
 about, and as he travels he has to 
 tinker it, part by part, into some- 
 thing which can go fast and far. 
 He cannot stop by the roadside and 
 rebuild at leisure. No one can tell 
 how soon the race will depend large- 
 ly on him. His friends understand 
 that he cannot remodel everything 
 at once, but they know how pressing 
 is the necessity both for thorough- 
 ness and for speed. They know 
 that six months from now, if any- 
 thing important goes wrong, his 
 105] 
 
enemies will blame him for it. And 
 irrespective of that, everything im- 
 portant must go right. 
 
 Last week Mr. Hard showed that 
 Mr. Baker had made a good begin- 
 ning by putting the brain of the 
 army, the General Staff, where it 
 belongs, at the head of the army. 
 But he also showed that somehow 
 or other the Staff has not made 
 close connection with the nervous 
 system. It seems to be so remote 
 that hands and feet often jerk 
 along independently. Is there any- 
 thing else the matter, except that 
 the War College is three miles 
 "down the river"? No one can 
 know much about such a question 
 without having access to all the 
 information and experience tumb- 
 ling in on Mr. Baker, and more too. 
 It might be suggestive, however, to 
 compare the American organization 
 with those of our Allies, in certain 
 of the features information about 
 which is accessible in published 
 reports. 
 
 The first duty of the American 
 Chief of Staff under the law is to 
 be military advisor to the Secretary 
 of War. He can and does advise 
 on large matters, but he is a busy 
 man, he must often be away from 
 his office, and like most executives, 
 he cannot be cognizant of all details 
 without consulting his subordinates. 
 Only a few of these are in the War 
 Department building. Yet Secre- 
 tary Baker's need for detailed mili- 
 tary information is constant and 
 pressing. Many who consult him 
 must have prompt and accurate de- 
 cisions. Mr. Baker's own time 
 would be saved if there were trust- 
 worthy and informed military ad- 
 visers at his elbow. Suppose the 
 American Secretary of War, like 
 most of the European War Minis- 
 ters, had a personal military staff, 
 
 [106] 
 
 composed of trained officers who 
 had access to every paper and every 
 man in the War Office. They could 
 be animated encyclopedias for him, 
 they might even at times catch the 
 General Staff in a delay or a mis- 
 take. They could help him as no 
 other officer could who has other 
 duties besides that of gathering in- 
 formation for the Secretary's 
 personal use. 
 
 The main duty of our General 
 Staff is to plan and to coordinate 
 and supervise the work of the line 
 and bureaus of the army. It 
 should, according to the ruling of 
 Secretary Baker, "pursue the exe- 
 cution of policy through the vari- 
 ous bureaus." The European Staffs 
 have approximately the same func- 
 tions. But a study of the govern- 
 ments, notably in England and 
 France, shows that the Staffs are 
 equipped in a different way for all 
 these duties. 
 
 In the first place, the Chief of 
 Staff of almost any of our Allies 
 is a member of the supreme war 
 council — the body which roughly 
 corresponds to our Council of Na- 
 tional Defense. The European 
 councils contain the men who have 
 the information and authority to 
 decide the large questions of policy, 
 and they do decide these questions. 
 Our Council of National Defense as 
 established by law does not contain 
 the Secretary of State, the Secre- 
 tary of the Treasury, the chairman 
 of the Shipping Board, the chair- 
 man of the War Trade Board or 
 the Food Administrator. We have 
 no executive officer of any sort in 
 control of the manufacture of all 
 munitions and supplies. The Coun- 
 cil has recently developed into a 
 conference by the inclusion of Mr. 
 McAdoo, Mr. Hoover and Mr. Hur- 
 ley. It merely confers, however; 
 
it does not decide anything as a 
 body. That may be because of the 
 absence of the President (the 
 Premier of England and the Pres- 
 ident of France are members of the 
 respective councils). At any rate, 
 because the typical European coun- 
 cil decides, and because the Chief 
 of Staff is a member of it, he has 
 real authority in the army. He 
 can deliver the decisions of the 
 council to the commanders in the 
 field. He can plan the work of his 
 own staff. 
 
