Reconversion—To What?


By DR. VIRGIL JORDAN, President, National Industrial Conference Board, Inc.

Delivered before the Twenty-ninth Annual Meeting of the Associated Industries of Massachusetts, December 1, 1944

Vital Speeches of the Day, Vol. XI, pp. 279-283.

FOR those sons and brothers of ours, yours and mine, who have suffered or fallen in this struggle, and for the many more who will before it ends, we here at home are trustees for something they left behind, which they believe they are defending—the manifold image of accomplishment and opportunity which we call America, and the frail and difficult faith we call freedom in which it was framed by others who suffered and died for it a few generations ago. In our hands they left us this heritage to be administered while they are gone, not by an election, nor certainly by an auction, but by an unlimited mandate of truth, integrity, courage and justice. The exercise of these capacities and qualities we owe them in the ultimate accounting of our stewardship in the days to come. How does the account stand today, as we begin, amid their bloodiest battle, to talk of the task we now call reconversion?

When I spoke to you a year ago, we called it postwar planning, and I told you then that for the image of America to come which our sons and brothers carry in their minds and hearts there was only one fitting frame, but that it had been left in the attic disregarded by our postwar planners, and might someday be sold on the block for a mess of pottage. Well, today when we speak of reconversion we trustees have come a few floors closer to the ground in our inventory, but we still have no very clear idea what we are reconverting to, or what the task involves. A year or so hence, when we make our accounting of the estate which our sons and brothers left behind shall we be speaking of reconversion or of receivership? And have we the candor and courage to say that to them or to ourselves today?

Speaking as an independent auditor, I still do not believe that we need go into the bankruptcy court on behalf of those sons and brothers of ours with the image of American accomplishment and hope, framed in freedom, which they left in our custody, despite the red ink evident in the results of the last election or auction. What was sold then, under the hammer of emergency, was imported, pawned or stolen goods, not the genuine image and faith of America for which we are trustees. Persons were chosen, power was sanctioned for them in the atmosphere of crisis, but no ultimate issues were settled nor any fundamental problems solved for America to come. The question of what kind of America we reconvert to remains to be answered by those who must do it. We must not report to those sons and brothers that we have put their heritage into receivership by what has happened; but we must keep the accounts clear. We must tell the truth about them and face the facts we find in them with integrity, courage and justice if we are to discharge the trust they have imposed upon us.

As I wander in that wilderness of confusion, conflict, folly and fear which is the mind of American industry today, I find many who do not feel that way about the future, but who say instead that the die is cast, that it is futile to expect or propose retreat from the road we tread, till further experience of disaster shall have driven error into the ground. And beside these I find many others who innocently imagine or stubbornly believe that in embracing error or evil in emergency nothing of any moment has happened to the permanent image of America or its fundamental frame of freedom.

Both are mistaken, because both balk at the colossal task that confronts America not merely in the reconversion of her men, materials and machines to the purposes of peacetime prosperity, but more deeply and desperately in the reconversion of her mind and spirit to the principles of economic freedom upon which her political liberty as well as her progress and prosperity in the past and her power in the war-torn world today have rested. These we have abandoned or surrendered during the past decade, like most other people, in blithe ignorance or blind disregard of the lessons of universal experience; and what is worse, there are now many among us, in business and elsewhere, who are willing to deny or repudiate or compromise them as no longer applicable to the wise, but not so brave, new world in which we live. This kind of reconversion is the most immediate, urgent and arduous task, not merely the ultimate one, that confronts us in the accounting of our trusteeship to those sons and brothers of ours when they return, if we are not to be talking of receivership a year or two hence, and it is of this kind of reconversion that I speak today.

It should not be necessary to remind the men of American industry that the problem of reconversion is not a matter of moving things about or making them over—a physical problem which is measurable and therefore manageable by the kind of energy, competence and experience in which America has been unique and inexhaustible, and by which she has saved the world. It is a matter of men's minds and morals, a problem of their ideas and ideals, and of the atmosphere in which they move. The key to the American miracle of productive accomplishment and economic progress was not in our materials, our machines, or our money, nor even inour men, but in the motion of their minds and the environment of ideas and purposes in which they moved. The American phenomenon consisted in a continuous flow of productive forces, human and material, which started in men's spirits and was released and sustained by the political and social atmosphere which surrounded it. The crucial task of reconversion today is to restore or release that flow, not to control or redirect it to any predetermined end.

