Free Enterprise


By ALBERT W. HAWKES, President, Chamber of Commerce of the United States

At Noon Meeting of the Chamber of Commerce of the State of New York, New York City, on January 8, 1942

Vital Speeches of the Day, Vol. VII, pp. 207-210

AS I address this distinguished assemblage I have a very comfortable feeling, because I see before me the representatives of an institution that stands for the best business practices of the past, of the present, and those which fore-shadow the future of our country. The Chamber of Commerce of the State of New York, dating from the time of King George III, has spanned nearly two hundred years of our history; and in its experience, its devotion to sound principle, and in the courage with which it has met issues, is truly an American institution.

In the President's special message to Congress and the nation on Tuesday of this week he outlined the requirements for service and contribution of the American people necessary to insure a complete victory for this nation. Business and industry throughout the nation accepts the call to full patriotic duty and will respond with a determination not to fail the American people in any respect within their power in this grave hour of the nation's history.

There is no task within the realm of human power which cannot be accomplished by our people through unity of purpose and operation. I feel certain that the President and all those in authority will, under the conditions facing this nation, work to eliminate class hatred and bitterness—promote unity of action and invoke equity and mutuality for all. I feel certain the President and those surrounding him will see the necessity of using as leaders the best men we have in each and every group of our American life, regardless of political faith or affiliation. Those in authority will recognize the absolute necessity of building an efficient organization and the delegation of ample power and authority to promote efficiency, speed and the accomplishment of the purpose outlined by the President.

All sound-thinking Americans recognize there can be but one head in any successful organization and that the President is the Commander-in-Chief of the armed forces and the nation in this great crisis. The American people, however, recognize and hope that he, as head of our nation, will carefully and successfully delegate the necessary power and authority to build an effective organization to accomplish his objectives,—an organization that will function to the limit of the ability that lies within the group of able men composing such an organization.

Right at the moment we should avoid heated discussion of any controversial issue, unless it is destroying the vital fundamentals of our way of life. The timing of things today is more important than it has ever been at any time during the lives of any of us. Today we have a job to do, the magnitude of which has never been approached or even contemplated by any nation in the history of the world. America will do that job because we are determined to avoid petty controversies and dissensions, subdue class and group hatred and bitterness and promote unity. Victory cannot be achieved by a divided nation. We must concentrate as one people with a single purpose—namely, the production of the things necessary to win the war, the production of the food necessary to sustain the nation, and the training of the manpower to use these materials of war in an effective and successful way.

No matter what any American thought with reference to the war being carried on by other nations throughout the world up to the afternoon of December 7, 1941—we all realize now that we are engaged in the greatest war of all times. A war brought about by the attack made by dictatorship nations upon the principles involved in our American way of life. A war having as its objective the extermination of individual freedom.

The infamous attack on Pearl Harbor has changed the place of emphasis, and it has now become the first duty of American business, capital and labor—the first duty of the American Government, national and local—and the first duty of the entire American family, to so work and work together as to bring the war to a speedy and successful conclusion. This is our first consideration—this is our first concern—this is our first obligation before God and our fellowmen! The illustrious Robert E. Lee once said that "Duty is the sublimest word in the English language,"—and with that sentiment I am in full accord.

All that we hold dear in our American way of life is in jeopardy. The inheritance bequeathed to us by our heroic fathers is in danger of being destroyed. Young Americans are being killed this very moment, and thousands of our citizens are suffering physical pain and mental anguish because of the attacks of the aggressor. No man's life and property are secure. The only reason that the Japs and the Nazis are not tramping the streets of this very city today, ravaging the homes, plundering the banks, violating the churches, and debauching the people—is that our armed forces have been able thus far to keep them at a distance. The American people must be aroused to the peril of the hour and stimulated to pay the price of their own protection. Our very survival as a nation is involved. The necessity for an all-out dedication to the principles and institutions of human freedom confronts us. And that which confronts us all, confronts us each.

Free Enterprise is the Foundation of Individual Freedom

The subject I have chosen to speak on is "Free Enterprise is the Foundation of Individual Freedom"—and it is the foundation of individual freedom in times of war as well as in times of peace.

I propose to raise and answer two important questions and to state two of my fundamental convictions. The questions are these:

1. What do we mean by free enterprise?

2. How is free enterprise fundamental to individual free-

And my two fundamental convictions are:

1. Free enterprise is essential to the successful prosecution of the war; and

2. Free enterprise is necessary to establish world peace and future progress.

What Do We Mean By Free Enterprise?

Free enterprise furnishes the sustaining force and power that has built the very foundation upon which our American way of life and individual liberties rest. Free enterprise is the opportunity through which our individual liberties find expression in results accomplished. Free enterprise and its results in the form of reward for effort and accomplishment is the mainspring that has stimulated the free people of this nation and urged them onward to the accomplishment of the highest standard of living ever attained in any country in the world.

