During these years Baruch began to put his wealth to use in politics and public affairs. He responded to the rising civic consciousness of the Progressive era. He took an interest in New York City politics and became a friend and admirer of Woodrow Wilson. Baruch and Wilson shared a number of values; both sought a place in the lineage of great American patriots. It is significant that Baruch did not believe that his Jewishness barred him from this opportunity; he regarded himself as an assimilated Jew. He married an Episcopalian, Annie Griffen, on Oct. 20, 1897, and their three children were raised as Christians. Wilson and Baruch also saw themselves as independent, autonomous individuals outside the established centers of political and financial power. Their southern backgrounds offered further grounds for empathy. (In 1905 Baruch acquired a South Carolina estate, the Hobcaw Barony, where he lavishly entertained visiting politicians in subsequent years.)
Above all, Wilson valued that rarity, a Democrat on Wall Street. After 1915, as the United States edged closer to war, Baruch, a preparedness advocate, received a series of appointive posts in the government's fitful mobilization program. In the summer of 1916 President Wilson appointed him to the seven-man Advisory Commission of the Council for National Defense, a cabinet committee responsible for national mobilization. In the spring of 1917 Baruch enlisted former business contacts to negotiate and administer informally a series of raw material purchases for the military. Later that summer he became commissioner for raw materials in the newly formed War Industries Board (WIB).
Domestic mobilization ground to a halt in the winter of 19171918. In March, Wilson elevated Baruch to the WIB chairmanship and designated the board the major civilian agency for industrial mobilization. Baruch did not acquire sole decision-making authority for industrial mobilization; for example, he did not displace military prerogatives in contracting. Yet his position as chairman, combined with membership in the president's war council, gave him a strategic position at the heart of the government's competing mobilization agencies.
Baruch's was one of the outstanding success stories of World War I. He entered Washington a private speculator and emerged a public statesman. Rapid recruitment of an expert, knowledgeable staff; a sure grasp of power politics; sensitivity to the uses of private dealings and public relations; and loyalty and sensitivity to presidential wishes contributed to the transformation. Wilson's decision to take him to the postwar peace conference also helped. In Paris, in 1919, Baruch became chairman of the raw materials section of the Supreme Economic Council and a delegate to the committees on economic and reparation clauses, where he fought a losing battle against British and French demands for greater German reparations. With the assistance of John Foster Dulles, a fellow delegate, he recorded his experiences in The Making of the Reparation and Economic Sections of the Treaty (1920).
Baruch remained loyal to Wilson's memory for the rest of his life. Although self-taught in business, he learned his political philosophy from Wilson. He shared the view of Wilsonians and corporate spokesmen that social stability and economic prosperity in the postwar world required newer forms of cooperative institutions among business, labor, and agriculture, and between business and government. The virtues of private enterprise and the law of supply and demand remained central values, but he believed that historical changes had made conventional laissez-faire impractical. His acceptance in October 1919 of a place on the National Industrial Conference Board, which was charged with finding a way through the postwar epidemic of labor strikes, was consistent with this view. So were his postwar recommendations for antitrust revision. Baruch offered the same kind of advice during the New Deal experimentations with business cartelization under the National Recovery Administration (NRA).
During the Republican ascendancy after World War I, a beleaguered Senate Democratic leadership proved particularly receptive to Baruch's generous campaign contributions. It was partly because of Baruch's advice that in 1933 President Franklin D. Roosevelt appointed Hugh S. Johnson, a Baruch protégé, head of the NRA, and George N. Peek, another Baruch associate, head of the Agricultural Adjustment Administration. Baruch shrewdly employed the power of publicity in his interwar campaign for industrial preparedness. He commissioned Grosvenor B. Clarkson's portrait of the WIB, Industrial America in the World War (1923), and he championed such postwar experiments in industrial-military planning as the Army Industrial College, founded in 1924. He also participated in the compilation and subsequent revisions of the War Department's Industrial Mobilization Plan of 1930 in hopes of persuading military officers to accept civilian business planning for war under a reconstituted WIB. Baruch preached a message of total mobilization of population and resources and complete economic stabilization through comprehensive price and wage controls in the event of war. He made his case before the War Policies Commission in 1931 and the Nye Committee in 1935; in 1941 he capped his prewar sermons with the reissue of the WIB's final report of March 1921, American Industry in the War.
By the late 1930's, Baruch had come to symbolize the lessons of World War I. Roosevelt frequently and publicly consulted him on defense matters. But three factors barred Baruch's path to supreme authority in defense organization. Before Pearl Harbor and a declaration of war, the public would not countenance the creation of the post Baruch coveted. Liberal New Dealers mistrusted Baruch as a stalking-horse for conservative business and military interests. And Roosevelt, ever jealous of his own prerogatives, opposed a WIB beyond White House control. As a result, Roosevelt excluded Baruch from the War Resources Board established in 1939, and he resisted the concepts of one-man emergency control and comprehensive price controls throughout 19401941.
