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The Lend-Lease Act

H.R. 1776 becomes Great Britain's savior in 1941

On Dec. 3, 1940, a month after a grueling presidential campaign that culminated in his successful re-election to a third term, President Franklin Roosevelt boarded the cruiser USS Tuscaloosa for a 10-day cruise through the Caribbean on a working vacation.

America was not yet involved in the war that was wracking Europe and Asia. But Roosevelt believed America’s active participation was a question of when, not if. With the election behind him, he planned to use the time aboard the Tuscaloosa to mull without distraction how to prepare the American people for war. He had other problems to deal with as well. One of the most vexing was how to keep Great Britain in it.

“By the end of 1940, Britain’s war chest of dollars was down almost to two billion, and of this nearly a billion and a half was already pledged to pay for war goods ordered here but not yet delivered.”

Production officials assured him that American industry was capable of arming both the United States and Great Britain. But under existing cash and carry laws, for how long could Britain continue to buy arms? Britain had started the war with convertible reserves totaling roughly $4.5 billion. Despite adding almost another $2 billion through luxury exports, sales of gold, and other sources, Britain was spending money faster than it was making it. Edward R. Stettinius, Jr., then National Defense Advisory Commission chairman, later wrote, “By the end of 1940, Britain’s war chest of dollars was down almost to two billion, and of this nearly a billion and a half was already pledged to pay for war goods ordered here but not yet delivered.”

First page of H.R. 1776, which became the Lend-Lease Act of 1941. National Archives photo

War loans were out of the question. America had done that for the Allies in World War I, and it had been a disaster filled with defaults, economic dislocation, and acrimony.

Some members of the Treasury Department had found something that seemed to offer a solution, though no one dared suggest how it could be applied to this situation. On page 621 of the 1,159-page The Military Laws of the United States was a statute dated July 28, 1892, that said in part: “Authority is hereby given to the Secretary of War, when in his discretion it will be for the public good, to lease, for a period not exceeding five years and revocable at any time, such property of the United States under his control. …”

Harry Hopkins, Roosevelt’s trusted advisor, recalled, “I didn’t know for quite a while what he was thinking about, if anything. … Then, one evening, he suddenly came out with it – the whole program.” The nation and the world would discover what that program was within the week.

On Dec. 9 off the coast of Antigua, a Royal Navy seaplane landed near the Tuscaloosa with a long memorandum from Prime Minister Winston Churchill for the president. Churchill later said it was “one of the most important I ever wrote.” Churchill summarized the recent losses Britain had suffered, and stated that he and his nation were resolved to wage ongoing war against Nazi Germany. But, Britain needed military help on a scale only America could provide. As for paying for those arms, Churchill starkly laid his cards on the table. “The moment approaches where we shall no longer be able to pay cash for shipping and other supplies. … I believe you will agree that it would be wrong … if, at the height of this struggle Great Britain were to be divested of all saleable assets … [and] stand stripped to the bone.”

To members of his staff, it appeared that Churchill’s memorandum had not made an impact on the president. Harry Hopkins, Roosevelt’s trusted advisor, recalled, “I didn’t know for quite a while what he was thinking about, if anything. … Then, one evening, he suddenly came out with it – the whole program.” The nation and the world would discover what that program was within the week.

Roosevelt returned to Washington on Dec. 16. The following day he held a press conference and summarized to the nation the world crisis and its threat to America’s security. He said that unless the United States became an “arsenal for democracy,” this crisis would consume the country. Then using stories of helping neighbors in distress to illustrate his point, such as lending a garden hose to a neighbor to help extinguish a house fire threatening his home, Roosevelt announced his administration’s plan to provide arms to Great Britain without bankrupting it. The foundation of the program rested on the terms of the War Department lease statute that the Attorney General ruled was valid for this crisis. Basically, he proposed that Britain would lease what it needed under terms to be determined by the War Department.

A bill, felicitously numbered H.R. 1776, was submitted and, despite blocking efforts by isolationists, was passed by Congress and forwarded to the president. On March 11, 1941, the Lend-Lease Act was signed into law. Churchill called it “the most unsordid act in the history of any nation.”

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DWIGHT JON ZIMMERMAN is a bestselling and award-winning author, radio host, and president of the...