How is Free Enterprise Fundamental to Individual Freedom?

Our free enterprise system is the economic expression of the fundamental principle of human liberty. The other freedoms which we enjoy—namely, freedom of speech, freedom of the press, freedom of assembly, and freedom of religion-are vitally and inseparably connected with this fundamentalprinciple of free business enterprise. And it is to the successful operation of this economic freedom that the American people owe the high standard of living they enjoy today.

Free Enterprise is Essential to the Successful Prosecution of the War

Free enterprise and free labor are our greatest national assets—vastly more important than our natural resources and our material wealth. This powerful combination of intelligent, voluntary co-operation can out-work and out-produce the controlled industries and regimented workers of all the Axis countries. This great national asset must be preserved. It must be preserved to the fullest possible degree throughout the war to obtain the best military results; and it must be preserved after the war to rebuild the tragic aftermath of the conflict. Like the force of gravitation and all the other basic factors of life, neither war nor peace alter the fundamental principle of individual freedom with responsibility. There are some things that are changeless, unaffected by the passing of time, or circumstances, and this is one of those eternal verities.

The war can be won only with the contribution which American business can make. During the World War, it was estimated that about five men were required at home to provide the needs of one fighter in the front line trenches. Radical changes have taken place in the past two decades, and it is now estimated that seventeen or eighteen men must be provided to back up every fighter on the firing line. Many businessmen are necessarily included among those who must remain at home. It may be readily seen, therefore, how tremendously important is the loyalty and devotion of those ho play their part in the less spectacular field of the army in plain clothes, and how impossible it is to win victory on the field of battle without the spirit of comradeship and cooperation in the production of essential war materials on the farms, in the factories and places of business at home.

American business is indispensable to victory. Individual initiative and enterprise are the very genius of American business by which the nation has grown to greatness. Under our system free labor and free enterprise have encouraged the development of initiative, resourcefulness, adaptability and ingenuity among the millions of men who provide the brain and the brawn, the skill and the muscle to develop our natural and human resources. Therefore, we can face a hostile foe with the confidence of ultimate victory. In the last analysis this is a war of free men against those who would enslave their fellows.

If the free enterprise system were destroyed, then the mainspring that has propelled individuals to accomplishmentis broken and the individual will slump back into a non-competitive frame of mind and attitude which must result in a far lower standard of living than we have known for decades. There is no evidence anywhere in the world that shows that individual liberty can survive as we know it, when free enterprise—with its right of free choice of occupation, the right to work when and where one will—has been destroyed.

Since December 7, 1941 free enterprise recognizes that its prime duty is to perform in production of things needed to carry on this war to a successful and victorious issue. Free enterprise, in cooperation with those in authority in our government, will prove that it is more efficient and effective than any system of production wherein the people of a nation are fully controlled and directed by a dictator.

Nobody should misunderstand the position of business. The Chamber of Commerce of the United States believes, and I personally believe, in the right of labor to organize, to strike and to do all things lawful in the protection of its interests. Some months ago when an anti-strike bill was introduced inCongress, the Chamber of Commerce of the United States opposed it on the ground that labor should not be deprived of the right to strike under any ordinary conditions. We believe that labor and business alike should be free from too much government restraint. Our record in all this is clear and fair.

We are now informed that government, labor and capital have reached an agreement under which there will be no strikes for any cause. This means no interference with maximum production for national defense. It is my earnest hope that every party involved in this agreement will live up to the spirit of it. When I say the spirit of it I mean maximum production at full speed, with no slow-downs on the part of labor, even though such slow-downs might not come under the category of strikes—and no sharp practice on the part of capital and management to deprive any citizen of his right to work because he belongs or does not belong to any organization.

We are all Americans and we must all work together toward a common objective, without the loss of a moment. We cannot tolerate any interference from any source with the full production required to win complete victory.

Should this spirit of representative democracy—namely, voluntary cooperation—prove ineffective in this hour of national peril, then Congress must promptly pass the Smith Bill, or some similar law, which protects the interests of the people. I would not deny either labor or capital one iota of their rights—but let us expect of labor, capital, and all other groups in our American life, that patriotic devotion to the cause which will accomplish a certain and speedy victory.

The simplification of defense agencies is essential. We are at war today with countries whose economy has long since been geared to war. In order to wage this fight effectively, there must be coordination of our present defense agencies, and a complete self-organization of industry to promote the maximum output. The defense organization in Washington should be so set up that it functions through one head, appointed by the President, with full powers to act. The experience of the last war proved the worth and workability of such a plan.

