Bill Boeing, for instance, might have continued to use the war-surplus Liberty-engined DH’s indefinitely, had not competition for the air-mail contract forced him to risk a low bid and then build new aircraft to meet his own standards. And so price competition, which many were beginning to think was cutthroat and destructive, was over-all, the key to progress in aeronautics.
The engine manufacturer, for instance, must experiment with new ideas, conduct research into strange fields, and come up with something so economical that the airline operator can’t get along without it. That will obsolete his airplanes, retire them to some embryonic service that cannot yet afford new types, and force him to introduce the newest and latest models—or else go out of business. Competition, Fred insisted, was not destructive, but creative; it was tough on the one who lost his shirt, but favorable to the public at large.
Fred went on to develop the vast difference between the volume-producing industries, where low first cost was the incentive, and the aircraft industry, where low operating cost was the real criterion. The airline operator could afford to pay a high price for high quality aircraft, provided he reduced his operating costs enough to absorb the first cost in a reasonable time. The whole character of the two types of industry differed, and neither could expect to do the other’s job. Technological development was the key to the economic security of an enterprise like aviation. The way to keep in the forefront was to stress your engineering; once you got behind you could never catch up, unless the other fellow broke a leg and fell down. Yes, he thought, this aviation was a funny business. At this remark, Chance Vought woke up.
“The thing that is funny about it,” he said sleepily, “is that it has at last become a business.”
I sat looking out over Rock Creek Park as it faded into the shadows. The conversation had pointed up a new situation in my own affairs. If aviation was now a business, then my job here was finished. You could hardly have called it that three and a half years ago, and the time had come for me to go to sea, lest some Selection Board pass me by. I’d go see Admiral Moffett in the morning.
But in the morning the admiral was, as usual, one jump ahead of me. I found a note on my desk instructing me to see him the first thing. In his corner office he waved a letter at me, one scrawled in longhand in the bold writing of Rear Adm. Joseph M. Reeves, Commander, Aircraft Squadrons, Battle Fleet. It was dated at San Diego, California, on the Langley, and it took note of the fact that the carriers Saratoga and Lexington were scheduled to join the fleet in a year or so. His chief of staff, Karl Smith, was ill and he needed a relief for him. He asked if I could be made available.
“Bull” Reeves was a distinguished officer and an able commander. Only a year or two earlier he had dropped in on me in the Engine Section to inquire if I thought he should accept an invitation to join the aeronautic organization and go to Pensacola for instruction with the ultimate idea of succeeding to command of the Aircraft Squadrons, Battle Fleet. He had graduated from Annapolis into the old Engineer Corps but later, upon amalgamation with the line, had qualified for command. A hero of Naval Academy football, he had been on duty at Annapolis as an instructor while I had been a midshipman, and he had been rated “white” by all hands—the highest commendation an officer could earn from the brigade. During the Spanish American War, he had made a name for himself in the engine room of the old Oregon in her dash around the Horn. Admiral Moffett was smiling at my obvious satisfaction.
“Yes,” he remarked, “you should be a big help to me out there.”
I put in a request for a month’s leave and bought tickets for my wife and myself on the Panama-Pacific liner, Mongolia, sailing direct for San Diego via the Panama Canal. We sailed from New York where Fred Rentschler, Chance Vought, Guy Vaughan, and many other friends in the aircraft industry saw us off. After a lovely cruise through the Caribbean and the transit of the Canal, we headed north for the West Coast and San Diego, where my wife and I had first set up housekeeping at the Coronado Hotel, while I served my tour of duty in the old Pacific Torpedo Flotilla. It was there we had made our first contact with aviation.
When the Mongolia pushed her nose into San Diego harbor that morning late in October of 1927, the bright sun glittered on the white sands of North Island just as it had done some fifteen years earlier when we had last looked upon this pleasant scene. Meanwhile, however, North Island itself had undergone change. Then it had been a flat, brush-covered expanse on which we had hunted jack rabbits; now a latticed airship mooring mast thrust its height above a cleared surface, and white hangars lined the shores of West Beach. The mooring mast, located there as a haven for Admiral Moffett’s rigid airships, lay down near the entrance to the ship channel; the hangars, intended for heavier-than-air craft, faced across the bay to San Diego or across Spanish Bight to Coronado Island’s bungalows and cottages. The ancient Hotel del Coronado, with its white sides and red-pinnacled roofs reminiscent of the lush days of the land-and-railroad boom, still dominated the bright scene.