COMPULSORY ARBITRATION
So far I have spoken only of the constructive side of the new
capitalism's labor program, its purpose to produce healthy and
industrially efficient laborers so as to increase profits. "State
Socialism" gives the workingman as a citizen certain carefully measured
political rights, and legislates actively in his behalf as a
profit-producing employee at work, but its policy is reversed the moment
it deals with him and his organizations _as owners and sellers of
labor_.
Towards the individual workers, who are completely powerless either
politically or economically until they are organized, the new capitalism
is, on the whole, both benevolent and actually beneficent. But it does
not propose that organized labor shall obtain a power either in industry
or in government in any way comparable to that of organized capital.
"Successful State Socialism," as Victor S. Clark says in writing of the
Australian experiments, "depends largely upon perfecting public control
over the individual."[72] But compulsory arbitration of labor disputes
which reaches the wage earners' organizations, is far more important to
"State Socialism" than any other form of control over individual. A
considerable measure of individual liberty may be allowed without
endangering this new social polity, and it is even intended
systematically to encourage the more able among the workers by some form
of individual or piece wages--or at least a high degree of
classification of the workers--and by a scheme of promotion that will
utilize the most able in superior positions, and incidentally remove
them out of the way as possible leaders of discontent.
Nor is it intended to use any compulsion on labor organizations beyond
that which is essential to prevent them from securing a power in society
in any way comparable to that of property and capital. For this purpose
compulsory arbitration is the direct and perfect tool. It can be
limited in its application to those industries where the unions really
occupy a position of strategic importance like railroads and coal mines,
and it can be used to attach to the government those employees that are
unable to help themselves. I have mentioned those weaker groups of
employees who would be unable to improve their condition very materially
except by government aid, and, even when so raised to a somewhat higher
level, have no power to harm capitalism. Compulsory arbitration or some
similar device must therefore replace such crudely restrictive and
oppressive measures as have hitherto been applied to the unions.
In the United States all "dangerous" strikes are at present throttled by
court injunctions forbidding the strikers to take any effective action,
and boycotts are held to be forbidden by the Sherman law originally
directed against the "trusts." Recently the Supreme Court decided that
the officers of the American Federation of Labor were not to be
imprisoned for violation of the latter statute. But the decision was
purely on technical grounds, and the court upheld unanimously the
application of the law to the unions. There is little question that the
attorney for the manufacturers, Daniel Davenport, was right when he thus
summed up the court's opinion:--
"It held that the boycott is illegal; that the victim of the
boycott has the right to go into court of equity for protection by
injunction; that such court has the right to enjoin any and every
act done in enforcing the boycott, including the sending out of
boycott notices, circulars, etc., that the alleged constitutional
right of free speech and free press affords the boycotter no
immunity for such publication; that for a violation of the
injunction the party violating it is liable to be punished both
civilly and criminally."
Against this law and the use of injunctions in labor disputes the
Federation of Labor has introduced a bill through Congressman W. B.
Wilson, which aims to free the unions from these legal obstacles by
enacting that no right to continue the relation of employer to employee
or to carry on business shall be construed as property or a property
right; and that no agreement between two or more persons concerning
conditions of employment or its termination shall constitute a
conspiracy or an offense against the law unless it would be unlawful if
done by a single individual, and that, therefore, such an act is not
subject to injunctions. While neither of the great parties has
definitely promised to support this particular measure, one party has
made a vague promise to restrict injunctions, and the leaders of the
progressive wings of both are quite definite about it. Nearly half of
the House of Representatives voted for the repeal of the Sherman law as
applied against union boycotts. Senator La Follette has demanded the
abolition of this species of injunction, and Governor Woodrow Wilson has
accused our federal courts of "elaborating a theory of conspiracy
destined to bring 'the sympathetic strike' and what is termed 'the
secondary boycott' under legal condemnation."
Such reforms are not as radical as might appear to Americans, for the
boycott is legal in Germany, while the crime of "conspiracy" was
repealed in Great Britain in 1875, and the rights of strikers were
further protected in that country by the repeal of the Taff Vale
decision against picketing a few years ago, and yet unions are in no
very strong position there. And weak as they are, the talk of compulsory
arbitration is growing, and it seems only question of time until some
modification of it is adopted. And, though the abuse of injunctions and
the other forms of anti-union laws and decisions now prevailing will
probably be done away with in this country, there is little doubt that
here also employers will use some great coal or railroad strike as a
pretext for enacting a compulsory arbitration law.[73]
Similarly, as governments continue to take on new industrial functions,
great importance is attached to the right of government employees, now
denied, to organize and to join unions. Senator La Follette and other
progressives also champion this right against President Taft, and will
doubtless win their fight, but, as I shall show later a right to
organize does not mean a right to strike--and there seems no probability
that any government will fail to answer the effort to strike on any
very large scale either by punishment for conspiracy against the State
or by excluding the strikers permanently from government employment.
