Even with this deduction, the Wool Administrator had, in the late autumn of 1918, about 460,000,000 pounds of wool to dispose of. The normal textile industry had never before been called upon to absorb such a visible supply, and there was some question if it would be able to do so. The manufacturers naturally began at once to urge the Government to dump its wool on the market. The 700,000 American wool growers, on the other hand, who had been receiving a high and stable price for wool (the price adopted on July 30, 1917) urged the Government to stay in the business for another year at least and take the 1919 clip at the war price.
The decision in Washington was to sell the wool and get out of the wool business at once. This was displeasing to the farmers; but, to prevent any drastic slump in wool prices, the War Department decided to sell its wool in auction sales, in which the Government itself would set minimum prices below which no wool would be sold. This action guaranteed that the growers would get a fair price for the 1919 clip.
Within approximately a month after the armistice the wool auctions began—first at Boston, where in three days (December 18, 19, and 20, 1918) the buyers bid in over 10,000,000 pounds of wool, out of 17,000,000 pounds offered for sale. The unsold offerings, of course, were lots for which no buyers bid up to the minimum fixed prices. Although prices were fixed, only in a sense were they sustained artificially. For each sort of wool the Government fixed a minimum price which equaled what it would cost to import the same quantity and grade of wool and deliver it to the American market. Thus the world prices actually prevailed, except that the huge American surplus was artificially kept from being a depressing factor in the world price. To sustain prices higher than these would have attracted large importations and thus injured the growers. To allow prices to go lower than the importation prices would also have worked injury to the wool growers of the United States.
As a further concession to the farmers, the Government announced that it would stay out of the wool market when the 1919 American clip began reaching the market in quantities sufficient to supply the mills. In accordance with this promise, the government wool sales ceased on July 1, 1919, and did not resume again until the following November.
When the auctions suspended on July 1, more than 316,000,000 pounds of the Government’s wool had been sold. Auctions had been held twice a month in Boston and once a month in Philadelphia, and three sales had been conducted at Portland, Oregon, for the benefit of the western woolen mills. Upon the resumption of the sales in November the wool continued to sell well, with the result that by the end of 1919 the sales had disposed of 365,000,000 pounds, and the success of the complete liquidation was assured. The sale of this wool was a triumph of merchandizing. The wool trade had never known such sales before, not even in England, the world center of wool, nor had the American trade ever before absorbed such a quantity of wool in such a short time.
Like the storied mill which ground salt until it swamped the ship of the thieving merchant, the mill producing quartermaster supplies before the armistice was hard to stop afterwards, and its output embarrassed the War Department for want of space in which to store the excess supplies. As long as the home Army and the A. E. F. were expanding in size and the convoys grew in size and frequency, there was no critical backing-up of supplies. Immediately after the armistice, however, the order came to ship no more freight to France, except food and other necessaries specifically requested. At the time of the armistice there were 600,000 tons of supplies on the docks in this country and 400,000 other tons moving toward the seaboard. Since the mills kept right on producing more, the flood of new materials inundated the supply service in this country. In December, 1918, the Storage Service was operating 65,000,000 square feet of warehouse space in the United States. A year later it was occupying nearly 400,000,000 square feet, three-fourths of which was leased. A large quantity of this space was open storage, unprotected from the elements. These figures are exclusive of the quantities of warehousing and open storage occupied by the various technical bureaus, such as the Ordnance Department, the Air Service, and the Signal Corps. The operation of the general storage facilities was the charge of the Director of Storage, one of the chief functionaries of the Division of Purchase, Storage, and Traffic.
An even greater problem than storage was the disposition of the enormous surpluses of goods which accumulated after the armistice. The first concern of the War Department in approaching this question was the military future of the United States. In 1914 much was made of the thoroughness of German military preparation, which had been such that, when the fatal hour struck and the conscripts by hundreds of thousands left their homes and poured into the German barracks, for every man there was waiting ready a uniform, shoes, a helmet, underclothing, and everything needed to prepare him immediately for service in the field. What Germany had been able to accomplish by premeditated, long, and expensive effort, the United States now derives as a by-product of the war Germany forced it to fight. America, too, is now prepared in these minute details. Before any of the surplus quartermaster stocks were set aside for sale or other disposition, a complete and balanced selection of uniforms, overcoats, underclothing, socks, caps, shoes, and other nonperishable articles in the individual equipment of troops, in quantities sufficient to outfit an army of approximately 1,000,000 men, was set aside and placed in indefinite storage. In addition, stores of such supplies were retained for the future consumption of the regular standing Army, of the National Guard, and of the Reserve Officers’ Training Corps.
The war construction provided for the War Department three enormous interior reserve depots located respectively at Schenectady, New York, New Cumberland, Pennsylvania, and Columbus, Ohio. In these many of the reserve quartermaster supplies are stored. These installations are all of permanent and spacious construction. The warehouses are nearly all one story high, built of hollow tile and concrete, and divided into sections by fire walls. For additional storage the War Department is also using numerous wooden warehouses built at the retained cantonments. These buildings, though well constructed, are not fireproof and have to be guarded carefully to prevent their destruction.
It was found further that various branches of the Government could make good use of supplies originally procured for the Army. Many of the army hospitals were turned over to the Public Health Service, and with the hospitals the War Department delivered large quantities of medical supplies. Incidentally it may be noted here that the Army has retained and stored sufficient field medical equipment for an army of 1,000,000 men. Large lots of such general supplies as hardware, tools, rope, brushes, and office furniture went to the Bureau of Public Roads, the Interior Department, the Panama Canal, and other federal agencies.
Then, several foreign governments were allowed to purchase from our excess supplies. Clothing, textiles, medical equipment, and other supplies, all to the value of $20,000,000, went to various Russian societies. The French Government took machine tools and other machinery originally built for the Engineers, to the value of $25,000,000. Belgium bought a large quantity of construction materials.