484254
research-article2013
LSJ37410.1177/0160449X13484254Labor Studies JournalBurns
Interactive Issue
Labor’s Economic Weapons:
Learning from Labor History
Labor Studies Journal
37(4) 337­–344
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DOI: 10.1177/0160449X13484254
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Joe Burns
This article argues that trade unionism has deviated from fundamentals of trade union
economics. For the first 150 years of trade unionism in the United States, union strategy centered on two objectives: (1) standardizing wages across entire labor and/or
product markets and (2) developing a strike capable of halting production or otherwise
impacting the operations of the employers. Charles Craypo, in the 1980s textbook The
Economics of Collective Bargaining, summarized traditional union understanding:
“Union ability to make an employer pay higher labor costs depends essentially on two
factors—the extent of worker organization and the ability to stop production” (Craypo
1986, 226).
In doing so, trade unionists developed a form of unionism that swept aside market
considerations to provide a better life for millions of working-class Americans. Jobs in
industries such as auto, meatpacking, mining, and steel became tickets to the better life
in the 1950s. This form of unionism self-consciously rejected the idea that the sale of
human labor should be simply considered another commodity.
However, changes in U.S. labor law, as a result of both legislation and court decisions, undermined union ability to utilize these essential tools of industry-wide action
and stopping production. As a result, modern trade union activity looks very little like
traditional trade unionism. Rather, it represents a management-inspired version of
unionism in which the price of human labor is primarily determined by market forces.
More important than unfavorable labor law, however, is the change in union consciousness in the past several decades. Unlike traditional trade unionists who insisted
on a right to a meaningful strike and buckled against legal restrictions, today’s labor
movement has largely abandoned the strike.
The Necessity of Wage Standardization
According to labor economist Bruce Kaufman, traditional trade unionists and labor
economists long understood that “if unions can organize all competing firms, they can
use collective bargaining to establish uniform labor costs across the industry . . . and
Corresponding Author:
Joe Burns, 5039 Nokomis Ave S, Minneapolis, MN 55417, USA.
Email: [email protected]
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thus take wages out of competition” (Kaufman 2008, 61). The reason is simple economics. Unless unions are able to standardize wages in an industry, unionized firms
will be constantly undercut by nonunion competitors.
For that reason, employer resistance to unionism historically has intensified when
there is significant inequality in wages between workers at different employers.
Historian Philip Taft recounted employer complaints against the union of iron molders
in the 1860s for failing to organize the entire industry noting: “One of the sources of
differences between the employers and the union was the failure of the union to raise
prices in the eastern shops so as to equalize costs between eastern and western producers” (Taft 1964, 183). Then, as now, unions that organized only part of an industry
suffered the consequences.
The very reason trade unionists came together in regional and national trade unions
was to standardize wages in an emerging national market. Historian John Commons,
writing in the early 1900s, noted, “In the field of trade unionism the nationalization of
the market gave birth to the national trade union” (Commons 1918, 43). As an example, Commons noted that in the 1860s, stove molders began producing in competing
markets. “In order that union conditions should be maintained even in the best organized centers, it then became imperatively necessary to equalize competitive conditions in the various localities. That led to a well-knit national organization to control
working conditions, trade rules and strikes” (Commons 1918, 44).
As historian Lloyd Ulman, writing in the 1950s, revealed in painstaking detail in
The Rise of the National Trade Union, the internal development of unions was very
much guided by an effort to contend with changing labor and product markets (Ulman
1955). Ulman, a protégé of John Commons, analyzed the development of intricate
work rules, the development of national strike funds and rules, and the fixation on
jurisdiction that motivated craft unions in the period from the 1860s through the 1920s.
To Ulman, rather than irrational rules, these rules represented attempts to contend with
shifting labor and product markets.
Just as standardizing wages was a fixation of the craft unions of the early 1900s, the
industrial unionists of the post–World War II period understood the importance of
maintaining union standards. Backed by a powerful strike, unions established regional
or nationwide agreements covering hundreds of thousands of workers in steel, mining,
meatpacking, and trucking. Thus, for example, by the mid-1960s, the National Master
Freight Agreement provided half a million truckers a standard union contract. In other
industries, such as auto, unions used pattern bargaining to produce the same results,
with the union negotiating an agreement at one automaker and then forcing the other
companies to follow suit.
