The answer is: cloth for sheets and other supplies. Reasoning: because of where it says “In particular, the textile mills made most of the fabric used by the armed service, from sheets and blankets to parachutes and tire cords.”
Answer: looking back we always project our present condition on the past. That is an unconscious process. That is why many people at certain age become nostalgic increasingly looking back at "good old days". On a different level this trace of human psychology is perfectly taken advantage of in propagada (especially in the production of historical films). Very good example of that are film of Communist era about medieval era (in such films some medieval figures are frequently depicted as "Communists", whereas some kings or popes are depicted as an example "imperialist bourgeoisie" ).
Explanation: Being 100% objective is impossible. Each individual is onesided and subjective. I do not believe we can expect more from any society. Every society and every political regime is onesided and its view on certain historical events is onesided as well. If there is a freedom of expression this imperfection can be reduced.