 It is different with us. When 
 General Pershing thinks of our 
 Chief of Staff, he thinks of an in- 
 dividual who has no connection 
 with any of the other war bodies. 
 General Bliss never confers, for in- 
 stance, with Mr. Hurley of the 
 Shipping Board, and none of his 
 subordinates ever does. When 
 Pershing wants to find out how 
 many troops he can have by a cer- 
 tain date he has to refer to a pro- 
 gram made up in the War Depart- 
 ment. He cannot be sure whether 
 any one ever asked the Shipping 
 Board upon what expectation of 
 transports and supply ships that 
 program is based. He cannot be 
 sure whether the program for the 
 requisite munitions has taken into 
 account the steel that must be used 
 for building those ships. He can- 
 not be sure that either program 
 has been checked up with the labor 
 supply. If circumstances arise 
 which must alter the program, the 
 chances are that nobody knows it, 
 or that nobody remembers to tell 
 everybody concerned until the 
 physical scarcity of ships or labor 
 obtrudes itself. The remoteness of 
 the General Staff from the conduct 
 of the war naturally disinclines 
 the army to regard it as other than 
 an aloof and secret body which 
 
 [107] 
 
 may be making perfect plans for 
 some imaginary invasion of Ba- 
 luchistan, but is not to be con- 
 sulted about large, immediate prob- 
 lems. 
 
 In the second place, the European 
 General Staffs present a strong 
 front to the War Office. They have 
 committees to study questions of 
 organization, equipment, instruc- 
 tion, transportation and operation 
 of the forces. These committees, 
 under the Chief of Staff, make the 
 decisions in military policy. The 
 policies are then carried out in de- 
 tail by the various bureau chiefs. 
 There is, for instance, a Chief of 
 Artillery who is responsible for the 
 organization and instruction of the 
 artillery branch and for the distri- 
 bution of supplies to it. There is 
 attached to him, among others, a 
 member of the General Staff, who 
 keeps him informed about the ar- 
 tillery policy of the Staff, and keeps 
 the Staff informed about the work 
 and needs of the Chief of Artillery. 
 There are similar Chiefs of Infan- 
 try, Signal Corps, Engineers and 
 so on, and each chief is linked with 
 the General Staff by a Staff officer. 
 
 But no such simple and logical 
 process goes on in our army. Our 
 Staff, to be sure, has its commit- 
 tees. We have Chiefs of Signal 
 Corps, Engineers and Coast Artil- 
 lery. But no General Staff officers 
 are attached to them. We have no 
 chiefs of the main branches of the 
 service — Infantry, Cavalry and 
 Field Artillery. We have a Chief 
 of Ordnance, who is in charge of 
 designing, purchasing and distrib- 
 uting guns and ammunition. But 
 he is not in charge of the artillery's 
 organization and training. We have 
 a Quartermaster-General, in charge 
 of buying and distributing to 
 everybody general supplies and 
 
equipment. The executive work of 
 the three main branches of the 
 service is mostly done by the Ad- 
 jutant-General — an officer who 
 nominally is appointed to preside 
 over the records. No representative 
 of the General Staff is attached to 
 the Chief of Ordnance, the Quar- 
 termaster-General or the Adjutant- 
 General. Just as the War College 
 is physically remote from the War 
 Department, so the General Staff 
 is mentally remote from the bureau 
 and division heads. 
 
 One man is supposed, in our sys- 
 tem, to be the channel for instruc- 
 tions from the Chief of Staff to the 
 rest of the army — the Adjutant- 
 General. He existed before the 
 General Staff was created, and at 
 times has held great administra- 
 tive power. The tradition of that 
 power still lingers about the War 
 Department. The decisions of the 
 Chief of Staff are transmitted to 
 the Adjutant-General for distribu- 
 tion to the line and bureau chiefs. 
 Questions arising within the line or 
 the bureaus involving general pol- 
 icy are sent in to the Adjutant- 
 General, and it is within his dis- 
 cretion either to pass them up to 
 the Chief of Staff or to decide them 
 himself. Perhaps it is this uncer- 
 tainty in the delegation of author- 
 ity that causes some of the con- 
 fusion, both in his office and else- 
 where. 
 