During the 1950s, conservative commentators frequently attacked unions as constituting monopolies of labor. Although strictly speaking this was not true—unionists
never monopolized the supply of unskilled or semiskilled labor, conservatives correctly hit on a crucial point. Unionists of the 1950s were able to set wage standards for
entire industries far above what pure market economics would dictate. They were able
to remove the setting of wage standards from the market. In doing so, unionists relied
on a powerful production-halting strike.
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The Production-Halting Strike
For the first 150 years of trade unionism in the United States, the centerpiece of trade
union activity was a powerful strike. The strike was the means to win union recognition, the weapon giving meaning to collective bargaining, and a key element in forcing
wage standardization on reluctant employers. The strike was, as declared by economist Albert Rees in 1962, “by far the most important source of union power” (Rees
1962, 31).
To be successful, however, traditional trade unionists understood that a strike
needed to affect the operations of the employer. Merely putting up ineffectual
picket lines and watching scabs go in and products come out put little pressure on
an employer. Union strategy, for that reason, was calculated to stop the production
of the employer. As described in a labor relations textbook of the period, The
Practice of Collective Bargaining, a strike “denies the employer the use of a productive plant until it is ransomed by a satisfactory settlement” (Begin and Beal
1985, 228).
During the 1800s, skilled trades workers could stop production simply by withdrawing their labor. Union strategy during this period fixated on how to limit the supply of labor. With the development of national labor markets and the deskilling of
labor, this form of strike activity became relatively ineffective. To organize the masses
of industrial workers not covered by the trade union movement, unions needed new
forms of strike activity.
As economists James Robinson and Roger Walker explained in Labor Economics
and Labor Relations, tactics capable of stopping production were necessary to organize industrial unions in the 1930s:
Frequently because no alternative sources of skilled labor existed, the craft union did not
even have to picket the struck employer. By contrast, many industrial unions were engaged
in organizing workers who possessed little or no identifiable skill. As a result some technique
had to be developed to effectively stop employers from replacing striking workers with
unemployed laborers who were also unskilled. . . . However, particularly in the early days of
the CIO, local law enforcement authorities frequently were prepared to support employer
efforts to smash picket lines. Thus, the strike weapon often was simply not effective. The
sit-down strike carried conventional strike activity one step further. (Robinson and Walker
1973, 172–73)
Following the success of the UAW sit-down strike in Flint, use of the tactic exploded.
In 1937 alone, 400,000 workers participated in sit-down strikes (Hansen 2000).
Despite unemployment in double digits, trade unionists were able to win union recognition and form the modern labor movement.
The idea that a strike needed to stop production was mainstream union understanding during the period of the 1930s through the 1970s. Looking through labor relations
textbooks of the period, one finds a consensus that the point of a picket line is to stop
the production of an employer. Some sample quotes illustrate the point:
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The immediate strike objective of the industrial union in manufacturing is to control physical
access to the workplace. This denies the employer the use of a productive plant until it is
ransomed by a satisfactory settlement. . . . The underlying strategy in all of them is to prevent
the replacement of strikers of many varieties and degrees of semiskill by other individuals
who can be taught strikers’ jobs. (Begin and Beal 1985, 228)
Picketing the plant is not a siege, it is a blockade. It cuts the plant off from a vital element
of production: labor. It defends the approaches to the plant against the entrance of people
who might provide the labor. Who are these people who might want to go in the open
gate? Anybody and everybody, including union members who weaken. (Begin and Beal
1985, 232)
The objective of any strike, of course, is to halt the employer’s operation, thus causing a loss
to him that he may come to recognize as being greater than the benefit of resisting the
union’s demands. (Helfgott 1980, 173)
While such understandings were commonplace in the labor movement, by the 1980s
the idea the unions needed to stop production during a strike became isolated to the
fringes of the labor movement. With the management offensive against collective bargaining in the 1980s, employers used their rights under the legal system to mount an
effective counteroffensive against unionism.
The Triumph of Market-Driven Collective Bargaining
Employers have always opposed the right to strike in the United States. After the passage of the National Labor Relations Act (NLRA) in 1935, employers generally
refused to follow the act in a campaign of employer lawlessness. A worker strike wave
forced a reluctant Supreme Court to uphold the NLRA in 1937 in National Labor
Relations Board v. Jones & Laughlin Steel Corporation (1937). While the NLRA
became the law of the land, employers used their influence in the courts and Congress
to undermine the act. They were able to use their influence in Congress and the courts
to transform the NLRA, which legal scholar Karl Klare described as “perhaps the most
radical piece of legislation ever enacted by the United State Congress” into an increasingly rigid system of labor law that contradicted these key union objectives (Klare
1977–78, 278).
