Creating a democratically run economy: lessons from World War II price control struggles*

Many activists in the United States are working to build a movement for a Green New Deal transformation of the economy.  Not surprisingly, a growing number look to the World War II conversion of the US economy from civilian to military production for inspiration and policy ideas.  The conversion experience shows that a rapid, system-wide transformation of the U.S. economy is indeed possible. It also demonstrates that state capacities and action are critical; the successful conversion required state planning, public financing and ownership, and state direction of economic activity.  At the same time, with very few exceptions, the conversion process was structured in ways that minimized any serious challenge to existing class relations.¹ 

One of the most important exceptions was the government’s approach to price stability.  Faced with business determination to boost its prices and profits, and worker willingness to strike to maintain their real income, the Office of Price Administration was eventually forced to “deputize” volunteers to administer and ensure compliance with its system of price control.  Tens of thousands of volunteers were authorized to visit retail locations to monitor business compliance with the controls and tens of thousands of additional volunteers served on price boards that were empowered to investigate and fine retailers who were found to be in violation of the controls.