 In the European system the Gen- 
 eral Staff is equipped to do the ma- 
 jor planning, the coordinating and 
 the following up. The bureau 
 chiefs are equipped to do the work 
 of executive detail — that sort of 
 work which Congress felt a vague 
 need of keeping away from our 
 General Staff when it passed the 
 National Defense Act of 1916. But 
 in our system, while the General 
 
 [108] 
 
 Staff may or may not do the plan- 
 ning, it cannot do the coordinating 
 or the following up without cutting 
 across the work of the Adjutant- 
 General or of one of the bureau 
 chiefs. On the other hand, it fre- 
 quently attempts to do detailed 
 work which might better be done 
 by an executive trained in his spe- 
 cial job. 
 
 Two instances will make this 
 clear. The General Staff makes a 
 decision, let us say, to change the 
 number of cavalry units from 17 
 to 27. The Quartermaster Corps 
 hears of this change and immedi- 
 ately alters its buying to suit 27 
 units. But the Ordnance Bureau 
 does not take note of the decision 
 for weeks, and goes on supplying 17. 
 Such things have happened. Whose 
 fault is it? The law says the Gen- 
 eral Staff must coordinate the bu- 
 reaus, and Secretary Baker writes 
 that it must "pursue the execution 
 of policy through the various bu- 
 reaus." But the General Staff has 
 an alibi. It has no direct connec- 
 tion with either the Ordnance Bu- 
 reau or the Quartermaster Corps. 
 It does not even contain in its 
 membership a representative of any 
 of the purchasing bureaus. It no- 
 tifies the Adjutant-General of its 
 decision. It can do no more. 
 
 The other instance is of a con- 
 trary nature. Should promotions 
 be decided by seniority or selection, 
 and should the practice differ in 
 this respect at home and abroad? 
 A ruling was the duty of the Gen- 
 eral Staff. But the drawing up of 
 the complicated regulations was the 
 duty of a specialized executive 
 chief. Nevertheless the War Col- 
 lege painfully and at length worked 
 out a series of regulations — which 
 proved to be so imperfect that they 
 had to be revised several times by 
 
the Adjutant-General's office. It is 
 this sort of thing which makes of- 
 ficers hesitant to send questions 
 "down the river." It explains why 
 many divisions never hear of the 
 General Staff except when it issues 
 orders that no officer may wear a 
 "Sam Brown belt" while in Amer- 
 ica, or that Second Lieutenants 
 shall wear a gilt bar on the 
 shoulder. 
 
 It would be a mistake, of course, 
 slavishly to follow any European 
 example. Perhaps our government 
 can devise a new and better sys- 
 tem. But it is interesting to see 
 how well fitted the European organ- 
 izations are to give scope to the 
 General Staff for the performance 
 of the very duties which our Gen- 
 eral Staff is by law directed to per- 
 form. We may remember, too, that 
 England and France are democra- 
 cies, that their armies are worthy 
 of emulation, and that the Ameri- 
 can army is fighting in France be- 
 side them. The great and notice- 
 able difference, however, between 
 our War Department and both the 
 British and French War Ministers 
 is in the method of purchasing mu- 
 nitions. The French and British 
 have both been forced, during the 
 war, to take this duty away from 
 the artillery chief and place it in a 
 separate ministry. Neither wished 
 to do so ; they were forced to do so 
 by the inadequacy of the military 
 arm to handle immense business 
 problems. Both nations are now 
 convinced that if the military 
 branch can satisfactorily distrib- 
 ute materials, without buying them, 
 its capacity will be taxed to the ut- 
 most. Perhaps our problem is sim- 
 pler than theirs. Perhaps we have 
 better ordnance chiefs. Perhaps 
 the Ordnance Bureau is now doing 
 
 well enough. That subject must be 
 discussed in another article." 
 
