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 THE 
 WORKERS AT WAR 
 
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 TTbc Century flew TKHorU) Series 
 
 W. F. WlLLOUGHBY, GENERAL EDITOR 
 
 THE NEW WORLD OF SCIENCE 
 Edited by Robert M. Yerkes 
 
 POLITICAL SYSTEMS IN TRAN- 
 SITION 
 
 By Charles G. Fenwick 
 
 THE WORKERS AT WAR 
 
 By Frank Julian Warne 
 
 Other titles will be published later
 
 3be Gentun; flew Motto Settee 
 
 I 
 
 THE 
 WORKERS AT WAR 
 
 BY 
 
 FRANK JULIAN ^WARNE 
 
 MANAGER INDUSTRIAL RELATIONS, UNITED STATES 
 HOUSING CORPORATION 
 
 Author of "The Tide of Immigration," etc. 
 
 NEW YORK 
 THE CENTURY CO. 
 
 1920
 
 Copyright, 1920, by 
 THE CENTUBY Co. 
 
 UNIVERSITY OF SOUTHERN CALIFORNIA LIBRARY
 
 MY CREED 
 
 I believe in the United States of America as a gov- 
 ernment of the people, by the people, for the people, 
 whose just powers are derived from the consent of the 
 governed; a democracy in a republic; a sovereign 
 Nation of many sovereign States; a perfect Union, 
 one and inseparable, established upon those principles 
 of freedom, equality, justice, and humanity for which 
 American patriots sacrificed their lives and fortunes. 
 I therefore believe it is my duty to my country to love 
 it ; to support its Constitution ; to obey its laws ; to 
 respect its flag; and to defend it against all enemies. 
 WILLIAM TYLER PAGE. 
 
 I further am of the faith that each and all of these 
 can best be realized through democracy in industry 
 which will secure and assure to all the people a fair 
 profit to the producer, a fair wage to the worker, and 
 a fair price to the consumer.
 
 CONTENTS 
 
 CHAPTER PAGE 
 
 I THE WORLD WAR AND DEMOCRACY 3 
 
 II DEMOCRACY AND THE AMERICAN WORKINGMAN . . 14 
 
 III INDUSTRIAL AUTOCRACY AND THE WORKERS ... 26 
 
 IV THE WORKERS AND THE WORLD WAR 35 
 
 V THE AMERICAN WORKINGMAN AT WAR .... 48 
 
 VI WORKING FOR THE GOVERNMENT ...... 59 
 
 VII THE GOVERNMENT AS THE EMPLOYER 69 
 
 VIII THE WILSON ADMINISTRATION'S LABOR POLICY . . 79 
 
 IX THE GOVERNMENT AND THE RAILWAY EMPLOYES . . 88 
 
 X THE GOVERNMENT AND SHIPBUILDING LABOR ... 99 
 
 XI THE GOVERNMENT AND COAL MINE WORKERS . . . in 
 
 XII THE GOVERNMENT AND INDUSTRIAL RELATIONS . .119 
 
 XIII THE NATIONAL WAR LABOR BOARD 131 
 
 XIV THE FEDERAL DEPARTMENT OF LABOR 140 
 
 XV THE GOVERNMENT, WAGES, AND THE COST OF LIVING 152 
 
 XVI THE Vicious CYCLE AND THE LABOR UNION . . . 162 
 
 XVII CAUSES AND EFFECTS OF THE Vicious CYCLE . . . 175 
 
 XVIII THE Vicious CYCLE, STRIKES, AND THE CONSUMER . 187 
 
 XIX DEMOCRACY IN INDUSTRY 200 
 
 XX THE THREE PARTIES TO PRODUCTION ..... 210 
 
 XXI INDUSTRIAL AUTOCRACY AND THE CONSUMER . . . 219 
 
 XXII INDUSTRIAL AUTOCRACY AND THE CORPORATION . . 230 
 
 XXIII THE ORGANIZATION OF THE CONSUMER 240
 
 THE WORKERS AT WAR 
 
 CHAPTER I 
 
 THE WORLD WAR AND DEMOCRACY 
 
 WHEN the Imperial German Army in August, 1914, 
 moved like an avalanche through Belgium and Luxem- 
 burg into northern France there was no statesman sufficiently 
 keen in discernment who would have prophesied America's 
 participation in the conflict. Americans at first were only 
 mildly interested in the event, believing it to be another of those 
 numerous quarrels between European nations with which their 
 traditions taught them they had no concern. They watched 
 the developments of the first months of the war as detailed in 
 the newspapers with little national concern ; only as detached 
 groups was interest manifested . in expressions favorable to 
 one side or the other as the fortunes of war shifted. 
 
 There were those in the nation who sympathized deeply with 
 violated Belgium and its people. There were others, as had 
 always been the case when France was threatened ever since 
 the American Revolution, who felt deep concern for the safety 
 and welfare of the French Republic and people. Still others 
 were strongly pro-British in their traditions and sympathies. 
 Russia was then still an Empire ruled over by the autocratic 
 Czar and, because of its traditional antagonism to popular 
 government and democratic movements, did not appeal in its 
 war aims to any very large group among the American people. 
 To Russia's war campaigns, however, were attached the feelings 
 that accompanied the failure or success of her efforts as an 
 ally of Belgium, France, and Great Britain. There was also 
 
 3
 
 4 THE WORKERS AT WAR 
 
 in America a large group in sympathy with the war aims of 
 Germany and her allies. Most of these were immigrants 
 from that country or their descendants in whose hearts still 
 burned love of the Fatherland. 
 
 While this was true as to large groups in the United States 
 it still also was true that at the beginning of the war, the 
 great majority of Americans were not conscious of any funda- 
 mental concern in the conflict. They saw, at that time, none 
 of their vital principles of government at stake ; they perceived 
 no danger threatening their cherished institutions ; they were in- 
 terested primarily only as spectators of world events. For so 
 many years of their national existence had they kept hands off 
 in quarrels between European states that they had no thought to 
 intervene or become a participant. On the contrary, they had 
 been taught, from the very first days of their existence as a 
 nation, not to become involved in foreign entangling alliances. 
 Washington, their first President, had warned them, and his 
 successors had repeated the warning, that their security as a 
 nation depended upon the observance of this principle of action. 
 And for more than a century and a quarter they had consist- 
 ently followed this precept. 
 
 This attitude undoubtedly would have continued to the end, 
 had not events brought to them realization that their very in- 
 dependence and liberties were involved in the war's final out- 
 come. Not alone through dynamite and bomb outrages in in- 
 dustrial plants in the United States by German sympathizers; 
 by the insidious plotting of spies; by attempts to embroil 
 Mexico in an attack upon the American people, but also and 
 principally by the inhuman work of German submarines in 
 sinking cargo and passenger vessels, and even hospital ships 
 on the high seas, involving the lives and property rights of 
 American citizens was the attitude of the American people 
 gradually changed from that of non-interference to one of 
 growing concern as to their own safety as a nation and finally 
 to that of active participation. 
 
 It is doubtful if the American people would have gone to
 
 THE WORLD WAR AND DEMOCRACY 5 
 
 war even over the sinking of American vessels by German 
 submarines as their Government is usually tolerant enough to 
 give weight to the exigencies of war times. It is equally doubt- 
 ful if proof of a conspiracy by officials of the Imperial German 
 Government, to stir up the antagonism of a neighboring nation 
 on the south, would of itself have caused America to declare 
 war against the German Government. The dynamiting and 
 bombing of industrial plants in this country, which were pro- 
 ducing war munitions for the French, British and their allies, 
 certainly would not of itself have driven America into the war; 
 nor would the intrigues of German spies alone have had this 
 effect. 
 
 Not a single one of the specific causes of complaint against 
 Germany was of itself sufficient to cause the American people 
 finally to take sides against the Central Powers. But each of 
 these causes did supply convincing evidence that something 
 more fundamental than the usual European quarrel between 
 nations was at stake in the conflict. And this something more 
 fundamental the American people slowly began to see was in 
 reality a conflict between two great and vital principles of gov- 
 ernment the principles of autocracy and of democracy. 
 Without question it was because the American people were led 
 finally to believe that democracy with its representative govern- 
 ment was at stake that they entered the war. 
 
 This, in brief, is the explanation of the causes of the arrival 
 of another fateful day just two years and eight months after 
 the beginning of the Great War, when the American people 
 directed their President and Congress to take the official action 
 which threw them as an active participant into the vortex of 
 the world war. On Monday, April 12, 1917, Congress, by 
 joint resolution, declared " a state of war exists between the 
 Imperial German Government and the Government and the 
 people of the United States." The President was authorized 
 and directed " to employ the entire naval and military forces 
 of the United States and the resources of the Government to 
 carry on war against the Imperial German Government; and
 
 6 THE WORKERS AT WAR 
 
 to bring the conflict to a successful termination all the re- 
 sources of the country " were pledged. 
 
 Nothing stirred the soul of the nation with stronger appeal 
 as an effective war cry than President Wilson's paraphrase of 
 the object of the war "The world must be made safe for 
 democracy." " We are glad, now that we see the facts with 
 no veil of false pretense about them," said the President in his 
 address to Congress advising the declaration of war, " to fight 
 thus for the ultimate peace of the world and for the liberation 
 of its peoples, the German peoples included, for the rights of 
 nations, great and small, and the privilege of men everywhere 
 to choose their way of life and of obedience. The world must 
 be made safe for democracy. Its peace must be planted upon 
 the tested foundations of political liberty. We have no selfish 
 ends to serve. We desire no conquest, no dominion. We seek 
 no indemnities for ourselves, no material compensation for 
 the sacrifices we shall freely make. We are but one of the 
 champions of the rights of mankind. We shall be satisfied 
 when those rights have been made as secure as the faith and 
 the freedom of nations can make them." 
 
 Welcoming the Governors of the various States and repre- 
 sentatives of State Councils of National Defense at the White 
 House on May 2, 1917, the President said that the great task 
 before the American people was to make good what the nation 
 had promised to do " go to the defense and vindication of the 
 rights of people everywhere to live as they have a right to live 
 under the very principles of our Nation." 
 
 In a communication to the provisional Government of 
 Russia, 1 the purpose of which was to explain " the objects 
 which the United States has had in mind in entering the war," 
 the President said : " The position of America in this war is 
 so clearly avowed that no man can be excused for mistaking 
 it. She seeks no material profit or aggrandizement of any kind. 
 She is fighting for no advantage or selfish object of her own, 
 but for the liberation of peoples everywhere from the aggres- 
 
 1 Published June 9, 1917.
 
 THE WORLD WAR AND DEMOCRACY 7 
 
 sions of autocratic force." Further on in the communication 
 the President said : " We are fighting for the liberty, the self- 
 government and the undictated development of all peoples." 
 Again he said: " The brotherhood of mankind must no longer 
 be a fair but empty phrase; it must be given a structure of 
 force and reality. The nations must realize their common life 
 and effect a workable partnership to secure that life against 
 the aggressions of autocratic and self-pleasing power." 
 
 " The great fact that stands out above all the rest," said 
 President Wilson at the celebration of Flag Day on June 14, 
 1917, " is that this is a people's war, a war for freedom and 
 justice and self-government amongst all the nations of the 
 world, a war to make the world safe for the peoples who live 
 upon it and have made it their own, the German people them- 
 selves included." 
 
 In virtually every address made by President Wilson follow- 
 ing the formal declaration of war he aimed to interpret some- 
 thing of the spirit of the American people as to the object of 
 their war against the Imperial German Government. In a 
 Memorial Day address at the Arlington Cemetery near Wash- 
 ington on May 30, 1917, he said: 
 
 " Any Memorial Day of this sort is, of course, a day touched 
 with sorrowful memory, and yet I for one do not see how we 
 can have any thought of pity for the men whose memory we 
 honor today. I do not pity them. I envy them, rather; be- 
 cause theirs is a great work for liberty accomplished and we 
 are in the midst of a work unfinished, testing our strength 
 where their strength has already been tested. There is a touch 
 of sorrow, but there is a touch of reassurance also in a day like 
 this, because we know how the men of America have responded 
 to the call of the cause of liberty and it fills our minds with a 
 perfect assurance that that response will come again in equal 
 measure, with equal majesty, and with a result which will hold 
 the attention of all mankin'd. 
 
 " When you reflect upon it, these men who died to preserve 
 the Union died to preserve the instrument which we are now 
 using to serve the world a free Nation espousing the cause 
 of human liberty. In one sense the great struggle into which
 
 8 THE WORKERS AT WAR 
 
 we have now entered is an American struggle, because it is in 
 defense of American honor and American rights, but it is 
 something even greater than that ; it is a world struggle. It is 
 the struggle of men who love liberty everywhere, and in this 
 cause America will show herself greater than ever because 
 she will rise to a greater thing. \Ve have said in the beginning 
 that we planted this great Government that men who wished 
 freedom might have a place of refuge and a place where their 
 hope could be realized, and now, having established such a 
 Government, having vindicated the power of such a Govern- 
 ment, we are saying to all mankind, ' We did not set this Gov- 
 ernment up in order that we might have a selfish and separate 
 liberty, for we are now ready to come to your assistance and 
 fight out upon the field of the world the cause of human liberty.' 
 In this thing America attains her full dignity and the full frui- 
 tion of her great purpose. 
 
 " No man can be glad that such things have happened as 
 we have witnessed in these last fateful years, but perhaps it 
 may be permitted to us to be glad that we have an opportunity 
 to show the principles that we profess to be living principles 
 that live in our hearts, and to have a chance by the pouring out 
 of our blood and treasure to vindicate the thing which we have 
 professed. For, my friends, the real fruition of life is to do 
 the thing we have said we wished to do. There are times 
 when words seem empty and only action seems great. Such 
 a time has come, and in the providence of God America will 
 once more have an opportunity to show to the world that she 
 was born to serve mankind." 
 
 As the President linked our object in the war against Ger- 
 many with the purpose of the men who fought to preserve the 
 Union, so he as strikingly identified that object with the purpose 
 of the men who fought to establish the Union. His Thanks- 
 giving Day Proclamation in November, 1917, served, as did all 
 his public utterances, to arouse and maintain steadfast loyalty 
 to the Government in its prosecution of the war. In that 
 Proclamation he said : 
 
 " We have been given this opportunity to serve mankind as 
 we once served ourselves in the great day of our Declaration 
 of Independence, by taking up arms against a tyranny that 
 threatened to master and debase men everywhere and joining
 
 THE WORLD WAR AND DEMOCRACY 9 
 
 with other free peoples in demanding for all the nations of the 
 world what we then demanded and obtained for ourselves. 
 In this day of the revelation of our duty not only to defend 
 our own rights as a nation but to defend also the rights of free 
 men throughout the world, there has been vouchsafed us in 
 full and inspiring measure the resolution and spirit of united 
 action." We are " in the midst of the greatest enterprise the 
 spirits of men have ever entered upon. ... A new light shines 
 about us. The great duties of a new day awaken a new and 
 greater national spirit in us. We shall never again be divided 
 or wonder what stuff we are made of." 
 
 Speaking at the tomb of Washington at Mount Vernon on 
 July 4, 1918, President Wilson said : 
 
 *' Washington and his associates were thinking, not of them- 
 selves and of the material interests which centered in the little 
 groups of landholders and merchants and men of affairs with 
 whom they were accustomed to act, in Virginia and the colonies 
 to the north and south of her, but of a people which wished 
 to be done with classes and special interests and the authority 
 of men whom they had not themselves chosen to rule over 
 them. They entertained no private purpose, desired no pecu- 
 liar privilege. They were consciously planning that men of 
 every class should be free and America a place to which men 
 out of every nation might resort who wished to share with 
 them the rights and privileges of free men. And we take our 
 cue from them, do we not? We intend what they intended. 
 We here in America believe our participation in this present 
 war to be only the fruitage of what they planted. Our case 
 differs from theirs only in this, that it is our inestimable priv- 
 ilege to concert with men out of every nation which shall make 
 not only the liberties of America secure but the liberties of every 
 other people as well. We are happy in the thought that we 
 are permitted to do what they would have done had they been 
 in our place. There must now be settled once for all what 
 was settled for America in the great age upon whose inspira- 
 tion we draw today. . . . 
 
 " This, then, is our conception of the great struggle in which 
 we are engaged. The plot is written plain upon every scene 
 and every act of the supreme tragedy. On the one hand, 
 stand the peoples of the world not only the peoples actually 
 engaged, but many others also who suffer under mastery but
 
 io THE WORKERS AT WAR 
 
 cannot act ; peoples of many races and in every part of the 
 world the people of stricken Russia still among the rest 
 though they are for the moment unorganized and helpless. 
 Opposed to them, masters of many armies, stand an isolated, 
 friendless group of governments who speak no common pur- 
 pose, but only selfish ambitions of their own by which none 
 can profit but themselves, and whose peoples are fuel in their 
 hands; governments which fear their people and yet are for 
 the time their sovereign lords, making every choice for them 
 and disposing of their lives and fortunes as they will, as well as 
 of the lives and fortunes of every people who fall under their 
 power governments clothed with the strange trappings and 
 the primitive authority of an age that is altogether alien and 
 hostile to our own. The Past and the Present are in deadly 
 grapple and the peoples of the world are being done to death 
 between them." 
 
 President Wilson's ability to arouse the patriotic motives 
 and impulses of the American people by linking the object for 
 which they went to war against Germany with those of the 
 historic events of their growth as a nation is again illustrated 
 in his message to the farmers' conference in session at Urbana, 
 Illinois, January 31, 1918. In that address he declared the 
 object of the war in which we were engaged to be " the greatest 
 that free men have ever undertaken " ; " it was necessary for 
 us as a free people to take part in this war " ; America is fight- 
 ing " as truly for the liberty and self-government of the United 
 States as if the war of our own Revolution had to be fought 
 over again " ; " our national life and our whole economic de- 
 velopment will pass under the sinister influence of foreign con- 
 trol if we do not win " ; " America has the greatest opportunity 
 she has ever had to make good her own freedom and in mak- 
 ing it good to lend a helping hand to men struggling for their 
 freedom everywhere " ; " it was farmers from whom came the 
 first shots at Lexington, that set aflame the revolution that 
 made America free " ; and " this great last war for the emanci- 
 pation of men from the control of arbitrary government and 
 the selfishness of class legislation and control." 
 
 President Wilson lost no opportunity early in the war to
 
 THE WORLD WAR AND DEMOCRACY 11 
 
 state and re-state and reiterate the objects and purposes for 
 which the United States entered the European conflict. In 
 concise and clear-cut comparisons he identified our participation 
 in the war as a part of the American struggle for independence 
 and democracy and he constantly drew analogies between our 
 purposes in the present conflict and those of the past by which 
 the United States was established and preserved as a Republic. 
 In the Presidential address at the joint session of the House 
 and Senate on December 4, 19^7, in which Congress was asked 
 to declare war against Austro-Hungary, he said : 
 
 " For us this is a war of high principle, debased by no selfish 
 ambition of conquest or spoliation; ... we have been forced 
 into it to save the very institutions we live under from corrup- 
 tion and destruction. The purposes of the Central Powers 
 strike straight at the very heart of everything we believe in; 
 their methods of warfare outrage every principle of humanity 
 and of knightly honor; their intrigue has corrupted the very 
 thought and spirit of many of our people; their sinister and 
 secret diplomacy has sought to take our very territory away 
 from us and disrupt the Union of the States. Our safety 
 would be at an end, our honor forever sullied and brought into 
 contempt were we to permit their triumph. They are striking 
 at the very existence of democracy and liberty. 
 
 " It is because it is for us a war of high, disinterested pur- 
 pose, in which all the free peoples of the world are banded 
 together for the vindication of right, a war for the preservation 
 of our nation and of all that it has held dear of principle and 
 of purpose, that we feel ourselves doubly constrained to propose 
 for its outcome only that which is righteous and of irreproach- 
 able intention, for our foes as well as for our friends. The 
 cause being just and holy, the settlement must be of like motive 
 and quality. For this we can fight, but for nothing less noble 
 or less worthy of our traditions. For this cause we entered the 
 war and for this cause will we battle until the last gun is fired." 
 
 Again in his address to the joint session of the House and 
 Senate on January 8, 1918, among other things the President 
 said: 
 
 "We entered this war because violations of right had occurred 
 which touched us to the quick and made the life of our own
 
 12 THE WORKERS AT WAR 
 
 people impossible unless they were corrected and the world 
 secured once for all against their recurrence. What we de- 
 mand in this war, therefore, is nothing peculiar to ourselves. 
 It is that the world be made fit and safe to live in ; and particu- 
 larly that it be made safe for every peace-loving nation which, 
 like our own, wishes to live its own life, determine its own 
 institutions, be assured of justice and fair dealing by the other 
 peoples of the world as against force and selfish aggression. 
 All the peoples of the world are, in effect, partners in this 
 interest, and for our own part we see very clearly that unless 
 justice be done to others it will not be done to us. The program 
 of the world's peace, therefore, is our program ; and that pro- 
 gram, the only possible program, as we see it is this : " 
 
 Here the President presented his fourteen points or condi- 
 tions for the termination of the war, and continuing said : 
 
 " We have spoken now, surely, in terms too concrete to admit 
 of any further doubt or question. An evident principle runs 
 through the whole program I have outlined. It is the principle 
 of justice to all peoples and nationalities, and their right to live 
 on equal terms of liberty and safety with one another, whether 
 they be strong or weak. Unless this principle be made its 
 foundation no part of the structure of international justice can 
 stand. The people of the United States could act upon no other 
 principle ; and to the vindication of this principle they are ready 
 to devote their lives, their honor, and everything that they 
 possess. The moral climax of this the culminating and final 
 war for human liberty has come, and they are ready to put 
 their own strength, their own highest purpose, their own in- 
 tegrity and devotion to the test." 
 
 Not alone President Wilson but members of his Cabinet and 
 other patriots also impressed upon the thoughts of the people 
 that the one great outstanding object of the war was in behalf 
 of threatened democracy. " We are fighting Germany because 
 in this war feudalism is making its last stand against oncoming 
 democracy," said Secretary Lane of the Interior in a speech be- 
 fore the Home Club of the Department of the Interior in Wash- 
 ington on June 4, 1917. " We see it now. This is a war against 
 an old spirit, an ancient, outworn spirit. It is a war against 
 feudalism the right of the castle on the hill to rule the village
 
 THE WORLD WAR AND DEMOCRACY 13 
 
 below. It is a war for democracy the right of all to be their 
 own masters. Let Germany be feudal if she will, but she must 
 not spread her system over a world that has outgrown it. Feu- 
 dalism plus science, thirteenth century plus twentieth, this is 
 the religion of the mistaken Germany that has linked itself with 
 the Turk, that has, too, adopted the method of Mahomet 
 ' The State has no conscience ' ; ' The State can do no 
 wrong ! ' '
 
 CHAPTER II 
 
 DEMOCRACY AND THE AMERICAN WORKINGMAN 
 
 A CLEAR conception of the American workingman and 
 of his environmental conditions must be had if we are to 
 understand the effect upon him of the appeals in which the war 
 against the Imperial German Government was represented as 
 being a continuation of America's traditional struggle for 
 democracy. 
 
 This workingman is not a product of nor is he encompassed 
 about by the environment of the large city. The typical 
 American workingman lives in the smaller cities those with 
 a population of 200,000 and less. He has either been born 
 there or has moved into it from his nearby birthplace in some 
 still smaller town or village or probably from the farm. He 
 has not traveled much nor far from his place of birth. Census 
 statistics show that fifty-seven out of every one hundred of our 
 urban population are born in the State of their residence, only 
 nineteen out of every one hundred in some other State and 
 many of these nearby in adjoining States, and twenty-three in 
 some foreign country. It may be that the parents of this typi- 
 cal workingman were born in Germany or England or Ireland 
 or Scotland or one of the Scandinavian countries but as a rule 
 he himself is native to the soil of the State in which he resides; 
 or if, as in some instances, he himself is among those born 
 abroad he immigrated with his parents at an age too young 
 to have retained impressions of his foreign place of birth strong 
 enough to make him very much different from the native work- 
 ingman alongside of whom he is employed. 
 
 Although of poor parentage and poor himself, economically, 
 either he has attended or his children are at present attending 
 
 14
 
 DEMOCRACY AND THE WORKINGMAN 15 
 
 the public school. Neither he nor his children progress so far 
 as graduation, leaving about the thirteenth or fourteenth year 
 of age " to go to work " to assist the family income. But 
 even with his meager schooling he is usually able to read and 
 write and, what is of greater importance, the influence of the 
 democracy of the public school has brought his mind in touch 
 with has not left him in complete ignorance of the out- 
 standing events of American history. It has brought into the 
 family life words and phrases from the sayings and teachings 
 of the school histories as to the Declaration of Independence, 
 the Revolutionary War, the Constitution of the United States, 
 the Emancipation Proclamation, Lincoln's Gettysburg address, 
 and of speeches of other great men with regard to the preceding 
 eras of America's struggles to establish political, religious, 
 educational, and social democracy. 
 
 Of course the American workingman does not understand 
 all these in their details and as to every phase of their signifi- 
 cance and refinement of understanding, but he can grasp in 
 broad outline the meaning of the striving of the American 
 people ' for political and civil liberty and freedom and inde- 
 pendence from autocratic government. He is assisted in this 
 by the public observance of Washington's and Lincoln's Birth- 
 days, Independence Day and Memorial or Decoration Day, the 
 celebration of which are nearly always accompanied by the 
 reading of some historical document and the delivery of a 
 patriotic address by some local celebrity. That all this has 
 substance and is not mere words is supported by the fact that 
 in many a workingman's humble home will be found hung on 
 the walls a newspaper supplement reproduction of the likeness 
 of Washington or Lincoln or Roosevelt, and not infrequently 
 similar evidence of some great historical event, such as the 
 Declaration of In4ependence, or of Lincoln's Gettysburg ad- 
 dress, or the Stars and Stripes ornamenting one of America's 
 patriotic songs. The worker is also brought into contact with 
 the principles of political democracy by the broad social en- 
 vironment of his immediate neighborhood, such as his exercise
 
 i6 
 
 of the duties of citizenship, in his relation to the political parties, 
 as a member of some religious denomination, and through the 
 town meeting, public lectures, and the like. 
 
 This is not the picture of the American workingman found 
 portrayed in the minds of those who are readers of the accounts 
 of labor disturbances as reported in the large city newspaper, 
 or who conceive of this workingman as a dweller in our larger 
 cities and concentrated industrial centers. Instead, these have 
 the picture of an ignorant and a discontented worker led by self- 
 seeking, radical agitators who are striving for the overthrow 
 of orderly government and whose whole concern is the stirring 
 up of trouble and antagonisms between the worker and his 
 employer a picture of a lawless participant in strikes and 
 lockouts and their accompanying disorders and disturbance of 
 the peace. This particular city worker does exist, usually con- 
 centrated near his place of employment in large numbers in the 
 poorer and unsanitary " slum " section. Generally he is of 
 foreign birth and has only recently arrived in the United States 
 from Italy, Russia or Austro-Hungary, or possibly a few years 
 earlier from Ireland, Germany, England or the Scandinavian 
 countries. His environmental conditions, both those before he 
 immigrated and those he has been forced to live under since 
 his arrival in America, have not been such as to bring him into 
 sufficiently close contact with the influences of democracy so as 
 to imbue him with loyalty to those principles which punctuate 
 America's historic struggles as a nation. But this foreign-born 
 worker, in the United States, although in the aggregate num- 
 bering more than ten million, is not the typical American work- 
 ingman. 
 
 The point it is desired to stress without going too much into 
 detail in identifying this workingman is that his surroundings 
 have been and are such as to make him receptive to expressions 
 of ideas that have to do with rights and justice and liberty 
 and freedom and independence and self-government and democ- 
 racy. This mental receptivity and these concepts had received 
 expression from him, long before the war against Germany, in
 
 DEMOCRACY AND THE WORKINGMAN 17 
 
 the formation of the labor union for securing and protecting 
 his industrial " rights." Not all American workingmen, it is 
 true, are members of the trade or labor union but millions of 
 them are. In ever-growing numbers, accompanying the rapid 
 development in the United States since the early eighties of the 
 last century of concentrated and monopolized production, they 
 have been organizing to such an extent that at the outbreak of 
 the European war there were in existence about one hundred 
 and twenty national and international unions (the latter usually 
 including also workers in Canada) and eight hundred and 
 eighty-four federal unions, with their thousands of State, dis- 
 trict, city, and local unions comprising a membership in excess 
 of 4,500,000. All these unions, with the exception of the four 
 railroad brotherhoods whose members are engaged in the opera- 
 tion of trains, had become federated in the American Federation 
 of Labor. 
 
 This is a movement of native workers primarily, and into these 
 organizations the mass of workingmen have instilled the very es- 
 sence of the principles of representative government the in- 
 strument of political democracy. Their membership generally 
 includes without discrimination all workers engaged in a particu- 
 lar craft or trade, although organization by industry rather than 
 by occupation has shown the stronger tendency in recent years. 
 The officers are elected annually by majority vote of members 
 in good standing, and are retained in power upon representative 
 principles. In the final analysis the determination of all ques- 
 tions of principles and policies is in the hands of the rank and 
 file. Though managing or directing authority is necessarily 
 delegated to administrative officials and committees, it is only 
 for a short period of time. All power rests with the members 
 in their collective capacity. To them every great issue affect- 
 ing the objects and purposes for which they are organized is 
 referred sooner or later for final decision. Every union holds 
 a national convention, usually once a year, but in some cases 
 only every two years, to which delegates are elected by the 
 locals upon a proportional representative basis, that is, one dele-
 
 i8 THE WORKERS AT WAR 
 
 gate is elected for every one hundred or two hundred and so 
 on as the case may be, of fully paid-up members. This na- 
 tional convention is the supreme legislative authority of the 
 organization it can even change or amend the union's con- 
 stitution. On the question of a strike the suspension of 
 employment until specified grievances are remedied or demands 
 granted most unions provide for a vote of the individual 
 membership by means of a secret ballot; others vest the au- 
 thority to call a strike with the executive committee or board. 
 
 Not all labor unions have the same constitution, or the same 
 kind of an organization in details, but most of them employ 
 the same methods for attaining their objects. While the formal 
 expression of principles and the character of organization 
 differ, as do those of different churches in the formulation and 
 expression of their religious belief, all labor unions are working 
 towards the same identical end just as all religions aim for the 
 same goal. And this end the fundamental object of the 
 existence of the labor union is to secure to the American 
 workingman individual fights and economic justice in the pro- 
 duction, distribution, and consumption of wealth : in brief, the 
 end is the establishment of industrial democracy. 
 
 Although this purpose is expressed differently by different 
 unions it usually takes the form of demands for wages high 
 enough to enable the worker to conform to the American stand- 
 ard of living; reasonable hours of employment (usually the 
 eight hour day and the forty-four hour week) ; the Saturday 
 half holiday; observance of well recognized holidays; greater 
 safety to life and limb in hazardous occupations ; better sanitary 
 protection to health ; provision for disability and old age ; pro- 
 hibition of child labor; reasonable guarantee against unem- 
 ployment; regulation of apprentices for the protection of the 
 older and more skilled workers; out-of-work, sickness, and 
 death benefits; weekly payment of wages in lawful money 
 (directed against the system of paying employes in orders on 
 the " company store " and the use of scrip by the employer as 
 money) ; recognition of the labor union by employers ; the
 
 DEMOCRACY AND THE WORKINGMAN 19 
 
 establishing of machinery for joint or collective bargaining 
 between representatives of the employers and the union as to 
 terms and conditions of employment, and so on. 
 
 All these and other specific demands of the workers represent 
 a modern Magna Charta of industrial rights formulated by 
 the toiler in America for the distinct and conscious purpose 
 of establishing for himself and his descendants the inalienable 
 right to the enjoyment of at least a comfortable physical stand- 
 ard of living in return for the service he renders to society in 
 the production of the material necessities of life. It was for 
 this principle for these specific things that the American 
 workingman was fighting in his own country and in a pro- 
 tracted and desperate struggle at the very time of the entrance 
 of the United States as a participant in the European war. 
 This worker knew from hard personal experience all that the 
 denial of these industrial rights meant to him and his family. 
 He knew, too, and also from personal experience, of the damag- 
 ing effects upon his civil and political rights of the principles 
 and practices of industrial feudalism and autocracy in his own 
 native land. 
 
 That this fairly summarizes the situation in our industries 
 generally at the outbreak of the European war is not mere 
 say-so or opinion. It is based upon innumerable, incontro- 
 vertible facts gathered by impartial government commissions 
 of investigation. Let us take the question of wages for illus- 
 tration. Facts in abundance are presented in the report of 
 the commission appointed by the Director General of the 
 United States Railroad Administration immediately upon the 
 National Government taking over the control and operation of 
 the railroads in December, 1917. Demands for increases in 
 wages had been presented to the railway corporations by their 
 employes, and this commission made an investigation of the 
 compensation of persons engaged in railroad service, the rela- 
 tion of railroad wages to wages in other industries, the condi- 
 tions respecting wages in different parts of the country, the 
 special emergency respecting wages which existed at the time
 
 20 THE WORKERS AT WAR 
 
 owing to war conditions and the high cost of living, as well as 
 the relation between different classes of railroad labor. The 
 economic welfare of 2,000,000 workers of 10,000,000 people 
 was involved. The specific question the commission set 
 itself to answer was this: " What does fair dealing at this time 
 require shall be done for these people who are rendering an 
 essential service to the Nation in the practical conduct of this 
 industry ? " 
 
 And here is the commission's answer: 
 
 " It has been a somewhat popular impression that railroad 
 employes were among the most highly paid workers. But 
 figures gathered from the railroads dispose of this belief. 
 Fifty-one per cent, of all employes during December, 1917. 
 received $75 per month or less ; and 80 per cent, received 
 $100 per month or less. Even among the locomotive engineers, 
 commonly spoken of as highly paid, a preponderating number 
 receive less than $170 per month, and this compensation they 
 have attained by the most compact and complete organization, 
 handled with a full appreciation of all strategic values. Be- 
 tween the grades receiving from $150 to $250 per month, there 
 is included less than 3 per cent, of all the employes (ex- 
 cluding officials) and these aggregate less than 60,000 men 
 out of a grand total of 2,000,000. 
 
 " The greatest number of employes on all the roads fall into 
 the class receiving betveen $50 and $65 per month, 181,693, 
 while within the range of the next ten dollars in monthly salary 
 there is a total of 312,761 persons. In December, 1917, there 
 were 111,477 clerks receiving annual pay of $900 or less. In 
 1917 the average pay of this class was but $56.77 per month. 
 There were 270,855 section men whose average pay as a class 
 was $50.31 per month ; 121,000 other unskilled laborers, whose 
 average pay was $58.25 per month; 130,075 station service 
 employes, whose average pay was $58.57 per month ; 75,325 
 road freight brakemen and flagmen, whose average pay was 
 $100.17 per month; and 16,455 road passenger brakemen and 
 flagmen, whose average pay was $91.10 per month. 
 
 " These, it is to be noted, are not prewar figures ; they repre- 
 sent conditions after a year of war and two years of rising 
 prices. And each dollar now represents in its power to pur- 
 chase a place in which to live, food to eat, and clothing to wear, 
 but 71 cents as against the 100 cents of January i, 1916."
 
 DEMOCRACY AND THE WORKINGMAN 21 
 
 So much for the question of wages. How about hours of 
 work and other conditions and terms of employment? 
 
 With the American workingman a standard working day 
 of reasonably limited length that will not overtax the physical 
 strength of the worker is as much a part of industrial justice 
 as is his conception of and insistence upon a wage that will 
 supply himself and his family with the necessaries and some 
 of the comforts of living. In not a few industries he has suc- 
 ceeded, only through years of struggle and by means of the 
 power of organization, however, in establishing the eight hour 
 day as the standard, receiving overtime payment in emergencies 
 requiring longer hours. But in many industries longer hours 
 than eight a day is the practice. 
 
 To establish the eight hour day among the 70,000 men em- 
 ployed in the lumber industry of the Pacific Northwest a strike 
 was declared in that industry just prior to our entrance into 
 the European war. It was virtually the only industry on the 
 Pacific coast in which this standard of working hours did not 
 prevail. The employers opposed the movement with all the 
 power at their command, even to the extent of binding them- 
 selves by an agreement to discriminate against all mills intro- 
 ducing the eight hour day. The men had gone out on strike 
 early in the summer of 1917 but were defeated, with ensuing 
 unrest and dissatisfaction and smouldering hatreds which are 
 never conducive to personal efficiency or cooperative plant 
 production. 
 
 The living and working conditions of the men in the lumber 
 industry were anti-social and even uneconomic from the em- 
 ployers' point of view, the unlivable conditions of many of the 
 lumber camps being inconceivable to any liberty loving Ameri- 
 can who had not actually seen them. Abuses affecting the 
 individual health as well as the personal well being of the 
 workers were widespread. Intermittent employment was 
 general, as reflected in the fact that the turn-over of labor each 
 year in the industry was as high as 600 per cent. Largely 
 because of the working conditions surrounding their employ-
 
 22 THE WORKERS AT WAR 
 
 ment nine out of every ten workers were " womanless, vote- 
 less, and jobless." A little imaginative interpretation of this 
 quotation pictures a man wholly free from the very essentials 
 of good citizenship his conditions of employment do not fit 
 him to take his place in a democracy. 
 
 These employers bitterly opposed any and all efforts to or- 
 ganize the men into unions and this attitude, in the words of 
 the President's Mediation Commission, " has reaped for them 
 an organization of destructive rather than constructive radical- 
 ism. The I. W. W. (Industrial Workers of the World) is 
 filling the vacuum created by the operators. The red card is 
 carried by large numbers throughout the Pacific Northwest. . . . 
 The hold of the I. W. W. is riveted instead of weakened by 
 unimaginative opposition on the part of employers to the cor- 
 rection of real grievances." 
 
 It was the absence of the practice of principles of industrial 
 democracy as well as its counterpart the presence of autoc- 
 racy that was also largely responsible for unrest in the Chi- 
 cago meat packing industry. There the very essence of 
 industrial democracy machinery for joint bargaining between 
 representatives of employes and employers as to terms and 
 conditions of employment was lacking. " The chief source 
 of trouble comes from lack of solidarity and want of power 
 on the part of the workers to secure redress of grievances 
 because of the systematic opposition on the part of the packers 
 against the organization of its workers," says the report of the 
 President's Mediation Commission. " The strike of 1903 de- 
 stroyed the union, and for fourteen years the organization of 
 the yards has been successfully resisted. In 1917 effective or- 
 ganization again made itself felt, so that by the end of the year 
 a sizable minority, variously estimated from 25 to 50 per cent., 
 was unionized." In December of 1917 a strike radiating out 
 from Chicago threatened the meat-packing industry of the en- 
 tire country. The issues affected upward of 100,000 men. 
 
 " It is a commonplace of trade union experience that an 
 organized compact minority can control the labor situation in
 
 DEMOCRACY AND THE WORKINGMAN 23 
 
 an industry. The union leaders felt, and rightly felt, therefore, 
 that their demands had the effective backing of a potential 
 strike. More important than any of the specific grievances, 
 however, was the natural desire to assert the power of the 
 union by asking the packers for union recognition, at least to 
 the extent of a meeting between the packers and the repre- 
 sentatives of the union. This the packers refused to do. They 
 refused to meet eye to eye with the union leaders because of 
 distrust of those leaders." x 
 
 Aside from the question of recognition of the union the two 
 specific grievances involved were low wages and long hours. 
 Two wage increases had been granted during 1917, largely in 
 an endeavor to forestall union activity, but even with these 
 increases the wage scales, particularly for the great majority 
 of the unskilled workers, were inadequate in contrast with the 
 increased cost of living. The belief on the part of the employes 
 that the companies had been making excessive profits notwith- 
 standing Government regulation of the prices of meats and 
 other packing house products also influenced the workers in 
 demanding higher wages. 
 
 The Pacific Coast telephone dispute also involved recognition 
 by the employers of the principal instrumentality of industrial 
 democracy the organization of the employes. Because of 
 failure in this direction a tie-up of the telephone system of the 
 entire Pacific Coast was threatened for several months, which 
 would have affected a vast net-work of industry stretching 
 over a wide territory in California, Oregon, Washington, Idaho, 
 and Nevada. The strike actually did become effective in 
 Washington and Oregon in November, 1917. 
 
 The particular phase of union recognition involved in the 
 telephone strike was that of girl employes of the corporation. 
 There was already in existence a union of the electrical me- 
 chanics of the company and with this organization the com- 
 pany's officials had entered into collective bargaining agree- 
 ments. With this union of the men the nine thousand girl 
 
 1 Report of the President's Mediation Commission.
 
 24 THE WORKERS AT WAR 
 
 employes, principally operators, desired to affiliate. The union 
 men employes supported this demand of the girls. It was 
 the refusal by the officials of the telephone company to permit 
 its girl employes to affiliate with the men's union that pre- 
 cipitated the issue and culminated in the strike that partly tied 
 up the service. There was also a demand for an increase in 
 wages to the men employes as these wages had remained sta- 
 tionary since 1913 while the cost of living had greatly increased. 
 A demand for a closed shop, by which only members of the 
 union would be employed by the company, was later modified 
 into the expression of a desire for a preferential shop. 
 
 In the California oil fields the specific demands of unionized 
 employes in 1917 were for an eight-hour day and a minimum 
 daily wage of four dollars, while at the same time complaint 
 was made against discrimination in employment by employers 
 because of union membership. About 18,000 men, English- 
 speaking and nearly all Americans, a large proportion highly 
 skilled, were affected. The union had about 10,000 members. 
 These men produced from the oil fields of southern California 
 about 8,000,000 barrels of oil a month one-third of the total 
 oil production of the country. Ownership of almost the entire 
 output is concentrated in the monopoly control of eleven cor- 
 porations. 
 
 These illustrations from the railway, lumber, meat packing, 
 telephone, and oil producing industries call attention to specific 
 issues of industrial democracy involved in labor controversies 
 which the American workingman through his union was fight- 
 ing to secure. But just as the war " to make the world safe for 
 democracy " had to be fought against specific practices of 
 political autocracy as represented in the Imperial German Gov- 
 ernment that should be utterly annihilated from the face of the 
 earth, so the American workingman in order to secure industrial 
 democracy at home found himself fighting against the practices 
 of industrial autocracy of employers in his own country. Not 
 only was he fighting for something that was worth while but 
 he was also fighting against something that had first to be
 
 DEMOCRACY AND THE WORKINGMAN 25 
 
 destroyed or made ineffective before his rights could be secured 
 and made secure. He was being denied the enjoyment of the 
 very things that gave to democracy its real meaning. The 
 American workingman had 'been experiencing for years not 
 only the injurious effects of the refusal of autocracy in industry 
 to grant to him his industrial rights but he was also the victim 
 of innumerable acts on the part of representatives of this autoc- 
 racy that resulted in actually depriving him of his guaranteed 
 civil and political rights. Two instances of these overt acts 
 occurred early in the beginning of the European war. One is 
 known as the " Mooney Case " and the other as the " Bisbee 
 Deportations."
 
 CHAPTER III 
 
 INDUSTRIAL AUTOCRACY AND THE WORKERS 
 
 WHILE a preparedness parade was in early progress in 
 San Francisco on July 22, 1916, an explosion occurred 
 in one of the city's side streets rilled with the paraders and the 
 public which resulted in six people being killed outright and 
 some forty injured, of which latter four subsequently died. 
 '* Without question the explosion was murder designed on a 
 large scale," says the report of President Wilson's Mediation 
 Commission which was directed some months later * to make 
 an investigation of the facts, " and indisputably a most heinous 
 crime had been committed." Subsequent developments lead- 
 ing to identification of the perpetrators resulted in the arrest of 
 four men and one woman, and later in the conviction of a youth 
 named Billings and Thomas J. Mooney, the latter on the charge 
 of murder in the first degree. Billings was sentenced to the 
 penitentiary for life and Mooney to be hanged. 
 
 The significance of this lies in the fact that Mooney was a 
 prominent labor leader of the more radical workers on the 
 Pacific Coast. His reputation was that of an associate of pro- 
 fessed anarchists, a believer in " direct action " as the remedy 
 of the workers' grievances, and he had once before been in- 
 dicted, although acquitted after three trials, on the charge of 
 attempting to dynamite the property of a public utility corpora- 
 tion of San Francisco. He had led an unsuccessful attempt 
 in 1916 to organize the employes of the United Railroads 
 of that city. In these and other ways Mooney had secured 
 the bitter and determined antagonism of the employers in San 
 
 1 The Commission reported to the President under date of January 
 16, 1918. 
 
 26
 
 INDUSTRIAL AUTOCRACY AND WORKERS 27 
 
 Francisco and it was through the efforts of detectives of these 
 employers that Mooney was arrested and charged with the 
 dynamiting crime. It was on evidence submitted by these 
 detectives, which later was brought into serious doubt as to its 
 reliability, that Mooney was convicted. 
 
 Instead of a case of simple justice before the court for the 
 sifting of evidence and the ascertainment beyond a question of 
 a doubt of the guilt or innocence of the accused, the Mooney 
 case became a cause of increasing widespread unrest and agita- 
 tion among the workers and of growing hostility between 
 employes and employers, not only on the Pacific Coast but also 
 throughout the greater part of the country. Mass meetings 
 and public parades of protest over his conviction were held by 
 the workers and their sympathizers and petitions and demands 
 for a new trial poured into the courts, the legislature, and the 
 governor of California and even into Congress and the Presi- 
 dent of the United States. " Just as Mooney symbolized labor 
 for all the bitter opponents of organized labor," says the Com- 
 mission's report, " so he came to symbolize labor, irrespective 
 of his persona! merits, in the minds of workers and of their 
 sympathizers. The 'Mooney case' soon resolved itself into a 
 new aspect of an old industrial feud." It even grew into a 
 question of international importance through meetings of work- 
 ers in Russia declaring in resolutions that the professions of 
 the United States in behalf of world democracy would have 
 more influence with the Russians if the Government of the 
 United States insisted upon democracy at home. The public 
 generally v came to believe that because of the circumstances 
 surrounding Mooney's prosecution and conviction, and espe- 
 cially because of his prominence as a labor leader, " the terrible 
 and sacred instruments of criminal justice were consciously or 
 unconsciously made use of against labor by its enemies in an 
 industrial conflict." The Commission further said : " The feel- 
 ing of disquietude aroused by the case must be heeded, for if 
 unchecked, it impairs the faith that our democracy protects the 
 lowliest and even the unworthy against false accusations. War
 
 28 . THE WORKERS AT WAR 
 
 is fought with moral as well as material resources. We are 
 in this war to vindicate the moral claims of unstained processes 
 of law, however slow at times, such processes may be. These 
 claims must be tempered by the fire of our own devotion to 
 them at home." 
 
 The " Bisbee Deportation," also reported upon by the Presi- 
 dent's Mediation Commission, is another illustration of the 
 practices of industrial autocracy in America. It was a conse- 
 quence of a strike in June, 1917, in the copper mining districts 
 of Arizona, which produce about one-fourth of the entire cop- 
 per output of the United States. The principal demands of the 
 employes are stated as follows in the report of the Commission : 
 
 " While not expressed in so many words, the dominant feel- 
 ing of protest was that the industry was conducted upon an 
 autocratic basis. The workers did not have representation in 
 determining those conditions of their employment which vitally 
 affected their lives as well as the company's output. Many 
 complaints were, in fact, found by the commission to be un- 
 founded, but there was no safeguard against injustice except 
 the say-so of one side to the controversy. In none of the 
 mines was there direct dealing between companies and unions. 
 In some mines grievance committees had been recently estab- 
 lished, but they were distrusted by the workers as subject to 
 company control, and, in any event, were not effective, because 
 the final determination of every issue was left with the com- 
 pany. In place of orderly processes of adjustment workers 
 were given the alternative of submission or strike. 
 
 " The men sought the power to secure industrial justice in 
 matters of vital concern to them. The power they sought 
 would in no way impinge on the correlative power which must 
 reside in management. Only by a proper balance of adequate 
 power on each side can just equilibrjum in industry be attained. 
 In the minds of the workers only the right to organize secured 
 them an equality of bargaining power and protection against 
 abuses. There was no demand for a closed shop. There was 
 a demand for security against discrimination directed at union 
 membership. The companies denied discrimination, but re- 
 fused to put the denial to the reasonable test of disinterested 
 adjustment. 
 
 "The men demanded the removal of certain existing griev-
 
 INDUSTRIAL AUTOCRACY AND WORKERS 29 
 
 ances as to wages, hours, and working conditions, but the spe- 
 cific grievances were, on the whole, of relatively minor impor- 
 tance. The crux of the conflict was the insistence of the men 
 that the right and the power to obtain just treatment were in 
 themselves basic conditions of employment, and that they should 
 not be compelled to depend for just treatment on the benevo- 
 lence or uncontrolled will of the employers." 
 
 On July 12, 1917, within less than three weeks from the call- 
 ing of the strike, occurred the forcible deportation of striking 
 employes from the Warren district to a point outside the State 
 of Arizona which startled into indignation the feeling of justice 
 and of liberty of the American people. Briefly the facts are 
 these: The sheriff of Cochise county, in which is located the 
 mining town of Bisbee, had requested, through the Governor of 
 the State, the despatching of federal troops to preserve order, 
 the State militia having previously been drafted into federal 
 service. But upon separate investigations on two different 
 occasions by a representative of the War Department the situa- 
 tion was found so peaceful as not to justify the presence of 
 troops. Says the report of the President's Mediation Com- 
 mission : 
 
 " Early in the morning of July 12, the sheriff and a large 
 armed force presuming to act as deputies under the sheriff's 
 authority, comprising about 2,000 men, rounded up 1,186 men 
 in the Warren district, put them aboard a train, and carried 
 them to Columbus, New Mexico. The authorities at Colum- 
 bus refused to permit those in charge of the deportation to leave 
 the men there, and the train carried them back to the desert 
 town of Hermanas, New Mexico, a nearby station. The de- 
 portees were wholly without adequate supply of food and water 
 and shelter for two days. At Hermanas the deported men were 
 abandoned by the guards who had brought them and they were 
 left to shift for themselves. The situation was brought to the 
 attention of the War Department, and on July 14 the deportees 
 were escorted by troops to Columbus, New Mexico, where they 
 were maintained by the Government until the middle of Sep- 
 tember. 
 
 " According to an Army census, of the deported men 199 
 were native-born Americans, 468 were citizens, 472 were regis-
 
 30 THE WORKERS AT WAR 
 
 tered under the selective-draft law, and 433 were married. Of 
 the foreign-born, over twenty nationalities were represented, 
 including 141 British, 82 Serbians, and 179 Slavs. Germans 
 and Austro-Hungarians (other than Slavs) were comparatively 
 few. 
 
 "The deportation was carried out under the sheriff of Cochise 
 county. It was formally decided upon at a meeting of citizens 
 on the night of July II, participated in by the managers and 
 other officials of the Copper Queen Consolidated Mining Com- 
 pany ( Phelps-Dodge Corporation, Copper Queen division) and 
 the Calumet and Arizona Mining Company. Those who 
 planned and directed the deportation purposely abstained from 
 consulting about their plans either with the United States attor- 
 ney in Arizona, or the law officers of the State or county or 
 their own legal advisers. 
 
 " In order to carry out the plans for the deportation into 
 successful execution, the leaders in the enterprise utilized the 
 local offices of the Bell Telephone Company, and exercised or 
 attempted to exercise a censorship over parts of interstate con- 
 nections of both the telephone and telegraph lines in order to 
 prevent any knowledge of the deportation reaching the outside 
 world. 
 
 " The deportation was wholly illegal and without authority 
 in law either State or Federal. 
 
 " Following the deportation of the twelfth, in the language of 
 Governor Campbell of Arizona, 'the constitutional rights of 
 citizens and others have been ignored by processes not provided 
 by law, viz. : by deputy sheriffs who refused persons admittance 
 into the district and the passing of judgment by a tribunal 
 without legal jurisdiction resulting in further deportations.' 
 
 " Immediately after the first deportation, and until late in 
 August, the function of the local judiciary was usurped by a 
 body which to all intents and purposes was a vigilance commit- 
 tee, having no authority whatever in law. It caused the de- 
 portation of large numbers of others. So far as this committee 
 is concerned, its activities were abandoned at the request of the 
 Governor of Arizona late in August. 
 
 " Among those who were deported from the district and 
 who thereafter were arrested in seeking entrance into it were 
 several who were registered under the selective-draft law and 
 sought to return or remain in the district in order to discharge 
 their legal duty of reporting for physical examination under the 
 draft."
 
 INDUSTRIAL AUTOCRACY AND WORKERS 31 
 
 The American workingman had reason to know that Prus- 
 sianism was not operating in the German Empire alone or, 
 since the beginning of the war, in Belgium and France alone. 
 He saw it entrenched in almost impregnable strongholds in 
 many industries in the United States. He recognized it even 
 in its many disguises. The autocracy of the " Bisbee Deporta- 
 tions " served to add fuel to the flames raging over the con- 
 troversy in the " Mooney Case," which was then at its height, 
 and together these aroused in the labor world such a storm of 
 protest as was probably never before experienced in the history 
 of this country. No German Kaiser or Russian Czar, even at 
 the summit of his exercise of autocratic power, ever attempted 
 a greater usurpation of the exercise of sovereignty. 
 
 The personal experience of the American workingman en- 
 gaged in industrial pursuits in mine and mill and factory and 
 plant over a period of years preceding the beginning of the 
 European war, and especially after the development of control 
 of industry by the corporation since the eighties, has been 
 such as to make him acquainted in a very intimate way with 
 the effects of the exercise of autocratic power. He had for 
 years been denied the right to have anything to say as to the 
 amount of the money wages he was to receive for the work he 
 performed, or even as to the form in which he received these 
 wages, not infrequently being paid in " orders " on the 
 " company " store. He had been denied participation in deter- 
 mining how many hours a day he must work for those wages. 
 In brief, all the conditions of employment under which he 
 labored for a livelihood had been determined arbitrarily and 
 autocratically by the employer. And when the exactions of 
 the employing class became unbearable and the workingman 
 attempted to organize with other workmen in a union for 
 their mutual protection, he was denied even this right of asso- 
 ciation. 
 
 The American workingman, then, knew autocracy, and he 
 could recognize its acts when he saw them committed, whether 
 these commissions were by the German Government in sinking
 
 32 THE WORKERS AT WAR 
 
 American vessels on the high seas or by the industrial corpora- 
 tion engaged in the forcible deportation of American citizens 
 who had gone on strike for their industrial rights. And it 
 so happened that the American workingman was engaged in a 
 struggle against the exercise of its autocratic powers by the 
 corporation within the United States at the very time he was 
 being called upon by the President of the United States to 
 fight autocracy in Europe as represented by the acts of the 
 German Government. 
 
 This is why it is that the appeals of President Wilson, in 
 which he personified the war against the Imperial German 
 Government merely as another phase of the age-long warfare 
 in behalf of democracy, struck a responsive chord in the mind 
 and heart of the American workingman. The President's 
 terms were familiar terms, whether they were those denouncing 
 autocratic acts and usurpations or those that belonged to the 
 vocabulary of democracy ; and the American workingman could 
 understand their meaning. They sank deep into his inner 
 consciousness and moved the springs of his action. They 
 enlisted him whole-heartedly in America's cause and they 
 bound him irrevocably to the successful prosecution of the 
 war. And in this one thing in welding to the prosecution of 
 the war the enthusiastic support of the workingmen of America 
 more than by any other single line of conduct President 
 Wilson assured the winning of the war. For without this 
 whole-hearted support of the American workingman the war 
 could not have been won for democracy. 
 
