“Well, Skipper,” he said finally, “it looks as though you had sold United Aircraft something, whether the Army buys it or not. We’ll start building our own war-plans organization and get it ready for trouble.” After our estimates of the cost of such a program had come in, we discovered that they totaled just $10,000 per year, the figure Glenn Martin had mentioned down in Washington, but, like Glenn, we had no idea where the money was to come from.
In anticipation of the gradual drying up of government business and with a view to trying to get funds from Congress to help tide us over slack periods, Don Brown had outlined his situation to BUAERO and the Army Air Corps. As a result of efforts by the Armed Forces, Congress had appropriated funds for new engines to be ordered from Pratt and Whitney. It had seemed to us at the time that, with war imminent, the administration might have made better use of relief funds than raking leaves. As a matter of fact, a good deal of relief money was being invested in air fields and armament, but the program was not coordinated; Mr. Ickes and Mr. Hopkins differed as to who was boss. The idea prevailed that peace could be had by just wishing for it. To have spent money for arms, or even to have directed it into the business stream so as to keep the production machine at a high level, would, at that time, have been considered unmoral. On the other hand, spending money wastefully for made work seemed to meet with public approval. The bald fact remained, however, that with war but a few months away, Pratt and Whitney Aircraft, one of the two dependable sources of proved aircraft engines, faced a shutdown, and with it, dispersal of an organization which could never have been reassembled.
To our relief, however, Congress appropriated funds, and the Army notified Pratt and Whitney that it might proceed with the procurement of materials and the production of engines in advance of the formal contract, with the idea of utilizing the allotment to best advantage from the point of view of readiness for emergency. Then, sometime after we had swung into our program, the Air Corps, to our amazement, canceled this informal assurance, and diverted the funds to the procurement of Allison liquid-cooled engines. At that time the General Motors Corporation, owners of Allison, had indicated little need for public relief funds, but to Pratt and Whitney, now almost wholly dependent upon government business, the loss of this critical order was a body blow.
When, later, Don called upon the Assistant Secretary of War, Mr. Louis Johnson, to point out to him the results of his decision, he was advised that the Army had decided to scrap all air-cooled engines in pursuit planes. Next year would probably see the last of air-cooled engines in bombers. He was instructed to start Pratt and Whitney designing liquid-cooled engines at once. To Don, knowing that Allison, equally surprised by the decision, had not yet started tooling, while Pratt and Whitney, already tooled, must remain idle, the decision hardly made sense.
Somewhat bewildered by the change, Don then called on Hap Arnold. Here he learned that the secretary’s decision had also taken the Air Force by surprise. Anxious to keep Allison ticking over, Wright Field had built up such a strong case for liquid-cooled, that the secretary had decided to scrap air-cooled. Since recent pursuit planes like the Seversky had been designed for air-cooled, the decision had left them on a spot. Apparently, however, the decision once taken could not be recalled. No one in the Air Force had dreamed for a moment that it would be taken, but here we were, out on a long limb, and war was in the offing.
As the year 1938 came to a close, we began laying off men, dropping first those who could be the more readily spared. But the time came when the organization was being seriously hurt, and the year-end forecast indicated that, by July, 1939, we would reach the end of our production. Since materials must be in hand five to six months ahead of delivery of the finished article, that meant that time had already begun to run out for Pratt and Whitney. We had long since cut back expenses to the bare minimum and there remained nothing but a final decision to suspend manufacturing operations. Yet even then, Don Brown kept the War Plans Division intact.
Now we had but a single remaining hope: Tom Hamilton in Paris. Tom reported by radiotelephone that the French, now reduced to dire straights, still vacillated, but had established financial credits in the United States and would send a purchasing commission to Washington to open negotiations direct with us. Don Brown, sick as he was, went down to Washington with some of our staff to battle through hours of legalistic verbiage, in smoke-filled rooms of Washington hotels.
Here it developed that the United States Treasury would act as a sort of intermediary between the French commission and the American manufacturers, and that Secretary Henry Morgenthau had turned the job over to Capt. Harry Collins, then head of the Purchasing Division of the Treasury. With the Arms Embargo Act still adorning the legislative library, active participation by the Treasury in negotiations between United States arms manufacturers and a possible “belligerent” had certain aspects of incongruity. However, the whole situation was so phony that this detail escaped public attention.
Capt. Harry Collins provided just the savoir faire necessary to resolve an impossible situation into a completed contract. Harry had served as supply officer on the ancient destroyer-tender Iris back in the dark ages when I had commanded the four-piper Truxtun, then based on San Diego. He had resigned his commission to go into business and had there shown the same tact that had endeared him to the temperamental skippers of the Pacific Torpedo Flotilla.
Throughout the negotiations, Don Brown stood fast on the principle that prices to be paid for the equipment should be high enough to permit us to take the necessary financial risks required by the early deliveries specified. The customer should not hamstring us by chiseling prices to the point where our willingness to accept risks was impaired. Fortunately the soundness of this position was apparent to Harry, and his confidence in us enabled him to support it in the discussions with Col. Paul Jacquin of the French commission. The colonel proved to be a man of high character with a sense of fairness and a degree of integrity that finally brought the negotiations to a satisfactory conclusion.