Yesteryear is filled with those whose names today mean nothing to most, but in their day were lightning rods. Leon Henderson is one of those people.
Henderson became a member of Franklin Roosevelt’s inner circle, perhaps the result of his 1937 memorandum “Boom and Bust” written when he was Director of Research and Planning with the National Recovery Administration. Roosevelt appointed him to the Securities and Exchange Commission in 1939, and in 1941 to head the Office of Price Administration. John Kenneth Galbraith, a historically important economist, public official, and diplomat, begins Chapter 8, “Washington, 1940,” of his autobiography A Life in Our Times: Memoirs (Houghton Mifflin Company, 1981):
Leon Henderson was slightly under average height, of rather more than average width, and he seemed always to be adjusting his pants, pulling a little on his belt as though this would reduce his waistline. Perhaps because they had to be so large at his stomach, his trousers were always very loose below. They flopped when he walked or the wind blew. The rest of Leon’s attire was somewhat more disorderly. He shaved regularly but without precision. His face altered between an expression of unconvincing belligerence and one of shocked, unbelieving innocence, and sometimes he affected both at the same time. Mostly, however, he favored the belligerent expression, and this he sought to reinforce with a sharply jutting cigar that he rolled in his mouth but rarely smoked. He was highly intelligent, with a strong retentive mind. After a few minutes’ study of a paper on any subject, however complex, he not only had absorbed it for all needed use but could give convincingly the impression that he had written it himself.
It was during 1940 that Galbraith would become Henderson’s deputy when he served on Roosevelt’s National Defense Advisory Commission. Among those serving on the commission with Henderson was Harriet Elliot, Dean of Women at the Woman’s College of the University of North Carolina (now UNC Greensboro).
Galbraith devotes many pages of his first-hand accounts surrounding Henderson and his role in determining American economic policies during the critically important years from the mid 1930s into the first year of the United States’ direct involvement in the second World War. Galbraith attributes Henderson as the person “who first voiced the thought that having a little inflation was like being a little pregnant” during “the almost paranoiac concern of 1940 and 1941 over inflation.”
Word that Leon Henderson would visit the University of North Carolina at Chapel Hill first appeared in The Daily Tar Heel on April 5, 1942. Ridley Whitaker, chair of the Carolina Political Union, a non-partisan and non-political student group formed in 1936, announced that three important men had been sign to speak during the week of April 23:
- William H. Davis, chairman of the National War Labor Board formed on January 12, 1942;
- Leon Henderson, head of the Office of Price Administration, which had become an independent agency on January 30 under the Emergency Price Control Act; and
- “head of the Senate’s much-renowned Truman committee, Mississippi Democrat Harry S. Truman” [sic, Truman was from Missouri].
Whitaker noted that past invited speakers had been “reluctant to talk,” but that these men would. “We’re having those men down to talk. They were signed with that purpose. Henderson has already wired that he’s coming here because he wants someone to argue with him.” Harriet Elliot would introduce Henderson.
The Daily Tar Heel reporter Paul Komisaruk, who covered the Henderson story during the next two weeks, describe Henderson as “More colorful than Davis” and “clearly one of ‘America’s New Bosses,’ who with his control of prices profoundly influences the cost of living in every home in America.” Komisaruk was not exaggerating, and he attributes Henderson’s “Boom or Bust” [sic] memorandum to Henderson’s rise to Roosevelt’s “inner-brain trust.”
Within a week, Komisaruk reported that Henderson’s visit would be moved up to April 15, a date which also marked the sixth anniversary of the Carolina Political Union. Henderson’s “pressing duties in Washington” necessitated the change. Komisaruk wrote, “Holding down the most difficult and delicate job in Washington, the quick-tempered Henderson will explain to students and visiting dignitaries, the Congressional battles over price-fixing that rocked the halls of Congress, and still, to develop into the biggest domestic issue of the war.” He also reported that Whitaker had developed the evening’s program to include a banquet and a reception, and that attendees would include Governor J. Melville Broughton and Josephus Daniels, who had been the United States Ambassador to Mexico from April 1933 until November 1941 and who was at that time the editor of his family-controlled newspaper The News and Observer in Raleigh.
On the day prior to Henderson’s visit, The Daily Tar Heel editorial staff column included a segment titled “A Man Who Knows . . .” in which the editors wrote, “This is the man who can tell you why Lenoir Hall prices are going up and when they will stop. He doesn’t speak with an accent and he can’t sing the praises of the fighting soldiers, but he can tell you the effect of the war effort on the consumer.”
