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.Mobilization planners decentralized organizational impulses reflectedtheir fears of authoritarianism as much as their acknowledgment thatdecentralization would get the job done with the most efficiency andthe least cost.Policymakers like Leon Keyserling and Charles Wilsoninsisted that private-sector advisory committees be consulted at ev-ery step of the rearmament and stabilization process.Many of theseadvisory committees were already being used by the Departmentsof Commerce, Labor, and Agriculture; in turn, the Office of DefenseMobilization created its own committees, largely comprising private-sector specialists but also making use of at-large public representatives.The Wage Stabilization Board took this cooperative effort to its logicalconclusion by wedding the interests of government, business, and laborthrough its nine-man tripartite setup.Thus the Korean mobilization,like the ones that preceded it, relied upon New Era style cooperativemanagement, decentralized operations, and dollar-a-year businessand production experts.71Finally, the appointment of the suave darling of business Eric John-ston to the ESA, coupled with the administration s almost simultaneousimposition of wage and price controls, primed the nation for a long-haul mobilization program while sending an obvious signal to businessthat its interests were indeed being tended by one of their own.In fact,after Valentine s departure, the only non-businessman among the topechelon of mobilization planners was Michael DiSalle.71.For other references to these developments see Kim McQuaid, Uneasy Partners:Big Business in American Politics, 1945 1990, 59 72; Kim McQuaid, Big Business andPresidential Power, 161 67; Hogan, Marshall Plan, 380 84.IIILabor s Cold ShoulderThe Price and Wage Freeze and aCrisis-Filled Spring, February May 1951February through May 1951 was one of the most active anddivisive periods of the Korean mobilization.It was a time of constantadjustment, as the Truman administration tried to structure and pacerearmament in a manner compatible with the nation s long-standingtraditions and values and that would not convert the country into a regi-mented garrison state.At the same time, the administration was forcedto deal with a series of military and political crises that threatenedthe entire mobilization effort.These months also brought considerablegood news, however.The inflation rate eased, and materials that hadbeen in short supply began to reappear.The new stabilization programbegan to have the desired effect: panic-inspired buying ceased, pricesfell, and production rose.In the early summer of 1951, the United Stateswas poised to enter one of the most productive and prosperous periodsin its history.The story in Korea was not as rosy as the domestic economic scene,however.By early spring, the heretofore topsy-turvy military engage-ment in Korea had stalemated.General Douglas MacArthur s attemptsto widen the war and question its efficacy undermined the Trumanadministration and precipitated a full-blown crisis that called intoquestion the primacy of the civilian government over the militaryestablishment.MacArthur s insubordination resulted in his dismissal,which played right into the hands of Truman s opponents and theconservative bloc in Congress.By now, the Korean War had become Truman s War, a war of stalemate, attrition, and bitter partisan polit-ical rhetoric.The uproar over MacArthur s dismissal hampered the ad-ministration s efforts to formulate coherent, long-term defense strategy82Labor s Cold Shoulder / 83and bolstered the efforts of those who opposed Truman s economic andforeign policies.Relations between the chief executive and Congressgrew increasingly strained as Congress tried to limit the president sauthority by diluting his emergency and mobilization powers andstalling on much-needed tax increases.At the same time, and in spite of the overall progress of the rearma-ment program, the American people and the Congress began to fretopenly over the long-term consequences of mobilization.At issue wasthe public s dread of a garrison state and a centrally regimented econ-omy dominated by government-sponsored monopoly and oligopoly.Especially troublesome were the effects of materials shortages anddefense procurement practices on small- and medium-sized manufac-turers.As in World War II, large, capital-intensive firms in the monopolyand oligopoly sectors received the lion s share of prime defense con-tracts.Complicating this disturbing trend was the inefficient DefenseOrder (DO) system, which was in place to distribute raw materials andcommodities, especially those most urgently needed for defense manu-facturing.Small- and medium-sized producers, particularly those whowere not vertically integrated or well diversified, were at a compara-tive disadvantage.Unlike their larger counterparts, they were unableto convert easily to defense production.Thus, smaller manufacturerscould not efficiently compete with larger ones for the shrinking aggre-gate resource base, nor could they easily attract defense work.The dislocations caused by rearmament even affected corporationsthat were usually considered to be large.During the early 1950s, theautomotive industry, for example, comprised six independent firmsin addition to the Big Three (Ford, Chrysler, and General Motors).In this instance, the so-called independent car makers, which collec-tively produced about 15 percent of the nation s total output, were at acomparative disadvantage to the industry leaders.Although statisticsclassified the independents as large corporations, compared with theBig Three, they were dwarfs running among giants.Because of thestructure of the auto industry, then, they suffered difficulties compa-rable to those experienced by much smaller corporations.The Kaiser-Frazer Corporation of Willow Run, Michigan, for instance, was caughtin a price squeeze because of the ceiling on automobile prices.Unlikeits larger counterparts, Kaiser-Frazer produced only two lines of cars
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