Hattie Blue Sky takes place in 1918 against the backdrop of the First World War. During this time, there was a good deal of anti-German animosity in the United States, which manifested itself in various ways; some of them ludicrous (renaming sauerkraut "liberty cabbage"), others much more sinister (attacks on the homes and businesses of Germans and German Americans).
One such sinister act of criminality occurs in the story when the Muellers, a family of German descent, have their barn burned down by locals who've formed themselves into an organization called the Dawson County Council of Defense. This shadowy group has taken it upon itself to root out anyone it suspects of subversive activity. Many members of the local community have sons in the U.S. Army risking their lives in France, and they are particularly hostile towards anything vaguely German. They form the backbone of support for the Council of Defense.
The United States is supposed to be fighting to make the world safe for democracy, yet here at home a group of thugs, who fancy themselves as super-patriots, are actually undermining the cause by their criminal activities. The leader of this group, one Traft Martin, could've served at the front but got out of army service because his mom pulled strings with the Governor to get him appointed head of the Council of Defense. In so many different ways, then, he's doing absolutely nothing to advance the American war effort.