Lend-Lease

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 11^th 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 4^th 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 9^th 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 17^th) – 11 killed
October 31^st 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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