 George Soule. 
 
 Retarding the Allies 
 
 'Our persistent refusal to organize 
 ourselves into a unity of command 
 for the purchasing of munitions of 
 war is very bad for the armies of 
 the Allies, just as it is very bad for 
 our own army. 
 
 All next Spring, all next Summer, 
 the Allies will shelter us. We have 
 done our best, as individuals. Not 
 one man out of a hundred at Wash- 
 ington among our chief administra- 
 tors but has given his work-time, 
 his play-time, his sleep-time, his 
 last of thought, his last of health, 
 at demand, to any duty for this 
 war. I have seen men come to 
 Washington heavy with personal 
 ambitions of private life and I 
 have seen them rise released to 
 a selflessness, to a willingness to 
 be subordinated, to be sacrificed, 
 which makes them worthy, almost, 
 to be where they are — standing be- 
 hind our soldiers. They have la- 
 bored, these men, these officials old 
 and new, usually with excellent 
 minds, often with minds of positive- 
 ly splendid power, to their utmost. 
 Nevertheless let us look at our case 
 as clearly as the Germans look at it. 
 
 The Germans know that not for 
 a moment in any month of next 
 year shall we be able to be as much 
 as ten per cent of the genuine fully 
 trained, fully equipped, fighting- 
 line effectiveness thrown up against 
 them on the frontier of democratic 
 civilization between the Adriatic 
 and the English Channel. Not ten 
 per cent of it, in the immediate 
 military sense. The Germans know 
 this. We really know it. Let us 
 really admit it, and act on it. 
 
 [109] 
 
We must make every effort to get 
 supplies into the hands of the Allied 
 armies as smoothly, as steadily, as 
 flowingly, as possible. We shall 
 not starve our own army, or even 
 in any slightest way stint it. We 
 cannot train enough men in two 
 years to consume our industrial re- 
 sources. We have a surplus. It 
 is for us to see that the Allies get 
 that surplus with the minimum of 
 daily delay and with the maximum 
 of daily rapidity. We must do it, 
 and we want to do it. 
 
 But we cannot do it, we cannot 
 conceivably do it, with our present 
 organization. The minimum of de- 
 lay, the maximum of rapidity, every 
 twenty-four hours, means unity. 
 And our present organization is an 
 outrage against unity. 
 
 For look at it. In our War De- 
 partment we have those well known 
 separate purchasing divisions 
 (Quartermaster, Ordnance, and so 
 on) which, being separate, have to 
 be "coordinated." Nobody at Wash- 
 ington denies the need of getting up 
 early in the morning and "coordin- 
 ating" all day long. George Porter, 
 head of the Section on Cooperation 
 with States in the Council of Na- 
 tional Defense, has offered a re- 
 ward to anybody who can think up 
 a word that will mean "coordinate" 
 and that will not bore everybody 
 sick. The first thing that "coordi- 
 nates" the purchasing divisions in 
 the War Department is the General 
 Staff. 
 
 Well, the General Staff is indeed 
 a "coordinating" body. It must 
 "coordinate" the War Department 
 for military purposes. The General 
 Staff is a vital thing, an indispen- 
 sable thing, in the matter of "co- 
 ordinating" the War Department 
 for military purposes, for fighting. 
 But what sort of thing is it in the 
 
 [110] 
 
 matter of "coordinating" the War 
 Department for purchasing pur- 
 poses, for industrial purposes, for 
 purposes having to do with factor- 
 ies and the control of factories 
 and the control of the capital 
 and of the labor in factories? 
 Who are on the General Staff? 
 Soldiers. Soldiers taken from the 
 "line." Rightly. They are to be 
 the army's military brain. They 
 have come from army-posts. They 
 have studied troops. That is what 
 they know. That is what they are 
 for. Their knowledge of industry, 
 their knowledge of the feelings of 
 the people in industry, is, for the 
 most part, nil. 
 