This will be enormously difficult to do now because, for the first time in our history, the atmosphere and climate which conditioned that continuous creative current in America has been altered during the past decade by a kind of glacial movement of government over the minds and morals of men, distorting and breaking down their ideas and ideals, and gradually freezing them into different patterns imposed by its own momentum and purpose of power. For ten years or more a different force than that which had conditioned the flow of productive power in American life has been acting steadily on men's minds, shaping their spirits, moving their ideas and ideals about into another form than we have known or imagined. That is the force of government more and more unlimited in the authority, power and responsibility we expect it to exercise in our economic life.

So today the task, not merely of physical reconstruction but of spiritual reconversion, the job of bringing men back from this war, not only the men in the army but in business, labor and government, to face the facts of life and work in peacetime with intelligence and integrity in America as well as elsewhere, is immensely greater than it was a quarter century ago.

Since then, and with increasing speed during the past decade, the spirit of these groups and many others in American life has been caught in the powerful undertow of Old World standards, ideas and aspirations of individual and social conduct and accomplishment, created by the back-wash of the last war. Business, labor and government, no less than educators, scientists, economists and artists, in one degree or another have felt the drag of this spiritual undertow pulling them back toward the Old World way of life, with its fatalistic philosophies, its class conflicts and social rigidities, its frantic emphasis on security, its fear of personal responsibility and risk, its distrust of individual liberty and initiative, its faith in the omnipotence, omniscience and beneficence of the State, and its dependence upon government—from all of which our ancestors escaped for a century to build the strongest and most prosperous nation on earth. In many ways this erosion of the ancient current of Old World ideas has reclaimed America, and during the decade past she has become once more a kind of spiritual dependency or colony of Europe.

This spiritual reconquest of America by the Old World is clearly reflected in the changes in our political institutions and economic organization during this decade, and in the deepest sense this "One World" War is its climax. Anyone who understands the direction of the ideas embodied in the postwar plans being debated today in Britain, and in the reconstruction schemes proposed for France and other countries on the Continent, and who realizes the influence these have on our ideas about the future in America, must feel the terrific force of this undertow.

As I have said with tiresome monotony during the past ten years, the skeleton structure of National Socialism has been deliberately built in America during this decade, largely under the supervision of European architects, and the necessities of the war have established it on a firm foundation and practically completed its operating equipment. Most of the American people seem to be unaware that they have moved out of America and are living in this new social structure built on the European plan, mainly because so far the fiction of nominal private ownership of property and a large measure of personal freedom of movement, speech and occupation have been permitted to remain for the present; but after twelve years of exposure, a large part of organized labor, and of the business community, as well as the press and our educational system, have been assimilated into the atmosphere of ways of living and thinking of this Old World address, and are beginning to feel pretty much at home.

Whatever the military or diplomatic outcome of the war in the West, the essential economic and political ideas of National Socialism have conquered Europe even more completely than the Nazi armies did. It is not merely that the Soviet legions have overrun the Balkans and the Baltic countries and already written the peace for them—the peace of the prison and the concentration camp—but that in most of the rest of Europe, in Italy, France and even England, no Red armies were necessary to destroy economic freedom and civil liberty. It has been done long before by the businessmen, the labor unions and the governments of these countries, Our armies abroad are fighting for ideas—for a philosophy of life and a conception of government—which were dead nearly everywhere in the Old World long before the war began. As we read the complacent or approving accounts in our press these days of the postwar plans for nationalization of European industries, which we are told the Nazis have made inevitable, we realize that everyone, including the Europeans, seems to believe that Europe cannot be set free of its serfdom but can only change masters.

What is more important is that all of the ideas for the postwar world which are accepted today in Europe, especially in England and Russia, assume it as an imperative condition for their success that this country be brought within the same system permanently after the war, and every device for shaping American thought and feeling to this end is being used today, as they have been during the past decade. The European and Asiatic statesmen who are planning and building their postwar world on the ideological foundations of National Socialism, while destroying the Nazi military power with our aid, know better or sooner than the Nazis did that that world cannot live for long half under Socialist serfdom and half under economic freedom. This recognition is no less urgent in the long run for Uncle Joe's totalitarian autarchy than it is for a nation under parliamentary government like England, who must live by trade or starve, and who knows that her postwar planned economy, however complete, can not compete in any free markets of the world with the productive power of a free America. There is indeed nothing that Stalin need fear for the future except the force which the American idea of economic freedom and the temptation which its productive accomplishments could exert on the hundreds of millions of people in the immense slave compound over which he rules, and to protect them from the temptation of that example, as well as to weaken its power in every possible way, is the core of his foreign policy.