 President Wilson did more, however, than merely point out 
 the close relation between the objects of democracy and the 
 purpose of the American people in the war. He linked with 
 the latter the struggle the American workingman himself was 
 making in his own country against anti-democratic tendencies 
 in his own sphere of daily existence. Not only did the Presi- 
 dent link these separate struggles as one directed towards iden- 
 tical ends but he also signified his support of the one as of the 
 other. Addressing the Labor Committee of the Council of
 
 INDUSTRIAL AUTOCRACY AND WORKERS 33 
 
 National Defense at the White House on May 15, 1917, the 
 President said: 
 
 " I have been very much alarmed at one or two things that 
 have happened, at the apparent inclination of the legislatures of 
 one or two of our States to set aside even temporarily the laws 
 which have safeguarded the standards of labor and of life. I 
 think nothing would be more deplorable than that. We are 
 trying to fight in a cause which means the lifting of the stand- 
 ards of life, and we can fight in that cause best by voluntary 
 cooperation. I do not doubt that any body of men representing 
 labor in this country, speaking for their fellows, will be willing 
 to make any sacrifice that is necessary in order to carry this 
 contest to a successful issue, and in that confidence I feel that 
 it would be inexcusable if we deprived men and women of such 
 a spirit of any of the existing safeguards of law. Therefore, I 
 shall exercise my influence as far as it goes to see that that 
 does not happen and that the sacrifices we make shall be made 
 voluntarily and not under the compulsion which mistakenly is 
 interpreted to mean a lowering of the standards which we have 
 sought through so many generations to bring to their present 
 level." 
 
 In reply to an invitation from Chairman Samuel Gompers 
 of the American Alliance for Labor and Democracy to attend 
 a conference of that organization at Minneapolis, President 
 Wilson under date of August 31, 1917, among other things, 
 said: 
 
 " I myself have had sympathy with the fears of the workers 
 of the United States, for the tendency of war is toward re- 
 action, and too often military necessities have been made an 
 excuse for the destruction of laboriously erected industrial 
 and social standards. These fears, happily, have proved to be 
 baseless. With quickened sympathies and appreciation, with a 
 new sense of the invasive and insidious dangers of oppression, 
 our people have not only held every inch of ground that has 
 been won by years of struggle, but have added to the gains of 
 the twentieth century along every line of human betterment. 
 Questions of wages and hours of labor and industrial readjust- 
 ments have found a solution which gives to the toiler a new 
 dignity and a new sense of social and economic security. I
 
 34 THE WORKERS AT WAR 
 
 beg you to feel that my support has not been lacking and that 
 the Government has not failed at any .point in granting every 
 just request advanced by you and your associates in the name 
 of the American worker. 
 
 " No one who is not blind can fail to see that the battle line 
 of democracy for America stretches today from the fields of 
 Flanders to every house and workshop where toiling, upward- 
 striving men and women are counting the treasures of right 
 and justice and liberty which are being threatened by our pres- 
 ent enemies." 
 
 Finally in an address before the American Federation of 
 Labor in its annual convention at Buffalo on November 12, 
 1917, the President, among other things, said: 
 
 " While we are fighting for freedom we must see, among 
 other things, that labor is free, and that means a number of 
 interesting things. It means not only that we must do what 
 we have declared our purpose to do, see that the conditions 
 of labor are not rendered more onerous by the war, but also 
 that we shall see to it that the instrumentalities by which the 
 conditions of labor are improved, are not blocked or checked. 
 That we must do."
 
 CHAPTER IV 
 
 THE WORKERS AND THE WORLD WAR 
 
 V 
 
 ALL the public professions of faith in the principles of 
 democracy by the Wilson Administration were put to the 
 acid test in the formulation of the principles to govern the 
 selection of the men from among the body of citizens who 
 were to serve in , the military forces. And it met this test 
 admirably. Probably no other single official act was more 
 responsible in solidifying labor in support of the war. The 
 Selective Service Act had this effect to an incalculable degree. 
 It breathed the principles of democracy in every line and in 
 every section of its provisions. 
 
 Approved by the President on May 16, 1917, this Act pro- 
 vided that all male persons between the ages of twenty-one and 
 thirty, both inclusive, were subject to registration. The day 
 of registration was set by Presidential proclamation for June 5. 
 From the ten million names so registered were selected, by the 
 drawing of numbers as in a lottery, the men who made up the first 
 draft of the National Army. The official drawing of numbers 
 took place on Friday, July 20, 1917, in the Office Building of 
 the United States Senate in the National Capital. Distin- 
 guished citizens were present, including the Secretary of War, 
 officers of high rank in the Army, Senators, and Representa- 
 tives. The numbers, encased in capsules, were drawn by two 
 blindfolded men. Prior to the drawing of the first number 
 Secretary of War Baker said : " We are met to conduct a 
 lottery or draft by which the National Army and such additions 
 as may be necessary to bring the Regular Army and National 
 Guard to war strength are to be selected. This is an occasion 
 of very great dignity and some solemnity. It represents the 
 first application of the principles believed by many of us to be 
 
 35
 
 36 
 
 fairly democratic, equal, and fair in selecting soldiers to defend 
 the national honor abroad and at home." The first number 
 drawn was 258. The drawing proceeded without interruption 
 at the rate of 600 an hour, and a total of twenty-two hours 
 was consumed in the task. After the numbers were drawn and 
 assigned to the individuals, those thus selected had an oppor- 
 tunity to present claims for exemption, exclusion, or discharge 
 from the draft and to support such claims by evidence. Thus 
 all unfairness and injustice was removed as between the rich 
 and the poor man in the registration and the final selection for 
 war service. 
 
 Of particular significance in this connection is Section 3 of 
 the Act. It provided that : " No bounty shall be paid to induce 
 any person to enlist in the military service of the United States ; 
 and no person liable to military service shall hereafter be per- 
 mitted or allowed to furnish a substitute for such service; nor 
 shall any substitute be received, enlisted, or enrolled in the 
 military service of the United States ; and no such person shall 
 be permitted to escape such service or to be discharged there- 
 from prior to the expiration of his term of service by the pay- 
 ment of money or any other valuable thing whatsoever as con- 
 sideration for his release from military service or liability 
 thereto." For the purpose of determining exemption from 
 military service, 1 the act provided for the establishment of 
 
 1 The Selective Service Act provided for exemption as follows : 
 " That the Vice President of the United States, the officers, legislative, 
 executive, and judicial, of the United States and of the several States, 
 Territories, and the District of Columbia, regular or duly ordained 
 ministers of religion, students who at the time of the approval of this 
 act are preparing for the ministry in recognized theological or divinity 
 schools, and all persons in the military and naval service of the United 
 States shall be exempt from the selective draft herein prescribed; and 
 nothing in this act contained shall be construed to require or compel 
 any person to serve in any of the forces herein provided for who is 
 found to be a member of any well-recognized religious sect or organ- 
 ization at present organized and existing and whose existing creed or 
 principles forbid its members to participate in war in any form and 
 whose religious convictions are against war or participation therein
 
 THE WORKERS AND THE WORLD WAR 37 
 
 Local Boards and District Boards of Appeal. Appeals from 
 the District Boards were to the President of the United States. 
 Another feature of the activities of the National Adminis- 
 tration which appealed in the direction of securing the support 
 of the American workingman in the conduct of the war was the 
 broad and liberal measures taken to facilitate and clear the 
 channels of distribution of commodities, to prevent hoarding, 
 to assure fair prices, to restrain speculation injurious to the 
 public, to prohibit evil practices on exchanges, to protect the 
 people against " corners " in crops, and to prevent extortions of 
 various kinds. Such action was provided for in statutes en- 
 acted by Congress dealing with necessaries of life, such as 
 foods, feeds, shoes, clothing, fuel, and articles required for their 
 production, all these being placed under Government control 
 for the period of the war simply by declaring that every busi- 
 
 in accordance with the creed or principles of said religious organiza- 
 tions, but no person so exempted shall be exempted from service in 
 any capacity that the President shall declare to be noncombatant ; 
 and the President is hereby authorized to exclude or discharge from 
 said selective draft and from the draft under the second paragraph of 
 section one hereof, or to draft for partial military service only from 
 those liable to draft as in this act provided, persons of the following 
 classes: County and municipal officials; custom-house clerks; persons 
 employed by the United States in the transmission of the mail; artificers 
 and workmen employed in the armories, arsenals, and navy-yards of the 
 United States, and such other persons employed in the service of the 
 United States as the President may designate; pilots; mariners actu- 
 ally employed in the sea service of any citizen or merchant within 
 the United States; persons engaged in industries, including agricul- 
 ture, found to be necessary to the maintenance of the Military Estab- 
 lishment or the effective operation of the military forces or the main- 
 tenance of national interest during the emergency ; those in a status 
 with respect to persons dependent upon them for support which renders 
 their exclusion or discharge advisable; and those found to be physically 
 or morally deficient : No exemption or exclusion shall continue when 
 a cause therefor no longer exists: Provided. That notwithstanding the 
 exemptions enumerated herein, each State, Territory, and the District 
 of Columbia, shall be required to supply its quota in the proportion 
 that its population bears to the total population of the United States."
 
 38 THE WORKERS AT WAR 
 
 ness dealing with them was affected with the public interest. 
 Standards for grades of foods, feeds, and seeds were estab- 
 lished and the labeling of such commodities regulated. The 
 manufacture, storage, and distribution of foods, food mate- 
 rials and feeds were licensed and, wherever found necessary, 
 were subjected to Government control. Provision was also 
 made for the regulation of prices, and when these were fixed 
 it was made unlawful for anybody to charge a higher price. 
 
 In these and other ways the Wilson Administration dis- 
 played statesmanship of a high order in accurately sensing the 
 kind of appeal that would secure the unquestioned loyalty of 
 the American workingman in the prosecution of the war. Not 
 only through their local, state, national and international unions 
 and their federated organization the American Federation 
 of Labor did the organized workers of the United States 
 support the Government but they called into existence a sepa- 
 rate organization in order to make their influence even more 
 widely felt, particularly among the unorganized workers. 
 This new organization was the American Alliance for Labor 
 and Democracy. Its purpose is well expressed in its name ; 
 also in resolutions adopted at a mass meeting held under its 
 auspices in New York City on Washington's Birthday in 1918. 
 These resolutions were in part as follows : 
 
 " Whereas the united free peoples of the world are engaged 
 in a great final struggle against autocracy to the end that the 
 boundless opportunities of democracy and freedom may be 
 opened to all humanity ; and 
 
 " Whereas the great struggle of which this world war is the 
 climax, had its beginning on the American Continent under the 
 leadership of the immortal George Washington, to whose 
 memory we pay tribute in this mass meeting on the anniversary 
 of his birth ; and 
 
 " Whereas the American labor movement has stood stead- 
 fastly for the cause of democracy and freedom from the begin- 
 ning of its history, battling against autocracy in every form, 
 against imperialism and militarism and greed, striving always 
 to open the way to greater freedom and new opportunities in 
 enlarged democracy: Be it therefore
 
 THE WORKERS AND THE WORLD WAR 39 
 
 " Resolved by this meeting of trade-unionists and their 
 friends, held under the auspices of the American Alliance for 
 Labor and Democracy, that we once more declare our steadfast 
 loyalty to America's enlightened cause; that we recognize in 
 this great struggle at arms a war that is essentially labor's war 
 a war of the useful people of the world against the agents 
 and institutions of tyranny and oppression and that we are 
 resolved to remain with this struggle to its victorious conclu- 
 sion ; and be it further 
 
 " Resolved, That we commend the determination of the 
 American labor movement to have no contact or dealings with 
 enemy nations so long as those nations remain autocratic, and 
 that we send again to the people of those nations the word that 
 the American working people caa discuss no international or 
 other questions with them so long as they consent to autocratic 
 domination and fight the battles of autocracy ; and be it further 
 
 " Resolved, That we are one with the whole people of 
 America in our resolve to exert every effort for a triumphant 
 military effort on the battlefields of Europe to bring about the 
 final overthrow of autocracy, meanwhile guarding jealously 
 our democratic institutions at home as the foundations of a 
 wider and fuller democracy to come: and be it further 
 
 " Resolved, That we here again express our appreciation of 
 the far-sighted wisdom and singleness of purpose of President 
 Wilson as manifested in his first statement of the aims of our 
 Nation in this war, which statement has furnished a rallying 
 point for the advancing democratic thought of the world ; and 
 be it further 
 
 " Resolved, That we forward this declaration of fidelity and 
 loyalty to the President of the United States as our renewed 
 pledge of fealty and true understanding at this most fitting time, 
 the anniversary of the birth of our first Great Liberator." 
 
 The anniversary of the birth of Lincoln was also made the 
 occasion of nation-wide demonstrations of patriotic duty by the 
 workers. The week of Lincoln's birthday was. observed as 
 Loyalty Week by organized labor in order " the more thor- 
 oughly and effectively to demonstrate our solidarity and our 
 unity in behalf of our Republic." * All local branches of the 
 
 1 Extract from a circular letter issued by the executive council of 
 the American Alliance for Labor and Democracy under date of Jan- 
 uary 4, 1918.
 
 40 THE WORKERS AT WAR 
 
 Alliance, in cooperation with the local bodies of organized 
 labor, held mass meetings and demonstrations and distributed 
 patriotic literature among their fellow workers and citizens 
 setting forth America's aims and ideals with the view of com- 
 bating the insidious forces of pro-German and anti-American 
 propaganda. 
 
 As to the work of this organization President Wilson said 
 in a telegram to its convention held at St. Paul, Minnesota, 
 in June, 1918: 
 
 " Called into being to combat ignorance and misunderstand- 
 ing, skillfully played upon by disloyal influences, the American 
 Alliance for Labor and Democracy has done a great and neces- 
 sary work. It has aided materially in promoting the unity that 
 proceeds from exact understanding, and is today a valid and 
 important part of the great machinery that coordinates the 
 energies of America in the prosecution of a just and righteous 
 war." 
 
 Nor did the President withhold expressions of recognition of 
 the part the labor unions were playing in the war. To Presi- 
 dent Gompers of the American Federation of Labor at its 
 convention in St. Paul in June, 1918, the President sent this 
 telegram : 
 
 " Please convey to the thirty-eighth annual convention of the 
 American Federation of Labor my congratulations upon the 
 patriotic support which the members of your organization have 
 given to the war program of the Nation in the past year not only 
 in the trenches and on the battlefield, where so many of our 
 younger men are now in uniform, but equally in the factories 
 and shipyards and workshops of the country, where the Army 
 is supported and supplied by the loyal industry of your skilled 
 craftsmen. We are facing the hardships of the crucial months 
 of the struggle. The Nation can face them confidently, as- 
 sured now that no intrigues of the enemy can ever divide our 
 unity by means of those industrial quarrels and class dissen- 
 sions which he has tried so diligently to foment. In these days 
 of trial and self-sacrifice the American workingman is bearing 
 his share of the national burden nobly. In the new world of 
 peace and freedom which America is fighting to establish his 
 place will be as honored and his service as gratefully esteemed."
 
 THE WORKERS AND THE WORLD WAR 41 
 
 The service " in the factories and shipyards and workshops " 
 which American labor was called upon to render at the en- 
 trance of the United States as a participant in the war involved 
 the most radical readjustment in its history. While it is true 
 a partial readjustment from the pursuits of peacetime condi- 
 tions to war time requirements had been brought about prior 
 to our participation through the demands of the Allies upon 
 the industries of the United States for war material, at the 
 same time this was only to a very limited extent compared with 
 the almost complete revolution following upon the demands of 
 the American Government for men to fill the ranks of the army 
 and navy as well as for industrial war service of all kinds. 
 This readjustment could never have been accomplished half so 
 quickly and so expeditiously had not the labor movement of 
 the preceding decades supplied at hand the necessary machinery 
 of organization. Nor could it have been brought about with- 
 out centralized control of economic forces by the National 
 Government. That it was accomplished in such a short time 
 and with so little disturbance to the orderly processes of pro- 
 duction is one of the marvels of our varied war activities. 
 
 Industries over-night were turned from peace time to war 
 time production. A swamp yesterday was today a thriving, 
 hustling town surrounding an entirely new industry. Barren 
 fields one day were populated camps or cantonments or training 
 stations the next day. This sounds quite easy and simple when 
 stated in mere words but the details of the actual thing fills 
 one with wonder and astonishment at the ease and quickness of 
 adaptability in a great emergency not only of the American 
 workingman but also of the American employer. Our indi- 
 vidualistic system of production had developed this adaptability 
 unconsciously almost, at least these workers and employers had 
 never before been called upon to such an extraordinary extent 
 as so clearly to demonstrate the possession of this quality as a 
 national characteristic. Nothing else offers so satisfactory an 
 explanation of the remarkable transformation. 
 
 The nature of the employment of labor being primarily deter-
 
 42 THE WORKERS AT WAR 
 
 mined by the characteristics of the employment of capital, it 
 was first necessary that the Government exercise in innumer- 
 able directions arbitrary control over capital. And the spirit of 
 acquiescence with which this ordinarily repellent interference 
 was met is only to be explained on the ground of patriotism. 
 Employers who would have offered the most determined opposi- 
 tion under ordinary circumstances to any interruption of their 
 normal production activities, without a word of protest consented 
 to the complete and sudden shut down of the usual output of 
 their plant and adjusted their entire resources to the production 
 of whatever war material they were told the Government was 
 most in need. And the employes of the plants as willingly 
 acquiesced in almost as complete a dislocation from their normal 
 pursuits. 
 
 One plant that was engaged before the war in manufacturing 
 steel passenger cars, another in making safes, and a third in 
 producing hoisting and mining machinery were assigned to 
 turning out carriages for 155-millimeter guns. The recoil 
 machinery for this gun, the manufacture of which presents 
 peculiarly difficult problems, was made by an elevator company 
 and an automobile corporation. Another automobile factory, 
 an air-brake plant, and a Government arsenal were put to work 
 making carriages for the 75-millimeter guns. A sewing ma- 
 chine company and a Government arsenal manufactured the 
 recoil mechanism. 
 
 Nothing illustrates this adjustment to war time requirements 
 more concretely than the situation with regard to the automobile 
 industry. At a meeting in Detroit early in August, 1918, the 
 automobile manufacturers of the United States had adopted a 
 resolution voluntarily agreeing to the curtailment of 50 per cent. 
 of their production of passenger cars. To this the War In- 
 dustries Board replied that while the action was clearly a step 
 in the right direction and furnished a basis for each and all 
 the manufacturers, without further delay, to make appropriate 
 reductions in selling, general, and overhead expenses, " still it 
 is only a step, and a further curtailment is inevitable." The
 
 THE WORKERS AND THE WORLD WAR 43 
 
 Board advised the automobile manufacturers that there would 
 be " little, if any, of the principal materials required in the 
 construction of passenger cars available for non-war industries 
 after the war requirements shall have been provided for," and 
 that it could not " make any promise whatsoever regarding the 
 supply to your industry of steel, rubber, or other materials for 
 any definite period in advance. We strongly believe that it is 
 to the best interest of your members and all other manufacturers 
 of passenger automobiles to undertake to get on 100 per cent, 
 war work as rapidly as possible and not later than January i, 
 1919, for in no other way can you be sure of the continuance 
 of your industry and the preservation of your organization." 
 
 Into the hands of this War Industries Board had been given 
 virtually absolute power over all raw materials. These were 
 controlled by it primarily for meeting the war needs of the 
 Government. The functions of this 'board are briefly sum- 
 marized as follows from the statement of President Wilson of 
 March 4, 1918: To create new facilities; to disclose and if 
 necessary to open up new or additional sources of supply ; to 
 convert existing facilities, where necessary, to new uses; to 
 study the conservation of resources and facilities by scientific, 
 commercial, and industrial economies; to advise purchasing 
 agencies of the Government with regard to prices to be paid ; to 
 determine, wherever necessary, priorities of production and of 
 delivery ; to determine the proportions of any given article to be 
 made immediately accessible to the several purchasing agencies 
 when the supply of that article is insufficient, either temporarily 
 or permanently ; and to make purchases for the Allies. 
 
 The exercise of these functions concentrated in this board 
 control over virtually the entire production processes of the 
 nation. The effect of this upon the adjustment of labor to war 
 conditions is apparent. No industry could continue in peace 
 time operation if the board decreed otherwise. These decisions 
 of the board in consequence determined the disposition of the 
 labor force as between industries. Take, for illustration, the 
 resolution of the board made public March 27, 1918, in which
 
 44 THE WORKERS AT WAR 
 
 was announced its policy towards new corporations organized 
 for the erection of industrial plants which could not be utilized 
 in the prosecution of the war, and also towards the plans of 
 certain of the states, counties, cities, and towns for the con- 
 struction of public buildings and other improvements which 
 would not contribute directly toward the winning of the war. 
 As the carrying forward of these activities would involve the 
 utilization of labor, material, and capital urgently required for 
 war purposes, the board stated that " in the public interest all 
 new undertakings not essential to and not contributing, either 
 directly or indirectly, toward winning the war . . . will be dis- 
 couraged, notwithstanding they may be of local importance and 
 of a character which should in normal times meet with every 
 encouragement." It gave notice that it would withhold from 
 such projects priority assistance, without which new construc- 
 tion of the character mentioned would frequently be found im- 
 practicable, and that parties embarking on such undertakings 
 did so at their peril. 
 
 Along the line of controlling the disposition of capital and 
 through this means eliminating non-essential production during 
 the war the Federal Reserve Board passed upon proposals as 
 to capital expenditures. The avoidance of unnecessary expen- 
 ditures in both private and public enterprises was insisted upon. 
 Before making contracts involving the use of labor and mate- 
 rial, or placing new issues of securities, or agreeing to purchase 
 new issues, bankers and corporations were required to confer 
 with the board in order that it determine whether the under- 
 taking covered by the proposals was necessary for the public 
 health and welfare or contributed directly toward winning the 
 war. Public improvements and new private enterprises which 
 in time of peace were entirely proper were now considered in 
 connection with the great governmental problems arising out 
 of military necessities. In consequence of the work of the 
 Capital Issues Committee many proposed ventures were sup- 
 pressed at the source, either because the applicants realized 
 that the purposes for which they desired to issue securities were
 
 THE WORKERS AND THE WORLD WAR 45 
 
 not compatible with the national interests, or because the local 
 committees were able to impress upon them the point of view 
 of the Government before they reached the central committee 
 at Washington. Notwithstanding, this central committee 
 passed upon numerous applications, in one week alone these 
 numbering ninety-six and aggregating $232,868,918, being 
 largely renewal and refunding operations. 
 
 The manufacture of passenger automobiles for pleasure and 
 the construction of buildings other than for immediate use for 
 war purposes are taken merely to illustrate that upon America's 
 entrance into the war all industrial activities of the people be- 
 came at once of relative importance, and this relativity was 
 measured solely by the industry's ability to contribute to the 
 prosecution of the war. Some were absolutely vital to this 
 end, but many more could be temporarily dispensed with. Tre- 
 mendous as were the country's resources there was not suffi- 
 cient capital, materials, machinery, and labor both for fighting 
 the war to a successful conclusion and continuing at the same 
 time normal business enterprises. The country's industrial 
 equipment was limited in face of the enormous demand upon 
 it. The war had to be prosecuted there was no other 
 thought conceivable and in consequence normal lines of pro- 
 duction had to cease in order to provide the necessary war 
 equipment. 
 
 Under these conditions it should be expected that the dec- 
 laration of war would be followed almost immediately by wide- 
 spread dislocation of industry. The conduct of industry and 
 of business enterprises generally had been proceeding through 
 many years of peace along certain definite lines of production 
 not at all related to the conduct and operation of a foreign 
 war, and certainly not of a war of the magnitude that the 
 European conflict had assumed. War meant not only a de- 
 crease in the production of so-called non-essentials and a com- 
 plete change in the production of many commodities but also 
 an enormous increase in the manufacture of other commodities. 
 Radical readjustments in industry alone would enable the Gov-
 
 46 THE WORKERS AT WAR 
 
 ernment to secure the necessary war supplies. And among 
 these readjustments was the taking of labor from its normal 
 occupations and transferring it to war time employments, not 
 alone for the Army and Navy and other branches of the mili- 
 tary service but for the industrial production of all forms of 
 munitions and supplies necessary to the successful work of 
 the soldier. 
 
 In the most literal sense the war became an industrial war 
 between peoples and was fought by employments of production 
 as well as by rifles and cannons. It was a war of industrial 
 resources no less than of armies. Not only did the places of 
 soldiers withdrawn from industries have to be filled but en- 
 tirely new occupations had also to be provided for and the men 
 secured to fill them. There was imperative need for the con- 
 struction of cantonments, of training stations, of hospitals, of 
 aircraft plants, of shipyards, of arsenals, and of hundreds and 
 hundreds of plants and factories for the making of war mate- 
 rials of every possible description. 
 
 All this also assisted in the radical dislocation of labor. Pro- 
 duction was largely centered in the cities and towns on the 
 Atlantic seacoast ; and towards these industrial centers hun- 
 dreds of thousands of workmen were drawn by the trainloads 
 from all parts of the Middle West and Rocky Mountain sec- 
 tions and from as far south as Texas. With the working popu- 
 lation of those centers, these recruits made rifles and cannons 
 and flying machines and motor trucks and cartridges and cloth- 
 ing and built ships and the thousand and one other things neces- 
 sary for the equipment and transportation of an army of 
 millions of men. Not the least of these efforts was the con- 
 struction of houses for the workers themselves, as this trans- 
 plantation of male population swamped all the industrial cen- 
 ters, and houses for the men to live in became vital to continu- 
 ous production. 
 
 With so many economic forces at play it is not possible to 
 decide which contributed most to winning the war. One 
 should be satisfied with the result without undertaking the
 
 THE WORKERS AND THE WORLD WAR 47 
 
 thankless task of apportioning the credit. But this willingness 
 and adaptability of the American workingman in meeting almost 
 every emergency he was called upon to meet should not be 
 permitted to escape having attached to it the significance which 
 its importance deserves as a factor of vital influence in de- 
 termining the outcome of the war. In so far as the participa- 
 tion of the United States is considered, the war was won be- 
 cause of uninterrupted production of the things absolutely 
 essential in getting the army trained, equipped and on the battle- 
 fields of France. If our production machinery, which accom- 
 plished this tremendous task, had failed at any vital point in 
 supplying essential materials, the war could not have been suc- 
 cessfully terminated in favor of the Allies. And in the per- 
 formance of this task the American workingman can justly 
 claim no small part.
 
 CHAPTER V 
 
 THE AMERICAN WORKINGMAN AT WAR 
 
 THE American workingman is blood-brother to the Ameri- 
 can soldier who fired at Chateau-Thierry the gun that 
 stopped the German that caused the retreat that forced the 
 armistice that won the war. Back of this American soldier 
 who carried the gun was the worker who dug the ore, who 
 forged the steel, who shaped the shell, who made the powder, 
 who assembled the parts, who perfected the gun ; the worker 
 who stoked the furnace that supplied the steam that operated 
 the engine that moved the ship that transported the soldier 
 and the gun. Back of him also was the worker who ran the 
 locomotive that hauled the train that carried the coal that 
 operated the machinery that moved the lathe that fashioned 
 the gun the worker who mined the coal that fueled the boiler 
 that started the engine that pulled the cars that carried the 
 lumber that formed the barracks that housed the soldier the 
 worker who tended the loom that transformed the wool that 
 made the uniform that clothed the soldier the worker who 
 grew the food that nourished the soldier that pulled the trigger 
 that fired the gun that sped the bullet that won the war. This 
 worker is the American workingman whose blood-brother, we 
 repeat, carried the gun that stopped the German at Chateau- 
 Thierry. 
 
 Back of this soldier of his living, his training, his equip- 
 ment, and his transportation across the seas back all along 
 the line were millions of toiling, sweating, labor-giving men 
 whose work was necessary before the soldier could have fired at 
 Chateau-Thierry the shot that won the war. 
 
 The mere details of this twentieth century miracle are prosaic. 
 
 48
 
 THE AMERICAN WORKINGMAN AT WAR 49 
 
 They simply record the excavating of dirt, the mixing of rnor- 
 tar, the laying of brick, the felling of trees, the sawing of 
 lumber, the nailing of boards, the mining of coal, the operating 
 of machines, the fashioning of metals, the sewing of cloth, the 
 growing of food, the running of trains, the manning of ships 
 the doing of the thousand and one acts of labor that go to make 
 up the everyday humdrum life of. the American toiler. 
 
 On the day the United States officially entered the war, April 
 2, 1917, its entire military force in service was 212,034 officers 
 and enlisted men distributed in the regular army, in the national 
 guard of the separate states in Federal service, and in the 
 Reserve. One year later, on April i, 1918, the total number of 
 men under arms in the military service was 1,652,725. These 
 comprised 10,698 officers and 503,142 enlisted men in the regu- 
 lar army, 16,893 officers and 431,583 enlisted men in the Na- 
 tional Guard, 516,839 enlisted men in the national army, and 
 96,210 officers and 77,360 enlisted men in the Reserve. Within 
 twelve months the number of men under arms had been in- 
 creased eightfold. 
 
 Another army, but of civilian workers from all the building 
 crafts, and exceeding in number one hundred thousand, was 
 recruited out of the labor force of the country not included in 
 the draft ages and put to work to house in training camps this 
 fighting army of soldiers an unprecedented army for an un- 
 warlike people. These workers built almost over-night, sixteen 
 cantonments and an equal number of other camps virtually 
 thirty-two small-sized cities each accommodating a minimum of 
 twenty-two thousand men and some as many as forty thousand 
 men. These military towns which the Government constructed 
 through the War Department were located in different sections 
 of the country at the various mobilization centers. From three 
 thousand to ten thousand workers were required in the erection 
 of each camp, the number of men employed depending upon 
 its size. 
 
 This is equivalent in each case to the construction of approxi- 
 mately one thousand separate buildings covering more than a
 
 50 THE WORKERS AT WAR 
 
 square mile of ground, exclusive of the area required for drill 
 purposes, such buildings comprising barracks for the men and 
 quarters for the officers, kitchens, mess halls, bath houses, 
 stores, warehouses, refuse disposal plants, laundries, hospitals, 
 garages, theatres, rifle ranges, railway stations, post offices and 
 the score and more other separate structures necessary to pro- 
 vide housing for the troops and for the varied activities of a 
 big camp. In all the sixteen cantonments there were erected 
 as many as twenty-two thousand individual buildings of many 
 types. Roadways and asphalted and paved streets, electric 
 lighting and steam heating plants, water works, sewers, tele- 
 phone lines, fire protection service, railway facilities, and like 
 modern needs all depended upon manual labor to create them. 
 
 Then, too, there were the workers back in the forests of 
 mountain recesses felling the trees and hauling them to the mills, 
 and men in the mills sawing the logs into lumber for these build- 
 ings. Within sixty days one hundred and ninety mills in all 
 parts of the country shipped to the cantonment sites more than 
 500,000,000 feet of lumber requiring twenty-four thousand 
 freight cars to transport it. 
 
 Workers were engaged also in the production of the 4,000 
 street lamps, the carload of roofing tacks, the 5,000 water casks, 
 the 8,000 fire extinguishers, the 22,000 cubic yards of sand, the 
 40,000 cubic yards of brpken stone and screened gravel, the 
 75,000 barrels of cement, the 93,000 kegs of nails, the 140,000 
 doors, the 140,000 rolls of sheathing paper, the 250,000 fire 
 pails, the 265,000 feet of lamp cord, the 320,000 inside lamps, 
 the 380,000 feet of fire hose, the 686,000 sashes, the 3,000,000 
 square feet of screens, the 6,000,000 square feet of roofing 
 paper, the 20,000,000 feet of insulated wire, the 30,000,000 
 square feet of wall boarding and the innumerable other com- 
 modities necessary to the construction of these cantonments. 
 In brief, each cantonment required five thousand carloads of 
 material, not including supplies for the workmen while en- 
 gaged in construction a total for the sixteen cantonments 
 of eighty thousand carloads.
 
 THE AMERICAN WORKINGMAN AT WAR 51 
 
 Recall to mind also those other millions of workers in the 
 civilian army who were toiling in the second line of defense 
 in the production of the materials for clothing and equipping 
 the soldier army those workers who made the 6,500,000 
 overcoats, the 8,000,000 hats, the 8,000,000 barrack bags, the 
 8,000,000 bed sacks, the 11,000,000 woolen coats, the 14,000,000 
 pairs of woolen breeches, the 20,000,000 blankets, the 21,000,- 
 ooo pairs of shoes, the 22,000,000 yards of overcoating, the 
 26,000,000 undershirts, the 31,000,000 pairs of drawers, the 
 31,000,000 yards of cloth for uniforms, the 35,000,000 yards 
 of flannel suiting, the 50,000,000 pairs of heavy stockings, and 
 the 250,000,000 yards of cotton cloths contracted for at one 
 time. 
 
 In the manufacture of woolen goods alone for the Army the 
 co-operation of employes in more than three hundred mills was 
 necessary. By May I, 1917, the government had contracted 
 for fifty million yards of duck for tents, motor truck coverings, 
 leggings, haversacks, and other equipment. Investigation dis- 
 closed that all the duck mills of the entire country were un- 
 able to produce more than twenty million yards before January 
 i, 1918. To secure the additional thirty million yards manu- 
 facturers of carpets and other cotton textiles turned their em- 
 ployes and plants to making duck. Hundreds of looms were 
 changed and builders' stocks altered so extensively that many 
 mills without facilities for making yarns encountered a serious 
 shortage of this material. Then the forces of the yarn makers 
 were mobilized behind the mills in order to secure the sixteen 
 million pounds of cotton yarn needed. 
 
 Think, too, of the myriad of other workers engaged in the 
 production of the twenty-nine regular articles of clothing of 
 the soldier and the ninety articles of his equipment buttons, 
 belts, shoe laces, leggings, service hats, slickers, bugles, axes, 
 and so on. 
 
 By June, 1918, factory workers had produced for the United 
 States Army 1,568,000 rifles, excluding 200,000 separate 
 parts, a rate of production of 45,000 a week. The workers in
 
 52 THE WORKERS AT WAR 
 
 i 
 
 eight plants had made this output with the employes in only 
 five of the eight busy all the time, production in three having 
 been slowed down on rifles in order to turn out machine guns 
 and automatic pistols. This industry alone was employing 
 ninety thousand men, women and children. 
 
 Many other thousands were producing 1,000,000,000 rounds 
 of ammunition for the troops in the training cantonments alone, 
 427,246,000 pounds of explosives, 60,000,000 hand and rifle 
 grenades and an equal number of projectiles for all calibres 
 of heavy artillery, 175,000,000 clips for small-arms cartridges 
 and 22,000,000 bandoleers for carrying cartridges, 725,000 auto- 
 matic pistols, and 250,000 revolvers. 
 
 Other workmen were turning out complete machine guns at 
 the rate of two hundred and twenty-five thousand a year, 3*4 
 inch to 9 inch calibre guns at the rate of fifteen thousand a year, 
 and cartridges for rifles and pistols at the rate of twenty mil- 
 lion a day. Since this country had entered the war and up 
 to and including July 19, 1918, the total output of cartridges 
 for rifles, pistols, revolvers, and machine guns, inspected and 
 accepted, was 2,014,815,584. This made the daily average 
 output approximately 15,000,000 but included in the time cal- 
 culated were months that had been necessary for preparation 
 during the earlier days and the output had naturally increased 
 as this preparatory period was left behind. The maximum 
 number inspected and accepted in a single day up to August 
 3, 1918, was 29,466,000 on July 5 of that year. The number 
 of small arms such as rifles, pistols, revolvers, and machine 
 guns inspected and accepted up to July 14 totaled 1,886,769 
 complete rifles of all types, 217,000 pistols, 169,367 revolvers, 
 and 82,540 machine guns. 
 
 Still other workers were making thirty-five thousand motor 
 trucks and tractors for hauling heavy guns and ammunition. 
 At the beginning of the war there were only three thousand 
 motor trucks, four hundred and fifty automobiles, and six hun- 
 dred and seventy motorcycles in the Quartermaster Corps of 
 the Regular Army. From April 8, 1917, to July I, 1918, there
 
 THE AMERICAN WORKINGMAN AT WAR 53 
 
 had been produced for the motor transport service 27,005 mo- 
 torcycles and 25,874 side cars for motorcycles, and 8,809 motor 
 ambulances. By July i there were overseas alone 18,000 motor 
 trucks and 3,420 passenger cars. American mechanics were 
 at that time turning out trucks complete and ready for im- 
 mediate use at the rate of forty-five hundred a month. A 
 standardized truck of interchangeable parts specially devised 
 for heavy military duty was designed, and in October an order 
 placed for ten thousand, actual production beginning in Janu- 
 ary, only five months from the starting of the work. Standard- 
 ization was also applied to the trailers, motorcycles, bicycles, 
 machine-shop trucks, tank trucks, and other automotive equip- 
 ment. Workmen were necessary in repair shops to maintain 
 this equipment and also in the standardized base shops, each 
 of the latter covering four acres of ground and requiring a 
 force of twelve hundred mechanics to operate, these shops 
 serving also as depots and training centers for the selection 
 and organization of skilled personnel to be sent overseas. 
 
 All these men the soldiers, the workers constructing and 
 those operating the training camps and those making the 
 thousand and one articles necessary to their operation these 
 millions had to be fed, and in the performance of this task, by 
 no means a small one, other divisions of the army of toilers 
 back on the farms and in the factories and food depots were 
 called upon. What this task was is illustrated in the estimated 
 annual supplies for the one million men in the Army in the 
 United States exclusive of the soldiers in France. These sup- 
 plies amounted to 398,000,000 pounds of fresh beef and 8,000,- 
 ooo pounds of canned beef, the latter not including canned 
 corned beef hash ; 480,700,000 pounds of potatoes ; 300,000,000 
 pounds of flour; 55,000,000 pounds of onions; 50,000,000 
 pounds of granulated sugar; 29,600,000 pounds of coffee; 8,- 
 200,000 pounds of lard ; 7,300,000 pounds of butter, excluding 
 oleomargarine ; 3,800,000 cans of black pepper, cinnamon, 
 cloves, ginger, and nutmeg; 1,000,000 gallons of cane syrup; 
 850,000 gallons of cucumber pickles. In addtition there were
 
 54 THE WORKERS AT WAR 
 
 the supplies for the remainder of the soldiers' forty-nine items 
 of regular rations, such as bacon, baked beans, corn, peas, 
 tomatoes, flavoring extracts, other canned vegetables and 
 fruits, evaporated apples and peaches, canned and dried fish, 
 candy, chewing gum, as well as the additional 165 items sup- 
 plied for sale to the soldier at cost, such as various kinds of 
 foodstuffs and also shaving mugs, razors, toilet articles, pencils, 
 thread, pins, pens, shoe polish, letter paper, pipes, and so on. 
 
 While these fragmentary details of the work of the toilers 
 in the second line of defense enable one to form some idea of 
 the task the American workingman was called upon to per- 
 form, that task was of a magnitude so great it is be- 
 yond the power of mere word description to convey a 
 comprehensive conception of it. No complete picture of this 
 could be given even if ten times the space were available. It 
 can only be vaguely indicated by selected instances, and even 
 then the imagination has to be called upon for assistance. 
 
 Conceive, for illustration, of the workers all along the line 
 of production that were necessary to carry to completion the 
 297 separate projects for emergency work to house and meet 
 the needs of soldiers in this country and to provide buildings 
 for the manufacture and 'storage of supplies for the Army, 
 both here and abroad, which had been undertaken by the con- 
 struction division of the War Department and which had been 
 executed or were under way and in prospect on June I, 1918. 
 In addition plans had been laid for 117 new operations. The 
 estimated cost of the 297 projects was $1,170,619,000, not in- 
 cluding three operations costing $106,000,000 which were be- 
 ing conducted under the direct control of the Ordnance De- 
 partment. The cost of the 117 new projects was estimated to 
 be $700,000,000. 
 
 In caring for the health of the soldiers alone thirty-two hos- 
 pitals were constructed and more than forty others enlarged. 
 Each cantonment hospital comprised about seventy different 
 buildings covering sixty acres of ground, the hospital proper 
 providing for a minimum of one thousand beds.
 
 THE AMERICAN WORKINGMAN AT WAR 55 
 
 For the production of nitrates two entirely new plants were 
 constructed and equipped with machinery and materials, each 
 involving an appropriation of forty-five million dollars. One 
 of these had a capacity of sixty thousand pounds of ammonia 
 each twenty-four hours. For the purpose of increasing the 
 production of ammonia and toluol, by-product coke ovens and 
 water-power plants were installed. 
 
 By August, 1918, workmen had completed for the Ordnance 
 Department twenty-six out of thirty-three plants for the pro- 
 duction of gun carriages and recoil mechanisms at a cost of 
 twenty-five million dollars. In the preceding month there had 
 been made ready for use fifteen out of sixteen gun plants for 
 the forging and machining of cannon, with a total expended 
 or obligated of nearly seventy-five million dollars, including a 
 new plant for the manufacture of big guns at Neville Island, 
 Pittsburgh. Altogether the amount expended or obligated up 
 to that time to provide facilities for the production of guns, 
 carriages, and recoil mechanisms totalled $99,606,633, exclud- 
 ing provision for the manufacture of artillery limbers, caissons, 
 and ammunition wagons. 
 
 An entirely new industry had to be created for the produc- 
 tion of gun carriages and for the forging and machining of 
 cannon. This simple statement means that for the carriage 
 of the 240 millimeter howitzer, the most complex of carriages, 
 as many as six thousand separate pieces, exclusive of rivets, 
 had to be made. For the production of the French model gun 
 carriage alone plants had to be selected to manufacture the car- 
 riages, new shops built, special machinery manufactured and 
 installed, and even the machine tools with which to make the 
 machine-tool equipment of the carriage plants had to be made. 
 Standardization of manufacture had to be accomplished to such 
 a degree that any part produced in any plant would be inter- 
 changeable with any similar part produced in any other plant, 
 and all parts produced in American plants interchangeable with 
 similar parts produced in French plants. 
 
 In as many as fourteen hundred different manufacturing
 
 56 THE WORKERS AT WAR 
 
 establishments and in eleven Government arsenals workers by 
 the thousands were turning out articles of war for the Ord- 
 nance Department of the Army alone. To take care of these 
 products in the course of their distribution more than 23,000,- 
 ooo square feet of storage space had to be provided. These 
 Ordnance storage properties embraced separate warehouse 
 buildings and miles of railroad sidings within the depot prem- 
 ises. One of these newly constructed depots for the storage 
 of war materials included one hundred separate buildings and 
 fifty miles of specially built railroad track enclosed in electric- 
 ally charged wire barriers. The supply division of this de- 
 partment handled material amounting approximately to ten 
 thousand carloads a month. 
 
 Some idea as to the number of men required to carry on this 
 highly organized mechanism of manufacture, storage, and 
 distribution is suggested in the fact that as many as one hun- 
 dred thousand different articles, ranging all the way from the 
 small striker or firing pin of a rifle to a complete sixteen-inch 
 gun and emplacement, had to be created out of their raw ma- 
 terials and supplied to the troops. As an illustration, a single 
 gun with its disappearing carriage has 7,990 parts exclusive 
 of sights and accessories. Even the three-inch gun battery re- 
 quires 3,876 tools, accessories, and supplies as essential parts 
 of its outfit. Reserves in all these spare parts had to be main- 
 tained and their distribution carried out with efficiency and 
 under difficult circumstances. Not only did these intricate and 
 complex weapons of modern warfare have to be designed and 
 manufactured by the American workingman but he was called 
 upon to produce also the incalculable number of tools, gauges, 
 and jigs required in this manufacturing process. 
 
 So it was with the Aviation Service of the Signal Corps of 
 the Army. It was called upon to organize a highly trained 
 personnel and to build the most intricate kind of equipment 
 with practically no foundation upon which to start in fact, 
 the foundation itself had to be laid. Three appropriations to- 
 taling $691,000,000 measure in dollars its first year's program.
 
 The air service started with 65 officers and 1,120 men, three 
 small flying fields, less than three hundred second-rate planes, 
 virtually no aviation industry, and with only the most meager 
 knowledge of the kaleidoscopic development in air war service 
 abroad. Schools of eleven different kinds were instituted, 
 courses of instruction laid out, and instructors secured, the 
 latter including foreign experts in a score of lines. Flying 
 fields were built, some of them with site selected, ground 
 cleared and leveled, hangars and quarters erected, and tele- 
 phone, transportation, drainage, and the like installed within 
 five weeks' time a strategic net work of fields distributed 
 over the country along the main proposed aviation routes. 
 From the employes of a single company in the United States 
 capable of anywhere near quantity production of training 
 planes (as for battle planes their production in America had 
 not even been thought of) there were in a comparatively short 
 time thousands of skilled workers of a score of large companies 
 producing planes, of fifteen turning out engines and of more 
 than four hundred other companies providing the necessary 
 spare parts, accessories, and other essential supplies. 
 
 This marks, in brief, the demajjji, in part, for such workers 
 as machinists, auto-mecha/lics, engine repairmen, gun ma- 
 chinists, chauffeurs, carpenters, blacksrriiths, tinsmiths, cabinet 
 makers, electricians, cotfoersmiths, sheet \metal workers, pro- 
 peller makers, wireless fperators and constructors, tent makers, 
 sail makers, truck mas^bfS, vulcanizers, Wefyers, and repairers 
 and installers of magnfcto-ignitibn systems, Cameras, watches, 
 clocks, and other instruments. Virtually ~ni|iety-eight out of 
 every one hundred men in the air^service <Ha$ to be skilled in 
 some branch of work. . ' % 
 
 Aeroplane production \vas wholfy 4 new v d unfamiliar to 
 American mechanics and yet 'Wiose, taken froin other trades and 
 converted hastily into workers on^h^njpst-' intricate and delicate 
 kinds of aircraft machinery soon adapted themselves to the de- 
 mands made upon their skill. Tens of thousands of skilled me- 
 chanics, engine men, motor repair men, and wood and metal
 
 58 THE WORKERS AT WAR 
 
 workers were needed to keep the planes always in perfect con- 
 dition, this requiring a huge engineering and mechanical force 
 at the air dromes, flying fields, and repair depots both in the 
 United States and behind the lines in France. Without this 
 force of American workmen the planes turned out by Ameri- 
 can workmen would of course have been useless and the 
 American fliers helpless. 
 
 The land division of the Signal Corps of the Army also fe- 
 quired skilled workmen in order to enable it to operate, such 
 as chauffeurs, motorcycle drivers, and gas-engine repairmen 
 for duty in field and telegraph battalions; telegraphers, both 
 wire and radio; telephone men, including switchboard oper- 
 ators, telephone repairmen, and men skilled in testing and re- 
 pairing telephones in line; linemen, both telegraph and tele- 
 phone ; photographers, both still and moving ; homing pigeon 
 men, radio men familiar with installing apparatus, black- 
 smiths, cobblers, clerks, cable men, cooks, and so on down a 
 long line of skilled trades. 
 
 In the manufacture of gas masks and like appliances the 
 Medical Department of the Army also needed the labor of 
 mechanics, glass blowers, pipefitters, electricians, carpenters, 
 blacksmiths, chemists, laborers, and the like. The gas de- 
 fense service of the War Department was conducting, within 
 three weeks after America's entrance into the war, a com- 
 pletely equipped factory for the manufacture of gas masks for 
 horses with an output of five thousand masks a day. This 
 rate of production was partly due to the introduction of rivet- 
 ing machinery which did away with the heavy hand sewing of 
 the frame which supports the mask on the face of the horse. 
 
 And so it was in these humble and inconspicuous ways that 
 the American workingman in mine and mill and factory and 
 plant did his part in laying low the Political Autocracy of the 
 German Government as it swaggered and strutted through 
 Belgium and into France.
 
 CHAPTER VI 
 
 WORKING FOR THE GOVERNMENT 
 
 THE labor of the American workingman in providing 
 training accommodations and in producing supplies and 
 equipment, including the largest battleships the world had ever 
 seen, was as essential to the Navy as we have seen it to have 
 been to the Army. From a force of 68,000 enlisted men and 
 4,500 officers in January, 1917, the Navy had expanded by De- 
 cember i of that year to 254,000 enlisted men and 15,000 of- 
 ficers 1 from less than 75,000 to nearly 270,000 including 
 regulars, reserves, and national naval volunteers. It had 130 
 stations of all kinds on January i ; it had a total of 363 eleven 
 months later. The number of employes at regular navy yards 
 in the United States had increased from 35,000 to more than 
 60,000. On shore and afloat, including civilians and sailors, 
 the Naval Establishment embraced more than 300,000. The 
 expenditures for all naval purposes at the beginning of the fis- 
 cal year 1917 were about $8,000,000 a month; in December 
 of that year they were $60,000,000 a month. On January i 
 there were 300 naval vessels of all kinds in commission ; in 
 December more than 1,000. 
 
 Thus succinctly is indicated the task the Navy was called 
 upon to accomplish in the way of meeting the great expansion 
 that was found necessary. The large and sudden influx of 
 
 1 From the annual report of the Secretary of the Navy, December, 
 1917. In June, 1918, the strength of the Navy had increased to 
 423,800 enlisted men and 26,285 officers. These were divided as fol- 
 lows : Regular Navy, 205,798 men, 9,204 officers; Naval Reserves, 
 148,505 men, 14,704 officers; Marine Corps, 48,505 men, 1,364 officers; 
 National Naval 'Volunteers, 15,000 men, 785 officers; Coast Guard, 
 6,000 men, 228 officers. 
 
 59
 
 60 THE WORKERS AT WAR 
 
 enlisted men and officers overtaxed the peace time training sta- 
 tions before increased facilities could be provided. An illus- 
 tration of the immensity of the work American labor per- 
 formed in meeting this situation is the new Naval Training 
 Camp and other improvements at Hampton Roads in Vir- 
 ginia. This camp covers four hundred acres and embraces 
 more than one hundred and fifty buildings. On July 15 the 
 camp site, formerly the grounds of the Jamestown Exposition 
 of 1907, was largely covered with brambles and scrub pine. 
 Within a few weeks four thousand workmen had drained the 
 marshes, laid out the roads, and erected ninety buildings, 
 including barracks and mess halls. These accommodated 
 eight regimental units and a detention and hospital division, 
 each unit having its own mess hall, barracks, and officers' quar- 
 ters. A temporary storehouse was over one-eighth of a mile 
 long and two hundred and sixty feet wide ; there was also a per- 
 manent storehouse of reinforced concrete, five stories high and 
 416 by 119 feet. The camp included a bakery, laundry, and 
 sterilizing plant. The Great Lakes Naval Training Station 
 near Chicago, Accommodating seventeen thousand men, the 
 largest of the naval cantonments, consisted of six camps built 
 around a central permanent establishment. 
 
 To clothe the tens of thousands of recruits in the different 
 service branches of the Navy the meager supply of eleven 
 thousand sets of uniforms on hand at the naval supply depots 
 at the outbreak of the war were of course wholly inadequate. 
 Nor were the manufacturers able at first to produce the quan- 
 tities of uniform cloth required. This meant the securing of 
 the labor necessary to produce the raw material for the uni- 
 forms and then other labor to manufacture it into suits. By 
 August, 1917, the Navy had let contracts for 4,500,000 yards 
 of woolen uniform cloth at an aggregate cost exceeding $16,- 
 000,000. The amount of wool in the grease required for the 
 manufacture of the cloth was upward of 15,000,000 pounds. 
 If delivered at one time this cloth would require storage space 
 of about 300,000 cubic feet and would weigh nearly 4,500,000
 
 WORKING FOR THE GOVERNMENT 61 
 
 pounds; it would make 1,000,000 shirts or jumpers, 800,000 
 pairs of trousers, and 350,000 overcoats; it required all the 
 facilities of thirty-five separate mills in its manufacture. By 
 the time this single order was placed correlation and coopera- 
 tion between the workers engaged in the various processes 
 had reached the point where uniforms were being turned out 
 complete at the rate of seventy thousand a month. 
 
 The Navy Department's building program comprised the 
 improvement and extension of training stations, aviation sta- 
 tions, submarine bases, and navy yards, and the erection of im- 
 mense storage warehouses for supplies and munitions, of dry 
 docks capable of accommodating the largest vessels, gun shops, 
 including at the naval gun factory the largest gun shop of the 
 kind in the world, and hundreds of other buildings for the 
 various branches of the service. This improvement program 
 amounted to the virtual rebuilding of some of the navy yards 
 and stations, comprising ways, shops, tools, cranes, and all the 
 requisite appurtenances and auxiliaries. The warship build- 
 ing facilities of the large private plants had also to be increased 
 by an enlargement of shops, as well as an increase in the facili- 
 ties at some of the large electric, steel, and ordnance plants of 
 the country. There was a remodeling and enlargement of all 
 the power plants at the stations and the perfection of plans 
 for carrying out an arrangement to " tie in " these various im- 
 portant government plants with industrial sources of power in 
 their vicinity. 
 
 The Navy's shipbuilding program provided for the construc- 
 tion of the largest warships ever built, involving the supplying 
 of structural shops, machine shops, and foundries of the most 
 modern type, some of them of unprecedented size, as was also 
 the machinery for these buildings necessitating, for illustration, 
 traveling cranes having a capacity as high as three hundred 
 tons and fitting-out cranes with a capacity of nearly four hun- 
 dred tons. America's mercantile marine had never been of 
 a size sufficient to have created for its own purposes these 
 enormous shipbuilding facilities. In fact, such facilities as
 
 62 THE WORKERS AT WAR 
 
 were available in this country were so small as to make the 
 carrying out of the naval program of the war impossible with- 
 out large additions to the private yards as well as to the govern- 
 ment navy yards. This ship construction program by Oc- 
 tober, 1917, provided for 787 vessels of all types, from sub- 
 marine cliasers to superdreadnaughts, at a total cost exceeding 
 $1,150,000,000. 
 
 This lack of facilities was particularly striking in the case 
 of the construction of destroyers. A large number of vessels 
 of this type had been made necessary by the requirements of 
 modern naval warfare, and especially by the depredations of 
 the German submarine, and yet there was not in the entire coun- 
 try a single vacant ways to hold them. Not only were there 
 no ways for these most essential vessels, and in many cases 
 not even ground enough in the shipyards on which to build 
 such ways, but there also were not in the entire United States 
 enough skilled mechanics in the forge plants, to take a single 
 illustration, to forge the shafts and propelling machinery with- 
 out suspending operations essential to the arming of the troops. 
 In building the destroyers keels were laid on ground that a 
 few months before was swamp land, extensions were made 
 to forge plants which in some cases were as large and even 
 larger than the original plants themselves, and every manufac- 
 turer and every available worker sufficiently trained to make 
 anything needed for a destroyer was set at this task. 
 
