In the formative years of the military-industrial complex, the public still deeply distrusted privately owned industrial firms because of the way they had contributed to the Great Depression. Thus, the leading role in the newly emerging relationship was played by the official governmental sector. A deeply popular, charismatic president, FDR sponsored these public-private relationships. They gained further legitimacy because their purpose was to rearm the country, as well as allied nations around the world, against the gathering forces of fascism. The private sector was eager to go along with this largely as a way to regain public trust and disguise its wartime profit-making.

In the late 1930s and early 1940s, Roosevelt's use of public-private "partnerships" to build up the munitions industry, and thereby finally overcome the Great Depression, did not go entirely unchallenged. Although he was himself an implacable enemy of fascism, a few people thought that the president nonetheless was coming close to copying some of its key institutions. The leading Italian philosopher of fascism, the neo-Hegelian Giovanni Gentile, once argued that it should more appropriately be called "corporatism" because it was a merger of state and corporate power. (See Eugene Jarecki's The American Way of War, p. 69.)

Some critics were alarmed early on by the growing symbiotic relationship between government and corporate officials because each simultaneously sheltered and empowered the other, while greatly confusing the separation of powers. Since the activities of a corporation are less amenable to public or congressional scrutiny than those of a public institution, public-private collaborative relationships afford the private sector an added measure of security from such scrutiny. These concerns were ultimately swamped by enthusiasm for the war effort and the postwar era of prosperity that the war produced.