MEMORANDUM

paper is thus not a conclusion, its aim is only to give some pointers for the next phase in
Leontief saga, the phase which by his own expression, would “bring up the other wind.” 238
The monograph was exceedingly well documented but had no appeal to the general
reader. It documented an innovation in economic analysis at just the right time in history.
The monograph was not suitable as a textbook. This was reflected in the sales figures
which were dismal compared with those of books by Leontief’s Harvard colleagues. The
delay in the publishing process implying that the book was not published until the
beginning of 1941 detracted from the general academic attention to the book. But at the
same time the demand for what Leontief had to offer was noticed by some of those highly
concerned with the need for better tools for analysis for the mobilization of wartime
resources. This led into the second phase of Leontief’s involvement with input-output
project: the cooperation with the Bureau of Labor Statistics. That story will not be told
here; main features of it can be found in Kohli (2001).
Leontief said in an interview in 1997 that Roosevelt’s Secretary of Labor, Frances
Perkins, the first woman to be appointed to the Presidential Cabinet, had written to him that
the President had asked what would happen to the American economy after the war. 239
Perkins had in 1933 appointed Isador Lubin as Commissioner of Labor Statistics. Lubin
had succeeded in upgrading and expanding the Bureau of Labor Statistics (BLS) to become
a professionally-staffed institution with considerable analytic capacity. In April 1941,
while Leontief was still on sabbatical in Mexico, Congress invited to Lubin (bypassing
other agencies) to set up a Defense Problems Unit to study the problems the United States
would have to address to resume normal economic operations after the war. As this was
before Pearl Harbor USA was not at war but the building up of the defense had been going
on for some time and would clearly demand more resources, and much more if USA was
drawn into the war.
Lubin accepted and left it to one of his Chief Lieutenants, Donald Davenport, to
establish a division right away. It was called the Defense Labor Problems Division.
Davenport had come to BLS from Harvard but had never met Leontief at Harvard but was
aware of his work. The division studied Leontief’s work but was uncertain how to make
use of it for their assignment. It was obvious that a new input-output table was needed
based on the 1939 Census. Leontief and BLS worked out that this could be done by setting
up a unit at the Littauer Center, manned by BLS, and directed by Leontief.
The acting head of BLS, Dal Hitchcock, cabled Leontief on 5 December 1941 to
request an appointment at Harvard on the afternoon of 11 December to confer on the
238 «The input-output analysis represents an attempt to straighten out our line of advance by
bringing up the other wing – the study of interindustrial relationships.» Leontief (1951, p.204).
239 See Foley 1998, p.122. It is not when the letter was written.
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