On the day of Henderson’s trip to Chapel Hill, Kamisaruk noted that Henderson was departing Washington “in the midst of a growing storm over issues pertaining to setting a ceiling on labor’s wages.” He expected Henderson “to explain the stand he took last week before the War Labor Board, when he warned that a ceiling must be set or the country will be faced with ‘devastating inflation,’ that may cause the US to lose the war.” Kamisaruk also noted that “political observers” say that “Henderson’s warnings about inflation and frozen wages are not to be taken lightly despite the violent recriminations they have brought from labor leaders throughout the country. They point to the depression of 1937 that Henderson anticipated and warned about, and was ridiculed for until the ‘Henderson depression’ came right along as he said it would.” Kamisaruk concluded with an unattributed quotation: “his idealism springs out of the soil of harsh facts. And the harshest of these facts are prices, prices, prices.”
An example of opposition to Henderson can be seen in Ray Tucker’s syndicated column “National Whirligig” for April 15. In a section he titled “Sleuths” Tucker noted that since February 17, 1941 when the “first move to regulate the main factors underlying our artificial war economy,” Henderson had “issued one hundred and six permanent rulings and fifteen temporary decrees.” Tucker took exception to these, noting that “the rapidity with which prohibitions have had to be extended into the retail field is what reflects graphically the failure of the present philosophy.” According to Tucker, between March 1941 to March 1942, wholesale costs had risen nineteen percent and living costs twelve percent. Tucker feared the installation of a “more drastic regime will flood the country with a locustlike army of regulators and sleuths,” concluding “But this condition appears to be a necessary touch of totalitarianism.”
Komisaruk’s coverage of Henderson’s evening on campus noted that he delivered only “perfunctory remarks, and promptly announced that the floor was open to discussion.” Henderson had indeed come to Chapel Hill to argue. “Spectators fired a barrage of questions,” one of which concerned the forty-hour work week. The Associated Press picked up this nugget, as printed in The Burlington Times. The AP noted that Henderson believed suspension of the 40-hour week would decrease production because, “I don’t believe human beings will respond a 10 per cent cut.” He also said the nation might be forced to adopt a general sales tax, which he did not favor, unless wages were stabilized.
The Daily Tar Heel also reported that a Henderson answer to one questioner “drew roars of laughter” when asked for “a few words about that ‘great American patriot Martin Dies.'” (Martin Dies Jr. was a co-creator and chairman of the House Committee Investigating Un-American Activities.) Henderson replied, “. . . it always happens once an evening—a question the speaker can not answer glibly. I can only repeat what I have said on other occasions. ‘I will eat on the steps of the Treasury building at high noon any organizations I have belonged to that Martin Dies proves is subversive.” He added with a smile, “Of course there are some high school groups I belong to that his flat-feet haven’t gotten around to inspecting yet.”
A few days after Henderson’s evening in Chapel Hill, The Daily Tar Heel opinion column noted that “Memorial hall overflowed . . . for the CPU’s first speech of the spring quarter. There were many who expressed disappointment at Mr. Henderson’s speech and then there were those who felt it to be the first speech of the year during which you had to think to be able to understand what was being said. Regardless of what opinions are being batted around campus, Leon Henderson’s address goes down as one of the meatiest of the year.”
Henderson’s story looms larger than A View to Hugh can tackle. In short, the midterm elections of 1942 saw Democrats lose nine seats in the United States Senate and forty-three in the House of Representatives. Democrats still maintained a significant majority, but it was the smallest since Roosevelt’s first election a decade earlier. In V was for Victory: Politics and American Culture During World War II, author John Morton Blum cites a survey taken of “Democratic Senatorial and Congressional candidates, whether they were victorious or not” by Edwin W. Pawley, then Secretary of the Democratic National Committee. Blum describes the polling as “probably the shrewdest and most self-interested postelection [sic] analysis that Roosevelt received.” Pawley reviewed the replies and compiled a list of five factors that contributed to the Democratic Party losses. Number three on the list was “Resentment of O.P.A. Particularly of Mr. Henderson. This was the most universal and serious complaint of all . . . It appears from the letters that the complaint is directed rather at Mr. Henderson and his attitude and methods than at the abstract question of . . . rationing and price control . . . .” Pawley suggested the complaints against Henderson were “correctable” and Blum states that “Roosevelt got the message.”
In December 1942 Henderson called Galbraith and others to his office where they learned of Henderson’s intention to resign. He stated that his health, and particularly his eyesight, would not permit him to continue. Henderson didn’t expect anyone to believe that, so he kept repeating it “with increasing emphasis and indignation. In fact he was persuaded that there would be ever more severe attacks on our front and that he could blunt them by removing himself from the scene.”
Looking back, Galbraith believed Henderson was “never completely happy again” and that “the debt owed to Henderson for preparing the civilian economy for World War II has never been even partially recognized. Had it not been for his bold, intelligent actions and those he authorized, civilians would have suffered. And so assuredly would those who did the fighting.”
CORRECTION: This post was edited on 17 April 2017. In the opening quote from Galbraith, the word tentative was changed to retentive.