 One of our most famous generals 
 opened an official conference last 
 year on the subject of Labor on 
 American Railways by remarking, 
 most interestingly: "I am against 
 trade-unions." It was really too 
 bad that John Ruskin could not 
 have materialized out of his grave 
 at that moment to say: "And I 
 wish to remind you that I am 
 against all locomotives, steam, elec- 
 tric, internal -combustion, and 
 other." One of the best ways to 
 try to get a Bolsheviki revolution in 
 this country would be to allow our 
 generals to become important in the 
 control of industry. And the pur- 
 chasing of munitions, in the end, 
 here as in Britain and as in France, 
 is nothing less than the control of 
 industry, of all basic industry. 
 
 Therefore the General Staff, as 
 constituted, being a military brain 
 and not an industrial brain, is in- 
 capable of really "coordinating" 
 and accelerating the War Depart- 
 ment's purchasing divisions; and 
 therefore, for this reason, as well 
 as for other reasons, we now have 
 a new "coordinating" body within 
 the War Department — the "War 
 
Council" — consisting of certain bu- 
 reau-chiefs and ex-bureau-chiefs 
 among whom there are men, like 
 General Sharpe and General Cro- 
 zier, who have had recent purchas- 
 ing experience. 
 
 It is too soon to be sure just what 
 this new "War Council" can do. 
 One thing, though, may be said 
 about it safely. Part of its pur- 
 pose is to take certain people and 
 "kick them up politely to the 
 Lords." The difference is that 
 when you kick Sir Edward Grey 
 up into being Lord Grey, you are 
 through with him. We are not 
 through with General Sharpe. 
 Under General Sharpe, acting as 
 Quartermaster-General, many of our 
 soldiers shivered and died in thin 
 khaki. General Sharpe's purchas- 
 ing division did not succeed in giv- 
 ing them woolens. For such fail- 
 ures General Sharpe is held respon- 
 sible, rightly or wrongly, within the 
 War Department as well as outside 
 it ; and he is removed from acting as 
 Quartermaster-General ; and Gen- 
 eral Goethals is asked to act as 
 Quartermaster-General; but Gener- 
 al Sharpe is asked to sit among the 
 five men who are to "coordinate" 
 General Goethals. What are Gen- 
 eral Sharpe's chances, what are 
 General Crozier's chances at "co- 
 ordinating" General Goethals? 
 Just about what Mr. Denman's 
 were. 
 
 There is only one sort of "co- 
 ordinating" body worth while in 
 the internal organization of Wash- 
 ington. This sort of "coordinating" 
 body must have two characteristics. 
 It must consist of the top man, the 
 strongest men, in its field; and it 
 must have the power not merely to 
 nag but to order, to compel, out- 
 right and forthwith. There is no 
 such "coordinating" body in all 
 
 [ill] 
 
 Washington. That is why the word 
 "coordinate" is now a stench in the 
 nostrils of the town. 
 
 But we are not yet finished with 
 "coordinating" our purchasing di- 
 visions. We now come to the War 
 Industries Board. And we come to 
 the Purchasing Commission within 
 the War Industries Board. Let us 
 follow the Allies to this Purchasing 
 Commission, from which they get 
 their permits for purchases in this 
 country. 
 
 They wish to buy, let us say, an 
 important finished product. In the 
 matter of the raw material out of 
 which that product is to be made, 
 they see Mr. Baruch. In the mat- 
 ter of the product itself, they see 
 Mr. Brookings. Now Mr. Brook- 
 ings is a very fine person, of high 
 intelligence; but, by virtually uni- 
 versal consent, he lacks the one 
 thing a man in his present position 
 must especially and conspicuously 
 have. He lacks speed. He is slow 
 at decisions. People in the War De- 
 partment complain that they send 
 things over to him and he keeps 
 them, and then keeps them some 
 more, and then may return them 
 with the observation that he has 
 nothing to suggest. He is a desir- 
 able man for some place in the 
 government. But it is not given even 
 to desirable men that they should 
 have all desirable qualities fitting 
 them for all places. Flatly, by con- 
 sent of virtually all persons who deal 
 with him, Mr. Brookings does not 
 fit the Purchasing Commission : be- 
 cause our purchases must be made 
 with speed and Mr. Brookings hap- 
 pens to be quite without speed. 
 