They will doubtless be offered, as in France, instead of the right to
strike, the right to submit their grievances as a body, if they wish it,
to some government board (see Part III, Chapter VI).
The Australasian labor leaders were the first and are still the chief
advocates of compulsory arbitration among the unionists, and if they
find it used against them they have nobody but themselves to blame. That
Labor is disappointed in the result in those countries is shown by the
fact that of late years, both in Australia and New Zealand, the most
important strikes have been settled outside of the compulsory
arbitration acts, and Mr. Clark states that he is unaware of any
important exception.
But that the workers in Australia still hope to use this legislation for
their purposes is shown by the referendum of 1911, by which they sought
to nationalize the State laws on the subject. At the time of the
railroad strike in Victoria, Australia, in 1903, a law was passed which
imposed a penalty of "twelve months' imprisonment or a fine of one
hundred pounds" for engaging in a strike on government railways, and
made a man liable to arrest without warrant or bail "for advising a
strike orally or by publication, or for attending any meetings of more
than six persons for the purpose of encouraging strikers." Even then the
limit had not been reached. In 1909 the Parliament of New South Wales
passed an act especially directed against strikes in any industry which
produced "the necessary commodities of life [these being defined as
coal, gas, water, and food] the privation of which may tend to endanger
human life or cause serious bodily injury," and the penalty of twelve
months' imprisonment of the Victorian law was extended to all this vast
group of industries also. The law of New South Wales was most stringent,
providing that any one taking part in a strike meeting under these
circumstances is also liable to twelve months' imprisonment, and that
the police may break into the headquarters of any union and seize any
documents "which they reasonably suspect to relate to any walk-out or
strike." Under this law the well-known labor leader, Peter Bowling, was
sentenced to one year of imprisonment.
The unions violently denounced this enactment, but chiefly as they had
denounced previous legislation, on the ground that it permitted
_unorganized_ workmen to apply for relief under the law. That is to say,
while the employers were using the law to make striking a crime, they
were extending such benefits as it produced to the nonunion workers who
can often be used as tools for their purposes. But the astounding hold
that "State Socialism" has on the Australian masses, especially on the
working people, is shown by the steadfast belief that this measure can
be amended so as to operate to their interest. Bowling and his unions
made a serious agitation for the general strike against the coercive
measure just mentioned, but it was only by a tie vote that the New South
Wales Labour Congress even favored protest in the form of cancelling the
agreement which the unions had made under the Industrial Disputes Acts,
while in the next elections New South Wales returned a majority of labor
representatives opposing Bowling's policy of radical protest. That is,
the majority of the working people still express confidence in the
possibilities of compulsory arbitration, and even want to extend it.
Professor Le Rossignol of the United States and Mr. William D. Stewart
of New Zealand have undertaken a careful and elaborate investigation of
compulsory arbitration in New Zealand.[74] A reference to a few of their
quotations from original documents will show the nature and
possibilities of this coercive measure as it has developed in the
country of its origin. The original law in New Zealand was introduced by
the Honorable William Pember Reeves, the Minister of Labor, in 1894, and
was supported by the labor leaders. Mr. Reeves says: "What the act was
primarily passed to do was to put an end to the larger and more
dangerous class of strikes and lockouts. The second object of the act's
framer was to set up tribunals to regulate the conditions of labor."
"Mr. Reeves' chief idea," say our authors, "was to prevent strikes, and
a great deal more was said in Parliament about industrial peace than
about the improvement in the conditions of labor which the act was to
bring about. But there can be little doubt that the unionists, without
whose help the act could not have been passed, thought more of the
latter than of the former result, and looked upon the act as an
important part of the new legislation for the benefit of the working
class." Here is the contrast that we must always keep in mind. _The
purpose of the unionists is to see if they cannot obtain improvements in
their conditions; the purpose of the employers and also of "the public"
is to prevent strikes._ One of the most able students of the situation,
Mr. MacGregor, has shown that since the passing of the law the latter
purpose has been thoroughly accomplished, since it has been used not
only as was originally intended, to settle labor disputes which become
so serious as to threaten to "arrest the processes of industry," but
that it has practically built up a "system of governmental regulation of
wages and conditions of labor in general." That is to say, the law has
accomplished rather the purposes of the employers than those of the
employees.
