War Production Board Establishes Corporate-Government Fusion Model

President Franklin D. Roosevelt establishes the War Production Board (WPB) via Executive Order 9024 on January 16, 1942, headed by Sears executive Donald M. Nelson. The board empowers corporate executives to oversee production and distribution of raw materials, award contracts, and direct the nation’s economic war mobilization.

The Dollar-a-Year Men

Roosevelt brought in approximately 300 corporate executives as “dollar-a-year men” - ostensibly paid only $1 annually while volunteering their business expertise. The first was William Knudsen, CEO of General Motors, who resigned his post and forfeited his six-figure salary. By summer 1940, some 100 important executives had joined the brigade, including GE CEO Philip Reed, Sears executive Donald Nelson, and Ford production chief Ernest Kanzler.

However, many of these executives continued to draw their large salaries from corporations while serving in government, creating obvious conflicts of interest. Roosevelt brought them in so that businesses didn’t feel the government was simply telling them what to do - instead, industry insiders were making the rules.

Corporate Influence and Criticism

The WPB’s leadership of voluntary industry compliance under federal oversight, rather than outright nationalization, delegated production scheduling to industry-led committees while enforcing government priorities on steel, copper, and aluminum. This model of private sector self-regulation influenced subsequent defense mobilization frameworks, including the Cold War-era Defense Production Act of 1950.

Senator Harry S. Truman’s committee sharply criticized businessmen serving with the WPB for conflicts of interest. The board was further hampered because military procurement bodies could still negotiate separate contracts, and Roosevelt appointed other leaders with responsibility for key areas like petroleum, rubber, and manpower.

Production Results

Despite criticism, the WPB directed $185 billion worth of armaments and supplies production from 1942 to 1945. Military aircraft production jumped from 6,000 in 1940 to 85,000 in 1943 as factories converted from civilian to military production.

Legacy

The WPB established organizational precedents for coordinating public-private partnerships in resource allocation that became the template for the permanent national security state and military-industrial complex. The model of corporate executives shaping government policy while maintaining industry connections became institutionalized in postwar defense planning.