 But what can be done about it? 
 Observe! The Purchasing Com- 
 mission has no head. It consists 
 of Mr. Baruch, Mr. Brookings and 
 Judge Lovett. They are equals. 
 
No one of them can dismiss either 
 of the others. 
 
 So we must go higher. The 
 Purchasing Commission is part of 
 the War Industries Board, and Mr. 
 Willard is chairman of the War 
 Industries Board. Perhaps he could 
 make a change? Not at all. He 
 is merely the "chairman" of a 
 "board." Mr. Brookings is not his 
 subordinate. He is really his col- 
 league. 
 
 So we must go higher still. The 
 War Industries Board reports to 
 the Council of National Defense. 
 Perhaps the six cabinet members 
 who constitute the Council could 
 make a change? Perhaps. But 
 only very perhaps. Mr. Brookings 
 was appointed by the President 
 himself. And what does that mean ? 
 
 It means that under Mr. Baker, 
 who is chairman of the Council of 
 National Defense, and under Mr. 
 Willard, who is chairman of the 
 War Industries Board, and within 
 the Purchasing Commission, three 
 layers from the top, we have a pres- 
 idential appointee, whom nobody 
 will or can pick out and transplant 
 until the President himself looks 
 and learns and is informed and 
 speaks. 
 
 Is this good organization? Is 
 this the way to lighten the burdens 
 of the President? Is this unity 
 Unity requires that every field of 
 general action, such as ships, such 
 as munitions, such as food, shall 
 have a single head, with power to 
 control all other men in that field. 
 We have this single head in food. 
 We begin to have something like it 
 in ships. We have nothing like it 
 in munitions. 
 
 For let us proceed in company 
 with the Allies. Mr. Brookings is 
 about to decide whether or not to 
 allow the Allies to use certain of 
 
 [112] 
 
 our factories. But he must find 
 out whether or not our War Depart- 
 ment wants those factories. He 
 must consult, for instance, our 
 Chief of Ordnance. Our Chief of 
 Ordnance may arrive at a certain 
 view. Mr. Brookings may arrive 
 at a certain other view, or may re- 
 main in doubt. Then we may have 
 a meeting of the whole War Indus- 
 tries Board. 
 
 But the War Industries Board, 
 even as a whole, has no real right 
 to coerce its own internal Purchas- 
 ing Commission; and it most cer- 
 tainly has no real right to coerce 
 the Chief of Ordnance. Therefore 
 the decision, in important disputed 
 cases, lags. In one such case it has 
 been lagging now for several weeks. 
 Everybody concerned has known all 
 the facts. Nobody concerned has 
 been able to say "Absolutely, Yes" 
 or "Absolutely, No." 
 
 But we proceed again. The de- 
 cision has been reached. The Pur- 
 chasing Commission has author- 
 ized a purchase for the Allies. And 
 Judge Lovett, as head of "priority" 
 within the Purchasing Commission, 
 gives that purchase a "priority 
 order." Simultaneously the pur- 
 chasing divisions in the War De- 
 partment are issuing thousands of 
 "priority orders" on purchases for 
 us, purchases important, purchases 
 unimportant. All these purchases, 
 the important ones and the unim- 
 portant ones together, start from 
 their factories and rush toward 
 their destinations on equal terms. 
 Sawdust to be used in the packing 
 of ice for our army in France may 
 have just as good a chance of get- 
 ting to the seaboard as the material 
 for explosives for the Allied guns. 
 And we will find space on our ships 
 for all sorts of strange shipments, 
 remotely useful, when things of in- 
 
stant use for the French Army are 
 lying on the docks. 
 