In another point of the most fundamental importance the law has become
something radically different from what the labor leaders who first
favored it hoped it would be. The act of 1894 was entitled: "An act to
encourage the formation of industrial unions and associations and to
facilitate the settlement of industrial disputes by conciliation and
arbitration." By the amendment of 1898 the words, "to encourage the
formation of industrial unions and associations," were left out. Thus
the law ceased to be directly helpful to the very unions which had done
so much to bring it about and are the only means employees possess to
make the law serve them instead of becoming a new weapon for employers.
An early decision of the Arbitration Court in 1896 had declared that
preference should be given to the unionists. "Since the employer was the
judge of the qualifications of his employees, the unionists did not gain
much by this decision," say Le Rossignol and Stewart. "In later awards
it was usually specified that preference was granted only when the union
was not a closed guild, but practically open to every person of good
character who desired to join." These later decisions brought it about
that the so-called preference of unionists became no preference at all.
"The Arbitration Court, except in a few minor cases, has refused to
grant unconditional preference and the unionists, realizing that
preference to an open union is no preference at all, now look to
Parliament for redress and demand statutory unconditional preference to
unionists."
In 1905 strikes and lockouts were made statutory offenses, and a single
judge was given the power practically to force the individual worker to
labor. After ten years of trial the law had become almost
unrecognizable from the workingman's standpoint, and from this moment on
the resistance to it has grown steadily. In a decision rendered in 1906,
the Chief Justice said: "The right of a workman to make a contract is
exceedingly limited. The right of free contract is taken away from the
worker, and he has been placed in a condition of servitude or status,
and the employee must conform to that condition." Not only do judges
have this power, but they have the option of applying or not applying it
as they see fit, for the amendment of 1908 "expressly permits the court
to refuse to make an award if for any reason it considers it desirable
to do so." With a law, then, that in no way aids the unions, as
such--however beneficial it may be at times to the individual
workingman--and which leaves an arbitrary power in the hands of the
judge elected by an agricultural majority, what has been the _concrete_
result? Especially, what principles have been applied by the judges?
Of course the first principle has been that all the working people
should get what is called a "minimum" or a "living" wage, but our
authors show that merely to keep their heads above the sea of pauperism
was not at all the goal of the workers of New Zealand. No doubt they
were already getting such a wage in that relatively new and prosperous
country, yet this was all the new law did or could offer, besides
keeping existing wage scales up to the rising cost of living. Anything
more would have required, not compulsory arbitration, but a series of
revolutionary changes in the whole economic and political structure.
"Another stumbling block in the way of advance in wages is the
inefficient or marginal or no-profit employer, who, hanging on the
ragged edge of ruin, opposes the raising of wages on the ground that the
slightest concession would plunge him into bankruptcy. His protests have
their effect on the Arbitration Court, which tries to do justice to all
the parties and fears to make any change for fear of hurting somebody.
But the organized workers, caring nothing for the interests of any
particular employer, demand improved conditions of labor, though the
inefficient employer be eliminated and all production be carried on by a
few capable employers doing business on a large scale and able to pay
the highest wages."
Here is the essential flaw in compulsory arbitration in competitive
industries (its limitations under monopolies will be mentioned later).
The courts cannot apply a different standard to different employers. On
the other hand, they cannot fix a wage which any employer cannot afford
to pay or which will drive him out of business. That is to say, the
standard tends to be fixed by what the poorest employer can pay, the
employer who, from the standpoint either of capital or of labor or of
efficient industry, really deserves to be driven from business. An
exception is made only against such employers as cannot even afford to
pay a _living_ wage--these alone are eliminated.
Le Rossignol and Stewart show that in view of these considerations the
court has repeatedly stated that "profit sharing could not be taken as a
basis of awards, on the ground that it would involve the necessity of
fixing differential rates of wages, which would lead to confusion, would
be unfair to many employers, and unsatisfactory to the workers
themselves."
With such a principle guiding the court, and it is probably a necessity
under commercial competition, it is no wonder that some of the
representatives of the unions have claimed that annual real wages have
actually fallen. "It is not easy," say our authors, "to show that
compulsory arbitration has greatly benefited the workers of the Colony.
Sweating has been abolished, but it is a question whether it would not
have disappeared in the years of prosperity without the help of the
Arbitration Court. Strikes have been largely prevented, but it is
possible that the workers might have gained as much or more by dealing
directly with their employers than by the mediation of the court. As to
wages, it is generally admitted that they have not increased more than
the cost of living. A careful investigation by Mr. von Dalezman, the
Registrar-General, shows that, while the average wages increased from
1895 to 1907 in the ratio of 84.8 to 104.9, the cost of food increased
in the ratio of 84.3 to 103.3. No calculation was attempted for clothing
or rent." If we take it into account that rents have risen very rapidly
and are especially complained of by the working people, we can see that
real wages, measured by their purchasing power, probably fell in the
first twelve years of compulsory arbitration, notwithstanding that it
was on the whole a period of prosperity in the Colony. For ten years, as
a consequence, the complaints of the workers against the decisions have
been growing, "not because the wages were reduced, but because they
were not increased and because other demands were not granted."
