In 1934, when William H. Woodin resigned because of poor health, Roosevelt appointed Morgenthau Secretary of Treasury; even conservatives approved.¹https://archive.org/details/frommorgenthaudi0000blum pg. 74 Morgenthau was a strict monetarist. President Roosevelt, Morgenthau, and Federal Reserve Chairman Marriner Stoddard Eccles jointly kept interest rates low during the depression to finance massive public spending, and then later to support rearmament, support for Britain, and U.S. participation in WWII.²https://mises.org/library/origins-federal-reserve-2³https://web.archive.org/web/20091229174605/http://www.minneapolisfed.org/community_education/student/centralbankhistory/⁴https://www.independent.co.uk/arts-entertainment/obituary-william-mcchesney-martin-1172986.html

Morgenthau used his position as Treasury chief to investigate organized crime and government corruption. Treasury Intelligence and other agencies were uncoordinated in their efforts; efforts to create a super-agency were stalled by J. Edgar Hoover, who feared his FBI would be overshadowed. Nevertheless, Morgenthau created a coordinator for the Treasury agencies; although the coordinator could not control them, he could move them to some cooperation.

Morgenthau believed in balanced budgets, stable currency, deduction of the national debt, and the need for more private investment. The Wagner Act regarding labor unions met Morgenthau’s requirement, because it strengthened the party’s political base and involved no new spending.  Morgenthau accepted Roosevelt’s double budget as legitimate, a balanced regular budget, and an “emergency” budget for agencies (ie. Works Progress Administration / Public Works Administration / Civilian Conservation Corps) that would be temporary until full recovery was at hand.

In the 1920s and 1930s, Baruch expressed his concern that the United States needed to be prepared for the possibility of another world war. He wanted a more powerful version of the War Industries Board, which he saw as the only way to ensure maximum coordination between civilian business and military needs.¹Leab, Daniel et al., ed. The Great Depression and the New Deal: A Thematic Encyclopedia ABC-CLIO Inc., 2010, p. 11. Baruch remained a prominent government adviser during this time, and supported Franklin D. Roosevelt’s domestic and foreign policy initiatives after his election.

When the United States entered World War II, Baruch supported what was known as a “work or fight” bill. He advocated the creation of permanent superagency similar to his old Industries Board. His theory enhanced the role of civilian businessmen and industrialists in determining what was needed and who would produce it. Baruch’s ideas were largely adopted, with James Byrnes appointed to carry them out. It is estimated that these policies cut two years off the time taken to produce tanks, bombers, etc. and caught Hitler totally by surprise.

In February 1943, Roosevelt invited Baruch to replace the widely criticized War Production Board head Donald M. Nelson. Baruch had long coveted the job, and responded that he only needed to ask his doctor if he was healthy enough for the post. During the delay, however, presidential advisor Harry Hopkins persuaded Roosevelt that firing Nelson at the army’s demands would make him look weak, and when Roosevelt and Baruch met at the White House, Roosevelt declined to discuss the job offer further.²https://books.google.com/books?id=wQcMDdFC1QEC&q=doris+goodwin+eleanor#v=snippet&q=doris%20goodwin%20eleanor&f=false pp. 411–412³Herman, Arthur. Freedom’s Forge: How American Business Produced Victory in World War II, pp. 12-13, 247, Random House, New York, NY. ISBN 978-1-4000-6964-4.