 Why? Because we persistently 
 refuse to unify. We prefer to "co- 
 ordinate." 
 
 Have we not had about enough of 
 it? It makes our ablest men look 
 like fools. Perhaps Mr. Brookings is 
 not so indecisive as people in the 
 War Department think he is. He 
 is working in the midst of an in- 
 decisive system. If he were work- 
 ing within a unified system, he 
 might turn out to be a perfectly 
 effective man. For unity brings 
 responsibility, and it brings ur- 
 gency, and it brings the necessity 
 for action. 
 
 Imagine all these purchases that 
 we have mentioned, and all these 
 priorities, massed under one man. 
 The War Industries Board is his 
 General Staff, an industrial General 
 Staff, an industrial brain. It is 
 the beginnings of it. The present 
 purchasing divisions in the Army 
 Department become subordinate, 
 bodily, directly, to this one man. 
 Their present chiefs become his 
 assistants. He is our Head of War 
 Supplies. He is not the head of a 
 fragment, the submerged head of a 
 dislocated fragment, of our War 
 Supplies. He stands out. He may 
 report to the President ; or he may, 
 as some people suggest, report to 
 Mr. Baker. In either case, he will 
 be the Organizer and the Controller 
 of American War Industry; and 
 there will fall on him the same 
 glare of public interest and of pub- 
 lic demand that now falls on Mr. 
 Hoover and on Mr. Hurley. If Mr. 
 Brookings then is found to be slow, 
 this man, for self-preservation, will 
 let him out, just eaxctly as Mr. 
 Hurley has let out Admiral Capps 
 
 and Admiral Harris. But now? 
 Who now is responsible for Mr. 
 Brookings? The President. The 
 Chairman of the Council of Nation- 
 al Defense. The five other members 
 of the Council of National Defense. 
 The Chairman of the War Indus- 
 tries Board. Totaling, in practice, 
 nobody. 
 
 So we get slowed. And so the 
 Allies get slowed. And the War 
 Industries Board goes on "coordi- 
 nating" the War Department with a 
 chairman who has no real right even 
 to "coordinate" the Board. And the 
 General Staff of the Army goes on 
 "coordinating" the purchasing di- 
 visions of the War Department 
 with a brain belonging to the army- 
 post and the field of battle. And 
 the new "War Council" will begin 
 to "coordinate" a new lot of bureau 
 chiefs, chosen for reputed strength, 
 with the help of a complement of 
 ex-bureau chiefs, discarded for re- 
 puted weakness. And Mr. Baker 
 and Mr. Wilson, in the midst of this 
 cloud of petty executives and palav- 
 ering "coordinators," disappear to 
 Olympus. And we get some speed. 
 We get much speed. But we do not 
 get top speed. We do not get any- 
 thing like top speed. And just over 
 the horizon is the portal to which 
 every Ally, in its turn, has come, 
 the portal bearing the famous words 
 Lloyd George has repeated to us, 
 words which, if they flash out there 
 when we arrive, are the death war- 
 rant to our form of democratic 
 government in this world: "Too 
 Late." Too Feeble and Too Late. 
 The future will then be either to 
 Hohenzollerns or to Bolsheviki. 
 Constitutional irresolute democracy 
 will have come to its end." 
 
 William Hard. 
 
 [113] 
 
XVIII 
 
 No More Half-Measures 
 
 The remedy is simple in principle. At first it 
 seems undemocratic because it involves dictator- 
 ship, undisputed authority, the mechanism to en- 
 force command, and perforce the wherewithal 
 to command intelligently. 
 
 Democracy should not make itself an enemy 
 of efficiency. On the contrary, efficiency should 
 be its legitimate slave in order that the human 
 being, single and collectively, may rise to the 
 highest safety and opportunity. Democratic 
 dictatorship therefore merely means concentrated 
 authority controlled and approved by the people. 
 Our President has already concentrated power 
 unequalled in this world. We do not fear the 
 President. In fact for years the nation has been 
 steadily granting him increased powers. But 
 we have not required the President to use his 
 great powers with adequate effectiveness even in 
 peace times. 
 
