Diplomacy v. Defense

In a fireside shout Franklin Roosevelt this week told Business and Labor that they would have to speed up the job of making the U. S. the "arsenal of democracy". But the Department of Commerce last week let out a few facts which indicated that he had not yet given similar instructions to his own Administration. The Department reported that in October U. S. exports to Japan were up 47% from September to $26,195,000--$3,138,000 under their 1939-40 monthly peak.

The significance of this fact was that two export items were responsible for some 50% of the increase:/- 1) refined and scrap copper (up almost 180% to 29,000 tons); 2) metal-working machinery (up 109% to $1,410,000; $21,166,000 for ten months).

Last month, the copper industry admit ted that there was a copper shortage and made a deal with Defense Commissioner Henderson to let 100,000 tons of cheap Latin-American copper into the U. S. this year (TIME, Dec. 9). Last week from the Defense Advisory Commission came reports of a new study of copper demand based on the fabricating mills running on Knudsen schedule -- three shifts a day, sev en days a week. On the basis of the U. S.'s using Latin America's capacity output (perhaps 600,000 tons a year), it estimated that the U. S. would still have a copper shortage of 300-350,000 tons a year, raised the question of the U. S. beginning to take Canadian copper too. Moreover, right up to Christmas during December's acute copper squeeze, the Japanese (and the Russians) were permitted to continue buy ing spot copper for January delivery, al though, by last week, only one big supplier was still promising copper to domestic consumers for delivery as early as March.

Last week the State Department still maintained a know-nothing attitude, but the Defense Advisory Commission finally asked that copper and zinc exports (mean ing to Japan and Russia) be made subject to licensing. The zinc request was prompted, among other things, by a blast earlier this month from C. Donald Dallas of Revere Copper & Brass. Dallas' com plaint: in October, Japan got 3,775 tons of zinc, in 1940's first ten months, 12,042 tons. Meanwhile, Brass mills working on cartridges, shell cases, detonator caps, rotating bands, fuse caps, other munitions for British and U. S. use, have had to curtail production and delay deliveries.

Although the U. S. has had an export licensing system on certain machine ex ports since last July, the State Department has taken the position that exports of machines not directly needed for de fense should be allowed. But by last week almost every kind of machine-building capacity and labor looked useful for defense. Typically, C. I. O.'s Walter Reuther proposed using excess automaking equipment to make planes, arguing that adapting it to this purpose would take a third of the time needed to build new machines.

The prospective need for machines was indicated by General Motors' economist, S. M. du Brul, who told the American Statistical Association that durable-goods output would have to be pushed up 50% above 1940's summer by mid-1941 to keep the defense program on schedule. The day was rapidly approaching when the U. S. would have to choose between de fense and a foreign policy of keeping on the right side of Japan and Russia.

In 1865 jobs were provided for many an unemployed soldier back from the Civil War digging 30 miles of trenches to drain a 345-acre tract of Chicago swampland, on which rose the Union Stock Yards. Last week the yards -- now biggest in the world, centre of Chicago's only billion-dollar -a-year industry -- observed their 78th anniversary. Over their scales 896 million ani mals have been sold for $21,000,000,000.

/- Another 30% was due to a 51% rise in petroleum products exports.

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