When the unions perceived that the principles for which they have been
contending were not granted, and that their material conditions were not
being improved, it was suggested that the judge of the Arbitration Court
should be elected by the people, in the hope that the unions might
control the election, "but this would be at variance with all British
traditions and could not be brought about," say our authors. No doubt
British tradition has had something to do with the matter, but the
impracticability of this remedy is much more due to the fact that the
employees confront an agricultural and middle class majority.
At first it was the employers who were displeased, but now they are
becoming converted. The employers, say Le Rossignol and Stewart, "have
come to realize that they might have lost more by strikes than they have
ever lost by arbitration; and, since the workers have been dissatisfied,
the employers are more disposed to stand by the act, or to maintain a
neutral attitude, waiting to see what the workingmen will do."
It would seem, then, that the real gain from the law has been through
the abolition of strike losses, and since these had previously been
borne by employers and employees alike, this saving has been pretty
equally divided between the two classes, neither making any relative
gain over the other. But at the bottom this is a blow to the unions, for
the purpose of every union policy is not merely to leave things where
they were before, but to increase the workers' relative share. Any
policy that brings _mutual_ gain requires no organized struggle of any
kind. It is the workers who are the plaintiffs, and the employers the
defendants. When things are left _in statu quo_ it is a moral and actual
defeat for the employees.
This is why, in the last two or three years, the whole labor movement in
New Zealand has arisen against the law. In 1908 the coal miners' union
refused to pay a fine levied against it, alleging that it had no funds.
"In this position the union was generally condemned by public opinion,
but supported by a number of unions by resolutions of sympathy and gifts
of money. Finally, the Arbitration Court decided to proceed against the
men individually for their share of the fine. The whole of the fine,
together with the costs of collection, amounting to over 147 pounds, was
recovered by means of attachment orders under the Wages Attachment Act
of 1895. According to a recent decision of the Court of Appeals, the men
could have been imprisoned, if they had refused to pay, for a maximum
term of one year, but it was not necessary to do this, and public
opinion was not in favor of imprisonment for the offense."
This and other strikes in 1907 and 1908 "caused a widespread opinion
among _employers_ and the general public that the act should be amended
chiefly for the sake of preventing strikes. The laborers, as a class,
were not enthusiastic about the matter, since the proposed amendments
were designed to compel them to obey the law rather than to bring them
any additional benefit." After having been debated for a year, a new law
was passed, and went into effect January 1, 1909. This new law, though
still compulsory, repeals some of the features of the previous
legislation which were most obnoxious to the unions. Even this act,
however, they found entirely unsatisfactory, and "during the year ending
March 31, 1909, sixteen workers' unions, and a like number of employers'
unions, had their registration cancelled for neglect, while two other
unions formally cancelled their registration." This meant practically
that these unions have withdrawn from the field of the act and expressed
their disapproval of compulsory arbitration, even in its recently
modified form. Not only have the unions been withdrawing, but, freed
from its bondage, they began at once to win their most important
strikes, indicating what its effect had been. Even the employees of the
State have been striking, and successfully.
"The workers' position is embarrassing. The original act was passed for
their benefit as well as to prevent strikes, but when it could no longer
be used as a machine for raising wages, they were the first to rebel
against it." There can be no doubt that our authors are correct, and
that the working people are beginning to feel they have been trapped. In
both New Zealand and Australia they have given their approval to an act
which in actual practice may become more dangerous than any weapon that
has ever been forged against them. The only possible way they could gain
any advantage from it would be if they were able to elect the judge of
the Arbitration Court, but, to obtain a political majority for this
purpose, they would have to develop a broad social program which would
appeal to at least a part of the agriculturists as well as to the
working people, but here we turn to the considerations to be brought out
in the next chapter.
Mr. Charles Edward Russell, as the result of two visits to Australasia,
has very ably summed up the Socialist view of compulsory arbitration in
_The Coming Nation_, of which he is joint editor. Mr. Russell says:--
"The thing is a failure, greatly to the surprise of many capable
observers, and yet just such a result might have been expected from
the beginning, and for two perfectly obvious reasons, both of
which, strange to say, were universally overlooked.
