Uncle Sam: Postwar junk dealer
Following WWII, everything from planes to watches was up for sale. Uncle Sam was in liquidation mode!
During WWII, the United States spent $288 billion in 1940 dollars, equivalent to $6.5 trillion in 2024 dollars. By the end of WWII, much of that money was just gone. It had been spent on bombs, on airplanes that had been shot down, on soldiers’ salaries, and on aid to our Allies. However, some of the money had been spent on things that were still around; things like military bases, buildings, trucks, food supplies, and reportedly, hundreds of thousands of body bags that weren’t needed because of the abrupt end of the war in the Pacific. Some equipment, such as navy ships, could be mothballed.
Between 1945 and 1947 the U.S. military shrank by 87 percent, from 11.9 million servicemen to 1.6 million. Nevertheless, the end of the war triggered an enormous sale of surplus materiel at a magnitude that had not been seen before — and probably never be seen again.
The U.S. had learned from the previous war. After WWI, ships, airplanes, and large guns were mothballed for future military use, but most of those items were obsolete long before the next war. Surplus sales after WWI, which had been at a small fraction of original cost, had caused howls from Congress and the American public. To many in the military, it was better to do nothing than it was to move quickly and look foolish, so sales did not proceed rapidly. The Navy and Army (and soon, the Air Force) were reluctant to identify surplus before they knew the size of their future authorized personnel and Congress was slow to define the size of peacetime armed forces.
After a series of politically motivated fumbles, Congress created the Surplus Property Administration to manage the disposal of an estimated $90 billion of government property located in more than 5,000 locations in every state and overseas. Perhaps 90 percent of those assets were in the 48 states. Many overseas assets weren’t included, either because they were needed for the reconstruction of war-torn countries, or because they had little or no application to civilian use. Bombs, tanks, and some communications equipment couldn’t be sold to just anyone.
The list of items available for sale to the public would fill several phone books. Some examples included:
47 million yards of jute burlap strips - previously destined to become camouflage — in six colors, stored in 33 rail cars.
A 300,000-square foot manufacturing plant in Burlington, N.C, complete with an airport.
A Navy landing craft, LCVP #C-9596, 36 feet long, located in Attu, Alaska.
500,000 wrist watches
57,000 herringbone twill fatigue jackets
Hundreds of Higgins boats
Real estate that had held POW and Army training camps
To limit the profits of businesses that participated in surplus sales, the government sometimes set a ceiling on the price at which goods could be retailed. For example, when the U.S. Army sold 4,000 rowboats designed for infantry assaults, it set a maximum retail price of $75. It’s unknown whether such controls were effective — but it seems unlikely.
The government just didn’t have the time or the personnel to handle the retail sales of small quantities of goods. At first, most surplus sales were reserved for businesses, although this was later relaxed. That meant that an Army dentist, recently released from the service, couldn’t buy his dental equipment from the Army. He typically had to go to a wholesaler of dental equipment who had just purchased the surplus equipment. However, to help him with the purchase, GI loan programs would finance the purchase of equipment to start a business. Items for personal use, such as vehicles, were typically sold at a predetermined price. Items intended for resale by businesses were sold based on a written bid.
Eleven designated districts were created, each serving multiple states. District 1, headquartered in Boston, handled assets in Connecticut, Maine, Massachusetts, New Hampshire, Vermont, and Rhode Island. District 11, in Seattle, handled sales in Oregon, Montana, Idaho, and Washington State. Unfortunately, that meant that an ex-fighter pilot who traveled hundreds of miles to try to purchase a Piper Cub might be awarded a plane located 500 or more miles away.
Overseas assets had a different hierarchy of claims: First, overseas agencies of the federal government; second, reconstruction relief agencies, such as the UNRRA - the United Nations Relief and Rehabilitation Administration; third, U.S. veterans living overseas, and fourth, Allied governments. This meant that most vehicles present in Europe at the end of the war were turned over to local governments to replace government vehicles destroyed in the war. This served to speed the recovery of a devastated Europe. The French postal service might request 1,000 jeeps for use by their postal service The German forestry service could request 200 Dodge trucks to restore logging operations.