In doing so, employers were able to transform the NLRA into a system of labor
control that forced collective bargaining to operate largely within the constraints of
market economics and, thus, largely frustrated the very purpose of unionization. The
tactics that made possible the modern labor movement, the sit-down strikes and mass
picketing, became unprotected activity under the National Labor Relations Act (Pope
2004, 521; also see Atleson 1983). Without those tactics, the strike eventually became
wholly ineffectual, unable to raise wages above free market rates.
Under the Mackay Radio doctrine (1938) employers were allowed to permanently
replace striking workers. In a 1990 law review article, Mathew Finkin showed how
following up on the Mackay Radio decision, successive Supreme Court decisions
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closed off tactics the union could use against scabs. The end result, according to
Finkin, was that “in the face of an impending strike, the employer may announce a
decision to permanently replace strikers, to offer advantageous treatment to crossovers, and to give preference to replacements and cross-overs over un-reinstated
strikers in any recall after a later lay-off. After the strike is commenced, the employer
may issue an ultimatum to return to work or face permanent replacement; indeed,
such is a recommended practice” (Finkin 1990, 567). Finkin concluded that “as a
result, resort to the statutory ‘right’ to strike would be, for many employees, an exercise in permanent job loss, and, for the union, an act of potential self-immolation”
(Finkin 1990, 567).
The key question we face as a labor movement is whether tactics capable of stopping production are essential elements of trade unionism. To express it otherwise, is
there a basis for industrial unionism, or even most craft unionism, without a strike that
stops production? As a matter of economics, it is simply not possible to raise wage
rates above free market conditions without interfering with the marketplace. According
to Richard Posner, the prominent right-wing federal judge and a leader of the conservative law and economics trend, “The large number of potential competitors of the
striking workers is such a large obstacle to cartelizing labor markets” that unions
would be unable to do so “provided the government enforced against unions as against
the rest of society the basic laws protecting rights of property, contract, and personal
safety (so that unions could not use force or the threat of force to achieve their ends)”
(Posner 1984, 1003).
That’s why developing strike tactics capable of forcing wages above free market
conditions is the central question facing U.S. trade unionism. As law professor James
Pope explains, “The treatment of labor as a commodity subject to the rules of the marketplace is a defining feature of capitalism. The claim of a constitutional right to
strike—a right to interdict the free competition of individuals in the buying and selling
of labor power—obviously imperiled the ideology and practice of commodity labor.
The right to strike could not be justified without addressing the question of labor liberty per se” (Pope 1997, 943).
The other key objective of traditional trade union economics, the ability to standardize wages in an industry, was also thwarted. Without standardizing wages, even
where unions are able to successfully bargain higher than free market rates, unionized
firms will be eventually undercut by lower wage competitors.
The very structure of the National Labor Relations Act eliminates the solidarity
and wage standardization that were at the heart of traditional trade unionism.
According to professor Christopher Tomlins, during the 1930s AFL craft unions
worried that passage of the NLRA could “result in the creation of a weak and atomized labor movement consisting of thousands of uncoordinated groups. [AFL
President] William Green voiced that concern in 1934: ‘elections in individual
plants supported by the National Labor Board should not be confused with real collective bargaining. . . . In the long run we must look to independent organizations
of workers on a national or international basis for real collective bargaining’”
(Tomlins 1985, 124–25).
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The problem AFL unionists correctly identified was that the NLRA left the decision
to organize and collectively bargain to be decided by employees of a given firm. Thus
if workers at a given plant chose to not unionize (or unionize but negotiate an inferior
contract), other unionized firms in the industry would be undercut. In contrast, the
traditional AFL approach was that the unions as institutions were able to set wage
standards for entire industries, with those who undercut those standards considered
scab outfits. By making unionization a subject of government-supervised elections,
employers and the government were able to intrude into core union areas, such as
when a union was formed at a firm. As prominent labor history David Brody argues,
“The representation election is the instrument by which labor’s enemies have hijacked
the law” (Brody 2004).