"In the first place, the court was nominally composed of three
persons, and really of one. That one was the judge appointed by the
government.
"The representative of the employers voted every time for the
employers; the representative of the unions voted every time for
the unions; the judge alone decided, and might as well have
constituted the whole court.
"At first the judge decided most of the cases in favor of the
policy of increasing wages. Fine, again. Many wage scales ascended.
"But the judge, as a rule, did not like his job. He desired to get
to the Supreme Court as rapidly as possible; to the Supreme Court
where the honors were. A succession of judges went by. At last came
one that agreed with the employers that wages were too high for the
welfare of the country. This had long been a complaint of the
manufacturers in particular, who were fond of pointing out how high
wages discouraged the opening of new factories, and consequently
the development of the country. This judge, being of the same
opinion, apparently, began to decide the cases the other way.
"Then, of a sudden the second fatal defect in the system opened up.
"The men grew restless under the adverse decisions of the court.
That raised a new question.
"How are you going to compel men to work when they do not wish to
work under the conditions you provide?
"Nobody had thought of that."
Referring, then, to the failure to prevent the strike of the
slaughterers against the law in 1907, or to punish them after they had
forced their employers to terms, Mr. Russell gives the Socialist opinion
of the legislation of 1908, passed to remedy this situation:--
"At the next session of Parliament it amended the law to meet these
unexpected emergencies and find a way to compel men to work.
"To strike after a case had been referred to the court was now
made a crime, punishable by a fine, and if the fine were not paid,
the strikers' goods could be distrained and he could be imprisoned.
Any labor union that ordered a strike or allowed its members to
strike was made subject to a fine of $500. Outside persons or
organizations that aided or abetted a strike were made subject to
severe penalties.
"Fine, again. But suppose the labor unions should try to evade the
law by withdrawing from registry under the act? _Government thought
once more, and produced another amendment by which the penalties
for striking were extended to all trades engaged in supplying a
utility or a necessity, whether such trades were organized or not._
"You could hardly surpass this for ingenuity. 'Supplying a
necessity' would seem to cover about everything under the sun and
to make striking impossible. There must be no more strikes.
"Sounds like home, doesn't it? To do away with strikes. You see the
employing class, which all around the world gets what it wants and
controls every government, had put itself back of the arbitration
law. It had discovered that the law could be made to be a good
thing, so it was at the dictation of this class that the amendments
were passed. What the injunction judges do in America, or try to
do, the law was to do in New Zealand.
"Except that not Judge Goff nor Judge Guy, nor any other injunction
judge of our own happy clime, has dared to go quite so far as to
declare that all striking everywhere is a crime to be punished with
imprisonment.
"How are you going to compel men to work? Why, thus, said the
government of New Zealand. Put them in jail if they do not like the
terms of their employment."
Mr. Russell then gives an account of the miners' strike, above referred
to, which he points out was ended by the labor department paying the
miners' fines. He concludes:--
"Mr. Edward Tregear, a scholar and thinker, had filled for many
years the place of chief secretary for labor. It is not a cabinet
office, but comes next thereto. He is a wise person and a sincere
friend of the worker, as he has shown on many occasions. As soon as
he heard that the ministry actually purposed to imprison the miners
because they did not like the terms of their employment, he went to
the minister of labor and earnestly protested, protested with tears
in his eyes, as the minister himself subsequently testified,
begged, argued, and pleaded. No possible good could come from such
rigor, and almost certainly it would precipitate grave disaster.
"To all this the minister was obdurate. Then Mr. Tregear said that
he would resign; he would not retain his office and see men
imprisoned for exercising their inalienable right of choice,
whether they would or would not work under given conditions.
"Now Mr. Tregear was one of the most popular men in New Zealand,
and his resignation under such conditions would raise a storm that
no ministry would care to face. Hence the government was in a worse
situation than ever. On one side it fronted a dangerous venture
with the certainty of a tremendous handicap in the resignation of
the chief secretary, and on the other hand was an acknowledgment
that the arbitration law was a failure and could be violated with
impunity.
"In this emergency decision was halted for a few hours while the
government people consulted. Meantime, by quick and desperate
efforts, the strike was ended, and the men went back to work.
"This left the fines unpaid. The labor department solved that
difficulty and allowed the defeated government to make its escape
from a hopeless situation by paying the miners' fines.
"To all intents and purposes it was the end of compulsory
arbitration in New Zealand. Not nominally, for nominally the thing
goes on as before; but actually. It is only by breaking our shins
upon a fact that most of us ever learn anything; and the exalted
ministry of New Zealand had broken its shins aplenty on a fact that
might have been discerned from the start.