 A somewhat similar situation confronted the Navy in sup- 
 plying those two potent weapons of modern warfare, the aero- 
 plane and the submarine; weapons that were not even men- 
 tioned in the military textbooks of a dozen years before. The 
 facilities for their construction in any* considerable numbers 
 had to be created over-night ; skilled mechanics had to be se- 
 cured somewhere and somehow. So with the construction of 
 those vessels primarily engaged in opposing submarines, whose 
 life-saving appliances and methods suited to recognized condi- 
 tions of naval warfare had to be materially modified. Then, 
 again, the Navy had only a moderate supply of guns and am-
 
 WORKING FOR THE GOVERNMENT 63 
 
 munition for arming naval auxiliaries that were taken into 
 the service. As for defensive weapons to protect merchant 
 vessels when Germany undertook their indiscriminate sinking, 
 not only necessary guns but also skilled gun crews had to be 
 provided. 
 
 All this preparation was accompanied by an incessant cry 
 from the Navy as from the Army for skilled men, and then 
 more*skilled men, as the requirements of modern warfare came 
 more and more to depend for their success upon these engine- 
 men, mechanics, machinists, boilermakers, shipwrights, ship- 
 fitters, carpenters, riveters, caulkers, blacksmiths, coppersmiths, 
 sheet metal workers, pattern makers, molders, water tenders, 
 bricklayers, masons, and so on. The modern battleship, for 
 instance, requires thirty-eight machinists' mates to operate the 
 machinery and keep it in repair, and these men must be skilled 
 artificers. Their supply in the labor market was early in the 
 war completely exhausted and then recourse was had to work- 
 ers not so skilled but machinists who were trained in a rea- 
 sonably short time to operate the engines, thus permitting a less 
 number of machinists' mates. The pattern maker and the 
 molder filled an equally urgent need on repair ships inasmuch 
 as under war conditions ships had to be kept at all times fully 
 prepared for immediate active duty and thus could not return 
 to the navy yard while it was at all possible for repairs beyond 
 the capacity of the force on board to be made by the personnel 
 on the repair ships. 
 
 Thus is indicated the important fact that thousands of 
 workers were enlisted in the Navy in occupations and positions 
 other than that of those who actually did the fighting. The 
 same is true of the Army. 
 
 The Signal Corps, for illustration, enlisted bricklayers to 
 build airdromes in France in which to house Amerca's flying 
 army overseas. These mechanics were so urgently needed in 
 large numbers at the very beginning of the war that recruiting 
 officers were given special instructions to enlist every man 
 possible for this service. These men upon enlistment were
 
 64 THE WORKERS AT WAR 
 
 sent to concentration training camps in the South and there 
 organized into squadrons for immediate transportation to 
 France. Provision was made for them to become non-com- 
 missioned officers. Their salary ranged from thirty dollars 
 to fifty-one dollars a month with a 20 per cent, bonus for 
 foreign service, and in addition food, lodging, and uniform. 
 
 Industrial employment of workers enlisted as soldiers is also 
 indicated in the formation of forest regiments. Each regi- 
 ment of woodsmen numbered about twelve hundred men, com- 
 prising ten battalions, and their task was to supply from the 
 forests of France lumber material for the use of the American 
 Army, such as cross-ties ; bridge, trench, and construction tim- 
 ber ; mine props ; and lumber and other forms of wood essential 
 to military operations. These regiments required skilled lum- 
 ber-jacks, sawers, axmen, portable saw-mill operatives, tie cut- 
 ters, loggers, logging teamsters, millwrights, filers, stationary 
 engineers, charcoal burners, boiler makers, truck and tractor 
 operatives, and so on. Nine so-called service battalions made 
 up of laborers employed in connection with the forest regiment 
 had also been authorized by September, 1917. The officers 
 were trained in established camps. 
 
 In January, 1918, recruiting for the Twentieth Engineers' 
 Regiment of six thousand additional men for forest and rail- 
 road work was being completed. This second forest regiment 
 had the distinction of being the largest regiment in the world. 
 Three thousand of the men were skilled in all kinds of work 
 having to do with the operation of saw-mills and with the 
 building and operation of logging railroads. The remaining 
 three thousand made up three road and bridge-building bat- 
 talions to serve as auxiliary to the logging and saw-mill units. 
 These road building battalions were composed of men who 
 were familiar with rock crushers, road rollers, scrapers, grad- 
 ers, motor-truck driving, and the work of common laborers. 
 There were also such workers as tracklayers, track bosses, lo- 
 comotive engineers and firemen, brakemen, machinists, and so 
 on.
 
 WORKING FOR THE GOVERNMENT 65 
 
 By June, 1918, there had been organized five new regiments 
 and nineteen battalions of railway engineers in addition to sim- 
 ilar regiments already abroad. This meant that approximately 
 fifty thousand American workingmen were engaged in the 
 work of railroad construction and operation in France. The 
 organization of the first railway regiment was early in 1917 
 when six railroads having headquarters in Chicago recruited 
 one company each. In May, 1917, steps were taken to or- 
 ganize eight other similar regiments. One of the very first 
 requests transmitted to the United States Government by 
 France after America had entered the war was for assistance 
 in strengthening the French railway system to meet the in- 
 creasing war strain. Among the railway supplies sent from 
 this country were 1727 engines, 22,630 freight cars and 359,- 
 ooo tons of steel rails. In addition there were vast quantities 
 of rail fastenings, turn-outs, ties, and other track material, 
 as well as the supplies required in building terminals. Much 
 of the task performed by these workers had to do with the con- 
 struction of terminals and terminal facilities, including wharfs, 
 docks, and lighterage at the water front, switching facilities 
 at inland points, round houses, and so on. 
 
 Similarly other workers enlisted as soldiers actually engaged 
 in industrial pursuits, in this country as well as in the war ter- 
 ritory in France, indicating still further the extraordinary ex- 
 tent of the demand for skilled workers for military service 
 other than that of the strictly fighting branches of the Army 
 and Navy. 
 
 The exigencies of the war also brought wholly unexpected 
 demands for workers in entirely new fields of endeavor. For 
 illustration, the Signal Corps of the Army needed men trained 
 in photographic work. To secure them a school for aerial pho- 
 tography with a course of training covering four weeks was 
 established at Rochester, New York. These workers included 
 laboratory and dark room experts and especially fast news 
 photographers familiar with developing, printing, enlarging, 
 retouching, finishing, and panchromatic photography men
 
 66 THE WORKERS AT WAR 
 
 who could take a plate from the airmen and produce from it 
 ten minutes later a finished enlargement. Others of these 
 workers were camera and optical construction and repairmen, 
 lens experts, cabinet makers, instrument makers, and so on 
 skilled mechanics who could keep the whole delicate equipment 
 in good condition. Still others were experts familiar with 
 map compilation, map reading and interpretation, topographical 
 science, and drafting, and possessing trained analytical powers 
 men who could fit the finished prints into their proper places 
 in the photographic reproduction of the German front, work 
 out the information disclosed, and keep the whole map a 
 living hour-to-hour story of the things the Germans were do- 
 ing about which American commanders should know. 
 
 Then, there were the workers in -camouflage, the latest of the 
 arts of military concealment. Special camouflage companies 
 were organized comprising iron workers, sheet metal workers, 
 carpenters, cabinet makers, stage carpenters, property men, 
 plaster molders, photographers, scene painters, sign painters, 
 and the like. The task of these workers was to set up dummy 
 cannon for the eyes of the hostile aeroplanes ; to make old boots 
 and broken stakes from destroyed barbed-wire entanglements 
 conceal periscopes ; to produce a papier-mache steel-lined coun- 
 terfeit of a dead horse or a shell-blasted tree trunk; to trans- 
 form the roofs of aeroplane sheds so that from above they 
 appeared to be wheat fields and the tops of railroad trains. so 
 that to the occupants of hostile aeroplanes they looked like 
 workingmen's cottages. Even the* painting of canvas above 
 a bridge while it was being constructed, so as to make the 
 canvas appear as a river and concealing the bridge beneath, 
 was Jiot beyond the requirements demanded of camouflage 
 workers. 
 
 These workers of America these toilers in mines and mills 
 and shops and yards and offices and plants and factories and 
 storage depots and lumber camps, and on the farms and rail- 
 roads, and at the piers and wharfs and docks of the ports of 
 debarkation, and in the hulls of ships, and wherever in fact
 
 WORKING FOR THE GOVERNMENT 67 
 
 the wheels of industry and of production had to be kept mov- 
 ing these men and women "in the second line of trenches" 
 were fighting the Imperial German Government just as effec- 
 tively as their blood-brother soldiers and marines in the first 
 line of battle. Their activities were controlled and guided 
 and they were moved to intensity of action by the same mo- 
 tives and impulses that operated upon the men in olive drab 
 and navy blue. They, too, were serving their country in its 
 hour of need they, too, were working for their Government. 
 
 This is true literally as well as figuratively. The United 
 States Government actually became the immediate employer 
 of millions of men and women and indirectly of many other 
 millions. It took over direct control and operation of the rail- 
 roads of the country with their 2,000,000 employes, and of 
 the telegraph and telephone lines; it built ships direct through 
 its United States Shipping Board Emergency Fleet Corporation 
 and the Navy Department; it constructed dwellings through 
 its United States Housing Corporation and other buildings 
 through the War and Navy Departments ; it controlled the pro- 
 duction of coal through the United States Fuel Administration, 
 and in most of the cases where production was continued by 
 privately owned industries, even these were operated under 
 contract with the Government. 
 
 A vast nation-wide industry operating on a scale of hereto- 
 fore inconceivable magnitude under direct Government super- 
 vision, had to be created, organized, correlated, and made to 
 function in the production and distribution of an adequate 
 supply of food, of clothes, of equipment, of munitions, and of 
 transportation to the firing line. This meant that virtually 
 every industry in the entire country every mine and mill and 
 plant and factory from the smallest to the largest had to be 
 made to fit in with the needs of the fighting forces. At the 
 same time there were the needs of the civilian population that 
 could not be ignored or neglected. Not only America's actual 
 industrial power but America's potential productivity in prac- 
 tically all lines of human endeavor in the transformation of
 
 68 
 
 raw material into the finished product had almost immediately 
 to be stretched even beyond that conceivable potentiality. It 
 was an urgent necessity that peace time production in many 
 Jines be multiplied a hundred and even a thousand fold and 
 translated almost instantly into terms and instrumentalities of 
 military effectiveness. Organization to this end had to be 
 made to come out of America's unorganized mass of available, 
 resources. The emergency was so great as not to permit of an 
 alternative. It was such as to demand that the National Gov- 
 ernment itself take complete control of production and dis- 
 tribution. And this it did.
 
 CHAPTER VII 
 
 THE GOVERNMENT AS THE EMPLOYER 
 
 WITH the Government the national employer, either di- 
 rectly or indirectly, of virtually the greater number of 
 all the workers, and with all male citizens of military age sub- 
 ject to its orders, it was in a position, as it was under the neces- 
 sity, of organizing them into what was practically a nation- 
 wide workshop under one centralized authority and with but 
 one purpose, that purpose being victory over the Imperial 
 German Government. Its primary task was to select out the 
 soldiers from among the male citizens, and in the direction of 
 accomplishing this Congress enacted the Selective Service Act 
 of May 18, 1917, which affected all male citizens between the 
 nges of twenty-one and thirty. 
 
 The purpose of this legislation in its broader aspects was 
 succinctly stated by President Wilson in his Proclamation fix- 
 ing June 5 as the date for registration : 
 
 " In the sense in which we have been wont to think of 
 armies," said the President, " there are no armies in this strug- 
 gle. There are entire nations armed. Thus the men who 
 remain to till the soil and man the factories are no less a part 
 of the army that is in France than the men beneath the battle 
 flags. It must be so with us. It is not an army that we must 
 shape and train for war ; it is a nation. To this end our people 
 must draw close in one compact front against a common foe. 
 But this cannot be if each man pursues a private purpose. All 
 must pursue one purpose. The Nation needs all men ; but it 
 needs each man, not in the field that will most pleasure him, 
 but in the endeavor that will best serve the common good. 
 Thus, though a sharpshooter pleases to operate a triphammer 
 for the forging of great guns, and an expert machinist desires 
 to march with the flag, the Nation is being served only when the 
 
 69
 
 70 THE WORKERS AT WAR 
 
 sharpshooter marches and the machinist remains at his levers. 
 The whole Nation must be a team in which each man shall 
 play the part for which he is best fitted. To this end, Congress 
 has provided that the Nation shall be organized for war by 
 selection and that each man shall be classified for service in the 
 place to which it shall best serve the general good to call him. 
 
 " The significance of this can not be overstated. It is a new 
 thing in our history and a landmark in our progress. It is a 
 new manner of accepting and vitalizing our duty to give our- 
 selves with thoughtful devotion to the common purpose of us 
 all. It is in no sense a conscription of the unwilling, it is 
 rather selection from a nation which has volunteered in mass. 
 It is no more a choosing of those who shall march with the 
 colors than it is a selection of those who shall serve an equally 
 necessary and devoted purpose in the industries that lie behind 
 the battle line. The day here named is the time upon which all 
 shall present themselves for assignment to their tasks." 
 
 The act of May 18 authorizing the President to increase the 
 Military Establishment of the United States looked to three 
 sources for the Army which it 'created. First, it provided for 
 an increase in the Regular Army from 250,157 men and officers 
 on June 30, 1917, to 488,218, this increase being effected by the 
 immediate call of the increments provided in the National 
 Defense Act of 1916 and the raising of all branches of the 
 service to war strength. Second, the National Guard, reor- 
 ganized under the National Defense Act and containing 1 11,123 
 officers and enlisted men on June 30, 1917, was to be recruited 
 to full war strength of 470,177 officers and enlisted men. 
 Third, a new National Army was to be created through the 
 process of selective conscription or draft, the President being 
 empowered to summon two units of 500,000 men each at such 
 time as he should determine. 
 
 Next in importance only to this paramount military necessity 
 were the economic needs of the nation for man power. This 
 meant that men whose removal to the army would interfere 
 seriously with industrial and agricultural pursuits should be 
 taken in the order in which they could best be spared. As the 
 military needs required that there be provided in every com-
 
 THE GOVERNMENT AS THE EMPLOYER 71 
 
 raunity a list of names of men who would be ready at any time 
 to be called into service, so the industrial demands made it 
 most essential that there should also be accessible the names 
 and industrial qualifications of all men. Thus the man power 
 of the country needed to be classified for two distinct pur- 
 poses, each of vital importance to the winning of the war. 
 
 The experience of Great Britain and France, and particularly 
 that of England, had proven how vitally important it was to 
 prevent those men being drafted into military service who were 
 indispensable to the- steady flow of munitions of war and of 
 commodities necessary to maintain the working and civilian 
 population. At the beginning of the war Great Britain had 
 rushed men to the front regardless of whether they were neces- 
 sary in munitions and other production, with the result that 
 when the Army was- in the trenches needless loss of life resulted 
 because the men were not sufficiently supplied with arms. This 
 brought England to a tardy recognition of the fact that men 
 in munitions plants were just as essential as men on the firing 
 line. Then began the intricate and tedious process of filter- 
 ing out from among the fighting forces the skilled mechanic 
 to do the munitions work. America fortunately learned a 
 valuable lesson from England's experience. 
 
 With this in mind the selective draft law made provision 
 for classifying the names of all men liable to service. These 
 were next arranged in five groups in the inverse order of their 
 importance to the economic requirements, these latter including 
 the maintenance of essential industries and agriculture and the 
 support of dependents. All this was provided. for in the en- 
 forcement of the registration and draft acts. The order of 
 liability to military service was determined by the national lot- 
 tery drawing at Washington to which reference has already 
 been made. 1 This assigned by number to every registrant in 
 every community an order of availability for such service rela- 
 tive to all other men not permanently or temporarily exempted 
 or discharged. The effect of classification in Class I, for il- 
 1 Chapter IV, page 35.
 
 72 THE WORKERS AT WAR 
 
 lustration, was to render every man so classified almost im- 
 mediately liable to military service, but in the order determined 
 by the national drawings. The effect of classification in Class 
 II was to grant a temporary discharge from the draft effective, 
 however, only until Class I was exhausted ; so with those mak- 
 ing up Classes III and IV. The effect of classification in Class 
 V was to grant exemption or discharge from the draft 
 
 Thus in the administration of the Selective Service Law for 
 filling the ranks of the armies an effort was made to strike a 
 balance between the military necessity and the industrial and 
 agricultural or economic needs of the Nation by which men 
 would be placed in the service or occupation that best served 
 the common good. The need for men was in relative impor- 
 tance as follows: I, military service; 2, manufacture of arms, 
 munitions, and like means of warfare; 3, production of food 
 and fuel supplies for ourselves and our allies ; 4, operation of 
 the railroads and the construction and operation of ships. 
 
 The Priorities Board of the War Industries Board, in formu- 
 lating a list of preferred industries, established thirty-two 
 classes as comprising a preference list that supplied the key to 
 the relative importance of all the country's manifold industrial 
 enterprises. The values were established by surveys as to the 
 nation's needs and, once established, the list was maintained 
 by a system of priority in determining the use of the six basal 
 elements of industry. These elements the board stated as be- 
 ing material, facilities, fuel, transportation, labor, and capital. 
 
 The problem of the Government as the employer was a 
 shortage of workers. Not so much a shortage in numbers 
 but because the peace-time workers were not in the positions 
 demanded by war-time production. Putting the situation an- 
 other way the Government was called upon to accomplish 
 immediately a greater amount of work absolutely essential to 
 the winning of the war than there were men and women in 
 the positions it was necessary for them to be in to perform that 
 work. Its primary task, therefore, was to get them in these 
 positions at the earliest possible moment.
 
 THE GOVERNMENT AS THE EMPLOYER 73 
 
 At the beginning of America's participation in the war the 
 manufacturing plants of the country had no large resources, 
 owing to domestic consumption and unusual foreign orders. 
 In the equipment of its armies the United States had to depend 
 almost entirely upon its own resources, and to have expected 
 its peace-time industries to house, clothe, feed, equip, and 
 transport these millions of men would have been to expect the 
 impossible. Many industries, some of them entirely new to 
 American workers, had to be quickly organized and in hun- 
 dreds of instances additional factory and plant facilities had 
 to be provided for peace-time industries. Along with the 
 process of mobilization in manufacturing had to go a radical 
 readjustment of all trade channels of demand and supply. 
 
 The Provost Marshal General in his report January, 1918, 
 to the Secretary of War on the operation of the Selective 
 Service Act stated that the needs of the war had resulted in an 
 unprecedented demand for labor in the vital fields of (i) ship- 
 building and operation, (2) munitions manufacture, and (3) 
 agriculture. 
 
 " The guiding principle of this office," he stated, " must be 
 ' military effectiveness first,' but when military effectiveness 
 is enmeshed with marine effectiveness, as it must be in a foreign 
 war on a battlefield three thousand miles from our coast line, 
 there is no room for hesitation. If our soldiers are to be 
 effective, if the munitions we produce are to be effective, if our 
 agricultural productiveness is to be effective, we must produce 
 the bottoms to carry all abroad. . . . Since we are in war 
 military effectiveness comes first, but there never was a more 
 fortunate corollary for the Nation than that marine effective- 
 ness comes next. However, soldiers are helpless without 
 weapons, and what has been said can never be taken to mean 
 that the manufacture of munitions is to be hampered by the 
 building of ships or the disproportionate raising of armies. 
 
 " All of these things are to be carried synchronously forward, 
 and the problem is simply one of relative adjustment from 
 month to month and year to year, with no thought of carrying 
 one to a disproportionate prejudice of the other. The same 
 is true of agricultural productiveness. The problem i^ to 
 carry each evenly forward, avoiding the destruction of any.
 
 74 THE WORKERS AT WAR 
 
 It must not be forgotten, however, that the problem does not 
 stop here. The entire effectiveness of the Nation has not been 
 envisioned when we have mentioned the manufacture of the in- 
 struments of war, the instrumentalities for the overseas trans- 
 portation of them, and the men who are to manipulate them. 
 The Nation must be an economic integer and a very effective 
 one, and all is by no means said when these essentials are men- 
 tioned." 
 
 Towards the accomplishment of this the Selective Service 
 Act was an instrument of compelling force in controlling the 
 labor supply throughout the United States and in distributing 
 it ill the strategic industries. By means of this act the entire 
 industrial field was explored, provision of facile and effective 
 methods perfected, and supple control exercised in coordinat- 
 ing the man power of the Nation and fostering the industries 
 in an impartial balance that would carry forward all the varied 
 endeavors to a successful fruition. An illustration of this is 
 the granting of immunity from the draft to workers employed 
 in the construction and fitting out of ships under the control 
 of the Navy Department and the Emergency Fleet Corporation 
 of the United States Shipping Board whe,n it became evident 
 beyond dispute that there were not enough men in the ship- 
 yards to carry forward the projects. The immediate effects 
 were such as to remove the serious shortage of labor that had 
 prevailed in shipbuilding. 
 
 Under the operation of the Selective Service regulations the 
 Government was able to secure a complete inventory of the 
 man power of the country, including information as to the 
 qualifications and industrial and domestic circumstances of 
 each registrant. There was also secured a definite classifica- 
 tion of all registrants into the five classes provided for accord- 
 ing to their relative availability for military service with re- 
 gard to their industrial, agricultural, and domestic importance 
 to the Nation. This permitted the deferment of skilled, key, 
 and pivotal men essential to the industries. It also enabled 
 as many as 240,000 transfers of men from one unit to another 
 to take place in Army camps up to June, 1918. At that time
 
 THE GOVERNMENT AS THE EMPLOYER 75 
 
 these transfers were averaging forty thousand a week. An 
 organization existed in each Army camp by which enlisted men 
 and commissioned officers were classified according to occu^ 
 pational qualifications. The central personnel bureau at 
 Washington received reports soon after the arrival at camp of 
 each draft increment, showing the number of skilled and semi- 
 skilled men in different occupations, thus enabling quick trans- 
 fers to the Signal Corps, Ordnance, Quartermaster, and other 
 corps of the Army and the supporting industries which were 
 constantly calling for specially skilled men. Among these 
 transfers were mechanics of all kinds, chauffeurs, chemists for 
 gas defense work, physicists and meteorologists for aviation 
 purposes, surgical instrument repairers, bacteriologists, map 
 draftsmen, refrigeration experts, crane operators, foresters, 
 railroad builders, railway shop workmen, accountants, gun- 
 smiths, and ordnance specialists and workmen -for engineer 
 regiments, and so on. 
 
 There was also created by the Selective Service regulations 
 a committee on education and special training under the direc- 
 tion of the Chief of Staff. This committee's task was to study 
 the Army's needs for skilled men and technicians, to determine 
 how such needs could best be met, to secure the cooperation of 
 the educational institutions of the country, to represent the 
 War Department in its relations with such institutions, and 
 to administer a plan of special training in schools and colleges. 
 It also encouraged and arranged for the technical education of 
 needed men. Associated with the committee was an advisory 
 civilian board of educators. 
 
 The Federal Board for Vocational Education was organized 
 in July, 1917, for the purpose of organizing vocational educa- 
 tion work in the forty-eight States and in other ways assist 
 the war-making branches in training men for special duties. 
 Classes for conscripted men were instituted in the public 
 schools; emergency training courses for Army occupations 
 were prepared for use under direct supervision of the board, 
 in classes organized by the War Department among enlisted
 
 76 THE WORKERS AT WAR 
 
 men, and for classes conducted on a commercial basis under 
 private civilian control. These courses were for men in me- 
 chanical and technical occupations in the air service of the 
 Signal Corps, shipyard workers, motor-truck drivers, chauf- 
 feurs, machine shop operatives, blacksmiths, sheet metal work- 
 ers, pipe fitters, electricians, telephone repairmen, linemen, 
 cable splicers, gas enginemen, motor car and motorcycle repair- 
 men, oxyacetylene welders, airplane mechanics, engine repair- 
 men, wood workers, riggers, and so on. By June, 1917, 
 twelve thousand men had been trained for vocational educa- 
 tion and turned over to various war service departments, these 
 men comprising six thousand in mechanical lines, five thousand 
 in radio work for the Army, Navy, and mercantile marine, 
 and one thousand in clerical occupations for the Quartermaster 
 Corps. 
 
 All this registering, classifying, sorting, transferring, and 
 training by the Government was necessary in order to place 
 the men and women workers in the positions in the military 
 branches and in the industrial pursuits where they could best 
 serve the Nation. It was an unprecedented task and was per- 
 formed unprecedentedly well. But it was only a small part 
 of the complete task set for the Government. 
 
 After the worker was placed, what was to be his or her re- 
 lation and that of the Government towards all those disputed 
 and vexatious and troublesome questions of employment which 
 for years had been in controversy between employer and em- 
 ploye and which are concretely summarized as the labor prob- 
 lem? As to the workers in the strictly military branches, this 
 relation was determined by statute. But with regard to the 
 millions in industrial pursuits employed directly by some de- 
 partment or bureau of the Government or by some corporation 
 of contractor working directly for the Government, there was 
 no provision by statute for determining this relation. Sud- 
 denly and unexpectedly the National Government had been 
 forced into the position of the employer. What kind of an 
 employer was it to be ?
 
 THE GOVERNMENT AS THE EMPLOYER 77 
 
 If all at once you were compelled to become the principal 
 employer of the workingmen in the United States what policy 
 would you make effective as to the wages you paid and the 
 terms and conditions of employment you imposed upon or ex- 
 acted from your workers? This is the question the United 
 States Government was called upon to decide almost immedi- 
 ately upon the declaration of war against the Imperial Ger- 
 man Government in April, 1917. 
 
 Would you, in conference with your employes, provide for 
 them a properly constituted tribunal where all disputed ques- 
 tions affecting their employment were decided fairly and im- 
 partially? Or would you dogmatically assume to decide such 
 questions yourself and tell your workers that if they did not 
 like your decision they could get employment elsewhere? 
 
 Would you demand of your employes that they work four- 
 teen or twelve or even ten hours each day? Or would you fix 
 the length of the work-day in consultation with your workers 
 at eight hours ? Would you require them to work on Sundays 
 and holidays? And if you did, or if you required them to 
 work more than eight hours each day, would you pay them 
 time and one-half or double time wages for all extra hours 
 they worked ? 
 
 Would you increase their wages? If so what standard of 
 measurement would you make use of to determine the amount 
 of increase? Would the increase in the cost of living to your 
 employes be a matter of concern to you ? \Vhat relation would 
 you make this increase bear to their wages? 
 
 Would you " recognize the union," that is, would you discuss 
 with representatives of the organization of your employes 
 through joint or collective bargaining machinery the multi- 
 tudinous questions of employment that come up between em- 
 ployers and employes? Perhaps you would refuse to permit 
 your employes even to organize a union! It may be that you 
 would declare for the " open shop " so-called ! 
 
 As the employer, would you concern yourself with measures 
 for the prevention of accidents to your employes while at work?
 
 78 THE WORKERS AT WAR 
 
 With the conservation of their health? W r ith the securing of 
 sanitary conditions in their work places ? With the protection, 
 through old age pensions and the like, of faithful employes 
 who were no longer able to work for you? With the safe- 
 guarding of your employes against the terrible effects of un- 
 employment? \Vith the unusual problems arising from the 
 industrial employment of women and children? 
 
 Would your employes participate in the management of that 
 particular part of your business which bears directly upon 
 matters concerning their employment? Would they partici- 
 pate in your surplus profits? Would you have shop commit- 
 tees? 
 
 In brief, What kind of an employer would you be? A be- 
 liever of autocracy or of democracy in industry ? 
 
 It was the answer the Wilson Administration gave to these 
 questions that was responsible, in large part, for the successful 
 performance by the American workingman of the stupendous 
 task he was called upon to accomplish in the winning of the 
 war.
 
 CHAPTER VIII 
 THE WILSON ADMINISTRATION'S LABOR POLICY 
 
 ATHWART the channels of strikes and lockouts and like 
 interruptions to and limitations upon the continuous pro- 
 duction of commodities and services, which the course of the 
 labor movement the past several decades preceding the Euro- 
 pean war had cut deep into the processes of industry, the Gov- 
 ernment as the national employer was now called upon to pro- 
 vide a means of passage. It requires an unusually high de- 
 gree of statesmanship to perceive clearly, through the murk 
 of internal differences and disputes between classes or groups, 
 the one thing necessary in order to accomplish a desired end 
 and to apply successfully that particular remedy. The Wil- 
 sonian statesmanship as applied to the disturbed labor situa- 
 tion was of this character. 
 
 Among the more important industrial controversies in prog- 
 ress in this country when the United States declared war, were 
 the acute labor disputes in the coal mines of Pennsylvania, af- 
 fecting 80,000 mine workers, and of Alabama, involving 25,000 
 other mine employes ; in the shops of the Southwestern group 
 of railroads affecting 42,000 mechanics; in the shipyards of the 
 Atlantic and Pacific Coast States involving nearly 300,000 
 men ; in the meat packing industry of Chicago but affecting this 
 food supply of the entire country ; in the copper mines of Ari- 
 zona ; in the oil fields of southern California: in the telephone 
 industry of Washington, Oregon, California, Idaho, and Ne- 
 vada ; in the lumber industry of the Pacific Northwest ; among 
 virtually all classes of employes of the railroads ; and numer- 
 ous other less important disturbances in different industries 
 in all parts of the country. 
 
 79
 
 8o THE WORKERS AT WAR 
 
 " The war can be lost in America as well as on the fields of 
 France," the President saw distinctly, 1 and he also perceived as 
 clearly that " ill-considered or unjustified interruptions of the 
 essential labor of the country " would bring this dire result. 
 The duty " to avoid such interruptions to industry wherever 
 they can be avoided without the actual sacrifice of essential 
 rights rests upon the employer as imperatively as upon the 
 workman," he said. " No man can afford to do injustice at 
 any time but at this time justice is of the essence of national 
 defense, and contests for any sort of advantage that at other 
 times would be justified may now jeopardize the very life of 
 the Nation." Therefore, " no controversy between capital and 
 labor should be suffered to interrupt " the essential labor of the 
 country " until every instrumentality set up by the Government 
 for its amicable settlement has been employed and its inter- 
 mediation heeded to the utmost; and the Government has set 
 up instrumentalities wholly fair and adequate." 
 
 " To stand together," said the President in an address before 
 the American Federation of Labor convention at Buffalo No- 
 vember 12, 1917, " means that nobody must interrupt the proc- 
 esses of our energy if the interruption can possibly be avoided 
 without the absolute invasion of freedom. To put it con- 
 cretely, that means this : Nobody has a right to stop the proc- 
 esses of labor until all the methods of conciliation and settle- 
 ment have been exhausted. And I might as well say right here 
 that I am not talking to you alone. You sometimes stop the 
 courses of labor, but there are others who do the same, and I 
 believe that I am speaking from my own experience not only, 
 but from the experience of others when I say that you are 
 reasonable in a larger number of cases than the capitalists, 
 am not saying these things to them personally yet, because I 
 have not had a chance, but they have to be said, not in any 
 spirit of criticism, but in order to clear the atmosphere and 
 come down to business. Everybody on both sides has now 
 got to transact business, and a settlement is never impossible 
 when both sides want to do the square and right thing. 
 
 * Telegram to the St. Paul convention of the American Alliance for 
 Labor and Democracy, June n, 1918.
 
 WILSON ADMINISTRATION'S LABOR POLICY 81 
 
 " Moreover, a settlement is always hard to avoid when the 
 parties can be brought face to face. I can differ from a man 
 much more radically when he is not in the room than I can 
 when he is in the room, because then the awkward thing is he 
 can come back at me and answer what I say. It is always 
 dangerous for a man to have the floor entirely to himself. 
 Therefore, we must insist in every instance that the parties 
 come into each other's presence and there discuss the issues 
 between them and not separately in places which have no com- 
 munication with each other. . . . 
 
 " We are all of the same clay and spirit, and we can get 
 together if we desire to get together. Therefore, my counsel lo 
 you is this : Let us show ourselves Americans by showing that 
 we do not want to go off in separate camps or groups by our- 
 selves, but that we want to cooperate with all other classes and 
 all other groups in the common enterprise which is to release 
 the spirits of the world from bondage. I would be willing to 
 set that up as the final test of an American. That is the mean- 
 ing of democracy. The fundamental lesson of the whole situa- 
 tion is that we must not only take common counsel, but that we 
 must yield to and obey common counsel." 
 
 As production of vitally essential commodities for the suc- 
 cessful prosecution of the war was being seriously interfered 
 with by the disturbed labor conditions, there were two funda- 
 mentally important acts the Government was clearly called 
 upon to perform by the facts and the logic of the industrial 
 situation which confronted the people at the outset of their 
 participation in the war. The first of these acts was to find 
 out by investigation what were the direct operating causes of 
 this interruption, and the second was to apply a remedy. 
 
 In carrying out the determination of the Government to omit 
 nothing which might aid in the immediate adjustment of all 
 disturbances of every character in progress throughout the 
 country, the President appointed a commission early in the 
 war. 1 " I have listened with attention and concern to the 
 
 1 The members of the commission were William B. Wilson, Secre- 
 tary of Labor; J. L. Spangler of Pennsylvania, Verner Z. Reed of 
 Colorado, John H. Walker of Illinois, and E. P. Marsh of Washington.
 
 82 THE WORKERS AT WAR 
 
 numerous charges of misconduct and injustice that representa- 
 tives both of employers and of employes have made against 
 each other," says the President's official memorandum. 1 " I 
 am not so much concerned, however, with the manner in which 
 they have treated each other in the past as I am desirous of 
 seeing some kind of a working arrangement arrived at for the 
 future, particularly during the period of the war, on a basis 
 that will be fair to all parties concerned." 
 
 It was the task of the commission to visit, in each instance, 
 the governor of the State and advise him that they were there 
 as the personal representative of the President of the United 
 States with a view to lending sympathetic counsel and aid to 
 the State government in the development of a better under- 
 standing between employes and employers. The commission 
 was also to deal with employers and employes in a conciliatory 
 spirit, seek to compose differences and allay misunderstanding, 
 and in any way that might be open to them to show the active 
 interest of the National Government in furthering arrange- 
 ments just to both sides. Wherever it was deemed advisable 
 conferences of employers and employes were to be called with 
 the purpose of working out a mutual understanding between 
 them which would insure the continued operation of the indus- 
 try on conditions acceptable to both sides. The commission was 
 also to learn the real causes for any discontent which existed on 
 either side, not so much by the formal process of public hear- 
 ings but by getting into touch with workmen and employers 
 by the more informal process of personal conversation. 
 
 This commission had particularly to do with industrial con- 
 troversies already in progress or about to be precipitated, and 
 especially concerning such labor conditions in the mountain 
 region of the Northwest and on the Pacific Coast. It reported 
 at some length in January, 1918, the results in specific labor 
 adjustments which it had undertaken, an analysis of the diffi- 
 culties and tendencies making for industrial instability, and 
 recommended a policy as to the direction that should be taken 
 1 Published September 20, 1917,
 
 WILSON ADMINISTRATION'S LABOR POLICY 83 
 
 in labor matters during the period of the war. The specific 
 labor disputes referred to were the strikes in the copper mines 
 of Arizona, the unrest in the lumber industry of the Pacific 
 Northwest, the threatened strike in the oil fields of southern 
 California, on the telephone lines of the Pacific States, and in 
 the packing industry centering in Chicago, and the general 
 labor unrest in the shipbuilding and aircraft production indus- 
 tries. As to each of these situations the report set forth the 
 existing relation of employers and employes, the causes of the 
 unrest, the steps necessary for the removal of such causes, a 
 history of the strikes, the nature of the settlement where adjust- 
 ment was made by the commission, and how this settlement 
 was working. 
 
 Into each situation, backed by the authority of the National 
 Government, and supported by the patriotism of both employ- 
 ers and employes, the commission simply injected the instru- 
 mentality of industrial democracy which the preceding forty 
 and more years of the labor movement had built up. This 
 was the institutional machinery for joint bargaining. It pre- 
 supposes not only the existence of an organization of the work- 
 ers, for without such organization joint or collective bargain- 
 ing between employer and employe is an impossibility, but also 
 the " recognition " of this organization and its representatives 
 on the part of the employer. Such machinery, under the su- 
 pervision of an impartial federal administrator, was established 
 in the telephone industry of the Pacific Coast States, in the 
 southern California oil fields, in the Chicago meat packing in- 
 dustry, and in the copper mines of Arizona. A brief summary 
 of the settlement of the labor controversy in the copper indus- 
 try can be taken as an illustration. 
 
 There was established for each mine a worker's grievance 
 committee entirely free from all direct or indirect influence of 
 the company. This committee was composed exclusively of 
 men working at each mine, with the right of members of the 
 union to have a union representative in the presentation of 
 grievances. There was to be no discrimination against an
 
 84 THE WORKERS AT WAR 
 
 employe because he belonged to the union. Appeal to a United 
 States Government administrator was provided for whose de- 
 cision was binding on both parties on all disputed questions 
 of fact as to which the management and employes could not 
 agree. Old and new grievances were promptly heard, in one 
 district as many as two hundred and fifty being disposed of in 
 five weeks. Not a few of these were naturally found to be triv- 
 ial or groundless they were an inheritance of the preceding 
 condition of autocratic domination by the corporation. 
 
 Re-employment was effected of those employes who went out 
 on strike, except those guilty of seditious utterances against the 
 United States or those having membership in an organization 
 which did not recognize the obligation of a contract. In pro- 
 viding for re-employment the district instead of the individual 
 mine was treated as an industrial unit, re-employment being 
 secured through a central employment committee for the dis- 
 trict. The question of a wage increase was left to the Gov- 
 ernment administrator after an investigation of the facts. The 
 machinery thus provided was designed to prevent strikes and 
 lockouts, and was to be in effect during the period of the war. 
 
 For the purpose of formulating a national labor policy and 
 for devising and proyiding a method of labor adjustment which 
 would be acceptable to employers and employes at least for 
 the war emergency period, the Wilson administration created 
 on January 28, 1918, the War Labor Conference Board con- 
 sisting of five representatives of employers, five representa- 
 tives of employes, and two of the general public. Among the 
 five representatives of employers were four who had never 
 dealt with organized labor in the conduct of their industries. 
 The five representatives of the employes were officials of na- 
 tional and international labor unions whose members were al- 
 most entirely engaged in war production. The members of the 
 board were appointed by the Secretary of Labor upon nomina- 
 tion by the president of the National Industrial Conference 
 Board, an organization of employers, and the president of 
 the American Federation of Labor, the latter representing all
 
 WILSON ADMINISTRATION'S LABOR POLICY 85 
 
 the more important labor unions of the country with the ex- 
 ception of the four railway brotherhoods whose members were 
 engaged in the operation of trains. Each of the two groups 
 thus selected chose one of the two representatives of the 
 public. 1 
 
 This board presented a formulation of industrial principles 
 which represented the Administration's labor policy and which 
 were to govern the relations between workers and employers in 
 war industries for the duration of the war. These principles 
 are as follows: 
 
 There should be no strikes or lockouts during the war. 
 
 The right of workers to organize in trade unions and to 
 bargain collectively through chosen representatives is recog- 
 nized and affirmed. This right shall not be denied, abridged, 
 or interfered with by the employers in any manner whatsoever. 
 
 The right of employers to organize in associations of groups 
 and to bargain collectively through chosen representatives is 
 recognized and affirmed. This right shall not be denied, 
 abridged, or interfered with by the workers in any manner 
 whatsoever. 
 
 Employers should not discharge workers for membership in 
 trade unions, nor for legitimate trade union activities. 
 
 The workers, in the exercise of their right to organize, shall 
 
 1 The members of the board were Mr. L. F. Loree, president of the 
 Delaware and Hudson Railroad Company; Mr. Loyall A. Osborne, 
 vice-president of the Westinghouse Electric and Manufacturing Com- 
 pany; Mr. C. Edwin Michael, president of the Virginia Bridge and 
 Iron Company; Mr. W. H. Van Dervoort, president of Root and Van 
 Dervoort Engineering Company; and Mr. B. L. Worden, vice-president 
 of the Submarine Boat Corporation, representing employers; Mr. 
 Frank J. Hayes, president of the United Mine Workers of America; 
 Mr. William H. Johnston, president of the International Association 
 of Machinists; Mr. T. A. Rickert, president of the Unked Garment 
 Workers of America; Mr. W. L. Hutcheson, president of the United 
 Brotherhood of Carpenters and Joiners of America; and Mr. Victor 
 A. Olander, representative of the International Seamen's Union of 
 America, representing employes. The representatives of the public 
 were ex-President William Howard Taft and Mr. Frank P. Walsh.
 
 86 THE WORKERS AT WAR 
 
 not use coercive measures of any kind to induce persons to 
 join their organizations, nor to induce employers to bargain or 
 deal therewith. 
 
 In establishments where the union shop exists the same shall 
 continue and the union standards as to wages, hours of labor, 
 and other conditions of employment shall be maintained. 
 
 In establishments where union and non-union men and 
 women now work together, and the employer meets only with 
 the employes or representatives engaged in said establishments, 
 the continuance of such condition shall not be deemed a griev- 
 ance. This declaration, however, is not intended in any man- 
 ner to deny the right or discourage the practice of the forma- 
 tion of labor unions, or the joining of the same by the workers 
 in said establishments, as guaranteed in the preceding para- 
 graph, nor to prevent the War Labor Board ' from urging, or 
 any umpire from granting, under the machinery herein pro- 
 vided, improvement of their situation in the matter of wages, 
 hours of labor, or other conditions, as shall be found desirable 
 from time to time. 
 
 Established safeguards and regulations for the protection of 
 the health and safety of workers shall not be relaxed. 
 
 If it shall become necessary to employ women on work or- 
 dinarily performed by men, they must be allowed equal pay 
 for equal work and must not be allotted tasks disproportionate 
 to their strength. 
 
 The basic eight hour day is recognized as applying in all 
 cases in which existing law requires it. In all other cases the 
 question of hours of labor shall be settled with due regard to 
 governmental necessities and the welfare, health, and proper 
 comfort of the workers. 
 
 The maximum production of all war industries should be 
 maintained, and methods of work and operation on the part of 
 employers or workers which operate to delay or limit produc- 
 
 1 The creation of this board was recommended in the report. See 
 Chapter XIII for a discussion of the operation of this board.
 
 WILSON ADMINISTRATION'S LABOR POLICY 87 
 
 tion, or which have a tendency to increase artificially the cost 
 thereof, should be discouraged. 
 
 In fixing wages, hours, and conditions of labor regard should 
 always be had to the labor standards, wage scales, and other 
 conditions prevailing in the localities affected. 
 
 The right of all workers, including common laborers, to a 
 living wage is hereby declared. 
 
 In fixing wages, minimum rates of pay shall be established 
 which will insure the subsistence of the worker and his family 
 in health and reasonable comfort. 
 
 For the purpose of mobilizing the labor supply with a view 
 to its rapid and effective distribution, a permanent list of the 
 number of skilled and other workers available in different parts 
 of the Nation shall be kept on file by the Department of Labor, 
 the information to be constantly furnished by the trade unions, 
 by State employment bureaus and Federal agencies of like 
 character, and by the managers and operators of industrial 
 establishments throughout the country. These agencies should 
 be given opportunity to aid in the distribution of labor, as 
 necessity demands. 
 
 Such is the compass or chart of industrial " rights " for 
 both employer and employe which the Wilson Administration 
 had formulated as a guide for the United States Government as 
 the national employer and for all others engaged on war work 
 for the duration of the conflict with Germany. To the em- 
 ployer and the Government was assured maximum production 
 within proper and reasonable limitations. To the worker was 
 assured the right to organize and a certain degree of protection 
 to his economic welfare. To the public was assured the es- 
 tablishment, even though in a limited degree, of the principles 
 of industrial democracy assured at least for the period of 
 the war that was being fought against autocracy in order '* to 
 make the world safe for democracy."
 
 CHAPTER IX 
 
 THE GOVERNMENT AND THE RAILWAY EMPLOYES 
 
 THESE principles of a code of industrial ethics to govern 
 the relations between employers and employes engaged 
 in essential war production were not conceived out of nothing 
 by the War Labor Conference Board. All of them are well 
 recognized principles of right conduct which the progress of 
 the labor movement has established in not a few of the more 
 important industries. The real difficulty in these industries 
 was the absence of properly organized machinery for the ap- 
 plication of the principles to the concrete cases of individual 
 employes machinery in the conduct and operation of which 
 both employer and employe could have explicit confidence as 
 to its impartiality and disinterested motives. 
 
 This situation is probably exemplified most strikingly in the 
 case of the railroads of the country. They employed about 
 1,700,000 men in pursuits which brought them within the 
 influence of the labor union. The numbers engaged in the prin- 
 cipal occupational groups as classified by the Interstate Com- 
 merce Commission J were as follows : 
 
 Maintenance of way 449,000 
 
 Maintenance of equipment and mechanical 389,000 
 
 Train operation 227,000 
 
 Yard employes 184,000 
 
 Clerks 183,000 
 
 Station employes 133,000 
 
 Dispatchers and telegraphers 67,000 
 
 Much the larger number of these employes were members of 
 some one of the fourteen organizations that were in existence 
 
 1 Statistics of Railways, Interstate Commerce Commission. 
 
 88
 
 GOVERNMENT AND RAILWAY EMPLOYES 89 
 
 among them. All of these, with the exception of the four 
 brotherhoods whose members operated the trains, were affiliated 
 with the American Federation of Labor. In probably no other 
 single industry are the workers more strongly and compactly 
 organized into labor unions or brotherhoods. Consequently 
 they have been able to establish principles governing the con- 
 ditions of their employment and their relations with the em- 
 ployers which are more advantageous to the employes than 
 those that prevail in almost any other industry. Nearly all 
 the railroad corporations " recognized " these unions and dealt 
 with their official representatives through joint bargaining ma- 
 chinery. This had reached such a point of development by 
 1910 that what are known as concerted wage movements were 
 conducted at the same time against all the railroads in each of 
 the three territorial districts by two or more of the brother- 
 hoods whose members operate the trains ; and in 1914 all four 
 unions representing the engineers, firemen, conductors, and 
 trainmen united in a common demand upon all the railroads 
 of the entire country for the eight hour work day. These con- 
 certed movements usually consumed more than twelve months 
 from the time of their inauguration until a decision was 
 reached. This decision was made in every case but that of 
 the eight hour day l movement by a board of arbitration ap- 
 pointed by the President of the United States, the representa- 
 tives of the unions and the railroads always being unable to 
 come to an agreement on the demands of the employes. On 
 these boards representatives of the unions were appointed as 
 members and thus received official recognition. All this in- 
 volved hearings, the establishing of statistical bureaus by both 
 sides to the controversy, the preparation and presentation be- 
 fore the board of evidence bearing on the demands, and in fact 
 the creation of almost all the paraphernalia of courts of law 
 necessary for the ascertainment of the facts and the meting out 
 of justice. 
 
 1 The eight-hour work day in train operation was established by 
 federal law in the enactment in 1914 of the Adamson Act by Congress.
 
 90 THE WORKERS AT WAR 
 
 Notwithstanding this development of industrial machinery 
 the relations between the railways and their employes were far 
 from being satisfactory to the workers, to the officials of the 
 companies, or to the public. The employes complained of low 
 wages, of maladjustments in wages as between individuals in 
 the same occupation and as between occupations, of excessive 
 hours of work in particular occupations, of the absence of 
 proper machinery for deciding fairly the many disputed ques- 
 tions that were constantly agitating their grievance committees, 
 and so on indefinitely. In fact, at the very moment of the 
 entrance of the United States into the war the engineers, fire- 
 men, conductors, and trainmen, as well as other organized rail- 
 way employes, were making demands upon the transportation 
 corporations. The necessities of war required that the direct 
 control and operation of the more important of these transpor- 
 tation lines be taken over by the National Government. This 
 action in December, 1917,* had the effect of making every rail- 
 road employe on these lines virtually an employe of the Gov- 
 ernment. 
 
 Here, too, the Wilson Administration exhibited a high degree 
 of statesmanship in the labor policy which it applied to the 
 situation. It first appointed the disinterested public-spirited 
 commission to which reference has already been made. 2 This 
 
 1 The statement accompanying the Proclamation of President Wil- 
 son taking over the railroads under federal administration said that 
 " it is necessary for the complete mobilization of our resources that 
 the transportation systems of the country should be organized and 
 employed under a single authority and a simplified method of co- 
 ordination which has not proved possible under private management 
 and control." The railroads were taken possession of for the Gov- 
 ernment by the Secretary of War and control was assumed at twelve 
 o'clock noon December 8, 1917. Control and operation of the systems 
 were exercised by the Secretary of the Treasury, appointed and 
 designated as Director General of Railroads, through Regional Di- 
 rectors. 
 
 2 Chapter II, page 19. The members of the commission were Mr. 
 Franklin K. Lane, Secretary of the Interior ; Mr. Charles C. McChord, 
 a member of the Interstate Commerce Commission; Mr. J. Harry Cov-
 
 GOVERNMENT AND RAILWAY EMPLOYES 91 
 
 commission conducted an investigation as directed and reported 
 its findings and conclusions to the Director General of the 
 United States Railroad Administration. It found wages too 
 low in many occupations, as already stated on page 19, and 
 it recommended specified changes in compensation which it 
 believed would be more fair to the employes affected. These 
 increases it estimated would total $300,000,000 a year for all 
 the railroads of the entire country. Whatever the effects upon 
 the mind may be of the magnitude of this amount, says its 
 report, " we regard such an expenditure as necessary for the 
 immediate allaying of a feeling that cannot be wisely fostered 
 by national inaction, and as not one dollar more than justice at 
 this time requires. It will make hard places smoother for 
 many who are now in sore need. It gives no bounty. It is 
 not a bonus. It is no more than an honorable meeting of an 
 obligation." 
 
 The findings of the commission as to increases in wages were 
 made effective, with slight modifications, by the Director Gen- 
 eral under date of May 26, 1918, in General Order No. 27. 
 Some of the monthly increases were as high as 43 per cent, 
 for employes receiving under $46 per month, the percentage 
 gradually decreasing in a constant ratio, leaving no increase to 
 employes whose monthly wages were $250 and more in De- 
 cember, 1915. While this ratio appears uniform, the actual 
 increases in dollars and cents extended from $20 a month to 
 the lowest paid men up to $33.60 for those receiving $82 in 
 December, 1915, gradually dropping to no increase for the 
 higher paid men. Wherever wages or rates of overtime were 
 higher than those fixed by the Director General's Order they 
 remained undisturbed, and no adjustment of hours of work was 
 to be permitted which would serve to deprive any employe of 
 the full amount of the increased compensation to which he 
 was entitled under the award. 
 
 ington, Chief Justice of the Supreme Court of the District of Columbia ; 
 and Mr. William R. Willcox, formerly chairman of the New York 
 Public Service Commission.
 
 92 THE WORKERS AT WAR 
 
 Colored firemen, trainmen, and switchmen, in addition to 
 securing the wage increase recommended by the commission, 
 had their wages advanced on June i, 1918, to the same as that 
 of white men employed on the same roads in the same kind 
 of work. 
 
 On the question of establishing the eight hour work day 
 for those employes not so benefited by the Adamson Act, the 
 Director General did not follow the adverse recommendation 
 of the Wage Commission. Instead, in the rules governing con- 
 ditions of employment which he promulgated, the eight 
 hour day was established as the basis upon which all further 
 wage adjustments were to be made without, however, reduc- 
 ing the hours of employment or increasing at that time the 
 total compensation fixed for the number of hours worked in 
 excess of eight. 
 
 Within the Railroad Administration there was created a 
 Division of Labor with a director at its head who had super- 
 vision over all labor matters as advisor to the Director Gen- 
 eral. Mr. W. S. Carter, president of the Brotherhood of Lo- 
 comotive Enginemen and Firemen, was appointed director. 
 " One of the principal purposes of the creation of the Division 
 of Labor," he says, in his first annual report, 1 " was to provide 
 means whereby the controversies that constantly arise between 
 railroad officials and employes would be promptly and equitably 
 adjusted. An inability to adjust these controversies under past 
 practices resulted in strikes, threatened strikes, or a constant 
 unrest among employes to the extent that the efficiency of the 
 service had greatly diminished at the time that the roads were 
 taken over under Federal control." 
 
 The labor situation on the railroads prior to their being 
 taken over by the Government Mr. Carter summarizes as fol- 
 lows: 
 
 " During the two or three years antedating Federal control 
 of the railroads an alarming situation was created in that the 
 
 1 Annual Report Director General of Railroads, Division of Labor, 
 1918.
 
 GOVERNMENT AND RAILWAY EMPLOYES 93 
 
 employes' organizations as a whole and through federations, 
 found themselves confronted with similar federations on the 
 part of the railroads, the roads being represented by confer- 
 ence committees and the conference committees being subordi- 
 nate to ' advisory committees.' It was alleged by employes 
 that these conference committees of all of the principal rail- 
 roads in a district were not permitted to grant the demands 
 of employes or even to make favorable compromises with- 
 out the consent of the advisory committee. The advisory 
 committee, it is alleged, was the agent of the great banking 
 institutions that controlled the financial policy of all the 
 railroads. 
 
 " Arbitrations have been resorted to in the later years in 
 these district movements, with the result that employes reached 
 the conclusion that an arbitration award depended entirely 
 upon the frame of mind of the neutral arbitrator. Persons 
 selected to perform this function were liberal in their awards in 
 accordance with the liberality of their minds when appointed 
 upon such arbitration boards. 
 
 " There seems to have been a public opinion that any man, 
 even indirectly connected with labor, would be unqualified to act 
 as a neutral arbitrator, with the result that most estimable 
 gentlemen who had never had any connection with, and who 
 had little knowledge of, labor conditions were called upon to 
 act as umpires in these great contests. It was alleged by the 
 employes that usually these arbitrators, having no technical 
 knowledge of wage schedules, often made awards that were 
 difficult of interpretation, if they did not, in fact, bring about 
 conditions the very opposite to that intended by the neutral 
 arbitrator. It also became apparent that in the application of 
 the arbitration award, the officials of a railroad were the sole 
 administrators thereof, with the result that after employes had 
 been led to believe that an arbitration award brought them 
 much relief, it was applied in a manner that ' took away from 
 them more than had been given them.' 
 
 " Later, provisions were made for submitting controversies 
 over the application of an arbitration award back to the arbitra- 
 tion board, or to some other umpire, but this resulted in the 
 continuation of controversies over a period of two or three 
 years. 
 
 " It may be truthfully said that at the time the railroads 
 passed under Federal control, because of these vexatious con- 
 tentions, the morale of railway employes had sunk to a low
 
 94 THE WORKERS AT WAR 
 
 degree. In many instances there was an entire absence of 
 esprit de corps, so necessary for efficient operation. 
 
 " It was with the knowledge of this alarming situation, and 
 with a determination to restore harmonious relations between 
 employes and the railroads, and thereby increase the efficiency 
 of the railroads, that the Division of Labor of the Railroad 
 Administration was created." 
 