The character of American political institutions and her economic system after this war have in fact become as much a crucial concern of the rest of the world as those of Germany were at its beginning, or as those of Russia were after the last war, but this time in reverse fashion. In a postwar world of socialist states, the pre-New Deal idea of economic freedom would remain a subversive revolutionary force internationally as well as internally, just as Bolshevism was after the last war. This fact will furnish the key to most of the postwar problems of international relations as well as those of domestic policy for another decade or two. Whether America can be kept within this global structure of national

socialism which has been erected around her political institutions and economic organization during this decade, or whether she is to resume life within the traditional framework of economic freedom and competitive effort where she left off—this is the central issue for the postwar world. It underlies not only the larger problems of international reconstruction, but also all the practical domestic problems of reconversion for us. It sets the atmosphere or climate in which reconversion is now expected to proceed, and it answers the question what we are expected to reconvert to.

So it is no wonder that you can scan the discussion of reconversion today from end to end without anywhere encountering even the ghost of the idea that the task of restoring the economy to its peacetime flow and rhythm should or might be left to the ways and means of civilian initiative or enterprise with no intervention or aid of government. The idea does not exist and no one is moved even to invent it. That government must participate and exercise the ultimate power and responsibility in whatever happens to the economic system is taken for granted as if it were a natural law, like gravitation, or a political dogma like the divine right of kings. What the presence of this new axiom in men's minds means anyone will realize who remembers that after the last war, only twenty-five years ago, the dollar-a-year men who had controlled the economy during the war, with almost no law at all, simply put on their hats and went home when it ended. Everyone assumed that the way to resume was to resume. That decision was made, but you could hardly say how, or by whom. It was so spontaneous and natural that there is practically no formal record, even such as a debate in Congress, to indicate who decided to do it, or how. Today no one in authority would suggest it, seriously, and if anyone did, it would scare everyone in this room to death.

Last time reconversion was a job of getting back to something we knew. We had gone to war and won it without losing the law, principles or ideas by which the national economy worked. It had only to be set going again under them. This time, here as everywhere in the world, government has got hold of the whole productive and distributive system, as well as the financial organization, and has taken over actual or effective ownership, control and responsibility for production as well as consumption and finance, and it will not willingly take its hands off any of them after the war. The common man everywhere has been convinced that he is incompetent to manage his own affairs, at home or abroad, and had better leave them to the uncommon men of the big brainy and benevolent State, or else lose his liberties. As the labor unions won the last war, unlimited government has won this war in the minds and hearts of hundreds of millions of men all over the world, and in America, too. So this time, without a profound revolution in thought and spirit, there can and will be no real reconversion to a peace-time economy after the war formally ceases. The free market, for commodities, labor, money, and even ideas, which is the ultimate and invincible enemy of unlimited government, will not be willingly restored anywhere, not only because bureaucracy is afraid of it, but because both labor and business are, too.

Businessmen and labor organizations, together or separately, will play a more important part in determining the outcome than any other group, even more important than bureaucracy, whose leadership always consists in getting' the largest possible crowd worked up to chase them in some direction, and then trying to keep one step ahead of the crowd. Where government will go depends in this country mainly upon the direction in which business and labor drive it by their demands upon it, what they expect from it, and how well they understand the price which they and the rest of the American people will have to pay for what they get from it.

It is the mind of business that concerns me most in this matter. Through wartime experience, organized labor has already begun to get some understanding of what bargaining with the absolute State means; but many businessmen still imagine that they can get something from government without paying for it, and are willing to gamble a bit with everybody's liberty to get a little security for themselves. Every government today is driven by its momentum down the same road it has been following during the war, and none of them ever turns off, or back, on its own initiative, so long as it is coaxed or encouraged to continue. Today we are making plans for the demobilization and reconversion of everything but government. Every group has got its teeth set in some piece of the wartime structure of Statism which it wants to keep for itself in the postwar world, whatever happens to the rest, and so everybody is likely to get the whole works, whether they want it or not.

To me the most humiliating thing in the current picture of postwar planning, especially in the American business community, is not so much the ignorance or disregard of past and contemporary experience, the incapacity for clear and candid thinking which it shows, but the low moral level of the standards and aspirations it sets for the American community as a whole, in its frantic search for phoney security, its reckless effort to escape risk, sacrifice and responsibility, its blind indifference to the values of personal and national self-discipline, freedom and independence, and its passive acceptance of State initiative and aid. A nation or a group can never in the end be stronger than the kind of ideals and standards of individual and social conduct, aspiration and accomplishment which it sets for itself; and so far all the thinking about the postwar world which business as well as labor and government have done seems devoid of any recognition that any real reconstruction requires the recreation of such standards, a reconversion of spirit and purpose in the American people no less than one of war plant and equipment if they are to find peace and prosperity after this war.