"If you are to have compulsory arbitration, you must compel one
side as much as the other.
"But in the existing system of society, when you come to compelling
the workers to accept arbitration's awards, you are doing nothing
in the world except to compel them to work, and, however the thing
may be disguised, compulsory work is chattel slavery, against which
the civilized world revolts.
"This is the way the thing works out, and the only way it ever can
work out. There can be no such thing as compulsory arbitration
without this ultimate situation.
"If, therefore, any one in America believes in such a plan for the
settlement of labor troubles, I invite the attention of such a one
to this plain record.
"For my own part, years ago I was wont to blame the labor leaders
of America because they steadfastly rejected compulsory
arbitration, and I now perceive them to have been perfectly right.
The thing is impossible."[75]
A somewhat similar act to the Australasian ones, though less stringent,
has been introduced in Canada. The Canadian law, which is a compromise
between compulsory arbitration and compulsory investigation, applies to
mines, railways, and other public utilities. Strikes have been
prevented, but let us see what benefits the employees have received.
Whatever its effect on wages and hours, the law has the tendency to
weaken the unions, which hitherto have been the only reliable means by
which employees were able to advance their condition. Not only does it
make organization seem less necessary, but it takes the most powerful
weapon of the union, the ability to call a sudden strike. If we add to
this the unfavorable influence on public opinion in case the unions are
not contented with the rewards, and the fact that the law works against
the union shop, which is the basis of some unions, we can understand the
ground of their hostility.
"The Canadian Labour Disputes Investigation Act" is especially
interesting and important because it is serving as a model for a
campaign to introduce legislation along similar lines into the United
States. Already Mr. Victor S. Clark, the author of the study of the
Australian Labour Movement, to which I have referred at the beginning of
the chapter, has been sent by Mr. Roosevelt and Mr. Taft to investigate
into the working of the act. Ex-President Charles W. Eliot of Harvard
has also advocated strenuously and at some length a similar statute, and
it has been made the basis for the campaign in Massachusetts and other
states. Mr. Clark reported: "Under the conditions for which it was
devised, the Canadian law, in spite of some setbacks, is useful
legislation, and it promises more for the future than most
measures--perhaps more than any other measure--for _promoting industrial
peace by government intervention_."
Here is the very keynote to compulsory arbitration, according to its
opponents, whose whole attack is based on the fact that its primary
purpose is not to improve the condition of the working people, but to
promote "industrial peace by government intervention."
Mr. Clark concedes that "possibly workers do sacrifice something of
influence in giving up sudden strikes," though he claims that they gain
in other ways. "After such a law is once on the statute books, however,
it usually remains, and in New Zealand, Australia, and Canada it has
created a new public attitude toward industrial disputes. This attitude
is the result of the idea--readily grasped and generally accepted when
once clearly presented--that the _public_ have an interest in industrial
conflicts quite as immediate and important in its way as that of the
conflicting parties. _If the American people have this truth vividly
brought to their attention by a great strike, the hopeful example of the
Canadian act seems likely, so far as the present experience shows, to
prove a guiding star in their difficulties._" (Italics mine.)
In the agitation that was made in behalf of a similar law in
Massachusetts, just exactly what is meant by the word "public" began to
appear. It refers not only to the consumers of the article produced by
the industry in which the strike occurs, but also to other dependent
industries, to the merchants of the locality where the workmen live, and
to the real estate interests. Here, then, are definite economic
interests which are concerned primarily in the prevention of strikes and
in the uninterrupted operation of the industry, and only in a secondary
way in rates of wages. _It is not a disinterested and non-partisan
public; it is not on the side of the employers nor on the side of the
employees, but it is opposed to the most effective weapons the working
people have yet found to advance their interests, namely, the strike and
the boycott._
It is said that if the workers lose the right to strike, the employers
lose the right to lockout. It has been customary to set the lockout over
against the strike as being of equal importance, but this is not the
truth. Employers can discharge their workingmen one at a time when they
are dissatisfied with a limited number; and they can often find a
business protest for temporarily shutting down or restricting their
output. To abolish strikes, then, is to take away the employees' chief
means of offense or defense; while to pretend to abolish strikes _and
lockouts_ is to leave in the hands of the employers the ability to
discharge or punish in other ways the men with whom they are
dissatisfied.
When it was proposed to introduce the Canadian law in Massachusetts, no
unionists of prominence indorsed it, but it was favored by a very large
number of employers, while those employers who objected did so for
widely scattered reasons. Mr. Clark is probably right in suggesting
that, while such a law will not be enacted in the United States as
things are now, it is very probable that it can be secured after some
industrial crisis--and there is little doubt that President Eliot and
perhaps also Mr. Roosevelt, for whom Mr. Clark was investigating, and
many other influential public men, are expecting this time to arrive
soon.