 Within the Division of Labor was established the Board of 
 Railway Wages and Working Conditions consisting of three 
 representatives of the employes and an equal number of repre- 
 sentatives of the railroad corporations. The duties of this 
 board were to hear and investigate matters presented by rail- 
 way employes or their representatives affecting such matters 
 as: i. Inequalities as to wages and working conditions, 
 whether as to individual employes or classes of employes. 
 2. Conditions arising from competition with employes in other 
 industries. 3. Rules and working conditions for the several 
 classes of employes, either for the country as a whole or for 
 different parts of the country. The board was also to hear 
 and investigate other matters affecting wages and working 
 conditions referred to it by the Director General ; it was solely 
 advisory, however, and was to submit its recommendations to 
 the Director General for his determination. 
 
 With the view of promptly and equitably adjusting " any 
 controversies which may arise, thereby eliminating misunder- 
 standings which tend to lessen the efficiency of the service " 
 three boards were created. Railway Board of Adjustment 
 No. i consisted of eight members, four selected by the regional 
 directors of the eastern, southern, and western territorial 
 grouping of the roads and four by the chief executive officers 
 of the Brotherhood of Locomotive Engineers, Order of Rail- 
 way Conductors, Brotherhood of Railroad Trainmen, and 
 Brotherhood of Locomotive Firemen and Enginemen. 
 
 Similarly Board No. 2 was to adjust controversies between 
 the railroads and such of their employes as were engaged as 
 machinists, boiler makers, blacksmiths, iron workers, carmen, 
 sheet metal workers, electricians, and helpers and who also were
 
 GOVERNMENT AND RAILWAY EMPLOYES 95 
 
 members of the various unions with which the roads had en- 
 tered into agreement as to basis of compensation and regula- 
 tions of employment. This board consisted of twelve mem- 
 bers, half of them selected by the six organizations of employes 
 mentioned in the " memorandum of understanding " and the 
 other six by the regional directors of the Railroad Administra- 
 tion. Board No. 3, consisting of eight members selected on 
 the same principle as that of the other two boards, was to per- 
 form a like function with regard to telegraphers, switchmen, 
 clerks, and maintenance of way employes. 
 
 These boards were to apply, each within its jurisdiction, the 
 agreements as to basis of compensation and regulations of 
 employment which had been entered into between the various 
 organizations of employes and the railway companies. They 
 had no jurisdiction over the recommendation, issuance, or in- 
 terpretation of wage orders, but all controversies growing out 
 of the application of the provisions of the agreements or wage 
 schedules, and all other disputes which were not promptly 
 adjusted by the officials and the employes on any of the roads 
 operated by the Government, were referred to the board having 
 jurisdiction. Separate meetings of each board were held regu- 
 larly at stated times each month in the city of Washington. 
 All decisions were made and approved by the entire member- 
 ship of the board, the presiding officer being required to vote 
 upon all decisions. Each board selected its own chairman. 
 
 The method of procedure for the settlement of controversies 
 was identical before all three boards. Personal grievances or 
 controversies arising under interpretation of wage agreements, 
 and all other disputes arising between officials of a railroad and 
 its employes covered by the " memorandum of understand- 
 ing," were handled in the usual manner which had become 
 customary under private operation, that is, by general com- 
 mittees of the employes up to and including the chief operating 
 officer of the railroad (or some one officially designated by 
 him). If an agreement was not reached, the chairman of the 
 general committee of employes was to refer the matter to the
 
 96 THE WORKERS AT WAR 
 
 chief executive of the organization concerned ; if the conten- 
 tion of the employes' committee was approved by such ex- 
 ecutive officer, then the chief operating officer of the railroad 
 and the chief executive officer of the organization concerned 
 referred the matter, with all supporting papers, to the Di- 
 rector of the Division of Labor of the Railroad Administra- 
 tion who, in turn, presented the case to the board of adjust- 
 ment having jurisdiction. This board promptly heard and de- 
 cided the case, giving due notice of the time set for hearing to 
 the chief operating officer of the railroad and the chief ex- 
 ecutive officer of the organization. No question was consid- 
 ered by the board unless officially referred to it in this manner. 
 
 In hearings before the board of matters properly submitted 
 for its consideration, the railroad was represented by such per- 
 son or persons as the chief operating officer designated, and the 
 employes by such representative as the chief executive officer 
 of the organization concerned designated. In each controversy 
 before the board there was usually presented a joint concrete 
 statement of facts. The board had full authority, however, 
 to require information in addition to the concrete statement of 
 facts, and could call upon the chief operating officer of the 
 railroad or the chief executive officer of the organization con- 
 cerned for additional evidence, either oral or written. 
 
 Employes not members of the organizations having agree- 
 ments with the railroads were not, because of this fact, denied 
 the advantages of these boards of adjustment. For such em- 
 ployes special provision was made by the Division of Labor 
 for settling their controversies. Jurisdiction in such cases over 
 express company employes was also vested in the Division of 
 Labor. Within the Division a Women's Service Section was 
 created for the special consideration of the welfare of the one 
 hundred thousand 1 females employed by the railroads. 
 
 1 The number of women employes of the railroads in January, 1917, 
 was 31,400; in January, 1918, 61,162; October, 1918, 101,785; and Oc- 
 tober, 1919, 81,803 Report of Women's Service Section, Division of 
 Labor, United States Railroad Administration, December 31, 1919.
 
 GOVERNMENT AND RAILWAY EMPLOYES 97 
 
 The importance of all this does not lie in an account of the 
 details of the operation of this machinery but rather in the 
 fact that such machinery was established. To provide a court 
 or tribunal to which industrial matters in dispute can be taken 
 by the aggrieved employe in the knowledge and belief that fair- 
 ness and impartiality will be practiced with the view to ad- 
 ministering justice as between employer and employe is an 
 act that, in itself, goes a long way in solving the so-called labor 
 problem. As many as 2,658 separate and distinct cases of 
 grievance or complaint were handled by the three boards of 
 adjustment alone in the less than twelve month period from 
 January i to December 15, 1919. This number does not in- 
 clude the cases of employes unrepresented on the boards, nor 
 those submitted to the Board of Wages and Working Condi- 
 tions. Such matters concerned rate of pay, claims for over- 
 time, back pay, and for time lost ; bonus, minimum wage, travel, 
 time compensation, meals and lodging as extra pay, deductions 
 from wages, vacations with pay, time and one-half pay for 
 holidays, methods of computing back pay, equal pay to women, 
 wage differentials, adjustment of wages, piece work, occupa- 
 tional classification, occupational qualification, time for meals, 
 assignment of work, duties of helpers, discrimination, seniority 
 rights, promotion, demotion, suspension, dismissal, reinstate- 
 ment, refusal to punch time card, advance notice of resigna- 
 tion, and so on. These and a hundred and one other personal 
 interest matters of no general concern but which are of vital 
 importance to the particular individual go to make up the 
 grievances and complaints which unattended to result in the 
 present-day labor problem. They affect industrial rights that 
 are comparable in a way to those controversies in civil life 
 between individuals that have necessitated the establishing of 
 courts of law for their just settlement. 
 
 This first experiment on a large scale of the operation of 
 industrial courts or tribunals, under the direct supervision of 
 the National Government, for the just settlement of disputes 
 affecting individuals as distinct from classes or groups of cm-
 
 98 THE WORKERS AT WAR 
 
 ployes, contains the germ of large promise for the successful 
 working out of our coming industrial democracy. It is true 
 the Government had previously been called upon at various 
 times to intervene in labor controversies in the industrial state 
 through the processes of mediation, conciliation, and arbitra- 
 tion, such as in the appointment of the Anthracite Strike Com- 
 mission in 1902 by President Roosevelt ; in the creation of the 
 four arbitration boards at different times between 1912 and 
 1914 for the settlement of the concerted wage movements of 
 the railway brotherhoods ; through the Bureau of Mediation 
 and Conciliation of the Department of Labor ; and in the opera- 
 tion of the United States Board of Mediation and Concili- 
 ation, the latter created under the Newlands act in 1913 and 
 confined to the railroads. But the operation of these commis- 
 sions or boards involved the settlement of questions of broad 
 principles as affecting groups or classes of workers and were 
 not tribunals for the adjustment of what might be called per- 
 sonal cases involving the question of right and wrong to the 
 individual. 
 
 This latter was the function performed by the railway 
 adjustment boards. With the basis of wages and the principles 
 of employment determined in the agreement, it was of equal 
 importance to the successful carrying out of the terms of the 
 agreement that some instrumentality be created that would as- 
 sure to the worker a fair interpretation of what the basis and 
 principles were intended to mean as well as an impartial ap- 
 plication of that meaning to the varying facts of individual 
 employment. This is vital to orderly industrial progress and 
 to the elimination of causes for misunderstandings resulting 
 in lockouts and strikes if we as a people are to approach to 
 any degree of democracy in industry, for the simple reason that 
 it is in the application of general principles to concrete cases 
 that the worker knows he is or is not being treated fairly. 
 And the assurance of fair and just treatment is of the essence 
 of social contentment it is the antidote to discontent, unrest, 
 and revolution.
 
 CHAPTER X 
 
 THE GOVERNMENT AND SHIPBUILDING LABOR 
 
 I ^HE inestimable value to the American people in their 
 * prosecution of the war resulting from the recognition of 
 the labor union by the Wilson Administration as one of the car- 
 dinal principles of the Government's labor policy is probably il- 
 lustrated most strikingly in the shipbuilding industry. This 
 policy immediately brought to the construction of yards and of 
 ships the support of organized labor without which there could 
 not have been even the slightest hope of meeting the unprec- 
 edented situation confronting this industry a situation de- 
 manding the quickest possible expansion. 
 
 The shipbuilding program of the Emergency Fleet Corpora- 
 tion in July, 1917, which later was considerably enlarged, pro- 
 posed the construction of 425 ships with an aggregate tonnage 
 of 1,860,000 tons at a cost of $275,000,000, excluding one hun- 
 dred wood ships the contracts for which were still being ne- 
 gotiated at the time. This program did not include contracts 
 already let for the construction of new ships and yards at a 
 cost of $550,000,000, nor the ships already under construction 
 that were commandeered by the Government. The 425 ship? 
 comprised 348 wood and 77 steel. 
 
 In 1916, according to statistics of the Bureau of the Census, 
 there were a total of only 44,962 employes in the sixty-three 
 shipyards 43,582 in the forty-five steel shipyards and 1,380 
 in the eighteen wood shipyards. In February, 1918, figures 
 compiled by the Emergency Fleet Corporation show a total of 
 192,839 employes in 112 shipyards 162,880 in fifty-three 
 steel shipyards and 29,959 in fifty-nine wood shipyards. Here 
 was a gain in the number of shipyard workers of nearly 150,000 
 
 99
 
 ioo THE WORKERS AT WAR 
 
 in less than two years. In addition to these 112 yards there 
 were twenty-four nearing completion. This gives an increase 
 of seventy-five in the number of shipyards. These yards were 
 scattered at all practicable locations along the American coast 
 line of the Great Lakes, the Atlantic and Pacific Oceans, and 
 the Gulf of Mexico. 
 
 This great expansion in the capacity of the old yards and 
 in the number of new yards completed and under construction 
 gave an unprecedented demand for workers in all the mechan- 
 ical trades. The extent of this demand is only partly indi- 
 cated in the statement that at the beginning of 1918 there was 
 an immediate need for the enrollment of 250,000 skilled work- 
 men as shipyard volunteers. Within sixty days from that date 
 three of the government shipyards were to be completed and 
 soon thereafter these would require more than 60,000 work- 
 men to supply the three eight-hour shifts with which the yards 
 were to be operated. At that time the Shipping Board con- 
 trolled 716 shipways of which 302 were for wood and 414 for 
 steel ships. The yards were working only one eight-hour shift 
 a day and for only six days a week. Within a few months all 
 the shipyards would have need for 386,000 mechanics. 
 
 Before this time arrived, however, the general labor policy 
 of the Government had been formulated and was made to 
 apply to all the shipyards of the country, privately owned as 
 well as government owned. This policy was embodied in an 
 agreement entered into in August, 1917, between officials of 
 the Navy Department and the Emergency Fleet Corporation, 
 representing the Government, representatives of shipyard em- 
 ployers, and representatives of the international unions whose 
 members were engaged in the various crafts in the yards. 
 These various organizations whose presidents signed the agree- 
 ment are indicative of the many different kinds of workmen 
 involved. They included the International Association of Ma- 
 chinists, the International Molders, the United Brotherhood of 
 Carpenters and Joiners, and the score and more organizations 
 representing the building trades, the metal trades, the plumbers
 
 GOVERNMENT AND SHIPBUILDING LABOR 101 
 
 and steamfitters, the steam and operating engineers,- the boiler- 
 makers and iron shipbuilders, the pattern makers, the black- 
 smiths and helpers, and so on. 
 
 The United States Shipping Board had been created by the 
 Government as its instrument for operating all ships, excepting 
 of course the war vessels of the Navy Department, and the 
 Emergency Fleet Corporation had been organized by the Ship- 
 ping Board for the construction of all ships other than those 
 being built for the Navy. Thus in all shipyards, those priv- 
 ately owned as well as those constructed by the Government, 
 the Fleet Corporation and the Navy Department exercised con- 
 trol over the construction of all vessels. This had virtually 
 the same effect of making all shipyard workers employes of 
 the Government as had the taking over of the railroads in its 
 effect on railway employes. 
 
 The agreement referred to as having been entered into by 
 representatives of the Government, of employers, and of em- 
 ployes established the Shipbuilding Labor Adjustment Board. 
 Its jurisdiction extended over wages, hours of work, and other 
 conditions of employment in shipyards, and its operation af- 
 fected all workers engaged in the construction of the emer- 
 gency fleets of the Government. It is indicative, as we have 
 seen were also the railway wage adjustment boards, of the in- 
 strumentalities of peace time which the Government accepted 
 and adapted to war conditions. Through it the Government 
 adopted the standards as to wages and working conditions and 
 the methods of settling industrial disputes which the labor 
 movement had built up through years of struggle and or- 
 ganized effort against the determined opposition of the em- 
 ployer class. 
 
 The particular machinery which this agreement created for 
 the adjustment of disputes and which was to be applied to 
 those arising out of the construction and repair of shipbuild- 
 ing plants as well as of ships, took the form of a board com- 
 posed of three members appointed by the United States Ship- 
 ping Board Emergency Fleet Corporation, one representing the 
 
 UNIVERSITY OF SOUTHERN CALIFORNIA LIBRARY
 
 102 THE WORKERS AT WAR 
 
 corporation and selected by it, one representing the public and 
 nominated by the President of the United States, and one rep- 
 resenting labor named by Mr. Samuel Gompers. 1 In order to 
 meet the situation resulting from the existence in the industry 
 of two distinct craft groups, provision was made for the nomi- 
 nation by Mr. Gompers of two persons, one from the metal 
 trades to sit on the board when the matter under consideration 
 concerned the construction of shipyards or steel ships and the 
 other from among the trades primarily concerned who was to 
 sit when the matter under consideration had reference to 
 wooden hulls. When the issues before the board concerned 
 wages, hours, or conditions applying to the production of both 
 kinds of ships, only one of the two nominees representing 
 labor was to sit, this to be determined between them or, in the 
 event of their disagreement, by Mr. Gompers. The agreement 
 ran : 
 
 " When matters concerning any plant or plants are before the 
 board, it shall invite a person representing and designated by 
 the owner or owners of such plant or plants, and also a person 
 representing, or selected by, the majority of the workers in the 
 particular craft or crafts directly interested in the disputed 
 matters, both of said representatives to sit with voting power 
 as associate members of said board in connection with such 
 matters. If a question coming under the jurisdiction of the 
 board arises with reference to such construction in a private 
 plant, in which construction is also being carried on for the 
 Navy Department, the Secretary of the Navy or such person 
 as he may designate shall sit with voting power as a member of 
 the board. In the event of a tie vote, when the board is so 
 constituted, the decision shall be referred to the chairman of the 
 Council of National Defense, or to such person as he may 
 designate. This memorandum shall in no way serve as a prec- 
 edent for procedure in Government plants under the War or 
 Navy Departments. 
 
 " The plants where such construction is being carried on shall 
 be geographically districted by the board. In each district, the 
 contractors in whose plants such construction is being carried 
 
 1 President of the American Federation of Labor with which the 
 separate unions were affiliated.
 
 GOVERNMENT AND SHIPBUILDING LABOR 103 
 
 on, and the representatives of such international labor organiza- 
 tions as have members engaged in such production or construc- 
 tion in such plants, and as are selected for the purpose by the 
 labor member of the board, shall be called upon, under condi- 
 tions to be laid down by it, to agree upon a person or persons 
 who shall act under the direction of the board as examiner or 
 examiners in such district. If the board does not succeed in 
 having an examiner so selected, then the board shall by unani- 
 mous action select a person or persons for such position. The 
 examiner shall be subject to removal by the board at any time 
 by unanimous vote." 
 
 Provision was made in the agreement for the prompt report- 
 ing to the board of any dispute with reference to wages, hours, 
 or conditions of labor which could not be adjusted satisfac- 
 torily to the principals concerned. But before such report was 
 made the district officer of the Emergency Fleet Corporation 
 was to confer with the local representatives of the crafts in- 
 volved, *' or with such authorized heads of any local labor or- 
 ganizations interested therein as may be designated by the 
 labor member of the board, or on their request with the nat- 
 ional head or heads of such organization or organizations or 
 his or their duly authorized representative or representatives." 
 If by this method the dispute could not be adjusted then the 
 board was to send an examiner to such plant to bring about a 
 mutually satisfactory adjustment. If this also failed the ex- 
 aminer, in his report to the board, was to recommend terms of 
 adjustment, and the board was then to decide the questions 
 at issue. 
 
 The scales of wages, hours, and other conditions of employ- 
 ment in effect July 15, 1917, in each shipyard where ship or 
 plant construction was being carried on, were taken by the 
 board as the basic standards. After these were established 
 then consideration was to be given by the board to any cir- 
 cumstances which seemed to it to call for changes in wages, 
 hours, or conditions. The board was to keep itself fully in 1 
 formed as to the relation between living costs in the several 
 districts and their comparison between progressive periods of
 
 104 
 
 ) 
 
 time. Retroactive decisions of the board were to be made un- 
 der proper conditions, in which cases accounting was to be 
 made in accordance with the directions of the board. While 
 all its decisions were to be final and binding on all parties, in 
 so far as the agreement was capable of achieving such result, 
 it was provided that " at any time after six months have 
 elapsed following any such ratified agreement or any such final 
 decision by the board of any question as to wages, hours, or 
 conditions in any plant, such question may be reopened for 
 adjustment upon the request of the majority of the craft 
 or crafts at such- plant affected by such agreement or de- 
 cision." 
 
 It cannot be expected that within the limits of a single 
 chapter an adequate account can be given of the work of the 
 Shipbuilding Labor Adjustment Board. Such an account will 
 not be attempted here. It is desired merely to point out some 
 of the broad economic principles upon which the operation of 
 the board was based and to indicate the nature of the indus- 
 trial problems confronting employers and employes and which 
 are the causes of labor disputes. 
 
 In one of its earliest decisions the board stated that it had 
 been convinced by the unanimous testimony of both employers 
 and employes that a uniform minimum wage scale and uniform 
 piece rates for all the shipyards on the Delaware River, from 
 Bristol on the north to Wilmington on the south, would be de- 
 sirable. The most serious obstacle to the maintenance of a 
 uniform minimum wage scale in all the yards of the Delaware 
 River district was found by the board to be the variable ex- 
 pense for transportation to and from work of the employes of 
 the yards up and down the river from Philadelphia owing 
 largely to inadequate local housing facilities. To equalize this 
 condition the board authorized shipyards, whose employes were 
 compelled to spend regularly more than eight cents a day each 
 way for transportation to and from work, to provide these 
 employes with tickets at the expense of the shipbuilding com- 
 pany. The object of this was partly to enable yards in the
 
 GOVERNMENT AND SHIPBUILDING LABOR 105 
 
 vicinity of which there were inadequate housing facilities to 
 draw workmen from greater distances. 
 
 In operation in the different yards were numerous bonus, 
 premium, and contract systems of wage payment in addition 
 to the day and the piece wage systems. With the object of in- 
 troducing a greater degree of uniformity the board prescribed 
 the minimum wage and the piece rate scales and directed that 
 no bonus or premium in addition was to be paid in specified oc- 
 cupations except with its express permission. In some depart- 
 ments, such as riveting and chipping and calking, a preference 
 existed, not only among employers but also among the workers 
 themselves, for the piece wage system. The rates made ef- 
 fective by the board were the result of conferences between 
 representatives of the yard owners and of the crafts concerned 
 in which both sides made concessions. In consequence the 
 first application of these rates was of limited scope but the in- 
 tention was to extend the list from time to time so as to include 
 operations and types of vessels, such as torpedo-boat destroy- 
 ers and cylindrical oil tankers, for which fair rates could not 
 then be ascertained. 
 
 Previous attempts on the part of shipyard owners to es- 
 tablish piece rates had not been successful, it having been the 
 experience of the workers that the piece rate was invariably 
 lowered as soon as they indicated their ability to increase their 
 earnings beyond that which the employer considered a normal 
 wage. As a result there had grown up in many of the yards 
 rules or understandings among the workers which limited the 
 amount any one worker was to produce in a day. To combat 
 this possibility developing out of the new piece rates the board 
 established, appeal was made to the patriotism of the workers. 
 
 " In the present national emergency," the board said, " it is 
 vitally important that ev v ery limitation upon output be removed. 
 Every shipyard worker must appreciate that he is fighting for 
 his country when he drives a rivet or calks a seam just as 
 effectively as the soldier in the trenches when he wields his 
 bayonet or fires a gun. And as the soldier is paid directly by
 
 106 THE WORKERS AT WAR 
 
 the Government so the shipyard worker must realize that he 
 now receives his compensation from the Government, all ship- 
 building now being upon Government account." To bring 
 home to piece workers that the Government was behind them 
 and that they must stand behind the Government, the board 
 directed that notices be posted conspicuously in every depart- 
 ment of every shipyard where piece work was carried on stat- 
 ing in effect that the piece rates prescribed as part of its award 
 were under no circumstances to be lowered during the duration 
 of the war. " In the name of the people of the United States," 
 the notice read, " we urge employes in shipyards to do their 
 utmost toward winning the war by removing all limitations 
 upon output and hastening in every possible way, each accord- 
 ing to his capacity, the production of ships." 
 
 As to hours of employment the board found that " a good 
 deal of diversity and confusion in the different yards exists," 
 owing to the fact that the eight-hour day had not been uni- 
 versally introduced, while the half holiday on Saturday had 
 been firmly established by the workers and was tenaciously 
 adhered to by them. Under the federal eight-hour law work 
 in excess of eight hours in any calendar day for any depart- 
 ment of the Government counted as overtime and was to be 
 compensated for at the time-and-one-half or double time rate. 
 In view of the effects of these limitations imposed by federal 
 law and local custom the board deemed it necessary to pre- 
 scribe the following rules to govern hours of employment in 
 the shipyards: 
 
 Eight hours shall constitute a day's work from Monday 
 until Friday, inclusive, and four hours on Saturday. 
 
 Work in excess of these periods on any week day shall be 
 calculated as overtime and paid for at the rate of time and one- 
 half. 
 
 Work in excess of sixty hours a week for any employe shall 
 not be permitted, excepting in dry docks, or when ordered by 
 the Navy Department or the Emergency Fleet Corporation, or 
 to protect life or property from imminent danger. 
 
 Work on Sundays and the following holidays shall be paid
 
 GOVERNMENT AND SHIPBUILDING LABOR 107 
 
 for at the rate of double time : New Year's Day, Washington's 
 Birthday, Decoration Day, Fourth of July, Labor Day, Thanks- 
 giving Day, and Christmas Day. 
 
 Men employed on night shift shall receive compensation five 
 per cent, higher than is paid to those employed on day shift. 
 
 " Our purpose in limiting the work of employes under ordi- 
 nary circumstances to sixty hours a week," says the report of 
 the board, " is to discourage the practice of excessive over- 
 time, which we believe leads to inefficiency and lessened rather 
 than enlarged production, and to encourage the introduction of 
 the two and three shift systems. The feasibility of working 
 two or three eight-hour shifts in shipbuilding plants has been 
 conclusively demonstrated, and we urge the shipyards of the 
 Delaware River district to take immediate steps looking toward 
 the introduction of additional shifts in their yards." 
 
 Uniformity in wages, hours, and other conditions in the 
 shipyards of the north Atlantic coast and Hudson River dis- 
 trict were also prescribed by the board, 1 partly with the object 
 of preventing the shifting of men from yard to yard so as to 
 secure greater concentration on shipbuilding in all yards. At 
 the same time it handed down a modified decision establish- 
 ing the same wage rates for skilled mechanics in the south 
 Atlantic and Gulf shipyards. 
 
 With regard to working conditions in shipyards on the Great 
 Lakes, the board found there also a shifting of employes from 
 yard to yard which most seriously retarded the progress of 
 ship construction. It applied the same remedy it had found 
 efficacious in other competitive districts uniformity of con- 
 ditions of employment over the entire area. With easily acces- 
 sible means of transportation from point to point on the Lakes 
 and from the Lakes to the seaboard, the Great Lakes' region 
 virtually constituted a part of the same competitive area as the 
 
 1 Decision of April, 1918. The wage rates fixed were made retro- 
 active for the region about New York harbor, including Bridgeport, 
 Conn., to March n; for the steel yards north of Bridgeport, to March 
 30; and for the other yards, to April i.
 
 io8 THE WORKERS AT WAR 
 
 north Atlantic coast yards. Movements of employes front the 
 shipyards of the Lake region to those of the Atlantic coast 
 in response to higher wages proved this. It was also demon- 
 strated in the substantial uniformity in the wage rates in the 
 yards of Buffalo, Cleveland, Detroit, and Chicago with those 
 of Philadelphia and Baltimore. This led the board to estab- 
 lish wage scales, hours of work, and other conditions for the 
 shipyards of the Great Lakes similar to those for the yards 
 on the north Atlantic coast. This advanced substantially 
 the wages paid to nearly all crafts in the Great Lakes' 
 yards. 1 
 
 Shipyard owners were directed by the board to cooperate 
 with employes in making effective the following rules in refer- 
 ence to machinery for the settlement of industrial disputes : 
 
 The employes of each craft or calling in a shop or yard shall 
 have the right to select three of their number to represent them 
 as members of a shop committee. Each member of this com- 
 mittee shall be chosen by majority vote through secret ballot 
 in such manner as the employes may direct. The chairman of 
 such shop committee shall be a member of a joint shop com- 
 mittee. 
 
 When a grievance arises it shall be taken up by the craft or 
 laborers' committee with the foreman or general foreman. In 
 the event the grievance has not been adjusted, it shall then be 
 taken up by the joint shop committee, first with the superin- 
 tendent, and then, failing a settlement, with the higher officials 
 of the company. If the matter cannot be adjusted between 
 the joint shop committee and these officials, the joint shop com- 
 mittee shall have the right to call into conference a representa- 
 tive chosen by the committee. In case such conference fails 
 to result in a satisfactory adjustment, the grievance shall be 
 submitted to the examiner to be appointed by the Shipbuilding 
 Labor Adjustment Board. 
 
 Any committeeman who shall be found to have been dis- 
 charged without just or sufficient cause, after due investigation 
 shall be reinstated with full pay for all time lost. 
 
 1 To make certain that the wages of no individual employe were 
 reduced in consequence of its award, the board inserted a provision 
 to this effect.
 
 GOVERNMENT AND SHIPBUILDING LABOR 109 
 
 Other regulations of employment prescribed by the board for 
 the guidance of both employers and employes were as follows : 
 
 Believing that in this national emergency past differences 
 between employers and employes must be forgotten in the com- 
 mon determination to produce the maximum possible number 
 of ships, the board will not tolerate any discrimination either 
 on the part of employers or employes between union and non- 
 union men. 
 
 Employes shall be paid at least once a week on the company's 
 time and in no case shall more than five days' pay be held back. 
 
 Any employe laid off or discharged shall within twenty- four 
 hours receive all wages due him. 
 
 No employe shall be required by the employing shipyard to 
 pay any assessment for insurance, medical attendance, or other 
 benefits. 
 
 Competent medical first aid shall be provided for employes 
 requiring such aid and paid for by the employer. 
 
 Shipyard owners are directed to provide for their employes 
 adequate and sanitary toilets, washing facilities, and pure drink- 
 ing water, properly cooled during the summer months. 
 
 The quick and uninterrupted loading and unloading of ves- 
 sels being among the prime essentials of war service overseas, 
 it was also necessary for the Government to provide machinery 
 for minimizing the possibility of labor disturbances between 
 the longshoremen and their employers interfering with this 
 service, coastwise as well as deep sea. Such machinery was 
 established in August, 1917, by the creation of the National 
 Adjustment Commission for the control of wages, hours of 
 work, and conditions of employment at the various ports. 
 This commission was composed of representatives of the 
 United States Shipping Board, the War Department, the ves- 
 sel operators, the International Longshoremen's Association, 
 and the Committee on Shipping of the Council of National 
 Defense. In each port it established a local adjustment com- 
 mission consisting of representatives of the Shipping Board 
 and the War Department, the Longshoremen's Association, and 
 the Operating companies. Disputes not settled locally were re- 
 ferred to the National Commission. The decision of the latter
 
 no THE WORKERS AT WAR 
 
 was binding on all parties. In all cases work was to continue 
 without interruption until an adjustment had been reached. 
 The union rate of wages, hours of work, and other conditions 
 of employment then in effect were adopted as the standards. 
 
 An agreement was also entered into between representatives 
 of the Government, of ship owners and operators, and of em- 
 ployes covering wages and working conditions of men em- 
 ployed in manning in ports and on the high seas the emergency 
 fleets under control of the Government. Provision was made 
 for a standard monthly wage for all employes in the deck and 
 engine departments, for overtime, for meal money on shore, 
 for reimbursement in the loss of personal effects of seamen by 
 the sinking of a vessel, for a bonus to crews entering the war 
 zone, for the training of new men to meet the need of the in- 
 creasing number of ships, and for representatives of the sea- 
 men's union to gain access to docks and the decks of ships. 
 
 Such are some of the concrete, practical every-day questions 
 that go to make up the labor problem in the building and 
 operation of ships and which must be determined by some fair 
 and impartial tribunal, guided solely by a sense of justice and 
 the right concepts of the true meaning of industrial democ- 
 racy, if society is to be saved from the injury that accompanies 
 and flows out of strikes and lockouts. The record of the task 
 accomplished in this direction during the war by the various 
 labor adjustment boards which the Government established in 
 the shipping industry should be of invaluable assistance to both 
 employers and employes in pointing the way out of their dif- 
 ficulties and towards a more human relation in the conduct of 
 industrial production.
 
 CHAPTER XI 
 
 THE GOVERNMENT AND COAL MINE WORKERS 
 
 NEITHER the Government controlled ships nor the Gov- 
 ernment controlled trains essential to the transportation 
 of troops and munitions could have been built and operated 
 without skilled workers. Nor could they have been operated 
 without coal, and this coal could not have been secured without 
 skilled workers in the mines. Coal mining, many contend, is 
 our basal industry; that upon coal all the other industries de- 
 pend for their operation ; that without this fuel the war could 
 never have been won. However this may be, we are not here 
 concerned with probabilities but with the actual conditions in 
 the coal mining industry which confronted the United States 
 Government and with the labor policy it applied to these condi- 
 tions to secure uninterrupted production of this very essen- 
 tial fuel. 
 
 When it is realized that as many as 757,000 men were em- 
 ployed in and about the mines the year the United States en- 
 tered the war and that they produced more than 651,000,000 net 
 tons having a value of $1,533,000,000, we are able to secure 
 some idea of the magnitude and importance of this great in- 
 dustry. This number of men exceeds by 257,000 the total 
 number making up the first increment of men taken by the 
 first draft to comprise the new National Army under the Se- 
 lective Service Act. Their wide distribution in the more im- 
 portant of the twenty-three States of the coal-producing area 
 was as follows :
 
 ii2 THE WORKERS AT WAR 
 
 Coal-Producing Number of 
 
 State 'Employes 
 
 Pennsylvania 328,000 x 
 
 West Virginia , 88,000 
 
 Illinois 84,000 
 
 Ohio 45>5 
 
 Kentucky 35,ooo 
 
 Alabama 28,000 
 
 Indiana 26,500 
 
 Iowa 14,000 
 
 Colorado 14,000 
 
 Virginia 1 1 ,000 
 
 Kansas 10,500 
 
 Tennessee ^ 10,500 
 
 The remaining eleven coal-producing States in the order of 
 their importance as to the number of mine workers employed 
 are Missouri, Oklahoma, Wyoming, Maryland, Washing- 
 ton, Texas, Montana, New Mexico, Arkansas, Utah, and 
 Michigan. 
 
 By far the larger number of these mine workers are or- 
 ganized in the United Mine Workers of America, one of the 
 strongest and most powerful labor unions in the world. Its 
 particular strength as an organization is in the Central Com- 
 petitive Territory, comprising western Pennsylvania, Ohio, In- 
 diana, and Illinois ; and since 1902 in the anthracite fields of 
 northeastern Pennsylvania. For a period of more than a 
 quarter of a century the members of this organization had been 
 working under joint bargaining agreements with the coal op- 
 erators in these and other States and this movement jiad slowly 
 developed into that which is today one of the strongest pieces 
 of collective bargaining machinery in the entire country. This 
 does not mean, of course, that wages, hours of work, and con- 
 ditions of employment in the coal industry were ideal, or even 
 satisfactory, but it does mean that for the employe these had 
 been greatly improved throughout the period and also that 
 they were much more to his advantage than they probably 
 
 1 154,000 in the anthracite and 174,000 in the bituminous coal mines.
 
 would have been in the absence of such machinery. In the 
 anthracite region of Pennsylvania there had also been in op- 
 eration, since the great strikes of 1900 and 1902, similar in- 
 dustrial machinery for settling questions of employment be- 
 tween employes and employers. Thus in this industry there 
 was already " recognition of the union " by employers and 
 accompanying industrial institutions for the control and set- 
 tlement of controversies. This is not true, however, of all 
 the coal-producing States for in some, such as West Virginia 
 for illustration, the operators still opposed the union and con- 
 ducted out-and-out non-union mines. 
 
 But at the time the United States Government through the 
 necessities of war times assumed control of the coal mining 
 industry, as it had of the railway and shipping industries, it 
 found available for its use in the greater part of the industry 
 this well organized collective bargaining machinery. It was 
 taken over and used virtually as it then existed. For the pur- 
 pose of exercising the necessary centralized control over the 
 industry the United States Fuel Administration was created, 
 and within this organization there was established a Bureau of 
 Labor to which all matters relating to labor conditions and 
 controversies in the coal mines were referred for settlement. 
 Mr. John P. White, formerly President of the United Mine 
 Workers of America, and Mr. Rembrandt Peale, a coal opera- 
 tor from the central Pennsylvania fields, were appointed joint 
 heads of this bureau, with power to consider and dispose of all 
 matters affecting labor in the industry coming within the jur- 
 isdiction of the Fuel Administration and subject to the pro- 
 cedure prescribed in the already existing joint agreements en- 
 tered into by the operators and miners prior to the war. 
 
 The general labor policy of the Wilson Administration al- 
 ready described ' was made effective in the coal mining as in 
 the railroad and shipbuilding industries. In conformity there- 
 with these rules were enunciated by the Fuel Administration 
 for the guidance of employers and employes: 
 
 1 Chapter VIII, pages 80-88.
 
 ii 4 THE WORKERS AT WAR 
 
 No strike was to take place pending the settlement of any 
 controversy until the dispute had been reviewed and decided 
 by the Fuel Administration. 
 
 Where there was a joint agreement or contract between em- 
 ployer and employes, the machinery provided therein for the 
 settlement of controversies was to be invoked and the remedy 
 exhausted without reaching an adjustment before the Fuel 
 Administrator was to intervene or mediate. 
 
 The Fuel Administration recognized the authority of the 
 United Mine Workers of America in the organized coal fields 
 and its jurisdiction over controversies arising in those fields. 
 
 Recognition of the union was not to be exacted during the 
 continuance of the war except where already recognized by col- 
 lective bargaining. 
 
 In coal mines where the union was dominant, that is, in mines 
 where preference in employment was given to union members, 
 this practice was to continue ; where it was the practice for both 
 union and non-union men to work together, its continuance 
 was not to be deemed a grievance by union employes. 
 
 Employers were required to relinquish the right to discharge 
 employes because of affiliation with labor unions. 
 
 Employers were required to recognize the right of their 
 employes to organize into unions by peaceful methods that 
 did not interrupt production. 
 
 An automatic penalty clause was attached to all agreements 
 affecting the bituminous coal mines 1 and was made a condi- 
 tion precedent to the allowance by the Fuel Administration of 
 increased prices to the operators. 2 This clause was directed 
 towards the prevention of a stoppage in production by reason 
 of labor disputes so as to secure the maximum output. 
 
 Economic conditions surrounding the soft coal industry in 
 ordinary times had been such that the average number of days 
 worked in the year were hardly ever more than 230, and quite 
 often even less, so that the average hours of labor each day had 
 fallen considerably below the eight hours stipulated in the wage 
 agreement. This was a serious handicap to continuous max- 
 imum production. To add to this already aggravated situation 
 effecting a limitation of production, coal miners as a class were 
 
 1 This did not apply to the anthracite fields of Pennsylvania. 
 
 2 To cover wage increases.
 
 GOVERNMENT AND COAL MINE WORKERS 115 
 
 not exempted under the provisions of the draft act and in 
 consequence considerable inroads had been made upon the 
 supply of mine labor by the first draft. Then, too, the war 
 had not only stopped completely all immigration from Europe 
 into the coal fields, which was the principal source of unskilled 
 labor supply for the mines, but its effect was also to call to 
 Europe many of the nationalities that made up the skilled coal- 
 mining population. In view of these conditions and of the 
 enormously increased demand for coal, it was vitally neces- 
 sary that something be done to make it possible for miners to 
 work in the mines the full eight hours a day during at least 
 five days each week, Saturday being a half holiday. If this 
 were possible enough coal could be produced to eliminate all 
 fear of a fuel shortage. 
 
 This was the result aimed at by means of fines automatically 
 imposed under the penalty clause. They were quite distinct 
 from the penalizing fines levied by employers for their own 
 benefit, and they operated to protect the great majority of the 
 mine workers against the radical and indifferent element 
 among the employes engaged in coal mining. 
 
 The payment to the worker of a bonus in any form by the 
 operator was stated by the Fuel Administration to be con- 
 trary to the spirit of the wage agreements, and it was with 
 the view of prohibiting the bonus practice that the Administra- 
 tion announced that " if any operator hereafter undertakes to 
 pay a bonus in any form in violation of the terms or spirit of 
 the agreements " the Administration would assume that the 
 mine price of coal allowed the offending operator was too high 
 and accordingly its reduction would be ordered. A conference 
 of coal operators themselves went even further and requested 
 the Administration " to close down any mine that persists in 
 the payment of bonuses or other violations of the Washington 
 wage agreements and the rules and regulations of the Fuel 
 Administration." The conference emphasized the fact that the 
 payment of bonuses, premiums, prizes, and so on, had a dis- 
 organizing effect in causing competition for labor, with the re-
 
 ii6 THE WORKERS AT WAR 
 
 suit that some mines got more than their needed supply of 
 workers while other mines were rendered idle or nearly so on 
 that account. The practice also caused dissatisfaction among 
 the miners as a whole, besides resulting in limitation to pro- 
 duction through the time lost by men shifting from one mine 
 to another in competition for the highest wages. 
 
 An increase in wages to bituminous coal mine workers was 
 granted in an agreement entered into October 6, 1917, between 
 operators and mine employes of the Central Competitive Ter- 
 ritory in conference with the Fuel Administration. These 
 included an advance of ten cents a ton to miners; advances 
 ranging from seventy-five cents to one dollar and forty cents a 
 day to laborers; and an advance of 15 per cent, to workers 
 employed on yardage and dead work. These were equivalent 
 to an increase to miners of 50 per cent, and to the best paid 
 laborers of 78 per cent, over the wages, of April i, 1914. 
 
 The anthracite operators and mine workers on May 5, 1916, 
 had entered into their usual agreement covering wages and 
 working conditions in the hard coal fields of Pennsylvania, and 
 this was to extend over the four-year period from April I, 
 1916, to March 31, 1920. The abnormal conditions resulting 
 from the war, however, and in particular the rapid rise in the 
 cost of living to the workers, made necessary a revision of the 
 terms of this agreement to the extent of increasing the wage 
 compensation. Accordingly a supplementary agreement was 
 entered into on April 25, 1917, providing for wage increases. 
 Subsequently, in November of the same year, a further re- 
 vision was made with the consent of the Fuel Administration 
 granting an additional increase in wages. 
 
 These increases in wages and other improved conditions of 
 employment in coal mining, as in the shipbuilding and railway 
 industries, were brought about through organized machinery 
 operating under the direct supervision of the United States 
 Government and in conformity with the principles of the labor 
 policy adopted at the beginning of the war by the Wilson Ad-
 
 GOVERNMENT AND COAL MINE WORKERS 117 
 
 ministration. This machinery, as has been said, was largely 
 an adaptation to the necessities of war time of the results of 
 institutional development which the progress of the labor move- 
 ment in peace times had brought about. Its operation by the 
 Government was unquestionably the success it proved to be, 
 insofar as the securing of continuous production by minimizing 
 the number of strikes and lockouts is considered, largely be- 
 cause the appeal to the patriotic motives of both employers and 
 employes was strong enough to override for the time being 
 their conflicting economic self-interests as competitors in the 
 distribution of the proceeds of cooperative industry. This suc- 
 cess was also due, in no small degree, to the fact that in the 
 operation of this machinery the Government shifted the greater 
 part of the economic burden of the war from wages and profits 
 to prices from the shoulders of the wage worker and the 
 capitalist-producer to those of the consumer. It did this by 
 granting to the manufacturers and other producers increases in 
 the price of their product at least equal to the increases in 
 wages to the workers to meet the increase in their cost of 
 living. 
 
 In making this statement the writer is conscious of the ex- 
 istence of plausible arguments which would seem to refute this 
 conclusion. Assuming the absence of Government direction of 
 this machinery, it is quite possible and even probable that 
 prices of commodities under uncontrolled competition in a 
 sellers' market would have been even higher to the consumer 
 than they actually were. But the conclusion is based on the 
 fact that, assuming Government direction, it was possible to 
 have brought about a situation in which the wages of the 
 worker and especially the profits of the manufacturer would 
 have borne a larger share and therefore prices to the consumer 
 a more equitable share of the cost of the war. It is a question 
 not of the results under two different sets of circumstances but 
 of the effects of a choice of policy under the same circum- 
 stances. The phase of the situation as it affected prices to
 
 ii8 THE WORKERS AT WAR 
 
 the consumer is discussed in succeeding chapters. Here we 
 are concerned with only two of the three elements to successful 
 production with only the capitalist -producer and the wage 
 worker in relation to each other and to the Government.
 
 CHAPTER XII 
 
 THE GOVERNMENT AND INDUSTRIAL RELATIONS 
 
 IN all those industries engaged in the production of war 
 essentials, direct control of which was not taken over by 
 the Government and there were hundreds and thousands of 
 mills, plants, and factories making up these industries in all 
 these the labor policy of the Wilson Administration was made 
 operative through special provisions in the usual form of con- 
 tract which was entered into by the Government departments 
 with the manufacturer. 
 
 In these contracts the producer agreed that : ( i ) there 
 would be no interruption to continuous and maximum produc- 
 tion on his part because of any labor controversy with his em- 
 ployes; (2) all such controversies were to be referred for set- 
 tlement if necessary to designated Government departments 
 providing machinery for mediation, conciliation, and arbitra- 
 tion: and (3) he would accept and abide by the decision ren- 
 dered by this governmental agency. The contract required of 
 the manufacturer that he was to have it understood by every 
 worker accepting employment in his plant that he did so with 
 the definite agreement to accept and abide by the decisions of 
 the Government tribunal in the settlement of any question af- 
 fecting labor submitted to it for adjudication. 
 
 In this very simple way thousands of industries employing 
 millions of men, women, and children in the production of 
 war essentials were brought under the terms and conditions of 
 employment, especially as to wages and hours of work, as 
 laid down by the United States Government. Over these con- 
 ditions the Government exercised supervision through its 
 various departments and bureaus and commissions. For this 
 
 119
 
 120 THE WORKERS AT WAR 
 
 purpose and to develop and maintain satisfactory relations be- 
 tween employers and employes while both were engaged upon 
 government war work, there were organized within the de- 
 partments numerous industrial service and industrial relations 
 sections, boards of control, committees, commissions, and so on. 
 So numerous were these that it is not possible to refer to all of 
 them. But the general character of their work can be indi- 
 cated by calling brief attention to the operation of a selected 
 few. 
 
 For the adjustment and control of wages, hours of work, 
 and other conditions of employment for workers of contractors 
 engaged in the construction of cantonments and army camps 
 there was established in the construction division of the War 
 Department the Cantonment Adjustment Commission, after- 
 wards the Emergency Construction Adjustment Commission. 
 It was composed of three members appointed by the Secretary 
 of War, one to represent the Army, one the public, and one the 
 workers, the latter representative being nominated by the 
 president of the American Federation of Labor. 
 
 The principles governing the labor policy of this commis- 
 sion were embodied in what became known as the Baker- 
 Gompers agreement. This agreement provided as basic stand- 
 ards in each cantonment the union scale of wages, hours 
 of work, and other conditions of employment in effect on June 
 i, 1917, in the particular locality where the cantonment was 
 situated. Consideration was to be given to special circum- 
 stances arising that should require advances in wages or 
 changes in other terms of employment. 
 
 An official interpretation of this understanding 1 made it 
 clear that the War Department did not agree nor did it commit 
 itself to the so-called " closed shop," and that the conditions in 
 effect on June i, 1917, which were adopted as the basis of the 
 agreement, did not include any provisions as to the employment 
 of non-union labor. These " conditions " were interpreted as 
 
 1 Correspondence between Mr. Samuel Gompers and Louis B. Wehle, 
 Esq., under date of June 20 and 22, 1917.
 
 INDUSTRIAL RELATIONS 121 
 
 applying only to union arrangements as to overtime and work 
 on holidays and like matters. It was not believed to be le- 
 gally feasible to adopt any understanding in such an agreement 
 giving preference to the employment of union labor. Later the 
 provisions of this Baker-Gompers agreement were applied to 
 all land construction work of the War Department, the com- 
 mission's jurisdiction being extended to the construction of 
 aviation fields and warehouses and storage facilities. 
 
 The agreement provided for sessions of the commission in 
 Washington " unless specially ordered by the Secretary of 
 War to go to the site of a construction." The commission 
 was to obtain complete information of union scales of wages, 
 hours of work, and other conditions of employment in effect 
 on June I, 1917, in the several localities where cantonments 
 were being constructed from data supplied, as far as prac- 
 ticable, by the federal Department of Labor. 
 
 As the cantonment sites were distributed throughout all sec- 
 tions of the country, the Secretary of War was to appoint, for 
 the period of construction and with the unanimous approval of 
 the commission, a responsible impartial examiner for each dis- 
 trict who was to act under orders of the commission. 
 
 In case a dispute arose which it developed could not be 
 adjusted satisfactorily by the contracting officer at the site 
 and the employes involved, the officer was to issue a pro- 
 visional order which was subject to being affirmed, reversed, 
 or modified by the commission. The actual work of construc- 
 tion was not to be interrupted. In case this provisional order 
 was not accepted by the employes the contracting officer was 
 to notify the member of the commission representing the Army 
 of the matter in dispute, the proposals made by each party 
 for adjustment, and of the provisional order which he had 
 issued. At the same time the member of the commission desig- 
 nated by Mr. Gompers was also to obtain from a reliable source 
 a report on the matter in dispute. In case the controversy was 
 not adjusted satisfactorily at the site, the commission was to 
 send at once an examiner, with authority and acting under the
 
 122 THE WORKERS AT WAR 
 
 orders of the commission, to mediate between the parties. 
 Failing in this the examiner was to report promptly and fully 
 to the commission with a recommendation. If ordered by the 
 commission or any of its members the examiner was to remain 
 at the site to supply any further information that might be 
 requested. The examiner was to supervise the application of 
 the commission's rulings. A copy of the rulings was to be 
 sent to the contracting officer and to the representatives of the 
 parties involved in the controversy. 
 
 The Government's policy as to hours of work by employes 
 of all Government contractors was embodied in the contract. 
 The progress of industrial development, the activities of or- 
 ganized labor in the direction of shorter hours of work, and 
 the influence of statutory enactments had all been tending 
 towards decreasing the work day from twelve, ten, and nine 
 hours to eight hours as the standard. The National Govern- 
 ment had established this standard for its own employes by the 
 Act of Congress of June 19, 1912, known as the Eight Hour 
 Law. Thus slowly and steadily by voluntary action of em- 
 ployers, by the demands of the labor union, and by the force 
 and example of law a shorter work day was being made ef- 
 fective in all the principal industries. To the organized worker 
 such a standard work day of reasonably limited length was as 
 much a matter of justice as was the rate of his pay, and the 
 securing of it was the cause of almost as many strikes as was 
 his demand for higher wages. But he consistently objected to 
 it if its establishment meant a minimizing of his wage returns. 
 
 War necessity, however, demanded not a decrease but rather 
 an increase in the hours of work each day. In fact, so great 
 was the need of increased production along so many lines that 
 President Wilson deemed it advisable to authorize in Executive 
 Orders the suspension of the provisions of the Eight Hour 
 Law. This possibility had been anticipated in the Naval Ap- 
 propriation Act of Congress approved March 4, 1917, in which 
 it was provided " That in case of national emergency the Pres- 
 ident is authorized to suspend provisions of law prohibiting
 
 INDUSTRIAL RELATIONS 123 
 
 more than eight hours of labor in any one day of persons en- 
 gaged upon work covered by contracts with the United States: 
 Provided further, That the wages of persons employed upon 
 such contracts shall be computed on a basic day rate of eight 
 hours work, with overtime rates to be paid for at not less than 
 time and one-half for all hours worked in excess of eight 
 hours." 
 
 The application of this provision resulted in the continuance 
 of the ten hour day in many industries already operating on 
 that basis and in the extension from eight to ten hours of the 
 working time of many Government plants, such as arsenals, 
 as well as of factories having the eight hour day and under 
 contract with the Government. But in going to the ten hour 
 day basis overtime rates were paid for all time worked each 
 day beyond eight hours. This meant, for illustration, that a 
 mechanic being paid a rate of eighty cents an hour and who 
 consequently earned $6.40 a day, received on the time and one- 
 half basis for overtime $1.20 cents additional for every hour 
 worked beyond eight hours. If he worked nine hours he 
 earned the basic $6.40 plus the $1.20, or $7.60, and if he worked 
 ten hours he received the basic $6.40 plus $2.40, or $8.80. 
 If the mechanic happened to be a member of one of the crafts 
 that had succeeded in establishing the double time basis of pay 
 for overtime beyond eight hours, he received twice the basic 
 hourly rate of eighty cents, or $1.60, for every hour worked 
 beyond the eight hours. This time and one-half and double 
 time rate for all overtime, which organized labor had suc- 
 ceeded in establishing in many industries prior to the war, was 
 intended primarily as a penalty against excessive overtime but 
 under war emergency conditions it became all too frequently 
 the means of increasing the day wage rate. 
 
 In carrying out in other directions the labor policy of the 
 Wilson Administration various departments of the Govern- 
 ment, having contracts with large numbers of manufacturers, 
 issued general regulations embodying detailed rules governing 
 employment which the manufacturer and employes were to ob-
 
 124 THE WORKERS AT WAR 
 
 serve. These working conditions as formulated by the Ord- 
 nance 1 and the Quartermaster's Departments of the Army give 
 a comprehensive view of the principles of industrial relations 
 which it was believed should prevail in industries turning out 
 contract orders for the Government. They were adopted as 
 the standards by other branches of the Government and made 
 quite generally effective. 
 
 The following suggestions are commended to the careful con- 
 sideration of arsenal commanders and manufacturers executing 
 orders for this department : 
 
 In view of the urgent necessity for a prompt increase in the 
 volume of production of practically every article required for 
 the conduct of the war, vigilance is demanded of all those in 
 any way associated with industry, lest the safeguards with 
 which the people of this country have sought to protect labor 
 should be unwisely and unnecessarily broken down. 
 -. It is a fair assumption that for the most part these safeguards 
 are the mechanisms of efficiency. Industrial history proves 
 that reasonable hours, fair working conditions, and a proper 
 wage scale are essential to high production. During the war 
 every attempt should be made to conserve in every possible way 
 all of our achievements in the way of social betterment. 
 
 In the preparation of the following memorandum no effort 
 has been made to establish or even to suggest definite rules of 
 conduct. The memorandum presents what may be considered 
 a fair if tentative basis. 
 
 The department wishes to be assured that schedules of hours 
 obviously excessive or wage scales distinctly unfair or working 
 conditions such as should not be tolerated will certainly be 
 brought to its attention. 
 
 I. HOURS OF LABOR 
 
 i. Daily Hours The day's work should not exceed the cus- 
 tomary hours in the particular establishment or the standard 
 already attained in the industry and in the community. It 
 should certainly not be longer than ten hours for an adult work- 
 man. The drift in the industrial world is toward an eight hour 
 day as an efficiency measure. It has also been shown that 
 
 1 General Orders No. 13, Chief of Ordnance, November 15, 191?.
 
 INDUSTRIAL RELATIONS 125 
 
 hours of labor must be adapted to the age and sex of the worker, 
 and the nature of the occupation. 
 
 2. Overtime The theory under which we pay " time and a 
 half " for overtime is a tacit recognition that it is usually un- 
 necessary and always undesirable to have overtime. The ex- 
 cess payment is a penalty and intended to act as a deterrent. 
 There is no industrial abuse which needs closer watching in 
 times of war. 
 
 3. Shifts in Continuous Industries Eight hours per shift 
 should be a maximum in continuous twenty-four hour work. 
 
 4. Half Holiday on Saturday The half holiday on Satur- 
 day is already a common custom in summer, and it is advan- 
 tageous throughout the year, especially if the work day be ten 
 hours long the other days of the week. The working period 
 on Saturday should not exceed five hours. An occasional shift 
 of two or three hours on Saturday afternoon is unobjectionable 
 if essential, but the additional hours should be regarded as 
 overtime and paid for on that basis. 
 
 5. Hours Posted It is desirable that the hours of labor for 
 every tour be p.osted. 
 
 6. Holidays The observance of national and local holidays 
 will give opportunity for rest and relaxation which tend to 
 make production more satisfactory. 
 
 7. One Day of Rest in Seven One day of rest in seven 
 should be a universal and invariable rule. 
 
 II. STANDARDS IN WORKROOMS 
 
 1. Protection Against Hazards and Provisions for Comfort 
 and Sanitation Existing legal standards to prevent danger 
 from fire, accident, occupational diseases, or other hazards, and 
 to provide good light, adequate ventilation, sufficient heat, and 
 proper sanitation should be observed as minimum requirements. 
 
 2. Location of Toilets All toilets should be sanitary and 
 readily accessible. 
 
 3. Extreme Temperatures Those processes in which work- 
 ers are exposed to excessive heat, that is, over eighty degrees; 
 or excessive cold, that is, under fifty degrees, should be care- 
 fully supervised so as to render the temperature conditions as 
 nearly normal as possible. When extreme temperatures are 
 essential workers should not only be properly clothed but avoid 
 sudden changes. 
 