 War is the speedy application of concentrated 
 power. And we are leaving our President par- 
 tially helpless — history will place the blame. 
 
 Congress by cooperating continuingly (not 
 spasmodically, considering the deed accom- 
 plished) can, first, provide legislation correct in 
 principle, second, refine and expand it intelli- 
 gently. 
 
 Congress might well appoint a permanent 
 Congressional committee to include some of its 
 ablest constructive, far-seeing and organizing 
 minds. With a minimum of interference and a 
 maximum of helpfulness the Committee would 
 
 [114] 
 
receive periodical reports from the leading execu- 
 tive officials outlining plans, progress and defi- 
 ciencies. With such a steady supply of infor- 
 mation Congress would be in an excellent 
 position to legislate most constructively to fill 
 the gaps, to strengthen and revise existing laws 
 wherever necessary. 
 
 1I5J 
 
The Public Is Discovering : 
 
 The President has not always had available the 
 information necessary to indicate what needed 
 his foremost action and support in: 
 
 a. Forming adequate organization plans. 
 
 b. Obtaining precedence for the most pressing 
 needs, under their fluctuating relationship month 
 by month. 
 
 c. Weighing the future and anticipating needs 
 and developments. 
 
 d. Insuring against every possible neglect or 
 miscarriage of decision, action and plan. 
 
 e. Foreseeing and thwarting all obstacles. 
 
 f . Achieving speed to win. 
 
 The President's executives have labored with 
 equivalent difficulties. 
 
 [H6j 
 
To Avoid Sacrifice — 
 Perhaps Defeat — 
 
 Eliminate : 
 
 Government by coequals and titles. 
 Government by debating society committees. 
 Government by followers instead of leaders. 
 Government by hindsight and complacency. 
 Government by chance and request. 
 Government by installments. 
 Government by prejudice and inflexibility. 
 Government by censorship. 
 Government by delajr and hesitation. 
 
 Correct fundamental organization principles 
 let details take care of themselves. 
 
 For victory's sake: — 
 
 The American public confidently awaits this 
 achievement from a sympathetic Congress assist- 
 ing unselfish executives. 
 
 [117] 
 
Must the Public 
 Now Force the Remedy? 
 
 We must strengthen the two weakest spots of the 
 national executive system: 
 
 a. Between the President and the 
 complex group of executives and ad- 
 ministrators dependent upon his deci- 
 sions and policies. 
 
 b. Between the leading executives 
 and their righthand men dependent 
 upon their chiefs' decisions and plans. 
 
 By 
 
 Having each executive free from detail. 
 
 Giving each executive condensed, sifted vital 
 information. 
 
 Organizing each executive for and with instant 
 daily decisions. 
 
 Providing each executive with careful plans, 
 studied policies, organized suggestions. 
 
 Supporting each executive with constructive 
 vision, operating efficiency. 
 
 Demanding of each executive adequate checks 
 and safeguards against failure, oversight, 
 misunderstanding, scandal, scarcity and delay. 
 
 Requiring each executive to know what is most 
 urgent each day — and months ahead. 
 
 Furnishing each executive with the right man for 
 the right place — systematically. 
 
 And 
 Providing more concentrated authority. 
 
 [118] 
 
Authority 
 
 The information given in this pamphlet is 
 based upon facts, experiences and sugges- 
 tions resulting from nine months in War 
 Washington. The assistance of a staff of 
 trained investigators, statisticians and aids 
 has been utilized at a cost of many thousands 
 of dollars contributed by a private citizen 
 with no axe to grind, anxious solely to serve 
 his country constructively, without fear or 
 favor, in this time of need. The organization 
 problem has received the attention of several 
 men familiar, through successful construc- 
 tive business experience in both large and 
 small corporations, with the principles of 
 organization and their application. 
 
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