The attitude of a large minority of British unions and of a considerable
part of the British Socialists is similar to that of the Canadian and
Australian majority. When in 1907 the railway employees of Great Britain
were for the first time sufficiently aroused and organized, and on the
point of a national strike, a settlement was entered into through the
efforts of Mr. Lloyd George and the Board of Trade (and it is said with
the assistance of King Edward) which involved an entirely new principle
for that country. A board was constituted to settle this and future
strikes of which the Master of Rolls and other British functionaries
were the leading elements. Actually the workers consented for several
years to leave in the hands of the judges over whose election and
appointment they have only an indirect and partial, if indeed any,
control, complete power over their industrial life. The executive of the
Fabian Society issued a manifesto congratulating the government on this
"progressive" settlement, though few prominent labor leaders were
willing to give it their full indorsement. The Fabian manifesto said
that the advance in wages which could be secured by the settlement "will
undoubtedly have been secured on the trade-union program, through the
trade-union organization, by the trade union's representatives, and
finally, in the argument before the arbitrator, by the ability of the
trade union's secretary." But this settlement had nearly all the
features of the Canadian law which I have just mentioned, and especially
in failing to give any recognition to the unions, left the strongest
possible weapon in the hands of their enemies. Nevertheless, more than a
third of the members of the British Trade Union Congress voted since
that time for a compulsory arbitration act, and British radicals like
Percy Alden, M.P., to say nothing of conservatives, agitate for a law
along New Zealand lines. The railway strike of 1911 has decreased the
popularity of this proposal among unionists and Socialists, but has
augmented it in still greater proportion among nearly all other classes.
In the meanwhile, in spite of the employees' efforts, and external
concessions by the employers, the power in the newest railway
conciliation scheme lies also in the hands of the government (see Part
III, Chapter V).
Statements by President Taft and other influential Americans lead us to
believe it will be a very short period of years before similar
legislation is applied to this country, in spite of the hostility of the
unions, or perhaps with the consent of some of the weaker among them,
which have little to gain by industrial warfare. While Secretary of War,
Mr. Taft predicted a controversy between capital and labor which should
decide once and for all how capital and labor should share the joint
profits which they created. In this and many similar utterances there is
foreshadowed the interference of the State. Indeed, the settlement of
the Pennsylvania coal strike in 1903 was a clear example of such
interference, and there is no question that the precedents established
will be followed up on the next occasion of the kind by some arrangement
even less advantageous to employees who now almost universally feel, as
the present demands of the miner's union show, that they got the worst
of the former decision.
The railway and mining situations in Great Britain, and the demand for
the government to take some measure to protect employees against the
"trusts" in this country (to say nothing of the menace of a great coal
strike), promise to make compulsory arbitration an issue of the
immediate future. Mr. Roosevelt, who now proposes that the government
should interfere between monopolies and their employees, is the very man
who is responsible for the coal strike tribunal of 1903, which not only
denounced sympathetic strike and secondary boycott, but failed to
protect the men against discrimination on account of their unionism.
Were he or any one like him President, the institution of government
wage boards would be dreaded like the plague.
Similarly Mr. Winston Churchill, in Great Britain, recognizes the
extreme seriousness of the situation. His position is ably summed up by
the _Saturday Evening Post_:--
"Winston Churchill has propounded a capital-and-labor puzzle to his
British constituents.
"To a modern state, he says in substance, railroad transportation
is a necessity of life--and how literally true this is of England
was shown in the general strike of last August, when the food
supply in some localities ran down to only a few days'
requirements. So the government cannot permit railroad
transportation to be paralyzed indefinitely by a strike. It cannot
sit by and see communities starve. A point will soon be reached
where it must intervene and force resumption of transportation.
"Strikes, however, form one of the modern means of collective
bargaining between employer and employees. They are, in fact, the
workmen's final and most effective resource in driving a bargain.
Denied the right to strike, labor unions would be so many wooden
cannon at which employers could laugh. If the employer knew
absolutely that the men could not strike, he might offer any terms
he pleased. In wage bargaining the men would not stand on a level
footing, but be bound and gagged.
"If, then, the government takes away, or seriously restricts, the
right of the men to strike, isn't it bound to step into the breach
and readjust the balance between them and the employer, by
compelling the employer to pay them fair wages? There can be no
free bargaining if it is known that at a certain point the
government will intervene on one side. Must it not, then, also be
known that at a certain point the government will intervene on the
other side and compel payment of adequate wages?