 4. Lights If any light is at the level of the worker's eyes it 
 should be so shaded that its rays will not directly strike the eyes.
 
 126 THE WORKERS AT WAR 
 
 III. WAGES 
 
 i. Wage Standards Standards already established in the 
 industry and in the locality should not be lowered. The mini- 
 mum wage rates should be made in proper relation to the cost 
 of living, and in fixing them it should be taken into considera- 
 tion that the prices of necessities of life have shown great in- 
 creases. 
 
 IV. NEGOTIATIONS BETWEEN EMPLOYERS AND EMPLOYES 
 
 The need of preserving and creating methods of joint nego- 
 tiations between employers and groups of employes is especially 
 great in the light of the critical points of controversy which 
 may arise in a time like the present. Existing channels should 
 be preserved and new ones opened, if required, to provide for 
 easier discussion between an employer and his employes over 
 controversial points. 
 
 V. STANDARDS FOR EMPLOYMENT OF WOMEN 
 
 1. Hours of Labor Existing legal standards should be 
 rigidly maintained, and even where the law permits a nine or 
 ten hour day, effort should be made to restrict the work of 
 women to eight hours. 
 
 2. Prohibition of Night Work The employment of women 
 on night shifts should be prevented as a necessary protection, 
 morally and physically. 
 
 3. Rest Periods No woman should be employed for a longer 
 period than four and one-half hours without a break for a 
 meal, and a recess of ten minutes should be allowed in the 
 middle of each working period. 
 
 4. Time for Meals At least thirty minutes should be allowed 
 for a meal, and this time should be lengthened to forty-five 
 minutes or an hour if the working day exceeds eight hours. 
 
 5. Place for Meals Meals should not be eaten in the work- 
 room. 
 
 6. Saturday Half Holiday The Saturday half holiday 
 should be considered an absolute essential for women under 
 all conditions. 
 
 7. Seats For women who sit at their work, seats with 
 backs should be provided, unless the occupation renders this 
 impossible. For women who stand at their work, seats should 
 be available and their use permitted at regular intervals. 
 
 8. Lifting Weights No woman should be required to lift
 
 INDUSTRIAL RELATIONS 127 
 
 repeatedly more than twenty-five pounds in any single load. 
 
 9. Replacement of Men by Women When it is necessary to 
 employ women in work hitherto done by men, care should be 
 taken to make sure that the task is adapted to the strength of 
 women. The standard of wages hitherto prevailing for men 
 in the process should not be lowered where women render 
 equivalent service. The hours for women engaged in such 
 processes, of course, should not be longer than those formerly 
 worked by men. 
 
 10. Tenement House Work No work shall be given out to 
 be done in rooms used for living purposes or in rooms directly 
 connected with living rooms in any dwelling or tenement. 
 
 VI. STANDARDS FOR EMPLOYMENT OF MINORS 
 
 1. Age No child under fourteen years of age shall be em- 
 ployed at any work under any conditions. 
 
 2. Hours of Labor No child between the ages of four- 
 teen and sixteen years shall be employed more than eight hours 
 a day or forty-eight hours a week, and night work is prohibited. 
 
 3. Federal Child Labor Laws These and other provisions 
 of the Federal child labor law must be strictly observed. 
 
 4. Minors Under Eighteen Minors of both sexes under 
 eighteen years of age should have the same restrictions upon 
 their hours as already outlined for women employes. 
 
 \Vithin the Ordnance Department of the Army an Industrial 
 Service Section exercised control over all matters pertaining 
 to labor engaged in the production of ordnance supplies, equip- 
 ment, and material, including the work at the Government ar- 
 senals. Its jurisdiction covered specifically all subjects con- 
 cerning hours of labor, rates of pay, housing, transportation, 
 dilution of labor, women in industry, community conditions 
 affecting labor, stealing of labor by one employer from another, 
 prevention of wage or other labor disputes, supply and distribu- 
 tion of labor essential to ordnance production, relations on all 
 these matters with the industrial service sections of other pro- 
 curement bureaus and with the office of the Secretary of War. 
 the Department of Labor, the Public Health Service on mat- 
 ters affecting health, safety, and sanitation, and with all other 
 agencies dealing with labor.
 
 128 THE WORKERS AT WAR 
 
 There was a like service section in the Signal Corps bureau 
 of the War Department, and similarly an industrial relations 
 section in the Bureau of Aircraft Production in charge of all 
 such matters affecting the production of aircraft. A like sec- 
 tion in the Quartermaster's Department of the Army had jur- 
 isdiction over related matters in all plants carrying contracts 
 of that department, with the exception of those of the needle 
 trades, and these contracts were very numerous. 
 
 For the so-called needle trades engaged principally in the 
 making of clothing for the troops, a special Board of Control 
 was organized as these industries presented problems fre- 
 quently quite different from those of ordinary production. 
 The head of this board had the title " Administrator of Labor 
 Standards," and his work was confined to the trades engaged 
 in the production of army clothes. Its duties stressed safety, 
 sanitation, and healthful conditions in clothing factories more 
 than they did the settlement of labor disputes, although these 
 latter were within its jurisdiction, an investigation in 1917 hav- 
 ing disclosed that Army clothing was being manufactured in 
 some cases under conditions not in accord with standards which 
 should be maintained on work done for the Government. The 
 operation of the board was directed against sweatshop and 
 similar conditions which had long before the war been recog- 
 nized as serious industrial evils. It aimed to establish and en- 
 force the observance of sound industrial and sanitary condi- 
 tions in the manufacture of Army clothing, in the inspection 
 of factories, in the establishing of proper standards on Gov- 
 ernment work, in passing upon the industrial standards main- 
 tained by bidders on Army clothing, and in all respects to bring 
 about more just working conditions in this industry. 
 
 Supervision over the wage rates of all employes of manu- 
 facturers supplying to the Government leather goods, harness 
 and accessories, not including shoes, was vested in the National 
 Harness and Saddlery Adjustment Commission, consisting of 
 one representative each of the War Department, of the em- 
 ployers, and of the International Leather Worker's Union.
 
 INDUSTRIAL RELATIONS 129 
 
 For the purpose of adjusting wages in the navy yards and 
 arsenals an Arsenal and Navy Yards Commission was jointly 
 created by the Secretaries of War and Navy. It was to have 
 jurisdiction of cases that were not settled by representatives of 
 the particular departments but as this was successfully ac- 
 complished in every case the commission itself was not called 
 upon to function. General supervision over wage matters in 
 navy yards was placed under an assistant to the Assistant Sec- 
 retary of the Navy and in arsenals under a major in the office 
 of the Secretary of War. Original jurisdiction over industrial 
 relations in the navy yards was placed under the commanding 
 officer or industrial manager. In the so-called " outside " 
 plants working on navy contracts these matters were under 
 the production inspector who was charged with reporting to 
 the Department direct. In case of a strike the Navy Depart- 
 ment depended upon the most convenient available adjusting 
 machinery or governmental agency. In the Bureau of Yards 
 and Docks of the Department, which had charge of consider- 
 able building construction work, commissioned officers were 
 specially assigned to look after wage and other labor matters. 
 
 Under the Emergency Fleet Corporation an Industrial Re- 
 lations Division operated separately and distinct from the Ship- 
 building Wage Adjustment Board of the United States Ship- 
 ping Board. Its service section counseled and advised as to 
 scientific employment, administered draft deferments, and su- 
 pervised transfers and related matters in the handling of the 
 personnel in the shipyards. Its health and sanitation section 
 assisted and cooperated with shipyard communities in all mat- 
 ters affecting the health and physical welfare of the shipyard 
 workers. Its safety engineering section directed efforts 
 towards reducing and minimizing the number of accidents not 
 only in the building of ships but also in the construction of 
 ship material, recommending machine guards and safety de- 
 vices and conducting safety campaigns of education among the 
 workers. Its education and training section instituted train- 
 ing centers in different parts of the country fpr qualifying
 
 130 
 
 workers to do shipyard work and also for increasing the skill 
 of employes already in the yards. The Industrial Relations 
 group in the Emergency Fleet Corporation also contained a 
 labor administration section for advising and counseling con- 
 tractors, especially of plants supplying ship accessories, in the 
 proper handling of disputes with their employes. 
 
 An Industrial Relations Division, in charge of a manager 
 and with a corps of special representatives and welfare direc- 
 tors, operated within the United States Housing Corporation 
 and had jurisdiction over all the labor matters having to do 
 with the construction of the eighty-seven building projects of 
 the Corporation in all parts of the country. This division for- 
 mulated the principles governing the relations of the housing 
 contractors with their 37,000 employes and supervised the se- 
 curing of an adequate supply of labor, the wages paid, hours 
 of work, prevention of accidents, settlement of controversies, 
 provisions for the health, comfort, and welfare of the work- 
 ers at isolated projects, and all the other multitudinous phases 
 of the labor problem in war times. 1 
 
 The work of these and other industrial service or relations 
 sections or divisions in the direction of the application of the 
 labor policy of the Wilson Administration was carried on in 
 close cooperation with that of other branches of the Govern- 
 ment, and in particular with that of the Department of Labor, 
 so that it was correlated and made to accomplish with as little 
 friction as possible a continuity in production. This goal of 
 uninterrupted production was their primary object. 
 
 1 For an interesting account of the detailed facts that go to make 
 up so many labor controversies see Report of Industrial Relations 
 Division in Vol. r of Report of United States Housing Corporation, 
 Department of Labor, Washington, D. C
 
 CHAPTER XIII 
 THE NATIONAL WAR LABOR BOARD 
 
 THAT the national Government found it necessary to call 
 into existence so many agencies for the control of labor 
 relations in production should not be surprising when it is re- 
 membered that the Government was engaged in the operation 
 of a nation-wide workshop, with plants in every State and 
 almost every city employing millions of workers in thousands 
 of different occupations surrounded by special labor condi- 
 tions. The wonder is that the task was accomplished with so 
 few such agencies. Among the most important of these is the 
 National War Labor Board recommended by the War Labor 
 Conference Board 1 in its report of March 29 and created by 
 Presidential Proclamation April 8, 1918. This board had jur- 
 isdiction over all matters of labor controversies between em- 
 ployers and employes in all fields of industrial or other activity 
 affecting war production where there did not already exist by 
 agreement or federal law a means of settlement. Even where 
 such agencies were provided, jurisdiction was with the War 
 Labor Board in case these agencies failed to secure adjust- 
 ment. 
 
 " The powers, functions, and duties of the National War 
 Labor Board," says President Wilson's Proclamation, " shall 
 be : To settle by mediation and conciliation controversies aris- 
 ing between employers and workers in fields of production 
 necessary for the effective conduct of the war, or in other 
 fields of national activity, delays and obstructions in which 
 might, in the opinion of the National Board, affect detri- 
 mentally such production ; to provide, by direct appointment, 
 
 1 See Chapter VIII, page 85. 
 
 131
 
 132 THE WORKERS AT WAR 
 
 or otherwise, for committees or boards to sit in various parts 
 of the country where controversies arise and secure settlement 
 by local mediation and conciliation ; and to summon the parties 
 to controversies for hearing and action by the National Board 
 in event of failure to secure settlement by mediation and 
 conciliation." 
 
 The principles observed and the methods followed by the 
 War Labor Board in exercising its powers and functions and 
 in performing ks duties were those specified in the report of 
 the Labor Conference. 1 The board was to refuse to take cog- 
 nizance of a controversy between employer and employes where 
 there was a means of settlement which had not been invoked. 
 The Proclamation of the President urged upon all employers 
 and employes within the United States " the necessity of utiliz- 
 ing the means and methods thus provided for the adjustment of 
 all industrial disputes," and requested that " during the pend- 
 ency of mediation or arbitration through the said means and 
 methods there shall be no discontinuance of industrial opera- 
 tions which would result in curtailment of the production of 
 war necessities." 
 
 The War Labor Board consisted of the same members se- 
 lected in the same manner and by the same agencies as the 
 War Labor Conference Board. It was provided in the report 
 outlining the organization of the board that if its efforts failed 
 to bring about a voluntary settlement, and its members were 
 unable unanimously to agree upon a decision, then in that case 
 and only as a last resort, an umpire was to hear and finally 
 decide the controversy under simple rules of procedure pre- 
 scribed by the board. The umpire was to be chosen by unani- 
 mous vote of the board, failing which the name of the umpire 
 was to be drawn by lot from a list of ten suitable and dis- 
 interested persons nominated for the purpose by the President 
 of the United States. These ten men were Mr. Henry Ford 
 of Detroit ; Mr. Matthew Hale of Boston ; Mr. J. Harry Cov- 
 ington and Mr. Charles C. McChord of Washington, D. C. ; 
 
 1 See Chapter VIII, page 86.
 
 THE NATIONAL WAR LABOR BOARD 133 
 
 Mr. V. Evcrit Macy and Mr. William R. Willcox of New 
 York ; Mr. Julian W. Mack of Chicago ; Mr. Henry Suzzallo 
 of Seattle; Mr. John Lind of Minneapolis; and Mr. Walter 
 Clark of Raleigh, N. C. 
 
 The place of each member of the board unavoidably de- 
 tained from attending one or more of its sessions was to be 
 filled by a substitute to be named by such member, the substi- 
 tute having the same representative character as his principal. 
 
 The action of the board could be invoked in respect to con- 
 troversies within its jurisdiction by the Secretary of Labor or 
 by either side in a controversy or its duly authorized repre- 
 sentative. The board, after summary consideration, could re- 
 fuse further hearing if the case was not of such character or 
 importance to justify it. 
 
 In the appointment of committees of its own members to act 
 for the board in general or local matters, and in the creation of 
 local committees, the employers and the workers were to be 
 equally represented. 
 
 The two representatives of the public in the board were to 
 preside alternately at successive sessions of the board or as 
 agreed upon. 
 
 The policy to be observed by the board in its mediating and 
 conciliatory action, and by the umpire in his consideration of 
 a controversy, were outlined in the report of the Conference 
 Board. 1 
 
 The plan of procedure and method that was followed in 
 cases within its jurisdiction provided for the appointment of 
 subcommittees of two members to act for the board in every 
 local controversy, and the appointment of permanent local com- 
 mittees in cities and districts to act in cases therein arising. 
 A method of investigating industrial disputes by field agents 
 sent into territories by the board from Washington was also 
 provided for, as was also the method to be followed by per- 
 sons desiring to bring a condition to the attention of the board. 
 
 Under its form of procedure the board sat in hearing only 
 
 1 See Chapter VIII, page 86.
 
 i 3 4 THE WORKERS AT WAR 
 
 when its sections or subcommittees or local committees found 
 it impossible to settle a controversy, and then it sat as a board 
 of arbitration to decide the controversy and make an award. 
 
 In compliance with the direction of the President's Procla- 
 mation the board heard appeals in the following cases: (i) 
 Where the principles established by him in such Proclamation 
 had been violated; (2) where an award made by a board had 
 not been put into effect, or where the employes had refused to 
 accept or abide by such award; (3) determination of questions 
 of jurisdiction as between Government boards. 
 
 No attempt will be made here to present the many activities 
 of the board or even to summarize its decisions in the more 
 important labor controversies. Many of those that came be- 
 fore it for settlement were similar, as to the industrial issues 
 involved and in many of their details, to those confronting 
 other agencies of the Government which have already been 
 discussed. Several decisions involving broad economic prin- 
 ciples will be referred to briefly. 
 
 In readjusting the wage schedules in eight plants at 
 Waynesboro, Pennsylvania, the board fixed forty cents an hour 
 as the minimum rate to be paid any class of workers, including 
 common laborers. This minimum however, was not to be re- 
 garded as the living wage standard, which latter is the minimum 
 wage that permits or enables the worker and his family to 
 subsist in health and reasonable comfort. In this case the 
 award of the board gave many of the workers wage increases 
 considerably in excess of their demands, to gain which they 
 had gone out on strike. They had demanded for common 
 laborers a minimum of thirty cents an hour, these workers at 
 the time receiving as little as twenty-two cents an hour. The 
 increase to the lowest paid men thus amounted to 81 per cent. 
 The board did not decide to establish generally throughout in- 
 dustry this minimum wage of forty cents an hour. Its policy 
 was to determine and apply a fair living wage in each case on 
 the basis of the particular facts. 
 
 This principle is illustrated in its decisions in street railway
 
 THE NATIONAL WAR LABOR BOARD 135 
 
 controversies many of which came before the board. In these 
 cases the board established a different rate for street car em- 
 ployes in the smaller city doing similar work to employes in 
 the large city. While in all cases substantial wage increases 
 were granted the rates established varied, there being no flat 
 minimum or maximum that was applied generally. Wages for 
 motormen and conductors in the larger cities were fixed at 
 from forty-eight to fifty and one-half cents an hour and the 
 rate for apprentice motormen and conductors at forty-three 
 cents. In the smaller cities the pay for motormen and con- 
 ductors was increased to forty-five cents and for apprentice 
 motormen and conductors to forty-one cents an hour. In the 
 case of small interurban roads, where the employes as a gen- 
 eral thing live in rural communities, the wage for motormen 
 and conductors was fixed at forty-two cents and for appren- 
 tices at thirty-eight cents an hour. Thus the board in fixing 
 the wage rate took into consideration local conditions and 
 such other facts as were applicable in individual cases. 
 
 In many of the street railway cases trackmen, pitmen, pit- 
 men's helpers, controllers, oilers, and so on also demanded 
 increased wages and improved working conditions, and these 
 employes had their wages increased at first in the same ratio as 
 the highest increase to conductors and motormen. It was later 
 found that even this increase did not provide these men with 
 a wage sufficient under the living wage principle, and the arbi- 
 trators therefore later fixed forty-two cents an hour as a mini- 
 mum for these men. In these street railway cases the board 
 formulated a definite policy on the question of the ability to 
 pay increases in wages by street railway corporations, which 
 policy was based upon the facts and arguments presented at its 
 hearings. 
 
 The board's finding in the case of the Bethlehem Steel Cor- 
 poration was one of the most important in many respects of 
 any of its decisions. It granted the workers the right to or- 
 ganize and to bargain collectively ; ordered the revision or com- 
 plete elimination of the bonus system in operation at the plant ;
 
 136 THE WORKERS AT WAR 
 
 directed the revision of piece work rates; established a desig- 
 nated and guaranteed minimum hourly wage rate for some five 
 thousand machine shop workers; applied the payment of time 
 and one-half for all overtime and double time payment for 
 Sundays and holidays ; provided for just overtime payment to 
 piece workers; and called upon the company to pay men and 
 women alike when performing the same work, and to allot 
 women no tasks disproportionate to their strength. 
 
 In the revision of the piece work rajes by the plant m%n- 
 agement it was to cooperate with committees of the workers 
 and representatives of the Ordnance Department, the latter 
 being the Government department principally interested in the 
 output of the plant. A permanent local board of mediation 
 and conciliation, consisting of six members, three chosen by 
 the company and three by the workers, was created to effect 
 agreements on disputed points in the future and on similar 
 matters not covered in the award, the board to be presided 
 over by a chairman selected by and representing the Secretary 
 of War. In addition, an examiner of the board was assigned 
 to interpret and enforce the award, with specific instructions to 
 investigate and report to the board all charges of company dis- 
 crimination against union men. As many as twenty-eight 
 thousand workers were affected by this award. 
 
 Upon the request of employers representing fifty-three firms 
 and corporations employing more than fifty thousand workers 
 in Bridgeport, Connecticut, comprising virtually the entire 
 working industrial population of that city, the board undertook 
 the settlement of wage and other demands that threatened to 
 disrupt the complete system of industrial relations between 
 employers and employes that had been built up in that city. 
 Each of the companies signed an agreement binding it to abide 
 by whatever decision was made by the board. 
 
 The grievances of workers which 'had created the general 
 unrest at Bridgeport throughout six months and more of the 
 war period, during which time several strikes had occurred, 
 included charges by employes that employers organized in the
 
 THE NATIONAL WAR LABOR BOARD 137 
 
 Manufacturers' Association had maintained a " black list " of 
 union workers; the demand for the right of employes to par- 
 ticipate through chosen representatives in a reclassification of 
 workers in the various plants ; and requests for increases in 
 wages to meet the increase in the cost of living. 
 
 In one of its awards the board ordered the General Electric 
 Company to eliminate individual employment contracts in its 
 plant at Pittsfield, Massachusetts, and to establish there a just 
 system of collective bargaining between the company and its 
 men. This decision banishing the individual contract was the 
 first of its kind made by the board. The practice of the com- 
 pany was to submit this contract to the men as they entered 
 upon employment at the plant but the board characterized it as 
 a source of irritation. Its abolition was one of the principal 
 demands of the workers. The order of the board was to the 
 effect that such of the contracts as were then in existence 
 should be discontinued and no others made in the future. 
 Such contracts prevail in a large number of industrial estab- 
 lishments throughout the country and are devised to supplant 
 or take the place of joint bargaining agreements. In place of 
 the individual contract system at the General Electric's plant 
 at Pittsfield the board directed the establishment of a system of 
 employe representation in dealing with labor matters. This 
 comprised the election by the workers of committees from 
 among themselves to represent them in dealing with the firm 
 as to wages, hours, and conditions of employment. Up to the 
 time of the board's award the company had not recognized 
 either committees or individuals representing groups of work- 
 ers at its Pittsfield plant although at its Schenectady plant, 
 where there was a stronger union of its employes, committee 
 representation had been recognized and adopted. 
 
 In the case of the telegraph companies and their employes 
 the board arrived at a decision, the essential points of which are 
 as follows: (i) Employes have a right to join a union if 
 they so desire, and men discharged for belonging to the union 
 should be reinstated; (2) the company should not be required
 
 138 THE WORKERS AT WAR 
 
 to deal with the union or to recognize it; (3) committees of 
 employes should be recognized in presenting grievances; (4) 
 where employes and employers fail to agree, the question in 
 dispute should be determined by the National War Labor 
 Board; (5) the telegraphers' union should not initiate strikes 
 or permit its members to initiate them, but should submit all 
 grievances to the National War Labor Board. 
 
 Officials of the telegraph companies at first balked upon ac- 
 cepting this decision. President Wilson in a letter to the 
 President of the Postal Telegraph Company under date of 
 June n, 1918, stated that in his judgment "It is imperatively 
 necessary in the national interest that decisions of the National 
 War Labor Board should be accepted by both parties in labor 
 disputes. To fail to accept them is to jeopardize the interest 
 of the Nation very seriously, because it constitutes a rejection 
 ef the instrumentality set up by the Government itself for the 
 determination of labor disputes, set up with a sincere desire to 
 arrive at justice in every case and with the express purpose of 
 safeguarding the Nation against labor difficulties during the 
 continuation of the present Avar. All these circumstances being 
 taken into consideration, I do not hesitate to say that it is a 
 patriotic duty to cooperate in this all-important matter with 
 the government, by the use of the instrumentality which the 
 Government has set up. I, therefore, write to ask that I may 
 have your earnest cooperation in this matter, as in all others, 
 and that you will set an example to the other employers of the 
 country by a prompt and cordial acquiescence." 
 
 President Mackay of the Telegraph Company replied to the 
 effect that " this company has done its very utmost since the 
 beginning of the war to assume its full share of responsibility 
 to the v Government and to the public and that, in order to still 
 further sHbw its sincerity and earnest desire to be of service 
 at this time of national trial, we can not but respond to your 
 request that we waive, during the war, our right to discharge 
 employes who join a union, and you may rely upon our doing 
 so."
 
 THE NATIONAL WAR LABOR BOARD 139 
 
 A complete volume could be written on the activities and 
 decisions of the National War Labor Board, and the impor- 
 tance of these to our industrial society are not to be measured 
 by the limited space necessarily accorded to its work here. 
 The principles upon which it operated and the economics of 
 its decisions are deserving of wide practice in all our indus- 
 tries, in peace as much as in war times, if America is to solve 
 successfully the one problem most vital to its continuance as 
 a Nation the problem of justice in the production and dis- 
 tribution of wealth.
 
 CHAPTER XIV 
 
 THE FEDERAL DEPARTMENT OF LABOR 
 
 THE National War Labor Board was only a part of the 
 program formulated by the Council of National Defense 
 for Governmental machinery to be organized and put in mo- 
 tion by the Department of Labor in order to make effective the 
 war labor policy of the Wilson Administration. This federal 
 Department was already in existence, having been separated 
 at the beginning of the Wilson Administration in 1913 from 
 the Department of Commerce and Labor and made an inde- 
 pendent Department with its Secretary a member of the 
 President's Cabinet. To this Department was delegated the 
 task of providing for every phase of the labor problem that 
 affected continuous and maximum war production. 
 
 In designating in January, 1918, Mr. William B. Wilson, the 
 Secretary of Labor, as National Labor Administrator, Presi- 
 dent Wilson clothed that official with full power and wide au- 
 thority. How comprehensive this was is only slightly indicated 
 in the statement that it included housing, transportation, dis- 
 tribution, health, and even training of war workers. To assist 
 in the accomplishment of this task the Secretary of Labor ap- 
 pointed an advisory council which included representatives of 
 the War, Navy, and Agricultural Departments and the Ship- 
 ping Board. This interdepartmental arrangement tended to- 
 ward eliminating conflicts and questions of jurisdiction as well 
 as the duplication of machinery and effort in supplying war 
 industries with labor, and in their places established coopera- 
 tion. The object was to secure centralization and unification 
 of efforts on the part of employers, employes, and the public. 
 
 The program designed to meet the situation provided agen- 
 
 140
 
 THE FEDERAL DEPARTMENT OF LABOR 141 
 
 cies for the following purposes in addition to those of the 
 National War Labor Board : 
 
 For supplying houses for war workers, transportation, safe- 
 guarding conditions of living, and so on. 
 
 For safeguarding conditions of labor in the production of 
 war essentials, including protection in industrial hygiene, 
 safety, women and child labor, and so on. A special women 
 in industry bureau was created. 
 
 For furnishing an adequate and stable supply of labor to 
 war industries, including (i) a system of labor exchanges, (2) 
 a method and system of administration for the training of 
 workers, (3) an agency for determining priorities of labor 
 demand, and (4) agencies for the dilution of skilled labor. 
 
 For assembling and presenting information, collected through 
 various existing governmental agencies and by independent re- 
 search, necessary to effective executive action. 
 
 For developing public sentiment, securing an exchange of 
 information between departments of the labor administration, 
 and the promotion in industrial plants of local machinery help- 
 ful in accomplishing the national labor program. 
 
 For the correlation of all these and other governmental 
 agencies in order to secure team work, centralization of ad- 
 ministration, uniformity in policy, elimination of duplication 
 of effort, and so on. 
 
 All this was in addition to the regular work of the Depart- 
 ment of Labor which latter also was adapted where necessary 
 to meet the war demands and which included the Bureau of 
 Labor Statistics, the Bureau of Immigration, the Bureau of 
 Naturalization, the Children's Bureau, and the Bureau of 
 Mediation and Conciliation. 
 
 For the housing of war workers the Bureau of Housing and 
 Transportation was created within the department of Labor. 
 In order to meet the practical conditions confronting the actual 
 letting of contracts and the direction of the construction of 
 houses, the Bureau had incorporated by the State of New 
 York the United States Housing Corporation. Separate pro-
 
 142 THE WORKERS AT WAR 
 
 vision for the construction of houses for shipyard workers was 
 made by the Division of Housing and Transportation of the 
 Emergency Fleet Corporation, 
 
 To most people houses for workers to live in and the winning 
 of the war are unrelated facts but not to those who were made 
 familiar by the stress of war times with the actual conditions. 
 There is no one who will deny that buildings at cantonments 
 are a war essential, that uniforms and rifles and ammunition 
 are equally necessary, but there were few in the country at 
 the time who realized that houses for workers engaged in the 
 production of rifles and uniforms and shells were equally neces- 
 sary. The prosecution of every practical line of war endeavor 
 sooner or later, and quite often sooner than later, faced the 
 question of houses for war workers as the crucial problem that 
 had to be worked out in some way if production was not to be 
 seriously interfered with. An enormous labor turnover was 
 being reported by all war industries, the primary cause of 
 which was inadequate housing in the immediate vicinity of the 
 congested manufacturing centers coupled with an insufficiency 
 or total lack of transportation facilities between the places in 
 which the workers were employed and their homes. The loss 
 in production of materials essential to the Government's war 
 program was in consequence rapidly assuming alarming pro- 
 portions. Private house construction was virtually at a stand- 
 still due partly to difficulties in procuring materials and un- 
 certainty as to financial returns. 
 
 Evidence of this is in abundance in the testimony and re- 
 ports obtained by the committee on housing of the Council of 
 National Defense appointed in October, 1917, to investigate the 
 housing problem in connection with workers employed on 
 Government contracts and the relation of that problem to the 
 output of war materials. The committee found that with few 
 exceptions the Government contracts for guns, ammunition, 
 ships, and other war materials were being let with little or no 
 consideration of the housing needs incident to a rapid and large 
 increase of labor at those plants receiving the contracts. In
 
 THE FEDERAL DEPARTMENT OF LABOR 143 
 
 one New England manufacturing city, for illustration, sixteen 
 concerns were engaged upon war contracts needing ten thou- 
 sand additional men for whom there existed virtually no liv- 
 ing accommodations. At one steel plant, mainly employed 
 with Government contracts and with extensive additions to its 
 plant approaching completion, immediate provision for houses 
 was necessary if the production of guns, gun carriages, and 
 other munitions was not to be curtailed fully one-third of the 
 plant's possible output. 
 
 In the Norfolk, Virginia, district where $200,000,000 was 
 being expended on Government contracts, thirty-five thousand 
 new workers had exhausted as early as February, 1918, all 
 available housing facilities. The war production program for 
 that district called for an additional thirty-five thousand work- 
 ers to be brought in from other parts of the country but there 
 were no housing accommodations for them. Houses were also 
 badly needed at New Brunswick, New Jersey, for workers en- 
 gaged in aircraft production ; at Bath, Maine, for employes 
 constructing torpedo boat destroyers ; at Indian Head, Mary- 
 land, one of the Navy's proving grounds ; at Mare Island, 
 California, in the Government arsenal ; at the Philadelphia 
 Navy Yard ; at Bremerton, Washington ; and at a hundred and 
 more points of production widely scattered over the country. 
 In the National Capital it was found imperative that the Gov- 
 ernment through its Housing Corporation construct sixteen 
 dormitory-hotels for women war workers to assist in accom- 
 modating the more than fifty thousand additions to the cler- 
 ical positions in the various departments of the Government. 
 
 On May 16, 1918, President Wilson affixed his signature 
 to the housing act and in June the United States Housing 
 Corporation entered actively upon carrying to early completion 
 its extensive war housing program. The policy followed was 
 one under which the Government itself built, owned, and 
 rented all houses which the Housing Corporation through its 
 contractors constructed during the war. The appropriation 
 made available to the bureau exceeded $100,000,000, of which
 
 144 THE WORKERS AT WAR 
 
 $10,000,000 was specifically set aside for the needs of the 
 District of Columbia. Even with a sum of this magnitude it 
 was not possible for the National Government to assist every 
 community which was embarrassed by a housing shortage. 
 As a prerequisite to affirmative action upon their requests, the 
 bureau insisted upon certification by that branch of the War 
 or Navy Department whose contracts were most directly af- 
 fected. In cases the needs of the situation were met by the 
 bureau through improving or extending on Government loan 
 the transportation facilities in communities contiguous to the 
 manufacturing centers. Altogether at the signing of the Armis- 
 tice the Housing Corporation had in various stages of con- 
 struction eighty-seven separate housing projects in different 
 parts of the country. Of these, twenty-five were carried to 
 completion, work on all the others being discontinued shortly 
 after the Armistice. 
 
 Another new agency of the Department of Labor during the 
 war emergency was the Division of Women in Industry. This 
 was in recognition of the growing importance of the work of 
 women in industrial pursuits which necessitated a national 
 policy in determining the conditions of their employment. The 
 immediate task of the Division was to develop policies and 
 methods which would result in the most effective use of 
 women's services in production for the war, while at the same 
 time preventing their employment under injurious conditions. 
 It also confronted the task of coordinating work for women in 
 other departments of the Government as well as cooperating 
 with State departments of labor, working with and through 
 them, in order to bring about unity of action in the national 
 problems of women's work. It was a clearing house for 
 women labor for the entire country, not the least important 
 of its duties being the conservation of existing labor standards 
 and the establishing of additional standards whenever the con- 
 ditions required such action. 
 
 How necessary this was is indicated in the fact that the 
 unprecedented shortage of labor brought about by the military,
 
 THE FEDERAL DEPARTMENT OF LABOR 145 
 
 naval, and industrial demands of the Government, not only 
 for male soldiers and sailors but also for workers for the pro- 
 duction of war materials, naturally resulted in widespread re- 
 course to the substitution of the labor of women. In even 
 greater numbers than preceding the war they became clerks, 
 cashiers, and accountants in manufacturing-, mercantile, and 
 financial establishments, in the offices of transportation com- 
 panies, and other public utilities ; sales clerks and floor walkers 
 in mercantile establishments, including among others depart- 
 ment stores, specialty shops, shoe stores, men's furnishing 
 stores, florists' shops, jewelry stores, drug stores; street car 
 conductors, elevator attendants; waitresses, attendants at soda 
 water fountains, taxi drivers, chauffeurs, workers on the farms, 
 and so on. 
 
 More and more as the war progressed the Government itself 
 had to depend upon women to perform the tremendously in- 
 creased volume of work in the civil branches. The force of 
 civilian employes in the National Capital alone increased from 
 thirty thousand to approximately seventy thousand during the 
 first year of the war and of this increase more than twenty- 
 five thousand were women. The United States Civil Service 
 Commission was then calling for women for Government work 
 in as many as sixty different occupations, such as stenogra- 
 phers; typists; bookkeepers; clerks of a score and more clas- 
 sifications requiring training in some special or technical line; 
 statisticians ; operators of various kinds of calculating, address- 
 ing, and duplicating machines ; proof readers ; law clerks ; wel- 
 fare executive secretaries ; draftsmen ; telegraph and telephone 
 operators; trained nurses; chemists; physicists; library assis- 
 tants; inspectors of undergarments; finger-print classifiers; 
 employment managers ; and many others. Departmental heads 
 issued instructions to give preference to women employes in 
 filling vacancies as well as for new appointments to clerical 
 positions. Women became ship draftsmen in the navy yard 
 service and mechanical, marine, engine, and boiler draftsmen 
 in the Navy Department; passenger-rate, freight-rate, and ex-
 
 146 THE WORKERS AT WAR 
 
 press-rate clerks in the depot Quartermaster's offices of the 
 War Department ; schedule, store, index, and catalogue clerks 
 in the office of the Chief of Ordnance of the War Department ; 
 and negative cutters in the Geological Survey. 
 
 An analysis of thousands of calls for women labor on war 
 contracts shows the making of munitions, spinning, weaving, 
 knitting, sewing, and the conserving of food to be among the 
 more important demands. They were employed in the gas 
 mask plants as inspectors and throughout every step of the 
 entire process of manufacture, girls being trained in the special 
 art of sewing the face pieces. They worked in munitions es- 
 tablishments on drill presses, in making and marking fuses, 
 in loading the shells, in gauging machinery and shells, in as- 
 sembling artillery, and in inspection, drafting, electrical, and 
 carpentry work. 
 
 Naturally the conditions under which these women were em- 
 ployed was a matter of concern to the Government. Sugges- 
 tions as to employment, management, and health conditions 
 were made to manufacturers. Employments involving special 
 hazards, such as the use of industrial poisons, were to be 
 guided by the standards as to health, comfort, and safety set 
 up by the National Government and the State labor depart- 
 ments. The standards as to hours, night work, wages, and 
 general conditions of labor established by the Chief of Ord- 
 nance and the Quartermaster General * were adopted by the 
 Division of Women in Industry. 
 
 The enormous increase in the demand for workers in in- 
 dustrial pursuits of all kinds, coupled with the depletion of the 
 supply by the withdrawal of the nearly three million able 
 bodied men who were in the Army camps and Navy service 
 and the practical stoppage by the war of the annual immigra- 
 tion of one million aliens from Europe, brought about the 
 critical situation which forced the creation of the United States 
 Employment Service of the Department of Labor. Industries 
 with Government war contracts were short four hundred 
 
 1 See Chapter XII, pages 125 to 127.
 
 THE FEDERAL DEPARTMENT OF LABOR 147 
 
 thousand workers by June, 1918, and the railway and coal 
 mining industries were also being seriously handicapped by the 
 lack of men. In Connecticut and Maryland alone munition 
 plants needed thirty-five thousand skilled machinists. There 
 was no Government coordination between the letting of con- 
 tracts and the available labor supply in the vicinity of the plants 
 any more than we have seen consideration was given in the 
 letting of contracts to the housing supply for the workers. 
 There was in existence no machinery for gauging present and 
 future demands for labor by these war industries, or lor meas- 
 uring the relative importance of these demands as between in- 
 dustries, or for supplying the demands, or for determining be- 
 tween essential and less essential industries. There were no 
 means of preventing labor from leaving the farms where the 
 need was as great as that of the industries into which they 
 poured because of the high wages the competitive bidding of 
 contractors had brought about. 
 
 It is true there were in existence thousands of private em- 
 ployment agencies scattered throughout the principal cities of 
 the country but these soon broke down and their operation 
 was more harmful than otherwise because of their practices 
 and competitive methods. There were also State employment 
 agencies in some of the more important manufacturing States 
 but the problem of labor distribution that confronted them was 
 wholly beyond their antiquated machinery to meet the un- 
 precedented emergency. In the Department of Labor there 
 was also a Division of Information under the Bureau of Im- 
 migration but this was limited in its operation to incoming aliens 
 whose arrival had been stopped by the war. In brief, the 
 Government found itself confronted by an abnormal situation 
 for which no provision had been made. 
 
 Out of this necessity came the ofganization of the United 
 States Employment Service. So important was its establish- 
 ment deemed to be that President Wilson issued a statement 
 to the public under date of June 17, I9i8 v in which he said in 
 part: "There has been much confusion as to essential pr.o-
 
 148 THE WORKERS AT WAR 
 
 ducts. There has been ignorance of conditions men have 
 gone hundreds of miles in search of a job and wages which 
 they might have found at their doors. Employers holding 
 Government contracts of the highest importance have com- 
 peted for workers with holders of similar contracts, and even 
 with the Government itself, and have conducted expensive cam- 
 paigns for recruiting labor in sections where the supply of 
 labor was already exhausted. California draws its unskilled 
 labor from as far east as Buffalo, and New York from as far 
 west as the Mississippi. Thus labor has been induced to move 
 fruitlessly from one place to another, congesting the railways 
 and losing both time and money. Such a condition is unfair 
 alike to employer and employe, but most of all to the Nation 
 itself, whose existence is threatened by any decrease in its pro- 
 ductive power." 
 
 The obvious solution, said the President, was a central 
 agency acting as the voice of all the industrial agencies of the 
 Government and having sole direction of all recruiting of 
 civilian workers in war work, with power to assure to essential 
 industry an adequate supply of labor, even to the extent of 
 withdrawing workers from non-essential production. It 
 should also, he said, protect labor from insincere and thought- 
 less appeals made to it under the plea of patriotism, and assure 
 the worker that when he is asked to volunteer in some priority 
 industry the. need is real. The President urged all employers 
 engaged in war work to refrain after August I, 1918, from 
 recruiting unskilled labor in any manner except through this 
 central agency, and appealed to labor to respond " as loyally 
 as heretofore to any calls issued by this, agency for voluntary 
 enlistment in essential industry." 
 
 In carrying out this program the Employment Service was 
 organized as the national labor mobilization and distribution 
 machine, serving as a civilian recruiting agency for war work 
 in a somewhat similar way as the agencies recruiting for the 
 actual fighting branches of the Government. Partly because 
 of the unprecedented labor turnover, the Service confronted
 
 THE FEDERAL DEPARTMENT OF LABOR 149 
 
 the huge task of placing during 1918 millions of workers in 
 agriculture, shipbuilding, and the other war industries. The 
 plan of organization included the establishing of a network of" 
 seven hundred and fifty labor exchanges in virtually every im- 
 portant city in the United States. Five divisions handled the 
 details of its operations, these being the division of informa- 
 tion, of farm service, of women's work, of reserves, and of in- 
 vestigation. It functioned in cooperation with similar activ- 
 ities of bureaus of the various States. 
 
 Control was first undertaken of the recruitment and dis- 
 tribution of unskilled labor for war production. After Au- 
 gust i, 1918, no employer engaged wholly or partly in war 
 work whose maximum force exceeded one hundred workers, 
 either skilled or unskilled, was to secure unskilled labor ex- 
 cept through or under the direction of the Employment Service, 
 excepting railroads and farmers. Advertising of any kind for 
 unskilled labor, whether by card, poster, newspaper, handbill, 
 or other medium was prohibited to such employers. No re- 
 strictions were placed upon them in recruiting skilled labor 
 other than that they should avoid causing restlessness among 
 or employing men already engaged in other war work, includ- 
 ing railroads, farms, and coal mines, as well as work covered 
 by contract for Government departments. The Service op- 
 erated through its own officials and branch office employes, the 
 one hundred and fifteen State employment offices, the recruit- 
 ing agencies of the manufacturers, the fourth class post- 
 masters and rural carriers of the Post Office Department, the 
 " Four Minute Men '' of the Committee on Public Information, 
 and its own Public Service Reserve. 1 
 
 In an effort to speed up the Shipping Board's building pro- 
 gram the Service called upon the technical educational institu- 
 tions to organize every available young man between eighteen 
 
 1 A registration agency for patriotic citizens who desired to offer 
 their services to the Government either with or without compensation 
 and to work either directly in Government enterprises or in enterprises 
 engaged in service for the Government.
 
 150 THE WORKERS AT WAR 
 
 and twenty-one years of age to serve as apprentices in the ship- 
 yards in which wooden vessels were being constructed. It also 
 made an appeal to the presidents of more than six hundred 
 colleges and universities asking their help in mobilizing their 
 students on farms during the summer. To assist in farm work 
 there was also organized the Boys' Working Reserve for young 
 men between sixteen and twenty-one years of age who were to 
 give their spare time in productive enterprise without interrupt- 
 ing their studies at school. 1 Manufacturers were persuaded 
 to dispense with the services of a portion of their employes fo? 
 temporary periods of from one to four weeks to assist in the 
 cultivation of food crops. Steps were taken by the Commis- 
 sioner of Indian Affairs for determining the number of In- 
 dians on reservations who could be spared for farm and other 
 work in other localities and who could be induced to accept 
 employment at the prevailing wage. 
 
 Sections of the immigration law were suspended by the Sec- 
 retary of Labor so as to permit the importation of laborers 
 from Mexico during the period of the war to engage in agri- 
 cultural pursuits, in the maintenance of way on railroads, in 
 mining enterprises in which Mexican laborers had customarily 
 been employed, and in common labor work in connection with 
 Government construction in Texas, New Mexico, Arizona, and 
 southern California. These immigrants were exempted from 
 the payment of the head tax, the application of the literacy 
 test, and the enforcement of the contract-labor provision of 
 the immigration act. The Department of Labor also brought 
 in laborers from Porto Rico and the Virgin Islands for work 
 on Government contracts, on the railroads, and in agricultural 
 pursuits in the South and Southwest, the number it was planned 
 as early as January, 1918, to bring into the country exceeding 
 one hundred thousand. 
 
 Over the formulation of principles and policies and the es- 
 
 1 In New York State alone upwards of five thousand boys, located 
 in groups under leaders in camps, schoolhouses, barns, and the like, 
 were engaged at one time in farm work.
 
 THE FEDERAL DEPARTMENT OF LABOR 151 
 
 tablishing of practices and standards having to do with the 
 distribution of labor and the conditions of employment the War 
 Labor Policies Board was given jurisdiction. The functions of 
 this board were strictly administrative and are not to be con- 
 fused, as they were quite frequently in the public mind, with 
 those of the National War Labor Board. The Policies Board 
 assisted in correlating and unifying the operation of the various 
 Government departments on industrial matters in the practice 
 of which it was agreed there should be uniformity of action. 
 It was concerned primarily with such questions as standard- 
 ization of labor and in particular of wages in Government 
 plants and those on war contracts ; the providing, distributing, 
 and maintaining of a stable and adequate supply of workers ; 
 labor dilution and training ; priority demands for labor ; and the 
 safeguarding of employment, living, and housing conditions for 
 workers engaged in war work.
 
 CHAPTER XV 
 
 THE GOVERNMENT, WAGES, AND THE COST OF LIVING 
 
 / ~T~*HE task set the National Government by the war 
 * emergency in the control and direction of the economic 
 forces affecting industrial production by the workers was as 
 great and as unprecedented as was the military task of winning 
 the war. Production of commodities and of services under 
 this emergency meant as complete and as revolutionary changes 
 in habits, in processes, and in practices of industry as did the 
 conduct of the war in its effect upon established principles of 
 military operations. The United States Government was no 
 more prepared for this nationalization of production than it 
 was for a war in a foreign country of the magnitude which the 
 European conflict assumed. It was compelled to undertake the 
 impossible ; it, of course, fell short of that accomplishment. 
 But the results in the one case as in the other do not so much 
 justify criticism of the Government and its agencies for the 
 efforts that failed as they justify praise for those other efforts 
 that succeeded. And among these efforts deserving of com- 
 mendation is the Government's adoption and enforcement of a 
 policy as to wages which emphasized their social rather than 
 their economic aspects. 
 
 Compensation to the men in the service of the Army and 
 Navy was determined by law and had no essential relation to 
 the tasks they were to be called upon to perform. In both 
 these branches of war service the Government supplied the 
 men with food, clothing, and shelter in addition to their stipu- 
 lated monthly pay. But to the millions of citizens voluntarily 
 enlisted in the war industries of the Government the question 
 
 152
 
 WAGES AND THE COST OF LIVING 153 
 
 of wages was quite a different problem. These workers had 
 to meet all their living expenses and the cost of these was 
 constantly and rapidly increasing. What was to be the method 
 of determining fair wages, for the Government, of course, as 
 employer would not want to pay other than fair wages to the 
 workers ? 
 
 The answer the Government made to this question was vir- 
 tually as follows : " We know the industrial workers of the 
 country in all trades and occupations have for years been striv- 
 ing and struggling to increase their money wages. We know 
 they claim the present wage basis to be unfair and unjust. 
 The Government cannot be expected, however, under the 
 emergency circumstances of war, to pass judgment upon the 
 justice or injustice of present wages. But the Government 
 does intend to do this : Accepting the present wage basis, there 
 shall be increases periodically to correspond with the increase 
 in the cost of living to the workers. That is, as the cost of 
 food, clothing, and shelter, and so on increases, wages will be 
 increased." 
 
 This policy was reflected in the action of every Government 
 agency having to do with the wages of war workers. For il- 
 lustration, one of the first of these agencies to take action was 
 the Railroad Wage Commission. In its report to the Director 
 General of the Railroad Administration it stated that the 
 standards it sought to meet were the right thing " at this time," 
 a measure of justice, and consideration for the needs of the 
 men, whether organized or unorganized, whether replaceable or 
 not replaceable. To the mind of the commission the object 
 sought was qualified materially by the phrase " at this time." 
 The existing state of war, it believed, prohibited anything ap- 
 proximating a determination of ideal conditions. The question 
 which it formulated and for which it sought an answer was 
 this : " By what amount have the railroad workers been disad- 
 vantaged by reason of the war, and how may that disadvantage 
 be overcome with the largest degree of equity ? " 
 
 The way the commission met the situation was as follows :
 
 154 THE WORKERS AT WAR 
 
 " We have had a most exhaustive study made of the cost 
 of living today as contrasted with the cost of living for the 
 latter part of 1915, when by the reaction of the European war 
 the American people first felt keenly the increase in the bur- 
 dens of life and the need for higher wages. This study has 
 been made without reference primarily to those quite thorough 
 investigations which have been carried on by the Department of 
 Labor and other governmental and many private agencies. And 
 to our minds it conclusively establishes two things : ( I ) That the 
 cost of living has increased disproportionately among those of 
 small incomes, and (2) that there is a point up to which it is 
 essential that the full increased cost shall be allowed as a wage 
 increase, while from this point on the increase may be gradually 
 diminished. 
 
 " This study of the cost of living was not made from paper- 
 statistics exclusively, by the gathering of prices and compari- 
 sons of theoretical budgets. It was in no inconsiderable part 
 an actual study from life, one of the most interesting and valu- 
 able groups of figures having been gathered by the newspapers 
 of the country, by interviews with those of the working class, 
 and the inspection of their simple books of accounts. Roughly, 
 it may be said that the man who received eighty-five dollars a 
 month on January I, 1916, now needs 40 per cent, additional 
 to his wage to give him the same living that he had then. Be- 
 low that wage a larger percentage must be allowed because the 
 opportunity for substitution and other methods of thrift de- 
 cline almost to a vanishing point, for above that wage a growing 
 proportion of the increase will go to those things essential to 
 cultured life, but non-essential to actual living. In fairness, 
 therefore, a sufficient increase should be given to maintain that 
 standard of living which had obtained in the prewar period, 
 when confessedly prices and wages were both low." i 
 
 This, then, was the goal aimed at by all the Government 
 Departments and agencies having control directly and indi- 
 rectly over wages. For this purpose they depended for their 
 measurement of the increase in the cost of living upon the 
 report of the Bureau of Labor Statistics of the Department of 
 Labor. This report dealt principally with the prices of food 
 products, although occasionally special reports were issued 
 
 1 Report of the Railroad Wage Commission to the Director General.
 
 WAGES AND THE COST OF LIVING 155 
 
 treating of increases in the price of clothing, fuel and lighting, 
 and rent. For its prices of foods the Bureau depended upon 
 reports from selected and dependable retail dealers in fifty 
 cities in different parts of the country giving quotations on 
 similar grades of commodities that would permit of fairly ac- 
 curate comparisons over stated periods of time. These com- 
 modities were weighted in relation to each other according to 
 their importance in the consumption of the average working- 
 man's family. Twenty-two of the most essential foods are sir- 
 loin steal, round steak, rib roast, chuck roast, plate beef, pork 
 chops, bacon, ham, lard, hens, flour, corn meal, eggs, butter, 
 milk, bread, potatoes, sugar, cheese, rice, coffee, and tea. 
 
 For the six-year period from November, 1913, to November, 
 1919, the increase in the prices of these twenty-two articles 
 combined was 92 per cent. Articles which more than doubled 
 in price, that is increased more than 100 per cent., were sugar, 
 131 per cent; lard, 129 per cent; flour 124 per cent. ; corn 
 meal, 113 per cent.; potatoes, 105 per cent.; bread, 104 per 
 cent.; and rice 102 per cent. 1 By November, 1917, at the time 
 of the signing of the Armistice by Germany, the increase in the 
 price of all twenty-two articles had reached 60 per cent., and 
 by November a year later 84 per cent., above the 1913 average. 
 This percentage increase in food prices at any particular time 
 applied to the existing wages in relation to their 1913 basis 
 indicated the per cent, increase in wages necessary for the 
 workingman to keep abreast of the increase in the cost of liv- 
 ing. This was the principal on which the Government agencies 
 operated during the war in granting increases in wages to 
 its war workers other than those in the strictly military service 
 of the Army and Navy. 
 
 Food, of course, is not the only, although it is the most im- 
 portant, factor entering into the workingman's cost of living. 
 For illustration, reports of the Bureau of Labor Statistics show 
 the following increases in other elements in the cost of living 
 to workers in the New York shipbuilding district from the 
 
 1 Monthly Labor Review, Vol. X, No. i, January, 1920.
 
 156 THE WORKERS AT WAR 
 
 beginning of the European war up to December, 1917: Men's 
 clothing, 51 per cent. ; women's clothing, 52 per cent.; furniture 
 and furnishing, 56 per cent. ; housing 2.6 per cent. ; fuel and 
 light, 20 per cent. ; miscellaneous items, 45 per cent. Of ex- 
 penditures of the average family 45 per cent, go to pay for 
 food, 13 per cent, for housing in the form of rent, and 20 
 per cent, for fuel and light. The average expenditure of each 
 608 families of these shipyard workers was found to be 
 $1,348.64 during 1917. 
 
 Such a principle for determining wage increases is not, of 
 course, ideal and is not to be commended as a proper basis for 
 wage increases under peace time conditions. As a war 
 emergency it was probably the best that could have been 
 adopted. But it errs fundamentally in that it operates rigidly 
 to keep the workers' standard of living at a standstill it 
 makes no provision for the necessary increase in that standard. 
 Even more than this, it actually operates to lower the standard 
 in that the increase in wages to the worker comes at the end 
 and not at the beginning of the period of price increases and 
 does not compensate him for the difference, measured by the 
 increase, which he has had to pay in the meantime, unless the 
 award is made to apply retroactively to the time when the 
 price increases started. An exception to the statement as to a 
 decreasing standard of living is found, of course, in those 
 cases where the cost of living decreases and wages continue 
 the same, but this was not the economic tendency during the 
 war period. An even stronger objection to the cost of living 
 principle as applied to wage increases is to be found in the 
 fact that the wage basis taken as the standard may not, and 
 usually does not, represent a just standard of living to the 
 worker. Most assuredly the low pre-war basis of wages is 
 not by any means representative of that standard of living of 
 the American workingman which is essential to his status as a 
 citizen of a democracy! 
 
 The Government having determined upon the policy that the 
 wages of war workers in industries should be increased during
 
 WAGES AND THE COST OF LIVING 157 
 
 the period of the war in such proportion as was made neces- 
 sary by the increase in the cost of living, the question naturally 
 arose as to who or what class or group in society was to meet 
 these increases in wages. The increases could come from one 
 or both of two sources from a decrease in the profits of the 
 manufacturers and producers or from an increase in prices to 
 the consumers. 
 
 " It is obvious that these advances in wages must be taken 
 either from the operator or the consumer," x says the Fuel Ad- 
 ministrator, in a letter to President Wilson under date of Oc- 
 tober 6, 1917, in which he approves of wage increases of 50 
 per cent, to bituminous coal miners and 78 per cent, to mine 
 laborers. It was his understanding, he said, that in fixing 
 provisional prices by the Government for the sale of coal, it 
 was intended to allow a fair profit to the operators. " On the 
 assumption that the prices fixed yielded a fair profit to the op- 
 erator," continued the statement, " it is clear that if this in- 
 crease of wages is to fall entirely upon the operators, their 
 profits will no longer be fair, unless the result of the increase 
 bears an insignificant relation to these profits. This question 
 was submitted to me as Fuel Administrator. It is not pos- 
 sible to estimate the exact effect of the proposed increases 
 upon the prices fixed. But the experts of the Federal Trade 
 Commission and of the Fuel Administration have made as 
 careful computation as the data in hand permit. I have asked 
 
 1 The increase could have been taken partly from the operator and 
 partly from the consumer, and in such a policy there would have 
 been a greater degree of economic justice as between the wage earner, 
 the capitalistic producer, and the consumer, in that, as already stated, 
 the wage worker was not wholly compensated for the increase in the 
 cost of living through his wages being increased only after he had 
 borne for a time the increased cost of living. The producer could 
 have been made to bear his proper proportion by increasing the price 
 of his commodity somewhat less than the whole of the wage increase, 
 and this would automatically have transferred to the consumer his 
 proper proportion of the economic burden. Instead, the effect of the 
 Government's policy was to transfer to the consumer an undue pro- 
 portion of the inescapable increase in the cost of living.
 
