In August 1914 most Europeans greeted the outbreak of hostilities enthusiastically, believing their own nation was in the right and defending itself from aggression. Yet by mid-
The change came through national unity governments that began to plan and control economic and social life in order to wage total war. Governments imposed rationing, price and wage controls, and even restrictions on workers’ freedom of movement. These total-
Germany went furthest in developing a planned economy to wage total war. Soon after war began, the Jewish industrialist Walter Rathenau convinced the German government to set up the War Raw Materials Board to ration and distribute raw materials. Under Rathenau’s direction, every useful material from foreign oil to barnyard manure was inventoried and rationed. Food was also rationed. Moreover, the board successfully produced substitutes, such as synthetic rubber and synthetic nitrates, for scarce war supplies. Following the terrible Battles of Verdun and the Somme in 1916, military leaders forced the Reichstag to accept the Auxiliary Service Law, which required all males between seventeen and sixty to work only at jobs considered critical to the war effort. Women also worked in war factories, mines, and steel mills.
As mature liberal democracies, France, Great Britain, and the United States were much less authoritarian in August 1914 than autocratic Russia, Germany, and Austria-
In June 1915, for example, a serious shortage of shells led the British to establish a Ministry of Munitions that organized private industry for war production, controlled profits, allocated labor, fixed wage rates, and settled labor disputes. By December 1916 the state largely directed, planned, and regulated the British economy. The Espionage Act of June 1917 and the Sedition Act of May 1918 allowed the United States government to keep groups like labor unions, political parties, and ethnic organizations under surveillance. Welfare systems were also adopted in most belligerent countries. Many of these laws were revoked at war’s end. Still, they set precedents and were turned to again during the economic depressions of the 1920s and 1930s and World War II.