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Lend-Lease

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Consequences of Lend-Lease

  • After re-election FDR found it would be necessary to go beyond the legal make-shifts he’d been using to help GB
  • GB needed US war supplies but were running out of money
  • Johnson Act 1934 banned loans to states in default of their WWI debts
  • Doubtful whether Congress would repeal it without a prolonged fight
  • FDR came up with the idea of lending goods not money
  • January 1941 he submitted draft of a Lend-Lease Bill authorising him to sell, lease or lend on such terms as he saw fit to any country he deemed vital to US security
  • Two months acrimonious debate ensued
  • Wheeler, Taft and other isolationists said it was a permit to wage undeclared war

American Viscose Corporation

  • To overcome Congress opposition and convince the public that GB on verge of bankruptcy FDR urged the sale of all privately owned GB investments in US
  • Churchill reluctantly agreed to sell one asset – the American Viscose Corporation at a price well below its intrinsic value
  • Lend-Lease Act passed Congress easily and FDR signed it March 11th 1941
  • Churchill described Lend-Lease as “the most unselfish act of any country in all history”
  • This didn’t represent his true feelings
  • He resented the forced sale as an unnecessary political manoeuvre
  • He ultimately saw it as a small price to pay for $7,000 million of aid

Protecting the Sea Lanes

  • By spring 1941 German U-boats sinking 500,000 tons of shipping a month
  • This was twice as much as GB and US ship yards were turning out
  • FDR took steps that gradually edged USA into Battle of the Atlantic
  • Showed lack of candour in justifying his actions
  • Some historians say he “lied the country into war”
  • March 1941 he allowed damaged British warships to be repaired in US docks and RAF pilots trained in Florida
  • April he extended the hemisphere neutrality zone (proclaimed at Panama 1939) halfway across the Atlantic
  • US naval patrols to comb area for U-boats and report their presence to Royal Navy
  • Sent US forces to Greenland
  • June froze German and Italian assets in USA
  • July (by agreement with Icelandic government) sent US marines to Iceland to forestall German occupation
  • September convoyed US vessels as far as Iceland

Atlantic Charter

  • Meanwhile an informal Anglo-American alliance taking shape
  • Spring 1941 secret talks in Washington between British and US officers
  • Made an agreement on strategy to be followed if US entered war
  • August FDR and Churchill held their first wartime meeting at Newfoundland
  • FDR made no military commitments
  • Joined Churchill in issuing a press release that became known as the Atlantic Charter
  • It was a declaration of general principles: national self-determination; equal access to trade and raw materials; international collaboration for economic advancement and social security; freedom from fear and want; freedom of the seas; disarmament
  • Despite the publicity attending Atlantic Charter it had no influence on post-war settlement
  • It was unprecedented for a neutral country to join a belligerent in issuing such a document however vague and innocuous

Hostilities

  • FDR hesitated to take any step that would commit US to full belligerency
  • Held back due to isolationist sentiment and his own indecision
  • Just as Lend-Lease led to convoying so latter led to open hostilities
  • September 4th 1941 U-boat fired two torpedoes at US destroyer “Greer” (missed) – latter dropped depth charges
  • FDR hid fact that “Greer” had reported the U-boat’s position to Royal Navy
  • He interpreted the incident as an act of piracy
  • Ordered that Axis subs be sunk on sight in US-patrolled waters
  • October 9th FDR asked Congress to revise Neutrality Act to arm American merchantmen and allow them to sail to belligerent ports
  • During the Congressional debate the US destroyer “Kearney” was attacked (October 17th) – 11 killed
  • October 31st US destroyer “Reuben James” sunk with 115 killed
  • Week later Congress abolished Neutrality Act except: ban on loans to belligerents and travel on belligerent ships
  • US merchant ships could now carry any cargo to combat zones
  • Autumn 1941 US in undeclared naval war with Germany
  • Hitler would have been justified in taking counter-measures – he didn’t though
  • Invaded USSR in June – anxious to avoid US belligerents

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