War Industries Board

War Industries Board: Definition

The War Industries Board (WIB) was a government agency created to ensure the United States could produce everything it needed for the war effort. The President at the time, Woodrow Wilson, issued an executive order to create the War Industries Board on May 28, 1918. The Board was up and running by that July. The Board consisted of twelve members, each from a different area of business.

Fig. 1 - Production of cavalry saddles in a factory in Portland, Oregon

The WIB was one of many boards to oversee specific sections of the nation's economy. Everything needed to run smoothly on both the homefront and the frontline, meaning all industries had to work together.

War Industries Board of WW1

Even before the US entered the war, the government wanted to prepare materially. There were many aspects of the economy and society that the government needed to be aware of if they wanted to be able to control production. It was from this need that many government agencies were born, one of them being the Council of National Defense and its Advisory Commission.

National Defense Act and the Council of National Defense

In May 1916, Congress ratified the National Defense Act. The Act allowed the President broader authority and power during times of war, as seen in this excerpt of the National Defense Act below:

These powers allowed the executive branch to control the production of raw materials, food, and the railroad system. The founding of the Council of National Defense in August 1916 demonstrated the scope of these new powers. The Council's purpose was to make recommendations to the government about how to proceed with producing war materials. After researching which areas the US would need to manage during wartime, the Council established multiple boards. Each worked in different areas of the economy, including the General Munitions Board, which would later become the War Industry Board.

War Industries Board: Purpose

Soldiers needed uniforms, shoes, guns, ammunition, gas masks, tanks, and ships. It was the job of the War Industries Board to ensure that the United States was able to produce enough of these products. Industrial production increased by 20% during the war, and most of these items were shipped to the front line.

The government essentially took control of the economy to ensure that they were able to be able to produce everything they needed to. The WIB controlled the pipeline of raw materials to ensure that the industries that were essential to the war effort were prioritized before the sectors that were not necessarily essential to the war.

Fig. 2 - A division of the War Industries Board.

The WIB also worked with companies to encourage their factories to stop making their usual goods and to shift over to making war supplies. Factories were also pushed to find ways to increase production while minimizing their waste. One way factories did this was through the mass production of standardized products.

The companies that the government worked with were private businesses, so they could raise the prices of items needed for the military and the general war effort. Therefore, another essential consideration for the WIB was ensuring costs stayed level. This would keep businesses from price gouging.

Heads of the War Industries Board

The War Industries Board had three leaders over its lifetime: Frank Scott, Daniel Willard, and Bernard Baruch. The first two leaders left quickly as they found that the WIB could not do much because of the antitrust laws already in place. These issues affected the abilities of the first two leaders of the WIB.

In 1918, President Wilson expanded the abilities of the WIB, which allowed it to be much more effective. This allowed the tenure of Bernard Baruch, the final leader of the WIB, to be much more successful than his predecessors.

Bernard Baruch

President Woodrow Wilson put the Wall Street banker Bernard Baruch at the head of the War Industries Board in March 1918. Since President Wilson expanded the powers of the WIB, Baruch could work directly with industry leaders and prioritize the allocation of raw materials and then the manufacturing of goods.

Fig. 3 - Photograph of Bernard Baruch, who was nicknamed "Dr Facts" by President Wilson

War Industries Board: Significance

The creation of the War Industries Board was one of the first times in United States history when the government had the power to intervene with the country's economy. The WIB, along with the other agencies of the Fuel Administration, Food Administration, Railroad Administration, and the National War Labor Board, helped organize each corner of the American economy. Together, they ensured that the homefront economy was doing all it could to supply the war effort with everything it needed.