In their monotonous reiteration of imaginary and arbitrary measures of national income, full employment, consumer purchasing power and social security as goals for the future, the common theme of all our postwar plans today is "more groceries, more gadgets and more government" for the masses; the main question is how much more passive satisfactions we can get out of the State, without effort, risk, sacrifice or responsibility, by using the political means. The main standard and dominant ideal of the postwar world, as these plans picture it, is that of "the silver pig-sty," out of which no strong, prosperous or secure people ever came. If amid all the current chatter about full employment, 150 billion dollar minimum national incomes, expanding purchasing power, and higher standards of loafing, we could hear in government or business or labor or education anywhere in this land a few voices raised to summon and stir the American people to the more intense effort of thought, labor and thrift—to the higher standards of work and accomplishment—that will be necessary not only to win the war but to repair its waste and destruction, one could be more hopeful of the future.

It may not matter much to us for whom the sands of time are running out; but let us remember those twelve million sons and brothers on the battlefront of this war, and the millions of others younger still among us, to whom this postwar world belongs. Many of those sons and brothers of ours will bring back, as my own has, out of the infernoof force where they fought and suffered, a new faith in America, a revelation of the meaning and promise of the American idea of freedom, driven home by what they have seen of the Old World way of life and thought, and where it ended. Are we prepared to nourish that revelation out of our own vision and knowledge, and feed that faith out of our own when they return to the task of reconstruction?

I am not sure, as I read the straws in the winds of opinion about the postwar world that blow through public discussion and political debate today. In our postwar planning, we are framing both the questions of the future and the answers, for these sons and brothers abroad, but we are not telling them the truth, which we owe them and which would be the greatest gift our gratitude could give them, because we do not know it ourselves or will not face it. Somewhere along the road that led to this disaster during the decade of delusion, confusion and cowardice just ended we lost or surrendered that unique and almost instinctive faith in freedom which heretofore, in every crisis or difficulty, had framed the questions and the answers for us infallibly. And having lost it we forgot what till that time every American had always known, unconsciously and surely from the beginning, which is that unlimited government, at home no less than elsewhere in the world, is ultimately the only enemy of peace or plenty he has to fear, because it has always been the lowest common multiple and instrument of the limitless greed for power among men and groups. This war should have reminded us of that, but it has not, and as we face the future and frame our questions and answers about reconstruction confused and frustrated, as never before, believing no longer in ourselves, but in the providence, power and wisdom of the unlimited State. For us, as Matthew Arnold said:

"The sea of faith was once, too, at the full, and 'round earth's shores
Lay like the folds of a bright girdle furled
But now we only hear
Its melancholy, long withdrawing roar
While we stand here as on a darkling plain
Swept with confused alarms of struggle and flight
While ignorant armies clash by night."

The greatest difficulty that faces us in reconversion is that business itself no longer has any coherent conception, conviction or philosophy of its function. During the past decade it has suffered a deep wound to its integrity of spirit, a profound sense of inferiority or guilt, from which it has not been able to recover despite its spectacular accomplishment in this war. The great problem of the future for it is to rebuild its self-respect and purpose which were dissipated and demoralized by the humiliations of the Great Depression and the persecutions of the past decade. It drifts today toward the difficult problems of the postwar future without any clear and consistent philosophy of thought or action based upon any candid recognition of the facts about the economic or political consequences of the war, or upon any perspective of past experience, or even any principle other than that of momentary expediency.

The current confusion and conflict of attitudes toward the crucial issues of continuance of wartime government market controls during reconversion is disturbing evidence of the demoralization and intellectual devastation wrought in the business community during the past decade. To any disinterested observer of the ideas and behavior of business in face of these fundamental issues of the future it must be evident that its capacity to think or act about them with candor, intelligence and integrity has been seriously damaged by ten years of exposure or surrender to the political word-changers, the academic cake-eaters and public-opinion poll-catchers of our time. Today, in every fundamental matter that affects the future of American life it mistakes a synthetic statistic like a national income estimate for a moral standard or an economic truth, and it has no ideas of its own till it has consulted Mr. Gallup's totem-poll and computed the lowest common multiple of the passing opinion of a random sample of indifferent people on devious questions they never thought about.

