Carroll Quigley - Tragedy and Hope - A History of the World in Our Time

When Germany began the war in September 1939, less than a third of its oil, rubber, and iron ore were of domestic origin; it had only two months’ supply of gasoline at the peacetime rate of consumption and about three months’ supply of aviation fuel. Germany expended less than 100,000 tons of gasoline and oil in Poland and less than 500,000 tons in the conquest of Denmark, Norway, the Low Countries, and France in the period April-June 1940, but captured in the process about two million tons, mostly in France.

At first the British economic warfare against Germany was quantitative rather than qualitative, seeking to reduce the supply of all war materiel rather than concentrating attention, as was done later, on interrupting the supply of a few vital commodities such as ball bearings or aviation fuel. The blockade, with little real effort, was able to cut off immediately over half of Germany’s supply of petroleum products and almost half of its iron ore, but, in general, the blockade was established slowly. There was very poor Anglo-French coordination for the whole period before the fall of France in June 1940, and there was a general agreement not to use aerial bombardment, preemptive buying, export control of enemy products, or rationing of neutral purchases. These special techniques of economic warfare began to be applied only in the spring of 1940, just before they were disrupted by the fall of France.

The early British efforts to control contraband and to obtain a quantitative restriction on German imports placed a burden on the navy which it was unable to bear, particularly because of the demand for naval vessels for convoy duty. In this last respect Britain was very fortunate, for here, also, Germany was woefully unprepared for a major war. In the whole period from the launching of the first German submarine in 1935 to the outbreak of war, the German Navy built only 57 submarines. Only 16 of these were equipped for service in the Atlantic. These were subject to such limitations, especially in regard to their cruising range, that less than ten could be kept in the shipping zone at any one time. British minefields in the English Channel, which destroyed three U-boats immediately, made it necessary for these vessels to go out by the route north of Scotland, with the result that they could not operate, by reason of limited cruising range, farther west than 12° 30’ W. (about 80 miles west of Ireland), so that the British Navy did not have to convoy farther west than this line.

As far as the U-boats were concerned, there was no improvement in this situation until the latter half of 1941. The number of U-boat sinkings reached seven a month, and Germany’s replacement capacity for building these weapons reached 15 a month (compared to 25 a month in the First World War). This production margin made it possible to raise the number of German submarines at sea, by steady steps, from 15 in April 1941 to 60 at the end of the year. This improvement, from the German point of view, was counterbalanced by an improvement in the British antisubmarine defense tactics, as we shall see, but the struggle became so severe that it is deservedly known as the Battle of the Atlantic. Our present concern with this subject lies in the fact that the inadequacy of the German submarine attack in 1939-1941 made it considerably easier for the British Navy to cope with the blockade problem.

In contraband control work, suspicious merchant vessels were forced to put into a control harbor for search of their cargoes. Control points were placed in Canada, in the Mediterranean, in the north of Scotland, and elsewhere, but the United States would not permit one in the Caribbean Sea area. When vessels being detained began to clog up these ports, whole categories of vessels were exempt from control. This applied, for example, to American ships after January 1940. In order to reduce congestion and delay, vessels which certified that they had no contraband and gave detailed reports of their lading were issued commercial passports, called navicerts, by British representatives in their ports of departure and were generally exempt from search or delay. This use of navicerts, voluntary at first, was made compulsory in July 1940. At the same time, the use of British credit, repair facilities, insurance, refueling stations, charts, and all kinds of shipping aids were denied to vessels which did not have a British “ship-warrant.” This system, with the unofficial support of the United States, gradually made it possible to control most of the shipping of the world. The United States and other countries also cooperated from 1940 in rerouting passengers and mails through points like Bermuda or Gibraltar where they could be searched by the British. This gave Britain control of information and enemy funds for blockade purposes.

In order to reduce the enemy’s ability to buy abroad, financial connections were cut, his funds abroad were frozen, and his exports were blocked. The United States cooperated in these efforts as well, freezing the financial assets of various nations as they were conquered by the aggressor Powers and finally the assets of the aggressors themselves in June-July 1941. One of the chief steps in this effort was the interruption of the export of German coal by sea from the Baltic to Italy on March 5, 1940, three months before Italy itself became a belligerent. This disrupted the Italian economy. Efforts to supply only half of Italy’s needs from Germany by rail almost disrupted the German transportation system (since it required the use of 15,000 railroad cars). At the same time, curtailment of Italian exports and the need to buy British coal reduced the Italian gold reserve, almost at once, from 2.3 to 1.3 billion lire.

Because the British Navy lacked ships to enforce any complete control of contraband by stopping vessels for search, various devices were adopted. Beginning in December 1939, agreements were signed with neutrals by which these latter agreed not to reexport their imports to Britain’s enemies. Compulsory rationing of neutral imports was established at the end of July 1940. At the same time, preemptive buying of vital commodities at their source to prevent Germany and its allies from obtaining them began. Because of limited British funds, most of this task of preemptive buying was taken over by the United States, almost completely so by February 1941.

After 1941, the blockade became increasingly effective, especially by the elimination of neutrals (like the Soviet Union, Japan, and the United States) and by the shift from quantitative to qualitative controls. Under this new system the blockade concentrated on a few vital materials and commodities, trying to increase the rate of German usage of these or to reduce their stocks by bombardment or sabotage, and seeking out such materials (like industrial diamonds) at their sources, frequently in remote regions of the earth, then following them by economic-intelligence information to a point where Britain could get them by seizure or by preemptive purchase.

The blockade was enforced by Britain with little regard for international law or for neutral rights, but there was relatively little protest from the neutrals, because the most influential neutrals were already so deeply committed to one side or to the other that they could hardly be regarded as neutrals and were not prepared to defend such a status. The United States openly favored Britain, while Italy and Japan equally openly favored Germany. The Soviet Union favored neither side but was very fearful of attack from both; until April 1940, it was more fearful of Britain and France, while after the fall of Norway and France it became increasingly fearful of Germany. Both of these fears, through geographic and political circumstances, inclined it to a wholehearted economic support of Germany. This continued to the day of the German attack on the Soviet Union on June 22, 1941.