Subsequent amendments to the NLRA, the Taft-Hartley Act of 1947 (outlawing
secondary strikes and boycotts) and the Landrum Griffin Act of 1959 (banning hot
cargo provisions), further eroded union ability to standardize wages in an industry.
Trade unionists denounced Taft-Hartley as the “Slave Labor Act,” and its passage
was heralded as tantamount to the destruction of the labor movement. According to
Nelson Lichtenstein, AFL leader George Meany opposed the legislation because
“the Taft-Hartley Act's restrictions upon trade union use of the boycott, as well as its
more general efforts to limit the spread of unionization, made more difficult the
equalization of wages and conditions among competing firms within the same industry. Meany anticipated that labor costs would therefore be at issue, pitting worker
against worker in a downward spiral that transformed human labor into a mere commodity and workers into chattels” (Lichtenstein 1998, 767). As a result, when the
employers launched their offensive against trade unionism in the 1980s, the nationwide multiemployer agreements covering hundreds of thousands of workers crumbled in a race to the bottom. Without the tools of solidarity, and with a legal system
constructed to confine bargaining and striking to single enterprises, unions were
unable to resist the downward trend.
The Abandonment of the Strike
and the Decline of the Modern Labor Movement
Today’s labor movement has largely abandoned the strike. Major strikes (those of over
1,000 workers) averaged 350 per year in the 1950s, as opposed to 20 per year in the
past decade (Bureau of Labor Statistics 2013). In 1952, 470 major strikes (those of
more than 1,000 workers) involved 2,746,000 workers. In 2008, there were only
15 major work stoppages involving 72,000 workers (Bureau of Labor Statistics 2013).
In terms of lost work days, the results are the same—a drastic decline in strike activity.
In 1952, almost 49 million days were lost to work stoppages; in 2008, the number of
days lost was starkly lower—fewer than 2 million days. The time lost striking represented 0.38 percent of all work time in 1952, compared to a miniscule 0.01 percent of
all work time in 2008.
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It’s not just major strikes that are disappearing. Professor Joseph McCartin, who
has extensively studied strike activity, noted, “There is little reason to believe that
smaller scale work stoppages defied the downward trend in major work stoppages”
(McCartin 2008, 141). Professor McCartin notes that workers in smaller strikes are
more vulnerable to being permanently replaced, so the downward trend in strikes is
similar to that of major strikes.
The key challenge facing the labor movement is how to once again create a movement capable of improving wages and working conditions for broad sections of the
working class. To do that we need a mechanism to force employers to agree to union
demands. As labor analyst Jack Barbash, writing in the 1950s, stated, “The decisive
weapons which the unions utilize (or hold in reserve) to give meaning to collective
bargaining are the strike, the boycott, and the picket line. . . . There can be no collective
bargaining, if, from the union’s standpoint it cannot utilize these means” (Barbash
1956, 213).
For the past twenty years, however, the bulk of trade union activity has not focused
on the key question of reviving an effective strike. Rather, unionists have focused on
other initiatives such as retreating into the public sector, organizing the unorganized,
creating broad-based ties through social unionism, and more recently calls to abandon
the workplace entirely in favor of community coalitions. Others look to events outside
the labor movement such as the Occupy movement for inspiration. All of these are
worthy endeavors.
Yet, in pursuing these different strategies, unionists can avoid confronting the more
difficult economic question facing the labor movement. Bill Fletcher and Fernando
Gapasin, in their book Solidarity Divided, discussed the avoidance of such question by
advocates of organizing the unorganized. “Proponents of the organizing model
focused, for either tactical or ideological reasons, on the symptoms of the larger problem-lack of organizing and the corresponding union decline-rather than on the problem itself: the existing structure and function of U.S. trade unionism” (Fletcher and
Gapasin 2008, 61.).
Ultimately, however, trade unionism will rise and fall in the workplace. In particular, our ability to address the core economic concerns confronting workers. To revive
trade unionism in the United States will require a labor movement capable of redistributing wealth to working people. Creating such a movement will not be easy. It will
require confronting massive international corporations and a judicial system subservient to the interests of capital. To do so, however, requires a labor movement grounded
on firm economic principles.
Declaration of Conflicting Interests
The author declared no potential conflicts of interest with respect to the research, authorship,
and/or publication of this article.
Funding
The author received no financial support for the research, authorship, and/or publication of this
article.
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Labor Studies Journal 37(4)
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