Henry A. Wallace, Business Measures

Selected Works of Henry A. Wallace

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Business Measures

Henry A. Wallace

An article from American Magazine, March, 1943.
From Henry A. Wallace, Democracy Reborn (New York, 1944), edited by Russell Lord, p. 208.

Businessmen realize that the shock of this war's end will probably be at least seven times as great as that which was felt beginning in 1920. Peace unplanned could be a disaster worse than war, wrecking business, labor and agriculture throughout the entire world and producing revolution arid misery among the millions.
No businessman can plan for the future with any certainty so long as there is the fear of war on the horizon. It is vital, therefore, that the United Nations' covenant must provide the machinery to assure "freedom from fear"—an international peace law, an international peace court and an international peace force. If any aggressor nations take the first step toward rearmament, they must be served at once with a "cease and desist" order and be warned of the consequences. If economic quarantine does not suffice, the United Nations' peace force must at once bomb the aggressor nation mercilessly.
To guarantee the peace, the United Nations will need additional powers. We must prevent international cartels of the German type and perhaps substitute for them a United Nations agency to restore stable conditions in raw-material markets, on price terms that assure producers fair incomes and promote expanded consumption.
To prevent worldwide unemployment, there will probably have to be a United Nations investment corporation, under whose direction public and private capital can be put to work for worldwide reconstruction. If unemployment could be prevented without the use of government funds, there would be no need for such a corporation. But the postwar impact resulting from the sudden cessation of tremendous governmental spending everywhere in the world will make it absolutely necessary for governmental investment capital to be used on a very large scale to prevent the sudden and complete destruction of the capitalistic system.
This will not necessarily mean the reduction of private initiative. On the contrary, private initiative probably will be increased.
In launching such an investment program, the establishment of a network of globe-girdling airways ought to be the very first order of business.
After the peace of the world has been made secure, it should be possible to internationalize the large airports. The war has already brought the construction of many new airports, most of them for military purposes. With the coming of peace, and the expansion of commercial air service, many more will be needed. Boldness should be the guiding principle in planning a worldwide airport-construction program. When this war ends we shall be only at the threshold of the coming air age. Freedom of the air means to the world of the future what freedom of the sea meant to the world of the past.
Air travel will have an indirect but far-reaching effect on economic development. As people travel from country to country with greater ease, possibilities for utilizing the world's resources will be seen by men of daring and imagination, and they will lead the way in organizing new industrial projects of all kinds.
Boys and girls of the rising generation are already air-minded to a degree which is not possible far most of their elders who grew up earthbound. Educational courses in the future might well include airplane trips to one or more foreign countries. It is infinitely more important to make the people of the United Nations space-minded for peace than it was for Germany to make its people space-minded for war.
Rivaling aviation in its effect on future business development will be highway transportation. We in the United States can realize from our own experience what highways mean, for highways have been as essential as automobiles and motor trucks in the transportation revolution in this country in the last three decades.
One great road project which has been under way for nearly twenty years, and which is now within sight of completion, is the 9330-mile Pan-American Highway, extending from Laredo, Texas, to Buenos Aires, Argentina. This highway, known as the "lifeline of the Americas," is a monument to the co-operative spirit of the Western Hemisphere republics.
There will doubtless be a close relationship between airways and highways which follow the same intercontinental routes. To some extent, airports will be located along the highways, and both the airways and the highways will be fed from the same streams of commerce.
Improved transportation will be the key that will unlock the resources of the vast undeveloped regions of the world. We may expect the history of those regions in the next hundred years to parallel our own history in the last hundred years.
One of the great dramas of American history was the winning of the West. Following the War between the States, the railroads crossed the prairies at the rate of a mile a day. Farmers, ranchers, miners, cities, churches and schools followed.
A similar drama, unsung as yet, has been taking place in the Old World, as Russia has been winning her East. Most of Siberia, at the time of the fall of the Czars, was little more than wasteland occupied by Eskimos, herdsmen and political exiles. Less than sixteen million people occupied a land area twice as great as the United States. Today over forty million people live in the same area, with its new Siberian Pittsburghs, Bostons, Detroits. Great power dams, great mines and great factories are operated in a giant new industrial system. On the farms are tractors by the tens of thousands.