 158 THE WORKERS AT AVAR 
 
 these gentlemen to exclude from their computations any al- 
 lowance which could properly be regarded as an indirect 
 increase of the profits of the operators, and to make their 
 calculations with the sole object in view of covering the in- 
 crease in wages by interpreting the above proposals in terms of 
 the prices fixed by you, that is to say, to advise me how many 
 cents per ton on coal produced the proposed wage increases 
 mean." 
 
 The supplemental agreement of November 17, 1917, be- 
 tween the anthracite operators and mine workers covering 
 wages and working conditions in the anthracite fields of Penn- 
 sylvania, approved by the Fuel Administration, contained a 
 clause to the effect that the increase in wages agreed to " would 
 become effective only on condition that the selling price of 
 coal would be advanced by the United States Government suf- 
 ficient to cover the increased cost of production," and the agree- 
 ment was not to take effect " until the first day of the pay 
 period following the order granting such increased price." 
 Under these conditions the agreement was to be effective dur- 
 ing the period of the war or until March 31, 1920, in case the 
 war was not terminated before that time. Under date of No- 
 vember 28, 1917, the President in an Executive Order in- 
 creased the selling price of anthracite by the addition of thirty- 
 five cents to each of the prices prescribed and adjusted by him 
 for anthracite at the mines under date of August 23, 1917, and 
 adjusted as to pea coal October I, 1917. This price increase 
 was the amount the Fuel Administrator had determined was 
 necessary to meet the increase in wages. 
 
 The act approved August 10, 1917, provided among other 
 things as follows : " That, by reason of the existence of a 
 state of war, it is essential to the national security and defense, 
 for the successful prosecution of the war and for the support 
 and maintenance of the Army and Navy, to assure an adequate 
 supply and equitable distribution and to facilitate the move- 
 ment of foods, feeds, fuel, including fuel oil and natural gas, 
 and fertilizer and fertilizer ingredients, tools, utensils, imple-
 
 WAGES AND THE COST OF LIVING 159, 
 
 ments, machinery, and equipment required for the actual pro- 
 duction of foods, feeds, and fuel, hereafter in this act called 
 necessaries ; to prevent, locally or generally, scarcity, monopo- 
 lization, hoarding, injurious speculation, manipulation, and 
 private controls affecting such supply, distribution, and move- 
 ment ; and to establish and maintain governmental control of 
 such necessaries during the war. For such purposes the in- 
 strumentalities, means, methods, powers, authorities, duties, ob- 
 ligations, and prohibitions hereinafter set forth are created, es- 
 tablished, conferred, and prescribed. The President is author- 
 ized to make such regulations and to issue such orders as are 
 essential effectively to carry out the provisions of this act." 
 
 Under the price fixing authority thus conferred on the Presi- 
 dent by Congress the various Departments of the Government 
 operated on the principle of increasing prices of manufac- 
 turers and producers equal to the wage increases they were 
 called upon to meet by the enforcement of the Government 
 policy of advancing wages proportionately to the increase in the 
 cost of living. In determining the " just, reasonable, and fair 
 profit ".for articles under the control of the Food Administra- 
 tion, for illustration, President Wilson issued an Executive 
 Order under date of November 27, 1917, authorizing and di- 
 recting the United States Food Administrator, in prescribing 
 regulations for licenses, to establish as a basis " the normal 
 average profit which persons engaged in the same business and 
 place obtained prior to July I, 1914, under free competitive 
 conditions." The order also directed the Food Administrator 
 to " indicate, if he shall see fit to do so, what margin over cost 
 will return such a just, reasonable, and fair profit; to take 
 such legal steps as are authorized by said act l to prohibit the 
 taking of any greater profit." 
 
 These licenses were prescribed for manufacturers, whole- 
 salers, and other distributors of staple food products, includ- 
 ing also importers, packers, canners, commission men, brokers, 
 auctioneers, storage warehousemen, and retailers doing an an- 
 
 1 Act of Congress approved August 10, 1917.
 
 160 THE WORKERS AT WAR 
 
 
 
 nual business in excess of $100,000. The smaller retailers were 
 not placed under license but were subject to the provisions of 
 the food law forbidding speculation, hoarding, and excessive 
 profits and were also controlled indirectly through the licens- 
 ing regulations governing wholesalers who were obligated to 
 cut off all supplies to dealers who exacted exorbitant profits on 
 the necessities of life. The licensed foods included beef, pork, 
 mutton, fish, poultry, eggs, milk, butter, cheese, flour, sugar, 
 cereals, lard, beans, peas, fruits, vegetables, several lines of 
 canned goods, and other products. The penalty for operating 
 without a license was a fine of five thousand dollars or two 
 years' imprisonment. 
 
 The purposes of licensing were to encourage production, con- 
 serve supplies, and control the distribution of food products 
 and fuel. These ends it was hoped would be accomplished by 
 limiting the prices charged to a reasonable amount over ex- 
 penses thus preventing speculative profits from a rising market, 
 assisting the movement of all food commodities in a direct line 
 from producer to consumer without delay, and keeping at a 
 minimum the number of contracts for future delivery as well 
 as dealings in future contracts. 
 
 By Presidential proclamation signed May 14, 1918, all in- 
 dividuals, partnerships, associations, and corporations, except 
 those specifically exempted by the food control act, engaged in 
 the importation, manufacture, storage, and distribution of tools, 
 utensils, implements, machinery, and certain other farm equip- 
 ment, were required to secure Federal licenses not later than 
 June 20, 1918. In this way these dealers also were brought un- 
 der Government control, inspection, and regulation as to profits, 
 resales within the trade, attempts to monopolize, unreasonable 
 increases of prices or restrictions of supplies, and willful waste 
 of farm equipment. 
 
 Thus is indicated briefly the devices the Government had re- 
 course to in order to control prices. That there was profiteer- 
 ing in spite of this Government policy cannot be denied but it 
 is unquestionably also true that this profiteering was con-
 
 WAGES AND THE COST OF LIVING 161 
 
 siderably less than it would have been if the Government had 
 not exercised such control. In its absence the unorganized, 
 and for this reason defenceless, American consumer would 
 have experienced the barbarous and disastrous effects upon his 
 economic status of the manipulation of the law of supply and 
 demand in the hands of those whose sole object is the maximum 
 profit. Manufacturers generally would have taken advantage 
 of the situation and there would have been a national orgy in 
 a race among them to see which could pile up the greatest 
 amount of profits. In a seller's market they would have de- 
 manded " all the traffic will bear " would have exacted " the 
 pound of flesh." 
 
 Even as it was the public consequences are proving far- 
 reaching in their effects. Through the policy of the Govern- 
 ment permitting increases in prices to manufacturers and pro- 
 ducers equal to the increases in wages granted to meet the 
 increase in cost of living, there was transferred to virtually 
 all commodities increases in prices at least equal to the in- 
 crease in cost of living as measured by food products. This in 
 turn brought still greater pressure on the wage worker for he, 
 too, is a consumer of these other commodities. And in this 
 dual relation of the worker lies all the perplexities of the 
 economic tendencies that have been characterized as " The 
 Vicious Cycle."
 
 CHAPTER XVI 
 
 THE VICIOUS CYCLE AND THE LABOR UNION 
 
 THE economics of increasing wages in proportion to the 
 increase in the cost of living, as measured by the in- 
 crease in food prices, and in turn of increasing prices of other 
 commodities in proportion to these wage increases operated in- 
 evitably to produce " The Vicious Cycle " which has come to 
 plague the Wilson Administration and the American people. 
 This is evidenced by the predicament in which the Government 
 found itself, following the Armistice, in consequence of 'the 
 demands for higher wages of industrial workers in all lines 
 of activity, and in particular of the organized railway em- 
 ployes, who were working directly for the Railroad Adminis- 
 tration of the United States Government, and of the coal mine 
 workers which resulted in the strike of November-Decem- 
 ber, 1919. 
 
 Those employed in railroad shops, including mechanics of 
 all kinds such as toolmakers, bbilermakers, riveters, black- 
 smiths, sheet metal workers, electricians, inspectors', car re- 
 pairers, and helpers, had repeatedly made requests for increases 
 in their wages to meet the increase in the cost of living, their 
 specific demands being for a standardized hourly rate of eighty- 
 five cents. Their wages at the time varied between fifty- 
 eight and sixty-eight cents an hour. These requests had 
 passed through all the stages already described 1 as having been 
 provided for by the Railroad Administration for the settlement 
 of labor disputes, even to the extent of involving a proposal to 
 create an entirely new tribunal, and in August, 1919, had 
 reached the Director-General and the President of the United 
 
 1 Chapter IX. 
 
 162
 
 THE VICIOUS CYCLE 163 
 
 States without a settlement and with the shopmen voting by 
 ballot to go out on strike on September 2 to enforce their de- 
 mands. Sporadic strikes, unauthorized by the national of- 
 ficers of the unions, had already taken place in various shops 
 on different railroads. Other railway organizations, particu- 
 larly the four brotherhoods whose members were engaged in 
 the operation of trains, were also pressing their demands for 
 wage increases. So serious, indeed, had the situation become 
 that President Wilson on August 25, 1919, issued an appeal to 
 the railway workers and a statement to the public. 
 
 In this appeal the President stressed the patriotism of the 
 railway workers and stated that the primary step for recon- 
 struction was to increase production and facilitate transporta- 
 tion, " so as to make up for the destruction wrought by the 
 war, the terrible scarcities it created, and so as soon as possible 
 relieve our people of the cruel burden of high prices." " The 
 railways," he said, " are at the centre of this whole process." 
 The appeal explained that the Government was approaching 
 the conditions with the object of reducing the cost of living 
 rather than, as during the war, of increasing wages so as to 
 meet the increase in the cost of living. On this point the 
 appeal said : " The Government has taken up with all its 
 energy the task of bringing the profiteer to book, making the 
 stocks of necessaries in the country available at lowered prices, 
 stimulating production, and facilitating distribution, and very 
 favorable results are already beginning to appear. There is 
 reason to entertain the confident hope that substantial relief 
 will result, and result in increasing measure. A general in- 
 crease in the level of wages would check and might defeat all 
 this at its very beginning. Such increases would inevitably 
 raise, not lower, the cost of living. Manufacturers and pro- 
 ducers of every sort would have innumerable additional pre- 
 texts for increasing profits and all efforts to discover and defeat 
 profiteering l would be hopelessly confused. I believe that the 
 
 1 The Federal Trade Commission had reported on profiteering to the 
 President as early as June, 1918. This was in response to the direc-
 
 164 THE WORKERS AT WAR 
 
 present efforts to reduce the cost of living will be successful 
 if no new elements of difficulty are thrown in the way, and I 
 confidently count upon the men engaged in the service of the 
 railways to assist, not obstruct. It is much more in their in- 
 terest to do this than to insist upon wage increases which will 
 undo everything the Government attempts." 
 
 The President added that if the efforts of the Government to 
 bring the cost of living down should fail, after it had had time 
 enough to establish either success or failure, " it will, of course, 
 be necessary to accept the higher costs of living as a per- 
 manent basis of adjustment, and railway wages should be 
 readjusted along with the rest. All that I am now urging is 
 that we should not be guilty of the inexcusable inconsistency of 
 making general increases in wages on the assumption that the 
 present cost of living will be permanent at the very time that 
 we are trying with great confidence to reduce the cost of living, 
 and are able to say that it is actually beginning to fall." 
 
 In the statement to the public the President, among other 
 things, said that while the increase in cost of living argument 
 of the railway shopmen was indeed a potent one, their de- 
 mands for increased wages, and all similar demands, were in 
 effect this : " That we make increases in wages, which are 
 likely to be permanent, in order to meet a temporary situation 
 which will last nobody can certainly tell how long, but in all 
 probability only for a limited time. Increases in wages will, 
 
 tion under Senate resolution No. 255 that the Commission furnish the 
 Senate with any and all facts, figures, data, or information in its posses- 
 sion relative to profiteering which would in any way enable Congress 
 to deal with the matter. In substance the Commission reported that 
 the outstanding revelations were the heavy profit made by the low- 
 cost concerns under a governmental fixed price for the whole coun- 
 try, by the meat packers and those allied with them, and by the flour 
 millers, and the trade tendency to increase and maintain prices against 
 the forces of competition. The Commission stated that it had reason 
 to know that profiteering existed and that much of it was due to ad- 
 vantages taken of the necessities of the times, as evidenced in the war 
 pressure for heavy production, and some of it to inordinate greed and 
 bare-faced fraud.
 
 THE VICIOUS CYCLE 165 
 
 moreover, certainly result in still further increasing the costs 
 of production and, therefore, the cost of living, and we should 
 only have to go through the same process again. Any sub- 
 stantial increase of wages in leading lines of industry at this 
 time would utterly crush the general campaign which the Gov- 
 ernment is waging, with energy, with vigor, and substantial 
 hope of success, to reduce the high cost of living. And the in- 
 creases in the cost of transportation which would necessarily 
 result from increases in the wages of railway employes would 
 more certainly and more immediately have that effect than any 
 other enhanced wage costs. Only by keeping the cost of pro- 
 duction on its present level, by increasing production and by 
 rigid economy and saving on the part of the people can we 
 hope for large decreases in the burdensome cost of living which 
 now weighs us down." 
 
 The fact that the railroads of the country were under direct 
 Government control with an annual guaranteed return to the 
 transportation corporations gave to the proposed wage in- 
 creases not the ordinary aspect of possible effects upon the bal- 
 ance sheets of these corporations but that of determining the 
 burden of taxation which must fall upon the people to the ex- 
 tent of such increases. " For it is neither wise nor feasible," 
 said the President, " to take care of increases in the wages of 
 railroad employes at this time by increases in freight rates. 
 It is impossible at this time, until peace has come and normal 
 conditions are restored, to estimate what the earning capacity 
 of the railroads will be when ordinary conditions return. 
 There is no certain basis, therefore, for calculating what the 
 increases of freight rates should be, and it is necessary, for the 
 time being at any rate, to take care of all increases in the wages 
 of railroad employes through appropriations from the public 
 treasury. In such circumstances, it seems clear to me, and I 
 believe will seem clear to every thoughtful American, includ- 
 ing the shopmen themselves when they have taken second 
 thought, and to all wage earners of every kind, that we ought to 
 postpone questions of this sort till normal conditions come
 
 166 THE WORKERS AT WAR 
 
 again and we have the opportunity for certain calculation as 
 to the relation between wages and the cost of living." 
 
 To the President's appeal the officials of the railway em- 
 ployes' unions accorded compliance and again exhibited pa- 
 tience under aggravating circumstances. But in April. 1920, 
 this patience of the rank and file broke under the economic 
 pressure of even higher prices and resulted in a widespread 
 two weeks' " outlaw " strike of members of these unions, so- 
 called because they left their places of employment in disobe- 
 dience of the instructions of their national officers. In the 
 case of the coal mine workers the trend of events was quite 
 different. 
 
 At the first convention of the United Mine Workers of 
 America following the signing of the Armistice, held at Cleve- 
 land, Ohio, in September, 1919, this supreme authority of the 
 mine employes adopted a resolution to the effect that the 
 agreement then existing between the workers and the operators, 
 now that the war was over, automatically expired, and that 
 new contracts should be entered into not later than November 
 i, 1919. It formulated and expressed the principles that 
 should govern its representatives in making a new agreement, 
 these principles being a 60 per cent, increase in wages and the 
 adoption of a six hour day and a five day week. This work- 
 ing time was not intended to reduce the number of working 
 hours but on the contrary was designed to spread them more 
 evenly throughout the year, the seasonal conditions of em- 
 ployment in the industry being such as to deprive the men 
 of all work during certain months of the year. The mines on 
 the average supplied work for not more than 225 days in the 
 year and during those working days the miners must earn 
 enough to support themselves and their families for the entire 
 365 days. At this convention there were nearly twenty-two 
 hundred delegates from local unions in all the twenty-eight coal 
 producing States, this being the largest attended convention in 
 the history of the United Mine Workers. These delegates 
 represented a paid up membership in the organization of 434,-
 
 THE VICIOUS CYCLE 167 
 
 967; in their national treasury alone there was a fund of 
 $1,728,000. 
 
 Reference has already been made l to the joint bargaining 
 machinery existing between the miners and operators for the 
 settlement of their differences as to wages and conditions of 
 employment which, after the progress of more than a quarter 
 of a century, had reached a high state of development, prob- 
 ably equal to that attained by the joint agreement between the 
 railway train employes and the transportation corporations. 
 This trade agreement machinery had operated to protect and 
 advance the economic and social welfare of the coal miners 
 of the country; it had also proven beneficial in many ways to 
 the operators. Following the Cleveland convention, several 
 months of " bargaining " in conferences with representatives 
 of the operators failed, as was usually the case, to bring about 
 an agreement between the two sides as to the provisions of a 
 new contract. The best offer the operators would make was 
 a 20 per cent, increase in wages. Finally, when it was evi- 
 dent that the joint bargaining machinery was in a deadlock 
 and that progress in negotiations had become clogged thereby, 
 the Secretary of Labor, under the provisions of the law em- 
 powering him to act as a conciliator, called representatives of 
 the two parties into conference in Washington. This was in 
 October, 1919. He suggested as a basis for settlement an in- 
 crease in wages to mine employes of 31.6 per cent. This figure 
 he arrived at by computing the increase in the cost of living 
 after allowing for the increases in wages that had already been 
 granted to mine workers. 
 
 At this point in the proceedings the Fuel Administration, 
 which had been devised as a war emergency organism of the 
 National Government but which had virtually ceased to func- 
 tion following the Armistice, was injected into the controversy. 
 Through Fuel Administrator Harry A. Garfield, President of 
 Williams College, opposition was made to the 31.6 per cent, 
 proposal and insistence was placed instead upon an increase of 
 
 i Chapter XL
 
 168 THE WORKERS AT WAR 
 
 only 14 per cent., the claim being advanced to support it that 
 such an increase would enable the wages of the mine em- 
 ployes to keep pace with the increase in the cost of living. 
 There followed differences of opinion between these depart- 
 ments of the Government which were thrashed out in Cabinet 
 meetings. Unfortunately for the best interests of the public, 
 President Wilson was still indisposed as the result of his physi- 
 cal breakdown on his tour of the country in behalf of the 
 League of Nations. The Fuel Administration contended be- 
 fore the Cabinet that the question of wage increase to mine 
 workers was within its jurisdiction and not that of the Depart- 
 ment of Labor, inasmuch as the Administration had been en- 
 trusted by law with authority over coal prices and any change 
 in wages to mine employes would naturally affect these prices. 
 It opposed any increase in wages that meant an increase in the 
 price of coal and maintained that a 14 per cent, increase in 
 wages could be granted without increasing coal prices, this 
 amount of increase to be absorbed from the profits of the 
 operators. It expressed its belief that this would result in 
 reasonable wages to the mine workers and a reasonable profit 
 to the operators. 
 
 The Cabinet decided in favor of the Fuel Administration. 
 The public by this time had got the impression that somebody 
 on the part of the Government was muddling the whole affair, 
 as the operators themselves had offered a 20 per cent, increase. 
 The settlement proposed by the Fuel Administration and fin- 
 ally adopted by the Cabinet embodied the appointment by the 
 President of a permanent consultative commission with purely 
 advisory powers to examine wages and other coal mining data 
 and announce conclusions but without authority to enforce its 
 rulings upon either party to the controversy. 
 
 The representatives of the mine workers refused to accept 
 the 14 per cent, increase in wages as a basis for a contract with 
 the operators and in compliance with instructions of the con- 
 vention which formulated the demands, they ordered on Oc- 
 tober 16 a strike of all soft coal mine workers, effective No-
 
 THE VICIOUS CYCLE 169 
 
 vember I. Those into whose hands fell temporarily the con- 
 duct of the Administration during the indisposition of Presi- 
 dent Wilson issued " a statement by the President " on Oc- 
 tober 25 reiterating commonplace sentences as to the public 
 consequences of such a strike and urging the miners to con- 
 tinue at work "until a treasonable opportunity has been af- 
 forded for dealing with the cost of living." It characterized 
 the proposed suspension of mining operations as being " not 
 only unjustifiable, it is unlawful"; "a grave moral and legal 
 wrong " ; " a fundamental attack, which is wrong both morally 
 and legally, upon the rights of society and upon the welfare of 
 our country." In the statement both the national and local 
 officers of the United Mine Workers were requested " to recall 
 all orders looking to a strike on November I, and to take what- 
 ever steps may be necessary to prevent any stoppage of work." 
 
 To this statement the officials of the miners' union replied to 
 the effect that a strike of bituminous miners could not be 
 avoided. " A regularly constituted convention of representa- 
 tives of United Mine Workers," said the statement of the min- 
 ers' officials, " ordered a strike of bituminous mine workers to 
 become effective November I in the event a wage scale was 
 not negotiated before that time. The highest authority of the 
 organization has acted in this manner, and no representatives of 
 the organization have authority to set such action aside. The 
 facts are that the same supreme authority which ordered the 
 pending strike is the same as that which approved the contract 
 which has now expired. 
 
 " The fundamental causes which prompted the mine workers 
 to take this drastic action are deep seated. For two years their 
 wages have remained stationary. They appealed one year ago 
 to the Federal Fuel Administrator, Dr. Garfield, and from 
 him to the President of the United States, for an increase in 
 wages sufficient to meet the increase in the cost of the neces- 
 saries of life. Their appeal was rejected and their request 
 refused. Notwithstanding this, they continued mining coal 
 until now their contract expires, when they are determined
 
 170 THE WORKERS AT WAR 
 
 that their grievances must be adjusted in a reasonably satis- 
 factory manner. 
 
 " The courts have held that the workingmen have a right 
 to strike and may quit work either singly or collectively for the 
 purpose of redressing grievances and righting wrongs. The 
 Constitution and the guarantees of this free government give 
 men the right to work or quit work individually or collectively. 
 The mine workers, therefore, are but exercising the right 
 guaranteed by the Constitution and which cannot be taken 
 away by the representatives of government when they quit work 
 or when they refuse to work until their grievances are 
 adjusted." 
 
 The attitude of the Government as represented by the De- 
 partment of Justice was explained in a public statement by the 
 newly appointed Attorney General. It had the effect of plac- 
 ing the Government in the position of the operators as op- 
 ponents of the mine workers. This statement among other 
 things said: 
 
 " The proposed strike was ordered in a manner, for a pur- 
 pose and with a necessary effect, which taken together put it 
 outside the pale of the law. ... By enacting the food and 
 fuel control act Congress has recognized the vital importance 
 in the present circumstances of maintaining production and 
 distribution of the necessaries of life, and has made it unlawful 
 for any concerted action, agreement or arrangement to be 
 made by two or more persons to limit the facilities of trans- 
 portation and production, or to restrict the supply and distribu- 
 tion of fuel, or to aid or abet the doing of any act having this 
 purpose or effect. Making a strike effective under the cir- 
 cumstances which I have described amounts to such concerted 
 action or arrangement. 
 
 " It is the solemn duty of the Department of Justice to en- 
 force this statute. We have enforced it in many cases. We 
 must continue to do so irrespective of the persons involved in 
 its violation. . . . The facts present a situation which chal- 
 lenges the supremacy of the law, and every resource of the
 
 THE VICIOUS CYCLE 171 
 
 Government Avill be brought to bear to prevent the national 
 disaster which would inevitably result from the cessation of 
 mining operations." 
 
 In carrying out this policy the Department of Justice on No- 
 vember 8 sued out in the United States District Court at In- 
 dianapolis an injunction process to prevent the continuance of 
 the strike. This mandate of the court restrained the officials 
 of the United Mine Workers of America from in any way ad- 
 vising their membership on the situation, or contributing any 
 of the moneys of the miners' union to assist the men on strike ; 
 it also restrained them from discussing, writing or entering into 
 any kind of a conversation with their membership on the 
 strike situation. The Department of Justice proceeded even 
 further. It demanded from and the court issued an order 
 commanding the officers of the miners' union to recall and with- 
 draw the strike notification by six o'clock Tuesday, November 
 II. 
 
 Both the restraining order and the injunction, insofar as the 
 prohibitory features are considered, were predicated upon the 
 Lever Act of August 10, 1917, the temporary war measure 
 referred to and which Congress enacted primarily for the pur- 
 pose of preventing speculation and profiteering of the food 
 and fuel supplies of the country. " There never was in the 
 minds of the Congress in enacting that law or in the mind of 
 the President when he signed it," says an official statement of 
 the American Federation of Labor, 1 " that the Lever Act would 
 be applied to workers in cases of strikes or lockouts. The food 
 controller, Mr. Hoover, specifically so stated. Members of the 
 committee having the bill in charge have in writing declared that 
 it was not in the minds of the committee, and the then Attorney 
 General, Mr. Gregory, gave assurance that the Government 
 would not apply that law to the workers' efforts to obtain im- 
 proved working conditions. Every assurance from the highest 
 authority of our Government was given that the law would 
 not be so applied." Nevertheless officials of the United Mine 
 
 1 Issued under date of November 9, 1919.
 
 i;2 THE WORKERS AT WAR 
 
 Workers of America were required to give bond in the amount 
 of $10,000 each on the charge of criminal contempt of court 
 for alleged violation of the Federal courts' injunction, such 
 charges being filed against eighty-four officers of the union. 
 
 On November 9 a specially called meeting of the executive 
 council of the American Federation of Labor, representing 
 114 national and international unions and an individual mem- 
 bership of more than four million workers engaged in all the 
 occupations throughout the country, took up consideration in 
 a most serious attitude of mind the coal miners' strike and the 
 action of the Government in relation to it. The policy of the 
 Department of Justice was a stunning blow to the hopes of 
 the workers, being so diametrically opposed to the harmonious 
 working relations which had been established and which had 
 continued all through the war. The attitude of organized 
 labor as represented by this supreme advisory authority of the 
 labor unions was expressed in an " appeal to the public " con- 
 taining among other things the following : 
 
 " Never in the history of our country has any such manda- 
 tory order been obtained or even applied for by the Government 
 or by any person, company or corporation. 
 
 " The autocratic action of our Government in these proceed- 
 ings is of such a nature that it staggers the human mind. In a 
 free country to conceive of a Government applying for and 
 obtaining a restraining order prohibiting the officials of a labor 
 organization from contributing their own money for the purpose 
 of procuring food for women and children that might be starv- 
 ing, is something that when known will shock the sensibilities 
 of man and will cause resentment. Surely the thousands of 
 men who are lying in France, under the soil, whose blood was 
 offered for the freedom of the world, never dreamed that so 
 shortly afterward in their own country 450,000 workers en- 
 deavoring to better their working conditions, would have the 
 Government decide that they were not entitled to the assistance 
 of their fellow men and that their wives and children should 
 starve, by order of the Government. 
 
 " It is a well-established principle that the inherent purpose 
 of the injunction processes, where there is no other adequate 
 remedy at law, was for the purpose of protecting property and
 
 THE VICIOUS CYCLE 173 
 
 property rights only, thereby exercising the equity power of 
 the courts to prevent immediate and irreparable injury. It 
 was never intended and there is no warrant of the law in all 
 our country to use the injunction power of equity courts to 
 curtail personal rights or regulate personal relations. It was 
 never intended to take the place of government by law by 
 substituting personal and discretionary government. The 
 Lever Act provides its own penalties for violators of its pro- 
 visions. The injunction issued in this case has for its purpose 
 not a trial by court and a jury, but an order of the court pred- 
 icated upon the assumption that the law might be violated 
 and by which the defendants may be brought before the court 
 for contempt and without any trial by jury. 
 
 " We declare that the proceedings in this case are unwar- 
 ranted, as they are unparalleled in the history of our country, 
 and we declare that it is an injustice which not only the workers 
 but all liberty-loving Americans will repudiate and demand 
 redress. The citizenship of our country cannot afford to per- 
 mit the establishment or maintenance of a principle which 
 strikes at the very foundation of justice and freedom. To re- 
 store the confidence in the institutions of our country and the 
 respect due the courts, this injunction should be withdrawn and 
 the records cleansed from so outrageous a proceeding. 
 
 " By all the facts in the case the miners' strike is justified. 
 We indorse it. We are convinced of the justice of the miners' 
 cause. We pledge the miners the full support of the American 
 Federation of Labor and appeal to the workers and the citizen- 
 ship of our country to give like endorsement and aid to the men 
 engaged in this momentous struggle." 
 
 With the statement that they were Americans and being 
 Americans could not fight their Government, the officials of 
 the United Mine Workers issued under protest on November 
 II a formal order, upon the approval and in compliance with 
 the mandate of the court, withdrawing and canceling the strike 
 order of October 16. But the individual mine workers had 
 become so aroused against the Government by what they be- 
 lieved to be the unjustifiable interference of the Department of 
 Justice that they continued almost to a man to remain away 
 from the mines, so that at the end of the week following the 
 issuance of the order canceling the strike there was virtually
 
 174 THE WORKERS AT WAR 
 
 no improvement in the number of miners at work and in con- 
 sequence no appreciable increase in the output of coal. 
 
 It was a blind alley into which the Department of Justice had 
 misled the Government and the American people and out of 
 which there was no graceful retreat, in fact, no escape at all 
 except by retracing the way by which they were led into it. 
 Four hundred and fifty thousand mine workers could not be 
 put in jail, and even if this could be done it would not pro- 
 duce the coal for which by this time there was a moht urgent 
 and pressing demand. 
 
 There is evidence that at this juncture President Wilson 
 himself entered into the situation to take it out of the hands 
 of the amateurs who had only made bad matters worse. The 
 officials of the United Mine Workers were called from their 
 headquarters in Indianapolis to the National Capital and in 
 conference on December 6 had submitted to them by the Secre- 
 tary to the President and the Attorney General a proposal from 
 the President which the officials at once accepted. This em- 
 bodied, in addition to an immediate increase of 14 per cent, 
 in wages, the appointment of a commission of three to be com- 
 posed of one representative each of operators, miners, and 
 the general public with full authority to investigate wages, 
 profits, and all conditions surrounding the industry, with power 
 to increase wages further if they so decided, and with equal 
 power over the price of coal. The Fuel Administration was 
 to be eliminated as a factor in prices and wages. Upon an- 
 .nouncement of this agreement Fuel Administrator Garfield ten- 
 dered his resignation which was accepted. The operators in 
 a public statement announced that they had not been consulted 
 and were not bound by the terms of any such agreement. But 
 it was under these terms, after a strike that had continued for 
 forty days, that the mine workers returned to their employ- 
 ments in the mines.
 
 CHAPTER XVII 
 
 CAUSES AND EFFECTS OF THE VICIOUS CYCLE 
 
 THIS failure in the coal miners' strike of the Government 
 as expressed in its court of law this ineffectiveness of 
 machinery embodying the highest expression of a free people's 
 sovereign power this employment by the Department of Jus- 
 tice of legal principles which the development of socialized 
 production has made antiquated this absence of proper and 
 adequate institutional agencies for protecting and safeguard- 
 ing the public welfare all this is a tremendously serious 
 matter to the American people. So also is the fact of 450,000 
 men, with families dependent upon them for the necessities 
 of life, being compelled by the economic pressure of the high 
 cost of living to cease the work by means of which alone they 
 secure the money wages with which to purchase these neces- 
 sities. When such events as these transpire in a society which 
 boasts of its democracy then something has occurred which 
 should startle the thinking members of that society into a pains- 
 taking examination of the practical workings of its boasted 
 principles of democracy with the view of sounding the depths 
 to discover what is amiss in the working out of those prin- 
 ciples. 
 
 It is true the Wilson Administration, within the limitations 
 of its authority, had put forth efforts months before the coal 
 miners' strike to reduce the cost of living, after completely re- 
 versing its war-period policy of increasing wages to correspond 
 with the increase in the cost of living and of increasing prices 
 to compensate the producer for the increased wages. In a 
 special message to Congress on August 8, 1919, the President 
 recounted these efforts and suggested " effective legal
 
 176 THE WORKERS AT WAR 
 
 remedies " for Congress to supply by new legislation. The 
 message explained the situation as follows: 
 
 " I have sought this opportunity to address you because it is 
 clearly my duty to call your attention to the present cost of 
 living and to urge upon you with all the persuasive force of 
 which I am capable the legislative measures which would be 
 most effective in controlling it and bringing it down. The 
 prices the people of this country are paying for everything that 
 it is necessary for them to use in order to live are not justified 
 by a shortage in supply, either present or prospective, and are 
 in many cases artificially and deliberately created by vicious 
 practices which ought immediately to be checked by law. They 
 constitute a burden upon us which is the more unbearable 
 because we know that it is willfully imposed by those who have 
 the power and that it can by vigorous public action be greatly 
 lightened and made to square with the actual conditions of sup- 
 ply and demand. Some of the methods by which these prices 
 are produced are already illegal, some of them criminal, and 
 those who employ them will be energetically proceeded against ; 
 but others have not yet been brought under the law, and should 
 be dealt with at once by legislation. 
 
 " I need not recite the particulars of this critical matter ; the 
 prices demanded and paid at- the sources of supply, at the fac- 
 tory, in the food markets, at the shops, in the restaurants and 
 hotels, alike in the city and in the village. They are familiar 
 to you. They are the talk of eVery domestic circle and of every 
 group of casual acquaintances even. It is matter of familiar 
 knowledge, also, that a process has set in which is likely, unless 
 something is done, to push prices and rents and the whole cost 
 of living higher and yet higher, in a vicious cycle to which there 
 is no logical or natural end. With the increase in the prices of 
 the necessaries of life come demands for increases in wages 
 demands which are justified if there be no other means of 
 enabling men to live. Upon the increase of wages there follows 
 close an increase in the price of the products whose producers 
 have been accorded the increase not a proportionate increase, 
 for the manufacturer does not content himself with that, but 
 an increase considerably greater than the added wage cost and 
 for which the added wage cost is oftentimes hardly more than 
 an excuse. The laborers who do not get an increase in pay 
 when they demand it are likely to strike, and the strike only
 
 EFFECTS OF THE VICIOUS CYCLE 177 
 
 makes matters worse. It checks production, if it affects the 
 railways it prevents distribution and strips the markets, so that 
 there is presently nothing to buy, and there is another excessive 
 addition to prices resulting from the scarcity." 
 
 Among the recommendations of the President for Congres- 
 sional action was the appropriation of funds to specified Gov- 
 ernment departments and commissions for the collection and 
 making public to consumers of facts as to the supply and 
 prices; the extension of the Food Control Act both as to the 
 period of time during which it should remain in operation and 
 as to the commodities to which it applied; the providing of a 
 penalty for profiteering ; the regulation of cold storage ; re- 
 quiring that all goods destined for interstate commerce be 
 plainly marked with the price at which they left the producer; 
 the licensing of all corporations engaged in interstate com- 
 merce; and the controlling of security issues. 
 
 In his regular message to Congress on December 2, 1919, 
 President Wilson again called the attention of that body to 
 " the widespread condition of political restlessness in our body 
 politics," and stated as one of its contributing causes the " heart- 
 less profiteering resulting in the increase of the cost of living." 
 He renewed his recommendations of August 8 for " legislative 
 measures which would be effective in controlling and bringing 
 down the present cost of living." 
 
 Upon only one of these recommendations had Congress taken 
 action ; it had not even provided a legal penalty for profiteering. 
 Thus is reflected the failure of another of the agencies of the 
 people's Government of their Congress to provide ade- 
 quately for the distressing situation, assuming that the reme- 
 dies proposed by the President would have safeguarded the 
 public welfare which was being gravely menaced. 
 
 The Wilson Administration did conscientiously strive, in a 
 number of ways, such as investigations and prosecutions 
 through its Department of Justice, to bring down the high 
 prices but the feeble efforts its lack of proper organization for
 
 178 THE WORKERS AT WAR 
 
 the purpose enabled it to put forth, in opposition to the more 
 powerfully organized self-interest of producers and sellers, 
 could not be other than unsuccessful. The Government was 
 not prepared for controlling the economic self-interest of pro- 
 ducers in a sellers' market of limiting the effects of the 
 ever-widening circles of increasing prices which radiated out in 
 all directions from the center of increases in food prices. This 
 economic self-interest operated to produce an effect somewhat 
 similar to that which results from throwing a pebble into the 
 still waters of the lake, the first circle ensuing being analogous 
 to the increase in the price of food. Some of the effects of 
 these circles of increasing prices have their significance, 
 
 " New York, Nov. 27. Profits several times in excess of 
 the entire capital invested came back to many coal operators in. 
 1917, William G. McAdoo, formerly secretary of the treasury, 
 declared in a further statement l tonight relative to the coal 
 controversy. The statement follows: 
 
 " * The coal operators assert that I gave out confidential infor- 
 mation when I stated that profits of the mine owners in 1917 
 ranged from 15 to 2000 per cent, on capital stock before de- 
 duction of taxes. This was not confidential information. The 
 Treasury Department may publish statistical matter of this 
 character any time. In fact, information concerning this very 
 subject was furnished by me to the United States Senate in re- 
 sponse to a resolution introduced by Senator Borah concerning 
 profiteering and was published July 5, 1918, In this report the 
 returns of several hundred coal companies showed profits rang- 
 ing from 15 to 800 per cent, on their invested capital in 1917. 
 The range of profits was higher on capital stock. In short, 
 many coal operators got back their entire invested capital 
 several times out of their profits in 1917, as shown by the re- 
 ports, and must now be on velvet.' " z 
 
 " In 1917 all bituminous coal mines east of the Mississippi 
 River made what might be termed fabulous profits, the general 
 
 1 On November 26 Mr. McAdoo had issued a statement to the public 
 in which he charged the coal operators with making "shocking and 
 indefensible profits in 1917." 
 
 2 Associated Press dispatch in "Philadelphia Public Ledger," Nov. 28,, 
 1919-
 
 EFFECTS OF THE VICIOUS CYCLE 179 
 
 average being from 100 to 150 per cent, on invested capital, the 
 range being from 15 to 800 per cent." 1 
 
 " The directors of the American Car and Foundry Company 
 yesterday declared a quarterly dividend of 3 per cent, on 
 the common shares. Three months ago the declaration on the 
 common was 2 per cent., so that the stock is now on a 12 
 per cent, annual basis instead of 8 per cent. The directors 
 increased the reserve for common stock dividends from 
 $7,200,000 to $10,800,000, this to be paid when and as declared 
 by the directors. The latter amount provides funds for divi- 
 dends at 12 per cent, over a period of about three years." 2 
 
 " The annual report of the American Locomotive Company 
 for the fiscal year ended June 30, shows earnings^which have 
 never been surpassed in the history of the company. The gross 
 earnings amounted to $108,923,524, an increase of approxi- 
 mately $28,000,000 over the gross earnings in the previous re- 
 port. After all charges, taxes, and preferred dividends there 
 was a balance available for the common stock of $10,262,567, 
 or the equivalent of $41.05 on the 250,000 shares outstanding. 
 The previous peak for earnings was shown in the report for 
 the year ended in June, 1916, when there was $9,019,429, or 
 $36.08 a share for the common stock," * 
 
 " Of all textile prices, the advances in cotton yarns are in a 
 class by themselves. Such advantage has been taken of the 
 dearth of cotton yarns that prices, especially for the finer 
 counts, are stupidly high and excite resentment. The profiteer- 
 ing landlord who boosts rents 150 per cent, has a heart com- 
 pared with the cotton yarn spinner whose prices range from 
 four and a half to seven times what they were in 1915. Any 
 attempt to justify present yarn prices on a basis of fair profit 
 to the mill and decent regard for living costs to the public, 
 must explain away the 100 per cent, stock dividends 
 declared by spinning mills and the statements of profits issued 
 by several groups on the flotation of additional stock to increase 
 control of this business. ... A necessary part of our recon- 
 struction is a rebellion against grossly excessive profits. It 
 
 1 Statement by Secretary of the Treasury Carter H. Glass, Nov. 
 26, 1919. 
 
 2 " New York Times," October 5, 1919.
 
 i8o THE WORKERS AT WAR 
 
 will occur when the public learns who are making them and 
 refuses to pay tribute which is unjust and dishonorable." 1 
 
 " The American Woolen Company yesterday issued the best 
 annual report in its history, the net profits for 1919 amounting 
 to $15,513,415 after making provision for Federal taxes. In 
 1918 the net profits were $12,324,084. The net profits of 1918 
 were slightly higher than those reported in the present state- 
 ment but in that year no allowance was made for Federal taxes. 
 After all charges there was a surplus available for dividends 
 last year of $10,779,804, or the equivalent of $39.89 a share on 
 the common stock, after making allowance for the preferred 
 distribution. . . . The surplus of the company now stands at 
 $31,754,427." 2 
 
 " The United States Steel Corporation in its report for the 
 first quarter of this year, issued yesterday, shows net earnings 
 of $42,089,019, a total greater than for any quarter of 1919. 
 Not since the third quarter of 1918 has the corporation been 
 able to present such an excellent record. . . . The record of 
 earnings was considered by many as one of the most remarkable 
 ever put out by the corporation. ... It had been expected by 
 some that the corporation would resume extra dividend pay- 
 ments at this time, provided earnings seemed to warrant such 
 disbursements. The surplus after dividends would have per- 
 mitted a large extra declaration, but the surplus earnings went 
 into the corporation's already well stocked reserve fund." 3 
 
 " A reflection of the activity which prevailed in the automo- 
 bile industry during the first six months of this year is found in 
 the half yearly report of the General Motors Corporation. The 
 net profits amounted to $48,900,800, or nearly double the 
 amount reported for the corresponding period of last year. 
 The surplus for the six months of this year after dividends was 
 $20,283,508 as compared with a surplus of $6,098,825 for the 
 first six months of last year. The surplus for the present half 
 
 1 Public Ledger report of an address by Mr. Lincoln Cromwell, of 
 William Iselin & Company and in charge during the war of knit goods 
 buying for the War Department and of knitting mill production for 
 the War Industries Board, made before the sixteenth annual conventioa 
 of the National Association of Hosiery and Underwear Manufacturers 
 in Philadelphia, April 27, 1920. 
 
 2 " New York Times," April 28, 1920. 
 * Ibid., April 28, 1920.
 
 EFFECTS OF THE VICIOUS CYCLE 181 
 
 year is just about the equivalent of the total surplus of the com- 
 pany on June 30, 1918. The total surplus now stands at 
 $53,692,445." 
 
 " The preliminary report of the American Telephone and 
 Telegraph Company for the year ended December 31, 1919, 
 shows a net income available for dividends of $44,377,865, this 
 being the equivalent of $10.04 a share earned on the capital 
 stock. In the report of the preceding year the net income was 
 $43,901,324 or $9.93 a share. The total income of $70,461,130 
 is an increase of approximately $9,400,000 over that of 1918. 
 Net earnings show a gain over the preceding year. They 
 amounted to $60,225,461, as compared with $54,293,016 a year 
 ago. In 1916 the net earnings were $44,743,376 and in 1917 
 they amounted to $48,940,466." 2 
 
 " From December 31, 1914, to December 31, 1918, one hun- 
 dred and four industrial companies, after heavy expenditures 
 for new construction and acquisitions and record-breaking divi- 
 dends, added a total of nearly $2,000,000,000 to working 
 capital. Practically all this increase came from surplus earn- 
 ings. Although these corporations represent only a small part 
 of the great industrial wealth of the United States, they give 
 a good idea of the country's tremendous expansion in values 
 from the beginning to the end of the war. Nearly all lines 
 of trade and industry prospered during the war." 3 
 
 Similar reports of unprecedentedly large earnings accom- 
 panying the increase in the cost of living, which earnings were 
 distributed to stockholders in dividends of various kinds and 
 added to surplus funds of the corporations, were also made by 
 virtually every corporation dealing in the commodities which 
 enter into the necessities of the daily life of the American 
 people. Meats, sugar, flour, tobacco, shoes, copper these 
 and all the other articles of daily consumption also bore their 
 
 *** New York Times," October 5, 1919. 
 
 2 " New York Times," January 15, 1920. 
 
 3 " Christian Science Monitor," September 8, 1919. See also testimony 
 submitted by Mr. W. Jett Lauck before the Railroad Labor Board in 
 behalf of the demands of railway employes for higher wages, May, 
 1920.
 
 1 82 
 
 share of the tribute that went to increase the cost of living to 
 the workers. Does not this suggest that something is amiss 
 with the working out of the principles of American democracy? 
 Did not our soldiers go all the way to France to overthrow 
 Prussian autocracy? 
 
 But these brief references to the financial reports of cor- 
 porations showing the huge profits they exacted through their 
 control of the price machinery of the high cost of living reflect 
 only one side of the picture of the effects of extortionate prices. 
 Let us take a brief glance also at the reverse side. 
 
 Within nine months of the signing of the Armistice by Ger- 
 many the five leading headlines to news articles or " stories " 
 on the front page of the " New York Times " were the fol- 
 lowing : 
 
 B. R. T. 1 AGAIN SHUTS DOWN J HYLAN 2 INTERVENES FOR UNION. 
 CAR STRIKERS DEFY POLICE. DRAG CREWS FROM POSTS DESPITE 
 BLUECOATS ORDERED TO GUARD THEM. MAYOR APPEALS TO 
 COURTS BUT FEDERAL JUDGE REFUSES TO COMPEL RECEIVER TO 
 DEAL WITH LEADERS. ASSERT QOOO MEN ARE OUT. COMPANY 
 AGAIN ABANDONS SERVICE AT NIGHT, BUT PROMISES TO RESUME 
 THIS MORNING. 
 
 ACTORS STRIKE, SENDING 12 BROADWAY AUDIENCES HOME. IOO 
 LEADING PLAYERS OUT. MANAGERS GET NOTICE OF FROM FIVE 
 MINUTES TO HALF AN HOUR. ALL THE HOUSES FILLED. 
 PATRONS SPEND HOURS COLLECTING ON REFUND CHECKS AT BOX 
 OFFICES. MORE SHOWS MAY BE HIT. EQUITY ASSOCIATION 
 EXPECTED TO ATTACK VAUDEVILLE, BURLESQUE, AND MOVIE 
 
 HOUSES. 
 
 WILSON 3 URGES 8o,OOO RAILWAY SHOPMEN TO RETURN TO WORK. 
 WILSON ASKS HINES * TO ACT. SAYS RAILROAD DIRECTOR HAS 
 POWER TO PASS ON SHOPMEN'S WAGES. BUT DEMANDS STRIKE 
 STOP. ASSERTS WORKERS THEMSELVES BLOCK POSSIBILITY OF 
 SOLVING HIGH COST OF LIVING. CUMMINS 5 FREES PRESIDENT, 
 
 1 Brooklyn Rapid Transit Company. 
 
 z Mayor of Greater New York including Brooklyn. 
 
 8 President of the United States. 
 
 * Director General United States Railroad Administration. 
 
 5 Chairman Interstate Commerce Committee, United States Senate.
 
 EFFECTS OF THE VICIOUS CYCLE 183 
 
 INFORMS EXECUTIVE CONGRESS HAS ALREADY GIVEN HIM FULL 
 AUTHORITY IN RAILROAD MATTERS. 
 
 LAHEY TO CHECK STRIKE VIOLENCE. DEPUTY POLICE COMMIS- 
 SIONER ASSUMES CHARGE AND PROMISES STERN MEASURES. 
 DISORDERS HALT SUDDENLY. MOTOR TRUCKS READY TO QUELL 
 RIOTS IOO MANHATTAN DETECTIVES WILL AID. 
 
 SHOPMEN STRIKE ON THE NEW HAVEN. WALKOUT OF 7OOO 
 
 WORKERS RESULTS IN CURTAILMENT OF PASSENGER SERVICE. 
 
 AFFECTS WHOLE SYSTEM. CONTINUED SPREAD OF STRIKE IN THE 
 
 WEST BRINGS FREIGHT EMBARGOES ON MANY ROADS. 
 
 The daily newspaper may properly be regarded as a mirror 
 of current events, in its more or less accurate accounts reflect- 
 ing the important problems in the life of the American people 
 which are the mainspring of their thoughts and which agitate 
 them to action. From all over the United States the news of 
 these events is carried each day by the telegraph wires into 
 the office of the newspaper to the desk of the news editor 
 whose trained mind separates out the more important events 
 and directs their display on the front page. Thus the front 
 page of the newspaper serves as a barometer for measuring 
 the relative importance of the day's happenings. With the 
 front page given up to strike activities and their issues flowing 
 out of the high cost of living is there not evidence that some- 
 thing is amiss in the working out of the principles of democ- 
 racy in America? 
 
 The same issue of " The New York Times " contained news 
 accounts of municipal policemen in labor unions affiliating with 
 the American Federation of Labor ; as to the request of postal 
 employes of the United States Government for a 50 per cent, 
 increase in pay: as to the threat of white labor union em- 
 ployes in the Chicago stock yards to strike if special police and 
 militia on guard to quell further race riots against imported 
 non-union negroes were not withdrawn ; and as to the effects 
 on the cost of living of surplus products in storage warehouses 
 and the activities of city and State officials against profiteers 
 in relation thereto. In the same issue the leading editorial
 
 184 THE WORKERS AT WAR 
 
 discussed the proposal of the organized railway employes for 
 the nationalization of the railroads of the United States and 
 the attitude of the president of the American Federation of 
 Labor in accepting the honorary presidency of the League or- 
 ganized to further the nationalization plan. Another editorial 
 discussed " The Police in the Strike," and still another " Let 
 No Guilty Profiteer Escape." On the editorial page was also 
 a communication from a correspondent on " Railroad Profit 
 Sharing." This is but one day's summary from one of our 
 leading newspapers of the news events that have to do with 
 various aspects of the labor problem which the increase in the 
 cost of living had made most acute. 
 
 For the single month of August, 1919, these news events 
 included a strike in the silk mills of Paterson, New Jersey ; 
 in machine shops at Waterloo, Iowa ; among the men who 
 man the fishing boats that daily go out to sea from the harbor 
 of Boston ; by shopmen of the New York Central at Depew, 
 New York, of the Baltimore and Ohio at Cumberland, Mary- 
 land, and of the Chicago, Burlington and Quincy at Havelock, 
 Nebraska; of employes of the Standard Steel Car Company 
 at Hammond, Indiana ; motormen and conductors of the New 
 York, Westchester and Boston Railway, a subsidiary company 
 of the New Haven system ; of employes of the Pittsburgh Rail- 
 ways Company at Pittsburgh, Pennsylvania; of trainmen, en- 
 ginemen, yardmen, and allied crafts in shops of the Southern 
 Pacific, the Atchison, Topeka and Santa Fe and the other steam 
 railroads entering Los Angeles, California; of employes at 
 Los Angeles of the Pacific Electric, an interurban railway sys- 
 tem of southern California, and of the Southern Public Util- 
 ities Company in Charlotte, North Carolina. In New York 
 City alone in the month of August there were strikes of con- 
 ductors and motormen of the Interborough Rapid Transit'Com- 
 pany and of the Brooklyn Rapid Transit Company; of stage- 
 hands, musicians, actors and actresses; of employes of the 
 Brooklyn Union Gas Company; of waiters in lunch rooms
 
 EFFECTS OF THE VICIOUS CYCLE 185 
 
 and small restaurants all over the city; of employes of bak- 
 eries ; of cigarmakers ; of workers in ladies' tailoring factories ; 
 of window cleaners; of numerous crafts engaged in the con- 
 struction of buildings, and so on. 
 
 At the same time these and other strikes were in progress, 
 the 500,000 members of the various crafts employed in the 
 steam railroad shops of the country were voting in favor of a 
 strike beginning September 2 in the event their demands for 
 increased wages with which to meet the increase in cost of 
 living were refused by the Railroad Administration of the 
 Federal Government. A strike vote was also being taken by 
 the maintenance of way employes on the American railroads. 
 Officials of other railway organizations representing more than 
 1,500,000 employes were submitting to the Director General 
 of the Railroad Administration demands for wage increases 
 equal at least to the increase in the cost of living. A nation- 
 wide strike of the workers in the iron and steel mills of the 
 country had been voted to become effective August 30, and it 
 was only being delayed until the outcome of attempts on the 
 part of union leaders to secure conferences with officials of the 
 United States Steel Corporation. Twenty-four separate or- 
 ganizations of steel and iron mill employes were involved in 
 this movement affecting approximately 370,000 men. 
 
 Among the hundreds of thousands of other workers who in 
 August, 1919, were formulating demands with the possibility 
 of strikes to enforce them were cigar store clerks in New 
 York City, members of the Order of Railroad Telegraphers, 
 involving practically every railroad in the United States and 
 Canada ; clerks in drug stores in New York City ; civil service 
 clerks in the New York City and county offices ; postal em- 
 ployes of the United States Government in all parts of the 
 country; policemen in the National Capital and other cities. 
 
 And all this, too, with political autocracy as represented by 
 the Imperial German Government prostrate across the sea 
 largely in consequence of America's efforts " to make the
 
 186 THE WORKERS AT WAR 
 
 world safe for democracy"! That very same powerful Gov- 
 ernment had failed at home to protect its wage workers from 
 the effects of the " Vicious Cycle " ! The capitalist-producer 
 and seller was in the saddle and he was applying the spurs 
 to the wage-worker consumer.
 
 CHAPTER XVIII 
 
 THE VICIOUS CYCLE, STRIKES, AND THE CONSUMER 
 
 IF the wage workers were the only members of our de- 
 mocracy injuriously affected by the increase in the cost of 
 living and by the inability, or at least the failure, of the Gov- 
 ernment to protect and safeguard the economic welfare of its 
 people, the situation would still be serious but not so much 
 so as it is when millions of other consumers are also similarly 
 affected. For the great outstanding fact is that the unprec- 
 edented rise in the cost of living during and following the war 
 and the strikes of the wage worker to protect himself against 
 its effects, have been and continue to be a grievous burden upon 
 the numerous members of another class of citizens the class 
 that is solely dependent for the necessaries of life upon an- 
 nual salaries ranging from fifteen hundred to ten thousand 
 dollars. 
 
 In only exceptional cases have these citizens been able to 
 increase their salary income to meet the increase in the cost of 
 living. They have had to draw upon their insurance and other 
 savings, in many cases the wife and children " went out to 
 work," educational and other advantages have had to be with- 
 held from the children, and in scores of like sacrifices the 
 standard of living has been lowered. And when the standard 
 of living of " the great middle class " is thus affected there 
 remains no longer any doubt whatever as to something being 
 amiss in the working out in the United States of the principles 
 of democracy. 
 
 Upon the citizens comprising this middle class citizens 
 who are neither wage workers in the customary use of that 
 term nor capitalist-producers has fallen virtually the entire 
 economic burden of the costly war. Members of all the pro- 
 
 "187
 
 i88 THE WORKERS AT WAR 
 
 fessional classes, such as lawyers, physicians, dentists, clergy- 
 men, editors and reporters, engineers, school teachers and col- 
 lege and university professors ; city, county, State, and Fed- 
 eral employes, and other innumerable salaried workers of all 
 kinds who have very little if any control over increasing the 
 amount of their money income, have found each month the 
 money compensation for their services purchasing less and less 
 of the necessaries of life as the prices of these rose higher and 
 ever higher. With the amount of their money salary remain- 
 ing stationary, the constantly increasing prices as constantly 
 decreased their real salary as measured in terms of food, cloth- 
 ing, and shelter. 
 
