Lend Lease Program
(March 11, 1941)
In December 1941,
President Roosevelt received a letter from Winston Churchill, the leader
of Great Britain, stating that by June of that year England would no
longer be able to pay for the supplies and arms the United States had
been providing in the battle against Germany. In 1934,
the Johnson Debt-Default Act had forbade the United States from trading
with any warring nation except on cash terms. If England was to survive,
a way around the Johnson Act had to be found.
Roosevelt devised a plan where the necessary supplies and equipment
could be lent and leased to England. Using the analogy of lending a
neighbor your garden hose if his house was on fire and thereby keeping
the fire from spreading to your own house, he gained support for the
concept. The Lend Lease bill (H.R. 1776) gave the president broad powers
to "sell, transfer title to, exchange, lease, lend or otherwise
dispose of" items to other countries if he decided they were not
vital to national security. In so doing the United State became, as
Roosevelt stated, "the great arsenal of democracy."
At its peak the Lend Lease program assisted 38 countries and made $48
billion available. England received the largest share. After the war
most of the debts were cancelled. Only about $8 billion was ever actually
repaid and most of that came from England and France. The Soviet Union
foreshadowed its Cold War hostility towards the United States by refusing
to repay its portion
Sources: FDR
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