After Pearl Harbor political and economic conditions favored Baruch's recommendations, although he never became the mobilization czar of World War II. He possessed political influence, but not administrative power. Friendships with key war administrators provided a major source of Baruch's wartime influence. James V. Forrestal, undersecretary and then secretary of the navy; Robert P. Patterson, undersecretary of war; Ferdinand E. Eberstadt, chairman of the Army-Navy Munitions Board; and James F. Byrnes, chief of the Office of War Mobilization in 1943, were all receptive to his advice. And Baruch gave it: a consistent plea for one-man administrative control. In early 1943 Roosevelt, at Byrnes's request, offered Baruch the chairmanship of the War Production Board, the World War II equivalent of the WIB. When Baruch procrastinated, Roosevelt changed his mind. Later that year Baruch turned down Byrnes's offer of the directorship of the Office of Economic Stabilization. In addition to concern about his age and health, Baruch enjoyed the play of politics behind the scenes.
Yet Baruch did not forgo formal appointments altogether. In 1942 Roosevelt appointed him, along with James B. Conant and Karl T. Compton, to the Rubber Survey Committee to investigate the nation's rubber shortage. In 1943 Byrnes asked Baruch and John M. Hancock, then of Lehman Brothers, to submit a reconversion program. The White House intended to use Baruch's prestige to make difficult political choices more acceptable to Congress. First, the Baruch Committee called for nationwide gasoline rationing, expanded production of synthetic rubber, and appointment of a rubber administrator; Congress approved rationing, and Roosevelt appointed a rubber administrator. Second, the "Baruch-Hancock Report on War and Postwar Adjustment Policies" (Feb. 18, 1944) was intended to head off proponents of public works and government planning in favor of a disposal of surplus property and job creation through private enterprise. Congress established the Surplus Property Administration, and Roosevelt appointed William L. Clayton, a Texas cotton broker, administrator.
By the end of World War II Baruch had become firmly established as an American folk hero. President Harry S. Truman, like Roosevelt before him, attempted to capitalize on the mystique by appointing Baruch ambassador to the United Nations Atomic Energy Commission in 1946. "We will sleep more comfortably in our beds," one newspaper noted, "because clear-eyed Barney Baruch is on guard." The Baruch Plan, presented to the Atomic Energy Commission on June 14, 1946, did guard America's atomic secrets. American production of atomic bombs would cease only after implementation of a system of controls, including full managerial control of manufacturing plants by the World Atomic Authority and a strict limitation on the use of the Security Council veto. Soviet representatives balked at Baruch's insistence that they waive the Security Council veto. Most Americans, however, regarded the Baruch Plan as exceptionally generous. If nothing else, it provided a propaganda victory for the United States and a personal triumph for Baruch.
Baruch's role in atomic diplomacy was his last opportunity to directly influence the nature of major government policy during the Truman administration. Baruch had already differed with Truman. He supported Henry Morgenthau's plan to strip postwar Germany of her industrial base; Truman did not. He lobbied against the administration's postwar loan to a British Labour government that in his view threatened private enterprise. And in the immediate postwar period Baruch recommended a more conciliatory attitude toward the Soviet Union than the administration was prepared to accept.
When the Korean conflict broke out in June 1950, Baruch was far more eager than Truman for all-out economic controls. Left out of the inner circle, he made known his views in public testimony and in private correspondence with influential congressmen such as Carl Vinson, chairman of the House Armed Services Committee, and Lyndon B. Johnson of the Senate's Armed Services Committee. "We face a double threat," Baruch wrote Johnson in the fall of 1950, "one from outside and the other from inside. Wisdom would direct us to arm against a possible invasion, and in doing so to make sure we do not destroy ourselves economically, as we are doing now through the inflationary measures which the government itself is causing." Baruch participated vigorously in the public debate over price and wage controls, and his prestige gave added weight to arguments for tougher measures. But his influence with both the White House and significant congressmen had greatly waned.
Baruch was eighty-three when the Korean conflict ended, and he spent much of his remaining years extending and shaping his public reputation. Impressed with Margaret L. Coit's Pulitzer Prize-winning biography, John C. Calhoun (1950), Baruch suggested that the author do his biography. Mr. Baruch appeared in 1957. Baruch, unhappy with Coit's work, wrote Baruch: My Own Story (1957) and Baruch: The Public Years (1960). Both reveal the enduring impact of Wilson and World War I on Baruch's conception of his country and himself. They also reveal that he self-consciously pursued the heady ambition of having the history of his age recorded through his public career. He died June 20, 1965 in New York City.
text by Robert D. Cuff, Dictionary of American Biography