 Agitations in consequence sprang up all over the country 
 for increased pay to policemen, firemen, public school teachers, 
 and other Government employes; in colleges and universities 
 " drives " were inaugurated to secure funds with which to in- 
 crease the salaries of professors; religious denominations 
 started movements to secure " endowment funds " for increas- 
 ing the salaries of ministers of the gospel. So great was the 
 economic pressure that in some communities school teachers, 
 and also college professors, organized themselves into unions 
 and applied for charters of affiliation with the American Fed- 
 eration of Labor. Congress found it necessary to increase to 
 the extent of a bonus of $240 a year the salaries of clerical em- 
 ployes in the District of Columbia receiving less than $2500 a 
 year, and appointed a commission to adjust the classification 
 and pay of all Federal employes in the District. Congress also 
 voted increases in pay to postal and other Government em- 
 ployes. These were reflected in increased taxes which in turn 
 increased the prices of commodities. So the " Vicious Cycle " 
 kept on cycling. 
 
 In warding off the attacks of increasing prices upon their 
 standard of living policemen, firemen^ letter carriers and other 
 postal employes, clerical workers of all kinds, and that whole 
 catagory. of citizens in the service of city, county, State, and 
 National governments were forced to complain. Unorganized,
 
 STRIKES AND THE CONSUMER 189 
 
 at first they were helpless and their appeals and protests went 
 unheeded; some formed unions and applied to the American 
 Federation of Labor for charters, at the same time formulating 
 demands for salary increases at least equal to the increase in 
 the cost of living. In the National Capital, even policemen 
 organized themselves into a union and appealed to the Ameri- 
 can Federation of Labor for its support of their demands for 
 an increase in their pay. The District of Columbia Commis- 
 sioners ordered the policemen who were members of the union 
 to renounce affiliation with the Federation on pain of trial for 
 insubordination. By September, 1919, policemen in as many 
 as thirty different cities scattered over the country had simi- 
 larly organized into labor unions and had become affiliated with 
 the Federation. In Boston about twelve hundred members 
 of the Policemen's Union of that city actually went out on 
 strike on September 9, and for two days the city was given 
 over to rowdyism and rioting until State militia ordered out 
 by the Governor of Massachusetts restored order. The imme- 
 diate cause of the strike was the disciplining of policemen for 
 joining the union contrary to orders of the Police Commis- 
 sioner, but the real cause was protest by the policemen against 
 the delay in increasing their pay to meet the increase in the 
 cost of living. 
 
 Not only has the consumer other than the wage worker been 
 affected seriously in his economic interests by the increase in 
 the cost of living which affects the wage worker, but the con- 
 sumers' economic welfare has also been disadvantageously in- 
 jured by the efforts the wage worker has been compelled to 
 exert by means of the strike in order to protect his wage stand- 
 ard. How grievously the consumers' economic interest suffers 
 by the limitation of output and all the other causes of price 
 increases resulting from these suspensions of production can 
 be indicated, in the absence of more complete information, 
 from reports of the Bureau of Labor Statistics. 1 These show 
 
 1 " Monthly Labor Review," Department of Labor, United States 
 Government.
 
 190 THE WORKERS AT WAR 
 
 the number of strikes and lockouts, their duration, the number 
 of workers involved, the industries and occupations affected, 
 the specific causes which brought them about, and the States 
 in which they occurred. 
 
 A strike is where several or more employes collectively re- 
 fuse to continue at work unless the employer complies with 
 their specific demands. A lockout is where the employer re- 
 fuses to allow several or more employes to continue at work 
 except under specified conditions determined by the employer. 
 Neither a strike nor a lockout includes those innumerable cases 
 in which a single employe without cooperation with others 
 voluntarily ceases work or is refused continued employment 
 and in which there is dissatisfaction on one side or the other. 
 These instances, while they involve the principles of a strike 
 or lockout in that there is disagreement as to the conditions of 
 employment or with the employes' services, and to this extent 
 may be looked upon as an " individual strike '* or " lockout," 
 still these are usually considered under what is termed in in- 
 dustry as "labor turnover." 
 
 Here is the summarized record as to the number of strikes 
 and lockouts each year for the past four years: 
 
 FOUR YEARS OF STRIKES AND LOCKOUTS 
 
 Total 
 
 
 No. of 
 Strikes 
 
 No. of 
 Lockouts 
 
 121 
 
 1018 
 
 1 212 . 
 
 
 IQI7. . 
 
 . 4,^24 . . . 
 
 , . . . . 126 
 
 1016. . 
 
 . ^.68 1 , 
 
 , 108 . 
 
 3,789 
 
 The duration of these strikes and lockouts in 1919 totaled 
 as many as 60,070 days; in 1918, 29,895 days; in 1917, 26,981 
 days and in 1916, 49,680 days. As a general statement, lock- 
 outs continue on the average a longer number of days than 
 strikes. 
 
 These statistics are not in the slightest degree indicative of 
 the amount of working time actually lost to production, as they
 
 STRIKES AND THE CONSUMER 191 
 
 do not take into consideration the number of workers involved. 
 For illustration, on this latter basis in New York State alone 
 in 1918 fifty-six strikes in the metal, machines, and convey- 
 ances trades, involving 29,870 workers, resulted in the loss to 
 production of 890,636 working days. Three strikes in the 
 shipbuilding industry, in which 10,250 men participated, caused 
 a loss of 720,950 days' time. A strike of two thousand shoe 
 cutters at Long Island City before it was terminated totaled 
 a loss in working time of 100,000 days; eight strikes in the 
 leather and rubber goods trades, involving 4,167 workers, re- 
 sulted in a loss of 159,433 days of working time. In the food, 
 liquor, and tobacco group of industries twenty-seven strikes 
 affecting directly 10,091 workers caused a loss of 147,088 days' 
 time. In the clothing and millinery trades alone in New York 
 the loss of working time from strikes was 578,644 days in 1917, 
 the huge total of 7,124,366 days in 1916, a total of 314,328 days 
 in 1915, and 152,812 days in 1914. In addition there was loss 
 in working time by other workers indirectly affected by these 
 strikes. 
 
 Complete records are not available for the total number of 
 workers involved in all these strikes and lockouts. In 74 per 
 cent, of the disturbances in 1919 as many as 4,112,507 persons 
 were directly affected ; in 64 per cent, of the cases in 1918 
 workers to the number of 1,239,989 were involved; in 52 per 
 cent, of the strikes and lockouts in 1917 a total of 1,227,254 
 men and women were participants ; and in 70 per cent, of the 
 cases in 1916 there were involved 1,599,917 workers. If the 
 average number of individuals taking a direct part in strikes 
 and lockouts as determined by these statistics holds good, and 
 there is no reason why this assumption is not plausible, then 
 in 1919 the number of persons involved directly exceeded 
 5,000,000; in the preceding year 1,858,000; in 1917, 2,120,000; 
 and in 1916 more than 2,207,000. 
 
 This cessation of employment through strikes and lockouts 
 of millions of toilers simply means an interruption to con- 
 tinuous production which results in an appalling limitation on
 
 192 THE WORKERS AT WAR 
 
 output, and this in turn effects a continuance of high prices or 
 an increase in prices. As a decrease in the supply of com- 
 modities in relation to demand has an important influence on 
 prices, other economic factors remaining the same, such limita- 
 tion of supply by strikes and lockouts is extremely injurious to 
 the economic interests of the consumer and, as the wage worker 
 is a consumer, ultimately to those of the worker himself. The 
 consumer pays the bill sooner or later he has to meet all this 
 enormous cost of these industrial disturbances. This cost is 
 so great as to be beyond computation it runs up each year 
 into the millions and hundreds of thousands of millions of dol- 
 lars. In one sense of the word the effect is virtually the same 
 as it would be if an amount of goods equal to the quantity that 
 would have been produced during the continuance of the strike 
 was assembled and a match applied resulting in its complete 
 destruction. 
 
 The economic effects of these strikes and lockouts are nation- 
 wide, notwithstanding the larger number take place in the 
 eastern industrial centers. This is true for the simple reason 
 that under modern conditions of distribution commodities 
 manufactured in, say, Massachusetts and New York, are con- 
 sumed in, say, California and Oregon ; goods produced on the 
 Pacific Coast are consumed on the Atlantic. The geographical 
 concentration of strikes and lockouts is indicated in the state- 
 ment that 58 per cent, of the total number in 1919, 6p per 
 cent, of those in 1918, 56 per cent, in 1917, and 72 per cent, in 
 1916 occurred in the seven States, New York, Pennsylvania, 
 New Jersey, Massachusetts, Connecticut, Ohio, and Illinois. 
 
 As to the industries affected, the largest number of strikes 
 and lockouts took place in the metal trades, in mining, in the 
 building trades, clothing industries, textile industries, and 
 transportation, these six groups of industries comprising more 
 than one-half of all the industrial disturbances in each of the 
 four years from 1916 to 1919. Other leading industries 
 seriously affected were iron and steel, lumber, furniture, meat 
 cutting, paper manufacturing, printing and publishing ship-
 
 STRIKES AND THE CONSUMER 193 
 
 building, stone-work, and tobacco. Grouped according to the 
 occupation of the workers directly involved, as measured by the 
 number of men affected, the strikes were principally among coal 
 miners, machinists, molders, teamsters, carpenters, longshore- 
 men, bakers, building laborers, freight handlers, painters, 
 plumbers and steamfitters, street railway employes, and 
 tailors. 
 
 The important strikes and lockouts in 1919 were those of 
 the 435,000 bituminous coal miners, the 367,000 iron and steel 
 workers, the 250,000 railroad shop employes, the 125,000 build- 
 ing trades' workers of New York City, the lockout of the 
 115,000 members of the building trades of Chicago, the 100,000 
 shipyard workers of New York City and vicinity, the 100,000 
 longshoremen at the Atlantic Coast ports, the 65,000 employes 
 of the Chicago stockyards, and the general strike in Tacoma 
 and Seattle in sympathy with the strike of the 60,000 members 
 of the metal trades of those cities. These nine strikes alone 
 involved more than 1,600,000 individuals. 
 
 In 1918 the more important strikes were those of the tailors 
 in New York City; employes in the textile industry in New 
 Hampshire, Rhode Island, and Philadelphia; among the gar- 
 ment workers in Chicago ; in the paper mills of northern New 
 York ; the cigar makers of New York City and St. Louis ; on 
 the trolley systems of Buffalo, Kansas City, and St. Louis ; the 
 molders and teamsters of Chicago; the retail clerks of St. 
 Louis; the separate strikes of pressmen, waiters, and subway 
 laborers in New York City ; the strikes at the General Electric 
 plants; and the general strike in Kansas City. In 1917 
 the important strikes were in the oil fields of Louisiana and 
 Texas; on the telephone systems in Arkansas and the Pacific 
 northwest ; in the packing houses in St. Louis and Omaha ; 
 among the sugar-cane workers in Porto Rico; in the sugar 
 refineries in New York and Philadelphia; among the potters 
 in Ohio and New Jersey; in the silk mills in Hoboken, New 
 Jersey, and vicinity; in the iron and steel industry in Pitts- 
 burgh ; among the cigar makers in Porto Rico and New York
 
 194 THE WORKERS AT WAR 
 
 City; hatters in Danbury, Connecticut; shoemakers in New 
 York City ; in the various clothing industries in New York City, 
 Philadelphia, and Chicago ; in the lumber industry of the north- 
 west; and the general strikes in Minneapolis and St. Paul. 
 
 Considered from the point of view of the specific causes of 
 these strikes and lockouts the facts disclose that by far the 
 larger number were the result of demand on the part of 
 the workers for increases in wages, which demand was quite 
 frequently coupled with others as to changes or improvements 
 in conditions of employment, such as a reduction in the hours 
 of work. For the four years under review, the other causes 
 in the order of their importance as measured by the number 
 of strikes and lockouts, were " recognition of the union," dis- 
 charge of employes, " recognition " and wages, and a decrease 
 of hours of work. Other causes were the employment of 
 non-union men, conditions of employment, disputes over the 
 terms of the wage agreement, sympathetic strikes, trade union 
 jurisdictional controversies between two or more unions, dis- 
 charge of foreman demanded, non-payment of wages, decrease 
 in wages, and against an increase in the hours of work. 
 
 There is still another very important aspect of these strikes 
 and lockouts in their effects upon the economic interests of the 
 consumer besides their enormous direct and indirect loss in 
 production. This is illustrated in the case of the strike of the 
 bituminous coal miners in November-December, 1919 It 
 will be recalled that this strike was ordered at the beginning of 
 winter, at which time the demand for fuel is greatest, with 
 virtually no mined surplus on hand because of the war, demands 
 having been so great as to consume the coal almost as fast as 
 it could be mined. In consequence of this situation, at the 
 very beginning of the strike, with production less than 50 
 per cent, of normal, the consumer was made to feel the effects 
 of this cutting off of the fuel supply. 
 
 The Fuel Administration, hastily recalled by the threatening 
 conditions to the exercise of its far-reaching war powers, put 
 into effect over the entire country the most drastic restrictions
 
 STRIKES AND THE CONSUMER 195 
 
 on the use of bituminous coal for lighting and heating pur- 
 poses restrictions that were even more severe than those 
 imposed by it in the unprecedentedly cold winter of 1917-18. 
 These restrictions prohibited ornamental lights, " white way " 
 and other unnecessary street lights, outline lighting, electric 
 signs, illuminated billboards, and show window and show case 
 lights. Cabarets, dance halls, pool rooms, and bowling alleys 
 were permitted to use light only between 7 P. M. and n p. M. 
 All stores, excepting those selling food, and warehouses could 
 not use other than safety lights except for six hours a day, 
 and manufacturing plants only during the time prescribed for 
 the use of power. Drug stores and restaurants were required 
 to reduce lighting one-half. General and office lights had to 
 be cut off not later than 4 P. M. in office buildings, except neces- 
 sary Federal, State, and municipal offices and except where 
 office operation of vital industries was involved. Only enough 
 heat was permitted in offices, stores, warehouses, and manu- 
 facturing plants to keep the average temperature at 68 degrees 
 Fahrenheit, and then only during the hours for which light 
 was permitted. During other hours only enough heat was to 
 be used to prevent the freezing of water pipes or sprinkler 
 systems. 
 
 A coal famine in many communities became a distressing 
 reality. The Railroad Administration was compelled to cur- 
 tail passenger service on steam railroads to a greater extent 
 than was ever known before, it being estimated that 200,000 
 train miles a day were eliminated ; it placed embargoes on the 
 movement of fuel oil out of the West; it reduced the amount 
 of coal permitted to go to coking ovens; it confiscated ship- 
 ments of coal and caused their distribution at points of greatest 
 need. Half time working schedules were made effective in 
 industries generally; retail stores in the large cities opened 
 at noon and closed at six o'clock ; hours of work for govern- 
 ment employes were reduced ; school houses, churches, movies, 
 theatres, and like public places were limited in the amount of 
 coal and in cases were closed completely. In some States, such
 
 196 THE WORKERS AT WAR 
 
 as Missouri, Oklahoma, and Kansas, the Governors ordered the 
 seizure of coal mines by the State and volunteers went into the 
 mines and dug coal in order to meet the necessities of hospitals 
 and like pressing public needs. 
 
 A conference of Governors of seven of the soft coal pro- 
 ducing States held in Chicago November 30 appealed to the 
 Federal Government for an equitable distribution of the coal 
 supply in stock " among the forty-eight States on the basis of 
 their needs as developed during the war regardless of the State 
 where mined " ; also for the immediate establishing, promul- 
 gating, and enforcing of " rigid and uniform rules and regula- 
 tions for the greatest conservation of coal throughout the 
 Union." 
 
 In brief, all that came about which was foreseen in the 
 President's statement to the public on October 25 when it said, 
 referring to the refusal of the miners' leaders to call off the 
 strike : 
 
 " This is one of the gravest steps ever proposed in this coun- 
 try affecting the economic welfare and the domestic comfort 
 and health of the people. It is recognized that the strike would 
 practically shut off the country's supply of its principal fuel 
 at a time when interference with that supply is calculated to 
 create a disastrous fuel famine. All interests would be af- 
 fected alike by a strike of this character, and its victims would 
 be not the rich only, but the poor and needy as well, those least 
 able to provide in advance a fuel supply for domestic use. It 
 would involve the shutting down of countless industries and the 
 throwing out of employment of a large part of the workers of 
 the country. It would involve stopping the operation of rail- 
 roads, electric light and gas plants, street railway lines and 
 other public utilities, and the shipping to and from this country, 
 thus preventing our giving aid to the allied countries with sup- 
 plies which they so seriously need. . . . From whatever angle 
 the subject may be viewed, it is apparent that such a strike 
 in such circumstances would be the most far-reaching plan 
 ever presented in this country to limit the facilities of produc- 
 tion and distribution of a necessity of life and thus indirectly 
 to restrict the production and distribution of all the necessaries 
 of life."
 
 STRIKES AND THE CONSUMER 197 
 
 As another illustration of the effects of strikes on the con- 
 sumer let us select one more localized in its immediate conse- 
 quences that of the employes of the Interborough Rapid 
 Transit Company of New York City on its elevated and sub- 
 way systems of transportation on Manhattan Island. The 
 charge was made in the press by Mayor Hylan of Greater 
 New York that this strike was called by the " company union " 
 in collusion with officials of the corporation primarily for the 
 purpose of forcing an eight cent in place of the five cent fare. 1 
 The City of New York owns the subway lines which are leased 
 to the Interborough. The situation was complicated by a con- 
 test between two different labor organizations for jurisdiction 
 over the employes. The strike was precipitated August 16, 
 1919, and the demands of the workers were for a 50 per cent, 
 increase in wages, a forty-eight hour working week, and time 
 and one-half payment for over-time work. It was settled by 
 an increase of 25 per cent, in wages and agreement to submit 
 the question of a further increase and the other demands to 
 arbitration. 
 
 For as long as forty-eight hours the operation of the two 
 subway and the four elevated lines were at a complete stand- 
 still notwithstanding efforts to settle the controversy that were 
 put forth by the Mayor of the city, the Public Service Com- 
 mission, and the Governor of the State. Some of the effects 
 
 1 Following the settlement of the strike Mayor Hylan issued a state- 
 ment to the public in which he said : " As Mayor of the City of New 
 York I am more than pleased and gratified that the lockout perpetrated 
 by the Interborough officials and their unions against the people of 
 the city has been settled. ... As each hour of the lockout against the 
 people continued it became nore apparent to the general public that 
 there was an understanding between the self -organized heads of the 
 Interborough's unions and certain officials of the company. I trust the 
 District Attorney of this county will continue his probe into the ques- 
 tions leading up to the lockout, so that in the future the traveling public 
 of our city cannot be subjected to so great inconvenience at the will of 
 a transit corporation which seeks to extort and whose sole purpose is 
 to filch from the pockets of the public an increased fare." " New York 
 Times," August 19, 1919.
 
 198 THE WORKERS AT WAR 
 
 upon the consumer are indicated in the " New York Times' " 
 account of the occurrence. 1 
 
 " Cessation of travel in the Interborough subways and on the 
 elevated lines, on which more than 2,000,000 passengers are 
 carried daily, caused a congestion of vehicular traffic in all the 
 streets on Manhattan Island yesterday that has never been 
 matched in the memory of the Traffic Division of the Police 
 Department. This unusual condition, caused by the efforts to 
 carry on one traffic level the passengers usually carried on three 
 levels, continued throughout the day. Although emergency 
 measures were adopted to absorb the crowds, the street cars 
 and buses were unable to convey any of their passengers in 
 comfort. More than fifty persons, three of them traffic police- 
 men, were injured in jams and accidents during the day and 
 one unidentified woman was killed. 
 
 " When the city's 2,000,000 travelers who generally use the 
 subways and elevated lines awoke with the problem on their 
 minds of devising some new way of reaching offices and fac- 
 tories, they found that there was rainy weather to add to the 
 difficulties of their travel. Persons who had expected to find 
 a new means of travel an adventure found instead that the 
 chill and rainy weather and the necessity of fighting through 
 enormous throngs made travel a tremendous hardship. In the 
 crushes at the main traffic points throughout the city hundreds 
 of persons were forced to abandon their efforts to reach the 
 lower part of Manhattan Island so that they could work a few 
 hours. Banks and other large institutions, employing hun- 
 dreds of persons, reported last night that the journeys of many 
 of the employes, particularly girls and women, had so exhausted 
 them that they were not able to work. Even with the regular 
 and emergency bus lines, steamboat schedules, and all the 
 other means of transportation it was estimated last night that 
 not more than one half of the usual north and south travel was 
 carried during the day. Many factories operated with de- 
 pleted forces, and superintendents last night declared that the 
 efficiency of the workers who did reach their desks or machines 
 was lowered by battling with the throngs or by standing up in 
 long rides for more than an hour. 
 
 " Exercising the utmost ingenuity in choosing means of 
 transit, passengers in the Dyckman, Washington Heights, and 
 
 J Aug. 19, 1919.
 
 STRIKES AND THE CONSUMER 199 
 
 other sections at the north of the island, who generally travel 
 to Wall Street in less than an hour, found that they could not 
 make the trip during a ' street car rush hour ' in less than two 
 to three hours. There were many persons who reported that 
 it hacl taken them three hours to reach their offices in the un- 
 usual conditions of traffic. As early as five o'clock in the 
 morning throngs were waiting at One Hundred and Forty- 
 ninth Street and Third Avenue, the Bronx, for cars to convey 
 them to their work in Manhattan. These persons thought that 
 they would get up early and get to their offices without incon- 
 venience by avoiding the crowds. They were mistaken in 
 their judgment, because thousands of others had had the same 
 thought and were there waiting for the few cars that were 
 running at that hour. During the usual rush hour hundreds 
 fought for standing room in the street cars that were departing 
 on irregular schedules from their starting point at One Hun- 
 dred and Eighty-first Street and Broadway. A pouring rain 
 drenched those who had neglected to bring their umbrellas and 
 a brisk wind succeeded in depriving many who had brought 
 them of that means of protection against the rain. Long waits 
 for cars, the heavy rains, and the crowding affected many 
 tempers both in the morning and in the evening, and scores 
 of fist fights were stopped by the police before combatants were 
 able to injure each other. At virtually every one of these 
 traffic points, notably in the Bronx, at One Hundred and 
 Twenty-fifth Street, and in the financial district in the evening, 
 the throngs were almost as large as those seen in Times Square 
 on the night the city was celebrating on the false report that 
 an armistice had been signed."
 
 CHAPTER XIX 
 
 DEMOCRACY IN INDUSTRY 
 
 S '\T 7E cannot go any 'farther in our present direction. We 
 * have already gone too far. We cannot live our right 
 life as a nation or achieve our proper success as an industrial 
 community if capital and labor are to continue to be antag- 
 onistic instead of being partners ; if they are to continue to dis- 
 trust one another and contrive how they can get the better of 
 one another, or, what perhaps amounts to the same thing, 
 calculate by what form and degree of coercion they can man- 
 age to extort on the one hand work enough to make enterprise 
 profitable, and on the other justice and fair treatment enough 
 to make life tolerable. That bad road has turned out a blind 
 alley. It is no thoroughfare to real prosperity." 
 
 This quotation is from President Wilson's message to the 
 extraordinary session of Congress which was cabled from 
 Paris under date of May 20, 1919. It voiced the conclusion to 
 which other thoughtful Americans had come. Continuing, the 
 message further said on this vital question : 
 
 " We must find another, leading in another direction and to 
 a very different destination. It must lead not merely to ac- 
 commodation, but also to a genuine cooperation and partnership 
 based upon a real community of interest and participation in 
 control. There is now, in fact, a real community of inter- 
 est between capital and labor, but it has never been made 
 evident in action. It can be made operative and manifest only 
 in a new organization of industry. The genius of our business 
 men and the sound practical sense of our workers can certainly 
 work such a partnership out when once they realize exactly 
 what it is that they seek and sincerely adopt a common purpose 
 with regard to it." 
 
 200
 
 DEMOCRACY IX INDUSTRY 201 
 
 The President expressed the belief that the new spirit and 
 method of organization which must be effected are not to be 
 brought about by legislation so much as by common counsel 
 and voluntary cooperation of capitalist, manager, and work- 
 man. The organization of industry is a matter of corporate 
 and individual initiative and of practical business arrangement, 
 he said, and those who really desire a new relationship between 
 capital and labor can readily find a way to bring it about. 
 
 " The object of all reform in this essential matter," con- 
 tinued the President's message, " must be the genuine democ- 
 ratization of industry, based upon a full recognition of the 
 right of those who work, in whatever rank, to participate in 
 some organic way in every decision which directly affects their 
 welfare or the part they are to play in industry. Some positive 
 legislation is practicable. The Congress has already shown the 
 way to one reform which should be world-wide, by establish- 
 mg the eight-hour day as the standard day in every field of 
 labor over which it can exercise control. It has sought to find 
 the way to prevent child labor, and will, I hope and believe, 
 presently find it. It has served the whole country by leading 
 the way in developing the means of preserving and safeguard- 
 ing life and health in dangerous industries. It can now help in 
 the difficult task of giving a new form and spirit to industrial 
 organization by coordinating the several agencies of conciliation 
 and adjustment which have been brought into existence by 
 the difficulties and mistaken policies of the present management 
 of industry, and by setting up and developing new Federal 
 agencies of advice and information which may serve as a 
 clearing house for the best experiments and the best thought 
 on this great matter, upon which every thinking man must be 
 aware that the future development of society directly depends." 
 
 This question of labor, said the President, stands at the 
 front of all others in every country amidst the present great 
 awakening. * By the question of labor I do not mean the 
 question of efficient industrial production, the question of how 
 labor is to be obtained and made effective in the great process
 
 202 THE WORKERS AT WAR 
 
 of sustaining populations and winning success amidst com- 
 mercial and industrial rivalries. I mean that much greater 
 and more vital question, How are the men and women who do 
 the daily labor of the world to obtain progressive improvement 
 in the conditions of their labor, to be made happier, and to be 
 served better by the communities and the industries wjiich their 
 labor sustains and advances ? How are they to be given their 
 right advantage as citizens and human beings ? " 
 
 It was with the object of formulating a plan for the work- 
 ing out of these new conditions for the industrial state that 
 President Wilson called a conference for October 6, 1919. 
 In a Labor Day appeal urging the people to continue their 
 support of the Administration in its efforts to reduce the cost 
 of living the President stated that the proposed conference 
 " will discuss fundamental means of bettering the whole rela- 
 tionship of capital and labor and putting the whole question of 
 wages upon another footing." Special consideration was to 
 be given by the conference to the unsatisfactory relations be- 
 tween employes and employers. 
 
 The conference was composed of forty-five representatives 
 divided into three groups of fifteen members each, representa- 
 tives of industry, business, finance, and agriculture forming one 
 group, representatives of organized labor another, and repre- 
 sentatives of the public a third. The fifteen representatives 
 of the first mentioned group were selected as follows: Five 
 by the National Industrial Conference Board, five by the United 
 States Chamber of Commerce, two by the Investment Bankers' 
 Association, one by the American Society of Equity, one by 
 the National Grange, and one by the National Farmers' Union. 
 The fifteen representatives of organized labor were named by 
 the president of the American Federation of Labor. President 
 Wilson was to name the fifteen representatives of the public 
 but the selection of these fell into other hands owing to his 
 ill-health. 
 
 This indisposition of the President was most unfortunate 
 from every point of view in its disastrous effects upon the work
 
 DEMOCRACY IX INDUSTRY 203 
 
 of the conference. It assembled after his illness began and 
 was without his assistance in giving direction to its proceedings, 
 was without a program, and was without any definite policy. 
 Its sessions were too public and at the very outset became the 
 football of group antagonisms. But more even than all this, 
 the personnel of the three groups as they were finally formed 
 foretold, at the very outset to any one in the least familiar 
 with the practical every-day labor problem, that no good could 
 ever come out of such an assemblage in so far as accomplish- 
 ing anything constructive was to be expected. The so-called 
 public group very inadequately if at all represented the real 
 economic interests of consumers, and if they did not distinctly 
 represent clearly these interests there was no reason for their 
 selection. They were high-minded, public-spirited citizens but 
 these were not sufficient qualifications. One of these represen- 
 tatives of the public was a prominent manufacturer, another 
 was the executive head of the United States Steel Corpor- 
 ation, still another was a representative of the Standard Oil 
 and the Colorado Fuel and Iron Company ; one was a Socialist ; 
 still others were official heads of national labor unions. These 
 representatives of the public represented every economic inter- 
 est in the industrial trilogy but that of the consumers. This 
 was the one interest unrepresented that most emphatically was 
 entitled to representation. The details of the sessions of the 
 conference are merely accounts of disagreements rather than of 
 agreements, and about the only good that came out of it was its 
 failure. 
 
 This failure, inevitable at the outset, finally came over the 
 question of joint or collective bargaining. Both the public and 
 the labor group agreed to the principle as thus expressed: 
 " The right of wage earners to organize in trade and labor 
 unions, to bargain collectively, to be represented by represen- 
 tatives of their own choosing in negotiations and adjustments 
 with employers and in respect to wages, hours of labor, and 
 relations and conditions of employment, is recognized. This 
 must not be understood as limiting the right of any wage earner
 
 204 THE WORKERS AT WAR 
 
 to refrain from joining any organization, or to deal directly 
 with his employer, if he so chooses." To this formulation of 
 collective bargaining the employers group refused to agree, 
 although its members were divided on the issue in the separate 
 conferences among themselves. 
 
 There was no disagreement among the three groups as to 
 " the right of wage earners to organize or not to organize in 
 trade and labor unions, or some form of shop industrial 
 councils." There was no disagreement as to " the right of 
 employers and employes to bargain collectively, in respect to 
 wages, hours of labor, and rules and conditions of employ- 
 ment." All three agreed " for the purpose of so bargaining 
 collectively " in " the right of representation of wage earners." 
 There was also agreement by all three groups in recognizing 
 " the right of wage earners to be represented by representa- 
 tives chosen by the majority of their own number." 
 
 But when an attempt was made to place an interpretation on 
 the practical meaning of this recognition of industrial " rights " 
 to the effect that " this must not be understood as limiting the 
 right of any wage earner to refrain from joining any organiza- 
 tion or to deal directly with his employer if he so chooses," 
 the representatives of the employer group declined to agree. 
 Instead, they submitted the following declaration of principle: 
 " The right of employer and employe to negotiate individually 
 in respect to wages, hours of labor, and rules and conditions of 
 employment is recognized." 
 
 The labor group submitted their formulation of the principle 
 of collective bargaining as follows : " The right of wage earn- 
 ers to organize without discrimination, to bargain collectively, 
 to be represented by representatives of their own choosing in 
 negotiations and adjustments with employers in respect to 
 wages, hours of labor, and relations and conditions of employ- 
 ment is recognized." This was approved by the public group 
 but approval was withheld by the employer group. 
 
 Under the rules adopted for the guidance of the conference 
 unanimous consent was required, and in consequence of this
 
 DEMOCRACY IX INDUSTRY 205 
 
 defeat of the principle of collective bargaining as proposed by 
 the labor group, its representatives withdrew from further 
 participation in the conference. President Wilson then dis- 
 missed the employer group and requested the public group to 
 continue in conference to work out alone an industrial pro- 
 gram. This group finally adjourned October 24 without ac- 
 complishing results other than to recommend the calling of 
 another conference to consist of only fifteen members and these 
 representing solely the public. 
 
 The conference was a failure primarily because a powerful 
 and influential group of employers of labor had previously de- 
 termined upon a policy of opposition to the demands of the 
 labor unions and to the labor policy of the Wilson Administra- 
 tion during the war, and it was the representatives of these 
 employers that dominated the employer group in the confer- 
 ence. They had decided upon a test of strength with or- 
 ganized labor to determine what principles shall govern in the 
 industrial state they have in the most literal sense thrown 
 down the gauge of battle to the organized workers. There 
 were indications of this all during the sessions which prevented 
 any understanding being arrived at between the three groups 
 as to the formulation of industrial principles of future rela- 
 tions. This decision of the employers was so clearly the fact 
 that representatives of the labor group very early in the ses- 
 sions saw ahead of them nothing less than a protracted period 
 of industrial warfare to establish their principles. This was 
 impressed upon them in the attitude taken by representatives of 
 this dominant group in the strike of the employes of the 
 United States Steel Corporation which was in progress while 
 the conference was in session. 
 
 So unmistakenly was this the prospect as seen by the labor 
 leaders that upon the breaking up of the conference represen- 
 tatives of all the national unions in the country were summoned 
 to Washington by the American Federation of Labor and the 
 railway brotherhoods. These drew up a statement to the pub- 
 lic as to the policy organized labor was to pursue in the bitter
 
 2o6 THE WORKERS AT WAR 
 
 contest the leaders saw ahead of them. The statement de- 
 clared the " fundamental principles " upon which organized 
 labor would combat " grave dangers affecting the very founda- 
 tion of its structure " in order '' to safeguard and promote 
 the rights, interests, and freedom of the wage earners." These 
 principles were a reiteration of those contained in labor's re- 
 construction program as drawn up by a committee of the 
 American Federation of Labor appointed by the St. Paul, 
 Minnesota, convention in June, 1918. Says this program: 
 
 " The world war has forced all free peoples to a fuller and 
 deeper realization of the menace to civilization contained in 
 autocratic control of the activities and destinies of mankind. It 
 has caused a world-wide determination to overthrow and 
 eradicate all autocratic institutions, so that a full measure of 
 freedom and justice can be established between man and man 
 and nation and nation. It has awakened more fully the con- 
 sciousness that the principles of democracy should regulate the 
 relationship of men in all their activities. It has opened the 
 doors of opportunity through which more sound and progres- 
 sive policies may enter. New conceptions of human liberty, 
 justice and opportunity are to be applied. The American 
 Federation of Labor, the one organization representing Labor 
 in America, conscious that its responsibilities are now greater 
 than before, presents a program for the guidance of Labor, 
 based upon experience and formulated with a full conscious- 
 ness of the principles and policies which have successfully 
 guided American trade unionism in the past." 
 
 Under the title " Democracy in Industry " the program says : 
 
 " Two codes of rules and regulations affect the workers ; 
 the law upon the statute books, and the rules within industry. 
 The first determines their relationship as citizens to all other 
 citizens and to property. The second largely determines the 
 relationship of employer and employe, the terms of employ- 
 ment, the conditions of labor, and the rules and regulations 
 affecting the workers as employes. The first is secured through 
 the application of the methods of democracy in the enactment 
 of legislation, and is based upon the principle that the laws 
 which govern a free people should exist only with their con- 
 sent. The second, except where effective trade unionism ex-
 
 DEMOCRACY IN INDUSTRY 207 
 
 ists, is established by the arbitrary or autocratic whim, desire 
 or opinion of the employer and is based upon the principle that 
 industry and commerce cannot be successfully conducted unless 
 the employer exercises the unquestioned right to establish such 
 rules, regulations and provisions affecting the employes as 
 self-interest prompts. 
 
 " Both forms of law vitally affect the workers' opportuni- 
 ties in life and determine their standard of living. The rules, 
 regulations and conditions within industry in many instances 
 affect them more than legislative enactments. It is, there- 
 fore, essential that the workers should have a voice in deter- 
 mining the laws within industry and commerce which affect 
 them, equivalent to the voice which they have as citizens in 
 determining the legislative enactments which shall govern them. 
 
 " It is as inconceivable that the workers as free citizens 
 should remain under autocratically made law within industry 
 and commerce as it is that the nation could remain a democracy 
 while certain individuals or groups exercise autocratic powers. 
 It is, therefore, essential that the workers everywhere should 
 insist upon their right to organize into trade unions, and that 
 effective legislation should be enacted which would make it a 
 criminal offense for any employer to interfere with or hamper 
 the exercise of this right or to interfere with the legitimate 
 activities of trade unions." 
 
 The field of endeavor of the trade union and the objects it 
 aims to secure are discussed in detail in the reconstruction pro- 
 gram under such headings as unemployment, wages, hours of 
 labor, women as wage-earners, child labor, status of public em- 
 ployes, cooperation, the people's final voice in legislation, po- 
 litical policy, government ownership, water ways and water 
 power, regulation of land ownership, federal and State regula- 
 tion of corporations, freedom of expression and association, 
 workmen's compensation, immigration, taxation, education, 
 private employment agencies, housing, and militarism. 
 
 Under the claim of industrial democracy the railway broth- 
 erhoods launched an extensively organized campaign in 1910 
 against the return of the railroads by the Government to private 
 operation. The Plumb Plan League was organized, a weekly 
 newspaper, " Labor," published, a lecture and public speakers'
 
 208 THE WORKERS AT WAR 
 
 bureau put to work on propaganda, and a widespread move- 
 ment created among the organized wage earners in favor of a 
 so-called tripartite plan of railway control under Government 
 ownership in which the wage earners on the railroads had 
 representation in the board of directors. Briefly, this plan 
 provides, in a bill introduced in Congress, for the acquisition 
 by Government bond issues of complete ownership by the Fed- 
 eral Government through the National Railways Operating 
 Corporation, created for the purpose, of all railway property in 
 the United States under compensation to be determined by the 
 Railways Board of Appraisement and Extension, also created 
 in the bill for this particular purpose. The Operating Corpora- 
 tion was to be administered by a board of directors of fifteen 
 members selected in the following manner: " Five of the di- 
 rectors shall be elected by the classified employes of the railway 
 lines and properties of the United States and its possessions 
 below the grade of appointed officials ; five of the directors 
 shall be elected by the official employes of said lines and prop- 
 erties ; and five, of whom one shall be designated as chairman, 
 shall be appointed by the President of the United States, by 
 and with the advice and consent of the Senate ; not more than 
 three of said appointees shall belong to one political party, 
 That the members of each group of five directors shall be 
 elected and appointed, respectively, for terms of two, four, six k 
 eight, and ten years each, their terms thereafter overlapping 
 and for ten years each. The elected directors shall be subject 
 to recall by their electors and the appointed directors to re- 
 moval by the President for inability or misconduct." l 
 
 The territory of the United States and its possessions was to 
 be divided into operating districts and in each district a rail- 
 way council constituted as follows : " One-third of the mem- 
 bers of the council shall be elected by the classified employes 
 within their district below the grade of official employes, one- 
 third of the council shall be elected by the official employes 
 within said district, and one-third, of whom one shall be desig- 
 
 1 Section I, Article 2, of the so-called Esch bill.
 
 DEMOCRACY IN INDUSTRY 209 
 
 nated as chairman, shall be appointed by the board of di- 
 rectors." 1 The board " may delegate to any district railway 
 council such of their powers under this act as may conven- 
 iently be exercised locally, and the district railway council shall, 
 upon such delegation, have and exercise within its district all 
 of the powers and duties of the board of directors as may be 
 delegated to it." 1 
 
 1 Section 3, Article 2 of the Esch bill.
 
 CHAPTER XX 
 
 THE THREE PARTIES TO PRODUCTION 
 
 ' I **HE nature of the conflict between the wage worker and 
 * the capitalist-producer over the division of the proceeds 
 of industry as viewed by leaders of the workers is clearly set 
 forth by Mr. Warren S. Stone, grand chief of the Brother- 
 hood of Locomotive Engineers, in testimony before the Com- 
 mittee on Interstate and Foreign Commerce of the House of 
 Representatives, 1 in support of the demand of the railway 
 brotherhoods for employe representation in the board of di- 
 rectors of the railroad corporation. Mr. Stone explained the 
 fundamental purpose of organized workers as being " to secure 
 better working conditions and a larger measure of return for 
 their labor." But in their efforts to attain these objects " the 
 full force of capitalistic organizations has been set against labor 
 to hold and to keep all the profits of industry. The strength 
 of the labor unions has been exerted to wrest from capital 
 some share of the profits for the wage earners. 
 
 " This has been a perpetual struggle by the workers to main- 
 tain a tolerable standard of existence ; on the part of capital, 
 to amass greater profits. At times, both sides could ignore the 
 needs of the public. But now the very growth of the labor 
 organizations has brought into their ranks a great mass of 
 the consumers. The large number of the wage earners now 
 constitute a large percentage of the people. The extension of 
 industry has changed the nature of the previous struggle. For 
 whatever the worker receives in wages he must spend for the 
 necessaries of life. In addition, he is always compelled to pay 
 
 1 Hearings on Return of the Railroads to Private Ownership, Sixty- 
 sixth Congress, First Session, H. R. 4378, August 20-27, 1919, Plumb 
 Plan Testimony. 
 
 210
 
 THE THREE PARTIES TO PRODUCTION 211 
 
 to the employer an excessive profit on his own wages. The 
 cost of his living is determined by the sum he earns, plus the 
 profits he is charged on his own labor. And as a group, labor 
 is forever prevented from bettering its lot because of the profits 
 exacted by the employer. The hope of a finer life is never 
 realized. So long as consumers are forced to pay extortionate 
 profits on their own earnings to a third interest there is no 
 solution of the industrial problem. 
 
 " We find that this third interest absolutely controls and 
 dominates the management of industry. It fixes wages and 
 controls working conditions. It fixes the prices of commodities 
 without regard to the needs of society, or the necessities of 
 producers and consumers. 
 
 " We have a democratic form of government but an auto- 
 cratic control of industry. We exist under government, but 
 by industry we live. Under such a system the majority of a 
 democracy can, through their government, enjoy only such 
 rights and privileges as an autocracy in industry permits them 
 to receive. 
 
 " This country was peopled by a race who sought within 
 its boundaries religious freedom. It was established by their 
 descendants through revolution as a land of political freedom. 
 We now demand that it become the home of industrial free- 
 dom." Mr. Stone expressed the belief that this could " only 
 be accomplished by extending to industry the same right of in- 
 dividual freedom recognized by the founders of our Govern- 
 ment in establishing this democracy. The need of mankind 
 for the products of industry must be accepted as the basic in- 
 terest in all industry. The right of the worker who supplies 
 that need demands like acceptance. This can only be achieved 
 by permitting producers and consumers to share in the control 
 of the management of their means of existence." 
 
 This presentation of the situation by the leader of one of 
 the most powerful and at the same time conservative labor 
 organizations of the country is deeply significant. It reflects 
 the fact that the more advanced representatives of organized 
 labor believe that further increases in wages without control 
 over the transfer of these increases to the prices of the com- 
 modities that enter into the daily life of the workers, mean no 
 permanent advance to the wage worker. Therefore organized
 
 212 THE WORKERS AT WAR 
 
 labor must strike out for a greater degree of control over 
 the power that fixes prices just as by past endeavor it has se- 
 cured part control at least over the power to fix wages. The 
 interest of the worker is in the price of the things he 
 buys with his wages as much as it is in those wages. 
 Heretofore organized labor has emphasized increases in 
 wages with but little if any thought of what those wages 
 would exchange for. It has been too much concerned 
 with money wages and too little interested in real wages in 
 the food, clothing, shelter, and so on which the money wages 
 purchase. And after all the real progress of the organized 
 labor movement and the economic welfare of its individual 
 members is measured in terms of real and not money wages. 
 
 This concept of the economics of wages and of the labor 
 movement links the interest and welfare of the wage worker 
 with that of the consumer. It recognizes that in the product 
 of every industry, whether this product is a commodity or a 
 service, there are three groups in society that have a vital, 
 economic interest in the processes of production, distribution, 
 and consumption. These three groups are the consumer who 
 pays the price for the commodity or service, the capitalist whose 
 money is invested, and the worker who supplies the labor. 
 
 There are three basic interests in every socialized industry, 
 says Mr. Glenn E. Plumb, counsel for the railway brother- 
 hoods, in his testimony before the Committee on Interstate and 
 Foreign Commerce of the House of Representatives of the 
 Sixty-sixth Congress. 1 By socialized industries Mr. Plumb 
 does not mean ownership or control by the Government but 
 those that are based on either a grant from the Government 
 or a privilege of monopolistic nature. He does not include in- 
 dustries carried on by individuals under the competitive sys- 
 tem without the aid or grant of privilege. By " socialized '" 
 he means industries which require great aggregations of work- 
 ers, each performing a small fraction of the task of production 
 and in which the finished product is the result of combined co- 
 
 1 Hearings, First Session, on H. R. 4378, August 20-27, 1919, Part 5.
 
 THE THREE PARTIES TO PRODUCTION 213 
 
 operative productive effort. " I deem that an industry is soc- 
 ialized," he says, " when it can only be carried on by a grant 
 of society and by organizations which eliminate individual ef- 
 fort or competition. It is a function of society when it has 
 reached that development, regardless of its ownership of man- 
 agement, and it is in that sense and that sense alone that I 
 speak of ' socialized ' industries." 
 Says Mr. Plumb : 
 
 " The first interest is that of the public, which I define as 
 the demand of the public for the products of that industry. It 
 is the need of society for those things essential to its exist- 
 ence which are produced alone by the organized, socialized, pro- 
 ductive efforts of those engaged in meeting this demand. 
 Without the existence of this demand of society, that industry 
 could not exist ; without this demand capital would have no 
 field for investment, labor would have no opportunity for em- 
 ployment. With either one of these three fundamental inter- 
 ests lacking the other two could not exist within that field of 
 production. 
 
 " The second interest is the interest of capital. Capital is 
 nothing but the unexpended surplus of past human effort which 
 is now available to furnish the tools for present human effort. 
 It is essential to every organized industry in that it furnishes 
 the tools for production without which the demand of society 
 for the products of industry could not be satisfied and with- 
 out which labor or human effort could not find employment. 
 
 " The third fundamental interest is that of the wage earner 
 or producer. It includes all those employed in productive ef- 
 forts in those industries which have been socialized. That in- 
 cludes not only the man who works with his brawn, but the 
 man who works with his brain all productive effort in that 
 industry. This constitutes the third interest which I have 
 termed the interest of the wage earner. The wage earner rep- 
 resents the human effort which must be applied to these means 
 for production, without which capital could not find investment 
 and secure its returns and without which the needs of society 
 for the products of industry could not be satisfied. 
 
 " These are the three fundamental interests in industry, each 
 as essential -to the existence of industry as the other. There- 
 fore they are equal and must have equal opportunity, protec- 
 tion, and authority."
 
 2i 4 THE WORKERS AT WAR 
 
 Viewed from the welfare of each of these economic groups 
 which combined comprise all members of society, the funda- 
 mentals of the distribution of the proceeds of production should 
 be a fair return to the owners of capital, a fair wage to the 
 possessors of labor, and a fair price to the consumers of the 
 commodity or service. Production should be so organized that 
 the attainment of any two of these objects automatically pro- 
 duces the third. That is, a fair interest or dividend and a fair 
 wage should of themselves in combination result in a fair 
 price ; a fair interest or dividend return and a fair price should 
 of themselves in combination result in a fair wage ; and a fair 
 price and a fair wage should of themselves in combination 
 result in a fair return to capital in interest or dividends. Pro- 
 duction organized on such a basis would secure and assure 
 economic justice to the individual citizens in all three groups. 
 
 The great obstacle to the attainment of this much to be de- 
 sired end is the widespread violation of the prime essential of 
 honest corporate organization and financing of industries en- 
 gaged in production. This essential is accurate and trust- 
 worthy information as to the actual true capital investment of 
 money and services. Instead of the finances showing this, in 
 all too many cases the true capital investment is arbitrarily in- 
 creased by paper capitalization and hidden or concealed by 
 corporate organization and similar methods to such an extent 
 that it is not possible to ascertain what is a fair return to the 
 capital actually invested and in turn to any one of the other 
 two elements to production. If, for example, with the finances 
 showing a capitalization of, say, ten million dollars where only 
 one million dollars of money and services are actually invested 
 and with a dividend or interest return paid on the ten million, 
 there cannot be a fair return on capital, a fair wage, and a 
 fair price every one of the three is most likely to be unfair. 
 If, through holding and subsidiary companies, the bookkeeping 
 entries or charges are manipulated so as to falsify or conceal 
 the actual transactions, there can be no basis for the determina- 
 tion of the share of each of these three factors in productioa
 
 THE THREE PARTIES TO PRODUCTION 215 
 
 So at the very outset it is impossible, for any industry thus cap- 
 italized and organized to supply the essential elements of fair- 
 ness. 
 
 The cost of management in salaries to executives, superin- 
 tendents, managers, and so on, which might be considered as a 
 fourth factor in production separate and distinct from either 
 capital or labor is here treated as a part of labor ; it can with 
 equal regard for the facts be treated as a part of capital cost. 
 
 Beginning in 1910 the four railway brotherhoods whose 
 members are engaged in the operation of trains, directed con- 
 certed movements for increases in wages against large groups 
 of railroads in the three territorial divisions, that is, the South- 
 ern, Eastern, and Western territories. The principal line of 
 defense of the transportation corporations in opposition to the 
 demands of their employes for higher wages and shorter hours 
 of work was their claim of " inability to pay." So persistent 
 was this claim down to 1913 without specific proof of the asser- 
 tion other than the formal presentation, before arbitration 
 boards appointed by the President of the United States, of their 
 " property investment " and " capital obligations " accounts as 
 taken from the reports of the companies to the Interstate Com- 
 merce Commission, and so insidious was its effect upon mem- 
 bers of the board, with a terrifying and confusing array of sta- 
 tistical tables showing alleged fixed charges which must be met 
 if bankruptcy was to be avoided, that two of the railway broth- 
 erhoods determined upon an ascertainment of the facts if it 
 were possible to ascertain those facts. 
 
 For eight months a most exhaustive investigation was made 
 by a staff of experts. The so-called " property investment " 
 account of all the important railway systems of the United 
 States was analyzed. Their intercorporate relations through 
 stock ownership were also established and the effects of these 
 relations upon the finances of the companies shown. Their 
 so-called " capital obligations " account was gone into thor- 
 oughly ; also the interrelation of all these companies with each 
 other and with industrial and financial corporations and supply
 
 216 THE WORKERS AT WAR 
 
 companies by means of interlocking directorates and stock own- 
 ership by individual railway officials. No ascertainable fact 
 that would throw light on the confusing, complex, and com- 
 plicated situation was ignored. And when in 1913 the con- 
 certed wage movement of the Order of Railway Conductors 
 and Brotherhood of Railroad Trainmen against the leading 
 railways of the Eastern Territory came before the board of 
 arbitration appointed by President Taft to settle the contro- 
 versy, all this mass of data was presented before this board 
 in statistical tables, charts, text explanations, and in the oral 
 testimony of an expert witness. The Eastern railroads stated 
 for the first time that they did not claim " inability to pay." 
 
 The sum and substance of this investigation is to condemn 
 as worthless, the so-called " property investment " account as it 
 appears today on the books of these transportation corpora- 
 tions. The same is true as to the alleged " capital obligations " 
 account of these companies it is worse than useless as a fair 
 measure of ascertaining the securities that have a just claim 
 upon the earnings of the railroads ; it is actually misleading. 
 These statements are verified by numerous rulings and find- 
 ings of the Interstate Commerce Commission. 
 
 This, then, is the situation today with regard to the " of- 
 ficial " statements of the railroads of the country as to the 
 basis of their elaborate financial structure. This basis is un- 
 just, unsound, and misleading, not to apply harsher terms. 
 Consequently the railway employes have not the slightest con- 
 fidence in the financial statements of railway corporations 
 the employes in their wage demands absolutely refuse to take 
 into consideration any claims of the officials as to the corpora- 
 tions' finances. This, in turn, has resulted in these wage earn- 
 ers objecting to the reports as in any honest degree reflecting 
 the actual facts and declining to accept them as a basis for 
 determining " the ability to pay " the higher wages and the cost 
 of improved conditions of employment demanded of the in- 
 dustry. Such accounts make it next to impossible for arbitra- 
 tion boards to render intelligent and just decisions in wage
 
 THE THREE PARTIES TO PRODUCTION 217 
 
 cases. Perhaps this is one of the reasons why arbitration 
 through the intervention of the National Government no longer 
 has the confidence of the railway employes. From the side of 
 prices, in the case of railroads taking the form of transporta- 
 tion rates for services, the Interstate Commerce Commission 
 finds such accounts so unreliable as a basis for the determina- 
 tion of what are reasonable rates that it refuses to take them 
 into consideration in this connection. 
 
 This is the situation that exists with regard to the finances 
 of our railroads whose accounts, many of which are still in- 
 accurate notwithstanding they are now kept according to rules 
 prescribed by the Interstate Commerce Commission, are regu- 
 larly inspected and are far more subject to governmental au- 
 thority than the accounts of other corporations. What is fairly 
 to be expected as to the finances and practices of corporations 
 that are absolutely free in the adoption and employment of such 
 methods? Some concept of the conditions can be gained from 
 a perusal of the findings of the Commission in the notorious 
 looting of the New Haven, the Rock Island, the Pere Marquette, 
 the Cincinnati, Hamilton and Dayton, the Chicago and Alton, 
 the St. Louis and San Francisco, and other roads generally 
 regarded by the public as under government supervision be- 
 cause of the mistaken idea of the extent of the jurisdiction of 
 the Interstate Commerce Commission. These findings present 
 a most disgraceful record of practices that are really nothing 
 less than the robbery and theft of values that belong to the 
 people. The fact it is desired to make plain here is that there 
 is such widespread misuse of the legitimate principles of cor- 
 porate organization and finance that only in exceptional cases 
 of large industrial enterprises is it possible to ascertain from 
 their accounts the essential facts in order to arrive at a just 
 determination of a fair return to capital, a fair wage to labor, 
 and a fair price to the consumer. 
 
 The American workingman, then, is justifiably suspicious of 
 the financial practices of industrial corporations as to their in- 
 vestments and earnings. He will never be content with any
 
 2i8 THE WORKERS AT WAR 
 
 so-called " profit sharing " plan so long as corporation finances 
 absorb by unjust capitalization methods a huge proportion of 
 the earnings over and above those properly due to the capital 
 invested. Such a practice verges close to actual fraud and ex- 
 plains in part why the American workingman "has received so- 
 called profit sharing schemes with suspicion. Until a financial 
 and corporate organization is effected in American industries 
 that will represent the facts of investment as they actually exist, 
 the workers will continue to ignore the alleged financial state- 
 ments of these industries. One of the very first reforms neces- 
 sary in these days of moral awakening as to rights and justice 
 in the industrial world is the abandonment of past and present 
 financial and corporate methods, based on forced profits 
 through high prices over and above a legitimate return for the 
 service performed, and the substitution of others that show the 
 actual facts in relation to production for social service. Then, 
 and then only, will profit sharing, stock ownership by employes, 
 participation in management by the workers, and like economic 
 appeals possess for the workers the attractions inherent in 
 their principles. 
 
 But the situation is even more serious. The methods and 
 practices of industrial autocracy affect not alone the wage 
 workers but all consumers.
 
