A Look Back: FORTUNE’s July 1940 Issue

Allen Saalburg

In July 1940, the fireworks were the deadly kind, bombs bursting in air across Europe and North Africa. Much of the world, though not yet the United States, was at war. Royal Navy battleships bombarded the Vichy government fleet at Mers-el-Kébir in Algeria; while in return, squadrons of French aircraft, based in Morocco, strafed the British island of Gibraltar, and the German Luftwaffe bombed the naval dockyards at Cardiff in Wales and Plymouth, England—a city that, by war’s end, would be pummeled to near rubble. Italian forces crossed from Eritrea to the Sudan, as Hitler’s armies planned for the invasion of Britain.

At FORTUNE, the editors could not help but contemplate the war that the U.S. would join a year and a half later, in December 1941. “Business is better than bombs to form a new world,” read one story deck, “provided we have the bombs and get down to business.”

FORTUNE readers, for their part, were far more resistant to the notion of getting into the war. Just under 8% of them—who were split almost evenly between Republicans and Democrats—said they felt the U.S. should “enter the war at once on the side of the Allies,” according to a special FORTUNE survey, whose results appeared in an insert in the July 1940 issue. Nearly 41% of respondents said the U.S. should help the Allies, but avoid entering the war—with another 19% saying we should come to the Allies’ rescue only if it looked like they were about to lose. (For the record, just 0.2% thought we should help Germany.)

But most of the July issue focused on summer—and on a summery swath of business. The cover illustration by Allen Saalburg, a favorite artist for FORTUNE then, captured painted signs on an old country fence, promoting the Ringling Bros. circus, the nearby state fair, and the election of an unnamed clerk for the fictional Smead County.

Inside, FORTUNE writers marveled at the “new technological world” brought about by E. I. du Pont’s nylon—the silky star of a “textile revolution”—and seemed just as rapturous over General Motors’ liquid-cooled airplane engine, the “Allison,” which had the power of 1,090 horses.

But the issue’s centerpiece story was one of ships, of floating iron richer than gold, filling America’s Great Lakes from shore to shore. Commerce across the lakes, from Duluth, Minnesota, to the St. Lawrence Seaway, was as endless as the tide in 1940—as a staggering 100 million tons of iron ore, coal, grain, scrap, and timber were moved in massive vessels from port to port.

A graphic of commerce across America’s Great Lakes in FORTUNE magazine, July 1940.

“The reason is economy,” said the unnamed author of this fascinating article. “The existence of Lakes commerce can be explained pragmatically by one simple fact: to ship goods by freighter is the cheapest form of industrial transportation known to man. Thus ore cargoes are carried an average distance of 800 miles at a rate of 70 cents per gross ton…To move a ton of ore by rail the same distance would cost around $5.”

In summer, the water-borne traffic on America’s internal oceans was dusk to dawn and onward to dusk. In winter—when “heavy seas and the white hell of ice” made navigation perilous—the ships “huddled like sheep.”

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