Painting Ourselves In

September 7, 1959

The labor laws and administrative and court decisions of the last 27 years have finally produced a situation where there seems no way of settling a strike except by forcing employers to give in to each succeeding union demand for higher wages or fringe benefits.

One reason Presidents have been slow to resort to the injunction provisions of the Taft-Hartley Act is that they have recognized that such a step does not assure any solution. People do not cool off during the 80-day “cooling off” period. If negotiations got nowhere in all the weeks before the strike, there is little more reason to expect them to succeed during the 80 days. And union leaders, like David J. McDonald, have a plausible excuse for calling the forced return to work a “slave labor” device.

Recognition of the weaknesses of the “cooling off” period brings pressure for compulsory arbitration, under whatever thin disguise. One such disguise is government “fact-finding.” But the fact-finding report recently made public by Secretary Mitchell, though as full and impartial as could reasonably be desired, merely served to emphasize the truth of the President’s earlier remark that the “facts” in the steel strike were already pretty well known. Each party emphasizes the particular facts or interpretations that serve its case.

FACTS THAT STAND OUT

The facts most likely to impress the public are that hourly earnings of the steelworkers have increased 85 percent since January 1950, and were $3.10 an hour just before the strike compared with $2.23 in manufacturing as a whole. Any further increase in steel wages, even apart from its effect on steel prices, would be certain to provoke a new round of demands for wage increases by other workers determined to catch up.

Contrary to a widely held opinion, “fact-finding” does not unerringly indicate what the “right” settlement of a wage dispute should be. There is no scientific formula by which we can determine a “correct” price or a “just” wage. In a free economy, prices and wages are determined by supply and demand. Competition and comparative incentives determine particular wages, prices, and cost-price relationships. It is failure to recognize this that brings political pressures for compulsory arbitration. This would lead directly into government wage-and price-fixing, throw every wage and price into politics, and finally produce the suffocating controls of a totalitarian economy.

The injunction provisions of the Taft-Hartley Act were an attempt find a substitute for the rights taken away from employers and non-strikers by the Norris- LaGuardia Act of 1932. That act denies injunctive relief to persons suffering irreparable injury from unlawful conduct. By it the government has abandoned its first duty—that of preventing private coercion.

TOLERATING COERCION

That the performance of this duty would be the first step toward halting the wage spiral and solving the labor problem is beginning to be recognized. As Edward H. Chamberlin, the Harvard economist, wrote in the June Atlantic Monthly:

“The threat of potential violence and intimidation through the device of the picket line are powerful factors—so powerful, in fact, that nowadays a firm rarely attempts any operations at all if a strike has been called, although it would be within its legal rights to do so. For all practical purposes the alternative of making a bargain with anyone other than the union has been removed. . . . Should a union be allowed to strangle a business economically by arranging with the teamsters to cut off its transportation? It seems to me we might as well ask if a physically strong customer in a retail shop should be allowed to twist the arm of a shopkeeper in order to drive a better bargain with him.”

The right to strike is too often interpreted as the right to win a strike. But if it is unthinkable that any strike should be broken, if no strike is to be lost, then every strike must be won. The tolerance of mass picketing gives enormous incentive to irresponsible strike-calling and to the wage-price spiral. Until our lawmakers face the implications of this, the labor problem will grow.