 INDUSTRIAL autocracy operates through the corporation. 
 If we are to understand clearly autocracy's methods and 
 practices that are injurious to the economic interests of the 
 wage worker and the consumer we must examine the operation 
 of the corporation. But these methods and practices are so 
 general throughout the industrial state and they are manifested 
 in so many different ways that it is not possible, within the 
 limited space at our disposal, to indicate completely their nature 
 and characteristics. All that can be done is to present very 
 brief summaries from official government reports. For this 
 purpose the records of the Interstate Commerce Commission 
 are selected and those, too, of only a single corporation, but it 
 is not to be inferred that these practices are confined to this 
 particular transportation company or solely to railway cor- 
 porations. From the Commission's reports on the financial and 
 other transactions of the New York, New Haven and Hart- 
 ford Railroad Company, 1 which transactions resulted in the 
 financial wrecking of that great transportation system, extracts 
 will suffice to give a general idea of the methods employed by 
 the autocracy in control of our industrial state. Quotations 
 are the exact wording of the Commission's statements. 
 
 Evidence of wrongdoing such as was disclosed in this in- 
 vestigation is difficult to obtain. Men do not conduct such 
 transactions in the open, but rather in secret and in the dark. 
 Only those individuals involved, as a rule, have direct informa- 
 
 1 1. C. C. No. 6569 Financial Transactions of the New York, 
 New Haven & Hartford Railroad Company. Also 27 I. C. C., 560, 
 New England Investigation. 
 
 219
 
 220 THE WORKERS AT WAR 
 
 tion. So some of the evidence, of necessity, must come 
 through participants. And in securing such evidence im- 
 munity against criminal prosecution has to be extended to some 
 of those incriminated. Ordinarily, too, in investigations by 
 the Commission evidence is easily adduced by placing witnesses 
 upon the stand, but in this instance the witnesses, other than 
 the accountants for the Commission, were in the main hostile, 
 and with few exceptions their testimony was unwillingly given. 
 One witness to whom payments of many thousands of dollars 
 had been made in a transaction for which there were no item- 
 ized vouchers " left for Europe after this investigation was 
 commenced, and his evidence could not be secured." 
 
 In its search for the truth not only did the Commission have 
 to overcome the obstinacy of witnesses who declined to testify 
 until criminal proceedings were begun for their refusal to 
 answer questions, but it also encountered obstacles purposely 
 placed in its way, such as the burning of records, books, let- 
 ters, and documents. " J. L. Billard purposely burned his 
 books and papers so as to get them out of the way." " This 
 transaction (referring to the purchase by the New Haven of 
 trolleys from the Rhode Island Securities Company) seems an 
 extravagant purchase and makes it a matter of interest just 
 who owned the securities of the Rhode Island Securities Com- 
 pany. This information could be furnished from the stock 
 books of that company, but during the progress of this investi- 
 gation it was learned that these books had also been burned." 
 There was additional evidence as to the destruction of still 
 other records. 
 
 The New Haven system had more than three hundred sub- 
 sidiary corporations " in a web of entangling alliances with 
 each other, many of which were seemingly planned, created, 
 and manipulated by lawyers expressly retained for the purpose 
 of concealment or deception." 
 
 The financial operation necessary for these acquisitions (re- 
 ferring to steamship and trolley lines acquired by the New 
 Haven) and the losses which they have entailed, have been
 
 INDUSTRIAL AUTOCRACY AND CONSUMER 221 
 
 skillfully concealed by the juggling of money and securities 
 from one subsidiary corporation to another. 
 
 The story of the companies through which the property of 
 the Metropolitan Steamship Company, operating between New 
 York and Boston, passed " under the direction of Mr. Rob- 
 bins, the general counsel for the New York, New Haven and 
 Hartford Railroad Company, is indeed a remarkable exhibi- 
 tion of corporate legerdemain. . . . Witnesses who were of- 
 ficers of some of these companies appeared before the Com- 
 mission and testified that they acted as ' dummies ' under the 
 direction of Robbins and of attorneys selected by him. Some 
 of them handled, without any knowledge of the nature or 
 purpose of the transactions, checks approximating three million 
 dollars." 
 
 "The devious methods used, the tangled web. of corporate 
 transactions through which this property (the Metropolitan 
 Steamship Company) passed and the use of ' dummies,' who 
 knew nothing of the purposes for which they were being 
 used, all clearly indicate that the purpose of these circuitous 
 methods was to conceal the hand of the New Haven. The 
 names of the men who vouched for the ' dummy ' treasurer, 
 Richards, and who undoubtedly furnished the money which 
 at the inception of this transaction he was blindly using, also 
 seem to point to the New Haven." Thus in the acquisition of 
 the numerous steamship lines that ply between several of the 
 large cities served by the New Haven system " dummy com- 
 panies and dummy officers and directors were used in financial 
 maneuvering that resulted in the New Haven controlling those 
 steamships." 
 
 Increases in capital stock of the New Haven were made upon 
 the basis of transfers of assets from one subsidiary company to 
 another. The steamship properties of this system at one time 
 were held by the New England Navigation Company, approxi- 
 mating a cost of $11,500,000. This latter company transferred 
 the title of these steamship properties to another subsidiary 
 company, the Consolidated Railway Company, at a value of
 
 222 THE WORKERS AT WAR 
 
 $20,000,000. The Consolidated Company thereupon increased 
 its capital stock $20,000,000. The latter company was then 
 merged with the New Haven, and the stock of the New Haven 
 increased $30,000,000, $20,000,000 of which went to the New 
 England Navigation Company, and placing in its treasury by 
 this transaction $20,000,000 Consolidated Railway stock, which 
 by the merger became New Haven stock, with a market value 
 of over $30,000,000. 
 
 Domination of the Boston and Maine Railway was secured 
 with apparent ease to the New Haven " without any expendi- 
 ture " and simply " by inducing an exchange of the Boston and 
 Maine stock owned by the American Express Company for 
 New Haven stock." Thus by a mere exchange of stock those 
 controlling the New Haven were enabled to extend their domi- 
 nation over almost the entire railroad property in five States. 
 Those who at first were merely employed as fiscal agents of the 
 railroad to negotiate its securities used that knowledge in the 
 effort to become the masters in supreme control of the trans- 
 portation of the country. This is an illustration of what has 
 been a most dangerous tendency in recent years. 
 
 Among the marked features and significant incidents in the 
 " loose, extravagant, and improvident administration of the 
 finances of the New Haven as shown in this investigation " 
 are the following : 
 
 The Boston and Maine despoilment. 
 
 The iniquity of the Westchester acquisition. 
 
 The double price paid for the Rhode Island trolleys. 
 
 The recklessness in the purchase of Connecticut and Massa- 
 chusetts trolleys at prices exorbitantly in excess of their 
 market value. 
 
 " The retention by John L. Billard of more than $2,700,000 in 
 a transaction in which he represented the New Haven and 
 into which he invested not a dollar." 
 
 "The inability of Oakleigh Thorne to account for $1,032,000 
 of the funds of the New Haven intrusted to him in carry- 
 ing out the Westchester proposition." 
 
 The Westchester transaction is a story of the profligate waste 
 of corporate funds.
 
 INDUSTRIAL AUTOCRACY AND CONSUMER 223 
 
 " The vote appointing this committee (directors Morgan, 
 Rockefeller, and Miller, with President Mellen as chair- 
 man) is ambiguous and was evidently intended to con- 
 ceal a secret purpose. The full board was not taken into 
 the confidence of those directors who wanted these securi- 
 ties purchased." 
 
 " No comment is necessary to make clear to the mind the cor- 
 rupt and unlawful nature of this transaction, and it would 
 seem that the amount illegally expended could be recov- 
 ered from Mr. Mellen and the directors who authorized 
 it." 
 
 " It appears that of the moneys disbursed by Perry and 
 Thorne, $1,423,000 remains to be accounted for by 
 them." 
 
 " The blame for the Westchester (involving the squandering 
 of more than $36,000,000 of the moneys of the New Haven 
 stockholders) rests squarely upon the directors of the New 
 Haven road. Some are guilty for acts permitted; others, 
 the greater number, for their failure to act. They are 
 alike culpable and responsible to the stockholders." 
 
 The result of the transaction with regard to the acquisition of 
 trolley lines was to enable the United Gas Improvement 
 Company to realize par value on securities amounting to 
 $19,899,000 of debentures which represented an investment 
 of approximately only $6,000,000 and based merely upon 
 lively expectation of future possibilities, thereby immedi- 
 ately placing the burden of watered stock upon the backs 
 of the New Haven stockholders. The millions that were 
 made from this transaction did not come through magic, 
 but were brought into existence at the expense of the stock- 
 holders of the New Haven, upon whom and the public the 
 yoke of giving value to these securities ultimately rests, 
 and the New Haven stock was diluted to the extent of the 
 water thus added. 
 
 Purchases of cars and coal are two large expenditures that 
 railroads make. " The New Haven purchased cars almost 
 exclusively from James B. Brady without competition and 
 to the extent of some $37,000,000. Mr. Brady, as a wit- 
 ness, made no secret of his generosity to the officials with 
 whom he had business." 
 
 Locomotives were purchased from the company in which a 
 director of the New Haven was also a director. 
 
 Many supplies obtained by the New Haven were from com-
 
 224 THE WORKERS AT WAR 
 
 panics having directors who were also directors of the New- 
 Haven. 
 
 There was the habitual payment of unitemized vouchers with- 
 out any clear specification of details. 
 
 There was the confusion of interrelation of the principal com- 
 pany and its subsidiaries and the consequent complication 
 of accounts. 
 
 Proper accounting demands that the records of a company 
 should reflect accurately the transactions relating to the 
 matter recorded, and where accounts fail to reveal a true 
 history of the transactions it can be due to but one of two 
 causes carelessness or design. Several transactions ap- 
 pear of record " which show that by no stretch of imagina- 
 tion can the irregularity of recording be classified as due 
 to carelessness." 
 
 The practice of financial legerdemain in issuing large blocks of 
 New Haven stock for notes of the New England Naviga- 
 tion Company, and manipulating these securities back and 
 forth. 
 
 Fictitious sales of New Haven stock to friendly parties with 
 the design of boosting the stock and unloading on the 
 public at the higher " market price." 
 
 The unwarranted increase of the New Haven's liabilities from 
 $93,000,000 in 1903 to $417,000,000 in 1913. 
 
 The increase in floating notes from nothing in 1903 to approxi- 
 mately $40,000,000 in 1913. 
 
 The loss of $2,748,700 growing out of the so-called Billard 
 transaction. That Billard was merely a tool of the New 
 Haven in transactions where he was involved is shown by 
 the following facts which stand out glaringly in the rec- 
 ord of attempted evasions of the law as disclosed by the 
 Commission's report : 
 
 1. He never paid a dollar of his own for the stock in any of 
 
 these transactions. 
 
 2. He never bought a share of Boston and Maine stock 
 
 where the New Haven did not furnish him the money. 
 
 3. He never sold a share of the Boston and Maine stock 
 
 except as the New Haven dictated. 
 
 4. All securities nominally held by the Billard Company were 
 
 kept in a subdivision of the vaults of the New Haven. 
 
 5. The Billard Company was organized by the general coun- 
 
 sel of the New Haven. 
 
 6. The Navigation Company furnished the $2,000,000 for
 
 INDUSTRIAL AUTOCRACY AND CONSUMER 225 
 
 which the Billard Company was capitalized. Billard 
 testified that he did not pay any of his own money for 
 the stock. 
 
 7. The Billard Company bought other Boston and Maine 
 
 stock in addition to the 109,948 shares. 
 
 8. There is no evidence that the Billard Company acted for 
 
 or on behalf of any interest other than the New Haven. 
 
 9. The whole capital stock of the Billard Company was used 
 
 as his own by Charles S. Mellen (President 6f the New 
 Haven) as collateral security for his own personal bor- 
 rowing of $375,000. 
 
 10. The Billard Company paid out of its treasury $375,000 
 
 to enable John L. Billard to repossess himself of the 
 $2,000,000 capital stock of that company after the same 
 had been pledged by Mr. Mellen. 
 
 11. J. L. Billard purposely burned his books and papers so 
 
 as to get them out of the way. 
 
 12. The Billard Company was used to take over some of the 
 
 questionable assets of the New Haven and assets which 
 it was desirable to conceal. 
 
 13. The minutes of the board of directors of the New Haven 
 
 show that Billard was to receive no profit out of this 
 transaction other than a reasonable compensation. 
 
 14. In two other transactions shown in this case Billard and 
 
 his company were admittedly used to accomplish New 
 Haven purposes, and in one of them, which resulted in 
 a loss, the New Haven made up the deficit to the Billard 
 Company. 
 
 All these practices and many more of record represent 
 transactions within the industrial state proper, but industrial 
 autocracy does not confine its practices to the industrial state. 
 It reaches out its malign influence and endeavors to control 
 also the educational state for its own selfish purposes. The 
 Commission's investigation disclosed " how public opinion was 
 distorted ; how officials who were needed and who could be 
 bought were bought ; how newspapers that could be subsidized 
 were subsidized ; how a college professor and publicist secretly 
 accepted money from the New Haven while masking as a repre- 
 sentative of a great American university and as the guardian of 
 the interests of the people; how agencies of information to
 
 226 THE WORKERS AT WAR 
 
 the public were prostituted wherever they could be prosti- 
 tuted in order to carry out a scheme of private transportation 
 monopoly imperial in its scope." 
 
 Among these particular incidents in " the loose, extravagant, 
 and improvident administration of the New Haven " were : 
 The unwarranted expenditure of large amounts in " educating 
 public opinion " ; the disposition, without knowledge of the 
 directors, of hundreds of thousands of dollars for influencing 
 public sentiment ; attempts to control utterances of the press 
 by subsidizing reporters; the investment of $400,000 in se- 
 curities of a New England newspaper. 
 
 Even these questionable practices are not all. Not con- 
 tent with its malpractices within the industrial state and its 
 attempts to control the educational state, the New Haven in- 
 dustrial autocracy blatantly attacked the instrumentalities of the 
 sovereign political state itself. Not only did the Commis- 
 sion's investigation into the financial workings of the man- 
 agement of the New Haven system disclose one of the most 
 glaring instances of maladministration revealed in all the his- 
 tory of American railroading but it also uncovered many in- 
 stances of violation of the laws of different States. 
 
 Briefly summarized, here are some of the Commission's in- 
 dictments of the activities of the New Haven industrial autoc- 
 racy in its efforts to dominate for its own purposes the po- 
 litical institutions of the free people of New England: 
 
 The unlawful diversion of corporate funds to political or- 
 ganizations. 
 
 Payments made for political purposes totaled a large sum. 
 For instance, in 1900, $50,000 was contributed by the New 
 Haven for campaign purposes through J. P. Morgan and Com- 
 pany. No proper and complete voucher for this payment 
 appears on the books of the New Haven Company. In 1904 
 a payment of $50,000 was made through Mr. Mellen for polit- 
 ical purposes. This was secretly done and not reported to the 
 directors or stockholders or in any manner made public. 
 
 The regular employment of political bosses in Rhode Island 
 and other States, not for the purpose of having them perform
 
 INDUSTRIAL AUTOCRACY AND CONSUMER 227 
 
 any service but to prevent them, as Mr. Mellen expressed it, 
 from " becoming active on the other side." 
 
 Payment of money and profligate issue of free passes to 
 legislators and their friends. 
 
 Extensive use of a paid lobby in matters as to which the 
 directors claim to have no information. 
 
 The scattering of retainers to attorneys of five States, who 
 rendered no itemized bills for services and who conducted no 
 litigation to which the railroad was a party. 
 
 The story of Mr. Mellen as to the distribution of $1,200,000 
 for corrupt purposes in bringing about amendments of the 
 Westchester and Port Chester franchises. 
 
 In connection with the steamship purchases by the New 
 Haven it was necessary to have piers. The record shows 
 money payments in connection with pier leases which were un- 
 mistakably improper, and these payments were covered up by 
 being charged on the books of other companies to the New 
 Haven under such headings as '* repairs on steamers." These 
 pier leases in the city of New York are controlled by public 
 officials, as the municipality owns the piers, and arrangements 
 for the leases had to be made through these officials. But be- 
 cause of the methods employed to conceal these expenditures 
 by increases of capital stock and otherwise, it has been impos- 
 sible to give any total amount of these payments. 
 
 " The New Haven management had no politics," comments 
 the Interstate Commerce Commission on the large expenses 
 incurred out of the treasury of the corporation in litigation, in 
 procuring legislation, and in the New Haven's attempts to stem 
 the tide of adverse popular opinion. " It was Democratic in 
 Democratic States and Republican in Republican States. As 
 Mr. Mellen testified, its effort was always to ' get under the best 
 umbrella/ No public-service corporation may rightfully use 
 corporate funds to promote a political cause or to support a po- 
 litical candidate or a political party. A corporation as such has 
 no political principles to maintain and no political candidates to 
 support. The revenues of a public-service corporation are for 
 the most part derived from the exercise of the right delegated 
 to it by the sovereign power to tax the public by fixed rates 
 established in accordance with law. Shippers and the traveling
 
 2-8 THE WORKERS AT WAR 
 
 public may be presumed to be divided in political opinion. 
 Corporate revenue derived by public tax from men of one 
 political conviction can not be used to support the fortunes 
 of a candidate or party of contrary political principles. Re- 
 gardless of the injustice to stockholders and travelers belonging 
 to another party which results from such use of funds, the 
 withdrawal from corporate use and the diversion to political 
 use is illegal and indefensible. 
 
 " Corporate funds may not be used for other than corporate 
 purposes. That there was, at the time of such taking and 
 diversion from corporate use, no express statute making such 
 acts criminal, in no degree justifies or renders lawful such 
 indefensible use of corporate funds. It was always dishonest. 
 The state itself may not use public funds for other than pur- 
 poses prescribed by law. No creature of the state can assert 
 power of which the state itself is devoid, to use money derived 
 from a tax on shippers and travelers to promote the interests 
 of any political party. Nor is the ' education ' of the public 
 upon economic issues any part of the province of a corporation 
 such as is here in question. Such political and ' educational ' 
 use of corporate funds is a gross injustice to the stockholders 
 and the public." 
 
 Among the characteristic features of the industrial autocracy 
 of the New Haven were " the domination of all the affairs of 
 this railroad by Mr. Morgan and Mr. Mellen and the absolute 
 subordination of other members of the board of directors to 
 the will of these two " ; " the indefensible standard of business 
 ethics and the absence of financial acumen displayed by eminent 
 financiers in directing the destinies of this railroad in its at- 
 tempt to establish a monopoly of the transportation of New 
 England " ; corporate and financial practices which on a rea- 
 sonable estimate have resulted in a loss to the New Haven of 
 between $60,000,000 and $90,000,000 ; " an unsound and mis- 
 chievous " monopoly theory to effect which the New Haven 
 attempted to circumvent governmental regulation and to extend 
 its domination beyond the limits fixed by law. " To achieve
 
 INDUSTRIAL AUTOCRACY AND CONSUMER 229 
 
 such monopoly," says the Commission, " meant the reckless 
 and scandalous expenditure of money; it meant the attempt 
 to control public opinion ; corruption of government ; the at- 
 tempt to pervert the political and economic instincts of the 
 people in insolent defiance of law. Through exposure of the 
 methods of this monopoly the invisible government which has 
 gone far in its efforts to dominate New England has been 
 made visible."
 
 INDUSTRIAL AUTOCRACY AND THE CORPORATION 
 
 PRACTICES and methods of industrial autocracy similar 
 to those described as having financially wrecked the New 
 Haven have also resulted, in their operation upon the rail- 
 roads alone since 1900, in the looting of the Boston and Maine, 
 the Chicago and Alton, the Rock Island, the St. Louis and 
 San Francisco, the Pere Marquette, the Cincinnati, Hamilton 
 and Dayton, and other corporations engaged in the production 
 of transportation services for the people. In most instances 
 these railroads had previously been highly prosperous and 
 thriving, serving efficiently rich and growing sections of the 
 country, and conservatively managed in the interest of the 
 public welfare. One of the effects of this reign of industrial 
 autocracy has been an increase in the number of and additions 
 to already existing private fortunes of " undesirable " citizens 
 and in consequence an increase in, or what might have been a 
 decrease of, the cost of producing transportation to these cor- 
 porations which prevents higher wages to the workers and 
 Tower rates to the consumers. 
 
 As has been said, the corporation is the operating instru- 
 mentality by means of which industrial autocracy attains its 
 ends. Let us admit at the very outset that the production of 
 commodities or services by the corporation has incalculable 
 social advantages. An entire volume could be written detail- 
 ing these advantages but at the present we are not concerned 
 with this aspect of the industrial state. While the welfare of 
 society demands that all these advantages be retained, it also 
 just as imperatively demands that the evils and injurious prac- 
 tices of the corporate control of wealth production and dis- 
 
 230
 
 THE CORPORATION 231 
 
 tribution be eradicated. For within and behind the corporation 
 Special Privilege, which has been driven by the people from 
 their religious, their educational, and to a large extent from 
 their political state, has taken refuge and is today entrenched 
 in the industrial state. 
 
 The corporation is a creature of the political state it is 
 brought into existence by means of a charter from the State 
 and all the powers to which it has any right are conferred upon 
 it through this exercise of the sovereignty of the people. Pow- 
 ers not specifically conferred upon it by its charter or act of 
 incorporation are reserved exclusively to all the people. If 
 its operation were confined to the exercise of its specified au- 
 thority and if the powers granted were effectively regulated 
 by the political state the workers and consumers would have no 
 cause for complaint. But the corporation has assumed rights 
 and appropriated values which it was never intended it should 
 have. The political state has been neglectful of its creature 
 in that its representatives have not properly regulated the op- 
 eration of the corporation in the interests of the people. 
 
 Now the corporation of and by itself is inoffensive; it is an 
 inanimate thing, and itself can do no harm to the people. 
 Whether it is beneficial or injurious depends upon the hands 
 which direct its operation and the use to which it is put. It 
 is like a revolver in that in the hands of a thief or thieves it 
 can be made the instrument of robbery while in the hands of 
 well intentioned men it can be made a weapon of social justice. 
 There are many corporations honestly managed and efficiently 
 conducted for the benefit of the people. There can be no 
 denying and there should be no attempt to deny this fact. At 
 the same time it is also equally true that in far too many 
 cases the corporation is in the control of men who use it simply 
 as a means of exploiting the people either through low wages 
 or high prices or both. 
 
 The corporation is the instrument for accomplishing the 
 purpose of the owners of capital. Now capital itself, like its 
 agent the corporation, is neither a saint nor a sinner ; it is not,
 
 232 THE WORKERS AT WAR 
 
 either morally or economically, a law unto itself, irrevocable, 
 and working towards an end regardless of human welfare or 
 the happiness of the individual. It is this only when the 
 owner of the particular capital wills it to be. Capital simply 
 obeys the command of its owner or of whoever may be in con- 
 trol of it for the time being. Capital of its own volition did 
 not turn itself into the manufacture of guns and other mu- 
 nitions of destruction in 1914 at the outbreak of the European 
 war; it withdrew from peace time production and pursuits 
 only at the command of those who were in control of it. It 
 was capital in the hands of the American Red Cross that per- 
 formed the healing and humane tasks on the battlefields of 
 Europe just as it was capital directed by the Imperial German 
 Army that accomplished its destructive and inhuman deviltry. 
 Scores of similar contrasts of the use and misuse of capital 
 will readily occur to the reader. 
 
 Thus the mission or purpose of capital cannot be dissociated 
 from the intent of its possessor. So when we see capital pay- 
 ing low wages and find wage earning citizens living in anti- 
 sociaj conditions of disease and poverty when we see the con- 
 sumer exploited through high prices we can be pretty sure 
 that the owner of this particular capital employing these 
 workers and enforcing these prices wills these conditions to 
 exist. It is true the owner of the particular capital may not 
 know of these conditions his capital may have been bor- 
 rowed by some one else who puts it to work in this way. But 
 this does not alter the fundamental fact, already stated, be- 
 cause for the time being the borrowed capital is temporarily 
 " owned " by the user thereof who wills the low wages and 
 the high prices. True also it is that the owner may have his 
 desire centered in those benefits which this misuse of capital 
 brings to him rather than in the effect its misuse has on the 
 wage worker and the consumer. If owners of capital were 
 more frequently identified personally in the public mind with 
 the methods and practices accompanying the use to which it 
 is sometimes put in production, they might in shame and dis-
 
 THE CORPORATION 233 
 
 grace withdraw their capital from that particular employment. 
 
 As to the character of the organization of the corporation 
 there is a woeful lack of knowledge on the part of the public. 
 Superficially, the corporation gives the impression that it is 
 democratic in its organization in that the exercise of the au- 
 thority conferred by its charter or act of incorporation is vested 
 in its stockholders. The fact is that the source of the corpora- 
 tions' authority within the limitations of its charter rights does 
 not lie with a majority of the number of its stockholders but 
 with a majority of the shares of stock which the corporation 
 issues. Let us illustrate this point in the case of the New 
 Haven. 
 
 At the time of the financial wrecking of this railroad cor- 
 poration, the Mutual Life Insurance Company of New York, 
 another corporate creature of the political state, owned 35,- 
 640 shares of the New Haven's stock. With each share rep- 
 resenting one vote, this amount of stock in the stockholders' 
 meetings represented that many votes. The American Ex- 
 press Company, still another corporation, owned 23,493 shares 
 and in consequence had that many votes. The total number of 
 stockholders in the New Haven at the time was 21,948, so 
 that either of these two corporations of and by itself 
 exercised greater voting power than all the remaining 
 stockholders combined, assuming that each of the 21,947 
 owned but a single share of stock. The New York 
 Central and Hudson River Railroad Company, another 
 and competing transportation corporation, also a creature 
 of the political state, cast 11,148 votes in the stock- 
 holders' meetings of the New Haven; Charles Pratt and Com- 
 pany was credited on the books of the New Haven with the 
 ownership of stock equal to 10,463 votes. Mr. Lewis Cass 
 Ledyard, a single individual stockholder, cast 20,542 votes ; 
 another individual stockholder, Mr. C. S. Mellen, the president 
 of the New Haven, had 8,780 votes; Mr. C. M. Pratt, 6,690 
 votes ; and Mr. J. P. Morgan, a member of the board of di- 
 rectors of the New Haven, 5,077 votes.
 
 234 THE WORKERS AT WAR 
 
 Thus the principle of voting power based upon the amount 
 of stock owned and not upon the number of stockholders gives 
 to a single corporation such as the Mutual Life Insurance 
 Company as many votes as would be cast by 35,640 separate 
 stockholders each owning one share of stock. Such had been 
 the public refutation of the New Haven management prior to 
 its wrecking that thousands of citizens of New England, de- 
 pendent widows and orphans, and savings banks, charitable 
 societies, and executors of trust funds and the like, regarding 
 its securities as a safe and conservative investment, had placed 
 their all in its securities ; and yet all combined these thousands 
 of stockholders representing millions of dollars of hard-earned 
 savings and in thousands of cases everything of money value 
 many of them had in the world, did not possess as much of a 
 say in the stockholders' meetings as did a single corporation. 
 
 The seat or source of all power possessed by the corporation 
 within the limitations of its charter rights lies then, not with 
 a majority of the number of stockholders, as is generally be- 
 lieved, but with the owner or owners of a bare majority of the 
 amount of shares of stock the corporation has issued. And 
 this majority of shares may be and frequently is possessed and 
 its powers exercised by a single corporation. 
 
 Let us carry the analysis a step further. The New Haven 
 corporation itself, through its ownership of stock of the Cen- 
 tral New England Railroad Company, cast 49,649 votes, or 
 98.7 per cent, of the total voting power, in all stockholders' 
 meetings of the Central New England ; it cast 290,600 votes, a 
 bare majority of the total number of votes but sufficient to 
 decide all questions submitted, in all stockholders' meetings of 
 the New York, Ontario and Western Railroad Company. This 
 voting power of a single corporation is greater than the com- 
 bined voting strength of the remaining 3,501 stockholders. 
 Through ownership of 90.7 per cent, of the stock of the Boston 
 Railroad Holding Company, the New Haven, although not 
 owning a single share of stock in the Boston and Maine Rail- 
 road Company, nevertheless controlled 53.6 per cent, of the
 
 THE CORPORATION 235 
 
 voting power of the stockholders of the Boston and Maine. 
 Possession of a little over one-half or a bare majority of the 
 shares usually means control of the policy of a corporation. 
 This voting power of the New Haven in the Boston and Maine 
 is greater than the combined voting strength of the remaining 
 8,104 stockholders. But this is not all. Through this indirect 
 but none the less effective control of 53.6 per cent, of the vot- 
 ing power of the Boston and Maine stockholders, the New 
 Haven, without the ownership of a single share of the stock 
 of the Maine Central Railroad Company, controlled 50.5 per 
 cent., or more than a majority, of the voting power of the 
 Maine Central stockholders. This is greater voting power in 
 the Maine Central in the hands of a single corporation, itself 
 not a stockholder, than is possessed by all the remaining 755 
 stockholders. 
 
 In brief, a single stockholder, and this, too, another corpora- 
 tion in this case the New York, New Haven and Hartford 
 Railroad Company on the basis of shares of stock exercises 
 greater voting power in the meetings of stockholders of other 
 corporations than does 99.9 per cent, of the total number of 
 their stockholders. In consequence of this situation, which 
 is nation-wide in its scope and which may be said to be a gen- 
 eral practice among corporations, the meeting of the stock- 
 holders of the corporation is today the greatest travesty on the 
 principle of representative government of which it is possible 
 to conceive. Such meetings have the form of democracy but 
 none of its substance. By means of this control of a majority 
 of the shares of stock, and through the utter indifference of 
 most stockholders to their duties, not only in their absence 
 from such meetings but also in the practice of signing away 
 their responsibilities through blank proxies, the proceedings are 
 usually " cut and dried " affairs with no adequate presentation 
 or discussion of the vital problems of the industrial state that 
 lie within the jurisdiction of this delegated form of government. 
 And these individual stockholders, as a rule, are consumers 
 whose interest in the just government of the industrial state
 
 236 THE WORKERS AT WAR 
 
 is as vital, if not more so, than that of the workers employed 
 by the corporation. 
 
 It is at the meeting of the stockholders of a corporation that 
 the board of directors is elected. This board is the government 
 of the corporation to which the stockholders delegate the pow- 
 ers they have received from the State it is the machinery 
 for the exercise of all the powers vested in the corporation. 
 The election of the board is somewhat analogous in the indus- 
 trial state to the election by the voters of the political 
 state of their government to which they delegate for a 
 stated period the exercise of the sovereignty of the political 
 state. An important difference is that the government of the 
 political state is selected on the principle of a majoirty of those 
 voting, with each having one vote equal in power to any other 
 single vote, while the board of directors of a corporation, pre- 
 sumably elected by its stockholders, is selected by the owner 
 or owners of a majority of shares of the stock of the corpora- 
 tion. As we have seen, this ownership may be by a single 
 individual or corporation ; it may be that the stock is not even 
 owned directly but is controlled by ownership of a majority of 
 the shares of an entirely different corporation. 
 
 Thus it has come about in the development of the institutions 
 of the industrial state that a single voter in the stockholders' 
 meeting exercises greater voting power than all the remaining 
 stockholders whose interests may be and not infrequently are 
 antagonistic. In testimony before the House Committee on 
 the Judiciary of the Sixty-third Congress * Mr. Samuel Unter- 
 meyer expressed the opinon that the oppression of minority 
 stockholders " is one of the greatest evils of the present-day 
 corporate management due to the toleration of the holding com- 
 pany. It is the rule rather than the exception. I might say 
 that it is almost the invariable accompaniment of the holding 
 company. The idea that one corporation should control the 
 policy and the business of another against the protest of an 
 outstanding minority is abhorrent to one's sense of justice, as 
 
 1 Hearings on Bills Relating to Trust Legislation, page 895.
 
 THE CORPORATION 237 
 
 is also the exclusion of the minority from all representa- 
 tion. . . . There is no more important subject within the do- 
 main of corporate reform, for it is a crying evil. You may 
 have bought your holdings in an independently conducted com- 
 pany and wake up some fine day to find yourself a victimized 
 minority holder, with the majority holdings in the grip of a 
 corporation with purposes quite alien to the best interests of 
 your company and with no redress. That should no longer be 
 possible." 
 
 The injurious effects to the consumer as well as to the 
 worker, which latter is beginning to demand though faintly 
 some kind of representation in industry, inevitably flowing out 
 of this autocratic organization and operation of the corporation 
 are innumerable and widespread. It is not tfie purpose here, 
 even if the limitations of space did not forbid, to enter into 
 any analysis of the many practices accompanying this control 
 of the corporation that are affecting seriously the economic 
 welfare of the people. But there is one aspect of the situation 
 that must be touched upon. 
 
 All the innumerable transactions of the industrial state in- 
 volving the production of commodities and services, such as 
 purchases, sales, leases, rentals, and so on, are covered by con- 
 tracts legally enforceable in the courts. Where these contracts 
 are between corporations their terms are determined in the 
 final analysis by the board of directors. In those numerous 
 instances where such contracts exist between corporations 
 whose boards of directors are elected and controlled by the 
 same individual or group of individuals, the effect is exactly the 
 same as it would be if the individual or group entered into a 
 contract with himself or itself. 1 The records of the looting of 
 the New Haven and other corporations abound in instances of 
 such contracts. No court of law in the land would enforce a 
 
 1 " The principal directors of the company (the Central Pacific Rail- 
 road Company) all received large salaries as compensation for their 
 various services as president, treasurer, secretary, or manager of the 
 company. It is therefore impossible to find any justification for the
 
 238 THE WORKERS AT WAR 
 
 contract an individual makes with himself, and yet in hun- 
 dreds and thousands of cases where a contract is made between 
 two or more corporations controlled by the same individual or 
 group such contracts receive the sanction of the courts. Thus 
 merely through a legal fiction a contract is enforced in which 
 an individual or group buys from or sells to himself or itself. 
 And in all these cases in the industrial state today private for- 
 tunes are being accumulated by the individuals concerned at 
 the expense of the worker in low wages and of the consumer 
 in high prices. 
 
 The records of the Interstate Commerce Commission are re- 
 plete with instances of such questionable transactions. In its 
 report of the New Haven investigation, to which references 
 have already been made, the Commission says of the lease sys- 
 tem under which the New Haven has secured control of many 
 of its three hundred and more subsidiary companies : " It 
 must also be evident that under a system of this kind unjust 
 charges may be imposed upon the public without yielding un- 
 due returns to the operating company, provided the leases are 
 upon too high a basis. It by no means follows, because the 
 Boston and Maine does not make earnings sufficient to pay its 
 fixed charges, that its rates are too low and should be advanced. 
 There is still the fundamental inquiry, Are the rentals of the 
 Boston and Maine too high? If they are, it may be necessary 
 to readjust those rentals upon some new basis in order that 
 justice may be done to all parties interested. It would be a 
 monstrous proposition that, because at some past day some 
 board of directors of the Boston and Maine had agreed to pay 
 an extravagant price for the use of the lines making up its 
 system, therefore the owners of these properties are for all 
 time entitled to obtain this undue return upon their invest- 
 ment." 
 
 transfer to themselves of the entire franchise of this company, repre- 
 sented in its stock, and of a considerable portion of its assets, obtained 
 through contracts made by their own votes." Report to the President 
 of the United States of the Pacific Railway Commission.
 
 THE CORPORATION 239 
 
 Even though it is a monstrous proposition, it is exactly what 
 is actually happening all over the country. In Philadelphia, 
 for instance, the people are suffering for the lack of adequate 
 street car facilities because the Philadelphia Rapid Transit Com- 
 pany, burdened with such leases and rentals of subsidiary com- 
 panies which exact exorbitant and extortionate returns, is un- 
 able to finance imperatively needed improvements, betterments, 
 and extensions. Private fortunes in Philadelphia, built up 
 through such contracts and by the manipulation of securities 
 between various public utility corporations, are notorious and 
 these private fortunes in large part rest today upon the ability 
 of the Philadelphia Rapid Transit Company to extort from the 
 passenger a fare high enough to meet such charges for rentals 
 to subsidiary companies of leased lines. 
 
 Thus the present-day complex, intricate, and wholly and in- 
 tentionally confusing autocratic industrial system has its ex- 
 istence based upon the legal fiction of the sanctity of contract. 
 Now no one can have greater reverence for contractual rela- 
 tions than has the writer much of the progress of that which 
 we are prone to call civilization rests on the sacredness of these 
 relations. But the sacrilegious practices of those in control of 
 our corporations with regard to these relations should receive 
 from the public neither respect nor willing obedience. There 
 should be no more sanctity in such a device or subterfuge to 
 escape the just penalty of what in many cases is actual theft 
 than there is in the enforcement of a contract made by an 
 individual with himself, for this is what has actually been done 
 when the legal fiction is stripped away.
 
 CHAPTER XXIII 
 
 THE ORGANIZATION OF THE CONSUMER 
 
 f I A HE European war has forced the American people to open 
 * their eyes to a number of manifestations of their national 
 life with regard to which for years they have simply been 
 drifting without any thoughtful consideration as to the goal 
 towards which this drifting was carrying them and their form 
 of government. Among these manifestations are the nature 
 and characteristics of the industrial organization that has 
 grown up for the production, distribution, and consumption of 
 socially produced wealth. 
 
 It is not possible here to refer even briefly to its historical de- 
 velopment. Today we find accompanying the autocratic ex- 
 ercise of economic sovereignty by a single corporation within 
 its sphere of influence in the industrial state, as already de- 
 scribed, that there has developed also a centralization or con- 
 centration of economic power through organized relations be- 
 tween groups of corporations by means of intercorporate stock 
 ownership and interlocking directorates. These systems have 
 been described fully and in detail in evidence from official 
 documents presented by the writer before wage arbitration 
 boards appointed by Presidents of the United States and in rate 
 cases before the Interstate Commerce Commission and State 
 public utilities commissions. 1 
 
 1 Exhibits Submitted Before the Board of Arbitration, Concerted 
 Wage Movement, Eastern Territory, 1913, Order of Railway Con- 
 ductors and Brotherhood of Railroad Trainmen. 
 
 Before the Interstate Commerce Commission, Investigation and 
 Suspension Docket No. 333, in the Matter of Rate Increases in Official 
 Classification Territory, known as the Five Per Cent Case, 1914. 
 
 Before the Public Utilities Commission of Ohio in the Matter of In- 
 
 240
 
 THE ORGANIZATION OF THE CONSUMER 241 
 
 The situation at the opening of the twentieth century was 
 that the American people were permitting the unregulated op- 
 eration of powerful and autocratic national trusts or corpora- 
 tions each in monopoly control of some one or several of the 
 necessities of life. Steel, copper, oil, coal, meat products, 
 sugar, tobacco, and scores of like necessities were being pro- 
 duced in mill and mine and plant by millions of workers at low 
 wages and distributed to consumers at high prices. Partly 
 to keep these wages low aliens were imported from Europe by 
 the shiploads and concentrated in the industrial centers under 
 the most deplorable living conditions ; to keep prices high com- 
 petition was ruthlessly suppressed and where necessary to the 
 purpose of the corporation recourse was had even to control of 
 the courts and Government of the people. 
 
 One of the many evil consequences of this was the springing 
 up over night like mushrooms of millionaires and even multi- 
 millionaires by the hundreds and thousands, reflecting the rapid 
 accumulation of the largest number of separate private for- 
 tunes ever produced before in any similar period of time in 
 the history of the world. These were concealed from the pub- 
 lic in greater part under the guise of the corporation. Thus 
 " legal " claim to the use and enjoyment of the wealth of the 
 country as represented in its natural resources became concen- 
 trated in the hands of a relatively insignificant number of in- 
 dividuals and families instead of this wealth being widely dif- 
 fused among all the people in fair wages to the workers and 
 
 crease of Intrastate Rates by the Hocking Valley Railway Company. 
 
 Before the Public Service Commission of Pennsylvania, Pittsburgh 
 Coal Operators' Association, Complainant, vs. Pennsylvania Railroad 
 Company, et al, 1916. 
 
 Before the Interstate Commerce Commission, I. and S. Docket No. 
 774, Bituminous Coal to Central Freight Association Territory, etc., 
 1916. 
 
 Before the Interstate Commerce Commission, No. 5725, Lake Cargo 
 Coal Rates, 1916. 
 
 See also " Intercorporate Railway Stock Ownership " and " Inter- 
 locking Directorates," published by the author.
 
 242 THE WORKERS AT WAR 
 
 fair prices to the consumers. It was a challenge to our boasted 
 democratic society and its republican institutions which the 
 Government has been unable or at least unwilling to meet. Be- 
 cause of this failure of Government the American working- 
 man has been compelled to revolt against his low wages and 
 for years has been struggling to organize himself in labor 
 unions that would be strong enough to secure to him for his 
 labor a living wage. On this issue great industrial wars or 
 strikes have been and are being waged between the union and 
 the corporation. This was the situation in the industrial state 
 at the outbreak of the European war. It is the situation today 
 only more aggravated by the experience of labor during the 
 war. 
 
 The principal object of industrial autocracy through the 
 corporation is monopoly control of wages and prices for the 
 personal profit of those who dominate by means of stock own- 
 ership these producing corporations. 1 In consequence there is 
 no provision in the present organization of the corporation for 
 representation of the vital interests of the wage worker, one 
 of the three parties to production. 
 
 No one fact stands out more conspicuously in a survey of 
 our industrial state than that the present system of autocratic 
 organization of production has alienated the friendship and 
 loyalty and self-interest of the great mass of wage earners. 
 
 1 Referring to this situation as reflected in the railway transporta- 
 tion field through intercorporate stock ownership the Interstate Com- 
 merce Commission says : " The conclusion is indisputable that rail- 
 way corporations do not purchase railway stock widely for purposes 
 of investment, but that the holdings in the stock of other railways 
 are rather for the purpose of controlling or influencing the manage- 
 ment of corporations whose operations are of real concern to the 
 holding company. ... It is difficult to discover any economic justifica- 
 tion for the existence of these holding companies and for their enor- 
 mous issues of securities. The only rational explanation, as already 
 noted, is their employment as a medium by large financial interests to 
 concentrate and perpetuate control." Special Report No. i, Inter- 
 corporate Relationships of Railways, Interstate Commerce Commis- 
 sion.
 
 THE ORGANIZATION OF THE CONSUMER 243 
 
 The mere record of strikes and lockouts supplies complete 
 proof of this assertion. 
 
 The existence of hundreds of strong and powerful national 
 and international labor unions with their millions of members 
 but emphasizes lost opportunities by our captains of industry 
 in the organization for social ends of our system of produc- 
 tion, distribution, and consumption of wealth. The economic 
 welfare of the worker engaged in production, much more so 
 than that of the employer, lies fundamentally in the direction of 
 securing the greatest possible output with the minimum ex- 
 penditure of capital and labor, and yet the employe has been 
 prevented from following this economic self-interest by the 
 short-sighted policy of the employing class in its distribution of 
 the proceeds of industry. This distribution has been arbi- 
 trarily and autocratically controlled by the employing group. 
 It has granted to the worker only that amount which would 
 barely meet his mere physical necessities for food, clothing, 
 and shelter and quite frequently not enough even for these 
 imperative needs and has retained for itself all the remain- 
 ing proceeds of production. In this policy it has completely 
 ignored the loyalty and friendship and cooperation of the 
 worker and thereby has missed the development of a veritable 
 mine of potential wealth. In place of these the employing 
 class has developed the opposition and antagonism of the wage 
 earner. The inevitable result of this policy has been the steady 
 growth in the power of the labor union. 
 
 There is no provision in the present autocratic organization 
 of the industrial state, as reflected in the corporation, for repre- 
 sentation of the vital interests of the consumer, one of the three 
 parties to production. 
 
 Is the short-sightedness of those in charge of the manage- 
 ment and direction of our capitalistic system of production to 
 cause history to repeat itself? Are the producers to lose the 
 friendship and loyalty and cooperation of the consumers as they 
 have that of the workers? 
 
 There is abundant evidence on all sides that this is the pres-
 
 244 THE WORKERS AT WAR 
 
 ent tendency. Profiteering and exploitation on the part of 
 producers, which has been a conspicuous manifestation of the 
 activities of our national life the past six years, will just as 
 certainly in course of time result in the organization of the 
 consumer to protect himself against the injustice of high prices 
 as did like economic forces compel the wage earner to organize 
 against low wages. Unfair distribution of the proceeds of 
 industry, in which all three groups in society are vitally in- 
 terested, will alienate the consumer as it did the worker. And 
 this organization of the consumer will be as much to the ulti- 
 mate disadvantage of the producer, if not more so, than is the 
 present organization of the worker. Our recent war expe- 
 rience with profiteers shows quite clearly how easy it is to 
 cause the springing up of housewives' organizations and the 
 like in opposition to high prices. The producers' best friend is 
 the consumer only it is to be feared the average producer of 
 today does not realize this fact. 
 
 It is the consuming class which in the final analysis supplies 
 the capital for every business, meets the cost of fixed charges, 
 furnishes the current assets, and balances the pay-roll. In 
 one aspect of the case the employer is merely the employe of 
 the consumer an agent, self appointed it is true, for sup- 
 plying the consumer with needed commodities and services. 
 It is commonly believed that wages and like expenses of pro- 
 duction are paid by and out of capital supplied by the employer 
 but if the facts are analyzed closely enough it will be found 
 that in the final analysis wages are paid by the consumer out of 
 his contribution to production through prices, except at the 
 initial establishing of the industry, and even in this case, if 
 the means of production prove successful, these wages have 
 merely been advanced by the employer while their cost is ul- 
 timately met by the consumer. It can thus be seen how im- 
 portant to the successful conduct of industry is the friendship 
 of the consumer. Its cultivation and retention should be a 
 matter of concern to the manager of industry. If the con- 
 sumer goes on strike if he refuses to purchase a particular
 
 THE ORGANIZATION OF THE CONSUMER 245 
 
 commodity if he exercises his individual or collective power 
 of the boycott if he transfers his demand to a substitute ar- 
 ticle if he in brief organizes his potential power to redress 
 the injustice of high prices, the producer will very soon be 
 confronted by the necessity of closing down his plant or fac- 
 tory just as effectively as is often the case in a successful strike 
 by the workers. 
 
 Our present system of corporate organization of production, 
 involving among other practices the issuance of a tremendous 
 amount of fictitious " investment " securities in the process of 
 capitalizing social values for personal or class profit, is of 
 even greater concern to the welfare of the consumer than it 
 has been indicated to be to that of the wage earner. The con- 
 dition of the " property investment " and " capital obliga- 
 tions " accounts of the railroads previously referred to is 
 taken merely as one of a score or more illustrations of prac- 
 tices that are socially injurious as well as unjust. In the pres- 
 ent dangerous situation as regards our railroads we see some 
 of these injurious results of widespread corporation practices. 
 Because of these the investing public has lost all confidence in 
 the railroads and it is extremely difficult for these transporta- 
 tion corporations to secure from investors the capital of which 
 they are in need. 
 
 For years there had been a din and clamor in certain influ- 
 ential sections of the public for a so-called valuation of our 
 railroads. Congress finally gave the Interstate Commerce 
 Commission authority to proceed with this valuation. One of 
 the instructions to the Commission in ascertaining this value 
 was to report the original investment. The Commission's ex- 
 perts claim this to be an impossibility and the railway corpora- 
 tions themselves assert'that they do not possess the facts. The 
 issuance of securities representing alleged values has had no 
 relation whatever to the amount actually invested in the prop- 
 erties plus services and labor performed and in consequence 
 not millions but billions of paper value have been created upon 
 which the holders wherever possible force a return in dividends
 
 246 THE WORKERS AT WAR 
 
 or interest. Such return can only be secured by means of 
 high prices to the consumer. The so-called investment market 
 has literally been flooded with securities by railroad and in- 
 dustrial corporations which today stand as " legal " claims not 
 only upon the earnings of these properties but also upon the 
 properties themselves. Many of these securities are in reality 
 piratical demands or tributes which are exacted every six 
 months and which extort from the consumer a price over and 
 above that necessary to meet the legitimate cost of production. 
 This paper capitalization of values that do not exist and of 
 social values which properly belong to the public is an unjust 
 economic burden upon the consumer. In large part because 
 of it a fair price is an impossibility and an excessive return to 
 alleged investment is the product. 
 
 The effects of such practices are in the nature of a blanket 
 mortgage on the annual increase in the nation's production of 
 wealth, interest on which is the payment of an unjust claim. 
 This increase should in justice be partly distributed among all 
 the people in lower prices and higher wages but instead of 
 this process it is being taken from them by the " legalization " 
 of fictitious claims to capital investment. Much of it has been 
 taken in the past through low wages to the workers. But the 
 forces let loose by the European war have released this Titan 
 from his bonds and he has risen to full stature to demand his 
 just share in wealth production. And he demands it with 
 greater assurance than in the past that he will receive his 
 share. He is very likely not only to maintain but also to ad- 
 vance this claim successfully, which means that the burden of 
 a continuance of corporation practices and methods of produc- 
 tion will be shifted to the shoulders, or rather to the pocket- 
 books, of the consumer through high prices. The anthracite 
 industry of Pennsylvania offers convincing proof of such a 
 probability. The consumer, being at present unorganized, will 
 at first be unable to resist and will be subjected to a period of 
 high prices until these exactions become so burdensome as to 
 force him also into organization for self protection. Only
 
 THE ORGANIZATION OF THE CONSUMER 247 
 
 when the worker and the consumer are sufficiently organized, 
 either separately or in combination, and cooperate to resist the 
 unjust claims of organized capital will our democratic society 
 reach that point where justice will be determined as between 
 the " rights " of the capitalist, the worker, and the consumer. 
 
 The grim truth of the whole matter at present is that our 
 corporate instrumentalities of production are not organized on 
 a basis that will permit the determination of what is a fair 
 return to capital, a fair wage to labor, and a fair price to the 
 consumer. The basis upon which they are organized is more 
 frequently a high return to the capital invested, and in many 
 cases where there has been no investment of capital, a low 
 wage, and a high price. 
 
 The organization of the consumer as an economic group to 
 define and insist upon his rights is the next necessary step 
 before there can be socialization of industrial production for 
 the common welfare. This is preeminently the problem for 
 this generation to work out, as the problem of the last gen- 
 eration was the organization of the worker. He who claims 
 to be able to supply the answer as to how this is to be done is 
 too much of a braggart to be trusted. The forcible taking 
 over by the government of the industries to which are at- 
 tached a public interest and their " nationalization " or " so- 
 cialization " so as to wipe out these false values and 
 in so doing restore to the people social values that 
 have been appropriated, thus preventing the continuance of 
 extortionate tributes from the great mass of consumers in 
 high prices, is a policy that is being insisted upon by some. 
 It is based upon the final and ultimate right of revolution 
 against injustice which is inherent in every society and the de- 
 nial of which would deprive the social organism of its last 
 weapon or instrument of regeneration. But revolution is the 
 means only after all others have failed and we should first 
 turn to the application of our best thought and patriotism to the 
 working out of a plan for a peaceable solution. 
 
 Any such plan must take into consideration the fact that the
 
 248 THE WORKERS AT WAR 
 
 determination of the return to the owner of capital or to the 
 possessor of labor cannot be left to each of these two interested 
 classes or groups. If it is, then one or both remaining classes 
 will be disadvantageously affected. If the capitalist alone de- 
 termines the return on his money or investment he is likely to 
 make it too high ; i f the worker alone determines the wage rate 
 he is to receive it also will likely be too high. Nor can the de- 
 termination be left solely to the consumer. If the latter alone 
 determines the price of the commodity or service this is likely 
 to be too low to permit of a fair wage and a fair return to 
 capital. Neither can the determination of what is a fair re- 
 turn to capital, a fair wage, or a fair price be left to any two 
 of the three parties interested in production because of the 
 danger of a possible combination of class self-interest. Such 
 determination can be arrived at only through the participation 
 of all three parties in interest. 
 
 The capitalist-producer is strongly organized in virtually 
 every industry and in associations of industries for the pro- 
 tection of his economic interest in profits ; the worker-producer 
 is likewise organized in powerful local unions and national 
 federations for the safeguarding of his economic interest in 
 wages. There are not wanting instances where these two 
 economic groups have even formed combinations for mutual 
 exploitation of the interest of the consumer. With the con- 
 sumer unorganized for, the protection of his economic interest 
 in prices, he is relatively weak and defenceless. In conse- 
 quence, upon him today rests nearly all the cost-burden of 
 production and distribution, and it is because of this that he 
 suffers from under-consumption of the wealth that our indus- 
 trial system produces. 
 
 Up to the present time the consumer has depended and to- 
 day is dependent almost entirely upon the Government to pro- 
 tect him from the social and individual evils of high prices. 
 He has allowed himself to be regarded as the public. That 
 protection the consumer has not secured. That this is true is 
 reflected in the failure of the efforts of the Wilson Adminis-
 
 THE ORGANIZATION OF THE CONSUMER 249 
 
 tration through the Department of Justice to effect in the 
 slightest degree a reduction in the high cost of living. It is 
 reflected in the inactivity of Congress. It is also shown in the 
 results of the recent bituminous coal miners' strike by which 
 the increase of 27 per cent, in wages granted by the 
 Government commission was taken advantage of by the 
 organized coal operators to increase the price of coal to the 
 consumer even beyond the amount necessary to meet the in- 
 crease in wages, assuming that this should be borne by the 
 consumer and not out of the excessive profits of the coal op- 
 erator. It is conclusively demonstrated in the exorbitant earn- 
 ings of virtually all corporations dealing in the necessaries ( of 
 life as disclosed in Senate Document Number 259, which latter 
 is a report by the Secretary of the United States Treasury on 
 profiteering during the war as shown in the payment of in- 
 come and excess profit taxes. 
 
 That something is amiss with the working out of the prin- 
 ciples of democracy in the United States is indicated so clearly 
 in the daily events of the industrial life of America that even 
 he who runs may read their significance. In the train of the 
 ever-widening circles of increasing prices have followed tend- 
 encies which have in them possible developments of far-reach- 
 ing consequences to the American people. One of these should 
 be the organization of the consumer to protect effectively his 
 economic interests in the production, distribution, and con- 
 sumption of wealth. 
 
 One of the functions of the organization of the consumer 
 is to join hands with the organized wage worker and together 
 demand and enforce the return to the people of the benefits 
 of social values to which industrial autocracy lays unjust claim 
 and of which it is in possession. The instrumentality by 
 means of which these values were appropriated and their 
 benefits are retained by autocracy is the corporation. Like 
 the land " squatter," industrial autocracy has for so long a 
 time been in possession and enjoyment of the returns on these 
 social values that its adherents and beneficiaries now insist
 
 250 THE WORKERS AT WAR 
 
 vehemently upon their " legal " ownership. And in all too many 
 cases they have actually succeeded in " legalizing " their squat- 
 ter possession of these social values by issuing securities 
 against them upon which the worker and the consumer are 
 required to pay semi-annual and annual tribute in the form of 
 interest on bonds and dividends on stocks. The interests of 
 the wage worker and of the consumer not having been given 
 consideration at the time of the appropriation of these values, 
 industrial autocracy simply continues in possession and ex- 
 ploits both groups for the benefit solely of its own members. 
 These and other values can be restored to the people by in- 
 sistence upon the democratization of the corporation with the 
 object of securing a fair profit, a fair wage, and a fair price 
 in industry. This is industrial justice, which is the aim of 
 industrial democracy, and to secure it an American Federation 
 of Consumers is most essential. 
 
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