Following World War I, Forrestal returned to Wall Street, and in 1923 Dillon, Read & Company named him a firm partner. In 1937 he became the company's president. In June 1940 President Franklin D. Roosevelt recruited Forrestal as a special assistant. Two months later Roosevelt appointed him undersecretary of the navy. In May 1944 Forrestal became secretary of the navy.
Although Forrestal objected to a proposed postwar army-navy merger, he did support the unification of the armed services championed by President Harry S. Truman. In September 1947, Truman appointed Forrestal secretary of the new Department of Defense, created by the sweeping 1947 National Security Act. Forrestal worked diligently to forge cohesiveness among the armed forces. As an anticommunist hard-liner, however, Forrestal was frustrated by the draconian cuts in military spending in the immediate postwar era. At the time, both Congress and the Truman administration were loath to increase military spending in the face of strained budgets, large war debts, and the U.S. monopoly in atomic weapons.
In 1948 Forrestal was criticized for his inability to stem air force intransigence in the controversy involving manpower needs and budget allocations within the Defense Department. Air force proponents had been beating the drums for more manpower and money at the expense of the other military services. The secretary also fell out of favor because of his pro-Arab views and opposition to the 1948 U.S. recognition of the State of Israel. By late 1948, Forrestal grew increasingly despondent over what he saw as unfair criticism and a lack of congressional and administration support.
As a result of these intense conflicts, his growing fears of the Soviet threat, and his increasingly precarious mental state, Forrestal resigned on 28 March 1949 after suffering what was then termed a mental breakdown. Shortly thereafter he was admitted to the Bethesda Naval Hospital. On 22 May 1949, Forrestal committed suicide by jumping from a sixteenth-story hospital window. Praised for his distinguished service to the U.S. armed forces, he was buried with full military honors at Arlington National Cemetery.
Michael E. Donoghue
Hoopes, Townsend, and Douglas Brinkley. Driven Patriot: The Life and Times of James Forrestal. New York: Knopf, 1992.