Lend-Lease

President Franklin D. Roosevelt signs the Lend-Lease bill to give aid to Britain and China (1941)

Lend-Lease (Public Law 77-11)^[1] was the name of the program under which the United States of America supplied the United Kingdom, the Soviet Union, China, France and other Allied nations with vast amounts of war material between 1941 and 1945. It began in March 1941, over 18 months after the outbreak of the European war in September 1939, but before the U.S. entrance into the war in December 1941. It was called An Act Further to Promote the Defense of the United States. This act also ended the pretense of the neutrality of the United States. Hitler recognized this and consequently had submarines attack US ships such as the SS Robin Moor, an unarmed merchant steamship destroyed by a German U-boat on 21 May 1941 outside of the war zone.

A total of $50.1 billion (equivalent to $759 billion at 2008 prices) worth of supplies were shipped: $31.4 billion to Britain, $11.3 billion to the Soviet Union, $3.2 billion to France and $1.6 billion to China. Reverse Lend Lease comprised services (like rent on air bases) that went to the U.S. totaled $7.8 billion, of which $6.8 billion came from the British and the Commonwealth. The terms of the agreement provided that the material was to be used until time for their return or destruction. (Supplies after the termination date were sold to Britain at a discount, for £1.075 billion, using long-term loans from the U.S.) Canada operated a similar program that sent $4.7 billion in supplies to Britain and the Soviet Union.^[2]

This program was a decisive step away from American non-interventionism since the end of World War I and towards international involvement. The Americans demanded that this rent be settled, and it took until 2006 for the UK government to settle its debt to the USA.^[3]

Political background

Lend-Lease came into existence with the Lend-Lease Act of 11 March 1941, which permitted the President of the United States to "sell, transfer title to, exchange, lease, lend, or otherwise dispose of, to any such government [whose defense the President deems vital to the defense of the United States] any defense article". In April, this policy was extended to China as well.^[4] Roosevelt approved US $1 billion in Lend-Lease aid to Britain at the end of October, 1941.

There was an entirely different program in 1940, the Destroyers for Bases Agreement whereby 50 USN destroyers were transferred to the Royal Navy and the Royal Canadian Navy in exchange for basing rights in the Caribbean and Newfoundland. The UK had been paying for its matériel in gold under "Cash and carry", as required by the Neutrality Acts of the 1930s.

Everett Dirksen, at the time a Republican U.S. Representative, was able to secure the passage of an amendment to the Lend-Lease bill by introducing the resolution while 65 of the House's Democrats were at a luncheon. Section (3)(c) of the Act thus provided that "after the passage of a concurrent resolution by the two Houses before June 30, 1943, which declares that the powers conferred by or pursuant to subsection (a) are no longer necessary to promote the defense of the United States, neither the President nor the head of any department or agency shall exercise any of the powers conferred by or pursuant to subsection (a)" ^[5]

Administration

Franklin D. Roosevelt set up the Office of Lend-Lease Administration in 1941, appointing steel executive Edward R. Stettinius as head. In September 1943 he was promoted to Undersecretary of State, and FDIC director Leo Crowley became head of the Foreign Economic Administration which absorbed responsibility for Lend-Lease.

Lend-Lease aid to Russia was nominally managed by Stettinius. Roosevelt's Soviet Protocol Committee, dominated by Harry Hopkins and General John York, who were totally sympathetic to the provision of "unconditional aid." Until 1943, few Americans objected to Russian aid.^[6]

Significance

Relationship in Gross domestic product between Allied and Axis powers, 1938–1945. See Military production during World War II.

Lend-Lease was a critical factor in the eventual success of the Allies in World War II, particularly in the early years when the United States was not directly involved and the entire burden of the fighting fell on other nations, notably those of the Commonwealth and, after June 1941, the Soviet Union. Although the attack on Pearl Harbor and the Axis Declarations of War brought the US into the war in December 1941, the task of recruiting, training, and equipping U.S. forces and transporting them to war zones could not be completed immediately. Through 1942, and to a lesser extent 1943, the other Allies continued to be responsible for most of the fighting and the supply of military equipment under Lend-Lease was a significant part of their success. In 1943-44, about a quarter of all British munitions came through Lend-Lease. Aircraft (in particular transport aircraft) comprised about a quarter of the shipments to Britain, followed by food, land vehicles and ships.

Even after the United States forces in Europe and the Pacific began to reach full-strength in 1943–1944, Lend-Lease continued. Most remaining allies were largely self-sufficient in front line equipment (such as tanks and fighter aircraft) by this stage, but Lend-Lease provided a useful supplement in this category even so, and Lend-Lease logistical supplies (including motor vehicles and railroad equipment) were of enormous assistance.