"Mr. Churchill carries his puzzle only that far. On our own account
we add, How far will that leave us from regulation of wages as well
as of rates by the government, and how far will that leave us from
government ownership?"[76]
In a word, Mr. Churchill's remedy for the evils of "State Socialism" is
more "State Socialism"--and undoubtedly there is an inevitable trend in
that direction. But the government railway strikes of France, Austria,
Italy, Hungary, and other countries ought to show him that his remedy,
advantageous as it may be from many standpoints, is scarcely to be
considered even as a first step towards the solution of the labor
problem. As long as capitalists continue to control government, "State
Socialism," on the contrary, makes the strike more necessary, more
decisive, and invaluable, not only to employees, but to every class that
suffers from the government or the economic system it supports.
The most representative of American Socialists, Eugene V. Debs, has
given us an excellent characterization of this movement as it appears to
most Socialists.
"Successful leaders are wise enough to follow the people. For
instance, the following paragraph is to the point:--
"'Ultimately I believe that this control of corporations should
undoubtedly, directly or indirectly, extend to dealing with all
questions connected with their treatment of their employees,
including the wages, the hours of labor, and the like.'
"And what Socialist made himself ridiculous by such a foolish
utterance? No Socialist at all; only a paragraph from his latest
article on the trusts by Theodore Roosevelt. Five years ago, or
when he was still in office and had the power, he would not have
dared to make that statement. But he finds it politically safe and
expedient to make it now. It is not at all a radical statement. On
the contrary, it is simply the echo of E. H. Gary, that is to say,
John Pierpont Morgan, president of all the trusts.
"Mr. Roosevelt now proposes that Bismarck attempted in Germany
forty years ago to thwart the Socialist movement, and that is State
Socialism, so called, which is in fact the most despotic and
degrading form of capitalism.
"President Roosevelt, who is popularly supposed to be hostile to
the trusts, is in truth their best friend. He would have the
government, the capitalist government, of course, practically
operate the trusts and turn the profits over to their idle owners.
This would mean release from responsibility and immunity of
prosecution for the trust owners, _while at the same time the
government would have to serve as strikebreaker for the trust
owners_, and the armed forces of the government would be employed
to keep the working class in subjection.
"If this were possible, it would mark the halfway ground between
industrial despotism and industrial democracy. But it is not
possible, at least it is possible only temporarily, long enough to
demonstrate its failure. The expanding industrial forces now
transforming society, realigning political parties, and reshaping
the government itself cannot be fettered in any such artificial
arrangement as Mr. Roosevelt proposes. These forces, with the
rising and awakening working class in alliance with them, will
sweep all such barriers from the track of evolution until finally
they can find full expression in industrial freedom and social
democracy.
"In this scheme of State Socialism, or rather State capitalism, Mr.
Roosevelt fails to inform us how the idle owners of the trusts are
to function except as profit absorbers and parasites. In that
capacity they can certainly be dispensed with entirely and that is
precisely what will happen when the evolution now in progress
culminates in the reorganization of society."[77] (My italics.)
[72] Victor S. Clark, "The Labour Movement in Australasia."
[73] In her "American Socialism of the Present Day" (p. 185), Miss
Hughan has quoted me (see the _New York Call_ of December 12, 1909), as
classing the abolition of the injunction as one of the revolutionary
demands never to be satisfied until the triumph of Socialism. As a means
to check the growth of the power of the unions, this method of arbitrary
government by judges has never been resorted to except in the United
States. It is evident, then, that this statement was only meant for
America. It should also have been qualified so as to apply solely to the
America of to-day. For as other methods of checking the unions exist in
other countries, it is obvious that they could be substituted in this
country for the injunction, a proposition in entire accord with all I
have written on the subject--though unfortunately not stated in this
brief journalistic expression. I have now come to the belief, on the
grounds given in the text, not only that a new method of fighting the
unions (namely, compulsory arbitration) _can_ be substituted for the
injunction, but that this _will_ be done within a very few years.
[74] Professor Le Rossignol and Mr. William D. Stewart, "Compulsory
Arbitration in New Zealand," in the _Quarterly Journal of Economics_.
Reprinted in their book, "State Socialism in New Zealand."
N. B. The reader who is interested is referred to the whole of both
these volumes. There is little matter in either that does not have a
direct bearing on our subject, and they have been utilized throughout
this and the following chapter.
FOOTNOTES:
[75] _The Coming Nation_, Sept. 2, 1911.
[76] The _Saturday Evening Post_, Nov. 25, 1911.
[77] The _New York Times_, Nov. 25, 1911.