What the United States has done and what Russia is doing give a clue to what is possible in such regions as China, Alaska and Latin America.
China has coal, iron and other resources essential for industrial progress, but first must come improvement of agricultural production and transportation. More capital is one of China's primary needs, but even more she is in want of technical skill and guidance to utilize her resources effectively. It is in providing such guidance that the United States and the other United Nations can perhaps be of the most help.
Another region rich with new possibilities of industrial and agricultural development is the great Northwest—including Alaska, western Canada, and the northwestern portion of the United States. To such previously existing industries as fishing, lumbering and mining, the war has added shipbuilding, aluminum production and airplane manufacture. When peace returns, the Alcan Highway and other new transportation routes will lay the basis for further progress, and, with plenty of water power available, there will be the opportunity for great expansion in all the industries utilizing the mineral and forest resources which abound in the region.
Perhaps most challenging to the imagination of the modern businessman is the vast land of Latin America to the south.
An important point is the degree to which the projects can be made completely self-liquidating. Of course, in a broad sense, a loan to a government may be considered to be self-liquidating if it is used to build up the productive power of the country and results in an increased capacity for repayment. But many of the projects I have in mind would be self-liquidating even in the narrower sense.
The experience of our own Tennessee Valley Authority throws some light an what may be achieved through careful planning and skillful engineering. This experiment in regional planning, begun nearly ten years ago, has been a striking success.
There are practical people in the United States who believe that we have the "know-how" to help many of the poverty-stricken peoples to set their feet on the path of education, manual dexterity and economic literacy. If American missionaries of a new type, equipped with this "know-how," can work in co-operation with a United Nations investment corporation to develop flood-control works, irrigation projects, soil reclamation, rural electrification and the like, it will make possible an expansion in half the area of the world reminiscent of that which was stirring in our own land during its rapid growth from 1870 to 1910.
The new missionaries; if they are to make, their dreams come true in a really big way, must be able to grasp the enormous possibilities of combining governmental credit and organization with the drive of private initiative. The possibilities are all there—all just as practical and feasible as the growth of the United States.
To shift successfully from ninety billion dollars a year war production to ordinary peacetime activity will require the greatest resourcefulness and determination, the greatest outpouring of industrial energy, and the finest co-operative spirit among businessmen, farmers, workers, professional people and government officials that this country has ever seen.
Labor must go beyond hours, rates of pay and working conditions and, through the appropriate agency of government, co-operate vigorously with business in programs for full employment.
Agriculture must, through the appropriate agency of government, see that the parity principle now written into law operates justly under changing conditions of production and is effectively applied to feed the largest number of consumers at a reasonable price.
Businessmen must, in their governmental relationships, go much deeper than the customary consideration of taxes, economy, and disdain for bureaucrats. They must work actively with appropriate agencies of government in the administration of policies which will best increase productive power, balanced by an ever-increasing consumptive power flowing from a prosperous agriculture and from labor fully and productively employed.
The war, with all its hardship and its pain, has brought one blessing—it is providing a job for everybody who wants a job. We should resolve now that victory will not rob us of this blessing.
Much of the task of shifting to peacetime activity will have to rest upon the shoulders of the businessmen. In their task they will have the inspiration of the great progress of technology, accelerated by the war and the nationwide research programs organized by men in the armed services.
If the businessmen are engaged in home construction, they will have many new materials and devices to work with. If they are in automobile manufacturing, they will be able, through the use of aluminum and plastics, to produce cars that are lighter, more efficient, more comfortable and cheaper to operate.
If they are merchants, they will find a host of new products on the market, as the wartime accomplishments in making plastics are translated into peacetime goods. If they are in the food business, they will have the thrill of offering the public many new types of dehydrated and compressed foods, developed by the Army for the convenience of soldiers but adaptable to peacetime use. If they are in aviation, they can look forward to the introduction of the helicopter and the great changes and opportunities this type of plane will bring.
