“This is a steel war,” wrote Winston S. Churchill in September 1917. The British minister of munitions emphasized with these words the need for the Allies to supply more material to the war effort. He insisted that America and the Allies would have to exceed German steel production. After the Allied defeat at the Somme in November 1916, British military leaders became inclined toward waging a war of attrition against Germany. This concept required all-out economic mobilization, which in turn constituted an important step toward total war. As the nation that was richest in material resources, money, and men, the United States held the key to this endeavor. Churchill's statement reflected a widespread concern: Could the United States mobilize its economy fast enough to block the Reich's attempt to defeat the Allies in an all-out offensive before the Allies' combined war production brought its defeat?

General Erich Ludendorff s call for an armistice thirteen months later provided a definitive answer to that question. This call resulted largely from the fact that the United States had surpassed Germany's war production. By the fall of 1918 the Allied economic war against Germany had weakened the German army, dispirited its leaders, and demoralized the population of the Reich.

This chapter examines the economic war effort of the United States after it entered the conflict. It assesses Washington's financial contribution to the Allies as well as the flow of American supplies, and it analyzes the difficult choices that confronted the Wilson administration. It likewise examines the problems that the government of the United States, despite little preparation, overcame in providing maximum support to the Allies while preserving America's status as an independent arbiter in the conflict.