Much of the aid can be better understood when considering the economic distortions caused by the war. Most belligerent powers cut back severely on production of nonessentials, concentrating on producing weapons. This inevitably produced shortages of related products needed by the military or as part of the military-industrial complex.

The USSR was highly dependent on rail transportation, but the war practically shut down rail equipment production: only about 92 locomotives were produced. 2,000 locomotives and 11,000 railcars were supplied under Lend-Lease. Likewise, the Soviet air force received 18,700 aircraft, which amounted to about 14% of Soviet aircraft production (19% for military aircraft).^[7]

Although most Red Army tank units were equipped with Soviet-built tanks, their logistical support was provided by hundreds of thousands of U.S.-made trucks. Indeed by 1945 nearly two-thirds of the truck strength of the Red Army was U.S.-built. Trucks such as the Dodge 3/4 ton and Studebaker 2½ ton, were easily the best trucks available in their class on either side on the Eastern Front. U.S. supplies of telephone cable, aluminum, canned rations, and clothing were also critical.

Lend Lease was a critical factor that brought the U.S. into the war, especially on the European front. Hitler cited the Lend-Lease program when he declared war on the U.S. on 11 December 1941.

Repayment

Large quantities of goods were in Britain or in transit when the United States terminated Lend-Lease when the war ended on 2 September 1945. Britain wished to retain some of this equipment in the immediate post war period. In 1946, the post-war Anglo-American loan further indebted the Britain to the U.S. Lend-lease items retained were sold to Britain at 10% of nominal value, giving an initial loan value of £1.075 billion for the Lend Lease portion of the post-war loans. Payment was to be stretched out over 50 annual payments, starting in 1951 and with five years of deferred payments, at 2% interest.^[8] The final payment of $83.3 million (£42.5 million), due on 31 December 2006 (repayment having been deferred in the allowed five years), was made on 29 December 2006 (the last working day of the year). After this final payment Britain's Economic Secretary, Ed Balls, formally thanked the U.S. for its wartime support.

Quotations

Franklin D. Roosevelt, eager to ensure public consent for this controversial plan, explained to the public and the press that his plan was comparable to one neighbor's lending another a garden hose to put out a fire in his home. "What do I do in such a crisis?" the president asked at a press conference. "I don't say... 'Neighbor, my garden hose cost me $15; you have to pay me $15 for it' …I don't want $15 — I want my garden hose back after the fire is over." ^[9]

Joseph Stalin, during the Tehran Conference in 1943, acknowledged publicly the importance of American efforts during a dinner at the conference: "Without American production the United Nations could never have won the war."^[10]

US deliveries to USSR

Warsaw 1945: Willys jeep used by Polish First Army as part of US Lend-Lease program.

The Lend-Lease Memorial in Fairbanks, Alaska commemorates the shipment of U.S. aircraft to the Soviet Union along the Northwest Staging Route.

American deliveries to the Soviet Union can be divided into the following phases:

• "pre Lend-lease" 22 June 1941 to 30 September 1941 (paid for in gold)
• first protocol period from 1 October 1941 to 30 June 1942 (signed 1 October 1941)
• second protocol period from 1 July 1942 to 30 June 1943 (signed 6 October 1942)
• third protocol period from 1 July 1943 to 30 June 1944 (signed 19 October 1943)
• fourth protocol period from 1 July 1944, (signed 17 April 1945), formally ended 12 May 1945 but deliveries continued for the duration of the war with Japan (which the Soviet Union entered on the 8 August 1945) under the "Milepost" agreement until 2 September 1945 when Japan capitulated. On 20 September 1945 all Lend-Lease to the Soviet Union was terminated.

Delivery was via the Arctic Convoys, the Persian Corridor, and the Pacific Route. The Pacific Route was used for about half of Lend-Lease aid: by convoy from the US west coast to the Soviet Far East, via Vladivostok and the Trans-Siberian railway.^[11] After America’s entry in the war, only Soviet (or Soviet-flagged) ships were used, and there was some interference by Japan with them. The Alaska-Siberia Air Route, known as Alsib,^[12] was used for delivery of nearly 8,000 aircraft, air cargo and passengers from 7 October 1942.

Reverse Lend-lease

Reverse Lend-lease or Reciprocal Aid was the supply of equipment and services to the United States, e.g. the British Austin K2 military ambulance. From Canada the Fairmile launches for anti-submarine use and Mosquito photo-reconnaissance aircraft. New Zealand supplied food to United States forces in the South Pacific, and constructed airports in Nadi, Fiji.