In nearly every country of the world one of the most feasible projects will be construction of low-cost houses on a scale never before contemplated. Few people realize the multitude of construction devices and gadgets of all kinds which are available to make houses livable at lower cost. Here in the United States the possibilities are enormous. The field for new and better rural housing has scarcely been touched. In cities, the problem goes far beyond the matter of slum clearance and rehabilitation of blighted areas. It involves the construction of houses for individual ownership and of houses for rent by those people whose work forces them to shift their residence frequently.
If each of the United Nations will do its duty for its own people on the housing front, a considerable part of the postwar unemployment problem can be solved. But no matter how far the respective United Nations go with regard to housing projects and the expansion of normal consumption goods industries, there will be wide-scale unemployment unless some united agency is prepared to plan and finance on a self-liquidating basis international airports and similar projects of the greatest significance to the peace and prosperity of the entire world.
With all the initiative and daring of the businessmen, it is doubtful if, in the short time they will have, they can make the ninety-billion-dollar shift by their own efforts alone. They will need the help of government in various ways—the cushioning effect of "dismissal wages" for workers leaving war jobs, of "discharge bonuses" for men leaving the Army and the Navy, of plans for an orderly cancellation of war contracts, of provisions that will encourage the smaller companies to buy the war production plants from the government.
They will need the help of financial and tax policies which favor the maximum of individual incentive, but which do not shut out the rapid flow of government funds when these may be necessary for full employment. They will need the protection of government insurance of business transactions, as so successfully worked out in the guarantee of bank deposits and in the insurance of home mortgages under the Federal Housing Administration.
They will need the protection of the social-security system, broadened and strengthened. Social security is a splendid method of easing the individual worker and the business community over the rough spots. But we should recognize that the United States does not yet have a mature economy, and we should not look to a social-security program as a substitute, for dynamic, creative business energy and initiative.
In the situation that will face the United States and the world after the war, one might like to follow this course or that, according to his own personal inclinations. But, as is so often the case in the life of the individual, the decision comes down to a choice between very definite alternatives. On the one hand, the people of our country and of the world will have an opportunity to act boldly and imaginatively to organize the greatest utilization of the world's resources that history has ever seen. On the other hand, we confront the alternative prospect of suffering from a disillusionment like that which began in 1930—a disillusionment which will end inevitably in World War III, if not in a collapse sooner in the form of an epidemic of insurrections and revolutions, or the loss of democracy and the sinking into a state infinitely more static and regimented than the life of the Middle Ages.
The American businessman will rise to the challenge of the air age, to the challenge of the new frontier, to the infinite possibilities for development not only in our own country, but in the tropics and in Asia. Just as he has co-operated with government in time of war to build planes for the saving of civilization, so will he co-operate with government to make air power the preserver of civilization.
More and more, everyone will recognize that business, labor, agriculture, and government have just one job in their four-way partnership: to lead the common man to full employment, a higher standard of living, and a peace which will be permeated by the exciting spirit of new frontiers. The creative businessman of the future will recognize that, while government will play a large part in opening up these new frontiers, the government activity will be such as not to reduce but to increase the field for private initiative. Better government organization and more individual drive will go hand in hand.
The peace to come will be just as worthy of a supreme effort as the war is now. The men in the armed services are too intelligent to permit a dull, dead, dragging peace which will let the world drift into the maelstrom.
Airplanes and air power have eliminated the old significance of national boundaries. International airports and extensive international air travel will cause the American businessman to think in international terms as never before. The narrow selfishness of the past will more and more seem foolish and harmful. The seas will no longer separate the continents in the way they once did. Information and goods will flow with ever-increasing freedom.
Modern technology, the wings of the air, and the waves of the air mean that the common man will demand and get a better education and a higher standard of living. In serving the common man, the business leader will have opportunities for initiative such as he never dreamed of before.

Introduction | Essay | Documents | Resources

Selected Works of Henry A. Wallace

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