The Struggle for Raw Materials


By WILLIAM L. BATT, Deputy Commissioner of the Industrial Materials Division of theNational Defense Advisory Commission

Delivered at the Herald-Tribune Forum, October 22, 1940

Vital Speeches of the Day, Vol VII, pp. 119-120

THE subject I have been asked to discuss with you tonight is raw materials. It is a big subject—much too big to cover adequately in a mere quarter of an hour. And it is a vitally important one—one that we all should recognize as a basic problem of an industrial nation and therefore of modern war. For modern war means mechanization, and mechanization means raw materials, especially minerals—and lots of them.

Let me recall to you a few events of recent history—events that constitute milestones down the road to the war now blazing on three continents and threatening to spread still farther. In 1932 Japan took Manchuria, largely upon the excuse that she needed raw materials; in 1935 Italy invaded Ethiopia, largely upon the excuse that Mussolini's growing nation needed raw materials—in this case oil; from 1933 to 1935 Germany cried out for a greater share of the world's natural wealth, and since 1938 has invaded or occupied ten other countries, frequently upon the excuse that she needed—and had a right to—more raw materials.

Was It a Smoke Screen?

I know that most of you will say that in each case I have just cited, the alleged need for raw materials was a mere smoke screen thrown around the insatiable lust for political and military power on the part of dictatorial regimes already reeling with the intoxication of their own might.

I will not—and of course do not—dispute these points. I am not seeking here the underlying causes of this catastrophe. Nor am I trying to develop any nostrums for preventing its recurrence in years to come.

I do, however, want to point out as forcefully as I can the vital role of raw materials in world politics; to impress upon you the importance of raw materials to the course of this war, and to stress their absolute essentialness to our own national defense program. For without iron, and coal, and tin, and copper, and chromium, and bauxite, and tungsten, and a long list of other things dug from the earth no nation can have planes, tanks and guns, or even maintain its normal peacetime existence.

How, then, could Germany have built the greatest military machine ever seen when everybody knows that she is desperately short of many of the materials I have just said are vital to an arms program? Despite the sensational development of ersatz materials, the real answer is that the people of Germany went without butter and lots of other things that we consider to be necessities of day-to-day living so she could build up stock-piles of raw materials in great quantities to turn into instruments of war, and have something left over for a reserve.

British and U. S. Supplies

Yes, I know that other countries did the same thing to a limited extent. I know that France stored up large reserves of manganese and gasoline and other essentials. But when the showdown came, France did not use her raw materials resources to good advantage. Of course, I do not claim that any belligerent which has greater supplies of raw materials than its enemy will necessarily win the war; theymust be put to good use. Raw materials may not win wars, but lack of raw materials can and have lost them.

Fortunately for us, Great Britain and the United States between them control approximately three-fourths of tie world's minerals. The classification "minerals" does not, of course, include all essential raw materials. It leaves out such important items as rubber, leather, silk and quinine. But minerals constitute the most important single category of materials to an industrial nation, especially if that nation is building up its defense.

Of course, you might ask me, "What are these minerals?" Manganese, chrome, tungsten minerals absolutely essential in the making of iron and steel. Mercury, a requirement in the detonator of our cartridges. Mica, an essential of insulation in our radios and spark plugs of aviation engines. Tin. I don't have to tell you what tin is used for. These are some of the essential materials, essential minerals which our industrial machine and our war machine must have.

Now, we like to refer to this country as the greatest industrial nation on earth. We boast of our ever-expanding industry and our technological advances. We have a right to be proud, but we must not forget that our increasing industrialization has had the inescapable result of making us less and less self-sustaining and has required the importation of more and more raw materials from abroad. This, in my belief, has been a completely healthy development. For if we do not buy raw materials from foreign producers, they do not have the dollars with which to buy our manufactured products and agricultural surpluses. We have deplored, and rightly so, the folly of economic nationalism. We have preferred the unhampered exchange of goods among the nations. But that concept of trading has been smashed, temporarily at least, by the hammer blows of war—economic and military.