In 1945–46 the value of Reciprocal Aid from New Zealand exceeded that of Lend-lease, though in 1942–43 the value of Lend-lease to New Zealand was much more that of Reciprocal aid. The UK also supplied extensive material assistance to US forces stationed in Europe, for example the USAAF was supplied with hundreds of Spitfire Mk.V and Mk.VIII fighter aircraft.

"The cooperation that was built up with Canada during the war was an amalgam compounded of diverse elements of which the air and land routes to Alaska, the Canol project, and the CRYSTAL and CRIMSON activities were the most costly in point of effort and funds expended.

[...] The total of defense materials and services that Canada received through lend-lease channels amounted in value to approximately $419,500,000.

[...] Some idea of the scope of economic collaboration can be had from the fact that from the beginning of 1942 through 1945 Canada, on her part, furnished the United States with $1,000,000,000 to $1,250,000,000 in defense materials and services.

[...] Although most of the actual construction of joint defense facilities, except the Alaska Highway and the Canol project, had been carried out by Canada, most of the original cost was borne by the United States. The agreement was that all temporary construction for the use of American forces and all permanent construction required by the United States forces beyond Canadian requirements would be paid for by the United States, and that the cost of all other construction of permanent value would be met by Canada. Although it was not entirely reasonable that Canada should pay for any construction that the Canadian Government considered unnecessary or that did not conform to Canadian requirements, nevertheless considerations of self-respect and national sovereignty led the Canadian Government to suggest a new financial agreement.

[...] The total amount that Canada agreed to pay under the new arrangement came to about $76,800,000, which was some $13,870,000 less than the United States had spent on the facilities."^[13]

UK lend-lease with Canada

UK lend-lease arrangements with its colonies is one of the lesser known parts of World War II history, as US Lend Lease dominates most available information due to its vast economic and physical scope. However, the UK's lend-lease arrangements with its colonies is one of the many infrastructural reasons for the Allied Forces victory.

The Gander Air Base now known as Gander International Airport in Newfoundland was leased to Canada for 99 years because of its urgent need for the movement of fighter and bomber aircraft to the UK. One of the reasons why the UK was able to win the Battle of Britain was because of this Canada-Newfoundland lend-lease arrangement, but not all Battle of Britain historians have noted this important connection.

Gander Air Base (built 1936) was mentioned in the 1941 Allied propaganda film Churchill's Island, winner of the first Academy Award for Documentary Short Subject.^[14] The Gander Air Base land-lease is assumed to have been written in 1939–1940. Upon Newfoundland joining Canada in 1949 the lease is assumed to have terminated as Newfoundland was part of Canada.

Canada also made loans to Britain during and immediately after the war under terms similar to the Anglo-American loans, these loans were fully repaid in late 2006 along with the American loans.^[3] A portion of the Canadian loan was written off in 1949 as part of the agreement to bring Newfoundland into Canada.

The UK may have had similar (but more limited in scope) land-lease arrangements during World War II with The United Provinces of India, Australia and New Zealand—but the Gander lend-lease model was not the predominate kind of arrangement in these regions.

See also

• Arctic convoys of World War II
• Arms Export Control Act
• Atlantic Charter
• Battle of the Atlantic (1939–1945)
• Cash and carry (World War II)
• Lend-Lease Sherman tanks
• Marshall Plan
• Military production during World War II
• Northwest Staging Route
• Operation Cedar
• Persian Corridor
• Keynes World War II loan

References

Notes

Bibliography

Further reading

George Racey Jordan, USAF (Ret.), with Richard L. Stokes, From Major Jordan’s Diaries (Harcourt, Brace and Company, 1952). Major Jordan was a Lend-Lease expediter and liaison officer with the Russians, from May 1942 to June 1944, at both the Newark Airport, NJ and at Gore Field at Great Falls, Montana. His experiences and records were the focus of Congressional hearings in December, 1949 and March, 1950, since materiel and information were delivered to the Soviet Union which were not directly related to waging war, but rather related to atomic weapons research and building Soviet industry after the war. See, for example, the discussion of Major Jordan and Lend-Lease in:Romerstein, Herbert and Eric Breindel. The Venona Secrets: Exposing Soviet Espionage and America’s Traitors. Washington, D.C.: Regnery, 2000. ISBN 0-89526-275-4.

External links

• Official British history of Lend-Lease
• Lend-Lease Shipments, World War II (Washington: War Department, 1946)
• Lend-Lease to the Soviet Union
• The Voice of Russia on the Allies and Lend-Lease Museum, Moscow
• Official New Zealand war history of Lend-lease, from War Economy
• Official New Zealand war history; termination of Mutual Aid from 21 December 1945, from War Economy
• Allies and Lend-Lease Museum, Moscow