One after another it hopefully follows the ceaseless procession of spouting stooges of Statism who have promised some solution of these problems by easy compromise or expert plan. Its supreme conception of policy has been one of appeasement toward organized labor and organized bureauracy—the "peace in our time," for which we had such contempt in foreign policy—and today it is seeking escape from its political pessimism and economic despair in a sort of apocalyptic belief in the millennium based on the childish dream that America is a patent cornucopia of automatic plenty or a bottomless well of unlimited wealth; that the war won't really cost anybody anything, and we can start where we left off after it is over as though it never happened.

Well, for my part, as an independent auditor in these proceedings, I say we have gone far enough now down the road to spiritual insolvency and political serfdom in the fog of confusion and deception that has shrouded the mind of America during the past decade. As we come to the concrete task of reconversion it seems to me time for men of insight, integrity and courage in American industry to cast up the account of their trusteeship in the past, in both war and peace, to set down definitely and set forth firmly their philosophy and faith for the future, to take their stand on the truth now, and speak it to the American people and to their sons and brothers abroad without fear or shame, before they see the priceless image of American accomplishment and opportunity with its frame of freedom put into final receivership in some ultimate auction.

Let us tell them that neither business, nor labor, or government, can guarantee them economic security and leave them their civil liberty and personal freedom. That is the plain truth. The governments they are fighting have demonstrated in the past decade, and the whole record of human experience proves that it is impossible. There are many good things America can and will give them, but not this. Anyone who tells them otherwise is a fool or a fraud.

Let us tell them that nobody can pledge them full employment as workers or permanent purchasing power as consumers without depriving them, one by one, of every individual freedom they have. Let us tell them frankly that no one can fix a national income figure for a people or set a statistical standard for employment or payrolls or consumption and still leave everything, or anything, about the life, labor or thought of anybody as it was before.

Let us tell them that nobody, business or government, can plan tomorrow's employment for anyone without planning his occupation, spending, saving and consumption for him.

Let us reveal to them the rigorous iron chain of cause and effect which has always bound together and still links compulsory security, compulsory saving, compulsory labor, compulsory consumption, compulsory occupation, location, leisure, speech and thought.

Let us tell them that nothing has happened in America while they were gone that has made the words "national planning" mean anything different in the end from personal compulsion and social serfdom. Let us put to them the plain fact, written in the record of Nazi Germany, Fascist Italy and Soviet Russia, that no government can own or control the productive industries of any people today, without enslaving them more hopelessly than any Pharaoh everdid, and that economic freedom is the fundamental and indispensable basis of all political and civil liberty.

Let us tell them these things truly, even though they may not care anything about them. Like many of our businessmen, who have abandoned the flesh and the devils and the dangers of the world of freedom and bedded down in the bureaucratic lamaseries in Washington, they may believe that civil liberty is less important, or less problematic, in the future than a full belly. Let them choose, but let us not, as economists, businessmen or labor leaders, lie to them by making them believe that we or government can give them both.

Above all, let us not tell them that because business or government did not and could not give them both freedom and full employment, either in the Thirties or at any time before in the past century and a half, business betrayed them or the American idea has failed. They are being told this day by day, as we have been during the past decade, not only by the word-changers in Washington but by businessmen and labor leaders, and it is a falsehood more cruel than any wound of flesh or soul this war will inflict upon them. The self-betrayal that lies beneath any such repudiation of the past on the part of business or labor leaders is a brutal breach of trust to the millions of sons and brothers who are defending us, for it steals the substance of their faith in America and abandons them to the darkness and despair of dependence on the State, which is the spirit of that hopeless purgatory of Europe and Asia where they are.

So, though times change and no man can. swim the same river twice, and we can and should admit that we might have done better, and must hope to do it, we must take America all together as she was and is and will be, an inseparable whole, a pattern of accomplishment and hope priceless and incomparable, and irreplaceable by anybody's plan.

When we speak to our sons and brothers on the battle-front or to our comrades at home of the aspirations and problems of the future against the efforts or failures of our past, let us not abandon or abate the smallest bit of our integrity, loyalty or self-respect or pride as a group or as a people, or repudiate or bargain away for whatever benefit or bribe from the present or the future the least thing, good or bad, in the qualities or the record of the past of our country or our people. To do otherwise for a moment is to leave these millions abroad spiritually homeless, exiles and castaways on alien soil. They may not care, or know now whether they do or not; but let us remember that if we are to truly win this war, and if we are to accomplish any kind of reconversion worth the name, we must not merely bring these boys back to America, but we must bring America back to them.