By 1940, only a small committed core remained in the Socialist Party, including a considerable percentage of militant pacifists. The SPA continued to oppose Franklin D. Roosevelt's New Deal as a capitalist palliative, arguing for fundamental change through socialist ownership. In 1940 Norman Thomas was the only presidential candidate who failed to support rearmament military support of Great Britain and China. The pacifist Thomas also served as an active spokesman for the isolationist America First Committee during 1941.
After the Japanese bombing of Pearl Harbor in the fall of 1941, and the declaration of war, however, the U.S. defense of itself and war against fascism was supported by most of the remaining Militants and all of the Old Guard. However, the Socialist Party adopted a compromise position that did not openly oppose American participation in the war. Its failure to support the war created a rift with many leaders, like the Reuther Brothers of the United Auto Workers. The pacifist wing of the party did not advocate engaging in any systematic antiwar activities such as the general strike endorsed by the 1934 Declaration of Principles.
Socialist A. Philip Randolph emerged as one of the most visible spokesmen for African-American civil rights. In 1941, he, Bayard Rustin, and A. J. Muste proposed a march on Washington to protest racial discrimination in war industries and to propose the desegregation of the American Armed forces. The march was cancelled after President of the United States Franklin D. Roosevelt issued Executive Order 8802, or the Fair Employment Act. Roosevelt's order applied to banning discrimination within only the war industries, but not within the armed forces.
But, the Fair Employment Act is generally perceived as a success for African-American labor rights. In 1942, an estimated 18,000 blacks gathered at Madison Square Garden to hear Randolph kick off a campaign against discrimination in the military, in war industries, in government agencies, and in labor unions. Following the act, during the Philadelphia Transit Strike of 1944, the government backed African-American workers' striking to gain positions formerly limited to white employees.
In 1947, Randolph, along with colleague Grant Reynolds, renewed efforts to end discrimination in the armed services, forming the Committee Against Jim Crow in Military Service, later renamed the League for Non-Violent Civil Disobedience. On July 26, 1948, President Harry S. Truman abolished racial segregation in the armed forces through Executive Order 9981.
Thomas led his last presidential campaign in 1948, after which he became a critical supporter of the postwar liberal consensus. The party retained some pockets of local success, in cities such as Milwaukee, Bridgeport, Connecticut, and Reading, Pennsylvania. In New York City, they often ran their own candidates on the Liberal Party line.