The Lend-lease scheme of 1941 changed history. It ensured that the Allied victory in WW2 could be achieved without immediate consideration of the economic price for that victory.
In Parts 1-7 (of this 10 part series), I discussed the political, military and the economic path that culminated in Britain’s ‘Darkest Hour’.
How could Britain escape the impending economic catastrophe and the military defeat that would follow?
To delay economic catastrophe, the British and the American governments sought alternate measures throughout 1940. The ‘Cash and Carry’ policy (see Part 4) could not be sustained. After months of negotiations, the ‘Destroyers for Bases Agreement’ was signed in September of that year. Under the agreement, the US government exchanged fifty WW1-era destroyers in return for securing 99 year rent-free leases on British bases in Newfoundland, the West Indies, and in British Guiana (modern Guyana). The Royal Navy was desperate for warships to escort its convoys across the Atlantic sea-lifeline, and so the deal was accepted. Unfortunately, the ships were little more than scrap-metal, as they had been poorly preserved in their inactive state since the end of WW1. However, the ships were better than nothing. And while the rent-free leases seem overly generous, the British negotiators inserted a few advantageous clauses of their own into the agreement. The British military effectively handed over the bases to a friendly power – who was required to (a) maintain them (thereby relieving British forces desperately needed elsewhere), and (b) massively expand those bases (which British forces could also use). But more assistance was needed.
To provide more assistance, President Roosevelt knew he had to garner political support for the Allied cause amongst the American people. Indeed, the Presidential Election of November 1940 was a contest between the Isolationists and the pro-Allied camps in America. Roosevelt and other likeminded US politicians had inserted successfully the ‘Cash and Carry’ clause into the Neutrality Act of 1939 in the face of ardent Isolationist sentiment. But this clause was not enough. Roosevelt knew that the American people had to share his fears of the consequences of Axis victory in both Europe and Asia. He wanted Americans to understand that WW2 was a world-wide struggle for democracy. In a speech delivered by radio broadcast on 29th December 1940, Roosevelt called upon America to become the ‘Arsenal of Democracy’ and to produce the munitions required to defeat the Axis powers. He followed this speech with his ‘Four Freedoms’ speech on 6th January 1941 in his State of the Union address – in which he asserted four fundamental freedoms that people ‘everywhere in the world’ ought to enjoy (Freedom of Speech, Freedom of Worship, Freedom from Want and Freedom from Fear). The speech was a direct assault on his Isolationist opponents.
In Part 9 (of this 10 Part series) I will discuss the establishment of the Lend-lease Act, and its economic value to the Allied war effort.