Sales of assets to other governments were problematic. In many cases, it was unclear who had the authority to make a decision for a particular city, state, or country. And if a foreign government wanted to buy, what currency was acceptable for payment? And what exchange rate would be used? Overseas sales resulted in some very bizarre results.
The U.S. sold all of the assets in one European district to a local government for $400,000. That government, immediately resold most of the assets to private sector companies, who shipped them to U.S., where they were sold at huge profits.
President Truman argued for faster sales of surplus to speed the restoration of foreign economies. Although $5 million in materials in Italy had been identified by the summer of 1945, just 10 percent had been designated as suitable for sales to civilians, and little had been released.
Espiritu Santo, an island in the South Pacific, was an enormous Allied base with as many as 40,000 soldiers and sailors, and eight movie theaters. It was famously the home of VMF-214, the “Black Sheep” squadron. After the war, an attempt was made to sell hundreds of vehicles, thousands of pieces of equipment, and mountains of building supplies, to the local government, which was a joint venture of the French and the British. Their target buyer’s perception was that there was no way that the U.S. was going to ship the assets to another market, and they refused to negotiate a price. Frustrated, Navy Seabees built a ramp and dumped the surplus into the ocean. That place is now known as Million-Dollar Point, and is a popular location for scuba divers, who find bulldozers, cranes, trucks, crates of clothing and cases of Coca Cola.
137 bombers and 9 fighters that were interned by the Swiss during WWII were sold to the Swiss for scrap.
Hollywood stunt pilot Paul Mantz bought 475 bombers and fighters in the U.S. for $55,000, or $115.79 per airplane. He reportedly sold the fuel in the tanks for more than that, and then sold airplane parts around the world for a number of years. Some of the parts were sold back to the U.S. military, which had misjudged their needs. Ultimately, he sold the rest as scrap metal for $160,000. Mantz died in a plane crash during the filming of the 1965 film The Flight of the Phoenix, which starred Jimmy Stuart.
In 1946, Congress pivoted responsibility to another entity, the newly formed War Assets Administration. An estimated $28 billion in personal property suitable for sale to the private sector remained to be sold. A major concern for Congress was to avoid the disruption of businesses that were returning to the manufacture of products suitable for the private sector.
For example, in December, 1945 surplus medical supplies were estimated to total 50 percent of annual U.S. production. Medical suppliers, who had worked so hard to support the war effort, were obviously sensitive to the timing and pricing of sales. To protect U.S. auto manufactures, the Dodge 6x6 trucks, jeeps, and motorcycles that had made their way to Europe would not be returned to the U.S. At least, that was the goal.
Camp Adair, Ore., was typical of the real estate to be sold. It included 89 square miles of land and 1,700 buildings. Adair was rapidly constructed in the year following the attack on Pearl Harbor, and served as a training facility, and briefly as a camp for German and Italian prisoners of war. Following the war, much of the land was repurchased by the farmers who had sold the land to the Army just a few years before. Some buildings were sold for nominal prices and moved to other locations.
American Allies faced similar issues in dealing with surplus. In 1946, Cranfield Aeronautics College, located north of London, requested a modern aircraft with hydraulic wing-fold as a learning aid for its students. In 1963, students there decided to wheel their Corsair down to the local village pub under the cover of night. This naturally caused a buzz of amusement in the village and the college set out to retrieve the bird with a tractor. Shortly after the incident the plane was transferred to the Fleet Air Arm Museum, in Yeovilton. It was the only survivor of around 2,000 of this model delivered to the British. The rest were scrapped. In 2000, restoration of this aircraft KD431, began, revealing layers of paint last seen in 1946.
Art Lacey of Milwaukie, Ore., decided that what he needed was airplane wings to cover the pumps at his new gas station. The government had paid Boeing $283,000 just two months before for it, but Lacey paid just $1,500 for his B-17. Although he had never flown anything bigger than a single-engine Cessna, he took off for a training flight, and crashed the plane while landing. The War Assets Administration simply substituted another plane, B-17G 44-85790, at no charge. This plane had flown just 50 hours.