Needs of America

As a result of our industrialization, based upon access to foreign markets, the United States today is the world's largest producer, largest processor and largest consumer of minerals and many non-mineral basic raw materials. We normally use about 60 per cent of all the rubber produced in the world, about 40 per cent of the world's production of tin, about 45 per cent of the world's chromium, 56 per cent of silk, 40 per cent of nickel, 40 per cent of vanadium, 36 per cent of manganese and 33 per cent of antimony. Some of these things are not produced at all in this country; others in insufficient quantities or inferior grades. Despite the fact that the United States, by accident of nature rather than by national policy, comes closer to self-sufficiency than any other political unit on earth, we find it necessary to import substantial quantities of fifteen industrial minerals, and a number of other raw materials.

And today we are face to face with the grim prospect that our access to many of the great producing areas of those commodities in which we are deficient may be cut off by the action of an unfriendly power or powers. We hope that this may never happen. But elementary prudence demands that we seek a solution with all the energy and speedat our disposal. This is the particular task of the Industrial Materials Division of the National Defense Commission, with which I am connected. It is our job to see to it that our whole defense program does not bog down at the source because our great manufacturing plants cannot get enough tin or rubber or tungsten.

How do we go about this job, and what are the prospects of success? Fortunately, we did not have to start from scratch. The Army and Navy Munitions Board had studied this problem for a period of many years with the advice of outstanding civilian experts, some of whom are working with us on the Defense Commission today. We began by taking their studies and relating them to the specific armament program recommended by the President and accepted by Congress.

Methods of Increase

We had to include in our calculations normal and sometimes increased uses of these materials for civilian consumption. Wherever shortages were found, we set out to try to fill them by one, several or all of a number of methods. The obvious first approach is to increase domestic production, if there is any. This has been done in connection with several materials without our province, but to a limited extent only, because our domestic producers of basic materials, usually benefited by tariff protection, already were producing about as much as they could. Furthermore, the development of new domestic sources is usually a long-range project, and while this is being promoted in every feasible instance, there is a pressing time element in this program.

The next alternative is to find new sources close enough to home so that there may be reasonable expectation that access to them will not be disrupted. This, too, has been done in some cases. Naturally we are glad to help our good neighbors in Latin America promote the mining and cultivation of materials that we need and can buy from them. Brazil, for instance, is increasing manganese production. Cuba is expanding her output of chrome ore. We are encouraging the planting in Latin America of rubber trees and cinchona trees, from the bark of which we get quinine. But, again, these projects are likely to be long-range programs and offer only a partial solution.

So we have turned to the much discussed stock-pile program. This is a scheme the War and Navy Departments have been trying to promote for many years, by which reserves of needed materials are purchased and stored here.

Beginnings Are Slow

Unfortunately, we got away to a slow start, because at the outset, the appropriations had been inadequate. Huge stocks of these materials are not lying around the world waiting to be purchased in times like these. Negotiations are difficult. Trade restrictions are manifold. Sometimes production and deliveries, because of shipping difficulties, are slow. We were able to make a couple of quick purchases of substantial supplies of antimony and chrome ore in Indo-China and the Mediterranean, but these are the exceptions rather than the rule. The stock-pile program, calling for the accumulation of about two years' reserves of the strategic materials, is well along from the standpoint of contracting for deliveries, but even if we had title to it a ton of chrome ore in the mountains of Turkey would not help us produce a single pound of steel.

There are two other possible courses of action. One is to find substitutes. We are following this line, too, notably in the case of rubber, where we are arranging for greatly increased production of synthetic rubber. In an emergency we shan't do too badly with rubber. First, with the reduction of speed of automobiles, where a reduction substantially to forty-five miles per hour would reduce our rubber consumption in tires by about a third. Also we have satisfactory substitutes for parachute silk and cocoanut-shell charcoal for gas masks, thus relieving our dependence upon the Far East for these two materials.

The last course is salvage and reclamation. We try to save this one as a last resort. But, just to be on the safe side, we are developing detailed plans for gathering up waste products and re-using them wherever possible.

In closing, let me say unequivocally that unless we in the Industrial Materials Division do our job well, the great effort of this nation to build an impregnable defense not only around the United States but around the entire Western Hemisphere will fail. No other division can carry out its assignment if we fall down on ours.

We are as well satisfied with our effort to date as it is safe to be. We believe that we have done about as well as could have been expected. But it is a big job, a job that no man and no commission could do overnight, for it takes time. There is much yet to be done. Let no one suppose that we have, in the course of a few months, completely solved our raw material problems.