The Philosophy of Seizure

May 19, 1952

Where did Washington ever pick up this preposterous notion that the way to prevent or settle industrywide strikes is to seize the property of the victims of the strikes? The idea was not born in the last few weeks. The late “Clear-it-with-Sidney” Hillman told a special committee of the Senate in April 1941, when strikes were crippling our defense plants, that he opposed any legislation that would interfere with unions but would favor government seizure and operation of defense plants closed by strikes. Even prior to this, under Section 9 of the Selective Service Act of 1940, Congress had given the President statutory authority to seize war facilities. Franklin D. Roosevelt began seizing the plants and properties of employers whenever an important strike occurred in them.

In June of 1943, John L. Lewis called a coal strike against a decision of the War Labor Board and offered to call it off only if the government would seize the mines and operate them itself. Then on June 25, 1943. Congress passed the Smith-Connally “antistrike” act, over the President’s veto, which again authorized government seizure of war facilities, but with the restriction that any plant so seized “shall be operated under the terms and conditions of employment which were in effect at the time possession was taken.” One sequel to this was the seizure of Montgomery Ward in April 1944, when President Avery was carried bodily out of the plant.

According to one private score card, President Roosevelt ordered the seizure of four aircraft-manufacturing companies, three shipyards, all the railroads, all the coal mines, several utility companies, dozens of motor-transport companies and more than 150 industrial plants and shops. Of the 48 seizure orders he issued, 41 were to enforce labor demands. The Truman seizures have covered anthracite and bituminous coal mines, oil refineries, pipelines, packinghouses, railroads, and traction systems. And he ordered all of them ostensibly to stop or to prevent strikes. On this excuse the government has been “in possession” of the railroads of the country for 21 months (since Aug. 27. 1950).

What gives the idea of seizure its strange appeal? The legal logic behind it is too confused to follow. Why should it be perfectly all right to bring the steel output of the country to a halt if private investors own the plants, and wrong only if the government “owns” them? Production is just as crippled, and the national safety as much imperiled, in the first case as in the second. The theory seems to assume that government does not exist to protect the property and interests of citizens, but only to protect its own property and interests. You can strike against the public safety but “you can’t strike against the government,” yet even on this rear-end-first theory, seizure rests on a legal technicality, even on a legal fiction. For the government “owns” the property only for the purpose of settling a strike. And the strike is settled, not because workers fear to strike “against the government,” but because the government manager offers the strikers, out of other people’s money, substantially the increase they asked for.

This is the real motive behind the seizure policy. It is the product of a statist and socialist philosophy, it assumes that private employers can’t be depended on to pay “fair” wages, so the government must seize their property and force them to do so—knowing, of course, exactly what “fair” wages are. In the railway strike crisis of 1946, Mr. Truman even went before Congress to propose a measure under which: (1) When a strike occurred in an essential industry the essential industry was to be seized by the government; (2) under such seizure the President was to “establish fair and just wages”; but (3) the property owners were to be denied any profits!

Government seizure abridges property rights, rewards strikers, and penalizes the struck-against. Its real purpose is to impose a government-dictated wage increase. The threat of it is used not to restrain the demands of union leaders but to force employers to grant them. It destroys free collective bargaining. And it creates the very crisis it professes to solve.