The relationship between the nation's finances and its fighting ability is vital. Wasted dollars are soldiers, sailors and air men lost. Wasted dollars lead to the impoverishment of the people and the insecurity of their government. Many a so-called non-military federal project and expenditure must be discontinued. Ordinary expenses of government must be cut to the bone, and the necessary war expenditures must be met patriotically and without waste. The recent recommendation of the Byrd Committee of Congress for the reduction of 1 billion 700 million dollars in government non-defense expenditures will receive wide-spread popular approval. The committee's pronouncement is sane and statesmanlike, when it says: "Before the war the proposals for cutting out non-defense and non-essential activities were important. Now they are vital. There is no room for nonessentials in a government stripped for action."

Economy in government expenditures is absolutely necessary to encourage the average citizen in a spirit of self-sacrifice to assume the burdens of increased taxation required to pay as much of the cost of the war as possible while it is being waged. A sincere economy in government is equally necessary to stimulate the people to invest their savings in government bonds and stamps. If American citizens are to escape the bonds of Nazi serfdom, they must be willing to put their savings in the bonds of their own government. This is both a patriotic duty and a wise investment.

We know that victory is not won only by the soldiers on the battlefield while the rest of us go about our ordinary

affairs. Modern war is all-embracing. It is fought on financial, industrial and spiritual, as well as military and naval fronts—even in the fields and at the firesides. We are all combatants in this sense. Each of us has something to do, on the farm and in the factory, in providing the guns and ships and planes, in supplying financial and material resources, in alleviating distress and protecting as best we can the weak and infirm against the shock of conflict. The discipline our foes attain by compulsion, we must attain by voluntary cooperation. The solidarity they achieve by cracking the whip over their subjects, we must achieve by promoting understanding and the realization of our common responsibilities and interests. The efficiency they acquired by destroying democratic institutions, we must acquire through preserving them.

In all walks of life the positive, rather than the negative, attitude is essential to success. The slogan of American business is "Do it now." Wars are won by attack, not by wishful thinking, and pious hopes. The aggressive reaction of the Russian people has disproven the myth of Nazi invincibility. No matter how deeply entrenched or what primary advantages the aggressor may seem to have, wickedness can be routed if men have the will to win, the resources to use, and the spirit to resist and overcome. The forces of evil against which we contend must be outclassed by the forces of right as we conceive them, and the frenzy of the dominated peoples misguided by military leaders must be outmatched by the fidelity of free men to the principles of individual liberty. We must out-zeal, out-sacrifice and out-produce those who war against us. We may hope for an early conclusion, but we must prepare for a long conflict. We must not be guilty of the folly of underestimating either the strength or the spirit of our foes.

Let us remember the right to criticize those in authority in a representative democracy exists and should be encouraged as long as that criticism comes from a patriotic mind, is sincere and constructive. Petty fault-finding criticism should be avoided and discontinued, especially in war times. Genuine criticism is the essence of representative democracy in both peace and war times. To the extent it ceases or is subdued or prohibited by those who temporarily are in power—just to that extent representative democracy is failing to function. Criticism which, if published, would give aid and comfort to the enemy, should be made in private or in such a way that its benefit for the people will not be lost and the aid to the enemy will be avoided. Intelligent citizens, cooperating with intelligent people in authority, can avoid the publicity I refer to. The timing, manner and place of criticism are vital factors.

Free Enterprise Is Necessary to Establish World Peace and Future Progress

To sum up, free enterprise faces the most difficult task of its entire career:

1. It must produce the things required for a successful war to final victory. It must produce better and faster than slave-enterprise can produce under dictatorship.

2. It must do these things at a fair living profit, while bearing the burden of greatly increased taxes. Each element—capital, management and labor—must avoid taking advantage of the crisis in order to make personal gain and thus impede production.

3. Free enterprise must be alert and vigilant to protect individual freedom—choice of occupation and the right to work. Otherwise the objective of the war will be lost and free enterprise will not be preserved for the future restoration and upbuilding of our country.

4. Free enterprise must accept its responsibility to planfor the future—the adjustment period when peace returns and millions of men are released from the army, navy, air force and war industries. It must be prepared then to do a job equal in importance and even more difficult than its war job. It will not fail in winning the victory of war production and, therefore, it must not fail in doing its full part in the post-war adjustment job.


The power to prosecute this war successfully to victory, and at the same time preserve the objective for which we are fighting, is not an impossibility. To win victory without the preservation of our American way of life would be a hollow mockery. I have faith that the American people have awakened to a realization of the fact that the one victory without the other victory would be toiling, sacrificingand suffering in vain, and that the lesson taught them by their forefathers will sustain them in their efforts to accomplish these two great victories successively.

The New York State Chamber of Commerce has been the free enterprise watch-dog for generations and I am certain you members of today will not relinquish or abandon your watchfulness and protection of this vital free enterprise system. It needs you more today than at any time since its birth. It is ill and under vicious attack from many sides—YET right now those in authority and the American people as a whole are calling upon it to help save the nation. It is the only thing that can and will make it possible for our boys in uniform to successfully do that job to a full and complete victory. Let us not forget free enterprise is the foundation built through individual initiative, operating under individual freedom.